What changed in this filing

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Item 9A. Controls and Procedures

2025-03-31 compared with 2024-04-02 · 1786 added, 1486 removed, 763 unchanged (81% of the section changed)

15 unchanged sentences

All internal control systems,

no matter how well designed, have inherent limitations and can provide only reasonable assurance that the objectives of the internal

control system are met.

Management assessed

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

In making this assessment, management used

the framework set forth in the report entitled Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations

no matter how well designed, have inherent limitations and can provide only reasonable assurance that the objectives of the internal control

system are met.

Management assessed the

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

In making this assessment, management used the

framework set forth in the report entitled Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations

of the Treadway Commission, or COSO.

1 unchanged sentence

including (i) the control environment, (ii) risk assessment, (iii) control activities, (iv) information and communication, and (v) monitoring.

Based on this evaluation,

our Chief Executive Officer and our Chief Financial Officer concluded that the Company’s internal control over financial reporting

as of December 31, 2023 was effective.

This Annual Report does not include an attestation

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

Pursuant to Item 308(b)

of Regulation S-K, management’s report is not subject to attestation by our independent registered public accounting firm because

the Company is neither an “accelerated filer” nor a “large accelerated filer” as those terms are defined by the

Changes in Internal Controls over Financial

on this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that the Company’s internal control over

financial reporting as of December 31, 2024 was effective.

Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial

Pursuant to Item 308(b) of Regulation S-K, management’s report is not subject to attestation by our independent registered

public accounting firm because the Company is neither an “accelerated filer” nor a “large accelerated filer” as

those terms are defined by the SEC.

Changes in Internal Control over Financial

There were no changes in our internal control

5 unchanged sentences

operating, and evaluating the controls and procedures, and the inability to eliminate misconduct completely.

Accordingly, any system

of internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable,

not absolute assurances.

Accordingly, any system of

internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable, not

absolute assurances.

In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls

4 unchanged sentences

We have no information to disclose that was required

to be disclosed in a report on Form 8-K during the fourth quarter of fiscal year 2023 but was not reported other than as disclosed below.

The information relating to the Second Triton

Amendment in Item 5.

“ Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity

Securities – Recent Sales Of Unregistered Securities ” is incorporated by reference herein.

to be disclosed in a report on Form 8-K during the fourth quarter of fiscal year 2024 but was not reported.

None of our directors or “officers,”

as defined in Rule 16a-1(f) under the Exchange Act, adopted or terminated a Rule 10b5-1 trading plan or arrangement or a non-Rule 10b5-1

trading plan or arrangement, as defined in Item 408(c) of Regulation S-K, during the fiscal quarter ended December 31, 2024.

New Executive Employment and Consulting

On March 27, 2025, the Company entered into a

letter agreement between the Company and Arshia Sarkhani, the Company’s Chief Executive Officer and President, dated as of March

27, 2025 (the “New Arshia Sarkhani Agreement”).

Under the New Arshia Sarkhani Agreement, Mr.

Sarkhani will remain employed

by the Company for a term that will begin on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with

its terms or extended by mutual written agreement.

For the period beginning on the day following the date of the termination of the Company’s

previous letter agreement, dated as of April 21, 2022, between the Company and Mr.

Sarkhani (the “Prior Arshia Sarkhani Employment

Agreement”), and ending on April 1, 2027, the Company will pay Mr.

Sarkhani an annual salary of $240,000.

Pursuant to the New Arshia

Sarkhani Agreement, the Company will also pay Mr.

Sarkhani an immediate cash bonus of $25,000.

Sarkhani will also be eligible to receive

an annual cash bonus as determined by the Company’s board of directors or the Compensation Committee of the board (the “Compensation

Subject to the approval by the Company’s stockholders of an amendment to the Asset Entities Inc.

Incentive Plan (the “Plan”) to increase the number of shares of the Class B Common Stock available for grant under the Plan,

and further subject to the approval of the board or the Compensation Committee, Mr.

Sarkhani will be granted an award of shares of Class

B Common Stock under the Plan in an amount to be determined by the board or the Compensation Committee pursuant to a restricted stock

award agreement (the “Sarkhani Award Agreement”).

The shares will vest equally over two years on each anniversary of the Sarkhani

Award Agreement subject to Mr.

Sarkhani’s continuous service.

Upon a change of control of the Company, all of the shares will vest

The Sarkhani Award Agreement will also contain non-competition and non-solicitation provisions.

Under the New Arshia Sarkhani

Agreement, Mr.

Sarkhani will be eligible to participate in standard benefits plans offered to similarly-situated employees by the Company

from time to time, subject to plan terms and generally applicable Company policies.

The New Arshia Sarkhani Agreement also contains certain

confidentiality provisions.

The Company may terminate Mr.

Sarkhani for “cause” as defined in the New Arshia Sarkhani Agreement.

If the Company terminates Mr.

Sarkhani without cause, the Company will be required to pay Mr.

Sarkhani a separation fee of $240,000.

On March 27, 2025, the Company entered into a

letter agreement between the Company and Matthew Krueger, the Company’s Chief Financial Officer, Treasurer and Secretary, dated

as of March 27, 2025 (the “New Krueger Agreement”).

Under the New Krueger Agreement, Mr.

Krueger will remain employed by the

Company for a term that will begin on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its terms

or extended by mutual written agreement.

For the period beginning on the day following the date of the termination of the Company’s

previous letter agreement, dated April 21, 2022, between the Company and Mr.

Krueger (the “Prior Krueger Agreement”), and

ending on April 1, 2027, the Company will pay Mr.

Krueger an annual salary of $180,000.

Pursuant to the New Krueger Agreement, the Company

will also pay Mr.

Krueger an immediate cash bonus of $50,000.

Krueger will also be eligible to receive an annual cash bonus as determined

by the board or the Compensation Committee.

Subject to the approval by the Company’s stockholders of an amendment to the Plan

to increase the number of shares of Class B Common Stock available for grant under the Plan, and further subject to the approval of the

board or the Compensation Committee, Mr.

Krueger will be granted an award of shares of Class B Common Stock under the Plan in an amount

to be determined by the board or the Compensation Committee pursuant to a restricted stock award agreement (the “Krueger Award Agreement”).

The shares will vest equally over two years on each anniversary of the Krueger Award Agreement subject to Mr.

Krueger’s continuous

Upon a change of control of the Company, all of the shares will vest immediately.

The Krueger Award Agreement will also contain

non-competition and non-solicitation provisions.

Under the New Krueger Agreement, Mr.

Krueger will be eligible to participate in standard

benefits plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable

Company policies.

The New Krueger Agreement also contains certain confidentiality provisions.

The Company may terminate Mr.

“cause” as defined in the New Krueger Agreement.

If the Company terminates Mr.

Krueger without cause, the Company will be

required to pay Mr.

Krueger a separation fee of $180,000.

On March 27, 2025, the Company entered into a

letter agreement between the Company and Kyle Fairbanks, the Company’s Executive Vice-Chairman and Chief Marketing Officer, dated

as of March 27, 2025 (the “New Kyle Fairbanks Agreement”).

Under the New Kyle Fairbanks Agreement, Mr.

Fairbanks will remain

employed by the Company for a term that will begin on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance

with its terms or extended by mutual written agreement.

For the period beginning on the day following the date of the termination of the

Company’s previous letter agreement, dated April 21, 2022, between the Company and Mr.

Fairbanks (the “Prior Kyle Fairbanks

Agreement”), and ending on April 1, 2027, the Company will pay Mr.

Fairbanks an annual salary of $240,000.

Pursuant to the New Kyle

Fairbanks Agreement, the Company will also pay Mr.

Fairbanks a cash bonus of $10,000 on April 1, 2025.

Fairbanks will also be eligible

to receive an annual cash bonus as determined by the board or the Compensation Committee.

Subject to the approval by the Company’s

stockholders of an amendment to the Plan to increase the number of shares of Class B Common Stock available for grant under the Plan,

and further subject to the approval of the board or the Compensation Committee, Mr.

Fairbanks will be granted an award of shares of Class

B Common Stock under the Plan in an amount to be determined by the board or the Compensation Committee pursuant to a restricted stock

award agreement (the “Fairbanks Award Agreement”).

The shares will vest equally over two years on each anniversary of the

Fairbanks Award Agreement subject to Mr.

Fairbanks’s continuous service.

Upon a change of control of the Company, all of the shares

will vest immediately.

The Fairbanks Award Agreement will also contain non-competition and non-solicitation provisions.

Under the New

Kyle Fairbanks Agreement, Mr.

Fairbanks will be eligible to participate in standard benefits plans offered to similarly-situated employees

by the Company from time to time, subject to plan terms and generally applicable Company policies.

The New Kyle Fairbanks Agreement also

contains certain confidentiality provisions.

The Company may terminate Mr.

Fairbanks for “cause” as defined in the New Kyle

Fairbanks Agreement.

If the Company terminates Mr.

Fairbanks without cause, the Company will be required to pay Mr.

Fairbanks a separation

fee of $240,000.

On March 27, 2025, the Company entered into an

engagement letter between the Company and Michael Gaubert, the Company’s Executive Chairman, dated as of March 27, 2025 (the “New

Gaubert Agreement”).

Under the New Gaubert Agreement, Mr.

Gaubert will continue to provide services to the Company for a term that

will begin on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its terms or extended by mutual

written agreement.

For the period beginning on the day following the date of the termination of the Company’s previous engagement

letter, dated April 21, 2022, between the Company and Mr.

Gaubert (the “Prior Gaubert Agreement”), and ending on April 1,

2027, the Company will pay Mr.

Gaubert a monthly fee of $20,000.

Pursuant to the New Gaubert Agreement, the Company will also pay Mr.

Gaubert an immediate cash fee of $75,000.

Gaubert will be eligible to receive additional cash payments as determined by the Company.

Gaubert will also be reimbursed for all preapproved costs and expenses reasonably incurred in the performance of his services to the

Subject to the approval by the Company’s stockholders of an amendment to the Plan to increase the number of shares of Class

B Common Stock available for grant under the Plan, and further subject to the approval of the board or the Compensation Committee, Mr.

Gaubert will be granted an award of shares of Class B Common Stock under the Plan in an amount to be determined by the board or the Compensation

Committee pursuant to a restricted stock award agreement (the “Gaubert Award Agreement”).

The shares will vest equally over

two years on each anniversary of the Gaubert Award Agreement subject to Mr.

Gaubert’s continuous service.

The Gaubert Award Agreement

will also contain non-competition and non-solicitation provisions.

Upon a change of control of the Company, all of the shares will vest

Under the New Gaubert Agreement, Mr.

Gaubert will be eligible to participate in standard benefits plans offered to similarly-situated

employees by the Company from time to time, subject to plan terms and generally applicable Company policies.

The New Gaubert Agreement

also contains certain confidentiality provisions.

The New Gaubert Agreement may be terminated by either party upon 30 days’ advance

written notice.

However, if either party breaches a material obligation under the New Gaubert Agreement, and such breach continues for

a period of ten days after the other party notifies the breaching party, the New Gaubert Agreement may be terminated immediately by notice

to the breaching party.

In addition, if the Company commits such a breach, or the Company terminates Mr.

Gaubert in the absence of a material

breach by Mr.

Gaubert under the New Gaubert Agreement, then any shares granted will vest immediately, any shares due will be granted and

vest immediately, and the Company will be required to pay Mr.

Gaubert a separation fee of $240,000.

Each of the executive officers named above was required to sign an

Employee Confidential Information and Inventions Assignment Agreement or an Independent Contractor Confidential Information and Inventions

Assignment Agreement which prohibits unauthorized use or disclosure of the Company’s proprietary information, contains a general

assignment of rights to inventions and intellectual property rights, non-competition provisions that apply during the term of employment

or services, non-solicitation provisions that apply during the term of employment or services and for one year after the term of employment

or services, and non-disparagement provisions that apply during and after the term of employment or services.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.

4 unchanged sentences

directors and executive officers:

Chief Experience Officer

Michael Gaubert

3 unchanged sentences

Matthew Krueger

Chief Financial Officer,

Treasurer and Secretary

Chief Financial Officer, Treasurer and Secretary

Arman Sarkhani

1 unchanged sentence

Kyle Fairbanks

Chief Marketing Officer,

Executive Vice-Chairman and Director

Chief Marketing Officer, Executive Vice-Chairman and Director

Chief Technology Officer

Derek Dunlop has served as our Chief Experience Officer since September 2021.

From April 2020 to January 2022, Mr.

provided consulting services through his business Digital Punk LLC.

From June 2017 to April 2020, Mr.

Dunlop was an executive officer

and co-founder of games developer AuGames.

From November 2013 to May 2017, Mr.

Dunlop worked on software development at Projekt202 as

a project developer.

Dunlop has worked in the innovation, design, and consulting industry for over 20 years, designing, developing

and presenting ideas and solutions for global companies.

These solutions include the creation of new dynamic business models and new

strategic directions to a variety of companies and industries.

As a Practice Leader and Media, Retail and Digital Strategist at Dell

EMC (formerly EMC Corporation) from September 2009 to November 2013, Mr.

Dunlop managed teams that worked on the cutting edge of “cloud-enabled”

application development, big data analytics and next-generation employee portal platforms, with a focus on solution envisioning and customer

pre-sales together with DevOps, platform-as-a-service, real-time analytics, application modernization and portal platforms.

from September 2009 to November 2013, Mr.

Dunlop worked on strategic development for James Cameron’s Lightstorm Entertainment and

for digital visual effects company WETA Digital, founded by Peter Jackson.

As a Strategic Digital Media Consultant for EMC Consulting

Group Inc., from October 2006 to September 2009, Mr.

Dunlop worked with technical blueprints and corporate DNA infrastructure;

business plans and sales strategies for UK and global companies;

managed solutions, concepts, training, and go to market propositions

for sales teams;

managed and delivered white papers, press articles, and press releases;

and acted as a company spokesperson As Head

of Media and Technology Worldwide at Virgin Entertainment from June 1992 to October 2006, Mr.

Dunlop managed multimillion Euro stores

and projects across 132 retail stores in the UK and Ireland as well as more than 200 stores around the world.

Based on this experience,

Dunlop has an expert understanding of consumer-facing technology and media delivery platforms across multiple network applications

and what it takes to deliver a new commercial, technical and strategic direction for a company.

Dunlop received his Bachelor’s

degree in Electronic and Electrical Engineering from Robert Gordon University.

Michael Gaubert has served as our

Executive Chairman since January 2022 and as our General Counsel since September 2021.

Gaubert has been a licensed attorney for 28

David Reynolds

Gaubert has served as our Executive Chairman since January 2022 and has been a director of the Company since March 2022.

Gaubert has been a licensed attorney for 31 years.

Since July 2016, Mr.

Gaubert has been the President of Gaubert Law Group, PC, where he provides legal services to his clients.

Gaubert has been the President of Gaubert Law Group, PC, where

he provides legal services to his clients.

Prior to establishing Gaubert Law Group, PC, from March 2015 to July 2016, Mr.

Gaubert was a partner at the national law firm of Lewis

Brisbois Bisgaard & Smith, LLP, ranked in the top 20 largest law firms in the country.

a partner at the national law firm of Lewis Brisbois Bisgaard & Smith, LLP, ranked in the top 20 largest law firms in the country.

Since August 2017, Mr.

Gaubert has been a

manager of the rideshare company Get It Holdings, LLC.

From February 2015 to December 2017, Mr.

Gaubert was the chairman and chief executive

officer of Get Me, LLC, a rideshare/delivery software app operator, and he resumed the position of chairman in April 2018.

has litigation and trial experience working on complex cases in a variety of areas relating to management contracts, termination agreements,

loan agreements, real estate sale and purchase contracts, and various other agreements.

Gaubert has represented large real estate

companies, hotel owners and operators, including, publicly- and privately-held businesses, in litigation in multiple U.S.

Gaubert represents clients in complex commercial and business litigation, business and real estate, and other transactions.

areas of practice include general contract, business torts, real estate litigation and transactions, hotel and hospitality law, construction

contracts and litigation, personal services contracts, consulting agreements, bankruptcy litigation, intellectual property, e-commerce

and Internet-related issues, and certain aspects of entertainment law and related disputes.

Gaubert is admitted to practice law in

all of the Courts of the State of Texas, the United States District Court for the Northern District of Texas, the United States District

Court for the Eastern District of Texas, the United States Court of Appeals for the Third Circuit, and the United States Court of Appeals

for the Fifth Circuit.

Gaubert received his JD from Georgetown University Law Center and his Bachelor’s degree in History with

a minor in Business Administration and African American Studies from Southern Methodist University.

Gaubert has been a manager of the rideshare company Get It Holdings, LLC.

From February 2015 to December 2017,

Gaubert was the chairman and chief executive officer of Get Me, LLC, a rideshare/delivery software app operator, and he resumed the

position of chairman in April 2018.

Gaubert has litigation and trial experience working on complex cases in a variety of areas relating

to management contracts, termination agreements, loan agreements, real estate sale and purchase contracts, and various other agreements.

Gaubert has represented large real estate companies, hotel owners and operators, including publicly- and privately-held businesses,

in litigation in multiple U.S.

Gaubert represents clients in complex commercial and business litigation, business and real

estate, and other transactions.

Gaubert’s areas of practice include general contract, business torts, real estate litigation

and transactions, hotel and hospitality law, construction contracts and litigation, personal services contracts, consulting agreements,

bankruptcy litigation, intellectual property, e-commerce and Internet-related issues, and certain aspects of entertainment law and related

Gaubert is admitted to practice law in all of the Courts of the State of Texas, the United States District Court for the

Northern District of Texas, the United States District Court for the Eastern District of Texas, the United States Court of Appeals for

the Third Circuit, and the United States Court of Appeals for the Fifth Circuit.

Gaubert received his JD from Georgetown University

Law Center and his bachelor’s degree in History with a minor in Business Administration and African American Studies from Southern

Methodist University.

We believe that Mr.

Gaubert is qualified to serve on the board of directors due to his deep knowledge of the Company

and his professional, executive and board experience.

Arshia Sarkhani is a co-founder

of Asset Entities, and has served as our Chief Executive Officer and a director since September 2021 and President since March 2022.

Sarkhani was our Head of Monetization from August 2020, when we began our operations as a general partnership, until September 2021.

Since April 2020 and July 2020, Mr.

Sarkhani has also been sole owner and chief executive officer of Sarkhani Inc.

and Shiazon Inc.,

respectively.

of Asset Entities, has served as our Chief Executive Officer since September 2021 and as our President since March 2022, and has been

a director of the Company since March 2022.

Sarkhani was our Head of Monetization from August 2020, when we began our operations as

a general partnership, until September 2021.

From April 2020 and July 2020 to December 2021, Mr.

Sarkhani was the sole owner and chief

executive officer of Sarkhani Inc.

and Shiazon Inc., respectively.

Before co-founding Asset Entities, Mr.

Sarkhani actively invested and developed a social media following which he and his

co-founders utilized when starting Asset Entities.

From May 2019 to September 2020, Mr.

Sarkhani was a legal intern at The RDM Legal

Sarkhani actively invested and

developed a social media following which he and his co-founders utilized when starting Asset Entities.

From May 2019 to September 2020,

Sarkhani was a legal intern at The RDM Legal Group.

From September 2015 to May 2018, Mr.

Sarkhani attended the University of California, Merced, and subsequently, from September

2018 to May 2019, Grossmont Community College.

Sarkhani attended the University of California,

Merced, and subsequently, from September 2018 to May 2019, Grossmont Community College.

From September 2019 to May 2021, Mr.

Sarkhani attended San Diego State University where

he received his Bachelor’s degree in Humanities.

attended San Diego State University where he received his Bachelor’s degree in Humanities.

We believe that Mr.

Sarkhani is qualified to serve on our board of directors as

a co-founder with deep knowledge of Asset Entities.

Sarkhani is qualified

to serve on the board of directors as a co-founder with deep knowledge of Asset Entities.

Matthew Krueger has served as our

Chief Financial Officer since September 2021 and became Secretary and Treasurer in March 2022.

Since December 2018, Mr.

Krueger has been

the manager and chief executive officer of his consulting company Xcelerated Consulting, LLC where he provides business and management

services to clients in the technology, oil and gas, and real estate industry.

Chief Financial Officer since September 2021 and has been the Company’s Secretary and Treasurer in March 2022.

Since December 2018,

Krueger has been the manager and chief executive officer of consulting company Xcelerated Consulting, LLC where he provides business

and management services to clients in the technology, oil and gas, and real estate industry.

From March 2015 to December 2018, Mr.

Krueger was the director

of finance at Get Me, LLC.

From 2010 to 2015, he had roles as the director of finance, controller, and assistant controller at Technology

Resource Center of America, LLC.

Krueger received his Bachelor’s degree in Business Administration, with a minor in Accounting,

summa cum laude, from Finlandia University.

was the director of finance at Get Me, LLC.

From 2010 to 2015, he had roles as the director of finance, controller, and assistant controller

at Technology Resource Center of America, LLC.

Krueger received his bachelor’s degree in Business Administration, with a minor

in Accounting, summa cum laude, from Finlandia University.

Krueger holds a Texas CPA license.

Arman Sarkhani is a co-founder

of Asset Entities, and has served as our Chief Operating Officer since January 2022.

Arman Sarkhani is a co-founder of

Asset Entities and has served as the Chief Operating Officer since January 2022.

Before co-founding Asset Entities, Mr.

actively invested and developed a social media following which he and his co-founders utilized when starting Asset Entities.

Sarkhani actively

invested and developed a social media following which he and his co-founders utilized when starting Asset Entities.

From October 2019

to November 2020, Mr.

Sarkhani was a tutor with AVID, a nonprofit educational service, at Mount Carmel High School.

2018 to May 2021, Mr.

From August 2018 to

May 2021, Mr.

Sarkhani attended Miramar Community College.

Sarkhani has been attending University of California – San

Diego since September 2021, and expects to earn a Bachelor’s degree in Marketing and Marketing Management in May 2024.

Kyle Fairbanks is a co-founder

of Asset Entities, has served as our Executive Vice-Chairman since January 2022 and has served as our Chief Marketing Officer since November

Fairbanks was our Executive Chairman from August 2020, when we began our operations as a general partnership, until January

Sarkhani has attended University of California – San Diego since

September 2021, and expects to earn a bachelor’s degree in Psychology, Marketing, and Management in May 2025.

Kyle Fairbanks is a co-founder of

Asset Entities, has served as our Executive Vice-Chairman since January 2022, as our Chief Marketing Officer since November 2023, and

has been a director of the Company since March 2022.

Fairbanks was our Executive Chairman from August 2020, when we began our operations

as a general partnership, until January 2022.

Before co-founding Asset Entities, Mr.

Fairbanks actively invested and developed a social media following which he and his co-founders

utilized when starting Asset Entities.

Fairbanks actively invested and developed a social

media following which he and his co-founders utilized when starting Asset Entities.

From December 2019 to December 2020, Mr.

Fairbanks worked as a certified personal trainer with

Associated Students, a student-led nonprofit auxiliary of California State University, Chico.

worked as a certified personal trainer with Associated Students, a student-led nonprofit auxiliary of California State University, Chico.

From September 2017 to May 2018, Mr.

worked as a part-time instructional aide at the Humboldt County Office of Education Juvenile Hall Court.

From September to October 2019,

Fairbanks worked as a part-time instructional aide at the Humboldt County Office of Education Juvenile

From September to October 2019, Mr.

Fairbanks worked as a dining hall student-employee at California State University, Chico.

Fairbanks received his Bachelor’s

degree in Business Administration and Management from California State University, Chico in May 2020.

Fairbanks received his Bachelor’s degree in Business Administration and Management from California State University, Chico in

We believe that Mr.

qualified to serve on our board of directors as a co-founder with deep knowledge of Asset Entities.

Fairbanks is qualified to serve on the board of directors as a co-founder with deep knowledge of Asset Entities.

Jason Lee has served as our Chief

1 unchanged sentence

In July 2020, Mr.

Lee founded Ternary, a Discord community business management service, and served

as its Chief Executive Officer until November 2023 when its business and assets were acquired by the Company.

Lee founded Ternary Inc., a Discord community business management service, and

served as its Chief Executive Officer until November 2023 when its business and assets were acquired by the Company.

In August 2019, Mr.

co-founded OptionsSwing, an educational Discord options trading service, and served as its Chief Executive Officer until November 2023

Lee co-founded OptionsSwing Inc., an educational Discord options trading service, and served as its Chief Executive Officer until November

2023 when its business and assets were also acquired by the Company.

2 unchanged sentences

From April 2014 to November 2020, Mr.

Lee worked for Salesforce

CRM), where from February 2017 he was a Lead Solution Engineer after previously working as an Associate Solution Engineer,

Solution Engineer, and Senior Solution Engineer from April 2014 to February 2017.

Lee holds several Salesforce certifications, which

underscore his expertise in customer relationship management (CRM) technologies.

Lee worked for Salesforce Inc.

CRM), where from February 2017 he was a Lead Solution Engineer after consecutive positions as an Associate Solution Engineer, Solution

Engineer, and Senior Solution Engineer from April 2014 to February 2017.

Lee holds several Salesforce certifications, which underscore

his expertise in customer relationship management (CRM) technologies.

Lee received his bachelor’s degree in U.S.

History from Syracuse University.

Burton became a member

of our board of directors in February 2023.

Burton is also the chairman of our compensation committee and a member of our audit committee

and nominating and corporate governance committee.

Syracuse University.

Burton has been a director

of the Company since February 2023.

Burton is licensed to practice law in Texas.

Since 2009, Mr.

Burton has served

as general counsel and executive vice president for Landmark Management Group, LLC.

As part of his duties, he manages the corporate and

regulatory affairs of companies in the financial services industry, in addition to managing the human resources department and acting

as the company’s spokesperson.

Burton has served as general counsel

and executive vice president for Landmark Management Group, LLC.

As part of his duties at Landmark Management Group, he manages the corporate

and regulatory affairs of companies in the financial services industry, in addition to managing the human resources department and acting

as company spokesperson.

From 1996 to 2008, Mr.

Burton was general counsel and executive vice president for Marketing Investors

Corporation, Inc.

where he managed the corporate and litigation affairs of businesses operating in the real estate, apparel, direct to

consumer sales and restaurant industries.

Burton has been a director on several boards over the years, including CreditAssociates,

LLC, CID Resources, Inc.

Burton was general counsel and executive vice president for Marketing Investors Corporation,

where he managed the corporate and litigation affairs of businesses operating in the real estate, apparel, direct to consumer sales

and restaurant industries.

Burton has been a director on several boards over the years, including CreditAssociates, LLC, CID Resources,

and BayLab USA, LLC.

Burton received his JD from the Albany Law School of Union University and his Bachelor’s

degree in Finance and Economics from State University of New York at Albany.

Burton received his JD from the Albany Law School of Union University and his bachelor’s degree in

Finance and Economics from State University of New York at Albany.

We believe that Mr.

Burton is qualified to serve on our

board of directors due to his extensive legal career and board of director experience.

Jack II became

a member of our board of directors in February 2023.

Jack is an attorney licensed to practice law in Florida.

Jack is also a

member of our compensation committee and nominating and corporate governance committee.

Burton is qualified to serve on the board of directors

due to his extensive legal career and board of directors experience.

Jack II has been a director

of the Company since February 2023.

Since 1998, Mr.

Jack has been an Allstate Insurance

Agent with offices in Boca Raton and Delray Beach, Florida.

Throughout this time, these offices have won numerous awards from Allstate,

including the Honor Ring for six years, Circle of Champions Award for three years, Inner Circle Elite Award for two years and the National

Conference Award for one year.

Jack served on the Advent Lutheran School Board from 2012 to 2016, and is currently serving on the

Advent Luther Church Executive Committee.

Jack received his JD from Georgetown University Law Center and his Bachelor’s degree

in Communication and Economics from the University of Miami.

Jack played Division 1 College football for the famed Miami Hurricanes

from 1985 to 1989 winning a national championship under the nationally known former coach, Jimmy Johnson, before attending law school

at Georgetown.

Jack has been an Allstate Insurance Agent with offices in Boca Raton and Delray Beach,

Throughout this time, these offices have won numerous awards from Allstate, including the Honor Ring for six years, Circle of

Champions Award for three years, Inner Circle Elite Award for two years and the National Conference Award for one year.

on the Advent Lutheran School Board of Boca Raton, Florida from 2012 to 2016 and served on the Advent Luther Church Executive Committee

of Boca Raton, Florida until February 2024.

Jack played Division 1 College football for the famed Miami Hurricanes from 1985 to 1989

winning a national championship under the nationally known former coach, Jimmy Johnson, before attending law school at Georgetown.

Jack received a JD from Georgetown University Law Center and his bachelor’s degree in Communication and Economics from the University

Jack was formerly licensed to practice law in Florida.

We believe that Mr.

Jack is qualified to serve on our board of directors due to his record of business team management

and successes.

McDonald became

a member of our board of directors in February 2023.

McDonald is also the chairman of our nominating and corporate governance committee

and a member of our audit committee.

Jack is qualified to serve on the board of directors

due to his record of business team management and successes.

been a director of the Company since February 2023.

McDonald is licensed to practice law in Texas.

Over the course of the four decades Mr.

has been practicing law, he has represented buyers and sellers of real property and lenders in a variety of transactions, including clients

who buy, sell and develop unimproved real property and who buy and sell improved property such as multifamily projects, retail projects

and office buildings.

Over the course of the four decades

McDonald has been practicing law, he has represented buyers and sellers of real property and lenders in a variety of transactions,

including clients who buy, sell and develop unimproved real property and who buy and sell improved property such as multifamily projects,

retail projects and office buildings.

McDonald has also been lender’s counsel for banks, savings and loans and private lenders.

2007, and again from 2019 to present, Mr.

From 2001 to 2007, and again from 2019 to 2022, Mr.

McDonald has served on the Planning and Zoning Commission for the City of DeSoto,

received his JD from the University of Texas and his Bachelor’s degree in Political Science and Mathematics from Southern Methodist

McDonald received his JD from the University of Texas and his bachelor’s degree in Political Science and Mathematics

from Southern Methodist University.

We believe that Mr.

McDonald is qualified to serve on our board of directors due to his extensive legal career and commission

Brian Regli became a

member of our board of directors in February 2023.

Regli is also the chairman of our audit committee and a member of our compensation

McDonald is qualified to serve on the board of directors due to his extensive

legal career and commission experience.

David Reynolds has been

a director of the Company since May 2024.

Since 2011, Mr.

Regli has been the chief executive officer of Revere Suburban Realty.

Regli has also been the chief financial

officer of DVNC LLC since 2020.

From 2006 to 2012, Mr.

Regli was the chief executive officer of Drakontas LLC, from which he transitioned

to being the Director of Commerce for Montgomery County, Pennsylvania from 2012 to 2014 during which time he was also the Executive Director

for Montgomery County Industrial Development Authority.

Regli has been on many boards and committees over the years, including being

a member of the Board of Trustees for Gwynedd Mercy University since 2020 and a director on the Cheltenham Township Community Development

Corporation since 2017.

Regli received his Ph.D.

and Master’s degree in Comparative Politics and International Economic Development

from The Fletcher School of Law and Diplomacy, Tufts University, and his Bachelor’s degree in Philosophy and Government from Georgetown

Reynolds has worked at MRO Corporation, a healthcare software company, initially

as Regional Director of Sales – West from September 2011 to August 2018, and in his current position as Senior Director of Sales

– Major Accounts since August 2018.

Prior to these positions, Mr.

Reynolds held various sales and business development positions

at other healthcare software companies including Superior Global Solutions, EDiX Corporation, and Webmedx (now Nuance Communications).

Reynolds is proficient with many customer relationship management (CRM) software tools including Salesforce, Saleslogix, Sage and

From March 2024 to August 2024, Mr.

Reynolds served as a member of the board of directors of Trinity Constructors, Inc., a commercial

construction company in Texas.

Reynolds attended University of Denver and Southern Methodist University where he studied Political

Science and English.

We believe that Mr.

Regli is qualified to serve on our board of directors due to his long record of executive and board experience.

Reynolds is qualified to serve on our board of directors due to his extensive sales, CRM software,

and cybersecurity experience as a healthcare software executive.

Our directors currently have terms which will

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Family Relationships

Arman Sarkhani, our Chief Operating Officer,

and Arshia Sarkhani, our Chief Executive Officer and President and a director, are brothers.

Michael Gaubert, our Executive Chairman,

and Brian Regli, a member of our board of directors, are cousins.

There are no other family relationships among any of our executive

officers or directors.

Arman Sarkhani, our Chief Operating Officer, and

Arshia Sarkhani, our Chief Executive Officer and President and a director, are brothers.

There are no other family relationships among

any of our executive officers or directors.

Involvement in Certain Legal Proceedings

1 unchanged sentence

below, none of our directors or executive officers has, during the past ten years:

● been convicted in a criminal proceeding

or been subject to a pending criminal proceeding (excluding traffic violations and other

minor offences);

● had any bankruptcy petition filed

by or against the business or property of the person, or of any partnership, corporation

or business association of which he was a general partner or executive officer, either at

the time of the bankruptcy filing or within two years prior to that time;

● been subject to any order, judgment,

or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction

or federal or state authority, permanently or temporarily enjoining, barring, suspending

or otherwise limiting, his involvement in any type of business, securities, futures, commodities,

investment, banking, savings and loan, or insurance activities, or to be associated with

persons engaged in any such activity;

● been found by a court of competent

jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission

to have violated a federal or state securities or commodities law, and the judgment has not

been reversed, suspended, or vacated;

● been the subject of, or a party

to, any federal or state judicial or administrative order, judgment, decree, or finding,

not subsequently reversed, suspended or vacated (not including any settlement of a civil

proceeding among private litigants), relating to an alleged violation of any federal or state

securities or commodities law or regulation, any law or regulation respecting financial institutions

or insurance companies including, but not limited to, a temporary or permanent injunction,

order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist

order, or removal or prohibition order, or any law or regulation prohibiting mail or wire

fraud or fraud in connection with any business entity;

● been the subject of, or a party

to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory

organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C.

78c(a)(26))),

any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C.

1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary

authority over its members or persons associated with a member.

● been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic

violations and other minor offences);

● had any bankruptcy petition filed by or against the business or property of the person, or of any partnership,

corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing

or within two years prior to that time;

● been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any

court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise

limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance

activities, or to be associated with persons engaged in any such activity;

● been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures

Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended,

● been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree,

or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants),

relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting

financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement

or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation

prohibiting mail or wire fraud or fraud in connection with any business entity;

● been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated,

of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C.

78c(a)(26))), any registered entity

(as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C.

1(a)(29))), or any equivalent exchange, association, entity or

organization that has disciplinary authority over its members or persons associated with a member.

Committees of the Board of Directors

Our board established the Company’s Audit

Committee, Compensation Committee, and Nominating and Corporate Governance Committee, each with its own charter approved by the board.

Each committee’s charter is also available on our website at https://www.assetentities.com/.

Our board established the Company’s Audit Committee (the “Audit Committee”), Compensation Committee, and Nominating

and Corporate Governance Committee (the “Nominating and Corporate Governance Committee”), each with its own charter approved

by the board.

Each committee’s charter is also available on our website at https://assetentities.gcs-web.com.

In addition, our board of directors may, from

1 unchanged sentence

For further related discussion, see Item 13.

Certain Relationships and Related Transactions, and Director Independence – Director Independence – Committees of

the Board of Directors ”.

Relationships and Related Transactions, and Director Independence – Director Independence – Committees of the Board of Directors ”.

Audit Committee Members

Brian Regli, Richard Burton, and Scott McDonald,

each of whom has been determined by the board of directors to satisfy the “independence” requirements of Rule 10A-3

under the Exchange Act and Nasdaq’s rules, serve on our audit committee, with Mr.

Regli serving as the chairman.

Burton, John A.

Jack II, and Scott

McDonald, each of whom has been determined by the board of directors to satisfy the “independence” requirements of Rule 10A-3

under the Exchange Act and Nasdaq’s rules, serve on the Audit Committee, with Mr.

Burton serving as the chairman.

Our board has

determined that Mr.

Regli qualifies as an “audit committee financial expert.”

Burton qualifies as an “audit committee financial expert” as defined by Item 407(d)(5) of Regulation S-K

promulgated by the SEC.

Material Changes to Director Nomination Procedures

3 unchanged sentences

We have adopted a Code of Ethics and Business

Conduct that applies to all of our directors, officers and employees, including our principal executive officer, principal financial

officer and principal accounting officer.

Such Code of Ethics and Business Conduct addresses, among other things, honesty and ethical

conduct, conflicts of interest, compliance with laws, regulations and policies, including disclosure requirements under the federal securities

laws, and reporting of violations of the code.

Conduct that applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer

and principal accounting officer.

Such Code of Ethics and Business Conduct addresses, among other things, honesty and ethical conduct,

conflicts of interest, compliance with laws, regulations and policies, including disclosure requirements under the federal securities

laws, and reporting of violations of the Code of Ethics and Business Conduct.

The full text of the Code of Ethics and Business

Conduct is attached as Exhibit 14.1 to this Annual Report and posted on our website at https://www.assetentities.com/.

Conduct is attached as Exhibit 14.1 to this Annual Report and posted on our website at https://assetentities.gcs-web.com.

Any waiver of

the Code of Ethics and Business Conduct for directors or executive officers must be approved by our Audit Committee.

the Code of Ethics and Business Conduct for directors or executive officers must be approved by the Audit Committee.

We will disclose

future amendments to our Code of Ethics and Business Conduct, or waivers from our Code of Ethics and Business Conduct for our principal

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

on our website within four business days following the date of the amendment or waiver.

In addition, we will disclose any waiver

from our Code of Ethics and Business Conduct for our other executive officers and our directors on our website.

A copy of our Code of

Ethics and Business Conduct will also be provided free of charge upon request to:

Secretary, Asset Entities Inc., 100 Crescent Ct, 7th

Floor, Dallas, TX 75201.

executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, on

our website within four business days following the date of the amendment or waiver.

In addition, we will disclose any waiver from

our Code of Ethics and Business Conduct for our other executive officers and our directors on our website.

A copy of our Code of Ethics

and Business Conduct will also be provided free of charge upon request to:

Secretary, Asset Entities Inc., 100 Crescent Ct, 7th Floor,

Dallas, TX 75201.

Insider Trading Policy

11 unchanged sentences

information, and written representations by the persons required to file such reports, we believe that during the fiscal year ended December

31, 2023, there were no delinquent Section 16(a) reports.

31, 2024, there were no delinquent Section 16(a) reports, except the following:

Each of AEH, Arman Sarkhani, Arshia Sarkhani, Jackson

Fairbanks, Kyle Fairbanks, Matthew Krueger, and Michael Gaubert filed a late Form 4 to report three transactions on September 16, 2024.

EXECUTIVE COMPENSATION.

Summary Compensation Table - Years Ended December 31, 2024 and 2023

The following table sets forth information concerning

all cash and non-cash compensation awarded to, earned by or paid to the named persons for services rendered in all capacities during

the noted periods.

No other executive officers received total compensation in excess of $100,000.

The following table sets forth information concerning all cash and

non-cash compensation awarded to, earned by or paid to the named persons for services rendered in all capacities during the noted periods.

Name and Principal Position

Option Awards

All Other Compensation

Arshia Sarkhani,

Executive Officer and

Chief Executive Officer and President

Michael Gaubert,

1 unchanged sentence

Kyle Fairbanks,

Executive Vice-Chairman and

Chief Marketing

(1) On February 7, 2023, Arshia Sarkhani was granted 200,000 shares

of common stock subject to vesting as to approximately one-third of the total granted shares on each of the first three anniversaries

of the grant date.

The aggregate grant date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the

assumptions described in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report.

(2) All other compensation consisted of health

(3) All other compensation consisted of consulting

(4) On February 7, 2023, Michael Gaubert was

granted 225,500 shares of common stock subject to vesting as to approximately one-third of

the total granted shares on each of the first three anniversaries of the grant date.

aggregate grant date fair value of this award was computed in accordance with FASB ASC Topic

718 based on the assumptions described in Note 2 to the Company’s financial statements

beginning on page F-1 of this Annual Report.

(5) All other compensation consisted of consulting

fees and health insurance.

(6) On February 7, 2023, Kyle Fairbanks was granted

200,000 shares of common stock subject to subject to vesting as to approximately one-third

of the total granted shares on each of the first three anniversaries of the grant date.

aggregate grant date fair value of this award was computed in accordance with FASB ASC Topic

718 based on the assumptions described in Note 2 to the Company’s financial statements

beginning on page F-1 of this Annual Report.

Executive Employment and Consulting Agreements

Under the employment letter agreement between

the Company and the Company’s Chief Executive Officer and President, Arshia Sarkhani, dated as of April 21, 2022, the term of the

agreement commenced as of the closing of our initial public offering on February 7, 2023, and will continue for two years unless terminated

earlier in accordance with its terms.

During the term of the agreement, the Company will pay Mr.

Sarkhani an annual salary of $240,000

and paid an initial cash bonus of $10,000.

Sarkhani will be eligible to receive an annual cash bonus as determined by the Company’s

board of directors.

Pursuant to the employment letter agreement, following the closing of the initial public offering, on February 7,

2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Sarkhani granting restricted stock under

the Plan in the amount of 200,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted

shares on each of the first three anniversaries of the grant date.

Upon a change of control of the Company, all of the shares will vest

Under the employment letter agreement, Mr.

Sarkhani will be eligible to participate in standard benefits plans offered to

similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company policies.

The employment

letter agreement also has certain confidentiality and non-competition provisions.

The Company previously entered into its standard form

of directors and officers indemnification agreement with Mr.

Sarkhani, and provided standard directors and officers liability insurance,

in accordance with the employment letter agreement.

Under the employment letter agreement between

the Company and the Company’s Chief Experience Officer, Derek Dunlop, dated as of April 21, 2022, the term of the agreement commenced

as of the closing of the initial public offering on February 7, 2023, and will continue for two years unless terminated earlier in accordance

with its terms.

During the term of the agreement, the Company will pay Mr.

Dunlop an annual salary of $220,000 and paid an initial cash

bonus of $10,000.

Dunlop will be eligible to receive an annual cash bonus as determined by the Company’s board of directors.

Pursuant to the employment letter agreement, following the closing of the initial public offering, on February 7, 2023, the Company entered

into its standard form of restricted stock award agreement with Mr.

Dunlop granting restricted stock under the Plan in the amount of

225,500 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each of the first

three anniversaries of the grant date.

Upon a change of control of the Company, all of the shares will vest immediately.

Under the employment

letter agreement, Mr.

Dunlop will be eligible to participate in standard benefits plans offered to similarly-situated employees by the

Company from time to time, subject to plan terms and generally applicable Company policies.

The employment letter agreement also has

certain confidentiality and non-competition provisions.

The Company previously entered into its standard form of directors and officers

indemnification agreement with Mr.

Dunlop, and provided standard directors and officers liability insurance, in accordance with the employment

letter agreement.

Under the employment letter agreement between

the Company and the Company’s Chief Financial Officer, Treasurer and Secretary, Matthew Krueger, dated as of April 21, 2022, the

term of the agreement commenced as of the closing of the initial public offering on February 7, 2023, and will continue for two years

unless terminated earlier in accordance with its terms.

During the term of the agreement, the Company will pay Mr.

Krueger an annual

salary of $180,000 and paid an initial cash bonus of $25,000.

Krueger will be eligible to receive an annual cash bonus as determined

by the Company’s board of directors.

Pursuant to the employment letter agreement, following the closing of the initial public offering,

on February 7, 2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Krueger granting restricted

stock under the Plan in the amount of 198,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the

total granted shares on each of the first three anniversaries of the grant date.

Upon a change of control of the Company, all of the

shares will vest immediately.

Under the employment letter agreement, Mr.

Krueger will be eligible to participate in standard benefits

plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company

The employment letter agreement also has certain confidentiality and non-competition provisions.

The Company previously entered

into its standard form of directors and officers indemnification agreement with Mr.

Krueger, and provided standard directors and officers

liability insurance, in accordance with the employment letter agreement.

Under the employment letter agreement between

the Company and the Company’s Executive Vice-Chairman and Chief Marketing Officer, Kyle Fairbanks, dated as of April 21, 2022,

the term of the agreement commenced as of the closing of the initial public offering on February 7, 2023, and will continue for two years

unless terminated earlier in accordance with its terms.

During the term of the agreement, the Company will pay Mr.

Fairbanks an annual

salary of $240,000 and paid an initial cash bonus of $10,000.

Fairbanks will be eligible to receive an annual cash bonus as determined

by the Company’s board of directors.

Pursuant to the employment letter agreement, following the closing of the initial public offering,

Executive Vice-Chairman and Chief Marketing Officer

(1) On December 27, 2024, Arshia Sarkhani was granted 13,254 shares of Class B Common Stock.

The aggregate

grant date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to

the Company’s financial statements beginning on page F-1 of this Annual Report.

(2) On February 7, 2023, Arshia Sarkhani was granted 40,000 shares of Class B Common Stock subject to vesting

as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

The aggregate grant

date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s

financial statements beginning on page F-1 of this Annual Report.

(3) On December 27, 2024, Michael Gaubert was granted 20,500 shares of Class B Common Stock.

The aggregate

grant date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to

the Company’s financial statements beginning on page F-1 of this Annual Report.

(4) On February 7, 2023, Michael Gaubert was granted 45,100 shares of Class B Common Stock subject to vesting

as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

The aggregate grant

date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s

financial statements beginning on page F-1 of this Annual Report.

(5) All other compensation consisted of consulting fees and health insurance.

(6) On December 27, 2024, Kyle Fairbanks was granted 10,000 shares of Class B Common Stock.

The aggregate

grant date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to

the Company’s financial statements beginning on page F-1 of this Annual Report.

(7) On February 7, 2023, Kyle Fairbanks was granted 40,000 shares of Class B Common Stock subject to subject

to vesting as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

The aggregate

grant date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to

the Company’s financial statements beginning on page F-1 of this Annual Report.

Employment and Consulting Agreements

Under the Prior Arshia Sarkhani Employment Agreement,

the term of the Prior Arshia Sarkhani Employment Agreement commenced as of the closing of our initial public offering on February 7, 2023,

and terminated on February 7, 2025 in accordance with its terms.

During the term of the Prior Arshia Sarkhani Employment Agreement, the

Company paid Mr.

Sarkhani an annual salary of $240,000 and paid an initial cash bonus of $10,000.

Sarkhani was eligible to receive

an annual cash bonus as determined by the board of directors.

Pursuant to the Prior Arshia Sarkhani Employment Agreement, following the

closing of the initial public offering, on February 7, 2023, the Company entered into its standard form of restricted stock award agreement

Sarkhani granting restricted stock under the Plan in the amount of 40,000 shares of Class B Common Stock subject to vesting as

to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

Upon a change of control

of the Company, all of the shares will vest immediately.

Under the Prior Arshia Sarkhani Employment Agreement, Mr.

Sarkhani was eligible

to participate in standard benefits plans offered to similarly-situated employees by the Company from time to time, subject to plan terms

and generally applicable Company policies.

The Prior Arshia Sarkhani Employment Agreement also contained certain confidentiality provisions.

Under the Prior Kyle Fairbanks Agreement, the

term of the Prior Kyle Fairbanks Agreement commenced as of the closing of the initial public offering on February 7, 2023, and terminated

on February 7, 2025 in accordance with its terms.

During the term of the Prior Kyle Fairbanks Agreement, the Company paid Mr.

an annual salary of $240,000 and paid an initial cash bonus of $10,000.

Fairbanks was eligible to receive an annual cash bonus as

determined by the board of directors.

Pursuant to the Prior Kyle Fairbanks Agreement, following the closing of the initial public offering,

on February 7, 2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Fairbanks granting restricted

stock under the Plan in the amount of 200,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the

total granted shares on each of the first three anniversaries of the grant date.

Upon a change of control of the Company, all of the

shares will vest immediately.

Under the employment letter agreement, Mr.

Fairbanks will be eligible to participate in standard benefits

plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company

The employment letter agreement also has certain confidentiality and non-competition provisions.

The Company previously entered

into its standard form of directors and officers indemnification agreement with Mr.

Fairbanks, and provided standard directors and officers

liability insurance, in accordance with the employment letter agreement.

Under the employment letter agreement between

the Company and the Company’s Chief Operating Officer, Arman Sarkhani, dated as of April 21, 2022, the term of the agreement commenced

as of the closing of the initial public offering on February 7, 2023, and will continue for two years unless terminated earlier in accordance

with its terms.

During the term of the agreement, the Company will pay Mr.

Sarkhani an annual salary of $125,000 and paid an initial

cash bonus of $10,000.

Sarkhani will be eligible to receive an annual cash bonus as determined by the Company’s board of directors.

Pursuant to the employment letter agreement, following the closing of the initial public offering, on February 7, 2023, the Company entered

into its standard form of restricted stock award agreement with Mr.

Sarkhani granting restricted stock under the Plan in the amount of

163,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each of the first

three anniversaries of the grant date.

stock under the Plan in the amount of 40,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the total

granted shares on each of the first three anniversaries of the grant date.

Upon a change of control of the Company, all of the shares

will vest immediately.

Under the Prior Kyle Fairbanks Agreement, Mr.

Fairbanks was eligible to participate in standard benefits plans

offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company policies.

The Prior Kyle Fairbanks Agreement also contained certain confidentiality provisions.

Under the Prior Krueger Agreement, the term of

the Prior Krueger Agreement commenced as of the closing of the initial public offering on February 7, 2023, and terminated on February

7, 2025 in accordance with its terms.

During the term of the Prior Krueger Agreement, the Company paid Mr.

Krueger an annual salary of

$180,000 and paid an initial cash bonus of $25,000.

Krueger was eligible to receive an annual cash bonus as determined by the board

of directors.

Pursuant to the Prior Krueger Agreement, following the closing of the initial public offering, on February 7, 2023, the

Company entered into its standard form of restricted stock award agreement with Mr.

Krueger granting restricted stock under the Plan in

the amount of 39,600 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each

of the first three anniversaries of the grant date.

Upon a change of control of the Company, all of the shares will vest immediately.

Under the employment

letter agreement, Mr.

Sarkhani will be eligible to participate in standard benefits plans offered to similarly-situated employees by

the Company from time to time, subject to plan terms and generally applicable Company policies.

The employment letter agreement also

has certain confidentiality and non-competition provisions.

The Company previously entered into its standard form of directors and officers

indemnification agreement with Mr.

Sarkhani, and provided standard directors and officers liability insurance, in accordance with the

employment letter agreement.

On August 15, 2023, Mr.

Sarkhani’s employment agreement letter was amended and pursuant to such amendment

his annual salary increased to $150,000 effective as of September 1, 2023.

Under the employment letter agreement between

the Company and the Company’s Chief Technology Officer, Jason Lee, dated as of November 10, 2023, the term of the agreement commenced

as of November 15, 2023, and will continue for two years unless terminated earlier in accordance with its terms.

During the term of the

agreement, the Company will pay Mr.

Under the Prior Krueger Agreement, Mr.

Krueger was eligible to participate in standard benefits plans offered to similarly-situated employees

by the Company from time to time, subject to plan terms and generally applicable Company policies.

The Prior Krueger Agreement also contained

certain confidentiality provisions.

Under the letter agreement between the Company

and Arman Sarkhani, the Company’s Chief Operating Officer, dated as of April 21, 2022 (the “Prior Arman Sarkhani Employment

Agreement”), the term of the Arman Sarkhani Employment Agreement commenced as of the closing of the initial public offering on February

7, 2023, and terminated on February 7, 2025 in accordance with its terms.

During the term of the Arman Sarkhani Employment Agreement,

the Company paid Mr.

Sarkhani an annual salary of $125,000 and paid an initial cash bonus of $10,000.

On August 15, 2023, the Arman Sarkhani

Employment Agreement was amended to provide for an annual salary of $150,000 effective as of September 1, 2023.

Sarkhani was eligible

to receive an annual cash bonus as determined by the board of directors.

Pursuant to the Arman Sarkhani Employment Agreement, following

the closing of the initial public offering, on February 7, 2023, the Company entered into its standard form of restricted stock award

agreement with Mr.

Sarkhani granting restricted stock under the Plan in the amount of 32,600 shares of Class B Common Stock subject to

vesting as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

Upon a change

of control of the Company, all of the shares will vest immediately.

Under the Arman Sarkhani Employment Agreement, Mr.

Sarkhani was eligible

to participate in standard benefits plans offered to similarly-situated employees by the Company from time to time, subject to plan terms

and generally applicable Company policies.

The Arman Sarkhani Employment Agreement also contained certain confidentiality provisions.

Under the letter agreement between the Company

and Jason Lee, the Company’s Chief Technology Officer, dated as of November 10, 2023 (the “Lee Agreement”), the term

of the agreement commenced as of November 15, 2023, and will continue for two years unless terminated earlier in accordance with its terms.

During the term of the Lee Agreement, the Company will pay Mr.

Lee an annual salary of $100,000.

Pursuant to the employment letter agreement, the Company entered

into its standard form of restricted stock award agreement with Mr.

Lee granting restricted stock under the Plan in the amount of 177,000

shares of Class B Common Stock subject to vesting as one-fourth of the total granted shares on each of the first four six-month anniversaries

of the grant date.

Under the employment letter agreement, Mr.

Lee will be eligible to participate in standard benefits plans offered

to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company policies.

employment letter agreement also has certain confidentiality and non-competition provisions.

The Company also entered into its standard

form of directors and officers indemnification agreement with Mr.

Lee, and provided standard directors and officers liability insurance,

in accordance with the employment letter agreement.

Under the employment letter agreement between

the Company and the Company’s Director of Socials and former Chief Marketing Officer, Jackson Fairbanks, dated as of April 21, 2022,

the term of the agreement commenced as of the closing of the initial public offering on February 7, 2023, and will continue for two years

unless terminated earlier in accordance with its terms.

During the term of the agreement, the Company will pay Mr.

Fairbanks an annual

salary of $125,000 and an initial cash bonus of $10,000.

Fairbanks will be eligible to receive an annual cash bonus as determined

by the Company’s board of directors.

Pursuant to the employment letter agreement, following the closing of the initial public offering,

on February 7, 2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Fairbanks granting restricted

stock under the Plan in the amount of 163,000 shares of Class B Common Stock to vest equally over three years on each anniversary of the

Upon a change of control of the Company, all of the shares will vest immediately.

Under the employment letter agreement, Mr.

Fairbanks will be eligible to participate in standard benefits plans offered to similarly-situated employees by the Company from time

to time, subject to plan terms and generally applicable Company policies.

The employment letter agreement also has certain confidentiality

and non-competition provisions.

The Company previously entered into its standard form of directors and officers indemnification agreement

Fairbanks, and provided standard directors and officers liability insurance, in accordance with the employment letter agreement.

Each of the above employment letter agreements

may be terminated by the Company only for “cause”.

“Cause” is defined as (a) conviction of or plea of guilty

or nolo contendere to a felony under the laws of the United States or any state thereof;

(b) commission of fraud or embezzlement on the

Company or any of its subsidiaries;

Pursuant to the Lee Agreement, the Company

entered into its standard form of restricted stock award agreement with Mr.

Lee granting restricted stock under the Plan in the amount

of 35,400 shares of Class B Common Stock subject to vesting as to one-fourth of the total granted shares on each of the first four six-month

anniversaries of the grant date.

Under the Lee Agreement, Mr.

Lee will be eligible to participate in standard benefits plans offered to

similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company policies.

Agreement also contains certain confidentiality provisions.

Lee may terminate the Lee Agreement at will.

Each of the above letter agreements could or may

be terminated by the Company only for “cause”.

Each of the agreements defined “cause” as (a) conviction of or

plea of guilty or nolo contendere to a felony under the laws of the United States or any state thereof;

(b) commission of fraud or embezzlement

on the Company or any of its subsidiaries;

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material reputational harm to the Company or any of its subsidiaries;

(f) a material violation of the Company’s (or any of its

subsidiaries’) bona fide, written equal employment opportunity, antidiscrimination, anti-harassment, or anti-retaliation policies;

(g) material breach of this agreement;

(h) the consistent abuse of alcohol, prescription drugs or controlled substances, which interferes

with the performance of the officer’s duties to the Company;

(i) failure to execute the duties and responsibilities of the officer

position which the officer holds;

(f) a material violation of the Company’s (or any of its subsidiaries’)

bona fide, written equal employment opportunity, antidiscrimination, anti-harassment, or anti-retaliation policies;

(g) material breach

of this agreement;

(h) the consistent abuse of alcohol, prescription drugs or controlled substances, which interferes with the performance

of the officer’s duties to the Company;

(i) failure to execute the duties and responsibilities of the officer position which the

officer holds;

(j) a breach or default of the officer’s obligations to the Company or under the agreement;

(k) excessive absenteeism other than for reasons of illness.

Each officer may terminate such officer’s employment letter agreement

Under the consulting letter agreement between

the Company and the Company’s Executive Chairman, Michael Gaubert, dated as of April 21, 2022, the term of the agreement commenced

as of the closing of the initial public offering on February 7, 2023, and will continue for two years unless terminated earlier in accordance

with its terms.

During the term of the agreement, the Company will pay Mr.

Gaubert an annual salary of $240,000 and paid an initial cash

bonus of $50,000.

Gaubert will be eligible to receive an annual cash bonus as determined by the Company’s board of directors.

Pursuant to the consulting letter agreement, following the closing of the initial public offering, on February 7, 2023, the Company entered

into its standard form of restricted stock award agreement with Mr.

Gaubert granting restricted stock under the Plan in the amount of

225,500 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each of the first

three anniversaries of the grant date.

Upon a change of control of the Company, all of the shares will vest immediately.

Under the consulting

letter agreement, Mr.

Gaubert will be eligible to participate in standard benefits plans offered to similarly-situated employees by the

Company from time to time, subject to plan terms and generally applicable Company policies.

The consulting letter agreement also has

certain confidentiality and non-competition provisions.

The Company previously entered into its standard form of directors and officers

indemnification agreement with Mr.

Gaubert, and provided standard directors and officers liability insurance, in accordance with the

employment letter agreement.

The consulting letter agreement can be terminated by either party upon 30 days’ advance written notice.

A copy of each employment

letter agreement with each of Mr.

Arshia Sarkhani, Mr.

Kyle Fairbanks, Mr.

Arman Sarkhani, Mr.

Jason Lee, and

Jackson Fairbanks is filed as Exhibit 10.1, Exhibit 10.2, Exhibit 10.3, Exhibit 10.4, Exhibit 10.5, Exhibit 10.6, and Exhibit 10.31

to this Annual Report, respectively;

a copy of the amendment to the employment letter agreement of Mr.

Arman Sarkhani is filed as Exhibit

10.28 to this Annual Report;

a copy of the consulting agreement with Mr.

Gaubert is filed as Exhibit 10.7, to this Annual Report;

of the Plan is filed as Exhibit 10.16 to this Annual Report;

the form of restricted stock award agreement for the Plan is filed as Exhibit

10.18 to this Annual Report;

and the form of indemnification agreement with each officer or director is filed as Exhibit 10.15 to this

Annual Report.

The description above is qualified in its entirety by reference to each respective exhibit.

or (k) excessive absenteeism

other than for reasons of illness.

Under the Prior Gaubert

Agreement, the term of the Prior Gaubert Agreement commenced as of the closing of the initial public offering on February 7, 2023, and

terminated on February 7, 2025 in accordance with its terms.

During the term of the Prior Gaubert Agreement, the Company paid Mr.

an annual salary of $240,000.

The Company paid an initial cash bonus of $50,000 during 2023.

Gaubert was eligible to receive an annual

cash bonus as determined by the board of directors.

Pursuant to the Prior Gaubert Agreement, following the closing of the initial public

offering, on February 7, 2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Gaubert granting

restricted stock under the Plan in the amount of 45,100 shares of Class B Common Stock subject to vesting as to approximately one-third

of the total granted shares on each of the first three anniversaries of the grant date.

Upon a change of control of the Company, all of

the shares will vest immediately.

Under the Prior Gaubert Agreement, Mr.

Gaubert will be eligible to participate in standard benefits

plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Company

The Prior Gaubert Agreement also contained certain confidentiality provisions.

Each of the executive officers named above was

required to sign an Employee Confidential Information and Inventions Assignment Agreement or similar agreement which prohibits unauthorized

use or disclosure of the Company’s proprietary information, contains a general assignment of rights to inventions and intellectual

property rights, non-competition provisions that apply during the term of employment, non-solicitation provisions that apply during the

term of employment and for one year after the term of employment, and non-disparagement provisions that apply during and after the term

of employment.

The information under Item 9B.

Information – New Executive Employment and Consulting Agreements ” is incorporated by reference herein.

Outstanding Equity

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unexercised options, stock that has not vested, or equity incentive plan awards outstanding as of December 31, 2024.

Option Awards

unexercised options

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unexercisable

expiration date

Arshia Sarkhani

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Kyle Fairbanks

(1) On February 7, 2023, Arshia Sarkhani

was granted 200,000 shares of common stock subject to vesting as to approximately one-third

of the total granted shares on each of the first three anniversaries of the grant date.

(2) On February 7, 2023, Michael Gaubert

was granted 225,500 shares of common stock subject to vesting as to approximately one-third

of the total granted shares on each of the first three anniversaries of the grant date.

(3) On February 7, 2023, Kyle Fairbanks

was granted 200,000 shares of common stock subject to subject to vesting as to approximately

one-third of the total granted shares on each of the first three anniversaries of the grant

(1) On February 7, 2023, Arshia Sarkhani was granted 40,000 shares of common stock subject to vesting as to

approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

(2) On February 7, 2023, Michael Gaubert was granted 45,100 shares of common stock subject to vesting as to

approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

(3) On February 7, 2023, Kyle Fairbanks was granted 40,000 shares of common stock subject to subject to vesting

as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date.

Additional Narrative Disclosure

Retirement Benefits

We have not maintained, and do not currently

maintain, a defined benefit pension plan, nonqualified deferred compensation plan or other retirement benefits.

Potential Payments Upon Termination or

Change in Control

We have not maintained, and do not currently maintain,

a defined benefit pension plan, nonqualified deferred compensation plan or other retirement benefits.

Potential Payments Upon Termination or Change

See “ —Executive Employment and

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Director Compensation

The directors of the Company were compensated

for services as directors during the fiscal year ended December 31, 2023 as follows:

Fees Earned or Paid in Cash

Option Awards

Non-Equity Incentive Plan Compensation

All Other Compensation

The directors

of the Company were compensated for services as directors during the fiscal year ended December 31, 2024 as follows:

Incentive Plan

David Reynolds

Brian Regli (3)

(1) On February 7, 2023, each of Richard A.

Burton, John A.

McDonald, and Brian Regli was granted 9,000 shares of common stock subject to vesting as to 2,250 shares of common stock

in each of the first, second, third, and fourth calendar quarters following the grant date.

The aggregate grant date fair value of this

award was computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s financial

statements beginning on page F-1 of this Annual Report.

All of the granted shares remained outstanding as of December 31, 2023.

Jack II, Scott K.

McDonald, and Brian Regli was

granted 1,800 shares of Class B Common Stock, subject to vesting as to one-fourth of the granted shares in each of the first, second,

third, and fourth calendar quarters following the grant date.

On November 11, 2024, each of Mr.

Jack, and Mr.

granted 8,200 shares of Class B Common Stock, subject to vesting as to one-fourth of the granted shares on each of the grant date, the

three-month anniversary of the grant date, the six-month anniversary of the grant date, and the nine-month anniversary of the grant date.

The aggregate grant date fair value of this award was computed in accordance with FASB ASC Topic 718 based on the assumptions described

in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report.

All of the granted shares remained

outstanding as of December 31, 2024.

(2) On May 15, 2024, David Reynolds was granted 1,800 shares of Class B Common Stock, subject to vesting as

to 450 shares of Class B Common Stock in each of the first, second, third, and fourth calendar quarters following the grant date, subject

to vesting as to one-fourth of the granted shares in each of the first, second, third, and fourth calendar quarters following the grant

On November 11, 2024, Mr.

Reynolds was granted 1,200 shares of Class B Common Stock, subject to vesting as to one-fourth of the

granted shares on each of the grant date, the three-month anniversary of the grant date, the six-month anniversary of the grant date,

and the nine-month anniversary of the grant date.

On December 27, 2024, Mr.

Reynolds was granted 2,000 shares of Class B Common Stock.

The aggregate grant date fair value of these awards was computed in accordance with FASB ASC Topic 718 based on the assumptions described

in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report.

All of the granted shares remained

outstanding as of December 31, 2024.

(3) Brian Regli was a director of the Company from February 2, 2023 to May 16, 2024.

Additional Narrative Disclosure

Each of the Company’s independent directors

Burton, John A.

Jack II, Scott K.

McDonald, and Brian Regli, has entered into an Independent Director Agreement (each, an

“Independent Director Agreement”).

Under the Independent Director Agreement between us and each of our independent directors,

each independent director will receive an annual cash fee and an initial award of restricted common stock.

We will pay the annual cash

compensation fee to each independent director in four equal installments no later than the fifth business day of each calendar quarter

commencing in the quarter following the date of the director’s appointment.

Each of the independent directors was automatically

elected pursuant to the effectiveness of the IPO Registration Statement on February 2, 2023.

As such, cash fee payments under each Independent

Director Agreement began in the second quarter of 2023.

The cash fee to be paid to each independent director will be $49,000 as to Mr.

Richard Burton, $40,000 as to Mr.

John Jack, $49,000 as to Mr.

Scott McDonald, and $49,000 as to Mr.

In addition, under

their agreements, on February 7, 2023, 9,000 restricted shares of common stock were awarded to each independent director following each

director’s appointment.

The restricted stock vests in four (4) equal quarterly installments commencing in the quarter following

the date of grant.

We will also reimburse each independent director for pre-approved reasonable business-related expenses incurred in

good faith in connection with the performance of the director’s duties for us.

As also required under each Independent Director

Agreement, we have separately entered into a standard indemnification agreement with each of our directors, the term of which began on

the date of the director’s appointment.

A copy of each Independent Director Agreement

is attached hereto as Exhibit 10.11, Exhibit 10.12, Exhibit 10.13, and Exhibit 10.14 to this Annual Report, respectively, and the above

description of their terms is qualified in its entirety by reference to such exhibits.

have entered into an Independent Director Agreement with the Company (each, an “Independent Director Agreement”).

Independent Director Agreement, each independent director will receive an annual cash fee and an initial award of restricted Class B Common

We will pay the annual cash compensation fee to each independent director in four equal installments no later than the fifth business

day of each calendar quarter commencing in the quarter following the date of the director’s appointment.

The cash fee to be paid

to each independent director will be $40,000 per year in cash, plus $9,000 per year for as long as the director serves as a chairman of

a committee of the board.

In addition, under each Independent Director Agreement, 1,800 restricted shares of Class B Common Stock were

awarded to each independent director following each director’s appointment.

The restricted stock vests in four (4) equal quarterly

installments commencing in the quarter following the date of grant.

We will also reimburse each independent director for pre-approved

reasonable business-related expenses incurred in good faith in connection with the performance of the director’s duties for us.

As also required under each Independent Director Agreement, we have separately entered into a standard indemnification agreement with

each of our directors.

Indemnification Agreements and Directors and

Officers Liability Insurance

We have entered into a standard indemnification

agreement with each of our executive officers and directors.

We have also obtained

standard policies of insurance under which coverage is provided (a) to our directors and executive officers

against loss rising from claims made by reason of breach of duty or other wrongful act, and (b) to us with respect to payments which

we may make to such executive officers and directors pursuant to the indemnification

agreements referred to above , the Articles of Incorporation and the Bylaws, or

otherwise as a matter of law.

Asset Entities Inc.

2022 Equity Incentive Plan

On May 2, 2022, our board of directors approved,

On May 2, 2022, the board of directors approved,

and our majority stockholders ratified, the Asset Entities Inc.

2022 Equity Incentive Plan (the “Plan”).

Purpose of the Plan :

of the Plan is to advance our interests and the interests of our stockholders by providing an incentive to attract, retain and reward

persons performing services for us and by motivating such persons to contribute to our growth and profitability.

The maximum number of

shares of Class B Common Stock that may be issued pursuant to awards granted under the Plan is 2,750,000 shares.

Cancelled and forfeited

stock options and stock awards may again become available for grant under the Plan.

As of March 31, 2024, we have not granted any stock

options under the Plan and 839,000 shares remain available for issuance under the Plan.

We have granted awards for a total of 1,911,000

restricted shares of common stock under the Plan.

We intend that awards granted under the Plan be exempt from or comply with Section

409A of the Code (including any amendments or replacements of such section), and the Plan shall be so construed.

The following summary briefly describes the principal

features of the Plan and is qualified in its entirety by reference to the full text of the Plan, a copy of which is attached to this

Annual Report as Exhibit 10.16 .

Awards that may be granted include:

(a) Incentive

Stock Options, (b) Non-qualified Stock Options, (c) Stock Appreciation Rights, (d) Restricted Awards, (e) Performance

Share Awards, and (f) Performance Compensation Awards.

These awards offer our officers, employees, consultants and directors the

possibility of future value, depending on the long-term price appreciation of the Class B Common Stock and the award holder’s

continuing service with the Company.

The purpose of the

Plan is to advance our interests and the interests of our stockholders by providing an incentive to attract, retain and reward persons

performing services for us and by motivating such persons to contribute to our growth and profitability.

The maximum number of shares

of Class B Common Stock that may be issued pursuant to awards granted under the Plan is 550,000 shares.

Cancelled and forfeited stock

options and stock awards may again become available for grant under the Plan.

However, shares tendered in payment of an option, delivered

or withheld by the Company to satisfy any tax withholding obligation, or covered by a stock-settled stock appreciation right or other

awards that were not issued upon the settlement of the award will not again become available for grant under the Plan.

As of March 31, 2025, we have granted awards for

a total of 550,000 shares of Class B Common Stock under the Plan and we have not granted any stock options under the Plan.

31, 2025, there are no shares remaining available for issuance under the Plan.

We intend that awards granted under the Plan be exempt

from or comply with Section 409A of the U.S.

Internal Revenue Code of 1986, as amended (the “Code”) (including any amendments

or replacements of such section), and the Plan shall be so construed.

Summary of Principal Features of the Plan

Awards that may be granted under the Plan include:

(a) Incentive Stock Options, (b) Non-qualified Stock Options, (c) Stock Appreciation Rights, (d) Restricted Awards,

(e) Performance Share Awards, and (f) Performance Compensation Awards, each as defined by the Plan.

These awards offer our officers,

employees, consultants and directors the possibility of future value, depending on the long-term price appreciation of the Class

B Common Stock and the award holder’s continuing service with the Company.

Stock options give the option holder the right

2 unchanged sentences

Stock options granted

may be either tax-qualified stock options (so-called “incentive stock options”) or non-qualified stock options.

may be either Incentive Stock Options or Non-qualified Stock Options.

Stock Appreciation Rights, or SARs, may be granted

alone or in tandem with options, and have an economic value similar to that of options.

When a SAR for a particular number of shares

is exercised, the holder receives a payment equal to the difference between the fair market value of the shares on the date of exercise

and the exercise price of the shares under the SAR.

The exercise price for SARs is normally the market price of the shares on the date

the SAR is granted.

Under the Plan, holders of SARs may receive this payment — the appreciation value — either

in cash or shares of Class B Common Stock valued at the fair market value on the date of exercise.

The form of payment will be determined

by the Compensation Committee of the board of directors.

When a SAR for a particular number of shares is

exercised, the holder receives a payment equal to the difference between the fair market value of the shares on the date of exercise and

the exercise price of the shares under the SAR.

The exercise price for SARs is normally the market price of the shares on the date the

SAR is granted.

Under the Plan, holders of SARs may receive this payment — the appreciation value — either in cash

or shares of Class B Common Stock valued at the fair market value on the date of exercise.

The form of payment will be determined by the

administrator.

Restricted Awards are awards of shares of Class

B Common Stock or rights to shares of Class B Common Stock to participants at no cost.

Restricted stock awards represent issued and outstanding

shares of Class B Common Stock which may be subject to vesting criteria under the terms of the award within the discretion of the Compensation

Restricted stock units represent the right to receive shares of Class B Common Stock which may be subject to satisfaction

of vesting criteria under the terms of the award within the discretion of the Compensation Committee.

Restricted stock and the rights

under restricted stock units are forfeitable and non-transferable until they vest.

The vesting date or dates and other conditions

for vesting are established when the shares are awarded.

Restricted Stock (as defined by the Plan) represents

issued and outstanding shares of Class B Common Stock which may be subject to vesting criteria under the terms of the award within the

discretion of the administrator.

Restricted Stock Units (as defined by the Plan) represent the right to receive shares of Class B Common

Stock which may be subject to satisfaction of vesting criteria under the terms of the award within the discretion of the administrator.

Restricted Stock and the rights under Restricted Stock Units are forfeitable and non-transferable until they vest.

The vesting date

or dates and other conditions for vesting are established when the shares are awarded.

The Plan also provides for Performance Compensation

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based on the attainment of pre-established goals.

All of the permissible types of awards under

the Plan are described in more detail as follows:

Purposes of Plan:

purposes of the Plan are (a) to enable the Company and any affiliate company to attract and retain the types of employees, consultants

and directors who will contribute to the Company’s long-term success;

(b) provide incentives that align the interests of employees,

consultants and directors with those of the stockholders of the Company;

Principal Features of the Plan

Purposes of the Plan:

of the Plan are (a) to enable the Company and any affiliate company to attract and retain the types of employees, consultants and directors

who will contribute to the Company’s long-term success;

(b) provide incentives that align the interests of employees, consultants

and directors with those of the stockholders of the Company;

and (c) promote the success of the Company’s business.

Administration of the Plan:

The Plan is administered by the Compensation Committee.

Among other things, the Compensation Committee has the authority to select

persons who will receive awards, determine the types of awards and the number of shares to be covered by awards, and to establish

the terms, conditions, performance criteria, restrictions and other provisions of awards.

The Compensation Committee has authority

to establish, amend and rescind rules and regulations relating to the Plan.

Plan is administered by the Compensation Committee.

In this summary, we refer to the Compensation Committee as the administrator.

other things, the administrator has the authority to select persons who will receive awards, determine the types of awards and the number

of shares to be covered by awards, and to establish the terms, conditions, performance criteria, restrictions and other provisions of

The administrator has authority to establish, amend and rescind rules and regulations relating to the Plan.

Eligible Recipients:

eligible to receive awards under the Plan are employees (including officers or directors who are also treated as employees);

i.e., persons engaged to provide consulting or advisory services to the Company;

Persons eligible

to receive awards under the Plan are employees (including officers or directors who are also treated as employees);

consultants, i.e.,

individuals engaged to provide consulting or advisory services to the Company;

and directors.

Shares Available Under the

The maximum number of shares of our Class B Common Stock that may be delivered to participants under the Plan is

2,750,000, subject to adjustment for certain corporate changes affecting the shares, such as stock splits.

Shares subject to an

award under the Plan which is canceled, forfeited or expires again become available for grants under the Plan.

Shares Available Under the Plan:

The maximum number of shares of our Class B Common Stock that may be delivered to participants under the Plan is 550,000, subject to adjustment

for certain corporate changes affecting the shares, such as stock splits.

Shares subject to an award under the Plan which is canceled,

forfeited or expires again become available for grants under the Plan.

However, shares tendered in payment of an option, delivered or

withheld by the Company to satisfy any tax withholding obligation, or covered by a stock-settled SAR or other awards that were not issued

upon the settlement of the award will not again become available for grant under the Plan.

Stock Options:

Subject to the provisions

of the Plan, the Compensation Committee has the authority to determine all grants of stock options.

of the Plan, the administrator has the authority to determine all grants of stock options.

That determination will include:

(i) the number of shares subject to any option;

number of shares subject to any option;

(ii) the exercise price per share;

(iii) the expiration date of the option;

(iv) the manner, time and date of permitted exercise;

(v) other restrictions, if any, on the option or the shares underlying

and (vi) any other terms and conditions as the Compensation Committee may determine.

manner, time and date of permitted exercise;

(v) other restrictions, if any, on the option or the shares underlying the option;

(vi) any other terms and conditions as the administrator may determine.

Option Price .

7 unchanged sentences

Exercise of Options.

An option may be

exercised only in accordance with the terms and conditions of the option agreement as established by the Compensation Committee at the

time of the grant.

An option may be exercised

only in accordance with the terms and conditions of the option agreement as established by the administrator at the time of the grant.

The option must be exercised by notice to us, accompanied by payment of the exercise price.

Payments may be made in

cash or, at the option of the Compensation Committee, by actual or constructive delivery of shares of Class B Common Stock based upon

the fair market value of the shares on the date of exercise.

Payments may be made in cash or, at the option

of the administrator, by actual or constructive delivery of shares of Class B Common Stock based upon the fair market value of the shares

on the date of exercise.

Expiration or Termination.

not previously exercised, will expire on the expiration date established by the Compensation Committee at the time of grant.

of incentive stock options, such term cannot exceed ten years provided that in the case of holders of more than 10% of our voting stock,

such term cannot exceed five years.

Options will terminate before their expiration date if the holder’s service with the Company

or an affiliate company terminates before the expiration date.

The option may remain exercisable for specified periods after certain

terminations of employment, including terminations as a result of death, disability or retirement, with the precise period during which

the option may be exercised to be established by the Compensation Committee and reflected in the grant evidencing the award.

Incentive and Non-Qualified Options.

described elsewhere in this summary, an incentive stock option is an option that is intended to qualify under certain provisions of the

Internal Revenue Code of 1986, as amended, or the Code, for more favorable tax treatment than applies to non-qualified stock

Only employees may be granted incentive stock options.

Any option that does not qualify as an incentive stock option will be

a non-qualified stock option.

not previously exercised, will expire on the expiration date established by the administrator at the time of grant.

In the case of Incentive

Stock Options, such term cannot exceed ten years provided that in the case of holders of more than 10% of our voting stock, such term

cannot exceed five years.

Options will terminate before their expiration date if the holder’s service with the Company or an affiliate

company terminates before the expiration date.

The option may remain exercisable for specified periods after certain terminations of employment,

including terminations as a result of death, disability or retirement, with the precise period during which the option may be exercised

to be established by the administrator and reflected in the grant evidencing the award.

Incentive Stock Options and Non-Qualified

Stock Options.

As described elsewhere in this summary, an Incentive Stock Option is an option that is intended to qualify

under certain provisions of the Code, for more favorable tax treatment than applies to Non-qualified Stock Options.

Only employees

may be granted Incentive Stock Options.

Any option that does not qualify as an Incentive Stock Option will be a Non-qualified Stock

Under the Code, certain restrictions apply to Incentive Stock Options.

For example, the exercise price

for incentive stock options may not be less than the fair market value of the shares on the grant date and the term of the option may

not exceed ten years.

In addition, an incentive stock option may not be transferred, other than by will or the laws of descent and distribution,

and is exercisable during the holder’s lifetime only by the holder.

In addition, no incentive stock options may be granted to a

holder that is first exercisable in a single year if that option, together with all incentive stock options previously granted to the

holder that also first become exercisable in that year, relate to shares having an aggregate market value in excess of $100,000, measured

at the grant date.

Stock Appreciation Rights:

For example, the exercise price for Incentive Stock Options

may not be less than the fair market value of the shares on the grant date and the term of the option may not exceed ten years.

an Incentive Stock Option may not be transferred, other than by will or the laws of descent and distribution, and is exercisable during

the holder’s lifetime only by the holder.

In addition, no Incentive Stock Option may be granted to a holder that is first exercisable

in a single year if that option, together with all Incentive Stock Options previously granted to the holder that also first become exercisable

in that year, relate to shares having an aggregate market value in excess of $100,000, measured at the grant date.

Appreciation Rights:

Awards of SARs may be granted alone or in tandem with stock options.

the holder with the right, upon exercise, to receive a payment, in cash or shares of stock, having a value equal to the excess of the

fair market value on the exercise date of the shares covered by the award over the exercise price of those shares.

Essentially, a holder

of a SAR benefits when the market price of the Class B Common Stock increases, to the same extent that the holder of an option does,

but, unlike an option holder, the SAR holder need not pay an exercise price upon exercise of the award.

Restricted Stock Awards .

stock award is a grant of shares of Class B Common Stock.

These awards may be subject to such vesting conditions, restrictions and contingencies

as the Compensation Committee shall determine at the date of grant.

Those may include requirements for continuous service and/or the

achievement of specified performance goals.

SARs provide the holder with the

right, upon exercise, to receive a payment, in cash or shares of stock, having a value equal to the excess of the fair market value

on the exercise date of the shares covered by the award over the exercise price of those shares.

Essentially, a holder of a SAR

benefits when the market price of the Class B Common Stock increases, to the same extent that the holder of an option does, but,

unlike an option holder, the SAR holder need not pay an exercise price upon exercise of the award.

Restricted Stock .

Restricted Stock

is a grant of shares of Class B Common Stock.

These awards may be subject to such vesting conditions, restrictions and contingencies as

the administrator shall determine at the date of grant.

Those may include requirements for continuous service and/or the achievement of

specified performance goals.

Restricted Stock is forfeitable and generally non-transferable until it vests.

date or dates and other conditions for vesting are established when the shares are awarded.

The Compensation Committee may remove any

vesting or other restrictions from restricted stock whenever it may determine that, by reason of changes in applicable laws or other

changes in circumstances arising after the date of grant, such action is appropriate.

Holders of restricted stock otherwise generally

have the rights of stockholders of the Company, including voting and dividend rights, to the same extent as other stockholders of the

The vesting date or dates

and other conditions for vesting are established when the shares are awarded.

The administrator may remove any vesting or other restrictions

from Restricted Stock whenever it may determine that, by reason of changes in applicable laws or other changes in circumstances arising

after the date of grant, such action is appropriate.

Holders of Restricted Stock otherwise generally have the rights of stockholders of

the Company, including voting and dividend rights, to the same extent as other stockholders of the Company.

Restricted Stock Units .

restricted stock unit is a right to receive stock on a future date, at which time the restricted stock unit will be settled and the stock

to which it granted rights will be issued to the restricted stock unit holder.

These awards may be subject to such vesting conditions,

restrictions and contingencies as the Compensation Committee shall determine at the date of grant.

Restricted stock units are forfeitable

and generally non-transferable until they vest.

The Compensation Committee may remove any vesting or other restrictions from a restricted

stock unit whenever it may determine that, by reason of changes in applicable laws or other changes in circumstances arising after the

date of grant, such action is appropriate.

Stock Unit is a right to receive stock on a future date, at which time the Restricted Stock Unit will be settled and the stock to which

it granted rights will be issued to the Restricted Stock Unit holder.

These awards may be subject to such vesting conditions, restrictions

and contingencies as the administrator shall determine at the date of grant.

Restricted Stock Units are forfeitable and generally non-transferable until

The administrator may remove any vesting or other restrictions from a Restricted Stock Unit whenever it may determine that,

by reason of changes in applicable laws or other changes in circumstances arising after the date of grant, such action is appropriate.

A Restricted Stock Unit holder has no rights as a stockholder.

The Compensation Committee

may exercise discretion to credit a restricted stock unit with cash and stock dividends, with or without interest, and distribute such

credited amounts upon settlement of a restricted stock unit, and if the restricted stock unit is forfeited, such dividend equivalents

will also be forfeited.

The administrator may exercise discretion to credit a Restricted Stock

Unit with cash and stock dividends, with or without interest, and distribute such credited amounts upon settlement of a Restricted Stock

Unit, and if the Restricted Stock Unit is forfeited, such dividend equivalents will also be forfeited.

Performance Share Awards and Performance

Compensation Awards:

The Compensation Committee may grant performance share awards and performance compensation

A performance share means the grant of a right to receive a number of actual shares of Class B Common Stock or share units based

upon the performance of the Company during a performance period, as determined by the Compensation Committee.

The Compensation Committee

may determine the number of shares subject to the performance share award, the performance period, the conditions to be satisfied to

earn an award, and the other terms, conditions and restrictions of the award.

No payout of a performance share award will be made except

upon written certification by the Compensation Committee that the minimum threshold performance goal(s) have been achieved.

The Compensation Committee may also designate

any of the other awards described above as a performance compensation award (other than stock options and SARs granted with an exercise

price equal to or greater than the fair market value per share of Class B Common Stock on the grant date).

In addition, the Compensation

Committee shall have the authority to make an award of a cash bonus to any participant and designate such award as a performance compensation

The participant must be employed by the Company on the last day of the performance period to be eligible for payment in respect

of a performance compensation award unless otherwise provided in the applicable award agreement.

A performance compensation award will

be paid only to the extent that the Compensation Committee certifies in writing whether and the extent to which the applicable performance

goals for the performance period have been achieved and the applicable performance formula determines that the performance compensation

award has been earned.

A performance formula means, for a performance period, the one or more objective formulas applied against the

relevant performance goal to determine, with regard to the performance compensation award of a particular participant, whether all, some

portion but less than all, or none of the performance compensation award has been earned for the performance period.

The Compensation

Committee will not have the discretion to grant or provide payment in respect of a performance compensation award for a performance period

if the performance goals for such performance period have not been attained.

The Compensation Committee will establish performance

goals for each performance compensation award based upon the performance criteria that it has selected.

The performance criteria shall

be based on the attainment of specific levels of performance of the Company and may include the following:

(a) net earnings or net income

(before or after taxes);

The administrator may grant Performance Share Awards and Performance Compensation

A Performance Share Award means the grant of a right to receive a number of actual shares of Class B Common Stock or share units

based upon the performance of the Company during a performance period, as determined by the administrator.

The administrator may determine

the number of shares subject to the Performance Share Award, the performance period, the conditions to be satisfied to earn an award,

and the other terms, conditions and restrictions of the award.

No payout of a Performance Share Award will be made except upon written

certification by the administrator that the minimum threshold performance goal(s) have been achieved.

The administrator may also designate any of the

other awards described above as a Performance Compensation Award (other than stock options and SARs granted with an exercise price equal

to or greater than the fair market value per share of Class B Common Stock on the grant date).

In addition, the administrator shall have

the authority to make an award of a cash bonus to any participant and designate such award as a Performance Compensation Award.

The participant

must be employed by the Company on the last day of the performance period to be eligible for payment in respect of a Performance Compensation

Award unless otherwise provided in the applicable award agreement.

A Performance Compensation Award will be paid only to the extent that

the administrator certifies in writing whether and the extent to which the applicable performance goals for the performance period have

been achieved and the applicable performance formula determines that the Performance Compensation Award has been earned.

A performance

formula means, for a performance period, one or more objective formulas applied against the relevant performance goal to determine, with

regard to the Performance Compensation Award of a particular participant, whether all, some portion but less than all, or none of the

Performance Compensation Award has been earned for the performance period.

The administrator will not have the discretion to grant or

provide payment in respect of a Performance Compensation Award for a performance period if the performance goals for such performance

period have not been attained.

The administrator will establish performance goals

for each Performance Compensation Award based upon the performance criteria that it has selected.

The performance criteria shall be based

on the attainment of specific levels of performance of the Company and may include the following:

(a) net earnings or net income (before

or after taxes);

(b) basic or diluted earnings per share (before or after taxes);

gross revenue;

(d) gross revenue;

(e) gross profit or gross profit growth;

(f) net operating profit (before or after taxes);

(g) return on assets, capital,

invested capital, equity, or sales;

(h) cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow

return on capital);

(g) return on assets, capital, invested capital,

equity, or sales;

(h) cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow return on capital);

(i) earnings before or after taxes, interest, depreciation and/or amortization;

(j) gross or operating margins;

improvements in capital structure;

(k) improvements in capital

(l) budget and expense management;

(m) productivity ratios;

(n) economic value added or other value

added measurements;

(o) share price (including, but not limited to, growth measures and total stockholder return);

(n) economic value added or other value added measurements;

share price (including, but not limited to, growth measures and total stockholder return);

(p) expense targets;

(r) operating efficiency;

(r) operating

(s) working capital targets;

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(u) safety record;

(v) completion of acquisitions

or business expansion;

(v) completion of acquisitions or business expansion;

(w) achieving research and development goals and milestones;

(x) achieving product commercialization goals;

(y) other criteria as may be set by the Compensation Committee from time to time.

The Compensation Committee will also determine

the performance period for the achievement of the performance goals under a performance compensation award.

At any time during the first

90 days of a performance period (or such longer or shorter time period as the Compensation Committee shall determine) or at any time

thereafter, in its sole and absolute discretion, to adjust or modify the calculation of a performance goal for such performance period

in order to prevent the dilution or enlargement of the rights of participants based on the following events:

and (y) other criteria as

may be set by the administrator from time to time.

The administrator will also determine the performance

period for the achievement of the performance goals under a Performance Compensation Award.

At any time during the first 90 days of a

performance period (or such longer or shorter time period as the administrator shall determine) or at any time thereafter, in its sole

and absolute discretion, to adjust or modify the calculation of a performance goal for such performance period in order to prevent the

dilution or enlargement of the rights of participants based on the following events:

(a) asset write-downs;

litigation or claim judgments or settlements;

rules affecting reported results;

(b) litigation or claim judgments

or settlements;

(c) the effect of changes in tax laws, accounting principles, or other laws or regulatory rules affecting reported results;

(d) any reorganization and restructuring programs;

(e) extraordinary nonrecurring items as described

in Accounting Principles Board Opinion No.

30 (or any successor or pronouncement thereto) and/or in management’s discussion and

analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders for the applicable

(e) extraordinary nonrecurring items as described in Accounting Principles Board Opinion

30 (or any successor or pronouncement thereto) and/or in management’s discussion and analysis of financial condition and results

of operations appearing in the Company’s annual report to stockholders for the applicable year;

(f) acquisitions or divestitures;

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Any one or more of the performance criteria may

be used on an absolute or relative basis to measure the performance of our company, as the Compensation Committee may deem appropriate,

or as compared to the performance of a group of comparable companies, or published or special index that the Compensation Committee deems

be used on an absolute or relative basis to measure the performance of our company, as the administrator may deem appropriate, or as compared

to the performance of a group of comparable companies, or published or special index that the administrator deems appropriate.

In determining the actual size of an individual

performance compensation award, the Compensation Committee may reduce or eliminate the amount of the award through the use of negative

discretion if, in its sole judgment, such reduction or elimination is appropriate.

The Compensation Committee shall not have the discretion

to (i) grant or provide payment in respect of performance compensation awards if the performance goals have not been attained or

(ii) increase a performance compensation award above the maximum amount payable under the Plan.

Performance Compensation Award, the administrator may reduce or eliminate the amount of the award through the use of negative discretion

if, in its sole judgment, such reduction or elimination is appropriate.

The administrator shall not have the discretion to (i) grant

or provide payment in respect of Performance Compensation Awards if the performance goals have not been attained or (ii) increase

a Performance Compensation Award above the maximum amount payable under the Plan.

Other Material Provisions:

Awards will be evidenced by a written agreement, in such form as may be approved

by the Compensation Committee.

In the event of various changes to the capitalization of our company, such as stock splits, stock dividends

and similar re-capitalizations, an appropriate adjustment will be made by the Compensation Committee to the number of shares covered

by outstanding awards or to the exercise price of such awards.

The Compensation Committee generally has the power to accelerate the exercise

or vesting period of an award.

The Compensation Committee is also permitted to include in the written agreement provisions that provide

for certain changes in the award in the event of a change of control of our company, including acceleration of vesting or payment of

the value of the award in cash or stock.

Except as otherwise determined by the Compensation Committee at the date of grant, awards will

generally not be transferable, other than by will or the laws of descent and distribution.

Prior to any award distribution, to the extent

provided by the terms of an award agreement and subject to the discretion of the Compensation Committee, a participant may satisfy any

employee withholding tax requirements relating to the exercise or acquisition of Class B Common Stock under an award by tendering a cash

payment authorizing the Company to withhold shares of Class B Common Stock otherwise issuable to the participant as a result of the exercise

or acquisition of Class B Common Stock under the award (in addition to the Company’s right to withhold from any compensation paid

to the participant by the Company).

Our board has the authority, at any time, to discontinue the granting of awards.

The board also has

the authority to alter or amend the Plan or any outstanding award or may terminate the Plan as to further grants, provided that no amendment

to the Plan will be made, without the approval of our stockholders, to the extent that such approval is required by law or the rules

of an applicable securities exchange, or such alteration or amendment would change the number of shares available under the Plan or change

the persons eligible for awards under the Plan.

No amendment to an outstanding award made under the Plan that would adversely affect

the award may be made without the consent of the holder of such award.

will be evidenced by a written agreement, in such form as may be approved by the administrator.

In the event of various changes to the

capitalization of our company, such as stock splits, stock dividends and similar re-capitalizations, an appropriate adjustment will be

made by the administrator to the number of shares covered by outstanding awards or to the exercise price of such awards.

The administrator

generally has the power to accelerate the exercise or vesting period of an award.

The administrator is also permitted to include in the

written agreement provisions that provide for certain changes in the award in the event of a change of control of our company, including

acceleration of vesting or payment of the value of the award in cash or stock.

Except as otherwise determined by the administrator at

the date of grant, awards will generally not be transferable, other than by will or the laws of descent and distribution.

award distribution, to the extent provided by the terms of an award agreement and subject to the discretion of the administrator, a participant

may satisfy any employee withholding tax requirements relating to the exercise or acquisition of Class B Common Stock under an award by

tendering a cash payment authorizing the Company to withhold shares of Class B Common Stock otherwise issuable to the participant as a

result of the exercise or acquisition of Class B Common Stock under the award (in addition to the Company’s right to withhold from

any compensation paid to the participant by the Company).

The board of directors has the authority, at any time, to discontinue the granting

The board also has the authority to alter or amend the Plan or any outstanding award or may terminate the Plan as to further

grants, provided that no amendment to the Plan will be made, without the approval of our stockholders, to the extent that such approval

is required by law or the rules of an applicable securities exchange, or such alteration or amendment would change the number of shares

available under the Plan or change the persons eligible for awards under the Plan.

No amendment to an outstanding award made under the

Plan that would adversely affect the award may be made without the consent of the holder of such award.

Clawback Policy

On November 10, 2023, our board of directors

adopted a Clawback Policy in accordance with applicable Nasdaq rules (the “Clawback Policy”).

The Clawback Policy provides

that we will recover reasonably promptly the amount of erroneously awarded incentive-based compensation to any current or former executive

officers in the event that the Company is required to prepare an accounting restatement due to the material noncompliance of the Company

with any financial reporting requirement under the securities laws, including any required accounting restatement to correct an error

in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material

misstatement if the error were corrected in the current period or left uncorrected in the current period.

A copy of the Clawback Policy

has been filed as Exhibit 97.1 to this report.

On November 10, 2023, our board of directors adopted

a Clawback Policy in accordance with applicable Nasdaq rules (the “Clawback Policy”).

The Clawback Policy provides that we

will recover reasonably promptly the amount of erroneously awarded incentive-based compensation to any current or former executive officers

in the event that the Company is required to prepare an accounting restatement due to the material noncompliance of the Company with any

financial reporting requirement under the securities laws, including any required accounting restatement to correct an error in previously

issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement

if the error were corrected in the current period or left uncorrected in the current period.

A copy of the Clawback Policy has been filed

as Exhibit 97.1 to this report.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The following table sets forth certain information with respect to

the beneficial ownership of our common stock as of March 29, 2024, for (i) each of our named executive officers and directors;

of our executive officers and directors as a group;

and (iii) each other stockholder known by us to be the beneficial owner of more than

5% of any class of our outstanding voting securities.

Beneficial ownership is determined in accordance with SEC rules and

generally includes voting or investment power with respect to securities.

For purposes of this table, a person or group of persons is

deemed to have “beneficial ownership” of any shares of common stock that such person or any member of such group has the right

to acquire within sixty (60) days of March 29, 2024.

For purposes of computing the percentage of outstanding shares of our common stock

held by each person or group of persons named above, any shares that such person or persons has the right to acquire within sixty (60)

days of March 29, 2024 are deemed to be outstanding for such person, but not deemed to be outstanding for the purpose of computing the

percentage ownership of any other person.

The inclusion herein of any shares listed as beneficially owned does not constitute an admission

of beneficial ownership by any person.

The following table sets forth certain information

with respect to the beneficial ownership of our voting securities as of close of business on March 25, 2025, for:

(i) each of our named

executive officers and directors;

(ii) all of our executive officers and directors as a group;

and (iii) each other stockholder known

by us to be the beneficial owner of more than 5% of any class of our voting securities.

Beneficial ownership is determined in accordance

with the rules of the SEC and generally includes voting or investment power with respect to securities.

Under those rules, beneficial

ownership includes any shares as to which a person has sole or shared voting power or investment power, and also any shares which the

person has the right to acquire within 60 days of March 25, 2025, through the exercise or conversion of any stock option, convertible

security, warrant or other right.

Except as set forth below, each of the beneficial owners listed below has direct ownership of and sole

voting power and investment power with respect to the shares of our voting securities.

Unless otherwise indicated, the address of each

beneficial owner listed in the table below is c/o our company, Asset Entities Inc., 100 Crescent Court, 7 th Floor, Dallas,

Amount of Class A Common Stock

Percent of Class A Common Stock (%)

Amount of Class B Common Stock

Percent of Class B Common Stock

Total Voting Power (1)(2)

Arshia Sarkhani, Chief Executive Officer, President and Director (3)

Kyle Fairbanks, Chief Marketing Officer, Executive Vice-Chairman and Director (4)

Michael Gaubert, Executive Chairman and Director (5)

Burton, Director

Jack II, Director

McDonald, Director

Brian Regli, Director

Stock (%) (1)

Stock (%) (2)

Power (3) (%)

Arshia Sarkhani,

Chief Executive Officer, President and Director

Kyle Fairbanks,

Chief Marketing Officer, Executive Vice-Chairman and Director

Michael Gaubert,

Executive Chairman and Director

David Reynolds,

All directors and executive officers as a group (10 persons)

7,532,029 (6)

Asset Entities Holdings, LLC (11)

* This director held less than 1% of the outstanding shares of common

stock as of March 29, 2024.

Based on 7,532,029 shares of Class A Common Stock and 6,892,381 shares of Class B Common Stock issued and outstanding as of March 29, 2024, respectively.

The holders of Class A Common Stock are entitled to ten (10) votes for each share of Class A Common Stock held of record, and the holders of Class B Common Stock are entitled to one (1) vote for each share of Class B Common Stock held of record, on all matters submitted to a vote of the stockholders.

A total of 14,424,410 shares of common stock representing total voting power of 82,212,671 votes are outstanding as of March 29, 2024.

(3) Arshia Sarkhani is a manager, officer and

owner of Asset Entities Holdings, LLC, which holds 7,532,029 shares of Class A Common Stock.

(4) Kyle Fairbanks is a manager, officer and

owner of Asset Entities Holdings, LLC, which holds 7,532,029 shares of Class A Common Stock.

* A percentage of shares beneficially owned by a director of the

Company that does not exceed one percent of the outstanding shares of common stock as of March 25, 2025.

(1) Based on 1,000,000 shares of Class A Common Stock issued and outstanding as of March 25, 2025.

(2) Based on 13,413,162 shares of Class B Common Stock issued and outstanding as of March 25, 2025.

(3) Shares of Class A Common Stock are entitled to ten votes for each share of Class A Common Stock.

of Class B Common Stock are entitled to one vote for each share of Class B Common Stock.

Based a total of 24,083,882 outstanding votes

as of March 25, 2025, consisting of 13,413,162 votes of the Class B Common Stock, 10,000,000 votes of the Class A Common Stock, and 670,720

votes of Series A Preferred Stock on an as-converted basis.

(4) Consists of 1,000,000 shares of Class A Common Stock held by AEH.

Arshia Sarkhani is a manager, officer

and owner of AEH.

(5) Consists of (i) 39,921 shares of Class B Common Stock and (ii) 250,000 shares of Class B Common Stock

Arshia Sarkhani is a manager, officer and owner of AEH.

(6) Consists of 1,000,000 shares of Class A Common Stock held by AEH.

Kyle Fairbanks is a manager, officer

and owner of AEH.

(7) Consists of (i) 36,667 shares of Class B Common Stock and (ii) 250,000 shares of Class B Common Stock

Arshia Sarkhani is a manager, officer and owner of AEH.

Kyle Fairbanks is a manager, officer and owner of AEH.

(8) Consists of 1,000,000 shares of Class A Common Stock held by AEH.

Michael Gaubert is an officer and indirect

owner of Asset Entities Holdings, LLC, which holds 7,532,029 shares of Class A Common Stock.

(6) Includes the shares of Class A Common Stock

beneficially owned by the managers, officers and owners of Asset Entities Holdings, LLC,

which holds 7,532,029 shares of Class A Common Stock.

Asset Entities Holdings, LLC’s

managers, officers or beneficial owners are Arman Sarkhani, Arshia Sarkhani, Jackson Fairbanks,

Kyle Fairbanks, Matthew Krueger, and Michael Gaubert.

(7) Asset Entities Holdings, LLC is a Texas limited

liability company.

Arman Sarkhani, Arshia Sarkhani, Jackson Fairbanks, Kyle Fairbanks, Matthew

Krueger, and Michael Gaubert are managers, officers, or beneficial owners of Asset Entities

Holdings, LLC.

Each of them is deemed to beneficially own the shares of Class A Common Stock

owned by Asset Entities Holdings, LLC and has shared voting and dispositive powers over its

Asset Entities Holdings, LLC’s business address is 100 Crescent Court, 7 th

Floor, Dallas, TX 75201.

owner of AEH.

(9) Consists of (i) 50,567 shares of Class B Common Stock and (ii) 250,000 shares of Class B Common Stock

Michael Gaubert is an officer and indirect owner of AEH.

(10) Consists of 1,000,000 shares of Class A Common Stock held by AEH.

AEH’s managers, officers or other

beneficial owners are Arman Sarkhani, Arshia Sarkhani, Jackson Fairbanks, Kyle Fairbanks, Matthew Krueger, and Michael Gaubert, of which

Arman Sarkhani, Arshia Sarkhani, Kyle Fairbanks, Matthew Krueger, and Michael Gaubert are directors and executive officers of the Company.

(11) Asset Entities Holdings, LLC, or AEH, is a Texas limited liability company.

Arman Sarkhani, Arshia Sarkhani,

Jackson Fairbanks, Kyle Fairbanks, Matthew Krueger, and Michael Gaubert are managers, officers, or beneficial owners of AEH.

is deemed to beneficially own the shares of Class A Common Stock owned by AEH and has shared voting and dispositive powers over its shares.

Changes in Control

We do not currently have any arrangements which

if consummated may result in a change of control of our company.

There are no arrangements known to us, including

any pledge by any person of our securities, the operation of which may at a subsequent date result in a change in control of the Company.

Securities Authorized for Issuance Under Equity Compensation Plans

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about the securities authorized for issuance under our incentive plans as of December 31, 2024.

Plan Category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted-average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans approved by security holders (1)

Equity compensation plans not approved by security holders

(1) On May 2, 2022, our board of directors approved, and our majority

stockholders ratified, the Asset Entities Inc.

securities to be

exercise price

of outstanding

of securities

remaining available

for future issuance

compensation plans

(excluding securities

reflected in column

Equity compensation

plans approved by security holders (1)

Equity compensation plans not approved by security

(1) On May 2, 2022, our board of directors approved, and our majority stockholders ratified, the Asset Entities

2022 Equity Incentive Plan.

The purpose of the Plan is to grant restricted stock, stock

options and other forms of incentive compensation to our officers, employees, directors and consultants.

The maximum number of shares

of common stock that may be issued pursuant to awards granted under the Plan is 2,750,000 shares.

Cancelled and forfeited stock options

and stock awards may again become available for grant under the Plan.

The maximum number of shares of Class B Common Stock that may be issued pursuant to awards granted under

the Plan is 550,000 shares.

For a further description of the Plan, see Item 11.

Compensation – 2022 Equity Incentive Plan ”.

As of December 31, 2023, no options, warrants or rights to securities were

outstanding under the Plan, and 1,811,000 restricted shares of common stock had been granted and were outstanding under the Plan.

“ Executive Compensation – 2022 Equity Incentive

As of December 31, 2024, no options, warrants or rights to securities were outstanding under the Plan, and 550,000 shares

of Class B Common Stock had been granted and were outstanding under the Plan.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

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fiscal years, and in which any related person had or will have a direct or indirect material interest (other than compensation described

under Item 11 “ Executive Compensation ” above).

under Item 11.

“ Executive Compensation ” above).

We believe the terms obtained or consideration that we paid or received,

1 unchanged sentence

or received, as applicable, in arm’s-length transactions.

● We began our operations as a general

partnership on August 1, 2020.

California LLC was formed on October 20, 2020 to operate our

Asset Entities Inc., a Nevada corporation, was incorporated on March 9, 2022.

after the incorporation of Asset Entities Inc., all of the issued and outstanding stock of

Asset Entities Inc.

was purchased by California LLC in exchange for $1.00.

On March 28, 2022,

in accordance with Sections 17710.01-17710.19, inclusive, of the California Corporation Code

and Chapter 92A of the Nevada Revised Statutes, California LLC was merged with and into Asset

Entities Inc.

As a result of the merger, Asset Entities Inc.

acquired the business of California

Pursuant to the Agreement and Plan of Merger, the units of California LLC were automatically

converted into shares of Asset Entities Inc.

in the same proportion as the percentage interests

of California LLC represented by such units.

As a result and as further provided in the Agreement

and Plan of Merger, on March 28, 2022, AEH, which owned 97.56% of California LLC’s

units, became the holder of 9,756,000 shares of Class A Common Stock of Asset Entities Inc.,

or 97.56% of the total issued and outstanding post-merger shares of common stock of Asset

Entities Inc., or a holder of 100.0% of total issued and outstanding shares of Class A Common

Stock, and Richard A.

Benavides, MD, a holder of 2.44% of California LLC’s units became

the holder of 244,000 shares of Class B Common Stock of Asset Entities Inc., or 2.44% of

the total issued and outstanding post-merger shares of common stock of Asset Entities Inc.,

or 100.0% of the total issued and outstanding shares of Class B Common Stock prior to the

Company’s subsequent issuances of Class B Common Stock.

AEH’s managers, officers

and owners, which consisted of Arman Sarkhani, Arshia Sarkhani, Derek Dunlop, Jackson Fairbanks,

Kyle Fairbanks, Matthew Krueger, and Michael Gaubert, were also our executive officers or

directors, and were considered the beneficial owners of the shares held by AEH.

total stockholders’ equity of the Company of $33,937 as of March 31, 2022, the total

approximate dollar value of these transactions was $33,937.

Based on this transactional value

and the percentage of the total issued and outstanding shares of common stock of the Company

that each party or beneficiary acquired beneficial ownership of as a result of these transactions,

the approximate dollar value of the interest of AEH and each of its beneficial owners in

these transactions was $33,109, and the approximate dollar value of the interest of Dr.

in these transactions was $828.

● On April 21, 2022, we entered into

a Cancellation and Exchange Agreement with each of AEH, the holder of 9,756,000 shares of

Class A Common Stock, GKDB, the holder of 200,000 units of membership interests in AEH representing

20.0% ownership of AEH, and the 2022 Former GKDB Holders, the holders of an aggregate of

790,000 units of membership interests in GKDB representing 39.5% ownership in GKDB.

In accordance

with these agreements, we and AEH agreed to convert 770,724 shares of AEH’s Class A

Common Stock into 770,724 shares of Class B Common Stock and transfer such shares to GKDB,

in exchange for GKDB’s agreement to cancel and surrender 79,000 of GKDB’s 200,000

units of membership interests in AEH, representing the 2022 Former GKDB Holders’ 39.5%

● On November 10, 2023, the Company entered into an Asset Purchase Agreement (the “Asset Purchase

Agreement”) with Ternary Inc., a Florida corporation (“Ternary FL”), Ternary Developments Inc., a Delaware corporation

(“Ternary DE”), OptionsSwing Inc., a Florida corporation (together with Ternary DE and Ternary FL, the “Sellers”),

and Jason Lee, the principal shareholder of each of the Sellers, pursuant to which the Company purchased from the Sellers all of Sellers’

right, title, and interest in and to substantially all of the assets and properties owned by Sellers and used in connection with the business

of Discord development, social media, online community management, marketing, B2B SaaS that offers sales, service, marketing, and analytics.

On the same date, the Company paid the Sellers $100,000 in cash and issued 60,000 shares of Class B Common Stock.

Lee received 35,400

shares of the Class B Common Stock, which will vest equally over two years on each six-month anniversary of the grant date.

Additionally,

Lee received $20,475 of the $100,000 cash payment.

Pursuant to the Asset Purchase Agreement, the Company agreed to assume certain

liabilities including accrued liabilities (other than taxes), customer deposits and accounts payable, the obligations, duties and liabilities

with respect to the contracts used in conducting or relating to the business of the Sellers and other specified assets, in each case only

to the extent arising from and after November 10, 2023.

These assumed liabilities also exclude any obligations arising from the Sellers’

breach or default before November 10, 2023.

As required under the Asset Purchase Agreement, on November 10, 2023, the Company entered

into employment agreements with Mr.

Lee and certain employees of the Sellers and an independent contractor agreement with one individual.

Under the Lee Agreement, Mr.

Lee was appointed the Chief Technology Officer of the Company commencing November 15, 2023 for

a two-year term unless terminated earlier by Mr.

Lee or by the Company for cause or by mutual agreement.

Lee will be paid a salary

of $100,000 per year and be eligible for standard employee benefits.

In connection with the Lee Agreement, Mr.

into an Employee Confidential Information and Inventions Assignment Agreement, which prohibits unauthorized use or disclosure of the Company’s

proprietary information, contains a general assignment of rights to inventions and intellectual property rights, and contains non-competition

provisions that apply during the term of employment, employee/contractor non-solicitation provisions that apply during the term of employment

and for one year after the term of employment, and non-disparagement provisions that apply during and after the term of employment.

Asset Purchase Agreement provides that during the time of employment of Mr.

Lee and two years after, Mr.

Lee and the Sellers will be subject

to non-competition and non-solicitation provisions.

The Company will also provide standard indemnification and directors’ and officers’

The Asset Purchase Agreement also contains mutual indemnification provisions with respect to breaches of representations and

warranties as well as to certain third-party claims, and indemnification by the Company of the Sellers and Mr.

Lee with respect to certain

damages with respect to the assumed liabilities and certain other liabilities asserted by a third party arising after November 10, 2023.

In the case of indemnification provided with respect to breaches of certain non-fundamental representations and warranties, the indemnifying

party will only become liable for indemnified losses to the extent that the amount exceeds an aggregate threshold of $25,000.

this threshold limitation does not apply to claims by the Company for breaches by the Sellers or Mr.

Lee of certain fundamental representations

and warranties.

In addition, the Company’s aggregate remedy with respect to any and all indemnifiable losses may in no event exceed

the purchase price of $100,000 in cash and 60,000 shares of Class B Common Stock.

● On February 22, 2024, the Company entered into a Cancellation and Exchange Agreement with each of AEH,

the holder of 1,677,055 shares of Class A Common Stock, GKDB AE Holdings, LLC, a Texas limited liability company (“GKDB”),

the holder of 603,953 units of membership interests in AEH representing approximately 13.2% ownership of AEH, and certain holders of an

aggregate of 308,073 units of membership interests in GKDB (the “2024 Former GKDB Holders”), representing approximately 51.0%

ownership in GKDB.

In accordance with these agreements, we and AEH agreed to convert 112,317 shares of AEH’s Class A Common Stock

into 112,317 shares of Class B Common Stock and transfer such shares to GKDB, in exchange for GKDB’s agreement to cancel and surrender

308,073 of GKDB’s 603,953 units of membership interests in AEH, representing the 2024 Former GKDB Holders’ approximately 51.0%

share of GKDB’s total ownership interest in AEH.

GKDB in turn agreed to the cancellation

of 79,000 of its AEH units and transfer of the 770,724 shares of Class B Common Stock to

the 2022 Former GKDB Holders in proportion to their former ownership interests in GKDB, in

exchange for the 2022 Former GKDB Holders’ agreement to cancel and surrender all of

their units of membership interests in GKDB.

The 770,724 shares of Class B Common Stock transferred

to the 2022 Former GKDB Holders were derived from the 2022 Former GKDB Holders’ approximately

7.9% nominal indirect interest in AEH’s 9,756,000 shares of Class A Common Stock, which

in turn was derived from the 2022 Former GKDB Holders’ 39.5% ownership of GKDB and,

in turn, their nominal indirect interest in 79,000 of GKDB’s 200,000 units, or 20.0%

ownership of AEH.

GKDB in turn agreed to the cancellation of 308,073 of its AEH units and transfer

of the 112,317 shares of Class B Common Stock to the 2024 Former GKDB Holders in proportion to their former ownership interests in GKDB,

in exchange for the 2024 Former GKDB Holders’ agreement to cancel and surrender all of their units of membership interests in GKDB.

The 112,317 shares of Class B Common Stock transferred to the 2024 Former GKDB Holders were derived from the 2024 Former GKDB Holders’

approximately 6.7% nominal indirect interest in AEH’s 1,677,055 shares of Class A Common Stock, which in turn was derived from the

2024 Former GKDB Holders’ approximately 51.0% ownership of GKDB and, in turn, their nominal indirect interest in 308,073 of GKDB’s

603,953 units, or approximately 13.2% ownership of AEH.

The 2024 Former GKDB Holders’ nominal indirect interest in AEH’s 1,677,055

9,756,000 shares of Class A Common Stock was therefore automatically converted into ownership

of 770,724 shares of Class B Common Stock upon the conversion and transfer of this number

of Class A Common Stock that were held by AEH to the 2022 Former GKDB Holders.

of these transactions, AEH held 8,985,276 shares of Class A Common Stock and the 2022 Former

GKDB Holders held a total of 770,724 shares of Class B Common Stock.

GTMC, LLC, a Texas limited

liability company (“GTMC”), one of the 2022 Former GKDB Holders, whose manager

was Carla Woodcock, acquired 292,680 shares of Class B Common Stock, or 28.8% of the issued

and outstanding shares of Class B Common Stock prior to subsequent issuances of Class B Common

KD Holdings Group, LLC, a Wyoming limited liability company (“KD Holdings”),

one of the 2022 Former GKDB Holders, whose manager was Robyn Baker, acquired 292,680 shares

of Class B Common Stock, or 28.8% of the issued and outstanding shares of Class B Common

Stock prior to subsequent issuances of Class B Common Stock;

and Trojan Partners, LP, a Delaware

limited partnership (“Trojan Partners”), one of the 2022 Former GKDB Holders,

whose general partner and officer was Jim Riggs, acquired 146,340 shares of Class B Common

Stock, or 14.4% of the issued and outstanding shares of Class B Common Stock prior to subsequent

issuances of Class B Common Stock.

Based on total stockholders’ equity of the Company

of $113,723 as of June 30, 2022, and the percentage of the total issued and outstanding shares

of common stock of the Company that was converted and transferred, the total approximate

dollar value of these transactions was $8,765.

Based on this transactional value, the percentage

of the total shares of common stock of the Company that were converted and transferred in

these transactions, and the percentage of each party or beneficiary’s beneficial ownership

in such shares immediately prior to or as a result of these transactions, the approximate

dollar value of the interest of AEH and each of its beneficial owners in these transactions

the approximate dollar value of the interest of each of GTMC and Carla Woodcock

in these transactions was $3,328;

the approximate dollar value of the interest of each of

KD Holdings and Robyn Baker in these transactions was $3,328;

and the approximate dollar

value of the interest of each of Trojan Partners and Jim Riggs in these transactions was

● On June 9, 2022, October 7, 2022,

and October 21, 2022, we conducted private placements of shares of Class B Common Stock and

entered into certain subscription agreements with a number of investors.

Pursuant to the

agreements, we issued 750,000 shares of Class B Common Stock at $1.00 per share for a total

The shares were subject to certain lockup provisions until 365 days after the

commencement of trading of our Class B Common Stock, subject to certain exceptions.

these lockup provisions were fully waived.

If the Company’s common stock had not been

listed on a national securities exchange on or before the first anniversary of the final

closing of the private placement, then all of the private placement investors would have

been entitled to receive one additional share for each share originally purchased.

the representative of the underwriters in our initial public offering, acted as placement

agent in each private placement.

Pursuant to the Boustead Engagement Letter, in addition

to payments of a success fee of $52,500, or 7% of the total purchase price of the shares

sold in the private placements, and a non-accountable expense allowance of $7,500, or 1%

of the total purchase price of the shares sold in the private placement, we agreed to issue

Boustead five-year warrants to purchase up to 52,500 shares of Class B Common Stock in aggregate,

exercisable on a cashless basis, with an exercise price of $6.25 per share, subject to adjustment.

“ Business – Corporate Structure and History – Private Placements

of Class B Common Stock ” for a description of additional terms of the warrants.

“ Management’s Discussion and Analysis of Financial Condition –

Liquidity and Capital Resources – Engagement Letter with Boustead Securities, LLC ”

for a description of related terms of the Boustead Engagement Letter.

As a result of these private placements,

the following transactions resulted in the following acquisitions of shares of Class B Common Stock from the Company:

In a private placement

on June 9, 2022, each of Eternal Horizon International Company Limited, a company organized under the laws of Hong Kong, of which Jie

Xu is Director and has beneficial ownership over its shares, and Gilbert Lam, an individual, acquired 100,000 shares of Class B Common

Stock from the Company, or 7.9% of the issued and outstanding shares of Class B Common Stock prior to subsequent issuances of Class B

Common Stock, for a payment of $100,000 to the Company.

In a private placement on October 21, 2022, Chris Etherington, an individual,

acquired 25,000 shares of Class B Common Stock for a payment of $25,000 to the Company, which, together with 150,000 other shares of

Class B Common Stock beneficially owned by Chris Etherington indirectly as Managing Member of Oleta Investments, LLC, a Nevada limited

liability company, equaled 7.4% of the issued and outstanding shares of Class B Common Stock;

and Vertical Holdings, LLC, of which Kevan

Casey is Managing Member and has beneficial ownership over its shares, acquired 125,000 shares of Class B Common Stock, or 5.3% of the

issued and outstanding shares of Class B Common Stock, for a payment of $125,000 to the Company.

Each of the above payments equals the

approximate dollar value of the respective transaction and the approximate dollar value of the interest of each investor and the respective

beneficial owner of such investor listed above, as applicable, in such transaction.

Derek Dunlop, our Chief Experience Officer, received total annual compensation from the Company of $785,3111 in 2023, consisting of salary payments totaling $206,250, a bonus payment of $10,000, a grant of 225,500 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each of shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date with an aggregate grant date fair value of $547,965 computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report, and $21,096 in other compensation consisting of consulting fees and health insurance.

Dunlop received $104,316 in 2022 under a consulting arrangement.

● Matthew Krueger, our Chief Financial Officer, Treasurer, and Secretary,

received total annual compensation from the Company of $693,486 in 2023, consisting of salary payments totaling $180,000, a bonus payment

of $25,000, a grant of 198,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares

on each of the first three anniversaries of the grant date with an aggregate grant date fair value of $481,140 computed in accordance

with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s financial statements beginning on page F-1

of this Annual Report, and $7,346 in other compensation consisting of health insurance.

Kreuger received $25,500 in 2022 under a consulting

● Arman Sarkhani, our Chief Operating Officer, received total annual

compensation from the Company of $546,769 in 2023, consisting of salary payments totaling $133,333, a bonus payment of $10,000, a grant

of 163,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted shares on each of the

first three anniversaries of the grant date with an aggregate grant date fair value of $396,090 computed in accordance with FASB ASC Topic

shares of Class A Common Stock was therefore automatically converted into ownership of 112,317 shares of Class B Common Stock upon the

conversion and transfer of this number of Class A Common Stock that were held by AEH to the 2024 Former GKDB Holders.

Additionally, on

February 22, 2024, we entered into a Cancellation and Exchange Agreement with AEH and a holder of 160,000 units of membership interests

in AEH (the “2024 Former AEH Holder”), representing approximately 3.4% ownership in AEH.

In accordance with this agreement,

we and AEH agreed to convert 58,332 shares of AEH’s Class A Common Stock into 58,332 shares of Class B Common Stock and transfer

such shares to the 2024 Former AEH Holder in exchange for the 2024 Former AEH Holder’s agreement to cancel and surrender the 2024

Former AEH Holder’s 160,000 units of membership interests in AEH.

The 2024 Former AEH Holder’s nominal direct interest in

AEH’s 1,677,055 shares of Class A Common Stock was therefore automatically converted into ownership of 58,332 shares of Class B

Common Stock upon the conversion and transfer of this number of Class A Common Stock that were held by AEH to the 2024 Former AEH Holder.

These share transfers were recorded with the transfer agent as of February 26, 2024.

As a result of these transactions, AEH held 1,506,406

shares of Class A Common Stock, the 2024 Former GKDB Holders held a total of 112,317 shares of Class B Common Stock, and the 2024 Former

AEH Holder held 58,332 shares of Class B Common Stock.

Based on the closing price per share of $2.43 for the Company’s Class B Common

Stock on February 22, 2024, the total approximate dollar value of these transactions was $414,678;

the approximate dollar value of the

interest of Atticus Peppas in these transactions was $141,748;

the approximate dollar value of the interest of Aaron Edwards in these

transactions was $47,414;

the approximate dollar value of the interest of Brian Fox in these transactions was $47,414;

the approximate

dollar value of the interest of Derek Dunlop in these transactions was $59,567;

the approximate dollar value of the interest of Haeley

Benavides in these transactions was $71,121;

and the approximate dollar value of the interest of John Costacos in these transactions was

● Matthew Krueger, the Company’s Chief Financial Officer, Treasurer, and Secretary, received total

annual compensation from the Company of $220,163 in 2024, consisting of salary payments totaling $180,000, a cash bonus of $25,000, a

grant of 5,000 shares of Class B Common Stock with an aggregate grant date fair value of $2,329 computed in accordance with FASB ASC Topic

718 based on the assumptions described in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report,

and $12,864 in other compensation consisting of health insurance.

Sarkhani received annual compensation from the Company of $42,500

in 2022 under a consulting arrangement.

● Jackson Fairbanks, our Director of Socials and former Chief Marketing

Officer, received total annual compensation from the Company of $538,436 in 2023, consisting of salary payments totaling $125,000, a bonus

payment of $10,000, a grant of 163,000 shares of Class B Common Stock subject to vesting as to approximately one-third of the total granted

shares on each of the first three anniversaries of the grant date with an aggregate grant date fair value of $396,090 computed in accordance

with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s financial statements beginning on page F-1

of this Annual Report, and $7,346 in other compensation consisting of health insurance.

Fairbanks received $42,500 in 2022 under a

consulting arrangement.

● Jason Lee, our Chief Technology Officer, our Chief Technology Officer,

received total annual compensation from the Company of $77,459 in 2023, consisting of salary payments totaling $12,500, a grant of 177,000

shares of Class B Common Stock subject to vesting as one-fourth of the total granted shares on each of the first four six-month anniversaries

of the grant date with an aggregate grant date fair value of $64,959 computed in accordance with FASB ASC Topic 718 based on the assumptions

described in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report.

● On February 22, 2024, we entered

into a Cancellation and Exchange Agreement with each of AEH, the holder of 8,385,276 shares

of Class A Common Stock, GKDB, the holder of 603,953 units of membership interests in AEH

representing approximately 13.2% ownership of AEH, and the 2024 Former GKDB Holders, the

holders of an aggregate of 308,073 units of membership interests in GKDB representing approximately

51.0% ownership in GKDB.

In accordance with these agreements, we and AEH agreed to convert

561,585 shares of AEH’s Class A Common Stock into 561,585 shares of Class B Common

Stock and transfer such shares to GKDB, in exchange for GKDB’s agreement to cancel

and surrender 308,073 of GKDB’s 603,953 units of membership interests in AEH, representing

the 2024 Former GKDB Holders’ approximately 51.0% share of GKDB’s total ownership

interest in AEH.

GKDB in turn agreed to the cancellation of 308,073 of its AEH units and

transfer of the 561,585 shares of Class B Common Stock to the 2024 Former GKDB Holders in

proportion to their former ownership interests in GKDB, in exchange for the 2024 Former GKDB

Holders’ agreement to cancel and surrender all of their units of membership interests

The 561,585 shares of Class B Common Stock transferred to the 2024 Former GKDB Holders

were derived from the 2024 Former GKDB Holders’ approximately 6.7% nominal indirect

interest in AEH’s 8,385,276 shares of Class A Common Stock, which in turn was derived

from the 2024 Former GKDB Holders’ approximately 51.0% ownership of GKDB and, in turn,

their nominal indirect interest in 308,073 of GKDB’s 603,953 units, or approximately

13.2% ownership of AEH.

The 2024 Former GKDB Holders’ nominal indirect interest in

AEH’s 8,385,276 shares of Class A Common Stock was therefore automatically converted

into ownership of 561,585 shares of Class B Common Stock upon the conversion and transfer

of this number of Class A Common Stock that were held by AEH to the 2024 Former GKDB Holders.

Additionally, on February 22, 2024, we entered into a Cancellation and Exchange Agreement

with AEH and a holder of 160,000 units of membership interests in AEH (the “2024 Former

AEH Holder”), representing approximately 3.4% ownership in AEH.

In accordance with

this agreement, we and AEH agreed to convert 291,662 shares of AEH’s Class A Common

Stock into 291,662 shares of Class B Common Stock and transfer such shares to the 2024 Former

AEH Holder in exchange for the 2024 Former AEH Holder’s agreement to cancel and surrender

the 2024 Former AEH Holder’s 160,000 units of membership interests in AEH.

Former AEH Holder’s nominal direct interest in AEH’s 8,385,276 shares of Class

A Common Stock was therefore automatically converted into ownership of 291,662 shares of

Class B Common Stock upon the conversion and transfer of this number of Class A Common Stock

that were held by AEH to the 2024 Former AEH Holder.

These share transfers were recorded

with the transfer agent as of February 26, 2024.

As a result of these transactions, AEH held

7,532,029 shares of Class A Common Stock, the 2024 Former GKDB Holders held a total of 561,585

shares of Class B Common Stock, and the 2024 Former AEH Holder held 291,662 shares of Class

B Common Stock.

Based on the closing price per share of $0.486 for the Company’s Class

B Common Stock on February 22, 2024, the total approximate dollar value of these transactions

was $414,678;

the approximate dollar value of the interest of Atticus Peppas in these transactions

was $141,748;

the approximate dollar value of the interest of Aaron Edwards in these transactions

the approximate dollar value of the interest of Brian Fox in these transactions

the approximate dollar value of the interest of Derek Dunlop in these transactions

the approximate dollar value of the interest of Haeley Benavides in these transactions

and the approximate dollar value of the interest of John Costacos in these transactions

● Certain of the Company’s directors,

executive officers, and principal owners, including immediate family members, are users of

the Company’s services.

Fees charged to these users are on terms no more favorable

than terms generally available to an unaffiliated third party under the same or similar circumstances.

Krueger received total annual compensation from the Company of $693,486

in 2023, consisting of salary payments totaling $180,000, a bonus payment of $25,000, a grant of 39,600 shares of Class B Common Stock

subject to vesting as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date

with an aggregate grant date fair value of $481,140 computed in accordance with FASB ASC Topic 718 based on the assumptions described

in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report, and $7,346 in other compensation consisting

of health insurance.

● Arman Sarkhani, the Company’s Chief Operating Officer, received total annual compensation from the

Company of $192,461 in 2024, consisting of salary payments totaling $150,000, a cash bonus of $25,000, a grant of 10,000 shares of Class

B Common Stock with an aggregate grant date fair value of $4,597 computed in accordance with FASB ASC Topic 718 based on the assumptions

described in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report, and $12,864 in other compensation

consisting of health insurance.

Sarkhani received total annual compensation from the Company of $546,769 in 2023, consisting of salary

payments totaling $133,333, a bonus payment of $10,000, a grant of 32,600 shares of Class B Common Stock subject to vesting as to approximately

one-third of the total granted shares on each of the first three anniversaries of the grant date with an aggregate grant date fair value

of $396,090 computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s financial

statements beginning on page F-1 of this Annual Report, and $7,346 in other compensation consisting of health insurance.

● On March 27, 2025, the Company entered into a letter agreement

between the Company and Arman Sarkhani, the Company’s Chief Operating Officer, dated as of March 27, 2025 (the “New Arman

Sarkhani Agreement”).

Under the New Arman Sarkhani Agreement, Mr.

Sarkhani will remain employed by the Company for a term that

will begin on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its terms or extended by mutual

written agreement.

For the period beginning on the day following the date of the termination of the Prior Arman Sarkhani Employment Agreement

and ending on April 1, 2027, the Company will pay Mr.

Sarkhani an annual salary of $150,000.

Pursuant to the New Arman Sarkhani Agreement,

the Company will also pay Mr.

Sarkhani a cash bonus of $10,000 on April 1, 2025.

Sarkhani will also be eligible to receive an annual

cash bonus as determined by the board or the Compensation Committee.

Subject to the approval by the Company’s stockholders

of an amendment to the Plan to increase the number of shares of Class B Common Stock available for grant under the Plan, and further

subject to the approval of the board or the Compensation Committee, Mr.

Sarkhani will be granted an award of shares of Class B Common

Stock under the Plan in an amount to be determined by the board or the Compensation Committee pursuant to a restricted stock award agreement

(the “Arman Sarkhani Award Agreement”).

The shares will vest equally over two years on each anniversary of the Arman Sarkhani

Award Agreement subject to Mr.

Sarkhani’s continuous service.

Upon a change of control of the Company, all of the shares will vest

The Arman Sarkhani Award Agreement will also contain non-competition and non-solicitation provisions.

Under the New Arman

Sarkhani Agreement, Mr.

Sarkhani will be eligible to participate in standard benefits plans offered to similarly-situated employees by

the Company from time to time, subject to plan terms and generally applicable Company policies.

The New Arman Sarkhani Agreement also

contains certain confidentiality provisions.

The Company may terminate Mr.

Sarkhani for “cause” as defined in the New Arman

Sarkhani Agreement.

If the Company terminates Mr.

Sarkhani without cause, the Company will be required to pay Mr.

Sarkhani a separation

fee of $150,000.

● Jason Lee, the Company’s Chief Technology Officer, received total annual compensation from the Company

of $116,667 in 2024, consisting of salary payments totaling $116,667.

Lee received total annual compensation from the Company of $77,459

in 2023, consisting of salary payments totaling $12,500 and a grant of 35,400 shares of Class B Common Stock subject to vesting as to

one-fourth of the total granted shares on each of the first four six-month anniversaries of the grant date with an aggregate grant date

fair value of $64,959 computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s

financial statements beginning on page F-1 of this Annual Report.

● Under the letter agreement between the Company and Jackson

Fairbanks, the Company’s Director of Socials and former Chief Marketing Officer, and a beneficial owner of more than 5% of our

Class B Common Stock, dated as of April 21, 2022 (the “Prior Jackson Fairbanks Agreement”), the term of the Prior Jackson

Fairbanks Agreement commenced as of the closing of the initial public offering on February 7, 2023, and terminated on February 7, 2025

in accordance with its terms.

During the term of the Prior Jackson Fairbanks Agreement, the Company paid Mr.

Fairbanks an annual salary

of $125,000 and an initial cash bonus of $10,000.

Fairbanks was eligible to receive an annual cash bonus as determined by the Company’s

board of directors.

Pursuant to the Prior Jackson Fairbanks Agreement, following the closing of the initial public offering, on February

7, 2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Fairbanks granting restricted stock

under the Plan in the amount of 163,000 shares of Class B Common Stock to vest equally over three years on each anniversary of the agreement.

Upon a change of control of the Company, all of the shares will vest immediately.

Under the Prior Jackson Fairbanks Agreement, Mr.

will be eligible to participate in standard benefits plans offered to similarly-situated employees by the Company from time to time,

subject to plan terms and generally applicable Company policies.

The Prior Jackson Fairbanks Agreement also contained certain confidentiality

● Jackson Fairbanks, the Company’s Director of Socials

and former Chief Marketing Officer, and a beneficial owner of more than 5% of our Class B Common Stock, received total annual compensation

from the Company of $142,461 in 2024, consisting of salary payments totaling $125,000, a grant of 10,000 shares of Class B Common Stock

with an aggregate grant date fair value of $4,658 computed in accordance with FASB ASC Topic 718 based on the assumptions described in

Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report, and $12,864 in other compensation consisting

of health insurance.

Fairbanks received total annual compensation from the Company of $538,436 in 2023, consisting of salary payments

totaling $125,000, a bonus payment of $10,000, a grant of 32,600 shares of Class B Common Stock subject to vesting as to approximately

one-third of the total granted shares on each of the first three anniversaries of the grant date with an aggregate grant date fair value

of $396,090 computed in accordance with FASB ASC Topic 718 based on the assumptions described in Note 2 to the Company’s financial

statements beginning on page F-1 of this Annual Report, and $7,346 in other compensation consisting of health insurance.

● On March 27, 2025, the Company entered into a letter agreement,

dated as of March 27, 2025, between the Company and Jackson Fairbanks, the Company’s Director of Socials and former Chief Marketing

Officer, and a beneficial owner of more than 5% of our Class B Common Stock (the “New Jackson Fairbanks Agreement”).

the New Jackson Fairbanks Agreement, Mr.

Fairbanks will remain employed by the Company for a term that will begin on April 1, 2025 and

will end on April 1, 2027 unless terminated earlier in accordance with its terms or extended by mutual written agreement.

For the period

beginning on the day following the date of the termination of the Prior Jackson Fairbanks Agreement, and ending on April 1, 2027, the

Company will pay Mr.

Fairbanks an annual salary of $125,000.

Pursuant to the New Jackson Fairbanks Agreement, the Company will also pay

Fairbanks a cash bonus of $10,000 on April 1, 2025.

Fairbanks will also be eligible to receive an annual cash bonus as determined

by the board or the Compensation Committee.

Subject to the approval by the Company’s stockholders of an amendment to the

Plan to increase the number of shares of Class B Common Stock available for grant under the Plan, and further subject to the approval

of the board or the Compensation Committee, Mr.

Fairbanks will be granted an award of shares of Class B Common Stock under the Plan in

an amount to be determined by the board or the Compensation Committee pursuant to a restricted stock award agreement (the “Fairbanks

Award Agreement”).

The shares will vest equally over two years on each anniversary of the Fairbanks Award Agreement subject to

Fairbanks’s continuous service.

Upon a change of control of the Company, all of the shares will vest immediately.

The Fairbanks

Award Agreement will also contain non-competition and non-solicitation provisions.

Under the New Jackson Fairbanks Agreement, Mr.

will be eligible to participate in standard benefits plans offered to similarly-situated employees by the Company from time to time,

subject to plan terms and generally applicable Company policies.

The New Jackson Fairbanks Agreement also contains certain confidentiality

The Company may terminate Mr.

Fairbanks for “cause” as defined in the New Jackson Fairbanks Agreement.

Company terminates Mr.

Krueger without cause, the Company will be required to pay Mr.

Fairbanks a separation fee of $125,000.

● Under the letter agreement between the Company and Derek

Dunlop, the Company’s former Chief Experience Officer, dated as of April 21, 2022 (the “Dunlop Agreement”), the term

of the Dunlop Agreement commenced as of the closing of the initial public offering on February 7, 2023, and had a term of two years unless

terminated earlier in accordance with its terms.

During the term of the Dunlop Agreement, the Company was required to pay Mr.

an annual salary of $220,000 and an initial cash bonus of $10,000.

Dunlop was eligible to receive an annual cash bonus as determined

by the Company’s board of directors.

Pursuant to the Dunlop Agreement, following the closing of the initial public offering, on

February 7, 2023, the Company entered into its standard form of restricted stock award agreement with Mr.

Dunlop granting restricted

stock under the Plan in the amount of 45,100 shares of Class B Common Stock subject to vesting as to approximately one-third of the total

granted shares on each of the first three anniversaries of the grant date.

Under the Dunlop Agreement, Mr.

Dunlop was eligible to participate

in standard benefits plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally

applicable Company policies.

The Dunlop Agreement also contained certain confidentiality provisions.

On September 30, 2024, Mr.

employment was terminated by the Company.

● Derek Dunlop, the Company’s former Chief Experience

Officer, received total annual compensation from the Company of $165,000 in 2024, consisting of salary payments totaling $165,000, and

$11,884 in other compensation consisting of health insurance.

Dunlop received total annual compensation from the Company of $785,311

in 2023, consisting of salary payments totaling $206,250, a bonus payment of $10,000, a grant of 45,100 shares of Class B Common Stock

subject to vesting as to approximately one-third of the total granted shares on each of the first three anniversaries of the grant date

with an aggregate grant date fair value of $547,965 computed in accordance with FASB ASC Topic 718 based on the assumptions described

in Note 2 to the Company’s financial statements beginning on page F-1 of this Annual Report, and $21,096 in other compensation

consisting of consulting fees and health insurance.

● The information under Item 9B.

“ Other Information

– New Executive Employment and Consulting Agreements ” is incorporated by reference herein.

Promoters and Certain Control Persons

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Committees of the Board of Directors

Our board of directors has established an audit

committee, a compensation committee, and a nominating and corporate governance committee, each with its own charter approved by the board.

Each committee’s charter is available on our website at https://assetentities.com/.

In addition, our board of directors may, from

time to time, designate one or more additional committees, which shall have the duties and powers granted to it by the board.

Audit Committee

Brian Regli, Richard Burton, and Scott McDonald,

each of whom satisfies the “independence” requirements of Rule 10A-3 under the Exchange Act and Nasdaq’s rules,

serve on our audit committee, with Mr.

Regli serving as the chairman.

Compensation Committee

Richard Burton, John A.

Jack II, and Brian Regli,

each of whom satisfies the “independence” requirements of Rule 10C-1 under the Exchange Act and Nasdaq’s rules,

serve on our compensation committee, with Mr.

Burton, John A.

Jack II, and Scott

McDonald, each of whom has been determined by the board of directors to satisfy the “independence” requirements of Rule 10A-3

under the Exchange Act and Nasdaq’s rules, serve on the Audit Committee, with Mr.

Burton serving as the chairman.

The members of the compensation committee are also “non-employee

directors” within the meaning of Section 16 of the Exchange Act.

Our board has

determined that Mr.

Burton qualifies as an “audit committee financial expert” as defined by Item 407(d)(5) of Regulation S-K

promulgated by the SEC.

The Audit Committee oversees our accounting and financial reporting processes and the audits of the financial

statements of the Company.

Compensation Committee

Burton, John A.

Jack II, and Scott

McDonald, each of whom satisfies the “independence” requirements of Rule 10C-1 under the Exchange Act and Nasdaq’s

rules, serve on the Compensation Committee, with Mr.

Jack serving as the chairman.

The members of the compensation committee are also

“non-employee directors” within the meaning of Section 16 of the Exchange Act.

The Compensation Committee assists the board

in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers.

Nominating and Corporate Governance Committee

Jack II, Scott McDonald, and Richard

Jack II, Scott McDonald, and Richard A.

Burton, each of whom satisfies the “independence” requirements of Nasdaq’s rules, serve on our nominating and corporate

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McDonald serving as the chairman.

The Nominating and Corporate Governance Committee assists the board of

directors in selecting individuals qualified to become our directors and in determining the composition of the board and its committees.

PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Independent Auditors’ Fees

The aggregate fees billed to the Company by the

Company’s principal accountant for the indicated services for each of the last two fiscal years were as follows:

The aggregate fees billed to the Company by the Company’s principal

accountant for the indicated services for each of the last two fiscal years were as follows:

Audit-Related Fees

All Other Fees

As used in the table above, the following terms

have the meanings set forth below.

Audit fees consist of aggregate

fees billed for each of the last two fiscal years for professional services performed by the Company’s principal accountant for

the audit of the financial statements included in this Annual Report and review of the financial statements included in our quarterly

Form 10-Q filings, reviews of registration statements and issuances of consents, and services that are normally provided in connection

with statutory and regulatory filings or engagements.

Audit-Related Fees

As used in the table above, the following terms have the meanings set

Audit fees consist of aggregate fees billed for

each of the last two fiscal years for professional services performed by the Company’s principal accountant for the audit of the

financial statements included in our Annual Reports on Form 10-Q and review of the financial statements included in our Quarterly Reports

on Form 10-Q, reviews of registration statements and issuances of consents, and services that are normally provided in connection with

statutory and regulatory filings or engagements.

Audit-Related Fees

consist of aggregate fees billed for each of the last two fiscal years for assurance and related services performed by the Company’s

principal accountant that are reasonably related to the performance of the audit or review of our financial

statements and are not reported under the paragraph captioned “Audit-Fees” above.

We did not engage our principal accountant

to provide assurance or related services during the last two fiscal years.

Tax fees consist of aggregate fees billed for

each of the last two fiscal years for professional services performed by the Company’s principal accountant with respect to tax

compliance, tax advice, tax consulting and tax planning.

We did not engage our principal accountant to provide tax compliance, tax advice

or tax planning services during the last two fiscal years.

Audit-related fees consist of aggregate fees billed for each of the

last two fiscal years for assurance and related services performed by the Company’s principal accountant that are reasonably related

to the performance of the audit or review of our financial statements and are not reported under the paragraph captioned “Audit

We did not engage our principal accountant to provide assurance or related services during the last two fiscal years.

Tax fees consist of aggregate fees billed for each of the last two

fiscal years for professional services performed by the Company’s principal accountant with respect to tax compliance, tax advice,

tax consulting and tax planning.

We did not engage our principal accountant to provide tax compliance, tax advice or tax planning services

during the last two fiscal years.

All Other Fees

All other fees consist of aggregate fees billed

for each of the last two fiscal years for products and services provided by the Company’s principal accountant, other than for

the services reported under the headings “ Audit Fees ,” “ Audit-Related Fees ” and “ Tax Fees ”

We did not engage our principal accountant to render services to us during the last two fiscal years, other than as reported above.

All other fees consist of aggregate fees billed for each of the last

two fiscal years for products and services provided by the Company’s principal accountant, other than for the services reported

under the headings “ Audit Fees ,” “ Audit-Related Fees ” and “ Tax Fees ” above.

did not engage our principal accountant to render services to us during the last two fiscal years, other than as reported above.

Pre-Approval Policies and Procedures

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non-audit services provided.

The Audit Committee has concluded that the fees earned by the principal accountant were consistent with

the maintenance of the principal accountant’s independence in the conduct of its auditing functions.

The Company’s principal accountant did

not provide, and the Audit Committee did not approve, any of the services described under “ —Audit-Related Fees ”,

or “ —Tax Fees ” or “ —All Other Fees ” above for either of the last two fiscal years.

The Audit Committee has concluded that the fees earned by the principal accountant were consistent with the

maintenance of the principal accountant’s independence in the conduct of its auditing functions.

The Company’s

principal accountant did not provide, and the Audit Committee did not approve, any services that would have been described under “ —Audit-Related

Fees ”, or “ —Tax Fees ” or “ —All Other Fees ” above for either of the last two

fiscal years.

The Audit Committee annually considers the provision

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the full Audit Committee at its next regular meeting.

The percentage of hours expended on the Company’s

principal accountant’s engagement to audit the Company’s financial statements for the most recent fiscal year that were attributed

to work performed by persons other than the principal accountant’s full-time, permanent employees was not greater than 50%.

The percentage

of hours expended on the Company’s principal accountant’s engagement to audit the Company’s financial statements for

the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time,

permanent employees was not greater than 50%.

EXHIBIT AND FINANCIAL STATEMENT SCHEDULES.

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(b) Exhibits:

Agreement and Plan of Merger, dated as of March 11, 2022, by and between Asset Entities Limited Liability Company and Asset Entities Inc.

(incorporated by reference to Exhibit 2.1 to Registration Statement on Form S-1 filed on September 2, 2022)

Articles of Incorporation of Asset Entities Inc.

(incorporated by reference to Exhibit 3.1 to Registration Statement on Form S-1 filed on September 2, 2022)

Certificate of Designation of Series A Convertible Preferred Stock of Asset Entities Inc.

filed with the Secretary of State of the State of Nevada on May 24, 2024 (incorporated by reference to Exhibit 3.3 to Registration Statement on Form S-1 filed on June 7, 2024)

Certificate of Amendment to Designation of Asset Entities Inc.

filed with the Secretary of State of the State of Nevada on June 14, 2024 (incorporated by reference to Exhibit 3.1 to Current Report on Form 8-K filed on June 20, 2024)

Certificate of Change of Asset Entities Inc.

filed with the Secretary of State of the State of Nevada on June 27, 2024 (incorporated by reference to Exhibit 3.1 to Current Report on Form 8-K filed on June 28, 2024)

Certificate of Amendment to Designation of Series A Convertible Preferred Stock of Asset Entities Inc.

filed with the Secretary of State of the State of Nevada at 9:58 AM Pacific Daylight Time on September 4, 2024 (incorporated by reference to Exhibit 3.6 to Registration Statement on Form S-1 filed on October 31, 2024)

Certificate of Amendment to Designation of Series A Convertible Preferred Stock of Asset Entities Inc.

filed with the Secretary of State of the State of Nevada at 11:38 AM Pacific Daylight Time on September 4, 2024 (incorporated by reference to Exhibit 3.7 to Registration Statement on Form S-1 filed on October 31, 2024)

Bylaws of Asset Entities Inc.

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Form of Pre-Funded Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed on August 7, 2023)

Form of Common Stock Purchase Warrant issuable to Boustead Securities, LLC (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed on August 7, 2023)

Employment Letter Agreement between Asset Entities Inc.

Form of Warrant To Purchase Class B Common Stock issuable to Boustead Securities, LLC (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed on August 7, 2023)

Warrant To Purchase Class B Common Stock issued to Boustead Securities, LLC, dated as of May 24, 2024 (incorporated by reference to Exhibit 4.1 to Form 8-K filed on May 28, 2024)

Warrant To Purchase Class B Common Stock issued to Michael R.

Jacks, dated as of July 29, 2024 (incorporated by reference to Exhibit 4.8 to Registration Statement on Form S-1 filed on filed on August 9, 2024)

Letter Agreement between Asset Entities Inc.

and Arshia Sarkhani, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.1 to Registration Statement on Form S-1 filed on September 2, 2022)

Employment Letter Agreement between Asset Entities Inc.

and Derek Dunlop, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.4 to Registration Statement on Form S-1 filed on September 2, 2022)

Employment Letter Agreement between Asset Entities Inc.

Letter Agreement between Asset Entities Inc.

and Matthew Krueger, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.5 to Registration Statement on Form S-1 filed on September 2, 2022)

Employment Letter Agreement between Asset Entities Inc.

Letter Agreement between Asset Entities Inc.

and Kyle Fairbanks, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.3 to Registration Statement on Form S-1 filed on September 2, 2022)

Employment Letter Agreement between Asset Entities Inc.

Letter Agreement between Asset Entities Inc.

and Arman Sarkhani, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.6 to Registration Statement on Form S-1 filed on September 2, 2022)

Employment Letter Agreement between Asset Entities Inc.

Amendment to Letter Agreement between Arman Sarkhani and Asset Entities Inc., dated as of August 15, 2023 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed on November 14, 2023)

Letter Agreement between Asset Entities Inc.

and Jason Lee, dated as of November 10, 2023 (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed on November 15, 2023)

1 unchanged sentence

and Michael Gaubert, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.2 to Registration Statement on Form S-1 filed on September 2, 2022)

Cancellation and Exchange Agreement, dated as of April 21, 2022, by and among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and Anel Bulbul (incorporated by reference to Exhibit 10.8 to Registration Statement on Form S-1 filed on September 2, 2022)

Cancellation and Exchange Agreement, dated as of April 21, 2022, by and among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and GTMC, LLC (incorporated by reference to Exhibit 10.9 to Registration Statement on Form S-1 filed on September 2, 2022)

Cancellation and Exchange Agreement, dated as of April 21, 2022, by and among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, KD Holdings Group, LLC, and Trojan Partners, LP (incorporated by reference to Exhibit 10.10 to Registration Statement on Form S-1 filed on September 2, 2022)

Independent Director Agreement between Asset Entities Inc.

and Brian Regli, dated May 2, 2022 (incorporated by reference to Exhibit 10.11 to Annual Report on Form 10-K filed on March 31, 2023)

Independent Director Agreement between Asset Entities Inc.

Jack II, dated May 2, 2022 (incorporated by reference to Exhibit 10.12 to Annual Report on Form 10-K filed on March 31, 2023)

4 unchanged sentences

McDonald, dated May 2, 2022 (incorporated by reference to Exhibit 10.14 to Annual Report on Form 10-K filed on March 31, 2023)

Independent Director Agreement between Asset Entities Inc.

and David Reynolds, dated as of May 16, 2024 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on May 16, 2024)

Form of Indemnification Agreement between Asset Entities Inc.

and each officer or director (incorporated by reference to Exhibit 10.12 to Registration Statement on Form S-1 filed on September 2, 2022)

and each officer or director (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed on May 16, 2024)

Asset Entities Inc.

6 unchanged sentences

2022 Equity Incentive Plan (incorporated by reference to Exhibit 10.16 to Registration Statement on Form S-1 filed on September 2, 2022)

Office Agreement between Regus Management Group, LLC and Asset Entities, LLC, dated as of January 25, 2022 (incorporated by reference to Exhibit 10.17 to Registration Statement on Form S-1 filed on September 2, 2022)

Office Agreement between Regus Management Group, LLC and Asset Entities, LLC, dated as of May 4, 2022 (incorporated by reference to Exhibit 10.21 to Annual Report on Form 10-K filed on March 31, 2023)

Renewal Agreement between Regus Management Group, LLC and Asset Entities, LLC, dated as of October 10, 2022 (incorporated by reference to Exhibit 10.22 to Annual Report on Form 10-K filed on March 31, 2023)

Form of Private Placement Subscription Agreement (incorporated by reference to Exhibit 10.18 to Registration Statement on Form S-1 filed on September 2, 2022)

Renewal Service Agreement, dated as of June 9, 2024, between Asset Entities, LLC and Regus Management Group, LLC (incorporated by reference to Exhibit 10.17 to Registration Statement on Form S-1 filed on August 9, 2024)

Renewal Service Agreement, dated as of November 9, 2023, between Asset Entities, LLC and Regus Management Group, LLC (incorporated by reference to Exhibit 10.18 to Registration Statement on Form S-1 filed on August 9, 2024)

Renewal Service Agreement, dated as of October 10, 2023, between Asset Entities, LLC and Regus Management Group, LLC (incorporated by reference to Exhibit 10.19 to Registration Statement on Form S-1 filed on August 9, 2024)

Cancellation and Exchange Agreement, dated as of February 22, 2024, among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and Derek Dunlop (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed on May 15, 2024)

Cancellation and Exchange Agreement, dated as of February 22, 2024, among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and Brian Fox (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed on May 15, 2024)

Cancellation and Exchange Agreement, dated as of February 22, 2024, among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and Haeley Benavides (incorporated by reference to Exhibit 10.4 to Quarterly Report on Form 10-Q filed on May 15, 2024)

Cancellation and Exchange Agreement, dated as of February 22, 2024, among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and John Costacos (incorporated by reference to Exhibit 10.5 to Quarterly Report on Form 10-Q filed on May 15, 2024)

Cancellation and Exchange Agreement, dated as of February 22, 2024, among Asset Entities Inc., Asset Entities Holdings, LLC, GKDB AE Holdings, LLC, and Aaron Edwards (incorporated by reference to Exhibit 10.6 to Quarterly Report on Form 10-Q filed on May 15, 2024)

Cancellation and Exchange Agreement, dated as of February 22, 2024, among Asset Entities Inc., Asset Entities Holdings, LLC, and Atticus Peppas (incorporated by reference to Exhibit 10.7 to Quarterly Report on Form 10-Q filed on May 15, 2024)

Underwriting Agreement, dated February 2, 2022, by and between Asset Entities Inc.

and Boustead Securities, LLC (as representative of the underwriters named therein) (incorporated by reference to Exhibit 1.1 to Current Report on Form 8-K filed on February 8, 2023)

Closing Agreement between Asset Entities Inc.

and Triton Funds LP, dated as of June 30, 2023 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on July 5, 2023)

Amended and Restated Closing Agreement between Asset Entities Inc.

and Triton Funds LP, dated as of August 1, 2023 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on August 7, 2023)

Amendment to Amended and Restated Closing Agreement between Asset Entities Inc.

and Triton Funds LP, dated as of September 27, 2023 (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed on October 3, 2023)

Amendment to Letter Agreement between Arman Sarkhani and Asset Entities

Inc., dated as of August 15, 2023 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed on November 14, 2023)

Asset Purchase Agreement by and among Asset Entities Inc., Ternary Inc., Ternary Developments Inc., OptionsSwing Inc., and Jason Lee, dated as of November 10, 2023 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on November 15, 2023)

Second Amendment to Amended

and Restated Closing Agreement, dated as of December 30, 2023, between Asset Entities Inc.

and Triton Funds LP

Employment Letter Agreement between Asset Entities Inc.

Fairbanks, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.7 to Registration Statement on Form S-1 filed on September

Third Amendment to Amended and Restated Closing Agreement, dated as of March 29, 2024, between Asset Entities Inc.

and Triton Funds LP

and Triton Funds LP (incorporated by reference to Exhibit 10.32 to Annual Report on Form 10-K filed on April 2, 2024)

Form of Securities Purchase Agreement, dated as of May 24, 2024 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on May 28, 2024)

Form of First Amendment to Securities Purchase Agreement, dated as of June 13, 2024 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on June 20, 2024)

Form of Registration Rights Agreement, dated as of May 24, 2024 (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed on May 28, 2024)

Assignment and Assumption Agreement, dated as of July 30, 2024, among Boustead Securities, LLC, Sutter Securities, Inc., and Asset Entities Inc.

(incorporated by reference to Exhibit 10.34 to Registration Statement on Form S-1 filed on August 9, 2024)

Assignment and Assumption Agreement, dated as of July 30, 2024, among Sutter Securities, Inc., Michael R.

Jacks, Boustead Securities, LLC, and Asset Entities Inc.

(incorporated by reference to Exhibit 10.35 to Registration Statement on Form S-1 filed on August 9, 2024)

Waiver and Consent, dated as of September 20, 2024, between Asset Entities Inc.

and Ionic Ventures, LLC (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on September 23, 2024)

Limited Waiver and Consent, dated as of September 26, 2024, between Asset Entities Inc.

and Boustead Securities, LLC (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on September 27, 2024)

Sales Agreement, dated as of September 27, 2024, between Asset Entities Inc.

and A.G.P./Alliance Global Partners (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on September 30, 2024)

Purchase Agreement, dated November 25, 2024, between Asset Entities Inc.

and Jeff Blue (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on December 2, 2024)

Letter Agreement between Asset Entities Inc.

and Jackson Fairbanks, dated as of April 21, 2022 (incorporated by reference to Exhibit 10.7 to Registration Statement on Form S-1 filed on September 2, 2022)

Letter Agreement between Asset Entities Inc.

and Arshia Sarkhani, dated as of March 27, 2025

Letter Agreement between Asset Entities Inc.

and Matthew Krueger, dated as of March 27, 2025

Letter Agreement between Asset Entities Inc.

and Kyle Fairbanks, dated as of March 27, 2025

Letter Agreement between Asset Entities Inc.

and Arman Sarkhani, dated as of March 27, 2025

Letter Agreement between Asset Entities Inc.

and Jackson Fairbanks, dated as of March 27, 2025

Consulting Letter Agreement between Asset Entities Inc.

and Michael Gaubert, dated as of March 27, 2025

Code of Ethics and Business Conduct (incorporated by reference to Exhibit 14.1 to Registration Statement on Form S-1 filed on September 2, 2022)

Asset Entities Inc.

Insider Trading Policy (incorporated by reference to Exhibit 99.1 to Annual Report on Form 10-K filed on April 2, 2024)

Consent of WWC, Professional Corporation

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Asset Entities Inc.

Clawback Policy

Asset Entities Inc.

Insider Trading Policy

Clawback Policy (incorporated by reference to Exhibit 97.1 to Annual Report on Form 10-K filed on April 2, 2024)

Inline XBRL Instance Document

Inline XBRL Taxonomy Extension

Schema Document

Inline XBRL Taxonomy Extension

Calculation Linkbase Document

Inline XBRL Taxonomy Extension

Definition Linkbase Document

Inline XBRL Taxonomy Extension

Label Linkbase Document

Inline XBRL Taxonomy Extension

Presentation Linkbase Document

Cover Page Interactive Data File (formatted as Inline XBRL and contained

in Exhibit 101)

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith

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Report of Independent Registered Public Accounting Firm (PCAOB ID:

Consolidated Balance Sheets F-3

Consolidated Statements of Operations F-4

Consolidated Statements of Changes in Stockholder’s Equity F-5

Consolidated Statements of Cash Flows F-6

Notes to Consolidated Financial Statements F-7

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Balance Sheets

Statements of Operations

Statements of Changes in Stockholder’s Equity

Statements of Cash Flows

Notes to Financial Statements

REPORT OF INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of

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Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of ASSET ENTITIES INC.

and its variable interest entity (collectively the “Company”) as of December 31, 2023

and 2022, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the

two-year period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”).

our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31,

2023 and 2022, and the results of its operations and its cash flows for each of the years in the two-year period December 31, 2023, in

conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying balance sheets

of ASSET ENTITIES INC.

(the “Company”) as of December 31, 2024 and 2023, and the related statements of operations, stockholders’

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

to as the “financial statements”).

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

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

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

Basis for Opinion

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San Mateo, CA

April 1, 2024

March 31, 2025

ASSET ENTITIES INC.

Balance Sheets

As of December 31,

Current Assets

Prepaid expenses

Deferred offering costs

Trading marketable securities

Total Current Assets

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Preferred Stock;

$ 0.0001 par value, 50,000,000 authorized

$ 0.0001 par value, 50,000,000 authorized Series A Convertible Preferred Stock;

$ 0.0001 par value, $ 10,000 stated value , 660 designated 100 and 0 shares issued and outstanding, respectively

Common Stock;

$ 0.0001 par value, 200,000,000 authorized

Class A Common Stock;

$ 0.0001 par value, 10,000,000 authorized 8,385,276 shares issued and outstanding

$ 0.0001 par value, 40,000,000 authorized Class A Common Stock;

$ 0.0001 par value, 2,000,000 authorized 1,000,000 and 1,677,056 shares issued and outstanding, respectively

Class B Common Stock;

$ 0.0001 par value, 38,000,000 authorized 9,060,965 and 1,207,827 shares issued, respectively

Treasury Stock, at cost:

Class B Common Stock - 250,000 and 0 shares, respectively

Additional paid in capital

Treasury Stock, at cost:

Class B Common Stock - 250,000 shares

Subscription receivable

Accumulated deficit

( 12,006,357 )

( 5,558,315 )

TOTAL STOCKHOLDERS’ EQUITY

TOTAL LIABILITIES AND STOCKHOLDERS’

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

The accompanying notes are an integral part

of these consolidated financial statements.

of these financial statements.

ASSET ENTITIES INC.

Statements of Operations

For the years ended

of Operations

Operating expenses

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( 4,931,197 )

Interest income

Total other income

Income before income tax credit

( 6,393,932 )

( 4,931,197 )

Income taxes credit from prior period

$ ( 6,393,932 )

$ ( 4,931,197 )

Dividend on Series A Preferred Stock

Net loss attributable to common stockholders

$ ( 6,448,042 )

$ ( 4,931,197 )

Loss per share of common stock - basic and diluted

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The accompanying notes are an integral part

of these consolidated financial statements.

of these financial statements.

ASSET ENTITIES INC.

Statement of Stockholders’ Equity

Stockholders’ Equity

For the years ended December 31, 2024 and 2023

December 31, 2021

Balance - December 31, 2022

$ ( 627,118 )

from Class A to Class B common stock

Class B Common stock issued

Class B Common stock issued for restricted stock awards

Repurchase of Class B Common stock

( 4,931,197 )

B Common stock issued

December 31, 2022

B Common stock issued

A and B Common stock issued for restricted stock awards

of Class B Common stock

( 4,931,197 )

Balance - December 31,2023

$ ( 176,876 )

December 31, 2023

$ ( 5,558,315 )

Series A Convertible Preferred stock issued

Conversion from Series A Convertible Preferred stock to Class B common

Conversion from Class A to Class B common stock

Class B common stock for cash

Class B Common stock issued for restricted stock awards

Class B Common stock issued for purchase of intangible asset

Cancellation of Class B common stock and Treasury stock

Reverse stock split adjustment

Dividend declared - Series A Convertible Preferred stock

( 6,393,932 )

Balance - December 31,2024

$ ( 12,006,357 )

The accompanying notes are an integral part

of these consolidated financial statements.

ASSET ENTITIES INC.

Statements of Cash Flows

For the years ended

of these financial statements.

ENTITIES INC.

of Cash Flows

CASH FLOWS FROM OPERATING ACTIVITIES

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( 4,900,057 )

( 3,807,623 )

CASH FLOWS FROM INVESTING ACTIVITIES

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CASH FLOWS FROM FINANCING ACTIVITIES

Class A common stock subscription proceeds received

Class B common stock subscription proceeds received, net

Deferred offering costs

Series A Convertible Preferred stock issued

Proceeds from Class B common stock issued, net

Reacquisition of shares

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Net change in cash

Cash at beginning of year

Cash at end of year

Cash at beginning of period

Cash at end of period

SUPPLEMENTAL CASH FLOW INFORMATION:

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Conversion from Class A to Class B common stock

Conversion from Series A Convertible Preferred stock to Class B common stock

Class B Common stock issued for purchase of intangible asset

Cancellation of Class B common stock

Reverse stock split adjustment

The accompanying notes are an integral

part of these consolidated financial statements.

part of these financial statements.

ASSET ENTITIES INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

NOTES TO FINANCIAL

As of and for the years ended December 31, 2024

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Assets Entities Limited Liability Company in the state of California on October 20, 2020.

The consolidated financial statements reflect

the operations of the Company from inception of the general partnership.

On March 15, 2022, the Company filed Articles of Merger to register

and incorporate with the state of Nevada and changed the company name to Asset Entities Inc.

On March 9, 2022, the Company filed Articles of

Incorporation with the state of Nevada to authorize the Company to issue 250,000,000 shares, consisting of 10,000,000 shares of Class

A Common Stock, $ 0.0001 par value per share (“Class A Common”), 190,000,000 shares of Class B Common stock, $ 0.0001 par value

per share (“Class B Common”), and 50,000,000 shares of Preferred Stock, $ 0.0001 par value (the “Preferred Stock”).

On March 28, 2022, all 51,250,000 units of the

previously outstanding membership interests were exchanged for 9,756,000 shares of Class A Common Stock and 244,000 shares of Class B

Common Stock.

The financial statements reflect the operations

of the Company from inception of the general partnership.

On March 15, 2022, the Company filed Articles of Merger to register and incorporate

with the state of Nevada and changed the company name to Asset Entities Inc.

Reverse Stock Split

On June 27, 2024, the Company filed a Certificate

of Change pursuant to Section 78.209 of the Nevada Revised Statutes with the Secretary of State of the State of Nevada authorizing

a 1-for-5 reverse stock split of the Company’s issued and outstanding shares of Class A Common Stock, $ 0.0001 par value per

share, and Class B Common Stock, $ 0.0001 par value per share.

The reverse stock split became effective on July 1, 2024.

Prior to the reverse stock split, the Company

was authorized to issue 200,000,000 shares of common stock, consisting of 10,000,000 shares of Class A Common Stock

and 190,000,000 shares of Class B Common Stock.

As a result of the reverse stock split, the Company will be authorized to 40,000,000 shares

of common stock, consisting of 2,000,000 shares of Class A Common Stock and 38,000,000 shares of Class B Common Stock.

All share and per share information in these financial

statements retroactively reflect this reverse stock split.

Description of Business

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under our “AE.360.DDM” brand.

Our AE.360.DDM service was just released in December 2021.

All of these services – our

Discord investment education and entertainment, social media and marketing, and AE.360.DDM services – are therefore based on our

effective use of Discord in combination with ongoing social media outreach on TikTok, Facebook, Twitter, Instagram, and YouTube.

The Company had an accumulated deficit of $ 5,558,315 at December 31,

2023, $ 2,924,323 in cash at December 31, 2023, and a net loss of $ 4,931,197 during the year ended December 31, 2023.

However, the Company

initiated a sale of 621,590 shares of common stock under its Amended and Restated Closing Agreement on March 27, 2024, and the Company

intends to file a “shelf” registration statement and arrange for one or more financings to commence pursuant to such shelf

registration statement shortly after it becomes effective.

Based on the Company’s existing cash resources and the cash expected

to be received from these financings, it is expected that the Company will have sufficient funds to carry out the Company’s planned

operations through December 31, 2024.

Our AE.360.DDM service was released in December 2021.

All of these services – our Discord

investment education and entertainment, social media and marketing, and AE.360.DDM services – are therefore based on our effective

use of Discord in combination with ongoing social media outreach on TikTok, Facebook, Twitter, Instagram, and YouTube.

The accompanying

financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization

of assets and the liquidation of liabilities in the normal course of business.

The Company has an accumulated deficit of $ 12,006,357 at

December 31, 2024 and a net loss of $ 6,393,932 , during the year ended December 31, 2024.

has received confirmation from Ionic Ventures, LLC that it will invest up to $ 3 million in the Company’s Series A Convertible

Preferred Stock upon request by the Company, and the Company’s Certificate of Designation of Series A Convertible Preferred Stock

allows for an additional 330 preferred shares of Series A Convertible Preferred Stock to be sold.

With the additional revenue from the

purchase of the TommyBoyTV, LLC server in June 2024, gross revenue is projected to increase to over $ 1.2 million in 2025.

Based on the Company’s existing cash resources,

management believes that the Company will have sufficient funds to carry out the Company’s planned operations for at least the next

12 months from the issuance date of the accompanying financial statements.

Summary of Significant Accounting Policies

Basis of Presentation

The consolidated

financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission

The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting

principles in the United States of America (” GAAP”) and are presented in US dollars.

The Company uses the accrual basis of

accounting and has adopted a December 31 fiscal year end.

Consolidation

The consolidated financial statements included

Asset Equity LLC (“Asset Equity”) which is accounted for as a variable interest entity (“VIE”), because the Company

is the primary beneficiary, as a result of the Company’s officers being responsible for 100 % of the operations of Asset Equity,

and the Company derived 100 % of the net profits or losses from Asset Equity’s business operations.

Through common control, the

management of the Company had effective control over Asset Equity and had the power to direct the activities of Asset Equity that most

significantly impact its economic performance.

There were no restrictions on the consolidated VIE’s assets and on the settlement

of its liabilities.

Asset Equity LLC (“Asset Equity”)

was a limited liability company organized in the state of Delaware on February 26, 2021 and dissolved on April 21, 2022.

The co-founders

of the Company, who were the managers of Asset Equity, formed Asset Equity for the purposes of setting up a separate bank account for

revenues derived from the Discord server designated for cryptocurrency education.

All intercompany transactions and balances have been

eliminated on consolidation.

If facts and circumstances change such that the conclusion to consolidate the VIE has changed, the Company

shall disclose the primary factors that caused the change and the effect on the Company’s financial statements in the periods when

the change occurs.

On April 21, 2022, the Company dissolved our VIE,

Asset Equity LLC, and moved all operations to the Company.

The financial

statements and related disclosures have been prepared pursuant to the rules and regulations of the U.S.

Securities and Exchange Commission

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles

in the United States of America (“GAAP”) and are presented in US dollars.

The Company uses the accrual basis of accounting

and has adopted a December 31 fiscal year end.

Use of Estimates

The preparation of consolidated financial statements

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

and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses

during the reporting period.

Some of these judgments can be subjective and complex, and, consequently, actual results may differ from

these estimates.

The preparation of financial statements in conformity

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

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

Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates.

Cash and Cash Equivalents

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these deposits is not significant.

Accounts Receivable

Accounts receivable are recorded in accordance

with ASC 310, “Receivables.” Accounts receivable are recorded at the invoiced amount and do not bear interest.

The Company’s

expected loss allowance methodology for accounts receivable is developed using historical collection experience, current and future economic

and market conditions, and a review of the current status of customers’ trade accounts receivable.

Due to the short-term nature

of such receivables, the estimated accounts receivable that may not be collected is based on aging of the accounts receivable balances.

To measure expected credit losses, accounts receivable are grouped based on shared risk characteristics

and days past due.

The allowance for credit losses is the Company’s best estimate of the amount of probable credit losses

in its existing accounts receivable.

The Company had accounts receivable of $ 0 and $ 5,000 and recorded an allowance for credit losses

of $ 0 and $ 5,000 as of December 31, 2023 and 2022 respectively that is deducted from the amortized cost basis of accounts receivable to

present the net amount expected to be collected.

Deferred Offering Costs

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February 2023, the Company issued common stock as initial public offering and netted offering cost as additional paid in capital.

December 31, 2024, there is no more deferred offering costs.

Property and equipment

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Office Equipment and Fixtures

The Company did not have any Building, Machinery and Equipment, and

Vehicle as of December 31, 2023.

The Company did not have any Building, Machinery

and Equipment, and Vehicle as of December 31, 2024.

Maintenance and repairs are charged to expense

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discount rates.

There were no intangible asset impairment charges in 2023 or 2022.

During the year ended December 31, 2024 and 2023, there were no intangible asset impairment charges.

Finite-lived intangible assets are amortized using

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Fair Value Measurements

The Company uses a

three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well

as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement.

The hierarchy

requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value.

The three tiers are defined as follows:

1—Observable inputs that reflect quoted market prices (unadjusted) for identical assets

or liabilities in active markets;

2—Observable inputs other than quoted prices in active markets that are observable

either directly or indirectly in the marketplace for identical or similar assets and liabilities;

3—Unobservable inputs that are supported by little or no market data, which require

the Company to develop its own assumptions.

The Company uses a three-tier fair value hierarchy

to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured

at fair value on a non-recurring basis, in periods subsequent to their initial measurement.

The hierarchy requires the Company to use

observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value.

The three tiers are defined

Level 1—Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets;

Level 2—Observable inputs other than quoted prices in active markets that are observable either directly or indirectly in the marketplace for identical or similar assets and liabilities;

Level 3—Unobservable inputs that are supported by little or no market data, which require the Company to develop its own assumptions.

The Company’s

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fair values because of the short-term nature of these instruments.

Advertising Expenses

The Company expenses advertising costs as they

Total advertising expenses were $ 944,635 and $ 436,066 for the year ended December 31, 2024 and 2023, respectively, and have

been included as part of general and administrative expenses.

Research and Development

Research and development costs are charged to

expense as incurred.

Accordingly, internal research and development costs are expensed as incurred.

Third-party research and development

costs are expensed when the contracted work has been performed or as milestone results have been achieved as defined under the applicable

The Company incurred research and development

expenses of $ 423,299 and $ 18,935 for the year ended December 31, 2024 and 2023, respectively, and have been included as

part of contract labor.

Stock based compensation

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annual subscription revenue that have not been recognized.

As of December 31, 2023 and 2022, total contract liabilities were $ 3,445 and

$ 4,648 , respectively.

Contract liabilities are expected to be recognized as revenue over a period not to exceed twelve (12) months.

Revenue under these agreements is recognized over the related service period.

As of December 31, 2024 and 2023, total contract liabilities were $ 369 and $ 3,445 respectively.

Contract liabilities are expected

to be recognized as revenue over a period not to exceed twelve (12) months.

Changes in contract liabilities for the year ended

December 31, 2024 are as follows:

Balance, January 1

Deferral of revenue

Recognition of revenue

Balance, December 31

Earnings Per Share of Common Stock

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entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic earnings per share

In the accompanying consolidated financial statements, basic loss per share is computed by dividing net loss by the weighted

average number of shares of common stock outstanding during the year.

Diluted earnings per share is computed by dividing net income by

the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to

reflect the potential dilution that could occur from common stock issuable through contingent share arrangements, stock options and warrants

unless the result would be antidilutive.

The Company would account for the potential dilution from

convertible securities using the as-if converted method.

In the accompanying financial statements, basic loss per share is computed by dividing net loss by the weighted average number

of shares of common stock outstanding during the year.

Diluted earnings per share is computed by dividing net income by the weighted average

number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential

dilution that could occur from common stock issuable through contingent share arrangements, stock options and warrants unless the result

would be antidilutive.

The Company would account for the potential dilution from convertible securities

using the as-if converted method.

The Company accounts for warrants and options using the treasury stock method.

As of December 31, 2023, dilutive potential common shares include outstanding warrants.

As of December

31, 2024, warrants representing 105,490 shares of common stock equivalents were excluded from the computation from diluted net loss per

share as the result was anti-dilutive.

As described in more detail in note 1, the business

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As of December 31, 2024 and 2023, the Company did not have any commitments and contingencies.

Segment Reporting

The Company operates as one operating

The Company's chief operating decision maker ("CODM") is its chief executive officer, who reviews the operating results

for the Company as a whole to make decisions about allocating resources and assessing financial performance.

The CODM uses 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 operating margin, the allocation of budget between

operating expenses and the management and forecasting of cash to ensure enough capital is available.

Accordingly, we determined we operate

in a single reporting segment.

Our CEO assesses performance and decides how to

allocate resources primarily based on consolidated net income, which is reported on our Consolidated Statements of Operations.

on the Consolidated Balance Sheets represent our segment assets.

Recent Accounting Pronouncements

2022, the FASB issued ASU 2022-03, ASC Subtopic “Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities

Subject to Contractual Sale Restrictions”.

These amendments clarify that a contractual restriction on the sale of an equity security

is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

The amendments

in this update are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning

after December 15, 2023.

Early adoption is permitted.

The Company is currently assessing the impact of the adoption of this standard on

its consolidated financial statements.

2024, the FASB issued ASU 2024-03 final standard on Income Statement:

Disaggregation of Income Statement Expenses, which requires disaggregated

disclosure of income statement expenses for public business entities.

The ASU does not change the expense captions an entity presents

on the face of the income statement;

rather, it requires disaggregation of certain expense captions into specified categories in disclosures

within the footnotes to the financial statements.

This guidance will be effective for us on January 1, 2027.

The Company has considered all other recently

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Recently adopted accounting standards

In June 2016, the

FASB issued ASU No.

2016-13, Financial Instruments — Credit Losses (Topic 326) — Measurement of Credit Losses

on Financial Instruments , which has been subsequently amended by ASU No.

2018-19, ASU No.

2019-04, ASU No.

2019-10, ASU No.

2019-11 and ASU No.

2020-03 (“ASU 2016-13”).

The provisions of ASU 2016-13 modify

the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology and require a consideration

of a broader range of reasonable and supportable information to inform credit loss estimates.

The Company adopted ASU 2016-13 on January

1, 2023 using the modified retrospective approach.

The Company’s consolidated financial statements for prior-year periods have not

been revised and are reflective of the credit loss requirements which were in effect for that period.

The adoption of ASU 2016-13 did

not have a material impact on the Company’s consolidated financial statements and related disclosures.

2017, the FASB issued ASU No.

2017-04, Intangibles-Goodwill and Other (Topic 350):

Simplifying the Test for Goodwill Impairment, which

simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test.

Instead of determining a hypothetical

purchase price allocation to measure goodwill impairment, the Company will compare the fair value of a reporting unit with its carrying

The update also includes a new requirement to disclose the amount of goodwill allocated to reporting units with zero or negative

carrying amounts.

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

which improves reportable segment disclosure requirements.

Primarily through enhanced disclosures about significant segment expenses among

other disclosure requirements.

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within

fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The Company adopted ASU 2023-07 on January 1, 2024.

The adoption of ASU 2017-04 did not have a material impact on the

Company’s consolidated financial statements and related disclosures.

The amendments

will be applied retrospectively to all prior periods presented in the accompanying financial statements.

The adoption of ASU 2023-07 has

not had a material effect on the Company’s statements and disclosures.

Property and Equipment

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Accumulated depreciation

During the year ended December 31, 2024 and 2023,

the Company recorded depreciation of $ 2,711 and $ 734 , respectively.

Intangible Assets

Intangible assets consist of the following:

Intangible asset

Purchased software

Discord server

Right of literary work entitled

On November 10, 2023, the Company entered into

an asset purchase agreement (the “Asset Purchase Agreement”).

Under the Asset Purchase Agreement, the Company agreed to purchase

all of the right, title, and interest in and to substantially all of the assets and properties and used in connection with their business

of Discord development, social media, online community management, marketing, and business-to-business software-as-a-service that offers

sales, service, marketing, and analytics for the payment of $ 100,000 in cash (“Purchase software”).

The Company determined

the asset has indefinite useful lived.

On June 21, 2024, the Company entered into an

asset purchase agreement (the “Asset Purchase Agreement”).

Under the Asset Purchase Agreement, the Company agreed to purchase

all of the right, title, and interest in and to substantially all of the assets and properties owned by the Seller and used in connection

with its business of Discord development, social media, online community management, marketing, and analytics for the payment of $ 200,000

in cash and the issuance of 25,000 shares of Class B Common Stock valued at $ 9,500 (“Discord server”).

The Company determined

the asset has indefinite useful lived.

On November 15, 2024, the Company entered into a asset purchase agreement.

Under this agreement, the Company agreed to purchase all of

the right, title, and interest in and to the assets, properties and rights owned by the Seller and used in connection with its business

of Discord development, social media, online community management, marketing, and analytics for the payment of $ 40,000 in cash (“Discord

The Company determined the asset has indefinite useful lived.

On November 25, 2024, the Company entered into

a Purchase Agreement (the "Agreement") with Jeff Blue ("Owner") regarding the literary work entitled "One Step

From Xero to #1:

Becoming Linkin Park" (the "Work").

Under the terms of the Agreement, the Company has acquired

a 50 % ownership interest in the film, TV, streaming, and other media adaptation rights to the Work.

The Agreement stipulates several conditions

precedent, including approval of the chain-of-title to the Work by the Company, and receipt of necessary tax forms and other documents

for payment processing.

In consideration of the rights granted, the Company paid $ 160,000 (“Right of literary work entitled”).

The Company determined the asset has indefinite useful lived.

Stockholders’ Equity

Authorized Capital Stock

On March 9, 2022, the Company filed Articles of

Incorporation with the state of Nevada to authorize the Company to issue 250,000,000 shares, consisting of 10,000,000 shares of Class

A Common Stock, $ 0.0001 par value per share (“Class A Common”), 190,000,000 shares of Class B Common stock, $ 0.0001 par value

per share (“Class B Common”), and 50,000,000 shares of Preferred Stock, $ 0.0001 par value (the “Preferred Stock”).

On March 28, 2022, all 51,250,000 units of the

previously outstanding membership interests were exchanged for 9,756,000 shares of Class A Common Stock and 244,000 shares of Class B

Common Stock.

On June 27, 2024, the Company filed a Certificate

of Change pursuant to Section 78.209 of the Nevada Revised Statutes with the Secretary of State of the State of Nevada authorizing a 1-for-5

reverse stock split of the Company’s issued and outstanding shares of class A common stock and class B common stock.

of the Reverse Stock Split, the Company will be authorized to issue 40,000,000 shares of common stock, consisting of 2,000,000 shares

of Class A Common Stock and 38,000,000 shares of Class B Common Stock.

Preferred Stock

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of the Company.

Series A Convertible Preferred Stock

On May 24, 2024, the Company filed a Certificate

of Designation of Series A Convertible Preferred Stock (the “Certificate of Designation”) with the Secretary of State of the

State of Nevada designating 660 shares of the Company’s Preferred Stock, $ 0.0001 par value per share, as

“Series A Convertible Preferred Stock,” and setting forth the voting and other powers, preferences and relative, participating,

optional or other rights of the Series A Preferred Stock.

Each share of Series A Preferred Stock has an initial stated value (“Stated

Value”) of $ 10,000 per share.

The Series A Preferred Stock, with respect to

the payment of dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to

all capital stock of the Company unless the holders of the majority of the outstanding shares of Series A Preferred Stock consent to the

creation of other capital stock of the Company that is senior or equal in rank to the Series A Preferred Stock.

Holders of Series A Preferred Stock will be entitled

to receive cumulative dividends, in shares of Class B Common Stock or cash on the Stated Value at an annual rate of 6 % (which will

increase to 12 % if a Triggering Event (as defined in the Certificate of Designation) occurs.

Dividends will be payable upon conversion

of the Series A Preferred Stock or upon any redemption.

Holders of Series A Preferred Stock will be entitled

to convert shares of Series A Preferred Stock into a number of shares of Class B Common Stock determined by dividing the Stated Value

(plus any accrued but unpaid dividends and other amounts due, unless paid by the Company in cash) by the conversion price of the Series

A Preferred Stock (the “Conversion Price”).

The initial Conversion Price is $ 0.75 , subject to adjustment including adjustments

due to full-ratchet anti-dilution provisions.

Holders may elect to convert shares of Series A Preferred Stock to Class B Common Stock

at an alternate Conversion Price equal to 85 % (or 70 % if the Company’s Class B Common Stock is suspended from trading

on or delisted from a principal trading market or upon occurrence of a Triggering Event) of the average lowest daily volume weighed average

price of the Class B Common Stock during the Alternate Conversion Measuring Period (as defined in the Certificate of Designation).

On September 4, 2024, the Company, filed an amendment

(the “Second Amended Designation”) to the Certificate of Designation of Series A Convertible Preferred Stock of the Company

(as amended, the “Certificate of Designation”), which amended the original Certificate of Designation, as amended by the Certificate

of Amendment to Designation of Series A Convertible Preferred Stock of Asset Entities Inc.

filed with the Secretary of State of the State

of Nevada on June 14, 2024, by providing that amendments may be made to the beneficial ownership limitation provisions of the Certificate

of Designation.

The Second Amended Designation became effective immediately upon filing.

Immediately after the filing of the Second Amended

Designation, the Company filed an amendment (the “Third Amended Designation”) to the Certificate of Designation to amend the

conversion and beneficial ownership limitation provisions of the Certificate of Designation.

The conversion provisions were amended to

provide that a holder of Series A Convertible Preferred Stock, $ 0.0001 par value per share (the “Series A Preferred Stock”),

is not prohibited from delivering a Conversion Notice (as defined by the Certificate of Designation) while another Conversion Notice remains

The beneficial ownership provisions were amended to provide that any conversion of shares of Series A Preferred Stock that

would result in the holder beneficially owning in excess of 4.99 % of the shares of Class B Common Stock, $ 0.0001 par value per share (“Class

B Common Stock”), will not be effected, and the shares of Class B Common Stock that would cause such excess will be held in abeyance

and not issued to the holder until the date the Company is notified by the holder that its ownership is less than 4.99 %, at the applicable

Conversion Price (as defined by the Certificate of Designation), and subject to the holder’s compliance with other applicable procedural

requirements for conversion.

The Third Amended Designation became effective immediately upon filing.

Securities Purchase Agreement

Series A Convertible Preferred Stock

On May 24, 2024, the Company entered into a securities

purchase agreement (the “Purchase Agreement”) with an investor (the “Investor”) for the issuance and sale of up

to 330 shares of the Company’s newly designated Series A Convertible Preferred Stock, $ 0.0001 par value per share

(“Series A Preferred Stock”), for maximum gross proceeds of $ 3,000,000 .

Pursuant to the Purchase Agreement, the Company is

required to issue and sell 165 shares of Series A Preferred Stock at each of two closings subject to the satisfaction of the

terms and conditions for each closing.

The first closing (the “First Closing”) occurred on May 24, 2024 for the issuance and

sale of 165 shares of Series A Preferred Stock for gross proceeds of $ 1,500,000 .

The second closing (the “Second Closing”),

for the issuance and sale of 165 shares of Series A Preferred Stock for gross proceeds of $ 1,500,000 , will occur on the first

business day on which the conditions specified in the Purchase Agreement for the Second Closing are satisfied or waived, including the

filing and effectiveness of the Registration Statement and the effectiveness of the Stockholder Consent.

In addition, the Company issued

a warrant to Boustead for the purchase of 30,800 shares of Class B Common Stock with an exercise price of $ 3.75 per share.

The warrant is exercisable for a period of five years and contains cashless exercise provisions.

The Company received $ 1,345,000 ,

net of offering cost of $ 155,000 .

The Second Closing, for the issuance and sale

of 165 shares of Series A Preferred Stock for gross proceeds of $ 1,500,000 , occurred on July 29, 2024, which was the first business

day on which the conditions specified in the Purchase Agreement for the Second Closing were satisfied or waived.

The Company received

$ 1,302,500 , net of offering cost of $ 197,500 .

On the date of the Second Closing, the Company

was required to issue a warrant to Boustead Securities, LLC for the purchase of 30,800 shares of Class B Common Stock, equal

to 7 % of the number of shares of Class B Common Stock that may be issued upon conversion of the shares of Series A Preferred Stock

sold at the Second Closing at the initial Conversion Price of $ 3.75 per share, subject to the Exchange Limitation before the effectiveness

of the Stockholder Approval (the “Fourth Tail Warrant”).

The Fourth Tail Warrant has an exercise price of $ 3.75 per share.

On July 30, 2024, Boustead’s rights to the

Fourth Tail Warrant were assigned to an assignee.

The Fourth Tail Warrant was consequently cancelled and a new warrant was issued to the

assignee as of July 29, 2024.

During the year ended December 31, 2024, the Company

issued 330 shares of Series A Convertible Preferred Stock for $ 2,647,500 , net of discount.

During the year ended December 31, 2024, 230 shares

of Series A Convertible Preferred Stock valued at $ 2,354,110 including dividend of $ 54,110 converted into 4,293,312 shares of Class B

The Company had 100 shares of Series A Convertible

Preferred Stock issued and outstanding as of December 31, 2024.

Waiver of agreement

On September 20, 2024, the Company entered into a

Waiver and Consent, dated as of September 20, 2024 (the “Ionic ATM Waiver”), between the Company and Ionic Ventures, LLC (“Ionic”),

the sole holder of the Company’s Series A Convertible Preferred Stock, $ 0.0001 par value per share (“Series A Preferred Stock”).

Pursuant to the Waiver and Consent, Ionic waived any prohibition, restriction or adverse adjustment that would otherwise apply to any

action of the Company relating to an “at the market offering” (as defined in Rule 415(a)(4) under the Securities Act of 1933,

as amended (the “Securities Act”)), of equity securities of up to $ 5 million (“Waived ATM”) under the Securities

Purchase Agreement, dated as of May 24, 2024, between the Company and Ionic.

Pursuant to the Ionic ATM Waiver, regardless of the terms

and conditions of the Ionic Purchase Agreement and the Series A Certificate of Designation, the Company may at any time enter into any

agreement relating to a Waived ATM, the filing of a prospectus supplement to a prospectus contained in an effective registration statement

that was filed under the Securities Act relating to a Waived ATM, the announcement of a Waived ATM, the issuance, offer, sale, or grant

of any shares of the Company’s Class B Common Stock, $ 0.0001 par value per share (“Class B Common Stock”), relating

to a Waived ATM, or the issuance, offer, sale, or grant of any securities in connection with either the provision of goods or services

or settlement of any obligations that may otherwise arise with respect to a Waived ATM.

In addition, pursuant to the Ionic ATM Waiver,

Ionic waived any adjustment to the applicable Conversion Price (as defined in the Series A Certificate of Designation), which partly determines

the number of shares of Class B Common Stock issuable upon conversion of a share of Series A Preferred Stock, that would otherwise occur

as a result of any Waived ATM under the terms of the Series A Certificate of Designation.

On September 26, 2024, the Company entered into a

Limited Waiver and Consent, dated as of September 26, 2024 (the “Boustead ATM Waiver”), between the Company and Boustead Securities,

Pursuant to the Boustead ATM Waiver, Boustead waived any condition on, restriction on, compensation rights, or rights of first refusal

that would be applicable under the letter agreement, dated November 29, 2021, between the Company and Boustead (the “Boustead Engagement

Letter”) and the Underwriting Agreement, dated as of February 2, 2023, between the Company and Boustead (as representative of the

underwriters named therein) in relation to an “at the market offering” (as defined in Rule 415(a)(4) under the Securities

Act of 1933, as amended (the “Securities Act”)) of equity securities of up to $ 5 million (a “Boustead Waived ATM”).

Pursuant to the Boustead ATM Waiver, the Company may at any time enter into any agreement relating to a Boustead Waived ATM, the filing

of a prospectus supplement to a prospectus contained in an effective registration statement that was filed under the Securities Act relating

to a Boustead Waived ATM, the announcement of a Boustead Waived ATM, the issuance, offer, sale, or grant of any shares of the Class B

Common Stock relating to a Boustead Waived ATM, or the issuance, offer, sale, or grant of any securities in connection with either the

provision of goods or services or settlement of any obligations that may otherwise arise with respect to a Boustead Waived ATM.

As consideration,

the Boustead ATM Waiver provides that the Company will promptly pay Boustead 3.0 % of the gross sales price of all shares of Class B Common

Stock sold in connection with any Boustead Waived ATM until the end of the applicability of the provisions of the right of first refusal

provisions of the Boustead Engagement Letter.

Class A Common Stock

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this conversion for all periods presented.

The Company had 8,385,276 shares of Class A Common

Stock issued and outstanding as of December 31, 2023 and 2022.

The Company had 1,000,000 and 1,506,406 shares

of Class A Common Stock issued and outstanding as of December 31, 2024 and 2023, respectively.

Class B Common Stock

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holder to one ( 1 ) vote, in person or proxy, on any matter on which an action of the stockholders of the Company is sought.

Company had 9,060,965 and 1,207,827 shares of Class B Common Stock issued as of December 31, 2024 and 2023, respectively.

Fiscal year 2024

3, 2023, the Company closed an initial public offering of 1,500,000 shares of its class B common stock.

The Company raised total gross

proceeds of $ 7,500,000 in the offering, and after deducting $ 884,880 of underwriting discounts and commissions, the non-accountable

expense allowance, and other expenses from the offering, the Company received net proceeds of $ 6,615,120 .

In October 2023, 263,410 shares

of Class B Common Stock were sold to Triton Funds LP (“Triton”) for cash proceeds of $ 40,154 , net of $ 30,687 in offering costs

(see below for discussion of the purchase agreement).

year ended December 31, 2023, the Company granted 1,911,000 shares of class B restricted stock awards under the 2022 Equity

Incentive Plan (“2022 Plan”) to directors and executive officers, valued at $ 3,779,230 .

During the year ended December 31, 2024, the Company

issued and cancelled Class B common stock as follows:

● 677,056 shares of Class A common stock were converted into 677,056 shares of Class B common stock

● 124,318 shares of Class

B common stock for cash of $ 194,434 net (Triton Purchase agreement)

● 2,594,157 shares of Class B common stock for cash of $ 2,194,418 net (ATM Alternative Deal)

● 168,354 shares of Class B common stock for restricted stock awards valued at $ 161,753

● 5,000 shares of Class B common stock for purchase of intangible asset valued at $ 9,500

● 4,293,312 shares of Class B common stock for conversion of Series A Convertible Preferred stock.

891,304 shares were not yet issued at December 31, 2024

● 30,067 shares of Class B common stock for cancellation

● 50,000 treasury shares of Class B common stock for cancellation

● 71,008 shares of Class B common stock for reverse stock split adjustment

Fiscal year 2023

of the share conversion in March 2022, the Company converted the 2.44 % membership interest to 244,000 shares of Class B

Common Stock of the Company.

The Company has reflected this conversion for all periods presented.

15, 2021, the Company issued 244,000 shares of Class B Common stock for $ 250,000 .

During the year ended December 31, 2022, the

Company received $ 225,000 .

As of December 31, 2022, the Company recorded a subscription receivable of $ 0 .

9, 2022, the Company issued 250,000 shares of Class B Common stock for $ 250,000 less issuance cost of $ 75,075 .

During October

2022, the Company issued 500,000 shares of Class B Common Stock to unaffiliated investors for $ 500,000 , less issuance cost of

had 5,939,134 and 2,364,724 shares of Class B Common Stock issued as of December 31, 2023 and 2022, respectively.

The Company had 6,039,134 and 2,364,724 shares

of Class B Common Stock issued as of December 31, 2023 and 2022, respectively.

During the year ended December 31, 2023, the Company

issued Class B common stock as follows:

● 300,000 shares of Class B common stock issued for cash at $ 7,500,000 in the offering, and after deducting $ 884,880 of underwriting discounts and commissions, the non-accountable expense allowance, and other expenses from the offering, the Company received net proceeds of $ 6,615,120 .

● 52,682 shares of Class B common stock for cash of $ 40,154 net of $ 30,687 in offering costs (Triton Purchase agreement)

● 382,200 shares of Class B restricted stock awards under the 2022 Equity Incentive Plan (“2022 Plan”) to directors and executive officers, valued at $ 3,779,230 .

Treasury stock

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repurchase 50,000 shares of Class B Common stock at $ 176,876 and recorded as treasury stock as of December 31, 2023.

During 2024, all

the treasury stock was cancelled.

Triton Purchase Agreement

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shares of class B common stock, $ 0.0001 par value per share, of the Company (the “Class B Common Stock”), having a total value,

as determined under the Amended and Restated Closing Agreement, of $ 1,000,000 .

as determined under the Closing Agreement, of $ 1,000,000 .

On August 1, 2023, the Company and Triton entered

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Amended and Restated Closing Agreement, the Company may deliver a closing notice (the “Closing Notice”) and issue certain

securities to Triton at any time on or before March 31, 2024, pursuant to which Triton will be obligated to purchase such securities of

securities to Triton at any time on or before April 30, 2024, pursuant to which Triton will be obligated to purchase such securities of

the Company with an aggregate value of $ 1,000,000 in the following manner.

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days after the date of the Closing Notice.

On March 27, 2024, the Company delivered a Closing

Notice to Triton (the “Second Closing Notice”) for the purchase of 124,318 shares of the Company’s Class B

Common Stock to Triton Funds LP, a Delaware limited partnership (“Triton”).

The price of the shares was required to be 85 %

of the lowest daily volume-weighted average price of the Class B Common Stock during the five business days prior

to the closing of the purchase of the shares (the “Triton Closing”), and the Triton Closing was required to occur within five business days after

the date that the Triton Shares were received by Triton, in accordance with the Amended and Restated Closing Agreement, dated as of August

1, 2023, between the Company and Triton, as amended by the Amendment to Amended and Restated Closing Agreement, dated as of September

27, 2023, between the Company and Triton, the Second Amendment to Amended and Restated Closing Agreement, dated as of December 30, 2023,

between the Company and Triton, and the Third Amendment to Amended and Restated Closing Agreement, dated as of March 29, 2024, between

the Company and Triton (as amended, the “Amended and Restated Closing Agreement”).

On April 10, 2024, the date of the Triton

Closing, the price of the Triton Shares was determined to be $ 1.70 per share based on the lowest daily volume-weighted average price

of the Class B Common Stock during the five business days prior to the Triton Closing.

In connection with the Triton Closing, pursuant

to the Boustead Engagement Letter and the Underwriting Agreement, the Company paid Boustead, as placement agent compensation, a total

of $ 16,907 , equal to 7 % of the aggregate purchase price and a non-accountable expense allowance equal to 1 % of the aggregate

purchase price for the Triton Shares.

In addition, the Company issued a warrant to Boustead for the purchase of 8,702 shares

of Class B Common Stock, equal to 7 % of the number of the Triton Shares, with an exercise price of $ 1.70 per share, equal to

the purchase price per share of the Triton Shares (the “Tail Warrant”).

The Tail Warrant is exercisable for a period

of five years and contains cashless exercise provisions.

Sales agreement of Class B Common Stock

On September 27, 2024, the Company entered into

a Sales Agreement between the Company and A.G.P./Alliance Global Partners (the “Sales Agent”).

Pursuant to the prospectus

supplement and accompanying base prospectus relating to the offering of the Shares (as defined below), and under terms of the Sales Agreement

and the prospectus supplement and the accompanying base prospectus, filed on September 27, 2024, the Company may, from time to time, in

transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended

(the “Securities Act”), issue and sell through or to the Sales Agent, up to a maximum aggregate amount of $ 1,791,704 of shares

of the Company’s Class B Common Stock, $ 0.0001 par value per share (the “Shares”).

The Company will pay the Sales Agent a cash commission

of 3.0 % of the gross sales price of the Shares sold by the Sales Agent pursuant to the Sales Agreement.

Pursuant to the terms of the Sales

Agreement, the Company also agreed to reimburse the Sales Agent for reasonable fees and expenses, not to exceed $ 60,000 (including but

not limited to the reasonable and documented fees and disbursements of its legal counsel), and additional amounts for annual maintenance

of the Sales Agreement (including but not limited to the reasonable and documented fees and disbursements of its legal counsel) on a quarterly

basis, not to exceed $ 5,000 per quarter.

Equity Incentive Plan

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compensation expense is recognized as the shares vest with a corresponding offset credited to additional paid-in-capital.

December 31, 2023, the Company recorded stock-based compensation expense of $ 1,295,931 .

As of December 31, 2023, 196,000 RSA

shares have vested.

As of December 31, 2023, there was $ 2,483,299

of unrecognized stock-based compensation expense related to unvested RSUs, which is expected to be recognized over a weighted-average

period of 2.09 years.

December 31, 2024 and 2023, the Company recorded stock-based compensation expense of $ 1,212,357 and $ 1,295,931 , respectively.

of December 31, 2024 and 2023, 317,420 and 39,200 RSA shares have vested, respectively.

As of December 31, 2024 and 2023, there was $ 1,067,382

and $ 2,483,299 of unrecognized stock-based compensation expense related to unvested RSUs, which is expected to be recognized over a weighted-average

period of 1.13 and 2.09 years, respectively.

In June and October 2022, the Company issued a

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accounted for these warrants as equity-classified instruments.

7, 2023, the Company issued 105,000 warrants exercisable into 105,000 shares of the Company’s Class B Common

Stock which is equal to 7 % of the aggregate number of shares of Class B Common Stock sold in the above mentioned initial public offering.

These warrants carry an exercise price of $ 6.25 per share, which is equal to 125 % of the public offering price, subject to adjustment,

the warrants also include a cashless exercise provision;

7, 2023, the Company issued 21,000 warrants to purchase Class B Common stock Company’s Class B Common Stock

which is equal to 7 % of the aggregate number of shares of Class B Common Stock sold in the above mentioned initial public offering.

These warrants carry an exercise price of $ 31.25 per share, which is equal to 125 % of the public offering price, subject to

adjustment, the warrants also include a cashless exercise provision;

these warrants may be exercised at any time for five years following

the date of issuance.

On April 17, 2024, the Company issued a total

of 8,702 warrants to purchase Class B Common Stock for a success fee of private placements of shares of Class B common stock.

price of warrants is $ 1.70 and expiration date is the date that is five years from the issuance date of each warrant.

The Company accounted

for these warrants as equity-classified instruments.

In May and July 2024, the Company issued a total

of 61,600 warrants to purchase Class B Common stock for a success fee of private placements of shares of Class B common stock.

price of warrants is $ 3.75 and expiration date is the date that is five years from the issuance date of each warrant.

The Company accounted

for these warrants as equity-classified instruments.

On October 11, 2023, the Company issued warrants

to purchase 3,688 shares of Class B Common Stock as a success fee in connection with a private placement.

The exercise price of the warrants

is $ 1.3447 and the expiration date is the date that is five years from the issuance date of the warrant.

The Company accounted for these

warrants as equity-classified instruments.

A summary of activity during the years ended December

31, 2024 and 2023, follows:

December 31, 2021

December 31, 2022

December 31, 2023

Weighted Weighted

Average Average

Exercise Price Life

Outstanding, December 31, 2022 10,500 $ 31.25 4.68

Granted 24,688 26.78 4.90

Outstanding, December 31, 2023 35,188 $ 28.12 4.05

Granted 70,302 3.50 4.92

Outstanding, December 31, 2024 105,490 $ 11.71 3.92

All of the outstanding warrants are exercisable

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net expense included in the consolidated statements of operations for the year ended December 31, 2024 and 2023 is as follows:

For the Years ended

Income tax expense (credit) at statutory rate

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Valuation allowance

( 1,987,040 )

Deferred tax asset

Asset acquisition

On November 10, 2023,

Asset Entities Inc., a Nevada corporation (the “Company”), entered into an asset purchase agreement (the “Asset Purchase

Agreement”) with Ternary Inc., a Florida corporation (“Ternary FL”), Ternary Developments Inc., a Delaware corporation

(“Ternary DE”), OptionsSwing Inc., a Florida corporation (“OSI,” and together with Ternary FL and Ternary DE,

individually, a “Seller,” and collectively, the “Sellers”), and Jason Lee, the principal shareholder of each Seller

(the “Shareholder”).

Under the Asset Purchase Agreement, the Company agreed to purchase all of the Sellers’ right, title,

and interest in and to substantially all of the assets and properties owned by the Sellers and used in connection with their business

of Discord development, social media, online community management, marketing, and business-to-business software-as-a-service that offers

sales, service, marketing, and analytics for the payment of $ 100,000 in cash (the “Cash Consideration”), the issuance of 300,000

shares of Class B Common Stock, $ 0.0001 par value per share, of the Company (the “Stock Consideration”), and other good and

valuable consideration as described herein.

Pursuant to the Asset

Purchase Agreement, on November 10, 2023, the Company paid the Sellers $ 100,000 , issued 177,000 shares of the Stock Consideration to the

Shareholder, and 123,000 shares of the Stock Consideration in the aggregate to three other designated individuals, and the Sellers and

the Shareholder delivered title to all of the assets of the Sellers.

The Stock Consideration is subject to vesting conditions for the

two-year period following the grant date, subject to immediate vesting upon a change of control of the Company or certain other events.

Subsequent Events

evaluated all events from the date of the balance sheet, which was December 31, 2023 through April 2, 2024 which was the date these consolidated

evaluated all events from the date of the balance sheet, which was December 31, 2024 through March 31, 2025 which was the date these

financial statements were available to be issue.

Based on our evaluation no material events have occurred that require disclosure

other than as disclosed below.

On March 27, 2024, the Company delivered a Closing

Notice to Triton (the “Second Closing Notice”) for the purchase of 621,590 shares of Class B Common Stock (the “Second

Triton Shares”), which was the amount of shares of Class B Common Stock remaining under the registration statement.

each of the Second Triton Shares is required to be set at 85 % of the lowest daily volume-weighted average price of the Class B Common

Stock during the five business days prior to the closing of the purchase of the Second Triton Shares (the “Second Triton Closing”).

The Second Triton Closing is required to occur within five business days after the delivery of the Second Triton Shares to Triton.

connection with the Second Triton Closing, pursuant to its engagement letter with Boustead Securities, LLC (“Boustead”), dated

November 29, 2021, and the underwriting agreement, dated February 2, 2023, with Boustead, the Company will pay Boustead a fee equal to

7 % of the aggregate purchase price and a non-accountable expense allowance equal to 1 % of the aggregate purchase price for the Second

Triton Shares.

In addition, the Company will issue a warrant to Boustead for the purchase of 43,511 shares of Class B Common Stock, equal

to 7 % of the number of the Second Triton Shares, with an exercise price equal to the purchase price per share of the Second Triton Shares.

Under a Third Amendment

to Amended and Restated Closing Agreement (the “Third Triton Amendment”), dated as of March 29, 2024, the Company and Triton

agreed to amend the Amended A&R Closing Agreement to provide that the Amended A&R Closing Agreement will expire on April 30, 2024,

instead of March 31, 2024.

The Third Triton Amendment did not amend any of the other provisions of the Amended A&R Closing Agreement.

other than below.

21, 2025, the conversion price at initial price is amended from $ 0.75 to $ 3.75 .

As of February

14, 2025, the Company has sold $ 5,489,371 in relation of Sales Agreement (the “ATM Sales”) between the Company and Alliance

Global Partners with up to a maximum aggregate amount of $ 5,489,399 of shares of the Company’s Class B Common Stock, $ 0.0001 par

value per share.

Pursuant to the requirements of Section 13 or

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thereunto duly authorized.

April 2, 2024

March 31, 2025

ASSET ENTITIES INC.

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on the dates indicated.

/s/ Arshia Sarkhani

Chief Executive Officer, President and Director (principal executive officer)

March 31, 2025

Arshia Sarkhani

Executive Officer, President and Director

executive officer)

/s/ Matthew Krueger

Chief Financial Officer (principal financial and accounting officer)

March 31, 2025

Matthew Krueger

Financial Officer

financial and accounting officer)

/s/ Michael Gaubert

Executive Chairman and Director

March 31, 2025

Michael Gaubert

Chairman and Director

/s/ Kyle Fairbanks

Executive Vice-Chairman, Chief Marketing Officer and Director

March 31, 2025

Kyle Fairbanks

Vice-Chairman, Chief Marketing Officer and Director

/s/ Richard A.

March 31, 2025

/s/ David Reynolds

March 31, 2025

David Reynolds

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

What changed 10-K

Item 9A. Controls and Procedures