SKYX Platforms Corp. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that there are inherent limitations to the effectiveness of any system of disclosure controls and procedures and any controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving their control objectives. 46 As of the end of the period covered by this report, management, including our Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of our disclosure controls and procedures. Based upon the evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2025. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) promulgated under the Exchange Act. Internal control over financial reporting is a process designed by, or under the supervision of, our Principal Executive Officer and Principal Financial Officer and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external purposes in accordance with GAAP. Internal control over financial reporting includes policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of an issuer’s assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that an issuer’s receipts and expenditures are being made only in accordance with authorizations of its management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of an issuer’s assets that could have a material effect on the consolidated financial statements. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, the application of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that compliance with the policies or procedures may deteriorate. As required by Rule 13a-15(c) promulgated under the Exchange Act, our management, with the participation of our Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of our internal control over financial reporting as of December 31, 2025. Management’s assessment was based on criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013 Framework) (the COSO Framework). Based on management’s assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2025. This Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to the rules of the SEC that permit us to provide only management’s report in this Form 10-K. Changes in Internal Controls Over Financial Reporting There were no changes in our internal control over financial reporting during the quarter ended December 31, 2025 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION Rule 10b5-1 Trading Plans During the quarter ended December 31, 2025, none of the Company’s directors or executive officers adopted , modified or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act or any “non-Rule 10b5-1 trading arrangement” (as defined in Item 408(c) of Regulation S-K). 2026 Annual Meeting of Stockholders The Company’s 2026 Annual Meeting of Stockholders is scheduled to be held on July 7, 2026. Stockholders of record as of May 11, 2026 will be entitled to receive notice of, and vote at, the annual meeting. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. 47 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The following table sets forth the name and position of each of our executive officers and directors, and each person’s age as of March 11, 2026. Name Age Position(s) Rani R. Kohen 60 Executive Chairman, Director Leonard J. Sokolow 69 Chief Executive Officer, Director Marc-Andre Boisseau 61 Chief Financial Officer Steven M. Schmidt 72 President Patricia Barron 65 Chief Operations Officer Nancy DiMattia 65 Director Gary N. Golden 71 Director Efrat L. Greenstein Brayer 63 Director Thomas J. Ridge 80 Director Dov Shiff 78 Director The following information provides a brief description of the business experience of each executive officer and director. Rani R. Kohen founded the Company and invented our technologies. He has served as Executive Chairman of the board since 2016 and as Chairman of our board of directors since November 2012. Mr. Kohen also previously served as our Chief Executive Officer from 2004 through 2012. Mr. Kohen is a businessman, entrepreneur and inventor of our technologies. He brings strategic acumen with over 20 years of experience in business, as well as in advanced smart home technologies, product design, lighting, and other related businesses. Since founding the Company, he has succeeded in attracting and engaging accomplished board members, talented management and leading executives from various industries. He has led to every major milestone achieved by the Company to date, including securing substantial financing to support the Company’s growth. The board of directors believes that with Mr. Kohen’s leadership and qualifications, and the continuity that he brings with his advanced business strategies, he will continue to move us forward towards achieving our goals. Leonard J. Sokolow has served as Chief Executive Officer of the Company since September 30, 2025 and previously served as co-Chief Executive Officer from September 2023 to September 30, 2025. Mr. Sokolow has also served as a director of the Company since November 2015. Mr. Sokolow previously served in various roles at Newbridge Financial, Inc. and its subsidiaries, including as Chief Executive Officer and President of Newbridge Financial, Inc. from January 2015 through August 2023; as Chief Executive Officer of Newbridge Financial, Inc.’s broker-dealer subsidiary, Newbridge Securities Corporation, and Chief Executive Officer of Newbridge Financial, Inc.’s registered investment adviser subsidiary, Newbridge Financial Services Group, Inc., from July 2022 through August 2023; and as Chairman of Newbridge Securities Corporation from January 2015 through July 2022. Mr. Sokolow previously served in a variety of roles at vFinance, Inc., a publicly traded financial services company, including as Chairman of the board of directors from January 2007, a member of the board of directors from November 1997 and Chief Executive Officer from January 2007 through July 2008, when it merged into National Holdings Corporation, a publicly traded financial services company. Mr. Sokolow also served as President of vFinance, Inc. from January 2001 through December 2006. From July 2008 until July 2012, Mr. Sokolow was President of National Holdings Corporation, and from July 2008 until July 2014, he was Vice Chairman of the board of directors of National Holdings Corporation. From July 2012 until December 2014, Mr. Sokolow was a consultant and partner at Caribou LLC, a strategic advisory services firm. Mr. Sokolow was Founder, Chairman and Chief Executive Officer of the Americas Growth Fund Inc., a closed-end management investment company elected to be treated as a Business Development Company (BDC), from 1994 to 1998. From 1988 until 1993, Mr. Sokolow was an Executive Vice President and the General Counsel of Applica Inc., a publicly traded appliance marketing and distribution company. From 1982 until 1988, Mr. Sokolow practiced corporate, securities and tax law and was one of the founding attorneys and a partner of an international boutique law firm. From 1980 until 1982, he worked as a Certified Public Accountant for Ernst & Young and KPMG Peat Marwick. 48 Mr. Sokolow has served on the board of directors of Consolidated Water Co. Ltd., a publicly traded developer and operator of advanced water supply and treatment plants and water distribution systems, since June 2006, where he currently serves as Chairman of the Audit Committee and as a member of the Nominations and Corporate Governance Committee. In addition, Mr. Sokolow has served on the board of directors of Vivos Therapeutics, Inc., a publicly traded medical technology company focused on developing and commercializing innovative diagnostic and treatment methods for patients suffering from breathing and sleep issues arising from certain dentofacial abnormalities, such as obstructive sleep apnea (OSA) and snoring in adults, since June 2020, where he currently serves as Chairman of the Audit Committee and as a member of the Nominating and Corporate Governance Committee. Mr. Sokolow previously served on the board of directors of, and as Chairman of the Audit Committee for, Agrify Corporation, a publicly traded provider of innovative cultivation and extraction solutions for the cannabis industry, and on the board of directors of, and as Chairman of the Audit Committee for, Marquee Energy Ltd. (formerly Alberta Oilsands Inc.), a then publicly traded energy company. Our Board believes Mr. Sokolow’s qualifications to serve as a member of our Board include his extensive experience in the financial industry and in strategic planning, mergers, acquisitions, securities, and corporate development advisory services, his service on other public company boards and his history of executive leadership in developing and operating businesses. Marc-Andre Boisseau has served as our Chief Financial Officer and as our principal financial officer and principal accounting officer since January 1, 2022. Mr. Boisseau is a partner of Boisseau, Felicione & Associates Inc., which provides advisory and tax services for public and private companies in a variety of industries and which he founded in February 2002. Among other positions, Mr. Boisseau served at Citrix Systems, Inc., a publicly-traded software development company, as Corporate Controller from 1995 to December 1999 and as Principal Accounting Officer from March 1997 to December 1999, and as a senior auditor at Ernst & Young. Mr. Boisseau is a Certified Public Accountant. Steven M. Schmidt has served as our President since June 2021 and previously served as a consultant to the Company since August 2019. Mr. Schmidt formed Schmidt Family Investments LLC, which invests in early-stage companies, in May 2017, of which he is the sole principal. Mr. Schmidt previously served in a variety of roles at Office Depot, Inc., an office supply retailer, from July 2007 through May 2016, including as Executive Vice President and President, International from November 2011 to May 2016, Executive Vice President, Corporate Strategy and New Business Development from July 2011 until November 2011 and President, North American Business Solutions from July 2007 until November 2011. Prior to joining Office Depot, Inc., Mr. Schmidt spent 11 years with the ACNielsen Corporation, a marketing research firm, most recently serving as President and Chief Executive Officer. Prior to joining ACNielsen, Mr. Schmidt spent eight years at the Pillsbury Food Company, serving as President of its Canadian and Southeast Asian operations. He has also held management positions at PepsiCo and Procter & Gamble. Patricia Barron has served as our Chief Operations Officer since June 2007. Prior to joining the Company, Ms. Barron was the President and owner of LTG Services, Inc., which focused on safety consulting services, specializing in the review and compliance of electrical products requiring UL, CSA, and CE certifications, since 1989. Prior to that, Ms. Barron worked as a consultant and engineer in the lighting, safety and approval industry and, from June 1977 to August 1984, worked as an engineering assistant for Underwriters Laboratories, Inc. (n/k/a UL) in the ceiling fan category. Ms. Barron received her MBA from Georgia State University. Ms. Barron has extensive industry and executive experience. Nancy DiMattia has served as a director of the Company since February 2022. Ms. DiMattia has served as Chief Financial Officer of Island Stone North America, a manufacturer and supplier of natural stone and man-made tiles, from October 2022 to March 2026. Ms. DiMattia previously served as Senior Vice President and Chief Financial Officer of Tile Shop Holdings, Inc., a publicly traded specialty retailer of natural stone and man-made tiles, setting and maintenance materials, and related accessories, from September 2019 until January 2022, where she continued to serve in an advisory capacity through March 2022. She also previously provided consulting services to Tile Shop Holdings, Inc. from July 2019 until September 2019. Before joining Tile Shop Holdings, Inc., Ms. DiMattia gained over twenty-five years of experience in financial reporting and accounting processes in positions of increasing responsibility at Virginia Tile Company, a provider of ceramic, porcelain, glass and natural stone tiles, most recently serving as the Corporate Controller from 2005 until March 2019. During her tenure at Virginia Tile Company, she was responsible for establishing sound financial management, promoting effective internal accounting controls, developing and leading highly competent accounting teams, and maintaining a documented system of accounting policies and procedures. Our board believes Ms. DiMattia’s qualifications to serve as a member of our board include her retail industry experience, including her experience overseeing retail-related information technology measures and working with a customer base that includes architects and designers, and financial expertise, including managing audits, internal controls and mergers and acquisitions. 49 Gary N. Golden has served as a director of the Company since February 2022. Mr. Golden served as the Chief Financial Officer of Media Culture, a brand response media agency, between June 2023 and February 2026. Mr. Golden was previously employed at vcfo, which offers fractional CFO and human resources services to clients who require advisors they can trust to guide them through major changes, from April 2022 through May 2023. During 2021, Mr. Golden served as interim Chief Financial Officer of ADB Companies, which provides strategy, design, execution and program management services for the communication, utility, and technology industries. Prior to that, during 2021, Mr. Golden served as a project manager and professional services contractor for MMC Group, Inc., which offers full-service workforce solutions, and as interim controller at SportClips Haircuts. During 2020, he served as a special project auditor for WebsterRogers LLP, a South Carolina-based accounting and consulting firm that provides a broad spectrum of assurance, tax and advisory services. From 2008 to 2019, Mr. Golden served as Chief Financial Officer at NBG Home, an affiliate of Nielsen & Bainbridge, LLC and one of the largest home decor manufacturing companies and importers globally. From 2008 to 2013, Mr. Golden served as Chief Financial Officer and Professional Services Contractor for MMC Group, Inc. Mr. Golden has served in a variety of other financial and operational roles, including as Vice President, Controller of Kinko’s Inc., Senior Vice President and Corporate Controller of Blockbuster, Inc., and in controller and internal audit roles at Fuqua Industries and Qualex, Inc. Mr. Golden began his career at Arthur Andersen & Inc. Our board believes Mr. Golden’s qualifications to serve as a member of our board include his financial expertise, including his status as an “audit committee financial expert,” and his experience in the home goods and lighting industry. Mr. Golden is a Certified Public Accountant. Efrat L. Greenstein Brayer has served as a director of the Company since February 2022. Ms. Greenstein Brayer currently serves as Co-Founder and Chief Executive Officer of Merkavah Inc. (d/b/a Ezzree), which provides online emotional and spiritual support care services, and has been principal attorney of the law office of Laura Greenstein since 2000, where she provides services as a corporate finance attorney. Ms. Greenstein Brayer previously served as a contract attorney with Holland & Knight LLP from 2006 through 2012, as associate counsel at Bank Hapoalim B.M. from 1996 through 2000, as an associate at Rogers & Wells (later acquired by Clifford Chance LLP) from 1993 through 1996, and as an associate at Haight, Gardner, Poor & Havens (later acquired by Holland & Knight LLP) from 1988 through 1993. Ms. Greenstein Brayer has also served as an officer or director of several private companies. Our board believes Ms. Greenstein Brayer’s qualifications to serve as a member of our board include her corporate law expertise and her experience founding and serving as Chief Executive Officer of a private company, including her experience with customer service and technology innovation. Governor Thomas J. Ridge has served as a director of the Company since June 2013. Mr. Ridge founded and has served at Ridge Global, LLC, a global strategic consulting company and provider of insurance and risk transfer solutions, since July 2006, where he currently serves as Chairman of the board and previously served as Chief Executive Officer and President. In 2014, Mr. Ridge co-founded Ridge Schmidt Cyber, an executive services firm addressing the increasing demands of cybersecurity. In April 2010, Mr. Ridge became a partner of Ridge Policy Group, a bipartisan, full-service government affairs and issue management group. From January 2003 to January 2005, Mr. Ridge served as the Secretary of the United States Department of Homeland Security, and from September 2001 through January 2003, Mr. Ridge served as the Special Assistant to the President for Homeland Security. Mr. Ridge served two terms as Governor of the Commonwealth of Pennsylvania, from 1995 to 2001, and served as a member of the U.S. House of Representatives from January 1983 until January 1995. Mr. Ridge previously served as a member of the board of directors of The Hershey Company, a global confectionery leader, from November 2007 to May 2018, Advaxis, Inc., a then publicly traded clinical-stage biotechnology company, from August 2015 to March 2018, and LifeLock, Inc., a then publicly traded provider of identity theft protection, from March 2010 to February 2017, until its merger with a subsidiary of Symantec Corporation, as well as several other public companies. Mr. Ridge serves as Co-Chair of the Bipartisan Commission on Biodefense, as Chairman Emeritus of the board of the National Organization on Disability, and as a member of board of counselors of the Center for the Study of the Presidency and Congress, among other private organizations. Our board believes Mr. Ridge’s qualifications to serve as a member of our board include his vast experience in both government and industry, his service on other public and private company boards and his expertise in risk management and cybersecurity. Dov Shiff has served as a director of the Company since February 2014. Mr. Shiff is presently President and Chief Executive Officer of the Shiff Group of Companies. The Shiff Group owns and operates Shiff Group Assets Ltd., Shiff Group Investments Ltd., and Zvidan Investments Ltd. Our board believes Mr. Shiff’s qualifications to serve as a member of our board include his experience in developing and operating new businesses. 50 Family Relationships There are no family relationships among any of our directors or executive officers. Composition of our Board of Directors Our business and affairs are managed under the direction of our board of directors, which currently consists of seven directors. The number of directors is determined by our board of directors or our stockholders, but will not be less than five persons, subject to the terms of our articles of incorporation and our bylaws. Each director is elected to a one-year term and holds office until his or her successor is duly elected and qualified or until his or her earlier death, resignation, retirement or removal. Vacancies and newly created directorships on the board of directors may be filled at any time by the remaining directors. Board Committees Our board of directors has three standing committees: an audit committee, a compensation committee and a nominating and corporate governance committee. Each member of each standing committee of our board of directors qualifies as an independent director in accordance with the listing standards of Nasdaq. Our board of directors may from time to time establish other committees; for example, the board of directors has established a business strategy and development committee, which consists of Rani R. Kohen, Leonard J. Sokolow, and Nancy DiMattia. Each standing committee operates pursuant to a charter adopted by our board of directors. The full text of our audit committee charter, compensation committee charter and nominating and corporate governance committee charter are posted on the investor relations section of our website at www.skyplug.com. Audit Committee Our audit committee consists of Ms. DiMattia, Ms. Greenstein Brayer, and Mr. Golden, who is the chair of the audit committee. The functions of the audit committee include: ● appointing, approving the compensation of and assessing the independence of our independent registered public accounting firm; ● pre-approving audit and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm; ● reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements; ● reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures; ● reviewing our disclosure controls and procedures, as well as reviewing disclosures regarding our internal control over financial reporting; ● establishing policies and procedures for the receipt, retention and treatment of accounting-related complaints and concerns; ● recommending to the board of directors, based upon the audit committee’s review and discussions with management and our independent registered public accounting firm, whether our audited financial statements will be included in our annual reports on Form 10-K; ● discussing with management our policies with respect to risk assessment and risk management and our significant financial risk exposures, as well as information security and technology risks (including cybersecurity and artificial intelligence); ● preparing the audit committee report required by SEC rules to be included in our annual proxy statement; ● reviewing and overseeing all related person transactions for potential conflict of interest situations, as well as annually reviewing the related party transactions policy; ● overseeing compliance with, and annually reviewing, the Code of Business Conduct and Ethics; and ● reviewing quarterly earnings releases. All members of our audit committee meet the requirements for financial literacy under the applicable rules and regulations of the SEC and Nasdaq listing standards. Our board of directors has determined that Mr. Golden qualifies as an “audit committee financial expert” within the meaning of applicable SEC regulations and meets the financial sophistication requirements of the Nasdaq listing standards. In making this determination, our board of directors considered Mr. Golden’s prior experience, business acumen and independence. Both our independent registered public accounting firm and management periodically meet privately with our audit committee. 51 Compensation Committee Our compensation committee consists of Ms. DiMattia, Ms. Greenstein Brayer and Mr. Golden, who is the chair of the compensation committee. The functions of the compensation committee include: ● annually reviewing our overall compensation policy as it applies to our employees generally, and the corporate goals and objectives relevant to compensation of the Executive Chairman, Chief Executive Officer and our other executive officers; ● reviewing and approving or recommending to the board of directors the compensation of our executive officers; ● reviewing and approving or recommending to the board of directors our incentive compensation plans and equity-based plans; ● reviewing and recommending to the board of directors the compensation of our non-management directors; ● reviewing the executive compensation disclosures and, if and when required, preparing the compensation committee report required by SEC rules to be included in our annual proxy statement or Form 10-K, as applicable; ● overseeing risks relating to our compensation policies, practices and procedures; ● reviewing and overseeing the application of the Company’s policy for claw back, or recoupment, of incentive compensation; ● reviewing our strategies related to human capital management, including talent acquisition, development and retention and corporate culture; and ● reviewing and approving the retention, termination or compensation of any consulting firm or outside advisor to assist in the evaluation of compensation matters. Each member of our compensation committee is a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange Act. Nominating and Corporate Governance Committee Our nominating and corporate governance committee consists of Ms. DiMattia, Mr. Golden and Ms. Greenstein Brayer, who is the chair of the nominating and corporate governance committee. The functions of the nominating and corporate governance committee include: ● identifying and evaluating individuals qualified to become members of the board of directors; ● recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees; ● considering, developing and recommending to the board of directors policies and procedures with respect to the nomination of directors or other corporate governance matters; ● reviewing disclosures relating to our corporate governance practices to be included in our annual proxy statement or Form 10-K, as applicable; ● reviewing our policies and practices regarding corporate social responsibility and environmental, social and governance matters and related risks; ● reviewing proposals submitted by stockholders for inclusion in our proxy materials; and ● overseeing the evaluation of our board of directors and board committees. Each member of our nominating and governance committee is a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange Act. 52 Insider Trading Policies and Procedures The board has adopted an insider trading policy (the “Insider Trading Policy”) that applies to all directors, officers and employees of the Company and its subsidiaries, as well as certain other designated persons, and provides guidelines with respect to transactions in the Company’s securities and the handling of confidential information about the Company and the companies with which the Company engages in transactions or does business, and promotes compliance with the securities laws. Among other things, the Insider Trading Policy prohibits directors, officers and employees of the Company and its subsidiaries from the following: (i) engaging in transactions in Company securities on material non-public information, subject to certain exceptions, including pursuant to an approved trading plan under Rule 10b5-1 of the Exchange Act (“Rule 10b5-1”); (ii) disclosing material non-public information to other parties (or “tipping”); and (iii) engaging in transactions in securities based on material non-public information about other companies with which the Company does business, in which the Company has significant investments, or that is involved in a potential transaction or business relationship with the Company. The Insider Trading Policy also prohibits our employees, officers and directors from engaging in hedging or monetization transactions with respect to our securities, including through the use of financial instruments such as prepaid variable forwards, equity swaps, collars and exchange funds, transactions in derivative securities related to our securities, which include publicly traded call and put options, and short selling of our securities. The Insider Trading Policy additionally prohibits holding our securities in a margin account or otherwise pledging our securities as collateral, except with prior approval of the compliance officer designated under the Insider Trading Policy. Certain covered persons, including our directors and officers and their covered family members and controlled entities, are subject to blackout periods during which they are restricted from transacting in our securities and are required to receive approval from the compliance officer prior to engaging in transactions in our securities. The Insider Trading Policy also sets forth mandatory guidelines that apply to directors, officers and employees of the Company and its subsidiaries who adopt Rule 10b5-1 plans for transactions in Company securities, which are intended to ensure compliance with Rule 10b5-1. For additional information, see the Insider Trading Policy, which is included in the exhibit index to this Form 10-K and posted on the investor relations section of our website at www.skyplug.com. It is also the policy of the Company that the Company will not engage in transactions in Company securities, or adopt any securities repurchase plans, while in possession of material non-public information relating to the Company or its securities other than in compliance with applicable law. Code of Business Conduct and Ethics Our board of directors has adopted a Code of Business Conduct and Ethics, which applies to all of our directors, employees, and officers (including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions). The full text of our Code of Business Conduct and Ethics is posted on the investor relations section of our website at www.skyplug.com. We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of our Code of Business Conduct and Ethics by posting such information on our website within four business days following the date of the amendment or waiver. Involvement in Certain Legal Proceedings To the best of our knowledge, none of our directors or executive officers were involved in any legal proceedings described in Item 401(f) of Regulation S-K in the past 10 years. Delinquent Section 16(a) Reports Section 16(a) of the Exchange Act requires all persons subject to such reporting requirements to file initial reports of ownership and reports of changes in ownership of our common stock and other equity securities with the SEC. To our knowledge, based solely on a review of these reports filed with the SEC and certain written representations furnished to us that no other reports were required, we believe that all Section 16 filing requirements applicable to our executive officers, directors and greater than 10% stockholders were complied with during the fiscal year ended December 31, 2025 and through the date of this Form 10-K, except as follows: a Form 4 filed by Dov Shiff on April 2, 2025, reporting the March 27, 2025 annual grant of restricted stock and stock options pursuant to the Director Compensation Program; a Form 4 filed by Rani Kohen on December 12, 2025, reporting the December 8, 2025 grant of options; and a Form 4 filed by Dov Shiff on January 5, 2026, reporting the December 30, 2025 amendment to a convertible promissory note. 53 ITEM 11. EXECUTIVE COMPENSATION EXECUTIVE COMPENSATION Compensation Overview Our “named executive officers” for the year ended December 31, 2025 were: ● Leonard J. Sokolow, Chief Executive Officer; ● John Campi, Former Co-Chief Executive Officer; (1) ● Rani R. Kohen, Executive Chairman; ● Marc-Andre Boisseau, Chief Financial Officer; ● Steven M. Schmidt, President; and ● Patricia Barron, Chief Operations Officer. (1) Messrs. Sokolow and Campi served as Co-Chief Executive Officers until September 30, 2025, when Mr. Campi retired as Co-Chief Executive Officer of the Company pursuant to the Company’s succession and transition plan Our executive compensation program reflects our continued growth and development-oriented focus. We recognize that our ability to excel depends on the knowledge, skill and teamwork of our employees. To this end, we strive to create an environment of mutual respect, encouragement, and teamwork that rewards commitment and performance and is responsive to the needs of our employees. The principles and objectives of our compensation and benefits programs for our employees generally, and for our named executive officers specifically, include to align our compensation program with our corporate strategies, financial objectives and the long-term interests of our stockholders; retain and reward executives whose knowledge, skills and performance ensure our continued success; and ensure that total compensation is fair, reasonable and competitive. The compensation received by our named executive officers is based primarily on their experience and knowledge as well as their responsibilities and individual contributions to the Company. The compensation committee of our board of directors evaluates our executive compensation values and philosophy and executive compensation plans and arrangements as circumstances require. As part of this review process, we expect the compensation committee to apply our values and philosophy, while considering the compensation levels needed to ensure our executive compensation program remains competitive. We will also review whether we are meeting our retention objectives and the potential cost of replacing a key employee. Executive Compensation Program Components Base Salary Our Named Executives’ base salaries are set to align with the scope and complexity of their roles, their capabilities, and competitive market conditions. Incentive and Bonus Compensation-Cash based and Equity Compensation Awards We supplement our executive salaries with cash and share-based payments as additional incentive to grow our business to provide a competitive aggregate compensation package considering our size and scale. We try to prioritize share-based payments over cash-based payments incentive whenever possible. We have an executive compensation recovery policy that provides for recoupment in the event of a restatement or misconduct to ensure accountability. Certain named executive officers’ employment agreements also provide for the receipt of incentive and/or bonus compensation, which may be paid annually in cash and/or stock. These incentive compensation and bonus awards are designed to focus our executive officers on our business objectives of increased growth. Mr. Sokolow will receive a minimum bonus every six months during the term of his employment agreement equal to $40,000 in cash or stock, as elected by Mr. Sokolow, and is eligible to receive a performance-based bonus, payable in equity and/or cash, subject to the achievement of performance metrics and other criteria as determined by the Executive Chairman and approved by the compensation committee. Mr. Kohen is eligible to receive annual incentive compensation based on our annual gross revenue, which may be paid in cash, stock and/or options, as well as supplemental bonus compensation of performance-based stock options to purchase up to 15,000,000 shares of common stock at an exercise price ranging between $6.00 and $12.00 per share, determined based on the achievement of specified market capitalizations of the Company, and the potential to receive further options based on the achievement of additional specific market capitalizations of the Company, as described further below under “Agreements with Named Executive Officers.” Mr. Schmidt may receive additional equity grants or other bonus or other incentive compensation, as determined by the Company. Mr. Boisseau is eligible to receive performance-based compensation in the form of a bonus, payable in equity and/or cash, as determined by the compensation committee, subject to the achievement of performance metrics and other criteria as determined by the Executive Chairman and approved by the compensation committee. The actual incentive and/or bonus compensation earned by each of our named executive officers during our most recent fiscal year is set forth in the “Summary Compensation Table” below. Other Equity Compensation and Awards Our named executive officers may also receive equity awards under our 2021 Stock Incentive Plan (as amended and restated, the “2021 Plan”). We use equity awards to align the interests of our named executive officers with those of our stockholders. We believe that equity awards, such as stock options, restricted stock units (“RSUs”) and non-vested restricted stock, encourage our named executive officers to focus on our long-term success as reflected in increases to our stock prices over a period of several years, growth in our profitability and other elements. 54 The compensation committee approved the following cash and equity awards during 2025: On March 20, 2025, the compensation committee approved a cash bonus to Mr. Campi equal to $30,000. On March 27, 2025, the compensation committee granted to Mr. Sokolow a five-year option to purchase 150,000 shares of the Company’s common stock at an exercise price of $1.26 per share, which vests in three equal annual installments, beginning on the grant date, subject to continued employment through the vesting date. On August 8, 2025, the compensation committee approved the payment of a twelve-month bonus to Mr. Boisseau equal to $75,000, payable in equal monthly installments over twelve months, beginning on September 2025 and continuing through August 2026. On August 15, 2025, the compensation committee granted to Ms. Barron a five-year option to purchase 500,000 shares of the Company’s common stock at an exercise price of $1.11 per share, which vests in four equal annual installments, beginning on the grant date subject to continued employment through the applicable vesting date. On December 8, 2025, the compensation committee granted to Mr. Kohen a five-year option to purchase 1,500,000 shares of the Company’s common stock at an exercise price of $2.42 per share, which vests in six quarterly installments of 250,000 beginning on December 31, 2025, subject to continued employment through the vesting date. On December 15, 2025, the compensation committee granted to Mr. Sokolow 150,000 restricted stock units (“RSUs”) representing a contingent right to receive one share of the Company’s common stock which vest in three equal annual installments beginning on January 1, 2026 and a five-year option to purchase 150,000 shares of the Company’s common stock at an exercise price of $2.15 per share, which vest in three equal annual installments beginning on January 1, 2026, subject to continued employment through the applicable vesting dates. We may also grant equity-based sign-on bonuses when necessary and appropriate to advance our and our stockholders’ interests, including to attract or retain top executive-level talent. Benefits and Perquisites We offer health insurance to our full-time employees, including our named executive officers. We generally do not provide perquisites or personal benefits to our named executive officers, except in limited circumstances. 55 Summary Compensation Table The following table sets forth summary compensation information for the named executive officers and includes all compensation earned by the named executive officers for the respective period, regardless of whether such amounts were actually paid during the period. Name and Principal Position Year Salary ($) Bonus ($) Stock Awards ($) (1)(2) Option Awards ($) (1)(2) Non- Equity Incentive Plan Compensation ($) (3) All Other Compensation ($) (4) Total ($) John P. Campi 2025 118,750 75,000 - - - 137 193,887 Former Co-Chief Executive Officer 2024 150,000 45,000 - - - - 195,000 Leonard J. Sokolow 2025 160,000 80,000 322,500 328,665 - 25,197 916,362 Chief Executive Officer 2024 160,000 125,000 - - - 21,909 306,909 Rani R. Kohen 2025 300,000 - - 2,269,500 310,050 62,252 2,941,802 Executive Chairman 2024 300,000 - - - 281,384 69,256 650,640 Marc-Andre Boisseau 2025 144,000 75,000 - - - 23,828 242,828 Chief Financial Officer 2024 144,000 51,000 - - __ 12,010 207,010 Patricia Barron 2025 150,000 55,750 - 387,300 - 19,866 612,916 Chief Operations Officer 2024 150,000 13,500 - 67,900 - 30,260 261,660 Steven M. Schmidt 2025 - - - - - - - President 2024 - 10,300 334,750 235,530 - - 580,580 (1) The value of stock awards and options in this table represents the fair value of such awards granted or modified during the fiscal year, as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“Topic 718”). The assumptions used to determine the valuation of the awards are discussed in Note 2 and Note 11 to our consolidated financial statements for the year ended December 31, 2025. (2) During 2025: (i) Ms. Barron received options to purchase 500,000 shares of common stock at an exercise price of $1.11 per share; (ii) Mr. Kohen received options to purchase 1,500,000 shares of common stock at an exercise price of $2.42 per share; and (iii) Mr. Sokolow received options to purchase 150,000 shares of common stock at an exercise price of $1.26 per share, 150,000 RSUs, and options to purchase 150,000 shares of common stock at an exercise price of $2.15. During 2024: (i) Ms. Barron received options to purchase 100,000 shares of common stock at an exercise price of $1.09 per share; and (ii) Mr. Schmidt received 350,000 RSUs, options to purchase 250,000 shares of common stock at an exercise price of $0.90 per share, and options to purchase 100,000 shares of common stock at an exercise price of $1.09 per share. (3) Non-Equity Incentive Plan Compensation reflects incentive compensation payable pursuant to each individual’s respective employment agreement, typically as a percent of the Company’s net revenue or sales earned, and in each case as described below under “Agreements with Named Executive Officers.” In March 2024, Mr. Campi and Ms. Barron each entered into a commission termination agreement, terminating the incentive compensation-related provisions in their employment agreements and agreeing no amounts would be paid pursuant to such provisions for prior periods that had not previously been paid. (4) All Other Compensation includes the amounts identified below for the applicable fiscal year: Name and Principal Position Year Health Insurance Premiums ($) 401(k) Employer contributions ($) Paid time-Off ($) Car Allowance ($) (1)(2) Total ($) John P. Campi 2025 137 - - - - 137 Former Co-Chief Executive Officer 2024 - - - - - - Leonard J. Sokolow 2025 25,197 - 25,197 Chief Executive Officer 2024 21,909 - - - - 21,909 Rani R. Kohen 2025 25,252 - 25,000 12,000 62,252 Executive Chairman 2024 28,410 - 28,846 12,000 69,256 Marc-Andre Boisseau 2025 15,128 8,700 - - 23,828 Chief Financial Officer 2024 4,210 7,800 - - 12,010 Patricia Barron 2025 11,886 7,980 - - 19,866 Chief Operations Officer 2024 10,720 7,040 12,500 - 30,260 Steven M. Schmidt 2025 - - - - - President 2024 - - - - - 56 The following shows each named executive officer’s 2025 compensation separated by cash-based compensation and stock-based compensation: Name and Principal Position Cash-Based Compensation ($) Stock-Based Compensation ($) Total Compensation ($) John P. Campi Former Co-Chief Executive Officer 193,887 - 193,887 Leonard J. Sokolow Chief Executive Officer 265,197 651,165 916,362 Rani R. Kohen Executive Chairman 672,302 2,269,500 2,941,802 Marc-Andre Boisseau Chief Financial Officer 242,828 - 242,828 Patricia Barron Chief Operations Officer 225,616 387,300 612,916 Steven M. Schmidt President Outstanding Equity Awards at Fiscal Year End The table below sets forth certain information regarding outstanding equity awards held by the named executive officers as of December 31, 2025. Mr. Campi did not hold any outstanding equity awards as of December 31, 2025. Option Awards Stock Awards Name Number of securities underlying unexercised options (#) exercisable Number of securities underlying unexercised options (#) Not exercisable Equity incentive plan awards: Number of securities underlying unexercised unearned options (#) Option exercise price ($) Option expiration date Number of shares or units of stock that have not vested (#) Market value of shares or units of stock that have not vested ($)* Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#) Equity incentive plan awards: Market or payout value of unearned shares, units or other rights that have not vested ($) Leonard Sokolow 150,000 - - 3.00 4/19/2027 - - - - 150,000 - - 4.00 4/19/2027 - - - - 100,000 - - 12.00 12/31/2026 - - - - 17,500 - - 12.34 3/11/2027 - - - - 17,500 - - 3.28 4/5/2028 - - - - 220,000 230,000 (1) - 1.58 9/12/2028 - - - - - - - - - 230,000 (1) 266,800 - - Rani R. Kohen (2) 800,000 340,000 (3) - 12.00 1/1/2027 - - - - 1,000,000 1,000,000 6.00 1/1/2027 2,000,000 7.00 1/1/2027 2,000,000 8.00 1/1/2027 10,000,000 12.00 1/1/2027 Marc-Andre Boisseau 80,000 40,000 (4) - 3.28 4/5/2028 - - - - - - - - - 40,000 (4) 46,400 - - Patricia Barron 50,000 - - 3.00 4/19/2027 - - - - 50,000 - - 4.00 4/19/2027 - - - - 50,000 50,000 (5) - 2.08 8/4/2028 - - - - - - - - - 50,000 (5) 58,000 - - - 100,000 (6) - 1.09 12/15/2029 - - - - Steven M. Schmidt 100,000 - - 12.00 6/1/2026 - - - - 30,000 220,000 (7) - 0.90 9/15/2029 - - - - - - - - - 220,000 (7) 255,200 - 100,000 (9) - 1.09 12/15/2029 - - - - - - - - - 100,000 (8) 116,000 - - * Based on the closing stock price of our common stock of $2.17 on December 31, 2025, the last trading day of 2025. (1) These options and RSUs vest as follows: 200,000 will vest in four semi-annual instalments of 50,000, beginning on March 12, 2025, and 30,000 will vest on March 12, 2027. 57 (2) Pursuant to Mr. Kohen’s chairman agreement, Mr. Kohen has the following options as supplemental bonus compensation, subject to the Company achieving the specified market capitalization (i) options to purchase 500,000 shares of common stock at an exercise price of $6.00 per share, upon the Company achieving each of the following market capitalizations: $1.5 billion and $2.0 billion; (ii) options to purchase 500,000 shares of common stock at an exercise price of $7.00 per share, upon the Company achieving each of the following market capitalizations: $3.0 billion, $4.0 billion, $5.0 billion and $6.0 billion; and (iii) options to purchase 500,000 shares of common stock at an exercise price of $8.00 per share, upon the Company achieving each of the following market capitalizations: $7.0 billion, $8.0 billion, $9.0 billion and $10.0 billion. Mr. Kohen also received supplemental bonus compensation such that, in the event the Company achieves a $10.0 billion valuation, for each valuation increase of $1.0 billion up to $30.0 billion Company valuation, Mr. Kohen will receive an option to purchase 500,000 shares at an exercise price of $12.00 per share. (3) These options vest on January 1, 2025. (4) These options and RSUs vest on April 5, 2025. (5) These options and RSUs vest in two equal annual installments on each of August 4, 2025 and 2026. (6) These options vest in three equal annual installments on each of January 1, 2025, 2026 and 2027. (7) These options and RSUs vest in eleven equal quarterly installments of 20,000, beginning March 31, 2025. (8) These options and RSUs vest in two equal annual instalments on each of January 1, 2025 and 2026. Agreements with Named Executive Officers John P. Campi (Former Co-Chief Executive Officer) Prior to his retirement as Co-Chief Executive Officer on September 30, 2025, Mr. Campi was a party to an employment agreement with the Company. Leonard J. Sokolow (Chief Executive Officer) In connection with his employment as Co-Chief Executive Officer, the Company and Mr. Sokolow entered into an employment agreement, effective as of September 12, 2023 (the “Sokolow Agreement”). Pursuant to the Sokolow Agreement, Mr. Sokolow will receive a base salary of $160,000 per year, subject to annual review and adjustment by the compensation committee, and a minimum bonus every six months during the term of the Sokolow Agreement equal to $40,000 in cash or stock, as elected by Mr. Sokolow. In addition, Mr. Sokolow will be eligible to receive a performance-based bonus, payable in equity and/or cash, subject to the achievement of performance metrics and other criteria as determined by the Executive Chairman and approved by the compensation committee. Subject to the compensation committee’s approval, the Company and Mr. Sokolow may agree on an annual bonus structure (in addition to the minimum bonus described above) based on performance metrics and other criteria, and such bonus payments could be a combination of stock, stock options, and cash. 58 Pursuant to the Sokolow Agreement, on September 12, 2023, the compensation committee granted to Mr. Sokolow (i) 450,000 RSUs, 120,000 of which vested on the date of grant, 300,000 of which will vest in six semi-annual installments of 50,000, beginning on March 12, 2024, and 30,000 of which will vest on March 12, 2027; and (ii) five-year stock options to purchase up to 450,000 shares of the Company’s common stock at an exercise price of $1.58 per share, 120,000 of which vested on the date of grant, 300,000 of which will vest in six semi-annual installments of 50,000, beginning on March 12, 2024, and 30,000 of which will vest on March 12, 2027, in each case subject to continuous employment through the applicable vesting date. The awards were granted pursuant to the terms and conditions of the 2021 Plan and applicable equity award agreements. Mr. Sokolow is also entitled to receive expense reimbursement for reasonable expenses, approved in writing by the Company, incurred in the performance of his duties. He is entitled up to four weeks of vacation per year and to participate in the Company’s benefit programs for executive employees. The Sokolow Agreement also contains non-competition and non-solicitation covenants and provides for severance under certain circumstances as described in the Sokolow Agreement. In particular, in the event the Company terminates Mr. Sokolow’s employment for any reason other than for Disability or Cause (as such terms are defined in the Sokolow Agreement), the Company gives notice of nonrenewal of the Sokolow Agreement, or if Mr. Sokolow terminates his employment for Good Reason (as defined in the Sokolow Agreement), the Company will provide the following benefits: (i) severance pay equal to six months of Mr. Sokolow’s ending annual base salary, minus withholdings, (ii) a gross amount equal to six months of the cost of Mr. Sokolow’s monthly health insurance premium for him and his eligible dependents (if any), conditioned on Mr. Sokolow electing to continue health insurance coverage through COBRA, and (iii) the portions of Mr. Sokolow’s RSU and stock option awards that are due to vest during six months following his termination date will vest on their respective vesting dates. The Sokolow Agreement has a three-year term, with automatic renewal annually following the initial three-year term for an additional one year unless terminated by either party by providing at least 30-days’ written notice prior to the end of the then term. Rani R. Kohen (Executive Chairman) Effective September 1, 2019, the Company entered into an Executive Chairman Agreement with Rani R. Kohen (as amended, the “2019 Chairman Agreement”) to serve as the Company’s Executive Chairman and Chairman of the board of directors, which superseded Mr. Kohen’s previous chairman agreement effective September 1, 2016. Effective as of January 1, 2022, the Company entered into a new Executive Chairman Agreement with Mr. Kohen (the “Chairman Agreement”), which superseded the 2019 Chairman Agreement and contains substantially the same terms. The Chairman Agreement provides that Mr. Kohen will serve for an initial term of three years and that the Chairman Agreement will automatically renew unless Mr. Kohen or the board of directors decide otherwise. Subject to other customary terms and conditions of such agreements, the Chairman Agreement provides that Mr. Kohen will receive: (i) a base salary of $300,000 per year commencing January 1, 2022 (an increase from $250,000 per year under the 2019 Chairman Agreement), which will be increased by the Company in the event the Company has a significant cash raise; (ii) annual equity compensation consisting of options to purchase 1,020,000 shares of common stock at an exercise price of $12.00 per share, which vest in three equal annual instalments on each of January 1, 2023, 2024 and 2025 (subject to certain exceptions) and have a five-year term; (iii) a sign-on bonus stock option to purchase 120,000 shares of common stock at an exercise price of $12.00 per share, which vested in its entirety on January 1, 2023 and has a five-year term; (iv) supplemental bonus compensation of stock options to purchase up to 6,000,000 shares of common stock at an exercise price ranging between $6.00 and $8.00 per share, determined based on the achievement of specified market capitalizations of the Company, as described further below, which have a five-year term; (v) supplemental bonus compensation such that, in the event the Company achieves a $10.0 billion valuation, for each valuation increase of $1.0 billion up to $30.0 billion Company valuation, Mr. Kohen will receive an option to purchase 500,000 shares at an exercise price of $12.00 per share; and (vi) incentive compensation equal to 0.5% of the Company’s gross revenue, which will be paid in cash, stock and/or options on an annual basis. In the event the Company exceeds a $30.0 billion valuation, the Company and Mr. Kohen will negotiate a mutually acceptable amendment to the Chairman Agreement. 59 Mr. Kohen is eligible for the following supplemental bonus compensation under the Chairman Agreement (in addition to the supplemental bonus compensation described in clause (v) above): (i) options to purchase 500,000 shares of common stock at an exercise price of $6.00 per share, upon the Company achieving each of the following market capitalizations: $500.0 million, $1.0 billion, $1.5 billion and $2.0 billion; (ii) options to purchase 500,000 shares of common stock at an exercise price of $7.00 per share, upon the Company achieving each of the following market capitalizations: $3.0 billion, $4.0 billion, $5.0 billion and $6.0 billion; and (iii) options to purchase 500,000 shares of common stock at an exercise price of $8.00 per share, upon the Company achieving each of the following market capitalizations: $7.0 billion, $8.0 billion, $9.0 billion and $10.0 billion. As of December 31, 2025, the following previously vested, and expired during 2024: (i) options to purchase 1.5 million shares at an exercise price of $3.00 per share; (ii) options to purchase 500,000 shares at an exercise price of $4.00 per share; and (iii) options to purchase 1.0 million shares at an exercise price of $6.00 per share. Mr. Kohen is also entitled to receive a car allowance of $1,000 per month, reimbursement for cell phone costs and expense reimbursement for reasonable expenses, including travel and entertainment, incurred in the performance of his duties. In addition, in the event Mr. Kohen invents additional new products and applications for the Company, including products based on the Company’s existing intellectual property, Mr. Kohen will be entitled to receive additional compensation, which will be determined by the board of directors. Pursuant to the Chairman Agreement, Mr. Kohen may be terminated for “cause,” which is defined as an act of fraud, embezzlement or theft; a material violation of the Chairman Agreement by Mr. Kohen that is not cured within 60 days of written notice; and Mr. Kohen’s death, disability or incapacity. During the initial term of the Chairman Agreement, if Mr. Kohen is terminated without cause, (i) the Company will pay Mr. Kohen an amount calculated by multiplying Mr. Kohen’s monthly salary at the time of such termination by the number of months remaining in the initial term; (ii) Mr. Kohen’s annual equity compensation will vest on a pro rata basis; and (iii) Mr. Kohen will receive full payment of all unpaid incentive compensation. Following the expiration of the initial term, the Chairman Agreement may be terminated by the board of directors at its discretion, in which case Mr. Kohen will receive full payment for all incentives and will be entitled to compensation for his invented products. Mr. Kohen may terminate the Chairman Agreement at his discretion by providing at least 90 days’ prior written notice to the Company. In the event Mr. Kohen’s employment is terminated by reason of his death, the Company will pay Mr. Kohen’s beneficiaries 12 months of Mr. Kohen’s base salary or Mr. Kohen’s base salary through the remainder of the year in which Mr. Kohen’s death occurs, whichever is greater, and all annual stock compensation, incentive compensation and supplemental bonus compensation due to Mr. Kohen will be bequeathed to his beneficiaries. In the event the Company is acquired, is the non-surviving party in a merger or sells all or substantially all of its assets, the Chairman Agreement will not be terminated, and the Company will ensure that the transferee or surviving company is bound by the provisions of the Chairman Agreement. All shares granted and any other compensation will vest and be paid immediately. Patricia Barron (Chief Operations Officer) Effective September 1, 2019, the Company entered into an Executive Employment Agreement with Patricia Barron, its Chief Operations Officer (the “Barron Agreement”), which superseded Ms. Barron’s previous employment agreement effective July 1, 2016. The Barron Agreement provided for an initial term of one year, which term may be, and has been, renewed by the mutual agreement of Ms. Barron and the Company. Subject to other customary terms and conditions of such agreements, the Barron Agreement provides that Ms. Barron will receive: (i) a base salary of $150,000 per year, which may be adjusted each year at the discretion of the board; and (ii) a sign-on bonus of a stock option to purchase 100,000 shares of common stock at an exercise price of $6.00 per share, which vested in its entirety on December 31, 2020. Ms. Barron was previously eligible to receive cash incentive compensation equal to 0.25% of the Company’s net revenue, payable on an annual or quarterly basis. In March 2024, Ms. Barron entered into a commission termination agreement, terminating the incentive compensation-related provisions in her employment agreement and agreeing no amounts would be paid pursuant to such provisions for prior periods. Ms. Barron is also entitled to receive expense reimbursement for reasonable expenses, including travel and entertainment, incurred in the performance of her duties. Pursuant to the Barron Agreement, Ms. Barron may be terminated for “cause,” which is defined as an act of fraud, embezzlement, theft or neglect of or refusal to substantially perform the duties of her employment that is materially injurious to the financial condition or business reputation of the Company; a material violation of the Barron Agreement by Ms. Barron that is not cured within 30 days of written notice; and Ms. Barron’s death, disability or incapacity. Following the expiration of the initial term, the Barron Agreement may be terminated by the board of directors at its discretion, in which case Ms. Barron will receive one month of her then-applicable annual base salary for every year of employment by the Company, as well as any unpaid incentive compensation. In addition, Ms. Barron may terminate the Barron Agreement at her discretion by providing at least 30 days’ prior written notice to the Company. 60 In the event the Company is acquired, is the non-surviving entity in a merger or sells all or substantially all of its assets, the Barron Agreement will survive, and the Company will use its best efforts to ensure that the transferee or surviving company is bound by the provisions of the Barron Agreement. All shares granted will vest immediately. Steven M. Schmidt (President) Effective December 20, 2024, the Company entered into a three-year employment agreement with Steven M. Schmidt, pursuant to which Mr. Schmidt agreed to serve as the Company’s President (the “Schmidt Agreement”). Subject to other customary terms and conditions of such agreements, Mr. Schmidt received the following awards as compensation for his service as President: (i) a grant of 250,000 RSUs and five-year options to purchase up to 250,000 shares of common stock, each of which vested as to 10,000 RSUs or options on December 20, 2024, with the remaining 240,000 RSUs or options vesting in equal quarterly instalments of 20,000 RSUs or options beginning on December 31, 2024; and (ii) a grant of 100,000 RSUs and five-year options to purchase up to 100,000 shares of common stock, each of which vests in two equal annual instalments on January 1, 2025 and January 1, 2026. Mr. Schmidt may receive additional equity grants or other bonus or other incentive compensation, as determined by the Company. Mr. Schmidt is also entitled to up to four weeks of vacation per year and to receive expense reimbursement for reasonable expenses, approved in advance in writing by the Company, incurred in the performance of his duties. The Schmidt Agreement includes customary confidentiality and intellectual property provisions and post-employment non-solicitation and non-competition covenants. The Schmidt Agreement provides for a term ending December 31, 2027 and may be terminated by either party at any time, for any reason, upon 30 days’ written notice or immediately and without notice in the event of any breach or default of a material term or condition of the Schmidt Agreement that is not remedied or cured within ten days after delivery of written notice thereof. Any portion of an award that has not vested as of the date Mr. Schmidt ceases to be an employee of the Company will be forfeited and terminated automatically. Marc-Andre Boisseau (Chief Financial Officer) Effective January 1, 2022, the Company entered into an employment agreement with Marc-Andre Boisseau, pursuant to which Mr. Boisseau agreed to serve as the Company’s Chief Financial Officer (the “Boisseau Agreement”). Subject to other customary terms and conditions of such agreement, the Boisseau Agreement provides that Mr. Boisseau: (i) receives a base salary of $144,000 per year, subject to annual review and adjustment;; and (ii) will be eligible to receive performance-based compensation in the form of a bonus, payable in equity and/or cash, as determined by the compensation committee, subject to the achievement of performance metrics and other criteria as determined by the Executive Chairman and approved by the compensation committee. Mr. Boisseau is also entitled to receive expense reimbursement for reasonable expenses, approved in writing by the Executive Chairman and Chief Executive Officer, incurred in the performance of his duties. The Boisseau Agreement also contains customary non-competition and non-solicitation covenants and does not provide for any specified severance benefits. The Boisseau Agreement provides that Mr. Boisseau’s employment is “at will,” and either party may terminate his employment at any time and for any reason, without cause, upon 90 days’ advance written notice. Stock Incentive Plans 2021 Stock Incentive Plan (as Amended and Restated) The 2021 Plan was originally adopted by our board of directors in December 2021 and approved by our stockholders in February 2022 and became effective February 9, 2022. On July 10, 2024, our stockholders approved the amendment and restatement of the 2021 Plan, increasing the number of shares authorized for issuance under the 2021 Plan by 20,000,000 shares. The 2021 Plan is the successor to the Company’s 2018 Stock Incentive Plan (as amended and restated, the “2018 Plan”), and no further awards may be granted under the 2018 Plan. The following provides a summary of the 2021 Plan. Eligibility and Types of Awards The 2021 Plan authorizes the grant of equity-based compensation awards to those employees of, and consultants to, the Company and its subsidiaries who are selected by the compensation committee, and the 2021 Plan also authorizes the compensation committee to grant awards to non-employee directors of the Company. Awards under the 2021 Plan may be granted in the form of stock options, stock appreciation rights (sometimes referred to as “SARs”), restricted shares, RSUs, and other share-based awards. 61 Administration The compensation committee, which is comprised of non-employee directors, will administer awards granted under the 2021 Plan. To the extent permitted by applicable law, the compensation committee may delegate its authority to one or more officers or directors of the Company. Further, the board of directors may reserve to itself any of the compensation committee’s authority and may act as the administrator of the 2021 Plan. Shares Available Subject to adjustments as described below, the total number of shares that may be delivered under the 2021 Plan will not exceed 40,000,000 shares (all of which potentially may be issued pursuant to awards of incentive stock options). Shares tendered or withheld to pay the exercise price of a stock option or to cover tax withholding, and shares repurchased by the Company with stock option proceeds, will not be added back to the number of shares available under the 2021 Plan. Upon exercise of any stock appreciation right that may be settled in shares, the full number of shares subject to that award will be counted against the number of shares available under the 2021 Plan, regardless of the number of shares used to settle the stock appreciation right upon exercise. To the extent that any award under the 2021 Plan or any award granted under the 2018 Plan prior to the effectiveness of the 2021 Plan is forfeited, cancelled, surrendered, or terminated without the issuance of shares or an award is settled only in cash, the shares subject to such awards granted but not delivered will be added to the number of shares available for awards under the 2021 Plan. Shares available for awards under the 2021 Plan may consist of authorized and unissued shares, treasury shares (including shares purchased by the Company in the open market) or a combination of the foregoing. Stock Options Subject to the terms and provisions of the 2021 Plan, options to purchase shares may be granted to eligible individuals at any time and from time to time as determined by the compensation committee. Options may be granted as incentive stock options (to employees only) or as nonqualified stock options. The compensation committee will determine the number of options granted to each recipient. Each option grant will be evidenced by an award agreement that specifies whether the options are intended to be incentive stock options or nonqualified stock options and such additional limitations, terms and conditions as the compensation committee may determine, consistent with the provisions of the 2021 Plan. The exercise price for each stock option may not be less than 100% of the fair market value of a share of common stock on the date of grant, and each stock option shall have a term no longer than 10 years. Stock options granted under the 2021 Plan may be exercised by such methods and procedures as determined by the compensation committee from time to time. Stock Appreciation Rights The compensation committee in its discretion may grant SARs under the 2021 Plan. A SAR entitles the holder to receive from the Company upon exercise an amount equal to the excess, if any, of the aggregate fair market value of a specified number of shares that are the subject of such SAR over the aggregate exercise price for the underlying shares. The exercise price for each SAR may not be less than 100% of the fair market value of a share on the date of grant, and each SAR shall have a term no longer than 10 years. The Company may make payment in settlement of the exercise of a SAR by delivering shares, cash or a combination of shares and cash as set forth in the applicable award agreement. Each SAR will be evidenced by an award agreement that specifies the date and terms of the award and such additional limitations, terms and conditions as the compensation committee may determine, consistent with the provisions of the 2021 Plan. Restricted Shares Under the 2021 Plan, the compensation committee may grant or sell restricted shares to participants (i.e., shares that are subject to a substantial risk of forfeiture based on continued service and/or the achievement of performance objectives and that are subject to restrictions on transferability) under the 2021 Plan. Except for these restrictions and any others imposed by the compensation committee, upon the grant of restricted shares, the recipient generally will have rights of a stockholder with respect to the restricted shares, including the right to vote the restricted stock and to receive dividends and other distributions paid or made with respect to the restricted shares. However, any dividends payable with respect to unvested restricted shares will be accumulated or reinvested in additional restricted shares until the vesting of the award. During the applicable restriction period, the recipient may not sell, transfer, pledge, exchange or otherwise encumber the restricted shares. Each award of restricted shares will be evidenced by an award agreement that specifies the terms of the award and such additional limitations, terms and conditions, which may include restrictions based upon the achievement of performance objectives, as the compensation committee may determine. 62 Restricted Share Units The compensation committee may grant or sell RSUs to participants under the 2021 Plan. RSUs constitute an agreement to deliver shares (or an equivalent value in cash) to the participant at the end of a specified restriction period and/or upon the achievement of specified performance objectives, subject to such other terms and conditions as the compensation committee may specify, consistent with the provisions of the 2021 Plan. RSUs are not common shares and do not entitle the recipients to any of the rights of a stockholder. RSUs will be settled in cash, shares or a combination of cash and shares. Each RSU award will be evidenced by an award agreement that specifies the terms of the award and such additional limitations, terms and conditions as the compensation committee may determine, which may include restrictions based upon the achievement of performance objectives. Other Share-Based Awards The compensation committee may grant other share-based awards to participants under the 2021 Plan. Other share-based awards are awards that are valued in whole or in part by reference to shares of common stock, or are otherwise based on the value of the common stock, such as unrestricted shares or time-based or performance-based units that are settled in shares and/or cash. Each other share-based award will be evidenced by an award agreement that specifies the terms of the award and such additional limitations, terms and conditions as the compensation committee may determine, consistent with the provisions of the 2021 Plan. Dividend Equivalents As determined by the compensation committee in its discretion, RSUs and other share-based awards may provide the participant with a deferred and contingent right to receive dividend equivalents, either in cash or in additional shares. Any such dividend equivalents will be accumulated or deemed reinvested until such time as the underlying award becomes vested (including, where applicable, vesting based on the achievement of performance objectives). No dividend equivalents may be granted with respect to shares underlying any stock option or SAR. Change in Control If a participant is a party to an employment, retention, change in control, severance or similar agreement with the Company or a subsidiary that addresses the effect of a change in control on the participant’s awards, then that agreement will control the treatment of the participant’s awards under the 2021 Plan in the event of a change in control. In all other cases, the compensation committee retains the discretion to determine the treatment of awards granted under the 2021 Plan in the event of a change in control. For example, the compensation committee may determine (without the consent of any participant) to accelerate the vesting of any award (in whole or in part), to make cash payments in cancellation of vested awards, or to cancel any stock options or SARs without consideration if the price per share in the change of control transaction does not exceed the exercise price per share of the applicable award. The 2021 Plan generally defines a change in control to include the acquisition of more than 50% of the Company’s then-outstanding common stock, other than acquisitions directly from, or by, the Company or by any employee benefit plan sponsored or maintained by the Company, and the consummation of a reorganization, merger, consolidation, sale or other disposition of all or substantially all of the Company’s assets, unless, following such transaction, the Company’s stockholders own more than 50% of the common stock of the resulting entity in substantially the same proportions as their ownership of the Company’s common stock prior to the transaction, no stockholder beneficially owns, directly or indirectly, 50% or more of the outstanding common stock of the entity resulting from such transaction (except to the extent that such ownership existed prior to the transaction), and at least a majority of the members of the board of directors of the resulting entity were members of the Company’s board of directors at the time of the transaction. The 2021 Plan contains the complete, detailed definition of change in control. Adjustments In the event of any equity restructuring, such as a stock dividend, stock split, spin-off, rights offering or recapitalization through a large, nonrecurring cash dividend, the compensation committee will adjust the number and kind of shares that may be delivered under the 2021 Plan, the number and kind of shares subject to outstanding awards and the exercise price or other price of shares subject to outstanding awards, to prevent dilution or enlargement of rights. In the event of any other change in corporate capitalization, or in the event of a merger, consolidation, liquidation or similar transaction, the compensation committee may, in its discretion, make such an equitable adjustment, to prevent dilution or enlargement of rights. However, unless otherwise determined by the compensation committee, the number of shares subject to any award will always be rounded down to a whole number. Moreover, in the event of any such transaction or event, the compensation committee, in its discretion, may provide in substitution for any or all outstanding awards such alternative consideration (including cash) as it, in good faith, may determine to be equitable in the circumstances and may require in connection therewith the surrender of all awards so replaced. 63 The compensation committee, in its sole discretion, may also provide at any time for the exercisability of outstanding stock options and SARs, the lapse of time-based vesting restrictions and the satisfaction of performance objectives applicable to outstanding awards, or the waiver of any other limitation or requirement under any awards. Transferability Except as the compensation committee otherwise determines, awards granted under the 2021 Plan will not be transferable by a participant other than by will or the laws of descent and distribution. Except as otherwise determined by the compensation committee, stock options and SARs will be exercisable during a participant’s lifetime only by him or her or, in the event of the participant’s incapacity, by his or her guardian or legal representative. Any award made under the 2021 Plan may provide that any shares issued as a result of the award will be subject to further restrictions on transfer. No Repricing of Stock Options or Stock Appreciation Rights Except in connection with an adjustment involving a change in capitalization or other corporate transaction or event as provided for in the 2021 Plan, the compensation committee may not authorize the amendment of any outstanding stock option or stock appreciation right to reduce the exercise price, and no outstanding stock option or stock appreciation right may be cancelled in exchange for stock options or stock appreciation rights having a lower exercise price, or for another award or for cash, without the approval of the Company’s stockholders. Compensation Recovery Policy Awards granted under the 2021 Plan are subject to forfeiture or recoupment pursuant to the Company’s Compensation Recovery Policy. Term of the 2021 Plan; Amendment and Termination No awards may be granted under the 2021 Plan on or after February 9, 2032 (the tenth anniversary of the effective date of the 2021 Plan), or such earlier date as the 2021 Plan may be terminated by the board of directors. The board of directors may, without stockholder approval, amend or terminate the 2021 Plan, except in any respect as to which stockholder approval is required by the 2021 Plan, by law, regulation or the rules of an applicable stock exchange. 2018 Stock Incentive Plan (as Amended and Restated) The board of directors initially approved the 2018 Plan on April 26, 2018, and in each of August 2019 and November 2021, the board of directors approved the amendment and restatement of the 2018 Plan. The Company no longer grants awards under the 2018 Plan as it was replaced by the 2021 Plan. However, any outstanding awards under the 2018 Plan continue to be governed by their existing terms. If the Company is merged or consolidated with another entity or sells or otherwise disposes of substantially all of its assets to another company while options or stock awards remain outstanding under the 2018 Plan, unless provisions are made in connection with such transaction for the continuance of the 2018 Plan and/or the assumption or substitution of such options or stock awards with new options or stock awards covering the stock of the successor company, or parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices, then all outstanding options and stock awards that have not been continued or assumed, or for which a substituted award has not been granted, will, whether or not vested or then exercisable, unless otherwise specified in the stock option or stock award agreement, terminate immediately as of the effective date of any such merger, consolidation or sale. 2015 Stock Incentive Plan The Company previously granted equity awards under the 2015 Stock Incentive Plan, which contained substantially the same terms as the 2018 Plan, described above. The Company no longer grants awards under the 2015 Stock Incentive Plan as it was replaced by the 2018 Plan. However, any outstanding awards under the 2015 Stock Incentive Plan continue to be governed by their existing terms. 64 Termination or Change in Control Benefits Our named executive officers may become entitled to certain benefits or enhanced benefits in connection with a qualifying termination and/or a change in control of our Company. Our named executive officers’ employment agreements entitle them to certain benefits upon certain terminations or in connection with a change in control of the Company. For additional discussion, see “Agreements with Named Executive Officers” above. Each of our named executive officers holds equity awards that were granted subject to the general terms and termination and change in control provisions of our stock incentive plans. The forms of agreements governing outstanding awards granted under the plans contain additional such provisions. For additional discussion, please see “Stock Incentive Plans” above. Compensation Recovery Policy During 2023, the board of directors adopted the Company’s Compensation Recovery Policy to comply with SEC and Nasdaq rules for the claw back of certain executive compensation in the event that we are required to prepare a restatement of our financial statements due to material noncompliance with any financial reporting requirement under the securities laws. In the event of such a restatement, the Compensation Recovery Policy provides that the compensation committee will cause the Company to promptly recover any erroneously awarded incentive-based compensation received by any covered executive officer during the three completed fiscal years immediately preceding the date on which the Company is required to prepare the accounting restatement. Covered executive officers include both current and former executive officers, and incentive-based compensation includes any compensation that is granted, earned, or vested based wholly or in part on the attainment of a financial reporting measure. Financial reporting measures are those that are determined and presented in accordance with the accounting principles used in preparing our financial statements, and any measures that are derived wholly or in part from such measures. The amount required to be recovered under the Compensation Recovery Policy in the event of an accounting restatement generally will equal the amount of incentive-based compensation received by the covered executive officer that exceeds the amount of such compensation that otherwise would have been received had it been determined based on the restated amounts, computed without regard to any taxes paid. The Compensation Recovery Policy is effective with respect to covered incentive-based compensation received by a covered executive officer on or after October 2, 2023. Policies and Practices Related to the Grant of Certain Equity Awards We do not schedule the grant of stock options or other equity awards in anticipation of the disclosure of material nonpublic information, and we do not schedule the disclosure of material nonpublic information based on the timing of grants of stock options or other equity awards. We have not adopted any formal policy that would require the compensation committee or the board to grant, or to avoid granting, stock options or other equity awards to our named executive officers or other employees at certain times. During the year ended December 31, 2025, we did not award options to any of our named executive officers during the period beginning four business days before and ending one business after the filing of a periodic report on Form 10-Q or Form 10-K or the filing or furnishing of a Current Report on Form 8-K that discloses material nonpublic information, except as included in the table below. Under our Director Compensation Program (described below under the heading “Director Compensation”), annual awards of stock options and restricted stock are granted to our non-employee directors on the third trading day after the earlier of the date of the earnings release or the date the annual report is filed on Form 10-K. Name Grant Date Number of securities underlying the award Exercise price of the award ($/Share) Grant date fair value of the award Percentage change in the closing market price of the securities underlying the award between the trading day ending immediately prior to the disclosure of material nonpublic information and the trading day beginning immediately following the disclosure of material nonpublic information Rani Kohen 12/8/2025 1,500,000 $ 2.42 $ 2,269,500 -0.8 % DIRECTOR COMPENSATION Director Compensation Under the director compensation program approved by the board in March 2023 (the “Director Compensation Program”), for service on our board, non-employee directors receive an annual cash retainer of $30,000, paid in quarterly instalments, or, if a director elects to receive payment in shares of common stock, a single annual distribution of common stock. For 2024, shares were granted on December 31, 2024, with the number of shares granted determined based on the opening price per share of common stock on Nasdaq on December 31, 2024. Messrs. Ridge and Shiff each elected to receive their 2024 annual cash retainer in shares of common stock. For 2025, all shares will be granted on December 31, 2025, with the number of shares granted to be determined based on the opening price per share of common stock on Nasdaq on such date. Messrs. Ridge and Shiff have each elected to receive their 2025 annual cash retainer in shares of common stock. For 2026, all shares will be granted on December 31, 2026, with the number of shares granted to be determined based on the opening price per share of common stock on Nasdaq on such date. Messrs. Ridge and Shiff have each elected to receive his 2026 annual cash retainer in shares of common stock. In addition, on the third trading day after the earlier of the date of the earnings release or the date the annual report is filed on Form 10-K (the “Program Grant Date”), non-employee directors receive an annual grant of (i) 5,000 shares of restricted stock, which vest immediately on the Program Grant Date, and (ii) options to purchase up to 5,000 shares of common stock with an exercise price equal to the closing price of common stock on Nasdaq on the Program Grant Date, which will vest in twelve equal monthly instalments beginning on the last day of the month in which the options were granted and expire five years from the Program Grant Date. 65 For service as a member of the audit committee, compensation committee and/or nominating and corporate governance committee, non-employee directors each receive an additional annual grant of (i) 3,000 shares of restricted stock, which vest immediately on the Program Grant Date, and (ii) options to purchase up to 3,000 shares of common stock with an exercise price equal to the closing price of common stock on Nasdaq on the Program Grant Date, which will vest in twelve equal monthly instalments beginning on the last day of the month in which the options were granted and expire five years from the Program Grant Date. For service as the Chair of the audit committee, compensation committee and/or nominating and corporate governance committee, non-employee directors each receive an additional annual grant of (i) 2,000 shares of restricted stock, which vest immediately on the Program Grant Date, and (ii) options to purchase up to 2,000 shares of common stock with an exercise price equal to the closing price of common stock on Nasdaq on the Program Grant Date, which will vest in twelve equal monthly instalments beginning on the last day of the month in which the options were granted and expire five years from the Program Grant Date. For non-employee members of the business strategy and development committee of the board, non-employee directors each receive an additional annual grant of (i) 12,500 shares of restricted stock, which vest immediately on the Program Grant Date, and (ii) options to purchase up to 12,500 shares of common stock with an exercise price equal to the closing price of common stock on Nasdaq on the Program Grant Date, which will vest in twelve equal monthly installments beginning on the last day of the month in which the options were granted and expire five years from the Program Grant Date. Non-employee directors also receive reimbursement of reasonable out-of-pocket expenses for attending meetings and carrying out duties as board members. Director Compensation Table The following table summarizes the compensation paid to each non-employee director who served during 2025. All compensation earned by Messrs. Kohen and Sokolow during 2025 has been reported in the “Summary Compensation Table” above under “Executive Compensation.” Name Fees earned or paid in cash ($) Stock awards ($) (1) Option awards ($) (1) Non-equity incentive plan compensation ($) Nonqualified deferred compensation earnings ($) All other compensation ($) Total ($) Nancy DiMattia 30,000 33,390 20,962 - - - 84,352 Gary N. Golden 30,000 22,680 14,238 - - - 66,918 Efrat L. Greenstein Brayer 30,000 20,160 12,666 - - - 62,826 Thomas J. Ridge - 37,597 3,956 - - - 41,553 Dov Shiff - 37,597 3,956 - - - 41,553 (1) The table reflects the grant date fair value, as computed in accordance with Topic 718, of the restricted share awards and options granted to directors in 2025. The assumptions used to determine the valuation of the awards are discussed in Note 2 and Note 11 to our consolidated financial statements for the 2025 fiscal year. All stock options reported in the table above were granted with an exercise price of $0.79 per share and vest in twelve equal monthly instalments beginning March 2025. There were no unvested stock awards held by non-employee directors as of December 31, 2025. The total number of unexercised option awards (vested and unvested) held by our non-employee directors as of December 31, 2025 was as follows: Ms. DiMattia, 87,500 options; Mr. Golden, 64,000 options; Ms. Greenstein Brayer, 57,000 options; Mr. Ridge, 545,000 options; and Mr. Shiff, 45,000 options. 66 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following table sets forth certain information known to us regarding beneficial ownership of our issued and outstanding common stock as of March 18, 2026 for: ● each of our named executive officers; ● each of our directors; ● all of our executive officers and directors as a group; and ● each person or group of affiliated persons known by us to be the beneficial owner of more than 5% of our common stock, Series A Preferred Stock, Series A-1 Preferred Stock or Series A-2 Preferred Stock. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Under those rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting power or investment power and includes securities that the individual or entity has the right to acquire, such as through the exercise of issued stock options or warrants, vesting of RSUs, or conversion of convertible notes or preferred stock, within 60 days of March 18, 2026. Except as noted by footnote, and subject to community property laws where applicable, we believe, based on the information provided to us, that the persons and entities named in the table below have sole voting and investment power with respect to all common stock shown as beneficially owned by them. The percentage of beneficial ownership of common stock is based on 133,281,119 shares of common stock issued and outstanding as of March 18, 2026. The percentage of beneficial ownership of Series A Preferred Stock, Series A-1 Preferred Stock and Series A-2 Preferred Stock is based on 200,000 shares, 253,000 shares and 60,000 shares, respectively, issued and outstanding as of March 18, 2026. The percentage of total voting power is based on the shares of common stock issued and outstanding as of March 18, 2026, plus the shares of common stock issuable upon the conversion of the Series A Preferred Stock, Series A-1 Preferred Stock and Series A-2 Preferred Stock issued and outstanding as of March 18, 2026 based on the conversion price in effect for the preferred stock on March 18, 2026. Shares of our common stock that are subject to options or warrants exercisable, RSUs vesting, or notes or preferred stock convertible within 60 days of March 18, 2026 are deemed to be outstanding for computing the percentage ownership of common stock and total voting power of the person holding such options, warrants, RSUs, notes and/or preferred stock and the percentage ownership of any group in which the holder is a member, but are not deemed outstanding for computing the percentage of any other person, except that total voting power includes the shares of common stock issuable upon conversion of the Series A Preferred Stock, Series A-1 Preferred Stock and Series A-2 Preferred Stock in determining percentage ownership, as noted above. Except as otherwise indicated below, the address of each beneficial owner is c/o SKYX Platforms Corp., 2855 W. McNab Road, Pompano Beach, Florida 33069. Name of Beneficial Owner Number of Shares of Common Stock Beneficially Owned Percentage of Class Number of Shares of Series A Preferred Stock Beneficially Owned Percentage of Class Number of Shares of Series A-1 Preferred Stock Beneficially Owned Percentage of Class Number of Shares of Series A-2 Preferred Stock Beneficially Owned Percentage of Class Total Voting Power Greater than 5% Stockholders Dov Shiff, Director (1) 5,483,237 11.76 % - - - - - - 10.8 % Rani R. Kohen, Executive Chairman and Director (2) 1,899,970 8.8 % - - - - - - 8.2 % Strul Associates Limited Partnership (3) 6,763,162 4.9 % - - 20,000 7.9 % - - 4.9 % SKY Opportunity I LLC (4) 200,000 * 200,000 100.0 % - - - - 3.1 % Steven Siegelaub (5) 3,134,534 2.3 % - - 40,000 15.8 % - - 2.8 % Michael and Zelene Fowler (6) 1,393 * - - 40,000 15.8 % 52,000 86.7 % 1.0 % MSD Family Partners II (7) 21 * - - - - 8,000 13.3 % * Freeman Caribbean Investments, LLC (8) 290,000 * - - 20,000 7.9 % - - * Harry & Brenda Mittelman Revocable Living Trust (9) 2,123,166 1.6 % - - 14,000 5.5 % - - 1.7 % Steven M. Schmidt, President (10) 673,664 * - - 20,000 7.9 % - - * Directors and Named Executive Officers (not otherwise included above) - - - Leonard J. Sokolow, Co-Chief Executive Officer, Director (11) 1,784,075 1.3 % - - 10,000 4.0 % - - 1.4 % Marc-Andre Boisseau (12) 212,607 * - - - - - - * Thomas J. Ridge, Director (13) 1,608,193 1.2 % - - - - - - 1.1 % Patricia Barron, Chief Operations Officer (14) 648,987 * - - - - - - * Nancy DiMattia, Director (15) 198,770 * - - - - - - * Gary N. Golden, Director (16) 128,000 * - - - - - - * Efrat L. Greenstein Brayer, Director (17) 114,000 * - - - - - - * All directors and current executive officers as a group (10 persons) (18) 32,751,503 23.6 % - - 30,000 11.9 % - 23.2 % * Represents beneficial ownership of less than one percent. 67 (1) Based on a Form 4 and Schedule 13D/A filed by Mr. Shiff on January 2, 2026 and January 27, 2026, respectively. Includes 13,274,618 shares of common stock held by DZDLUX s.a.r.l., of which Mr. Shiff is a controlling person, 235,712 shares of common stock held by Shiff Group Assets Ltd., of which Mr. Shiff is a controlling person, 379,955 shares held by Shiff Group Investments Ltd., of which Mr. Shiff is the President and Chief Executive Officer, 1,507,952 shares of common stock held directly by Mr. Shiff, and 40,000 shares held by Mr. Shiff’s spouse. Also includes 45,000 shares of common stock underlying stock options held by or vesting to Mr. Shiff that are exercisable within 60 days of March 18, 2026. As a result of his positions at DZDLUX s.a.r.l, Shiff Group Assets Ltd. and Shiff Group Investments Ltd., Mr. Shiff may be deemed to be the beneficial owner of the shares held by such entities and have voting and dispositive power over such shares. (2) Based on a Form 4 and Schedule 13D/A filed by Mr. Kohen on December 12, 2025 and January 28, 2026, respectively. Includes 16,001 shares of common stock held directly by Mr. Kohen, 9,143,969 shares of common stock held by KRNB Holdings LLC and 100,000 shares of common stock held by Mr. Kohen’s family member, as well as 2,640,000 shares of common stock underlying stock options are held by or vesting to Mr. Kohen that are exercisable within 60 days of March 18, 2026. As manager of KRNB Holdings LLC, Mr. Kohen may be deemed to be the beneficial owner of the shares held by KRNB Holdings LLC and have voting and dispositive power over such shares. (3) Includes 416,667 shares of common stock issuable upon conversion of Series A-1 Preferred Stock held by Strul Associates Limited Partnership (“SALP”), 5,000,000 shares of common shares of common stock underlying a convertible promissory note held by SALP that are exercisable within 60 days of March 18, 2026, which contain a provision limiting the issuance of shares upon conversion to not exceed 4.99% of the Company’s issued and outstanding shares of common stock, 125,000 shares of common stock issuable upon exercise of an outstanding warrant held by SALP, 988,162 shares of common stock held by held by SALP, 325,000 shares of common stock held by Aubrey Strul, and 325,000 shares of common stock underlying stock options held by or vesting to Mr. Strul that are exercisable within 60 days of March 18, 2026. Aubrey Strul, the manager of Strul Associates LLC, the general partner of SALP, may be deemed to be the beneficial owner of the shares held by SALP and has voting and dispositive power over such shares. The address of Mr. Strul and SALP is 20320 Fairway Oaks Drive, #362, Boca Raton, Florida 33434. (4) Includes 4,166,667 shares of common stock issuable upon conversion of Series A Preferred Stock held by SKY Opportunity I LLC, 100,000 shares of common stock held by Lance T. Shaner or vesting within 60 days of March 18, 2026, and 100,000 options held by Mr. Shaner that are exercisable within 60 days of March 18, 2026. Mr. Shaner, the Manager of Shaner Sky LLC, which is the Manager of SKY Opportunity I LLC, may be deemed to be the beneficial owner of the shares held by SKY Opportunity I LLC and to have voting and dispositive power over such shares. The address for SKY Opportunity I LLC and Mr. Shaner is 1965 Waddle Road, State College, Pennsylvania 16803. (5) Includes 833,334 shares of common stock issuable upon conversion of Series A-1 Preferred Stock held by Steven Siegelaub. Also includes 831,926 shares held by Safety Investors 2014 LLC, 1,016,591 shares held by Investment 2013, LLC, 104,622 shares held by 301 Office Ventures, LLC, 87,424 shares held by Enterprises 2013, LLC, 719,521 shares held by Investment 2018 LLC, 60,000 shares held by DRS Real Estate Ventures LLC, 92,872 shares held jointly by Mr. Siegelaub and his spouse, 63,244 shares held by Mr. Siegelaub, 58,334 shares of common stock issuable upon conversion of the principal amount of an outstanding convertible note held by Sky Technology Partners, LLC, and 100,000 shares of common stock underlying stock options held jointly by Mr. Siegelaub and his spouse that are exercisable within 60 days of March 18, 2026. As the managing member of each of 301 Office Ventures, LLC, Enterprises 2013, LLC, Investment 2013 LLC, Safety Investors 2014 LLC, Investment 2018 LLC, DRS Real Estate Ventures LLC and Sky Technology Partners, LLC, Mr. Siegelaub may be deemed to the beneficial owner of the shares held by such entities and to have voting and dispositive power over such shares. The address of Mr. Siegelaub and his affiliated entities is 361 E. Hillsboro Blvd., Deerfield Beach, Florida 33441. (6) Includes 833,334 shares of common stock issuable upon conversion of Series A-1 Preferred Stock, 650,000 shares of common stock issuable upon conversion of Series A-2 Preferred Stock, and 1,391 shares of common stock held by Michael and Zelene Fowler. The address of Michael and Zelene Fowler is 223 Woodland Grove Court, Westlake Village, California 91362. (7) Includes 100,000 shares of common stock issuable upon conversion of Series A-2 Preferred Stock, and 231 shares of common stock held by MSD Family Partners II. The address for MSD Family Partners II is 12070 Summit Circle, Beverly Hills, California 90210. (8) Includes 416,667 shares of common stock issuable upon conversion of Series A-1 Preferred Stock held by Freeman Caribbean Investments, LLC, 150,000 shares of common stock held by or vesting to Neil Freeman, and 140,000 options held by or vesting to Mr. Freeman that are exercisable within 60 days of March 18, 2026. Neil Freeman, the Manager of Freeman Caribbean Investments, LLC, may be deemed to be the beneficial owner of the shares held by Freeman Caribbean Investments, LLC and to have voting and dispositive power over such shares. The address of Freeman Caribbean Investments, LLC is c/o Aries Capital, 401 W. Ontario St., Suite 220, Chicago, Illinois 60654. (9) Includes 291,667 shares of common stock issuable upon conversion of Series A-1 Preferred Stock held by the Harry & Brenda Mittelman Revocable Living Trust, UA DTD 9/17/2007, of which Harry Mittelman and Brenda Mittelman are the trustees, 177,000 shares held by Mr. Mittelman, 100 shares held by Ms. Mittelman and 1,946,066 shares held by trusts of which Mr. Mittelman or Ms. Mittelman is the trustee or a beneficiary. The address of Mr. Mittelman, Ms. Mittelman and the trusts is 12100 Kate Drive, Los Altos Hills, California 94022. (10) Includes 416,667 shares of common stock issuable upon conversion of Series A-1 Preferred Stock held by Steven Schmidt, 343,664 shares of common stock held by or vesting to Mr. Schmidt, and 330,000 shares of common stock underlying stock options held by or vesting to Mr. Schmidt that are exercisable within 60 days of March 18, 2026. (11) Includes 208,334 shares of common stock issuable upon conversion of Series A-1 Preferred Stock, 766,615 shares of common stock held by or vesting to Mr. Sokolow, 955,000,000 shares of common stock underlying stock options held by or vesting to Mr. Sokolow that are exercisable within 60 days of March 18, 2026, and 83,334 shares of common stock issuable upon conversion of the principal amount of an outstanding convertible note held by Mr. Sokolow. (12) Includes 92,607 shares of common stock and 120,000 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, all held by Mr. Boisseau. (13) Includes 1,063,193 shares of common stock and 545,000 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, all held by or vesting to Mr. Ridge. (14) Includes 282,321 shares of common stock and 266,666 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, all held by or vesting to Ms. Barron. (15) Includes 111,270 shares of common stock and 87,500 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, all held by or vesting to Ms. DiMattia. (16) Includes 64,000 shares of common stock and 64,000 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, all held by or vesting to Mr. Golden. (17) Includes 57,000 shares of common stock and 57,000 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, all held by or vesting to Ms. Greenstein Brayer. (18) Includes 625,001 shares of common stock issuable upon conversion of Series A-1 Preferred Stock, 27,478,877 shares of common stock issued or vesting, 5,210,166 shares of common stock underlying stock options that are exercisable within 60 days of March 18, 2026, and 83,334 shares of common stock issuable upon the conversion of the principal amount of outstanding convertible notes. 68 Changes in Control We are unaware of any contract, or other arrangement or provision, the operation of which may at any subsequent date result in a change in control of our Company. Stock Incentive Plan Information The following table sets forth equity compensation plan information as of December 31, 2025: Plan category (a) Number of securities to be issued upon exercise of outstanding options, warrants and rights (b) Weighted-average exercise price of outstanding options, warrants and rights (3) (c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) Equity compensation plans approved by security holders (1)(2) 36,349,790 $ 6.80 9,707,945 Equity compensation plans not approved by security holders (4) 248,110 $ 1.40 - Total 36,597,900 $ 6.80 9,707,945 (1) Includes 36,349,790 shares of common stock issuable upon exercise of stock options and RSUs granted pursuant to our stock incentive plans and to our Executive Chairman under his employment agreement, all of which were approved by our security holders, at a weighted average exercise price of $6.81 per share, which includes: (a) 1,100,000 shares of common stock issuable upon exercise of stock options granted under the 2015 Stock Incentive Plan; (b) 2,738,500 shares of common stock issuable upon exercise of stock options granted under the 2018 Plan; (c) 11,972,286 shares of common stock issuable upon exercise of stock options granted under the 2021 Plan; (d) 4,539,004 shares of common stock issuable upon vesting of RSUs granted under the 2021 Plan; and (e) 16,000,000 shares of common stock issuable to our Executive Chairman upon vesting and exercise of performance-based stock options granted to our Executive Chairman pursuant to his employment agreement. (2) The 2015 Stock Incentive Plan and 2018 Plan were previously replaced and terminated by the 2018 Plan and the 2021 Plan, respectively, and, as such, no securities remained available for issuance under such plans as of December 31, 2025 and no further awards will be granted under such plans. However, all outstanding awards will continue to be governed by their existing terms. All shares available for future issuance are under the 2021 Plan. (3) Excludes the restricted stock and RSUs referred to in footnote 1 because they have no exercise price. (4) Includes 148,110 shares of common stock issuable upon vesting of shares of restricted stock and 100,000 shares of common stock issuable upon exercise of stock options, granted by the Company’s board of directors in connection with services agreements. Item 13. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS, and Director Independence Director Independence The rules and regulations of The Nasdaq Stock Market LLC (“Nasdaq”) require that a majority of the members of a listed company’s board of directors qualify as “independent,” as affirmatively determined by the company’s board of directors. Based upon information requested from and provided by each director concerning his or her background, employment, and affiliations, including family relationships, our board of directors has determined that all members of the board of directors, except Rani R. Kohen, Dov Shiff and Leonard J. Sokolow, are “independent” as that term is defined under applicable SEC rules and regulations and Nasdaq listing requirements and rules. In making such independence determinations, our board of directors considered the relationships that each non-employee director has with us and all other facts and circumstances that our board of directors deemed relevant in determining their independence, including the transactions described below under “Certain Relationships and Related Party Transactions” and beneficial ownership of our capital stock by each non-employee director. The composition of our board of directors and each of our committees complies with all applicable requirements of Nasdaq and the rules and regulations of the SEC, including applicable independence requirements. 69 Transactions with related persons The following is a description of transactions or series of transactions since January 1, 2024, to which we were or will be a party, in which: ● the amount involved in the transaction exceeds the lesser of (i) $120,000 or (ii) 1% of the average of our total assets at year-end for the last two completed fiscal years; and ● in which any of our executive officers, directors, director nominees or holders of 5% or more of any class of our voting capital stock, or any immediate family member of any of the foregoing, had or will have a direct or indirect material interest. Preferred Stock pursuant to which such investors purchased an aggregate of 240,000 shares of Series A-1 Preferred Stock, at a purchase price of $25.00 per share, and 200,000 shares of Series A Preferred Stock, at a purchase price of $25.00 per share. During 2025, the Company entered into securities purchase agreements pursuant to which accredited investors purchased 154,000 shares of Series A-1 Preferred Stock and 60,000 shares of Series A-2 Preferred Stock, at a purchase price of $25.00 per share. The investors in the private placements have certain registration rights. The Series A Preferred Stock, the Series A-1 Preferred Stock and the Series A-2 Preferred Stock have substantially the same terms. All series of preferred stock have an original issue price of $25.00 per share and are convertible at any time, at the holder’s option, into shares of the Company’s common stock at an adjusted conversion price of $1.20 per share for the Series A Preferred Stock and Series A-1 Preferred Stock (or approximately 20.83 shares of common stock for each share of Series A or A-1 Preferred Stock) or $2.00 per share for the Series A-2 Preferred Stock (or 12.5 shares of common stock for each share of Series A-2 Preferred Stock), subject to adjustment provisions. The terms of the preferred stock provide for cumulative dividends at an annual rate of 8% of the original issue price of $25.00 per share, payable quarterly in arrears; in the event the full cumulative dividends are not paid on a dividend payment date, dividends will accrue on the sum of the original issue price, plus the amount of unpaid dividends, at an annual rate of 12%, until such date as the Company has paid all previously accrued but unpaid dividends. Dividends on Series A Preferred Stock and Series A-1 Preferred Stock are payable in cash. The dividends on Series A-2 Preferred Stock may be paid in cash, or up to 50% of the dividend may be paid in shares of the Company’s common stock, valuing the common stock based on the average closing price per share for the 10 trading days immediately prior to the dividend record date, at the Company’s election, or the full dividend may be paid in shares of Common Stock upon agreement by the Company and the holder. Notwithstanding the foregoing, upon a conversion any accrued and unpaid dividends are payable in shares of the Company’s common stock at the conversion price of the preferred stock being converted. Holders of the preferred stock are also entitled to participate in and receive any dividends declared or paid on the Company’s common stock on an as-converted basis. Until October 4, 2026, the preferred stock is subject to mandatory conversion by the Company upon the occurrence of certain specified events. In addition, the Company may redeem the Series A Preferred Stock and Series A-1 Preferred Stock for cash upon the occurrence of certain events or at any time beginning October 4, 2029 and October 4, 2027, respectively. The preferred stock has no expiration date. The table below sets forth the officers and holders of 5% of more of the Company’s common stock that participated in the offerings, the number of shares of Series A-1 Preferred Stock purchased, and the aggregate purchase price: Name of Related Party Shares of Series A-1 Preferred Stock Purchased Aggregate Purchase Price Leonard J. Sokolow – Chief Executive Officer and director of the Company 10,000 $ 250,000 John P. Campi – Former Co-Chief Executive Officer of the Company 10,000 $ 250,000 Steven M. Schmidt – President of the Company 20,000 $ 500,000 The Company paid dividends to the following parties during 2025: Name of Related Party SKY Opportunity LLC $ 400,000 Notes Payable 2020 Notes During 2020, certain related parties entered into securities purchase agreements with the Company, pursuant to which each agreed to purchase a three-year subordinated convertible promissory note. In March 2024, certain of these related parties entered into an amendment to the note, effective as of the original maturity date of the respective note, which, among other things, extended the maturity date of the note to May 16, 2025. Subject to other customary terms, the note accrues interest at a rate of 6% per annum, or, as amended, 10% per annum effective as of January 1, 2024, which is payable annually in cash or common stock, at the holder’s discretion. At any time after issuance and prior to or on the maturity date, the note is convertible at the option of the holder into shares of common stock at a conversion price of $15.00 per share, or, as amended, $3.00 per share. Upon notice to the holder, the Company may prepay, in whole or in part, the outstanding balance of the note at any time prior to the maturity date; provided that the holder has the right to convert the note into shares of common stock in lieu of prepayment. Upon the occurrence of certain events of default and written notice from the holder, the note will become immediately due and payable and, until paid in full, will bear interest at a rate of 12% per annum. The following table lists the related parties, the remaining principal amount of the note purchased, and the maturity date of the note. In December 2025, the Company entered into an amendment to a convertible promissory note with a principal amount of $600,000 payable to Shiff Group Investments Ltd., which is controlled by Dov Shiff, a director and greater than 5% holder of the Company’s common stock, following which the principal amount, together with accrued interest of $235,900, was converted into 379,955 shares of the Company’s common stock. No interest was paid to Mr. Sokolow and Mr. Campi during 2025. 70 Name of Related Party Principal Amount Purchased Maturity Date Leonard J. Sokolow - Chief Executive Officer and director of the Company $ 250,000 May 16, 2025 John P. Campi – Former Chief Executive Officer $ 250,000 May 16, 2025 Policies and Procedures for Related Party Transactions Our board of directors has adopted a written related party transactions policy, which sets forth the policies and procedures for the review and approval or ratification of related person transactions. Pursuant to this policy, the audit committee has the primary responsibility for reviewing and approving or disapproving “related party transactions,” which are transactions, arrangements or relationships between us and related persons in which the aggregate amount involved in any fiscal year exceeds or may be expected to exceed the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed fiscal years and in which a related person has or will have a direct or indirect material interest. For purposes of this policy, a related person is defined as an executive officer, director, nominee for director or greater than 5% beneficial owner of any class of our voting securities in each case since the beginning of the most recently completed fiscal year, and their immediate family members. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES The following table sets forth the aggregate fees billed to us for the years ended December 31, 2025 and 2024 by our independent auditors, M&K CPAs, PLLC: 2025 2024 Audit Fees (1) $ 182,200 $ 185,000 Audit-Related Fees - - Tax Fees - - All Other Fees - - Total Fees $ 182,200 $ 185,000 (1) Audit fees represent amounts billed for professional services rendered for the audit and/or review of our consolidated financial statements. For 2024 and 2025, it includes fees related to professional services rendered in connection with the issuance of consents related to Registration Statements on Form S-3 and Form S-8. Pre-Approval Policy Pursuant to the Audit Committee Charter, the audit committee is required to pre-approve the audit and non-audit services performed by our independent auditors. Notwithstanding the foregoing, separate audit committee pre-approval is not required (a) if the engagement for services is entered into pursuant to pre-approval policies and procedures established by the audit committee regarding our engagement of the independent auditor (the “Pre-Approval Policy”) as to matters within the scope of the Pre-Approval Policy or (b) for de minimis non-audit services that are approved in accordance with applicable SEC rules. For fiscal year 2025, all services performed by our independent auditors were pre-approved by the audit committee. 71 PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a)(1) Financial Statements Report of Independent Registered Public Accounting Firm F-2 Audited Consolidated Balance Sheets as of December 31, 2025 and December 31, 2024 F-3 Audited Consolidated Statements of Operations for the Years ended December 31, 2025 and 2024 F-4 Audited Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024 F-5 Audited Consolidated Statements of Stockholders’ Equity ( Deficit) for the Years ended December 31, 2025 and 2024 F-6 Notes to Audited Financial Statements F-7 (a)(2) Financial Statement Schedules Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto. (a)(3) Exhibit Index Exhibit No. Description of Exhibit 2.1+ Stock Purchase Agreement, dated February 6, 2023, by and among the Company and Mihran Berejikian, Nancy Berejikian, and Michael Lack (incorporated herein by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 7, 2023). 2.2 First Amendment to Stock Purchase Agreement, dated April 28, 2023, by and among SKYX Platforms Corp. and Mihran Berejikian, Nancy Berejikian, and Michael Lack (incorporated herein by reference to Exhibit 2.2 to the Company’s Current Report on Form 8-K filed with the SEC on May 1, 2023). 3.1 Articles of Incorporation of the Company (incorporated herein by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 3.2 Articles of Amendment to Articles of Incorporation, (effective August 12, 2016) (incorporated herein by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 3.3 Articles of Amendment to Articles of Incorporation (effective February 7, 2022) (incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2022). 3.4 Articles of Amendment to Articles of Incorporation (effective June 14, 2022) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on June 14, 2022). 3.5 Articles of Amendment to Articles of Incorporation (effective May 2, 2023) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 5, 2023). 3.6 Certificate of Designation of Rights, Preferences and Privileges of Series A Preferred Stock (effective September 30, 2024) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 4, 2024). 3.7 Certificate of Designation of Rights, Preferences and Privileges of Series A-1 Preferred Stock (effective September 30, 2024) (incorporated herein by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed with the SEC on October 4, 2024). 3.8 Articles of Amendment to the Certificate of Designation of Rights, Preferences and Privileges of Series A-1 Preferred Stock (effective May 2, 2025) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 8, 2025). 3.9 Certificate of Designation of Rights, Preferences and Privileges of Series A-2 Preferred Stock (effective December 2, 2025) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 5, 2025). 3.10 Articles of Amendment to the Certificate of Designation of Rights, Preferences and Privileges of Series A-2 Preferred Stock (effective December 23, 2025) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report filed with the SEC on January 2, 2026). 3.11 Third Amended and Restated Bylaws of the Company (effective March 21, 2025) (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 21, 2025). 4.1 Description of the Company’s Registered Securities (filed herewith). 4.2 Specimen Common Stock Certificate (incorporated herein by reference to Exhibit 4.2 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 10.1+ Form of Securities Subscription Agreement and Warrant used in 2021 Private Placements (incorporated herein by reference to Exhibit 10.13 to Amendment No. 1 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on January 10, 2022). 10.2* 2015 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.14 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.3* Form of Stock Option Agreement (2015 Plan) (incorporated herein by reference to Exhibit 10.15 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.4* Form of Stock Award Agreement (2015 Plan) (incorporated herein by reference to Exhibit 10.16 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.5* 2018 Stock Incentive Plan, as amended and restated (incorporated herein by reference to Exhibit 10.17 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.6* Form of Stock Option Agreement (2018 Plan) (incorporated herein by reference to Exhibit 10.18 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.7* Form of Stock Award Agreement (2018 Plan) (incorporated herein by reference to Exhibit 10.19 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.8* Executive Employment Agreement, dated September 1, 2019, between the Company and John P. Campi (incorporated herein by reference to Exhibit 10.22 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.9* Executive Employment Agreement, dated September 1, 2019, between the Company and Patricia Barron (incorporated herein by reference to Exhibit 10.25 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 72 10.10+ Form of Stock Purchase Agreement between the Company and Bridge Line Ventures, LLC Series ST-1 (incorporated herein by reference to Exhibit 10.32 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.11 Form of Securities Purchase Agreement related to Purchase of Subordinated Convertible Balloon Promissory Note, including form of Subordinated Convertible Balloon Promissory Note (incorporated herein by reference to Exhibit 10.34 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.12 Form of Amendment No. 1 to Subordinated Convertible Balloon Promissory Note, dated March 29, 2024 (incorporated herein by reference to Exhibit 10.59 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 10.13+ Paycheck Protection Program Term Note, entered into by the Company, as Borrower, for the benefit of PNC Bank, National Association, as Lender, as of April 13, 2020 (incorporated herein by reference to Exhibit 10.35 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.14 Amendment to the Paycheck Protection Term Note, effective June 5, 2020 (incorporated herein by reference to Exhibit 10.36 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.15+ Second Draw Paycheck Protection Program Term Note, entered into by the Company, as Borrower, for the benefit of PNC Bank, National Association, as Lender, as of February 3, 2021 (incorporated herein by reference to Exhibit 10.37 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.16+ Loan Authorization and Agreement (Economic Injury Disaster Loan), dated June 24, 2020, between the U.S. Small Business Administration and the Company (incorporated herein by reference to Exhibit 10.38 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.17 Note (Secured Disaster Loans), entered into by the Company, as Borrower, for the benefit of the U.S. Small Business Administration, as of June 24, 2020 (incorporated herein by reference to Exhibit 10.39 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.18 Security Agreement, dated June 24, 2020, between the U.S. Small Business Administration and the Company (incorporated herein by reference to Exhibit 10.40 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.19* Amended and Restated 2021 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on July 10, 2024). 10.20* Form of Nonqualified Stock Option Agreement (2021 Stock Incentive Plan) (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2022). 10.21* Form of Incentive Stock Option Agreement (2021 Stock Incentive Plan) (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2022). 10.22* Form of Restricted Shares Award Agreement (2021 Stock Incentive Plan) (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2022). 10.23* Form of Nonqualified Stock Option Agreement (2021 Stock Incentive Plan) (August 2022) (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on August 5, 2022). 10.24* Form of Incentive Stock Option Agreement (2021 Stock Incentive Plan) (August 2022) (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on August 5, 2022). 10.25* Form of Restricted Shares Award Agreement (2021 Stock Incentive Plan) (August 2022) (incorporated herein by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on August 5, 2022). 10.26* Form of Restricted Share Unit Award Agreement (2021 Stock Incentive Plan) (August 2022) (incorporated herein by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the SEC on August 5, 2022). 10.27* Form of Nonqualified Stock Option Agreement (2021 Stock Incentive Plan) (April 2023) (incorporated herein by reference to Exhibit 10.12 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023). 10.28* Form of Restricted Share Unit Award Agreement (three-year vesting) (2021 Stock Incentive Plan) (April 2023) (incorporated herein by reference to Exhibit 10.13 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023). 73 10.29* Form of Restricted Share Unit Award Agreement (one year vesting) (2021 Stock Incentive Plan) (April 2023) (incorporated herein by reference to Exhibit 10.14 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023). 10.30* Form of Restricted Shares Award Agreement (2021 Stock Incentive Plan) (April 2023) (incorporated herein by reference to Exhibit 10.15 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023). 10.31* Form of Cash Retention Incentive Agreement (April 2023) (incorporated herein by reference to Exhibit 10.11 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023). 10.32* Executive Chairman Agreement, effective as of January 1, 2022, between the Company and Rani R. Kohen (incorporated herein by reference to Exhibit 10.45 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on December 22, 2021). 10.33* Chief Financial Officer Agreement, effective as of January 1, 2022, between the Company and Marc-Andre Boisseau (incorporated herein by reference to Exhibit 10.46 to Amendment No. 1 to the Company’s Registration Statement on Form S-1 (File No. 333-261829) filed with the SEC on January 10, 2022). 10.34 Representative’s Warrant, dated February 9, 2022 (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2022). 10.35+† Sublease Agreement, executed as of April 28, 2022, by and between the Company and Sicart Associates LLC (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 4, 2022). 10.36+ Lease Agreement, by and between 400 Biscayne Commercial Owner, L.P., as Landlord and the Company, as Tenant (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 29, 2022). 10.37+ Form of Securities Purchase Agreement, dated February 6, 2023 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 7, 2023). 10.38 Form of Subordinated Secured Convertible Promissory Note, dated February 6, 2023 (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 7, 2023). 10.39 Form of Common Stock Purchase Warrant, dated February 6, 2023 (incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 7, 2023). 10.40+ Form of Securities Purchase Agreement, dated March 29, 2023 (incorporated herein by reference to Exhibit 10.49 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2022). 10.41 Form of Subordinated Secured Convertible Promissory Note, dated March 29, 2023 (incorporated herein by reference to Exhibit 10.50 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2022). 10.42 Form of Common Stock Purchase Warrant, dated March 29, 2023 (incorporated herein by reference to Exhibit 10.51 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2022). 10.43 Letter Agreement, effective as of April 27, 2023, between SKYX Platforms Corp. and Nielsen & Bainbridge, LLC (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on April 28, 2023). 10.44 Form of Closing Promissory Note, dated April 26, 2023 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 1, 2023). 10.45 Sales Agreement by and between SKYX Platforms Corp. and The Benchmark Company, LLC, dated May 26, 2023 (incorporated herein by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 26, 2023). 10.46* Executive Employment Agreement, dated September 12, 2023, by and between SKYX Platforms Corp. and Leonard J. Sokolow (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 13, 2023). 10.47+ Line of Credit Promissory Note, Business Loan Agreement (Asset Based), and Commercial Security Agreement, signed September 18, 2023, by and between Belami, Inc., as borrower and grantor, and Farmers & Merchants Bank of Central California, as lender (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 22, 2023). 74 10.48+ Term Loan Promissory Note and Business Loan Agreement, signed September 18, 2023, by and between Belami, Inc., as borrower, and Farmers & Merchants Bank of Central California, as lender (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on September 22, 2023). 10.49 Commercial Guaranty, signed September 18, 2023, by and among Belami, Inc., as borrower, SKYX Platforms Corp., as guarantor, and Farmers & Merchants Bank of Central California, as lender (incorporated herein by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on September 22, 2023). 10.50† Licensing Master Services Agreement, signed December 4, 2023, between SKYX Platforms Corp. and GE Technology Development, Inc., and Letter Agreement relating to Trademark License Agreement, between SQL Lighting & Fans, LLC and GE Trademark Licensing, Inc (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 8, 2023. 10.51* Commission Termination Agreement, dated March 29, 2024, by and between SKYX Platforms Corp. and John Campi (incorporated herein by reference to Exhibit 10.57 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 10.52* Commission Termination Agreement, dated March 29, 2024, by and between SKYX Platforms Corp. and Patricia Barron (incorporated herein by reference to Exhibit 10.58 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 10.53 Letter Agreement to the Stock Purchase Agreement, as amended, dated March 29, 2024, by and among SKYX Platforms Corp., Mihran Berejikian, Nancy Berejikian and Michael Lack, and form of Convertible Promissory Note (incorporated herein by reference to Exhibit 10.60 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 10.54 Form of Amendment No.1 to SKYX Platforms Corp. Convertible Promissory Note (effective June 30, 2025) (incorporated herein by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025). 10.55 Amendment of Letter Agreement relating to Trademark License Agreement, dated April 11, 2024, among SKYX Platforms Corp., SQL Lighting & Fans, LLC and GE Trademark Licensing, Inc. (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on April 17, 2024). 10.56 Convertible Promissory Note, dated April 11, 2024, issued to GE Trademark Licensing, Inc. (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on April 17, 2024.) 10.57 Business Loan Agreement (Asset Based), signed September 23, 2024, by and between Belami, Inc., as borrower, and Farmers & Merchants Bank of Central California, as lender (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 24, 2024). 10.58 Commercial Guaranty, signed September 23, 2024, by and among Belami, Inc., as borrower, SKYX Platforms Corp., as guarantor, and Farmers & Merchants Bank of Central California, as lender (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on September 24, 2024). 10.59+ Form of Securities Purchase Agreement for Series A Preferred Stock, dated October 4, 2024 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 7, 2024). 10.60+ Form of Securities Purchase Agreement for Series A-1 Preferred Stock, dated October 4, 2024 (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on October 7, 2024). 10.61* Employment Agreement, dated as of December 20, 2024, by and between SKYX Platforms Corp. and Steven Schmidt (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 23, 2024). 10.62+ Form of Securities Purchase Agreement for Series A-1 Preferred Stock, dated March 11, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 12, 2025). 10.63+ Form of Securities Purchase Agreement for Series A-1 Preferred Stock, dated April 7, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on April 8, 2025). 10.64 Subordinated Secured Promissory Note, dated September 2, 2025 (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 5, 2025). 10.65+ Securities Purchase Agreement, dated September 2, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 5, 2025). 10.66 Form of Subordinated Secured Promissory Note (incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 17, 2025). 10.67 Form of Amendment No. 1 to Subordinated Secured Promissory Note (incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed with the SEC on October 17, 2025). 10.68+ Securities Purchase Agreement, dated October 17, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 17, 2025). 10.69+ Form of Securities Purchase Agreement for Series A-2 Preferred Stock, dated December 5, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 5, 2025). 10.70 Amendment No. 1 to Subordinated Convertible Balloon Promissory Note, dated December 30, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 2, 2026). 10.71+ Form of Securities Purchase Agreement for Series A-2 Preferred Stock, dated December 30, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 2, 2026). 10.72+ Form of Securities Purchase Agreement for Common Stock, dated January 7, 2026 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 13, 2026). 10.73 Placement Agency Agreement, dated January 23, 2026, by and between SKYX Platforms Corp. and Roth Capital Partners, LLC (incorporated herein by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 26, 2026). 10.74 Form of Securities Purchase Agreement, dated January 23, 2026 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 26, 2026). 19.1 SKYX Platforms Corp. Insider Trading Policy (last revised March 2023) (incorporated herein by reference to Exhibit 19.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 21.1 List of Subsidiaries (filed herewith). 23.1 Consent of Independent Registered Public Accounting Firm (filed herewith). 24.1 Power of Attorney (included on signature page). 31.1 Certification by Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). 31.2 Certification by Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). 32.1 Certification by Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith). 32.2 Certification by Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith). 97 SKYX Platforms Corp. Compensation Recovery Policy (adopted August 2023) (incorporated herein by reference to Exhibit 97 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023). 101 The following financial statements from the Annual Report on Form 10-K for the year ended December 31, 2025 are formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Stockholders’ Equity (Deficit), (iv) Consolidated Statements of Cash Flows, and (v) the Notes to Consolidated Financial Statements (filed herewith). 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) (filed herewith). * Indicates management contract or any compensatory plan, contract or arrangement. + Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request. † Portions of this exhibit (indicated by bracketed asterisks) are omitted in accordance with the rules of the SEC because they are both not material and the Company customarily and actually treats such information as private or confidential. ITEM 16. FORM 10-K SUMMARY None. 75 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SKYX PLATFORMS CORP. By: /s/ Leonard J. Sokolow Leonard J. Sokolow, Chief Executive Officer and Director Date: March 26, 2026 POWER OF ATTORNEY Each individual whose signature appears below constitutes and appoints Leonard J. Sokolow, Chief Executive Officer, and Marc-Andre Boisseau, Chief Financial Officer, and each of them singly, his or her true and lawful attorneys-in-fact and agents with full power of substitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all the said attorneys-in-fact and agents or any of them or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Leonard J. Sokolow Chief Executive Officer and Director March 26, 2026 Leonard J. Sokolow (Principal Executive Officer) /s/ Marc-Andre Boisseau Chief Financial Officer March 26, 2026 Marc-Andre Boisseau (Principal Financial and Accounting Officer) /s/ Rani R. Kohen Director, Executive Chairman of the Board March 26, 2026 Rani R. Kohen /s/ Nancy DiMattia Director March 26, 2026 Nancy DiMattia /s/ Gary N. Golden Director March 26, 2026 Gary N. Golden /s/ Efrat L. Greenstein Brayer Director March 26, 2026 Efrat L. Greenstein Brayer /s/ Dov Shiff Director March 26, 2026 Dov Shiff 76 FINANCIAL STATEMENTS SKYX PLATFORMS CORP. CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024 Index to Consolidated Financial Statements Pages Report of Independent Registered Public Accounting Firm (PCAOB ID: 2738 ) F-2 Consolidated Balance Sheets - December 31, 2025 and 2024 F-3 Consolidated Statements of Operations - December 31, 2025 and 2024 F-4 Consolidated Statements of Cash Flows - December 31, 2025 and 2024 F-5 Consolidated Statements of Stockholders’ Equity (Deficit) Cash Flows - December 31, 2025 and 2024 F-6 Notes to Consolidated Financial Statements F-7 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of SKYX Platforms Corp. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of SKYX Platforms Corp (the Company) as of December 31, 2025 and 2024 and the related consolidated statements of operation, stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2025, and the related consolidated notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its consolidated operations and its cash flows for each of the years in the two-year period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and the significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinion on the critical audit matters or on the accounts or disclosures to which they relate. Going Concern Due to the net loss, accumulated deficit and negative cash flows from operations for the year, the Company evaluated the need for a going concern. Auditing management’s evaluation of a going concern can be a significant judgment given the fact that the Company uses management estimates on future revenues and expenses, which are not able to be easily substantiated. To evaluate the appropriateness of the going concern, we examined and evaluated the financial information that was the initial cause for this consideration along with management’s plans to mitigate the going concern. Based on the audit procedures performed, we found that management’s conclusion that its plans alleviate the substantial doubt to be reasonable. /s/ M&K CPAS, PLLC We have served as the Company’s auditor since 2019 The Woodlands, TX March 26, 2025 F- 2 Part I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS SKYX PLATFORMS CORP. CONSOLIDATED BALANCE SHEETS December 31, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 8,052,621 $ 12,639,441 Accounts receivable 1,891,488 2,415,314 Inventory 4,250,168 3,785,346 Deferred cost of revenues - 223,214 Prepaid expenses and other assets 1,206,639 1,311,135 Total current assets 15,400,916 20,374,450 Long-term assets: Property and equipment, net 1,347,640 545,333 Restricted cash 2,050,000 2,861,054 Right of use assets 17,502,685 19,750,030 Intangibles, definite life 5,051,949 5,994,373 Goodwill 16,157,000 16,157,000 Other assets 205,044 204,807 Total long term assets 42,314,318 45,512,597 Total assets $ 57,715,234 $ 65,887,047 Liabilities and Stockholders’ Equity (Deficit) Current liabilities Accounts payable and accrued expenses $ 16,014,585 $ 13,235,221 Notes payable 356,474 4,011,168 Operating lease liabilities 2,589,994 2,350,868 Royalty obligations 1,300,000 800,000 Deferred revenues 2,082,622 1,495,846 Convertible notes related parties 350,000 950,000 Convertible notes 1,884,347 3,292,408 Total current liabilities 24,578,022 26,135,511 Long term liabilities Long term accounts payable 552,354 1,044,708 Notes payable 145,022 504,129 Operating lease liabilities 17,791,453 20,376,498 Royalty obligations - 900,000 Convertible notes 14,236,769 7,872,773 Total long-term liabilities 32,725,598 30,698,108 Total liabilities 57,303,620 56,833,619 Mezzanine equity Series A Preferred Stock-shares authorized 400,000 , outstanding 200,000 and 200,000 5,000,000 5,000,000 Stockholders’ Equity (deficit) Series A-1 Preferred Stock-shares authorized 480,000 , outstanding 292,000 and 240,000 7,124,167 6,000,000 Series A-2 Preferred Stock-shares authorized 160,000 , outstanding 60,000 and - 1,500,000 - Preferred stock 1,500,000 - Common stock and additional paid-in-capital: shares authorized 500,000,000 outstanding 117,666,800 and 103,358,975 203,046,051 179,837,253 Accumulated deficit ( 216,258,604 ) ( 181,783,825 ) Total stockholders’ equity (deficit) ( 4,588,386 ) 4,053,428 Total Liabilities and Stockholders’ Equity (deficit) $ 57,715,234 $ 65,887,047 The accompanying notes are an integral part of the consolidated financial statements. F- 3 SKYX PLATFORMS CORP. CONSOLIDATED STATEMENTS OF OPERATIONS (AUDITED) 2025 2024 For the year ended December 31, 2025 2024 Revenue $ 92,009,949 $ 86,276,876 Operating expenses Cost of revenues 64,173,870 61,682,934 Selling and marketing expenses 25,701,665 25,353,172 General and administrative expenses 31,246,804 31,353,009 Total expenses, net 121,122,339 118,389,115 Loss from operations ( 29,112,390 ) ( 32,112,239 ) Other expenses Interest expense - related party 119,486 151,900 Interest expense, net 4,183,728 3,904,005 Gain on extinguishment of debt - ( 400,000 ) Total other expenses, net 4,303,214 3,655,905 Net loss ( 33,415,604 ) ( 35,768,144 ) Preferred dividends - related party 80,000 20,000 Preferred dividends 979,175 192,667 Net loss attributed to common stockholders $ ( 34,474,779 ) $ ( 35,980,811 ) Net loss per share - basic and diluted $ ( 0.32 ) $ ( 0.36 ) Weighted average number of common shares outstanding – basic and diluted 108,757,074 99,766,866 The accompanying notes are an integral part of the consolidated financial statements. F- 4 SKYX PLATFORMS CORP. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (AUDITED) 2025 2024 For the year ended December 31, 2025 2024 Shares of preferred stock ( Series A-1) Balance, beginning of year 240,000 - Preferred stock Conversion to common ( 102,000 ) - Preferred stock issued pursuant to offerings 154,000 240,000 Balance, end of year 292,000 240,000 Preferred stock ( Series A-1) Balance, beginning of year $ 6,000,000 $ - Preferred stock Conversion to common ( 2,550,000 ) - Preferred stock issued pursuant to offerings 3,674,167 6,000,000 Balance, end of year $ 7,124,167 $ 6,000,000 Shares of preferred stock ( Series A-2) Balance, beginning of year - - Preferred stock Conversion to common - - Preferred stock issued pursuant to offerings 60,000 - Balance, end of year 60,000 - Preferred stock ( Series A-2) Balance, beginning of year $ - $ - Preferred stock Conversion to common - - Preferred stock issued pursuant to offerings 1,500,000 - Balance, end of year $ 1,500,000 $ - Shares of common stock Balance, beginning of year 103,358,975 93,473,433 Common stock issued pursuant to offerings 4,243,123 3,535,067 Common stock issued pursuant to acquisition - 1,853,421 Common stock issued pursuant to conversion of preferred stock 1,958,336 - Common stock issued pursuant to preferred dividends 30,842 - Common stock issued pursuant to conversion of notes 272,728 - Common stock issued pursuant to conversion of accrued interest 433,073 - Common stock issued pursuant to exercise of options 1,001,492 128,023 Common stock issued pursuant to services 6,368,231 4,369,031 Balance, end of year 117,666,800 103,358,975 Common stock and paid-in capital Balance, beginning of year $ 179,837,253 $ 162,025,024 Common stock issued pursuant to offerings 5,424,368 4,330,295 Common stock issued pursuant to conversion of preferred stock 2,550,000 - Common stock issued pursuant to preferred dividends 38,559 - Common stock issued pursuant to conversion of notes 600,000 - Common stock issued pursuant to conversion of accrued interest 615,291 - Common stock issued pursuant to exercise of options 420,000 7,501 Common stock issued pursuant to services 13,560,580 13,474,433 Balance, end of year $ 203,046,051 $ 179,837,253 Accumulated Deficit Balance, beginning of year $ ( 181,783,825 ) $ ( 145,803,014 ) Preferred dividends ( 1,059,175 ) ( 212,667 ) Net loss ( 33,415,604 ) ( 35,768,144 ) Balance, end of year $ ( 216,258,604 ) $ ( 181,783,825 ) Total Stockholders’ Equity (deficit) $ ( 4,588,386 ) $ 4,053,428 The accompanying notes are an integral part of the consolidated financial statements. F- 5 SKYX PLATFORMS CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS (AUDITED) 2025 2024 For the year ended December 31, 2025 2024 Operations: Net loss $ ( 33,415,604 ) $ ( 35,768,144 ) Adjustments to reconcile net loss to net cash used in operating activities Depreciation and amortization 4,320,338 4,066,957 Amortization of debt discount 1,113,996 1,211,974 Impairment of intangible assets - 1,118,750 Non-cash equity-based compensation expense 13,560,580 13,474,433 Gain on forgiveness of debt - ( 400,000 ) Equity-based payment of interest 615,291 - Change in operating assets and liabilities Inventory ( 464,823 ) ( 359,612 ) Accounts receivable 523,826 969,662 Prepaid expenses and other assets 104,256 ( 628,461 ) Deferred charges 223,214 1,231 Deferred revenues 586,776 20,327 Operating lease liabilities ( 2,345,919 ) ( 2,101,316 ) Royalty obligation ( 400,000 ) ( 800,000 ) Accounts payable and accrued expenses 2,287,010 933,829 Net cash used in operating activities ( 13,291,059 ) ( 18,260,370 ) Investing: Purchase of property and equipment ( 1,932,873 ) ( 981,428 ) Acquisition, net of cash acquired - ( 750,000 ) Net cash used in investing activities ( 1,932,873 ) ( 1,731,428 ) Financing: Proceeds from issuance of common stock - offerings 5,584,390 4,426,222 Placement cost ( 335,855 ) ( 88,426 ) Dividends paid ( 1,020,616 ) - Proceeds from line of credit - 500,000 Proceeds from issuance of preferred stock-related parties - 1,000,000 Proceeds from issuance of preferred stocks 5,350,000 10,000,000 Proceeds from issuance of preferred stocks 5,350,000 10,000,000 Proceeds from exercise of options 420,000 - Proceeds from issuance of convertible notes 5,250,000 - Principal repayments of notes payable ( 5,421,861 ) ( 2,775,756 ) Net cash provided by financing activities 9,826,058 13,062,040 Change in cash and cash equivalents, and restricted cash ( 5,397,874 ) ( 6,929,758 ) Cash, cash equivalents and restricted cash at beginning of the year 15,500,495 22,430,253 Cash, cash equivalents and restricted cash at end of year $ 10,102,621 $ 15,500,495 Cash paid during the year for: Interest $ 3,872,214 $ 3,281,597 Taxes - - Supplementary disclosure of non-cash financing activities: Preferred stock conversion to common $ 2,550,000 $ - Substitution of royalty payable to convertible note - 1,000,000 Substitution of consideration payable to convertible note 600,000 3,117,408 Right-of-use assets and operating lease liabilities - 662,698 Accrued dividends payable $ 36,444 $ 212,667 The accompanying notes are an integral part of the consolidated financial statements. F- 6 SKYX Platforms Corp. Notes to Consolidated Financial Statements NOTE 1 ORGANIZATION AND NATURE OF OPERATIONS SKYX Platforms Corp., a corporation (the “Company”), was incorporated in Florida in May 2004. The Company maintains offices in Sacramento, California, Johns Creek, Georgia, Miami and Pompano Beach, Florida, New York City, and Guangdong Province, China. The Company has a series of advanced-safe-smart platform technologies. The Company’s first-generation technologies enable light fixtures, ceiling fans and other electrically wired products to be installed safely and plugged-in to a ceiling’s electrical outlet box within seconds, and without the need to touch hazardous wires. The plug and play technology method is a universal power-plug device that has a matching receptacle that is simply connected to the electrical outlet box on the ceiling, enabling a safe and quick plug and play installation of light fixtures and ceiling fans in just seconds. The plug and play power-plug technology eliminates the need of touching hazardous electrical wires while installing light fixtures, ceiling fans and other hardwired electrical products. In recent years, the Company has expanded the capabilities of its power-plug product, to include its second generation advanced-safe and quick universal installation methods, as well as advanced-smart capabilities. The smart features include control of light fixtures and ceiling fans by the SkyHome App, through WIFI, Bluetooth Low Energy and voice control. It allows scheduling, energy savings eco mode, dimming, back-up emergency light, night light, light color changing and much more. The Company’s third-generation technology is an all-in-one safe and smart-advanced platform that is designed to enhance all-around safety and lifestyle of homes and other buildings. Since April 2023, the Company also markets home lighting, ceiling fans and other home furnishings from third parties. Going Concern The Company’s liquidity sources include $ 10.10 million in cash and cash equivalents, including restricted cash of $ 2.05 million held for long-term purposes. The Company also generated net proceeds of $ 29.3 million from the issuance of shares of its common stock during January 2026. While the Company has a history of operating losses, it has enough liquidity sources as of December 31, 2025, together with net proceeds generated in January 2026, to alleviate substantial doubt about its ability to continue as a going concern. NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following is a summary of the Company’s significant accounting policies: Basis of Presentation The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) under the accrual basis of accounting. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. F- 7 Such estimates and assumptions impact both assets and liabilities, including but not limited to: net realizable value of accounts receivable and inventory, estimated useful lives and potential impairment of property and equipment, the valuation of intangible assets, estimate of fair value of share based payments and derivative liabilities, estimates of fair value of warrants issued and recorded as debt discount, estimates of tax liabilities and estimates of the probability and potential magnitude of contingent liabilities. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future nonconforming events. Accordingly, actual results could differ significantly from estimates. Reclassifications For comparability, reclassifications of certain prior-year balances were made in order to conform with current-year presentations, such as costs of internal-use software reclassified as intangible assets which were previously included in property and equipment. Basis of Consolidation The consolidated financial statements include the results of the Company and all its subsidiaries, including SQL Lighting and Fans LLC, Belami, Inc., BEC, CA 1, Inc. (through December 31, 2024), BEC CA 2, LLC, Luna BEC (through December 31, 2024), Inc., and Confero Group LLC. All intercompany balances and transactions have been eliminated in consolidation. Cash, Cash Equivalents, and restricted cash. The Company considers all highly liquid securities with original maturities of three months or less when acquired, to be cash equivalents. The Company’s cash composition was as follows: SCHEDULE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH December 31, 2025 December 31, 2024 Cash and cash equivalents $ 8,052,621 $ 12,639,441 Restricted cash 2,050,000 2,861,054 Total cash, cash equivalents and restricted cash $ 10,102,621 $ 15,500,495 Restricted Cash The Company issued a letter of credit of $ 2.8 million in September 2022 to use as collateral for certain obligations to one of its lessors which was further reduced to $ 2.0 million during 2025. The letter of credit was issued by a financial institution and was secured by cash of $ 2.05 million and $ 2.8 million as of December 31, 2025, and December 2024, respectively. Customer Contracts Balances Accounts receivables are recorded in the period when the right to receive payment or other consideration becomes unconditional. Accounts receivables are recorded at the invoiced amount and are not interest bearing. The Company maintains an allowance for doubtful accounts based upon an estimate of probable credit losses in existing accounts receivable. The majority of the Company’s accounts receivable are from third-party payers and are paid within a few days from the order date. The Company determines the allowance based upon individual accounts when information indicates the customers may have an inability to meet their financial obligations, historical experience, and currently available evidence. The Company’s allowance for doubtful accounts was $ 22,668 and $ 12,147 as of December 31, 2025, and 2024, respectively. The Company determines an allowance for sales returns based upon historical experience. F- 8 The Company’s allowance for sales returns was $ 284,469 and $ 242,515 as of December 31, 2025, and 2024, respectively, and is recorded as an accrued expenses in the accompanying consolidated financial statements. The Company defers the revenue related to undelivered customer orders for which it was paid or has a right to be paid at each measurement date. Such amounts are recognized as deferred revenues in the accompanying balance sheet. The deferred revenues amounted to $ 2,082,622 , and $ 1,495,846 as of December 31, 2025, and 2024, respectively. The costs associated with such deferred revenues are recognized as deferred charges in the accompanying balance sheet. Such charges include the carrying value of freight, and sales charges. Deferred charges are included in prepaid costs and other assets in the accompanying balance sheet. Inventory Inventories are stated at the lower of cost, determined on the first-in, first-out method. Cost principally consists of the purchase price (adjusted for lower of cost or market), customs, duties, and freight. The Company periodically reviews historical sales activity to determine potentially obsolete items and evaluates the impact of any anticipated changes in future demand. SCHEDULE OF INVENTORY December 31, 2025 December 31, 2024 Inventory, component parts $ 2,413,821 $ 1,901,922 Inventory, finished goods 3,136,347 3,183,424 Allowance ( 1,300,000 ) ( 1,300,000 ) Inventory-total $ 4,250,168 $ 3,785,346 The Company maintains an allowance based on specific inventory items that have shown no activity over a reasonable period. The Company tracks inventory as it is repurposed, disposed, scrapped, or sold at below cost to determine whether additional items on hand should be reduced in value through an allowance method. Furniture and Equipment Furniture and equipment are stated at cost, less accumulated depreciation, and is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Depreciation of property and equipment is provided utilizing the straight-line method over the estimated useful lives, ranging from 3 to 7 years of the respective assets. Expenditures for maintenance and repairs are charged to expense as incurred. Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the statements of operations. Intangible Asset Intangible assets were recorded in connection with the acquisition of Belami. Intangible assets with finite lives, which consist of customer relationships and e-commerce technology platforms, are being amortized over their estimated useful lives on a straight-line basis. Such intangible assets are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company assesses the recoverability of its intangible assets by determining whether the unamortized balance can be recovered over the assets’ remaining estimated useful life through undiscounted estimated future cash flows. If undiscounted estimated future cash flows indicate that the unamortized amounts will not be recovered, an adjustment will be made to reduce such amounts to fair value based on estimated future cash flows discounted at a rate commensurate with the risk associated with achieving such cash flows. Estimated future cash flows are based on trends of historical performance and the Company’s estimate of future performance, considering existing and anticipated competitive and economic conditions. F- 9 The Company developed various patents for an installation device used in light fixtures and ceiling fans. Costs incurred for submitting the applications to the United States Patent and Trademark Office for these patents have been capitalized. Patent costs are amortized using the straight-line method over the related 15 -year lives. The Company begins amortizing patent costs once a filing receipt is received stating the patent serial number and filing date from the Patent Office. The Company incurs certain legal and related costs in connection with patent applications. The Company capitalizes such costs to be amortized over the expected life of the patent to the extent that an economic benefit is anticipated from the resulting patent or alternative future use is available to the Company. The Company also capitalizes legal costs incurred in the defense of the Company’s patents when it is believed that the future economic benefit of the patent will be maintained or increased, and a successful defense is probable. Capitalized patent defense costs are amortized over the remaining expected life of the related patent. The Company’s assessment of future economic benefit or a successful defense of its patents involves considerable management judgment, and an unfavorable outcome of litigation could result in a material impairment charge up to the carrying value of these assets. Management determined that there was no impairment of the Company’s intangible assets as of December 31, 2025. Goodwill Goodwill, which was recorded in connection with the acquisition of Belami, is not subject to amortization and is tested for impairment annually, or more frequently if events or changes in circumstances indicate that the asset may be impaired. Goodwill represents the excess of the purchase price of Belami over the fair value of its identifiable net assets acquired. Goodwill is tested for impairment at the reporting unit level. Fair value is typically based upon estimated future cash flows discounted at a rate commensurate with the risk involved or market-based comparables. If the carrying amount of the reporting unit’s net assets exceeds its fair value, then an analysis will be performed to compare the implied fair value of goodwill with the carrying amount of goodwill. An impairment loss will be recognized in an amount equal to the excess of the carrying amount over its implied fair value. After an impairment loss is recognized, the adjusted carrying amount of goodwill is its new accounting basis. Accounting guidance on the testing of goodwill for impairment allows entities testing goodwill for impairment the option of performing a qualitative assessment to determine the likelihood of goodwill impairment and whether it is necessary to perform such two-step impairment test. Management determined that there was no impairment of the Company’s goodwill as of December 31, 2025. Fair Value of Financial Instruments The Company measures assets and liabilities at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs used in valuation techniques, are assigned to a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: ● Level 1 – Observable inputs that reflect quoted market prices in active markets for identical assets or liabilities. ● Level 2 – Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. ● Level 3 – Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. F- 10 The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, accounts receivable, inventory, prepaid expenses, other current assets, accounts payable, accrued interest payable, certain notes payable and notes payable – related party, and GE royalty obligation, approximate their fair values because of the short maturity of these instruments. Embedded Conversion Features The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion features. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then revalued at each reporting date, with changes in the fair value reported as charges or credits to income. As of December 31, 2025, the Company had a sufficient number of authorized shares of common stock to accommodate the conversion features on Series A, A-1 and A-2 Preferred Stock, warrants, options, and convertible notes. These shares have been reserved for issuance by the Company, and accordingly, no derivative liability has been recognized. Distinguishing Liabilities from Equity The Company evaluates at each measurement date the proper classification of its liabilities and equity accounts. The Company has evaluated how it should classify its Series A, A-1 and A-2 Preferred Stock issued in the year 2025. The Company has determined that the Series A, A-1 and A-2 Preferred Stock should not be classified as liabilities as of December 31, 2025. The designation of Series A includes provisions that under certain contingent circumstances outside of liquidation, the holders of the Series A Preferred Stock control whether they could receive cash consideration. Management determined that based on these provisions, the Series A Preferred Stock should be classified as temporary equity. Management determined the Company controls the contingent circumstances under which the holders of Series A-1 and A-2 would be granted cash consideration outside of liquidation, and , accordingly, classified Series A-1 and A-2 Preferred Stock as permanent equity. Extinguishments of Liabilities The Company accounts for extinguishments of liabilities in accordance with ASC 405-20 (formerly SFAS 140) “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities”. When the conditions are met for extinguishment accounting, the liabilities are derecognized and the gain or loss on the sale is recognized. Stock-based Compensation The Company periodically issues common stock, RSUs and stock options to officers, directors, employees and consultants for services rendered. F- 11 The Company accounts for stock incentive awards issued to employees and non-employees in accordance with FASB ASC 718, Stock Compensation. Accordingly, stock-based compensation is measured at the grant date, based on the fair value of the award. Stock-based awards to employees are recognized as an expense over the requisite service period, or upon the occurrence of certain vesting events. Additionally, stock-based awards to non-employees are expensed over the period in which the related services are rendered. The expense resulting from share-based payments is recorded in operating expenses in the statements of operations. Revenue Recognition The Company currently generates revenues substantially from home lighting, ceiling fans, and smart products through its family of internet sites and marketplaces. A substantial portion of the Company’s customers’ orders are made and paid contemporaneously by credit card and shipped through third-party delivery providers. The Company recognizes revenues once it concludes that the control of the product is transferred to the customer, which is upon delivery. The Company records reductions to revenue for estimated customer sales returns and replacements, net of sales tax. The Company receives rebate and cooperative allowances based on a percentage of periodic purchases from certain vendors. These vendor considerations are reflected as a reduction of cost of revenues. The vendor considerations, the rights of returns and replacements are based upon estimates that are determined by historical experience, contractual terms, and current market conditions. The primary factors affecting the Company’s accrual for estimated customer return rights include estimated customer return rates as well as the number of units shipped that have a right of return that have not expired as of the measurement date. Cost of Revenues Cost of revenues represents costs directly related to produce, acquiring and source inventory for sale, and provisions for inventory shrinkage and obsolescence. These costs include the costs of purchased products, inbound freight, and custom duties. Selling, General and Administrative Expenses Shipping and handling costs incurred by the Company to deliver finished goods are expensed and recorded in selling, general and administrative expenses. Additionally, selling, general and administrative expenses include marketing, professional fees, distribution, warehouse costs, and other related selling costs. Selling expenses include costs incurred in the selling of merchandise. General and administrative expenses include costs incurred in the administration or general operations of the business. Stock compensation expense consists of non-cash charges resulting from the issuance of stock units and stock options that are disclosed in the selling, general and administrative expenses and included as operating expenses. F- 12 Income Tax Provision The Company accounts for income taxes under Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to be reversed. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Consolidated Statements of Operations in the period that includes the enactment date. The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (Section 740-10-25). Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty (50) percent likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying consolidated balance sheets, as well as tax credit carrybacks and carryforwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its consolidated balance sheets and provides valuation allowances as management deems necessary. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In the management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. Uncertain Tax Positions The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the provisions of Section 740-10-25 for fiscal 2025. Contingencies The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. F- 13 Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, consolidated financial position, and consolidated results of operations or consolidated cash flows. Comprehensive Income or loss Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale securities, are reported as a separate component of the stockholders’ equity section of the statements of financial condition. Such items along with net income are components of comprehensive income. Loss Per Share Basic net earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of common stock outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted average number of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. The Company uses the “treasury stock” method to determine whether there is a dilutive effect of outstanding convertible debt, option and warrant contracts. The Company recognized net loss and a dilutive net loss during 2025 and 2024, and the effect of considering any common stock equivalents would have been antidilutive for the period. Therefore, a separate computation of diluted earnings (loss) per share is not presented for the periods presented. The Company had the following anti-dilutive common stock equivalents at December, 2025 and 2024: SCHEDULE OF ANTI-DILUTIVE COMMON STOCK EQUIVALENTS December 31, 2025 December 31, 2024 Stock warrants 1,588,417 1,523,667 Stock options 31,838,322 32,493,392 Unvested restricted stock 4,988,817 6,278,370 Convertible notes 14,863,205 6,063,890 Preferred stock 10,999,997 5,500,000 Anti-dilutive securities 64,278,758 51,859,319 Recently Issued Accounting Pronouncements Segment Reporting – Improvements to Reportable Segment Disclosures In November 2023, the Financial Accounting Standards Board (“FASB”) issued a new standard to improve reportable segment disclosures. The guidance expands the disclosures required for reportable segments in our annual and interim consolidated financial statements, primarily through enhanced disclosures about significant segment expenses. We adopted this standard in 2024. The impact of this standard is only on the Company’s segment disclosures. F- 14 Comprehensive Income- Improvements to Expense Disaggregation Disclosures In November 2024, the Financial Accounting Standards Board (“FASB”) issued a new standard to improve expense disaggregation disclosures. The guidance expands the disclosures required for certain costs and expenses in our annual and interim consolidated financial statements, primarily through enhanced disclosures about significant expenses. The standard is effective as of March 31, 2026 and interim and annual periods thereafter. The impact of this standard is only on the Company’s expenses disclosures. NOTE 3 PROPERTY AND EQUIPMENT Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT December 31, 2025 December 31, 2024 Equipment and furniture $ 924,266 $ 924,627 Leasehold improvements 1,400,859 360,003 Total 2,325,125 1,284,630 Less: accumulated depreciation ( 977,485 ) ( 739,297 ) Total, net $ 1,347,640 $ 545,333 Depreciation expenses amounted to $ 238,188 and $ 68,022 during 2025 and 2024, respectively. NOTE 4 INTANGIBLE ASSETS AND GOODWILL Intangible assets consisted of the following: SCHEDULE OF INTANGIBLE ASSETS December 31, 2025 December 31, 2024 Useful life Carrying Value Accumulated Amortization Net carrying value Carrying Value Accumulated Amortization Net carrying value Customer relationships 7 $ 4,500,000 $ ( 1,607,143 ) $ 2,892,857 $ 4,500,000 $ ( 1,071,428 ) $ 3,428,572 E-commerce technology platforms 1 - 4 3,097,040 ( 1,482,974 ) 1,614,066 2,204,660 ( 243,744 ) 1,960,916 Patents and other 15 931,831 ( 386,805 ) 545,026 931,831 ( 326,946 ) 604,885 $ 8,528,871 $ ( 3,476,922 ) $ 5,051,949 $ 7,636,491 $ ( 1,642,118 ) $ 5,994,373 Amortization expense on intangible assets was $ 1,834,804 and $ 1,832,568 during 2025 and 2024, respectively. During the quarter ended September 30, 2024, the Company evaluated the effectiveness of the E-commerce technology platforms it acquired in 2023. Management determined that revenues could increase without increasing its operating expenses (and potentially decrease its general and administrative expenses) using a different E-commerce technology platform. Management believes it will discontinue using its legacy platforms by October 1, 2025. Accordingly, the estimated useful life of its legacy platforms decreased from 4 to 1 year. The reduced estimated useful life of the intangible asset indicated a possible impairment of the carrying value of such intangible. Management prepared, with a third-party firm, an analysis of the future cash flows related to the legacy platform and determined that, as of September 30, 2024, such future cash flows were lower than the carrying value of the related intangible asset. Accordingly, management believes that its legacy platforms’ carrying value was impaired. Based on the future estimated discounted cash flows, Management believes that the carrying value of the legacy platforms should be $ 1.4 million. Accordingly, management recorded an impairment expense of $ 1.1 million and adjusted the carrying value of its legacy platform to $ 1.4 million as of and during the quarter ended September 30, 2024. F- 15 The following table sets forth the estimated amortization expenses for the next five years: SCHEDULE OF INTANGIBLE ASSETS AMORTIZATION EXPENSE FOR FUTURE Twelve months ended December 31: 2026 1,381,516 2027 1,372,060 2028 864,363 2029 701,983 2030 271,305 Total amortization expenses 271,305 NOTE 5 DEBTS The following table presents the details of the principal outstanding: SCHEDULE OF DEBT December 31, 2025 December 31, 2024 APR on December 31, 2025 Maturity Collateral Convertible Notes (b,c,) $ 18,834,348 $ 15,592,408 0.00 – 10.00 % September 2023- October 2030 Substantially all Company assets Notes payable to financial institutions and others (a) 501,495 4,515,297 3.75 - 8.5 % August 2025- November 2052 Substantially all Company assets Total $ 19,335,843 $ 20,107,705 Unamortized debt discount ( 2,363,231 ) ( 3,477,227 ) Debt, net of Unamortized debt Discount $ 16,972,612 $ 16,630,478 SCHEDULE OF INTEREST EXPENSE DEBT For the year ended December 31, 2025 2024 Interest expense $ 1,747,055 $ 4,055,905 As of December 31, 2025, the expected future principal payments for the Company’s debt are due as follows: SCHEDULE OF FUTURE PRINCIPAL PAYMENTS Twelve months ended December 31, 2026 $ 2,594,529 Twelve months ended December 31, 2027 1,703,847 Twelve months ended December 31, 2028 3,994 Twelve months ended December 31, 2029 4,146 Twelve months ended December 31, 2030 and thereafter 15,029,327 Total $ 19,335,843 a) Included in Convertible Notes are loans provided to the Company from two directors and an officer. The notes each have the following terms: three-year subordinated convertible promissory note of principal face amounts. Subject to other customary terms, a convertible promissory note with a principal amount of $ 600,000 payable to a director, together with accrued interest of $ 235,900 , was converted into 379,955 shares of the Company’s common stock. The other remaining convertible promissory notes matured in May 2025, bear interest at an annual rate of 10 % thereafter, which is payable annually in cash or common stock, at the holder’s discretion. At any time after issuance and prior to or on the maturity date, the notes are convertible at the option of the holder into shares of common stock at a conversion price of $ 3 per share. During 2023, the Company issued convertible promissory notes. As an inducement to enter the financing transactions, the Company issued 1,391,667 warrants to the noteholders at an adjusted exercise price of $ 2.7 per warrant. The Company recorded a debt discount aggregating $ 5.6 million which was recognized as debt discount and additional paid-in capital in the accompanying balance sheet. The Company recognized $ 1,113,996 and $ 835,496 as amortized debt discount during the year ended December 31, 2025, and 2024, respectively, and it is reflected as interest expense in the accompanying unaudited consolidated statement of operations. b) In March 2024, and as amended in June 2025, the Company and the Belami sellers entered into a letter agreement modifying certain obligations under the Belami stock purchase agreement. In connection with the letter agreement, the Company issued convertible promissory notes to each of the sellers (the “Seller Note(s)”) in substitution of an aggregate of $ 3,117,909 in cash due to the sellers in monthly principal and interest payments of $ 300,000 beginning in July 2025 until fully paid in January 2026 . The notes are convertible at $ 3 per share of common stock. Additionally, the convertible promissory notes include a $ 1 million note payable to GE issued in April 2024. The convertible note is due in April 2027, does not bear interest and is convertible at a price of $ 1.07 per share. c) During 2025, the Company consolidated convertible notes aggregating $ 9.1 million with convertible notes generating proceeds of $ 5.2 million. The terms are substantially the same with the exception of the convertible rate which is $ 1.20 per share of the Company’s common stock. F- 16 NOTE 6 OPERATING LEASE LIABILITIES In April 2022, the Company entered into a 58 -month lease related to certain office and showroom space pursuant to a sublease that expires in February 2027 . The Company recognized a right-of-use asset and a liability of $ 1,428,764 pursuant to this lease. In September 2022, the Company entered a 124 -month lease related to its future headquarters offices and showrooms space. The Company recognized a right-of-use asset and a liability of $ 22,192,503 pursuant to such lease. In connection with the execution of lease, the Company was required to provide the landlord with a letter of credit in the amount of $ 2.7 million, which is secured by the same amount of cash. In January 2024, the Company entered into a 35 -month lease related to its Sacramento office. The Company recognized a right-of-use asset and a liability of $ 662,696 pursuant to such lease. The following table outlines the total lease cost for the Company’s operating leases as well as weighted average information for these leases as of December 31, 2025, and 2024 respectively: SCHEDULE OF LEASE COST OPERATING LEASE For the year ended December 31, 2025 2024 Cash paid for operating lease liabilities $ 2,345,919 $ 2,101,316 Rights-of-use obtained in exchange for new operating lease liabilities - 662,696 Fixed rent payments 3,136,161 2,703,789 Lease - Depreciation expense $ 2,020,500 $ 2,127,319 Weighted-average discount rate 6.48 % 6.45 % Weighted-average remaining lease term (in months) 84 95 SCHEDULE OF MINIMUM LEASE OBLIGATION Minimum Lease obligation Twelve months ended December 31, 2026 $ 2,589,994 Twelve months ended December 31, 2027 2,288,363 Twelve months ended December 31, 2028 2,471,537 Twelve months ended December 31, 2029 2,736,000 Twelve months ended December 31, 2030, and thereafter 10,295,553 Total $ 20,381,447 NOTE 7 ROYALTY OBLIGATIONS The Company had a license agreement with General Electric (“GE”) which provided, among other things, for rights to market certain of the Company’s products displaying the GE brand in consideration of royalty payments to GE. The agreement expired in 2023. The Company owes $ 1.3 million to GE pursuant to the license agreement as of December 31, 2025. The payments associated with this debt are payable in quarterly tranches aggregating $ 1.3 million during the year 2026. F- 17 The Company owed an additional amount of $ 1.4 million pursuant to its agreements with GE. During April 2024, GE and the Company agreed to reduce such additional amount by $ 400,000 in exchange for the issuance of a convertible promissory note of $ 1 million. NOTE 8 ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following: SCHEDULE OF ACCRUED EXPENSES December 31, 2025 December 31, 2024 Accrued interest, convertible notes $ 552,354 $ 1,044,708 Accrued dividends 249,111 212,667 Trade payables 14,533,064 10,043,423 Accrued compensation 1,232,410 2,979,131 Total $ 16,566,939 $ 14,279,929 NOTE 9 INCOME TAXES The Company has not paid or incurred any income taxes liabilities during 2025 and 2024 due to its net operating losses. State taxes are apportioned through 47 states. The states in which the apportionment are greatest are California and Florida, which comprise 22% of the effective state and local effective tax rate. The effects of temporary differences that gave rise to significant portions of deferred tax assets at December 31, 2025, and December 31, 2024 were approximately as follows: SCHEDULE OF DEFERRED TAX ASSETS 2025 2024 For the year ended December 31, 2025 2024 Net operating loss carryforward 34,436,504 $ 28,458,816 Stock-based compensation 3,930,195 2,707,630 Rights of use assets ( 4,429,142 ) ( 5,023,531 ) Operating lease liabilities 5,157,627 5,634,917 Other 933,102 487,722 Less Valuation Allowance ( 40,028,287 ) ( 32,265,553 ) Total Deferred Tax Assets - Net $ - $ - The change in valuation allowance is as follows: SCHEDULE OF CHANGE IN VALUATION ALLOWANCE 2025 2024 For the year ended December 31, 2025 2024 Net operating loss $ 5,977,689 $ 7,141,156 ) Fair value of options 1,222,565 1,603,333 Other, mostly amortization of intangible assets 696,875 ) 915,218 Change in valuation allowance 7,897,129 9,659,709 $ - $ - The Company’s tax expense differs from the statutory tax expense for the years ended December 31, 2025, and December 31, 2024 and the reconciliation is as follows. SCHEDULE OF INCOME TAX RATE RECONCILIATION 2025 Amount 2025 Percent 2024 Amount 2024 Percent U.S. Federal Statutory tax rate $ 7,017,227 21 % $ 7,498,169 21 % States and local income taxes, net of federal income tax effect 1,438,709 4.3 1,535,339 4.3 % Changes in valuation allowance ( 7,897,129 ) ( 23.6 )% ( 9,659,709 ) ( 27.1 )% Other ( 558,807 ) ( 1.7 )% 626,201 1.8 % Effective tax rate $ - - % $ - - % NOTE 10 RELATED PARTY TRANSACTIONS Convertible Notes Due to Related Parties Convertible notes due to related parties represent amounts provided to the Company from a director and the Company’s Chief Executive Officer as well as the Company’s former Co-Chief Executive Officer. The outstanding principal on the convertible promissory notes, associated with related parties was $ 350,000 and $ 950,000 as of December 31, 2025, and December 31, 2024, respectively and accrued interest of $ 35,486 and $ 242,803 , respectively. Also, the interest expense associated with these notes during 2025 and 2024 was $ 119,486 and $ 151,900 , respectively. Preferred dividends The Company paid and declared dividends to related parties (a director and officer and two officers) amounting to $ 80,000 and $ 20,000 during 2025. F- 18 NOTE 11 STOCKHOLDERS’ EQUITY (A) Common Stock The Company issued the following common stock during 2025 and 2024: SCHEDULE OF COMMON STOCK Average Value Transaction Type Shares Issued Valuation $ Per Share 2025 Equity Transactions Common stock issued, pursuant to services provided 6,368,231 $ 13,560,580 $ 2.13 Common stock issued pursuant to stock at the market offering, net 4,243,123 5,424,368 1.28 Common stock issued pursuant to preferred dividends 30,842 38,559 1.25 Common stock issued pursuant to conversion of notes 272,728 600,000 2.20 Common stock issued pursuant to conversion of accrued interest 433,073 615,291 1.42 Common stock issued pursuant to exercise of options 1,001,492 420,000 0.42 Common stock issued pursuant to conversion of preferred stock 1,958,336 2,550,000 1.30 2024 Equity Transactions Common stock issued, pursuant to services provided 4,369,031 $ 13,474,433 0.82 - 1.78 Common stock issued pursuant to stock at the market offering, net 3,535,067 4,330,295 0.9 – 1.64 Common stock issued pursuant to exercise of options, net 128,023 7,501 - Common stock issued pursuant to acquisition 1,853,421 - - (B) Preferred Stock During October 2024, the Company completed its authorization of the issuance of 440,000 shares of newly authorized Series A Preferred Stock and Series A-1 Preferred Stock. The designations of each class of preferred stock are as follows: SCHEDULE OF PREFERRED STOCK ACTIVITY Transaction Type Quantity Carrying Value Value per Share, gross Preferred Stock Balance at January 1, 2024 - $ - $ - Preferred Stock Series A 200,000 5,000,000 25 Preferred Stock Series A-1 240,000 6,000,000 25 Preferred Stock Balance at December 31, 2024 440,000 $ 11,000,000 $ 25 During the year ended December 31, 2025, the Company authorized the issuance of 60,000 shares of a new series of preferred stock Series A-2. Details of activity in Preferred Stock Series A-1 and Series A-2 are as follows: Transaction Type Quantity Carrying Value Value per Share, gross Preferred Stock Series A-1 Balance at January 1, 2025 240,000 $ 6,000,000 $ 25 Issuance 154,000 3,674,167 25 Conversion to common stock ( 102,000 ) ( 2,550,000 ) 25 Preferred Stock Series A-1 Balance at December 31, 2025 292,000 $ 7,124,167 $ 25 Preferred Stock Series A-2 Balance at January 1, 2025 - $ - $ - Issuance 60,000 1,500,000 25 Conversion to common stock - - - Preferred Stock Series A-2 Balance at December 31, 2025 60,000 $ 1,500,000 $ 25 The designations of each class of preferred stock are as follows: Series A Preferred Stock (temporary equity): ● Cumulative dividend of 8 % annually, 12 % if paid after dividend date; ● Original issue price of $ 25 per share; ● Conversion option at the holder’s option at $ 1.20 per share; ● Redemption at the price of $ 25 per share at the Company’s option after 5 years or upon change of control (substantially within the control of the holder); ● Voting rights on as converted basis. F- 19 Series A-1 and A-2 Preferred Stock (permanent equity): ● Cumulative dividend of 8 % annually, 12 % if paid after dividend date; ● Original issue price of $ 25 per share; ● Conversion option at the holder’s option at $ 1.20 per share for Series A and A-1 and $2 per share for Series A-2; ● Redemption at the price of $ 25 per share at the Company’s option after 3 years or upon change of control (substantially outside the control of the holder); ● Voting rights on as converted basis. (C) Stock Options The following is a summary of the Company’s stock option activity during 2025 and 2024: SCHEDULE OF STOCK OPTION ACTIVITY Weighted Average Remaining Weighted Contractual Aggregate Average Life Intrinsic Options Shares Exercise Price (In Years) Value Outstanding, January 1, 2025 32,493,392 $ 7.31 2.45 $ 1,727,080 Exercised 1,113,000 $ 0.70 Granted 5,633,030 1.65 - - Forfeited ( 7,401,100 ) ( 5.24 ) - - Outstanding, December 31, 2025 31,838,322 $ 6.81 2.12 $ 7,382,321 Exercisable, December 31, 2025 10,991,168 $ 4.56 2.51 $ 3,689,773 Outstanding, January 1, 2024 35,807,476 $ 7.33 - - Exercised 135,000 $ 0.10 - $ - Granted 3,673,500 1.17 - - Forfeited ( 6,851,084 ) 4.25 - 6,112,000 Outstanding, December 31, 2024 32,493,392 $ 7.31 2.45 $ 1,727,080 Exercisable, December 31, 2024 10,977,431 $ 4.40 2.25 $ 1,409,651 The following table summarizes the range of the Black Scholes pricing model assumptions used by the Company during 2025 and 2024. SCHEDULE OF BLACK SCHOLES PRICING MODEL December 31, 2025 December 31, 2024 Range Stock price 1.11 - 2.42 4.4 Exercise price 0 - 14 0 - 14 Expected life (in years) 2.50 - 3.47 yrs. 2.50 - 4.00 yrs. Volatility 101 – 110 % 36.7 – 96.5 % Risk-fee interest rate 3.56 - 4.02 % 3.50 - 4.62 % Dividend yield - - Prior to the second quarter of 2025, the Company did not have historical stock prices that could be reliably determined for a period that is at least equal to the expected terms of its options. The expected options terms, which were calculated using the plain vanilla method, are 3.5 years, and its historical period was 3 years. The Company relied on the expected volatility of comparable peer-group publicly traded companies within its industry sector, to supplement the Company’s historical data for the period of the expected terms of the options that exceeded the period of the Company’s historical volatility data. As of May 1, 2025, the Company uses its historical stock prices to determine its expected volatility. F- 20 (D) Warrants Issued The following is a summary of the Company’s warrant activity during 2025 and 2024: SCHEDULE OF WARRANT ACTIVITY Number of Warrants Weighted Average Exercise Price Balance, January 1, 2025 1,523,667 $ 4.30 Issued 64,750 1.2 Exercised - - Forfeited - - Balance, December 31, 2025 1,588,417 $ 4.19 Balance, January 1, 2024 2,063,522 $ 5.76 Issued — — Exercised — — Forfeited ( 539,885 ) 9.8 Balance, December 31, 2024 1,523,667 $ 4.30 During year ended December 31, 2025 and 2024, the Company did not issue any warrants except for warrants issued to a placement agent in connection with its Series A -1 Preferred offerings in the second quarter of 2025. (E) Restricted stock units A summary of the Company’s non-vested restricted stock units during 2025 and 2024 are as follows. SCHEDULE OF NON-VESTED RESTRICTED STOCK Weighted Average Grant Shares Due Fair Value Non-vested restricted stock units, January 1, 2025 6,278,370 $ 2.65 Granted 6,537,012 1.39 Vested ( 6,655,463 ) 1.60 Forfeited ( 1,171,102 ) 5.36 Non-vested restricted stock units, December 31, 2025 4,988,817 $ 1.76 Non-vested restricted stock units, January 1, 2024 4,935,822 $ 7.99 Granted 6,168,980 1.12 Vested ( 4,513,527 ) 2.27 Forfeited ( 312,905 ) 2.58 Non-vested restricted stock units on December 31, 2024 6,278,370 $ 2.65 The weighted-average remaining contractual life of the restricted units as of December 31, 2025, is 1.32 years. RSUA give the right to receive one share of the Company’s common stock. RSUAs that are vest based on service and performance are measured based on the fair values of the underlying stock on the date of grant. The Company used a Lattice model to determine the fair value of the RSU with a market condition. Compensation with respect to RSUA awards is expensed on a straight-line basis over the vesting period. The Company recognized compensation expenses of $ 10,420,491 , and $ 10,078,955 , respectively, related to RSUs and RSAs during the year ended December 31, 2025 and 2024, respectively. The Company recognized compensation expenses of $ 3,139,881 and $ 3,395,479 , respectively, related to stock options during the year ended December 31, 2025 and 2024, respectively. The options and RSUAs are granted to the Company’s employees, board members, and certain consultants. There is no difference in characteristics of the awards other than the stock options have to be exercised and restricted awards and units do not. The vesting of the options, restricted stock units or awards is based on the requisite service period of the employees and the non-employee’s vesting period is generally based on a period of up to six years . The maximum contractual term of the options is up to 5 years. The number of shares available for grant of options, and restricted stock units or awards amounts to 19,717,706 at December 31, 2025. F- 21 Unamortized future stock-based compensation expense was $ 9.25 million as of December 31, 2025. NOTE 12 CONCENTRATIONS OF RISKS Major Customers and Accounts Receivable The Company had no customers whose revenue individually represented 10% or more of the Company’s total revenue. The Company had two and three third-party payor accounts receivable balance representing 59 % and 24 % of the Company’s total accounts receivable at December 31, 2025 and 2024, respectively. Liquidity The Company’s cash and cash equivalents are held primarily with two financial institutions. The Company has deposits which exceed the amount insured by the FDIC. To reduce the risk associated with the failure of such counterparties, the Company periodically evaluates the credit quality of the financial institutions in which it holds deposits. Product and Geographic Markets The Company generates its income primarily from lighting and heating products sold primarily in the United States. Segment and Expense Disaggregation The Company operates in one segment: advanced-safe-smart technologies and related products. The Company used the following factors to identify includes the basis of organization, the relative similarities in types of product offerings. The chief operating decision maker consists of a team comprised of the Company’s Executive Chairman and its Chief Executive Officer. The total assets of the segments amount to the Company’s consolidated assets. Long-lived assets, which consists of property and equipment and right of use assets are located in the United States. The Company has concluded that consolidated net income or loss is the measure of segment profitability. The following is a reconciliation of the Company’s revenues from external customers and consolidated revenues and the consolidated and segment loss, including significant disaggregated segment expenses. SCHEDULE OF CONSOLIDATED REVENUES AND SEGMENT LOSS 2025 2024 For the year ended December 31, 2025 2024 Revenues from external customers and consolidated revenues $ 92,009,949 $ 86,276,876 Cost of revenues ( 64,173,870 ) ( 61,682,934 ) Compensation costs, excluding share-based payments ( 10,180,474 ) ( 9,730,111 ) Share-based payments ( 13,560,580 ) ( 13,474,433 ) Marketing programs ( 20,800,181 ) ( 18,800,142 ) Professional fees, excluding share-based payments ( 6,795,654 ) ( 7,149,168 ) Depreciation, amortization, and impairment of intangibles ( 4,176,466 ) ( 5,185,706 ) Other operating expenses ( 1,866,114 ) ( 2,366,621 ) Total operating expenses, net $ ( 121,553,339 ) $ ( 118,389,115 ) Other expenses Amortization of debt discount ( 1,113,996 ) ( 1,211,974 ) Interest expense, net ( 2,758,218 ) ( 2,843,931 ) Gain on extinguishment of debt - 400,000 Net loss $ ( 33,415,604 ) $ ( 35,768,144 ) NOTE 13 SUBSEQUENT EVENTS Management has evaluated subsequent events through March 26 2026, which is the date the consolidated financial statements were available to be issued. There were no significant subsequent events that required adjustment to or disclosure in the consolidated financial statements with the exception of the following: The Company generated proceeds of $ 29.3 million in consideration for the issuance of shares of common stock pursuant to two offerings and exercise of warrants. F- 22