What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-19 compared with 2025-03-31 · 276 added, 1014 removed, 6 unchanged (100% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

following discussion and analysis summarizes the significant factors affecting our operating results, financial condition, liquidity and

cash flows as of and for the periods presented below.

The following discussion and analysis should be read in conjunction with our financial

statements and the related notes thereto included elsewhere in this Annual Report.

The discussion contains forward-looking statements

that are based on the beliefs of management, as well as assumptions made by, and information currently available to, management.

results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors, including

those discussed below and elsewhere in this Annual Report, particularly in the sections titled Item 1A.

“ Risk Factors”

and “ Cautionary Note Regarding Forward-Looking Statements.

Asset Entities is a technology company providing

social media marketing and content delivery services across Discord, TikTok, and other social media platforms.

We also design, develop

and manage servers for communities on Discord.

Based on the growth of our Discord servers and social media following, we have developed

three categories of services:

(1) our Discord investment education and entertainment services, (2) social media and marketing services,

and (3) our “AE.360.DDM” brand services.

We also offer Ternary v2, a cloud-based subscription management and payment processing

solution for Discord communities, which includes a suite of customer relations management tools and Stripe-verified payment processing.

All of our services are based on our effective use of Discord as well as other social media including TikTok, X, Instagram, and YouTube.

Our Discord investment education and entertainment

service is designed primarily by and for enthusiastic Generation Z, or Gen Z, retail investors, creators and influencers.

Gen Z is commonly

considered to be people born between 1997 and 2012.

Our investment education and entertainment service focuses on stock, real estate,

cryptocurrency, and NFT community learning programs designed for the next generation.

While we believe that Gen Z will continue to be

our primary market, our Discord server offering features education and entertainment content covering real estate investments, which is

expected to appeal strongly to older generations as well.

Our combined server user membership was approximately 206,899 as of December

Our social media and marketing services utilize

our management’s social influencer backgrounds by offering social media and marketing campaign services to business clients.

team of social influencer independent contractors, which we call our “SiN” or “Social Influencer Network”, can

perform social media and marketing campaign services to expand our clients’ Discord server bases and drive traffic to their businesses,

as well as increase membership in our own servers.

Our “AE.360.DDM, Design Develop Manage”

service, or “AE.360.DDM”, is a suite of services to individuals and companies seeking to create a server on Discord.

we are the first company to provide “Design, Develop and Manage,” or DDM, services for any individual, company, or organization

that wishes to join Discord and create their own community.

With our AE.360.DDM rollout, we are uniquely positioned to offer DDM services

in the growing market for Discord servers.

Through Ternary v2, our subscription management

and payment processing solution for Discord communities, subscribers can monetize and manage their Discord users.

Ternary v2 simplifies

the process for our subscribers to:

(i) sell memberships to their Discord servers on their websites and collect payments through Stripe

with daily payouts;

(ii) add digital products and services and designate purchase options to their Discord servers;

(iii) customize their

user Discord permissions and roles and other Discord settings;

and (iv) utilize our Discord bot to automatically apply their

Discord user settings to authenticate new users, apply customizable permission sets to users, and remove users when their subscriptions

As a Stripe-verified partner through Ternary v2, we can also assist subscribers with integrating other platforms into their Discord

servers with open application programming interfaces, further extending our platform’s capabilities.

We believe that we are a leading provider of all

of these services, and that demand for all of our services will continue to grow.

We expect to experience rapid revenue growth from our

We believe that we have built a scalable and sustainable business model and that our competitive strengths position us favorably

in each aspect of our business.

Our revenue depends on the number of paying subscribers

to our Discord servers.

During the years ended December 31, 2024 and 2023, we received revenue from 1,302 and 298 Asset Entities Discord

server paying subscribers, respectively.

Our Historical Performance

of December 31, 2024, the Company had an accumulated deficit of $12,006,357 and a cash balance of $2,660,624.

During the years ended

December 31, 2024 and 2023, we had a net loss of $6,393,932 and $4,931,197, respectively.

To date, the Company has financed its

operations primarily through capital raises and sales of its services.

In April 2024, the Company filed the Shelf Registration

Statement, which was declared effective by the SEC on April 26, 2024, for potential offerings of up to $100,000,000 in aggregate,

subject to the requirement that in no event may we sell shares having a value exceeding more than one-third of our public float in

any 12-month period under the Shelf Registration Statement so long as our public float remains below $75,000,000.

In May 2024, the

Company completed the first of a two-part private placement of its Series A Preferred Stock for gross proceeds of $1.5 million, and

in July 2024, the Company completed the second part of the private placement for an additional $1.5 million in gross proceeds.

September 2024, the Company entered into the ATM Sales Agreement, and filed a prospectus supplement to the Shelf Registration

Statement for the ATM Financing for gross proceeds of up to $1,791,704.

As of March 31, 2025, the Company had filed additional

prospectus supplements to the Shelf Registration Statement to increase the maximum gross proceeds to $5,489,399.

commencement of the ATM Financing, a total of 5,417,700 shares has been sold, for net proceeds to the Company of $4,830,647.56,

after paying $329,362 in compensation to the Sales Agent and the same amount to Boustead under the Boustead ATM Waiver.

Company has received confirmation from the investor in its Series A Preferred Stock that it will invest up to an additional $3

million upon request by the Company.

Based on the Company’s existing cash resources and the cash expected to be

received from the ATM Financing and other planned financings, it is expected that the Company will have sufficient funds to carry

out the Company’s planned operations through December 31, 2025 and for at least 12 months beyond that period.

discussion, see Item 7.

“ —Liquidity and Capital Resources ”.

Principal Factors Affecting Our Financial Performance

Our operating results are primarily affected by

the following factors:

● our ability to acquire new customers and users or retain existing customers and users;

● our ability to offer competitive pricing;

● our ability to broaden product or service offerings;

● industry demand and competition;

● our ability to leverage technology and use and develop efficient processes;

● our ability to attract and retain talented employees and contractors;

● market conditions and our market position.

Emerging Growth Company and Smaller Reporting

We qualify as an “emerging growth company”

under the JOBS Act.

As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements.

as we are an emerging growth company, we will not be required to:

● have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of

the Sarbanes-Oxley Act;

● present three years, instead of two years, of audited financial statements, with correspondingly reduced

“ Management’s Discussion and Analysis of Financial Condition and Results of Operations ” disclosure in this Annual

● comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding

mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial

statements (i.e., an auditor discussion and analysis);

● comply with certain greenhouse gas emissions disclosure and related third-party assurance requirements;

● submit certain executive compensation matters to stockholder advisory votes, such as “say-on-pay”

and “say-on-frequency;” and

● disclose certain executive compensation related items such as the correlation between executive compensation

and performance and comparisons of the chief executive officer’s compensation to median employee compensation.

In addition, Section 107 of the JOBS Act also

provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities

Act for complying with new or revised accounting standards.

In other words, an emerging growth company can delay the adoption of certain

accounting standards until those standards would otherwise apply to private companies.

We have elected to take advantage of the benefits

of this extended transition period.

Our financial statements may therefore not be comparable to those of companies that comply with such

new or revised accounting standards.

We will remain an emerging growth company for

up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1,235,000,000,

(ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur

if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently

completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding

three year period.

To the extent that we continue to qualify as a

“smaller reporting company,” as such term is defined in Rule 12b-2 under the Exchange Act, after we cease to qualify as an

emerging growth company, certain of the exemptions available to us as an emerging growth company may continue to be available to us as

a smaller reporting company, including as to:

(i) the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act;

scaled executive compensation disclosures;

(iii) presenting two years of audited financial statements, instead of three years;

compliance with certain greenhouse gas emissions disclosure and related third-party assurance requirements.

Recent Developments

Amended and Restated Waiver and Consent

On March 20, 2025, the Company entered into an

Amended and Restated Waiver and Consent, dated as of March 20, 2025 (the “A&R Ionic ATM Waiver”), between the Company

and Ionic Ventures, LLC, a California limited liability company (“Ionic”), the sole holder of the Series A Preferred Stock.

Pursuant to the A&R Ionic ATM Waiver, 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),

under a sales agreement between the Company and A.G.P.

under which the Company may offer and sell through A.G.P., as sales agent, the

Company’s shares of Class B Common Stock (“Waived A.G.P.

ATM”), under the Securities Purchase Agreement, dated as of

May 24, 2024, between the Company and Ionic, as amended by the First Amendment to Securities Purchase Agreement, dated as of June 13,

2024, between the Company and Ionic (as amended, the “Ionic Purchase Agreement”), or Series A Certificate of Designation.

Pursuant to the A&R 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 or consummate the transactions contemplated by 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 A.G.P.

ATM, the announcement of a Waived A.G.P.

ATM, the issuance, offer, sale, or grant of any

shares of the Class B Common Stock relating to a Waived A.G.P.

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 A.G.P.

In addition, pursuant to the A&R 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 A.G.P.

ATM under the terms of the Series

A Certificate of Designation.

Forward-Looking Information

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and notes to those consolidated financial statements included in Item 15 of this Annual Report.

References to "we", "us", "our", or "the Company" refer to Strive, Inc.

and its consolidated subsidiaries unless specifically stated otherwise.

In addition to historical financial information, this discussion and analysis contains forward-looking statements that are based upon our current expectations, beliefs, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control.

See the section of this Annual Report entitled “Forward Looking Information and Risk Factor Summary.” Actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Part I.

Risk Factors” or elsewhere in this Annual Report.

References to "we", "us", "our", or "the Company" refer to Strive, Inc.

and its consolidated subsidiaries unless specifically stated otherwise.

1:20 Reverse Stock Split

On February 6, 2026, we completed a 1:20 reverse stock split of our Class A and Class B Common Stock (the "Reverse Stock Split").

As a result of the Reverse Stock Split, all applicable share and per share information of the Successor presented within this “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations” has been retroactively adjusted to reflect the Reverse Stock Split for all periods presented.

Concurrent with the effectiveness of the Reverse Stock Split, the number of shares of Class A Common Stock available to purchase and the related exercise price of outstanding warrants were adjusted pro-rata to give effect to the Reverse Stock Split.

Strive is a structured finance company and institutional asset manager focused on disciplined capital allocation and long term value creation.

We have strategically adopted bitcoin as our hurdle rate for capital deployment because of our fiduciary duty to maximize long-term value for stockholders, and compounding purchasing power over time.

Relative to a traditional depreciating fiat-denominated benchmark, implementing a bitcoin hurdle rate establishes a higher level of accountability and strategic investment discipline, since our decisions are measured against an asset we believe will appreciate over time.

Strive’s operating business generates stockholder value through disciplined balance sheet management and the growth of our bitcoin holdings.

Our SATA Stock exemplifies this approach, a publicly traded security that aims to provide investors with consistent cash flows and minimal volatility, while enabling Strive to capture the spread between SATA Stock’s financing cost and the potential long term return of bitcoin.

Beyond balance sheet strategy, Strive is focused on advancing innovation within the capital markets by modernizing established financing structures.

The Company has developed our SATA Stock, our perpetual preferred equity instrument, that incorporates an at‑the‑market (“ATM”) program, creating a flexible and continuous capital formation mechanism.

This approach transforms a historically static capital structure into a dynamic and adaptive capital funding platform.

these innovations, Strive seeks to combine legacy market frameworks with modern assets, positioning the Company at the intersection of institutional finance and a bitcoin‑based reserve strategy.

Following the completion of Strive Enterprises, Inc.'s reverse acquisition of Asset Entities Inc.

in September 2025, Strive began operating as a publicly traded company and began deploying capital to execute on its bitcoin treasury strategy, becoming the first U.S.

publicly traded bitcoin treasury asset management firm.

As of December 31, 2025, the Company manages over $2.4 billion in AUM.

These activities provide recurring, fee-based revenue streams which increase with AUM.

Beginning in fiscal year 2026, we plan to operate our asset-management segment within a single-digit-million dollar operating loss to single-digit-million dollar operating profit range.

On September 22, 2025, Strive, Inc.

entered into the Semler Scientific Merger Agreement with Semler Scientific.

On January 16, 2026, pursuant to the Semler Scientific Merger Agreement, Strive Merger Sub, Inc., a wholly owned subsidiary of Strive merged with and into Semler Scientific, with Semler Scientific continuing as the surviving corporation and a wholly owned subsidiary of Strive.

Through the acquisition of Semler Scientific, Strive acquired Semler Scientific's existing bitcoin reserve as well as Semler Scientific's operating business, which develops and markets technology products and services that assist customers in evaluating and treating chronic diseases.

The patented and FDA cleared product, QuantaFlo, measures arterial blood flow in the extremities to aid in the diagnosis of PAD.

QuantaFlo, which is intended to enable expanded labeling as an aid in the diagnosis of other cardiovascular diseases, is currently pursuing a 510(k) clearance from the FDA.

Our Bitcoin Strategy

Our bitcoin strategy generally involves, from time to time, subject to market conditions and the need for cash and cash equivalents to meet short-term working capital requirements, (i) acquiring bitcoin through open market purchases using available cash, which may be raised from our operating activities as well as capital raising initiatives, such as issuing equity and fixed income offerings, among other capital raise strategies (collectively, "beta" initiatives) and (ii) acquiring bitcoin through alpha strategies, such as acquiring bitcoin through strategic M&A activity or other transactions, resulting in the acquisition of bitcoin at a discount relative to market value, which are intended to deliver returns above and beyond what beta initiatives may deliver alone.

Our Bitcoin Holdings

In 2025, we acquired a total of approximately 7,627 bitcoin at an aggregate acquisition cost of approximately $863.0 million, or $113,153 per bitcoin, including fees and expenses.

During the period from January 1, 2026 to March 17, 2026, we acquired approximately 5,048 bitcoin through our acquisition of Semler Scientific and purchased an additional 953 bitcoin at an average price of approximately $81,092 per bitcoin, inclusive of fees and expenses.

In addition, in March 2026, we made an initial investment of $50.0 million in the Variable Rate Series A Perpetual Stretch Preferred Stock (the "STRC Stock") of Strategy Inc.

As of December 31, 2025, our digital assets, at fair value totaled approximately $668.5 million within our consolidated statement of financial condition, consisting of approximately 7,627 bitcoin.

We also held $67.5 million in cash and cash equivalents, putting us in a position to strategically deploy capital to bolster our treasury.

As of March 17, 2026, our cash and cash equivalents totaled $83.7 million, while our position in the STRC Stock had a fair value of $50.4 million.

Our bitcoin treasury totaled 13,628 bitcoin as of March 17, 2026.

Business Combination with Asset Entities Inc.

On May 6, 2025, Strive Enterprises, Inc.

entered into that certain Agreement and Plan of Merger, dated as of May 6, 2025, as amended by that certain Amended and Restated Agreement and Plan of Merger, dated as of June 27, 2025, with Asset Entities Inc.

On September 12, 2025, pursuant to the Asset Entities Merger Agreement, Alpha Merger Sub, Inc., a wholly-owned subsidiary of Asset Entities, merged with and into Strive Enterprises, Inc., with Strive Enterprises, Inc.

surviving as a wholly owned subsidiary of Asset Entities.

Concurrent with the consummation of the transactions contemplated by the Asset Entities Merger Agreement, Asset Entities Inc.

was renamed Strive, Inc.

and became the first publicly traded bitcoin treasury asset management firm.

Concurrent with the consummation of the Asset Entities Merger, the Company closed its PIPE Financing Transactions, issuing Class A Common Stock and pre-funded warrants to raise $749.6 million in gross proceeds, with the ability to raise $749.6 million in additional gross proceeds upon the exercise of traditional warrants issued to PIPE participants.

In addition, the Company completed an exchange pursuant to Section 351 of the Internal Revenue Code of 1986, as amended, with certain accredited investors, in which the Company exchanged 2.7 million shares (134 thousand shares on a split-adjusted basis) of Class A Common Stock for 69 bitcoin (the "351 Exchange").

The bitcoin acquired through the 351

Exchange, along with open market purchases of 7,558 bitcoin by the Company, resulted in the Company acquiring an aggregate of 7,627 bitcoin during the period from September 12, 2025 to December 31, 2025.

Business Combination with Semler Scientific, Inc.

On September 22, 2025, the Company entered into the Semler Scientific Merger Agreement with Semler Scientific.

As part of the closing of the Semler Scientific Merger, the Company acquired the assets held by Semler Scientific, including 5,048 bitcoin held by Semler Scientific, which includes certain bitcoin held as collateral by a third party as collateral for an outstanding loan, and assumed Semler Scientific's outstanding liabilities.

Capital Markets Activity

On September 15, 2025, the Company entered into a Controlled Equity Offering SM Sales Agreement (the “ASST Sales Agreement”) with Cantor Fitzgerald & Co.

(the “ASST Sales Agent”), pursuant to which the Company, from time to time, at its option, may offer and sell shares of its Class A Common Stock to or through the ASST Sales Agent, acting as the principal and/or the sole agent, having an aggregate sales price of up to $450.0 million.

During the period from September 12, 2025 to December 31, 2025, the Company issued 26.4 million shares (1.3 million on a split-adjusted basis) of Class A Common Stock for aggregate gross proceeds of $78.7 million.

As of December 31, 2025, the Company has the availability to raise approximately $371.3 million through the issuance and sale of its Class A Common Stock pursuant to the ASST Sales Agreement.

On November 10, 2025, the Company issued 2,000,000 shares of SATA Stock in an initial public offering registered under the Securities Act.

The Company filed a certificate of designation with the Nevada Secretary of State designating and establishing the terms of the SATA Stock.

The SATA Stock is listed for trading on the Nasdaq Global Market under the symbol “SATA.” The Company received approximately $148.4 million of net proceeds, after deducting the underwriting discounts and commissions and offering expenses, from the issuance of SATA Stock in the initial public offering of SATA Stock.

On December 9, 2025, the Company entered into a Controlled Equity Offering SM Sales Agreement (the “SATA Sales Agreement”) with each of Cantor Fitzgerald & Co., Barclays Capital Inc., and Clear Street LLC (each, a "SATA Sales Agent", and collectively the “SATA Sales Agents”), pursuant to which the Company, from time to time, at its option, may offer and sell shares of its SATA Stock to or through the SATA Sales Agents, acting as the principal and/or agent, having an aggregate sales price of up to $500.0 million.

During the period from September 12, 2025 to December 31, 2025, the Company issued 13 thousand shares of SATA Stock for aggregate gross proceeds of $1.2 million.

As of December 31, 2025, the Company has the availability to raise approximately $498.8 million through the issuance and sale of its SATA Stock pursuant to the SATA Sales Agreement.

On January 27, 2026, the Company issued 1,320,000 shares of SATA Stock in a public follow-on offering registered under the Securities Act (the "Follow-On Offering").

The Company received approximately $109.2 million of net proceeds, after deducting the underwriting discounts and commissions and expected offering expenses, from the issuance of SATA Stock in the Follow-On Offering.

Partial Retirement of 4.25% Convertible Senior Notes due 2030

On January 16, 2026, in connection with the Semler Scientific Merger, we assumed $100.0 million of the 4.25% Convertible Senior Notes due 2030 (the “Semler Convertible Notes”) from Semler Scientific.

Upon the completion of the Semler Scientific Merger, Semler Scientific, Strive and U.S Bank Trust Company, National Association, as trustee, entered into a supplemental indenture, dated January 16, 2026 (the “Supplemental Indenture”), to that certain indenture, dated as of January 28, 2025 (such indenture as so amended, supplemented and modified from time to time, the “Convertible Notes Indenture”), pursuant to which Semler Scientific issued its outstanding 4.25% Convertible Senior Notes due 2030 (the “Semler Convertible Notes”).

The Supplemental Indenture provides that, as of the effective time of the Semler Scientific Merger (the “Effective Time”), the right of the holders of the Semler Convertible Notes that were outstanding as of the Effective Time to convert each $1,000 principal amount of such Semler Convertible Notes into shares of common stock of Semler Scientific (“Semler Common Stock”) became a right to convert such principal amount of Semler Convertible Notes into the number of shares of Class A Common Stock, that a holder of such number of shares of Semler Common Stock equal to the Conversion Rate (as defined in the Convertible Notes Indenture) immediately prior to the Effective Time would have been entitled to receive upon the completion of the Semler Scientific Merger;

provided, however, that at and after the Effective Time (A) Semler Scientific will continue to have the right to determine the form of consideration to be paid or delivered, as the case may be, upon conversion of the Semler Convertible Notes in accordance with the terms of the

Convertible Notes Indenture, (B) any amount payable in cash upon conversion of the Semler Convertible Notes in accordance with the terms of the Convertible Notes Indenture will continue to be payable in cash and (C) the Daily VWAP (as defined in the Convertible Notes Indenture) will be calculated (in a manner determined by Semler Scientific in good faith) based on the value of a share of our Class A Common Stock.

Upon completion of the Semler Scientific Merger, each then-outstanding share of Semler Common Stock was converted into the right to receive 21.05 shares of Class A Common Stock, resulting in an adjusted initial Conversion Rate of 275.3887 shares of Class A Common Stock per $1,000 principal amount of Semler Convertible Notes, which was further adjusted to an initial Conversion Rate of 13.7694 shares of Class A Common Stock per $1,000 principal amount of Semler Convertible Notes after giving effect to the Reverse Stock Split.

In addition, the Supplemental Indenture provides for a guarantee of the Semler Convertible Notes by Strive.

As amended by the terms of the Supplemental Indenture, the Semler Convertible Notes are general senior, unsecured obligations of Semler Scientific, guaranteed by Strive, and will mature on August 1, 2030, unless earlier converted, redeemed or repurchased.

The Semler Convertible Notes bear interest at a rate of 4.25% per year, payable semiannually in arrears on February 1 and August 1 of each year.

In connection with the pricing of the Semler Convertible Notes, Semler Scientific entered into privately negotiated capped call transactions with the Option Counterparties.

The capped call transactions cover, subject to customary adjustments, the number of shares of Class A Common Stock that initially underlie the Semler Convertible Notes.

The capped call transactions are expected to offset the potential dilution as a result of any conversion of Semler Convertible Notes.

On January 22, 2026, the Company entered into separate, privately negotiated exchange agreements with certain holders of the Semler Convertible Notes, representing $90.0 million aggregate principal amount of the Semler Convertible Notes, pursuant to which such holders exchanged their Semler Convertible Notes for approximately 929,999 newly issued shares of SATA Stock concurrent with the closing of the Follow-On Offering.

As of January 27, 2026, and following the settlement of the Notes Exchange, $10.0 million aggregate principal amount of the Semler Convertible Notes remained outstanding.

Retirement of Acquired Indebtedness

On January 16, 2026, in connection with the Semler Scientific Merger, we assumed a $20.0 million loan with Coinbase Credit Inc.

from Semler Scientific (the “Coinbase Loan”).

On January 27, 2026, we fully retired the Coinbase Loan, resulting in all of Strive's bitcoin holdings being unencumbered following the retirement.

Critical Accounting Estimates

Our discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with GAAP, which requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, and equity, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.

Actual results and outcomes could differ from these estimates and assumptions.

Critical accounting estimates involve a significant level of estimation uncertainty and are estimates that have had or are reasonably likely to have a material impact on our financial condition or results of operations.

Please refer to Note 2, “Summary of Significant Accounting Policies”, in the notes to the Consolidated Financial Statements included in this Annual Report for a description of Strive’s significant accounting policies.

Results of Operations

The following table summarizes our results of

operations for the fiscal years ended December 31, 2024 and 2023.

Consolidated Operations Data

The comparability of our operating results for the period from September 12, 2025 to December 31, 2025 (Successor), for the period from January 1, 2025 to September 11, 2025 (Predecessor), and for the year ended December 31, 2024 (Predecessor) was impacted by our Asset Entities Merger and may not be comparable.

For the purposes of the comparison of the results of operations below, we have compared the Predecessor year ended December 31, 2024 to the combined Predecessor and Successor periods of 2025.

Comparison of the Year Ended December 31, 2025 and the Year Ended December 31, 2024

The following table presents information regarding the consolidated results of operations for the period from September 12, 2025 to December 31, 2025 (Successor) and for the period from January 1, 2025 to September 11, 2025 (Predecessor) compared to the year ended December 31, 2024 (Predecessor) (amounts in thousands, other than percentages):

Successor Predecessor Increase (Decrease)

Period from September 12, 2025 to December 31, 2025 Period from January 1, 2025 to September 11, 2025 Year Ended December 31, 2024 $ %

Investment advisory fees $ 1,495 $ 4,187 $ 3,592 $ 2,090 58.2 %

Other revenue 17 35 58 (6) (10.3) %

Total revenues 1,512 4,222 3,650 2,084 57.1 %

Operating expenses:

Contract labor

General and administrative

Management compensation

Fund management and administration 1,867 4,250 4,867 1,250 25.7 %

Employee compensation and benefits 27,639 7,222 9,135 25,726 281.6 %

General and administrative expense 3,681 4,229 11,248 (3,338) (29.7) %

Marketing and advertising 151 231 862 (480) (55.7) %

Depreciation and amortization 71 149 192 28 14.6 %

Total operating expenses 33,409 16,081 26,304 23,186 88.1 %

Loss from operations

Interest income

Total other income

Our revenue increased 128.7% to approximately $0.6 million for the fiscal year ended December 31, 2024 from approximately $0.3 million

for the fiscal year ended December 31, 2023.

This increase was primarily due to an increase in revenues from the increased number of

our Discord server paying subscribers during the fiscal year ended December 31, 2024, including subscribers to the OptionsSwing and Pure

Profits Discord servers that the Company acquired in November 2023 and June 2024, respectively, compared to such revenues for the fiscal

year ended December 31, 2023, the majority of which preceded the acquisitions of the OptionsSwing and Pure Profits Discord servers.

was no material difference in the Company’s subscription pricing structure between these periods.

Operating Expenses .

Our total operating

expenses increased 35.1% to approximately $7.0 million for the fiscal year ended December 31, 2024 from approximately $5.2 million for

the fiscal year ended December 31, 2023.

This increase was primarily due to an increase in advertising, marketing, payroll and other

administrative expenses and administrative cost of public filings of approximately $1.1 million and an increase in management compensation

costs of approximately $0.7 million for the fiscal year ended December 31, 2024, compared to such costs for the fiscal year ended December

From Operations .

Our loss from operations increased 29.9% to approximately $6.4 million for the fiscal year ended December 31,

2024 from approximately $4.9 million for the fiscal year ended December 31, 2023.

This increase was primarily due to an increase in advertising,

marketing, payroll and other administrative expenses and administrative cost of public filings of approximately $1.1 million and an

increase in management compensation costs of approximately $0.7 million for the fiscal year ended December 31, 2024, compared to such

costs for the fiscal year ended December 31, 2023.

Investment gains/(losses):

Net unrealized loss on digital assets, at fair value (194,508) — — (194,508) (100.0) %

Other derivative loss (14,731) — — (14,731) (100.0) %

Net investment gains/(losses) (209,239) — — (209,239) (100.0) %

Net operating loss (241,136) (11,859) (22,654) (230,341) 1,016.8 %

Other income/(expense):

Other income 723 586 795 514 64.7 %

Transaction costs (12,400) (15,717) — (28,117) (100.0) %

Gain on lease remeasurement — — 279 (279) (100.0) %

Goodwill and intangible asset impairment (140,785) — — (140,785) (100.0) %

Total other income/(expense) (152,462) (15,131) 1,074 (168,667) (15,704.6) %

Net loss before income taxes (393,598) (26,990) (21,580) (399,008) 1,849.0 %

Income tax benefit/(expense) — — — — — %

Net loss $ (393,598) $ (26,990) $ (21,580) $ (399,008) 1,849.0 %

Dividends on preferred stock (4,320) — — (4,320) 100.0 %

Net loss attributable to common stockholders $ (397,918) $ (26,990) $ (21,580) $ (403,328) 1,869.0 %

Investment advisory fees

Investment advisory fees increased by $2.1 million, or 58.2%, to $5.7 million ($1.5 million for the period from September 12, 2025 to December 31, 2025 and $4.2 million for the period from January 1, 2025 to September 11, 2025) from $3.6 million for the year ended December 31, 2024.

This increase was driven by an increase in average assets under management of existing Strive offerings, leading to an increase in investment advisory fees of $2.0 million, coupled with additional Strive fund offerings launched in 2024 and 2025.

Other revenue

Other revenue remained at less than $0.1 million during all periods.

Fund management and administration

Fund management and administration expense increased by $1.3 million, or 25.7%, to $6.1 million ($1.9 million for the period from September 12, 2025 to December 31, 2025 and $4.3 million for the period from January 1, 2025 to September 11, 2025) from $4.9 million for the year ended December 31, 2024.

This increase was primarily due to expansion in average AUM held within previously launched Strive funds, which led to a $1.0 million increase, as well as additional Strive fund offerings launched in 2024 and 2025.

Employee compensation and benefits

Employee compensation and benefits expense increased by $25.7 million, or 281.6%, to $34.9 million ($27.6 million for the period from September 12, 2025 to December 31, 2025 and $7.2 million for the period from January 1, 2025 to September 11, 2025) from $9.1 million for the year ended December 31, 2024.

This increase was primarily a result of stock compensation expense recorded during the period from September 12, 2025 to December 31, 2025 of $21.7 million, which was largely the result of the achievement of the liquidity event performance condition, which gave rise to a one-time catch up of previously time-vested awards.

This was paired with bonuses paid to certain employees in 2025 concurrent with the close of the Asset Entities Merger and an increase in the average headcount in 2025 compared to 2024.

General and administrative expense

General and administrative expense decreased by $3.3 million, or (29.7)%, to $7.9 million ($3.7 million for the period from September 12, 2025 to December 31, 2025 and $4.2 million for the period from January 1, 2025 to September 11, 2025) from $11.2 million for the year ended December 31, 2024.

This decrease was primarily due to a decrease in legal and consulting expenses of $4.8 million related to the launch of the wealth management business line in late 2024, regulatory compliance consultations, general counsel representation and various legal matters throughout 2024, which was partially offset by increases in accounting and insurance expenses of $1.3 million as a result of the Asset Entities Merger and various capital markets transactions in 2025.

Marketing and advertising

Marketing and advertising expense decreased by $0.5 million, or (55.7)%, to $0.4 million ($0.2 million for the period from September 12, 2025 to December 31, 2025 and $0.2 million for the period from January 1, 2025 to September 11, 2025) from $0.9 million for the year ended December 31, 2024.

This decrease was primarily due to additional marketing consulting and advertising services as a result of additional public relations efforts throughout 2024.

Depreciation and amortization

Depreciation and amortization increased by less than $0.1 million, or 14.6%, to $0.2 million ($0.1 million for the period from September 12, 2025 to December 31, 2025 and $0.1 million for the period from January 1, 2025 to September 11, 2025) from $0.2 million for the year ended December 31, 2024.

This increase was due to purchases of property, plant, and equipment during 2024.

Net unrealized loss on digital assets, at fair value

Net unrealized loss on digital assets, at fair value increased by $194.5 million, or (100.0)%, to $194.5 million for the period from September 12, 2025 to December 31, 2025.

The Company did not hold any digital assets during periods prior to September 12, 2025.

Other derivative loss

Other derivative loss increased by $14.7 million, or (100.0)%, to $14.7 million for the period from September 12, 2025 to December 31, 2025, which was driven by the market price of the Company's Class A Common Stock being higher than the price agreed-upon as part of the exchange of bitcoin for Class A common shares at the exchange date.

Other income increased by $0.5 million, or 64.7%, to $1.3 million ($0.7 million for the period from September 12, 2025 to December 31, 2025 and $0.6 million for the period from January 1, 2025 to September 11, 2025) from $0.8 million for the year ended December 31, 2024.

This increase was due to an increase in the average level of holdings of interest-bearing assets during 2025 as compared to 2024.

Transaction costs

Transaction costs increased by $28.1 million, or (100.0)%, to $28.1 million ($12.4 million for the period from September 12, 2025 to December 31, 2025 and $15.7 million for the period from January 1, 2025 to September 11, 2025) from no transaction costs for the year ended December 31, 2024.

This increase was primarily due to accounting and legal costs

incurred related to the Asset Entities Merger and the recently consummated Semler Scientific Merger, which did not occur during the year ended December 31, 2024.

Gain on lease remeasurement

Gain on lease remeasurement decreased by $0.3 million, or (100.0)%.

There was a $0.3 million gain on lease remeasurement during the year ended December 31, 2024 due to the relocation from Dublin, Ohio to Dallas, Texas in late 2024, which resulted in a reduction of the expected remaining lease term for the office space in Dublin, Ohio.

There were no such events during the period from September 12, 2025 to December 31, 2025 or the period from January 1, 2025 to September 11, 2025.

Goodwill and intangible asset impairment

Goodwill and intangible asset impairment increased by $140.8 million, or (100.0)%, to $140.8 million for the period from September 12, 2025 to December 31, 2025.

The Company performed an impairment assessment of goodwill and intangible assets acquired as part of the Asset Entities Merger and determined that these assets were impaired.

No such impairments occurred during the year ended December 31, 2024 or the period from January 1, 2025 to September 11, 2025.

Dividends on preferred stock

Dividends on preferred stock increased by $4.3 million, or 100.0%, to $4.3 million for the period from September 12, 2025 to December 31, 2025.

The Company issued its SATA Stock during the period from September 12, 2025 to December 31, 2025 and declared dividends during such period.

No dividends were declared on the Predecessor's preferred stock during the year ended December 31, 2024 or the period from January 1, 2025 to September 11, 2025.

Liquidity and Capital Resources

of December 31, 2024, the Company had an accumulated deficit of $12,006,357 and cash balance of $2,660,624.

During the years ended

December 31, 2024 and 2023, we had a net loss of $6,393,932 and $4,931,197, respectively.

To date, the Company has financed its operations

primarily through capital raises and sales of its services.

In April 2024, the Company filed the Shelf Registration Statement, which

was declared effective by the SEC on April 26, 2024, for potential offerings of up to $100,000,000 in aggregate, subject to the requirement

that in no event may we sell shares having a value exceeding more than one-third of our public float in any 12-month period under the

Shelf Registration Statement so long as our public float remains below $75,000,000.

In May 2024, the Company completed the first of a

two-part private placement of its Series A Preferred Stock for gross proceeds of $1.5 million, and in July 2024, the Company completed

the second part of the private placement for an additional $1.5 million in gross proceeds.

In September 2024, the Company entered into

the ATM Sales Agreement, and filed a prospectus supplement to the Shelf Registration Statement for the ATM Financing for gross proceeds

of up to $1,791,704.

As of March 31, 2025, the Company has filed additional prospectus supplements to the Shelf Registration Statement

to increase the maximum gross proceeds to $5,489,399.

Since the commencement of the ATM Financing, a total of 5,417,700 shares has been

sold, for net proceeds to the Company of $4,830,647.56, after paying $329,362 in compensation to the Sales Agent and the same amount

to Boustead under the Boustead ATM Waiver.

The Company has received confirmation

from the investor in its Series A Preferred Stock that it will invest up to an additional $3 million upon request by the Company.

Based on the Company’s existing cash resources and the cash expected to be received

from the ATM Financing and other planned financings, it is expected that the Company will have sufficient funds to carry out the Company’s

planned operations through December 31, 2025 and for at least 12 months beyond that period.

We may, however, in the

future require additional cash resources due to changing business conditions, implementation of our strategy to expand our business, or

other investments or acquisitions we may decide to pursue.

If our own financial resources are insufficient to satisfy our capital requirements,

we may seek to sell additional equity or debt securities or obtain additional credit facilities.

The sale of additional equity securities

could result in dilution to our stockholders.

The incurrence of indebtedness would result in increased debt service obligations and could

require us to agree to operating and financial covenants that would restrict our operations.

Financing may not be available in amounts

or on terms acceptable to us, if at all.

Any failure by us to raise additional funds on terms favorable to us, or at all, could limit

our ability to expand our business operations and could harm our overall business prospects.

Summary of Cash Flow

The following table provides detailed information

about our net cash flow for the periods presented:

Years Ended December 31,

The following table summarizes Strive's available liquidity (in thousands):

December 31, 2025 December 31, 2024

(Successor) (Predecessor)

Cash and cash equivalents $ 67,499 $ 6,155

Short-term investments — 16,755

Digital assets, at fair value 668,486 —

Total liquidity $ 735,985 $ 22,910

Our principal sources of liquidity are cash and cash equivalents and short-term investments.

Cash and cash equivalents may include holdings in bank demand deposits, money market investments, and certificates of deposit.

Strive considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Short-term investments consist of U.S.

Treasury Bills that have a maturity exceeding three months and less than 12 months at the time of purchase.

Strive classifies short-term investments as held-to-maturity based on Strive’s intent and ability to hold these investments until maturity.

The Company decreased holdings of short-term investments period-over-period, instead holding in cash and cash equivalents, to meet commitments from recent transactions and to opportunistically invest in bitcoin and bitcoin-related investments.

Although the Company holds significant investments in bitcoin, all of which are unencumbered, the Company's intention is to hold these assets and not liquidate any such investments for working capital needs.

Management believes that Strive's liquidity position puts the Company in a position of strategic advantage to execute on strategic initiatives and meet working capital needs for at least the next twelve months.

Capital resources

On May 26, 2025, Asset Entities Inc.

and Strive Enterprises, Inc., entered into subscription agreements with certain accredited investors (the "PIPE Subscribers" and the transactions collectively, the "PIPE Transactions"), pursuant to which the PIPE Subscribers agreed to purchase, and the Company agreed to sell, the Company's Class A Common Stock at a price of $1.35 per share ($27.00 on a split-adjusted basis), with certain PIPE Subscribers agreeing to purchase pre-funded warrants (the "PIPE Pre-Funded Warrants") to purchase shares of Class A Common Stock at a price of $1.3499 ($26.9980 on a split-adjusted basis) in lieu of Class A common shares.

Each PIPE Pre-Funded Warrant gives the holder the right to purchase a share of Class A Common Stock (1/20th of a share of Class A Common Stock on a split-adjusted basis) at an exercise price of $0.0001 per share ($0.0020 on a split-adjusted basis).

For each share of Class A Common Stock and PIPE Pre-Funded Warrant purchased, the holder received a traditional warrant (the "PIPE Traditional Warrants"), which gives

the holder the right to purchase a share of Class A Common Stock (1/20th of a share of Class A Common Stock on a split-adjusted basis) at an exercise price of $1.35 per share ($27.00 on a split-adjusted basis).

On September 12, 2025, the Company consummated the PIPE Transactions, pursuant to which it issued 345.5 million shares (17.3 million on a split-adjusted basis) of Class A Common Stock, 209.8 million PIPE Pre-Funded Warrants to purchase 10.5 million shares of Class A Common Stock (on a split-adjusted basis), and 555.3 million PIPE Traditional Warrants to purchase 27.8 million shares of Class A Common Stock (on a split-adjusted basis), and received gross proceeds of $749.6 million, with the ability to raise $749.6 million in additional gross proceeds upon the exercise of such warrants.

Each PIPE Pre-Funded Warrant became immediately exercisable upon issuance, and will be exercisable until each PIPE Pre-Funded Warrant is exercised in full.

Each PIPE Traditional Warrant became immediately exercisable upon issuance, and will expire on the first anniversary of the effectiveness date of the registration statement covering the resale of the securities issued in the PIPE Transactions.

On September 15, 2025, the Company entered into the ASST Sales Agreement with the ASST Sales Agent, pursuant to which the Company, from time to time, at its option, may offer and sell shares of its Class A Common Stock to or through the ASST Sales Agent, acting as the principal and/or the sole agent, having an aggregate sales price of up to $450.0 million.

As of December 31, 2025, the Company has the availability to raise approximately $371.3 million through the issuance and sale of its Class A Common Stock pursuant to the ASST Sales Agreement.

On September 15, 2025, the Company's board of directors authorized the purchase of up to $500.0 million of its Class A Common Stock through a share repurchase program.

Repurchases may be made from time-to-time, subject to general business and market conditions, other investment opportunities, and applicable legal requirements.

Repurchases may be made through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans.

During the period from September 12, 2025 to December 31, 2025, the Company did not repurchase any Class A Common Stock.

As of December 31, 2025, $500.0 million of Class A Common Stock remains available for repurchase through the share repurchase program.

On November 10, 2025, the Company issued 2,000,000 shares of SATA Stock in an initial public offering registered under the Securities Act.

The Company received approximately $148.4 million of net proceeds, after deducting the underwriting discounts and commissions and offering expenses, from the issuance of SATA Stock in the initial public offering of SATA Stock.

On December 9, 2025, the Company entered into the SATA Sales Agreement with the SATA Sales Agents, pursuant to which the Company, from time to time, at its option, may offer and sell shares of its SATA Stock to or through the SATA Sales Agents, acting as the principal and/or agent, having an aggregate sales price of up to $500.0 million.

During the period from September 12, 2025 to December 31, 2025, the Company issued 13 thousand shares of SATA Stock for aggregate gross proceeds of $1.2 million.

As of December 31, 2025, the Company has the availability to raise approximately $498.8 million through the issuance and sale of its SATA Stock pursuant to the SATA Sales Agreement.

On January 27, 2026, the Company issued 1,320,000 shares of SATA Stock in a public follow-on offering registered under the Securities Act.

On January 22, 2026, the Company entered into separate, privately negotiated exchange agreements with certain holders of the 4.25% Convertible Senior Notes due 2030 assumed through the Semler Scientific Merger (the "Semler Convertible Notes"), representing $90.0 million aggregate principal amount of the Semler Convertible Notes, pursuant to which such holders exchanged their Semler Convertible Notes for approximately 929,999 newly issued shares of SATA Stock concurrent with the closing of the Follow-On Offering.

As of January 27, 2026, and following the settlement of the Notes Exchange, $10.0 million aggregate principal amount of the Semler Convertible Notes remained outstanding.

Contractual and Other Obligations

As of December 31, 2025, our material contractual obligations and commitments primarily include operating leases and employee compensation agreements.

Strive did not have any long-term debt or other long-term liabilities as of December 31, 2025.

Strive maintains operating leases for its office locations in Dallas, Texas and Dublin, Ohio.

In May 2025, Strive entered into an agreement to sub-lease the Dublin, Ohio office location to a third-party for substantially the same terms as Strive’s lease.

As of December 31, 2025, Strive had operating lease payment obligations of approximately $5.4 million, of which $0.7 million is payable within 12 months.

Of these amounts, $2.3 million of the future lease obligations, $0.3 million of

which is due within 12 months, relate to amounts that will be recovered through lease payments from our sub-tenant for the Dublin, Ohio lease.

The following table summarizes Strive's cash flow activities (in thousands):

Successor Predecessor

Period from September 12, 2025 to December 31, 2025 Period from January 1, 2025 to September 11, 2025 Year Ended December 31, 2024

Net cash used in operating activities $ (24,976) $ (18,209) $ (21,595)

$ (4,900,057 )

$ (3,807,623 )

Net cash used in investing activities

Net cash provided by financing activities

Net change in cash

Cash at beginning of year

Cash at end of year

Net cash used in operating activities was approximately

$ 4.9 million for the fiscal year ended December 31, 2024, as compared to net cash used

in operating activities of approximately $3.8 million for the fiscal year ended December 31, 2023.

This increase was primarily due to

an increase in net loss.

Net cash used in investing activities was $ 0.4

million for the fiscal year ended December 31, 2024, as compared to net cash used in operating activities of approximately $0.1 for the

fiscal year ended December 31, 2023.

The change was primarily due to the purchase of intangible

assets during the fiscal year ended December 31, 2024 compared to a lesser amount of such

purchases during the fiscal year ended December 31, 2023.

Net cash provided by financing activities was

approximately $5.0 million for the fiscal year ended December 31, 2024, as compared to net cash provided by financing activities of

approximately $6.7 million for the fiscal year ended December 31, 2023.

The change was primarily due to the reduced amount of proceeds

from the Company’s private placements during the fiscal year ended December 31, 2024 compared to the proceeds received from its

February 2023 initial public offering.

Initial Public

Offering and Underwriting Agreement

The closing of our initial public offering took

place on February 7, 2023 pursuant to the Underwriting Agreement.

At the closing, the Company sold 300,000 shares of Class B Common Stock

for total gross proceeds of $7,500,000.

The Company also issued the Representative’s Warrant.

deducting the underwriting discounts, commissions, non-accountable expense allowance, and other expenses from the initial public offering,

the Company received net proceeds of approximately $6.6

Pursuant to the Underwriting Agreement, as of

February 3, 2023, we were subject to a lock-up agreement that prevented us, subject to certain exceptions, from selling or transferring

any of our shares of capital stock of the Company for up to 12 months.

In addition, our officers, directors and beneficial owners of approximately

78.0% of our common stock agreed to be locked up for a period of 12 months.

Holders of approximately 7.2% of our outstanding common stock

agreed to be locked up for a period of nine months, and a holder of approximately 2.3% of our outstanding Class B Common Stock prior to

the initial public offering agreed to be locked up for a period of six months with respect to approximately 0.9% of the outstanding common

stock held by such holder, subject to certain exceptions.

The remaining shares were not subject to lock-up provisions or such lock-up

provisions were waived.

This lock-up period expired on February 2, 2024.

As stated in the IPO Public Offering Prospectus,

the Company intended to use the net proceeds from the initial public offering for investment in corporate infrastructure, marketing and

promotion of Discord communities, social campaigns, and the Company’s “AE.360.DDM” Discord design, development and management

service, expansion of “SiN”, the Company’s social influencer network, increasing staff and company personnel, and general

working capital, operating, and other corporate expenses.

The following is our

reasonable estimate of the uses of the proceeds from the Company’s initial public offering from the date of the closing of the offering

on November 16, 2023 until December 31, 2024:

● None was used for construction of plant, building and facilities;

● None was used for the purchase and installation of machinery and equipment;

● None was used for purchases of real estate;

● Approximately $0.3 million was used for the acquisition of assets of other businesses;

● None was used for the repayment of indebtedness;

● Approximately $6.3 million was used for working capital;

● None was used for temporary investments.

As of December 31, 2024,

none of the proceeds from the initial public offering were used to make direct or indirect payments to any of our directors or officers,

any of their associates, any persons owning 10% or more of any class of our equity securities, or any of our affiliates, or direct or

indirect payments to any others other than for the direct costs of the offering.

There has not been, and

we do not expect, any material change in the planned use of proceeds from the initial public offering as described in the IPO Registration

Engagement Letter

and Underwriting Agreement with Boustead Securities, LLC

Under the engagement letter agreement, dated November

29, 2021, between the Company and Boustead (the “Boustead Engagement Letter”), during the term that began on November 29,

2021 and ending 12 months following the termination or expiration of the Boustead Engagement letter, which occurred on February 7, 2024

(see below), we were required to compensate Boustead with a cash fee equal to seven percent (7.0%)

and non-accountable expense allowance equal to one percent (1.0%) of the gross proceeds received by the Company from the sale of securities

in an investment transaction, or up to ten percent (10.0%) of the gross proceeds from certain other merger, acquisition, or joint venture,

strategic alliance, license, research and development, or other similar transactions, with a party, including any investor in a private

placement in which Boustead served as placement agent or in the initial public offering, or who became aware of the Company or who became

known to the Company prior to the termination or expiration of the Boustead Engagement Letter, including any Company officers, directors,

employees, consultants, advisors, stockholders, members, or partners, for such transactions that occurred during the 12-month period following

the termination or expiration of the Boustead Engagement Letter (the “Tail Rights”).

The Boustead Engagement Letter

expired on February 7, 2024.

The Tail Rights therefore expired on February 7, 2025.

Pursuant to the Underwriting

Agreement, the Company granted Boustead an irrevocable right of first refusal until February 2, 2025, to act as financial advisor, lead

managing underwriter, book runner, placement agent, or to act as joint advisor, managing underwriter, book runner, or placement agent

on at least equal economic terms, on any public or private financing (debt or equity), merger, business combination, recapitalization

or sale of some or all of the equity or assets of the Company.

This right of first refusal expired on February 7, 2025.

October 2023 and April 2024 Private Placements

with Triton Funds LP

Sales to Triton Funds

Under a Closing Agreement,

dated as of June 30, 2023 (the “Triton Closing Agreement”), between the Company and Triton Funds LP, a Delaware limited partnership

(“Triton”), the Company agreed to sell to Triton, at its option, shares of Class B Common Stock having an aggregate value

of $1,000,000 (“Triton Shares”), pursuant to a registration statement to be filed and made effective for the resale of the

Triton Shares.

Subject to the terms of the Triton Closing Agreement, the Company was provided a right to deliver a closing notice (the

“Triton Closing Notice”) and issue the Triton Shares to Triton at any time before September 30, 2023, pursuant to which Triton

had agreed to purchase the Triton Shares for $1,000,000 before deducting a $25,000 administrative fee.

The price of each of the Triton

Shares was agreed 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 Triton Shares (the “Triton Closing”).

The Triton Closing was required to occur

within five business days after the Triton Shares were received by Triton.

Triton’s obligation to purchase the Triton Shares was

conditioned on the effectiveness of a registration statement covering the resale of the Triton Shares and Triton’s ownership not

exceeding 9.99% of the Class B Common Stock outstanding as of June 30, 2023.

The Triton Closing Agreement

contained additional requirements, including that the Company maintain the listing of the Class B Common Stock on the primary market on

which the Class B Common Stock is listed and provide notice to Triton of certain events affecting registration or that may suspend its

right to submit the Triton Closing Notice.

The Company also agreed to provide indemnification against liabilities relating to misrepresentations,

breaches of obligations, and third-party claims relating to the Triton Closing Agreement, with certain exceptions.

The Triton Closing

Agreement provided that it would expire either upon the Triton Closing or September 30, 2023.

Under an Amended and

Restated Closing Agreement, dated as of August 1, 2023, between the Company and Triton (the “Triton Amended and Restated Closing

Agreement”), the Closing Agreement was amended and restated to provide that, subject to its terms and conditions, the Company may

deliver a Triton Closing Notice and issue certain securities to Triton at any time on or before September 30, 2023, pursuant to which

Triton would be required to purchase such securities of the Company with an aggregate gross purchase price of $1,000,000 in the following

Upon delivery of a Triton Closing Notice and the issuance and delivery of securities as described below, Triton would purchase

Triton Shares in an amount equal to up to 9.99% of the outstanding shares of Class B Common Stock following such purchase, pre-funded

warrants (“Triton Pre-Funded Warrants” and together with Triton Shares, “Triton Securities”) that may be exercised

to purchase an amount of newly-issued shares of Class B Common Stock (“Triton Warrant Shares”), or both Triton Shares and

Triton Pre-Funded Warrants, such that the aggregate price of the Triton Shares and the Triton Pre-Funded Warrants together with the exercise

price to be paid upon full exercise of the Triton Pre-Funded Warrants was required to equal a total gross purchase price of $1,000,000.

Any proceeds under the Triton Amended and Restated Closing Agreement must be reduced by a $25,000 administrative fee.

The Triton Amended

and Restated Closing Agreement also provided that it would expire either upon the date that Triton paid the required purchase price after

receiving a Triton Closing Notice, or September 30, 2023.

The terms of the price of the Triton Securities and the required date of the

Triton Closing were not amended, except that if Triton elected to purchase Triton Pre-Funded Warrants in lieu of Triton Shares, then the

purchase price per Triton Pre-Funded Warrant acquired would be reduced by $0.01 with such $0.01 being the exercise price of the Triton

Pre-Funded Warrant.

The Triton Amended and

Restated Closing Agreement provided that Triton’s obligation to purchase the Triton Securities was subject to certain conditions.

These conditions included the filing and effectiveness of the required registration statement for the resale of the Triton Securities.

In addition, the Class B Common Stock was required to remain listed on The Nasdaq Capital Market tier of Nasdaq, and the issuance of the

Triton Securities was required to not violate any requirements of Nasdaq.

Triton’s purchase requirement was also subject to provisions

that prevented Triton from acquiring shares of Class B Common Stock at the time of any sale of the Triton Securities or exercise of the

Triton Pre-Funded Warrants that would result in the number of shares beneficially owned by Triton and its affiliates exceeding 9.99% of

the total number of shares of Class B Common Stock outstanding immediately after giving effect to the issuance of the shares under the

Triton Amended and Restated Closing Agreement or the Triton Pre-Funded Warrants (the “Triton Beneficial Ownership Limitation”).

The Triton Amended and Restated Closing Agreement provided for the issuance of the Triton Pre-Funded Warrants in lieu of issuance of some

or all the Triton Shares, with an exercise price of $0.01 per share and with no expiration date, if, in Triton’s sole discretion,

it would otherwise exceed the Triton Beneficial Ownership Limitation, or otherwise upon Triton’s election.

For each of the Triton

Shares that Triton instead elected to be issuable as Triton Warrant Shares, the number of Triton Shares that we were required to issue

to Triton at the time of any sale of the Triton Securities was required to be decreased on a one-for-one basis.

We were also required

to provide indemnification against liabilities relating to misrepresentations, breaches of obligations, and third-party claims relating

to the Triton Amended and Restated Closing Agreement, with certain exceptions.

On August 18, 2023, the

Company filed a Registration Statement on Form S-1 (File No.

333-274079) to register the offer and sale of the Triton Securities in an

amount of up to 177,000 shares of Class B Common Stock consisting of Triton Shares and Triton Warrant Shares, as well as other securities.

The registration statement was declared effective by the SEC on September 6, 2023.

Under an Amendment to

Triton Amended and Restated Closing Agreement (the “First Triton Amendment”), dated as of September 27, 2023, the Company

and Triton agreed to amend the Triton Amended and Restated Closing Agreement (as amended, the “Amended A&R Closing Agreement”)

to provide that the Amended A&R Closing Agreement would expire on December 30, 2023 instead of September 30, 2023;

to provide that

up to an aggregate value of $1,000,000 of the Class B Common Stock, based on the purchase price formula described above, may be sold and

purchased pursuant to a Triton Closing Notice;

and to amend the form of Triton Closing Notice to provide for a specific number of shares

that may be sold to Triton under the Amended A&R Closing Agreement.

The First Triton Amendment did not amend any of the other provisions

of the Triton Amended and Restated Closing Agreement.

As an incentive to Triton

to enter into the First Triton Amendment and agree to the extension of the term under the Amended A&R Closing Agreement to December

30, 2023, the Company indicated to Triton that it would deliver a Triton Closing Notice under the Amended A&R Closing Agreement to

sell a number of shares of Class B Common Stock equal to approximately 4.9% of the outstanding shares of Class B Common Stock prior to

Therefore, on September 29, 2023, under the Amended A&R Closing Agreement, the Company delivered a Triton Closing Notice

to Triton (the “First Triton Closing Notice”) for the purchase of 52,682 Triton Shares (the “First Triton Shares”),

which was the amount of shares of Class B Common Stock equal to approximately 4.9% of the shares of Class B Common Stock outstanding on

Pursuant to the Amended A&R Closing Agreement, the closing date for this purchase was required to take place within five

business days after the Triton Shares were delivered to Triton.

On the date of this Triton Closing (the “First Triton Closing”),

Triton was required to pay the Company a purchase price per share equal to 85% of the lowest daily volume-weighted average price of the

Class B Common Stock during the five business days prior to the date of the First Triton Closing, the proceeds of which would be reduced

by the $25,000 administrative fee, in accordance with the terms of the Amended A&R Closing Agreement.

On October 4, 2023, the

First Triton Shares were received by Triton.

Pursuant to the Amended A&R Closing Agreement, on the fifth business day following the

day that the First Triton Shares were received, Triton was required to pay the Company approximately $45,841, based on a price per share

of $1.3447, equal to 85% of $1.582, the lowest daily volume-weighted average price of the Class B Common Stock during the five-business-day

period ending October 11, 2023, less the $25,000 administrative fee.

The Company received payment of this amount on October 13, 2023.

Under a Second Amendment

to Triton Amended and Restated Closing Agreement (the “Second Triton Amendment”), dated as of December 30, 2023, the Company

and Triton agreed to amend the Amended A&R Closing Agreement to provide that the Amended A&R Closing Agreement would expire on

March 31, 2024, instead of December 30, 2023.

The Second Triton Amendment did not amend any of the other provisions of the Amended A&R

Closing Agreement.

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 would 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.

Pursuant to the Amended

A&R Closing Agreement, as amended by each of the Second Triton Amendment and the Third Triton Amendment, on March 27, 2024, the Company

delivered a Triton Closing Notice to Triton informing Triton that the Company had elected to exercise its right to sell Triton 124,318

Triton Shares (the “Second Triton Shares”).

The price of each of the Second Triton 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 Triton Closing for the sale

of the Second Triton Shares (the “Second Triton Closing”), and the Second Triton Closing was required to occur within five

business days after the date that the Second Triton Shares were received by Triton.

On April 10, 2024, the

date of the Second Triton Closing, the price of the Second 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 Second Triton Closing.

2024, the Company received gross proceeds of $211,341.

Compensation to Boustead

Securities, LLC

In connection with the

First Triton Closing, pursuant to the Boustead Engagement Letter and the Underwriting Agreement, the Company was required to pay Boustead

a fee equal to 7% of the aggregate purchase price, and non-accountable expense allowance equal to 1% of the aggregate purchase price for

the First Triton Shares.

In addition, the Company issued a warrant to Boustead for the purchase of 3,688 shares of Class B Common Stock,

equal to 7% of the number of the First Triton Shares, with an exercise price of $1.3447 per share, subject to adjustment, a five-year

term, and cashless exercise and registration rights.

In connection with the

Second Triton Closing, pursuant to the Boustead Engagement Letter and the Underwriting Agreement, the Company paid Boustead, as placement

agent compensation, 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 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 Second Triton Shares, with an exercise price of $1.70 per share, subject to adjustment,

a five-year term, and cashless exercise and registration rights.

June 2024 TommyBoyTV

Asset Purchase Agreement

Under an Asset Purchase

Agreement (the “TBTV Asset Purchase Agreement”), dated as of June 21, 2024, among the Company, TommyBoyTV, LLC (the “TBTV

Seller”), and Tomas Cvercko, the owner of all of the membership interests of the TBTV Seller (the “TBTV Member”), the

Company agreed to purchase all of the TBTV Seller’s right, title, and interest in and to substantially all of the assets and properties

owned by the TBTV 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 (the “TBTV Cash Consideration”) and the issuance of 5,000 shares of Class

B Common Stock (the “TBTV Stock Consideration”).

Pursuant to the TBTV

Asset Purchase Agreement, on June 21, 2024, the Company paid the TBTV Seller $200,000 and issued the TBTV Stock Consideration to the TBTV

Member, and the TBTV Seller and the TBTV Member delivered title to all of the assets of the TBTV Seller.

The TBTV Stock Consideration

vested immediately upon issuance.

Pursuant to the TBTV

Asset Purchase Agreement, the Company agreed to assume certain liabilities including the obligations, duties and liabilities with respect

to the contracts used in conducting or relating to the business of the TBTV Seller and other specified assets, in each case only to the

extent arising from and after June 21, 2024.

These assumed liabilities also exclude any obligations arising from the TBTV Seller’s

breach or default before June 21, 2024.

The TBTV 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 TBTV Seller and the TBTV Member with respect to certain damages with respect

to the assumed liabilities and certain other liabilities asserted by a third party arising after June 21, 2024.

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.

However, this threshold limitation does

not apply to claims by the Company for breaches by the TBTV Seller or the TBTV Member 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, consisting of the TBTV Cash Consideration.

Private Placements of Series A Preferred

Under the Ionic Purchase

Agreement, the Company agreed to the issuance and sale of up to 330 shares of the Company’s newly designated Series A Preferred

Stock for maximum gross proceeds of $3,000,000.

The shares of the Series A Preferred Stock are convertible into shares of Class B Common

Pursuant to the Ionic 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 Ionic 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.

closing (the “Second Ionic Closing”), for the issuance and sale of 165 shares of Series A Preferred Stock for gross proceeds

of $1,500,000, was required to occur on the first business day on which the conditions specified in the Ionic Purchase Agreement for the

Second Ionic Closing were satisfied or waived, including the filing and effectiveness of the First Registration Statement (as defined

below) and the effectiveness of the Stockholder Approval (as defined below).

On July 29, 2024, the conditions to the occurrence of the

Second Ionic Closing were met.

As a result, on July 29, 2024, the Company issued and sold 165 shares of Series A Preferred Stock to Ionic

for gross proceeds of $1,500,000.

Registration Rights

In connection with the Ionic Purchase Agreement,

the Company agreed to provide certain registration rights to Ionic, pursuant to the Registration Rights Agreement, dated as of May 24,

2024, between the Company and Ionic (the “Ionic Registration Rights Agreement”).

The Ionic Registration Rights Agreement provides

for the registration for resale of any and all shares of Class B Common Stock issuable to Ionic with respect to the shares of Series A

Preferred Stock under the Ionic Purchase Agreement (the “Registrable Conversion Shares”).

Within the later of 15 calendar

days of the First Ionic Closing or May 24, 2024, the Company was required to file a registration statement (the “First Registration

Statement”) for the offer and resale of the maximum number of Registrable Conversion Shares permitted to be covered in accordance

with applicable SEC rules, regulations and interpretations.

The First Registration Statement was required to be declared effective within

45 days of the First Ionic Closing, or 90 days if the First Registration Statement received a review.

Pursuant to these requirements,

a Registration Statement on Form S-1 (File No.

333-280020), was originally filed by the Company with the SEC on June 7, 2024, and as amended,

was filed to register the offer and resale of 385,894 shares of Class B Common Stock, which was considered the maximum number of

Registrable Conversion Shares permitted to be covered in accordance with applicable SEC rules, regulations and interpretations, and was

declared effective by the SEC on July 24, 2024.

Following the Second Ionic Closing, which occurred on July 29, 2024, for the issuance

and sale of an additional 165 shares of Series A Preferred Stock for gross proceeds of $1,500,000, the Company was required to file a

registration statement (the “Second Registration Statement”) within 45 days of the Second Ionic Closing for the offer and

resale of the maximum number of Registrable Conversion Shares permitted to be covered in accordance with applicable SEC rules, regulations

and interpretations.

The Second Registration Statement was required to be declared effective within 45 days of the Second Ionic Closing,

or 90 days if the Second Registration Statement received a review.

Pursuant to these requirements, a Registration Statement on Form S-1

333-281438), was originally filed by the Company with the SEC on August 9, 2024, and as amended, was filed to register the offer

and resale of 482,120 shares of Class B Common Stock, which was considered the maximum number of Registrable Conversion Shares permitted

to be covered in accordance with applicable SEC rules, regulations and interpretations, and was declared effective by the SEC on September

In the event the number

of shares of Class B Common Stock available under the First Registration Statement and the Second Registration Statement is insufficient

to cover all of the Registrable Conversion Shares, the Company will be required to file at least one additional registration statement

(each of such additional registration statement, the First Registration Statement, and the Second Registration Statement, and collectively,

the “Registration Statement”) within 14 days of the date that the necessity arises and that such additional Registration Statement

may be filed under SEC rules to cover such Registrable Conversion Shares up to the maximum permitted to be covered under SEC rules, which

must be made effective within 45 days of such date, or 90 days if such additional Registration Statement receives a review.

to meet the filing deadline for either the First Registration Statement or the Second Registration Statement (“Filing Failure”)

would have resulted in liquidated damages of 20,000 shares of Class B Common Stock.

Any failure to meet the effectiveness deadline for

any Registration Statement (“Effectiveness Failure”) will result in liquidated damages of 20,000 shares of Class B Common

Each of the shares issuable upon a Filing Failure or an Effectiveness Failure must also be covered by a Registration Statement

to the same extent as the Registrable Conversion Shares.

The Company will be required to use its best efforts to keep each Registration

Statement effective until all such shares of Class B Common Stock are sold or may be sold without restriction pursuant to Rule 144 under

the Securities Act (“Rule 144”), and without the requirement for us to be in compliance with the current public information

requirement under Rule 144.

Terms of Series A

Convertible Preferred Stock under Certificate of Designation and Securities Purchase Agreement

Pursuant to the Ionic

Purchase Agreement, on May 24, 2024, the Company filed a Certificate of Designation of Series A Convertible Preferred Stock of the Company

with the Secretary of State of the State of Nevada (the “Initial Certificate of Designation”), as amended by the Certificate

of Amendment to Designation (the “First Designation Amendment”) filed with the Secretary of State of the State of Nevada on

June 14, 2024, as amended by the Certificate of Amendment to Designation (the “Second Designation Amendment”) filed with the

Secretary of State of the State of Nevada on September 4, 2024 at 9:58 AM Pacific Daylight Time, as amended by the Certificate of Amendment

to Designation (the “Third Designation Amendment”) filed with the Secretary of State of the State of Nevada on September 4,

2024 at 11:38 AM Pacific Daylight Time (as amended, the “Series A Certificate of Designation”), designating 660 shares of

the Company’s preferred stock as “Series A Convertible Preferred Stock,” $0.0001 par value per share, and setting forth

the voting and other powers, preferences and relative, participating, optional or other rights of the Series A Preferred Stock.

of Series A Preferred Stock has an initial stated value (“Stated Value”) of $10,000 per share.

The Series A Preferred

Stock ranks senior to all other capital stock of the Company with respect to the payment of dividends, distributions and payments upon

the liquidation, dissolution and winding up 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 at the Company’s option) on the

Stated Value at an annual rate of 6% (which will increase to 12% if a Triggering Event (as defined in the Series A Certificate of Designation)

occurs until such Triggering Event, if curable, is cured).

Dividends will be payable upon conversion or redemption of the Series A Preferred

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 of such shares (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 $3.75, 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 of the lowest daily

volume weighed average price of the Class B Common Stock during the Alternate Conversion Measuring Period (as defined in the Series A

Certificate of Designation).

A holder of Series A

Preferred Stock may not convert the Series A Preferred Stock into Class B Common Stock to the extent that such conversion would cause

such holder’s beneficial ownership of Class B Common Stock to exceed 4.99% of the outstanding Class B Common Stock immediately after

conversion, which may be increased by the holder to up to 9.99% upon no fewer than 61 days’ prior notice (the “Series A Beneficial

Ownership Limitation”).

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 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, and subject to the holder’s compliance with other applicable procedural

requirements for conversion.

Holders of Series A Preferred Stock are not prohibited from delivering a Conversion Notice (as defined by

the Series A Certificate of Designation) while another Conversion Notice remains outstanding.

The Series A Certificate

of Designation provides that the Conversion Price may not be lower than a floor price (the “Floor Price”) of $0.4275 per share,

subject to adjustment for stock splits and similar transactions.

If the Conversion Price would be less than the Floor Price, then, subject

to the terms and conditions of the Series A Certificate of Designation, the Stated Value will automatically increase in the manner provided

pursuant to the Series A Certificate of Designation, as described in the following paragraph.

The Series A Preferred Stock also may not

be converted except to the extent that the shares of Class B Common Stock issuable upon such conversion may be resold pursuant to Rule

144 or an effective and available registration statement.

If a conversion of Series

A Preferred Stock would have resulted in the issuance of an amount of shares of Class B Common Stock exceeding 19.99% of the Company’s

common stock outstanding as of the date of the signing of the related binding agreement, which number of shares would be reduced, on a

share-for-share basis, by the number of shares of common stock issued or issuable pursuant to any transaction or series of transactions

that may be aggregated with the transactions contemplated by the Series A Certificate of Designation under applicable rules of Nasdaq,

including Nasdaq Listing Rule 5635(d) (such amount, the “Exchange Limitation”), the Conversion Price would have been required

to be at least equal to the price (the “Minimum Price”) that would be the lower of the last closing price of the stock immediately

preceding the signing of the related binding agreement and the average closing price for the five Trading Days (as defined below) immediately

preceding the signing of the related binding agreement, before the effectiveness of the approval of such number of the holders of the

outstanding shares of the Company’s voting securities as required by the Bylaws of the Company (the “Bylaws”) and the

NRS, to ratify and approve all of the transactions contemplated by the Transaction Documents (as defined in the Ionic Purchase Agreement),

including the issuance of all of the shares of Series A Preferred Stock and shares of Class B Common Stock upon conversion of the shares

of Series A Preferred Stock, all as may be required by the applicable rules and regulations of The Nasdaq Capital Market tier of Nasdaq

(or any successor entity) (the “Stockholder Approval”).

In the event that the Conversion Price on a Conversion Date (as defined

in the Series A Certificate of Designation) would have been less than the applicable Minimum Price or the Floor Price if not for the immediately

preceding sentence, then, upon any conversion of shares of Series A Preferred Stock, the Stated Value will automatically be increased

by an amount equal to the product obtained by multiplying (A) the higher of (I) the highest price that the Class B Common Stock trades

at on the Trading Day immediately preceding the Conversion Date and (II) the applicable Conversion Price and (B) the difference obtained

by subtracting (I) the number of shares of Class B Common Stock delivered (or to be delivered) to the holder on the applicable Conversion

Date with respect to such conversion of shares of Series A Preferred Stock from (II) the quotient obtained by dividing (x) the Stated

Value (plus any accrued but unpaid dividends and other amounts due on such shares) of the Series A Preferred Stock being converted that

the holder has elected to be the subject of the applicable conversion, by (y) the applicable Conversion Price.

The Ionic Purchase Agreement

required that the Company obtain the Stockholder Approval, by the prior written consent of the requisite stockholders as required by the

Bylaws and the NRS, to ratify and approve all of the transactions contemplated by the Transaction Documents, including the issuance of

all of the shares of Series A Preferred Stock and shares of Class B Common Stock issuable upon conversion of such shares pursuant to the

Ionic Purchase Agreement, all as may be required by the applicable rules and regulations of The Nasdaq Capital Market tier of Nasdaq (or

any successor entity).

The Ionic Purchase Agreement and the Series A Certificate of Designation further required that the Company file

a Preliminary Information Statement on Schedule 14C with the SEC within 10 days of the date of the First Ionic Closing followed by the

filing of a Definitive Information Statement on Schedule 14C with the SEC within 20 days of the date of the First Ionic Closing, or within

45 days of the date of the First Ionic Closing if delayed due to a court or regulatory agency, including but not limited to the SEC, which

was required to disclose the Stockholder Approval.

In accordance with the rules of the SEC, the Stockholder Approval was required to become

effective 20 days after the Definitive Information Statement was sent or given in accordance with SEC rules.

In accordance with the

requirements and provisions described above, on May 24, 2024, the Company obtained the execution of a written consent in lieu of a special

meeting of a majority of the voting power of the stockholders of the Company approving a resolution approving the issuance of Class B

Common Stock in aggregate in excess of the limitations provided by Nasdaq Listing Rule 5635(d), including that an amount of shares of

Class B Common Stock equal to or greater than 20% of the total common stock or voting power outstanding on the date of the Series A Certificate

of Designation may be issued pursuant to the Series A Certificate of Designation at a price that may be less than the Minimum Price.

May 31, 2024, the Company filed a Preliminary Information Statement on Schedule 14C with the SEC.

On June 13, 2024, the Company filed

a Definitive Information Statement on Schedule 14C with the SEC disclosing such written consent.

As of the 20 th day following

actions meeting these and other applicable requirements, the Company is permitted to issue more than the limited number of shares as defined

by the Exchange Limitation, at a Conversion Price that may be below the Minimum Price.

Under the Ionic Purchase

Agreement, if the closing price of the Class B Common Stock falls below $3.75 per share, the holder’s total sales of Class B Common

Stock will be restricted.

The holder may only sell either the greater of $25,000 per Trading Day or 15% of the daily trading volume of

the Class B Common Stock reported by Bloomberg, LP, until the closing price exceeds $3.75.

“Trading Day” is defined as a day

on which the principal trading market for the Class B Common Stock is open for trading for at least six hours.

In addition, while any

of the shares of Series A Preferred Stock are outstanding, if the closing price of the Class B Common Stock is equal to or less than $0.4275

per share for a period of ten consecutive Trading Days, then the Company will promptly take all corporate action necessary to authorize

a reverse stock split of the Class B Common Stock by a ratio equal to or greater than 300% of the quotient obtained by dividing $0.4275

by the lowest closing price of the Class B Common Stock during such ten-Trading Day period, including calling a special meeting of stockholders

to authorize such reverse stock split or obtaining written consent for such reverse stock split, and voting the management shares of the

Company in favor of such reverse stock split.

The Series A Preferred

Stock will automatically convert to Class B Common Stock upon the 24-month anniversary of the initial issuance date of the Series A Preferred

The Company will have

the right at any time to redeem all or any portion of the Series A Preferred Stock then outstanding at a price equal to 110% of the Stated

Value plus any accrued but unpaid dividends and other amounts due.

Holders of the Series

A Preferred Stock will generally have the right to vote on an as-converted basis with the Class B Common Stock, subject to the Series

A Beneficial Ownership Limitation.

Under the Ionic Purchase

Agreement, the Company generally may not sell securities in a financing transaction while Ionic beneficially owns any shares of Series

A Preferred Stock or common stock until the end of the 30-day period following the initial date of the effectiveness of each Registration

Statement or during any Alternate Conversion Measuring Period.

In addition, the Company may not file any other registration statement

or any offering statement under the Securities Act, other than a registration statement on Form S-8 or supplements or amendments to registration

statements that were filed and effective as of the date of the Ionic Purchase Agreement (solely to the extent necessary to keep such registration

statements effective and available and not with respect to any Subsequent Placement (as defined by the Ionic Purchase Agreement)), unless

each of the First Registration Statement and the Second Registration Statement is effective and the respective prospectuses are available

for use, or the outstanding shares of Series A Preferred Stock and underlying shares of Class B Common Stock may be resold without limitation

under Rule 144.

Additionally, the Company may not, directly or indirectly, redeem, or declare or pay any cash dividend or distribution

on, any securities of the Company without the prior express written consent of Ionic (other than as required by the Series A Certificate

of Designation).

Compensation to Boustead

Securities, LLC

In connection with each

of the First Ionic Closing and the Second Ionic Closing, pursuant to the Boustead Engagement Letter and the Underwriting Agreement, the

Company was required to 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 Series A Preferred Stock.

On the date of the First Ionic Closing, we therefore paid Boustead

a total amount of $120,000.

In addition, the Company was required to issue a warrant to Boustead 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 First Ionic Closing at the initial Conversion Price of $3.75 per share (the “May 2024 Boustead

On the date of the Second Ionic Closing, we paid Boustead a total amount of $120,000.

In addition, on the date of the

Second Ionic Closing, the Company was required to issue a warrant to Boustead 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 Ionic Closing at the initial Conversion Price of $3.75 per share (the “July 2024 Boustead Warrant”).

Pursuant to an Assignment

and Assumption Agreement, dated as of July 30, 2024, among Boustead, Sutter Securities, Inc., a registered broker-dealer and an affiliate

of Boustead (“Sutter”), and the Company (the “First July 2024 Boustead Warrant Assignment Agreement”), all of

the rights to the July 2024 Boustead Warrant were assigned by Boustead to Sutter.

Pursuant to an Assignment and Assumption Agreement,

dated as of July 30, 2024, among Sutter, Michael R.

Jacks (the “Warrant Assignee”), Boustead, and the Company (the “Second

July 2024 Boustead Warrant Assignment Agreement”), all of the rights to the July 2024 Boustead Warrant were assigned by Sutter to

the Warrant Assignee, a registered representative of Sutter.

Pursuant to the First July 2024 Boustead Warrant Assignment Agreement and

the Second July 2024 Boustead Warrant Assignment Agreement, the July 2024 Boustead Warrant was cancelled, and a warrant (the “July

2024 Assignee Warrant”) was issued to the Warrant Assignee.

The terms of the July 2024 Assignee Warrant are identical to those of

the July 2024 Boustead Warrant.

The May 2024 Boustead

Warrant and the July 2024 Assignee Warrant have an exercise price of $3.75 per share, subject to adjustment, five-year terms, and cashless

exercise and piggyback registration rights.

ATM Financing

ATM Sales Agreement

On September 27, 2024,

the Company entered into the ATM Sales Agreement with the Sales Agent.

Under the terms of the ATM Sales Agreement, 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, issue and sell through or to the Sales Agent, initially up to a maximum aggregate amount of $2,271,487 of shares of the Company’s

Class B Common Stock (the “ATM Shares”).

The issuance and sale of the ATM Shares to or through the Sales Agent from time to

time will be effected pursuant to the Shelf Registration Statement and the prospectus supplements filed by the Company with the SEC on

September 30, 2024 and November 18, 2024 relating to the offering of the ATM Shares and the accompanying base prospectus.

Pursuant to the ATM Sales

Agreement, the Company may issue and sell the ATM Shares from time to time through or to the Sales Agent, acting as sales agent or principal,

subject to the terms and conditions of the ATM Sales Agreement.

The Company may instruct the Sales Agent to make such sales, and the Sales

Agent, as agent, will use its commercially reasonable efforts to sell the ATM Shares within the parameters set forth in the Company’s

notice to sell, and subject to the satisfaction of the Company’s obligations as set forth in the ATM Sales Agreement.

will designate the parameters within which the ATM Shares must be sold, including at a minimum the number to be sold, the time period

during which sales are requested to be made, any limitation on the number of the ATM Shares that may be sold in any one trading day, and

any minimum price below which sales may not be made.

The Company has no obligation to sell, and the Sales Agent is not obligated to buy

or sell, any of the ATM Shares under the ATM Sales Agreement and may at any time suspend offers under the ATM Sales Agreement or terminate

the ATM Sales Agreement as provided for in the ATM Sales Agreement.

The offering of the ATM Shares pursuant to the related prospectus

supplements to the Shelf Registration Statement and the accompanying base prospectus will terminate upon the earlier of (i) the sale of

all of the ATM Shares pursuant to such prospectus supplements and accompanying base prospectus having an aggregate sales price of $2,271,487,

and (ii) the termination by the Company or the Sales Agent of the ATM Sales Agreement pursuant to its terms.

Notwithstanding anything

to the contrary in the ATM Sales Agreement, the Sales Agent may only sell the ATM Shares directly into the market at prevailing market

prices in ordinary brokerage transactions that are open to all market participants, and will not sell shares in privately negotiated transactions,

whether acting solely as an agent on behalf of the Company or on a principal basis if agreed by the Sales Agent and the Company.

Unless otherwise agreed

between the Company and the Sales Agent, settlement for sales of the ATM Shares will occur on the first trading day following the date

on which any sales are made.

Sales of the ATM Shares will be settled through the facilities of The Depository Trust Company or by such

other means as the Company and the Sales Agent may agree.

There is no arrangement for funds to be received in an escrow, trust or similar

The Company will pay

the Sales Agent a cash commission of 3.0% of the gross sales price of the ATM Shares sold by the Sales Agent pursuant to the ATM Sales

Pursuant to the terms of the ATM 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 ATM 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.

Each of the Company and

the Sales Agent has the right, by giving written notice as specified in the ATM Sales Agreement, to terminate the ATM Sales Agreement

in its sole discretion at any time upon five (5) days’ prior written notice.

The Sales Agent also has the right to terminate the

ATM Sales Agreement at any time in certain circumstances, including in the event of the occurrence of a material adverse change with respect

to the Company, the failure of the Company to perform its obligations under the ATM Sales Agreement, any failure to fulfill any condition

to the obligations of the Sales Agent under the ATM Sales Agreement, or any suspension or limitation of trading of the ATM Shares.

The ATM Sales Agreement

contains certain covenants, representations and warranties customary for an agreement of this type.

The Company agreed to provide indemnification

and contribution to the Sales Agent against certain liabilities, including liabilities under the Securities Act.

Waivers and Consents to ATM Financing

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, pursuant to which 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 equity

securities of up to $5 million (“Waived ATM Financing”) under the Ionic Purchase Agreement or the Series A Certificate of

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 Financing, 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 Financing, the announcement of a Waived ATM Financing, the issuance, offer, sale, or grant of any shares of Class B Common Stock relating

to a Waived ATM Financing, 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 Financing.

In addition, pursuant to the

Ionic ATM Waiver, Ionic waived any adjustment to the applicable Conversion Price, 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

Financing 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.

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 Boustead Engagement Letter and the Underwriting Agreement in relation to

a Waived ATM Financing.

Pursuant to the Boustead ATM Waiver, the Company may at any time enter into any agreement relating to a Waived

ATM Financing, 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 Financing, the announcement of a Waived ATM Financing, the issuance, offer, sale, or grant

of any shares of the Class B Common Stock relating to a Waived ATM Financing, 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 Financing.

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 Waived ATM Financing until the end of the applicability

of the provisions of the right of first refusal provisions of the Boustead Engagement Letter.

Critical Accounting Estimates

This discussion and analysis of our financial

condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted

accounting principles in the United States (“GAAP”).

The preparation of these financial statements requires us to make estimates

and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at

the date of the financial statements, as well as the reported expenses incurred during the reporting periods.

Our estimates are based

on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which

form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are

described in more detail in the notes to our financial statements included with this Annual Report, we believe that the following accounting

policies are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving

management’s judgments and estimates.

We believe our most critical accounting policies and estimates relate to the following:

Intangible Assets

Intangible assets acquired are recorded at fair

We test our finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying

value of the assets may not be recoverable.

We test our indefinite-lived intangible assets for impairment annually or whenever events

or changes in circumstances indicate that the carrying value of the assets may not be recoverable.

If the carrying value exceeds the fair

value, we recognize an impairment in an amount equal to the excess, not to exceed the carrying value.

Management uses considerable judgment

to determine key assumptions, including projected revenue, royalty rates and appropriate discount rates.

During the year ended December

31, 2024 and 2023, there were no intangible asset impairment charges.

Finite-lived intangible assets are amortized using

the straight-line method over their estimated useful lives, which ranges from 5 to 15 years.

Our finite-lived intangible assets include

acquired franchise agreements, acquired customer relationships, acquired customer lists, and internally developed software.

Our indefinite-lived

intangible assets include acquired domain names, trade names, and purchased software.

Intangible assets internally developed are measured

We capitalize costs to develop or purchase computer software for internal use which are incurred during the application development

These costs include fees paid to third parties for development services and payroll costs for employees’ time spent developing

the software.

We expense costs incurred during the preliminary project stage and the post-implementation stage.

Capitalized development

costs are amortized on a straight-line basis over the estimated useful life of the software.

The capitalization and ongoing assessment

of recoverability of development costs requires considerable judgment by management with respect to certain external factors, including,

but not limited to, technological and economic feasibility, and estimated economic life.

Impairment of Long-lived Assets Other Than

Long-lived assets with finite lives, primarily

property and equipment, intangible assets, and operating lease right-of-use assets are reviewed for impairment whenever events or changes

in circumstances indicate that the carrying amount of an asset may not be recoverable.

If the estimated cash flows from the use of the

asset and its eventual disposition are below the asset’s carrying value, then the asset is deemed to be impaired and written down

to its fair value.

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

Service-Based Awards

The Company records stock-based compensation for

awards granted to employees, non-employees, and to members of the board for their services on the board based on the grant date fair value

of awards issued, and the expense is recorded on a straight-line basis over the requisite service period, which is generally one to three

For restricted stock awards (“RSAs”)

issued under the Company’s stock-based compensation plans, the fair value of each grant is calculated based on the Company’s

stock price on the date of grant.

Share Repurchase

Share repurchases are open market purchases.

repurchases are generally recorded on the settlement date, as treasury stock.

When shares are cancelled, the value of repurchased shares

is deducted from stockholders’ equity through common stock with the excess over par value recorded to accumulated deficit.

Revenue Recognition

The Company recognizes revenue utilizing the following

(i) Identify the contract, or contracts, with a customer;

(ii) Identify the performance obligations in the contract;

(iii) Determine

the transaction price;

(iv) Allocate the transaction price to the performance obligations in the contract;

(v) Recognize revenue when

the Company satisfies a performance obligation.

Subscriptions

Subscription revenue is related to a single performance

obligation that is recognized over time when earned.

Subscriptions are paid in advance and can be purchased on a monthly, quarterly, or

annual basis.

Any quarterly or annual subscription revenue is recognized as a contract liability recorded over the contracted service

Revenue related to marketing campaign contracts

with customers are normally of a short duration, typically less than two (2) weeks.

AE.360.DDM Contracts

Revenue related to AE.360.DDM contracts with customers

are normally of a short duration, typically less than one (1) week.

Contract Liabilities

Contract liabilities consist of quarterly and

annual subscription revenue that have not been recognized.

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

The Company has adopted Financial Accounting Standards

Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 260, “ Earnings per Share ” which

requires presentation of basic earnings per share on the face of the statements of operations for all entities with complex capital structures

and requires a reconciliation of the numerator and denominator of the basic earnings per share computation.

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.

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, 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 above (see Item 1.

“ Business – Corporate History and Structure – Formation and Merger into Asset Entities Inc.

”), the business

now conducted by the Company was operated as a partnership from August 1, 2020 until October 19, 2020, when it was reorganized as a limited

liability company, or LLC, and that LLC was merged into the Company on March 28, 2022.

Prior to that date, the partnership and the subsequent

LLC were not subject to federal income tax and all income, deductions, gains and losses were attributed to the partners or members.

The Company adopted FASB ASC 740, Income Taxes,

at its inception.

Under FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable

to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

tax assets, including tax loss and credit carryforwards, and liabilities are measured using enacted tax rates expected to apply to taxable

income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and

liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Deferred income tax expense

represents the change during the period in the deferred tax assets and deferred tax liabilities.

The components of the deferred tax assets

and liabilities are individually classified as current and non-current based on their characteristics.

Deferred tax assets are reduced

by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets

will not be realized.

No deferred tax assets or liabilities were recognized as of December 31, 2024 or December 31, 2023.

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

November 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 issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact

on its financial statements.

Recently Adopted Accounting Standards

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 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.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The full text of our audited consolidated financial

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

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

Net cash provided by (used in) investing activities (854,648) 16,477 (3,201)

Net cash provided by (used in) financing activities 943,200 (500) 28,865

Net increase (decrease) in cash and cash equivalents $ 63,576 $ (2,232) $ 4,069

Net cash used in operating activities

The primary sources of our cash and cash equivalents from operating activities are collections from customers related to investment advisory services and interest collections from our short-term investments and holdings of cash and cash equivalents.

Our primary uses of cash and cash equivalents are from general and administrative expenses and employee-related expenditures.

Non-cash items to reconcile net loss to net cash and cash equivalents used in operating activities include depreciation and amortization, accretion of discount on short-term investments, amortization of right-of-use assets and liabilities, unrealized gain (loss) on digital assets, at fair value, other derivative loss, share-based compensation expense, gain on lease remeasurement, goodwill and intangible asset impairments, and non-cash transaction expenses.

For the period from September 12, 2025 to December 31, 2025, net cash and cash equivalents used in operating activities was $25.0 million.

This was primarily driven by a $393.6 million net loss generated by Strive, which was driven by a goodwill and intangible asset impairment of $140.8 million, net investment losses of $209.2 million, operating expenses of $33.4 million, and transaction costs of $12.4 million, partially offset by total revenues of $1.5 million and net other income of $0.7 million.

Strive’s net loss was adjusted for non-cash items totaling $374.8 million.

Further, Strive had a net change in operating assets and liabilities of $6.1 million, driven by a decrease in accounts payable and other liabilities of $4.7 million and an increase in prepaid expenses of $2.1 million, which were partially offset by a decrease in other current assets of $0.5 million and an increase in compensation and benefits payable of $0.1 million.

For the period from January 1, 2025 to September 11, 2025, net cash and cash equivalents used in operating activities was $18.2 million.

This was primarily driven by a $27.0 million net loss generated by the Predecessor, which was driven by operating expenses of $16.1 million, and transaction costs of $15.7 million, partially offset by total revenues of $4.2 million and net other income of $0.6 million.

The Predecessor’s net loss was adjusted for non-cash items totaling $2.5 million.

Further, the Predecessor had a net change in operating assets and liabilities of $6.2 million, driven by an increase in accounts payable and other liabilities of $9.8 million, which was partially offset by a decrease compensation and benefits payable of $1.0 million, an increase in prepaid expenses of $0.2 million, an increase in other current assets of $1.6 million, and an increase in other non-current assets of $0.7 million.

For the year ended December 31, 2024, net cash and cash equivalents used in operating activities was $21.6 million.

This was primarily driven by a $21.6 million net loss generated by the Predecessor, which was driven by operating expenses of $26.3 million, partially offset by total revenues of $3.7 million and net other income of $0.8 million.

The Predecessor's net loss was adjusted for non-cash items and a net change in operating assets and liabilities totaling less than $0.1 million.

Net cash provided by (used in) investing activities

For the period from September 12, 2025 to December 31, 2025, net cash and cash equivalents used in investing activities was $854.6 million, primarily due to purchases of digital asset investments of $855.0 million and purchases of property and equipment and intangible assets of $0.1 million, partially offset by cash acquired through the Asset Entities Merger of $0.4 million.

For the period from January 1, 2025 to September 11, 2025, net cash and cash equivalents provided by investing activities was $16.5 million, primarily due to net proceeds from short-term investments of $16.6 million, partially offset purchases of intangible assets of $0.1 million.

For the year ended December 31, 2024, net cash and cash equivalents used in investing activities was $3.2 million, primarily due to net purchases of short-term investments of $3.2 million.

Net cash provided by (used in) financing activities

For the period from September 12, 2025 to December 31, 2025, net cash and cash equivalents provided by financing activities was $943.2 million, primarily due to proceeds from the issuance of Class A Common Stock of $545.1 million, proceeds from the issuance of pre-funded warrants of $283.2 million, proceeds from the issuance of SATA Stock of $161.2 million, proceeds from the exercise of warrants of $31.6 million, which were partially offset by the payment of financing issuance costs of $42.0 million, the payment of withholding taxes upon the vesting of employee restricted stock of $33.6 million, and the payment of dividends on preferred stock of $2.3 million.

For the period from January 1, 2025 to September 11, 2025, net cash and cash equivalents used in financing activities was $0.5 million, primarily due to repurchases of preferred stock of $0.5 million.

For the year ended December 31, 2024, net cash and cash equivalents provided by financing activities was $28.9 million, primarily due to net proceeds from the issuance of preferred stock of $29.0 million, partially offset by repurchases of preferred stock of $0.1 million.

Non-GAAP Financial Measures

This Annual Report contains certain non-GAAP financial measures, consisting of non-GAAP adjusted net income (loss), non-GAAP adjusted net income (loss) attributable to common stockholders and non-GAAP adjusted net income (loss) attributable to common stockholders per diluted common share.

Non-GAAP financial measures are subject to material limitations as they are not measurements prepared in accordance with GAAP and are not a substitute for such measurements.

Our non-GAAP financial measures are not meant to be considered in isolation and should be read only in conjunction with our consolidated financial statements, which have been prepared in accordance with GAAP.

We rely primarily on such consolidated financial statements to understand, manage, and evaluate our business performance and use the non-GAAP financial measures as supplemental information.

Reconciliations of reported GAAP historic measures to adjusted non-GAAP measures are included in the financial schedules contained in this Annual Report.

Non-GAAP adjusted net income (loss)

Non-GAAP adjusted net income (loss), non-GAAP adjusted net income (loss) attributable to common stockholders, and the related non-GAAP adjusted net income (loss) per diluted common share excludes the impact of (i) share-based compensation expense, (ii) depreciation and amortization, (iii) other derivative loss, (iv) transaction costs, (v) gain on lease remeasurement, and (vi) goodwill and intangible asset impairments.

We believe these measures offer management and investors insight as they exclude significant non-cash and/or non-recurring items.

The following provides GAAP measures of net loss, net loss attributable to common stockholders, and net loss per diluted common share and the details with respect to reconciling the line items to non-GAAP adjusted net income (loss), non-GAAP adjusted net income (loss) attributable to common stockholders, and non-GAAP adjusted net income (loss) per diluted common share (all amounts in thousands, other than share and per share information):

Successor Predecessor

Period from September 12, 2025 to December 31, 2025 Period from January 1, 2025 to September 11, 2025 Year Ended December 31, 2024

Net loss $ (393,598) $ (26,990) $ (21,580)

Share-based compensation expense 21,710 — —

Depreciation and amortization 71 149 192

Other derivative loss 14,731 — —

Transaction costs 12,400 15,717 —

Gain on lease remeasurement — — (279)

Goodwill and intangible asset impairment 140,785 — —

Non-GAAP adjusted net income (loss) $ (203,901) $ (11,124) $ (21,667)

Dividends on preferred stock (4,320) — —

Non-GAAP adjusted net loss attributable to common stockholders $ (208,221) $ (11,124) $ (21,667)

Weighted average number of diluted common shares outstanding 43,997,862 2,299,243 2,213,424

Net loss per diluted common share $ (9.04) $ (11.74) $ (9.75)

Non-GAAP adjusted net loss per diluted common share $ (4.73) $ (4.84) $ (9.79)

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

What changed 10-K

Item 7. Management’s Discussion and Analysis