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Item 7. Management’s Discussion and Analysis

2026-07-29 compared with 2025-08-11 · 366 added, 317 removed, 189 unchanged (78% of the section changed)

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Factors that could cause or contribute to such differences include,

but are not limited to, any factors discussed in this section as well as factors described in Part II, Item 1A.

but are not limited to, any factors discussed in this section as well as factors described in Part I, Item 1A.

“Risk Factors”

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We are working to advance clinical research and development of new cellular-based therapies

We are engaged preparing for a clinical trial

in LAPC using encapsulated live cells.

On September 1, 2020, we submitted an IND to the

FDA for our planned clinical trial in LAPC.

On October 1, 2020, we received notice from the FDA that it had placed our IND on clinical

On October 30, 2020, the FDA sent a letter to us setting forth the reasons for the clinical hold and specific guidance on what we

must do to have the clinical hold lifted.

We are engaged preparing for a clinical trial in LAPC

using encapsulated live cells.

On September 1, 2020, we submitted an IND to the FDA

for our planned clinical trial in LAPC.

On October 1, 2020, we received notice from the FDA that it had placed our IND on clinical hold.

On October 30, 2020, the FDA sent a letter to us setting forth the reasons for the clinical hold and specific guidance on what we must

do to have the clinical hold lifted.

To address our clinical hold, we assembled a team

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Business under the Section entitled, “Clinical Hold” of this Report.

Private Placement

On May 9, 2023, we entered into a securities purchase

agreement with certain accredited investors, pursuant to which we issued and sold, in a private placement (the “PIPE”), an

aggregate of (i) 35,000 Series B Preferred Shares, initially convertible into up to 8,750,000 shares of common stock at a conversion price

of $4.00 per share, and (ii) warrants (the “PIPE Warrants”) to acquire up to 8,750,000 shares of common stock at an exercise

price of $4.00 per share.

Each Series B Preferred Share and accompanying PIPE Warrants were sold together at a combined offering price

The terms of the Preferred Shares are as set forth in the Certificate of Designations of Series B Convertible Preferred Stock

of PharmaCyte Biotech, Inc.

(the “Certificate of Designations”), which was filed and became effective with the Secretary of

State of the State of Nevada on May 10, 2023.

The PIPE Warrants are immediately exercisable and expire 5 years from issuance.

In connection with the PIPE, we entered into a

registration rights agreement, pursuant to which we filed a Registration Statement on Form S-3 (File No.

333-272569) to register the resale

of the shares underlying the Series B Preferred Shares and the PIPE Warrants.

Such Registration Statement was declared effective by the

Commission on September 29, 2023.

The terms of the Preferred Shares are as set forth

in a Certificate of Designations (the “Certificate of Designations”), which was filed with the Secretary of the State of Nevada

on May 10, 2023.

The Preferred Shares are convertible into common stock (the “Conversion Shares”) at the election of the holder

at any time at an initial conversion price of $4.00 (the “Conversion Price”).

The Conversion Price is subject to customary

adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any

issuances of common stock, or securities convertible, exercisable or exchangeable for common stock, at a price below the then-applicable

Conversion Price (subject to certain exceptions).

We are required to settle the Preferred Shares in equal monthly installments, commencing

on November 9, 2023.

The amortization payments due upon such redemption are payable, at our election, in cash, or subject to certain limitations,

in shares of common stock valued at the lower of (i) the Conversion Price then in effect and (ii) the greater of (A) a 20% discount to

the average of the three lowest closing prices of our common stock during the thirty trading day period immediately prior to the date

the amortization payment is due or (B) the lower of $0.556 and 20% of the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq

Stock Market) on the date of receipt of Nasdaq Stockholder Approval (as defined below);

provided that if the amount set forth in clause

B is the lowest effective price, we will be required to pay the amortization payment in cash.

We may require holders to convert their

Preferred Shares into Conversion Shares if the closing price of the common stock exceeds $6.00 per share for 20 consecutive trading days

and the daily trading volume of the common stock exceeds 1,000,000 shares per day during the same period and certain equity conditions

described in the Certificate of Designations are satisfied.

The holders of the Preferred Shares are entitled

to dividends of 4% per annum, compounded monthly, which are payable in cash or shares of common stock at our option, in accordance with

the terms of the Certificate of Designations.

Upon the occurrence and during the continuance of a Triggering Event (as defined in the

Certificate of Designations), the Preferred Shares will accrue dividends at the rate of 15% per annum.

The holders of Preferred Shares

have no voting rights on account of the Preferred Shares, other than with respect to certain matters affecting the rights of the Preferred

Notwithstanding the foregoing, our ability to

settle conversions and make amortization payments using shares of common stock is subject to certain limitations set forth in the Certificate

of Designations, including a limit on the number of shares that may be issued until the time, if any, that our stockholders have approved

the issuance of more than 19.9% of the our outstanding shares of common stock in accordance with Nasdaq listing standards (the “Nasdaq

Stockholder Approval”).

We received Nasdaq Stockholder Approval at its special meeting of stockholders held on August 31, 2023.

Further, the Certificate of Designations contains a certain beneficial ownership limitation after giving effect to the issuance of shares

of common stock issuable upon conversion of, or as part of any amortization payment under, the Certificate of Designations or Warrants.

The Certificate of Designations includes certain

Triggering Events (as defined in the Certificate of Designations), including, among other things, the failure to file and maintain an

effective registration statement covering the sale of the holder’s securities registrable pursuant to a registration rights agreement

entered into by us and the Investors simultaneously with the Purchase Agreement and our failure to pay any amounts due to the holders

of the Preferred Shares when due.

In connection with a Triggering Event, each holder of Preferred Shares will be able to require us to

redeem in cash any or all of the holder’s Preferred Shares at a premium set forth in the Certificate of Designations.

As of April 30, 2025, all preferred shares were

redeemed and no remaining obligations exist.

Impairment of Intangible Asset

We perform an annual analysis of impairment of the

indefinite-lived assets at our fiscal year end as well as when a triggering event may have occurred.

As of April 30, 2025, the intangible

asset held by us relates to an IPR&D asset, the cells producing cytochrome P450, used in the treatment of pancreatic cancer with a

carrying value in the amount of $1,549,427.

As of April 30, 2026, we concluded that the IPR&D asset does not meet the requirements

to continue the carrying value of the asset.

We believe that a buyer of this technology would ascribe a de minimis value to this asset.

Therefore, we determined that as of April 30, 2026, there should be a full impairment of the $1,549,427 carrying value.

Series C Private Placement

On August 17, 2025, we entered into a Securities

Purchase Agreement (the “Series C Private Placement Agreement”) with certain accredited investors (the “Investors”)

in a private placement (the “Series C Private Placement”) of (i) an aggregate of 7,000 shares of our newly designated Series

C convertible preferred stock, par value $0.0001, with a stated value of $1,000 per share (the “Series C Preferred Stock”),

initially convertible into up to 7,000,000 shares of our common stock, par value $0.0001 per share at an initial conversion price of $1.00

and (ii) warrants (the “Series C Preferred Warrants”) to purchase up to an aggregate of 7,000,000 shares of Common Stock.

The closing of the Series C Private Placement occurred on August 19, 2025.

The aggregate gross proceeds from the Series C Private Placement

totaled $7,000,000.

In connection with the Series C Private Placement,

pursuant to an Engagement Letter (the “Engagement Letter”) between us and the Series C placement agent (the “Placement

Agent”), we agreed to pay the Placement Agent (i) a cash fee equal to 8.0% of the gross proceeds from the Series C Private Placement,

and (ii) warrants to purchase shares of Common Stock equal to 8.0% of the number of shares of common stock that the Preferred Stock are

initially convertible into, with an exercise price of $1.00 per share and a five-year term.

Further, pursuant to the Engagement Letter,

the Placement Agent is entitled to compensation with respect to any of our financings occurring during the term of the Engagement Letter

or within twelve months thereafter when such financing is provided by investors whom the Placement Agent introduced to us.

for any of our warrants that are issued to investors who are introduced to us by the Placement Agent in the Series C Private Placement

or were previously issued in connection with our May 2023 private placement and are exercised during the term of the Engagement Letter,

we shall pay the Placement Agent a cash fee equal to 8.0% of the net proceeds received by us from such warrant exercises.

The terms of the Series C Preferred Stock are

as set forth in the form of Certificate of Designations (the “Series C Certificate of Designations”).

The Series C Preferred

Stock are convertible into shares of Common Stock (the “Conversion Shares”) at the election of the holder at any time at an

initial conversion price of $1.00 (the “Conversion Price”).

The Conversion Price is subject to customary adjustments for stock

dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of Common

Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable Conversion Price

(subject to certain exceptions).

The conversion price was reduced to $0.95 after issuance pursuant to the full ratchet anti-dilution provisions

contained in the Series C Certificate of Designations.

The holders of the Series C Preferred Stock will

be entitled to dividends of 7% per annum, compounded quarterly, which will be payable in cash.

Upon the occurrence and during the continuance

of a Triggering Event (as defined in the Series C Certificate of Designations), the Series C Preferred Stock will accrue dividends at

the rate of 15% per annum.

The holders of Series C Preferred Stock are entitled to vote with holders of the Common Stock as a single class

on all matters that holders of Common Stock are entitled to vote upon, with the number of votes per Series C Preferred Share equal to

the stated value of such Series C Preferred Share divided by the then applicable Conversion Price;

provided, however that in no event

shall the then applicable Conversion Price be less than the “Minimum Price” (as defined in Nasdaq Listing Rule 5635) on the

date immediately prior to the date of the Series C Private Placement Agreement.

In October 2025, we held a special meeting of

stockholders (the “2025 Special Meeting”).

At the 2025 Special Meeting, our stockholders approved, for purposes of complying

with Nasdaq Listing Rule 5635(d), (the “Exchange Cap”) the issuance of shares of Common Stock underlying the Series C Preferred

Stock and Series C Preferred Warrants, which allows us to settle all Series C Preferred Stock conversions into shares of Common Stock.

The Series C Certificate of Designations contains a certain beneficial ownership limitation after giving effect to the issuance of shares

of Common Stock issuable upon conversion of the Series C Preferred Stock or Series C Preferred Warrants.

We obtained stockholder approval to remove the

Exchange Cap on October 30, 2025, upon which event the conversion floor price was adjusted to $0.19.

The Series C Certificate of Designations includes

certain Triggering Events (as defined in the Series C Certificate of Designations), including, among other things, our failure to pay

any amounts due to the holders of the Series C Preferred Stock when due.

In connection with a Triggering Event, each holder of Series

C Preferred Stock will be able to require us to redeem in cash any or all of the holder’s Series C Preferred Stock at a premium

set forth in the Series C Certificate of Designations.

Femasys Transaction

On November 14, 2023, we entered into a securities

purchase agreement (the “Femasys Purchase Agreement”) with Femasys Inc.

(“Femasys”), pursuant to which we purchased

from Femasys (i) senior unsecured convertible notes (the “Notes”) in an aggregate principal amount of $5,000,000, convertible

into shares of Femasys common stock, par value $0.001 per share (the “Femasys Shares”) at a conversion price of $1.18 per

share, (ii) Series A Warrants (the “Series A Warrants”) to purchase up to an aggregate of 4,237,288 Femasys Shares at an exercise

price of $1.18 per share, and (iii) Series B Warrants (the “Series B Warrants” and, together with the Series A Warrants, the

“Femasys Warrants”) to purchase up to an aggregate of 4,237,288 Femasys Shares at an exercise price of $1.475 per share (collectively,

the “Femasys Transaction”).

In June 2026, Femasys completed a 20 to 1 reverse

All amounts presented below are on a pre-split basis.

On November 14, 2023, we entered into a securities purchase agreement

(the “Femasys Purchase Agreement”) with Femasys Inc.

(“Femasys”), pursuant to which we purchased from Femasys

(i) senior unsecured convertible notes (the “Notes”) in an aggregate principal amount of $5,000,000, convertible into shares

of Femasys common stock, par value $0.001 per share (the “Femasys Shares”) at a conversion price of $1.18 per share, (ii)

Series A Warrants (the “Series A Warrants”) to purchase up to an aggregate of 4,237,288 Femasys Shares at an exercise price

of $1.18 per share, and (iii) Series B Warrants (the “Series B Warrants” and, together with the Series A Warrants, the “Femasys

Warrants”) to purchase up to an aggregate of 4,237,288 Femasys Shares at an exercise price of $1.475 per share (collectively, the

“Femasys Transaction”).

The Femasys Purchase Agreement contains certain

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two years after the date of issuance.

The initial annual interest payment was paid in stock.

The Notes are convertible into Femasys Shares

at our election at any time at an initial conversion price of $1.18.

The conversion price is subject to customary adjustments for stock

dividends, stock splits, reclassifications and similar corporate events.

Femasys agreed in the Femasys Purchase Agreement and the Notes

not to issue or sell any of its equity securities at a price below the then-current conversion price for a period of 18 months after closing,

subject to certain exceptions.

During the years ended April 30, 2025 and 2024, the Notes earned $300,000 and $137,500, respectively.

November 21, 2024, we received a settlement of twelve months of interest in the form of 315,790 shares of Femasys common stock.

value of the shares was measured at April 30, 2025, resulting in an unrealized gain of $66,316.

Beginning six months after issuance, Femasys may

require us to convert our Notes into Femasys Shares if the closing price of the Femasys Shares exceeds $2.36 per share (subject to adjustment

for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) for 10 consecutive trading days and

the daily dollar trading volume of the Femasys Shares exceeds one million dollars ($1,000,000) per day during the same period and certain

equity conditions described in the Notes are satisfied.

The Notes provide for certain events of default,

including, among other things, Femasys’ failure to file and maintain an effective registration statement covering the sale of the

securities registrable pursuant to a registration rights agreement and Femasys’ failure to pay any amounts due to us when due.

connection with an event of default, we will be able to require Femasys to redeem in cash any or all of our Notes at a premium of 115%.

Under the terms of the Notes, Femasys is subject

to certain affirmative and negative covenants regarding the incurrence of indebtedness, acquisition and investment transactions, the existence

of liens, the repayment of indebtedness, the payment of cash in respect of dividends, distributions or redemptions, and the transfer of

assets, among other matters.

The annual interest payments were paid in stock.

The Notes are convertible into Femasys Shares at

our election at any time at an initial conversion price of $1.18.

The conversion price is subject to customary adjustments for stock dividends,

stock splits, reclassifications and similar corporate events.

Femasys agreed in the Femasys Purchase Agreement and the Notes not to issue

or sell any of its equity securities at a price below the then-current conversion price for a period of 18 months after closing, subject

to certain exceptions.

During the years ended April 30, 2026 and 2025, the Notes earned interest of $162,500 and $300,000, respectively.

We received a settlement of twelve months of interest in the form of 379,747 and 315,790 shares, respectively, of Femasys common stock

on November 21, 2025 and 2024, respectively.

On November 21, 2025, we received $5 million in cash in full settlement of the Femasys Note.

The fair value of the 695,537 shares was measured at April 30, 2026, resulting in an unrealized loss of $412,306.

The Series A Warrants are exercisable for Femasys

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coordinate research activities.

TNF Transaction

QCLS Transaction

Series G Preferred Shares and Warrants

On May 20, 2024, we entered into a securities

purchase agreement (the “TNF Purchase Agreement”) with TNF Pharmaceuticals, Inc.

(f/k/a MyMD Pharmaceuticals, Inc.) (“TNF”),

pursuant to which we purchased from TNF (i) shares of TNF’s Series G Convertible Preferred Stock (the “TNF Preferred Shares”),

convertible into 3,854,626 shares of TNF’s common stock, par value $0.001 per share (the “TNF Common Shares”), (ii)

warrants to purchase up to 3,854,626 TNF Common Shares with a five-year term (the “Long-Term Warrants”) and (iii) warrants

to purchase up to 3,854,626 TNF Common Shares with an 18-month term (the “Short-Term Warrants” and, together with the Long-Term

Warrants, the “TNF Warrants”) for an aggregate purchase price of $7,000,000 (the purchase of the TNF Preferred Shares, the

Long-Term Warrants and the Short-Term Warrants, the “TNF Transaction”).

Pursuant to the TNF Purchase Agreement, we have

the right to participate in future sales of TNF’s equity and equity-linked securities until the second anniversary of the closing

or the date on which no TNF Preferred Shares remain outstanding, whichever is earlier.

Additionally, we have the right to nominate one

individual to serve on TNF’s board of directors until the Company no longer beneficially owns 20% of the TNF Common Shares on an

as-converted basis.

The terms of the TNF Preferred Shares are as set

forth a certificate of designations (the “TNF Certificate of Designations”), which TNF filed with the Secretary of State for

the State of Delaware on May 21, 2024.

The TNF Preferred Shares are convertible into TNF Common Shares at our election at any time at

an initial conversion price of $1.816.

The conversion price is subject to customary adjustments for stock dividends, stock splits, reclassifications

and the like, and subject to price-based adjustment in the event of any issuances of TNF Common Shares, or securities convertible, exercisable

or exchangeable for TNF Common Shares, at a price below the then-applicable conversion price (subject to certain exceptions).

2025, the conversion price was adjusted to $0.1832 per share as a result of stock option grants.

At any time after the issuance date of

the TNF Preferred Shares, TNF has the option to redeem in cash all or any portion of the outstanding TNF Preferred Shares then outstanding

at a premium upon notice to the Company.

Pursuant to the TNF Certificate of Designations,

we will be entitled to dividends of 10% per annum, compounded monthly, which will be payable in cash or in TNF Common Shares at our option.

Upon the occurrence and during the continuance of a Triggering Event (as defined in the TNF Certificate of Designations), the TNF Preferred

purchase agreement (the “QCLS Purchase Agreement”) with Q/C Technologies, Inc.

(f/k/a TNF Pharmaceuticals, Inc.) and (f/k/a

MyMD Pharmaceuticals, Inc.) (“QCLS”), pursuant to which we purchased from QCLS (i) shares of QCLS’s Series G Convertible

Preferred Stock (the “QCLS Preferred Shares”), convertible into 3,854,626 shares of QCLS’s common stock, par value $0.001

per share (the “QCLS Common Shares”), (ii) warrants to purchase up to 3,854,626 QCLS Common Shares with a five-year term (the

“Long-Term Warrants”) and (iii) warrants to purchase up to 3,854,626 QCLS Common Shares with an 18-month term (the “Short-Term

Warrants” and, together with the Long-Term Warrants, the “QCLS Warrants”) for an aggregate purchase price of $7,000,000

(the purchase of the QCLS Preferred Shares, the Long-Term Warrants and the Short-Term Warrants, the “QCLS Transaction”).

In April 2025, QCLS issued securities that caused

changes to the original terms of the Series G Preferred Stock.

The conversion and exercises prices were adjusted to $0.1832 per Series

G Preferred Share, the number of QCLS Series G Long-Term Warrants were adjusted to purchase 38,209,611 shares of QCLS Common

Shares and the number of QCLS Series G Short-Term Warrants were adjusted to purchase 38,209,611 shares of QCLS Common Shares.

2025, in connection with the QCLS’s 1-for-100 reverse stock split and pursuant to the stock combination event adjustment provisions

of the Series G Preferred Shares and QCLS Series G Warrants, the conversion price and the exercise price was adjusted to $3.3713 per share,

the 7,000 Series G Preferred Shares were adjusted to be convertible into 2,076,351 shares of QCLS Common Shares, and the number of QCLS

Series G Long-Term Warrants were adjusted to purchase 2,076,351 shares of QCLS Common Shares and the number of QCLS Series G Short-Term

Warrants were adjusted to purchase 2,076,351 shares of QCLS Common Shares.

On November 23, 2025, the QCLS Series G Short-Term

Warrants expired.

Pursuant to the QCLS Purchase Agreement, we have the

right to participate in future sales of QCLS’s equity and equity-linked securities until the second anniversary of the closing or

the date on which no QCLS Preferred Shares remain outstanding, whichever is earlier.

Additionally, we have the right to nominate one individual

to serve on QCLS’s board of directors until the Company no longer beneficially owns 20% of the QCLS Common Shares on an as-converted

The terms of the QCLS Preferred Shares are as set

forth a certificate of designations (the “QCLS Certificate of Designations”), which QCLS filed with the Secretary of State

for the State of Delaware on May 21, 2024.

The QCLS Preferred Shares are convertible into QCLS Common Shares at our election at any time

at an initial conversion price of $1.816.

The conversion price is subject to customary adjustments for stock dividends, stock splits,

reclassifications and the like, and subject to price-based adjustment in the event of any issuances of QCLS Common Shares, or securities

convertible, exercisable or exchangeable for QCLS Common Shares, at a price below the then-applicable conversion price (subject to certain

In April 2025, the conversion price was adjusted to $0.1832 per share as a result of stock option grants.

At any time after

the issuance date of the QCLS Preferred Shares, QCLS has the option to redeem in cash all or any portion of the outstanding QCLS Preferred

Shares then outstanding at a premium upon notice to the Company.

Pursuant to the QCLS Certificate of Designations,

we will be entitled to dividends of 10% per annum, compounded monthly, which will be payable in cash or in QCLS Common Shares at our option.

Upon the occurrence and during the continuance of a Triggering Event (as defined in the QCLS Certificate of Designations), the QCLS Preferred

Shares will accrue dividends at the rate of 15% per annum.

Upon conversion or redemption, we are entitled to receive a dividend make-whole

We will be entitled to vote with holders of the TNF Common Shares on as as-converted basis, with the number of votes to which

We will be entitled to vote with holders of the QCLS Common Shares on as as-converted basis, with the number of votes to which

we are entitled to be calculated assuming a conversion price of $2.253 per share.

TNF’s ability to settle conversions and make dividend

make-whole payments by issuing TNF Common Shares is subject to certain limitations set forth in the TNF Certificate of Designations.

The TNF Certificate of Designations includes certain

triggering events, including, among other things, the failure by TNF to file and maintain an effective registration statement covering

the sale of the securities registrable pursuant to a registration rights agreement and the failure by TNF to pay any amounts to us when

In connection with a triggering event, we will be able to require TNF to redeem in cash any or all of its TNF Preferred Shares at

a premium set forth in the TNF Certificate of Designations.

TNF is subject to certain affirmative and negative

QCLS’s ability to settle conversions and make

dividend make-whole payments by issuing QCLS Common Shares is subject to certain limitations set forth in the QCLS Certificate of Designations.

The QCLS Certificate of Designations includes certain

triggering events, including, among other things, the failure by QCLS to file and maintain an effective registration statement covering

the sale of the securities registrable pursuant to a registration rights agreement and the failure by QCLS to pay any amounts to us when

In connection with a triggering event, we will be able to require QCLS to redeem in cash any or all of its QCLS Preferred Shares

at a premium set forth in the QCLS Certificate of Designations.

QCLS is subject to certain affirmative and negative

covenants regarding the incurrence of indebtedness, the existence of liens, the repayment of indebtedness, the payment of cash in respect

of dividends (other than dividends pursuant to the TNF Certificate of Designations), distributions or redemptions, and the transfer of

of dividends (other than dividends pursuant to the QCLS Certificate of Designations), distributions or redemptions, and the transfer of

assets, among other matters.

The Long-Term Warrants are exercisable for TNF

The Long-Term Warrants are exercisable for QCLS

Common Shares immediately, at an initial exercise price of $1.816 per share and expire five years from the date of issuance.

The Short-Term

Warrants are exercisable for TNF Common Shares immediately, at an initial exercise price of $1.816 per share and expire 18 months from

Warrants are exercisable for QCLS Common Shares immediately, at an initial exercise price of $1.816 per share and expire 18 months from

the date of issuance.

The exercise price of each TNF Warrant is subject to customary adjustments for stock dividends, stock splits, reclassifications

and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of TNF Common

Shares or securities convertible, exercisable or exchangeable for TNF Common Shares at a price below the then-applicable exercise price

The exercise price of each QCLS Warrant is subject to customary adjustments for stock dividends, stock splits, reclassifications

and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of QCLS Common

Shares or securities convertible, exercisable or exchangeable for QCLS Common Shares at a price below the then-applicable exercise price

(subject to certain exceptions).

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Short-Term Warrants increased to 38,209,611 each.

In connection with the TNF Transaction, we entered

into a registration rights agreement with TNF, pursuant to which TNF was required to file a resale registration statement with the Commission,

registering 200% of the shares issuable pursuant to the TNF Preferred Shares and the TNF Warrants.

Increase in Authorized Shares

On September 6, 2023, pursuant to stockholder

approval received at a special meeting of stockholders, we filed with the Secretary of State of the State of Nevada a Certificate of Change

to our Articles of Incorporation, as amended, to increase the number of authorized shares of common stock from 133,333,334 to 200,000,000.

The Certificate of Change had no impact on the number of authorized shares of preferred stock, which remains at 10,000,000.

The Short-Term Warrants expired on November 23, 2025.

As of April 30, 2026, the price

of the Long-Term Warrants was adjusted to $3.3713 per share.

As a result, of the exercise price adjustment, the number of warrant shares

attributable to the Long-Term Warrants adjusted to 2,076,351.

In connection with the QCLS Transaction, we entered

into a registration rights agreement with QCLS, pursuant to which QCLS was required to file a resale registration statement with the Commission,

registering 200% of the shares issuable pursuant to the QCLS Preferred Shares and the QCLS Warrants.

Series H Preferred Shares and Warrants

On September 2, 2025, the Company entered into

a Securities Purchase Agreement (the “Series H SPA”) with QCLS.

Pursuant to the Series H SPA, the Company purchased (i) 3,000

shares of QCLS’s Series H Convertible Preferred Stock (the “Series H Preferred Shares” or “Series H Preferred

Stock”), at a stated value of $1,000 per Series H Preferred Share, with an initial conversion price of $5.00 which were initially

convertible into 600,000 shares of QCLS Common Shares;

(ii) warrants to purchase up to 600,000 shares of QCLS Common Shares with a five-year

term (“QCLS Series H Warrants”), for a total purchase price of $3,000,000.

In September 2025, in connection with the QCLS’s

1-for-100 reverse stock split and pursuant to the stock combination event adjustment provisions of the Series H Preferred Shares and QCLS

Series H Warrants, the conversion price and the exercise price was adjusted to $3.3713 per share, the 3,000 Series H Preferred Shares

were adjusted to be convertible into 889,864 shares of QCLS Common Shares and the number of QCLS Series H Warrants was adjusted to purchase

889,864 shares of QCLS Common Shares.

The Series H Preferred Stock is not considered

in substance common stock, and as such, the equity method of accounting does not apply.

The Company recorded its investment in Series

H Preferred Stock at its fair value as the Company did not elect the measurement alternative to account for the investment at cost less

Subsequent changes in fair value of the Series H Preferred Stock are recognized in earnings at each reporting period.

initial fair value of the Series H Preferred Stock of $3,483,000 was estimated utilizing a probability-weighted scenario model, with the

following inputs:

the fair value of QCLS Common Shares of $3.61, estimated equity volatility of 100.0%, the time to maturity of 1.49 years,

the redemption premium of 106%, the liquidation premium of 125%, the conversion price of $5.00 per share, a market interest rate of 19.51%,

a risk-free rate of 3.61%, dividend rate of 7.00% and dividend yield rate of 0%.

The QCLS Series H Warrants were determined to

meet the definition of a derivative and were required to be recorded at fair value in accordance with ASC 815.

Subsequent changes in the

fair value of the QCLS Series H Warrants are recognized in earnings, at each reporting date.

The issuance date fair value of the QCLS

Series H Warrants of $1,606,000 was determined utilizing the Black Scholes Merton Method using the following inputs:

the fair value of

QCLS Common Shares of $3.61, exercise price of $5.00;

dividend yield of 0%;

remaining term of 5.00 years;

equity volatility of 105.0%;

and a risk-free interest rate of 3.59%.

The total aggregated fair value of the QCLS Series

H Preferred Stock and the QCLS Series H Warrants of $5,089,000 exceeded the total purchase price of $3,000,000 by $2,089,000, which was

recognized as a gain on investment in QCLS on the consolidated statement of operations for the year ended April 30, 2026.

Performance Indicators

12 unchanged sentences

cells according to cGMP regulations to use in our planned clinical trial;

(vii) complete all of the tasked the FDA requires of us in order

(vii) complete all of the tasks the FDA requires of us in order

to have the clinical hold lifted;

17 unchanged sentences

million as of April 30, 2026, and approximately $19.5 million as of April 30, 2025.

The decrease in cash is attributable to our investment

in TNF, the redemption of preferred stock, the repurchase of our common stock pursuant to the Repurchase Programs, recorded as treasury

stock and our operating expenses.

Repurchase Programs

Pursuant to the First Repurchase Program, we may acquire

up to $10 million of our outstanding shares of common stock, as determined by a formula based on the market price of the common stock

and average daily volumes.

Pursuant to the Second Repurchase Program, we may acquire up to $10 million of our outstanding shares of common

stock from time to time in open-market transactions, privately negotiated block transactions or other means in accordance with applicable

securities laws.

For more information on the Second Repurchase Program, see “Note 13 – Treasury Stock.”

The increase in cash is attributable to the settlement

of the note receivable of $5 million, proceeds for the exercise of warrants and issuance of preferred stock, net of our investment in

QCLS, the repurchase of our common stock and our operating expenses.

Other Liquidity Matters

We have no other off-balance sheet arrangements

that could have a material current effect or that are reasonably likely to have a material adverse effect on our financial condition,

changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

To meet our short and long-term liquidity needs,

we expect to use existing cash balances and a variety of other means.

We have no other off-balance sheet arrangements that

could have a material current effect or that are reasonably likely to have a material adverse effect on our financial condition, changes

in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

To meet our short and long-term liquidity needs, we

expect to use existing cash balances and a variety of other means.

Other sources of liquidity could include additional potential issuances

16 unchanged sentences

Our total operating expenses during the year ended

April 30, 2025 were $4,377,862, representing a decrease of $4,142,146 compared to the year ended April 30, 2024.

The decrease is mainly

attributable to decreases in compensation expenses, director fees, impairment of asset, legal and professional and general and administrative

expenses, net of an increase in R&D.

April 30, 2026 were $6,853,713, representing an increase of $2,475,851 compared to the year ended April 30, 2025.

The increase is mainly

attributable to increases in intangible asset impairment, compensation expenses, director fees, legal and professional and general and

administrative expenses, net of a decrease in R&D.

Research and development expenses

R&D expense was $391,301 for the year ended

April 30, 2025, as compared to $407,431 for the year ended April 30, 2024, an increase of $30,985.

The increase in cost is primarily due

to entering into an agreement with consultants to conduct additional research into the treatment of pancreatic cancer.

April 30, 2026, as compared to $438,416 for the year ended April 30, 2025, a decrease of $47,115.

The decrease in cost is primarily due

to terminating an agreement with consultants to conduct additional research into the treatment of pancreatic cancer.

General and administrative expenses

6 unchanged sentences

These expenses were $4,912,985 and $3,939,446, respectively, for the years ended April 30, 2026 and 2025,

a decrease of $2,173,131, or 36%.

Compensation expenses decreased by $37,210 to a reduction in accrued vacation.

Director fees decreased

by $585,271 due to a reduction in equity compensation and payments made to directors.

Investor relations decreased by $198,364 due to

having two stockholder meetings in 2024 and one meeting in 2025.

Legal and professional fees decreased by $300,266 primarily due to a

reduction in legal fees relating to non-recurring legal issues.

Warrant issuance costs decrease of $913,640 incurred in 2024 were non-recurring

Impairment asset impairment

an increase of $973,539, or 25%.

Compensation expenses increased by $360,436 due to an increase in RSUs net of reduction in stock options.

Director fees increased by $298,112 due to an increase in RSUs granted, net of a reduction in stock options made to directors.

relations increased by $136,181 due to having two stockholder meetings in 2026 and one meeting in 2025.

Legal and professional fees increased

by $159,717 primarily due to an increase in legal fees relating to non-recurring legal issues.

Impairment asset expense

For the year ended April 30, 2026, we impaired

a license in the amount of $2,000,000.

an intangible asset in the amount of $1,549,427.

There was no impairment for the year ended April 30, 2025.

Other Income (Expenses), Net

Other income, net for the year ended April 30,

2025, was $35,033,912, as compared to other income, net of $8,853,771 in the year ended April 30, 2024.

Other income, net for the year

ended April 30, 2025 is attributable to interest income of $1,415,561, changes in fair values of warrant liability of $10,446,000, derivative

liability of $2,184,000, convertible note receivable of $941,000, preferred stock investment – TNF of $5,063,950, and gain on related

party investment – TNF of $21,395,734 and unrealized gain on the fair value of marketable securities of $66,316, less decreases

in the fair value of Femasys warrant asset of $2,091,000, TNF warrant asset of $2,367,684, settlement of legal complaint of $2,019,000

and other expenses of $965.

Other income, net for the year ended April 30, 2024 of $8,853,771 is attributable to interest income of $3,398,819,

changes in fair values of warrant liability of $3,343,000, derivative liability of $586,000, convertible note receivable of $1,089,000

and warrant asset of $1,818,000, less loss on write-off of long-term asset of $1,572,193 net of other income of $191,145.

is attributable to recovery of accrued expenses of $195,000 less income taxes and foreign exchange loss.

For the years ended April 30,

2025 and 2024, we recorded an asset loss of $0 and $1,572,193, respectively, related to the Company’s investment in SG Austria,

reducing the carrying value of such investment to zero.

Other income (expense), net for the year ended

April 30, 2026, was $(12,570,941), as compared to other income, net of $35,033,912 in the year ended April 30, 2025.

Other income (expense),

net for the year ended April 30, 2026 is attributable to interest and dividend income of $1,114,033, change in fair value of derivative

liability of $1,117,000, convertible note receivable of $1,304,000, and gain on related party investment – QCLS of $2,089,000, gain

on legal settlement re-fair value of warrants of $106,000 and less unrealized loss on the fair value of marketable securities of $412,306,

less decreases in the fair value of the Femasys warrant asset of $2,581,000, changes in fair value of warrant liability of $4,746,135,

preferred stock investment – QCLS of $7,732,000, QCLS warrant asset of $1,379,000, issuance costs on Series C Preferred Stock and

Series C Preferred Warrants $1,234,553, loss on issuance of Series C Preferred Stock of $215,000 and other expenses of $980.

Other income,

net for the year ended April 30, 2025 is attributable to interest income of $1,415,561, changes in fair values of warrant liability of

$10,446,000, derivative liability of $2,184,000, convertible note receivable of $941,000, preferred stock investment – QCLS of $5,063,950,

and gain on related party investment – QCLS of $21,395,734 and unrealized gain on the fair value of marketable securities of $66,316,

less decreases in the fair value of the Femasys warrant asset of $2,091,000, QCLS warrant asset of $2,367,684, settlement of legal complaint

of $2,019,000 and other expenses of $965.

Discussion of Operating, Investing and Financing

The following table presents a summary of our

sources and uses of cash for the years ended April 30, 2025 and 2024.

sources and uses of cash and cash equivalents for the years ended April 30, 2026 and 2025.

Net cash used in operating activities:

1 unchanged sentence

$ (2,978,296 )

Net cash used in investing activities:

$ (7,000,000 )

$ (5,000,000 )

Net cash used in financing activities:

Net cash provided by (used in) investing activities:

$ (7,000,000 )

Net cash provided by (used in) financing activities:

$ (25,029,151 )

Effect of currency rate exchange

Decrease in cash

$ (35,007,805 )

Increase (decrease) in cash and cash equivalents

$ (35,007,805 )

1 unchanged sentence

The cash used in operating activities for the

year ended April 30, 2025 is a result of our net income of $30,656,050, offset by non-cash transactions, change in fair value of

warrant asset in Femasys of $2,091,000 and legal settlement of $1,550,000, stock based compensation of $478,637, legal settlement

warrant liability of $469,000, change in fair value of TNF warrants of $2,367,684, offset by the gain on related party investment of

$(21,395,734) the changes in fair value of warrant liability of $(10,446,000), investment – TNF of $(5,063,950), derivative

liability of $(2,184,000), convertible note receivable of $(941,000), change in unrealized gain of marketable securities of

$(66,316), non-cash interest income of $(300,000), and changes to prepaid expenses, accounts payable, accrued expenses, and accrued

dividends totaling $(193,667).

year ended April 30, 2026 is a result of our net loss of $19,424,654, offset by non-cash transactions, change in the fair value of warrant

asset in Femasys of $2,581,000, change in stock-based compensation of $236,056, change in RSU compensation of $892,500, the changes in

fair value of warrant liability of $4,746,135, investment – QCLS of $7,732,000, change in fair value of QCLS warrants of $1,379,000,

change in unrealized loss of marketable securities of $412,306, loss on issuance of Series C Preferred Stock of $215,000, issuance costs

of Series C Preferred Stock and Series C Preferred Warrants of $1,234,553, impairment of intangible asset $1,549,427, offset by the gain

on related party investment of $2,089,000, change in derivative liability of $1,117,000, convertible note receivable of $1,304,000, gain

on re-fair value of warrants of $106,000, non-cash interest income of $162,500, and changes to prepaid expenses, accounts payable, accrued

expenses, and accrued dividends totaling $1,927,737.

The cash used in operating activities for the

year ended April 30, 2024 is a result of our net income of $333,763, convertible note receivable of $(1,089,000), changes in fair value

of warrant liability of $(3,343,000), derivative liability of $(586,000), warrant asset – Femasys of $(1,818,000), other non-cash

adjustments of $(195,000) offset by stock based compensation of $674,693, asset impairment of $2,000,000, loss on long term asset of $1,572,193,

and changes to prepaid expenses, accounts payable and accrued expenses of $298,894.

year ended April 30, 2025 is a result of our net income of $30,656,050, offset by non-cash transactions, change in the fair value of the

warrant asset in Femasys of $2,091,000 and legal settlement of $1,550,000, stock based compensation of $478,637, legal settlement warrant

liability of $469,000, change in fair value of QCLS warrants of $2,367,684, offset by the gain on related party investment of $21,395,734

the changes in fair value of warrant liability of $10,446,000, investment – QCLS of $5,063,950, derivative liability of $2,184,000,

convertible note receivable of $941,000, change in unrealized gain of marketable securities of $66,316, non-cash interest income of $300,000,

and changes to prepaid expenses, accounts payable, accrued expenses, and accrued dividends totaling $193,667.

Investing Activities:

The cash used in investing activities for the

year ended April 30, 2025 is mainly attributable to our entry into the TNF Purchase Agreement with a public company operating in the medical

industry, Pursuant to the TNF Purchase Agreement, we purchased (i) 7,000 shares of TNF’s Series G Convertible Preferred Stock (the

“Preferred Shares” or “Series G Preferred Stock”), representing approximately 33% of TNF’s issued and outstanding

share capital on an as-converted basis (and approximately 78% of all shares of Series G Preferred Stock outstanding), at a price of $1.816

per Preferred Share, which are convertible into 3,854,626 shares of Common Stock (as defined below);

(ii) warrants to purchase up to 3,854,626

shares of TNF’s Common Stock with a five-year term;

and (iii) warrants to purchase up to 3,854,626 shares of TNF’s Common

Stock with a 18-month, for an aggregate purchase price of $7,000,000.

The cash provided by investing activities for

the year ended April 30, 2026 is mainly attributable to the settlement of our note receivable with Femasys in the amount of $5 million,

net of our entry into the QCLS Purchase Agreement in the amount of $3 million, with a public company operating in the technology industry,

Pursuant to the QCLS Purchase Agreement, we purchased (i) 3,000 shares of QCLS’s Series H Convertible Preferred Stock (the “Preferred

Shares” or “Series H Preferred Stock”), which are convertible into 889,864 shares of Common Stock (as defined below);

(ii) warrants to purchase up to 889,864 shares of QCLS Common Shares with a one-year term.

The cash used in investing activities for the

year ended April 30, 2024 is mainly attributable to our entry into a Securities Purchase Agreement (the “Femasys Purchase Agreement”)

with Femasys Inc.

(“Femasys”), pursuant to which we purchased from Femasys for a sum of $5,000,000, (i) senior unsecured convertible

notes (the “Femasys Notes”) in an aggregate principal amount of $5,000,000, convertible into shares of Femasys common stock,

par value $0.001 per share (the “Femasys Shares”) at a conversion price of $1.18 per share, (ii) Series A Warrants (the “Series

A Warrants”) to purchase up to an aggregate of 4,237,288 Femasys Shares at an exercise price of $1.18 per share, and (iii) Series

B Warrants (the “Series B Warrants”, together with the Series A Warrants, the “Femasys Warrants,” and, together

with the Notes, the “Femasys Securities”) to purchase up to an aggregate of 4,237,288 Femasys Shares at an exercise price

of $1.475 per share.

The Series B Warrants expired on November 21, 2024.

year ended April 30, 2025 is attributable to our entry into the QCLS Purchase Agreement with a public company operating in the medical

industry, Pursuant to the QCLS Purchase Agreement, we purchased (i) 7,000 shares of QCLS’s Series G Convertible Preferred Stock

(the “Preferred Shares” or “Series G Preferred Stock”), at a price of $1.816 per Preferred Share, which are convertible

into 3,854,626 shares of Common Stock (as defined below);

(ii) warrants to purchase up to 3,854,626 shares of QCLS Common Shares with

a five-year term;

and (iii) warrants to purchase up to 3,854,626 shares of QCLS Common Shares with a 18-month, for an aggregate purchase

price of $7,000,000.

Financing Activities:

The cash used in financing activities for the

year ended April 30, 2025 is mainly attributable to the repurchase of common stock of approximately $2,542,000 and redemption of preferred

stock of approximately $22,487,000.The cash used in financing activities for the year ended April 30, 2024 was mainly attributable to

the Repurchase Programs of approximately $28,198,000, redemption of preferred stock of approximately $16,161,000, offset by the cash provided

by proceeds from the issuance of preferred stock of approximately $33,650,000, net of transaction costs.

The cash provided by financing activities for

the year ended April 30, 2026 is mainly attributable to the net proceeds from the issuance of Series C Preferred Stock of $6,182,447,

net proceeds from the exercise of Series B Warrants of $1,046,760, net of repurchase of common stock of $401,625 and Series C Preferred

Stock dividends of $246,005.

The cash used in financing activities for the year ended April 30, 2025 is mainly attributable to the repurchase

of common stock of approximately $2,542,000 and redemption of preferred stock of approximately $22,487,000.

Critical Accounting Estimates

18 unchanged sentences

and related disclosures with our Board.

During the year ended April 30, 2026, a change

in estimate was recorded for the QCLS Series G Preferred Stock expected term to settlement from five-years to one-year.

During the three

months ended April 30, 2026, new information became available relating to the estimate of the expected holding period.

This change in

estimate was accounted for prospectively beginning in the fourth quarter of the fiscal year.

The change in accounting estimate resulted

in a decrease in the fair value of the QCLS Series G Preferred Stock of $1,887,000.

The resulting change in accounting estimate negatively

impacted other income (expense), net income (loss) and net income (loss) attributable to common stockholders in the amount of $1,887,000.

The impact on basic and diluted earnings per share was a reduction of $0.23 per share, from a loss per share of $2.54 to a loss per share

of $2.77, with a corresponding net loss attributable to common stockholders of $21,319,372 and $23,206,372, respectively.

Fair Value of Financial Instruments

Fair value measurements are based upon certain

market assumptions and pertinent information available as of and during the year ended April 30, 2025.

The fair value of the bifurcated

embedded derivative related to the convertible preferred stock was estimated using a Monte Carlo simulation model, which uses as inputs

the fair value of our common stock and estimates for the equity volatility and traded volume volatility of our common stock, the time

to maturity of the convertible preferred stock, the risk-free interest rate for a period that approximates the time to maturity, dividend

rate, a penalty dividend rate, and our probability of default.

The fair value of the warrant liability was estimated using the Black Scholes

Model which uses as inputs the following weighted average assumptions:

Fair value measurements are based upon certain market

assumptions and pertinent information available as of and during the year ended April 30, 2026.

The fair value of the bifurcated embedded

derivative related to the convertible preferred stock was estimated using a Monte Carlo simulation model, which uses as inputs the fair

value of our common stock and estimates for the equity volatility and traded volume volatility of our common stock, the time to maturity

of the convertible preferred stock, the risk-free interest rate for a period that approximates the time to maturity, dividend rate, a

penalty dividend rate, and our probability of default.

The fair value of the warrant liability was estimated using the Black Scholes Model

which uses as inputs the following weighted average assumptions:

dividend yield, expected term in years;

equity volatility;

and risk-free interest rate.

In addition, we elect to account for its convertible

note receivable, which meets the required criteria, at fair value at inception and at each subsequent reporting date.

Subsequent changes

in fair value, including interest, are recorded as a component of non-operating income (loss) in the consolidated statements of operations.

We estimate the fair value of the convertible note receivable using the income approach, which uses as inputs the fair value of debtor’s

common stock and estimates for the equity volatility and volume volatility of debtor’s common stock, the time to expiration of the

convertible note, the discount rate, the stated interest rate compared to the current market rate, the risk-free interest rate for a period

that approximates the time to expiration, and probability of default.

Therefore, the estimate of expected future volatility is based on

the actual volatility of debtor’s common stock and historical volatility of debtor’s common stock utilizing a lookback period

consistent with the time to expiration.

and risk-free

interest rate.

We elect to account for its convertible note receivable,

which meets the required criteria, at fair value at inception and at each subsequent reporting date.

Subsequent changes in fair value,

including interest, are recorded as a component of non-operating income (loss) in the consolidated statements of operations.

the fair value of the convertible note receivable using the income approach, which uses as inputs the fair value of debtor’s common

stock and estimates for the equity volatility and volume volatility of debtor’s common stock, the time to expiration of the convertible

note, the discount rate, the stated interest rate compared to the current market rate, the risk-free interest rate for a period that approximates

the time to expiration, and probability of default.

Therefore, the estimate of expected future volatility is based on the actual volatility

of debtor’s common stock and historical volatility of debtor’s common stock utilizing a lookback period consistent with the

time to expiration.

The time to expiration is based on the contractual maturity date.

The risk-free interest rate

is determined by reference to the U.S.

Treasury yield curve in effect at the time of measurement for time periods approximately equal

to the time to expiration.

The probability of default is estimated using the S&P Global default rate for companies with a similar

credit rating to debtors.

The fair value in our warrant asset investment is estimated using a Monte Carlo simulation model, which uses

as inputs the fair value of the underlying common stock, and estimates for the equity volatility and traded volume volatility of the investee’s

common stock, the risk-free interest rate for a period that approximates the expected life of the warrants, and the expected life of the

The risk-free interest rate is determined by reference

Treasury yield curve in effect at the time of measurement for time periods approximately equal to the time to expiration.

The probability of default is estimated using the S&P Global default rate for companies with a similar credit rating to debtors.

fair value in our warrant asset investment is estimated using a Monte Carlo simulation model, which uses as inputs the fair value of the

underlying common stock, and estimates for the equity volatility and traded volume volatility of the investee’s common stock, the

risk-free interest rate for a period that approximates the expected life of the warrants, and the expected life of the warrants.

The fair value of the convertible note receivable

11 unchanged sentences

using the S&P Global default rate for companies with a similar credit rating to debtor’s

Fair Value of Long-Lived Assets

We determined that the diabetes licensed asset

technology would likely not prove to be a viable technique for the production of insulin producing cells and the treatment of diabetes.

We believe that a buyer of this technology would ascribe a de minimis value to this asset.

Therefore, we determined that there should

be a full impairment of the $2 million carrying value.

We determined that research in the treatment of diabetes would no longer be pursued

until the Cell-in-a-Box® use in pancreatic cancer treatment can be substantiated in a clinical trial and a viable cell line is acquired.

We determined that due to the SG Austria financial

position, negative book value and viability make for an inconclusive determination of a specific value range of our minority interest

in SG Austria and the value as of the present time is likely minimal.

Therefore, we determined that there should be a full impairment

of the approximately $1.6 million carrying value.

We recorded the issuance of Series C Preferred

Stock at its fair value and subsequent changes in fair value are recognized in earnings at each reporting period.

The investment date

fair value of the Series C Preferred Stock was estimated utilizing a probability weighted scenario model with the following inputs:

fair value of our Common Shares, estimated equity volatility, the time to maturity, the redemption premium, the liquidation premium, the

conversion price per share, a market interest rate, a risk-free rate, and dividend rate.

Our Series C Warrants were recorded at fair value

in accordance with ASC 815.

Subsequent changes in the fair value of the Warrants are recognized in earnings, at each reporting period.

The issuance date fair value of our Series C Warrants was determined utilizing the Black Scholes Merton Method.

In addition, we recorded the investment in QCLS

Series G Preferred Stock at its fair value and subsequent changes in fair value are recognized in earnings at each reporting period.

investment date fair value of the Series G Preferred Stock was estimated utilizing a Monte Carlo simulation with the following inputs:

the fair value of QCLS Common Stock, estimated equity volatility, the settlement date, the conversion price per share, a market interest

rate, a risk-free rate, probability of default and dividend rate.

The QCLS Series G Warrants were recorded at fair value in accordance

with ASC 815.

Subsequent changes in the fair value of the warrants are recognized in earnings, at each reporting period.

date fair value of the QCLS Series G Warrants was determined utilizing the Black Scholes Merton Method.

Also, we recorded the investment in QCLS Series

H Preferred Stock at its fair value and subsequent changes in the fair value are recognized in earnings at each reporting period.

initial fair value of the Series H Preferred Stock was estimated utilizing a probability-weighted scenario model, with the following inputs:

the fair value of QCLS Common Shares, estimated equity volatility, the time to maturity, the redemption premium, the liquidation premium,

the conversion price per share, a market interest rate, a risk-free rate, and dividend rate.

The QCLS Series H Warrants were determined

to meet the definition of a derivative and were required to be recorded at fair value in accordance with ASC 815.

Subsequent changes in

the fair value of the QCLS Series H Warrants are recognized in earnings, at each reporting date.

The issuance date fair value of the QCLS

Series H Warrants was determined utilizing the Black Scholes Merton Method.

New Accounting Pronouncements Effective in Future Periods

In August 2023, the FASB issued ASU 2023-05 –

Business Combinations – Joint Venture Formations (Subtopic 805-60), which requires public entities that qualify as a joint venture

or corporate joint venture to establish a new basis of accounting upon formation.

The guidance is effective for our annual periods beginning

May 1, 2025, and early adoption is permitted.

We are evaluating the impact of adoption of this standard on its financial statements and

disclosures but does not expect it to have a material effect on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09

- Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, which requires public entities to provide greater disaggregation within

their annual rate reconciliation, including new requirements to present reconciling items on a gross basis in specified categories, disclose

both percentages and dollar amounts, and disaggregate individual reconciling items by jurisdiction and nature when the effect of the items

meet a quantitative threshold.

The guidance also requires disaggregating the annual disclosure of income taxes paid, net of refunds received,

by federal (national), state, and foreign taxes, with separate presentation of individual jurisdictions that meet a quantitative threshold.

The guidance is effective for our annual periods beginning May 1, 2025 on a prospective basis, with a retrospective option, and early

adoption is permitted.

We are evaluating the impact of adoption of this standard on its financial statements and disclosures but does

not expect it to have a material effect on our consolidated financial statements.

In November 2024, the FASB issued ASU No.

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applied prospectively with the option of retrospective application.

We are currently evaluating the impact on the consolidated financial

statements and related disclosures.

The Company is currently evaluating the impact on the consolidated

financial statements and related disclosures.

In December 2025, the FASB issued ASU 2025-11

– Interim Reporting (Topic 270):

Narrow-Scope Improvements to improve the guidance in Topic 270, Interim Reporting, by improving

the navigability of the required interim disclosures and clarifying when that guidance is applicable.

The amendments also provide additional

guidance on what disclosures should be provided in interim reporting periods.

The guidance is effective for our interim periods within

annual reporting periods beginning after December 15, 2027.

We are evaluating the impact of adoption of this standard on its financial

statements and disclosures.

QUANTITATIVE AND QUALITATIVE DISCLOSURES

ABOUT MARKET RISK

We are a smaller reporting company and are not

required to include information called for by this Item 7A.

We are a smaller reporting company and are not required

to include information called for by this Item 7A.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis