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Item 9A. Controls and Procedures

2025-06-02 compared with 2024-04-11 · 3245 added, 3245 removed, 755 unchanged (90% of the section changed)

This section is long enough that the comparison stopped early. What follows is partial, and the remainder is not necessarily unchanged.

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Evaluation of Disclosure Controls and Procedures

The Sarbanes-Oxley Act requires,

among other things, that we maintain effective disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) that are

designed to ensure that information required to be disclosed by us in reports we file or submit under the Securities Exchange Act of 1934,

as amended, is recorded, processed, summarized and reported within the appropriate time periods, and that such information is accumulated

and communicated to the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely discussions regarding required

Our management, with the participation of our Chief Executive Officer and Chief

Financial Officer has evaluated the effectiveness of our disclosure controls and procedures.

Management recognizes that any controls and

procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management

necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.

Based on that evaluation,

our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were

not effective as of December 31, 2023, as a result of the material weaknesses described below.

The Sarbanes-Oxley Act requires, among other things,

that we maintain effective disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) that are designed to ensure

that information required to be disclosed by us in reports we file or submit under the Securities Exchange Act of 1934, as amended, is

recorded, processed, summarized and reported within the appropriate time periods, and that such information is accumulated and communicated

to the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely discussions regarding required disclosure.

Our management, with the participation of our Chief Executive Officer and Chief Financial

Officer has evaluated the effectiveness of our disclosure controls and procedures.

Management recognizes that any controls and procedures,

no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily

applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.

Based on that evaluation, our Chief

Executive Officer and Chief Financial Officer has concluded that the Company’s disclosure controls and procedures were not effective

as of December 31, 2024, as a result of the material weaknesses described below.

Management’s Annual Report on Internal

Control Over Financial Reporting

Our management is responsible

for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act).

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2023.

In making this assessment,

our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”)

in Internal Control-Integrated Framework (2013 framework).

Based on our assessment under

the framework in Internal Control-Integrated Framework (2013 framework), our management concluded that our internal control over financial

reporting was not effective as of December 31, 2023, due to the existence of the material weaknesses described below.

A material weakness in internal

control is a deficiency in internal control, or combination of control deficiencies, that adversely affects the Company’s ability

to initiate, authorize, record, process, or report external financial data reliably in accordance with GAAP such that there is more than

a remote likelihood that a material misstatement of the Company’s annual or interim financial statements will not be prevented or

Our management is responsible for establishing

and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act).

Our management

assessed the effectiveness of our internal control over financial reporting as of December 31, 2024.

In making this assessment, our management

used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated

Framework (2013 framework).

Based on our assessment under the framework in

Internal Control-Integrated Framework (2013 framework), our management concluded that our internal control over financial reporting was

not effective as of December 31, 2024, due to the existence of the material weaknesses described below.

A material weakness in internal control is a deficiency

in internal control, or combination of control deficiencies, that adversely affects the Company’s ability to initiate, authorize,

record, process, or report external financial data reliably in accordance with GAAP such that there is more than a remote likelihood that

a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected.

This Annual Report on Form 10-K does not include

an attestation report of our registered public accounting firm regarding internal control over financial reporting.

Our auditors will

not be required to formally opine on the effectiveness of our internal control over financial reporting pursuant to Section 404 until

we are no longer an “emerging growth company” as defined in the JOBS Act.

Material Weaknesses

in Internal Control Over Financial Reporting

In September 2023,

after a review completed by the Audit Committee, it was determined that our former CEO and an accounting employee charged certain personal

expenses on their corporate credit cards that were not recorded as related party receivables.

The aggregate amount of such unauthorized

charges ranged from approximately (i) $257,000 to $405,000 for all of 2022, (ii) $86,000 to $122,000 for the quarter ended March 31, 2023,

and (iii) $79,000 to $150,000 for the quarter ended June 30, 2023.

These unauthorized charges, in addition to personal charges that were

identified as such in previous reporting periods, may have constituted personal loans that are not permissible under Section 402 of the

Sarbanes-Oxley Act of 2002.

The accounting employee was also the CEO’s assistant and had roles in the Company’s system of

internal control over financial reporting, including controls relating to the Company’s corporate credit cards.

We determined that

this credit card misuse arose from the following control deficiencies, which we have determined to be material weaknesses as of December

● We did not maintain an effective

control environment as there was an inadequate segregation of duties with respect to certain cash disbursements.

The processing and the

approval for payment of credit card transactions and certain bank wires were being handled by the CEO and an accounting employee, and

the accounting employee was responsible for the reconciliation of credit card statements and bank statements.

This allowed these individuals

to submit unauthorized payments to unauthorized third parties.

do not have an effective risk assessment process and effective monitoring of compliance with established accounting policies and procedures,

and do not demonstrate a sufficient level of precision in the application of our controls.

● Our controls over the approval

and reporting of expenses paid with the Company’s credit cards and certain bank wires were not designed and maintained to achieve

the Company’s objectives.

have insufficient accounting resources to maintain adequate segregation of duties, maintain adequate controls over the approval and posting

of journal entries, and to provide optimal levels of oversight in order to process financial information in a timely manner, analyze

and account for complex, non-routine transactions, and prepare financial statements.

● We do not yet have adequate

internal controls in place for the timely identification, approval or reporting of related party transactions.

The Company did not design, implement and maintain

effective controls to ensure information technology (“IT”) policies and procedures set the tone at the top, to mitigate the

risks to the achievement of IT objectives and ITGCs in the change management, logical security and computer operations domains.

We have identified the

following internal control deficiencies, which we believe to be material weaknesses as of December 31, 2024:

We did not maintain an effective control environment as there was an inadequate segregation of duties with respect to certain cash disbursements.

We do not have an effective risk assessment process and effective monitoring of compliance with established accounting policies and procedures, and do not demonstrate a sufficient level of precision in the application of our controls.

Our controls over the approval and reporting of expense payments were not designed and maintained to achieve the Company’s objectives.

We do not yet have adequate internal controls in place for the timely identification, approval or reporting of related party transactions.”

We have insufficient accounting resources to maintain adequate segregation of duties, maintain adequate controls over the approval and posting of journal entries, and to provide optimal levels of oversight in order to process financial information in a timely manner, analyze and account for complex, non-routine transactions, and prepare financial statements.

The Company did not design, implement and

maintain effective controls to ensure information technology (“IT”) policies and procedures set the tone at the top, to mitigate

the risks to the achievement of IT objectives and ITGCs in the change management, logical security and computer operations domains.

Specifically,

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IT control environment vulnerable to breaches and social engineering persuasion.

Individually, these deficiencies were evaluated as

representing a more than remote likelihood that a misstatement that is more than inconsequential, but, less than material, could occur.

However, each of these deficiencies affects the same set of accounts.

Taken together, these deficiencies represent a more than remote

likelihood that a material misstatement could occur and not be prevented or detected.

Therefore, in combination and on the aggregate,

these deficiencies represent a material weakness.

The above material weaknesses

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Remediation of Material Weaknesses

We are committed to maintaining

a strong internal control environment and implementing measures designed to help ensure that the material weaknesses are remediated as

soon as possible.

We believe we have made progress towards remediation and continue to implement our remediation plan for the material

weaknesses, which includes steps to increase dedicated qualified personnel including financial consultants, improve reporting processes,

and design and implement new controls.

Further, following the credit card misuse discussed above, management has designed and begun to

implement the following remediation plan:

● Terminated the accounting employee

involved in the misuse and reassigned such employee’s roles and responsibilities regarding impacted control activities.

● Implemented a travel, entertainment,

and gift policy, which our Board approved on August 31, 2023.

● Implement a formal information

security policy.

● Review and update, as necessary,

the design and operation of our process level and transaction level controls for cash disbursements, credit card transactions, and journal

Implement enhanced approval policies.

As of the date of this

Annual Report on Form 10-K, management is re-assessing the design of controls and modifying processes designed to improve our internal

control over financial reporting and remediate the control deficiencies that led to the material weaknesses, including but not limited

to (a) improving consistency in change management supported by standard operating procedures to govern the authorization, testing and

approval of changes to information technology systems supporting all of the Company’s internal control processes, (b) enhancing

design and implementation of our control environment, including the expansion of formal accounting and IT policies and procedures and

financial reporting controls, (c) continuing to identify and design and implement effective review and approval controls, and (d) implementing

appropriate timely review and oversight responsibilities within the accounting and financial reporting functions and ensuring appropriate

segregation of duties.

We will consider the

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on the Effectiveness of Internal Control Processes

Our management, including

our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls or our internal control over financial

reporting will prevent all errors and all fraud.

A control system, no matter how well designed and operated, can provide only reasonable,

not absolute, assurance that the objectives of the control system are met.

Because of the inherent limitations in all control systems,

no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a

simple error or mistake.

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more

people or by management override of the controls.

The design of any system of controls is also based in part upon certain assumptions

about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under

all potential future conditions;

over time, controls may become inadequate because of changes in conditions, or the degree of compliance

with policies or procedures may deteriorate.

Because of the inherent limitations in a cost-effective control system, misstatements due

to error or fraud may occur and not be detected.

Management’s Report on Internal Control over Financial Reporting

This Annual Report on Form

10-K does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting.

Our auditors will not be required to formally opine on the effectiveness of our internal control over financial reporting pursuant to

Section 404 until we are no longer an “emerging growth company” as defined in the JOBS Act.

Our Interim Chief Executive

Officer and Interim Chief Financial Officer does not expect that our disclosure controls or our internal control over financial reporting

will prevent all errors and all fraud.

A control system, no matter how well designed and operated, can provide only reasonable, not absolute,

assurance that the objectives of the control system are met.

Because of the inherent limitations in all control systems, no evaluation

of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

These inherent

limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by

management override of the controls.

The design of any system of controls is also based in part upon certain assumptions about the likelihood

of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future

over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures

may deteriorate.

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur

and not be detected.

Changes in Internal Control over Financial

During the year ended December

31, 2023, the Company implemented enhanced approval controls over cash disbursements and journal entries.

There were no other changes

in our internal control over financial reporting during the year ended December 31, 2023, that have materially affected, or is reasonably

likely to materially affect, our internal control over financial reporting.

During the year ended December 31, 2024, there

were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange

Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Other Information.

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Directors and Executive Officers

The following table provides information regarding

our executive officers and directors as of April 5, 2024:

The following table provides information regarding our executive officers

and directors as of May 30, 2025:

Executive Officers and Directors

Ralph Schiess

Interim Chief Executive Officer and Chief Science Officer

Chief Financial Officer

Christian Brühlmann

Chief Strategy Officer

Karina Fedasz

Interim Chief Executive Officer, Interim Chief Financial Officer

Non-Employee Directors

James Sapirstein

Lead Independent Director

Andrew Oakley

Non-Executive Chairman

Timothy Ramdeen

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Executive Officers and Directors

Ralph Schiess

Schiess co-founded Proteomedix

in March 2010 and served as its Chief Executive Officer from its inception until December 2019.

Schiess then served as Proteomedix’s

Chief Scientific Officer from January 2020 to May 2023.

Schiess returned to his role as Chief Executive Officer of Proteomedix in

June 2023 and upon consummation of the Share Exchange between the Company and Proteomedix became the Chief Science Officer of the Company.

Schiess was appointed Interim Chief Executive Officer of the Company by the Board of Directors on January 12, 2024.

Harmon has more than 40

years of experience in financial positions with life sciences companies and various other industries.

Harmon has served in a variety

of roles, including chief financial officer, controller, chief executive officer, and audit committee chairman.

He has been an independent

consultant since 2008 through his business, Lakeport Business Services, Inc., and served in the outsourced CFO capacity for multiple publicly

traded companies.

During this time, Mr.

Harmon was CFO of Marizyme Inc.

from 2020 to 2021, CFO of bioAffinity Technologies Inc.

a director of Dale Biotech LLC since 2017, and a director of Patriax Industries since 2023.

He has extensive experience with fundraising,

public offerings, mergers and acquisitions, and turnarounds.

Earlier in his career, he was a member of a team that, at the invitation

of the Environmental Programmé, presented a green building product to delegates at the United Nations.

He earned a Bachelor of

Science degree in accounting from Missouri State University.

Christian Brühlmann

Brühlmann has been

Chief Strategy Officer since December 2023.

He was Chief Business Officer and co-founder of Proteomedix, which was acquired by the Company

in December 2023.

Brühlmann co-founded Proteomedix and served as its Chief Financial and Operations Officer from March 2010 until

November 2018.

Beginning in December 2018, Mr.

Brühlmann served as Proteomedix’s Chief Business Officer.

gained 20 years of experience in public and private companies in the life sciences, information and communications and financial industries.

Being responsible for product management, business development, operations and finance, he was instrumental in Proteomedix’s development

from inception to the market introduction of Proclarix.

Previously, he worked for Swisscom, Switzerland’s telecom market leader

in several strategic and leadership roles in the area of digitalization.

Brühlmann received his Bachelor and Master’s in Business

Administration from University of Zurich, Switzerland and completed executive professional trainings at the Babson College, USA and at

the University of St.

Gallen, Switzerland.

Karina Fedasz

Fedasz has helped companies raise capital,

model and forecast business, manage cash flow and conduct mergers and acquisitions.

She is a dynamic, data-driven executive with a bold,

high-growth mindset.

From January 2023 to June 2024, Ms.

Fedasz worked with various clients, including a not-for-profit and an early-stage

artificial intelligence and data-driven health and wellness tracker.

From February 2022 to December 2022, Ms.

Fedasz served as Head of

Business Development for Evofem Biosciences, a Nasdaq-listed public biotech company developing innovative products for women's health.

From August 2019 to October 2021, Ms.

Fedasz served in various positions of increasing responsibility, including Chief Financial Officer,

at IDW Media Holdings, a micro-cap media company, where she managed the company's initial public offering.

From April 2018 to August 2019,

Fedasz served as Chief Financial Officer of MOCEAN, an integrated agency for entertainment, gaming, and brands.

Fedasz's breadth

of experience has seen her lead teams in media, technology, services, manufacturing, and education, and she has worked with companies

whose clients and customers include Fortune 500 companies such as Netflix, Disney, Amazon, Apple, Activision, and EA.

Fedasz received

an MBA with an emphasis in finance from Columbia Business School and a BA from University California at Los Angeles (UCLA).

an inactive CPA in the state of California.

Non-Executive Directors

Sapirstein , one of our directors since February 2022 and our Lead Independent Director since October 2023, has over 35 years of experience leading, founding, growing, and selling

healthcare companies, specifically in the pharmaceutical space.

Sapirstein is currently the President, CEO and Chairman of First

Wave BioPharma, Inc.

FWBI), where he has been since October 2019.

His career began in sales at Eli Lilly, eventually rising

to Director of International Marketing at Bristol Myers Squibb from July 1996 to June 2000, and later led the launch of Viread

(tenofovir) at Gilead Sciences, Inc.

GILD), where he served as Global Marketing Lead from June 2020 to June 2002.

November 2006 to January 2011, he served as founding CEO of Tobira Therapeutics (Nasdaq:

TBRA), then a private company, and later

acquired by Allergan (NYSE:

Since then, he has served as CEO of Alliqua Biomedical (Nasdaq:

ALQA) from September 2012 to

February 2014 and CEO of Contravir Pharmaceuticals (Nasdaq:

CTRV) from March 2014 to October 2018.

He has been part of almost two

dozen drug product launches and specifically either led or has been a key member of several HIV product launches into different new

classes of therapeutics at the time.

Additionally, Mr.

Sapirstein has held board positions on ZyVersa Therapeutics, Inc.

ZVSA) since January 2023 and Enochian Biosciences (Nasdaq:

ENOB) since April 2018.

He previously served as a director of Marizyme,

(OTCMKTS:MRZM) (Executive Chairman) from December 2018 to June 2021, Leading Biosciences from 2016 to 2021, BioNJ, an

association of biopharma industries in New Jersey, from February 2017 to February 2019, RespireRX (OTCBB:RSPI) from April 2014 to

January 2020, NanoViricides Inc.

NNVC) from November 2018 to January 2020, and BWAC from December 2020 until its business

combination with Clarus in September 2021.

He is also a Board Director for BIO, the leading Biopharma Industries Organization

promoting public policy and networking in the healthcare space, where he sits on both the Health Section and Emerging Companies

Section Governing Boards.

Sapirstein received a B.S.

in Pharmacy from Rutgers University and his MBA from Fairleigh Dickinson

He is well qualified to serve on our Board due to his extensive network from decades in the healthcare industry.

Sapirstein brings to our Board a significant depth of experience in the pharmaceutical and biotechnology industries that will be

invaluable to the Company as we continue to develop biotechnology assets.

Simon Tarsh , one of

our directors since August 2022, has more than 40 years of financial experience, working in both the UK and the U.S.

He has recently retired

from Deloitte Consulting LLP, where he was a Senior Managing Director in the Finance and Enterprise Performance Practice, where he had

served global clients since 2007.

He led a growing global practice focused around Operational Transformation, including supporting Carve

Out transactions, joint ventures and hybrid structures, both in the US and in international locations, such as India, China, Eastern Europe

and Latin America.

He supported high growth companies with their finance operations as they globalized, and was able to advise them on

their expansion, while balancing growth with appropriate controls.

Andrew Oakley , our Non-Executive Chairman

since February 2025, is an experienced pharmaceutical and biotech industry professional.

Previously, he held CFO positions at listed pharmaceutical

companies Autolus Therapeutics plc (NASDAQ:

AUTL) from 2018 to 2022 and Sosei Group (TSE:4565) from 2017 to 2018, as well as Vectura Group

VEC) and Actelion Ltd, where he led the finance function for over a decade.

Additionally, he is a board member at a number of

privately held Biotech companies.

Oakley holds a Bachelor of Economics Degree from Macquarie University and an MBA from London Business

School and has been a Member of the Australian Institute of Chartered Accountants since 1987.

Simon Tarsh , one of our directors since

August 2022, has more than 40 years of financial experience, working in both the UK and the U.S.

He has recently retired from Deloitte

Consulting LLP, where he was a Senior Managing Director in Finance and Enterprise Performance Practice, where he had served global clients

He led a growing global practice focused around Operational Transformation, including supporting Carve Out transactions, joint

ventures and hybrid structures, both in the US and in international locations, such as India, China, Eastern Europe and Latin America.

He supported high growth companies with their finance operations as they globalized, and was able to advise them on their expansion, while

balancing growth with appropriate controls.

Prior to moving to the United States in 2007, Mr.

Tarsh’s consulting

career began with PA Consulting Group, London in 1988, where he was elected as a Partner in 1997, and he built ISG’s business process

outsourcing advisory practice in Europe between 2001 and 2006.

Tarsh’s early career was in finance, working with Marathon Oil

and Dow Chemical, and during this period, he qualified as a Chartered Accountant.

Tarsh received a Bachelor of Science undergraduate

degree in Business and Administration from the University of Salford, Manchester, UK in 1981, and an MBA from City University Business

School, London, UK in 1988.

Tarsh’s consulting career began with

PA Consulting Group, London in 1988, where he was elected as a Partner in 1997, and he built ISG’s business process outsourcing

advisory practice in Europe between 2001 and 2006.

Tarsh’s early career was in finance, working with Marathon Oil and Dow Chemical,

and during this period, he qualified as a Chartered Accountant.

Tarsh received a Bachelor of Science undergraduate degree in Business

and Administration from the University of Salford, Manchester, UK in 1981, and an MBA from City University Business School, London, UK

He is a Fellow of the Chartered Institute of Management Accountants (1984), which is considered as a CPA equivalent.

Tarsh’s deep financial experience at Deloitte Consulting LLP for fifteen years offers valuable insights to our Board, particularly

given the enhanced accounting rules and regulations affecting public companies.

Timothy Ramdeen , one

of our directors since January 2023, has nearly a decade of experience in private equity and hedge fund investing, capital markets, and

company formation.

Since June 2022, Mr.

Ramdeen has been founder and managing partner of Dharma Capital Advisors, an investment and advisory

firm focused on early-stage private and public companies.

deep financial experience at Deloitte Consulting LLP for fifteen years offers valuable insights to our Board, particularly given the enhanced

accounting rules and regulations affecting public companies.

Timothy Ramdeen , one of our directors since

January 2023, has nearly a decade of experience in private equity and hedge fund investing, capital markets, and company formation.

June 2022, Mr.

Ramdeen has been founder and managing partner of Dharma Capital Advisors, an investment and advisory firm focused on early-stage

private and public companies.

From March 2021 to March 2022, Mr.

Ramdeen was co-founder, chief investment

officer, and portfolio manager at Sixth Borough Capital Management, a multi-stage, event-driven hedge fund focused on both private and

public equities.

Ramdeen was co-founder, chief investment officer, and portfolio manager

at Sixth Borough Capital Management, a multi-stage, event-driven hedge fund focused on both private and public equities.

Since 2022, Mr.

Ramdeen has been the co-founder of Amplexd Therapeutics, which is a women’s health/biotechnology

company focused on providing low-cost, effective, safe and accessible treatments for early cervical and HPV-related cancers worldwide.

Ramdeen also serves as a corporate advisor/board member to multiple early-stage companies and investment funds.

Ramdeen has been the co-founder of Amplexd Therapeutics, which is a women’s health/biotechnology company focused on providing low-cost,

effective, safe and accessible treatments for early cervical and HPV-related cancers worldwide.

Ramdeen also serves as a corporate

advisor/board member to multiple early-stage companies and investment funds.

Previously, Mr.

was the fifth hire at Altium Capital Management (“Altium”), a healthcare-focused investment firm, where from July 2019 to

March 2021 he served as the sole investment analyst on the private capital markets/special situations desk (privately-negotiated financings,

direct investments, event-driven long/short, and private to public investments in micro and small-cap companies).

During his tenure at

Ramdeen was instrumental in co-creating the firm’s SPAC and reverse merger investment efforts and establishing extensive

relationships with sell-side constituents, buy-side counterparts, and hundreds of private and publicly traded companies across biotechnology,

therapeutics, healthcare services, medical devices and medtech.

Ramdeen was the fifth hire at Altium Capital

Management (“Altium”), a healthcare-focused investment firm, where from July 2019 to March 2021 he served as the sole investment

analyst on the private capital markets/special situations desk (privately-negotiated financings, direct investments, event-driven long/short,

and private to public investments in micro and small-cap companies).

During his tenure at Altium, Mr.

Ramdeen was instrumental in co-creating

the firm’s SPAC and reverse merger investment efforts and establishing extensive relationships with sell-side constituents, buy-side

counterparts, and hundreds of private and publicly traded companies across biotechnology, therapeutics, healthcare services, medical devices

From 2017 to 2018, Mr.

Ramdeen worked for Brio Capital Management, an

event-driven hedge fund focused on small and micro cap equities.

Ramdeen worked for Brio Capital Management, an event-driven hedge fund focused on small and micro

cap equities.

Ramdeen received his B.S.

in Biology from Temple University, where

he conducted scientific research across neurology, oncology, and developmental biology.

in Biology from Temple University, where he conducted scientific research across neurology,

oncology, and developmental biology.

In addition, Mr.

Ramdeen earned his MBA in Finance

from NYU Stern School of Business.

Ramdeen brings to our Board extensive experience in capital advisement and company development,

specifically within the life science industry and for publicly traded companies.

Thomas Meier , one

of our directors since February 1, 2024, has close to 25 years’ experience as a life-science and biotech entrepreneur, executive

manager, and board member.

Ramdeen earned his MBA in Finance from NYU Stern School of Business.

brings to our Board extensive experience in capital advisement and company development, specifically within the life science industry

and for publicly traded companies.

Thomas Meier , one of our directors since

February 1, 2024, has close to 25 years’ experience as a life-science and biotech entrepreneur, executive manager, and board member.

Since June 2022, Dr.

Meier has served as Chairman of, and member of the Audit and Compensation Committees of,

Santhera Pharmaceuticals Holding AG (SIX:

SANN), a publicly listed Swiss specialty pharmaceutical company focused on the development and

commercialization of innovative medicines for rare neuromuscular and pulmonary diseases.

Meier has served on the board of Santhera

since 2017 and stepped down as the company’s CEO in November 2019 after having served 15 years as executive manager, the last 8

years as CEO.

Meier became managing partner of Viopas Venture Consulting GmbH, a Swiss consultancy and advisory firm for

the healthcare industry.

Since 2020, Dr.

Meier has served as a board member of Novaremed AG, a privately held Swiss company developing

innovative treatment options for the management of chronic pain and alternatives to opioids.

Meier has served on Novaremed’s

Audit Committee since October 2021 and became Executive Chairman of the company in January 2024.

Meier has served as Chairman of, and member of the Audit and Compensation Committees of, Santhera Pharmaceuticals

Holding AG (SIX:

SANN), a publicly listed Swiss specialty pharmaceutical company focused on the development and commercialization of innovative

medicines for rare neuromuscular and pulmonary diseases.

Meier has served on the board of Santhera since 2017 and stepped down as

the company’s CEO in November 2019 after having served 15 years as executive manager, the last 8 years as CEO.

became managing partner of Viopas Venture Consulting GmbH, a Swiss consultancy and advisory firm for the healthcare industry.

Meier has served as a board member of Novaremed AG, a privately held Swiss company developing innovative treatment options for the

management of chronic pain and alternatives to opioids.

Meier has served on Novaremed’s Audit Committee since October 2021 and

became Executive Chairman of the company in January 2024.

Since January 2022, Dr.

Meier also serves

on the board of Visgenx Inc.

In September 2021, he co-founded SEAL Therapeutics AG, a privately owned Swiss gene therapy company

for which he also serves as Chairman.

Meier also serves on the board of Visgenx Inc.

In September 2021, he co-founded SEAL Therapeutics AG, a privately owned Swiss gene therapy company for which he also serves as Chairman.

Between July 2020 and November 2021, he served as Chairman of privately held Pharmabiome AG (Switzerland).

Meier has a PhD in Biology and qualified as lecturer in neurosciences at the Biozentrum, University of Basel (Switzerland).

brings to our board experience as an internationally recognized scientist with track record in clinical research of orphan diseases.

Ajit Singh, one

of our directors since February 7, 2024, is a Partner at Silicon Valley based Artiman Ventures, focused on early-stage technology and

life science investments, with over $1 billion in assets under management.

Besides serving on the board of directors of Artiman portfolio

companies, he has served on the boards of Sofie Biosciences, a PET radiopharmaceuticals company focused on Oncology and Neurology, Leo

Cancer Care, focused on radiation oncology since 2013, Artidis, an oncology diagnostics company with nanomechanical biomarkers for cancer,

and Chronus Health, in the area of Point-of-Care diagnostics since 2023.

He also serves on the Board of Trustees of American Association

for Cancer Research (AACR) Foundation, the oldest and the largest cancer research organization globally.

Singh is an Adjunct Professor

in the School of Medicine at Stanford where he teaches clinical diagnostics and entrepreneurship.

Meier has a PhD in Biology

and qualified as lecturer in neurosciences at the Biozentrum, University of Basel (Switzerland).

Meier brings to our board experience

as an internationally recognized scientist with track record in clinical research of orphan diseases.

Ajit Singh, one of our directors since

February 7, 2024, is a Partner at Silicon Valley based Artiman Ventures, focused on early-stage technology and life science investments,

with over $1 billion in assets under management.

Besides serving on the board of directors of Artiman portfolio companies, he has served

on the boards of Sofie Biosciences, a PET radiopharmaceuticals company focused on Oncology and Neurology, Leo Cancer Care, focused on

radiation oncology since 2013, Artidis, an oncology diagnostics company with nanomechanical biomarkers for cancer, and Chronus Health,

in the area of Point-of-Care diagnostics since 2023.

He also serves on the Board of Trustees of American Association for Cancer Research

(AACR) Foundation, the oldest and the largest cancer research organization globally.

Singh is an Adjunct Professor in the School of

Medicine at Stanford where he teaches clinical diagnostics and entrepreneurship.

In the past, Dr.

Singh has served as

a Lead Director on the Board of Directors of Max Healthcare, and as a Senior Advisor to the Tata Trusts Cancer program, which developed

a “plan centrally, deliver locally” platform for cancer care, and delivered it via comprehensive cancer centers built bespoke

with funding from the Tata Group.

Singh has served as a Lead Director

on the board of directors of Max Healthcare, and as a Senior Advisor to the Tata Trusts Cancer program, which developed a “plan

centrally, deliver locally” platform for cancer care, and delivered it via comprehensive cancer centers built bespoke with funding

from the Tata Group.

Until 2023, he also served on the board of directors of Cadila Pharmaceuticals.

Prior to joining Artiman,

Singh was the President and CEO of BioImagene, a company specializing in AI-based Cancer Diagnostics, based in California.

was acquired by Roche Pharmaceuticals in September 2010.

Prior to joining Artiman, Dr.

was the President and CEO of BioImagene, a company specializing in AI-based Cancer Diagnostics, based in California.

BioImagene was acquired

by Roche Pharmaceuticals in September 2010.

Before BioImagene, Dr.

Singh spent nearly twenty years at Siemens in various

roles, in the United States and Germany, most recently as the global CEO of Siemens Oncology, and Siemens Digital Imaging Systems.

transitioning to these executive responsibilities, Dr.

Singh spent several years in R&D at Siemens Research in Princeton, responsible

for research in the areas of artificial intelligence and robotics.

During this time, he concurrently served as an adjunct faculty at Princeton

Singh spent nearly twenty years at Siemens in various roles, in the

United States and Germany, most recently as the global CEO of Siemens Oncology, and Siemens Digital Imaging Systems.

Before transitioning

to these executive responsibilities, Dr.

Singh spent several years in R&D at Siemens Research in Princeton, responsible for research

in the areas of artificial intelligence and robotics.

During this time, he concurrently served as an adjunct faculty at Princeton University.

Singh has a Ph.D.

in Computer Science from Columbia University, a Master’s degree in Computer Engineering from Syracuse

University, and a Bachelor’s in Electrical Engineering from Indian Institute of Technology (IIT) in Varanasi, India.

He has published

two books and numerous refereed articles and holds five patents.

His Top-10 Book Review is carried by various blogs and reading journals

in December every year.

Singh brings to our board significant experience in the biotech industry and diagnostic field, particularly

in a commercial execution capacity.

in Computer Science from Columbia University, a Master’s degree in Computer Engineering from Syracuse University,

and a Bachelor’s in Electrical Engineering from Indian Institute of Technology (IIT) in Varanasi, India.

He has published two books

and numerous refereed articles and holds five patents.

His Top-10 Book Review is carried by various blogs and reading journals in December

Singh brings to our board significant experience in the biotech industry and diagnostic field, particularly in a commercial

execution capacity.

Board of Directors and Corporate Governance

Our business and affairs are

organized under the direction of our board of directors (“ Board ”), which currently consists of five members.

is divided into three classes, Class I, Class II and Class III, with members of each class serving staggered three-year terms.

Our directors

are divided among the three classes as follows:

● the Class I directors are Simon

Tarsh and Thomas Meier, and their term will expire at our 2025 annual meeting of stockholders;

● the Class II director is James

Sapirstein, and his term will expire at our 2026 annual meeting of stockholders;

● the Class III directors are

Timothy Ramdeen and Ajit Singh, and their term will expire at our 2024 annual meeting of stockholders.

Our Amended and Restated Certificate

of Incorporation and our Amended and Restated Bylaws provide that the authorized number of directors may be changed only by resolution

of the Board.

Our directors hold office until the earlier of their death, resignation, removal, or disqualification, or until their successors

have been elected and qualified.

Our board of directors does not have a formal policy on whether the roles of Chief Executive Officer

and Chairman of our Board should be separate.

The primary responsibilities of our Board are to provide oversight, strategic guidance,

counselling, and direction to our management.

We have no formal policy regarding

board diversity.

Our priority in selection of board members is identification of members who will further the interests of our stockholders

through his or her established record of professional accomplishment, the ability to contribute positively to the collaborative culture

among board members, knowledge of our business and understanding of the competitive landscape.

Our business and affairs are organized under the

direction of our Board, which currently consists of five members.

Our Board is divided into three classes, Class I, Class II and Class

III, with members of each class serving staggered three-year terms.

Our directors are divided among the three classes as follows:

the Class I directors are Simon Tarsh and Thomas Meier, and their term will expire at our 2025 annual meeting of stockholders;

the Class II director is Andrew Oakley, and his term will expire at our 2026 annual meeting of stockholders;

the Class III directors are Timothy Ramdeen and Ajit Singh, and their term will expire at our 2025 annual meeting of stockholders.

Our Amended and Restated Certificate of Incorporation

and our Amended and Restated Bylaws provide that the authorized number of directors may be changed only by resolution of the Board.

directors hold office until the earlier of their death, resignation, removal, or disqualification, or until their successors have been

elected and qualified.

Our board of directors does not have a formal policy on whether the roles of Chief Executive Officer and Chairman

of our Board should be separate.

The primary responsibilities of our Board are to provide oversight, strategic guidance, counselling,

and direction to our management.

We have no formal policy regarding board diversity.

Our priority in selection of board members is identification of members who will further the interests of our stockholders through his

or her established record of professional accomplishment, the ability to contribute positively to the collaborative culture among board

members, knowledge of our business and understanding of the competitive landscape.

Directors and Executive Officers Qualifications

We believe that the collective

skills, experiences, and qualifications of our directors provide our Board with the expertise and experience necessary to advance the

interests of our stockholders.

In selecting directors, the Board considers candidates that possess qualifications and expertise that will

enhance the composition of the Board.

Nominees for director will be selected on the basis of, among other things, leadership experience,

knowledge, skills, expertise, integrity, diversity, ability to make independent analytical inquiries, understanding of the Company’s

business environment and willingness to devote adequate time and effort to Board responsibilities.

The Nominating & Corporate Governance

Committee may require certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise

from time to time and will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members.

We believe that our directors should have the highest professional and personal ethics and values, consistent with our longstanding values

and standards.

They should have broad experience at the policy-making level in business, exhibit commitment to enhancing stockholder value

and have sufficient time to carry out their duties and to provide insight and practical wisdom based on their past experience.

We believe that the collective skills, experiences,

and qualifications of our directors provide our Board with the expertise and experience necessary to advance the interests of our stockholders.

In selecting directors, the Board considers candidates that possess qualifications and expertise that will enhance the composition of

Nominees for director will be selected on the basis of, among other things, leadership experience, knowledge, skills, expertise,

integrity, diversity, ability to make independent analytical inquiries, understanding of the Company’s business environment and

willingness to devote adequate time and effort to Board responsibilities.

The Nominating & Corporate Governance Committee may require

certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and

will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members.

We believe that

our directors should have the highest professional and personal ethics and values, consistent with our longstanding values and standards.

They should have broad experience at the policy-making level in business, exhibit commitment to enhancing stockholder value and have sufficient

time to carry out their duties and to provide insight and practical wisdom based on their past experience.

Committees of the Board

Our Board has established three

standing committees—audit, compensation and nominating and corporate governance—each of which operates under a charter that

has been adopted by our Board.

Copies of each committee’s charter are posted on the “Investor Relations” section of

our website, which is located at https://onconetix.com/corporate-governance/governance-overview .

Each committee has the composition

and responsibilities described below.

Our Board has established three standing committees—audit,

compensation and nominating and corporate governance—each of which operates under a charter that has been adopted by our Board.

Copies of each committee’s charter are posted on the “Investor Relations” section of our website, which is located at

https://onconetix.com/corporate-governance/governance-overview .

Each committee has the composition and responsibilities described

Our Board may from time to time establish other committees.

Audit Committee

Our audit committee (“ Audit Committee ”) consists

of Simon Tarsh, who is the chair of the committee, Timothy Ramdeen, and James Sapirstein.

Our Board has determined that each of the members

of our Audit Committee satisfies the Nasdaq Marketplace Rules and SEC independence requirements.

The functions of this committee include,

among other things:

● evaluating the performance,

independence and qualifications of our independent auditors and determining whether to retain our existing independent auditors or engage

new independent auditors;

● reviewing and approving the

engagement of our independent auditors to perform audit services and any permissible non-audit services;

● reviewing our annual and quarterly

financial statements and reports, including the disclosures contained under the caption “Management’s Discussion and Analysis

of Financial Condition and Results of Operations” and discussing the statements and reports with our independent auditors and management;

● reviewing with our independent

auditors and management significant issues that arise regarding accounting principles and financial statement presentation and matters

concerning the scope, adequacy, and effectiveness of our financial controls;

● reviewing and approving, in

accordance with the Company’s policies, any related party transaction as defined by applicable rules and regulations

● reviewing our major financial

risk exposures, including the guidelines and policies to govern the process by which risk assessment and risk management is implemented;

● reviewing and evaluating on

an annual basis the performance of the audit committee, including compliance of the audit committee with its charter.

The Board has determined that

Simon Tarsh qualifies as an “audit committee financial expert” within the meaning of applicable SEC regulations and meets

Our audit committee (“ Audit Committee ”)

consists of Simon Tarsh, who is the chair of the committee, Timothy Ramdeen, and Andrew Oakley.

Our Board has determined that each of

the members of our Audit Committee satisfies the Nasdaq Marketplace Rules and SEC independence requirements.

The functions of this committee

include, among other things:

evaluating the performance, independence and qualifications of our independent auditors and determining whether to retain our existing independent auditors or engage new independent auditors;

reviewing and approving the engagement of our independent auditors to perform audit services and any permissible non-audit services;

reviewing our annual and quarterly financial statements and reports, including the disclosures contained under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and discussing the statements and reports with our independent auditors and management;

reviewing with our independent auditors and management significant issues that arise regarding accounting principles and financial statement presentation and matters concerning the scope, adequacy, and effectiveness of our financial controls;

reviewing and approving, in accordance with the Company’s policies, any related party transaction as defined by applicable rules and regulations

reviewing our major financial risk exposures, including the guidelines and policies to govern the process by which risk assessment and risk management is implemented;

reviewing and evaluating on an annual basis the performance of the audit committee, including compliance of the audit committee with its charter.

The Board has determined

that Simon Tarsh qualifies as an “audit committee financial expert” within the meaning of applicable SEC regulations and meets

the financial sophistication requirements of the Nasdaq Marketplace Rules.

4 unchanged sentences

Compensation Committee

Our compensation committee

(“ Compensation Committee ”) consists of James Sapirstein, who is the chair of the committee, Simon Tarsh, and Timothy

Our board of directors has determined that each of the members of our Compensation Committee is an outside director, as defined

pursuant to Section 162(m) of the Internal Revenue Code of 1986, as amended, or the Code, and satisfies the Nasdaq Marketplace Rules independence

requirements.

The functions of this committee include, among other things:

● reviewing, modifying, and approving

(or if it deems appropriate, making recommendations to the full board of directors regarding) our overall compensation strategy and policies;

● reviewing and approving the

compensation, the performance goals, and objectives relevant to the compensation, and other terms of employment of our executive officers;

● reviewing and approving (or

if it deems appropriate, making recommendations to the full board of directors regarding) the equity incentive plans, compensation plans

and similar programs advisable for us, as well as modifying, amending, or terminating existing plans and programs;

● reviewing and approving the

terms of any employment agreements, severance arrangements, change in control protections and any other compensatory arrangements for

our executive officers;

● reviewing with management and

approving our disclosures under the caption “Compensation Discussion and Analysis” in our periodic reports or proxy statements

to be filed with the SEC;

● preparing the report that the

SEC requires in our annual proxy statement.

Our compensation committee (“ Compensation

Committee ”) consists of Thomas Meier, who is the chair of the committee, Simon Tarsh, and Timothy Ramdeen.

Our board of directors

has determined that each of the members of our Compensation Committee is an outside director, as defined pursuant to Section 162(m) of

the Internal Revenue Code of 1986, as amended, or the Code, and satisfies the Nasdaq Marketplace Rules independence requirements.

functions of this committee include, among other things:

reviewing, modifying, and approving (or if it deems appropriate, making recommendations to the full board of directors regarding) our overall compensation strategy and policies;

reviewing and approving the compensation, the performance goals, and objectives relevant to the compensation, and other terms of employment of our executive officers;

reviewing and approving (or if it deems appropriate, making recommendations to the full board of directors regarding) the equity incentive plans, compensation plans and similar programs advisable for us, as well as modifying, amending, or terminating existing plans and programs;

reviewing and approving the terms of any employment agreements, severance arrangements, change in control protections and any other compensatory arrangements for our executive officers;

reviewing with management and approving our disclosures under the caption “Compensation Discussion and Analysis” in our periodic reports or proxy statements to be filed with the SEC;

preparing the report that the SEC requires in our annual proxy statement.

Nominating and Corporate Governance Committee

Our nominating and corporate

governance committee (“ Nominating Committee ”) consists of Timothy Ramdeen, who is the chair of the committee, James

Sapirstein and Simon Tarsh.

Our Board has determined that each of the members of this committee satisfies the Nasdaq Marketplace Rules

independence requirements.

The functions of this committee include, among other things:

● identifying, reviewing, and

evaluating candidates to serve on our board of directors consistent with criteria approved by our board of directors;

● evaluating director performance

on the board and applicable committees of the board and determining whether continued service on our board is appropriate;

● evaluating, nominating, and

recommending individuals for membership on our board of directors;

● evaluating nominations by stockholders

of candidates for election to our board of directors.

Our nominating and corporate governance committee

(“ Nominating Committee ”) consists of Timothy Ramdeen, who is the chair of the committee, and Simon Tarsh.

has determined that each of the members of this committee satisfies the Nasdaq Marketplace Rules independence requirements.

The functions

of this committee include, among other things:

identifying, reviewing, and evaluating candidates to serve on our board of directors consistent with criteria approved by our board of directors;

evaluating director performance on the board and applicable committees of the board and determining whether continued service on our board is appropriate;

evaluating, nominating, and recommending individuals for membership on our board of directors;

evaluating nominations by stockholders of candidates for election to our board of directors.

Board Leadership Structure

Our board of directors is free to select the Chairman of the board

of directors and the Chief Executive Officer in a manner that it considers to be in the best interests of our company at the time of selection.

Currently, Ralph Schiess serves as our Interim Chief Executive Officer and James Sapirstein serves as our non-executive Chairman.

Our board of directors is free to select the Chairman

of the board of directors and the Chief Executive Officer in a manner that it considers to be in the best interests of our company at

the time of selection.

Currently, Karina Fedasz serves as our Interim Chief Executive Officer and Interim Chief Financial Officer.

five members of our board of directors have been deemed to be “independent” by the board of directors, which we believe provides

sufficient independent oversight of our management.

Our board of directors, as

a whole and also at the committee level, plays an active role overseeing the overall management of our risks.

Our Audit Committee reviews

risks related to financial and operational items with our management and our independent registered public accounting firm.

of directors is in regular contact with our Chief Executive Officer, who reports directly to the board of directors and supervises

day-to-day risk management.

Our board of directors, as a whole and also at

the committee level, plays an active role overseeing the overall management of our risks.

Our Audit Committee reviews risks related to

financial and operational items with our management and our independent registered public accounting firm.

Our board of directors is in

regular contact with our Chief Executive Officer, who reports directly to the board of directors and supervises day-to-day risk management.

Role of Board in Risk Oversight Process

We face a number of risks,

including those described under the caption “Risk Factors” contained elsewhere in this Report.

Our board of directors believes

that risk management is an important part of establishing, updating, and executing our business strategy.

Our board of directors has oversight

responsibility relating to risks that could affect the corporate strategy, business objectives, compliance, operations, and the financial

condition and performance of our Company.

Our board of directors focuses its oversight on the most significant risks facing us and, on

our processes to identify, prioritize, assess, manage, and mitigate those risks.

Our board of directors receives regular reports from

members of our senior management on areas of material risk to us, including strategic, operational, financial, legal and regulatory risks.

While our board of directors has an oversight role, management is principally tasked with direct responsibility for management and assessment

of risks and the implementation of processes and controls to mitigate their effects on us.

Our board is generally responsible

for the oversight of corporate risk in its review and deliberations relating to our activities.

Our principal source of risk falls into

two categories, financial and product commercialization.

We face a number of risks, including those described

under the caption “Risk Factors” contained elsewhere in this Report.

Our board of directors believes that risk management

is an important part of establishing, updating, and executing our business strategy.

Our board of directors has oversight responsibility

relating to risks that could affect the corporate strategy, business objectives, compliance, operations, and the financial condition and

performance of our Company.

Our board of directors focuses its oversight on the most significant risks facing us and, on our processes

to identify, prioritize, assess, manage, and mitigate those risks.

Our board of directors receives regular reports from members of our

senior management on areas of material risk to us, including strategic, operational, financial, legal and regulatory risks.

board of directors has an oversight role, management is principally tasked with direct responsibility for management and assessment of

risks and the implementation of processes and controls to mitigate their effects on us.

Our board is generally responsible for the oversight

of corporate risk in its review and deliberations relating to our activities.

Our principal source of risk falls into two categories,

financial and product commercialization.

Our Audit Committee oversees management of financial risks;

our board regularly

reviews information regarding our cash position, liquidity, and operations, as well as the risks associated with each.

The board regularly

reviews plans, results and potential risks related to our product offerings, growth and strategies.

Our Compensation Committee oversees

risk management as it relates to our compensation plans, policies and practices for all employees including executives and directors,

particularly whether our compensation programs may create incentives for our employees to take excessive or inappropriate risks which

could have a material adverse effect on our company.

our board regularly reviews information

regarding our cash position, liquidity, and operations, as well as the risks associated with each.

The board regularly reviews plans,

results and potential risks related to our product offerings, growth and strategies.

Our Compensation Committee oversees risk management

as it relates to our compensation plans, policies and practices for all employees including executives and directors, particularly whether

our compensation programs may create incentives for our employees to take excessive or inappropriate risks which could have a material

adverse effect on our company.

Board Member Attendance at Annual Stockholder Meetings

Although we do not have a formal policy regarding director attendance

at annual stockholder meetings, directors are encouraged to attend these annual meetings.

All of our directors attended our 2024 virtual

annual meeting of stockholders held on September 5, 2024

Number of Meetings

During the fiscal year ended December 31, 2024,

our Board met eighteen times, the audit committee met five times, the compensation committee met four times, and the nominating and corporate

governance committee met two times.

In the fiscal year ended December 31, 2024, each of our directors attended at least 75% of the meetings

of the Board and committees on which he served as a member.

Code of Business Conduct and Ethics

We have adopted a written

code of business conduct and ethics that applies to our directors, officers, and employees, including our principal executive officer,

principal financial officer, principal accounting officer or controller, or persons performing similar functions.

The code of business

conduct and ethics is posted on our website at www.onconetix.com .

We expect that any amendments or waivers to the code that are

required by law or Nasdaq Marketplace Rules will be disclosed on our website.

We have adopted a written code of business conduct

and ethics that applies to our directors, officers, and employees, including our principal executive officer, principal financial officer,

principal accounting officer or controller, or persons performing similar functions.

The code of business conduct and ethics is posted

on our website at www.onconetix.com .

We expect that any amendments or waivers to the code that are required by law or Nasdaq Marketplace

Rules will be disclosed on our website.

Insider Trading Policy

On December 1, 2023, we adopted

insider trading policies and procedures governing the purchase, sale, and/or other dispositions of our securities by directors, officers,

and employees, which are reasonably designed to promote compliance with insider trading laws, rules and regulations, and applicable Nasdaq

listing standards (the “ Insider Trading Policy ”).

The foregoing description of

the Insider Trading Policy does not purport to be complete and is qualified in its entirety by the terms and conditions of the Insider

Trading Policy, a copy of which is attached hereto as Exhibit 19 and is incorporated herein by reference.

We have adopted insider trading policies and procedures

governing the purchase, sale, and/or other dispositions of our securities by directors, officers, and employees, which are reasonably

designed to promote compliance with insider trading laws, rules and regulations, and applicable Nasdaq listing standards (the “ Insider

Trading Policy ”).

The foregoing

description of the Insider Trading Policy does not purport to be complete and is qualified in its entirety by the terms and conditions

of the Insider Trading Policy, a copy of which is attached hereto as Exhibit 19 and is incorporated herein by reference.

Compensation Recovery Policy

On January 17, 2024, our Board adopted a policy

(commonly known as a “clawback” policy) which provides for the recovery of erroneously awarded incentive compensation to certain

of our officers in the event that we are required to prepare an accounting restatement due to material noncompliance by us with any financial

reporting requirements under the federal securities laws.

This policy is designed to comply with Section 10D of the Securities Exchange

Act of 1934, as amended, related rules and the listing standards of Nasdaq Stock Market or any other securities exchange on which our

shares are listed in the future.

The policy is administered by our Board or, if so designated by the Board, the Compensation Committee.

Any determinations made by the Board shall be final and binding on all affected individuals.

The individuals covered by the policy (the “Covered

Executives”) are any current or former employee who is or was identified as our president, principal financial officer, principal

accounting officer (or if there is no such accounting officer, the controller), any vice-president in charge of a principal business unit,

division, or function (such as sales, administration, or finance), any other officer who performs a policy-making function, or any other

person (including any executive officer of our subsidiaries or affiliates) who performs similar policy-making functions for us.

The policy covers our recoupment of “Incentive-Based

Compensation” (as defined in the policy) received by a person after beginning service as a Covered Executive and who served as a

Covered Executive at any time during the performance period for that Incentive-Based Compensation.

In the event we are required to prepare

an accounting restatement, the policy requires us to recover, reasonably promptly, any excess incentive compensation (as determined by

our Board or Compensation Committee) received by any Covered Executive during the three completed fiscal years immediately preceding the

date on which we are required to prepare such accounting restatement.

The foregoing description of our clawback does

not purport to be complete and is qualified in its entirety by the terms and conditions of such policy, a copy of which is filed as an

exhibit to the registration statement filed on October 8, 2021 and is incorporated herein by reference.

Communications with the Board

Any stockholder or any other interested party

who desires to communicate with our Board, our non-management directors, or any specified individual director, may do so by directing

such correspondence to the attention of the Interim Chief Executive Officer, Onconetix, Inc., 201 E.

Fifth Street, Suite 1900, Cincinnati,

The Interim Chief Executive Officer will forward the communication to the appropriate director or directors as appropriate.

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange

Act requires the Company’s directors, executive officers, and persons who own more than 10% of a registered class of the Company’s

equity securities, to file with the SEC reports of beneficial ownership and reports of changes in beneficial ownership in the Company’s

Based solely upon a review of Forms 3, 4 and 5, and amendments thereto, filed electronically with the SEC during the year

ended December 31, 2023, the Company believes that all Section 16(a) filings applicable to its directors, officers, and 10% stockholders

were filed on a timely basis during the year ended December 31, 2023, except that Ralph Schiess filed one late Form 3.

Section 16(a) of the Exchange Act requires the

Company’s directors, executive officers, and persons who own more than 10% of a registered class of the Company’s equity securities,

to file with the SEC reports of beneficial ownership and reports of changes in beneficial ownership in the Company’s securities.

Based solely upon a review of Forms 3, 4 and 5, and amendments thereto, filed electronically with the SEC during the year ended December

31, 2024, the Company believes that all Section 16(a) filings applicable to its directors, officers, and 10% stockholders were filed on

a timely basis during the year ended December 31, 2024, except that due to an administrative oversight, a Form 4 was not timely filed

to report a transaction that occurred in December 2024 by each of Christian Brühlmann and Ralph Schiess.

Executive Compensation.

Summary Compensation Table

The following table sets forth total compensation paid to our named

executive officers for the years ended December 31, 2023 and 2022.

Individuals we refer to as our “named executive officers”

include (i) all individuals serving as our Chief Executive Officer during the fiscal year ended December 31, 2023;

(ii) our two most highly

compensated executive officers other than our Chief Executive Officer who were serving as executive officers at the end of the fiscal

year ended December 31, 2023, whose salary and bonus for services rendered in all capacities exceeded $100,000 during the fiscal year

ended December 31, 2023 and (iii) up to two of our most highly compensated executive officers other than our Chief Executive Officer who

served as executive officers during the fiscal year ended December 31, 2023 but not at the end of the fiscal year ended December 31, 2023

The following table sets forth total compensation

paid to our named executive officers for the years ended December 31, 2024 and 2023.

Individuals we refer to as our “named executive

officers” include (i) all individuals serving as our Chief Executive Officer during the fiscal year ended December 31, 2024;

our two most highly compensated executive officers other than our Chief Executive Officer who were serving as executive officers at the

end of the fiscal year ended December 31, 2024, whose salary and bonus for services rendered in all capacities exceeded $100,000 during

the fiscal year ended December 31, 2024 and (iii) up to two of our most highly compensated executive officers other than our Chief Executive

Officer who served as executive officers during the fiscal year ended December 31, 2024 but not at the end of the fiscal year ended December

31, 2024 whose salary and bonus for services rendered in all capacities exceeded $100,000 during the fiscal year ended December 31, 2024.

Name and Principal Position

Joseph Hernandez (2)

Former Chief Executive Officer

Ralph Schiess (2)

Former Chief Executive Officer and Former Chief Science Officer

Neil Campbell (4)

158,333 (5)

Former Chief Executive Officer

Jon Garfield (4)

Former Chief Financial Officer

Bruce Harmon (6)

Chief Financial Officer

Erin Henderson (5)

Former Chief Business Officer and Corporate Secretary

Former Chief Financial Officer

Christian Brühlmann (8)

Former Chief Strategy Officer

Karina Fedasz (9)

Interim Chief Executive Officer and Interim Chief Financial Officer

This figure represents the aggregate grant date fair value of stock-based awards granted in the fiscal year, computed in accordance with the provisions of FASB ASC 718.

Assumptions used in the calculation of these amounts are included in the notes to our consolidated financial statements included elsewhere in this Report.

Hernandez resigned as Chief Executive Officer on August 16, 2023.

Does not include restricted stock units (“RSUs”) granted to Ralph Schiess and Christian Brühlmann, as such RSUs were granted in exchange for options to purchase shares of Proteomedix AG (“PMX”), pursuant to the Share Exchange Agreement, dated December 13, 2023, between the Company and PMX, and not as compensation for services rendered to the Company.

Schiess was appointed as Interim Chief Executive Officer on January 12, 2024 and as Chief Science Officer on December 15, 2023.

His salary for 2023 is noted as pro-rata for such time as effective in 2023.

The bonus for Mr.

Schiess noted in 2023 is for the amount earned in 2023 but paid in full in 2024.

Schiess was awarded a bonus of $40,000 for his role as Interim Chief Executive Officer.

A 2024 bonus for services rendered as Chief Science Officer during the fiscal year ended December 31, 2024 is omitted as it cannot be calculated because it has not yet been determined.

If and when such amount becomes calculable in whole or part, the Company will disclose such amounts on a Current Report on Form 8-K

Campbell was appointed by the Board to serve as Chief Executive Officer on October 4, 2023, and resigned on January 10, 2024.

Campbell received a sign-on bonus of $75,000.

Garfield resigned as Chief Financial Officer on October 4, 2023.

Garfield received severance of $72,500 upon his resignation.

Henderson resigned as Chief Business Officer on December 21, 2023.

Harmon was appointed by the Board to serve as Chief Financial Officer on October 4, 2023

Employment Agreements of Executive Officers

Set forth below is a summary

of many of the material provisions of the employment agreements with our named executive officers and other executive officers, which

summaries do not purport to contain all of the material terms and conditions of each such agreement.

Joseph Hernandez

Effective upon the closing

of our initial public offering, we entered into an employment agreement with Mr.

Hernandez (the “Hernandez Employment Agreement”),

pursuant to which he was employed as the Chief Executive Officer of the Company, which superseded Mr.

Hernandez’s prior consulting

agreement with the Company.

The Hernandez Employment Agreement provided for an annual base salary, subject to annual increases in the

discretion of our compensation committee, the Company, and an annual performance bonus.

Pursuant to the Hernandez Employment Agreement,

following the completion of our initial public offering, Mr.

Hernandez’s base salary was $595,000.

The annual performance bonus

was up to 50% of annual base salary (the “Target Annual Bonus”), with the actual bonus being based upon the level of achievement

of annual Company and individual performance objectives for such fiscal year, as determined by our compensation committee.

In the event that Mr.

employment was terminated by the Company without cause (as defined in the Hernandez Employment Agreement), or if Mr.

Hernandez terminated

his employment for “Good Reason” (as defined in the Hernandez Employment Agreement), in addition to accrued unpaid salary,

reimbursements and vacation days, he would be entitled to certain severance payments and benefits, including:

(i) any unpaid annual bonus

in respect of any completed fiscal year that has ended prior to the date of such termination;

(ii) subject to certain conditions set forth

in the Hernandez Employment Agreement, an amount equal to (A) the Target Annual Bonus otherwise for the fiscal year in which such termination

occurred, assuming Mr.

Hernandez had remained employed through the applicable payment date, multiplied by (B) a fraction, the numerator

of which is the number of days elapsed from the commencement of such fiscal year through the date of such termination and the denominator

of which is 365 (or 366, as applicable);

(iii) a payment equal to twelve (12) months of his base salary;

and (iv) payment of an amount

equal to the difference between the monthly COBRA premium cost and the monthly contribution paid by active employees for the same coverage

for eighteen months following his termination.

The Hernandez Employment Agreement also provides that if a change in control (as defined

in the Hernandez Employment Agreement) occurs, and during the period commencing three months prior to a change in control and ending on

the eighteen (18)-month anniversary of the change in control, Mr.

Hernandez is terminated without cause or he resigns for good reason,

Hernandez is entitled to (i) any unpaid annual bonus in respect of any completed fiscal year that has ended prior to the date of such

(ii) subject to certain conditions set forth in the Hernandez Employment Agreement, an amount equal to (A) the Target Annual

Bonus otherwise for the fiscal year in which such termination occurred, assuming Mr.

Hernandez had remained employed through the applicable

payment date, multiplied by (B) a fraction, the numerator of which is the number of days elapsed from the commencement of such fiscal

year through the date of such termination and the denominator of which is 365 (or 366, as applicable);

(iii) severance of 18 months’

and (iv) payment of an amount equal to the difference between the monthly COBRA premium cost and the monthly contribution paid

by active employees for the same coverage for eighteen months following his termination.

Additionally, any unvested portion of the equity

awards held subject to time-vesting held by Mr.

Hernandez would automatically vest.

The Hernandez Employment

Agreement is governed by the laws of the State of Ohio and contains non-solicitation and non-competition covenants (each of which remains

in effect during the term of employment and for six months following termination of employment) and confidentiality, trade secrets and

assignment of intellectual property clauses.

Pursuant to the non-solicitation

and non-competition covenants, Mr.

Hernandez agreed to not directly or indirectly solicit any comparable business from a broad category

of customers, request or advise customers to curtail, cancel, or withdraw its business from Blue Water Vaccines Inc., aid any other entity

in obtaining business from customers that is comparable or similar to any products or services provided by the Company or otherwise interfere

with any transaction, agreement, business relationship, and/or business opportunity between the Company and any customer or potential

customer of the Company.

During the term of employment

and for a period of six months after termination (“the Post-Termination Restricted Period”), Mr.

Hernandez is prohibited from

recruiting, encouraging, soliciting, or inducing, or in any manner attempting to recruit, encourage, solicit, or induce, any person employed

by or engaged by the Company or its subsidiaries to terminate such person’s employment or services (or in the case of a consultant,

materially reducing such services) with the Company or its subsidiaries, hiring, or engaging any individual who was employed by or providing

services to Blue Water Vaccines Inc.

or its subsidiaries within the six (6) month period prior to the date of such hiring or engagement,

or encouraging, soliciting, or inducing, or in any manner attempting to encourage, solicit, or induce, any current or prospective client,

customer, licensee, supplier, or other business relation of the Company or its subsidiaries, or any such relation that was a client, customer,

licensee or other business relationship within the prior six (6) month period to cease doing business with or reduce the amount of business

conducted with the Company or its subsidiaries, or in any way interfering with the relationship between any such party and the Company

or its subsidiaries.

Campbell received a severance payment of $158,333,

Harmon was appointed by the Board to serve as Chief Financial Officer on October 4, 2023 and resigned as Chief Financial Officer on June 8, 2024.

Harmon received a severance of $66,153 upon his resignation.

Brühlmann was appointed as Chief Strategy Officer on December 15, 2023.

His salary for 2023 is noted as pro-rata for such time as effective in 2023.

The bonus for Mr.

Brühlmann noted in 2023 is for the amount earned in 2023 but paid in full in 2024.

A 2024 bonus for services rendered as Chief Strategy Officer during the fiscal year ended December 31, 2024 is omitted as it cannot be calculated because it has not yet been determined.

When such amount becomes calculable in whole or part, the Company will disclose such amounts on a Current Report on Form 8-K.

Fedasz was appointed Interim Chief Financial Officer effective June 10, 2024 and Interim Chief Executive Officer effective April 2, 2025.

Employment Agreements of Named Executive Officers

Set forth below is a summary of many of the material

provisions of the employment agreements with our named executive officers and other executive officers, of which summaries do not purport

to contain all of the material terms and conditions of each such agreement.

Neil Campbell

In connection with Dr.

appointment, the Company and Dr.

Campbell entered into an employment agreement (the “Campbell Employment Agreement”), pursuant

Campbell served as President and Chief Executive Officer of the Company and was paid a signing bonus of $75,000 and an annual

base salary of $475,000.

Campbell’s appointment,

the Company and Dr.

Campbell entered into an employment agreement (the “Campbell Employment Agreement”), pursuant to which

Campbell served as President and Chief Executive Officer of the Company and was paid a signing bonus of $75,000 and an annual base

salary of $475,000.

In addition, Dr.

Campbell was entitled to receive, subject to employment by the Company on the applicable date

of bonus payout, an annual target discretionary bonus of up to 50% of his annual base salary, payable at the discretion of the Compensation

Campbell was entitled to receive, subject to employment by the Company on the applicable date of

the bonus payout, an annual target discretionary bonus of up to 50% of his annual base salary, payable at the discretion of the Compensation

Committee of the Board.

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to its employees generally, and to receive paid time off annually.

Pursuant to the Campbell Employment

Agreement, Dr.

Campbell was granted a long-term equity incentive grant in the form of an option to purchase 3% of the total outstanding

shares of the Company’s common stock as of the Effective Date.

Such award vests in quarterly increments over a period of three years

from the Effective Date, subject to Dr.

Pursuant to the Campbell Employment Agreement,

Campbell was granted a long-term equity incentive grant in the form of an option to purchase 3% of the total outstanding shares of

the Company’s common stock as of the Effective Date.

Such award vests in quarterly increments over a period of three years from

the Effective Date, subject to Dr.

Campbell’s continued employment by the Company on the applicable vesting date.

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on the grant date.

Pursuant to the Campbell Employment

Agreement, Dr.

Pursuant to the Campbell Employment Agreement,

Campbell agreed to be bound by certain non-compete and non-solicitation covenants contained therein.

as of January 10, 2024, Dr.

Campbell resigned as President and Chief Executive Officer and a member of the Board.

The Company entered

into a Release of Claims with Dr.

Campbell, pursuant to which Dr.

Campbell will receive a one-time severance payment of $158,333.

Effective upon the closing

of our initial public offering, we entered into an employment agreement with Mr.

Garfield (the “Garfield Employment Agreement”),

pursuant to which he was employed as the Chief Financial Officer of the Company.

The Garfield Employment Agreement provided for an annual

base salary, subject to annual increases in the discretion of our compensation committee, the Company, and an annual performance bonus.

Pursuant to the Garfield Employment Agreement, following the completion of our initial public offering, Mr.

Garfield’s base salary

was $435,000.

The annual performance bonus was up to 50% of annual base salary (the “Target Annual Bonus”), with the actual

bonus being based upon the level of achievement of annual Company and individual performance objectives for such fiscal year, as determined

by our compensation committee.

as of October 4, 2023, Mr.

Garfield resigned as Chief Financial Officer of the Company.

The Company and Mr.

Garfield entered into a Separation

Agreement, which provides for two months of severance payment.

Effective as of January 10, 2024, Dr.

Campbell resigned as President

and Chief Executive Officer and a member of the Board.

The Company entered into a Release of Claims with Dr.

Campbell, pursuant to which

Campbell will receive a severance payment of $158,333 in two equal payments.

In connection with Mr.

appointment, the Company and Mr.

Harmon entered into an employment agreement (the “Harmon Employment Agreement”), pursuant

Harmon’s appointment,

the Company and Mr.

Harmon entered into an employment agreement (the “Harmon Employment Agreement”), pursuant to which Mr.

Harmon will serve as Chief Financial Officer of the Company and will be paid an annual base salary of $325,000.

Harmon is entitled to receive, subject to employment by the Company on the applicable date of bonus payout, an annual target discretionary

bonus of up to 30% of his annual base salary, payable at the discretion of the Compensation Committee of the Board.

Pursuant to the Harmon

Employment Agreement, Mr.

Harmon is also eligible to receive healthcare benefits as may be provided from time to time by the Company to

its employees generally, and to receive paid time off annually.

In addition, Mr.

is entitled to receive, subject to employment by the Company on the applicable date of bonus payout, an annual target discretionary bonus

of up to 30% of his annual base salary, payable at the discretion of the Compensation Committee of the Board.

Pursuant to the Harmon Employment

Agreement, Mr.

Harmon was granted a long-term equity incentive grant in the form of an option to purchase 1% of the total outstanding

shares of the Company’s common stock as of the Effective Date.

Such award vests in quarterly increments over a period of three years

from the Effective Date, subject to Mr.

Harmon is also eligible to receive healthcare benefits as may be provided from time to time by the Company to its employees

generally, and to receive paid time off annually.

Pursuant to the Harmon Employment Agreement, Mr.

Harmon was granted a long-term equity incentive grant in the form of an option to purchase 1% of the total outstanding shares of the Company’s

common stock as of the Effective Date.

Such award vests in quarterly increments over a period of three years from the Effective Date,

subject to Mr.

Harmon’s continued employment by the Company on the applicable vesting date.

option grant has an exercise price per share equal to $0.4305, which was the closing price of the Company’s common stock on the

Nasdaq Stock Market on the grant date.

Pursuant to the Harmon Employment

Agreement, Mr.

Harmon’s option grant has

an exercise price per share equal to $0.4305, which was the closing price of the Company’s common stock on the Nasdaq Stock Market

on the grant date.

Pursuant to the Harmon Employment Agreement, Mr.

Harmon agreed to be bound by certain non-compete and non-solicitation covenants contained therein.

Erin Henderson

Effective upon the closing

of our initial public offering, we entered into an employment agreement with Ms.

Henderson (the “Henderson Employment Agreement”),

pursuant to which she was employed as the Chief Business Officer of the Company.

The Henderson Employment Agreement provided for an annual

base salary, subject to annual increases in the discretion of our compensation committee, the Company, and an annual performance bonus.

Pursuant to the Henderson Employment Agreement, following the completion of our initial public offering, Ms.

Henderson’s base salary

was $325,000.

The annual performance bonus will be up to 40% of annual base salary (the “Target Annual Bonus”), with the actual

bonus being based upon the level of achievement of annual Company and individual performance objectives for such fiscal year, as determined

by our compensation committee.

Henderson resigned as Chief Business Officer of the Company, effective as of December 21, 2023.

On January 17, 2024, the Company entered

into a Separation Agreement and General Release with Ms.

Henderson, pursuant to which the Company agreed to engage The Aetos Group, a

management consulting company founded and managed by Ms.

Henderson (“Aetos”), to perform certain consulting services for the

On January 17, 2024, the Company entered into a Consulting Agreement with Aetos, pursuant to which Aetos will provide consulting

services to the Company until April 25, 2024, and receive a monthly fee of approximately $27,083.

Harmon resigned as Chief Financial Officer

of the Company effective as of June 8, 2024.

On June 10, 2024, the Company entered into a Release Agreement with Mr.

Harmon, which provides

for two months of severance payment.

Christian Brühlmann

In November 2011, Christian Brühlmann

entered into an employment agreement with Proteomedix (as amended, the “Brühlmann Employment Agreement”), pursuant to

In November 2011, Christian Brühlmann entered

into an employment agreement with Proteomedix (as amended, the “Brühlmann Employment Agreement”), pursuant to which Mr.

Brühlmann serves as Chief Financial Officer of Proteomedix and was paid a base salary of 233,100 Swiss francs (“CHF”)

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child allowance benefits.

Pursuant to the Brühlmann

Employment Agreement, Mr.

Pursuant to the Brühlmann Employment Agreement,

Brühlmann agreed to be bound by certain non-compete and non-solicitation covenants contained therein.

The Brühlmann Employment

Agreement may be terminated with notice in writing by either Proteomedix or Mr.

In the event of a change of control, either

party must give twelve months’ notice, but for a period starting six months prior to and two years after a change of control becomes

effective, Proteomedix must, upon request of Mr.

Brühlmann, release him from his working obligations (“Garden Leave”)

within 30 days after receipt of such request.

The Brühlmann Employment Agreement may be

terminated with notice in writing by either Proteomedix or Mr.

In the event of a change of control, either party must

give twelve months’ notice, but for a period starting six months prior to and two years after a change of control becomes effective,

Proteomedix must, upon request of Mr.

Brühlmann, release him from his working obligations (“Garden Leave”) within 30

days after receipt of such request.

During the Garden Leave, Mr.

Brühlmann may enter into consulting arrangements and accept

board positions, provided that Mr.

Brühlmann’ statutory and contractual confidentiality, non-competition and non-solicitation

obligations remain unchanged and in effect.

If the termination of the Brühlmann Employment Agreement is for any other reason than

a change of control, then either party must give five months’ notice.

Brühlmann may enter into consulting arrangements and accept board

positions, provided that Mr.

Brühlmann’ statutory and contractual confidentiality, non-competition and non-solicitation obligations

remain unchanged and in effect.

If the termination of the Brühlmann Employment Agreement is for any other reason than a change of

control, then either party must give five months’ notice.

On February 18, 2025, Christian Brühlmann

resigned from his position as Chief Strategy Officer of the Company, effective immediately.

Brühlmann will remain in his position

as Chief Business Officer of Proteomedix AG.

Ralph Schiess

In November 2011, Ralph Schiess

entered into an employment agreement with Proteomedix (as amended, the “Schiess Employment Agreement”), pursuant to which

Schiess serves as Chief Executive Officer of Proteomedix and was paid a base salary of CHF 233,100 in the fiscal year ended December

Schiess is also eligible to participate in the PMX Option Plan and to receive accident insurance, sick pay insurance, a

pension plan, and certain government-mandated child allowance benefits.

Pursuant to the Schiess Employment

Agreement, Dr.

In November 2011, Ralph Schiess entered into an

employment agreement with Proteomedix (as amended, the “Schiess Employment Agreement”), pursuant to which Dr.

Schiess serves

as Chief Executive Officer of Proteomedix and was paid a base salary of CHF 233,100 in the fiscal year ended December 31, 2023.

is also eligible to participate in the PMX Option Plan and to receive accident insurance, sick pay insurance, a pension plan, and certain

government-mandated child allowance benefits.

Schiess received a bonus of CHF 90,804 for 2023.

Pursuant to the Schiess Employment Agreement,

Schiess agreed to be bound by certain non-compete and non-solicitation covenants contained therein.

The Schiess Employment Agreement may be terminated with notice in writing

by either Proteomedix or Dr.

In the event of a change of control, either party must give twelve months’ notice, but for

a period starting six months prior to and two years after a change of control becomes effective, Proteomedix must, upon request of Dr.

The Schiess Employment Agreement may be terminated

with notice in writing by either Proteomedix or Dr.

In the event of a change of control, either party must give twelve months’

notice, but for a period starting six months prior to and two years after a change of control becomes effective, Proteomedix must, upon

request of Dr.

Schiess, must provide Garden Leave within 30 days after receipt of such request.

During the Garden Leave, Dr.

Schiess may enter into consulting

arrangements and accept board positions, provided that Dr.

Schiess’ statutory and contractual confidentiality, non-competition and

non-solicitation obligations remain unchanged and in effect.

If the termination of the Schiess Employment Agreement is for any other reason

than a change of control, then either party must give five months’ notice.

enter into consulting arrangements and accept board positions, provided that Dr.

Schiess’ statutory and contractual confidentiality,

non-competition and non-solicitation obligations remain unchanged and in effect.

If the termination of the Schiess Employment Agreement

is for any other reason than a change of control, then either party must give five months’ notice.

On February 24, 2025, Dr.

Schiess resigned from

his positions as the Interim Chief Executive Officer and Chief Science Officer of the Company, effective immediately, and from his position

as Chief Executive Officer of Proteomedix, effective May 31, 2025.

Karina Fedasz

On June 10, 2024, the Company appointed Karina

Fedasz as Interim Chief Financial Officer of the Company, effective immediately.

In connection with Ms.

Fedasz’s appointment

as Interim Chief Financial Officer, on June 10, 2024, the Company and Ms.

Fedasz entered into a consulting agreement (the “Fedasz

Consulting Agreement”), pursuant to which Ms.

Fedasz will serve as Interim Chief Financial Officer of the Company and will be paid

$15,000 per month for up to 80 hours of monthly service to the Company and will provide signatory services for $2,500 per month.

Consulting Agreement is for a term of one year, subject to early termination by either party upon thirty (30) days’ written notice.

On April 2, 2025, Ms.

Fedasz was appointed Interim

Chief Executive Officer of the Company.

No additional compensation was granted in connection with this appointment.

Potential Payments Upon Termination or Change-in-Control

See “Employment Agreements of Named Executive

Officers” above.

See “Employment Agreements of Named Executive Officers”

Outstanding Equity Awards at Fiscal Year-End

The following table summarizes

the number of shares of common stock underlying outstanding equity incentive plan awards for each named executive officer as of December

Each of the awards set forth in the table below was granted under our 2022 Equity Incentive Plan.

Option Awards

unexercisable

Neil Campbell

Joseph Hernandez

Erin Henderson

As of December 31, 2023, these incentive options, which were granted on October 4, 2023, vest and become exercisable as follows:

44,361 options vest quarterly beginning on January 4, 2024 through October 4, 2026.

All but 44,361 of these options were forfeited subsequent to December 31, 2023, in connection with Dr.

Campbell’s resignation .

These incentive options, which were granted on October 4, 2023, vest and become exercisable as follows:

14,787 options vest quarterly beginning on January 4, 2024 through October 4, 2026.

None of our named executive officers had any outstanding equity incentive

plan awards as of December 31, 2024.

Director Compensation

Prior to April 2022, our

directors have not received cash compensation for their service except for option grants.

However, in April 2022, after a review of non-employee

director compensation at comparable companies, the Board approved cash and equity compensation of directors, such that we will pay each

of our non-employee directors an annual cash retainer for service on the Board and for service on each committee on which the director

The Board has approved cash and equity compensation

of directors, such that we pay each of our non-employee directors an annual cash retainer for service on the Board and for service on

each committee on which the director is a member.

The chair of each committee receives an additional annual retainer for such service.

All retainers are payable in arrears

in four equal quarterly installments.

The retainers paid to non-employee directors for service on the Board and for service on each committee

of the Board on which the director is a member are as follows:

All retainers are payable in arrears in four equal quarterly installments.

The retainers paid to non-employee directors for service on

the Board and for service on each committee of the Board on which the director is a member are as follows:

Annual Board Service Retainer

9 unchanged sentences

Chair of the Nominating and Corporate Governance Committee

Additionally, each non-director

will receive an annual grant of nonqualified stock options to purchase 0.04% of the shares of Common Stock outstanding as of the date

of the Company’s annual meeting, such options vesting monthly over a one-year period and fully vesting upon the director’s

death or disability or upon a change of control of the Company.

Our Nominating Committee

will continue to review and make recommendations to the Board regarding compensation of directors, including equity-based plans.

reimburse our non-employee directors for reasonable travel expenses incurred in attending board and committee meetings.

Certain members of our Board have voluntarily

elected to waive payment of their annual cash retainers.

Additionally, each non-director will receive an

annual grant of restricted stock awards equal to 0.04% of the shares of Common Stock outstanding as of the date of the Company’s

annual meeting, such restricted stock vesting approximately one year from the grant dates and upon the director’s death or disability

or upon a change of control of the Company.

Our Compensation Committee will continue to review

and make recommendations to the Board regarding compensation of directors, including equity-based plans.

We will reimburse our non-employee

directors for reasonable travel expenses incurred in attending board and committee meetings.

Director Compensation Table

The following table sets

forth information concerning the compensation of our directors for the year ended December 31, 2023:

James Sapirstein

The following table sets forth information concerning

the compensation of our directors for the year ended December 31, 2024:

Timothy Ramdeen

James Sapirstein (9)

This figure represents the aggregate grant date fair value of stock-based awards granted in the fiscal year, computed in accordance with the provisions of FASB ASC 718.

Assumptions used in the calculation of these amounts are included in the notes to our consolidated financial statements included elsewhere in this Report.

Represents fees earned for serving as a member of the Board.

These directors were each granted 3,318 shares of restricted stock on September 26, 2024, which vest on August 31, 2025.

All such shares are unvested and remain outstanding as of December 31, 2024.

Represents fees earned for serving as a seller’s representative in connection with the PMX merger.

Represents fees earned by Mr.

Tarsh for serving as a member of the Board, Compensation Committee, and Nominating Governance Committee, as well as Chairman of the Audit Committee, totaling $77,500.

This figure also includes $30,000 of fees earned by Mr.

Tarsh for Special Committee compensation.

These directors were each granted 6,360 shares of restricted stock, which vest on May 31, 2024.

All such shares are unvested and remain outstanding as of December 31, 2023, except for the 6,360 shares originally granted to Mr.

Jeremic, which forfeited unvested on his resignation date.

Ramdeen, for serving as a member of the Board, Audit Committee, and Compensation Committee, as well as Chairman of the Nominating Governance Committee totaling $72,500.

Represents fees earned by Mr.

2 unchanged sentences

Sapirstein for his role as Lead Independent Director and non-executive Chairman of the Board.

Represents travel expenses incurred by Mr.

Sapirstein and reimbursed by the Company.

(6) Represents pro-rated fees earned by Mr.

Jeremic for 2023, through his

resignation on September 2, 2023.

Such fees were earned for serving as a member of the Board, Compensation Committee, and Nominating Governance

Singh was granted 3,318 shares of restricted stock, which vest on August 31, 2025.

All such shares are unvested and remain outstanding as of December 31, 2024.

Sing was also granted 78 shares on February 14, 2024 when he joined the Board, which vested in full on June 30, 2024.

Represents fees earned by Mr.

Ramdeen, for serving as a member of the Board, Audit Committee, and Compensation Committee, as well as Chairman of the Nominating Governance Committee.

Ramdeen was granted 2,386 stock options during the year ended

December 31, 2023, when he joined the Board January 2023.

The options vested monthly through May 13, 2023.

31, 2023, these options are fully vested and outstanding.

Security Ownership of Certain Beneficial Owners and Management

and Related Stockholder Matters.

The following table sets

forth certain information concerning the ownership of our common stock, with respect to:

(i) each person, or group of affiliated persons,

known to us to be the beneficial owner of more than five percent of our common stock;

(ii) each of our directors;

(iii) each of our named

executive officers;

and (iv) all of our current directors and executive officers as a group.

Applicable percentage ownership is based on 22,186,746

shares of common stock outstanding as of April 5, 2024.

We have determined beneficial

ownership in accordance with the rules of the SEC.

These rules generally attribute beneficial ownership of securities to persons who possess

sole or shared voting or investment power with respect to such securities.

In addition, pursuant to such rules, we deemed outstanding

shares of common stock subject to options or warrants held by that person that are currently exercisable or exercisable within 60 days

of April 5, 2024.

We did not deem such shares outstanding, however, for the purpose of computing the percentage ownership of any other

Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the beneficial owners named

in the table below have sole voting and investment power with respect to all shares of our common stock that they beneficially own, subject

to applicable community property laws.

Shares of Common

Name and Address of Beneficial Owner (1)

Executive Officers and Directors

Ralph Schiess

269,749 (2)(11)

Christian Brühlmann

236,029 (4)(11)

Timothy Ramdeen

James Sapirstein

All directors and named executive officers as a group (8 persons)

5% Stockholders

Joseph Hernandez

2,650,351 (8)

Altos Venture AG

1,103,403 (9)

American Financial Group, Inc.

1,440,927 (10)

* Represents beneficial ownership

of less than 1%.

Unless otherwise noted, the business address of each of the following entities or individuals is c/o Onconetix, Inc., 201 E.

Fifth Street, Suite 1900, Cincinnati, Ohio 45202.

Consists of 269,749 shares of common stock.

Consists of 29,574 shares of common stock underlying options that are currently exercisable within 60 days of April 5, 2024.

Consists of 236,029 shares of common stock.

Consists of 4,073 shares of common stock underlying options that are currently exercisable within 60 days of April 5, 2024.

Consists of 2,386 shares of common stock underlying options that are currently exercisable within 60 days of April 5, 2024.

Consists of 30,467 shares of common stock underlying options that are currently exercisable within 60 days of April 5, 2024.

Based on a Schedule 13G filed with the SEC on February 14, 2023.

The principal business address for Mr.

Hernandez was c/o Onconetix, Inc., 201 E.

Fifth Street, Suite 1900, Cincinnati, Ohio 45202.

Based on a Schedule 13D filed with the SEC on December 28, 2023.

principal business address for Altos Venture AG is Obertorweg 64, CH-4123 Allschwil/Switzerland.

Based on a Schedule 13G/A filed with the SEC on January 26, 2024.

principal business address for American Financial Group, Inc.

is 301 East Fourth Street, Cincinnati, Ohio 45202.

(i) any options granted to the individual pursuant to the

PMX Option Plan, which will be converted into Onconetix securities after the Conversion;

and (ii) any shares of Series B Preferred Stock

held by the individual, which shares are not convertible into shares of common stock unless and until Stockholder Approval is obtained.

Securities Authorized for Issuance under Equity

Compensation Plans

The following table provides

information as of December 31, 2023, regarding our common stock that may be issued under the Company’s 2019 Equity Incentive Plan

(the “2019 Plan”) and the Company’s 2022 Equity Incentive Plan (the “2022 Plan”).

Tarsh for serving as a member of the Board, Compensation Committee, and Nominating Governance Committee, as well as Chairman of the Audit Committee, totaling $82,500.

As of March 28, 2025, James Sapirstein resigned as Executive Chairman and a member of the Board.

Securities Authorized for Issuance under

Equity Compensation Plans

The following table provides information as of

December 31, 2024, regarding our common stock that may be issued under the Company’s 2019 Equity Incentive Plan (the “2019

Plan”) and the Company’s 2022 Equity Incentive Plan (the “2022 Plan”).

Plan category:

6 unchanged sentences

2022 Plan (3)

The 2019 Plan permits grants of equity awards to employees, directors,

consultants, and other independent contractors.

Our board of directors and stockholders have approved a total reserve of 1,400,000 shares

for issuance under the 2019 Plan.

Once the 2022 Plan became effective, no further grants were made under the 2019 Plan and all shares that remained available for the issuance of awards under our 2019 Plan as of immediately prior to the time our 2022 Plan became effective were rolled over into the 2022 Plan.

The 2019 Plan permits grants of equity awards to employees, directors, consultants, and other independent contractors.

Our board of directors and stockholders have approved a total reserve of 35,000 shares for issuance under the 2019 Plan.

The 2022 Plan permits grants of equity awards to employees, directors, consultants, and other independent contractors.

Our board of directors and stockholders have approved a total reserve of 1,450,000 shares for issuance under the 2022 Plan, of which 719,660 are remaining.

The following table provides

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2022 Equity Incentive Plan

Our board of directors adopted,

and our stockholders approved, our 2022 Plan effective upon the completion of our initial public offering.

Our 2022 Plan is a successor

to and continuation of our 2019 Plan.

Our board of directors adopted, and our stockholders

approved, our 2022 Plan effective upon the completion of our initial public offering.

Our 2022 Plan is a successor to and continuation

of our 2019 Plan.

Our 2022 Plan became effective on the date of the completion of our initial public offering.

the 2022 Plan became effective, no further grants will be made under the 2019 Plan.

Our 2022 Plan

provides for the grant of incentive stock options, or ISOs, within the meaning of Section 422 of the Internal Revenue Code, or the Code,

to employees, including employees of any parent or subsidiary, and for the grant of nonstatutory stock options, or NSOs, stock appreciation

rights, restricted stock awards, restricted stock unit awards, performance awards and other forms of awards to employees, directors and

consultants, including employees and consultants of our affiliates.

Once the 2022 Plan became

effective, no further grants will be made under the 2019 Plan.

Our 2022 Plan provides for the

grant of incentive stock options, or ISOs, within the meaning of Section 422 of the Internal Revenue Code, or the Code, to employees,

including employees of any parent or subsidiary, and for the grant of nonstatutory stock options, or NSOs, stock appreciation rights,

restricted stock awards, restricted stock unit awards, performance awards and other forms of awards to employees, directors and consultants,

including employees and consultants of our affiliates.

Authorized Shares.

the maximum number of shares of our common stock that may be issued under our 2022 Plan was 1,600,000 shares of our common stock, which

is the sum of (i) 200,000 new shares, plus (ii) an additional number of shares not to exceed 1,400,000 (calculated after giving effect

to the Pre-IPO Stock Split), consisting of (A) shares that remain available for the issuance of awards under our 2019 Plan as of immediately

prior to the time our 2022 Plan becomes effective and (B) shares of our common stock subject to outstanding stock options or other stock

awards granted under our 2019 Plan that, on or after the 2022 Plan becomes effective, terminate or expire prior to exercise or settlement;

are not issued because the award is settled in cash;

Initially, the maximum

number of shares of our common stock that may be issued under our 2022 Plan was 40,000 shares of our common stock, which is the sum of

(i) 5,000 new shares, plus (ii) an additional number of shares not to exceed 35,000 (calculated after giving effect to the Pre-IPO Stock

Split), consisting of (A) shares that remain available for the issuance of awards under our 2019 Plan as of immediately prior to the time

our 2022 Plan becomes effective and (B) shares of our common stock subject to outstanding stock options or other stock awards granted

under our 2019 Plan that, on or after the 2022 Plan becomes effective, terminate or expire prior to exercise or settlement;

are not issued

because the award is settled in cash;

are forfeited because of the failure to vest;

or are reacquired or withheld (or not

issued) to satisfy a tax withholding obligation or the purchase or exercise price, if any, as such shares become available from time to

On August 22, 2022, at the

Company’s 2022 annual meeting of stockholders, the Company’s stockholders approved an additional 1,000,000 shares of common

stock that may be issued under the 2022 Plan.

On May 31, 2023, at the Company’s 2022 annual meeting of stockholders, the Company’s

stockholders approved an additional 550,000 shares of common stock that may be issued under the 2022 Plan.

The number of shares of common

stock available for issuance under our 2022 Plan will be reduced by:

one share for each share of common stock issued pursuant to a stock

option or stock appreciation right with respect to which the exercise or strike price is at least 100% of the Fair Market Value of the

Common Stock subject to the stock option or appreciation right on the grant date;

and (ii) 1.20 shares for each share of common stock

issued pursuant to any restricted stock unit or other “full value award.” The maximum number of shares of our common stock

that may be issued on the exercise of ISOs under our 2022 Plan is equal to the number of shares reserved under the 2022 Plan at any time.

Shares subject to stock awards

granted under our 2022 Plan that expire or terminate without being exercised in full or that are paid out in cash rather than in shares

do not reduce the number of shares available for issuance under our 2022 Plan.

Shares withheld under a stock award to satisfy the exercise,

strike, or purchase price of a stock award or to satisfy a tax withholding obligation do not reduce the number of shares available for

issuance under our 2022 Plan.

If any shares of our common stock issued pursuant to a stock award are forfeited back to or repurchased

or reacquired by us (i) because of a failure to meet a contingency or condition required for the vesting of such shares, (ii) to satisfy

the exercise, strike or purchase price of an award or (iii) to satisfy a tax withholding obligation in connection with an award, the shares

that are forfeited or repurchased or reacquired will revert to and again become available for issuance under the 2022 Plan.

previously issued which are reacquired in satisfaction of tax withholding obligations or as consideration for the exercise or purchase

price of a stock award will again become available for issuance under the 2022 Plan.

The number of shares available for issuance under

our 2022 Plan will increase by 1.20 shares for each share subject to restricted stock units or other full value awards (not including

stock options or stock appreciation rights) which are forfeited or reacquired for the reasons described in the preceding two sentences.

or are reacquired or withheld (or not issued) to satisfy

a tax withholding obligation or the purchase or exercise price, if any, as such shares become available from time to time.

On August 22, 2022, at the Company’s 2022

annual meeting of stockholders, the Company’s stockholders approved an additional 25,000 shares of common stock that may be issued

under the 2022 Plan.

On May 31, 2023, at the Company’s 2022 annual meeting of stockholders, the Company’s stockholders approved

an additional 13,750 shares of common stock that may be issued under the 2022 Plan.

On September 5, 2024, at the Company’s 2024

annual meeting of stockholders, the Company’s stockholders approved an additional 1,371,250 shares of common stock that may be issued

under the 2022 Plan.

The number of shares of common stock available

for issuance under our 2022 Plan will be reduced by:

one share for each share of common stock issued pursuant to a stock option or stock

appreciation right with respect to which the exercise or strike price is at least 100% of the Fair Market Value of the Common Stock subject

to the stock option or appreciation right on the grant date;

and (ii) 1.20 shares for each share of common stock issued pursuant to any

restricted stock unit or other “full value award.” The maximum number of shares of our common stock that may be issued on

the exercise of ISOs under our 2022 Plan is equal to the number of shares reserved under the 2022 Plan at any time.

Shares subject to stock awards granted under our

2022 Plan that expire or terminate without being exercised in full or that are paid out in cash rather than in shares do not reduce the

number of shares available for issuance under our 2022 Plan.

Shares withheld under a stock award to satisfy the exercise, strike, or purchase

price of a stock award or to satisfy a tax withholding obligation do not reduce the number of shares available for issuance under our

If any shares of our common stock issued pursuant to a stock award are forfeited back to or repurchased or reacquired by us

(i) because of a failure to meet a contingency or condition required for the vesting of such shares, (ii) to satisfy the exercise, strike

or purchase price of an award or (iii) to satisfy a tax withholding obligation in connection with an award, the shares that are forfeited

or repurchased or reacquired will revert to and again become available for issuance under the 2022 Plan.

Any shares previously issued

which are reacquired in satisfaction of tax withholding obligations or as consideration for the exercise or purchase price of a stock

award will again become available for issuance under the 2022 Plan.

The number of shares available for issuance under our 2022 Plan will

increase by 1.20 shares for each share subject to restricted stock units or other full value awards (not including stock options or stock

appreciation rights) which are forfeited or reacquired for the reasons described in the preceding two sentences.

Plan Administration.

Board of Directors has assigned the authority to administer the 2022 Plan to our Compensation Committee, but may, at any time, re-vest

in itself some or all of the power delegated to our Compensation Committee.

The Compensation Committee may delegate to one or more of

our officers the authority to (i) designate employees (other than officers) to receive specified stock awards and (ii) determine the number

of shares subject to such stock awards.

Under our 2022 Plan, our Compensation Committee has the authority to determine award recipients,

grant dates, the numbers and types of stock awards to be granted, the applicable fair market value, and the provisions of each stock award,

including the period of exercisability and the vesting schedule applicable to a stock award.

Our Board of Directors

has assigned the authority to administer the 2022 Plan to our Compensation Committee, but may, at any time, re-vest in itself some or

all of the power delegated to our Compensation Committee.

The Compensation Committee may delegate to one or more of our officers the authority

to (i) designate employees (other than officers) to receive specified stock awards and (ii) determine the number of shares subject to

such stock awards.

Under our 2022 Plan, our Compensation Committee has the authority to determine award recipients, grant dates, the numbers

and types of stock awards to be granted, the applicable fair market value, and the provisions of each stock award, including the period

of exercisability and the vesting schedule applicable to a stock award.

Stock Options.

and NSOs are granted under stock option agreements in a form approved by the Compensation Committee.

The Compensation Committee determines

the exercise price for stock options, within the terms and conditions of the 2022 Plan, provided that the exercise price of a stock option

generally cannot be less than 100% of the fair market value of our common stock on the date of grant.

Options granted under the 2022 Plan

vest at the rate specified in the stock option agreement as determined by the Compensation Committee.

The Compensation Committee

determines the term of stock options granted under the 2022 Plan, up to a maximum of 10 years.

Unless the terms of an option holder’s

stock option agreement, or other written agreement between us and the recipient approved by the Compensation Committee, provide otherwise,

if an option holder’s service relationship with us or any of our affiliates ceases for any reason other than disability, death or

cause, the option holder may generally exercise any vested options for a period of three months following the cessation of service.

period may be extended in the event that exercise of the option is prohibited by applicable securities laws.

If an option holder’s

service relationship with us or any of our affiliates ceases due to death, or an option holder dies within a certain period following

cessation of service, the option holder or a beneficiary may generally exercise any vested options for a period of 18 months following

the date of death.

If an option holder’s service relationship with us or any of our affiliates ceases due to disability, the option

holder may generally exercise any vested options for a period of 12 months following the cessation of service.

In the event of a termination

for cause, options generally terminate upon the termination date.

In no event may an option be exercised beyond the expiration of its

Acceptable consideration

for the purchase of common stock issued upon the exercise of a stock option will be determined by the Compensation Committee and may include

(i) cash, check, bank draft or money order, (ii) a broker-assisted cashless exercise, (iii) the tender of shares of our common stock previously

owned by the option holder, (iv) a net exercise of the option if it is an NSO or (v) other legal consideration approved by the Board of

Unless the Compensation Committee

provides otherwise, options or stock appreciation rights generally are not transferable except by will or the laws of descent and distribution.

Subject to approval of the Compensation Committee or a duly authorized officer, an option may be transferred pursuant to a domestic relations

order, official marital settlement agreement or other divorce or separation instrument.

ISOs and NSOs are granted

under stock option agreements in a form approved by the Compensation Committee.

The Compensation Committee determines the exercise price

for stock options, within the terms and conditions of the 2022 Plan, provided that the exercise price of a stock option generally cannot

be less than 100% of the fair market value of our common stock on the date of grant.

Options granted under the 2022 Plan vest at the rate

specified in the stock option agreement as determined by the Compensation Committee.

The Compensation Committee determines the term

of stock options granted under the 2022 Plan, up to a maximum of 10 years.

Unless the terms of an option holder’s stock option agreement,

or other written agreement between us and the recipient approved by the Compensation Committee, provide otherwise, if an option holder’s

service relationship with us or any of our affiliates ceases for any reason other than disability, death or cause, the option holder may

generally exercise any vested options for a period of three months following the cessation of service.

This period may be extended in

the event that exercise of the option is prohibited by applicable securities laws.

If an option holder’s service relationship with

us or any of our affiliates ceases due to death, or an option holder dies within a certain period following cessation of service, the

option holder or a beneficiary may generally exercise any vested options for a period of 18 months following the date of death.

option holder’s service relationship with us or any of our affiliates ceases due to disability, the option holder may generally

exercise any vested options for a period of 12 months following the cessation of service.

In the event of a termination for cause, options

generally terminate upon the termination date.

In no event may an option be exercised beyond the expiration of its term.

Acceptable consideration for the purchase of common

stock issued upon the exercise of a stock option will be determined by the Compensation Committee and may include (i) cash, check, bank

draft or money order, (ii) a broker-assisted cashless exercise, (iii) the tender of shares of our common stock previously owned by the

option holder, (iv) a net exercise of the option if it is an NSO or (v) other legal consideration approved by the Board of Directors.

Unless the Compensation Committee provides otherwise,

options or stock appreciation rights generally are not transferable except by will or the laws of descent and distribution.

approval of the Compensation Committee or a duly authorized officer, an option may be transferred pursuant to a domestic relations order,

official marital settlement agreement or other divorce or separation instrument.

Tax Limitations on ISOs.

The aggregate fair market value, determined at the time of grant, of our common stock with respect to ISOs that are exercisable for

the first time by an award holder during any calendar year under all of our stock plans may not exceed $100,000.

Options or portions thereof

that exceed such limit will generally be treated as NSOs.

No ISO may be granted to any person who, at the time of the grant, owns or is

deemed to own stock possessing more than 10% of our total combined voting power or that of any of our parent or subsidiary corporations

unless (i) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant

and (ii) the term of the ISO does not exceed five years from the date of grant.

Restricted Stock Unit

Restricted stock unit awards are granted under restricted stock unit award agreements in a form approved by the Compensation

Restricted stock unit awards may be granted in consideration for any form of legal consideration that may be acceptable to

our board of directors and permissible under applicable law.

A restricted stock unit award may be settled by cash, delivery of stock,

a combination of cash and stock as deemed appropriate by the Compensation Committee or in any other form of consideration set forth in

the restricted stock unit award agreement.

Additionally, dividend equivalents may be credited in respect of shares covered by a restricted

stock unit award.

Except as otherwise provided in the applicable award agreement, or other written agreement between us and the recipient

approved by the Compensation Committee, restricted stock unit awards that have not vested will be forfeited once the participant’s

continuous service ends for any reason.

The aggregate

fair market value, determined at the time of grant, of our common stock with respect to ISOs that are exercisable for the first time by

an award holder during any calendar year under all of our stock plans may not exceed $100,000.

Options or portions thereof that exceed

such limit will generally be treated as NSOs.

No ISO may be granted to any person who, at the time of the grant, owns or is deemed to

own stock possessing more than 10% of our total combined voting power or that of any of our parent or subsidiary corporations unless (i)

the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant and (ii) the

term of the ISO does not exceed five years from the date of grant.

Restricted Stock Unit Awards.

stock unit awards are granted under restricted stock unit award agreements in a form approved by the Compensation Committee.

stock unit awards may be granted in consideration for any form of legal consideration that may be acceptable to our board of directors

and permissible under applicable law.

A restricted stock unit award may be settled by cash, delivery of stock, a combination of cash and

stock as deemed appropriate by the Compensation Committee or in any other form of consideration set forth in the restricted stock unit

award agreement.

Additionally, dividend equivalents may be credited in respect of shares covered by a restricted stock unit award.

as otherwise provided in the applicable award agreement, or other written agreement between us and the recipient approved by the Compensation

Committee, restricted stock unit awards that have not vested will be forfeited once the participant’s continuous service ends for

Restricted Stock Awards.

Restricted stock awards are granted under restricted stock award agreements in a form approved by the Compensation Committee.

stock award may be awarded in consideration for cash, check, bank draft or money order, past or future services to us or any other form

of legal consideration that may be acceptable to our board of directors and permissible under applicable law.

The Compensation Committee

determines the terms and conditions of restricted stock awards, including vesting and forfeiture terms.

If a participant’s service

relationship with us ends for any reason, we may receive any or all of the shares of common stock held by the participant that have not

vested as of the date the participant terminates service with us through a forfeiture condition or a repurchase right.

Restricted stock

awards are granted under restricted stock award agreements in a form approved by the Compensation Committee.

A restricted stock award

may be awarded in consideration for cash, check, bank draft or money order, past or future services to us or any other form of legal consideration

that may be acceptable to our board of directors and permissible under applicable law.

The Compensation Committee determines the terms

and conditions of restricted stock awards, including vesting and forfeiture terms.

If a participant’s service relationship with

us ends for any reason, we may receive any or all of the shares of common stock held by the participant that have not vested as of the

date the participant terminates service with us through a forfeiture condition or a repurchase right.

Stock Appreciation Rights.

Stock appreciation rights are granted under stock appreciation right agreements in a form approved by the Compensation Committee.

The Compensation Committee determines the strike price for a stock appreciation right, which generally cannot be less than 100% of the

fair market value of our common stock on the date of grant.

A stock appreciation right granted under the 2022 Plan vests at the rate specified

in the stock appreciation right agreement as determined by the Compensation Committee.

Stock appreciation rights may be settled in cash

or shares of common stock or in any other form of payment as determined by the Board and specified in the stock appreciation right agreement.

Stock appreciation

rights are granted under stock appreciation right agreements in a form approved by the Compensation Committee.

The Compensation Committee

determines the term of stock appreciation rights granted under the 2022 Plan, up to a maximum of 10 years.

If a participant’s service

relationship with us or any of our affiliates ceases for any reason other than cause, disability or death, the participant may generally

exercise any vested stock appreciation right for a period of three months following the cessation of service.

This period may be further

extended in the event that exercise of the stock appreciation right following such a termination of service is prohibited by applicable

securities laws.

If a participant’s service relationship with us, or any of our affiliates, ceases due to disability or death, or

a participant dies within a certain period following cessation of service, the participant or a beneficiary may generally exercise any

vested stock appreciation right for a period of 12 months in the event of disability and 18 months in the event of death.

of a termination for cause, stock appreciation rights generally terminate immediately upon the occurrence of the event giving rise to

the termination of the individual for cause.

determines the strike price for a stock appreciation right, which generally cannot be less than 100% of the fair market value of our common

stock on the date of grant.

A stock appreciation right granted under the 2022 Plan vests at the rate specified in the stock appreciation

right agreement as determined by the Compensation Committee.

Stock appreciation rights may be settled in cash or shares of common stock

or in any other form of payment as determined by the Board and specified in the stock appreciation right agreement.

The Compensation Committee determines the term

of stock appreciation rights granted under the 2022 Plan, up to a maximum of 10 years.

If a participant’s service relationship with

us or any of our affiliates ceases for any reason other than cause, disability or death, the participant may generally exercise any vested

stock appreciation right for a period of three months following the cessation of service.

This period may be further extended in the event

that exercise of the stock appreciation right following such a termination of service is prohibited by applicable securities laws.

a participant’s service relationship with us, or any of our affiliates, ceases due to disability or death, or a participant dies

within a certain period following cessation of service, the participant or a beneficiary may generally exercise any vested stock appreciation

right for a period of 12 months in the event of disability and 18 months in the event of death.

In the event of a termination for cause,

stock appreciation rights generally terminate immediately upon the occurrence of the event giving rise to the termination of the individual

In no event may a stock appreciation right be exercised beyond the expiration of its term.

Performance Awards.

2022 Plan permits the grant of performance awards that may be settled in stock, cash, or other property.

Performance awards may be structured

so that the stock or cash will be issued or paid only following the achievement of certain pre-established performance goals during a

designated performance period.

Performance awards that are settled in cash or other property are not required to be valued in whole or

in part by reference to, or otherwise based on, the common stock.

The performance goals may

be based on any measure of performance selected by the board of directors or the Compensation Committee.

The performance goals may be

based on company-wide performance or performance of one or more business units, divisions, affiliates, or business segments, and may be

either absolute or relative to the performance of one or more comparable companies or the performance of one or more relevant indices.

Unless specified otherwise by the board of directors at the time the performance award is granted, the board or Compensation Committee

will appropriately make adjustments in the method of calculating the attainment of performance goals as follows:

(i) to exclude restructuring

and/or other nonrecurring charges;

The 2022 Plan permits

the grant of performance awards that may be settled in stock, cash, or other property.

Performance awards may be structured so that the

stock or cash will be issued or paid only following the achievement of certain pre-established performance goals during a designated performance

Performance awards that are settled in cash or other property are not required to be valued in whole or in part by reference to,

or otherwise based on, the common stock.

The performance goals may be based on any measure

of performance selected by the board of directors or the Compensation Committee.

The performance goals may be based on company-wide performance

or performance of one or more business units, divisions, affiliates, or business segments, and may be either absolute or relative to the

performance of one or more comparable companies or the performance of one or more relevant indices.

Unless specified otherwise by the

board of directors at the time the performance award is granted, the board or Compensation Committee will appropriately make adjustments

in the method of calculating the attainment of performance goals as follows:

(i) to exclude restructuring and/or other nonrecurring charges;

(ii) to exclude exchange rate effects;

(iii) to exclude the effects of changes to generally accepted

accounting principles;

(iv) to exclude the effects of any statutory adjustments to corporate tax rates;

(v) to exclude the effects of

items that are “unusual” in nature or occur “infrequently” as determined under generally accepted accounting principles;

(vi) to exclude the dilutive effects of acquisitions or joint ventures;

(vii) to assume that any portion of our business which is divested

achieved performance objectives at targeted levels during the balance of a performance period following such divestiture;

(viii) to exclude

the effect of any change in the outstanding shares of our common stock by reason of any stock dividend or split, stock repurchase, reorganization,

recapitalization, merger, consolidation, spin-off, combination or exchange of shares or other similar corporate change or any distributions

to common stockholders other than regular cash dividends;

(ix) to exclude the effects of stock based compensation and the award of bonuses

under our bonus plans;

(x) to exclude costs incurred in connection with potential acquisitions or divestitures that are required to be

expensed under generally accepted accounting principles;

(xi) to exclude the goodwill and intangible asset impairment charges that are

required to be recorded under generally accepted accounting principles;

and (xi) to exclude the effects of the timing of acceptance for

review and/or approval of submissions to the U.S.

(iii) to exclude the effects of changes to generally accepted accounting principles;

(iv) to exclude

the effects of any statutory adjustments to corporate tax rates;

(v) to exclude the effects of items that are “unusual” in

nature or occur “infrequently” as determined under generally accepted accounting principles;

(vi) to exclude the dilutive

effects of acquisitions or joint ventures;

(vii) to assume that any portion of our business which is divested achieved performance objectives

at targeted levels during the balance of a performance period following such divestiture;

(viii) to exclude the effect of any change in

the outstanding shares of our common stock by reason of any stock dividend or split, stock repurchase, reorganization, recapitalization,

merger, consolidation, spin-off, combination or exchange of shares or other similar corporate change or any distributions to common stockholders

other than regular cash dividends;

(ix) to exclude the effects of stock based compensation and the award of bonuses under our bonus plans;

(x) to exclude costs incurred in connection with potential acquisitions or divestitures that are required to be expensed under generally

accepted accounting principles;

(xi) to exclude the goodwill and intangible asset impairment charges that are required to be recorded

under generally accepted accounting principles;

and (xi) to exclude the effects of the timing of acceptance for review and/or approval

of submissions to the U.S.

Food and Drug Administration or any other regulatory body.

Other Stock Awards.

Compensation Committee may grant other awards based in whole or in part by reference to our common stock.

The Compensation Committee will

set the number of shares under the stock award (or cash equivalent) and all other terms and conditions of such awards.

Non-Employee Director

Compensation Limit.

The aggregate value of all compensation granted or paid to any non-employee director with respect to any calendar

year, including awards granted and cash fees paid by us to such non-employee director, will not exceed $150,000 in total value;

that such amount will increase to $200,000 for the first year for newly appointed or elected non-employee directors.

The Compensation Committee

may grant other awards based in whole or in part by reference to our common stock.

The Compensation Committee will set the number of shares

under the stock award (or cash equivalent) and all other terms and conditions of such awards.

Non-Employee Director Compensation Limit.

aggregate value of all compensation granted or paid to any non-employee director with respect to any calendar year, including awards granted

and cash fees paid by us to such non-employee director, will not exceed $150,000 in total value;

provided that such amount will increase

to $200,000 for the first year for newly appointed or elected non-employee directors.

Changes to Capital Structure.

In the event there is a specified type of change in our capital structure, such as a stock split, reverse stock split or recapitalization,

appropriate adjustments will be made to (i) the class and maximum number of shares reserved for issuance under the 2022 Plan, (ii) the

class and maximum number of shares by which the share reserve may increase automatically each year, (iii) the class and maximum number

of shares that may be issued on the exercise of ISOs and (iv) the class and number of shares and exercise price, strike price or purchase

price, if applicable, of all outstanding stock awards.

there is a specified type of change in our capital structure, such as a stock split, reverse stock split or recapitalization, appropriate

adjustments will be made to (i) the class and maximum number of shares reserved for issuance under the 2022 Plan, (ii) the class and maximum

number of shares by which the share reserve may increase automatically each year, (iii) the class and maximum number of shares that may

be issued on the exercise of ISOs and (iv) the class and number of shares and exercise price, strike price or purchase price, if applicable,

of all outstanding stock awards.

Corporate Transactions.

The following applies to stock awards under the 2022 Plan in the event of a corporate transaction (as defined in the 2022 Plan), unless

otherwise provided in a participant’s stock award agreement or other written agreement with us or one of our affiliates or unless

otherwise expressly provided by the Board of Directors or Compensation Committee at the time of grant.

In the event of a corporate

transaction, any stock awards outstanding under the 2022 Plan may be assumed, continued, or substituted for by any surviving or acquiring

corporation (or its parent company), and any reacquisition or repurchase rights held by us with respect to the stock award may be assigned

to the successor (or its parent company).

If the surviving or acquiring corporation (or its parent company) does not assume, continue

or substitute for such stock awards, then (i) with respect to any such stock awards that are held by participants whose continuous service

has not terminated prior to the effective time of the corporate transaction, or current participants, the vesting (and exercisability,

if applicable) of such stock awards will be accelerated in full to a date prior to the effective time of the corporate transaction (contingent

upon the effectiveness of the corporate transaction), and such stock awards will terminate if not exercised (if applicable) at or prior

to the effective time of the corporate transaction, and any reacquisition or repurchase rights held by us with respect to such stock awards

will lapse (contingent upon the effectiveness of the corporate transaction), and (ii) any such stock awards that are held by persons other

The following applies

to stock awards under the 2022 Plan in the event of a corporate transaction (as defined in the 2022 Plan), unless otherwise provided in

a participant’s stock award agreement or other written agreement with us or one of our affiliates or unless otherwise expressly

provided by the Board or Compensation Committee at the time of grant.

In the event of a corporate transaction, any stock

awards outstanding under the 2022 Plan may be assumed, continued, or substituted for by any surviving or acquiring corporation (or its

parent company), and any reacquisition or repurchase rights held by us with respect to the stock award may be assigned to the successor

(or its parent company).

If the surviving or acquiring corporation (or its parent company) does not assume, continue or substitute for

such stock awards, then (i) with respect to any such stock awards that are held by participants whose continuous service has not terminated

prior to the effective time of the corporate transaction, or current participants, the vesting (and exercisability, if applicable) of

such stock awards will be accelerated in full to a date prior to the effective time of the corporate transaction (contingent upon the

effectiveness of the corporate transaction), and such stock awards will terminate if not exercised (if applicable) at or prior to the

effective time of the corporate transaction, and any reacquisition or repurchase rights held by us with respect to such stock awards will

lapse (contingent upon the effectiveness of the corporate transaction), and (ii) any such stock awards that are held by persons other

than current participants will terminate if not exercised (if applicable) prior to the effective time of the corporate transaction, except

1 unchanged sentence

notwithstanding the corporate transaction.

In the event a stock award

will terminate if not exercised prior to the effective time of a corporate transaction, the board of directors may provide, in its sole

discretion, that the holder of such stock award may not exercise such stock award but instead will receive a payment equal in value to

the excess (if any) of (i) the per share amount payable to holders of common stock in connection with the corporate transaction over (ii)

any per share exercise price payable by such holder, if applicable.

In addition, any escrow, holdback, earn out or similar provisions

in the definitive agreement for the corporate transaction may apply to such payment to the same extent and in the same manner as such

provisions apply to the holders of common stock.

In the event a stock award will terminate if not

exercised prior to the effective time of a corporate transaction, the board of directors may provide, in its sole discretion, that the

holder of such stock award may not exercise such stock award but instead will receive a payment equal in value to the excess (if any)

of (i) the per share amount payable to holders of common stock in connection with the corporate transaction over (ii) any per share exercise

price payable by such holder, if applicable.

In addition, any escrow, holdback, earn out or similar provisions in the definitive agreement

for the corporate transaction may apply to such payment to the same extent and in the same manner as such provisions apply to the holders

of common stock.

Plan Amendment or Termination.

Our board of directors has the authority to amend, suspend or terminate our 2022 Plan, provided that such action does not materially

impair the existing rights of any participant without such participant’s written consent.

Certain material amendments also require

the approval of our stockholders.

No ISOs may be granted after the tenth anniversary of the date our board of directors adopts our 2022

No stock awards may be granted under our 2022 Plan while it is suspended or after it is terminated.

of directors has the authority to amend, suspend or terminate our 2022 Plan, provided that such action does not materially impair the

existing rights of any participant without such participant’s written consent.

Certain material amendments also require the approval

of our stockholders.

No ISOs may be granted after the tenth anniversary of the date our board of directors adopts our 2022 Plan.

awards may be granted under our 2022 Plan while it is suspended or after it is terminated.

2019 Equity Incentive Plan

Our board of directors adopted,

and our stockholders approved our 2019 Equity Incentive Plan (the “2019 Plan”) in July 2019 for grants of awards to employees,

directors, officers, and consultants of us or any of our subsidiaries.

Once the 2022 Plan became effective, no further grants will be

made under the 2019 Plan.

However, the 2019 Plan will continue to govern the terms and conditions of the outstanding awards previously

granted under the 2019 Plan.

Our 2019 Plan

provides for the grant of stock awards (collectively, “Stock Awards”) to employees, directors, officers and consultants of

us or any of our subsidiaries, consisting of (i) incentive stock options, (“ISOs”), within the meaning of Section 422 of the

Internal Revenue Code (the “Code”);

Our board of directors adopted, and our stockholders

approved our 2019 Equity Incentive Plan (the “2019 Plan”) in July 2019 for grants of awards to employees, directors, officers,

and consultants of us or any of our subsidiaries.

Once the 2022 Plan became effective, no further grants will be made under the 2019 Plan.

However, the 2019 Plan will continue to govern the terms and conditions of the outstanding awards previously granted under the 2019 Plan.

Our 2019 Plan provides for the

grant of stock awards (collectively, “Stock Awards”) to employees, directors, officers and consultants of us or any of our

subsidiaries, consisting of (i) incentive stock options, (“ISOs”), within the meaning of Section 422 of the Internal Revenue

Code (the “Code”);

(ii) nonstatutory stock options (“NSOs”);

(iii) stock appreciation rights;

(iv) restricted stock awards;

(iv) restricted

stock awards;

(v) restricted stock unit awards, and (vi) other forms of awards.

Authorized Shares .

As of April 5, 2024, stock options covering 508,028 shares, each with an exercise price of $0.01 per share were the only outstanding

Stock Awards outstanding under our 2019 Plan.

Once the 2022 Plan became effective, no further grants were made under the 2019 Plan and

all shares that remained available for the issuance of awards under our 2019 Plan as of immediately prior to the time our 2022 Plan became

effective were rolled over into the 2022 Plan.

Once the 2022 Plan became

effective, no further grants were made under the 2019 Plan and all shares that remained available for the issuance of awards under our

2019 Plan as of immediately prior to the time our 2022 Plan became effective were rolled over into the 2022 Plan.

Plan Administration.

2019 Plan may be administered by our board of directors, and our board of directors may delegate such administration to a committee of

the board of directors (as applicable, the “Administrator”).

The Administrator, in its discretion, selects the individuals

to whom awards may be granted, the time or times at which such awards are granted and the terms and conditions of such awards.

The 2019 Plan may

be administered by our board of directors, and our board of directors may delegate such administration to a committee of the board of

directors (as applicable, the “Administrator”).

The Administrator, in its discretion, selects the individuals to whom awards

may be granted, the time or times at which such awards are granted and the terms and conditions of such awards.

Stock Options.

options entitle the holder to purchase a specified number of shares of common stock at a specified price (the exercise price), subject

to the terms and conditions of the stock option grant.

Our board of directors may grant either incentive stock options, which must comply

with Code Section 422, or nonqualified stock options.

ISO’s may only be granted to employees of the Company or a “parent corporation”

or “subsidiary corporation” thereof (as such terms are defined in Sections 424(e) and 424(f) of the Code).

Our Administrator

sets exercise prices and terms and conditions, except that stock options must be granted with an exercise price not less than 100% of

the fair market value of our common stock on the date of grant.

Unless our Administrator determines otherwise, fair market value means,

as of a given date, the closing price of our common stock.

At the time of grant, our board of directors determines the terms and conditions

of stock options, including the quantity, exercise price, vesting periods, term (which may not exceed 10 years) and other conditions on

Pursuant to the 2019 Plan, we may only issue 1,400,000 ISO’s.

Awards may be granted under

the 2019 Plan to officers, employees, directors, officers and of us and our subsidiaries.

Incentive stock options may be granted only

to employees of us or our subsidiaries.

Restricted Stock, Restricted

Stock Units and Other Stock-Based Awards.

Our board of directors may grant awards of restricted stock, which are shares of common stock

subject to specified restrictions, and restricted stock units, or RSUs, which represent the right to receive shares of our common stock

in the future.

These awards may be made subject to repurchase, forfeiture or vesting restrictions at the discretion of our board of directors’

The restrictions may be based on continuous service with us or the attainment of specified performance goals, as determined

by the board of directors.

Stock units may be paid in stock or cash or a combination of stock and cash, as determined by the board of

Other stock awards valued in whole or in part by reference to, or otherwise based on, Common Stock, including the appreciation

in value thereof (e.g., options or stock rights with an exercise price or strike price less than one hundred percent (100%) of the fair

market value of the common stock at the time of grant) may be granted either alone or in addition to stock awards provided for under the

Stock options entitle the

holder to purchase a specified number of shares of common stock at a specified price (the exercise price), subject to the terms and conditions

of the stock option grant.

Our board of directors may grant either incentive stock options, which must comply with Code Section 422, or

non-qualified stock options.

ISO’s may only be granted to employees of the Company or a “parent corporation” or “subsidiary

corporation” thereof (as such terms are defined in Sections 424(e) and 424(f) of the Code).

Our Administrator sets exercise prices

and terms and conditions;

except that stock options must be granted with an exercise price not less than 100% of the fair market value

of our common stock on the date of grant.

Unless our Administrator determines otherwise, fair market value means, as of a given date,

the closing price of our common stock.

At the time of grant, our board of directors determines the terms and conditions of stock options,

including the quantity, exercise price, vesting periods, term (which may not exceed 10 years) and other conditions on exercise.

to the 2019 Plan, we may only issue 35,000 ISOs.

Awards may be granted under the 2019 Plan to officers,

employees, directors, officers and of us and our subsidiaries.

Incentive stock options may be granted only to employees of us or our subsidiaries.

Restricted Stock, Restricted Stock Units and Other

Stock-Based Awards.

Our board of directors may grant awards of restricted stock, which are shares of common stock subject to specified

restrictions, and restricted stock units, or RSUs, which represent the right to receive shares of our common stock in the future.

awards may be made subject to repurchase, forfeiture or vesting restrictions at the discretion of our board of directors’ discretion.

The restrictions may be based on continuous service with us or the attainment of specified performance goals, as determined by the board

of directors.

Stock units may be paid in stock or cash or a combination of stock and cash, as determined by the board of directors.

stock awards valued in whole or in part by reference to, or otherwise based on, Common Stock, including the appreciation in value thereof

(e.g., options or stock rights with an exercise price or strike price less than one hundred percent (100%) of the fair market value of

the common stock at the time of grant) may be granted either alone or in addition to stock awards provided for under the 2019 Plan.

Stock Appreciation Rights.

Upon exercise, SARs entitle the holder to receive payment per share in stock or cash, or in a combination of stock and cash, equal

to the excess of the share’s fair market value on the date of exercise over the aggregate strike price of the number of Common Stock

equivalents with respect to which the Participant is exercising the SAR on such date (the “grant price”.

Exercise of a SAR

issued in tandem with a stock option will reduce the number of shares underlying the related stock option to the extent of the SAR exercised.

The term of a SAR cannot exceed 10 years.

Upon exercise,

SARs entitle the holder to receive payment per share in stock or cash, or in a combination of stock and cash, equal to the excess of the

share’s fair market value on the date of exercise over the aggregate strike price of the number of Common Stock equivalents with

respect to which the Participant is exercising the SAR on such date (the “grant price”.

Exercise of a SAR issued in tandem

with a stock option will reduce the number of shares underlying the related stock option to the extent of the SAR exercised.

of a SAR cannot exceed 10 years.

Changes to Capital Structure.

In the event there is a specified type of change in our capital structure, such as a stock split, reverse stock split or recapitalization,

appropriate adjustments will be made to (i) the class and maximum number of shares subject to the 2019 Plan, (ii) the class and maximum

number of shares that may be issued on the exercise of ISOs and (iii) the class and number of shares and exercise price, strike price

or purchase price, if applicable, of all outstanding stock awards.

there is a specified type of change in our capital structure, such as a stock split, reverse stock split or recapitalization, appropriate

adjustments will be made to (i) the class and maximum number of shares subject to the 2019 Plan, (ii) the class and maximum number of

shares that may be issued on the exercise of ISOs and (iii) the class and number of shares and exercise price, strike price or purchase

price, if applicable, of all outstanding stock awards.

Corporate Transactions.

The following applies to Stock Awards under the 2019 Plan in the event of a corporate transaction (as defined in the 2019 Plan), unless

otherwise provided in a participant’s stock award agreement or other written agreement with us or one of our affiliates or unless

otherwise expressly provided by the Board of Directors at the time of grant.

In the event of a corporate

transaction, the board of directors may take one of the following actions, contingent on the completion of the corporate transaction:

(i) arrange for the surviving or acquiring corporation (or its parent company) to assume, continue or substitute the Stock Award for a

similar stock award;

(ii) arrange for the assignment of any reacquisition or repurchase rights held by the Company in respect of common

stock issued pursuant to the Stock Award to the surviving or acquiring corporation (or its parent company);

(iii) accelerate the vesting

(in whole or in part) of the Stock Award;

(iv) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held

by the Company with respect to the Stock Award;

(v) cancel or arrange for the cancellation of the Stock Award, to the extent not vested

or not exercised prior to the effective time of the corporate transaction, in exchange for such cash consideration that the Board of Directors;

and (vi) make a payment equal to the excess, if any, of (A) the value of the property the participant would have received upon the exercise

of the Stock Award immediately prior to the effective time of the corporate transaction, over (B) any exercise price payable by such holder

in connection with such exercise The Board of Directors need not take the same action or actions with respect to all Stock Awards or portions

thereof or with respect to all participants.

The Board of Directors may also take different actions with respect to the vested and unvested

portions of a Stock Award.

Additionally, under the 2019

Plan, a Stock Award may be subject to additional acceleration of vesting and exercisability upon or after a Change in Control (as defined

in the 2019 Plan) as may be provided in the Grant Agreement for such Stock Award or as may be provided in any other written agreement

between the participant and the Company or any of its subsidiaries which may employ the participant, but in the absence of such provision,

no such acceleration will occur.

The following applies

to Stock Awards under the 2019 Plan in the event of a corporate transaction (as defined in the 2019 Plan), unless otherwise provided in

a participant’s stock award agreement or other written agreement with us or one of our affiliates or unless otherwise expressly

provided by the Board at the time of grant.

In the event of a corporate transaction, the board

of directors may take one of the following actions, contingent on the completion of the corporate transaction:

(i) arrange for the surviving

or acquiring corporation (or its parent company) to assume, continue or substitute the Stock Award for a similar stock award;

for the assignment of any reacquisition or repurchase rights held by the Company in respect of common stock issued pursuant to the Stock

Award to the surviving or acquiring corporation (or its parent company);

(iii) accelerate the vesting (in whole or in part) of the Stock

(iv) arrange for the lapse, in whole or in part, of any reacquisition or repurchase rights held by the Company with respect to

the Stock Award;

(v) cancel or arrange for the cancellation of the Stock Award, to the extent not vested or not exercised prior to the

effective time of the corporate transaction, in exchange for such cash consideration that the Board;

and (vi) make a payment equal to

the excess, if any, of (A) the value of the property the participant would have received upon the exercise of the Stock Award immediately

prior to the effective time of the corporate transaction, over (B) any exercise price payable by such holder in connection with such exercise

The Board need not take the same action or actions with respect to all Stock Awards or portions thereof or with respect to all participants.

The Board may also take different actions with respect to the vested and unvested portions of a Stock Award.

Additionally, under the 2019 Plan, a Stock Award

may be subject to additional acceleration of vesting and exercisability upon or after a Change in Control (as defined in the 2019 Plan)

as may be provided in the Grant Agreement for such Stock Award or as may be provided in any other written agreement between the participant

and the Company or any of its subsidiaries which may employ the participant, but in the absence of such provision, no such acceleration

Plan Amendment or Termination.

Our board of directors has the authority to amend, suspend or terminate our 2019 Plan, subject to certain conditions, including that

such action does not materially impair the existing rights of any participant without such participant’s written consent.

material amendments also require the approval of our stockholders.

No ISOs may be granted after the tenth anniversary of the date our

board of directors adopted our 2019 Plan.

of directors has the authority to amend, suspend or terminate our 2019 Plan, subject to certain conditions, including that such action

does not materially impair the existing rights of any participant without such participant’s written consent.

Certain material amendments

also require the approval of our stockholders.

No ISOs may be granted after the tenth anniversary of the date our board of directors adopted

our 2019 Plan.

Proteomedix Stock Option Plan

The PMX Option Plan was approved by Proteomedix’s board of directors

as of July 1, 2015, and provides for the grant of options to acquire shares in Proteomedix.

The terms of the PMX Option Plan are described

in more detail below.

The PMX Option Plan is administered by a plan administrator (one or

several persons) elected by Proteomedix’s board of directors (the “Proteomedix Board”) from time to time.

The plan administrator

acts within the guidelines set and approved by Proteomedix’s board of directors or a committee thereof and is authorized to, among

others, determine (i) which eligible persons are to receive awards under the PMX Option Plan, (ii) the time or times when such options

grants are to be made, (iii) the nature and the number of options covered by each such grant, (iv) the time or times at which each option

right is to become exercisable, (v) the vesting conditions applicable to the options, (vi) the maximum term for which the options are

to remain outstanding, and (vii) any terms and conditions of the options granted, in each case, subject to the guidelines set and approved

by Proteomedix’s board of directors or a committee thereof.

Persons eligible to participate in the PMX Option Plan are employees,

members of Proteomedix’s board of directors and consultants of Proteomedix or a subsidiary.

The plan administrator determines within

the guidelines set and approved by Proteomedix’s board of directors or a committee which eligible persons are to receive rights

to acquire options under the PMX Option Plan.

The number of shares that may be issued under the PMX Option Plan is

determined by the Proteomedix’s board of directors.

In the event common shares that otherwise would have been issuable under the

PMX Option Plan are withheld by Proteomedix in payment of the exercise price or withholding obligations, such shares shall remain available

for issuance under the PMX Option Plan.

In the event that an outstanding award expires or is cancelled, forfeited or terminated for any

reason, the shares allocable to the unexercised or unsettled portion shall remain available for issuance under the PMX Option Plan.

A participant may only exercise an option or stock appreciation right

to the extent that the option or stock appreciation right has vested and has not lapsed under the PMX Option Plan.

Unless otherwise determined

by Proteomedix’s board of directors at the grant date or set forth in the grant notice, an option or an award in the form of a restricted

stock unit or stock appreciation right granted under the PMX Option Plan typically vests as to 25.0% of the award at the end of the first

year following the vesting start date, with the remaining 75.0% of the award vesting monthly over the 3 years after the first year following

the vesting start date.

If indicated in the grant notice or otherwise resolved by Proteomedix’s

board of directors, upon the occurrence of a “Corporate Transaction” (as defined in the PMX Option Plan), all options (i)

shall fully vest and (ii) may be immediately exercised, except if such options are canceled by the plan administrator in exchange for

compensation equivalent to the economic value of the option under the PMX Option Plan.

Proteomedix has complete and exclusive power and authority to amend

or modify the PMX Option Plan in any or all respects.

No such amendment or modification shall, without the consent of the grantee, adversely

affect his/her rights and obligations under the PMX Option Plan.

The PMX Option Plan was approved by Proteomedix’s

board of directors as of July 1, 2015, and provides for the grant of options to acquire shares in Proteomedix.

The terms of the PMX Option

Plan are described in more detail below.

The PMX Option Plan is administered by a plan

administrator (one or several persons) elected by Proteomedix’s board of directors (the “Proteomedix Board”) from time

The plan administrator acts within the guidelines set and approved by Proteomedix’s board of directors or a committee thereof

and is authorized to, among others, determine (i) which eligible persons are to receive awards under the PMX Option Plan, (ii) the time

or times when such options grants are to be made, (iii) the nature and the number of options covered by each such grant, (iv) the time

or times at which each option right is to become exercisable, (v) the vesting conditions applicable to the options, (vi) the maximum term

for which the options are to remain outstanding, and (vii) any terms and conditions of the options granted, in each case, subject to the

guidelines set and approved by Proteomedix’s board of directors or a committee thereof.

Persons eligible to participate in the PMX

Option Plan are employees, members of Proteomedix’s board of directors and consultants of Proteomedix or a subsidiary.

administrator determines within the guidelines set and approved by Proteomedix’s board of directors or a committee which eligible

persons are to receive rights to acquire options under the PMX Option Plan.

The number of shares that may be issued under

the PMX Option Plan is determined by the Proteomedix’s board of directors.

In the event common shares that otherwise would have

been issuable under the PMX Option Plan are withheld by Proteomedix in payment of the exercise price or withholding obligations, such

shares shall remain available for issuance under the PMX Option Plan.

In the event that an outstanding award expires or is cancelled,

forfeited or terminated for any reason, the shares allocable to the unexercised or unsettled portion shall remain available for issuance

under the PMX Option Plan.

A participant may only exercise an option or stock

appreciation right to the extent that the option or stock appreciation right has vested and has not lapsed under the PMX Option Plan.

Unless otherwise determined by Proteomedix’s board of directors at the grant date or set forth in the grant notice, an option or

an award in the form of a restricted stock unit or stock appreciation right granted under the PMX Option Plan typically vests as to 25.0%

of the award at the end of the first year following the vesting start date, with the remaining 75.0% of the award vesting monthly over

the 3 years after the first year following the vesting start date.

If indicated in the grant notice or otherwise

resolved by Proteomedix’s board of directors, upon the occurrence of a “Corporate Transaction” (as defined in the PMX

Option Plan), all options (i) shall fully vest and (ii) may be immediately exercised, except if such options are canceled by the plan

administrator in exchange for compensation equivalent to the economic value of the option under the PMX Option Plan.

Proteomedix has complete and exclusive power and

authority to amend or modify the PMX Option Plan in any or all respects.

No such amendment or modification shall, without the consent

of the grantee, adversely affect his/her rights and obligations under the PMX Option Plan.

Security Ownership of Certain Beneficial Owners and Management

and Related Stockholder Matters.

The following table sets forth certain information

concerning the ownership of our common stock, with respect to:

(i) each person, or group of affiliated persons, known to us to be the

beneficial owner of more than five percent of our common stock;

(ii) each of our directors;

(iii) each of our named executive officers;

and (iv) all of our current directors and executive officers as a group.

Applicable percentage ownership is based on 44,358,422 shares of common

stock outstanding as of May 30, 2025.

We have determined beneficial ownership in accordance

with the rules of the SEC.

These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting

or investment power with respect to such securities.

In addition, pursuant to such rules, we deemed outstanding shares of common stock

subject to options or warrants held by that person that are currently exercisable or exercisable within 60 days of May 30, 2025.

not deem such shares outstanding, however, for the purpose of computing the percentage ownership of any other person.

Except as indicated

by the footnotes below, we believe, based on the information furnished to us, that the beneficial owners named in the table below have

sole voting and investment power with respect to all shares of our common stock that they beneficially own, subject to applicable community

property laws.

Shares of Common

Name and Address of Beneficial Owner (1)

Executive Officers and Directors

James Sapirstein

Timothy Ramdeen

Ralph Schiess

Christian Brühlmann

Neil Campbell

Andrew Oakley

All directors and named executive officers as a group (11 persons)

5% Stockholders

Altos Venture AG

2,695,931 (12)

Represents beneficial ownership of less than 1%.

Unless otherwise noted, the business address of each of the following entities or individuals is c/o Onconetix, Inc., 201 E.

Fifth Street, Suite 1900, Cincinnati, Ohio 45202.

Includes 3,477 restricted stock awards of which 3,318 do not vest until August 31, 2025 and 101 shares of common stock underlying options that are currently exercisable within 60 days of November 1, 2024.

Includes 3,477 restricted stock awards of which 3,318 do not vest until August 31, 2025 and 59 shares of common stock underlying options that are currently exercisable within 60 days of November 1, 2024.

Includes 3,318 restricted stock awards of which 3,318 do not vest until August 31, 2025.

Includes 3,396 restricted stock awards of which 3,318 do not vest until August 31, 2025.

Includes 177,462 shares of common stock issuable upon settlement of RSUs.

Schiess resigned as Chief Science Officer and Interim Chief Executive Officer on February 24, 2025.

Includes 177,462 shares of common stock issuable upon settlement of RSUs.

Brühlmann resigned as Chief Strategy Officer on February 18, 2025.

Consists of 29,574 shares of common stock.

Harmon resigned as Chief Financial Officer on June 8, 2024.

Campbell resigned as Chief Executive Officer on January 10, 2024.

Consists of 3,477 shares of common stock underlying options that are currently exercisable within 60 days of April 5, 2024.

Includes 1,709 restricted stock awards of which 1,709 do not vest until August 31, 2025.

Per Schedule 13D filed on September 26, 2024, Altos Venture AG (“Altos”) is the beneficial owner of 2,695,931 shares of Common Stock.

The address of Altos is Obertorweg 64, CH-4123, Allschwil, Switzerland.

Certain Relationships and Related

Transactions, and Director Independence.

The following is a description

of transactions since January 1, 2022 to which we were a party in which (i) the amount involved exceeded or will exceed the lesser of

$120,000 of one percent (1%) of our average total assets at year-end for the last two completed fiscal years and (ii) any of our directors,

executive officers or holders of more than 5% of our capital stock, or any member of the immediate family of, or person sharing the household

with, any of the foregoing persons, who had or will have a direct or indirect material interest, other than equity and other compensation,

termination, change in control and other similar arrangements, which are described under “Executive and Director Compensation.”

On January 23, 2024, the

Company issued a non-convertible debenture (the “Debenture”) in the principal sum of $5.0 million, in connection with a Subscription

Agreement, to Altos Ventures, a stockholder of the Company.

The Debenture has an interest rate of 4.0% per annum, and the principal and

accrued interest are payable in full upon the earlier of (i) the closing under the Subscription Agreement and (ii) June 30, 2024.

Additionally,

the $5.0 million subscription amount under the Subscription Agreement shall be increased by the amount of interest payable under the Debenture.

The following is a description of transactions

since January 1, 2023 to which we were a party in which (i) the amount involved exceeded or will exceed the lesser of $120,000 of one

percent (1%) of our average total assets at year-end for the last two completed fiscal years and (ii) any of our directors, executive

officers or holders of more than 5% of our capital stock, or any member of the immediate family of, or person sharing the household with,

any of the foregoing persons, who had or will have a direct or indirect material interest, other than equity and other compensation, termination,

change in control and other similar arrangements, which are described under “Executive and Director Compensation.”

On January 23, 2024, the Company issued a non-convertible

debenture (the “Debenture”) in the principal sum of $5.0 million, in connection with a Subscription Agreement, to Altos Ventures,

a stockholder of the Company.

The Debenture has an interest rate of 4.0% per annum, and the principal and accrued interest are payable

in full upon the earlier of (i) the closing under the Subscription Agreement and (ii) June 30, 2024.

Additionally, the $5.0 million subscription

amount under the Subscription Agreement shall be increased by the amount of interest payable under the Debenture.

Related party advances

During the year ended December

31, 2023, the Company’s Audit Committee completed a review of the Company’s expenses due to certain irregularities identified

with regards to the related party balance.

Based on the results of the review, it was determined that the Company paid and recorded within

selling, general and administrative expenses, personal expenditures of the Company’s former CEO and an accounting employee who was

also the former CEO’s assistant, during 2022 and during the first three quarters of 2023.

The Company evaluated the receivable,

which aggregated to approximately $522,000 as of September 30, 2023, and which represented the total of the items identified as personal

in nature for which the Company did not anticipate recovery from the related party.

As the Company concluded that the remaining amounts

are not likely to be recovered, this would not cause an adjustment to previously issued financial statements.

The Company recorded a corresponding

reserve for the full amount, resulting in a net related party receivable balance of $0 and a loss on related party receivable of approximately

$266,000, which was recorded in selling, general, and administrative expenses in the accompanying consolidated statements of operations

and comprehensive loss for the year ended December 31, 2023.

During the fourth quarter of 2023, the Company recorded a recovery of approximately

$159,000 with respect to amounts that the former CEO agreed to repay the Company, through a reduction of amounts that were due to him

from the Company under his indemnification rights pursuant to his employment agreement.

Lease Agreement

On February 28, 2022, the Company entered into a short-term lease in

During the year ended December 31, 2023, the Company’s

Audit Committee completed a review of the Company’s expenses due to certain irregularities identified with regards to the related

party balance.

Based on the results of the review, it was determined that the Company paid and recorded within selling, general and administrative

expenses, personal expenditures of the Company’s former CEO and an accounting employee who was also the former CEO’s assistant,

during 2022 and during the first three quarters of 2023.

The Company evaluated the receivable, which was approximately $363,000, after

recording a recovery of approximately $159,000, and which represented the total of the items identified as personal in nature for which

the Company did not anticipate recovery from the related party.

During 2023, the Company recorded a corresponding reserve for the full

amount, resulting in a net related party receivable balance of $0 as of December 31, 2023.

There were no such transactions during the

year ended December 31, 2024.

Lease Agreements

The Company entered into a short-term lease in

Palm Beach, Florida with an unrelated party, with a commencement date of May 1, 2022, for approximately $14,000 per month.

which was personally guaranteed by the Company’s former Chief Executive Officer, ended on April 30, 2023.

During the years ended

December 31, 2023 and 2022, the Company incurred rent expense on this lease of approximately $51,000 and $129,000, respectively, and variable

lease expense of approximately $4,000 and $12,000, respectively.

which was personally guaranteed by the Company’s former CEO, ended on April 30, 2023.

During the year ended December 31, 2023, the

Company incurred rent expense on this lease of approximately $51,000, and variable lease expense of approximately $4,000.

Consulting Agreement

February 6, 2024, the Company appointed Thomas Meier, PhD, as a member of the Company’s board of directors.

Meier provides consulting

services to Proteomedix, through a consulting agreement that was effective January 4, 2024.

On February 6, 2024,

the Company appointed Thomas Meier, PhD, as a member of the Company’s board of directors.

Meier provides consulting services

to Proteomedix, through a consulting agreement that was effective January 4, 2024.

The Company recorded approximately $58,000 in related

expenses during the year ended December 31, 2024, of which approximately $11,000 is included in accrued expenses in the accompanying consolidated

financial statements as of December 31, 2024.

On February 28, 2025, the Company and James Sapirstein

entered into a consulting agreement, pursuant to which Mr.

Sapirstein will be compensated on an hourly basis at a rate of $400 per hour

for up to twenty hours per week.

As of March 28, 2025, James Sapirstein resigned as Executive Chairman and a member of the Board.

Director Independence

The Board has evaluated each

of its directors’ independence from the Company based on the definition of “independence” established by Nasdaq and

has determined that each of Simon Tarsh, Timothy Ramdeen, James Sapirstein and Ajit Singh are independent directors, constituting a majority

of the Board.

The Board has further determined that each member of our Audit Committee, Compensation Committee and Nominating and Corporate

Governance Committee is “independent” under applicable Nasdaq rules.

The Board has also determined

that each member of our audit committee is “independent” for purposes the Exchange Act.

In its evaluation of each director’s

or nominee’s independence from the Company, the Board reviewed whether any transactions or relationships currently exist or existed

The Board has evaluated each of its directors’

independence from the Company based on the definition of “independence” established by Nasdaq and has determined that each

of Simon Tarsh, Timothy Ramdeen, Andrew Oakley and Ajit Singh are independent directors, constituting a majority of the Board.

has further determined that each member of our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee

is “independent” under applicable Nasdaq rules.

The Board has also determined that each member

of our audit committee is “independent” for purposes the Exchange Act.

In its evaluation of each director’s or

nominee’s independence from the Company, the Board reviewed whether any transactions or relationships currently exist or existed

during the past year between each director or nominee and the Company and its subsidiaries, affiliates, equity investors, or independent

3 unchanged sentences

Audit and Non-Audit Fees

EisnerAmper served as the

independent registered public accounting firm to audit our books and accounts for the fiscal year ended December 31, 2023.

Mayer Hoffman McCann P.C.

(“MHM”) served as the independent registered public accounting firm to audit our books and accounts for the fiscal year ended

December 31, 2022.

Substantially all of MHM’s personnel, who work under the control of MHM shareholders, are employees of wholly

owned subsidiaries of CBIZ, Inc., which provides personnel and various services to MHM in an alternative practice structure.

The table below presents

the aggregate fees billed for professional services rendered by EisnerAmper for the year ended December 31, 2023.

EisnerAmper served as the independent registered

public accounting firm to audit our books and accounts for the fiscal year ended December 31, 2023.

Malone-Bailey served as the independent

registered public accounting firm to audit our books and accounts for the fiscal year ended December 31, 2024.

The table below presents the aggregate fees billed

for professional services rendered by Malone-Bailey and EisnerAmper (prior auditor) for the years ended December 31, 2024 and

2023, respectively.

EiEisnerAmper

Audit-related fees

All other fees

In the above table, “audit

fees” are fees billed for services provided related to the audit of our annual consolidated financial statements, quarterly reviews

of our interim condensed financial statements, and services normally provided by EisnerAmper in connection with regulatory filings or

engagements for that fiscal period.

The table below presents

the aggregate fees billed for professional services rendered by MHM for the years ended December 31, 2023 and 2022.

Malone-Bailey

Audit-related fees

1 unchanged sentence

In the above table, “audit

fees” are fees billed for services provided related to the audit of our annual financial statements, quarterly reviews of our interim

condensed financial statements, and services normally provided by MHM in connection with regulatory filings or engagements for those fiscal

“Tax fees” consist of amounts billed by an associated entity of MHM for services in connection with the preparation

of our federal and state tax returns.

fees” are fees billed for services provided related to the audit of our annual consolidated financial statements, quarterly reviews

of our interim condensed financial statements, and services normally provided by EisnerAmper and Malone-Bailey in connection with regulatory

filings or engagements for that fiscal period.

Pre-Approval Policy

It is the Audit Committee’s

policy to approve in advance the types and amounts of audit, audit-related, tax, and any other services to be provided by our independent

registered public accounting firm.

In situations where it is not practicable to obtain full Audit Committee approval, the Audit Committee

has delegated authority to the Chair of the Audit Committee to grant pre-approval of audit and permissible non-audit services and any

associated fees.

It is the Audit Committee’s policy to approve

in advance the types and amounts of audit, audit-related, tax, and any other services to be provided by our independent registered public

accounting firm.

In situations where it is not practicable to obtain full Audit Committee approval, the Audit Committee has delegated

authority to the Chair of the Audit Committee to grant pre-approval of audit and permissible non-audit services and any associated fees.

Any pre-approved decisions by the Chair are required to be reviewed with the Audit Committee at its next scheduled meeting.

Our Audit Committee was formed

upon the consummation of our initial public offering.

As a result, the audit committee did not pre-approve all of the foregoing services,

although any services rendered prior to the formation of our audit committee were approved by our board of directors.

Since the formation

of our Audit Committee, and on a going-forward basis, the Audit Committee has and will pre-approve all auditing services and permitted

non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions

for non-audit services described in the Exchange Act which are approved by the audit committee prior to the completion of the audit).

Our Audit Committee was formed upon the consummation

of our initial public offering.

As a result, the audit committee did not pre-approve all of the foregoing services, although any services

rendered prior to the formation of our audit committee were approved by our board of directors.

Since the formation of our Audit Committee,

and on a going-forward basis, the Audit Committee has and will pre-approve all auditing services and permitted non-audit services to

be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions for non-audit services

described in the Exchange Act which are approved by the audit committee prior to the completion of the audit).

Exhibit and Financial Statement Schedules.

6 unchanged sentences

Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2024 and 2023 F-5

Consolidated Statements

of Convertible Redeemable Preferred Stock and Stockholders’ Equity (Deficit) for the years ended December 31, 2023 and 2022 F-6

Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the years ended December 31, 2024 and 2023 F-6

Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023 F-7

1 unchanged sentence

of Independent Registered Public Accounting Firm

the Board of Directors and Stockholders of

on the Financial Statements

We have audited the accompanying consolidated balance

sheet of Onconetix Inc.

and Subsidiary (the “Company”) as of December 31, 2023, and the related consolidated statements of

operations and comprehensive loss, convertible redeemable preferred stock and stockholders’ equity (deficit), and cash flows for

the year then ended, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial

statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023, and the

consolidated results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally

accepted in the United States of America.

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

As discussed in Note

2 to the financial statements, the Company has incurred substantial operating losses since inception and expects to continue to incur

significant operating losses for the foreseeable future, which raises substantial doubt about its ability to continue as a going concern.

To the Board of Directors and Stockholders of

Onconetix, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheet of Onconetix Inc.

and its subsidiary (collectively, the “Company”) as of December 31, 2024, and the related

consolidated statements of operations and comprehensive loss, convertible preferred stock and stockholders’ equity (deficit), and

cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”).

opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024,

and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted

in the United States of America.

Going Concern

The accompanying financial statements have been

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

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

suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue

as a going concern.

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

The financial statements do not include any adjustments

that might result from the outcome of this uncertainty.

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

Our responsibility is to express an opinion on the Company’s

financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board

(United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

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

conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

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

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

As part of our audit,

we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion

on the effectiveness of the Company’s internal control over financial reporting.

The financial statements do not include

any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

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

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

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

federal securities laws and the applicable

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

We conducted our audit in accordance with the

standards of the PCAOB.

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

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

The Company is not required to have, nor were we engaged

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

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

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

control over financial reporting.

Accordingly, we express no such opinion.

audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or

fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding

the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant

estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides

a reasonable basis for our opinion.

EisnerAmper LLP

have served as the Company’s auditor since 2023.

REPORT OF INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors

and Stockholders of Onconetix, Inc.

Opinion on the Consolidated Financial Statements

Our audit included performing procedures to assess

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

to those risks.

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

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

the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ MaloneBailey, LLP

www.malonebailey.com

We have served as the Company’s auditor

MALONEBAILEY LLP

Houston, Texas

of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of

Onconetix, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheet of Onconetix Inc.

(formerly known as Blue Water Vaccines Inc.)(the “Company”) as of December 31, 2022, and

the related consolidated statements of operations and comprehensive loss, convertible redeemable preferred stock and stockholders’

equity, and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December

31, 2022, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally

and Subsidiary (the “Company”) as of December 31, 2023, and the related consolidated statements

of operations and comprehensive loss, convertible preferred stock and stockholders’ equity (deficit), and cash flows for the year

then ended, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial

statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023, and the

consolidated results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally

accepted in the United States of America.

Going Concern

The accompanying financial statements have been

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

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

incurred substantial operating losses since inception and expects to continue to incur significant operating losses for the foreseeable

future, which raises substantial doubt about its ability to continue as a going concern.

Management’s plans in regard to these matters

are also described in Note 2.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

23 unchanged sentences

We believe that our audit provides a reasonable basis for our opinion.

/s/ EisnerAmper LLP

We served as the Company’s auditor from

2023 to 2024.

/s/ Mayer Hoffman McCann P.C.

Los Angeles, California

March 8, 2023

EISNERAMPER LLP

Iselin, New Jersey

April 11, 2024, except for the effects of the reverse stock split discussed

in Note 1 to the financial statements, as to which the date is May 30, 2025.

ONCONETIX, INC.

3 unchanged sentences

Prepaid expenses and other current assets

Receivable from related parties, net

Total current assets

Prepaid expenses, long-term

Property and equipment, net

Deferred offering costs

Property and equipment, net

Operating right of use asset

Intangible assets, net

LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)

LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

Current liabilities

1 unchanged sentence

Accrued expenses

Notes payable, net of debt discount of $ 381,627

Notes payable, net of debt discounts of $ 4,966 and $ 381,627 at December 31, 2024 and 2023, respectively

Operating lease liability, current

Contingent warrant liability

Subscription agreement liability - Related Party

Contingent warrant liabilities

Total current liabilities

Subscription agreement liability

Note payable, net of current portion

Subscription agreement liability, long-term related party

Pension benefit obligation

3 unchanged sentences

Commitments and Contingencies (see Note 10)

Series B Convertible Redeemable Preferred stock, $ 0.00001 par value, 2,700,000 and 0 shares authorized at December 31, 2023 and 2022, respectively;

2,696,729 and 0 shares issued and outstanding at December 31, 2023 and 2022, respectively

Stockholders’ equity (deficit)

Series A Convertible Preferred stock, $ 0.00001 par value, 10,000 and 0 shares authorized at December 31, 2023 and 2022, respectively;

Series B Convertible Redeemable Preferred stock, $ 0.00001 par value, 2,700,000 shares authorized at December 31, 2024 and 2023, 0 and 2,696,729 shares issued and outstanding at December 31, 2024 and 2023, respectively

Series C Redeemable Preferred Stock, $ 0.00001 par value, 10,000 shares authorized, 3,499 and 0 shares issued and outstanding at December 31, 2024 and 2023, respectively

Stockholders' equity

Series A Convertible Preferred stock, $ 0.00001 par value, 10,000 shares authorized at December 31, 2024 and 2023;

0 and 3,000 shares issued and outstanding at December 31, 2024 and 2023, respectively;

1 unchanged sentence

Common stock, $ 0.00001 par value, 250,000,000 shares authorized at December 31, 2024 and 2023;

22,841,975 and 15,724,957 shares issued at December 31, 2023 and 2022, respectively;

11,767,443 and 571,033 the shares issued at December 31, 2024 and 2023, respectively;

11,754,509 and 558,099 shares outstanding at December 31, 2024 and 2023, respectively

1 unchanged sentence

Treasury stock, at cost;

517,399 and 459,729 shares of common stock at December 31, 2023 and 2022, respectively

12,934 shares of common stock at December 31, 2024 and 2023

Due from shareholders

Accumulated deficit

1 unchanged sentence

( 56,786,194 )

Accumulated other comprehensive income

Total Onconetix stockholders’ equity (deficit)

Accumulated other comprehensive income (loss)

( 2,723,397 )

Total Onconetix, Inc.

stockholders’ equity (deficit)

( 5,602,028 )

Non-controlling interest

Total stockholders’ equity

Total liabilities, convertible redeemable preferred stock, and stockholders’ equity (deficit)

Total liabilities, convertible preferred stock, and stockholders’ equity

The accompanying notes are an integral part

7 unchanged sentences

Research and development

Impairment of ENTADFI assets

Impairment of ENTADFI

Impairment of intangibles

Impairment of goodwill

Impairment of deposit on asset purchase agreement

3 unchanged sentences

( 36,034,595 )

Other income (expense)

Other (expense) income

Loss on extinguishment of note payable

Interest expense - related party

Interest expense

Interest income

Change in fair value of subscription agreement liability

Change in fair value of contingent warrant liability

Total other income (expense)

( 3,259,000 )

Change in fair value of contingent warrant liabilities

Total other (loss)

( 3,247,448 )

( 1,387,692 )

Loss before income taxes

4 unchanged sentences

$ ( 37,409,694 )

Cumulative preferred stock dividends

Net loss attributable to common stockholders

Deemed dividend Series C preferred stock

Net loss applicable to common stockholders

( 58,897,427 )

( 37,409,694 )

Net loss per share attributable to common stockholders, basic and diluted

Net loss per share, basic and diluted

Weighted average number of common shares outstanding, basic and diluted

Other comprehensive loss

Other comprehensive income (loss)

$ ( 58,691,023 )

1 unchanged sentence

Foreign currency translation

( 5,342,327 )

Change in pension benefit obligation

Total comprehensive loss attributable to common stockholders

Total comprehensive loss

$ ( 63,795,340 )

3 unchanged sentences

ONCONETIX, INC.

Statements of Convertible Redeemable Preferred Stock and Stockholders’ Equity (Deficit)

For the years ended December 31, 2023 and 2022

Consolidated Statements of Convertible Preferred

Stock and Stockholders’ Equity (Deficit)

A Preferred Stock

Comprehensive

Non-controlling

Stockholders'

Equity (Deficit)

at December 31, 2021

Balance at December 31, 2023

$ ( 56,786,194 )

Issuance of common stock in initial public offering, net of $ 2.9 million of offering costs

of convertible preferred stock to common stock upon initial public offering

Issuance of common stock and warrants in April private placement, net of $ 1.1 million of offering costs

Issuance of common stock and warrants in August private placement, net of $ 2.2 million of offering costs

of stock options

of pre-funded warrants

of restricted common stock

of treasury shares

$ ( 5,602,028 )

Issuance of common stock

and warrants from exercise of preferred investment options, net of issuance costs

Grant and immediate exercise

Issuance of shares in connection

with related party subscription agreement

Conversion of Series A Preferred

Stock to common stock

Conversion of Series B Preferred

Stock to common stock

Exercise of stock options

Stock-based compensation

Issuance of restricted common

Forfeitures of restricted stock

Cash in lieu of shares

Foreign currency translation

( 5,342,327 )

at December 31, 2022

( 5,342,327 )

Issuance of common stock

in connection with the ELOC

Issuance of restricted common

stock in exchange in exchange for options

( 7,184,751 )

of common stock from exercise of preferred investment options

of warrants for settlement of contingent warrants

of Series A Preferred Stock

of common stock and Series B Preferred Stock in connection with PMX Transaction

of stock-based compensation plan awards in connection with PMX Transaction

of stock options

of pre-funded warrants

of restricted stock

of treasury shares

currency translation adjustment

in pension benefit obligation

Adjustment to redeemable

Series C preferred Stock

Changes in pension benefit

( 58,691,023 )

5 unchanged sentences

$ ( 2,723,397 )

The accompanying notes

are an integral part of these consolidated financial statements.

$ ( 250,308 )

Stockholders'

Comprehensive

Balance at December 31, 2022

$ ( 19,376,500 )

Issuance of common stock

from exercise of preferred investment options

Issuance of warrants for

settlement of contingent warrants

Issuance of Series A Preferred

Issuance of common stock

and Series B Preferred Stock in connection with PMX Transaction

Assumption of stock-based

compensation plan awards in connection with PMX Transaction

Exercise of stock options

Exercise of pre-funded warrants

Issuance of restricted stock

Forfeitures of restricted

Stock-based compensation

Purchase of treasury shares

Foreign currency translation

Changes in pension benefit

( 37,409,694 )

Balance at December 31,

$ ( 625,791 )

$ ( 56,786,194 )

$ ( 5,602,028 )

The accompanying notes are an integral part

of these consolidated financial statements.

ONCONETIX, INC.

1 unchanged sentence

Cash flows from operating activities

$ ( 58,691,023 )

$ ( 37,409,694 )

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

Impairment of ENTADFI assets

Impairment of deposit on asset purchase agreement

Fair value of subscription agreement liability

Impairment of other long-lived assets

Loss on impairment of goodwill

Loss on impairment of ENTADFI

Loss on impairment of intangibles

Amortization of debt discount

Amortization of debt discount - related party

Loss on related party receivable

Loss on extinguishment of note payable

Depreciation and amortization

Fair value of subscription agreement liability

Net periodic pension benefit cost

Stock-based compensation

Loss on impairment of other long-lived assets

Loss on related party receivable

Loss on impairment of inventory of ENTADFI

Change in fair value of contingent warrant liabilities

( 1,250,466 )

Change in fair value of subscription agreement liability

Recovery of related party receivable

Provision for excess inventory

Deferred tax benefit

Impairment of inventory

Depreciation and amortization

Change in fair value of contingent warrant liability

Change in fair value of subscription agreement liability

Net periodic pension benefit

Issuance of restricted common stock

Changes in operating assets and liabilities:

( 1,045,181 )

Amortization of deferred offering costs

Gain on settlement of contingent warrant liabilities

Changes in assets and liabilities:

Accounts receivable

Prepaid expenses and other current assets

Other noncurrent assets

Prepaid expenses and other assets

Prepaid expenses, LT

Accounts payable

( 1,477,075 )

Accrued expenses

( 1,129,050 )

Net cash used in operating activities

( 10,495,816 )

( 13,581,018 )

Cash flows from investing activities

Acquisition of assets, including transaction costs of $ 79,771

Deposit made in connection with asset purchase agreement

Acquisition of assets

( 6,079,771 )

Cash acquired through business combination

Purchases of other long-lived assets

Net advances to related parties

Purchases of property and equipment

Deposit made in connection with asset purchase agreement

( 3,500,000 )

Purchase of other long-lived assets

Receivable from related party

Purchase of property and equipment

Net cash used in investing activities

( 8,649,035 )

Cash flows from financing activities

Purchase of treasury shares

Payment of deferred offering costs

Principal payment of note payable

Proceeds from issuance of notes payable - related party

Payment of financing costs

Payment on note payables

( 1,345,521 )

( 1,000,000 )

Proceeds from exercise of preferred investment options, net

Proceeds from exercise of stock options

Proceeds from issuance of common stock in initial public offering, net of underwriting discount

Payments of initial public offering costs

Proceeds from issuance of common stock and warrants in private placements, net of placement agent discount

Payment of private placement issuance costs

Proceeds from exercise of pre-funded warrants

Proceeds from exercise of warrants

Proceeds from issuance of Series C Preferred Stock and warrants

Proceeds from purchases of common stock

Cash in lieu of shares

Deferred financing costs

Purchase of treasury shares

Net cash provided by financing activities

Effect of exchange rate changes on cash

Net increase (decrease) in cash

Net (decrease) in cash

( 3,907,835 )

( 21,198,323 )

Cash, beginning of period

Cash, end of period

Cash paid for interest

Noncash investing and financing activities:

Inventory and intangible assets acquired through issuance of notes payable

Effect of business combination (Note 5)

Settlement of note payable through issuance of Series A convertible preferred stock

Incremental fair value of exchanged preferred investment options

Deferred offering costs included in accounts payable

Deferred offering costs included in accounts payable and accrued expenses

Recognition of contingent warrant liability

1 unchanged sentence

Deferred offering costs previously included in prepaid expenses

Effect of business combination (Note 5)

Conversion of Series B Preferred Stock to common stock

Settlement of related party note payable and accrued interest through issuance of common stock

Settlement of note payable through issuance of Series A convertible preferred stock

Exercise of pre-funded warrants

1 unchanged sentence

Restricted stock forfeitures

Payment of accrued bonus through related party receivable

Conversion of Series Seed Preferred Stock to common stock upon initial public offering

Establishment of operating right-of-use asset

Conversion to equity of non-controlling interest

D&O insurance premium financed

Receivable from shareholders for shares issued

Measurement Period Adjustments from Proteomedix acquisition

Adjustment to redeemable Series C preferred stock

Deemed dividend Series C preferred stock

The accompanying notes are an integral part

5 unchanged sentences

Onconetix, Inc.

known as Blue Water Biotech, Inc.

and Blue Water Vaccines Inc.) (the “Company” or “Onconetix”) was formed on October

26, 2018, and is a commercial stage biotechnology company focused on the research, development, and commercialization of innovative solutions

for men’s health and oncology.

(formerly known as Blue Water

Biotech, Inc.

and Blue Water Vaccines Inc.) (the “Company” or “Onconetix”) was formed on October 26, 2018, and

is a commercial stage biotechnology company focused on the research, development, and commercialization of innovative solutions for men’s

health and oncology.

On December 15, 2023, Onconetix acquired

100 % of the issued and outstanding voting equity interests in Proteomedix AG, a Swiss company (“Proteomedix”), and its related

diagnostic product Proclarix.

As a result of this transaction, Proteomedix became a wholly owned subsidiary of Onconetix (see Note 5).

Proteomedix is a healthcare company whose mission is to transform prostate cancer diagnosis.

Proteomedix has identified novel biomarker

signatures with utility in prostate cancer diagnosis, prognosis and therapy management.

In April 2023, the Company acquired ENTADFI®,

a Food and Drug Administration (“FDA”)-approved, once daily pill that combines finasteride and tadalafil for the treatment

of benign prostatic hyperplasia.

Historically, the Company’s focus was on

the research and development of transformational vaccines to prevent infectious diseases worldwide, until the third quarter of 2023, at

which time the Company halted its efforts on vaccine development activities to focus on commercialization activities for ENTADFI and pursue

other potential acquisitions.

However, in light of (i) the time and resources needed to continue pursuing commercialization of ENTADFI,

and (ii) the Company’s cash runway and indebtedness, the Company has abandoned commercialization of ENTADFI and is still working

with an investment advisor to assist with the potential sale or other transaction of the ENTADFI assets.

There is currently no plan to

resume commercialization of ENTADFI, and as such, if we are not able to consummate a sale or other transaction of the ENTADFI assets,

we may abandon the assets and destroy our inventory of the product.

Based on the circumstances surrounding ENTADFI, the ENTADFI assets

were fully impaired at June 30, 2024 (see Notes 4 and 5).

On April 21, 2023, the Company filed an amendment

to its Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware to change its corporate name from “Blue

Water Vaccines Inc.” to “Blue Water Biotech, Inc.” The name change was effective as of April 21, 2023.

On December 15,

Onconetix acquired 100 % of the issued and outstanding voting equity interests in Proteomedix AG, a Swiss company (“Proteomedix”),

and its related diagnostic product Proclarix.

As a result of this transaction, Proteomedix became a wholly owned subsidiary of Onconetix

(see Note 5).

In April 2023, the Company acquired ENTADFI®, a Food and Drug Administration (“FDA”)-approved, once daily

pill that combines finasteride and tadalafil for the treatment of benign prostatic hyperplasia.

Historically, the Company’s

focus was on the research and development of transformational vaccines to prevent infectious diseases worldwide, until the third quarter

of 2023, at which time the Company deprioritized its efforts on vaccine development activities to focus on commercialization activities

for ENTADFI® and pursue other potential acquisitions.

In light of (i) the time and resources needed to continue pursuing commercialization

of ENTADFI, and (ii) the Company’s cash runway and indebtedness, the Company has determined to temporarily pause its commercialization

of ENTADFI, as it considers strategic alternatives.

The Company expects to appoint a new Chief Executive Officer in the second quarter

of 2024, after which the new CEO and the Board will reassess its ENTADFI program in light of the foregoing and other relevant factors.

On April 21, 2023, the Company

filed an amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware to change its corporate

name from “Blue Water Vaccines Inc.” to “Blue Water Biotech, Inc.” The name change was effective as of April 21,

On December 15, 2023, the Company filed an amendment to its Amended and Restated Certificate of Incorporation with the Secretary

of State of Delaware to change its corporate name from “Blue Water Biotech, Inc.” to “Onconetix, Inc.” In connection

with each of the name changes, the Company also amended the Company’s bylaws to reflect the new corporate name.

2023, the Company filed an amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware

to change its corporate name from “Blue Water Biotech, Inc.” to “Onconetix, Inc.” In connection with each of the

name changes, the Company also amended the Company’s bylaws to reflect the new corporate name.

Reverse Stock Split

On September 24, 2024, the Company effected a

reverse stock split of all shares of its issued and outstanding Common Stock at a ratio of one-for-forty (1:40).

The Company accounted

for the reverse stock split on a retrospective basis pursuant to Accounting Standards Codification (“ASC”) 260, Earnings

All issued and outstanding common stock, common stock warrants, and share-based awards’ exercise prices and per share

data have been adjusted in these consolidated financial statements, on a retrospective basis, to reflect the reverse stock split for all

periods presented.

The number of authorized shares and par value of the preferred stock and common stock were not adjusted because of

the reverse stock split.

Basis of Presentation and Principles of Consolidation

The Company’s consolidated financial statements have been prepared

in conformity with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) and include the

accounts of Onconetix and its 100 % wholly owned subsidiary, Proteomedix, since the acquisition date of December 15, 2023.

All significant

intercompany balances and transactions have been eliminated in consolidation.

Certain reclassifications

have been made to prior year amounts reported in the accompanying consolidated statement of cash flows to conform to the current year

presentation.

These reclassifications, which resulted in a difference of approximately $ 23,000 between operating and investing cash flow

activity, are not significant and had no impact on the previously reported financial position or results of operations of the Company.

Initial Public Offering

On February 23, 2022, the

Company completed its initial public offering (“IPO”) in which the Company issued and sold 2,222,222 shares of its common

stock, at a price to the public of $ 9.00 per share.

Proceeds from the IPO, net of underwriting discounts, commissions, and offering costs

of $ 2.9 million, were $ 17.1 million.

In connection with the completion of the IPO, all outstanding shares of convertible preferred stock

were converted into 5,626,365 shares of common stock (see Note 9).

Note 2 — Going Concern and Management’s Plans

The Company’s operating

activities to date have been devoted to seeking licenses, engaging in research and development activities, potential asset and business

acquisitions, and expenditures associated with the commercial launch of ENTADFI®.

The Company has financed its operations since inception

primarily using proceeds received from seed investors and proceeds received from its IPO and subsequent debt and equity offerings.

the year ended December 31, 2022, the Company received an aggregate of approximately $ 33.1 million in net cash proceeds from its IPO and

two private placements, and during the year ended December 31, 2023, the Company received net proceeds of approximately $ 2.3 million in

connection with the exercise by an investor of preferred investment options (see Note 9).

In addition, on January 23, 2024, the Company

received net cash proceeds of $ 4.6 million in exchange for the issuance of a debenture.

The debenture is repayable in full upon the earlier

of (i) the closing of a subscription agreement, which was entered into in connection with the acquisition of Proteomedix, and (ii) June

30, 2024 (see Note 14).

The Company has incurred

substantial operating losses since inception and expects to continue to incur significant operating losses for the foreseeable future.

As of December 31, 2023, the Company had cash of approximately $ 4.6 million, a working capital deficit of approximately $ 11.4 million

and an accumulated deficit of approximately $ 56.8 million.

The Company’s consolidated financial statements

have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S.

and include the accounts of Onconetix and its 100 % wholly owned subsidiary, Proteomedix, since the acquisition date of December 15, 2023.

All significant intercompany balances and transactions have been eliminated in consolidation.

The non-controlling interest recorded in the accompanying

consolidated financial statements as of December 31, 2023 relates to currently outstanding stock-based awards issued by Proteomedix, which

were assumed by Onconetix in connection with the acquisition of Proteomedix (see Note 5).

During the year ended December 31, 2024, the

non-controlling interest converted to equity with the issuance of restricted common stock in exchange for PMX options.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

2 — Going Concern and Management’s Plans (cont.)

These factors, along

with the Company’s forecasted future cash flows, indicate that the Company will be unable to meet its contractual commitments

and obligations as they come due in the ordinary course of business, within one year following the issuance of these consolidated

Note 2 — Going Concern and Management’s

The Company’s operating activities to date

have been devoted to seeking licenses, engaging in research and development activities, potential asset and business acquisitions, and

expenditures associated with the previously planned commercial launch of ENTADFI, and the commercialization of Proclarix.

The Company has incurred substantial operating

losses since inception and expects to continue to incur significant operating losses for the foreseeable future.

As of December 31, 2024, the Company had cash

of approximately $ 0.6 million, a working capital deficit of approximately $ 17.3 million and an accumulated deficit of approximately $ 115.7

During the year ended December 31, 2024, the Company used approximately $ 10.5 million in cash for operating activities.

as of May 30, 2025, the Company’s cash balance was approximately $ 0.5 million.

The Company’s current cash balance is not sufficient

to fund its operations through the end of December 2025.

In December 2024, the Company began drawing on the Equity Financing Line of Credit

(“ELOC”), which it entered into on October 2, 2024, referred herein as the ELOC Purchase Agreement;

however, projections are

indicative that it will be unable to meet its contractual commitments and obligations as they come due in the ordinary course of business.

Effective in 2025, the Company has redeemed the preferred stock of approximately $ 1.71 million.

The Company will require significant additional

capital in the short-term to fund its continuing operations, satisfy existing and future obligations and liabilities, including the funds

needed to support the Company’s working capital needs and business activities.

These business activities include the commercialization

of Proclarix, and the development and commercialization of the Company’s future product candidates.

These factors raise substantial

doubt about the Company’s ability to continue as a going concern within one year from the date of the issuance of these consolidated

financial statements.

The Company will require significant additional capital in the short-term to fund its continuing operations,

satisfy existing and future obligations and liabilities, including the remaining payments due for the acquisition of the

ENTADFI® assets, payment due on the debenture, in addition to funds needed to support the Company’s working capital needs

and business activities.

These business activities include the commercialization of ENTADFI®, which we have temporarily paused

as discussed above, and Proclarix, and the development and commercialization of the Company’s current product candidates and

future product candidates.

In addition, as discussed more fully in Note 5, if stockholder approval is not obtained by January 1,

2025 with respect to the Series B Convertible Redeemable Preferred Stock issued in connection with the acquisition of Proteomedix,

these shares become redeemable for cash at the option of the holders, and the Company currently does not have sufficient cash to

redeem such shares.

Management’s plans

for funding the Company’s operations include generating product revenue from sales of Proclarix, which may still be subject to further

successful commercialization activities within certain jurisdictions, and ENTADFI, which is subject to further successful commercialization

activities which we have temporarily paused as discussed above.

Certain of the commercialization activities are outside of the Company’s

control, including but not limited to, securing contracts with wholesalers and third-party payers, securing contracts with third-party

logistics providers, and obtaining required licensure in various jurisdictions, as well as attempting to secure additional required funding

through equity or debt financings if available.

However, there are currently no commitments in place for further financing nor is there

Management’s plans for funding the Company’s

operations include generating product revenue from sales of Proclarix, which may still be subject to further successful commercialization

activities within certain jurisdictions.

Management also intends to secure additional required funding through equity or debt financings

if available, and to utilize the ELOC entered into in October 2024 (see Note 9) on an as-needed basis to assist with the paydown of notes

issued to Veru and to fund current operating needs, subject to certain restrictions and beneficial ownership constraints.

However, based

on the terms of the ELOC and the current maximum availability, management determined that the funds readily available under the ELOC will

not be sufficient to sustain operations.

In addition, there are currently no other commitments in place for further financing nor is there

any assurance that such financing will be available to the Company on favorable terms, if at all.

This creates significant uncertainty

that the Company will have the funds available to be able to successfully launch ENTADFI® and expand commercialization of Proclarix.

If the Company is unable to secure additional capital, it may be required to curtail any future clinical trials, development and/or commercialization

of products and product candidates, and it may take additional measures to reduce expenses in order to conserve its cash in amounts sufficient

whether the Company will have the funds available to be able to sustain its operations and expand commercialization of Proclarix.

Company is unable to secure additional capital, it may be required to curtail any future clinical trials, development, and/or commercialization

of future product candidates, and it may take additional measures to reduce expenses in order to conserve its cash in amounts sufficient

to sustain operations and meet its obligations.

Because of historical and

expected operating losses and net operating cash flow deficits, there is substantial doubt about the Company’s ability to continue

as a going concern for one year from the issuance of the consolidated financial statements, which is not alleviated by management’s

The consolidated financial statements have been prepared assuming the Company will continue as a going concern.

These consolidated

financial statements do not include any adjustments that might be necessary from the outcome of this uncertainty.

Because of historical and expected operating losses

and net operating cash flow deficits, there is substantial doubt about the Company’s ability to continue as a going concern for

one year from the issuance of the consolidated financial statements, which is not alleviated by management’s plans.

The consolidated

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

These consolidated financial statements

do not include any adjustments that might be necessary from the outcome of this uncertainty.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 3 — Summary of Significant Accounting Policies

Use of Estimates

The preparation of the consolidated

financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts

of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and

the reported amounts of revenue and expenses during the reporting periods.

The most significant estimates in the Company’s consolidated

financial statements relate to accounting for acquisitions, valuation of inventory, the useful life of the amortizable intangible assets,

estimates of future cash flows used to evaluate impairment of intangible assets, accrued research and development expenses, assumptions

related to the pension benefit obligation, stock-based compensation, the valuation of preferred stock, and the valuation allowance of

deferred tax assets.

These estimates and assumptions are based on current facts, historical experience and various other factors believed

to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets

and liabilities and the recording of expenses that are not readily apparent from other sources.

Actual results may differ materially and

adversely from these estimates.

To the extent there are material differences between the estimates and actual results, the Company’s

future results of operations will be affected.

The preparation of the consolidated financial

statements in conformity with U.S.

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

and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported

amounts of revenue and expenses during the reporting periods.

The most significant estimates in the Company’s consolidated financial

statements relate to accounting for acquisitions, valuation of inventory, the useful life of the amortizable intangible assets, estimates

of future cash flows used to evaluate impairment of intangible assets, accrued research and development expenses, assumptions related

to the pension benefit obligation, stock-based compensation, the valuation of preferred stock, valuation of subscription agreement liability,

and the valuation allowance of deferred tax assets.

These estimates and assumptions are based on current facts, historical experience

and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments

about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources.

results may differ materially and adversely from these estimates.

To the extent there are material differences between the estimates and

actual results, the Company’s future results of operations will be affected.

Concentration of Credit Risk

Financial instruments that

potentially subject the Company to concentrations of credit risk consist of cash accounts in financial institutions, which, at times,

exceed the Federal Depository Insurance Coverage limit for those maintained in the United States and exceed the Swiss Financial Market

Supervisory Authority for those maintained in Switzerland.

As of December 31, 2023 and 2022, the Company has not experienced losses on

these accounts and management believes the Company is not exposed to significant risks on such accounts.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 3 — Summary of Significant Accounting Policies (cont.)

Segment Information

Operating segments are defined

as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker

(“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance.

Prior to the acquisition

of ENTADFI® during the quarter ended June 30, 2023, the Company managed one distinct business segment, which was vaccine discovery

and development.

During the second quarter of 2023, as a result of the acquisition of ENTADFI®, for which the Company is working towards

commercial launch, the Company operated in two business segments:

research and development and commercial.

During the third quarter of

2023, the Company deprioritized its vaccine discovery and development programs, and accordingly, as of December 31, 2023, the Company

was operating in one segment:

Management’s determination of its operating segments is consistent with the financial

information regularly reviewed by the CODM for purposes of evaluating performance, allocating resources, setting incentive compensation

targets, and planning and forecasting for future periods.

The distribution of revenue by geographical area

was as follows:

United States

The distribution of long-lived assets by geographical

area, which includes property and equipment and the Company’s right of use asset, was as follows:

United States

Financial instruments that potentially subject

the Company to concentrations of credit risk consist of cash accounts in financial institutions, which, at times, exceed the Federal Depository

Insurance Coverage limit for those maintained in the United States and exceed the Swiss Financial Market Supervisory Authority for those

maintained in Switzerland.

As of December 31, 2024 and 2023, the Company has not experienced losses on these accounts and management believes

the Company is not exposed to significant risks on such accounts.

Foreign Currency Translation

The financial statements

of Proteomedix, the Company’s foreign subsidiary, are measured using the local currency, which is the Swiss Franc, as the functional

Assets and liabilities of this subsidiary are translated into U.S.

dollars at exchange rates as of the consolidated balance

Equity is translated at historical exchange rates.

The financial statements of Proteomedix, the Company’s

foreign subsidiary, are measured using the local currency, which is the Swiss Franc, as the functional currency.

Assets and liabilities

of this subsidiary are translated into U.S.

dollars at exchange rates as of the consolidated balance sheet date.

Equity is translated

at historical exchange rates.

Revenues and expenses are translated into U.S.

dollars at average rates

of exchange in effect during the period.

The resulting cumulative translation adjustments have been recorded as a separate component of

stockholders’ equity, as accumulated other comprehensive income or loss.

Foreign currency transaction gains and losses are included

in the results of operations, and were not significant for the years ended December 31, 2023, or 2022.

dollars at average rates of exchange in effect during the

The resulting cumulative translation adjustments have been recorded as a separate component of stockholders’ equity, as

accumulated other comprehensive income or loss.

Foreign currency transaction gains and losses are included in the results of operations.

For the years ended December 31, 2024 and 2023, foreign currency translation gain (loss) was approximately $( 5.3 ) million and $ 2.4 million.

Accounts receivable

Company performs periodic credit evaluations of its customers’ financial condition and extends credit to virtually all of its customers

performs periodic credit evaluations of its customers’ financial condition and extends credit to virtually all of its customers

on an uncollateralized basis.

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The Company provides

an allowance for doubtful accounts that is based upon a review of outstanding receivables, historical collection information, expected

future losses, and existing economic conditions.

As of December 31, 2023, there was no allowance for doubtful accounts.

an allowance for credit losses that is based upon a review of outstanding receivables, historical collection information, expected future

losses, and existing economic conditions.

As of December 31, 2024, there was no allowance for credit losses.

As of December 31,

2024, substantially all of the Company’s accounts receivable are due from a single customer.

Inventories consist of product

acquired in the ENTADFI and Proteomedix transactions.

Inventories are stated at the lower of cost or net realizable value, with cost determined

on a first-in, first-out basis, aside from inventories acquired in an asset acquisition or business combination, which are recorded at

The Company periodically reviews the composition of inventory in order to identify excess, obsolete, slow-moving or otherwise

non-saleable items taking into account anticipated future sales compared with quantities on hand, and the remaining shelf life of goods

If non-saleable items are observed and there are no alternate uses for the inventory, the Company records a write-down to net

realizable value in the period that the decline in value is first recognized.

The Company recorded an impairment of inventory in the amount

of approximately $ 1.2 million during the year ended December 31, 2023, as a result of the delay in launching ENTADFI and the Company’s

decision to pause related commercialization activities.

Inventories consist of product acquired in the

Proteomedix transaction.

Inventories are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out

basis, aside from inventories acquired in an asset acquisition or business combination, which are recorded at fair value.

periodically reviews the composition of inventory in order to identify excess, obsolete, slow-moving or otherwise non-saleable items taking

into account anticipated future sales compared with quantities on hand, and the remaining shelf life of goods on hand.

If non-saleable

items are observed and there are no alternative uses for the inventory, the Company records a write-down to net realizable value in the

period that the decline in value is first recognized.

Property and Equipment

Property and equipment consists

of laboratory equipment, computers, and office furniture and fixtures, all of which are recorded at cost.

Depreciation is recorded using

the straight-line method over the respective useful lives of the assets ranging from two to ten years .

Depreciation expense was approximately

$ 7,000 for each of the years ended December 31, 2023 and 2022 and is included in selling, general and administrative expenses in the accompanying

Property and equipment consists of laboratory

equipment, computers, and office furniture and fixtures, all of which are recorded at cost.

Depreciation is recorded using the straight-line

method over the respective useful lives of the assets ranging from two to ten years .

Depreciation expense was approximately $ 22,000 and

$ 7,000 for the years ended December 31, 2024 and 2023 and is included in selling, general and administrative expenses in the accompanying

consolidated statements of operations and comprehensive loss.

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Note 3 — Summary of Significant Accounting Policies (cont.)

The Company evaluates acquisitions to

first determine whether a set of assets acquired constitutes a business and should be accounted for as a business combination.

assets acquired are not a business, the transaction is accounted as an asset acquisition in accordance with Accounting Standards Codification

The Company evaluates acquisitions to first

determine whether a set of assets acquired constitutes a business and should be accounted for as a business combination.

If the assets

acquired are not a business, the transaction is accounted as an asset acquisition in accordance with Accounting Standards Codification

(“ASC”) 805-50, Asset Acquisitions (“ASC 805-50”), which requires the acquiring entity to recognize

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Goodwill and Other Intangible Assets

Goodwill represents

the excess of the cost of a business combination over the fair value of the net assets acquired.

Goodwill and intangible

assets deemed to have indefinite lives are not amortized but are subject to impairment tests on an annual basis, and whenever events

or changes in circumstances indicate that the carrying value may not be recoverable.

Goodwill is allocated to the reporting

unit from which it was created.

A reporting unit is an operating segment or sub-segment to which goodwill is assigned when initially

The Company tests indefinite lived intangible assets for impairment, on an annual basis in the fourth quarter, or more frequently

if an event occurs or circumstances indicate that the indefinite lived assets may be impaired.

The Company may perform a qualitative assessment

to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount.

Goodwill represents the excess of the cost

of a business combination over the fair value of the net assets acquired.

Goodwill and intangible assets deemed to have

indefinite lives are not amortized but are subject to impairment tests on an annual basis, and whenever events or changes in circumstances

indicate that the carrying value may not be recoverable.

Goodwill is allocated to the reporting unit from which it was

A reporting unit is an operating segment or sub-segment to which goodwill is assigned when initially recorded.

Company tests indefinite lived intangible assets for impairment, on an annual basis in the fourth quarter, or more frequently if an event

occurs or circumstances indicate that the indefinite lived assets may be impaired.

The Company may perform a qualitative assessment to

determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount.

If the Company

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To perform its quantitative test, the Company compares the fair value of the reporting unit to its carrying

If the fair value of the reporting unit exceeds the carrying value of its net assets, goodwill is

not impaired, and no further testing is required.

If the fair value of the reporting unit is less than the carrying value, the Company

measures the amount of impairment loss, if any, as the excess of the carrying value over the fair value of the reporting unit.

Company did not test its goodwill or indefinite lived assets for impairment during the year ended December 31, 2023, given that the acquisition date occurred after the annual testing date, and given

that there were no impairment indicators from

the date of acquisition through the end of the reporting period.

The Company has determined that no impairment of its goodwill or indefinite

lived intangible assets occurred as of December 31, 2023.

Intangible assets with finite

lives are reported at cost, less accumulated amortization, and are amortized over their estimated useful lives, starting when sales for

the related product begin.

Amortization is calculated using the straight-line method, and recorded within selling, general, and administrative

expenses, or cost of revenue, depending on the nature and use of the asset.

During the ordinary course

of business, the Company has entered into certain license and asset purchase agreements.

Potential milestone payments for development,

regulatory, and commercial milestones are recorded when the milestone is probable of achievement.

Upon a milestone being achieved, the

associated milestone payment is capitalized and amortized over the remaining useful life for approved products, or expensed as research

and development expense for milestones relating to products whose FDA approval has not yet been obtained.

If the fair value of the reporting unit exceeds the carrying value of its net assets, goodwill is not impaired, and no

further testing is required.

If the fair value of the reporting unit is less than the carrying value, the Company measures the amount

of impairment loss, if any, as the excess of the carrying value over the fair value of the reporting unit.

The Company did not test

its goodwill or indefinite lived assets for impairment during the year ended December 31, 2023, given that the acquisition date occurred

after the annual testing date and given that there were no impairment indicators from the date of acquisition through the end of the reporting

For the year ended December 31, 2024, the Company recorded losses on impairment of goodwill of approximately $ 32.3 million.

Intangible assets with finite lives are reported

at cost, less accumulated amortization, and are amortized over their estimated useful lives, starting when sales for the related product

Amortization is calculated using the straight-line method, and recorded within selling, general, and administrative expenses, or

cost of revenue, depending on the nature and use of the asset.

During the ordinary course of business, the Company

has entered into certain license and asset purchase agreements.

Potential milestone payments for development, regulatory, and commercial

milestones are recorded when the milestone is probable of achievement.

Upon a milestone being achieved, the associated milestone payment

is capitalized and amortized over the remaining useful life for approved products, or expensed as research and development expense for

milestones relating to products whose FDA approval has not yet been obtained.

Impairment of Long-Lived Assets

The Company reviews long-lived

assets, including intangible assets with finite useful lives, for impairment whenever events or changes in business circumstances indicate

that the carrying amount of the assets may not be fully recoverable (a “triggering event”).

Factors that the Company considers

in deciding when to perform an impairment review include significant underperformance of the long-lived asset in relation to expectations,

significant negative industry or economic trends, and significant changes or planned changes in the use of the assets.

If an impairment

review is performed to evaluate a long-lived asset for recoverability, the Company compares forecasts of undiscounted cash flows expected

to result from the use and eventual disposition of the long-lived asset to its carrying value.

An impairment loss would be recognized

when estimated undiscounted future cash flows expected to result from the use of an asset are less than its carrying amount.

The impairment

loss would be based on the excess of the carrying value of the impaired asset over its fair value.

During the fourth quarter of 2023,

The Company reviews long-lived assets, including

intangible assets with finite useful lives, for impairment whenever events or changes in business circumstances indicate that the carrying

amount of the assets may not be fully recoverable (a “triggering event”).

Factors that the Company considers in deciding when

to perform an impairment review include significant underperformance of the long-lived asset in relation to expectations, significant

negative industry or economic trends, and significant changes or planned changes in the use of the assets.

If an impairment review is

performed to evaluate a long-lived asset for recoverability, the Company compares forecasts of undiscounted cash flows expected to result

from the use and eventual disposition of the long-lived asset to its carrying value.

An impairment loss would be recognized when estimated

undiscounted future cash flows expected to result from the use of an asset are less than its carrying amount.

The impairment loss would

be based on the excess of the carrying value of the impaired asset over its fair value.

During the years ended December 31, 2024 and 2023,

the Company determined that there were certain triggering events that indicated that the carrying amount of the assets recorded in connection

with the ENTADFI acquisition (see Note 5) may not be fully recoverable.

A related impairment loss of $ 14.7 million was recorded during

the year ended December 31, 2023 (see Note 4).

The Company also recorded an impairment loss of approximately $ 267,000 during the year

ended December 31, 2023, related to implementation costs incurred under cloud computing hosting arrangements that were capitalized during

There were no other impairment losses on long-lived assets for the years ended December 31, 2023 and 2022.

Impairment losses of $ 3.5 million and $ 14.7 million were recorded

during the years ended December 31, 2024 and 2023, respectively (see Note 4).

The Company also recorded an impairment loss of approximately

$ 267,000 during the year ended December 31, 2023, related to implementation costs incurred under cloud computing hosting arrangements

that were capitalized during the year.

During the year ended December 31, 2024, the Company

determined there were certain triggering events that indicated the carrying amounts of the assets recorded in connection with the PMX

acquisition (see Note 5) may not be fully recoverable.

Impairment losses of approximately $ 10.3 million related to the Company’s

intangible assets were recorded during the year ended December 31, 2024 resulting in a zero balance of the intangible assets as of December

See Note 4 for further details.

ONCONETIX, INC.

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Fair Value Measurements

Fair value is defined as

the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants

at the measurement date.

GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level

1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

Fair value is defined as the price that would

be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement

GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

The hierarchy

gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and

the lowest priority to unobservable inputs (Level 3 measurements).

These tiers include:

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Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

In some circumstances, the

inputs used to measure fair value might be categorized within different levels of the fair value hierarchy.

In those instances, the fair

value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the

fair value measurement.

Financial instruments, including cash, inventory, accounts receivable, receivables from related party, accounts

payable, accrued liabilities, operating lease liabilities, and notes payable are carried at cost, which management believes approximates

fair value due to the short-term nature of these instruments.

The fair value of the contingent

warrant liability that became issuable upon the closing of the private placements the Company closed on during 2022, the warrant inducement

the Company closed on during 2023 (see Note 9), and the subscription agreement liability that was recorded in connection with a subscription

agreement (see Note 8) are valued using significant unobservable measures and other fair value inputs, and are therefore classified as

Level 3 financial instruments.

The fair value of financial instruments measured

on a recurring basis is as follows:

In some circumstances, the inputs used to measure

fair value might be categorized within different levels of the fair value hierarchy.

In those instances, the fair value measurement is

categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.

Financial instruments, including cash, inventory, accounts receivable, receivables from related party, accounts payable, accrued liabilities,

operating lease liabilities, and notes payable are carried at cost, which management believes approximates fair value due to the short-term

nature of these instruments.

The fair value of the contingent warrant liability

and the related party subscription agreement liability are valued using significant unobservable measures and other fair value inputs

and are therefore classified as Level 3 financial instruments.

The fair value of financial instruments measured on a recurring basis

is as follows as of December 31, 2024 and 2023:

As of December 31, 2024

Contingent warrant liability

Subscription agreement liability

Contingent warrant liabilities

Subscription agreement liability – related party

As of December 31, 2023

Contingent warrant liability

During the year ended December

31, 2023, in connection with the acquisition of Proteomedix, the Company recorded intangible assets, which were recognized at fair value

(see Note 5).

None of the Company’s other non-financial assets or liabilities are recorded at fair value on a non-recurring basis.

were no transfers between levels during the periods presented.

The following table summarizes

the activity for the subscription agreement liability, using unobservable Level 3 inputs, for the year ended December 31, 2023:

Subscription Agreement

Subscription agreement liability – related party

During the year ended December 31, 2023, in connection

with the acquisition of Proteomedix, the Company recorded intangible assets, which were recognized at fair value (see Note 5).

Additionally,

as a result of the impairment losses recorded on the Company’s ENTADFI asset group during the year ended December 31, 2024, the

related assets were recorded at fair value as of December 31, 2024.

These non-financial assets were valued using significant unobservable

measures and other fair value inputs and are therefore classified as Level 3 measurements.

None of the Company’s other non-financial

assets or liabilities are recorded at fair value on a non-recurring basis as of December 31, 2024 and 2023.

no transfers between levels during the periods presented.

The following table summarizes the activity for

the related party subscription agreement liability, using unobservable Level 3 inputs, for the years ended December 31, 2024 and 2023:

Balance at December 31, 2022

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Balance at December 31, 2023

Change in fair value

Balance at December 31, 2024

ONCONETIX, INC.

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Note 3 — Summary of Significant Accounting Policies (cont.)

The following table summarizes

the activity for the contingent warrant liability, using unobservable Level 3 inputs, for the years ended December 31, 2023 and 2022:

Valuation of Subscription Agreement Liability

The Subscription Agreement is accounted for as a liability in accordance

with ASC 480, Distinguishing Liabilities from Equity, (“ASC 480”), as the make-whole provision could result in a variable

number of shares being issued upon settlement.

The related party subscription agreement liability is measured at fair value at the commitment

date and at each subsequent reporting period, with changes in fair value recorded as a component of other income (expense), net in the

consolidated statements of operations and comprehensive loss.

As of December 31, 2024 and December 31, 2023, the fair value of the related

party subscription agreement liability is estimated to be approximately $ 4,123,000 and $ 864,000 , respectively, and the change in fair

value of the related party subscription agreement liability for the year ended December 31, 2024 was an increase of approximately $ 3,259,000 .

The fair value was determined using a Monte-Carlo option pricing model, and as of December 31, 2024 and 2023, the Company utilized 100 %

and 55 % probability, respectively, that the Subscription Agreement will close.

The following table summarizes the activity for

the contingent warrant liabilities, using unobservable Level 3 inputs, for the years ended December 31, 2024 and 2023:

Balance at December 31, 2022

Fair value at issuance

Reclassification to equity

Change in fair value

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Fair value at issuance

Reclassification to equity

Change in fair value

( 1,250,466 )

Gain on settlement of contingent warrant liability

Balance at December 31, 2024

Deferred Offering Costs

The Company capitalizes certain

legal, professional accounting and other third-party fees that are directly associated with in-process equity financing as deferred offering

costs until such financings are consummated.

After consummation of the equity financing, these costs are recorded in stockholders’

equity as a reduction of proceeds generated as a result of the offering.

Should the in-process equity financing be abandoned, the deferred

offering costs will be expensed immediately as a charge to expenses in the consolidated statements of operations and comprehensive loss.

The Company accounts for

leases in accordance with ASC 842, Leases .

The Company has one lease agreement for office space, which contains an initial term

of two years with renewal options.

The Company capitalizes certain legal, professional

accounting and other third-party fees that are directly associated with in-process equity financing as deferred offering costs until such

financings are consummated.

After consummation of the equity financing, these costs are recorded in stockholders’ equity as a reduction

of proceeds generated as a result of the offering.

Should the in-process equity financing be abandoned, the deferred offering costs will

be expensed immediately as a charge to expenses in the consolidated statements of operations and comprehensive loss.

The Company accounts for leases in accordance

with ASC 842, Leases .

The Company has one lease agreement for office space, which contains an initial term of two years with renewal

The Company determines if an arrangement is a lease at inception.

This determination generally depends

on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified asset for a period

of time in exchange for consideration.

Control of an underlying asset is conveyed to the Company if the Company obtains the rights to

direct the use of and to obtain substantially all of the economic benefits from using the underlying asset.

Operating lease right of

use assets and operating lease liabilities are recognized on the lease commencement date.

Operating lease right of use assets represent

the Company’s right to use an underlying asset for the estimated lease term and operating lease liabilities represent the Company’s

present value of its future lease payments.

In assessing its lease and determining its lease liability at lease commencement or upon modification,

the Company was not able to readily determine the rate implicit for its lessee arrangements, and thus has used its incremental borrowing

rate on a collateralized basis to determine the present value of the lease payments.

The Company’s right of use asset is measured

as the balance of the lease liability plus or minus any prepaid or accrued lease payments and any unamortized initial direct costs.

operating lease payments are recognized as lease expense on a straight-line basis over the lease term, and are included in selling, general

and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss.

Lease payments included

in the measurement of the lease liability are comprised of fixed payments.

If the Company’s lease agreements include renewal option

periods, the Company includes such renewal options in its calculation of the estimated lease term when it determines the options are reasonably

This determination generally depends on whether the arrangement

conveys to the Company the right to control the use of an explicitly or implicitly identified asset for a period of time in exchange for

consideration.

Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to

obtain substantially all of the economic benefits from using the underlying asset.

Operating lease right of use assets and operating

lease liabilities are recognized on the lease commencement date.

Operating lease right of use assets represent the Company’s right

to use an underlying asset for the estimated lease term and operating lease liabilities represent the Company’s present value of

its future lease payments.

In assessing its lease and determining its lease liability at lease commencement or upon modification, the

Company was not able to readily determine the rate implicit for its lessee arrangements and thus has used its incremental borrowing rate

on a collateralized basis to determine the present value of the lease payments.

The Company’s right of use asset is measured as

the balance of the lease liability plus or minus any prepaid or accrued lease payments and any unamortized initial direct costs.

The operating

lease payments are recognized as lease expense on a straight-line basis over the lease term, and are included in selling, general and

administrative expenses in the accompanying consolidated statements of operations and comprehensive loss.

Lease payments included in the

measurement of the lease liability are comprised of fixed payments.

If the Company’s lease agreements include renewal option periods,

the Company includes such renewal options in its calculation of the estimated lease term when it determines whether the options are reasonably

certain to be exercised.

When such renewal options are deemed to be reasonably certain, the estimated lease term determined under ASC

842 will be greater than the non-cancelable term of the contractual arrangement.

Leases with an initial term

of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a

straight-line basis over the lease term.

842 will be greater than the non-cancellable term of the contractual arrangement.

Leases with an initial term of 12 months or less

are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis

over the lease term.

The Company applies this policy to all underlying asset categories.

The Company additionally evaluates

leases at their inception to determine if the leases are to be accounted for as an operating lease or a finance lease.

Lease expense for

operating leases is recognized on a straight-line basis over the lease term.

Variable lease payments are recognized in the period in which

the obligations for those payments are incurred.

Lease expense for finance leases is bifurcated into two components, with the amortization

expense component of the right-of-use asset recognized on a straight-line basis and the interest expense component recognized using the

effective interest method over the lease term.

The Company additionally evaluates leases at their

inception to determine if the leases are to be accounted for as an operating lease or a finance lease.

Lease expense for operating leases

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

Variable lease payments are recognized in the period in which the obligations

for those payments are incurred.

Lease expense for finance leases is bifurcated into two components, with the amortization expense component

of the right-of-use asset recognized on a straight-line basis and the interest expense component recognized using the effective interest

method over the lease term.

The Company has no financing leases as of December 31, 2024 or 2023.

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Defined Benefit Pension Plan

sponsors a defined benefit pension plan (the “Swiss Plan”) covering its eligible Swiss employees.

Proteomedix sponsors

a defined benefit pension plan (the “Swiss Plan”) covering its eligible Swiss employees.

The Swiss Plan is government-mandated

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Those changes are reported in accumulated other comprehensive loss in the

accompanying consolidated statements of convertible redeemable preferred stock and stockholders’ equity.

The Company uses actuarial

valuations to determine its pension and postretirement benefit costs and credits.

accompanying consolidated statements of convertible preferred stock and stockholders’ equity.

The Company uses actuarial valuations

to determine its pension and postretirement benefit costs and credits.

The amounts calculated depend on a variety of key assumptions,

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Collaborative Agreements

The Company periodically

enters into strategic alliance agreements with counterparties to produce products and/or provide services to customers.

Alliances created

by such agreements are not legal entities, have no employees, no assets and have no true operations.

These arrangements create contractual

rights and the Company accounts for these alliances as a collaborative arrangement by reporting costs incurred and reimbursements received

from transactions within research and development expense within the consolidated statements of operations and comprehensive loss.

The Company periodically enters into strategic

alliance agreements with counterparties to produce products and/or provide services to customers.

Alliances created by such agreements

are not legal entities, have no employees, no assets and have no true operations.

These arrangements create contractual rights and the

Company accounts for these alliances as a collaborative arrangement by reporting costs incurred and reimbursements received from transactions

within research and development expenses within the consolidated statements of operations and comprehensive loss.

Revenue Recognition

the year ended December 31, 2023, the Company recorded approximately $ 59,000 of revenue, which was solely generated from Proteomedix development

services from the period from the acquisition date of December 15, 2023, through December 31, 2023.

Development Services

provides a range of services to life sciences customers referred to as “Development Services” including testing for biomarker

15 unchanged sentences

as revenue and billed to the customer are included in accounts receivable

Any revenues earned but not yet billed to the customer as of

the date of the consolidated financial statements are recorded as contract assets and are included in prepaids and other current assets

as of the financial statement date, and these amounts as of December 31, 2023 are not significant.

Amounts recorded in contract assets

are reclassified to accounts receivable in our consolidated financial statements when the customer is invoiced according to the billing

schedule in the contract.

Accounts receivable was approximately $ 87,000 and $ 150,000 as of December 15, 2023, the date of acquisition

of Proteomedix (see Note 5), and December 31, 2023, respectively.

ONCONETIX, INC.

1 unchanged sentence

Note 3 — Summary of Significant Accounting Policies (cont.)

In circumstances where a SOW includes a variable consideration

component, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either

the expected value method or the most likely amount method, depending on which method is expected to better predict the amount of consideration

to which the Company will be entitled.

The value of variable consideration is included in the transaction price if, and to the extent,

it is probable that a significant reversal of the amount of cumulative revenue recognized will not occur when the uncertainty associated

with the variable consideration is subsequently resolved.

These estimates are reassessed each reporting period, as required, and any

adjustment required is recorded on a cumulative catch-up basis, which would affect revenue and net loss in the period of adjustment.

Product Sales

The Company derives revenue through sales of its

products, which includes Proclarix, its diagnostic product, directly to end users, including laboratories, hospitals, and medical centers,

and to distributors.

As of the year ended December 31, 2024, the majority of the Company’s product revenue was generated from sales

of Proclarix assays to LabCorp for review and testing in connection with the Company’s license agreement with LabCorp (see Note

The Company considers customer purchase orders, which in some cases are governed by master sales agreements or standard terms and

conditions, to be the contracts with a customer.

For each contract, the Company considers the promise to transfer products, each of which

is distinct, to be the identified performance obligations.

In determining the transaction price, the Company evaluates whether the price

is subject to a refund or adjustment to determine the net consideration to which it expects to be entitled.

The Company fulfills its performance

obligation applicable to product sales once the product is transferred to the customer.

The Company’s revenue was generated from

the following geographic regions during the year ended December 31, 2024:

Development services

Product sales

Total Revenue

Development services

Product sales

The Company’s revenue was generated from

the following geographic regions during the year ended December 31, 2023:

Development services

Product sales

Total Revenue

Development services

The Company had the following customer concentrations

for its revenue during the years ended December 31, 2024 and 2023:

the Year Ended

December 31, 2024

the Year Ended

December 31, 2023

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 3 — Summary of Significant Accounting Policies (cont.)

Any revenues earned but not yet billed to the

customer as of the date of the consolidated financial statements are recorded as contract assets and are included in prepaid expenses

and other current assets in the accompanying consolidated financial statements.

The Company had no unbilled accounts receivable as of

December 31, 2024 and an insignificant balance as of December 31, 2023.

Amounts recorded in contract assets are reclassified to accounts

receivable in our consolidated financial statements when the customer is invoiced according to the billing schedule in the contract.

receivable was approximately $ 26,000 and $ 150,000 as of December 31, 2024 and December 31, 2023, respectively.

In relation to customer contracts, the Company

incurs costs to fulfill a contract but does not incur costs to obtain a contract.

These costs to fulfill a contract do not meet the criteria

for capitalization and are expensed as incurred.

In circumstances where a SOW includes a variable

consideration component, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing

either the expected value method or the most likely amount method, depending on which method is expected to better predict the amount

of consideration to which the Company will be entitled.

The value of variable consideration is included in the transaction price if, and

to the extent, it is probable that a significant reversal of the amount of cumulative revenue recognized will not occur when the uncertainty

associated with the variable consideration is subsequently resolved.

These estimates are reassessed each reporting period, as required,

and any adjustment required is recorded on a cumulative catch-up basis, which would affect revenue and net loss in the period of adjustment.

Research and Development

The Company expenses the

cost of research and development as incurred.

Research and development expenses include costs incurred in funding research and development

activities, license fees, and other external costs.

Advance payments for goods and services that will be used in future research and development

activities are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.

Upfront and milestone payments due to third parties that perform research and development services on the Company’s behalf will

be expensed as services are rendered or when the milestone is achieved.

When billing terms under research and development contracts do

not coincide with the timing of when the work is performed, the Company is required to make estimates of outstanding obligations as of

period end to those third parties.

Accrual estimates are based on several factors, including the Company’s knowledge of the progress

towards completion of the research and development activities, invoicing to date under the contracts, communication from the research

institution or other companies of any actual costs incurred during the period that have not yet been invoiced, and the costs included

in the contracts.

Significant judgments and estimates may be made in determining the accrued balances at the end of any reporting period.

Actual results could differ from the estimates made by the Company.

The historical accrual estimates made by the Company have not been

materially different from the actual costs (see Note 6).

In accordance with the Financial

Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 730-10-25-1, Research and

Development, costs incurred in obtaining licenses and patent rights are charged to research and development expense if the technology

licensed has not reached commercial feasibility and has no alternative future use.

The licenses purchased by the Company (see Note 6)

require substantial completion of research and development, regulatory and marketing approval efforts to reach commercial feasibility

and have no alternative future use.

Accordingly, the total purchase price for the licenses acquired is reflected as research and development

on the Company’s consolidated statements of operations and comprehensive loss.

The Company expenses the cost of research and

development as incurred.

Research and development expenses include costs incurred in funding research and development activities, license

fees, and other external costs.

Advance payments for goods and services that will be used in future research and development activities

are expensed when the activity has been performed or when the goods have been received rather than when the payment is made.

milestone payments due to third parties that perform research and development services on the Company’s behalf will be expensed

as services are rendered or when the milestone is achieved.

When billing terms under research and development contracts do not coincide

with the timing of when the work is performed, the Company is required to make estimates of outstanding obligations as of period end to

those third parties.

Accrual estimates are based on several factors, including the Company’s knowledge of the progress towards completion

of the research and development activities, invoicing to date under the contracts, communication from the research institution or other

companies of any actual costs incurred during the period that have not yet been invoiced, and the costs included in the contracts.

judgments and estimates may be made in determining the accrued balances at the end of any reporting period.

Actual results could differ

from the estimates made by the Company.

The historical accrual estimates made by the Company have not been materially different from the

actual costs (see Note 6).

In accordance with the Financial Accounting Standards

Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 730-10-25-1, Research and Development, costs

incurred in obtaining licenses and patent rights are charged to research and development expense if the technology licensed has not reached

commercial feasibility and has no alternative future use.

The licenses purchased by the Company (see Note 6) require substantial completion

of research and development, regulatory and marketing approval efforts to reach commercial feasibility and have no alternative future

Accordingly, the total purchase price for the licenses acquired is reflected as research and development on the Company’s consolidated

statements of operations and comprehensive loss.

Contingencies

Accruals are recorded for

loss contingencies when it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated.

The Company evaluates, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease

in the amount of the liability that has been accrued previously.

Considering facts known at the time of the assessment, the Company determines

whether potential losses are considered reasonably possible or probable and whether they are estimable.

Based upon this assessment, the

Company carries out an evaluation of disclosure requirements and considers possible accruals in the consolidated financial statements.

Accruals are recorded for loss contingencies when

it is probable that a liability has been incurred, and the amount of the related loss can be reasonably estimated.

The Company evaluates,

on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the

liability that has been accrued previously.

Considering facts known at the time of the assessment, the Company determines whether potential

losses are considered reasonably possible or probable and whether they are estimable.

Based upon this assessment, the Company carries

out an evaluation of disclosure requirements and considers possible accruals in the consolidated financial statements.

Stock-Based Compensation

The Company expenses stock-based

compensation to employees and non-employees over the requisite service period based on the estimated grant-date fair value of the awards.

Stock-based awards to employees with graded-vesting schedules are recognized, using the accelerated attribution method, on a straight-line

basis over the requisite service period for each separately vesting portion of the award.

The Company expenses stock-based compensation

to employees and non-employees over the requisite service period based on the estimated grant-date fair value of the awards.

awards to employees with graded-vesting schedules are recognized, using the accelerated attribution method, on a straight-line basis over

the requisite service period for each separately vesting portion of the award.

ONCONETIX, INC.

1 unchanged sentence

Note 3 — Summary of Significant Accounting Policies (cont.)

The Company estimates the

fair value of stock option grants using the Black-Scholes option pricing model and the assumptions used in calculating the fair value

of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s

The Company estimates the fair value of stock

option grants using the Black-Scholes option pricing model and the assumptions used in calculating the fair value of stock-based awards

represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment.

Expected Term — The expected

21 unchanged sentences

future, and, therefore, uses an expected dividend yield of zero in its valuation models.

The Company recognizes forfeitures of equity awards

as they occur.

Income taxes are accounted

for under the asset and liability method.

Deferred tax assets and liabilities are recognized for future tax consequences attributable

to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and

operating loss and tax credit carryforwards.

Deferred tax assets and

liabilities are measured using enacted tax rates expected to apply to taxable income in the jurisdictions and years in which those

temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax

rate is recognized in operations in the period that includes the enactment date.

Deferred tax assets are reduced to estimated

amounts expected to be realized by the use of a valuation allowance.

The Company recognizes forfeitures

of equity awards as they occur.

Income taxes are accounted for under the asset

and liability method.

Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between

the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax

credit carryforwards.

Deferred tax assets and liabilities are measured

using enacted tax rates expected to apply to taxable income in the jurisdictions and years in which those temporary differences are expected

to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rate is recognized in operations in the

period that includes the enactment date.

Deferred tax assets are reduced to estimated amounts expected to be realized by the use of a

valuation allowance.

Comprehensive Loss

The Company is required to

report all components of comprehensive loss, including net loss, in the accompanying consolidated financial statements in the period in

which they are recognized.

Comprehensive loss is defined as the change in equity during a period from transactions and other events and

circumstances from non-owner sources.

The Company’s comprehensive loss for the year ended December 31, 2023 is comprised of net

loss, the effect of currency translation adjustments, and the change in pension benefit obligation.

Net loss and comprehensive loss were

the same for the year ended December 31, 2022.

The Company is required to report all components

of comprehensive loss, including net loss, in the accompanying consolidated financial statements in the period in which they are recognized.

Comprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner

The Company’s comprehensive losses for the years ended December 31, 2024 and 2023 are comprised of net loss, the effect

of currency translation adjustments, and the change in pension benefit obligation.

ONCONETIX, INC.

2 unchanged sentences

Financial instruments

The Company determines the

accounting classification of financial instruments that are issued, including its warrants and a subscription agreement, as either liability

or equity, by first assessing whether the financial instruments are freestanding financial instruments, and if they meet liability classification

in accordance with ASC 480, Distinguishing Liabilities from Equity , (“ASC 480”), and then in accordance with ASC 815-40,

Derivatives and Hedging – Contracts in Entity’s Own Equity (“ASC 815-40”).

Under ASC 480-10, financial

instruments are considered liability-classified if the instruments are mandatorily redeemable, obligate the issuer to settle the instruments

or the underlying shares by paying cash or other assets, or must or may require settlement by issuing a variable number of shares.

If the instruments do not

meet liability classification under ASC 480, the Company assesses the requirements under ASC 815-40, which states that contracts that

require or may require the issuer to settle the contract for cash are liabilities recorded at fair value, irrespective of the likelihood

of the transaction occurring that triggers the net cash settlement feature.

If the financial instruments do not require liability classification

under ASC 815-40, in order to conclude equity classification, the Company assesses whether the instruments are indexed to the Company’s

common stock and whether the instruments are classified as equity under ASC 815-40 or other applicable GAAP.

After all relevant assessments

are made, the Company concludes whether the instruments are classified as liability or equity.

Liability-classified instruments are required

to be accounted for at fair value both on the date of issuance and on subsequent accounting period ending dates, with all changes in fair

value after the issuance date recorded as a component of other income (expense), net in the consolidated statements of operations and

comprehensive loss.

Equity-classified instruments are accounted for at fair value on the issuance date with no changes in fair value recognized

after the issuance date.

The Company determines the accounting classification

of financial instruments that are issued, including its warrants and a subscription agreement, as either liability or equity, by first

assessing whether the financial instruments are freestanding financial instruments, and if they meet liability classification in accordance

with ASC 480, Distinguishing Liabilities from Equity , (“ASC 480”), and then in accordance with ASC 815-40, Derivatives

and Hedging – Contracts in Entity’s Own Equity (“ASC 815-40”).

Under ASC 480-10, financial instruments are

considered liability-classified if the instruments are mandatorily redeemable, obligate the issuer to settle the instruments or the underlying

shares by paying cash or other assets, or must or may require settlement by issuing a variable number of shares.

If the instruments do not meet liability classification

under ASC 480, the Company assesses the requirements under ASC 815-40, which states that contracts that require or may require the issuer

to settle the contract for cash are liabilities recorded at fair value, irrespective of the likelihood of the transaction occurring that

triggers the net cash settlement feature.

If the financial instruments do not require liability classification under ASC 815-40, in order

to conclude equity classification, the Company assesses whether the instruments are indexed to the Company’s common stock and whether

the instruments are classified as equity under ASC 815-40 or other applicable GAAP.

After all relevant assessments are made, the Company

concludes whether the instruments are classified as liability or equity.

Liability-classified instruments are required to be accounted

for at fair value both on the date of issuance and on subsequent accounting period ending dates, with all changes in fair value after

the issuance date recorded as a component of other income (expense), net in the consolidated statements of operations and comprehensive

Equity-classified instruments are accounted for at fair value on the issuance date with no changes in fair value recognized after

the issuance date.

Preferred Stock

The Company applies the guidance enumerated in ASC 480, when determining

the classification and measurement of preferred stock.

Preferred stock subject to mandatory redemption, if any, is classified as a liability

and is measured at fair value.

The Company classifies conditionally redeemable preferred stock, which includes preferred stock that features

redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not

solely within the Company’s control, as temporary equity.

At all other times, the Company classifies its preferred stock in

stockholders’ equity.

The Company applies the guidance enumerated in

ASC 480, when determining the classification and measurement of preferred stock.

Preferred stock subject to mandatory redemption, if any,

is classified as a liability and is measured at fair value.

The Company classifies conditionally redeemable preferred stock, which includes

preferred stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence

of uncertain events not solely within the Company’s control, as temporary equity.

At all other times, the Company classifies

its preferred stock in stockholders’ equity.

Treasury Stock

The Company records treasury stock activities

under the cost method whereby the cost of the acquired stock is recorded as treasury stock.

Net Loss Per Share

Basic loss per share is computed

by dividing the net loss applicable to common shares by the weighted average number of common shares outstanding during the period.

weighted average number of shares of common stock outstanding includes (i) pre-funded warrants because their exercise requires only

nominal consideration for delivery of shares and (ii) the shares held in abeyance because there is no consideration required for delivery

of the shares;

it does not include any potentially dilutive securities or any unvested restricted stock of common stock.

restricted shares, although classified as issued and outstanding at December 31, 2023 are considered contingently returnable until the

restrictions lapse and will not be included in the basic net loss per share calculation until the shares are vested.

Unvested shares of

the Company’s restricted stock do not contain non-forfeitable rights to dividends and dividend equivalents.

Diluted earnings

per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during

Potential common shares consist of the Company’s Series A preferred stock, warrants, unvested restricted stock, and

stock options.

Diluted loss per share excludes the shares issuable upon the conversion of Series A preferred stock, as well as unvested

restricted stock, common stock options and warrants, from the calculation of net loss per share if their effect would be anti-dilutive.

The Company records treasury stock activities under the cost method

whereby the cost of the acquired stock is recorded as treasury stock.

ONCONETIX, INC.

1 unchanged sentence

Note 3 — Summary of Significant Accounting Policies (cont.)

The two-class method is used

to determine earnings per share based on participation rights of participating securities in any undistributed earnings.

Each preferred

stock that includes rights to participate in distributed earnings is considered a participating security and the Company uses the two-class

method to calculate net income available to the Company’s common stockholders per common share — basic and diluted.

The following securities

were excluded from the computation of diluted shares outstanding for the periods presented, as they would have had an anti-dilutive impact

on the Company’s net loss:

Stock options

Unvested restricted stock

Common stock issuable upon conversion of Series A preferred stock

New Accounting Pronouncement s

In November 2023, the FASB

issued ASU No.

Recently Adopted Accounting Standards

Effective with the 2024 consolidated financial

statements, the Company adopted Accounting Standards Update (ASU) No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures .

This ASU updates reportable

segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the

Chief Operating Decision Maker (“CODM”) and included within each reported measure of a segment’s profit or loss.

ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses

the reported measures of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources.

ASU is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December

Adoption of the ASU should be applied retrospectively to all prior periods presented in the financial statements.

Early adoption

is permitted.

The Company is currently evaluating the impact that this guidance will have on its consolidated financial statements.

In December 2023, the FASB

issued ASU No.

Improvements to Reportable

Segment Disclosures , which requires disclosure of significant segment expenses and other segment items on an annual and interim basis.

The standard expanded disclosures that are required on an interim basis.

Additionally, it requires a public entity to disclose the title

and position of the Chief Operating Decision Maker (“CODM”).

The ASU does not change how a public entity identifies its operating

segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments.

The adoption of this standard

only impacted the Company’s disclosures, which were made on a retrospective basis, with no impact to the results of operations,

cash flows or financial condition.

Recent Accounting Pronouncement s Not Yet Adopted

In December 2023, the FASB issued ASU No.

Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures .

This ASU requires disclosure of specific

categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold.

The amendment

also includes other changes to improve the effectiveness of income tax disclosures, including further disaggregation of income taxes paid

for individually significant jurisdictions.

This ASU requires disclosure of specific categories in the rate

reconciliation and additional information for reconciling items that meet a quantitative threshold.

The amendment also includes other

changes to improve the effectiveness of income tax disclosures, including further disaggregation of income taxes paid for individually

significant jurisdictions.

This ASU is effective for annual periods beginning after December 15, 2024.

Adoption of this

ASU should be applied on a prospective basis.

Adoption of this ASU should be

applied on a prospective basis.

Early adoption is permitted.

The Company is currently evaluating the impact that this guidance

will have on its 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 consolidated financial statements.

The Company is currently evaluating the impact that this guidance will have

on its consolidated financial statements.

In November 2024, the FASB issued ASU No.

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 our 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 consolidated financial statements.

Note 4 — Balance Sheet Details

Inventories primarily relate

to ENTADFI® product and consisted of the following as of December 31, 2023 and 2022:

Inventories, which primarily relate to Proclarix

product as of December 31, 2024 and ENTADFI product as of December 31, 2023, consisted of the following:

Raw materials

1 unchanged sentence

Finished goods

The Company recorded an impairment on the ENTADFI

inventory in the amount of approximately $ 0.4 million during the year ended December 31, 2024.

During the year ended December 31, 2023,

$ 1.2 million of an impairment was recorded (see Note 5).

ONCONETIX, INC.

2 unchanged sentences

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted

of the following as of December 31, 2023 and 2022:

Prepaid expenses and other current assets consisted of the following

as of December 31, 2024 and 2023:

Prepaid insurance

2 unchanged sentences

Prepaid professional fees

VAT taxes receivable

Prepaid other

Other Receivable

Intangible Assets

Intangible assets, which

were recorded during the year ended December 31, 2023 in connection with the ENTADFI and Proteomedix acquisitions (see Note 5), is comprised

of customer relationships, product rights for developed technology, and a trade name, and consisted of the following as of December 31,

Product rights for developed technology

Intangible assets, which were recorded during

the year ended December 31, 2023 in connection with the ENTADFI and Proteomedix acquisitions (see Note 5), is comprised of customer relationships,

product rights for developed technology and a trade name, and consisted of the following as of December 31, 2024 and 2023:

Product rights

for developed

relationships

Total intangible

Balance at January 1, 2023

( 14,610,128 )

Customer relationships

( 14,610,128 )

Accumulated amortization:

Product rights for developed technology

Customer relationships

Intangible assets, net

The finite lived intangible

assets held by the Company, which includes customer relationships and product rights for developed technology, are being amortized over

their estimated useful lives, which is 15 years for customer relationships, and 15 and 6 years for product rights for developed technology

related to Proclarix and ENTADFI, respectively.

Amortization expense related to intangible assets was approximately $ 37,000 for the year

Effect of Foreign Currency Translation

Balance at December 31, 2023

Measurement period adjustments related to the Proteomedix acquisition (Note 5)

( 6,239,000 )

( 3,264,000 )

( 10,321,000 )

( 2,676,441 )

( 9,912,392 )

( 13,576,440 )

Effect of Foreign Currency Translation

Balance at December 31, 2024

The finite lived intangible assets held by the

Company, which includes trade name, customer relationships and product rights for developed technology, were being amortized over their

estimated useful lives, which is 15 years.

Amortization expense related to intangible assets was approximately $ 0.7 million for the year

ended December 31, 2024, of which approximately $ 457,000 and $ 252,000 was recorded as cost of revenue and selling, general, and administrative

expenses, respectively, in the accompanying consolidated statements of operations and comprehensive loss.

During the fourth quarter

of 2023, the Company determined that there were certain triggering events that indicated that the carrying amount of the assets recorded

in connection with the ENTADFI acquisition (see Note 5) may not be fully recoverable.

Specifically, as a result of the Proteomedix acquisition

(see Note 5) and continued significant cash constraints, the Company decided to pause the commercialization of ENTADFI until a later date,

and consider strategic alternatives, which combined, decreased the cash flows expected to be generated from these assets.

performed an undiscounted cash flow analysis over the ENTADFI asset group and determined that the carrying value of the asset group is

not recoverable.

The Company then estimated the fair value of the asset group to measure the impairment loss.

Significant assumptions

used to determine this non-recurring fair value measurement include projected sales driven by market share and product sales price estimates,

associated expenses, growth rates, the discount rate used to measure the fair value of the net cash flows associated with this asset group,

as well as Management’s estimates of the probability of each potential strategic alternative taking place.

The Company recorded

an impairment charge of $ 14.7 million during the year ended December 31, 2023, which was allocated on a pro rata basis across the assets

within the asset group as follows:

approximately $ 14.6 million and approximately $ 0.1 million was allocated to the product rights intangible

asset and other assets, respectively.

After recording this impairment charge, the long-lived assets in the ENTADFI asset group have a

remaining carrying amount of approximately $ 3.3 million as of December 31, 2023.

In addition, the Company also recorded an impairment

charge on acquired ENTADFI inventory, see Note 3.

Amortization expense related

to intangible assets was approximately $ 37,000 for the year ended December 31, 2023, of which approximately $ 31,000 and $ 6,000 was recorded

as costs of revenue and selling, general, and administrative expenses, respectively.

ONCONETIX, INC.

1 unchanged sentence

Note 4 — Balance Sheet Details (cont.)

Future annual amortization

expense related to the Company’s finite lived intangible assets is as follows as of December 31, 2023:

Years ending December 31,

As of December 31, 2023,

the weighted-average remaining amortization period for intangible assets was approximately 13.5 years.

Trade names, which do not

have legal, regulatory, contractual, competitive, economic, or other factors that limit the useful lives are considered indefinite lived

assets and are not amortized but are tested for impairment on an annual basis or whenever events or changes in circumstances indicate

that the carrying amount of these assets may not be recoverable.

As of December 31, 2023, $ 9.3 million of intangible assets relate to

a trade name that has been identified as having an indefinite life.

Goodwill was recorded during

the year ended December 31, 2023, in connection with the Proteomedix acquisition (see Note 5), and consisted of the following as of December

Balance as of December 31, 2022

ENTADFI Intangible Asset Impairment

During the three months ended March 31, 2024,

the Company became aware of a new competitor that received approval by the FDA for a combined finasteride-tadalafil capsule, which is

a direct competitor product to ENTADFI.

This was determined to be a triggering event that could result in a decrease in future expected

cash flows, and thus indicated the carrying amount of the ENTADFI asset group may not be fully recoverable.

The Company performed an

undiscounted cash flow analysis over the ENTADFI asset group and determined that the carrying value of the asset group is not recoverable.

The Company then estimated the fair value of the asset group to measure the impairment loss for the period.

Significant assumptions used

to determine this non-recurring fair value measurement included projected sales driven by market share and product sales price estimates,

associated expenses, growth rates, the discount rate used to measure the fair value of the net cash flows associated with this asset

group, as well as Management’s estimates of an expected sales price for the asset group, and the probability of each potential

strategic alternative taking place.

During the three months ended June 30, 2024, the

Company reevaluated the probability of each potential strategic alternative occurring and determined that the change in probabilities

is a triggering event that could result in a decrease in future expected cash flows.

Based on the Company’s evaluation, there was

no plan to resume commercialization of ENTADFI, the Company had not identified any buyers interested to consummate a sale or other transaction

of the ENTADFI assets and was considering abandoning the product, all of which indicated the carrying amount of the ENTADFI asset group

may not be fully recoverable.

The Company further determined that the asset group was fully impaired at June 30, 2024, and recorded a

corresponding impairment charge during the three months ended June 30, 2024, thus resulting in no remaining carrying value for the assets

in the ENTADFI asset group.

The Company further determined that the asset group was fully impaired at June 30, 2024, and recorded a corresponding

impairment charge during the three months ended June 30, 2024, thus resulting in no remaining carrying value for the assets in the ENTADFI

There were no additional impairments for the remainder of the year ending December 31, 2024.

Proteomedix Intangible Assets Impairment

The Company assesses the recoverability of its

intangible with definite lives whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

During the three months ended March 31, 2024, June 30, 2024 and September 30, 2024, the Company did identify certain impairment indicators

such as the decrease in the Company’s stock price;

however, the Company concluded the intangible assets’ values were recoverable

based on its quantitative analyses to assess the projected future undiscounted cash flows associated with the intangible assets compared

to their carrying value.

Therefore, the Company recorded no impairment charges on its intangible assets during the three months

ended March 31, 2024, June 30, 2024 and September 30, 2024.

During the three months ended December 31, 2024,

the Company identified indicators of impairment related to the intangible assets acquired in connection with the PMX acquisition.

the Company continued to view the underlying technologies as strategically important, it determined that it no longer possessed the operational

or financial resources required to advance their development.

This conclusion was based on several factors including the Company experiencing

a substantial decline in market capitalization and share price during the three months ended December 31, 2024.

The decrease in market

capitalization and share price was driven by significant recurring net losses and a decrease in the Company’s liquidity position.

The Company’s updated financial forecasts reflected continued and increasing net losses associated with the development and commercialization

of the PMX-related assets;

however, the Company’s weakened financial condition constrained its ability to raise the capital necessary

to support the continued investment in the PMX assets.

This limited access to capital raise led the Company to conclude it no longer has

the ability to support the continued operation and commercialization efforts associated with the PMX assets.

As a result of these factors,

the Company recorded a full impairment charge on the remaining balance of its intangible assets resulting in a zero balance at December

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 4 — Balance Sheet Details (cont.)

During the three months ended March 31, 2024,

the Company’s stock price and market capitalization declined, and the Company determined that this was an indicator of a potential

impairment of its goodwill, and accordingly, as of March 31, 2024, the Company performed a quantitative analysis to identify and

measure the amount of impairment loss to be recognized, if any.

To perform its quantitative test, the Company compared the fair value

of the Proteomedix reporting unit to its carrying value and determined that the fair value of the reporting unit was less than its carrying

The Company determined the amount of impairment charges to its goodwill for the three months ended March 31, 2024 to be approximately

$ 5.2 million.

Historically, the Company was organized in two

reporting units, Proteomedix and ENTADFI.

The goodwill arising from the Proteomedix acquisition was assigned solely to the Proteomedix

reporting unit.

The Company reevaluated its reporting units during the three months ended June 30, 2024, and determined that as of April

30, 2024, ENTADFI no longer qualified as a separate reporting unit.

As a result, since that date, the Company’s goodwill is assigned

to a single reporting unit.

Accordingly, the Company performed a quantitative analysis immediately prior to the change in reporting units,

and immediately after the change in reporting units, to identify and measure the amount of impairment loss to be recognized, if any.

To perform its quantitative tests, the Company compared the fair value of the reporting unit to its carrying value and determined that

the fair value of the reporting unit was less than its carrying value.

The Company determined the amount of impairment charges to its

goodwill for the three months ended June 30, 2024 to be approximately $ 10.3 million.

During the three months ended September 30, 2024,

the Company’s re-evaluation of market conditions and anticipated timing of projected sales prompted the Company to determine that

there was an indicator of a potential impairment of its related intangible assets and goodwill, and accordingly, as of September 30, 2024,

the Company performed a quantitative analysis to identify and measure the amount of impairment loss to be recognized, if any.

It was determined

no further impairment on goodwill was required for the three months ended September 30, 2024.

During the three months ended December 31, 2024,

the Company identified a measurement period adjustment relating from the Proteomedix acquisition resulting in an increase to the acquired

goodwill of approximately $ 8.4 million (see Note 5).

In addition, the Company performed a re-evaluation of market conditions and anticipated

timing of projected sales which prompted the Company to determine that there was an indicator of a potential impairment of its related

Accordingly, as of December 31, 2024, the Company performed a quantitative analysis to identify and measure the amount of impairment

loss to be recognized.

It was determined there was an additional impairment on goodwill of $ 16.8 million for the three months ended December

The Company has recorded a cumulative $ 32.3 million

in impairment charges related to its goodwill for the year ended December 31, 2024.

The fair value estimate of the reporting units

for the quarters ended March 31, 2024 and June 30, 2024 was derived from a combination of an income approach and a market approach, and

a reconciliation to the Company’s market capitalization.

The fair value estimate of the reporting units for the quarter ended September

30, 2024 was derived from the income approach and reconciled to the Company’s market capitalization.

The method was changed for

the quarter ended September 30, 2024 to reflect the disparity between the Company and the guideline transactions that were previously

selected in prior quarters.

The fair value estimate of the reporting units for the quarter ended December 31, 2024 was derived from the

Company’s market capitalization.

Under the income approach, the Company estimated the fair value of the reporting unit based on

the present value of estimated future cash flows, which the Company considers to be a Level 3 unobservable input in the fair value hierarchy.

The Company prepared cash flow projections based on management’s estimates of future revenue and operating costs, taking into consideration

the historical performance and the current macroeconomic, industry, and market conditions.

The Company based the discount rate on the

weighted-average cost of capital considering Company-specific characteristics and changes in the reporting unit’s projected cash

Under the market approach, the Company estimated the fair value of the reporting unit based on revenue market multiples derived

from comparable companies with similar characteristics as the reporting unit, as well as an estimated control premium.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 4 — Balance Sheet Details (cont.)

Goodwill consisted of the following as of December

31, 2024 and 2023:

Balance as of January 1, 2023

PMX transaction goodwill

Effect of currency translation

Foreign currency translation

Balance as of December 31, 2023

Measurement period adjustment related to the Proteomedix acquisition

Impairment loss

( 32,347,000 )

Foreign currency translation

( 4,674,012 )

Balance as of December 31, 2024

Accrued Expenses

Accrued expenses consisted of the following as

of December 31, 2023 and 2022:

Accrued research and development

Accrued expenses consisted of the following as of December 31,

2024 and 2023:

Accrued compensation

Accrued deferred offering costs

Accrued research and development

Accrued professional fees

Accrued implementation fees

Other accrued expenses

Accrued franchise taxes

Accrued interest

Accrued deferred offering costs

Accrued license fees

Other accrued expenses

Note 5 — Acquisitions

On April 19, 2023, the

Company and Veru, Inc.

On April 19, 2023, the Company and Veru,

(“Veru”) entered into an Asset Purchase Agreement (the “Veru APA”).

Pursuant to, and subject

to the terms and conditions of, the Veru APA, the Company purchased substantially all of the assets related to Veru’s ENTADFI® product

(“ENTADFI®”) (the “Transaction”) for a total possible consideration of $ 100 million.

In accordance with the Veru

APA, the Company agreed to provide Veru with initial consideration totaling $ 20.0 million, consisting of (i) $6.0 million paid upon the

closing of the Transaction on April 19, 2023, (ii) an additional $4.0 million in the form of a non-interest bearing note payable due on

September 30, 2023, and (iii) an additional $10.0 million in the form of two $5.0 million non-interest bearing notes payable, each due

on April 19, 2024 and September 30, 2024.

Pursuant to, and subject to the terms

and conditions of, the Veru APA, the Company purchased substantially all of the assets related to Veru’s ENTADFI product (“ENTADFI”)

(the “Transaction”) for a total possible consideration of $ 100 million.

In accordance with the Veru APA, the Company agreed

to provide Veru with initial consideration totaling $ 20.0 million, consisting of (i) $ 6.0 million paid upon the closing of the Transaction

on April 19, 2023, (ii) an additional $ 4.0 million in the form of a non-interest bearing note payable due on September 30, 2023, and (iii)

an additional $ 10.0 million in the form of two $ 5.0 million non-interest bearing notes payable, each due on April 19, 2024 and September

ONCONETIX, INC.

1 unchanged sentence

Note 5 — Acquisitions (cont.)

Additionally, the terms of

the Veru APA require the Company to pay Veru up to an additional $ 80.0 million based on the Company’s net sales of ENTADFI® after

closing (the “Milestone Payments”).

Additionally, the terms of the Veru APA require

the Company to pay Veru up to an additional $ 80.0 million based on the Company’s net sales of ENTADFI after closing (the “Milestone

The Milestone Payments are payable as follows:

(i) $10.0 million is payable upon

the first time the Company achieves net sales from ENTADFI® of $100.0 million during a calendar year, (ii) $20.0 million is payable

upon the first time the Company achieves net sales from ENTADFI® of $200.0 million during a calendar year, and (3) $50.0 million is

payable upon the first time the Company achieves net sales from ENTADFI® of $500.0 million during a calendar year.

In connection with the Transaction,

the Company also assumed royalty and milestone obligations under an asset purchase agreement for tadalafil-finasteride combination

entered into by Veru and Camargo Pharmaceutical Services, LLC on December 11, 2017 (the “Camargo Obligations”).

Obligations assumed by the Company include a 6 % royalty on all sales of tadalafil-finasteride and sales milestone payments of up to $ 22.5

million, payable to Camargo as follows:

(i) $5.0 million is payable upon the first time the Company achieves net sales from ENTADFI®

of $100.0 million during a calendar year, (ii) $7.5 million is payable upon the first time the Company achieves net sales from ENTADFI®

of $200.0 million during a calendar year, and (3) $10.0 million is payable upon the first time the Company achieves net sales from ENTADFI®

of $300.0 million during a calendar year.

On September 29, 2023, the

Company entered into an amendment to the Veru APA (the “Veru APA Amendment”), which provides that the $4.0 million note payable

originally due on September 30, 2023 was deemed paid and fully satisfied upon (1) the payment to the Seller of $1.0 million in cash on

September 29, 2023, and (2) the issuance to the Seller by October 3, 2023 of 3,000 shares of Series A Convertible Preferred Stock (the

“Series A Preferred Stock”) of the Company (see Note 9) .

Pursuant to the Veru APA Amendment, the Series A Preferred Stock

will convert to common stock of the Company one year from the date of issuance if the required stockholder approval is obtained.

Series A Preferred Stock, which was issued to the Seller on October 3, 2023 is initially convertible, in the aggregate, into 5,709,935

shares of the Company’s common stock, subject to adjustment and certain stockholder approval limitations specified in the Certificate

of Designations.

Pursuant to the Veru APA Amendment, the Company agreed to use commercially reasonable efforts to obtain such stockholder

approval by December 31, 2023, however, such shareholder approval was not obtained as of December 31, 2023.

The Company also agreed to

include the shares of common stock issuable upon conversion of the Series A Preferred Stock in the next resale registration statement

filed with the SEC.

Also, in connection with

the Transaction, and pursuant to the Veru APA, the Company entered into non-competition and non-solicitation agreements (the “Non-Competition

(i) $10.0 million is payable upon the first time the Company achieves

net sales from ENTADFI® of $100.0 million during a calendar year, (ii) $20.0 million is payable upon the first time the Company

achieves net sales from ENTADFI of $200.0 million during a calendar year, and (3) $50.0 million is payable upon the first time the Company

achieves net sales from ENTADFI of $500.0 million during a calendar year.

In connection with the Transaction, the Company

also assumed royalty and milestone obligations under an asset purchase agreement for tadalafil-finasteride combination entered into

by Veru and Camargo Pharmaceutical Services, LLC on December 11, 2017 (the “Camargo Obligations”).

The Camargo Obligations

assumed by the Company include a 6 % royalty on all sales of tadalafil-finasteride and sales milestone payments of up to $ 22.5 million,

payable to Camargo as follows:

(i) $5.0 million is payable upon the first time the Company achieves net sales from ENTADFI of $100.0

million during a calendar year, (ii) $7.5 million is payable upon the first time the Company achieves net sales from ENTADFI of $200.0

million during a calendar year, and (3) $10.0 million is payable upon the first time the Company achieves net sales from ENTADFI of $300.0

million during a calendar year.

On September 29, 2023, the Company entered into

an amendment to the Veru APA (the “Veru APA Amendment”), which provides that the $ 4.0 million note payable originally due

on September 30, 2023 was deemed paid and fully satisfied upon (1) the payment to the Seller of $ 1.0 million in cash on September 29,

2023, and (2) the issuance to the Seller by October 3, 2023 of 3,000 shares of Series A Convertible Preferred Stock (the “Series

A Preferred Stock”) of the Company (see Note 9).

Pursuant to the Veru APA Amendment, the Series A Preferred Stock will convert to

common stock of the Company one year from the date of issuance if the required stockholder approval is obtained.

The Series A Preferred

Stock, which was issued to the Seller on October 3, 2023 is initially convertible, in the aggregate, into 142,479 shares of the Company’s

common stock, subject to adjustment and certain stockholder approval limitations specified in the Certificate of Designations.

to the Veru APA Amendment, the Company agreed to use commercially reasonable efforts to obtain such stockholder approval by December 31,

2023, however, such shareholder approval was not obtained as of December 31, 2023.

The Company also agreed to include the shares of common

stock issuable upon conversion of the Series A Preferred Stock in the next resale registration statement filed with the SEC.

On April 24, 2024, the Company entered into a

Forbearance Agreement with Veru in connection with the Company’s default on the $ 5.0 million non-interest bearing note payable that

was due on April 19, 2024 (see Note 7).

On September 19, 2024, the Company entered into

an Amended and Restated Forbearance Agreement with Veru, which further modified the terms of both the April and September Veru notes outstanding

(see Note 7).

Also, in connection with, and at the time of the

Transaction, and pursuant to the Veru APA, the Company entered into non-competition and non-solicitation agreements (the “Non-Competition

Agreements”) with two of Veru’s key stockholders and employees (the “Restricted Parties”).

2 unchanged sentences

is defined in the Veru APA) for a period of five years from the closing of the Transaction.

The acquisition of ENTADFI® has

been accounted for as an asset acquisition in accordance with ASC 805-50 because substantially all of the fair value of the assets

acquired is concentrated in a single asset, the ENTADFI® product rights.

The ENTADFI® products rights consist of trademarks, regulatory

approvals, and other records, and are considered a single asset as they are inextricably linked.

The following table summarizes

the aggregate consideration transferred for the assets acquired by the Company in connection with the Veru APA:

The acquisition of ENTADFI was accounted

for as an asset acquisition in accordance with ASC 805-50 because substantially all of the fair value of the assets acquired is concentrated

in a single asset, the ENTADFI product rights.

The ENTADFI products rights consist of trademarks, regulatory approvals, and other records,

and are considered a single asset as they are inextricably linked.

The following table summarizes the aggregate consideration

transferred for the assets acquired by the Company in connection with the Veru APA:

Consideration

3 unchanged sentences

Total consideration transferred

The fair value of the non-interest

bearing notes payable was estimated using a net present value model using discount rates averaging 8.2 %.

The resulting fair value is being

accreted to the face value of the notes, through the respective maturity dates.

Management evaluated the Milestone Payments and determined

that at the close of the Transaction, they are not considered probable, and as such, the Company did not recognize any amount related

to the Milestone Payments in the consideration transferred.

The fair value of the non-interest bearing notes

payable was estimated using a net present value model using discount rates averaging 8.2 %.

The resulting fair value is being accreted

to the face value of the notes, through the respective maturity dates.

Management evaluated the Milestone Payments and determined that

at the close of the Transaction, they are not considered probable, and as such, the Company did not recognize any amount related to the

Milestone Payments in the consideration transferred.

Management evaluated the Camargo Obligations and

determined that at the close of the Transaction, the related sales milestone payments are not considered probable, and as such, the Company

did not recognize any related liability at the date of the Transaction.

ONCONETIX, INC.

1 unchanged sentence

Note 5 — Acquisitions (cont.)

The following table summarizes the assets acquired

with the Veru APA:

The following table summarizes the assets acquired with the Veru APA:

Assets Recognized

1 unchanged sentence

Total fair value of identifiable assets acquired

In accordance with ASC 805-50,

the acquired inventory was recorded at fair value.

The remaining consideration transferred was allocated to the ENTADFI® intangible

asset, which will be amortized over its estimated useful life, starting when ENTADFI® sales begin.

Acquired inventory is

comprised of work-in-process and raw materials.

The fair value of work-in-process inventory was determined based on an estimated sales

price of the finished goods, adjusted for costs to complete the manufacturing process, costs of the selling effort, a reasonable

profit allowance for the remaining manufacturing and selling effort, and an estimate of holding costs, and resulted in a fair

value adjustment of approximately $ 0.3 million.

In accordance with ASC 805-50, the acquired inventory

was recorded at fair value.

The remaining consideration transferred was allocated to the ENTADFI® intangible asset, which will be

amortized over its estimated useful life, starting when ENTADFI® sales begin.

Acquired inventory is comprised of work-in-process

and raw materials.

The fair value of work-in-process inventory was determined based on an estimated sales price of the finished goods,

adjusted for costs to complete the manufacturing process, costs of the selling effort, a reasonable profit allowance for the

remaining manufacturing and selling effort, and an estimate of holding costs, and resulted in a fair value adjustment of approximately

$ 0.3 million.

The fair value of raw materials was determined to approximate replacement cost.

recorded an impairment charge on the ENTADFI asset group of $ 14.7 million during the fourth quarter of 2023 (see Note 4), as well as an

impairment charge on the ENTADFI acquired inventory of approximately $ 1.2 million, which included impairment of 100 % of the acquired work-in-process

Management evaluated the

Camargo Obligations and determined that at the close of the Transaction, the related sales milestone payments are not considered probable,

and as such, the Company did not recognize any related liability at the date of the Transaction.

In addition, royalties under the Camargo

Obligations will be recorded as cost of sales, as the related sales are generated and recognized.

On June 13, 2023 (the “Execution

Date”), the Company entered into an asset purchase agreement with WraSer, LLC, and affiliates (the “WraSer Seller”)

(the “WraSer APA”).

Pursuant to, and subject to the terms and conditions of, the WraSer APA, on the WraSer Closing Date (as

defined below) the Company was to purchase six FDA-approved pharmaceutical assets across several indications, including cardiology, otic

infections, and pain management (the “WraSer Assets”).

Under the terms of the WraSer

APA, the Company was to purchase the WraSer Assets for (i) $3.5 million in cash at signing of the WraSer APA;

(ii) $4.5 million in cash

on the later of (x) 90 days after the signing of the WraSer APA or (y) the date that all closing conditions under the WraSer APA are met

or otherwise waived (the “WraSer Closing Date”);

(iii) 1.0 million shares of the Company’s common stock (the “Closing

Shares”) issuable on the WraSer Closing Date, and (iv) $500,000 in cash one year from the WraSer Closing Date.

In conjunction with the WraSer

APA, the Company and the WraSer Seller entered into a Management Services Agreement (the “MSA”) on the Execution Date.

to the terms of the MSA, the Company will act as the manager of the WraSer Seller’s business during the period between the Execution

Date and the WraSer Closing Date.

The Company recorded an impairment charge on the

ENTADFI asset group of $ 3.5 million during the year ended December 31, 2024 (see Note 4), and an impairment charge on the ENTADFI inventory

of approximately $ 0.4 million during the year ended December 31, 2024.

In addition, during the fourth quarter of 2023, the Company recorded

an impairment charge of approximately $ 14.7 million on the ENTADFI asset group, as well as an impairment charge on the ENTADFI acquired

inventory of approximately $ 1.2 million, which included impairment of 100 % of the acquired work-in-progress inventory.

On June 13, 2023 (the “Execution Date”),

the Company entered into an asset purchase agreement with WraSer, LLC, and affiliates (the “WraSer Seller”) (the “WraSer

Pursuant to, and subject to the terms and conditions of, the WraSer APA, on the WraSer Closing Date (as defined below) the

Company was to purchase six FDA-approved pharmaceutical assets across several indications, including cardiology, otic infections, and

pain management (the “WraSer Assets”).

Under the terms of the WraSer APA, the Company

was to purchase the WraSer Assets for (i) $3.5 million in cash at signing of the WraSer APA;

(ii) $4.5 million in cash on the later of

(x) 90 days after the signing of the WraSer APA or (y) the date that all closing conditions under the WraSer APA are met or otherwise

waived (the “WraSer Closing Date”);

(iii) 25,000 shares of the Company’s common stock (the “Closing Shares”)

issuable on the WraSer Closing Date, and (iv) $500,000 in cash one year from the WraSer Closing Date.

In conjunction with the WraSer APA, the Company

and the WraSer Seller entered into a Management Services Agreement (the “MSA”) on the Execution Date.

Pursuant to the terms

of the MSA, the Company will act as the manager of the WraSer Seller’s business during the period between the Execution Date and

the WraSer Closing Date.

During this period, the Company will make advances to WraSer, if needed.

If, on the WraSer Closing Date,

the WraSer Seller’s cash balance is in excess of the target amount (“Cash Target”) specified in the MSA, the Company

will apply that excess to the $ 4.5 million cash payment due upon closing.

If, on the WraSer Closing Date, the

WraSer Seller’s cash balance is in excess of the target amount (“Cash Target”) specified in the MSA, the Company will

apply that excess to the $ 4.5 million cash payment due upon closing.

Conversely, if there is a shortfall, the Company will be required

to remit the difference to the WraSer Seller over time.

The WraSer APA can be terminated

prior to the closing upon agreement with all parties or upon breach of contract of either party, uncured within 20 days of notice.

the WraSer APA is terminated upon agreement with all parties or upon uncured breach of contract by the Company, the initial $ 3.5 million

payment is retained by the WraSer Seller.

If it is determined that there is an uncured breach of contract by the WraSer Seller, and the

WraSer APA is terminated, the Company will have an unsecured claim against WraSer for the $ 3.5 million payment made by the Company upon

execution of the WraSer APA.

The closing of the transaction is subject to certain customary closing conditions, including submission of

the FDA transfer documentation to transfer ownership of the acquired product regulatory approvals to the Company.

The WraSer APA could be terminated prior to the

closing upon agreement with all parties or upon breach of contract of either party, uncured within 20 days of notice.

If the WraSer APA

was terminated upon agreement with all parties or upon uncured breach of contract by the Company, the initial $ 3.5 million payment would

be retained by the WraSer Seller.

If it is determined that there is an uncured breach of contract by the WraSer Seller, and the WraSer

APA was terminated, the Company will have an unsecured claim against WraSer for the $ 3.5 million payment made by the Company upon execution

of the WraSer APA.

The closing of the transaction is subject to certain customary closing conditions, including submission of the FDA

transfer documentation to transfer ownership of the acquired product regulatory approvals to the Company.

ONCONETIX, INC.

1 unchanged sentence

Note 5 — Acquisitions (cont.)

Management evaluated the

terms of the WraSer APA and the WraSer MSA, and determined that, at the Execution Date, control under the provisions of ASC 805, Business

Combinations (“ASC 805”), did not transfer to the Company;

if the transaction closes, control will transfer then, and

the acquisition date will be the closing date.

Management further evaluated the requirements pursuant to ASC 810, Consolidations ,

and determined based on the terms of the MSA, and the Company’s involvement in the WraSer Seller’s business, that the WraSer

Seller is a variable interest entity (“VIE”) to the Company.

Management determined that the Company is not the primary beneficiary

of the VIE as the WraSer APA and MSA do not provide the Company with the power to direct the activities of the VIE that most significantly

impact the VIE’s economic performance.

While the Company was involved in the day-to-day business activities of the VIE until WraSer

Management evaluated the terms of the WraSer APA

and the WraSer MSA, and determined that, at the Execution Date, control under the provisions of ASC 805, Business Combinations (“ASC

805”), did not transfer to the Company;

if the transaction closes, control will transfer then, and the acquisition date will be

the closing date.

Management further evaluated the requirements pursuant to ASC 810, Consolidations , and determined based on the

terms of the MSA, and the Company’s involvement in the WraSer Seller’s business, that the WraSer Seller is a variable interest

entity (“VIE”) to the Company.

Management determined that the Company is not the primary beneficiary of the VIE as the WraSer

APA and MSA do not provide the Company with the power to direct the activities of the VIE that most significantly impact the VIE’s

economic performance.

While the Company was involved in the day-to-day business activities of the VIE until WraSer filed for relief under

Chapter 11 of the U.S.

Bankruptcy Court (see below), the WraSer Seller had to approve substantially all business activities and transactions

that significantly impact the economic performance of WraSer during the term of the MSA.

Additionally, the Company is not required to

absorb the losses of WraSer if the WraSer APA does not close.

As such, the Company was not required to consolidate WraSer in the Company’s

financial statements as of the years ended December 31, 2024 and 2023.

The Company recorded the initial $ 3.5 million

payment as a deposit.

The Company does not have any liabilities recorded as of December 31, 2024 and 2023 associated with its variable

interest in the WraSer Seller, and its exposure to the WraSer Seller’s losses is limited to no more than the shortfall, if any,

of the Cash Target amount of approximately $ 1.1 million compared to the WraSer Seller’s cash balance on the WraSer Closing Date.

On September 26, 2023, WraSer and its affiliates

filed for relief under chapter 11 of the U.S.

Bankruptcy Court (see below), the WraSer Seller had to approve substantially all business

activities and transactions that significantly impact the economic performance of WraSer during the term of the MSA.

Additionally, the

Company is not required to absorb the losses of WraSer if the WraSer APA does not close.

As such, the Company was not required to consolidate

WraSer in the Company’s financial statements as of and during the year ended December 31, 2023.

The Company recorded the

initial $ 3.5 million payment as a deposit.

The Company does not have any liabilities recorded as of December 31, 2023 associated with

its variable interest in the WraSer Seller, and its exposure to the WraSer Seller’s losses is limited to no more than the shortfall,

if any, of the Cash Target amount of approximately $ 1.1 million compared to the WraSer Seller’s cash balance on the WraSer Closing

On September 26, 2023, WraSer

and its affiliates filed for relief under chapter 11 of the U.S.

Bankruptcy Code in the Bankruptcy Court.

On October 4, 2023, the parties

agreed to amend the WraSer APA, which was subject to court approval.

Shortly after

its bankruptcy filing, WraSer filed a motion seeking approval of the WraSer APA as amended.

The amendment, among other things, eliminates

the $ 500,000 post-closing payment due June 13, 2024 and staggers the $ 4.5 million cash payment that the Company

would otherwise have to pay at closing to:

(i) $2.2 million to be

paid at closing, (ii) $2.3 million, to be paid in monthly installments of $150,000 commencing January 2024 and (iii) 789 shares

On October 4, 2023, the parties agreed to amend

the WraSer APA, which was subject to court approval.

Shortly after its bankruptcy filing, WraSer filed a motion seeking approval of the

WraSer APA as amended.

The amendment, among other things, eliminates the $ 500,000 post-closing payment due June 13, 2024 and

staggers the $ 4.5 million cash payment that the Company would otherwise have to pay at closing to:

(i) $2.2 million to

be paid at closing, (ii) $2.3 million, to be paid in monthly installments of $150,000 commencing January 2024 and (iii) 789 shares

of Series A Preferred Stock to be paid at closing .

The amendment also reduced the number of products the Company was acquiring by

excluding pain medications and including only (i) Ciprofloxacin 0.3% and Fluocinolone 0.025% Otic Solution, under the trademark

OTOVEL and its Authorized Generic Version approved under US FDA NDA No.

208251, (ii) Ciprofloxacin 0.2% Otic solution, under the

trademark CETRAXAL, and (iii) Vorapaxar Sulfate tablets under the trademark Zontivity approved under US FDA NDA N204886.

October 2023, WraSer alerted the Company that its sole manufacturer for the active pharmaceutical ingredient (“API”)

for Zontivity, the key driver for the WraSer acquisition, would no longer manufacture the API for Zontivity.

The Company believes that

this development constituted a Material Adverse Effect under the WraSer APA and the WraSer MSA, enabling the Company to terminate

the WraSer APA and the WraSer MSA.

On October 20, 2023, the Company filed a motion for relief from the automatic stay in the Bankruptcy

Court so that the Company can exercise the termination rights under the WraSer APA, as amended.

December 18, 2023, the Bankruptcy Court entered into an Agreed Order lifting the automatic stay to enable the Company to exercise

its rights to terminate the WraSer APA and the WraSer MSA.

On December 21, 2023, the Company filed a Notice with the Bankruptcy

Court terminating the WraSer APA and the WraSer MSA.

WraSer has advised the Company that it does not believe that a Material

Adverse Effect occurred.

Due to the WraSer bankruptcy filing and the Company’s status as an unsecured creditor of WraSer, it is

unlikely that the Company will recover the $ 3.5 million initial payment made, or any costs and resources in connection with services provided

by the Company under the WraSer MSA, and therefore the Company recorded a loss on impairment for the $ 3.5 million deposit during the year

ended December 31, 2023.

On December 15, 2023 (the

“Acquisition Date”), Onconetix entered into a Share Exchange Agreement (the “Share Exchange Agreement”) with Proteomedix

and each of the holders of outstanding capital stock or Proteomedix convertible securities (other than Proteomedix stock options) (collectively

the “Sellers”), pursuant to which the Company acquired 100 % of the outstanding

common shares and voting interest of Proteomedix, through the issuance of 3,675,414 shares of common

stock and 2,696,729 shares of Series B Convertible Preferred Stock (the “PMX Transaction”).

to any requirements related to the Committee on Foreign Investment in the United States, upon approval by the requisite vote of stockholders

of Onconetix at the Special Meeting of the Stockholders (“Stockholder Approval”), each share of Series B Convertible Redeemable

Preferred Stock (“Series B Preferred Stock”) shall automatically convert into 100 shares of common stock in accordance with

the terms of the Series B Certificate of Designation (the “Conversion”).

If Stockholder Approval is not obtained by January

1, 2025, Onconetix may, at the option of the holders, be obligated to cash settle the Series B Preferred Stock.

The Series B Preferred

Stock outstanding as a result of the PMX Transaction is convertible into 269,672,900 shares of common stock.

excluding pain medications and including only (i) Ciprofloxacin 0.3% and Fluocinolone 0.025% Otic Solution, under the trademark OTOVEL

and its Authorized Generic Version approved under US FDA NDA No.

208251, (ii) Ciprofloxacin 0.2% Otic solution, under the trademark

CETRAXAL, and (iii) Vorapaxar Sulfate tablets under the trademark Zontivity approved under US FDA NDA N204886.

In October 2023, WraSer alerted the Company

that its sole manufacturer for the active pharmaceutical ingredient (“API”) for Zontivity, the key driver for the WraSer acquisition,

would no longer manufacture the API for Zontivity.

The Company believes that this development constituted a Material Adverse Effect under

the WraSer APA and the WraSer MSA, enabling the Company to terminate the WraSer APA and the WraSer MSA.

On October 20, 2023, the Company

filed a motion for relief from the automatic stay in the Bankruptcy Court so that the Company can exercise the termination rights under

the WraSer APA, as amended.

On December 18, 2023, the Bankruptcy Court entered into an Agreed Order lifting the automatic stay to

enable the Company to exercise its rights to terminate the WraSer APA and the WraSer MSA.

On December 21, 2023, the Company

filed a Notice with the Bankruptcy Court terminating the WraSer APA and the WraSer MSA.

WraSer has advised the Company that it does

not believe that a Material Adverse Effect occurred.

Due to the WraSer bankruptcy filing and the Company’s status as an unsecured

creditor of WraSer, it is unlikely that the Company will recover the $ 3.5 million initial payment made, or any costs and resources in

connection with services provided by the Company under the WraSer MSA, and therefore the Company recorded a loss on impairment for the

$ 3.5 million deposit during the year ended December 31, 2023.

ONCONETIX, INC.

1 unchanged sentence

Note 5 — Acquisitions (cont.)

consummation (the “Closing”) of the PMX Transaction was subject to customary closing conditions and the agreement to enter

into a subscription agreement (see Note 8) with Altos Ventures, a shareholder of Proteomedix, prior to the closing of the

PMX Transaction (the “PMX Investor”).

addition, each option to purchase shares of Proteomedix (each, a “Proteomedix Stock Option”) outstanding immediately before

the Closing, whether vested or unvested, remains outstanding until the Conversion unless otherwise terminated in accordance with its terms.

At the Conversion, each outstanding Proteomedix Stock Option, whether vested or unvested, shall be assumed by Onconetix and converted

into the right to receive (a) an option to acquire shares of common stock (each, an “Assumed Option”) or (b) such other derivative

security as Onconetix and Proteomedix may agree, subject in either case to substantially the same terms and conditions as were applicable

to such Proteomedix Stock Option immediately before the Closing.

On December 15, 2023 (the “Acquisition Date”), Onconetix

entered into a Share Exchange Agreement (the “Share Exchange Agreement”) with Proteomedix and each of the holders of outstanding

capital stock or Proteomedix convertible securities (other than Proteomedix stock options) (collectively the “Sellers”), pursuant

to which the Company acquired 100 % of the outstanding common shares and voting interest of Proteomedix, through the issuance of

91,885 shares of common stock and 2,696,729 shares of Series B Convertible Preferred Stock (the

“PMX Transaction”) convertible into 6,741,820 shares of Common Stock .

Upon approval by

the requisite vote of stockholders of Onconetix at the Special Meeting of the Stockholders (“Stockholder Approval”), each

share of Series B Convertible Redeemable Preferred Stock (“Series B Preferred Stock”) was automatically convertible into 100 shares

of common stock in accordance with the terms of the Series B Certificate of Designation (the “Conversion”).

If Stockholder

Approval was not obtained by January 1, 2025, Onconetix was, at the option of the holders, obligated to cash settle the Series B Preferred

Stock at the option of the holders.

The Series B Preferred Stock outstanding as a result of the PMX Transaction was convertible into 6,741,820 shares

of common stock.

Stockholder Approval was obtained on September 5, 2024 and the Conversion occurred subsequently on September 24, 2024

(see Note 9).

The consummation (the “Closing”)

of the PMX Transaction was subject to customary closing conditions and the agreement to enter into a subscription agreement (see Note

8) with Altos Ventures, a shareholder of Proteomedix, prior to the closing of the PMX Transaction (the “PMX Investor”).

In addition, each option to purchase

shares of Proteomedix (each, a “Proteomedix Stock Option”) outstanding immediately before the Closing, whether vested or unvested,

remains outstanding until the Conversion unless otherwise terminated in accordance with its terms.

At the Conversion, each outstanding

Proteomedix Stock Option, whether vested or unvested, shall be assumed by Onconetix and converted into the right to receive (a) an option

to acquire shares of common stock (each, an “Assumed Option”) or (b) such other derivative security as Onconetix and Proteomedix

may agree, subject in either case to substantially the same terms and conditions as were applicable to such Proteomedix Stock Option immediately

before the Closing.

Each Assumed Option shall:

(i) represent the right to acquire a number

of shares of common stock equal to the product of (A) the number of Proteomedix common shares that were subject to the corresponding Proteomedix

Option immediately prior to the Closing, multiplied by (B) the Exchange Ratio (as defined in the Share Exchange Agreement”);

(ii) have an exercise price (as rounded down to the nearest whole cent) equal to the quotient of (A) the exercise price of the corresponding

Proteomedix Option, divided by (B) the Exchange Ratio.

determined that the PMX Transaction was a business combination as defined within ASC 805 , and that Onconetix was the accounting

(i) represent the right to acquire a number of shares of common stock equal to the product

of (A) the number of Proteomedix common shares that were subject to the corresponding Proteomedix Option immediately prior to the Closing,

multiplied by (B) the Exchange Ratio (as defined in the Share Exchange Agreement”);

and (ii) have an exercise price (as rounded

down to the nearest whole cent) equal to the quotient of (A) the exercise price of the corresponding Proteomedix Option, divided by (B)

the Exchange Ratio.

The Company completed the Conversion on September 24, 2024, and the Company is in process of exchanging

the Proteomedix Stock Options into Onconetix restricted stock units as of the date of this filing.

As of December 31, 2024, the PMX option

holders continue to own Proteomedix Stock Options.

Management determined

that the PMX Transaction was a business combination as defined within ASC 805 , and that Onconetix was the accounting acquirer.

The Company determined that Onconetix was the accounting acquirer based on the guidance contained within ASC 805-10.

The significant

factors that led to the Company’s conclusion were ( i) the Company obtained 100% of the outstanding common stock and voting interest

of PMX, (ii) at closing of the PMX Transaction, the PMX shareholders were issued approximately 17% of Onconetix’s outstanding common

stock and none of the former PMX shareholders held more than 5% of Onconetix’s common stock individually, (iii) the composition of

executive management and the governing body did not change sufficiently to give PMX or its former shareholders control over these functions

within Onconetix, and (iv) Onconetix was significantly larger when considering both total assets and operations.

The significant factors

that led to the Company’s conclusion were ( i) the Company obtained 100% of the outstanding common stock and voting interest of PMX,

(ii) at closing of the PMX Transaction, the PMX shareholders were issued approximately 17% of Onconetix’s outstanding common stock

and none of the former PMX shareholders held more than 5% of Onconetix’s common stock individually, (iii) the composition of executive

management and the governing body did not change sufficiently to give PMX or its former shareholders control over these functions within

Onconetix, and (iv) Onconetix was significantly larger when considering both total assets and operations.

As a result, the

3 unchanged sentences

consolidated statements of operations and comprehensive loss from that date forward.

Proteomedix is a healthcare

company whose mission is to transform prostate cancer diagnosis.

Proteomedix has identified novel biomarker signatures with utility in

prostate cancer diagnosis, prognosis and therapy management.

The Company expects Proteomedix’s diagnostic expertise to complement

its existing prostate related treatment portfolio.

The assets acquired and

liabilities assumed are recognized provisionally in the accompanying consolidated balance sheets at their estimated fair values as

of the acquisition date.

The initial accounting for the business combination is not complete as the Company is in the process of

obtaining additional information for the valuation of acquired intangible assets and deferred tax liabilities.

The provisional amounts are subject to change to

the extent that additional information is obtained about the facts and circumstances that existed as of the acquisition date.

GAAP, the measurement period shall not exceed one year from the acquisition date and the Company will finalize these amounts no

later than December 15, 2024.

The estimated fair values as of the acquisition date are based on information that existed as of the

acquisition date.

During the measurement period the Company may adjust provisional amounts recorded for assets acquired and

liabilities assumed to reflect new information that the Company has subsequently obtained regarding facts and circumstances that

existed as of the acquisition date.

The acquisition-date fair

value of the consideration transferred totaled approximately $ 65.1 million, which consisted of the following:

Consideration

Series B convertible preferred stock

Total consideration transferred

The fair value of the Company’s

common shares issued as consideration was based on the closing price of the Company’s common stock as of the Acquisition Date.

fair value of the Series B Preferred Stock issued as consideration was based on the underlying fair value of the number of common shares

that the Series B Preferred Stock converts into, also based on the closing price of the Company’s common stock as of the Acquisition

ONCONETIX, INC.

1 unchanged sentence

Note 5 — Acquisitions (cont.)

The fair value of the Proteomedix

stock options assumed as part of the PMX Transaction was determined using a Black-Scholes option pricing model with the following significant

The acquisition-date fair value of the consideration

transferred totaled approximately $ 65.1 million, which consisted of the following:

Consideration

Series B convertible preferred stock

Total consideration transferred

The fair value of the Company’s common shares

issued as consideration was based on the closing price of the Company’s common stock as of the Acquisition Date.

The fair value

of the Series B Preferred Stock issued as consideration was based on the underlying fair value of the number of common shares that the

Series B Preferred Stock converts into, also based on the closing price of the Company’s common stock as of the Acquisition Date.

The fair value of the Proteomedix stock options

assumed as part of the PMX Transaction was determined using a Black-Scholes option pricing model with the following significant assumptions:

Exercise price

3 unchanged sentences

4.07 % – 5.47 %

The following table summarizes

the preliminary estimated fair values of the assets acquired and liabilities assumed at the acquisition date:

We finalized the purchase price allocation on

December 15, 2024.

The following table summarizes the fair values of the assets acquired, and liabilities assumed at the acquisition date:

Accounts receivable

2 unchanged sentences

Property and equipment, net

( 6,239,000 )

Customer relationships

Product rights for developed technology

( 3,264,000 )

Total assets acquired

( 1,927,157 )

Accounts payable

3 unchanged sentences

( 2,994,669 )

( 1,067,512 )

Pension benefit obligation

1 unchanged sentence

( 4,774,823 )

( 2,847,666 )

Less non-controlling interest

( 7,006,504 )

Net assets acquired

The goodwill recognized as

a result of the PMX Transaction is attributable primarily to expected synergies and the assembled workforce of Proteomedix.

goodwill is expected to be deductible for income tax purposes.

The fair values of the acquired

tangible and intangible assets were determined using variations of the cost, income approach using the excess earnings, lost profits and

relief from royalty methods.

The income approach valuation methodology used for the intangible assets acquired in the PMX Transaction

makes use of Level 3 inputs.

The trade name intangible

asset represents the value of the Proclarix™ brand name and was valued using a relief from royalty method under an income approach.

A royalty rate of 6 % was utilized in determining the fair value of this intangible asset.

The fair value of this asset was determined

based on a cash flow model using forecasted revenues and expenses specifically tied to Proclarix™.

Those cash flows were then discounted

at 10 % determined by the use of a weighted average return on assets analysis.

The life of this intangible asset was determined to be indefinite

as the branded name will persist beyond the life of the product rights and customer relationships.

The customer relationship

intangible assets represent the value of the existing customer contract with Labcorp (see Note 6) and was valued using the lost profits

method under the income approach.

The fair value of this asset was determined based on a cash flow model using forecasted revenues specifically

tied to Proteomedix’s Labcorp contract.

Those cash flows were then discounted at 10 % determined by the use of a weighted average

return on assets analysis.

The estimated useful life of this asset was determined by reference to the estimated life of the product rights

associated with the Labcorp contract.

The product rights for

developed technology acquired in the PMX Transaction represents know-how and patented intellectual property held by PMX pertaining

to its commercial-ready prostate cancer diagnostic system, Proclarix™.

The fair value of this asset was determined based on a

cash flow model based on forecasted revenues and expenses specifically tied to Proclarix™.

Those cash flows were then

discounted at 8 % for the period prior to patent expiration and 16 % for the period thereafter.

The discount rates were determined by

the use of a weighted average return on assets analysis.

The estimated useful life of the product rights was determined based on the

underlying patent’s remaining life.

ONCONETIX, INC.

1 unchanged sentence

Note 5 — Acquisitions (cont.)

The fair value of the

non-controlling interest in Proteomedix is estimated to be $ 7.0 million and represents the fair value of the vested Proteomedix stock

options outstanding as of the Acquisition Date.

The fair value of the non-controlling interest was valued using the methodology applicable

to the Proteomedix stock options disclosed above.

As Proteomedix was a private company as of the Acquisition Date, the fair value measurement

is based on significant inputs that are not observable in the market and thus represents a Level 3 measurement as defined in ASC 820,

Fair Value Measurement .

Company recognized approximately $ 1.5 million of acquisition related costs that were expensed during 2023, including the fair value of

the subscription agreement liability, which was a closing condition for the PMX Transaction (see Note 8).

These costs are included in

selling, general and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss.

The amounts of revenue and

loss of Proteomedix, included in the Company’s consolidated statements of operations and comprehensive loss from the Acquisition

Date through December 31, 2023 are as follows:

The following summary, prepared

on a pro forma basis, presents the Company’s unaudited consolidated results of operations for 2023 and 2022 as if the PMX Transaction

had been completed as of January 1, 2022.

During the year ended December 31, 2024, we recorded

measurement period adjustments to decrease intangible assets, specifically the trade name, customer relationships, and product rights

for developed technology, as a result of revised future cash flow estimates and to decrease deferred tax liability as a result of changes

in net operating loss estimates from the initial purchase price allocation.

In addition, the measurement period adjustment included a

change in the useful life determination of the tradename from indefinite to 15-years.

These measurement period adjustments were made to

reflect facts and circumstances that existed as of the acquisition date.

The net effect of these adjustments would have resulted in an

insignificant decrease in amortization expense recorded during the year ended December 31, 2024.

The measurement period adjustments were

recorded in our consolidated financial statements as of and for the year ended December 31, 2024.

The goodwill recognized as a result of the PMX

Transaction is attributable primarily to expected synergies and the assembled workforce of Proteomedix.

None of the goodwill is expected

to be deductible for income tax purposes.

The fair values of the acquired tangible and intangible

assets were determined using variations of the cost, income approach using the excess earnings, lost profits and relief from royalty methods.

The income approach valuation methodology used for the intangible assets acquired in the PMX Transaction makes use of Level 3 inputs.

The trade name intangible asset represents the

value of the Proclarix™ brand name and was valued using a relief from royalty method under an income approach.

A royalty rate of

6 % was utilized in determining the fair value of this intangible asset.

The fair value of this asset was determined based on a cash flow

model using forecasted revenues and expenses specifically tied to Proclarix™.

Those cash flows were then discounted at 10 % determined

by the use of a weighted average return on assets analysis The estimated useful life of the trade name of 15-years was determined based

on the underlying patent’s remaining life.

The customer relationship intangible assets represent

the value of the existing customer contract with LabCorp (see Note 5) and was valued using the lost profits method under the income approach.

The fair value of this asset was determined based on a cash flow model using forecasted revenues specifically tied to Proteomedix’s

LabCorp contract.

Those cash flows were then discounted at 10 % determined by the use of a weighted average return on assets analysis.

The estimated useful life of this asset was determined by reference to the estimated life of the product rights associated with the LabCorp

The product rights for developed technology acquired

in the PMX Transaction represents know-how and patented intellectual property held by PMX pertaining to its commercial-ready prostate

cancer diagnostic system, Proclarix™.

The fair value of this asset was determined based on a cash flow model based on forecasted

revenues and expenses specifically tied to Proclarix™.

Those cash flows were then discounted at 7 % for the period prior to patent

expiration and 14 % for the period thereafter.

The discount rates were determined by the use of a weighted average return on assets analysis.

The estimated useful life of the product rights was determined based on the underlying patent’s remaining life.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 5 — Acquisitions (cont.)

The fair value of the non-controlling interest

in Proteomedix was estimated to be $ 7.0 million and represented the fair value of the vested Proteomedix stock options outstanding as

of the Acquisition Date.

The fair value of the non-controlling interest was valued using the methodology applicable to the Proteomedix

stock options disclosed above.

As Proteomedix was a private company as of the Acquisition Date, the fair value measurement is based on

significant inputs that are not observable in the market and thus represents a Level 3 measurement as defined in ASC 820, Fair Value

Measurement .

The Company recognized approximately $ 1.5 million

of acquisition related costs that were expensed during 2023, including the fair value of the subscription agreement liability, which was

a closing condition for the PMX Transaction (see Note 8).

The amounts of revenue and loss of Proteomedix,

included in the Company’s consolidated statements of operations and comprehensive loss from the Acquisition Date through December

31, 2023 are as follows:

The following summary, prepared on a pro forma

basis, presents the Company’s unaudited consolidated results of operations for 2023 and 2022 as if the PMX Transaction had been

completed as of January 1, 2022.

The pro forma results below include the impact of amortization of intangible assets.

forma information is presented for illustrative purposes only, is not necessarily indicative of future results of operations and does

not include any impact of transaction synergies.

In addition, the pro forma results are not necessarily indicative of the results of

operations that actually would have been achieved had the PMX Transaction been consummated as of that date:

This pro forma

information is presented for illustrative purposes only, is not necessarily indicative of future results of operations and does not include

any impact of transaction synergies.

In addition, the pro forma results are not necessarily indicative of the results of operations that

actually would have been achieved had the PMX Transaction been consummated as of that date:

For the Years Ended

Note 6 — Significant Agreements

Ology Bioservices, Inc.

(which was later acquired by National Resilience,

The Company entered into

a Master Services Agreement (“Ology MSA”), dated July 19, 2019, with Ology, Inc.

(“Ology”) to provide services

from time to time, including but not limited to technology transfer, process development, analytical method optimization, cGMP manufacture,

regulatory affairs, and stability studies of biologic products.

Pursuant to the Ology MSA, the Company and Ology shall enter into a Project

Addendum for each project to be governed by the terms and conditions of the Ology MSA.

The Company entered into two

Project Addendums as of December 31, 2023.

The initial Project Addendum was executed on October 18, 2019, and the Company was required

to pay Ology an aggregate of approximately $ 4 million.

Due to unforeseen delays associated with COVID-19, the Company and Ology entered

into a letter agreement dated January 9, 2020 to stop work on the project, at which point the Company had paid Ology $ 100,000 for services

to be provided.

The second Project Addendum was executed on May 21, 2021, and the Company is obligated to pay Ology an aggregate amount

of approximately $ 2.8 million, plus reimbursement for materials and outsourced testing, which will be billed at cost plus 15 %.

2023 and 2022, the Company and Ology entered into contract amendments that resulted in a net decrease in the Company’s obligations

of approximately $ 137,000 .

During the years ended December

31, 2023 and 2022, the Company incurred related research and development expenses of approximately $ 15,000 and $ 1,329,000 , respectively,

and had approximately $ 685,000 recorded as related accounts payable at December 31, 2023, and approximately $ 476,000 and $ 669,000 recorded

as related accounts payable and accrued expenses, respectively, at December 31, 2022.

Services Agreement

On July 21, 2023, the Company, entered into a

Licensing and Services Master Agreement (“Master Services Agreement”) and a related statement of work with a vendor, pursuant

to which the vendor was to provide to the Company commercialization services for the Company’s products, including recruiting, managing,

supervising and evaluating sales personnel and providing sales-related services for such products, for fees totaling up to $ 29.1 million

over the term of the statement of work.

The statement of work had a term through September 6, 2026, unless earlier terminated in accordance

with the Master Services Agreement and the statement of work.

On July 29, 2023, a second statement of work was entered into with the same

vendor for certain subscription services providing prescription market data access to the Company.

The fees under the second statement

of work totaled approximately $ 800,000 , and the term was through July 14, 2025 .

On October 12, 2023, the Company terminated the Master

Services Agreement and the statements of work.

During 2023, the Company recognized a termination fee of approximately $ 1.4 million included

in selling, general and administrative expense in the accompanying consolidated statements of operations and comprehensive loss.

during 2024, the Company agreed with the vendor to pay a reduced termination fee of approximately $ 0.9 million and recorded net credits

of $0.5 million for the difference in the termination fee related to this contract during the year ended December 31, 2024, which is included

in selling, general and administrative expense in the accompanying consolidated statements of operations and comprehensive loss.

had approximately $ 1.1 million and $ 1.8 million recorded in related accounts payable as of December 31, 2024 and 2023, respectively, which

includes amounts due for early termination of the contract.

ONCONETIX, INC.

1 unchanged sentence

Note 6 — Significant Agreements (cont.)

Cincinnati Children’s Hospital Medical Center

The Company entered into a

license agreement (the “CHMC Agreement”), dated June 1, 2021, with Children’s Hospital Medical Center, d/b/a Cincinnati

Children’s Hospital Medical Center (“CHMC”).

Under the terms of the CHMC Agreement, the Company holds an exclusive,

worldwide license (other than the excluded field of immunization against, and prevention, control, or reduction in the severity of gastroenteritis

caused by rotavirus and norovirus in China and Hong Kong) to certain specified patent and biological materials relating to the use of

norovirus nanoparticles and practice processes that are covered by the licensed patent rights and biological materials for the purpose

of developing and commercializing CHMC patents and related technology directed to a virus-like particle vaccine platform that utilizes

nanoparticle delivery technology that may have potential broad application to develop vaccines for multiple infectious diseases.

term of the CHMC Agreement begins on the effective date and extends on a jurisdiction by jurisdiction and product by product basis until

the later of:

(i) the last to expire licensed patent;

(ii) ten (10) years after the first commercial sale;

or (iii) entrance onto the

market of a biosimilar or interchangeable product.

The Company is obligated to use commercially reasonable efforts to bring licensed

products to market through diligent research and development, testing, manufacturing, and commercialization, to use best efforts to make

all necessary regulatory filings and obtain all necessary regulatory approvals, to achieve milestones relating to development and sales,

and report to CHMC on progress.

The Company is obligated to pay certain milestone and royalty payments in the future, as the related

contingent events occur.

Specifically, the Company is obligated to pay CHMC a single-digit royalty on net sales, being 5 %, 4 % or 2 % depending

on the product, until the last valid claim covering a licensed product exists, at which point the royalty rates decrease by 50 %.

Company is also obligated to pay up to a 25 % royalty on any non-royalty sublicense revenue paid to the Company by any sublicensee.

CHMC Agreement also provides the Company with an option to license any CHMC or jointly patented modification, alteration or improvement

of any invention claimed in a Licensed Patent (“CHMC Improvement” and “Joint Improvement, respectively”), with

a $ 50,000 option fee for each Improvement that the Company elects to include in the license grant of the CHMC Agreement.

the Company is required to pay CHMC milestone payments of up to an aggregate of $ 59.75 million;

specifically, upon the achievement of

specified development milestones of approximately $ 0.5 million, regulatory milestones of approximately $ 1.25 million, and commercial

milestones of approximately $ 58.0 million.

The Company may terminate

the CHMC Agreement for convenience at any time prior to first commercial sale of a product or process by providing one hundred and eighty

(180) days’ written notice to CHMC.

It may also terminate for a CHMC uncured material breach.

CHMC may terminate the CHMC Agreement

for an uncured Company material breach or insolvency or bankruptcy.

Pursuant to the terms of the CHMC Agreement, if the Company fails

to achieve the milestones, and cannot mutually agree with CHMC on an amendment to the milestones, then CHMC will have the option of converting

any and all of such exclusive licenses to nonexclusive licenses, to continue developing indications that have already entered development

at any stage or in which the Company has invested in developing.

CHMC may also terminate the CHMC Agreement to the fullest extent permitted

by law in the countries of the worldwide territory, in the event the Company or its affiliates challenge or induce others set up challenges

to the validity or enforceability of any of the Licensed Patents, as defined in the CHMC Agreement, and the Company will be obligated

to reimburse CHMC for its costs, including reasonable attorneys’ fees.

Oxford University Innovation Limited

In December 2018, the Company

entered into an option agreement with Oxford University Innovation (“OUI”), which was a precursor to a license agreement (the

“OUI Agreement”), dated July 16, 2019.

Under the terms of the OUI Agreement, the Company held an exclusive, worldwide license

to certain specified patent rights and biological materials relating to the use of epitopes of limited variability and virus-like particle

products and practice processes that are covered by the licensed patent rights and biological materials for the purpose of developing

and commercializing a vaccine product candidate for influenza.

The Company was obligated to use its best efforts to develop and market

Licensed Products, as defined in the OUI Agreement, in accordance with its development plan, report to OUI on progress, achieve certain

milestones and was required to pay OUI nonrefundable milestone fees when it achieved them.

Pursuant to the OUI Agreement, the Company

was obligated to pay certain milestone and royalty payments in the future, as the related contingent events occur.

Specifically, the Company

was obligated to pay a 6 % royalty on all net sales of licensed products, as defined in the OUI Agreement, with an annual minimum royalty

payment of $ 250,000 starting post-product launch, until the expiration of the OUI Agreement or revocation of the last valid claim covering

a licensed product, at which point a royalty rate of 3 % will apply.

An annual maintenance fee of $ 10,000 and $ 20,000 was required in the

pre-phase III year and Phase III year, respectively, and as defined in the OUI Agreement.

The Company was also obligated to pay a 25 %

royalty on any sums received by the Company from any sublicensee (including all up-front, milestone and other one-off payments received

by the Company from any sub-licenses or other contracts granted by the Company with respect to the licensed technology).

the Company was required to pay OUI milestone payments of up to an aggregate of $ 51.25 million;

specifically, upon the achievement of

specified development milestones of approximately $ 2.25 million, regulatory milestones of approximately $ 9.5 million, and commercial milestones

of approximately $ 39.5 million.

Laboratory Corporation of America

On March 23, 2023, Proteomedix

entered into a license agreement with LabCorp, pursuant to which LabCorp has the exclusive right to develop and commercialize Proclarix,

and other products developed by LabCorp using Proteomedix’s intellectual property covered by the license, in the United States (“Licensed

In consideration for granting LabCorp an exclusive license, Proteomedix received an initial license fee of in the mid-six

figures upon signing of the contract.

Additionally, Proteomedix is entitled to royalty payments of between 5 % and 10 % on the net sales

recognized by LabCorp of any Licensed Products plus milestone payments as follows:

after the first sale of Proclarix as a laboratory developed test, LabCorp will pay an amount in the mid-six figures,

after LabCorp achieves a certain amount in the low seven figures in net sales of Licensed Products, LabCorp will pay Proteomedix an amount in the low seven figures,

after a certain amount in the mid-seven figures in net sales of Licensed Products, LabCorp will pay Proteomedix an amount in the low seven figures.

The total milestone payments available under the

terms of this contract are $ 2.5 million.

An additional $ 0.5 million was paid to Proteomedix as an initial license fee in 2023.

LabCorp is wholly responsible for the cost, if

any, of research, development and commercialization of Licensed Products in the United States but has the right to offset a portion of

those costs against future royalty and milestone payments.

Additionally, LabCorp may deduct royalties or other payments made to third

parties related to the manufacture or sale of Licensed Products up to a maximum amount of any royalty payments due to Proteomedix.

was no such activity under the agreement for the year ended December 31, 2024.

The license agreement and related royalty payment

provisions expire during 2038, which approximates the expiration of the last patent covered by the license agreement.

LabCorp has the

right to terminate the license agreement for any reason by providing 90 days written notice to Proteomedix.

Either party may terminate

the license agreement due to a material reach of the terms of the license agreement with 40 days’ notice, provided such breach is

not cure within the foregoing 30-day period.

Finally, Proteomedix may terminate the license agreement with 60 days’ notice in the

event LabCorp fails to make any undisputed payment due, provided that LabCorp does not remit the payment within the foregoing 60-day period.

As of December 31, 2024, the sale of Licensed

Products by LabCorp under the license agreement has not commenced.

The Company has sold product to LabCorp for their use in internal trials

Note 7 — Notes Payable

Veru Notes Payable

In connection with the Veru APA (see Note 5),

the Company executed three non-interest bearing notes payable (the “Notes”) in the principal amounts of $ 4.0 million, $ 5.0

million and $ 5.0 million with initial maturity dates of September 30, 2023 , April 19, 2024 , and September 30, 2024 , respectively.

In accordance

with the Notes, no principal payments are due until maturity, however, the Company may voluntarily prepay the Notes with no penalty.

Additionally,

in an Event of Default, as defined in the Notes, the unpaid principal amount of the Notes will accrue interest at a rate of 10.0 % per

The Company imputed interest on the Notes using

an average discount rate of 8.2 % and recorded a debt discount of approximately $ 1.1 million at the issuance date.

The debt discount is

reflected as a reduction in the carrying amount of the Notes and amortized to interest expense through the respective maturity dates,

using the effective interest method.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 6 — Significant Agreements (cont.)

The OUI Agreement was to

expire upon ten (10) years from the expiration of the last patent contained in the licensed patent rights, unless terminated earlier.

Either party had the right to terminate the OUI Agreement for an uncured material breach.

The Company was able to terminate the OUI Agreement

for any reason at any time upon six months’ written notice until July 16, 2022, which was the third anniversary of the OUI Agreement.

OUI was able to terminate immediately if the Company had a petition presented for its winding-up or passed a resolution for winding up

other than for a bona fide amalgamation or reconstruction or compounds with its creditors or had a receiver or administrator appointed.

OUI could also terminate if the Company opposed or challenged the validity of any of the patents or applications in the Licensed Technology,

as defined in the OUI Agreement;

raised the claim that the know-how of the Licensed Technology was not necessary to develop and market

Licensed Products;

or in OUI’s reasonable opinion, was taking inadequate or insufficient steps to develop or market Licensed Products

and did not take any further steps that OUI requested by written notice within a reasonable time.

The Company terminated the

agreements with Oxford during the year ended December 31, 2023, and amounts due upon termination were not significant.

Jude Children’s Hospital

The Company entered into

a license agreement (the “St.

Jude Agreement”), dated January 27, 2020, and as amended on May 11, 2022 and March 22, 2023,

Jude Children’s Research Hospital (“St.

Under the terms of the St.

Jude Agreement, the Company held

an exclusive, worldwide license to certain specified patent rights and biological materials relating to the use of live attenuated streptococcus

pneumoniae and practice processes that are covered by the licensed patent rights and biological materials for the purpose of developing

and commercializing a vaccine product candidate for streptococcus pneumoniae.

The Company was obligated to pay certain milestone and royalty

payments in the future, as the related contingent events occur.

Specifically, pursuant to the terms of the St.

Jude Agreement, as amended,

the Company was obligated to make 5 % royalty payments for each licensed product(s) sold by the Company or its affiliates, based on the

net sales for the duration of the St.

Jude Agreement, and also pay 15 % of consideration received for any sublicenses.

The Company was

also required to pay an additional one-time $ 5,000 license fee, and an annual maintenance fee of $ 10,000 beginning on the first anniversary

of the Effective Date (which was waived if all of the developmental milestones scheduled for completion before such annual fee is due

have been achieved).

In addition, the Company was required to pay St.

Jude milestone payments of up to an aggregate of $ 1.9 million;

specifically,

upon the achievement of specified development milestones of $ 0.3 million, regulatory milestones of $ 0.6 million, and commercial milestones

of $ 1.0 million.

Jude Agreement was

to expire upon the expiration of the last valid claim contained in the licensed patent rights, unless terminated earlier.

was obligated to use commercially reasonable efforts to develop and commercialize the licensed product(s) and included defined development

If the Company failed to achieve the development milestones contained in the St.

Jude Agreement, and if the Company and St.

Jude failed to agree upon a mutually satisfactory revised timeline, St.

Jude had the right to terminate the St.

Jude Agreement.

party was able to terminate the St.

Jude Agreement in the event the other party (a) filed against it a petition under the Bankruptcy Act

(among other things) or (b) failed to perform or otherwise breached its obligations under the St.

Jude Agreement and did not cure such

failure or breach within sixty (60) days.

The Company was able to terminate for any reason on thirty (30) days written notice.

The Company terminated the

agreement with St.

Jude during the year ended December 31, 2023, and amounts due upon termination were not significant.

University of Texas Health Science Center at San Antonio

The Company entered into

a patent and technology license agreement (the “UT Health Agreement”), dated November 18, 2022, with the University of Texas

Health Science Center at San Antonio (“UT Health”).

Under the terms of the UT Health Agreement, the Company held an exclusive,

worldwide license (other than the excluded field of vectors, as defined in the UT Health Agreement) to certain specified patent rights

relating to the development of a live attenuated, oral Chlamydia vaccine candidate.

An initial non-refundable license fee of $ 100,000

was due upon execution of the agreement, and expensed during the year ended December 31, 2022, with subsequent annual license fees thereafter

until expiration or termination of the UT Health agreement.

Pursuant to the UT Health Agreement, the Company was obligated to pay certain

milestone and royalty payments in the future, as the related contingent events occur.

Specifically, the Company was obligated to pay UT

a single-digit royalty on net sales, being 5 % or 3 % depending on whether the product was covered by a valid claim or not, as defined in

the agreement.

The Company was also obligated to pay a 20 % royalty on any sums received by the Company from any sublicensee.

the Company was required to pay UT Health milestone payments of up to an aggregate of approximately $ 2.2 million;

specifically, upon the

achievement of specified development milestones of approximately $ 0.7 million and regulatory milestones of approximately $ 1.5 million.

Note 7 — Notes Payable (cont.)

On September 29, 2023, the Company and the note

holder entered into an amendment to the Veru APA, which provided that the $ 4.0 million note payable originally due on September 30, 2023

was deemed paid and fully satisfied upon (1) the payment to the Seller of $ 1.0 million in cash on September 29, 2023, and (2) the issuance

to the Seller by October 3, 2023 of 3,000 shares of Series A Preferred Stock of the Company (see Note 5).

In connection with the Veru

APA Amendment, the Company recorded an extinguishment loss on the note payable of approximately $ 490,000 , which represents the difference

between the fair value of the Series A Preferred Stock that was issued to settle the debt and the carrying value of the note payable as

of September 29, 2023.

Pursuant to the Veru APA Amendment, the Series A Preferred Stock would convert to common stock of the Company one

year from the date of issuance if the required stockholder approval was obtained.

The Series A Preferred Stock, which was issued to the

Seller on October 3, 2023 was initially convertible, in the aggregate, into 142,749 shares of the Company’s common stock, subject

to adjustment and certain stockholder approval limitations specified in the Certificate of Designations.

Stockholder approval was obtained

during September 2024 and therefore subsequent conversion of the Series A Preferred Stock to common stock was consummated by the Company

during the quarter ended September 30, 2024 (see Note 9).

The Company also agreed to include the shares of common stock issuable upon

conversion of the Series A Preferred Stock in the next resale registration statement filed with the SEC.

To that end, the Company registered

130,321 shares of common stock, out of the 142,749 shares issued to Veru, in a registration statement filed with the SEC on November 1,

Of the 142,749 shares issued to Veru originally, 12,428 shares were sold prior to registration.

As a result, the remaining unsold

shares of 130,321 were registered.

On April 24, 2024, the Company entered into a

forbearance agreement with Veru (the “Original Forbearance Agreement”) due to the Company’s failure to repay the principal

balance on the $ 5.0 million note payable that had a maturity date of April 19, 2024 (the “April Veru Note”).

Pursuant to the

Original Forbearance Agreement, Veru will forbear from exercising its rights and remedies under the April Veru Note as a result of this

default, until March 31, 2025 (the “April 2024 Forbearance Period”).

Interest will accrue on any unpaid principal balance

of the April Veru Note at a rate of 10 % per annum, commencing on April 20, 2024 through the date that the outstanding principal balance

under the April Veru Note is paid in full.

Any such accrued interest will become immediately due and payable upon the earlier of (i)certain

events of default under the April Veru Note or the $ 5.0 million note payable that matures on September 30, 2024 (the “September

Veru Note”), (ii) a payment default under the September Veru Note and (iii) the final payment of any principal amount payable under

the September Veru Note.

No interest was to accrue under the September Veru Note during the April 2024 Forbearance Period unless an Event

of Default (as defined in the Original Forbearance Agreement) occurs, in which case interest will accrue from and after the date on which

such default occurs.

In consideration for Veru’s entrance into

the Original Forbearance Agreement, the Company agreed to pay Veru:

● $ 50,000 of the principal due under the April Veru Note, which was paid on April 25, 2024, and up to $ 10,000 of out-of-pocket expenses incurred by Veru in connection with the Original Forbearance Agreement;

● 15 % of (i) the monthly cash receipts of Proteomedix for the licensing or sale of any products or services, (ii) monthly cash receipts of the Company or any of its subsidiaries for the sales of Proclarix anywhere in the world, and (iii) monthly cash receipts of the Company or any of its subsidiaries for milestone payments or royalties from LabCorp;

● 10 % of the net proceeds from any financing or certain asset sale, transfer or licensing transactions that are consummated prior to March 31, 2025.

The Company also agreed to a general release of

claims against Veru and its representatives arising out of or relating to any act or omission thereof prior to April 24, 2024.

The Company determined that the Original Forbearance

Agreement should be accounted for as a modification of the April Veru Note and the September Veru Note in accordance with ASC 470-50,

Debt - Modifications and Extinguishments (“ASC 470”), as the change in cash flows expected under the April Veru Note

and the September Veru Note was not substantial.

A new effective interest rate was established based on the carrying value of the original

Notes and the revised cash flows and no gain or loss was recorded.

On September 19, 2024, the Company entered into

an Amended and Restated Forbearance Agreement with Veru (the “Amended and Restated Forbearance Agreement” or “A&R

Forbearance Agreement”), which amends and restates the Original Forbearance Agreement in its entirety.

Pursuant to the A&R Forbearance

Agreement, Veru will forbear from exercising its rights under both the April Veru Note and the September Veru Note, subject to the terms

and conditions set forth below.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 6 — Significant Agreements (cont.)

The UT Health Agreement was

to expire upon the expiration of the last date of expiration or termination of the patent rights, unless terminated earlier.

UT Health Agreement, the Company had the right to terminate the UT Health Agreement for convenience, by providing 90 days’ written

notice to UT Health.

UT Health was able to terminate the UT Health Agreement in the event the Company (a) became arrears in payment due

and did not make payment within 30 days after notification from UT Health or (b) was in breach of any non-payment provision and does not

cure such breach within 60 days after notification from UT Health or (c) UT Health delivered notice to the Company of three or more actual

material breaches of the UT Health Agreement in any 12-month period or (d) in the event the Company or its affiliates initiated any proceeding

or action to challenge the validity, enforceability, or scope of any of the licensed patents.

The Company terminated the

agreement during the year ended December 31, 2023, and amounts due upon termination were not significant.

Co-development Agreement with AbVacc, Inc.

On February 1, 2023, the

Company entered into a co-development agreement (the “Co-Development Agreement”) with AbVacc, Inc.

for the purpose of conducting research aimed at co-development of specific vaccine candidates, including monkeypox and Marburg virus disease

with the potential to expand to others using the Norovirus nanoparticle platform (“Co-Development Project”), and to govern

the sharing of materials and information, as defined in the Co-Development Agreement, for the Co-Development Project.

Under the Co-Development

Agreement, AbVacc and the Company will collaborate, through a joint development committee, to establish and implement a development plan

or statement of work for each Co-Development Project targeted product.

Under the Co-Development Agreement, either the Company or

AbVacc, whichever party is the primary sponsor of any resulting product (as defined in the Co-Development Agreement), will be obligated

to compensate the other party for certain milestone payments that would range between $ 2.1 million and $ 4.75 million, plus royalties of

between 2 % to 4 %.

There is no fixed obligation for either party, and each party will be responsible for their own costs.

of the Co-Development Agreement is three years from the effective date, unless previously terminated by either party, in accordance

with the Co-Development Agreement.

During the year ended December 31, 2023, the Company incurred approximately $ 21,000 in costs for research

and development related to the Co-Development Agreement.

As of December 31, 2023, the Company evaluated the likelihood of the Company

achieving the specified milestones and generating product sales and determined that the likelihood is not yet probable and as such no

accrual of these payments is required as of December 31, 2023.

Services Agreement

On July 21, 2023, the Company,

entered into a Licensing and Services Master Agreement (“Master Services Agreement”) and a related statement of work with

a vendor, pursuant to which the vendor was to provide to the Company commercialization services for the Company’s products, including

recruiting, managing, supervising and evaluating sales personnel and providing sales-related services for such products, for fees totaling

up to $ 29.1 million over the term of the statement of work.

The statement of work had a term through September 6, 2026, unless earlier

terminated in accordance with the Master Services Agreement and the statement of work.

On July 29, 2023, a second statement of work was

entered into with the same vendor for certain subscription services providing prescription market data access to the Company.

under the second statement of work totaled approximately $ 800,000 , and the term was through July 14, 2025 .

On October 12, 2023, the Company

terminated the Master Services Agreement and the statements of work.

The Company recorded approximately $ 3.1 million in expense related

to this contract during the year ended December 31, 2023, which is included in selling, general and administrative expense in the accompanying

consolidated statements of operations and comprehensive loss.

The Company had approximately $ 1.8 million recorded in related accounts

payable as of December 31, 2023, which includes amounts due for early termination of the contract.

Note 7 — Notes Payable (cont.)

The A&R Forbearance Agreement extends the

due date for the April 2024 and September 2024 Veru Notes until the earlier to occur of (i) June 30, 2025 or (ii) the occurrence of any

Event of Default.

The Amended and Restated Forbearance Agreement also effected certain modifications to the payment terms in the Original

Forbearance Agreement and amended certain terms of the September Veru Note as summarized below.

Pursuant to the A&R Forbearance Agreement,

the Company agreed to make the following required payments (the “Required Payments”) during the April 2024 Forbearance Period,

first to accrued and unpaid interest under the April Veru Note and then any remainder to the outstanding principal amount of the April

● Interest at the rate of 10 % per annum shall accrue on any unpaid principal balance of the April Veru Note commencing on April 20, 2024 through the date that the outstanding principal balance under the April Veru Note is paid in full;

● Monthly payments equal to 25 % (increased from 15 % in the Original Forbearance Agreement) of (i) the monthly cash receipts of Proteomedix for the licensing or sale of any products or services, (ii) monthly cash receipts of the Company or any of its subsidiaries for the sales of Proclarix anywhere in the world, and (iii) monthly cash receipts of the Company or any of its subsidiaries for milestone payments or royalties from LabCorp cash receipts of the Company or any of its subsidiaries from certain sale or licensing revenues or payments (the “Ordinary Cash Revenue”), which increased amount began October 20, 2024 for cash receipts in September 2024;

● Payment of 20 % (increased from 10 % in the Original Forbearance Agreement) of the net proceeds from certain financing or other transactions outside the ordinary course of business completed by the Company or any of its subsidiaries during the April 2024 Forbearance Period, which increased amount will begin for any net proceeds received after September 19, 2024;

The remaining balance of the April Veru Note will be due at the end of the April 2024 Forbearance Period.

and Veru also agreed to the following amendments to the September Veru Note in the A&R Forbearance Agreement:

As noted above, an extension of the maturity date to June 30, 2025;

● The accrual of interest at the rate of 10 % per annum on any unpaid principal balance of the September Veru Note commencing on October 1, 2024 through the date that the outstanding principal balance under the September Veru Note is paid in full;

Any amounts owed on the September Veru Note, including but not limited to unpaid principal and accrued interest, will be paid in cash or, upon the mutual written consent of Veru and the Company, in shares of the Company’s Common Stock or a combination of cash and the Company’s Common Stock;

Following full repayment of all principal and interest under the April Veru Note, the Company will make the Required Payments first towards accrued and unpaid interest under the September Veru Note and then towards the remaining principal balance payable under the September Veru Note;

● If the aggregate unpaid principal outstanding under the April Veru Note and the September Veru Note and all accrued and unpaid interest thereon is repaid in cash on or before December 31, 2024, then the total principal balance under the September Veru Note that will be payable by the Company in satisfaction of its obligations under the September Veru Note will be reduced from $ 5.0 million to $ 3.5 million.

The Company determined the A&R Forbearance

Agreement should be accounted for as a modification of both the April and September Veru Notes in accordance with ASC 470-50, Debt

- Modifications and Extinguishments (“ASC 470”), as the change in cash flows expected under the April Veru Note and the

September Veru Note was not substantial.

A new effective interest rate was established based on the carrying value of the original Notes

and the revised cash flows and no gain or loss was recorded.

On November 26, 2024, the Company entered into

another Amended and Restated Forbearance Agreement with Veru (the “November Amended and Restated Forbearance Agreement” or

“November A&R Forbearance Agreement”), which amends and restates certain terms of the Amended and Restated Forbearance

Pursuant to the November A&R Forbearance Agreement, Veru agreed to waive the due date for payment of applicable Cash Receipt

Payments (as such term is defined in the A&R Forbearance Agreement) generated in October 2024 until the Company receives funds of

at least $ 97,000 pursuant to its equity line of credit facility with Keystone Capital Partners LLC.

In exchange, the Company agreed to

increase its payments to be made to Veru out of future financing and strategic transactions through June 30, 2025, from 20 % to 25 % of

net proceeds generated from such transactions.

All other terms of the A&R Forbearance Agreement with Veru remain the same.

has evaluated and concluded that there is no accounting impact from the A&R Forbearance Agreement with Veru.

During the year ended December 31, 2024 and 2023,

the Company recorded approximately $ 1.4 million and $ 0.7 million of associated interest expense, respectively, which includes accrued

interest and amortization of the debt discount.

The unamortized debt discount as of December 31, 2024 and 2023 was $ 5,000 and $ 0.4 million.

As of December 31, 2024, the Company has recorded accrued interest of approximately $ 0.1 million on the Notes, which is included in accrued

expenses in the accompanying consolidated balance sheets.

Future minimum principal payments on the Notes

as of December 31, 2024 include $ 4.3 million in principal payments that are due in March 2025 and $ 5.0 million principal payments that

are due in June 2025.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 6 — Significant Agreements (cont.)

Laboratory Corporation of America

March 23, 2023, Proteomedix entered into a license agreement Laboratory Corporation of America (“Labcorp”) pursuant to which

Labcorp has the exclusive right to develop and commercialize Proclarix, and other products developed by Labcorp using Proteomedix’s

intellectual property covered by the license, in the United States (“Licensed Products”).

In consideration for granting Labcorp

an exclusive license, Proteomedix received an initial license fee of in the mid-six figures upon signing of the contract.

Note 7 — Notes Payable (cont.)

Related Party Debenture

On January 23, 2024, the Company issued a non-convertible

debenture (the “Debenture”) to the PMX Investor, a related party, in the principal sum of $ 5.0 million, in connection with

the Subscription Agreement discussed in Note 8.

The Debenture has an interest rate of 4.0 % per annum, and the principal and accrued interest

was originally payable in full upon the earlier of (i) the closing under the Subscription Agreement and (ii) June 30, 2024.

Additionally,

Proteomedix is entitled to royalty payments on the net sales recognized by Labcorp of any Licensed Products plus milestone payments as

● After the first sale of Proclarix as a laboratory developed test, Labcorp will pay an amount in the mid-six figures,

Labcorp achieves a certain amount in the low seven figures in net sales of Licensed Products, Labcorp will pay Proteomedix an amount

in the low seven figures,

a certain amount in the mid-seven figures in net sales of Licensed Products, Labcorp will pay Proteomedix an amount in the low seven

is wholly responsible for the cost, if any, of research, development and commercialization of Licensed Products in the United States

but has the right to offset a portion of those costs against future royalty and milestone payments.

Additionally, Labcorp may deduct

royalties or other payments made to third parties related to the manufacture or sale of Licensed Products up to a maximum amount of any

royalty payments due to Proteomedix.

Note 7 — Notes Payable

In connection with the Veru

APA (see Note 5), the Company executed three non-interest bearing notes payable (the “Notes”) in the principal amounts of

$ 4.0 million, $ 5.0 million and $ 5.0 million with maturity dates of September 30, 2023, April 19, 2024 , and September 30, 2024 , respectively.

No principal payments are due until maturity;

however, the Company may voluntarily prepay the Notes with no penalty.

Additionally, in

an Event of Default, as defined in the Notes, the unpaid principal amount of the Notes will accrue interest at a rate of 10.0 % per annum.

The Company imputed interest on the Notes using an average discount

rate of 8.2 % and recorded a debt discount of approximately $ 1.1 million at the issuance date.

The debt discount is reflected as a reduction

in the carrying amount of the Notes and amortized to interest expense through the respective maturity dates, using the effective interest

The Company recorded approximately $ 0.7 million of associated interest expense during the year ended December 31, 2023.

The unamortized

debt discount as of December 31, 2023 was approximately $ 0.4 million.

On September 29, 2023, the

Company and the note holder entered into an amendment to the Veru APA, which provided that the $ 4.0 million note payable originally due

on September 30, 2023 was deemed paid and fully satisfied upon (1) the payment to the Seller of $ 1.0 million in cash on September 29,

2023, and (2) the issuance to the Seller by October 3, 2023 of 3,000 shares of Series A Preferred Stock of the Company (see Note 5).

connection with the Veru APA Amendment, the Company recorded an extinguishment loss on the note payable of approximately $ 490,000 , which

represents the difference between the fair value of the Series A Preferred Stock that was issued to settle the debt and the carrying value

of the note payable as of September 29, 2023.

The extinguishment loss is recognized in other income (expense) in the accompanying consolidated

statements of operations and comprehensive loss for the year ended December 31, 2023.

To determine the fair value

of the Series A Preferred Stock, the Company first derived the business enterprise value (“BEV”) using a discounted cash flow

The BEV was adjusted to an equity value assuming $ 3.0 million of debt converted to Series A Preferred Stock, which was then

allocated across the Company’s securities.

The concluded value for the Series A Preferred Stock utilized the Black-Scholes option

pricing model, which was classified as level 3 in the valuation hierarchy due to the presence of significant unobservable inputs.

following key assumptions were used in the model:

volatility rate of 100 %, risk free interest rate of 4.6 %, 5.0 year expected

term, and the Company’s aggregate equity value.

The volatility was based on the historical and implied volatility of a peer group

and the risk-free interest rate was based on the implied yield available on U.S.

Treasury securities with a term commensurate with the

estimated expected term.

Future minimum principal

payments on the Notes as of December 31, 2023, includes $ 10 million in principal payments that are due in 2024 .

The Company also assumed

an obligation in the amount of 100,000 CHF, in connection with the Proteomedix acquisition.

This obligation relates to a loan from an

investor that was advanced to Proteomedix in March 2010.

This loan bears no interest, is unsecured and may be cancelled by the Company

at its discretion, however it is the intent of the Company to repay this loan in the future.

The loan payable, in the amount of approximately

$ 119 ,000, is included in long term note payable in the accompanying consolidated balances sheet as of December 31, 2023.

the $ 5.0 million subscription amount under the Subscription Agreement shall be increased by the amount of interest payable under the Debenture.

On April 24, 2024, the maturity date of the related

party debenture was extended to October 31, 2024, through the execution of an extension agreement (the “Extension Agreement”)

between the Company and the PMX investor.

No other terms of the Debenture were modified in connection with the Extension Agreement.

The Company considered the guidance of ASC 470-60,

Troubled Debt Restructuring by Debtors , and concluded that the Extension Agreement should be accounted for as a troubled debt restructuring

as the Company is experiencing financial difficulty and since the effective borrowing rate under the Extension Agreement is less than

the effective borrowing rate under the original agreement, which indicates that a concession is deemed to have been granted.

not result in a gain on restructuring as the future undiscounted cash outflows required under the Extension Agreement exceed the carrying

value of the Debenture immediately prior to the extension.

A new effective rate was established based on the carrying value of the original

Debenture and the revised cash flows.

In connection with the issuance of the Debenture,

the Company incurred approximately $ 0.4 million in financing fees, which was recorded as a debt discount, and reflected as a reduction

in the carrying amount of the Debenture.

The debt discount is being amortized to interest expense through the maturity date.

did not incur any financing fees in connection with the Extension Agreement.

On September 24, 2024, the Company converted all

unpaid principal and accrued interest due under the Debenture into 500,000 units, attributable to principal, and 13,424 units, attributable

to accrued interest, upon the closing of the Subscription Agreement.

Each unit consisted of 1 share of common stock and 0.30 pre-funded

warrants at an exercise price of $ 0.04 per share.

As a result of the transaction, 513,424 shares of common stock were issued, and 154,027

pre-funded warrants were issued.

As of December 31, 2024, there is no outstanding balance or accrued interest remaining on the Debenture.

The remaining unamortized debt discount was immediately expensed upon settlement.

The Company recorded approximately $ 0.5 million

of interest expense on the Debenture during the year ended December 31, 2024, respectively, which includes accrued interest and amortization

of the debt discount.

Insurance Financing

During the year ended December 31, 2024, the Company

obtained financing for certain Director & Officer liability insurance policy premiums.

The agreement assigns the lender a first priority

lien on and security interest in the financed policies and any additional premium required in the financed policies.

The total premiums, taxes and fees financed are

approximately $ 0.7 million, with an annual interest rate of 7.79 %.

In consideration of the premium payment by the lender to

the insurance companies or the agent or broker, the Company unconditionally promised to pay the lender the amount financed plus interest

and other charges permitted under the agreement.

As of December 31, 2024, the company had paid off the insurance financing note payable.

The Company paid the insurance financing through monthly installment payments of approximately $ 78,000 , the last payment for the note

was paid on November 17, 2024 .

PMX Note Payable

The Company also assumed an obligation in the

amount of 100,000 CHF, in connection with the Proteomedix acquisition.

This obligation relates to a loan from an investor that was advanced

to Proteomedix in March 2010.

This loan bears no interest, is unsecured and may be cancelled by the Company at its discretion.

was terminated in the fourth quarter of 2024.

The long term note payable has no outstanding balance as of December 31, 2024.

ONCONETIX, INC.

1 unchanged sentence

Note 8 — Subscription Agreement

On December 18, 2023, the Company entered into a subscription agreement

(the “Subscription Agreement”) with the PMX Investor, who became a stockholder of Onconetix at the closing of the PMX Transaction

(see Notes 5 and 11) for the sale of 20 million units, each comprised of 1 share of common stock and 0.30 pre-funded warrants (the “Units”)

at $ 0.25 per Unit.

The Subscription Agreement includes a make-whole provision which requires the issuance of additional shares of common

stock in the event that the 270-day volume weighted average price (“270 VWAP”) after the closing of the Subscription Agreement,

is below $ 0.25 .

The Subscription Agreement will only close upon obtaining Stockholder Approval for certain transactions involving the

Company’s Series B Preferred Stock, as further described in Note 5.

The Subscription Agreement

is accounted for as a liability in accordance with ASC 480, as the make-whole provision could result in a variable number of shares being

issued upon settlement.

The subscription agreement liability is measured at fair value at the commitment date and at each subsequent reporting

period, with changes in fair value recorded as a component of other income (expense), net in the consolidated statements of operations

and comprehensive loss.

The Company recorded the fair value of the Subscription Agreement liability at the issuance date of approximately

$ 0.8 million, as an acquisition related cost, as the Subscription Agreement was a condition to close the PMX Transaction (see Note 5).

As of December 31, 2023, the fair value of the subscription agreement liability is estimated to be approximately $ 0.9 million, determined

using a Monte-Carlo option pricing model, and the Company estimated a 55.0 % probability that the Subscription Agreement will close.

significant assumptions used in the Monte-Carlo model, which utilizes Level 3 inputs (see Note 3), are as follows as of the commitment

date and at December 31, 2023:

On December 18, 2023, the Company entered into

a subscription agreement (the “Subscription Agreement”) with the PMX Investor, who became a stockholder of Onconetix at the

closing of the PMX Transaction (see Notes 5 and 11), for the sale of 500,000 units, each comprised of 1 share of common stock and 0.30

pre-funded warrants (the “Units”) at $ 10 per Unit.

The Subscription Agreement includes a make-whole provision which requires

the issuance of additional shares of common stock in the event that the 270-day volume weighted average price after the closing of the

Subscription Agreement, is below $ 10 , and the PMX Investor still holds the common shares acquired upon closing of the Subscription Agreement

270 days after such closing.

The Subscription Agreement would only close upon obtaining Stockholder Approval for certain transactions

involving the Company’s Series B Preferred Stock, as further described in Note 5.

The Subscription Agreement was amended on January

23, 2024 to include a provision for interest on the $ 5 million debenture, accruing at a rate of 4 %, to be included in the calculation

of the units to be issued upon the Conversion.

Stockholder approval was obtained on September 5, 2024, and as a result, the Conversion

and the issuance of 500,000 units, attributable to the Subscription Agreement, and 13,424 units, attributable to additional accrued interest

under the debenture to the PMX Investor took place on September 24, 2024.

Due to the issuance, the make-whole took effect and remains

in place until June 24, 2025.

The Subscription Agreement is accounted for as

a liability in accordance with ASC 480, Distinguishing Liabilities from Equity , (“ASC 480”), as the make-whole provision

could result in a variable number of shares being issued upon settlement.

The related party subscription agreement liability is measured

at fair value at the commitment date and at each subsequent reporting period, with changes in fair value recorded as a component of other

income (expense), net in the consolidated statements of operations and comprehensive loss.

As of December 31, 2024 and December 31, 2023,

the fair value of the related party subscription agreement liability is estimated to be approximately $ 4,123,000 and $ 864,000 , respectively,

and the change in fair value of the related party subscription agreement liability for the year ended December 31, 2024 was an increase

of approximately $ 3,259,000 .

The fair value was determined using a Monte-Carlo option pricing model, and as of December 31, 2024 and 2023,

the Company utilized 100 % and 55 % probability, respectively, that the Subscription Agreement will close.

The significant assumptions used

in the Monte-Carlo model, which utilizes Level 3 inputs (see Note 3), are as follows as of December 31, 2024 and 2023:

Exercise price

3 unchanged sentences

Authorized Capital

As of December 31, 2023 and

2022, the Company is authorized to issue 250,000,000 shares and 10,000,000 shares of common stock and preferred stock, respectively, with

a par value of $ 0.00001 for both common stock and preferred stock.

As of December 31, 2023, the Company had designated and authorized

the issuance of up to 1,150,000 shares, 10,000 shares, and 2,700,000 shares of Series Seed Preferred Stock, Series A Preferred Stock,

and Series B Preferred Stock, respectively.

On February 23, 2022, in

connection with the closing of the IPO, the Company filed with the Secretary of State of the State of Delaware an amended and restated

certificate of incorporation (the “A&R COI”), which became effective immediately.

There was no change to the Company’s

authorized shares of common stock and preferred stock or the par value.

Prior to this amendment, the Company had designated 1,150,000

shares of preferred stock, with par value $ 0.00001 per share.

In addition, on February 23, 2022 and in connection with the closing of

the IPO, the Company’s board of directors adopted Amended and Restated Bylaws.

As of December 31, 2024 and 2023, the Company

is authorized to issue 250,000,000 shares and 10,000,000 shares of common stock and preferred stock, respectively, with a par value of

$ 0.00001 for both common stock and preferred stock.

At December 31, 2024, the Company had designated 1,150,000 shares,

10,000 shares, 2,700,000 shares, and 10,000 shares of Series Seed Preferred Stock, Series A Preferred Stock, Series B Preferred Stock

and Series C Preferred Stock, respectively.

At December 31, 2023, the Company had designated and authorized the

issuance of up to 1,150,000 shares, 10,000 shares, 2,700,000 shares, and 0 shares of Series Seed Preferred Stock, Series A Preferred Stock,

Series B Preferred Stock and Series C Preferred Stock, respectively.

Preferred Stock

Series A Convertible Preferred Stock

On September 29, 2023, the

Company filed a Certificate of Designations of Rights and Preferences of Series A Preferred Stock of the Company (the “Series A

Certificate of Designations”) with the State of Delaware to designate and authorize the issuance of up to 10,000 shares of Series

A Preferred Stock.

On October 3, 2023, the Company

issued 3,000 shares of Series A Convertible Preferred Stock in exchange for the settlement of $ 3.0 million in notes payable due to Veru,

(see Notes 5 and 7).

The significant terms of the Series A Preferred Stock are as follows:

shares of Series A Preferred Stock carry no voting rights, except as to certain significant matters specified in the Series A Certificate

of Designations.

Series Seed Convertible Preferred Stock

The Company has 1,150,000 shares of preferred

stock designated as Series Seed Preferred Stock (“Series Seed”) and there are no shares of Series Seed outstanding as of December

31, 2024 and 2023.

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

- Onconetix shall have the right to redeem in cash any outstanding shares of Series A Preferred Stock along with accrued but unpaid

dividends beginning immediately after issuance of such shares of Preferred Stock.

holder of the Series A Preferred Stock shall not under any circumstances have any right to require redemption.

Liquidation Preference

- Each share of Series A Preferred Stock will have a liquidation preference equal to the stated value (initially $ 1,000 per share),

plus any accrued but unpaid dividends thereon (the “Liquidation Preference”).

In the event of a liquidation, dissolution or

winding up of the Company (which shall include any merger, reorganization, sale of assets in which control of Onconetix is transferred

or event which results in all or substantially all of the Company’s assets being transferred), the holders of the Series A Preferred

Stock shall be entitled to receive out of the assets of the Company, before any payment is made to the holders of common stock and either

in preference to or pari pasu with the holders of any other series of preferred stock that may be issued in the future, a per share amount

equal to the Liquidation Preference.

Any remaining assets of the Company following payment of the Liquidation Preference to the holders

of Series A Preferred Stock shall be distributed to the holders of the Corporation’s common stock and any junior series of preferred

stock then outstanding.

Dividends - The holders

of Series A Preferred Stock shall be entitled to receive dividends on shares of Series A Preferred Stock (on an as-if-converted-to-common-stock

basis) equal 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 stock.

No other dividends shall be paid on shares of Series A Preferred Stock.

Conversion - Each

share of Series A Preferred Stock shall automatically convert into common stock of the Company one year from the date of issuance, if

the required stockholder approval is obtained.

If this approval is not obtained, then the Series A Preferred Stock is convertible, at

the option of the holder, at any time and from time to time from and after one year from the date of issuance into that number of shares

of common stock (subject to certain limitations) determined by dividing the Stated Value by the Conversion Price.

If the required vote

discussed above is not obtained, and the Series A Preferred Stock is converted at the option of the holder, the Company may not issue

a number of shares of common stock which, would exceed 19.99 % shares of common stock (subject to adjustment for forward and reverse stock

splits, recapitalizations and the like).

The Conversion Price, which is subject to adjustment in the event of any stock dividend, stock

split, combination or other similar recapitalization and other adjustments, as defined in the Series A Certificate of Designations, is

initially $ 0.5254 .

The maximum number of shares that the Series A Preferred Stock is convertible

into, based on the Conversion Price as of December 31, 2023 is approximately 5,709,935 shares

of the Company’s common stock.

The Company evaluated the

terms of the Series A Preferred Stock, and in accordance with the guidance of ASC 480, the Series A Preferred Stock is classified as permanent

equity in the accompanying consolidated balance sheet.

The Series A Preferred Stock was recorded at its fair value as of the issuance

date (see Note 7).

Series A Convertible Preferred Stock

On September 29, 2023, the Company filed a Certificate

of Designations of Rights and Preferences of Series A Preferred Stock of the Company (the “Series A Certificate of Designations”)

with the State of Delaware to designate and authorize the issuance of up to 10,000 shares of Series A Preferred Stock.

On October 3, 2023, the Company issued 3,000 shares

of Series A Convertible Preferred Stock in exchange for the settlement of $ 3.0 million in notes payable due to Veru, Inc.

On September 24, 2024, Veru converted all 3,000

shares of Series A Convertible Preferred Stock into 142,749 shares of the Company’s common stock per the stated conversion ratio.

There were 0 and 3,000 shares of Series A Convertible Stock outstanding as of December 31, 2024 and 2023, respectively.

Series B Convertible Preferred Stock

On December 15, 2023, the

Company filed a Certificate of Designations of Rights and Preferences of Series B Convertible Preferred Stock of the Company (the “Series

B Certificate of Designations”) with the State of Delaware to designate and authorize the issuance of up to 2,700,000 shares

of Series B Preferred Stock.

On December 15, 2023, in

connection with the PMX Transaction, as part of the purchase consideration, the Company issued 2,696,729

shares of Series B Convertible Preferred Stock (see Note 5).

The significant terms of the Series B Preferred Stock are as follows:

Voting - The shares

of Series B Preferred Stock carry no voting rights except with respect to the election

of the Proteomedix Director (as defined in the Certificate of Designations) and except as to certain significant matters specified in

the Series B Certificate of Designations.

On December 15, 2023, the Company filed a Certificate

of Designations of Rights and Preferences of Series B Convertible Preferred Stock of the Company (the “Series B Certificate of Designations”)

with the State of Delaware to designate and authorize the issuance of up to 2,700,000 shares of Series B Preferred Stock.

On December 15, 2023, in connection with the PMX

Transaction, as part of the purchase consideration, the Company issued 2,696,729 shares of Series B Convertible Preferred Stock (see Note

The Series B Preferred Stock was initially convertible into approximately 6,741,820 shares of the Company’s common stock,

upon Stockholder Approval as defined in the Series B Certificate of Designation.

The Company evaluated the terms of the Series

B Preferred Stock, and in accordance with the guidance of ASC 480, the Series B Preferred Stock was classified as temporary equity in

the accompanying consolidated balance sheets, as the shares may be redeemable by the holders for cash, upon certain conditions that are

not within the control of the Company.

Additionally, the Company does not control the actions or events necessary to deliver the number

of required shares upon exercise by the holders of the conversion feature.

The Series B Preferred Stock was recorded at its fair value

as of the issuance date (see Note 5).

The Series B Preferred Stock was not previously redeemable or probable of becoming redeemable because

it was subject to, among other things, Stockholder Approval as described above, and therefore the carrying amount was not accreted to

its redemption value in prior periods.

On September 5, 2024, Stockholder Approval was

obtained, and on September 24, 2024, the Company effected the conversion of all 2,696,729 shares of Series B Preferred Stock into 6,741,820

shares of the Company’s common stock.

Series C Convertible Preferred Sock

On October 1, 2024, the Board of Directors authorized

the Company to create a series of 10,000 shares of preferred stock designated as “Series C Convertible Preferred Stock”, with

a par value of $ 0.00001 , pursuant to the certificate of designations.

At any time after the initial issuance date of Series C convertible

Preferred Stock, each Preferred Share shall be convertible into validly issued, fully paid and non-assessable shares of Common Stock.

The holders of Series C Preferred Stock are entitled to dividends, on an as-if converted basis, equal to and in the same form as dividends

actually paid on shares of Common Stock, when and if actually paid.

In addition, from and after the occurrence and during the continuance

of any Triggering Event, dividends (“Default Dividends”) will accrue on the Stated Value of each Preferred Share at a rate

of fifteen percent ( 15.0 %) (the “Default Rate”) per annum.

Each holder is entitled to convert any portion of the outstanding

Preferred Shares held by such holder into validly issued, fully paid and non-assessable Conversion shares at the Conversion Rate, which

can be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion Price, $ 4.5056 , subject to adjustment

as provided in the Certificate of Designations.

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

Liquidation Preference

- Upon a liquidation, dissolution or winding-up of Onconetix, whether voluntary or involuntary, the holders of Series B Preferred

Stock shall be entitled to receive out of the assets, whether capital or surplus, of Onconetix, the same amount that a holder of common

stock would receive if such holder’s Series B Preferred Stock were fully converted to common stock at the effective conversion ratio,

plus an additional amount equal to any dividends declared but unpaid to such shares, which amounts shall be paid pari passu with

all holders of common stock.

Dividends - The holders

of the Series B Preferred Stock shall be entitled to receive dividends on shares of Series B Preferred Stock (on an as-if-converted-to-common-stock

basis) equal to and in the same form, and in the same manner, as dividends (other than dividends on shares of the common stock payable

in the form of common stock) actually paid on shares of the common stock when, as and if such dividends (other than dividends payable

in the form of common stock) are paid on shares of the common stock.

Conversion - Following

Stockholder Approval, each share of Series B Preferred Stock shall be converted into shares of common stock (the “Conversion Shares”)

at a ratio of 100 Conversion Shares for each share of Series B Preferred Stock (the “Conversion Ratio”).

All shares of Series

B Preferred Stock shall automatically and without any further action required be converted into Conversion Shares at the Conversion Ratio

upon the latest date on which (i) Onconetix has received the Stockholder Approval with respect to the issuance of all of the shares of

Common Stock issuable upon Conversion in excess of 20 % of the issued and outstanding Common Stock on the Closing Date and (ii) Onconetix

has effected an increase in the number of shares of Common Stock authorized under its certificate of incorporation, to the extent required

to consummate the PMX Transaction.

The Conversion ratio is subject to adjustment in the event of any stock dividend, stock split, combination

or other similar recapitalization and other adjustments, as defined in the Series B Certificate of Designations The

Series B Preferred Stock is initially convertible into approximately 269,672,900 shares of the Company’s common stock.

Cash Settlement - If,

at any time after the earlier of the date of the Stockholder Approval or January 1, 2025 (the earliest such date, Onconetix (x) has

obtained the Stockholder Approval but fails to deliver certificates representing the Conversion Shares, or other documentation as required

under the terms of the Share Exchange Agreement, or (y) has failed to obtain the Stockholder Approval, Onconetix shall, at the request

of the holder, pay to such holder an amount in cash equal to (i) the Fair Value (as defined below) of the shares of Series B Preferred

Stock set forth in such request multiplied by (ii) the Conversion Ratio in effect on the trading day on which the request is delivered

to Onconetix.

“Fair Value” of shares shall be fixed with reference to the last reported closing stock price on the principal

trading market of the Common Stock on which the Common Stock is listed as of the trading day on which the request is delivered to Onconetix.

Redemption - The shares

of Series B Preferred Stock are not redeemable by Onconetix.

The Company evaluated the

terms of the Series B Preferred Stock, and in accordance with the guidance of ASC 480, the Series B Preferred Stock is classified as temporary

equity in the accompanying consolidated balance sheet, as the shares may be redeemable by the holders for cash, upon certain conditions

that are not within the control of the Company.

Additionally, the Company does not control the actions or events necessary to deliver

the number of required shares upon exercise by the holders of the conversion feature.

The Series B Preferred Stock was recorded at its

fair value as of the issuance date (see Note 5).

The Series B Preferred Stock is not currently redeemable or probable of becoming redeemable

because it is subject to, among other things, Stockholder Approval as described above, and therefore the carrying amount is not currently

accreted to its redemption value as of December 31, 2023.

Series Seed Convertible Preferred Stock

The Company has 1,150,000

shares of preferred stock designated as Series Seed Preferred Stock (“Series Seed”) and there are no shares of Series Seed

outstanding as of December 31, 2023 and 2022.

Prior to the closing of the

IPO in 2022, there were 1,146,138 shares of Series Seed issued and outstanding.

Each share of the Series Seed was convertible, at the

option of the holder, at a conversion price of $ 1.52 per share, subject to certain adjustments.

The holders of the Series Seed were entitled

to receive cumulative dividends at a per share rate of 8 % per annum, compounded annually.

Each Series Seed share was automatically convertible

into common stock of the Company, at the then-effective conversion price, upon the closing of a firmly underwritten public offering netting

proceeds of at least $ 50 million with an offering price of at least three hundred percent ( 300 %) of the Original Issue Price of the Series

On February 18, 2022, the majority of the holders of the Series Seed approved the automatic conversion of the outstanding shares

of the Series Seed and all related accrued and unpaid dividends, upon the closing of the IPO.

The number of shares of Common Stock to

be issued upon the closing of the IPO pursuant to the conversion were to be calculated in accordance with the original conversion terms

provided by the Company’s Amended and Restated Certificate of Incorporation (“COI”) dated July 1, 2019.

This conversion

occurred on February 23, 2022, upon the closing of the Company’s IPO.

Also, upon the close of the IPO, aggregate cumulative dividends

of $ 1,586,162 , or $ 1.38 per Series Seed share, were automatically converted into shares of common stock.

There were an aggregate of 5,626,365

shares of common stock issued upon conversion of the Series Seed shares and cumulative dividends as of the close of the IPO.

After the Stockholder Approval Date, if a Triggering

Event occurs and is continuing at any time after the earlier of the holders’ receipt of a Triggering Event Notice and such holder

becoming aware of such Triggering Event (such earlier date, the “Alternate Conversion Right Commencement Date”) and ending

on the twentieth (20 th ) Trading Day after the later of (x) the date of such Triggering Event is cured and (y) such holder’s

receipt of a Triggering Event Notice (such ending date, the “Alternate Conversion Right Expiration Date”), and each such period,

an “Alternate Conversion Right Period”), such holder may, at such holder’s option, by delivery of a Conversion Notice

to the Company (the date of any such Conversion Notice, each an “Alternate Conversion Date”), convert all, or any number of

Preferred Shares held by such holder into shares of Common Stock at the Alternate Conversion Price (each, an “Alternate Conversion”).

Alternate Conversion Price means, with respect to any Alternate Conversion that price will be the lowest of (i) the applicable Conversion

Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, and (ii) the greater of (x) the Floor Price

and (y) 80% of the lowest VWAP of the Common Stock during the five (5) consecutive Trading Day period ending and including the Trading

Day immediately preceding the delivery or deemed delivery of the applicable Conversion Notice (such period, the “Alternate Conversion

Measuring Period”).

At any time, the Company has the right to redeem

in cash all, but not less than all, of the Preferred Shares then outstanding at a price (the “Company Optional Redemption Price”)

equal to 125% of the greater of (i) the Conversion Amount being redeemed and (ii) the product of (1) the Conversion Rate with respect

to the Conversion Amount being redeemed multiplied by (2) the greatest closing sale price of the Company’s Common Stock on any Trading

Day during the period commencing on the date immediately preceding the date the Company notifies the holders of its elections to redeem

and the date the Company makes the entire payment required.

Upon the occurrence of a Bankruptcy Triggering Event, the Company will immediately

redeem, in cash, each of the Preferred Shares then outstanding at a redemption price equal to the greater of (i) the product of (A) the

Conversion Amount to be redeemed multiplied by (B) 125% and (ii) the product of (X) the Conversion Rate with respect to the Conversion

Amount in effect immediately following the date of initial public announcement of such Bankruptcy Triggering Event multiplied by (y) the

product of (1) 125% multiplied by (2) the greatest closing sale price of the Common Stock on any Trading Day during the period commencing

on the date immediately preceding such Bankruptcy Triggering Event and ending on the date the Company pays the entire payment required.

The holders of the Series C Preferred Stock are entitled to be paid a cash amount equal to 30% of the gross proceeds in the event of any

sale of common stock under the ELOC in accordance with the terms stated below within the ELOC securities purchase agreement.

In no event may any Preferred Shares be converted

(or Warrants be exercised) and shares of Common Stock be issued to any holder if after giving effect to the issuance of shares of Common

Stock upon such conversion of the Preferred Shares (or exercise of the Warrants), the holder (together with its affiliates, if any) would

beneficially own more than 4.99 % of the outstanding shares of Common Stock, which we refer to herein as the “PIPE Blocker”.

The PIPE Blocker may be raised or lowered to any percentage not in excess of 9.99 % at the option of the applicable holder of the Preferred

Shares (or Warrants), except that any raise will only be effective upon 61-days’ prior notice to the Company.

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

As of December 31, 2023 and 2022, there were 22,841,975 and 15,724,957

shares of common stock issued, respectively, and 22,324,576 and 15,265,228 shares of common stock outstanding, respectively.

Holders of the Company’s

common stock are entitled to one vote for each share held of record, and are entitled upon liquidation of the Company to share ratably

in the net assets of the Company available for distribution after payment of all obligations of the Company and after provision has been

made with respect to each class of stock, if any, having preference over the common stock.

The shares of common stock are not redeemable

and have no preemptive or similar rights.

December 15, 2023, in connection with the Proteomedix acquisition, the Company issued 3,675,414

shares of the Company’s common stock as part of the purchase consideration (see Note 5).

On February 17, 2022, the

Company entered into an underwriting agreement (the “Underwriting Agreement”) with Boustead Securities, LLC, acting as representative

of the underwriters (“Boustead”), in relation to the Company’s IPO, pursuant to which the Company agreed to sell to

the underwriters an aggregate of 2,222,222 shares of the Company’s common stock, at a price of $ 9.00 per share.

The IPO closed on

February 23, 2022 and resulted in net proceeds to the Company, after deducting the 8 % underwriting discount, and other offering costs,

of approximately $ 17.1 million.

Pursuant to the Underwriting

Agreement, the Company issued to Boustead warrants to purchase 111,111 shares of common stock, exercisable for five years at the option

of the holder, at a per share exercise price equal to $ 10.35 .

The Company evaluated the terms of the warrants issued at the close of the

IPO and determined that they should be classified as equity instruments based upon accounting guidance provided in ASC 480 and ASC 815-40.

Since the Company determined that the warrants were equity-classified, the Company recorded the proceeds from the IPO, net of issuance

costs, within common stock at par value and the balance of the net proceeds to additional paid in capital.

During October 2022, in connection

with a settlement agreement that was entered into with Boustead, these warrants were exchanged for 93,466 shares of restricted common

stock (“the Warrant Exchange”) (see Note 10).

The Warrant Exchange was accounted for as a modification of the warrant, with

an incremental fair value of approximately $ 10,000 , which was recorded as selling, general and administrative expense in the accompanying

consolidated statements of operations and comprehensive loss.

In addition, 200,000 restricted shares of common stock were issued to Boustead

upon execution of an advisory agreement, which was entered into concurrent with the settlement agreement.

The fair value of the restricted

shares of common stock, which had no vesting provisions, was valued at $ 254,000 , and was recorded as selling, general and administrative

expense in the accompanying consolidated statements of operations and comprehensive loss.

The restricted shares of

common stock issued under the settlement and advisory agreements with Boustead was valued based on the closing trading price on the date

the agreements were executed, adjusted to reflect the effect of the restriction on the sale of the common stock.

The value of the restriction

was measured using the Black-Scholes model to measure the discount for lack of marketability, using the following assumptions:

term of 0.5 years, expected volatility of 96.36 %, risk-free interest rate of 4.09 % and dividend yield of 0.0 %.

Treasury Stock

On November 10, 2022, the

board of directors approved a stock repurchase program (the “Repurchase Program”) to allow the Company to repurchase up to

5 million shares of common stock with a maximum price of $ 1.00 per share, with discretion to management to make purchases subject to market

On November 18, 2022, the board of directors approved an increase to the maximum price to $ 2.00 per share.

There is no expiration

date for this program.

During the year ended December

31, 2023, the Company repurchased 57,670 shares of common stock, for an aggregate of approximately $ 59,000 , at an average price of $ 1.02

During the year ended December 31, 2022, the Company repurchased 459,729 shares of common stock at an average price of $ 1.23

per share, for approximately $ 0.6 million.

Shares that are repurchased are classified as treasury stock pending future use and reduce

the number of shares outstanding used in calculating earnings per share.

As of December 31, 2023, there are approximately 4.5 million

shares remaining, that can be repurchased under the Repurchase Program.

Securities Purchase Agreement and ELOC

On October 2, 2024, the Company entered into a

Securities Purchase Agreement (the “Securities Purchase Agreement”) with six institutional and accredited investors.

sold an aggregate of i) 3,499 Series C Preferred Stock, par value $ 0.00001 per share (the “Series C Redeemable Preferred

Stock”), and (ii) a warrants to purchase 591,856 shares of common stock (the “Series C PIPE Warrants”), for

aggregate cash proceeds of $ 2,000,000 .

The Warrants have an exercise price of $ 4.38 per share, subject to adjustment therein, and

expire on the third anniversary of the initial exercisability date.

The warrants issued with the Series C Redeemable Preferred Stock are

accounted for as liabilities in accordance with ASC 815.

Concurrently, on October 2, 2024, the Company

entered into a Common Stock Equity Line of Credit Purchase Agreement (the “ELOC Purchase Agreement”) with an institutional

investor, whereby the Company may sell up to $ 25,000,000 of the Company’s new issued Common Stock.

Pursuant to the ELOC Purchase

Agreement, the investor shall purchase from the Company up to the lesser of (i) $ 25.0 million in shares of our Common Stock and (ii) 1,658,525

shares, representing 19.99 % of the total number of shares of Common Stock outstanding immediately prior to the execution of the ELOC Purchase

Pursuant to the ELOC Purchase Agreement, 30 % of the gross proceeds to the Company from any sale of common stock thereunder

must be applied towards the redemption of the Series C Redeemable Preferred Stock.

Based on the terms of

the Series C Redeemable Preferred Stock and the Company’s Certificate of Designation, and in accordance with ASC 480, the Series

C Redeemable Preferred Stock is accounted for as mezzanine equity due to the contingent redemption feature upon any sale of common

stock under the ELOC Purchase Agreement.

The initial cash proceeds of $ 2,000,000 were allocated between the Series C Preferred Stock

and derivative liability warrants, with the amount initially recorded in mezzanine equity based on the guidance in ASC 815 (i.e.

of the derivative liability warrant is allocated its full fair value, and the residual is allocated to the Series C Redeemable Preferred

The derivative liability warrants were measured at fair value at inception in the amount of $ 1,138,476 and the Series C Redeemable

Preferred stock was measured at residual value of $ 861,524 .

The Series C Redeemable Preferred Stock is subsequently measured at redemption

value as they occur, with the difference between the basis per share of $ 246.22 and redemption value per share recorded as a deemed dividend

in the statements of operations.

During the year ended

December 31, 2024, the Company received proceeds of $ 935,625 and recorded approximately $ 250,000 of shareholder receivable under the ELOC

and the Company recorded a deemed divided in the amount of $ 206,404 in the statements of operations for the year ended December 31, 2024.

The Company did not have

the Series C PIPE warrant liabilities at December 31, 2023.

The following table presents information about the Company’s Series

C PIPE warrant liabilities that are measured at fair value on a recurring basis with changes in fair value presented in the statements

of operations:

Contingent warrant liabilities – Series C PIPE warrants*

* Included within contingent warrant liabilities of the accompanying

consolidated balance sheet as of December 31, 2024.

The following table presents the changes in the

fair value of the Series C PIPE warrants:

Fair value as of October 2, 2024 (inception)

Change in fair value

( 1,105,584 )

Fair value as of December 31, 2024

* Included within Change in Fair Value of Contingent Warrant

Liabilities in the accompanying consolidated statement of operations for the year ended December 31, 2024.

The following table provides quantitative information

regarding the fair value measurements for the derivative liability warrants using the Monte Carlo pricing model:

Expected annual volatility

Risk-free rate

Expected term, years

There were no transfers in or out of

Level 3 from other levels in the fair value hierarchy during the year ended December 31, 2024.

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

Private Investments in Public Equity

April 2022 Private Placement

On April 19, 2022, the Company

consummated the closing of a private placement (the “April 2022 Private Placement”), pursuant to the terms and conditions

of a securities purchase agreement, dated as of April 13, 2022.

At the closing of the April 2022 Private Placement, the Company issued

590,406 shares of common stock, pre-funded warrants to purchase an aggregate of 590,406 shares of common stock and preferred investment

options to purchase up to an aggregate of 1,180,812 shares of common stock.

The purchase price of each share of common stock together

with the associated preferred investment option was $ 6.775 , and the purchase price of each pre-funded warrant together with the associated

preferred investment option was $ 6.774 .

The aggregate net cash proceeds to the Company from the April 2022 Private Placement were approximately

$ 6.9 million, after deducting placement agent fees and other offering expenses.

The pre-funded warrants had an exercise price of $ 0.001

per share and were exercised in full on May 24, 2022.

The preferred investment options, which had an exercise price of $ 6.65 per share,

were exchanged in connection with the August 2022 Private Placement.

See August 2022 Private Placement below for further detail.

As of December 31, 2024 and 2023 there were 11,767,443

and 571,033 shares of common stock issued, respectively, and 11,754,509 and 558,099 shares of common stock outstanding, respectively.

Warrant Inducements:

July 2024 Inducement

On July 11, 2024, the Company entered into common

stock preferred investment options exercise inducement offer letters (the “Inducement Letters”) with certain holders of existing

preferred investment options to purchase shares of the Company’s common stock at the original exercise prices of $ 101.84 and $ 43.60

per share, issued on August 11, 2022 and August 2, 2023, respectively (collectively, the “Existing PIOs”), pursuant to which

the holders agreed to exercise for cash their Existing PIOs to purchase an aggregate of 186,466 shares of the Company’s common stock,

at a reduced exercise price of $ 6.00 per share, in consideration for the Company’s agreement to issue new preferred investment options

(the “Inducement PIOs”) to purchase up to an aggregate of 559,397 shares of the Company’s common stock.

Of the 559,397

PIOs issued, 186,465 have a contractual term of 5 years, while the remaining 372,932 have a contractual term of 2 years.

Aside from the

contractual terms, the Inducement PIOs have substantially the same terms as the Existing PIOs.

On July 11, 2024, the Company consummated the

transaction contemplated by the Inducement Letters upon unanimous written consent of the Board of Directors (the “Warrant Inducement”).

The Company received aggregate net proceeds of approximately $ 0.9 million from the Warrant Inducement, after deducting placement agent

fees and other offering expenses payable by the Company.

The Company agreed to file a registration statement

covering the resale of the Inducement PIO Shares issued or issuable upon the exercise of the Inducement PIOs (the “Resale Registration

Statement”) within 30 days after the date of the Inducement Letter and to use commercially reasonable efforts to cause such Resale

Registration Statement to be declared effective by the SEC within 60 days following the date of the Inducement Letter (or within 90 days

following the date of the Inducement Letter in the case of full review of the Resale Registration Statement by the SEC).

The Company engaged H.C.

Wainwright & Co.,

LLC (“Wainwright”) acted as the exclusive placement agent for the April 2022 Private Placement.

The Company agreed to pay

Wainwright a placement agent fee and management fee equal to 7.5 % and 1.0 %, respectively, of the aggregate gross proceeds from the April

2022 Private Placement and reimburse certain out-of-pocket expenses up to an aggregate of $ 85,000 .

In addition, the Company issued warrants

to Wainwright (the “April Wainwright Warrants”) to purchase up to 70,849 shares of common stock.

The Wainwright Warrants are

in substantially the same form as the preferred investment options, except that the exercise price is $ 8.46875 .

The form of the preferred

investment options is a warrant, and as such the preferred investment options, the pre-funded warrants, and the Wainwright Warrants are

collectively referred to as the “April 2022 Private Placement Warrants”.

Further, upon any exercise for cash of any preferred

investment options, the Company agreed to issue to Wainwright additional warrants to purchase the number of shares of common stock equal

to 6.0 % of the aggregate number of shares of common stock underlying the preferred investment options that have been exercised, also with

an exercise price of $ 8.46875 (the “April Contingent Warrants”).

The maximum number of April Contingent Warrants issuable

under this provision of 70,849 were exchanged in connection with the August 2022 Private Placement.

See August 2022 Private Placement

below for further detail.

The Company evaluated the

terms of the April 2022 Private Placement Warrants and determined that they should be classified as equity instruments based upon accounting

guidance provided in ASC 480 and ASC 815-40.

Since the Company determined that the April 2022 Private Placement Warrants were equity-classified,

the Company recorded the proceeds from the April 2022 Private Placement, net of issuance costs, within common stock at par value and the

balance of the net proceeds to additional paid in capital.

The Company evaluated the

terms of the April Contingent Warrants and determined that they should be classified as a liability based upon accounting guidance provided

in ASC 815-40.

Since the April Contingent Warrants are a form of compensation to Wainwright, the Company recorded the value of the liability

of approximately $ 36,000 , as a reduction of additional paid in capital, with subsequent changes in the value of the liability recorded

in other income (expense) in the accompanying consolidated statements of operations and comprehensive loss.

The Company measured the liability

upon the close of the April Private Placement using a Monte Carlo simulation, using the following significant assumptions:

expected term

of 4.0 years, expected volatility of 117.0 %, risk-free interest rate of 4.00 % and dividend yield of 0.0 %.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 9 — Convertible Redeemable Preferred Stock and Stockholders’

Equity (cont.)

August 2022 Private Placement

On August 11, 2022, the Company consummated the closing of a private

placement (the “August 2022 Private Placement”), pursuant to the terms and conditions of a securities purchase agreement,

dated as of August 9, 2022.

At the closing of the August 2022 Private Placement, the Company issued 1,350,000 shares of common stock,

pre-funded warrants to purchase an aggregate of 2,333,280 shares of common stock and preferred investment options to purchase up to an

aggregate of 4,972,428 shares of common stock.

The purchase price of each share of common stock together with the associated preferred

investment option was $ 2.715 , and the purchase price of each pre-funded warrant together with the associated preferred investment option

was $ 2.714 .

The aggregate net cash proceeds to the Company from the August 2022 Private Placement were approximately $ 8.7 million, after

deducting placement agent fees and other offering expenses.

In addition, the investors in the August 2022 Private Placement, who are the

same investors from the April 2022 Private Placement, agreed to cancel preferred investment options to purchase up to an aggregate of

1,180,812 shares of the Company’s common stock issued in April 2022.

The pre-funded warrants had an exercise price of $ 0.001 per

During 2022, an aggregate of 1,686,640 of the pre-funded warrants were exercised.

The remaining 646,640 of pre-funded warrants

were exercised during the year ended December 31, 2023.

The preferred investment options are exercisable at any time on or after August

11, 2022 through August 12, 2027, at an exercise price of $ 2.546 per share, subject to certain adjustments as defined in the agreement.

During the year ended December 31, 2023, 2,486,214 of these preferred investment options were exercised at a reduced exercise price of

$ 1.09 , in connection with the warrant inducement transaction discussed below.

As of December 31, 2023, 2,486,214 preferred investment

options are outstanding.

Wainwright acted as the exclusive

placement agent for the August 2022 Private Placement.

The Company agreed to pay Wainwright a placement agent fee and management fee equal

to 7.5 % and 1.0 %, respectively, of the aggregate gross proceeds from the August 2022 Private Placement and reimburse certain out-of-pocket

expenses up to an aggregate of $ 85,000 .

In addition, the Company issued warrants to Wainwright (the “August Wainwright Warrants”)

to purchase up to 220,997 shares of common stock.

The August Wainwright Warrants are in substantially the same form as the preferred investment

options, except that the exercise price is $ 3.3938 .

The form of the preferred investment options is a warrant, and as such the preferred

investment options, the pre-funded warrants, and the August Wainwright Warrants are collectively referred to as the “August 2022

Private Placement Warrants”.

Further, upon any exercise for cash of any preferred investment options, the Company agreed to issue

to Wainwright additional warrants to purchase the number of shares of common stock equal to 6.0 % of the aggregate number of shares of

common stock underlying the preferred investment options that have been exercised, also with an exercise price of $ 3.3938 (the “August

Contingent Warrants”).

The maximum number of August Contingent Warrants issuable under this provision is 298,346 , which includes

70,849 of April Contingent Warrants that were modified in connection with the August 2022 Private Placement.

LLC (“Wainwright”) to act as its exclusive placement agent in connection with the transactions summarized herein and paid

Wainwright a cash fee equal to 7.5 % of the gross proceeds received form the exercise of the Existing PIOs as well as a management fee

equal to 1.0 % of the gross proceeds from the exercise of the Existing PIOs.

The Company also agreed to reimburse Wainwright for its expenses

in connection with the exercise of the Existing PIOs and the issuance of the Inducement PIOS, up to $ 50,000 for fees and expenses of legal

counsel and other out-of-pocket expenses and paid Wainwright for non-accountable expenses in the amount of $ 35,000 .

The Company also issued

to Wainwright or its designees warrants (the “Placement Agent Warrants”), and as such shares of common stock issuable thereunder,

(the “Placement Agent Warrant Shares”) to purchase (i) 13,054 shares of common stock which have the same terms as the Inducement

PIOs except for an exercise price equal to $ 7.50 per share and a term of five (5) years following the date of stockholder approval and

(ii) upon any exercise for cash of the Inducement PIOs, 7.5 % of the aggregate exercise price and that number of shares of common stock

equal to 7.0 % of the aggregate number of such shares of common stock underlying the Inducement PIOs that have not been exercised, which

will have substantially the same terms as the Placement Agent Warrants.

The Company evaluated the terms of the Inducement

PIOs and the Wainwright Inducement Warrants (collectively, the “August 2023 Inducement Warrants”), and determined that they

should be classified as equity instruments based upon accounting guidance provided in ASC 480 and ASC 815-40.

The Warrant Inducement, which resulted in the

lowering of the exercise price of the Existing PIOs and the issuance of the Inducement PIOs, is considered a modification of the Existing

PIOs under the guidance of Accounting Standards Update (“ASU”) No.

2021-04, Issuer’s Accounting for Certain Modifications

or Exchanges of Equity Classified Written Call Options .

The modification is consistent with the “Equity Issuance” classification

under that guidance as the reason for the modification was to induce the holders of the Existing PIOs to cash exercise their warrants,

resulting in the imminent exercise of the Existing PIOs, which raised equity capital and generated net proceeds for the Company of approximately

$ 0.9 million.

As the Existing PIOs and the Inducement PIOs were classified as equity instruments before and after the exchange, and as

the exchange is directly attributable to an equity offering, the Company recognized the effect of the modification of approximately $ 1.9

million as an equity issuance cost.

In addition, the change in fair value of the contingent

warrant liability associated with 3,729 of the August 2022 Contingent Warrants and 7,459 of the August 2023 Contingent Warrants was decreased

to $ 0 upon the agreement with Wainwright that all prior contingent warrants were no longer issuable or due upon the Warrant Inducement

The fair value of the contingent warrant liability of approximately $ 2,700 was derecognized as of the settlement date, with

the corresponding amount, representing the fair value of the Wainwright Inducement Warrants, was recognized as additional paid-in capital.

The Company evaluated the terms of the 39,158

Inducement Contingent Warrants (equivalent to 7.0 % of the aggregate number of such shares of common stock underlying the Inducement PIOs

that have not been exercised), which are issuable upon a future inducement, and determined that they should be classified as a liability

based upon accounting guidance provided in ASC 815-40.

Since the Inducement Contingent Warrants are a form of compensation to Wainwright,

the Company recorded the value of the liability of approximately $ 158,000 as a reduction of additional paid in capital, with subsequent

changes in the value of the liability recorded in other income (expense) in the accompanying statements of operations.

The fair value

was determined using a Monte-Carlo option pricing model, and as of December 31, 2024 and 2023

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

The Company evaluated the

terms of the August 2022 Private Placement Warrants and determined that they should be classified as equity instruments based upon accounting

guidance provided in ASC 480 and ASC 815-40.

Since the Company determined that the August 2022 Private Placement Warrants were equity-classified,

the Company recorded the proceeds from the August 2022 Private Placement, net of issuance costs, within common stock at par value and

the balance of the net proceeds to additional paid in capital.

The investors in the April

2022 Private Placement agreed to cancel the aggregate of 1,180,812 preferred investment options issued in the April 2022 Private Placement,

as part of their participation in the August 2022 Private Placement.

The preferred investment options that were cancelled were effectively

exchanged for 1,289,148 new preferred investment options in the August 2022 Private Placement, and accordingly have been accounted for

as a modification or exchange of equity-linked instruments.

In accordance with ASC 815-40, as the preferred investment options were classified

as equity instruments before and after the exchange, and as the exchange is directly attributable to an equity offering, the Company recognized

the effect of the exchange as an equity issuance cost.

The increase in the fair value of the preferred investment options as a result

of the exchange was approximately $ 860,000 , and was determined using the Black-Scholes option pricing model, with the following assumptions:

Exercise price

Expected stock price volatility

Risk-free rate of interest

The Company evaluated the terms of the August Contingent Warrants and

determined that they should be classified as a liability based upon accounting guidance provided in ASC 815-40.

As a result of the exchange

of the preferred investment options issued in the April Private Placement, the underlying equity-linked instruments that would trigger

issuance of the April Contingent Warrants was replaced, and therefore the 70,849 of April Contingent Warrants were exchanged for 70,849

of the August Contingent Warrants.

The value of the April Contingent Warrant liability was adjusted to fair value on the date of modification,

using a Monte Carlo simulation, with the change in fair value of approximately $ 8,000 recognized in the accompanying consolidated statements

of operations and comprehensive loss.

The remaining 227,497 August Contingent Warrants were measured as a liability upon the close of

the August Private Placement.

Since the Contingent Warrants are a form of compensation to the placement agent, the Company recorded the

value of the liability of approximately $ 39,000 , as a reduction of additional paid in capital.

The entire 298,346 of August Contingent

Warrants were remeasured at December 31, 2022, using a Monte Carlo simulation, with the change in the value of the liability recorded

in other income (expense) in the accompanying consolidated statements of operations and comprehensive loss.

The following significant

assumptions were used in the valuation of the contingent warrant liability, related to the August Contingent Warrants, as of the date

of the August 2022 Private Placement and as of December 31, 2022:

Exercise price

Expected stock price volatility

Risk-free rate of interest

During the year ended December

31, 2023, in connection with the warrant inducement transaction, the Company issued warrants to Wainwright as settlement of the contingent

warrant liability associated with 149,173 of the August 2022 Contingent Warrants, which was triggered upon exercise of the underlying

preferred investment options.

See Warrant Inducement below for further discussion.

August 2023 Inducement

On July 31, 2023, the Company entered into a common

stock preferred investment option exercise inducement letter (the “Inducement Letter”) with a certain holder of existing preferred

investment options to purchase shares of the Company’s common stock at the original exercise price of $ 101.84 per share, issued

on August 11, 2022 (the “Existing PIOs”).

Pursuant to the Inducement Letter, the Holder agreed to exercise for cash its Existing

PIOs to purchase an aggregate of 62,155 shares of the Company’s common stock (the “Inducement PIO Shares”), at a reduced

exercise price of $ 43.6 per share, in exchange for the Company’s agreement to issue new PIOs (the “Inducement PIOs”)

to purchase up to 124,311 shares of the Company’s common stock.

The Inducement PIOs have substantially the same terms as the Existing

On August 2, 2023, the Company consummated the

transactions contemplated by the Inducement Letter (the “Warrant Inducement”).

The Company received aggregate net proceeds

of approximately $ 2.3 million from the Warrant Inducement, after deducing placement agent fees and other offering expenses payable by

Upon close of the transaction, the Company issued

the Holder 39,375 of the 62,155 shares of common stock that were issuable upon exercise of the Existing PIOs.

Due to the beneficial ownership

limitation provisions in the Inducement Letter, the remaining 22,780 shares were initially unissued, and held in abeyance for the benefit

of the Holder until notice from the Holder that the shares may be issued in compliance with such limitation is received.

were issued to the Holder in October 2023.

The Company agreed to file a registration statement

covering the resale of the Inducement PIO Shares issued or issuable upon the exercise of the Inducement PIOs, as soon as practicable,

and to use commercially reasonable efforts to have such Resale Registration Statement declared effective by the SEC within 90 days following

the date of the Inducement Letter, and to keep the Resale Registration Statement effective at all times until there are no Inducement

The provision to register the underlying shares in the Warrant Inducement does not require payment related to the registration

rights provided.

As such, while the shares were not registered within 90 days of the date of the Inducement Letter, there is no accounting

impact for this provision.

The Company engaged Wainwright to act as its placement

agent in connection with the Warrant Inducement and paid Wainwright a cash fee equal to 7.5 % of the gross proceeds received from the exercise

of the Existing PIOs as well as a management fee equal to 1.0 % of the gross proceeds from the exercise of the Existing PIOs.

also agreed to reimburse Wainwright for its expenses in connection with the exercise of the Existing PIOs and the issuance of the Inducement

PIOs, up to $ 50,000 for fees and expenses of legal counsel and other out-of-pocket expenses and agreed to pay Wainwright for non-accountable

expenses in the amount of $ 35,000 .

In addition, the exercise for cash of the Existing PIOs triggered the issuance to Wainwright or its

designees, warrants to purchase 3,729 shares of common stock (“Wainwright Inducement Warrants”), which were issuable in accordance

with the terms of the August Contingent Warrants, and have the same terms as the Inducement PIOs except for an exercise price equal to

$ 54.50 per share.

The Company also agreed to issue warrants to Wainwright upon any exercise for cash of the Inducement PIOs, that number

of shares of common stock equal to 6.0 % of the aggregate number of such shares of common stock underlying the Inducement PIOs that have

been exercised, also with an exercise price of $ 54.50 (the “Inducement Contingent Warrants”).

The maximum number of Inducement

Contingent Warrants issuable under this provision is 7,459 .

The Company evaluated the terms of the Inducement

PIOs and the Wainwright Inducement Warrants (collectively, the “August 2023 Inducement Warrants”), and determined that they

should be classified as equity instruments based upon accounting guidance provided in ASC 480 and ASC 815-40.

The Company also evaluated

the unissued shares held in abeyance, which represent a prepaid forward contract, and determined that it is an equity instrument based

on the guidance provided in ASC 480 and ASC 815-40.

The Warrant Inducement, which resulted in the

lowering of the exercise price of the Existing PIOs and the issuance of the Inducement PIOs, is considered a modification of the Existing

PIOs under the guidance of Accounting Standards Update (“ASU”) No.

2021-04, Issuer’s Accounting for Certain Modifications

or Exchanges of Equity Classified Written Call Options .

The modification is consistent with the “Equity Issuance” classification

under that guidance as the reason for the modification was to induce the holders of the Existing PIOs to cash exercise their warrants,

resulting in the imminent exercise of the Existing PIOs, which raised equity capital and generated net proceeds for the Company of approximately

$ 2.3 million.

As the Existing PIOs and the Inducement PIOs were classified as equity instruments before and after the exchange, and as

the exchange is directly attributable to an equity offering, the Company recognized the effect of the modification of approximately $ 2.6

million as an equity issuance cost.

In addition, the change in fair value of the contingent

warrant liability associated with 3,729 of the August Contingent Warrants that were settled through issuance of the Wainwright Inducement

Warrants, of approximately $ 122,000 , was recognized in other income(expense) in the accompanying statements of operations, and the fair

value of the contingent warrant liability of approximately $ 129,000 was derecognized as of the settlement date.

The corresponding amount,

representing the fair value of the Wainwright Inducement Warrants, was recognized as additional paid in capital.

The Company evaluated the terms of the Inducement

Contingent Warrants and determined that they should be classified as a liability based upon accounting guidance provided in ASC 815-40.

Since the Inducement Contingent Warrants are a form of compensation to Wainwright, the Company recorded the value of the liability of

approximately $ 26,000 as a reduction of additional paid in capital, with subsequent changes in the value of the liability recorded in

other income (expense) in the accompanying statements of operations.

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

Treasury Stock

On November 10, 2022, the Board approved a stock

repurchase program (the “Repurchase Program”) to allow the Company to repurchase up to 125,000 shares of common stock with

a maximum price of $ 1.00 per share, with discretion to management to make purchases subject to market conditions.

On November 18, 2022,

the Board approved an increase to the maximum price to $ 2.00 per share.

There was no expiration date for this program and prices are not

adjusted for the reverse stock split to comply with the program.

There were no repurchases of common stock during

the year ended December 31, 2024.

During the year ended December 31, 2023, the Company repurchased 1,441 shares of common stock, for an

aggregate of approximately $ 59,000 , at an average price of $ 40.80 (adjusted on a post-reverse stock split basis).

Shares that are repurchased

are classified as treasury stock pending future use and reduce the number of shares outstanding used in calculating earnings per share.

On November 13, 2024, the Board terminated the

Repurchase Program.

At the Market Offering Agreement

On March 29, 2023, the Company

entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C.

Wainwright & Co., LLC, as sales agent

(the “Agent”), to create an at-the-market equity program under which it may sell up to $ 3,900,000 of shares of the Company’s

common stock (the “Shares”) from time to time through the Agent (the “ATM Offering”).

Under the ATM Agreement,

the Agent will be entitled to a commission at a fixed rate of 3.0 % of the gross proceeds from each sale of Shares under the ATM Agreement.

The Company has no obligation to sell, and the Agent is not obligated to buy or sell, any of the Shares under the Agreement and may at

any time suspend offers under the Agreement or terminate the Agreement.

The ATM Offering will terminate upon the termination of the

ATM Agreement as permitted therein.

Deferred offering costs associated

with the ATM Agreement are reclassified to additional paid in capital on a pro-rata basis when the Company completes offerings under the

ATM Agreement.

Any remaining deferred costs will be expensed to the consolidated statements of operations and comprehensive loss should

the planned offering be abandoned.

On March 29, 2023, the Company entered into an

At The Market Offering Agreement (the “ATM Agreement”) with H.C.

Wainwright & Co., LLC, as sales agent (the “Agent”),

to create an at-the-market equity program under which it may sell up to $ 3,900,000 of shares of the Company’s common stock (the

“Shares”) from time to time through the Agent (the “ATM Offering”).

Under the ATM Agreement, the Agent will be

entitled to a commission at a fixed rate of 3.0 % of the gross proceeds from each sale of Shares under the ATM Agreement.

The Company has

no obligation to sell, and the Agent is not obligated to buy or sell, any of the Shares under the Agreement and may at any time suspend

offers under the Agreement or terminate the Agreement.

The ATM Offering will terminate upon the termination of the ATM Agreement

as permitted therein.

Deferred offering costs associated with the ATM

Agreement are reclassified to additional paid in capital on a pro-rata basis when the Company completes offerings under the ATM Agreement.

Any remaining deferred costs will be expensed to the statements of operations should the planned offering be abandoned.

As of December 31, 2024, no shares have been sold

under the ATM Offering, and the Company wrote off approximately $ 0.3 million of deferred offering costs in its consolidated balance sheets

as of December 31, 2024.

no shares have been sold under the ATM Offering.

Warrant Inducement

On July 31, 2023, the Company entered into a common stock preferred

investment options exercise inducement offer letter (the “Inducement Letter”) with a holder (the “Holder”) of

existing preferred investment options (“PIOs”) to purchase shares of the Company’s common stock at the original exercise

price of $ 2.546 per share, issued on August 11, 2022 (the “Existing PIOs”).

Pursuant to the Inducement Letter, the Holder

agreed to exercise for cash its Existing PIOs to purchase an aggregate of 2,486,214 shares of the Company’s common stock (the “Inducement

PIO Shares”), at a reduced exercised price of $ 1.09 per share, in exchange for the Company’s agreement to issue new preferred

investment options (the “Inducement PIOs”) to purchase up to 4,972,428 shares of the Company’s common stock.

The Inducement

PIOs have substantially the same terms as the Existing PIOs.

On August 2, 2023, the Company

consummated the transactions contemplated by the Inducement Letter (the “Warrant Inducement”).

The Company received aggregate

net proceeds of approximately $ 2.3 million from the Warrant Inducement, after deducting placement agent fees and other offering expenses

payable by the Company.

Upon the close of the transaction,

the Company issued the Holder 1,575,000 of the 2,486,214 shares of common stock that were issuable upon exercise of the Existing PIOs.

Due to the beneficial ownership limitation provisions in the Inducement Letter, the remaining 911,214 shares were initially unissued,

and held in abeyance for the benefit of the Holder until notice from the Holder that the shares may be issued in compliance with such

limitation is received.

These shares were issued to the Holder in October 2023.

The Company agreed to file

a registration statement covering the resale of the Inducement PIO Shares issued or issuable upon the exercise of the Inducement PIOs

(the “Resale Registration Statement”), as soon as practicable, and to use commercially reasonable efforts to have such Resale

Registration Statement declared effective by the SEC within 90 days following the date of the Inducement Letter, and to keep the Resale

Registration Statement effective at all times until there are no Inducement PIO Shares.

The provision to register the underlying shares

in the Warrant Inducement does not require payment related to the registration rights provided.

As such, while the shares were not registered

within 90 days of the date of the Inducement Letter, there is no accounting impact for this provision.

ONCONETIX, INC.

2 unchanged sentences

Equity (cont.)

The Company engaged Wainwright

to act as its placement agent in connection with the Warrant Inducement and paid Wainwright a cash fee equal to 7.5 % of the gross proceeds

received from the exercise of the Existing PIOs as well as a management fee equal to 1.0 % of the gross proceeds from the exercise of the

Existing PIOs.

The Company also agreed to reimburse Wainwright for its expenses in connection with the exercise of the Existing PIOs and

the issuance of the Inducement PIOs, up to $ 50,000 for fees and expenses of legal counsel and other out-of-pocket expenses and agreed

to pay Wainwright for non-accountable expenses in the amount of $ 35,000 .

In addition, the exercise for cash of the Existing PIOs triggered

the issuance to Wainwright or its designees, warrants to purchase 149,173 shares of common stock (“Wainwright Inducement Warrants”),

which were issuable in accordance with the terms of the August Contingent Warrants, and have the same terms as the Inducement PIOs except

for an exercise price equal to $ 1.3625 per share.

The Company also agreed to issue warrants to Wainwright upon any exercise for cash of

the Inducement PIOs, that number of shares of common stock equal to 6.0 % of the aggregate number of such shares of common stock underlying

the Inducement PIOs that have been exercised, also with an exercise price of $ 1.3625 (the “Inducement Contingent Warrants”).

The maximum number of Inducement Contingent Warrants issuable under this provision is 298,346 .

The Company evaluated the

terms of the Inducement PIOs and the Wainwright Inducement Warrants (collectively, the “August 2023 Inducement Warrants”),

and determined that they should be classified as equity instruments based upon accounting guidance provided in ASC 480 and ASC 815-40.

The Warrant Inducement, which

resulted in the lowering of the exercise price of the Existing PIOs and the issuance of the Inducement PIOs, is considered a modification

of the Existing PIOs under the guidance of Accounting Standards Update (“ASU”) No.

2021-04, Issuer’s Accounting for

Certain Modifications or Exchanges of Equity Classified Written Call Options .

The modification is consistent with the “Equity

Issuance” classification under that guidance as the reason for the modification was to induce the holders of the Existing PIOs to

cash exercise their warrants, resulting in the imminent exercise of the Existing PIOs, which raised equity capital and generated net proceeds

for the Company of approximately $ 2.3 million.

As the Existing PIOs and the Inducement PIOs were classified as equity instruments before

and after the exchange, and as the exchange is directly attributable to an equity offering, the Company recognized the effect of the modification

of approximately $ 2.6 million as an equity issuance cost.

In addition, the change in

fair value of the contingent warrant liability associated with 149,173 of the August Contingent Warrants that were settled through issuance

of the Wainwright Inducement Warrants, of approximately $ 122,000 , was recognized in other income (expense) in the accompanying consolidated

statements of operations and comprehensive loss, and the fair value of the contingent warrant liability of approximately $ 129,000 was

derecognized as of the settlement date.

The corresponding amount, representing the fair value of the Wainwright Inducement Warrants, was

recognized as additional paid in capital.

The Company measured the liability on the settlement date using a Black Scholes model, with

the following significant assumptions:

expected term of 5.0 years, expected volatility of 117.8 %, risk-free interest rate of 4.24 % and

dividend yield of 0.0 %.

The Company evaluated the

terms of the Inducement Contingent Warrants and determined that they should be classified as a liability based upon accounting guidance

provided in ASC 815-40.

Since the Inducement Contingent Warrants are a form of compensation to Wainwright, the Company recorded the value

of the liability of approximately $ 26,000 as a reduction of additional paid in capital, with subsequent changes in the value of the liability

recorded in other income (expense) in the accompanying consolidated statements of operations and comprehensive loss.

The Company measured

the liability on the settlement date using a Black Scholes model, with the following significant assumptions:

expected term of 5.0 years,

expected volatility of 117.8 %, risk-free interest rate of 4.24 % and dividend yield of 0.0 %.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 9 — Convertible Redeemable Preferred Stock and Stockholders’

Equity (cont.)

The following summarizes

activity related to the Company’s outstanding warrants, excluding contingent warrants issuable upon exercise of the preferred investment

options, for the year ended December 31, 2023:

The following summarizes activity related to the

Company’s outstanding warrants, excluding contingent warrants issuable upon exercise of the preferred investment options, for the

years ended December 31, 2024 and 2023:

Weighted Remaining

Average Contractual

Number of Exercise Life

Shares Price (in years)

Outstanding as of December 31, 2022 147,773 $ 94.8 4.7

( 3,132,854 )

Granted 128,040 44.0 -

Exercised ( 78,321 ) 34.6 -

Outstanding as of December 31, 2023 197,492 $ 67.20 4.3

Granted 1,318,334 4.59 -

Exercised ( 340,493 ) 34.53 -

Outstanding as of December 31, 2024 1,175,333 6.72 2.92

Warrants vested and exercisable as of December 31, 2024 583,475 $ 9.10 2.57

As of December 31, 2023,

the outstanding warrants include 70,849 April 2022 Private Placement Warrants, 2,707,211 August 2022 Private Placement Warrants, and 5,121,601

August 2023 Inducement Warrants, which are exercisable into 7,899,661 shares of common stock which had a fair value of $ 0.20 per share,

based on the closing trading price on that day.

Additionally, as of December

31, 2023 and 2022, the value of the August Contingent Warrants and the Inducement Contingent Warrants (collectively the “Contingent

Warrants”) was approximately $ 3,000 and $ 14,000 , respectively.

The maximum number of warrants issuable upon settlement of the Contingent

Warrants as of December 31, 2023 and 2022 was 447,519 and 298,346 , respectively.

As of December 31, 2024, the Company had outstanding

warrants, which are exercisable into 583,475 shares of common stock.

The shares of common stock underlying the warrants outstanding had

an exercise price of $ 6.72 per share, based on the closing trading price on December 31, 2024.

Contingent Warrant Liabilities

Additionally, as of December 31, 2024, the fair

value of contingent warrant labilities includes the Series C PIPE warrants (see Note 9) of $ 32,982 and those issuable upon exercise of

the Inducement PIOs of approximately $ 10,200 (see Note 9) totaling $ 43,089 included as contingent warrant liabilities in the accompanying

consolidated balance sheets.

As of December 31, 2023, the fair value of contingent

warrants issuable upon exercise of the August 2022 private placement and August 2023 inducement warrants was approximately $ 3,000 .

the PIO inducement in July 2024, the August 2022 and August 2023 contingent warrants were settled and replaced for no consideration.

The maximum number of warrants issuable upon settlement

of the contingent warrants was 39,158 for the Inducement PIOs contingent warrants and 591,856 for the Series C PIPE warrants as of December

The maximum number of warrants issuable upon settlement of the Inducement contingent warrants was 11,188 as of December 31,

Onconetix Equity Incentive Plans

1 unchanged sentence

(the “2019 Plan”) was adopted by its board of directors and by its stockholders on July 1, 2019.

The Company has reserved

1,400,000 shares of common stock for issuance pursuant to the 2019 Plan.

On February 23, 2022 and

in connection with the closing of the IPO, the Company’s board of directors adopted the Company’s 2022 Equity Incentive Plan

(the “2022 Plan”), which is the successor and continuation of the Company’s 2019 Plan.

Under the 2022 Plan, the Company

may grant stock options, restricted stock, restricted stock units, stock appreciation rights, and other forms of awards to employees,

directors, and consultants of the Company.

Upon its effectiveness, a total of 1,600,000 shares of common stock were reserved for issuance

under the 2022 Plan.

In August 2022, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 2,600,000

and in May 2023, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 3,150,000 .

options and restricted stock granted during the years ended December 31, 2023 and 2022 were all granted under the 2022 Plan.

As of December

31, 2023, there are 718,402 shares available for issuance under the 2022 Plan.

On February 23, 2022 the

Company’s board of directors adopted the Company’s 2022 Equity Incentive Plan (the “2022 Plan”), which is the

successor and continuation of the Company’s 2019 Plan.

Under the 2022 Plan, the Company may grant stock options, restricted stock,

restricted stock units, stock appreciation rights, and other forms of awards to employees, directors, and consultants of the Company.

In May 2023, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 78,750 , and in September

2024, the number of shares of common stock reserved for issuance under the 2022 Plan was increased to 1,450,000 .

Stock-based awards granted

during the year ended December 31, 2024 and 2023 were all granted under the 2022 Plan.

As of December 31, 2024, there are 719,660 shares

available for issuance under the 2022 Plan.

ONCONETIX, INC.

3 unchanged sentences

Stock Options

The following summarizes activity related to the

Company’s stock options under the 2019 Plan and the 2022 Plan for the year ended December 31, 2023:

The following summarizes activity related to

the Company’s stock options under the 2019 Plan and the 2022 Plan for the years ended December 31, 2024 and 2023:

Weighted Remaining

Average Total Contractual

Number of Exercise Intrinsic Life

Shares Price Value (in years)

Outstanding as of December 31, 2022 34,816 $ 132.0 $ 670,161 8.2

Granted 24,054 19.2 —

Forfeited / cancelled ( 10,103 ) 194.80 —

Exercised ( 1,148 ) 0.4 1,148 —

Outstanding as of December 31, 2023 47,619 65.20 94,239 8.4

Forfeited / cancelled ( 33,539 ) 28.35 —

Exercised ( 406 ) 0.5 2,512 —

Outstanding as of December 31, 2024 13,674 156.96 —

Options vested and exercisable as of December 31, 2024 9,336 $ 189.15 7.65

The fair value of options granted in 2023 and

2022 was estimated using the following assumptions:

Ended December 31,

There were no stock options granted during the

year ended December 31, 2024.

The fair value of options granted during the year ended December 31, 2023 was estimated using the following

Ended December 31,

1 unchanged sentence

$ 10.40 – 51.60

$ 1.06 – 6.45

Expected stock price volatility

101.1 % – 119.5 %

112.6 % – 121.2 %

Risk-free rate of interest

3.5 % – 4.7 %

2.9 % – 4.3 %

The weighted average grant

date fair value of stock options granted during the years ended December 31, 2023 and 2022 was $ 0.41 and $ 3.40 , respectively.

The aggregate

fair value of stock options that vested during the years ended December 31, 2023 and 2022 was approximately $ 0.7 million and $ 2.1 million,

respectively.

On October 4, 2023, the Company’s

board of directors granted an aggregate of 709,768 stock options in connection with the appointment of the Company’s newly hired

Chief Executive Officer and Chief Financial Officer.

The options granted have an exercise price of $ 0.4305 per share, vest quarterly

over a three-year period, and have a grant date fair value of approximately $ 0.2 million.

The Company recognized less than $ 0.1 million

of stock-based compensation expense related to these awards during the year ended December 31, 2023.

Subsequent to December 31, 2023,

in connection with the resignation of the newly hired Chief Executive Officer, 487,965 of these options were forfeited (see Note 14).

During the year ended December

31, 2022, 200,000 stock options were granted to the Company’s former Chief Executive Officer (“former CEO”), Chairman,

and significant stockholder, 200,000 stock options were granted to the Company’s former Chief Business Officer (“former CBO”),

and 100,000 stock options were granted to the Company’s former Chief Financial Officer (“former CFO”).

The aggregate

grant-date fair value of the stock options granted to these individuals was approximately $ 1.8 million, of which approximately $ 1.5 million

was recognized as stock-based compensation expense during the year ended December 31, 2022.

During the year ended December 31, 2023, in

connection with the resignation of the former CEO and the former CFO, 250,000 of these stock options were forfeited.

Additionally, during the

year ended December 31, 2022, the Company granted an aggregate of 72,223 stock options to non-executive directors.

The grant-date fair

value of the stock options granted to the non-executive directors was approximately $ 0.2 million, of which approximately $ 0.2 million

was recognized as stock-based compensation expense during the year ended December 31, 2022.

The weighted average grant date fair value of

stock options granted during the year ended December 31, 2023 was $ 16.40 .

The aggregate fair value of stock options that vested during

the years ended December 31, 2024 and 2023 was approximately $ 0.7 million and $ 0.7 million, respectively.

On October 4, 2023, the Company’s board

of directors granted an aggregate of 17,744 stock options in connection with the appointment of the Company’s newly hired Chief

Executive Officer and Chief Financial Officer.

The options granted have an exercise price of $ 17.22 per share, vest quarterly over

a three-year period, and have a grant date fair value of approximately $ 0.2 million.

The Company recognized less than $ 0.1 million of

stock-based compensation expense related to these awards during the year ended December 31, 2023.

Subsequent to December 31, 2023, in

connection with the resignation of the newly hired Chief Executive Officer, 12,199 of these options were forfeited.

ONCONETIX, INC.

8 unchanged sentences

were granted to the Company’s former CEO, former CFO, and former CBO, respectively.

All of the restricted shares granted

vest as follows:

All of the restricted shares granted vest as

50 % in January 2024, 25 % in August 2024, and 25 % in August 2025.

In addition, on May 31, 2023, the Board’s Compensation

Committee approved the issuance of 25,440 shares of restricted stock, granted to the Company’s non-executive Board members, with

full vesting on May 31, 2024.

On August 16, 2023 and October

4, 2023, upon their respective resignations, the Company’s former CEO and former CFO forfeited 150,000 shares and 75,000 shares

of unvested restricted stock, respectively.

Committee approved the issuance of 636 shares of restricted stock, granted to the Company’s non-executive Board members, with full

vesting on May 31, 2024.

On February 14, 2024, in connection with the appointment of a non-executive Board member, the Company issued

78 shares of restricted stock, which vested in full on June 14, 2024.

Furthermore, on September 26, 2024, the Company issued its

Board members a total of 16,590 restricted stock, with full vesting August 31, 2025.

Nonvested as of December 31, 2023

Forfeited / cancelled

Nonvested as of December 31, 2024

Proteomedix Stock Option Plan

Proteomedix sponsors a stock

option plan (the “PMX Option Plan”) which provides common stock option grants to be granted to certain employees and consultants,

as was determined by the board of directors of Proteomedix.

In connection with the PMX Transaction, the Company assumed the PMX Option

Plan (see Note 5).

Generally, options issued

under the PMX Option Plan have a term of less than 11 years and provide for a four -year vesting period during which the grantee must remain

in the service of Proteomedix.

Stock options issued under the PMX Option Plan are measured at fair value using the Black-Scholes option

pricing model.

There was no activity under the

PMX Option Plan between the Acquisition Date and December 31, 2023.

As of December 31, 2023, there were 58,172 and 57,276 stock options

outstanding and vested, respectively, with a weighted average exercise price of $ 3.46 and $ 3.17 , respectively, and a weighted average

remaining contractual life of 5.36 years and 5.20 years, respectively.

The intrinsic value of options outstanding and vested, as of December

31, 2023 was approximately $ 7.4 million and $ 7.1 million, respectively.

As of December 31, 2023 there were 47,990 stock options exercisable

at a weighted average exercise price of $ 3.94 and a weighted average remaining contractual life of 4.53 years.

Proteomedix sponsors a stock option plan (the

“PMX Option Plan”) which provides common stock option grants to be granted to certain employees and consultants, as was determined

by the board of directors of Proteomedix.

In connection with the PMX Transaction, the Company assumed the PMX Option Plan (see Note 5).

Generally, options issued under the PMX Option

Plan have a term of less than 11 years and provide for a four -year vesting period during which the grantee must remain in the service

of Proteomedix.

Stock options issued under the PMX Option Plan are measured at fair value using the Black-Scholes option pricing model.

On April 16, 2024, the board of directors of Proteomedix

approved a two-year extension of 12,257 vested stock options that were set to expire in April 2024.

The extended expiration date for these

options is April 18, 2026.

The Company recorded approximately $ 18,000 of expense associated with this modification during the year ended

December 31, 2024.

There was no other activity under the PMX Option

Plan for the year ended December 31, 2024.

In October 2024, 58,172 stock options were converted to shares with a weighted average exercise

price of $ 3.46 .

As of December 31, 2024, there were no outstanding stock options.

Stock-Based Compensation

Stock-based compensation expense for the years

ended December 31, 2023 and 2022 was as follows:

Stock-based compensation expense for the years ended December 31, 2024

and 2023 was as follows:

For the Years Ended

1 unchanged sentence

Research and development

As of December 31, 2023,

unrecognized stock-based compensation expense relating to outstanding stock options and unvested restricted stock under the Onconetix

Equity Incentive Plans is approximately $ 345,000 and $ 35,000 , respectively, which is expected to be recognized over a weighted-average

period of 1.79 years and 1.57 years, respectively.

During the year ended December 31, 2024, in connection

with the termination of three Company employees, outstanding stock options and restricted stock awards to these individuals were modified

to allow continued vesting during the term of their respective new consulting agreements.

The Company recognized a net credit of approximately

$ 58,000 to stock-based compensation expense as a result of these modifications, primarily due to the decrease in the Company’s

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 9 — Convertible Redeemable Preferred Stock and Stockholders’

Equity (cont.)

of December 31, 2023, unrecognized stock-based compensation expense relating to outstanding stock options under the PMX Option Plan is

approximately $ 0.1 million, which will be recognized over a weighted-average period of 2.98 years.

During the year ended December

31, 2023, in connection with the former CBO’s resignation from the Company, the individual’s outstanding stock options and

restricted stock awards were modified to allow continued vesting during the term of the consulting agreement entered into in January 2024.

The Company recognized a net credit of approximately $ 165,000 to stock-based compensation expense as a result of this modification, primarily

due to the decrease in the Company’s stock price.

During the year ended December

31, 2022, the Company’s board of directors approved the accelerated vesting of an aggregate of 32,517 stock options to a former

director and a former advisor, in connection with their separation from the Company.

The Company recognized stock-based compensation expense

of approximately $ 0.1 million related to these modifications during the year ended December 31, 2022.

Note 10 — Commitments and Contingencies

Proteomedix leases office

and lab space in Zurich Switzerland, which requires lease payments of approximately $ 74,000 for the years ended December 31, 2024 and

2025, and which is insignificant to the Company’s consolidated financial statements.

The Company entered into

a short-term lease in Palm Beach, Florida with an unrelated party, with a commencement date of May 1, 2022, for approximately $ 14,000

The lease, which was personally guaranteed by the Company’s former CEO, ended on April 30, 2023.

During the years ended

December 31, 2023 and 2022, the Company incurred rent expense on this lease of approximately $ 51,000 and $129,000, respectively, and variable

lease expense of approximately $ 4,000 and $ 12,000 , respectively.

From time to time, the Company

may be subject to various legal proceedings and claims that arise in the ordinary course of its business activities.

As of December 31,

2023, the Company is not a party to any material legal proceedings and is not aware of any pending or threatened claims.

On April 15, 2022, the Company

received a demand letter (the “Demand Letter”) from Boustead.

The Demand Letter alleged that the Company breached the Underwriting

Agreement entered into between Boustead and the Company, dated February 17, 2022, in connection with the Company’s initial public

The Demand Letter alleged that, by engaging Wainwright as placement agent in the April Private Placement, the Company breached

Boustead’s right of first refusal (“ROFR”) to act as placement agent granted to Boustead under the Underwriting Agreement

and, as a result of selling securities in the April Private Placement, breached the Company’s obligation under the Underwriting

Agreement not to offer, sell, issue, agree or contract to sell or issue or grant or modify the terms of any option for the sale of, any

securities prior to February 17, 2023 (the “Standstill”).

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 10 — Commitments and Contingencies (cont.)

On October 9, 2022, the Company

and Boustead entered into a Settlement Agreement and Release (the “Settlement Agreement”), pursuant to which Boustead agreed

to waive the ROFR and the Standstill, and to release the Company from certain claims with respect to the April Private Placement, the

August Private Placement, and all future private, public equity or debt offerings of the Company.

As consideration for such waiver and

termination of the Underwriting Agreement, the Company paid Boustead a cash fee of $ 1,000,000 , $ 50,000 in legal expenses, and released

Boustead from all claims, subject to certain exceptions.

In addition, the Company issued to Boustead 93,466 shares of restricted common

stock in exchange for the cancellation of 111,111 warrants issued to Boustead in connection with the IPO (see Note 9).

Concurrent with

the execution of the Settlement Agreement, the Company and Boustead Capital Markets, LLP (“Boustead Capital”) entered into

a three-month Advisory Agreement (the “Advisory Agreement”) for which consideration equal to 200,000 shares of restricted

common stock, with no vesting provisions, was issued to Boustead Capital upon execution of the Advisory Agreement.

The incremental fair

value of the Warrant Exchange and the fair value of the restricted common stock issued in connection with these agreements totaled approximately

The Company determined that

all consideration due by the Company under the Settlement Agreement and the Advisory Agreement relates to the settlement of a liability

that was incurred in 2022 and accordingly, recorded a related expense of approximately $ 1.3 million for the year ended December 31, 2022,

which is included in selling, general and administrative expenses in the accompanying consolidated statements of operations and comprehensive

The Company entered into a short-term lease in

Palm Beach, Florida with an unrelated party, with a commencement date of May 1, 2022, for approximately $ 14,000 per month.

which was personally guaranteed by the Company’s former CEO, ended on April 30, 2023.

During the year ended December 31, 2023, the

Company incurred rent expense on this lease of approximately $ 51,000 , and variable lease expense of approximately $ 4,000 .

Proteomedix leases office and lab space in Zurich

On April 1, 2024, the original lease was amended to add additional office and laboratory space.

The lease amendment was

accounted for as a separate lease, resulting in an additional right-of-use asset and lease liability of approximately $ 88,000 .

as amended, requires payments of approximately $ 129,000 for the year ended December 31, 2025.

From time to time, the Company may be subject

to various legal proceedings and claims that arise in the ordinary course of its business activities.

As of December 31, 2024, the Company

is not a party to any material legal proceedings and is not aware of any pending or threatened claims.

However, as discussed in Note 5,

on December 21, 2023, the Company filed a notice with the Bankruptcy Court terminating the WraSer APA and the WraSer MSA, after having

determined that a Material Adverse Effect had occurred.

WraSer has advised the Company that it does not believe that a Material Adverse

Effect occurred, and they recently filed a plan of reorganization that indicates it may seek damages from the Company due to the termination

of the WraSer APA and WraSer MSA.

Registration Rights Agreements

In connection with the April

2022 Private Placement (see Note 9), the Company entered into a Registration Rights Agreement with the purchasers, dated as of April 13,

2022 (the “April Registration Rights Agreement”).

The April Registration Rights Agreement provides that the Company shall

file a registration statement covering the resale of all of the registrable securities (as defined in the April Registration Rights Agreement)

with the SEC.

The registration statement on Form S-1 required under the April Registration Rights Agreement was filed with the SEC on

May 3, 2022 and became effective on May 20, 2022.

A post-effective amendment to the Form S-1 on Form S-3 relating to such registration

statement was filed with the SEC on April 28, 2023.

In connection with the August

2022 Private Placement (see Note 9), the Company entered into a Registration Rights Agreement with the purchasers, dated as of August

9, 2022 (the “August Registration Rights Agreement”).

The August Registration Rights Agreement provides that the Company shall

file a registration statement covering the resale of all of the registrable securities (as defined in the August Registration Rights Agreement)

with the SEC.

The registration statement on Form S-1 required under the August Registration Rights Agreement was filed with the SEC on

August 29, 2022 and became effective on September 19, 2022.

A post-effective amendment to the Form S-1 on Form S-3 relating to such registration

statement was filed with the SEC on April 28, 2023.

In connection with private placements consummated

in April 2022 and August 2022, the Company entered into Registration Rights Agreements with the purchasers.

Upon the occurrence of any

Event (as defined in the April Registration Rights Agreement and the August Registration Rights Agreement), which, among others, prohibits

the purchasers from reselling the securities for more than ten consecutive calendar days or more than an aggregate of fifteen calendar

days during any 12-month period, and should the registration statement cease to remain continuously effective, the Company would be obligated

to pay to each purchaser, on each monthly anniversary of each such Event, an amount in cash, as partial liquidated damages and not as

a penalty, equal to the product of 2.0 % multiplied by the aggregate subscription amount paid by such purchaser in the Private Placement.

As of December 31, 2023, the Company determined that the likelihood of the Company incurring liquidated damages pursuant to the April

Registration Rights Agreement and the August Registration Rights Agreement is remote, and as such, no accrual of these payments is required

as of December 31, 2023.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 10 — Commitments and Contingencies (cont.)

Milestone and Royalty Obligations

The Company has entered into

various license agreements with third parties that obligate the Company to pay certain development, regulatory, and commercial milestones,

as well as royalties based on product sales (see Note 6).

As of December 31, 2023, the Company terminated all license agreements, except

for the CHMC Agreement, which could require the Company to pay CHMC milestone payments of up to an aggregate of $ 59.75 million.

December 31, 2023, the Company evaluated the likelihood of the Company achieving the specified milestones and generating product sales,

and determined the likelihood is not yet probable and as such, no accrual of these payments is required as of December 31, 2023.

Underwriter Termination Agreement

On February 7, 2022, the

Company and its former underwriter, Maxim Group (“Maxim”), entered into a termination agreement, whereby the parties agreed

to terminate their engagement of Maxim as the Company’s lead managing underwriter and book runner in connection with the Company’s

Per the terms of the termination agreement, the Company agreed to pay Maxim a termination fee of $ 300,000 , due upon the close of

the Company’s IPO.

The termination fee was recorded as selling, general and administrative expense, and paid, during the year ended

December 31, 2022.

Event (as defined in each Registration Rights Agreement), which, among others, prohibits the purchasers from reselling the securities

for more than ten consecutive calendar days or more than an aggregate of fifteen calendar days during any 12-month period, and should

the registration statement cease to remain continuously effective, the Company would be obligated to pay to each purchaser, on each monthly

anniversary of each such Event, an amount in cash, as partial liquidated damages and not as a penalty, equal to the product of 2.0 % multiplied

by the aggregate subscription amount paid by such purchaser in the private placements.

As of December 31, 2024, and as a result of the

consummation of the remaining warrants associated with the April 2022 and August 2022 private placements, the Company has no further obligations

pertaining to the Registration Rights Agreements.

Indemnification

In the normal course of business, the Company enters into contracts

and agreements that contain a variety of representations and warranties and provide for general indemnifications.

The Company’s

exposure under these agreements is unknown because it involves claims that may be made against the Company in the future but have not

yet been made.

In the normal course of business, the Company

enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications.

The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the

future but have not yet been made.

To date, the Company has not been required to defend any action related to its indemnification obligations.

However, during

the third quarter of 2023, the Company received a claim from its former CEO and a former accounting employee requesting advancement of

certain expenses.

The Company recorded approximately $ 209,000 in related expenses during the year ended December 31, 2023, of which approximately

$ 159,000 was paid through reduction of the outstanding related party receivable due from the former CEO (see Note 11).

As of December

31, 2023, the Company recorded a related accrual of approximately $ 50,000 , which is included in accrued expenses in the accompanying consolidated

balance sheets, and which was paid subsequent to year end.

The maximum potential amount of future payments the Company could be required

to make under these indemnification agreements is not estimable at this time.

However, during the third quarter of 2023, the Company received a claim from its former CEO and a former accounting employee requesting

advancement of certain expenses.

The Company recorded approximately $ 209,000 in related expenses during the year ended December 31, 2023,

of which approximately $ 159,000 was paid through reduction of the outstanding related party receivable due from the former CEO (see Note

The Company recorded a related accrual of approximately $ 50,000 , which was included in accrued expenses at December 31, 2023, and

which was paid during 2024, and accordingly there is no related accrual as of December 31, 2024.

The maximum potential amount of future

payments the Company could be required to make under these indemnification agreements is not estimable at this time.

ONCONETIX, INC.

1 unchanged sentence

Note 11 — Related Party Transactions

The Company originally engaged

the former CEO, who was also the Board Chairman and prior to the close of the IPO, sole common stockholder of the Company, pursuant to

a consulting agreement commencing October 22, 2018, which called for the Company to pay for consulting services performed on a monthly

Upon the close of the Company’s IPO, the consulting agreement was terminated, and the former CEO’s employment agreement

became effective.

During the year ended December 31, 2022, the Company incurred approximately $ 63,000 in fees under the consulting agreement,

which are recognized in selling, general and administrative expenses in the accompanying consolidated statements of operations and comprehensive

During 2022 the Company entered

into a lease agreement that was personally guaranteed by the Company’s former CEO.

The lease expired in 2023.

During the year ended December 31, 2022, the Company’s compensation

committee approved one-time bonus awards of $ 140,000 and $ 100,000 to the Company’s former CEO and former CBO, respectively, in recognition

of their efforts in connection with the Company’s IPO.

These bonuses were recognized during the year ended December 31, 2022, as

selling, general and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss.

During the year ended December

31, 2023, the Company’s Audit Committee completed a review of the Company’s expenses due to certain irregularities identified

with regards to the related party balance.

Based on the results of the review, it was determined that the Company paid and recorded within

selling, general and administrative expenses, personal expenditures of the Company’s former CEO and an accounting employee who was

also the former CEO’s assistant, during 2022 and during the first three quarters of 2023.

The Company evaluated the receivable,

which aggregated to approximately $ 522,000 as of September 30, 2023, and which represented the total of the items identified as personal

in nature for which the Company did not anticipate recovery from the related party.

As the Company concluded that the remaining amounts

are not likely to be recovered, this would not cause an adjustment to previously issued financial statements.

The Company recorded a corresponding

reserve for the full amount, resulting in a net related party receivable balance of $0 and a loss on related party receivable of approximately

$ 266,000 , which was recorded in selling, general, and administrative expenses in the accompanying consolidated statements of operations

and comprehensive loss for the year ended December 31, 2023.

During the fourth quarter of 2023, the Company recorded a recovery of approximately

$ 159,000 with respect to amounts that the former CEO agreed to repay the Company, through a reduction of amounts that were due to him

from the Company under his indemnification rights pursuant to his employment agreement (see Note 10).

As of December 31, 2022,

the Company had a receivable from related party of approximately $ 36,000 , consisting of miscellaneous payments made by the Company on

the behalf of the Company’s CEO, and which was paid in full during the first quarter of 2023.

On December 18, 2023, the

Company entered into the Subscription Agreement with the PMX Investor, a 5 % stockholder of the Company as of December 31, 2023 (see Note

Subsequent to December 31, 2023, the Company issued a non-convertible debenture in the principal amount of $ 5.0 million to the PMX

Investor, in connection with the Subscription Agreement (see Note 14).

A former director of the

Company, who served on the Company’s Scientific Advisory Board until August 2023, serves on the Advisory Board for the Cincinnati

Children’s Hospital Medical Center Innovation Fund, which is affiliated with CHMC.

The Company has an exclusive license agreement

with CHMC as disclosed in Note 5.

This director resigned from the Company’s board upon the close of its IPO.

During 2022, the Company entered into a lease

agreement that was personally guaranteed by the Company’s former CEO.

The lease expired on April 30, 2023 (see Note 10).

During the year ended December 31, 2023, the Company’s

Audit Committee completed a review of the Company’s expenses due to certain irregularities identified with regards to the related

party balance.

Based on the results of the review, it was determined that the Company paid and recorded within selling, general and administrative

expenses, personal expenditures of the Company’s former CEO and an accounting employee who was also the former CEO’s assistant,

during 2022 and during the first three quarters of 2023.

The Company evaluated the receivable, which was approximately $ 363,000 , after

recording a recovery of approximately $ 159,000 , and which represented the total of the items identified as personal in nature for which

the Company did not anticipate recovery from the related party.

During 2023, the Company recorded a corresponding reserve for the full

amount, resulting in a net related party receivable balance of $0 as of December 31, 2024 and December 31, 2023.

On December 18, 2023, the Company entered into

the Subscription Agreement with the PMX Investor, a 5 % stockholder of the Company as of December 31, 2024 (see Note 8).

During the year

ended December 31, 2024, the Company issued a non-convertible debenture in the principal amount of $ 5.0 million to the PMX Investor, in

connection with the Subscription Agreement and has settled the principal and accrued interest through the issuance of shares (see Notes

On February 6, 2024, the Company appointed Thomas

Meier, PhD, as a member of the Company’s board of directors.

Meier provides consulting services to Proteomedix, through a consulting

agreement that was effective January 4, 2024.

The Company recorded approximately $ 58,000 in related expenses during the year ended December

31, 2024, of which approximately $ 0 is included in accounts payable in the accompanying consolidated balance sheets as of December 31,

ONCONETIX, INC.

1 unchanged sentence

Note 12 — Income Taxes

The components of loss before income taxes are

The components of loss before income taxes are as follows:

For the Years Ended

4 unchanged sentences

$ ( 37,422,287 )

The Company’s major

tax jurisdictions are the United States, Switzerland, and various state jurisdictions, and the Company does not have any pending tax audits.

The income tax benefit recorded for the year ended December 31, 2023 related to the Company’s deferred foreign taxes.

no income tax provision or benefit recorded for the year ended December 31, 2022.

Generally, the Company’s federal returns from

2019 on and state returns from 2018 on, and foreign returns from 2018 on, are subject to examination by the United States, state, and

foreign tax authorities;

however, to the extent allowed by law, tax authorities have the ability to adjust the Company’s carryforwards

of unutilized net operating losses and research and development credits for all years.

At December 31, 2023, the

Company had a net operating loss (“NOL”) carryforward for federal, foreign, and state income tax purposes totaling approximately

$ 27.9 million, $ 18.0 million, and $ 23.8 million, respectively, available to reduce future taxable income.

The federal NOL and certain

state NOLs of $ 16.8 million are carried forward indefinitely subject to a limitation of 80 % of taxable income.

State NOLs of approximately

$ 6.8 million will begin to expire in 2024 if not utilized, and foreign NOLs of approximately $ 15.1 million will begin to expire in 2024

if not utilized.

The NOL carry forward is

subject to review and possible adjustment by the Internal Revenue Service and state tax authorities.

Under the Internal Revenue Code (“IRC”)

The Company’s major tax jurisdictions are

the United States, Switzerland, and various state jurisdictions, and the Company does not have any pending tax audits.

The income tax

benefit recorded for the years ended December 31, 2024 and December 31, 2023 related to the Company’s deferred foreign taxes.

the Company’s federal returns from 2019 on and state returns from 2018 on, and foreign returns from 2018 on, are subject to examination

by the United States, state, and foreign tax authorities;

however, to the extent allowed by law, tax authorities have the ability to adjust

the Company’s carryforwards of unutilized net operating losses and research and development credits for all years.

At December 31, 2024, the Company had a net operating

loss (“NOL”) carryforward for federal, foreign, and state income tax purposes totaling approximately $ 42.8 million, $ 15.2

million, and $ 35.7 million, respectively, available to reduce future taxable income.

The federal NOL and certain state NOLs of $ 28.6 million

are carried forward indefinitely subject to a limitation of 80 % of taxable income.

State NOLs of approximately $ 15.2 million will begin

to expire in 2024 if not utilized, and foreign NOLs of approximately $ 7.1 million will begin to expire in 2024 if not utilized.

The NOL carry forward is subject to review and

possible adjustment by the Internal Revenue Service and state tax authorities.

Under the Internal Revenue Code (“IRC”) Sections

382 and 383, annual use of the Company’s net operating loss carryforwards and research credit carryforwards to offset taxable income

and tax, respectively, may be limited based on cumulative changes in ownership.

The Company has not completed an analysis to determine

whether any such limitations have been triggered as of December 31, 2024.

The amount of the annual limitation, if any, will be determined

based on the value of the Company immediately prior to the ownership change.

Subsequent ownership changes may further affect the limitation

in future years.

The tax effects of the temporary differences and

carryforwards that give rise to deferred tax assets and liabilities consist of the following:

Deferred tax assets:

Net-operating loss carryforward

Capitalized research and development

Stock-based compensation

Deposit on WraSer APA

Accrued compensation

License agreement

Gross deferred tax assets

Valuation allowance

( 20,441,833 )

( 15,697,701 )

Deferred tax assets, net of allowance

Deferred tax liabilities:

Intangible assets

( 4,345,449 )

Total deferred tax liabilities

$ ( 4,377,198 )

Net deferred tax liability

$ ( 3,073,781 )

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 12 — Income Taxes (cont.)

The Company has evaluated the positive and negative

evidence bearing upon the realizability of its deferred tax assets.

The Company has recorded a valuation allowance against its United

States and foreign deferred tax assets in each of the years ended December 31, 2024 and 2023, because the Company’s management believes

that it is more likely than not that these assets will not be realized.

During the years ended December 31, 2024 and 2023, the valuation

allowance increased by approximately $ 4.7 million and $ 11.2 million, respectively.

The provision for income taxes on earnings subject

to income taxes differs from the statutory Federal rate at December 31, 2024 and 2023, due to the following:

For the Years Ended

Expected income tax benefit at Federal statutory tax rate

$ ( 12,488,416 )

$ ( 7,858,680 )

State and local taxes, net of Federal tax benefit

( 1,192,605 )

Research credits

Foreign NOL expirations

Stock-based compensation

Subscription agreement liability

Officer’s compensation

Acquisition related costs

Goodwill Impairment

Permanent items

State rate adjustment

Foreign rate differential

Currency translation adjustment

Change in valuation allowance

Income tax benefit

$ ( 1,045,180 )

GAAP, the impact of an uncertain income

tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit

by the relevant taxing authority.

An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being

Additionally, U.S.

GAAP provides guidance on derecognition, classification, interest and penalties, accounting for interim

periods, disclosure, and transition.

A reconciliation of the beginning and ending amount of unrecognized

tax benefits is as follows:

For the Years Ended

Beginning balance

Increases related to prior year tax positions

Increases related to current year tax positions

Ending balance

At December 31, 2024 and 2023, the Company’s

unrecognized tax benefits were $ 26,462 and $ 17,010 , respectively.

Due to the existence of the valuation allowance, future changes in the

Company’s unrecognized tax benefits will not impact the effective tax rate.

The Company does not expect its unrecognized tax benefits

to change significantly over the next 12 months.

The Company’s policy is to recognize interest

and penalties related to uncertain tax positions in income tax expense.

As of December 31, 2024 and 2023, there were no accrued interest

and penalties associated with uncertain tax positions.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 13 — Net Loss Per Share

Basic net loss per share is computed by dividing

the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period.

weighted average number of shares of common stock outstanding includes pre-funded warrants because their exercise requires only nominal

consideration for delivery of shares;

it does not include any potentially dilutive securities or any unvested restricted shares of common

Certain restricted shares, although classified as issued and outstanding at December 31, 2024, are considered contingently returnable

until the restrictions lapse and will not be included in the basic net loss per share calculation until the shares are vested.

shares of the Company’s restricted stock do not contain non-forfeitable rights to dividends and dividend equivalents.

The two-class method is used to determine earnings

per share based on participation rights of participating securities in any undistributed earnings.

Each share of preferred stock that

includes rights to participate in distributed earnings is considered a participating security and the Company uses the two-class method

to calculate net income available to the Company’s common stockholders per common share — basic and diluted.

The following securities were excluded from the

computation of diluted shares outstanding due to the losses incurred in the periods presented, as they would have had an anti-dilutive

impact on the Company’s net loss:

For the Years Ended

Options to purchase shares of common stock

Unvested shares of restricted stock

Common stock issuable upon conversion of Series A Preferred Stock

Common stock issuable upon conversion of Series C Redeemable Preferred Stock

Note 14 — Defined Benefit Plan

Proteomedix sponsors a defined benefit pension

plan (the “Swiss Plan”) covering certain eligible employees.

The Swiss Plan provides retirement benefits based on years of

service and compensation levels.

The following significant actuarial assumptions

were used in calculating the benefit obligation and the net periodic benefit cost as of December 31, 2024 and 2023:

Discount rate

Expected long-term rate of return on plan assets

Rate of compensation increase

Changes in these assumptions may have a material

impact on the plan’s obligations and costs.

The components of net periodic benefit cost

for the year ended December 31, 2024 and for the period from December 15, 2023 to December 31, 2023 are as follows:

For the year ended

For the period

through December 31,

Interest cost

Expected return on plan assets

Amortization of net (gain) loss

Settlements (gain) loss

During the year ended December 31, 2024 and for

the period ended December 15, 2023 through December 31, 2023, the Company made pension contributions of approximately $ 89,404 and $ 0 ,

respectively.

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 14 — Defined Benefit Plan (cont.)

The components of accumulated comprehensive loss

attributable to the Company’s pension plan for the year ended December 31, 2024 and for the period from December 15, 2023 to December

31, 2023 are as follows:

For the year ended December 31,

For the period

Net loss (gain)

$ ( 190,064 )

Prior service cost (credit)

Amortization of net gain

Effect of settlement

Other adjustments

Total recorded during the period

$ ( 238,010 )

As of December 31, 2024 and 2023, the funded status

of the plan and the amounts recognized in the accompanying consolidated balance sheet are as follows:

Projected benefit obligation

Fair value of plan assets

Overfunded (underfunded) status

$ ( 280,879 )

$ ( 556,296 )

A reconciliation of the beginning and ending balances

of the accumulated benefit obligation is provided in the table below:

As of December 31, 2023

Interest cost

Actuarial (gain) loss

Benefits paid

Ordinary contributions paid by employees

Contributions paid by plan participants

Plan amendments

Projected benefit obligation as of December 31, 2024

Actuarial (gain)/loss due to assumption changes

Actuarial (gain)/loss due to plan experience

Accumulated benefit obligation as of December 31, 2024

A reconciliation of the beginning and ending balances

of the plan assets is provided in the table below:

As of December 31, 2023

Actual return on plan assets

Contributions paid by employer

Ordinary contributions paid by employees

Contributions paid by plan participants

Benefits paid

As of December 31, 2024

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 14 — Defined Benefit Plan (cont.)

Projected benefit payments for the next five years

as of December 31, 2024 are as follows:

Years ending December 31,

Note 15 – Segment Information

The Company conducts its business activities and

reports financial results as one business segment.

The presentation of financial results as one reportable segment is consistent with

the way the Company operates its business and is consistent with the manner in which the Chief Operating Decision Maker ("CODM")

evaluates performance and makes resource and operating decisions for the business.

The Company’s CODM is the Chief Executive Officer.

Furthermore, the Company notes that monitoring financial results as one reportable segment helps the CODM manage costs on a consolidated

basis, consistent with the integrated nature of the operations.

The CODM uses net loss, as reported on the Consolidated Statements of

Operations and Comprehensive Loss, in evaluating performance of the Company and determining how to allocate resources of the Company as

As the CODM evaluates performance on a consolidated basis, all required financial segment information is included in the consolidated

financial statements.

Geographic Information

The distribution of revenue by geographical area

was as follows:

United States

United Kingdom

The distribution of long-lived assets by geographical

area, which includes property and equipment and the Company’s right of use asset, was as follows:

United States

ONCONETIX, INC.

Notes to Consolidated Financial Statements

Note 16 — Subsequent Events

IQVIA Settlement:

As previously disclosed

in Current Reports on Form 8-K filed on July 21, 2023 and October 18, 2023, Onconetix, Inc.

(the “Company”) entered into a

Licensing and Services Master Agreement (“Master Services Agreement”) and a related statement of work with IQVIA, Inc.

on July 21, 2023, and a second statement of work on July 29, 2023, which were terminated on October 12, 2023.

On January 15, 2025, the

Company and IQVIA entered into a Settlement Agreement (the “Settlement Agreement”) concerning potential termination payments

under the Master Services Agreement and statements of work.

Pursuant to the Settlement Agreement, the Company agreed to pay to IQVIA an

aggregate of $ 150,000 in exchange for a mutual release of all claims in connection with the Master Services Agreement.

As a result of

the Settlement Agreement, the Company will record an adjustment of approximately $( 0.9 ) million in accounts payable.

Potential Business

On April 8, 2025, the

Company issued a press release announcing the execution of a “Non-Binding Letter of Intent contemplating a potential business combination

transaction with Ocuvex Therapeutics, Inc.

(“Ocuvex”), a privately held biopharmaceutical company focused on the development

and commercialization of ophthalmic therapeutic candidates to address highly prevalent diseases in need of new treatment options.

Company and Ocuvex intend to continue negotiations to enter into a definitive agreement.

Upon closing of the proposed transaction, the

Company will acquire all the issued and outstanding equity interests of Ocuvex in exchange for newly issued shares of common stock of

Immediately following the closing of the proposed transaction, the pre-closing Ocuvex equity holders will own approximately

90 % of the equity interests in the Company.

ELOC Draws and Series

C Preferred Stock Redemption:

As of April 15, 2025,

the Company has redeemed approximately 1,369 Series C preferred shares for an aggregate amount of $ 1.71 million.

An additional amount

of $ 150,531 is due to the PIPE Series C investors for 120 Series C preferred shares that remain due from the most recent ELOC draw.

120 shares remain subject to future redemption.

On May 30, 2025, the

Company has sold approximately 33,256,563 shares under the ELOC Purchase Agreement for aggregate proceeds of approximately $ 5.3 million,

for a total of 36,014,496 shares sold under the ELOC Purchase Agreement for gross proceeds of approximately $ 6.2 million.

Veru Agreement Waivers:

On March 31, 2025, Veru

and the Company entered into a waiver agreement, pursuant to which Veru agreed to waive and extend the date for payment of the April 2024

Promissory Note to April 14, 2025.

On April 23, 2025, Veru

and the Company entered into a waiver agreement, pursuant to which Veru agreed to waive and extend the date for payment of the April 2024

Promissory Note to June 30, 2025.

Share Exchange Agreement, dated December 15, 2023, by and among the Company, Proteomedix, Thomas Meier and the Sellers.

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

What changed 10-K

Item 9A. Controls and Procedures