OS Therapies Inc 10-K

Item 8. Financial Statements and Supplementary Data. OS THERAPIES I NCORPORATED INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (PCAOB ID No. 206 ) 70 Consolidated Balance Sheets as of December 31, 2025 and 2024 71 Consolidated Statements of Operations for the years ended December 31, 2025 and 2024 72 Consolidated Statements of Stockholders’ Deficit for the years ended December 31, 2025 and 2024 73 Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024 74 Notes to the Consolidated Financial Statements 75 69 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of OS Therapies Incorporated Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of OS Therapies Incorporated and its subsidiaries (collectively, the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for the years 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, 2025 and 2024, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. Going Concern Matter The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 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 1. 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 audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ MaloneBailey, LLP www.malonebailey.com We have served as the Company’s auditor since 2020. Houston, Texas March 30, 2026 70 OS Therapies Incorporated Consolidated Balance Sheets December 31, December 31, 2025 2024 ASSETS Current Assets Cash $ 269,830 $ 5,533,527 Prepaid expenses 63,082 - Total Current Assets 332,912 5,533,527 Long-Term Assets Fixed assets (net) 2,490 5,270 Patent (net of amortization) 6,504,132 - Total-Long Term Assets 6,506,622 5,270 TOTAL ASSETS $ 6,839,534 $ 5,538,797 LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIT Current Liabilities Accounts payable $ 9,936,387 $ 1,662,068 Accrued expenses 1,415,002 521,010 Accrued payroll and payroll taxes – related party 36,792 97,257 Accrued payroll and payroll taxes 1,279 - Preferred dividends payable 375,000 375,000 Warrant liability - 1,971,975 Total Current Liabilities 11,764,460 4,627,310 Long-Term Liabilities TEDCO grant 100,000 100,000 Total Long-Term Liabilities 100,000 100,000 Total Liabilities 11,864,460 4,727,310 Commitments and contingencies (See Note 6) MEZZANINE EQUITY: Series A Convertible Preferred Stock, par value $ 0.001 , 2,500,000 shares authorized; 392,500 and 1,775,750 issued and outstanding, respectively 1,070,705 4,078,025 Total Mezzanine Equity 1,070,705 4,078,025 STOCKHOLDERS’ DEFICIT Common Stock A, par value $ 0.001 , 150,000,000 shares authorized; 37,113,082 and 20,869,908 issued and outstanding, respectively 37,116 20,870 Preferred Stock, par value $ 0.001 , 5,000,000 shares authorized; 0 and 0 shares outstanding, respectively - - Additional paid-in capital 61,053,472 35,144,967 Accumulated deficit ( 67,186,219 ) ( 38,432,375 ) Total Stockholders’ Deficit ( 6,095,631 ) ( 3,266,538 ) TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIT $ 6,839,534 $ 5,538,797 The accompanying notes are an integral part of these consolidated financial statements. 71 OS Therapies Incorporated Consolidated Statements of Operations For the Years Ended December 31, 2025 and 2024 For the Year Ended For the Year Ended December 31, December 31, 2025 2024 OPERATING EXPENSES Research and development $ 16,360,725 $ 2,839,060 General and administrative 12,344,976 3,974,786 Loss from operations ( 28,705,701 ) ( 6,813,846 ) OTHER INCOME/EXPENSE Interest income 249 . Interest expense - ( 2,051,839 ) Non-operating income - 33,997 Non-operating expenses ( 1,472,995 ) ( 51,250 ) Change in fair value of warrant liability 1,424,603 - TOTAL OTHER INCOME/EXPENSE ( 48,143 ) ( 2,069,092 ) NET LOSS ( 28,753,844 ) ( 8,882,938 ) Cumulative Series A preferred stock dividend requirement - ( 31,250 ) NET LOSS available to common shareholders $ ( 28,753,844 ) $ ( 8,914,188 ) Weighted average # of shares 29,253,292 6,950,100 Basic and diluted loss per common share outstanding $ ( 0.98 ) $ ( 1.28 ) The accompanying notes are an integral part of these consolidated financial statements. 72 OS Therapies Incorporated Consolidated Statements of Stockholders’ Deficit For the Years Ended December 31, 2025 and 2024 Common Stock Preferred Stock Additional Total CS – Shares Shares Par Paid-in Accumulated Stockholders’ CS – Par Amount Capital Deficit Deficit Balances, December 31, 2023 5,340,000 $ 5,340 1,302,082 $ 1,302 $ 5,495,330 $ ( 29,518,187 ) $ ( 24,016,215 ) Conversion of Preferred Stock to Common Stock 651,041 651 ( 1,302,082 ) ( 1,302 ) 651 - - Preferred Dividends - - - - - ( 31,250 ) ( 31,250 ) Issuance of Common Stock IPO 1,600,000 1,600 - - 4,473,626 - 4,475,226 Conversion of Convertible Notes to Common Stock 13,153,396 13,153 - - 24,743,662 - 24,756,815 Conversion of Warrants to Common Stock 411,290 411 - - ( 411 ) - - Issuance of Common Stock to Investment Advisor 320,133 320 - - ( 320 ) - - Issuance of Common Stock to Investment Advisor 32,500 33 - - 129,968 - 130,000 Surrender of Common Stock Investors ( 669,958 ) ( 669 ) - - 669 - - Stock-based compensation - - - - 268,300 - 268,300 Shares issued for Services 25,000 25 - - 24,975 - 25,000 Shares issued for Interest 6,506 7 - - 8,516 - 8,523 Net Loss - - - - - ( 8,882,938 ) ( 8,882,938 ) Balances, December 31, 2024 20,869,908 $ 20,870 - $ - $ 35,144,967 $ ( 38,432,375 ) $ ( 3,266,538 ) Commitment shares issued for Equity Line of Credit 157,407 157 - - 568,078 - 568,235 Common Stock issued for Services 450,000 450 - - 4,599,054 - 4,599,504 Stock-based compensation - - - - 4,265,374 - 4,265,374 Conversion of Preferred Shares Mezzanine Equity to Common Stock 4,939,808 4,939 - - 3,725,181 - 3,730,120 Issuance of Common Stock for Patent License 4,774,637 4,776 - - 6,393,239 - 6,398,015 Sale of Common Stock to Investors 282,679 282 529,878 530,160 Conversion of Warrants to Common Stock 5,638,643 5,639 - - 7,138,562 - 7,144,201 Warrants Liability Reclass Preferred Stock - - - - 878,153 - 878,153 Warrants exercised and proceeds received, shares pending issuance - - - - 1,579,870 - 1,579,870 Net Loss - - - - - ( 28,753,844 ) ( 28,753,844 ) Balances, December 31, 2025 37,113,082 $ 37,113 - $ - $ 61,053,475 $ ( 67,186,219 ) $ ( 6,095,631 ) The accompanying notes are an integral part of these consolidated financial statements. 73 OS Therapies Incorporated Consolidated Statements of Cash Flows For the Years Ended December 31, 2025 and 2024 December 31, December 31, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ ( 28,753,844 ) $ ( 8,882,938 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization expense 363,085 2,780 Amortization of debt discounts issuance and warrants - 1,425,679 Shares issued for services - 25,000 Shares issued for interest expense - 8,523 Change in value of warrant liabilities ( 1,424,603 ) - Commitment shares issued for equity line of credit 568,235 - Common shares issuance for services 595,841 - Stock-based compensation 4,265,957 268,300 Amortization of non-cash prepaids 1,037,631 Adjustments to reconcile net loss to net cash used in operating activities: Accounts payable 8,274,316 ( 1,053,331 ) Accrued expenses 893,992 358,510 Accrued interest on convertible notes - 613,605 Accrued Payroll and payroll taxes ( 59,186 ) ( 48,423 ) Net cash used in operating activities ( 14,238,576 ) ( 7,282,295 ) CASH FLOWS FROM INVESTING ACTIVITIES Patent License Acquisition ( 466,423 ) - Net cash used in investing activities ( 466,423 ) - CASH FLOWS FROM FINANCING ACTIVITIES Prepaid warrants (net of fees) 530,162 - Common stock issuance (net of fees) 7,858,140 - Short-term borrowings - 250,000 Short-term loan repayments - ( 250,000 ) Sale of preferred stock 1,053,000 6,050,000 Initial public offering (net of fees) - 5,225,840 Net proceeds from conversion of debt A, B, C, D, E & F - 1,501,000 Net cash provided by financing activities 9,441,302 12,776,840 Net change in cash ( 5,263,697 ) 5,495,545 Cash – beginning of period 5,533,527 38,982 Cash – end of period $ 269,830 $ 5,533,527 Cash paid for interest $ - $ - NON-CASH INVESTING AND FINANCING ACTIVITIES Discount on notes payable – redemption premium $ - $ 750,500 Dividends payable - 31,250 Deemed dividend on Series A convertible preferred stock - 1,971,975 Mezzanine equity conversion (net of costs) 3,730,121 - Conversion of preferred stock to common stock - 1,302 Amortization of deferred offering costs - 751,050 Conversion of convertible notes into common stock - 24,757,252 Conversion of warrants into common stock - 411 Issuance of common stock to investor advisor – settlement - 320 Conversion of make-whole liability to common stock - 130,000 Clawback of common stock for over issuance - ( 670 ) Common stock issued for patent purchase 6,398,015 - Reclassification of warrants liability to equity 878,153 - Shares issued for prepaid services $ 1,100,713 $ - The accompanying notes are an integral part of these consolidated financial statements. 74 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 1 — ORGANIZATION AND DESCRIPTION OF BUSINESS, LIQUIDITY, AND RISK FACTORS OS Therapies Incorporated (“we,” “us,” “our,” the “Company”) is a Delaware corporation incorporated on June 24, 2019 . It is based in Rockville, Maryland. The Company is the successor to an LLC formed in 2018. The Company intends to focus on the identification, development, and commercialization of treatments for Osteosarcoma and other related diseases. As of December 31, 2025, there is one ongoing clinical trial for Osteosarcoma therapy. OS Animal Health Corp – Subsidiary On June 25, 2025, the Company formed OS Animal Health Corp, a Delaware corporation and wholly owned subsidiary. The subsidiary had minimal activity during the year ended December 31, 2025, consisting primarily of investor relations and audit-related expenses. During this period, the Company entered into a license agreement with the subsidiary, pursuant to which it granted the subsidiary rights to use the HER2 Assets (as defined below). OS Therapies UK LTD – Subsidiary On August 29, 2025, the Company formed OS Therapies UK LTD, a United Kingdom corporation and wholly owned subsidiary. This subsidiary serves as the Company’s research and development arm and had substantial operating activity during 2025. The Company has transitioned its research and development activities to this subsidiary and intends to enter into an intercompany loan agreement, which is currently pending. Liquidity The Company has prepared its consolidated financial statements on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Since inception, the Company has incurred significant net losses and negative cash flows from operations. During the year ended December 31, 2025, the Company incurred a net loss of $ 28.8 million and used $ 14.2 million in cash for operating activities. As of December 31, 2025, the Company had cash and cash equivalents of $ 269,830 . Management has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these consolidated financial statements are issued. The Company’s current cash balance is insufficient to fund operations. During 2025, the Company incurred significant expenses, primarily related to activities in preparation for potential regulatory approvals by the U.S. Food and Drug Administration and other regulatory authorities. The Company expects vendor and related costs associated with these efforts to total approximately $ 25.0 million and continue into 2026. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to raise additional capital to fund its research and development and future operations. Management’s plans to mitigate these conditions include: ● Equity and Debt Financing: The Company is actively seeking additional capital through public or private equity offerings or debt financings. However, there can be no assurance that the Company will be successful in sequestering additional financing on favorable terms, or at all. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. 75 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of U.S. Securities and Exchange Commission (“SEC”). The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is December 31. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and majority-owned subsidiaries. The Company consolidates all entities in which it has a controlling interest. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in its consolidated financial statements and accompanying notes. On an ongoing basis, management evaluates these estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that management believes to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from management’s estimates. Cash Cash consists primarily of deposits with commercial banks and financial institutions. The Company maintains cash balances at various financial institutions. Both interest and non-interest-bearing accounts with the same insured depository institution are insured by the Federal Deposit Insurance Corporation (FDIC) for a combined total of $ 250,000 . In the normal course of business, the Company may have deposits that exceed the FDIC insured limit. The Company believes that it is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. As of December 31, 2025 and December 31, 2024, JPMorgan Chase Bank checking account had $ 233,490 and $ 5,216,354 , respectively, and the JPM Chase savings account had $ 20,269 and $ 20,021 , respectively. As of December 31, 2025 and December 31, 2024, Silicon Valley Bank checking account had $ 6,071 and $ 287,173 , respectively, and the SVB money market account had $ 10,000 and $ 10,000 , respectively. The JPM Chase and SVB checking accounts were in excess of the FDIC limits for the year ended December 31, 2024. Redeemable Preferred Stock and Mezzanine Equity The Company’s Series A Senior Convertible Preferred Stock, par value $ 0.001 per share (the “Series A Preferred Stock”), is classified as mezzanine equity in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 (“ASC 480”) due to its redemption features upon the occurrence of a deemed liquidation event, including (i) a merger or consolidation or (ii) the sale, lease, transfer, or other disposition of substantially all of the Company’s assets. Proceeds from the issuance were allocated between the Series A Preferred Stock and the accompanying warrants to purchase shares of common stock (the “Series A Warrants”) on a relative fair value basis. Of the initial $ 6,050,000 in proceeds, a portion was allocated to the Series A Warrants, with the residual allocated to the Series A Preferred Stock. Similarly, of the subsequent $ 1,053,000 in proceeds, a portion was allocated to the Series A Warrants, with the residual allocated to the Series A Preferred Stock. 76 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (cont.) Fixed Asset Policy A capital asset is defined as a unit of property that has an economic useful life that extends beyond 12 months. Any items costing below the threshold or not fitting the definition of a capital asset will be expensed in the consolidated financial statements. All capital assets are recorded at historical cost as of the date acquired. Computer assets will be capitalized and Straight-Line depreciated over five years for financial statement purposes. Patent Amortization On April 9, 2025, in connection with the HER2 Purchase Agreement (as defined below), the Company acquired the HER2 Assets (as defined below) from Ayala (as defined below), including the assignment by Ayala of a license agreement with the Trustees of the University of Pennsylvania. These intangible assets are amortized on a straight-line basis over their estimated useful lives, with amortization recorded quarterly. Amortization expense for the years ended December 31, 2025 and 2024 was $ 360,305 and $ 0 , respectively. Patent and License Acquisition On April 9, 2025, pursuant to the terms of an Asset Purchase Agreement, dated as of January 28, 2025 (the “HER2 Purchase Agreement”), between the Company and Ayala Pharmaceuticals, Inc. (formerly Advaxis, Inc.) (“Ayala”), the Company completed the acquisition of the Lm -based immune-oncology programs and related intellectual property assets (the “HER2 Assets”) from Ayala, including the assignment by Ayala of a license agreement with the Trustees of the University of Pennsylvania. The transaction was accounted for as an asset acquisition in accordance with ASC 805. In connection with the acquisition, the Company assumed certain specified liabilities and paid an aggregate purchase price of $ 8,000,000 , with a fair value of $ 6,864,438 , consisting of: (i) $ 400,000 to Ayala ($ 150,000 of which was transferred upon signing of the HER2 Purchase Agreement and the remainder on the closing date); (ii) $ 100,000 to a third party on behalf of Ayala on the closing date; and (iii) $ 7,500,000 worth of shares of common stock, or 4,774,637 shares based on the volume-weighted average price of the Company’s common stock over the 30 trading days immediately preceding the closing date of $ 1.5708 . The fair value of the common stock issued was determined using the closing price of $ 1.34 per share on April 9, 2025, resulting in a total equity value of $ 6,398,014 and a corresponding reduction in total purchase consideration. The fair value of the purchase consideration is summarized below: Cash $ 400,000 Legal fees paid on behalf of Ayala 66,424 Company common stock ( 4,774,637 shares at $ 1.34 per share) 6,398,014 Total fair value of consideration transferred $ 6,864,438 The acquired intangible assets consist primarily of a portfolio of patents and related licenses, including patents covering “Compositions and Methods for Evaluating Potency of Listeria-Based Immunotherapeutics,” which underpin the Company’s lead programs. These patents have an effective filing date of April 19, 2019 and an estimated remaining useful life of approximately 14 years. The assets are amortized on a straight-line basis over their estimated useful lives. Amortization expense was $ 360,305 and $ 0 for the years ended December 31, 2025 and 2024, respectively. 77 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (cont.) As of December 31, 2025, expected future amortization expense is as follows: Year 2026 $ 496,972 2027 496,972 2028 496,972 2029 496,972 2030 496,972 2031 and thereafter 4,019,272 Total $ 6,504,132 Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparison of the book values of the assets to future net undiscounted cash flows that the assets or the asset groups are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value, which is measured based on the estimated discounted future net cash flows arising from the assets or asset groups. No impairment losses on long-lived assets have been recorded for the year ended December 31, 2025 or the year ended December 31, 2024. Deferred Offering Costs Deferred offering costs consist of capitalized underwriting, legal, accounting and other expenses incurred through the balance sheet date that are directly related to the Company’s initial public offering and that were charged to stockholders’ equity upon the completion of such offering. As of December 31, 2025 and 2024, the Company had no capitalized deferred offering costs. Upon the completion of the Company’s initial public offering on August 2, 2024, all deferred offering costs were charged to stockholders’ deficit. Research and Development Costs Research and development expenses are charged to operations as incurred. Research and development expenses include, among other things, salaries, costs of outside collaborators and outside services, and supplies. Revenue Recognition As of the date of incorporation, the Company adopted ASU 2014-09, Revenue from Contracts with Customers , and all subsequent amendments to the ASU (collectively, “ASC 606”), which (i) creates a single framework for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize a gain (loss) from the transfer of nonfinancial assets. Stock-Based Compensation The Company, in accordance with ASC 718, employs the use of stock-based compensation. The compensation expense related to stock granted to employees and non-employees is measured at the grant date based on the estimated fair value of the award and is recognized on a straight-line basis over the requisite service period. Forfeitures are recognized as a reduction of stock-based compensation expense as they occur. Stock-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. 78 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (cont.) Short-term Leases For short-term leases with a term of 12 months or less, the Company recognizes lease expense on a straight-line basis over the lease term. The Company’s current lease arrangements qualify for this short-term lease exemption and are expensed as incurred. The Company did not renew its prior lease due to landlord restrictions related to renovations of the premises and has temporarily relocated its primary office to 115 Pullman Crossing Road, Suite #103, Grasonville, Maryland 21638. This space, which serves as the primary office of the Company’s Chief Financial Officer, is being provided at no cost. In May 2024, the Company entered into a month-to-month lease agreement with JLabs for general office space in New York City, primarily for meetings and use by staff when visiting. The monthly lease payment was $ 750 and increased to $ 787.50 effective January 1, 2025. Income taxes The Company accounts for income taxes using the asset-and-liability method in accordance with ASC 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis 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 years in which those temporary differences are expected to be recovered or settled. The effect on the deferred tax assets and liabilities of a change in tax rate is recognized in the period that includes the enactment date. A valuation allowance is recorded if it is “more likely than not” that some portion or all of the deferred tax assets will not be realized in future periods. The Company follows the guidance in ASC Topic 740-10 in assessing uncertain tax positions. The standard applies to all tax positions and clarifies the recognition of tax benefits in the consolidated financial statements by providing for a two-step approach of recognition and measurement. The first step involves assessing whether the tax position is more-likely-than-not to be sustained upon examination based upon its technical merits. The second step involves measurement of the amount to be recognized. Tax positions that meet the more-likely than-not threshold are measured at the largest amount of tax benefit that is greater than 50 % likely of being realized upon ultimate finalization with the taxing authority. The Company recognizes the impact of an uncertain income tax position in the consolidated financial statements if it believes that the position is more likely than not to be sustained by the relevant taxing authority. The Company will recognize interest and penalties related to tax positions in income tax expense. As of December 31, 2025 and December 31, 2024, the Company had no unrecognized uncertain income tax positions. 2025 2024 Deferred tax assets: Net operating loss carryforwards $ 9,900,522 $ 6,559,791 General business credit carryover 3,045,651 1,672,876 R&D credit (available for payroll tax offset) 268,568 268,568 Subtotal 13,214,741 8,501,235 Valuation allowance ( 13,214,741 ) ( 8,501,235 ) Total deferred tax assets $ - $ - Basic and Diluted Loss per Share The Company computes loss per share in accordance with ASC 260, Earnings per Share (“ASC 260”). ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the statements of operations. Basic EPS is computed by dividing the net loss available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible notes payable using the if-converted method. Diluted EPS excludes all diluted potential shares if their effect is antidilutive. 79 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (cont.) Below is a table listing all preferred stock and common stock equivalents: Common Stock Equivalents December 31, 2025 December 31, 2024 Series A Senior Convertible Preferred Stock 1,401,786 - Underwriter/Placement Agent Warrants 319,711 280,448 Inducement Warrants 7,154,338 - Prepaid Common Stock Not Issued 1,441,518 - Series A Warrants - 1,512,500 Total 10,317,353 1,792,948 The Series A Convertible Preferred Stock issued on December 31, 2024, is not reflected in the table above as of December 31, 2024, because stockholder approval was required for the issuance of common stock upon conversion. Stockholder approval was obtained on April 9, 2025, for the issuance of the shares of common stock underlying the Series A Preferred Stock, which is classified as mezzanine equity, and for the Series A Warrants. Upon approval, the conversion price of the Series A Preferred Stock and the exercise price of the Series A Warrants were automatically adjusted to $ 1.12 per share, based on the volume-weighted average price of the Company’s common stock for the 10 trading days immediately preceding April 9, 2025. This adjustment established a conversion multiplier of 3.571429 common shares per preferred share. As of December 31, 2025, 392,500 non-converted shares of Series A Preferred Stock were outstanding, which, using the conversion multiplier, are exercisable into 1,401,786 shares of common stock. As of December 31, 2025, a total of 319,711 shares of common stock were underlying outstanding underwriter and placement agent warrants, consisting of 112,000 shares issued in connection with the Company’s initial public offering and 207,711 shares issued to placement agents in connection with the PIPE financing in December 2024 and January 2025. During the Company’s two warrant exercise and inducement offerings, held June 23 to July 10, 2025, and August 29 to September 1, 2025, warrant holders who exercised their existing warrants received new warrants with an exercise price of $ 3.00 per share. In total, warrants to purchase 7,154,338 shares of common stock were exercised in exchange for new warrants to purchase an equal number of shares. Warrant holders who pre-funded conversions during the August 29 to September 30, 2025 offering received an aggregate of 937,500 prepaid shares of common stock and additionally funded 504,018 prepaid shares, resulting in a total of 1,441,518 prepaid warrants. 80 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (cont.) Fair Value Measurements The Company applies ASC 820 Fair Value Measurement (“ASC 820”), which establishes a framework for measuring fair value and clarifies the definition of fair value within that framework. ASC 820 defines fair value as an exit price, which is the price that would be received for an asset or paid to transfer a liability in the Company’s principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value hierarchy established in ASC 820 generally requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the entity’s own assumptions based on market data and the entity’s judgments about the assumptions that market participants would use in pricing the asset or liability and are to be developed based on the best information available in the circumstances. The carrying value of the Company’s cash, accounts payable, and accrued expenses are approximate fair value because of the short-term maturity of these financial instruments. The redemption feature of the debt instruments is recorded at fair value (See Note 3). Warrant liability is recorded at fair value. Currently, there is not an observable market for this type of derivative. Due to the lack of relevant and market reflective Level 1 and Level 2 inputs, the Company valued the warrant liability using Level 3 inputs, which require significant judgment and estimates on behalf of management in developing model assumptions. As of December 31, 2025 and December 31, 2024, the carrying value of the warrant liability in the aggregate was $ 0 and $ 1,971,975 , respectively (See Note 8). The valuation hierarchy is composed of three levels. The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The levels within the valuation hierarchy are described below: Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities. 81 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (cont.) Warrant Liability The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. The Series A Warrants issued in connection with a Securities Purchase Agreement, dated as of December 24, 2024 (the “Purchase Agreement”), are recognized as a derivative liability in accordance with ASC 815. The Company recognizes the warrant instruments as a liability at fair value and adjusts the instruments to fair value at each reporting period. The liability is subject to re-measurement at each balance sheet date until exercised or reclassified, and any change in fair value is recognized in the Company’s consolidated statements of operations. The fair value of the warrants issued in connection with the Purchase Agreement were measured using a Binomial simulation model. The determination of the fair value of the warrant liability may be subject to change as more current information becomes available and accordingly the actual results could differ significantly. The derivative warrant liability is classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or require the creation of current liabilities. Recent Accounting Pronouncements The Company has evaluated all recently issued accounting pronouncements and plans to adopt ASU 2024-03, Disaggregated Income Statement Disclosure, in the notes to its audited financial statements for the year ending December 31, 2026. In December 2023, the FASB issued final guidance in ASU No. 2023-09, Income Taxes (ASC 740): Improvements to Income Tax Disclosures requiring entities to provide additional information in the rate reconciliation and disclosures about income taxes paid. For the public business entities, the guidance is effective for annual periods beginning after December 15, 2024. No other recently issued accounting pronouncements are expected to have a material impact on the Company’s financial statements at this time. NOTE 3 — RELATED PARTY TRANSACTIONS Accrued Payroll As of December 31, 2025 and 2024, the Company had payroll payable to the CEO of $ 36,792 and $ 8,871 , respectively, and related payroll taxes payable of $ 1,279 and $ 88,386 , respectively. During the years ended December 31, 2025 and 2024, the Company made advances on payroll payable, and the CEO repaid amounts previously advanced. 82 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 3 — RELATED PARTY TRANSACTIONS (cont.) The following summarizes activity in respect to payroll advances to the CEO: Balance December 31, 2023 $ 191,198 Advances during 2024 222,875 Repayment ( 414,073 ) Balance December 31, 2024 $ - Advances during 2025 134,184 Repayments 2025 ( 134,184 ) Balance December 31, 2025 $ - During the second and third quarters of 2024, the Company issued paychecks to Paul Romness, CEO, representing the remaining balance of backpay, net of all 2024 payroll advances. Payroll taxes related to both backpay and regular compensation were fully paid. All related-party payroll advances to Mr. Romness, previously recorded as employee advances, were fully repaid during 2025. The balance of related-party payroll advances for Mr. Romness was $ 0 during 2025. All advances for 2024 were repaid in full as of December 31, 2024. Related Parties — Convertible Debt Mill River Partners LLC, an entity affiliated with Ted Search and John Ciccio, members of the Company’s board of directors, held convertible notes with face amounts of $ 0 as of December 31, 2025, and December 31, 2024. These notes were converted into shares of the Company’s common stock upon the closing of the Company’s initial public offering on August 2, 2024. Related Party Accounting Fees As of December 31, 2025 and 2024, the Company had accounts payable of $ 0 and $ 26,765 , respectively, to Shore Accountants MD Inc., an outside accounting firm that provides payroll, bookkeeping, and tax preparation services. Shore Accountants MD Inc. is wholly owned by Christopher Acevedo, the Company’s Chief Financial Officer. NOTE 4 — CONVERTIBLE DEBT Convertible Debt The Company’s convertible notes are separated into seven groups — A, B, C, D, E, F and BlinkBio — per the table below: December 31, 2025 December 31, 2024 Conversion Carrying Carrying Group Rate Maturity Collateral Rate Amount Amount A 10 % 10/31/2024 None 80 % - 87.5 % $ — $ — B 6 % 10/31/2024 None 80 % $ — $ — C 6 % 10/31/2024 None 80 % $ — $ — D 6 % 10/31/2024 None 50 % $ — $ — E 6 % 10/31/2024 None 50 % $ — $ — F 6 % 10/31/2024 None 50 % $ — $ — BlinkBio 10 % 3/15/2022 None 100 % $ — $ — The above convertible notes were all converted into common stock on August 2, 2024 upon consummation of the Company’s initial public offering. 83 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) Group A Commencing in July 2018 through November 2021, the Company entered into an unsecured Subordinated Convertible Promissory Note Agreement (the “Agreements”) with certain lenders (together, the “Holders” or individually, the “Holder”). Interest on the unpaid principal balance accrues at a rate of 10 % per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless earlier converted into shares of Equity Securities, the principal and accrued interest will be due and payable by the Company on demand by the Holders at any time after the earlier of (i) the Maturity Date (as defined in each Agreement) and (ii) the closing of the Next Equity Financing (as defined below). The stated Maturity Date was extended on October 24, 2023, under the same terms, until October 31, 2024. The Notes will automatically convert into the type of Equity Securities issued in the Next Equity Financing upon closing. The number of shares of such Equity Securities to be issued will be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on the Note on the date of conversion of 80 – 87.5 % of the price paid per share for Equity Securities by the investors in the Next Equity Financing. Equity Securities refers to Company’s common stock or preferred stock and Next Equity Financing refers to the next sale (or series of related sales) by the Company of its equity securities from which the Company receives gross proceeds of not less than $ 3,000,000 (including the aggregate amount of debt securities converted into Equity Securities upon conversion or cancellation of promissory notes) or $ 5,000,000 , depending upon the signed agreement terms. In the event that the Company raises aggregate additional cash proceeds of at least $ 3,000,000 or $ 5,000,000 through the sale of the Company’s equity securities, excluding the sales or conversions of Notes under the Agreement, the outstanding principal amount due will automatically, and without any action on part of the holder, be converted into fully paid and non-assessable units of the Company’s equity stock sold in such qualified financing at 12.5 % of the equity stock conversion price. The Company, at its option, may pay all accrued, but unpaid, interest and other charges in cash or by the issuance of additional equity stock at a rate of the applicable conversion price. The Company evaluated the Notes in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and determined the Notes are considered share-settled debt and should be recorded as a liability. This conclusion was determined based on the debt providing the holder with a variable number of shares at settlement with an aggregate fair value equal to the debt instrument’s outstanding principal. The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement (e.g., share-settled debt) to be carried at fair value unless other accounting guidance specifies another measurement attribute. It has been determined that the appropriate guidance for share-settled debt is ASC 835. As a result, the Notes were recorded at the amortized cost. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. As of December 31, 2025 and 2024, the balance of the convertible notes was $ 0 and $ 0 , respectively, as the notes were converted into 263,499 shares of the Company’s common stock in connection with the closing of the Company’s initial public offering on August 2, 2024. 84 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) Group B Commencing in May 2020, the Company entered into an unsecured Subordinated Convertible Promissory Note Agreement (the “Agreements”) with certain lenders (together, the “Holders” or individually, the “Holder”), pursuant to which the Company issued a Subordinated Convertible Promissory Note (individually the “Note” or together the “Notes”) to the Holders, principally the investors brought in by an investment bank. Interest on the unpaid principal balance accrues at a rate of 6 % per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless earlier converted into shares of Equity Securities, the principal and accrued interest will be due and payable by the Company on demand by the Holders at any time after the earlier of (i) the Maturity Date (as defined in each Agreement) and (ii) the closing of the Next Equity Financing (as defined below). The stated Maturity Date was extended on October 24, 2023, under the same terms, until October 31, 2024. The Notes will automatically convert into the type of Equity Securities issued in the Next Equity Financing upon closing. The number of shares of such Equity Securities to be issued will be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on the Note on the date of conversion of 80 % of the price paid per share for Equity Securities by the investors in the Next Equity Financing. Equity Securities refers to Company’s common stock or preferred stock and Next Equity Financing refers to the next sale (or series of related sales) by the Company of its equity securities from which the Company receives gross proceeds of not less than $ 10,000,000 (including the aggregate amount of debt securities converted into Equity Securities upon conversion or cancellation of promissory notes). In the event that the Company raises aggregate additional cash proceeds of at least $ 10,000,000 through the sale of the Company’s equity securities, excluding the sales or conversions of Notes under the Agreement, the outstanding principal amount due will automatically, and without any action on part of the holder, be converted into fully paid and non-assessable units of the Company’s equity stock sold in such qualified financing at 12.5 % of the equity stock conversion price. The Company, at its option, may pay all accrued, but unpaid, interest and other charges in cash or by the issuance of additional equity stock at a rate of the applicable conversion price. The Company evaluated the Notes in accordance with ASC 480 and determined the Notes are considered share-settled debt and should be recorded as a liability. This conclusion was determined based on the debt providing the holder with a variable number of shares at settlement with an aggregate fair value equal to the debt instrument’s outstanding principal. The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement (e.g., share-settled debt) to be carried at fair value unless other accounting guidance specifies another measurement attribute. It has been determined that the appropriate guidance for share-settled debt is ASC 835. As a result, the Notes were recorded at the amortized cost. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. As of December 31, 2025 and 2024, the balance of the convertible notes was $ 0 and $ 0 , respectively, as the notes were converted into 1,288,500 shares of the Company’s common stock in connection with the closing of the Company’s initial public offering on August 2, 2024. 85 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) Group C Commencing in July 2021, the Company entered into an unsecured Subordinated Convertible Promissory Note Agreement (the “Agreements”) with certain lenders (together, the “Holders” or individually, the “Holder”), pursuant to which the Company issued a Subordinated Convertible Promissory Note (individually the “Note” or together the “Notes”) to the Holders, principally the investors brought in by an investment bank. Interest on the unpaid principal balance accrues at a rate of 6 % per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless earlier converted into shares of Equity Securities, the principal and accrued interest will be due and payable by the Company on demand by the Holders at any time after the earlier of (i) the Maturity Date (as defined in each Agreement) and (ii) the closing of the Next Equity Financing (as defined below). The stated Maturity Date was extended on October 24, 2023, under the same terms, until October 31, 2024. The Notes will automatically convert into the type of Equity Securities issued in the Next Equity Financing upon closing. The number of shares of such Equity Securities to be issued will be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on the Note on the date of conversion of 80 % of the price paid per share for Equity Securities by the investors in the Next Equity Financing. Equity Securities refers to the Company’s common stock or preferred stock and Next Equity Financing refers to the next sale (or series of related sales) by the Company of its equity securities from which the Company receives gross proceeds of not less than $ 10,000,000 (including the aggregate amount of debt securities converted into Equity Securities upon conversion or cancellation of promissory notes). In the event that the Company raises aggregate additional cash proceeds of at least $ 10,000,000 through the sale of the Company’s equity securities, excluding the sales or conversions of Notes under the Agreement, the outstanding principal amount due will automatically, and without any action on part of the holder, be converted into fully paid and non-assessable units of the Company’s equity stock sold in such qualified financing at 12.5 % of the equity stock conversion price. The Company, at its option, may pay all accrued, but unpaid, interest and other charges in cash or by the issuance of additional equity stock at a rate of the applicable conversion price. The Company evaluated the Notes in accordance with ASC 480 and determined the Notes are considered share-settled debt and should be recorded as a liability. This conclusion was determined based on the debt providing the holder with a variable number of shares at settlement with an aggregate fair value equal to the debt instrument’s outstanding principal. The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement (e.g., share-settled debt) to be carried at fair value unless other accounting guidance specifies another measurement attribute. It has been determined that the appropriate guidance for share-settled debt is ASC 835. As a result, the Notes were recorded at the amortized cost. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. As of December 31, 2025 and 2024, the balance of the convertible notes was $ 0 and $ 0 , respectively, as the notes were converted into 986,250 shares of the Company’s common stock in connection with the closing of the Company’s initial public offering on August 2, 2024. 86 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) Group D Commencing in November 2022, the Company entered into an unsecured Subordinated Convertible Promissory Note Agreement (the “Agreements”) with certain lenders (together, the “Holders” or individually, the “Holder”), pursuant to which the Company issued a Subordinated Convertible Promissory Note (individually the “Note” or together the “Notes”) to the Holders, principally the Investors brought in by an investment bank. Interest on the unpaid principal balance accrues at a rate of 6 % per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless earlier converted into shares of Equity Securities, the principal and accrued interest will be due and payable by the Company on demand by the Holders at any time after the earlier of (i) the Maturity Date (as defined in each Agreement) and (ii) the closing of the Next Equity Financing (as defined below). The stated Maturity Date was extended on October 24, 2023, under the same terms, until October 31, 2024. The Notes will automatically convert into the type of Equity Securities issued in the Next Equity Financing upon closing. The number of shares of such Equity Securities to be issued will be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on the Note on the date of conversion of 50 % of the price paid per share for Equity Securities by the investors in the Next Equity Financing. Equity Securities refers to Company’s common stock or preferred stock and Next Equity Financing refers to the next sale (or series of related sales) by the Company of its equity securities from which the Company receives gross proceeds of not less than $ 10,000,000 (including the aggregate amount of debt securities converted into Equity Securities upon conversion or cancellation of promissory notes). In the event that the Company raises aggregate additional cash proceeds of at least $ 10,000,000 through the sale of the Company’s equity securities, excluding the sales or conversions of Notes under the Agreement, the outstanding principal amount due will automatically, and without any action on part of the holder, be converted into fully paid and non-assessable units of the Company’s equity stock sold in such qualified financing at 50 % of the equity stock conversion price. In connection with the Group D Convertible Notes, the Company agreed to issue an additional 125,000 shares of common stock to the Group D Holders, prorated based on such Holder’s investment amount, as an inducement for their investment in the Group D Convertible Notes. The Company, at its option, may pay all accrued, but unpaid, interest and other charges in cash or by the issuance of additional equity stock at a rate of the applicable conversion price. The Company evaluated the Notes in accordance with ASC 480 and determined the Notes are considered share-settled debt and should be recorded as a liability. This conclusion was determined based on the debt providing the holder with a variable number of shares at settlement with an aggregate fair value equal to the debt instrument’s outstanding principal. The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement (e.g., share-settled debt) to be carried at fair value unless other accounting guidance specifies another measurement attribute. It has been determined that the appropriate guidance for share-settled debt is ASC 835. As a result, the Notes were recorded at the amortized cost. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. 87 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) As of December 31, 2025 and 2024, the balance of the convertible notes was $ 0 and $ 0 , respectively, as the notes were converted into 500,000 shares of the Company’s common stock in connection with the closing of the Company’s initial public offering on August 2, 2024. Group E Commencing in February 2023, the Company entered into an unsecured Subordinated Convertible Promissory Note Agreement (the “Agreements”) with certain lenders (together, the “Holders” or individually, the “Holder”), pursuant to which the Company issued a Subordinated Convertible Promissory Note (individually the “Note” or together the “Notes”) to the Holders, principally the investors brought in by an investment bank. Interest on the unpaid principal balance accrues at a rate of 6 % per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless earlier converted into shares of Equity Securities, the principal and accrued interest will be due and payable by the Company on demand by the Holders at any time after the earlier of (i) the Maturity Date (as defined in each Agreement) and (ii) the closing of the Next Equity Financing (as defined below). The stated Maturity Date was extended on October 24, 2023, under the same terms, until October 31, 2024. The Notes will automatically convert into the type of Equity Securities issued in the Next Equity Financing upon closing. The number of shares of such Equity Securities to be issued will be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on the Note on the date of conversion of 50 % of the price paid per share for Equity Securities by the investors in the Next Equity Financing. Equity Securities refers to Company’s common stock or preferred stock and Next Equity Financing refers to the next sale (or series of related sales) by the Company of its equity securities from which the Company receives gross proceeds of not less than $ 10,000,000 (including the aggregate amount of debt securities converted into Equity Securities upon conversion or cancellation of promissory notes). In the event that the Company raises aggregate additional cash proceeds of at least $ 10,000,000 through the sale of the Company’s equity securities, excluding the sales or conversions of Notes under the Agreement, the outstanding principal amount due will automatically, and without any action on part of the holder, be converted into fully paid and non-assessable units of the Company’s equity stock sold in such qualified financing at 50 % of the equity stock conversion price. In connection with the Group E Convertible Notes, the Company agreed to issue an additional 68,750 shares of common stock to the Group E Holders, prorated based on such Holder’s investment amount, as an inducement for their investment in the Group E Convertible Notes. 88 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) The Company, at its option, may pay all accrued, but unpaid, interest and other charges in cash or by the issuance of additional equity stock at a rate of the applicable conversion price. The Company evaluated the Notes in accordance with ASC 480 and determined the Notes are considered share-settled debt and should be recorded as a liability. This conclusion was determined based on the debt providing the holder with a variable number of shares at settlement with an aggregate fair value equal to the debt instrument’s outstanding principal. The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement (e.g., share-settled debt) to be carried at fair value unless other accounting guidance specifies another measurement attribute. It has been determined that the appropriate guidance for share-settled debt is ASC 835. As a result, the Notes were recorded at the amortized cost. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. As of December 31, 2025 and 2024, the balance of the convertible notes was $ 0 and $ 0 , respectively, as the notes were converted into 262,500 shares of the Company’s common stock in connection with the closing of the Company’s initial public offering on August 2, 2024. Group F Commencing in June 2023, the Company entered into an unsecured Subordinated Convertible Promissory Note Agreement (the “Agreements”) with certain lenders (together, the “Holders” or individually, the “Holder”), pursuant to which the Company issued a Subordinated Convertible Promissory Note (individually the “Note” or together the “Notes”) to the Holders, principally the investors brought in by an investment bank. Interest on the unpaid principal balance accrues at a rate of 6 % per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless earlier converted into shares of Equity Securities, the principal and accrued interest will be due and payable by the Company on demand by the Holders at any time after the earlier of (i) the Maturity Date (as defined in each Agreement) and (ii) the closing of the Next Equity Financing (as defined below). The stated Maturity Date was extended on October 24, 2023, under the same terms, until October 31, 2024. The Notes will automatically convert into the type of Equity Securities issued in the Next Equity Financing upon closing. The number of shares of such Equity Securities to be issued will be equal to the quotient obtained by dividing the outstanding principal and unpaid accrued interest due on the Note on the date of conversion of 50 % of the price paid per share for Equity Securities by the investors in the Next Equity Financing. Equity Securities refers to Company’s common stock or preferred stock and Next Equity Financing refers to the next sale (or series of related sales) by the Company of its equity securities from which the Company receives gross proceeds of not less than $ 10,000,000 (including the aggregate amount of debt securities converted into Equity Securities upon conversion or cancellation of promissory notes). 89 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) In the event that the Company raises aggregate additional cash proceeds of at least $ 10,000,000 through the sale of the Company’s equity securities, excluding the sales or conversions of Notes under the Agreement, the outstanding principal amount due will automatically, and without any action on part of the holder, be converted into fully paid and non-assessable units of the Company’s equity stock sold in such qualified financing at 50 % of the equity stock conversion price. In connection with the Group F Convertible Notes, the Company agreed to issue an additional 214,594 shares of common stock to the Group F Holders, prorated based on such Holder’s investment amount, as an inducement for their investment in the Group F Convertible Notes. The Company, at its option, may pay all accrued, but unpaid, interest and other charges in cash or by the issuance of additional equity stock at a rate of the applicable conversion price. The Company evaluated the Notes in accordance with ASC 480 and determined the Notes are considered share-settled debt and should be recorded as a liability. This conclusion was determined based on the debt providing the holder with a variable number of shares at settlement with an aggregate fair value equal to the debt instrument’s outstanding principal. The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement (e.g., share-settled debt) to be carried at fair value unless other accounting guidance specifies another measurement attribute. It has been determined that the appropriate guidance for share-settled debt is ASC 835. As a result, the Notes were recorded at the amortized cost. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. As of December 31, 2025 and 2024, the balance of the convertible notes was $ 0 and $ 0 , respectively, as the notes were converted into 773,805 shares of the Company’s common stock in connection with the closing of the Company’s initial public offering on August 2, 2024. Redemption Liability The fair value of the redemption liability was calculated under Level 3 of the fair value hierarchy, is determined based upon a Probability-Weighted of Expected Returns Model (“PWERM”). This PWERM was determined to be the most appropriate method of estimating the value of possible redemption or conversion outcomes over time, since the Company has not entered into a priced equity round through June 30, 2024. The fair value of the redemption liability is calculated using the initial value of the convertible note less the debt discount rate of 12.5 % in Group A, 20 % in Groups B and C, and 50 % in Groups D, E and F. The resulting redemption liability was amortized over the remaining life of the notes using interest rates of 10 % for Group A and 6 % for Groups B–F. Group A notes had a fixed term of three years, while Groups B–F had variable terms ranging from 12 months to three years. The Company retained the option to negotiate extended maturity dates for Groups B–F. On August 2, 2024, the Company consummated its initial public offering, and the convertible notes, including accrued interest, converted into shares of the Company’s common stock. The redemption liability was closed to stockholders’ equity on such date. 90 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) Fees Associated with Convertible Debt Raise The fees associated with the issuance of the convertible notes for Groups A, B, C and D consist of legal and investment banking fees. No related parties received any portion of these fees. These fees are capitalized and amortized over the life of the respective convertible notes using an effective interest rate of 10 % for Group A and 6 % for Groups B, C and D. Make-whole liability — Shares due Noble Capital In March 2020, the Company entered into an advisory agreement with Noble Capital under which, in lieu of cash compensation, the Company agreed to issue 4 % of its common stock, subject to an anti-dilution clause. The make-whole liability represents shares earned due to adjustments under the anti-dilution provision during 2020 and 2021. As of year-end 2021, the Company held an aggregate of 233,202 shares, valued at $ 408,413 , after issuing 200,000 shares in 2020. Advisory fee expense of $ 152,482 was recorded in 2021 to reflect the share value earned under the anti-dilution provision. In 2022, 70,624 shares were set aside to satisfy the anti-dilution clause, with an associated advisory fee expense of $ 282,496 recognized. On July 1, 2023, the make-whole liability for Noble Capital was contractually nullified and unwound, and the adjustment was reflected in the Consolidated Statements of Stockholders’ Deficit. In September 2024, Noble Capital and the Company settled various investment fees in dispute, as well as shares related to the anti-dilution clause that had expired. Under the settlement, Noble Capital received 320,033 shares of common stock and $ 50,000 in cash. Make-whole liability — Shares Officers & Directors In January 2023, the Company issued 350,000 shares of Class A common stock to officers, key employees, key advisors and directors, leaving 20,000 shares to be issued to Joacim Borg, a former director, with a value of $ 80,000 . On March 1, 2023, the Company hired Alan Musso, former CFO, and as part of his compensation, awarded him 12,500 shares of common stock at $ 4.00 per share, totaling $ 50,000 . This amount was reflected in the Company’s make-whole stock liability. Upon Mr. Musso’s resignation on June 30, 2023, Christopher Acevedo, the current CFO, assumed the role and was awarded the balance of Mr. Musso’s shares following the successful completion of the Company’s initial public offering. The Company’s make-whole share liability as of September 30, 2024 is summarized in the table below. Name Position # Shares Value Date Earned Alan Musso Former CFO 3,125 $ 12,500 March 1, 2023 Christopher Acevedo Current CFO 9,375 37,500 Upon IPO Joacim Borg Former Director 20,000 80,000 July 1, 2022 32,500 $ 130,000 All make-whole shares due to directors and officers were issued in October 2024. As a result, the balance of the make-whole stock liability was $ 0 as of December 31, 2025 and December 31, 2024. 91 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 4 — CONVERTIBLE DEBT (cont.) Warrants for Placement Agent — Noble Capital In March 2020, the Company entered into an advisory agreement with Noble Capital, under which, in lieu of cash remuneration, it was granted a 10 % warrant fee in addition to cash compensation for debt raises from investments procured by Noble Capital. The warrants have a five-year term, with an exercise price equal to the average price paid by the convertible debt holders in each respective debt raise round. The warrants earned were as follows: ● 2020: 248,855 warrants, valued at $ 248,855 ● 2021: 213,782 warrants, valued at $ 427,564 ● 2022: 162,644 warrants, valued at $ 325,288 No warrants were earned from 2023 through December 31, 2024. Warrants issued in 2020, 2021, and 2022 were accounted for as a discount to the related convertible debt, with the discount amortized over the life of the debt. Debt discount accretion expense for these warrants was $ 0 for the year ended December 31, 2025, and $ 49,840 for the year ended December 31, 2024. The total unamortized warrant discount was $ 0 as of both December 31, 2025 and December 31, 2024. In September 2024, Noble Capital warrant holders exercised 116,313 warrants in a cashless transaction, and in December 2024, the remaining 294,977 warrants were exercised in a reduced cashless transaction, resulting in the issuance of common stock. Warrants for Underwriter and Placement Agents — Brookline Capital Markets and Ceros Financial Services, Inc. On August 2, 2024, the Company issued a warrant to Brookline Capital Markets to purchase 112,000 shares of the Company’s common stock pursuant to an underwriting agreement. The warrant became exercisable 180 days after July 31, 2024, expires on July 31, 2029, and has an exercise price of $ 4.40 per share. On December 24, 2024, in connection with the Company’s Purchase Agreement, Brookline earned warrants initially exercisable for 39,918 shares at $ 4.40 per share. These warrants were subsequently adjusted to 156,821 shares at an exercise price of $ 1.12 per share, subject to further adjustment as provided in the agreement. The warrants are exercisable for five years from April 9, 2025. As of December 31, 2025, warrants to purchase 156,821 shares remained outstanding. Ceros, in connection with the same Purchase Agreement, earned warrants initially exercisable for 13,951 shares at $ 4.40 per share, which were subsequently adjusted to 54,807 shares at $ 1.12 per share, also subject to further adjustment under the agreement. These warrants are exercisable for five years from April 9, 2025. As of December 31, 2025, 52,872 warrants remained outstanding. Short-Term Loan An investor lent the Company $ 100,000 on March 7, 2024. The note is a demand note, carrying interest at 8 % and was used for working capital purposes. An investor lent the Company $ 150,000 on June 28, 2024. The note is a demand note, carrying interest at 8 % and was also used for working capital purposes. The Company repaid these loans, including accrued interest thereon, in August 2024. 92 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 5 — TEDCO GRANT In May of 2021, the Company received the first of two tranches from TEDCO’s Rural & Underserved Business Recovery from Impact of COVID-19 (RUBRIC) Grant in the amount of $ 50,000 . A second tranche of $ 50,000 was received in October 2021 for a total reimbursable grant amount of $ 100,000 . The Company is obligated to report on and pay to TEDCO 3% of their quarterly revenues for a five-year period following the reward date. Income from grants and investments are not considered revenues. Royalties due to TEDCO are capped at 150 % of the amount of the award or $ 150,000 total. The Company has the option to eliminate the quarterly royalty obligation by making an advance payment prior to the end of the five-year period, in which case, the Company will receive a 10 % reduction of the royalty cap percentage for each year prior to the expiration of the five-year reimbursement period that the grant is repaid in full. If the Company ceases to meet eligibility requirements the reimbursement obligation will become due to TEDCO immediately; however, the discount for meeting the obligation will still apply. NOTE 6 — COMMITMENTS AND CONTINGENCIES Employee Commitments There are no employee commitments as the Company operates on an At-Will employment basis. Rental Agreement The Company rents a virtual office on a month-to-month basis at JLabs in New York, New York, a facility owned by Johnson & Johnson. The current monthly rent is $ 787.50 . Rent expense for the years ended December 31, 2025 and 2024 was $ 10,390 and $ 1,750 , respectively. License Obligation and Manufacturing Agreements Advaxis (now Ayala) In September 2018, the Company entered into an exclusive license agreement with Advaxis, Inc., as amended, under which it acquired the rights to develop and commercialize the Advaxis HER2 Construct, including related patents. Under the agreement, all milestone payments were non-refundable, non-creditable and payable only once upon the achievement of the corresponding milestone. As of December 31, 2020, the first milestone was achieved and paid ($ 1,550,000 ) in January 2021. The second milestone was completed and paid ($ 1,375,000 ) in May 2021. No milestone payments were made for the year ended December 31, 2025 or December 31, 2024. The license agreement was terminated upon the Company’s purchase of the HER2 Assets from Ayala on April 9, 2025, which included a payment of $ 400,000 and the issuance of common stock as consideration. 93 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 6 — COMMITMENTS AND CONTINGENCIES (cont.) BlinkBio In July 2020, the Company entered into a Licensing Agreement with BlinkBio, Inc., to utilize their proprietary technology. As of August 2020, the $ 300,000 License fee was fully paid and recorded in license expense. These payments have been recorded in the Licensing expenses of the accompanying statement of operations. No payments were due or made in 2024 or 2025. The Company is currently conducting early-stage research on the licensed drug, including studies to support future toxicology evaluations. A payment schedule for future milestones is summarized below. Milestone Bearing Event Milestone Payment 1. License Fee to utilize proprietary technology (paid) $ 300,000 + $ 2.4 million Convertible Note 2. Commencement of a toxicology study commented pursuant to Good Laboratory Practices (per 21 CFR Part 58) such that any resulting positive data would be admissible to applicable Regulatory Authorities to support an IND (commonly referred to as “GLP-Tox”) $ 375,000 3. Completion of a Phase I Clinical Trial $ 1,500,000 4. Completion of a Phase II Clinical Trial $ 2,500,000 5. Filing of an NDA, BLA or MAA registration (or the equivalent in any other territory around the world) $ 6,000,000 6. Regulatory Approval in the first of the United States, within the EU or within the UK $ 12,000,000 The Company will make the cash payments set forth in the table above by wire transfer of immediately available funds, to BlinkBio within 30 days of the occurrence of each milestone set forth with respect to the first Product to attain each such milestone, except that the first Milestone above will apply with respect to The Company’s first product candidate. During the Royalty Term, the Company will pay BlinkBio a royalty of 6 % on Net Sales on a Product-by-Product and country-by-country basis during the Royalty Term, in a country in which no Valid Claim Covers the manufacture, use, or sale of a Product, the royalty on Net Sales of such Product in such country will be reduced to 3 %. No royalties were due in the years ended December 31, 2025 and 2024. For the avoidance of doubt, each milestone payment will be payable only once, and the aggregate amount of Milestone payments payable hereunder will not exceed $ 22,375,000 . A Milestone may be achieved by the Company or a Commercial Sublicensee. 94 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 6 — COMMITMENTS AND CONTINGENCIES (cont.) George Clinical Inc. In June 2020, the Company entered into a Research Service Agreement, as amended, with George Clinical Inc., to use their clinical research services for the Company’s study: “ An Open Label, Phase 2 Study of Maintenance Therapy with OST-HER2 after Resection of Recurrent Osteosarcoma ”. Under the terms of the agreement, the Company was required to pay to George Clinical certain fees described in the fee schedule below. The total budget under the agreement was approximately $ 2,436,928 . For the years ended December 31, 2025 and 2024, the total research and development expenses recorded in the statement of operations was $ 0 and $ 86,687 , respectively. The fee schedule for certain fees and corresponding payment amounts is set forth below. George Clinical Payment Schedule Payment Amount 1. Service Fee Advance (paid) $ 49,989 2. Service Fee Advance of $212,335 minus the amount already paid, plus PTC Fee Advance of $31,325 (paid) $ 193,671 3. Statistics Fees – 35% on Electronic Data Capture (EDC) Go Live Date $ 47,740 4. Statistics Fees – 35% on Development of SAP tables $ 47,740 5. Statistics Fees – 30% on Final Analysis $ 40,920 6. Service Fees – Remainder Due Split monthly over course of study George Clinical tracked and invoiced the Company for the number of task units completed and pass-through costs were invoiced each month in arrears based on actual costs without mark-up. The PTC Advance Fee was used to offset final pass-through fees payable. As of December 31, 2025, the balance payable to George Clinical was $ 0 , and the services agreement has terminated in accordance with its terms. All fees due under the agreement have been satisfied, and no further obligations to the vendor remain. Biolacuna Ltd The Company has contracted with Biolacuna Ltd, a global life sciences advisory firm, to assist with the following agencies requirements to register OST-HER2 and gain approval of its use in the respective regions: ● European Medicines Agency (EMA, Europe); ● Medicines Evaluation Board (MEB, Netherlands); ● Medicines and Healthcare products Regulatory Agency (MHRA, United Kingdom); and ● U.S. Food and Drug Administration (FDA, United States). 95 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 6 — COMMITMENTS AND CONTINGENCIES (cont.) For the year ended December 31, 2025, the Company paid $ 11,629,063 in consulting fees, which includes refundable value-added tax (VAT) expenses. As of December 31, 2025, accounts payable related to consulting fees and VAT totaled $ 7,323,386 . Trustees of the University of Pennsylvania On April 9, 2025, the Company acquired from Ayala the HER2 Assets. Pursuant to the terms of the HER2 Purchase Agreement, the amended and restated development, license and supply agreement with Advaxis terminated. In connection with the acquisition of the HER2 Assets, the Company was assigned by Ayala a license agreement with the Trustees of the University of Pennsylvania covering the use of HER2 construct patents. Under the terms of the license agreement, the Company is required to pay an annual license fee to the Trustees of the University of Pennsylvania. In April 2025, the Company paid a fee of $ 266,317 for the year ended December 31, 2025. In addition, the Company is obligated to pay a royalty equal to 1.5 % of net sales related to: ● OST-HER2-related sales; ● ADXS-503-related sales; ● ADXS-504-related sales; and ● Sales related to any new immunotherapy drug candidates created from the Lm platform during the term of such licensing agreement. Legal Proceedings From time to time, the Company may be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of business. Any of these claims could subject the Company to costly legal expenses and, while management generally believes that there will be adequate insurance to cover different liabilities at such time the Company becomes a public company and commences clinical trials, the Company’s future insurance carriers may deny coverage or policy limits may be inadequate to fully satisfy any damage awards or settlements. If this were to happen, the payment of any such awards could have a material adverse effect on the results of operations and financial position. Additionally, any such claims, whether or not successful, could damage the Company’s reputation and business. The Company is currently not a party to any legal proceedings, the adverse outcome of which, in management’s opinion, individually or in the aggregate, could have a material adverse effect on the Company’s results of operations or financial position. The Company recently participated in an arbitration hearing related to a claim brought by its former investment advisor concerning underwriter compensation for the Company’s initial public offering in August 2024 and any subsequent equity offerings during the following 12 months. The hearing concluded on November 7, 2025, and the arbitrators issued a ruling on January 28, 2026, awarding the former investment advisor $ 1,055,428 and their attorneys $ 308,804.88 . The Company also incurred $ 15,128.32 in arbitration-related fees. The total amount of $ 1,379,361.20 has been accrued in the Company’s financial statements as of December 31, 2025 and is recorded as Other expense, payable in 2026. The Company does not intend to challenge the ruling. In accordance with ASC 450, the obligation is considered both probable and reasonably estimable. 96 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 7 — EQUITY Common Stock In 2021, the Company’s common stock was initially split into two classes: 50,000,000 shares of Class A common stock, $ 0.001 par value per share (“Class A Common Stock”), and 20,000,000 shares of Class B common stock, $ 0.001 par value per share (“Class B Common Stock”). On February 9, 2024, the Company combined the two classes under the name common stock with 50,000,000 shares authorized. On October 21, 2025, stockholders approved an increase in authorized common stock from 50,000,000 to 150,000,000 shares. As of December 31, 2025 and 2024, the Company had 37,113,082 and 20,869,908 shares of common stock outstanding, respectively. Common stock has voting rights . On August 2, 2024, the Company consummated its initial public offering and sold 1.6 million shares of common stock at a price of $ 4.00 per share. Concurrent with this consummation, all outstanding convertible notes, including accrued interest thereon, automatically converted into approximately 13.2 million shares of common stock, at conversion prices ranging from $ 0.39 per share to $ 2.59 per share, after applying share discounts ranging from 50 % to 87.5 % and valuation ceilings ranging from $ 5 million to $ 50 million, as applicable. During the three months ended March 31, 2025, the Company issued (i) 157,407 shares of common stock in connection with its equity line of credit, (ii) 300,000 shares of common stock to a scientific and technical advisor in exchange for scientific and technical services, which will be amortized over a 12-month period with the remaining balance in prepaid expenses, and (iii) 20,000 shares of common stock to an advisor in exchange for services. During the three months ended June 30, 2025, the Company issued (i) 3,962,129 shares of common stock in connection with conversions of Series A Preferred Stock, (ii) 2,164,215 shares of common stock in connection with the purchase of the HER2 Assets, (iii) 2,166,381 pre-funded warrants in connection with the purchase of the HER2 Assets, (iv) 10,000 shares of common stock to an advisor in exchange for services and (v) 2,181,257 shares of common stock in connection with the Company’s warrant exercise inducement and exchange offering. During the three months ended September 30, 2025, the Company issued (i) 977,679 shares of common stock in connection with conversions of Series A Preferred Stock, (ii) 2,507,386 shares of common stock in connection with the Company’s warrant exercise inducement and exchange offering and (iii) 120,000 shares of common stock to an advisor in exchange for services. Additionally, the Company received $ 1,050,000 in gross proceeds, which was recorded as additional paid-in capital, from the exercise of Series A Warrants to purchase 937,500 shares of common stock, which were issued subsequent to September 30, 2025. During the three months ended December 31, 2025, the Company issued (i) 950,000 shares of common stock in connection with its warrant exercise inducement and exchange offering related to pre-funded warrants, (ii) 2,610,422 shares of common stock upon exercise of the pre-funded warrant issued in connection with the purchase of the HER2 Assets, and (iii) 282,679 shares of common stock sold pursuant to the Company’s ATM program. Additionally, in three months ended December 31, 2025, the Company received $ 1,426,109 in gross proceeds from the exercise of Series A Warrants to purchase 1,441,518 shares of common stock at a future date. These proceeds were recorded as additional paid-in capital and are reflected in the Company’s warrant register. 97 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 7 — EQUITY (cont.) Preferred Stock In 2021, the Company authorized 5,000,000 shares of Preferred Stock, of which 1,400,000 were designated as Series A Preferred Stock. A total of 1,302,082 shares of Series A Preferred Stock were issued, which carried a 5 % cumulative dividend and liquidation preference over common stock. Dividends were computed at 5 % of the principal annually and recorded monthly. On February 9, 2024, all outstanding Series A Preferred Stock was converted into common stock on a one-for-two basis pursuant to the filing of the Company’s third amended and restated certificate of incorporation. As of that date, the Company had 5,000,000 shares of authorized Preferred Stock, with none outstanding. The Series A Preferred Stock dividend for the year ended December 31, 2025 was $ 0 , and for the year ended December 31, 2024 was $ 31,250 , resulting in a total accrued dividend payable of $ 375,000 as of December 31, 2025. The Preferred Stock has the following rights and privileges: Voting — Votes together with the common stock on all matters on an as-converted basis. Approval of a majority of the New Preferred Stock voting as a separate class will be required to, among other things: (i) adversely change rights of the New Preferred Stock, (ii) change the authorized number of shares of New Preferred Stock. Conversion — Each share of New Preferred Stock is convertible into one share of common stock (subject to proportional adjustments for stock splits, stock dividends and the like) at any time at the option of the holder. Conversion ratio will be subject to adjustment on a broad-based, weighted average basis in the event of subsequent issuances at a price less than the original issue price (as adjusted) subject to customary exceptions. The conversion into common stock occurred on February 9, 2024. Liquidation — One times the original issue price of the New Preferred Stock plus declared but unpaid dividends on each share of New Preferred Stock (or, if greater, the amount that the New Preferred Stock would receive on an as-converted basis) will be paid first on each share of New Preferred Stock, and the balance of proceeds to be paid to common stock. A merger, reorganization, or similar transaction (including a sale, exclusive license or other disposition of all or substantially all of the assets of the Company or its subsidiaries) will be treated as a liquidation, thereby triggering payment of the liquidation preference described above. For the avoidance of doubt, the liquidation preference is intended to provide the Investor (and its permitted assigns) with an aggregate liquidation payment of $ 2,500,000 . 98 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 7 — EQUITY (cont.) Stock Options The following table summarizes the common stock options issued to employees and consultants for services during the year ended December 31, 2025: Common Stock Options Shares Weighted Average Exercise Price Weighted Average Remaining Years Intrinsic Value Outstanding at January 1, 2025 2,866,750 $ 1.86 4 .92 - Granted 3,904,500 $ 1.80 5.00 - Forfeited - - - - Exercised - - - - Outstanding at December 31, 2025 6,771,250 $ 1.83 4.43 - Exercisable at December 31, 2025 2,866,750 $ 1.86 3.92 - The fair value of the options granted during the year ended December 31, 2025 was estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions: 2025 Volatility (based on peer companies) 112 % Risk Free Interest Rate 3.55 % Dividends None Estimated Life in years 2.88 During the years ended December 31, 2025 and 2024, the Company recognized combined share-based compensation expense of $ 4,265,374 and $ 268,300 , respectively, related to these common stock options. At the Company’s annual meeting on October 21, 2025, stockholders approved an amendment to the Company’s 2023 Incentive Compensation Plan, increasing the shares of common stock authorized for issuance thereunder from 4 million to 10 million. 99 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 8 — REDEEMABLE PREFERRED STOCK, MEZZAININE EQUITY AND WARRANT LIABILITY Securities Purchase Agreement On December 24, 2024, the Company entered into the Purchase Agreement with various institutional and accredited investors. The Company completed the initial closing on December 31, 2024 and sold an aggregate of 1,512,500 immediately separable units (the “Units”), each Unit consisting of (i) one share of the Company’s Series A Preferred Stock, and (ii) a Warrant to purchase one share of common stock, at a price per Unit of $ 4.00 . The Warrant has an exercise price of $ 4.40 per share, subject to adjustment therein, and a term of five years from the date stockholder approval of the common stock issuances contemplated by the Purchase Agreement is obtained. The gross proceeds from the initial closing to the Company, before deducting transaction fees and other estimated expenses, was $ 6,050,000 . On January 14, 2025 the Company sold and issued an additional 263,250 Units. The gross proceeds from the second closing to the Company, before deducting transaction fees and other estimated expenses, was $ 1,053,000 . Based on the terms of the Series A Preferred Stock and the Company’s Certificate of Designation, and in accordance with ASC 480, the Series A Preferred Stock is accounted for as mezzanine equity due to the redemption feature upon a deemed liquidation event: (i) a merger or consolidation, or (ii) the sale, lease, transfer or other disposition of substantially all the assets of the Company. $ 1,971,975 of the initial cash proceeds of $ 6,050,000 were allocated to the Warrants and $ 4,078,025 of the residual proceeds were allocated to the Series A Preferred Stock. $ 330,781 of the additional cash proceeds of $ 1,053,000 were allocated to the Warrants and $ 722,219 of the residual proceeds were allocated to the Series A Preferred Stock from the January 14, 2025 settlement, with all the same terms as the first settlement above. From April 9, 2025 through December 31, 2025, Mezzanine Equity converted into 4,939,808 shares of common stock. Of the original 1,775,750 shares of Series A Preferred Stock, 273,750 and 1,383,250 shares were converted during the three- and nine-month periods ended December 31, 2025, respectively. As of December 31, 2025, 392,500 shares of Series A Preferred Stock remain outstanding, convertible into 1,401,786 shares of common stock. Based on the terms of the Warrants and in accordance with ASC 815, the Warrants are accounted for as a liability due to the variable exercise price subject to adjustment. Currently, there is not an observable market for this type of derivative. Due to the lack of relevant and market reflective Level 1 and Level 2 inputs, the Company valued the Warrant liability using Level 3 inputs, which require significant judgment and estimates on behalf of management in developing model assumptions. The Company determined the value of the Warrant liability using a Binomial Simulation, which takes into consideration the fair market value of the Company’s stock, the variable nature of the exercise price, the estimated exercise period, the volatility of its common stock, and the risk-free interest rate. The following assumptions were made as of December 31, 2024 in the model: (1) a variable exercise price with a floor of $ 4.40 per share, (2) current common stock price of $ 4.28 per share December 31, 2024, (3) discount rate of 4.38 %, and (4) expected stock price volatility of 24.90 %. As of December 31, 2024, the carrying value of the Warrant liability in aggregate was $ 1,971,975 on December 31, 2024. The following assumptions were made as of January 14, 2025 in the model: (1) a variable exercise price with a floor of $ 4.40 per share, (2) current common stock price of $ 4.16 per share on January 14, 2025, (3) discount rate of 4.59 %, and (4) expected stock price volatility of 25.77 %. As of January 14, the carrying value of the 263,250 issued warrants was $ 330,781 . 100 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 8 — PREFERRED STOCK AND WARRANT LIABILITY (cont.) The following assumptions were made as of April 9, 2025 based on stockholder approval in the model for the aggregate warrants: (1) a fixed exercise price of $ 1.12 per share, which automatically reset and resulted in a reclassification of the warrant liability on April 9, 2025 to equity per ASC 815; (2) then-current common stock price of $ 1.34 per share on April 9, 2025; (3) discount rate of 4.06 %; and (4) expected stock price volatility of 23.26 %. As of December 31, 2025, the carrying value of the Warrant liability in aggregate was $0 . For the year ended December 31, 2025, the Company recorded a gain on the change in fair value of the Warrant Liability in the amount of $ 1,424,603 and a $ 878,153 deduction due to reclassification to equity. As of December 31, 2025 and December 31, 2024, the carrying value of the Warrant liability in aggregate was $0 and $ 1,971,975 , respectively. The Series A Preferred Stock and Warrants were issued in a basket transaction. When two or more instruments are issued in a basket transaction and some instruments will be remeasured at fair value, the proceeds are first allocated to the instruments recorded at their fair value. Next, the residual method is used to allocate the proceeds to the instrument(s) that are not remeasured at fair value. In this case, the Warrant is subsequently measured at fair value, and the Series A Preferred Stock instrument is measured at initial carrying value. The Company will first allocate the proceeds to the Warrant liability, with the residual allocated to the Series A Preferred Stock liability. The following tables reflect the allocation of the cash proceeds and changes in Warrant Liability in the consolidated statement of operations as of and for the period from December 31, 2024 to December 31, 2025. As of December 31, 2025 Cash proceeds $ 7,103,000 Fair value of Warrant liability ( 2,302,756 ) Residual value allocated to Series A Preferred Stock ( 4,800,244 ) Unallocated cash proceeds $ - For the year ended December 31, 2025 Warrant Liability as of December 31, 2024 $ 1,971,975 Additional Warrant Liability on January 14, 2025 330,781 Gain on the change in fair value of Warrant Liability as of March 31, 2025 ( 1,122,561 ) Warrant Liability as of March 31, 2025 1,180,195 Gain on the change in fair value of Warrant Liability as of April 9, 2025 ( 302,042 ) Stockholder approval on April 9, 2025 - warrants turn into Equity ( 878,153 ) Warrant Liability as of December 31, 2025 $ — 101 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 9 — SEGMENT AND GEOGRAPHIC INFORMATION The Company operates as one operating segment. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer , who reviews financial information presented on a consolidated basis. The CODM uses consolidated operating margin and net income to assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operating decisions, such as the determination of the rate at which the Company seeks to grow global operating margin and the allocation of budget between cost of revenues, sales and marketing, technology and development, and general and administrative expenses. The following table presents selected financial information with respect to the Company’s single operating segment for the years ended December 31, 2025 and 2023: December 31, December 31, 2025 2024 OPERATING EXPENSES Research and development $ 16,360,725 $ 2,839,060 General and administrative 12,344,976 3,974,786 Loss from operations ( 28,705,701 ) ( 6,813,846 ) OTHER INCOME (EXPENSE) Interest income 249 - Interest expense - ( 2,051,839 ) Non-operating income - 33,997 Non-operating expenses ( 1,472,995 ) ( 51,250 ) Change in fair value of warrant liability 1,424,603 - TOTAL OTHER INCOME (EXPENSE) ( 48,143 ) ( 2,069,092 ) NET LOSS ( 28,753,844 ) ( 8,882,938 ) NOTE 10 — SUBSEQUENT EVENTS Third Warrant Exercise Inducement and Exchange Offering — On January 14, 2026, the Company closed on a third warrant exercise inducement and exchange offer (the “Third Inducement Offering”). The Third Inducement Offering was made to less than 10 accredited investors that held certain existing warrants to purchase up to an aggregate of 5,382,148 shares of the Company’s common stock having a then current exercise price of $ 3.00 or $ 2.10 per share. Pursuant to certain inducement offer letter agreements, such holders exercised for cash their warrants to purchase 2,499,558 shares of the Company’s common stock at a reduced exercise price of $ 1.40 per share and in exchange the Company issued to such holders new warrants to purchase up to an aggregate of 2,499,558 shares of common stock at an exercise price of $ 1.40 per share, subject to adjustment as provided therein. Such new warrants are immediately exercisable from the date of issuance and have a term of exercise of five years from such date. The gross proceeds to the Company from the Third Inducement Offering, before deducting transaction fees and other offering expenses, were approximately $ 3.5 million. The Company agreed to file a registration statement on Form S-3 (or other appropriate form, including on Form S-1, if not then eligible to register securities on Form S-3) providing for the resale of the shares of common stock issued or issuable upon exercise of the new warrants issued within 30 calendar days of March 2, 2026, and to use commercially reasonable efforts to have such registration statement declared effective by the SEC within 60 calendar days (or within 90 calendar days in case of “full review” by the SEC) following its initial filing and to keep such registration statement effective at all times until the earlier of (i) the time no holder owns any new warrants or shares of common stock issuable upon exercise thereof and (ii) the Delegend Date (as defined in the inducement offer letter agreements entered into in connection with the Third Inducement Offering). 102 OS Therapies Incorporated Notes to the Consolidated Financial Statements For the Years Ended December 31, 2025 and 2024 NOTE 10 — SUBSEQUENT EVENTS (cont.) Privately Negotiated Warrant Exercise Inducement and Exchange Agreements – From January 10, 2026 through February 2026, the Company entered into privately negotiated inducement offer letters, pursuant to which certain remaining holders of existing warrants exercised for cash their warrants to purchase an aggregate of 74,108 shares of common stock at a reduced exercise price of $ 1.40 per share and in exchange the Company issued new warrants to purchase up to an aggregate of 74,108 shares of common stock at an exercise price of $ 1.40 per share, subject to adjustment as provided therein. Such new warrants are immediately exercisable from the date of issuance and have a term of exercise of five years from such date. The Company received gross proceeds of approximately $ 103,750 from the exercise of these warrants. The Company agreed to file a registration statement on Form S-3 (or other appropriate form, including on Form S-1, if not then eligible to register securities on Form S-3) providing for the resale of the shares of common stock issued or issuable upon exercise of these warrants on or before March 30, 2026, and to use commercially reasonable efforts to have such registration statement declared effective by the SEC within 60 calendar days (or within 90 calendar days in case of “full review” by the SEC) following its initial filing and to keep such registration statement effective at all times until the earlier of (i) the time no holder of these warrants owns any such warrants or shares of common stock issuable upon exercise thereof and (ii) the Delegend Date (as defined in the privately negotiated inducement offer letters). Bridge Financing – On March 4, 2026, pursuant to a securities purchase agreement (the “Bridge SPA”), the Company issued to certain accredited investors in a private placement transaction (i) 10.0 % original issue discount unsecured convertible promissory notes in an aggregate principal amount of $ 2,200,000 (the “Bridge Notes”) and (ii) warrants to purchase up to an aggregate of 1,666,667 shares of common stock (the “Bridge Warrants” and such private placement transaction, the “Bridge Financing”), for aggregate gross proceeds of $ 2,000,000 , before deducting placement agent fees and other Bridge Financing expenses. The Bridge Notes mature on March 4, 2027 and accrue interest at a rate of 4.0 % per annum. The Bridge Warrants were immediately exercisable upon issuance, expire five years from the date of issuance and have an exercise price of $ 1.40 per share, subject to adjustment as provided therein. The Bridge Notes were sold at a 10 % original issue discount, such that for each $ 100,000 invested by a purchaser, such purchaser received a Bridge Note in the principal amount of $ 110,000 . The Bridge Notes are convertible into shares of common stock under certain circumstances. If the Company completes a “Qualified Offering,” defined as a registered public offering or registered direct offering resulting in at least $ 2.5 million in gross proceeds from new money investments, the outstanding principal, together with all accrued and unpaid interest, will automatically convert into the securities sold in such offering at the offering price. Additionally, prior to any such Qualified Offering or repayment of the Bridge Notes, holders may elect to convert the Bridge Notes, in whole or in part, into shares of common stock at a conversion price equal to 90 % of the average daily volume-weighted average price of the Company’s common stock during the 10 trading days immediately preceding the holder’s conversion notice, subject to adjustment. The Company agreed to file a registration statement on Form S-3 (or Form S-1 if not then eligible to register securities for Form S-3) by April 3, 2026 to register for resale the shares of common stock issuable upon conversion of the Bridge Notes and exercise of the Bridge Warrants, and to use commercially reasonable efforts to cause such registration statement to become effective within 60 calendar days (or 90 calendar days in the case of a “full review” by the SEC) following its initial filing and to keep such registration statement effective at all times until the earlier of (i) the time that no investor owns any Bridge Notes, Bridge Warrants or shares underlying such Bridge Notes and Bridge Warrants or (ii) the Legend Removal Date (as defined in the Bridge SPA). Regulatory Meetings – During early 2026, the Company continued its regulatory engagement with the U.S. Food and Drug Administration (“FDA”) related to its Biologics License Application (“BLA”) for OST-HER2. As outlined in recent press releases, this included planned interactions with the FDA, including a Type D meeting that was elevated to a Type B pre-BLA meeting. These activities are consistent with the Company’s ongoing regulatory efforts. The Company does not believe these interactions currently have a measurable impact on its consolidated financial statements; however, the outcome of these discussions may affect future development timelines and regulatory strategy. 103 Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure. None.