What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-15 compared with 2024-11-14 · 1136 added, 1881 removed, 215 unchanged (93% of the section changed)

1 unchanged sentence

HOLDINGS, INC.

to the Condensed Consolidated Financial Statements

Condensed Consolidated Balance Sheets as of September 30, 2024 (Unaudited) and December 31, 2023

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)

Condensed Consolidated Statement of Comprehensive Income for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)

Condensed Consolidated Statements of Stockholder’s Deficit for the Three and Nine Months Ended September 30, 2024 and 2023 (unaudited)

Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2024 and 2023 (unaudited)

Notes to the Condensed Consolidated Financial Statements (unaudited)

HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

OF SEPTEMBER 30, 2024 AND DECEMBER 31, 2023

Current Assets:

1 unchanged sentence

Restricted cash

Marketable investment securities

Accounts receivable, net

Inventory, net

Prepaid expenses

Prepaid expenses and other current assets

Other current assets

Total Current Assets

6 unchanged sentences

Accounts payable

Customer deposits

Deferred revenue

1 unchanged sentence

Notes payable to related parties, current portion

Notes payable, current portion

Line of credit, bank

Margin line of credit account

Convertible notes payable

Notes payable assumed in Merger

Dividend notes payable

Accrued interest

6 unchanged sentences

Note payables to related parties, net of current portion

Note payables, net of current portion

PIPE loan payable, net

Dividend notes payable

Gross sales royalty payable

Lease liability, net of current portion

Other liabilities

Total Liabilities

1 unchanged sentence

Stockholders’ Deficit:

Preferred stock, $ 0.0001 par value, 10 million share authorized;

Preferred stock, $ 0.0001 par value, 10 million shares authorized;

zero shares issued and outstanding, respectively

Common stock, $ 0.0001 par value, 100,000,000 shares authorized:

Common stock - Series A, $ 0.0001 par value, 90 million shares authorized;

2 unchanged sentences

1,716,860 and 1,716,860 shares issued and outstanding, respectively

Common stock value

Treasury stock at cost, 4,692 shares of common stock held, respectively

2 unchanged sentences

Additional paid-in capital

Accumulated other comprehensive loss

Accumulated deficit / losses

Accumulated deficit

( 23,825,818 )

4 unchanged sentences

Total Liabilities and Stockholders’ Deficit

accompanying notes are an integral part of these unaudited condensed financial statements.

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

THE THREE AND NINE MONTHS ENDED SEPTEMBER 30,

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

Revenues, net

Cost of revenues

Three Months Ended

March 31, 2025

March 31, 2024

Cost of revenue

Total gross profit

Operating expenses:

2 unchanged sentences

Total operating expenses

(Loss) income from operations

( 2,323,711 )

Loss from operations

( 1,234,224 )

3 unchanged sentences

( 1,490,694 )

( 1,265,775 )

Loss on investment

1 unchanged sentence

( 1,436,098 )

( 1,194,233 )

Loss from operations before income taxes

( 2,660,868 )

Loss from operations before provision for income taxes

( 2,670,322 )

3 unchanged sentences

$ ( 1,301,864 )

$ ( 8,011,889 )

Basic and diluted net loss per share attributable to common stockholders

Basic and diluted weighted average common shares

accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

$ ( 2,660,868 )

( 2,931,370 )

$ ( 8,011,889 )

Other comprehensive income:

Unrealized gain in fair value of short-term investments

Comprehensive loss

$ ( 2,691,730 )

( 2,929,708 )

$ ( 8,076,010 )

accompanying notes are an integral part of these unaudited condensed consolidated financial statements

HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

THE THREE and NINE MONTHS ENDED September 30, 2024 and 2023

Stock- Series A

Stock- Series B

Additional Paid-in

Accumulated Other Comprehensive

Total Stockholders’

Balance, December 31, 2023

Net loss per common share Series A - basic and diluted

Net loss per common share Series B - basic and diluted

Weighted average shares outstanding Series A - basic and diluted

Weighted average shares outstanding Series B - basic and diluted

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

TRUGOLF HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024

Preferred Stock

Class A Common Stock

Class B Common Stock

Treasury Stock

Comprehensive

Balance at December 31, 2023

$ ( 2,037,000 )

5 unchanged sentences

( 3,854,693 )

Common stock Series A exchanged and issued in Merger

Common stock Series B issued in Merger

( 1,301,864 )

Balance, March 31, 2024

$ ( 2,037,000 )

$ ( 13,660,788 )

$ ( 9,072,623 )

Revaluation of costs of Merger

( 1,569,329 )

Balance, June 30, 2024

$ ( 2,037,000 )

$ ( 15,231,269 )

$ ( 10,508,104 )

Common stock issued for interest

Balance, September 30, 2024

$ ( 2,037,000 )

$ ( 15,291,447 )

$ ( 10,226,583 )

Balance, December 31, 2022

$ ( 2,037,000 )

$ ( 2,075,815 )

$ ( 3,430,759 )

Issuance of common stock for services

Unrealized gain in fair value of short term investments

( 5,351,178 )

Balance, March 31, 2023

Issuance of common stock - Series A exchanged in Merger

Issuance of common stock - Series B issued in Merger

( 1,301,864 )

Balance as of March 31, 2024

$ ( 2,037,000 )

Unrealized gain in fair value of short term investments

Balance, June 30, 2023

$ ( 13,660,788 )

$ ( 9,072,623 )

Balance at December 31, 2024

$ ( 2,037,000 )

2 unchanged sentences

$ ( 2,037,000 )

Unrealized gain in fair value of short term investments

$ ( 21,155,496 )

$ ( 4,640,781 )

Net income (loss)

Issuance of common stock for interest and make good

Issuance of common stock for conversion of notes

Stock-based compensation - options

( 2,670,322 )

Balance, September 30, 2023

Balance as of March 31, 2025

$ ( 2,037,000 )

4 unchanged sentences

$ ( 4,565,249 )

accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASHFLOWS

THE NINE MONTHS ENDED SEPTEMBER 30,

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

TRUGOLF HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

March 31, 2025

March 31, 2024

Cash flows from operating activities:

1 unchanged sentence

$ ( 1,301,864 )

Adjustments to reconcile net loss to net cash (used in) provided by operating activities:

Depreciation and amortization expense

Amortization of PIPE convertible notes original issue discount

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

Amortization of convertible notes discount

Amortization of right-of-use asset

Bad debt expense

Change in OCI

Stock issued for services

Stock issued for interest

Stock issued for make good provisions on debt conversion

Stock options issued to employees

Changes in operating assets and liabilities:

Accounts receivable, net

( 2,143,225 )

( 1,057,286 )

Inventory, net

2 unchanged sentences

Other current assets

( 2,026,082 )

Accounts payable

Customer deposits

Deferred revenue

Accrued interest

Accrued interest payable

Accrued and other current liabilities

Other liabilities

Lease liability

Net cash provided by (used in) operating activities

( 6,121,139 )

Cash flows from investing activities:

Purchase of property and equipment

Capitalized software development costs

( 1,967,418 )

Reduction in long term assets

( 2,419,725 )

Purchases of property and equipment

Capitalized software, net

Net cash used in investing activities

( 1,967,533 )

( 2,508,749 )

Cash flows from financing activities:

Proceeds from line of credit

Proceeds from notes payable

Repayments of notes payable

Repayments of notes payable - related party

Proceeds from notes payable - related party

Payments on assumed liabilities in Merger

Proceeds from convertible notes

PIPE loan, net of OID discount

Proceeds from PIPE loans, net of discount

Cash acquired in Merger

Increase in other liabilities

Costs of Merger paid from PIPE loan

( 2,082,787 )

Repayment of line of credit

Repayments of line of credit

( 1,980,937 )

Repayment of notes payable assumed in Merger

Dividends paid

Repayments of liabilities assumed in Merger

Repayments of notes payable

Repayments of notes payable - related party

Net cash provided by financing activities

Net change in cash , cash equivalents and restricted cash

( 4,181,925 )

Cash, cash equivalents, and restricted cash, beginning of period

Cash, cash equivalents and restricted cash, end of period

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for income tax

Cash paid for interest

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING and FINANCING ACTIVITIES:

Cash, cash equivalents and restricted cash - beginning of year

Cash, cash equivalents and restricted cash - end of year

Supplemental cash flow information:

Cash paid for:

Non-cash investing and financing activities:

PIPE note principal converted to Class A Common Stock

Notes payable assumed in Merger

2 unchanged sentences

$ ( 1,875,724 )

Right of Use Asset in exchange for lease liability

accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Holdings, Inc.

to the Condensed Consolidated Financial Statements (Unaudited)

1 - Business Organization and Nature of Operations

BUSINESS ORGANIZATION AND NATURE OF OPERATIONS

January 31, 2024 we completed the previously announced business combination pursuant to the terms of the Business Combination Agreement,

dated as of July 21, 2023, which provided for, TruGolf Nevada being the surviving corporation of the merger and having become a direct,

wholly owned subsidiary of Deep Medicine Acquisition Corp.

(“DMAC”), a Delaware corporation and our predecessor company (“DMAQ”)

as a consequence of the merger (together with the other transactions contemplated by the Business Combination Agreement).

In connection

with the consummation of the Business Combination, DMAQ changed its name to TruGolf Holdings, Inc.

TruGolf Holdings, Inc.’s Class

A common stock commenced trading on The Nasdaq Capital Market LLC under the ticker symbol “TRUG” on February 1, 2024.

accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

HOLDINGS, INC.

(the “Company” or “TruGolf”, “we”, “us”) was incorporated on July 8, 2020

as a Delaware corporation and formed for the purpose of effecting a business combination, with no material operation of its own.

operations are conducted through our subsidiary TruGolf, Inc., a Nevada Corporation (“TruGolf Nevada”).

TruGolf Nevada was

formed as a Utah corporation on October 4, 1995, under the name “TruGolf, Incorporated”.

TruGolf Nevada’s original

business plan was the creation of golfing video games.

On June 9, 1999, the TruGolf Nevada changed its name to “TruGolf, Inc.”

Effective on April 26, 2016, TruGolf Nevada filed Articles of Merger with the State of Utah, Department of Commerce, and on April 28,

2016, TruGolf Nevada filed Articles of Merger with the Secretary of State of Nevada, pursuant to which TruGolf, Inc., a Utah corporation,

merged with and into TruGolf Nevada, pursuant to a Plan of Merger.

TruGolf Nevada was the surviving corporation in the merger.

In connection

with the Plan of Merger, TruGolf Nevada affected a four-for-one forward stock split of its outstanding common stock.

over 40 years, TruGolf, Incorporated (or “the Company”, “we”, “us”, or “our”) has been

creating indoor golf software and hardware and are focused on both the residential and commercial golf simulation industries.

develop, manufacture and sell golf simulators for residential and commercial applications.

We offer portable, professional, commercial

and custom simulators.

In addition, to bundling our software with our simulators, we offer our E6 Connect software and gaming software

on a standalone basis.

We have leveraged the power of our hardware and software platform to create a collection of multi-sport games

including football, soccer, soccer golf, frisbee golf, zombie dodgeball, and cowboy target practice.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 – NATURE OF THE ORGANIZATION AND BUSINESS

of the Business

over 40 years, TruGolf Holdings, In.

(including its subsidiaries “the Company”, “we”, “us”, or “our”)

has been creating indoor golf software and hardware and are focused on both the residential and commercial golf simulation industries.

We design, develop, manufacture and sell golf simulators for residential and commercial applications.

We offer portable, professional,

commercial and custom simulators.

In addition, to bundling our software with our simulators, we offer our E6 Connect and E6 Apex software

as well as other gaming software on a standalone basis.

We have leveraged the power of our hardware and software platform to create a

collection of multi-sport games including football, soccer, soccer golf, frisbee golf, zombie dodgeball, and cowboy target practice.

Nevada has been creating indoor golf software for 40 years.

We began as a subsidiary of Access Software, Inc., a video game developer

based in Salt Lake City, Utah (“ Access Software ”), which was co-founded in November 1982, by Christopher Jones, the

Company’s largest stockholder, Chief Executive Officer, President and Chairman.

In April 1999, Access Software was purchased by

Microsoft Corp., for its expertise in golf software development.

Following the acquisition, the core programming and graphics team of

Links™, which created Links LS 1999, one of the bestselling PC sports games of 1999, were spun out to TruGolf Nevada.

based in Salt Lake City, Utah (“Access Software”), which was co-founded in November 1982, by Christopher Jones, the Company’s

largest stockholder, Chief Executive Officer, President and Chairman.

In April 1999, Access Software was purchased by Microsoft Corp.,

for its expertise in golf software development.

Following the acquisition, the core programming and graphics team of Links™, which

created Links LS 1999, one of the bestselling PC sports games of 1999, were spun out to TruGolf Nevada.

1999, we have focused on establishing residential and commercial golf simulation as a viable industry, and since 2007, we have focused

7 unchanged sentences

In addition, we have

developed multiple sources and 3 rd party manufacturers for the raw materials or parts for our products, including but not

limited to, steel or aluminum frames, fabric, turf, screens, projectors, PCs, cameras, lasers, infrared sensors, and supporting subsystems.

The availability of the frames and fabric from our principal provider, Allied ES&A, has been increased as they have moved into a

much larger facility directly located in a large employee base community and we have entered into negotiations with a second supplier

in order to provide alternative sourcing if needed.

A third supplier, Impact Signs, has also been used in the past and TruGolf Nevada

believes that it could purchase turf, and screen supplies from them as well if needed.

Both turf (Controlled Products), and screen suppliers

(Allied), are so specialized that we have come to rely on one vendor for each, respectively.

Turf particularly experienced some delivery

delays in 2022 that have been rectified, additional inventory has been secured locally, and our highest volume portable simulators have

been redesigned to use less raw materials from that vendor, while adding an improved hitting surface from a second vendor, Real Feel,

to mitigate risk.

developed multiple sources and 3rd party manufacturers for the raw materials or parts for our products, including but not limited to,

steel or aluminum frames, fabric, turf, screens, projectors, PCs, cameras, lasers, infrared sensors, and supporting subsystems.

The availability

of the frames and fabric from our principal provider, Allied ES&A, has been increased as they have moved into a much larger facility

directly located in a large employee base community and we have entered into negotiations with a second supplier in order to provide

alternative sourcing if needed.

A third supplier, Impact Signs, has also been used in the past and TruGolf Nevada believes that it could

purchase turf, and screen supplies from them as well if needed.

Both turf (Controlled Products), and screen suppliers (Allied), are so

specialized that we have come to rely on one vendor for each, respectively.

Turf particularly experienced some delivery delays in 2022

that have been rectified, additional inventory has been secured locally, and our highest volume portable simulators have been redesigned

to use less raw materials from that vendor, while adding an improved hitting surface from a second vendor, Real Feel, to mitigate risk.

Negotiations with a second supplier of screen materials is in progress.

Projectors (TV Specialists), PCs, lasers, IR

sensors and other systems come from multiple suppliers with no historical delay in supply.

We have 2 primary suppliers of cameras, IDS

and Basler, and have integrated products from both in the new Apogee unit to ensure the greatest availability possible.

Projectors (TV Specialists), PCs, lasers, IR sensors and other

systems come from multiple suppliers with no historical delay in supply.

We have 2 primary suppliers of cameras, IDS and Basler, and

have integrated products from both in the new Apogee unit to ensure the greatest availability possible.

Company is an “emerging growth company” as that term is used in the Jumpstart our Business Startups Act of 2012, and as such,

has elected to comply with certain reduced public company reporting requirements.

May 10, 2024 the Company formed a wholly owned subsidiary in the state of Delaware.

TruGolf Links Franchising, LLC (“Links”)

has a sole member, TruGolf, Inc.

Links was formed to establish and sell franchises that would use the Company’s indoor golf and

recreational sports simulators and other equipment.

Holdings, Inc.

(f/k/a Deep Medicine Acquisition Corp.) (the “Company” or “TruGolf”, “we”, “us”)

was incorporated on July 8, 2020 as a Delaware corporation and formed for the purpose of effecting a business combination, with no material

operation of its own.

Our operations are conducted through our subsidiary TruGolf, Inc., a Nevada Corporation (“TruGolf Nevada”).

TruGolf Nevada was formed as a Utah corporation on October 4, 1995, under the name “TruGolf, Incorporated”.

TruGolf Nevada’s

original business plan was the creation of golfing video games.

On June 9, 1999, the TruGolf Nevada changed its name to “TruGolf,

Inc.” Effective on April 26, 2016, TruGolf Nevada filed Articles of Merger with the State of Utah, Department of Commerce, and

on April 28, 2016, TruGolf Nevada filed Articles of Merger with the Secretary of State of Nevada, pursuant to which TruGolf, Inc., a

Utah corporation, merged with and into TruGolf Nevada, pursuant to a Plan of Merger.

TruGolf Nevada was the surviving corporation in

In connection with the Plan of Merger, TruGolf Nevada affected a four-for-one forward stock split of its outstanding common

January 31, 2024 the Company completed the previously announced business combination pursuant to the terms of the Agreement and Plan

of Merger, dated as of July 21, 2023 (as amended, the “Merger Agreement”), which provided for, Merger Sub to merge with and

into TruGolf Nevada, with TruGolf Nevada surviving as a direct, wholly owned subsidiary of Deep Medicine Acquisition Corp.

a Delaware corporation and TruGolf’s predecessor company as a consequence of the merger (together with the other transactions contemplated

by the Merger Agreement, the “Business Combination”).

In connection with the consummation of the Business Combination, DMAQ

changed its name to TruGolf Holdings, Inc.

TruGolf Holdings, Inc.’s Class A common stock commenced trading on The Nasdaq Global

Market under the ticker symbol “TRUG” on February 1, 2024.

May 10, 2024 the Company formed TruGolf Links Franchising, LLC (“Links”), a wholly owned subsidiary in the state of Delaware.

Links has a sole member, TruGolf, Inc.

Links was formed to establish and sell franchises that would use the Company’s indoor golf

and recreational sports simulators and other equipment.

Links offers a Service Area franchise agreement for a single location.

It also offers

a regional developer franchise agreement that allows the franchisee to sell franchises within its region.

The upfront fees range from

$ 45,000 to $ 100,000 .

Links has received proceeds of $ 500,000 from its CEO and $ 75,000 from a third party to purchase the franchise rights

to some regions yet to be determined.

offers a regional developer franchise agreement that allows the franchisee to sell franchises within its region.

The upfront fees range

from $ 45,000 to $ 100,000 .

Links has received proceeds of $ 500,000 from its CEO and $ 75,000 from a third party to purchase the franchise

rights to some regions yet to be determined.

As of September 30, 2024, the Company recorded $ 575,000 of deferred revenue and incurred

$ 306,539 of expenses that are included in selling, general and administrative category.

BUSINESS COMBINATION AND PURCHASE PRICE ALLOCATION

January 31, 2024 the Company consummated the business combination (the “Closing”) contemplated by the previously announced

Amended and Restated Agreement and Plan of Merger, dated as of July 21, 2023 (as amended, the “Merger Agreement”), by and

among the Company, DMAC Merger Sub Inc., a Nevada corporation and a wholly-owned subsidiary of the Company (“Merger Sub”),

Bright Vision Sponsor LLC, a Delaware limited liability company, in the capacity as the Purchaser Representative thereunder, Christopher

Jones, in the capacity as the Seller Representative thereunder, and TruGolf, Inc., a Nevada corporation (“TruGolf”).

result of the Closing and the transactions contemplated by the Merger Agreement, (i) Merger Sub merged with and into TruGolf (the “Merger”),

with TruGolf surviving the Merger as a wholly owned subsidiary of the Company, and (ii) the Company’s name was changed from Deep

Medicine Acquisition Corp.

(“DMAQ”) to TruGolf Holdings, Inc.

The Company’s Class A common stock commenced trading

on the Nasdaq Global Market LLC under the ticker symbol “TRUG” on February 1, 2024.

for the Business Combination

Merger is accounted for as a reverse recapitalization in accordance with U.S.

Under this method of accounting, DMAQ was treated

as the acquired company for accounting purposes, whereas TruGolf Nevada was treated as the accounting acquirer.

In accordance with this

method of accounting, the Business Combination has been treated as the equivalent of TruGolf Nevada issuing shares for the net assets

of DMAQ, accompanied by a recapitalization.

The net assets of DMAQ and TruGolf Nevada were stated at historical cost, with no goodwill

or other intangible assets recorded, and operations prior to the Business Combination were those of TruGolf Nevada.

TruGolf Nevada has

been determined to be the accounting acquirer for purposes of the Business Combination based on an evaluation of the following facts

and circumstances:

TruGolf Nevada stockholders have a majority of the voting power of New TruGolf,

Nevada comprising the ongoing operations of New TruGolf,

Nevada contributing a majority of the governing body members of New TruGolf, and

Nevada’s senior management comprising the senior management of New TruGolf.

of TruGolf Nevada Shares for Shares of New TruGolf

on 13,098 TruGolf Nevada ordinary shares outstanding immediately prior to the closing of the Business Combination, the Exchange Ratio

determined in accordance with the terms of the Merger Agreement is approximately 570.10 .

New TruGolf issued 7,467,134 shares of New TruGolf

common stock to legacy TruGolf Nevada shareholders in the Business Combination, determined as follows:

OF BUSINESS ACQUISITION CONTINGENT CONSIDERATION

TruGolf Nevada

shares outstanding

as of immediately

prior to the Closing

Ordinary shares, par value $0.01 per share

Exchange Ratio

Estimated shares of New TruGolf common stock issued to TruGolf Nevada shareholders upon Closing

shares issued to legacy TruGolf Nevada shareholders consists of 5,750,274 shares of New TruGolf Class A common stock and 1,716,860 shares

of New TruGolf Class B common stock.

purchase price for the Merger was allocated to the net assets acquired on the basis of historical costs with no goodwill or other intangible

assets recorded.

The following summarizes the allocation of the purchase price to net assets acquired in the Merger:

OF ALLOCATION OF PURCHASE PRICE TO NET ASSETS

Cash and cash equivalents

Net proceeds from investment fund (PIPE)

Accounts payable and accrued expenses

Loans payable

( 1,565,000 )

PIPE Convertible Notes payable assumed in Merger

Original Issue Discount of 10 %

PIPE Convertible Notes payable, net

Payment of closing costs and other expenses

( 1,947,787 )

Net proceeds from PIPE Convertible Notes payable assume in Merger

November 2, 2023 and December 7, 2023, Deep Medicine Acquisition Corp.

(“DMAQ”) executed loan agreements with certain accredited

investors (together, the “Prior Loan Agreements”) pursuant to which such investors agreed to loan DMAQ up to an aggregate

$ 11,000,000 in exchange for the issuance of convertible notes and warrants.

On February 2, 2024, TruGolf Holdings, Inc.

Holdings”) executed a securities purchase agreement (the “Purchase Agreement”) with each of the investors that executed

the Prior Loan Agreements, which replaced, in their entirety, the Prior Loan Agreements, and with additional investors (together, the

“PIPE Investors”).

Pursuant to the terms and conditions of the Purchase Agreement, the PIPE Investors agreed to purchase

from the TruGolf Holdings (i) senior convertible notes in the aggregate principal amount of up to $ 15,500,000 (the “PIPE Convertible

Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s Class A common stock (the “Series

A Warrants”);

and (iii) Series B warrants to initially purchase 1,550,000 shares of the TruGolf Holdings’ Class A common

stock (the “Series B Warrants,” and collectively with the Series A Warrants, the “PIPE Warrants”) (the “PIPE

Purchase Agreement contemplated the funding of the investment (the “Investment”) across multiple tranches.

At the first closing

(the “Initial Closing”) an aggregate principal amount of $ 4,650,000 of PIPE Convertible Notes were issued upon the satisfaction

of certain customary closing conditions in exchange for aggregate gross proceeds of $ 4,185,000 , representing an original issue discount

On such date (the “Initial Closing Date”), TruGolf Holdings also issued the PIPE Investors the Series A Warrants

and the Series B Warrants.

of September 30, 2024, the Company recorded PIPE Convertible Notes payable of $ 4,650,000 and an original issue discount of $ 465,000 resulting

in the net balance of $ 4,185,000 .

For the nine months ended September 30, 2024 the Company recorded interest expense on the PIPE Convertible

Notes of $ 647,047 , and interest expense relating to the amortization of the OID of $ 47,447 .

to satisfying the conditions discussed below, TruGolf Holdings, Inc.

has the right under the Purchase Agreement, but not the obligation,

to require that the PIPE Investors purchase additional Notes at up to two additional closings.

Upon notice at any time after the 2nd

trading day following the Initial Closing Date, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate

principal amount of $ 4,650,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $ 4,185,000 , if (i) the Registration

Statement (as described below) has been filed;

and (ii) certain customary closing conditions are satisfied (the “First Mandatory

Additional Closing”).

Upon notice at any time after the 2nd trading day following the date that the First Mandatory Additional

Closing is consummated, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate principal amount of $ 6,200,000

of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $ 5,580,000 , if (i) the shareholder approval is obtained (as described

(ii) the Registration Statement has been declared effective by the SEC;

and (iii) certain customary closing conditions are satisfied

(the “Second Mandatory Additional Closing”).

addition, pursuant to the Purchase Agreement, as amended by the Waiver (described below) each PIPE Investor has the right, but not the

obligation, to require that, upon notice, TruGolf Holdings sell to such PIPE Investor at one or more additional closings such PIPE Investor’s

pro rata share of up to a maximum aggregate principal amount of $ 10,850,000 in additional PIPE Convertible Notes (each such additional

closing, an “Additional Optional Closing”);

provided that, the principal amount of the additional PIPE Convertible Notes

issued at each Additional Optional Closing must equal at least $ 250,000 .

If a PIPE Investor has not elected to effect an Additional Optional

Closing on or prior to August 30, 2025, such PIPE Investor shall have no further right to effect an Additional Optional Closing under

the Purchase Agreement.

August 13, 2024, the Company entered into those certain waiver and amendment agreements (the “Waiver”), pursuant to which

the Company and the PIPE Investors agreed to:

(i) waive any breaches or defaults caused by the Company’s failure to timely file

its SEC reports through August 14, 2024;

(ii) extend the date by which the Additional Optional Closings may occur until 11 months from

the effective date of the initial Registration Statement;

(iii) permit the Company to raise debt financing from its affiliates through

non-convertible, unsecured notes with a maturity date that is later than the maturity date of the PIPE Convertible Notes;

certain registration failures until September 3, 2024 and permit the issuance of common stock to satisfy certain registration failures;

and (v) allow the Company to satisfy the interest payments due April 1, 2024, July 1, 2024 and October 1, 2024 from the issuance of common

stock or by allowing such amounts to be added to the principal amount of the PIPE Convertible Notes, at the option of the PIPE Investors.

In addition, certain PIPE Investors agreed to acquire additional PIPE Convertible Notes without regard to any volume or price requirements

in the instruments.

In connection with the Waiver, the Company issued an aggregate of 192,151

shares in satisfaction of certain registration

statement delay payments and issued an aggregate of 157,582

shares in satisfaction of outstanding interest

Such payments were made at the “Alternate Conversion Price” set forth in the PIPE Convertible Notes, which is equal

to the lesser of (i) the Conversion Price, and (ii) 90% of the lowest volume weighted average price of the Class A common stock during

the five consecutive trading days immediately prior to such conversion.

November 7, 2024, the Company entered into those certain amendments to the Waivers (the “Amendments”), pursuant to which the Company and

the PIPE Investors agreed to:

(i) waive any breaches or defaults caused by the Company’s failure to timely file its SEC reports

through August 21, 2024;

and (ii) waive certain registration failures until October 3, 2024.

In addition, the PIPE Investors waived any

breaches or defaults that may have occurred or will occur solely as a result of the Company’s failure to comply with the continued

listing requirements of the Nasdaq Stock Market due to:

(i) the Company’s failure to meet the stockholders’ equity requirement

for continued listing, provided that the foregoing waiver shall expire on January 15, 2025, (ii) the Company’s failure to meet the market value of publicly held shares requirement for continued listing,

provided that the foregoing waiver shall expire on January 15, 2025, and/or (iii) the Company’s failure to

meet the minimum bid price requirement for continued listing;

provided that the foregoing waiver shall expire on January 15, 2025, provided

further that to the extent the Company is in compliance with all other Nasdaq Stock Market listing requirements and has filed a preliminary

proxy statement to hold a special meeting to vote on a reverse stock split to remedy the bid price failure, the waiver shall be extended

to March 15, 2025.

In connection with the Amendment, the Company issued an aggregate of 116,959 shares in satisfaction of certain registration

statement delay payments and issued an aggregate of 65,790 shares in satisfaction of outstanding interest payments.

Such payments were

made at the “Alternate Conversion Price” set forth in the PIPE Convertible Notes, which is equal to the lesser of (i) the

Conversion Price, and (ii) 90% of the lowest volume weighted average price of the Class A common stock during the five consecutive trading

days immediately prior to such conversion.

November 7, 2024, certain PIPE Investors agreed to purchase additional PIPE Convertible Notes in aggregate principal amount of $ 3,300,000

for aggregate proceeds of $ 2,970,000 .

In connection with the foregoing, the Company agreed to repay an aggregate of $ 2,496,686 in outstanding

debt and transaction expenses.

3 – Summary of Significant Accounting Policies

July 15, 2024, the Company received a deficiency letter from the Listing Qualifications Department (the “Staff”) of the Nasdaq

Stock Market (“Nasdaq”) notifying the Company that since it failed to file its Form 10-Q for the period ended March 31, 2024

it no longer complied with Nasdaq Listing Rule 5250(c)(1).

The deficiency letter did not result in the immediate delisting of the Company’s

common stock from the Nasdaq Capital Market.

On August 14, 2024, the Company filed its Quarterly Report in the Form 10-Q for the period

ended March 31, 2024 and the Company regained compliance with the applicable Nasdaq rule.

August 19, 2024, the Company received a written notification (the “ Equity Notice”) from the Listing Qualifications Department

(the “Staff”) of the Nasdaq Stock Market (“Nasdaq”) notifying the Company that, based on the Company’s

Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, the Company’s stockholders’ equity was ($ 10,508,104 ),

and therefore, the Company was not in compliance with Nasdaq’s Listing Rule 5450(b)(1)(A), which requires a $ 10,000,000 minimum

stockholders’ equity standard (the “Global Equity Standard”).

to Nasdaq Marketplace Rule 5810(c)(2)(C), the Company was provided 45 calendar days, or until November 18, 2024, to supply a specific

plan to regain compliance with all Nasdaq Global Market listing requirements and the Company’s time frame to complete its plan.

The Company submitted its plan of compliance on November 18, 2024, which was accepted by the Staff, and Nasdaq granted an extension of

180 calendar days from the date of the Equity Notice, or until March 31, 2025, to evidence compliance.

On April 2, 2025, the Company

received a delist determination letter from the Staff (the “Nasdaq Notice”) advising the Company that the Staff had determined

that the Company had not regained compliance with the Global Equity Standard.

Accordingly, the Staff indicated that unless the Company

requests a hearing panel (a “Panel”) appeal of the delist determination by April 9, 2025, its securities would be delisted

on April 11, 2025.

April 9, 2025, the Company appealed Nasdaq’s determination to a Panel pursuant to the procedures set forth in the Nasdaq Listing

Rule 5800 Series to stay the suspension of the Company’s securities pending the Panel’s decision and the expiration of any additional extension period granted by the Panel following the hearing.

Such hearing has

been set for May 15, 2025.

November 5, 2024, the Company received a written notification (the “Bid Notice”) from the Staff notifying the Company that,

for the 30 consecutive business days ended November 4, 2024, the Company’s security did not maintain a minimum bid price of $ 1

Nasdaq stated in its letter that in accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has a compliance period

of 180 calendar days from the date of the Bid Notice (the “Compliance Period”), and that it may regain compliance if the

closing bid on the Company’s security is at least $1 for a minimum of ten consecutive days during the Compliance Period, which

will end May 5, 2025.

If the Company chooses to implement a reverse stock split, it must complete the split no later than 10 business

days prior to the expiration of the Compliance Period, in order to regain compliance.

November 5, 2024, the Company received an additional written notice (the “MVPHS Notice”) from the Staff notifying the Company

that, for 30 consecutive business days ended November 4, 2024, the Company’s market value of publicly held securities (“MVPHS”)

closed below the $15,000,000 MVPHS threshold required for continued listing on the Nasdaq Global Market under Nasdaq Listing Rule 5450(b)(2)(C)

(the “MVPHS Rule”).

Nasdaq stated in its letter that in accordance with Nasdaq Listing Rule 5810(c)(3)(D), the Company has

a compliance period of 180 calendar days from the date of the MVPHS Notice, and it may regain compliance if at any time during the Compliance

Period the MVPHS closes at $15,000,000 or more for a minimum of ten consecutive business days.

May 7, 2025, the Company received written notice (the “MVPHS Notice”) from Nasdaq stating that the Company had not regained

compliance with the MVPHS requirement or the bid price requirement.

The Company intends to present to the Panel at the hearing a plan

to regain compliance with all the continued listing requirements of Nasdaq, including the MVPHS requirement and the bid price requirement.

accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue as

a going concern, which contemplates realization of assets and satisfying liabilities in the normal course of business.

At March 31, 2025,

the Company has an accumulated deficit of approximately $ 23.8 million and working capital surplus of approximately $ 30,000 .

For the three

months ended March 31, 2025, the Company had a loss from operations of approximately $ 1.2 million and negative cash flows from operations

of approximately $ 449,000 .

Although the Company is showing positive revenue growth and gross profit trends, the Company expects to incur

further losses through the end of 2025.

date the Company has been funding operations primarily through the reinvestment of free cash flows generated from our business operations,

sale of equity in private placements, PIPE convertible debt instruments and revenues generated by the Company’s services.

the three months ended March 31, 2025, the Company received $ 2,520,000 in proceeds from the issuance of PIPE Convertible Notes, net of

$ 280,000 in original issue discounts, from a PIPE Convertible Note.

on its current cash resources and commitments, the Company believes it will be able to maintain its current planned development and corresponding

level of expenditure for at least twelve months from the date of the issuance of these consolidated financial statements, although no

assurance can be given that it will not need additional funds prior to such time.

accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally

accepted in the United States of America (“GAAP”), which contemplate continuation of the Company as a going concern and the

realization of assets and satisfaction of liabilities in the normal course of business.

The carrying amounts of assets and liabilities

presented in the unaudited condensed consolidated financial statements do not necessarily purport to represent realizable or settlement

The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might be necessary

should the Company be unable to continue as a going concern.

2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation - Unaudited Interim Financial Information

accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with accounting

principles generally accepted in the United States of America (“U.S.

GAAP”) for interim financial information, and in accordance

with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q

and Article 8 of Regulation S-X.

Accordingly, they do not include all of the information and footnotes required by U.S.

GAAP for complete

financial statements.

The unaudited condensed financial statements reflect all adjustments (consisting of normal recurring accruals)

which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented.

Interim results

are not necessarily indicative of the results for the full year.

information and disclosures normally included in the notes to the annual consolidated financial statements have been condensed or omitted

from these interim unaudited condensed consolidated financial statements.

Accordingly, these interim unaudited condensed consolidated

financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Registration

Statement on Form S-1 effective as of September 30, 2024 and in Form 8-K/A as filed with the SEC on April 17, 2024.

of Presentation – Accounting for the Business Combination

Merger was accounted for as a reverse recapitalization in accordance with U.S.

Under this method of accounting, DMAQ was treated

as the acquired company for accounting purposes, whereas TruGolf Nevada was treated as the accounting acquirer.

In accordance with this

method of accounting, the Business Combination was treated as the equivalent of TruGolf Nevada issuing shares for the net assets of DMAQ,

accompanied by a recapitalization.

The net assets of DMAQ and TruGolf Nevada were stated at historical cost, with no goodwill or other

intangible assets recorded, and operations prior to the Business Combination were those of TruGolf Nevada.

TruGolf Nevada has been determined

to be the accounting acquirer for purposes of the Business Combination based on an evaluation of the following facts and circumstances:

TruGolf Nevada stockholders have a majority of the voting power of New TruGolf,

Nevada comprising the ongoing operations of New TruGolf,

Nevada contributing a majority of the governing body members of New TruGolf, and

Nevada’s senior management comprising the senior management of New TruGolf.

of Presentation – Principles of consolidation

unaudited condensed consolidated financial statements include the financial statements of the Company and its subsidiaries.

All significant

intercompany transactions and balances between the Company and its subsidiaries are eliminated upon consolidation.

of Presentation

accompanying unaudited condensed consolidated financial information as of and for the three months ended March 31, 2025 and 2024 has

been prepared in accordance with GAAP for interim financial information and with the instructions to Quarterly Report on Form 10-Q and

Article 10 of Regulation S-X.

In the opinion of management, such financial information includes all adjustments (consisting only of normal

recurring adjustments) considered necessary for a fair presentation of our financial position at such dates and the operating results

and cash flows for such periods.

Operating results for the three months ended March 31, 2025 are not necessarily indicative of the results

that may be expected for the entire year or for any other subsequent interim period.

information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant

to the rules of the U.S.

Securities and Exchange Commission (the “SEC”).

These unaudited financial statements and related

notes should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2024 included

in the Company’s Annual Report on Form 10-K filed with the SEC on April 15, 2025.

of Consolidation

Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America,

8 unchanged sentences

Actual results may differ from these estimates.

condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries.

All significant intercompany

accounts and transactions have been eliminated in consolidation.

Reclassifications

reclassifications have been made to the unaudited condensed consolidated financial statements for the three months ended March 31, 2024

to conform to the unaudited condensed consolidated financial statement presentation for the three months ended March 31, 2025.

reclassifications had no effect on net loss or cash flows as previously reported.

unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions

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

condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

On an ongoing

basis, management evaluates these estimates and judgments.

Actual results could differ from those estimates.

estimates relate primarily to determining the net realizable value and demand for inventory, useful lives associated with property and

equipment and capitalized software, valuation allowances with respect to deferred tax assets, contingencies, and the valuation and assumptions

underlying share-based compensation and equity warrants.

On an ongoing basis, management evaluates its estimates compared to historical

experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities.

and Cash Equivalents

and cash equivalents include all cash on hand, demand deposits and short-term investments with original maturities of three months or

less when purchased.

of September 30, 2024 and December 31, 2023, the Company’s cash and cash equivalents consisted of $ 7,452,185 and $ 5,397,564 , respectively.

The Company maintains its cash in banks insured by the Federal Deposit Insurance Corporation in accounts that at times may exceed the

federally insured limit of $ 250,000 per bank.

The Company minimizes this risk by placing its cash deposits with major financial institutions.

At September 30, 2024 and December 31, 2023 the uninsured balances amounted to $ 6,125,053 and $ 4,251,124 respectively.

Company considers all highly liquid investments with an original maturity of 90 days or less to be cash equivalents.

Cash equivalents

primarily consist of institutional money market funds, U.S.

Treasury securities, certificates of deposit, and commercial paper and are

carried at cost, which approximates fair value.

Concentration

of Credit Risk

Company maintains the majority of its cash and cash equivalents in accounts with large financial institutions.

At times, balances in

these accounts may exceed federally insured limits;

however, to date, the Company has not incurred any losses on its deposits of cash

and cash equivalents.

Investment Securities

Company’s marketable investment securities are comprised of investments in corporate fixed income securities and U.S.

The Company designates investments in debt securities as available-for-sale.

Available-for-sale debt securities with original

maturities of three months or less from the date of purchase are classified within cash and cash equivalents.

Available-for-sale debt

securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income

(loss), a component of stockholders’ equity, net of tax.

Realized gains and losses on the sale of marketable securities are determined

using the average cost method on a first-in, first-out basis and recorded in total other income (expense), net in the statements of operations

Company generally invests its excess cash in investments in corporate fixed income securities and U.S.

Treasury securities.

Such investments

are included in cash and cash equivalents or marketable investment securities on the accompanying consolidated balance sheets and are

classified based on original maturity.

The Company considers all highly liquid investments with an original maturity date of 90 days

or less to be cash equivalents and considers all highly liquid investments with an original maturity greater than 90 days and less than

one year to be marketable securities.

fixed income securities are classified as available-for-sale and reported at fair value with unrealized gains and losses included in

accumulated other comprehensive income (loss).

Realized gains and losses on the sale of marketable securities are determined using the

average cost method on a first-in, first-out basis and recorded in total other income (expense), net in the statements of operations

and comprehensive loss.

The Company sold and liquidated most of its marketable securities during the nine months ended September 30,

2024 resulting in a balance of $ 10,114 as of that date and is included with cash and cash equivalents.

Each reporting period, the Company evaluates whether declines in fair value below carrying value are due to expected

credit losses, as well as its ability and intent to hold the investment until a forecasted recovery of the carrying value occurs.

credit losses are recorded as an allowance through other income (expense), net on the Company’s consolidated statements of operations.

the three months ended March 31, 2024, the Company sold and liquidated most of its marketable securities resulting in a gain of $ 1,662

recorded in the unaudited condensed consolidated statements of comprehensive gain (loss).

Marketable investment securities had a balance

of $ 10,114 as of March 31, 2025 and December 31, 2024, respectively, and are included with cash and cash equivalents on the unaudited

condensed consolidated balance sheets.

Receivable, net

manage credit risk associated with our accounts receivable at the customer level.

Because the same customers typically generate the revenues

that are accounted for under both Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606) and

Accounting Standards Codification Topic 326, Credit Losses (Topic 326)., the discussions below on credit risk and our allowances for

doubtful accounts address our total revenues from Topic 606 and Topic 326.

believe the concentration of credit risk, with respect to our receivables, is limited because our customer base is comprised of a number

of geographically diverse customers.

We manage credit risk through credit approvals and other monitoring procedures.

to Topic 326 for our accounts receivables, we maintain an allowance for doubtful accounts that reflects our estimate of our expected

credit losses.

Our allowance is estimated using a loss rate model based on delinquency.

The estimated loss rate is based on our historical

experience with specific customers, our understanding of our current economic circumstances, reasonable and supportable forecasts, and

our own judgment as to the likelihood of ultimate payment based upon available data.

We believe our credit risk is somewhat mitigated

by our geographically diverse customer base and our credit evaluation procedures.

The actual rate of future credit losses, however, may

not be similar to past experience.

Our estimate of doubtful accounts could change based on changing circumstances, including changes

in the economy or in the particular circumstances of individual customers.

Accordingly, we may be required to increase or decrease our

allowance for doubtful accounts.

Based on management’s evaluation, there is a balance in the allowance for doubtful accounts of

$ 1,295,533 and $ 1,227,136 as of September 30, 2024 and December 31, 2023, respectively.

of our inventory consists of raw materials and are valued at the lower of historic cost or net realizable value;

where net realizable

value is considered to be the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion,

disposal and transportation.

receivable are reported at their outstanding unpaid principal balances, net of allowances for credit losses.

The Company periodically

assesses its accounts and other receivables for collectability on a specific identification basis.

The Company estimates its allowance

using a rate loss model based on delinquency.

The estimated loss rate is based on historical experience with specific customers, understanding

of the Company’s current economic circumstances, reasonable and supportable forecasts, and the Company’s judgment as to the

likelihood of ultimate payment based upon available data.

Management believes the Company’s credit risk is mitigated by the geographically

diverse customer base and its credit evaluation procedures.

The actual rate of future credit losses, however, may not be similar to past

The Company writes off accounts receivable against the allowance for credit losses when a balance is determined to be

uncollectable.

As of March 31, 2025 and December 31, 2024, the Company’s allowance for credit losses was $ 1,424,074 and $ 1,470,868 ,

respectively.

Company’s inventory consists of raw materials and are valued at the lower of historical cost or net realizable value, where net

realizable value is considered to be the estimated selling price in the ordinary course of business, less reasonably predictable cost

of completion, disposal and transportation.

Historic inventory costs are calculated on an average or specific cost basis.

The Company records inventory

write-downs for excess or obsolete inventories based upon assumptions on current and future demand forecasts.

As of September 30, 2024

and December 31, 2023, the Company had $ 448,360 and $ 429,050 , respectively, reserved for obsolete inventory.

Value of Financial Instruments

value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction

between market participants at the measurement date.

The Financial Accounting Standards Board (“FASB”) fair value measurement

guidance established a fair value hierarchy that prioritizes the inputs used to measure fair value.

The three broad levels of the fair

value hierarchy are as follows:

prices (unadjusted) in active markets for identical assets or liabilities,

prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly

or indirectly,

inputs for which little or no market data exists, therefore requiring a company to develop its own assumptions.

and liabilities are classified based on the lowest level of input that is significant to the fair value measurements.

We review the fair

value hierarchy classification on a quarterly basis.

Changes in the observable inputs may result in a reclassification of assets and

liabilities within the three levels of the hierarchy outlined above.

records inventory write-downs for excess or obsolete inventories based upon assumptions on current and future demand forecasts.

both March 31, 2025 and December 31, 2024, the Company had $ 448,360 reserved for obsolete inventory.

and Equipment

property and equipment are recorded at cost and depreciated using the straight-line over the estimated useful lives.

Ordinary repair

and maintenance costs are included in sales, general and administrative (“SG&A”) expenses on our statements of operations.

However, expenditures for additions or improvements that significantly extend the useful life of the asset are capitalized in the period

At the time assets are sold or disposed of, the cost and accumulated depreciation are removed from their respective accounts

and the related gains or losses are reflected in the statements of operations in gains from sales of property and equipment, net.

periodically evaluate the appropriateness of remaining depreciable lives assigned to property and equipment.

Generally, we assign the

following estimated useful lives to these categories:

and equipment are stated at cost less accumulated depreciation and amortization.

Depreciation is calculated over the estimated useful

lives of the related assets using the straight-line method.

Amortization of leasehold improvements is computed using the straight-line

method over the shorter of the remaining lease term (including renewals that are reasonably assured) or the estimated useful lives of

the improvements.

For internal-use software, external costs and employee payroll expenses directly associated with developing new or

enhancing existing software applications are capitalized subsequent to the preliminary stage of development.

Internal-use software costs

are amortized using the straight-line method over the estimated useful life of the software when the project is substantially complete

and ready for its intended use.

OF ESTIMATED USEFUL LIVES

and computer equipment

equipment and software

for major additions and improvements are capitalized, and minor replacements, maintenance, and repairs are expensed as incurred.

property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and

any resulting gains or losses are included in the Company’s results of operations for the respective period.

Software Development Costs

capitalize certain costs related to the development of our software used in our simulators.

In accordance with authoritative guidance,

including ASC 985-20, Software-Costs of Software to be Sold, Leased or Marketed , we began to capitalize these costs when the technological

feasibility was established and preliminary development efforts were successfully completed, management authorized and committed project

funding, and it was probable that the project would be completed and the software would be used as intended.

Such costs are amortized

when placed in service, on a straight-line basis over the estimated useful life of the related asset, estimated to be three years beginning

on February 1, 2024.

Costs incurred prior to meeting these criteria together with costs incurred for training and maintenance are expensed

as incurred and recorded in product development expenses on our statements of operations.

The Company does not capitalize any testing

or maintenance costs.

The accounting for these capitalized software costs requires us to make significant judgments, assumptions and

estimates related to the timing and amount of recognized capitalized software development costs.

For the nine months ended September

30, 2024 we capitalized $ 1,967,418 of costs related to the development of software applications.

Amortization of capitalized software

costs was $ 279,001 for the for the nine months ended September 30, 2024.

Company capitalizes certain costs related to the development of our software used in our simulators.

In accordance with authoritative

guidance, including the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) 985-20, Software

– Costs of Software to be Sold, Leased, or Marketed, the Company began to capitalize these costs when the technological feasibility

was established and preliminary development efforts were successfully completed, management authorized and committed project funding,

and it was probable that the project would be completed and the software would be used as intended.

Such costs are amortized when placed

in service, on a straight-line basis over the estimated life of the related asset, estimated to be three years beginning on February

Costs incurred prior to meeting these criteria together with costs incurred for training and maintenance are expensed as incurred

and recorded in selling, general and administrative expenses on our consolidated statements of operations.

The Company does not capitalize

any testing or maintenance costs.

The accounting for these capitalized software costs requires management to make significant judgments,

assumptions and estimates related to the timing and amount of recognized capitalized software development costs.

Property and Equipment, Net for further details.

of Long-Lived Assets

long-lived assets principally consist of property and equipment and right-of-use assets.

We review, on a regular basis, our long-lived

assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

In reviewing for impairment, the carrying value of such assets is compared to the estimated undiscounted future cash flows expected from

the use of the assets and their eventual disposition.

If such cash flows are not sufficient to support the asset’s recorded value,

an impairment charge is recognized to reduce the carrying value of the asset to its estimated fair value.

The determination of future

cash flows as well as the estimated fair value of long-lived and intangible assets involves significant estimates and judgment on the

part of management.

Our estimates and assumptions may prove to be inaccurate due to factors such as changes in economic conditions, changes

in our business prospects or other changing circumstances.

Based on our most recently completed reviews, there were no indications of

impairment associated with our long-lived assets.

lease portfolio is substantially comprised of operating leases related to leases for our corporate headquarters and warehouse.

determine whether an arrangement is a lease at the inception of the arrangement based on the terms and conditions in the contract.

contract contains a lease if there is an identified asset, and we have the right to control the asset for a period of time in exchange

for consideration.

Lease arrangements can take several forms.

Some arrangements are clearly within the scope of lease accounting, such

as a real estate contract that provides an explicit contractual right to use a building for a specified period of time in exchange for

consideration.

However, the right to use an asset can also be conveyed through arrangements that are not leases in form, such as leases

embedded within service and supply contracts.

We analyze all arrangements with potential embedded leases to determine if an identified

asset is present, if substantive substitution rights are present, and if the arrangement provides the customer control of the asset.

lease right-of-use (“ROU”) assets represent our right to use an individual asset for the lease term and lease liabilities

represent our obligation to make lease payments arising from the lease.

Operating lease ROU assets and liabilities are recognized at

the commencement date based on the present value of lease payments over the lease term.

As most of our leases do not provide the lessor’s

implicit rate, we use our incremental borrowing rate (“IBR”) at the commencement date in determining the present value of

lease payments by utilizing a fully collateralized rate for a fully amortizing loan with the same term as the lease.

terms include options to extend the lease when it is reasonably certain those options will be exercised.

For leases with terms greater

than 12 months, we record the related asset and obligation at the present value of lease payments over the term.

Our leases can include

rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when

such renewal options and/or termination options are reasonably certain of exercise.

ROU asset is subject to the same impairment guidance as assets categorized as property and equipment.

As such, any impairment loss on

ROU assets is presented in the same manner as an impairment loss recognized on other long-lived assets.

lease modification is a change to the terms and conditions of a contract that changes the scope or consideration of a lease.

a change to the terms and conditions to the contract that adds or terminates the right to use one or more underlying assets, or extends

or shortens the contractual lease term, is a modification.

Depending on facts and circumstances, a lease modification may be accounted

for as either:

(1) the original lease plus the lease of a separate asset(s) or (2) a modified lease.

A lease will be remeasured if there

are changes to the lease contract that do not give rise to a separate lease.

recognize revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)

standards - Topic 606 “Revenue from Contracts with Customers” (“Topic 606”).

entering into contracts with our customers, we review the following five steps of Topic 606:

the contract with the customer.

the performance obligation.

the transaction price.

the transaction price to the performance obligation.

the satisfaction of the performance obligation.

account for contracts, with our customers, when we have approval and commitment from both parties, the rights of the parties are identified,

payment terms are established, the contract has commercial substance and collectability of consideration is probable.

Topic 606, we recognize revenue only when we satisfy a performance obligation by transferring a promised good or service to our customer

and completion of all performance obligations.

A good or service is considered transferred when the customer obtains control.

defines control as an entity’s ability to direct the use of, and obtain substantially all of the remaining benefits from, an asset.

We recognize revenue once control has passed to the customer.

The following indicators are evaluated in determining when control has

passed to the customer:

have a right to a payment for the product or service.

customer has legal title to the product.

have transferred physical possession of the product to the customer.

customer has the risk and rewards of ownership of the product.

customer has accepted the product.

Recognition for Golf Simulators.

Revenues from the sale of golf simulators are recognized with the selling price to the customer

recorded as revenues and the acquisition cost of the product recorded as cost of revenues.

We recognize revenue from these transactions

when control has passed to the customer and the performance obligations have been satisfied.

Control is considered to have passed to

the customer when the simulators has been delivered, installed and accepted by the customer.

Golf simulators are bundled and are comprised

of both hardware and a software license (for the software to operate the simulator).

Our simulator contracts with customers generally

do not include multiple performance obligations.

Recognition for Content Software Subscriptions .

The Company offers content software subscriptions for one and twelve months.

revenue from these transactions when control has passed to the customer and the performance obligations have been satisfied.

is considered to have passed to the customer when the software license has been delivered and accepted by the customer.

The content software

subscription revenue is recognized over the term of the contract.

Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such

assets may not be recoverable.

Conditions that would necessitate an impairment assessment include a significant decline in the observable

market value of an asset, a significant change in the extent or manner in which an asset is used, or any other significant adverse change

that would indicate that the carrying amount of an asset or group of assets may not be recoverable.

For asset groups held and used, the

carrying value of the asset group is considered recoverable when the estimated undiscounted future cash flows expected to be generated

from the use and eventual disposition of the asset group exceed the respective carrying value.

In the event the carrying value is not

recoverable, an impairment charge would be recognized for the asset group to be held and used equal to the excess of the carrying value

above the estimated fair value of the asset group.

Impairment charges are recognized within selling, general and administrative expenses

in the consolidated statements of operations.

The Company did not record a loss on impairment during the three months ended March 31,

2025 and 2024, respectively.

and Marketing Costs

Company expenses advertising and marketing costs as they are incurred.

Advertising and marketing expenses were $ 352,291 and $ 111,489

for the three months ended March 31, 2025 and 2024, respectively, and are recorded in operating expenses on the unaudited condensed consolidated

statements of operations.

with Warrants

accordance with ASC 470-20-25, when the Company issued debt with warrants, the Company treats the fair value of the warrants as a debt

discount, recorded as a contra-liability against the debt, and amortizes the balance over the life of the underlying debt as amortization

of debt discount expense in the unaudited condensed consolidated statements of operations using the straight-line method.

to the contra-liability is recorded as either equity or liability in the Company’s unaudited condensed consolidated balance sheets

depending on the accounting treatment of the warrants.

If the debt is retired early, the associated debt discount is then recognized

immediately as amortization of debt discount expense in the unaudited condensed consolidated statements of operations.

Value Measurements

defined in ASC 820, Fair Value Measurements and Disclosures, fair value is the price that would be received to sell an asset or paid

to transfer a liability in an orderly transaction between market participants at the measurement date (exit price).

The Company utilizes

market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and

the risks inherent in the inputs to the valuation technique.

These inputs can be readily observable, market corroborated, or generally

unobservable.

ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value.

The hierarchy gives

the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the

lowest priority to unobservable inputs (Level 3 measurement).

This fair value measurement framework applies at both initial and subsequent

prices are available in active markets for identical assets or liabilities as of the reporting date.

Active markets are those in

which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing

inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as

of the reported date.

Level 2 includes those financial instruments that are valued using models or other valuation methodologies.

These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities,

time value, volatility factors and current market and contractual prices for the underlying instruments, as well as other relevant

economic measures.

Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument,

can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace.

inputs include significant inputs that are generally less observable from objective sources.

These inputs may be used with internally

developed methodologies that result in management’s best estimate of fair value.

The significant unobservable inputs used in

the fair value measurement for nonrecurring fair value measurements of long-lived assets include pricing models, discounted cash

flow methodologies and similar techniques.

Value of Financial Instruments

carrying value of cash, accounts receivable, accounts payable and accrued expenses, and other current liabilities approximate their fair

values using Level 1 inputs, based on the short-term maturity of these instruments.

The carrying amount of notes payable approximate

the estimated fair value for this financial instrument as management believes that such debt and interest payable on the notes approximates

the Company’s incremental borrowing rate.

The following table shows the Company’s cash, cash equivalents, restricted cash,

marketable securities, and derivative liabilities by significant investment category as of March 31, 2025 and December 31, 2024:

OF FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value at December 31, 2023

Money market funds

Corporate fixed income securities

treasury securities

( 2,026,271 )

Derivative liability (1)

Fair value at December 31, 2024

Derivative liability (2)

Fair value at March 31, 2025

the year ended December 31, 2024, the Company recorded a derivative liability related to

the PIPE Warrants of $ 142,319 .

During the year ended December 31, 2024, the Company recorded

a gain on fair value remeasurement of $ 142,319 .

the three months ended March 31, 2025, the Company did not record a loss on fair value remeasurement.

lease is defined as a contract that conveys the right to control the use of identified property, plant or equipment for a period of time

in exchange for consideration.

accordance with ASC 842, Leases, the Company recognized a right-of-use (“ROU”) asset and corresponding lease liability on

its balance sheets for its office space and warehouse.

See Note 17 – Leases for further discussion, including the impact

on the Company’s unaudited condensed consolidated financial statements and related disclosures.

assets include any prepaid lease payments and exclude any lease incentives and initial direct costs incurred.

Lease expense for minimum

lease payments is recognized on a straight-line basis over the lease term.

The lease terms may include options to extend or terminate

the lease if it is reasonably certain that the Company will exercise that option.

in which the Company is the lessee are comprised of office and warehouse rental.

All of the leases are classified as operating leases.

The Company has two lease agreements with remaining terms of 3.1 years and 8 months.

tax assets and liabilities are recognized for the future tax consequences attributable to differences between the unaudited condensed

consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

Deferred tax assets,

including tax loss and credit carry forwards, and liabilities are measured using enacted tax rates expected to apply to taxable income

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

The effect on deferred tax assets and liabilities

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

Company utilizes ASC 740, Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future

tax consequences of events that have been included in the unaudited condensed consolidated financial statements or tax returns.

accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and liabilities

and the related financial amounts, using currently enacted tax rates.

A valuation allowance is recorded when it is “more likely

than not” that a deferred tax asset will not be realized.

At March 31, 2025 and December 31, 2024, the Company’s net deferred

tax asset has been fully reserved.

uncertain tax positions that meet a “more likely than not” threshold, the Company recognizes the benefit of uncertain tax

positions in the unaudited condensed consolidated financial statements.

The Company’s practice is to recognize interest and penalties,

if any, related to uncertain tax positions in income tax expense in the unaudited condensed consolidated statements of operations when

a determination is made that such expense is likely.

Recognition Policy

is recognized upon satisfaction of all contractual performance obligations and transfer of control to the customer and is measured as

the amount of consideration to which the Company expects to be entitled to in exchange for corresponding goods or services.

transaction results in an implicit contract with the customer to deliver a product or service at the point of sale.

The Company has two

distinct revenue streams:

golf simulators and content software subscriptions.

obligations under our contracts consist of hardware, software consisting of perpetual licenses and subscription licenses, and support

within a single operating segment.

Simulators – Substantially all the Company’s sales are multiple performance obligation arrangements for its golf simulators,

for which the transaction price is equivalent to the stated price of the product or service, net of any stated discounts applicable at

a point in time.

Golf simulators are bundled and are comprised of both hardware, a software license (for the software to operate the

simulator), and a content software subscription license.

Revenue from golf simulators is recognized at the point in time when installation

(hardware and software) has occurred and has been accepted by the customer.

For transactions where the Company utilizes a third-party

to complete the installation, the Company recognizes revenue solely for the simulator hardware upon delivery to the customer or third-party

installer and then recognizes the remainder of the revenue upon installation and customer acceptance.

License – Golf simulators require specific proprietary software to run the simulations.

The Company records revenue from the proprietary

software products under perpetual licenses.

Revenue from the perpetual licenses is recognized at the time of installation and customer

Software Subscriptions – The Company offers content software subscriptions for one and twelve months.

We recognize revenue from

these transactions when control has passed to the customer and the performance obligations have been satisfied.

Control is considered

to have passed to the customer when the software license has been delivered and accepted by the customer.

The content software subscription

revenue is recognized over the term of the contract.

revenue represents either customer advance payments or performance obligations that have not yet been met.

from golf simulators and perpetual software licenses is deferred and primarily recognized upon the installation of the golf simulators

and acceptance from the customer.

Revenue from content software subscriptions is deferred and recognized ratably over the life of the

subscription (one or twelve months).

During the three months ended March 31, 2025, the Company recognized approximately $ 1.2 million

of golf simulator and subscription services revenue, respectively, that was included in deferred revenue balances at the beginning of

Performance Obligations

of March 31, 2025, approximately $ 4.1 million of revenue is expected to be recognized from remaining performance obligations.

expects to recognize 100 % of this revenue over the next 12 months.

Disaggregated

OF DISAGGREGATED REVENUE

Three Months Ended March 31,

Golf Simulators (1)

Content Software Subscriptions

Franchise Revenue

Total net revenue

Includes items such as hardware and proprietary perpetual licenses

Includes items such as shipping income and installation income

of revenue includes direct materials, labor, manufacturing overhead costs and reserves for estimated warranty cost (excluding depreciation).

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value and to provide for on-hand inventories that are either obsolete or in excess of forecasted demand, as consistently reviewed by

During the nine months ended September 30, 2024 and 2023, the Company recorded an expense of $ 123,891 and $ 36,992 in inventory

write-down, respectively.

have royalty agreements with certain software suppliers to pay royalties based on the number of units and subscriptions sold.

percentages range between 20 % and 30 %.

Royalty expense for the nine months ended September 30, 2024 and 2023 was $ 719,668 and $ 447,366 ,

During the three months ended March 31, 2025 and 2024, the Company recorded an expense of $ 0 and $ 171,502 in inventory write-down,

respectively.

Company utilizes the asset and liability approach to measure deferred tax assets and liabilities based on temporary differences existing

at each balance sheet date using currently enacted tax rates in accordance with ASC 740.

ASC 740 considers the differences between financial

statement treatment and tax treatment of certain transactions.

Deferred tax assets and liabilities are recognized for the future tax

consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their

respective tax bases.

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 of a change in tax rate is recognized

as income or expense in the period that includes the enactment date of that rate.

Prior to the Merger, the Company elected to be taxed

as an S-Corporation that passes through all income and deductions to its members.

The Company did not have any deferred tax benefits

or liabilities prior to January 31, 2024.

Company has no tax positions as of September 30, 2024 and December 31, 2023 for which the ultimate deductibility is highly certain but

for which there is uncertainty about the timing of such deductibility.

Company recognizes any interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses.

For the nine months ending September 30, 2024 and 2023, the Company recognized no interest and penalties.

Earnings (Loss) Per Share

income (loss) per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”.

Basic net income (loss) per

common share (“EPS”) is computed by dividing income available to common stockholders by the weighted-average number of common

shares outstanding for the period.

Diluted earnings per share is computed by dividing net income by the weighted average shares outstanding,

assuming all dilutive potential common shares were issued, unless doing so is anti-dilutive.

The computation of basic and diluted income

(loss) per share for the nine months ended September 30, 2024 and 2023 excludes potentially dilutive securities when their inclusion

would be anti-dilutive, or if their exercise prices were greater than the average market price during the period.

There were no potential

dilutive shares as September 30, 2023.

potential dilutive shares as of September 30, 2024 consisted of the following:

Company has royalty agreements with certain software suppliers to pay royalties based on the number of units and subscriptions sold.

The royalty percentages range between 20 % and 30 %.

Royalty expense for the three months ended March 31, 2025 and 2024, was $ 225,320 and

$ 329,888 , respectively.

Loss Per Common Share

loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period.

All outstanding options and warrants are considered potentially outstanding common stock.

The dilutive effect, if any, of stock options

or warrants is calculated using the treasury stock method.

All outstanding convertible notes are considered common stock at the beginning

of the period or at the time of issuance, if later, pursuant to the if-converted method.

following table sets forth the computations of loss per share:

OF LOSS PER SHARE

Three Months Ended March 31,

$ ( 2,670,322 )

$ ( 1,301,864 )

Weighted-average common shares Series A outstanding, basic and diluted

Weighted-average common shares Series B outstanding, basic and diluted

Net loss per common share Series A, basic and diluted

Net loss per common share Series B, basic and diluted

the effect of common stock equivalents is anti-dilutive with respect to losses, the options, warrants and shares issuable upon conversion

have been excluded from the Company’s computation of net loss per common share for the three months ended March 31, 2025 and 2024.

following table summarizes the securities that were excluded from the diluted per share calculation because the effect of including these

potential shares was anti-dilutive due to the Company’s net loss position even though the exercise price could be less than the

average market price of the common shares:

OF POTENTIAL DILUTIVE SHARES

PIPE Convertible Notes (assumes full funding of $15,500,000) (i)

PIPE Convertible Notes (assumes full funding of $ 15,500,000 )

Common stock – Series A warrants (assumes full funding of $ 15,500,000 )

Common stock – Series B warrants (assumes full funding of $ 15,500,000 )

Stock Options

PIPE Convertible Notes (1)

Common Stock - Series A warrants

Common stock - Series B warrants

Earnout shares - Earned in three Tranches over three years (assumes achievement of revenue and VWAP targets)

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since the calculation is based on variable floating factors.

Accounting Pronouncements

has evaluated all recent accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) and determined

that none of the pronouncements will have a material impact on our financial statements.

We will continue to monitor the issuance of

any new accounting pronouncements and assess their potential impact on the financial statements in future periods.

Concentration

of Credit and Supplier Risk

instruments that potentially subject the Company to concentration of credit risk consist primarily of cash deposits and trade accounts

Credit risk can be negatively impacted by adverse changes in the economy or by disruptions in the credit markets.

maintain our cash deposits with established commercial banks.

At times, balances may exceed federally insured limits.

We have not experienced

any losses in such accounts and do not believe that we are exposed to any significant credit risk associated with our cash deposits.

believe that credit risk with respect to trade accounts receivable is somewhat mitigated by our large number of geographically diverse

customers and our credit evaluation procedures.

We record trade accounts receivables at sales value and establish specific reserves for

certain customer accounts identified as known collection problems due to insolvency, disputes or other collection issues.

of the specific reserves estimated by management are determined by a loss rate model based on delinquency.

We maintain reserves for potential

There were no customers that accounted for more than 10.0 % of our revenues for the nine months ended September 30, 2024 and 2023.

purchase a significant amount of parts we consume in manufacturing our simulators from nationally known original equipment manufacturers,

many of whom we have had over a 10 to 15 year relationship.

While we do not have long-term contracts, we do issue purchase orders based

on quoted prices terms.

We purchase in the normal course of business approximately 50% of our assembly parts from six to eight manufacturers.

We believe that while there are alternative suppliers, for the parts and equipment, we purchase in each of the principal product categories,

termination of one or more of our relationships with any of our major suppliers of equipment could have a material adverse effect on

our business.

Company has the ability to grant employees a number of different stock-based awards, including restricted shares of common stock, restricted

stock units, stock options, and stock appreciation rights to purchase common stock, under the TruGolf Holdings, Inc.

2024 Incentive Plan

(the “2024 Plan”).

The Company records stock-based compensation expense based on the fair value of stock awards at the grant

date and recognizes the expense over the employees’ service periods.

For performance-based awards, recognition of stock-based compensation

expense also includes management’s estimate of the probability of performance criteria as of the end of each reporting period.

Stock-based compensation expense is recognized net of estimated forfeitures and expense is not recognized for awards that do not vest

if service or performance conditions are not satisfied.

to Accounting Standards Update (“ASU”) 2018-07, Compensation – Stock Compensation (Topic 718):

Improvements to Non-employee

Share-Based Payment Accounting, the Company accounts for stock options issued to non-employees for their services in accordance with

The Company uses valuation methods and assumptions to value the stock options that are in line with the process for valuing

employee stock options noted above.

Growth Company Status

Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of

the JOBS Act until those standards apply to private companies.

The Company has elected to use this extended transition period for complying

with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the

date that it is (i) no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period

provided in the JOBS Act.

As a result, these unaudited condensed consolidated financial statements may not be comparable to companies

that comply with the new or revised accounting pronouncements as of public company effective dates.

The JOBS Act does not preclude an

emerging growth company from early adopting new or revised accounting standards.

The Company expects to use the extended transition period

for any new or revised accounting standards during the period which the Company remains an emerging growth company.

Company currently operates as one business segment, which is also the sole reportable segment, focusing on the manufacturing and sales

of indoor golf simulators.

The Company’s business offerings have similar economic and other characteristics, including the nature

of products, manufacturing, types of customers, and distribution methods.

The determination of a single business segment is consistent

with the unaudited condensed consolidated financial information regularly provided to the Company’s chief operating decision maker

The Company’s CODM is its Principal Executive and Financial Officer and Director, who reviews and evaluates

consolidated profit and loss and total assets for the purpose of assessing performance, making operating decisions, allocating resources,

and planning and forecasting for future periods.

fair value of the warrants is estimated on the date of issuance using the Black-Scholes option pricing model, which requires the input

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Expected volatilities used in the valuation

model are based on the average volatility of the comparable companies publicly traded on recognized stock exchanges.

The risk-free rate

for the expected term of the option is based on the United States Treasury yield curve in effect at the time of the grant.

ACCOUNTS RECEIVABLE, NET

receivable and allowance for doubtful accounts consisted of the following as of September 30, 2024 and December 31, 2023:

OF ALLOWANCE FOR DOUBTFUL ACCOUNTS

model are based on the average volatility of the comparable publicly traded on recognized stock exchanges.

The risk-free rate for the

expected term of the option is based on the United States Treasury yield curve in effect at the time of the grant.

Adopted Accounting Pronouncements

December 2023, the FASB issued Update 2023-09 - Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, which enhances the

disclosure requirements for income tax rate reconciliation, domestic and foreign income taxes paid, and unrecognized tax benefits.

amendments of ASU 2023-09 are effective for annual periods beginning after December 15, 2024.

The Company adopted this new guidance on

January 1, 2025, and the adoption did not have a material effect on the Company’s unaudited condensed consolidated financial statements.

Accounting Pronouncements

January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive

Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective Date ,

which amends ASU 2024-03 to clarify when public business entities (PBEs) and all other entities must begin providing the new expense-disaggregation

ASU 2025-01 does not change the underlying disclosure requirements introduced by

rather, it revises paragraph 220-40-65-1 to state explicitly that the amendments are effective for annual

periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027 .

Early adoption

continues to be permitted.

The Company is currently evaluating the impact of these amendments on its consolidated financial statements

and related disclosures.

3 – ACCOUNTS RECEIVABLE

receivable and allowance for credit losses consisted of the following:

OF ALLOWANCE FOR CREDIT LOSSES

Trade accounts receivable

Accounts receivable

Less allowance for doubtful accounts

Less allowance for credit losses

( 1,424,074 )

( 1,470,868 )

Total accounts receivable, net

receivable are primarily made up of trade receivables due from customers in the ordinary course of business.

In our normal course of

business we have four to five customers that accounted for approximately 50 % of our balance of accounts receivable as of September 30,

2024 and December 31, 2023, respectively.

Total accounts

receivable, net

4 – INVENTORY, NET

following summarizes inventory as of September 30, 2024 and December 31, 2023:

following summarizes inventory:

Inventory - raw materials

1 unchanged sentence

Inventory, net

SHORT-TERM INVESTMENTS

February 2023, we entered into a brokerage agreement and deposited $ 2,500,000 .

In February 2023, we purchased $ 450,751 in corporate fixed

income securities (corporate bonds) and $ 1,981,061 in government securities (Treasury securities).

The Company terminated the brokerage

agreement during the nine months ended September 30, 2024, liquidated the vast majority of its investments and has $ 10,114 on its balance

sheet as of September 30, 2024.

As of December 31, 2023, the marketable securities consisted of the following:

OF MARKETABLE SECURITIES

Corporate fixed income securities, weighted average yield and maturity of 5.39 % and 2.38 years, respectively

Government securities, weighted average yield and maturity of 4.91 % and 3.25 years, respectively

Total short-term investments

classify our short-term investments as available-for-sale securities as we may sell these securities at any time for use in operations

or for other purposes.

We record such securities at fair value on our balance sheet, with unrealized gains or losses reported as a component

of accumulated comprehensive loss.

The amount of unrealized gains or losses reclassified into earnings is based on specific identification

when the securities are sold.

We periodically evaluate if any security has experienced credit-related declines in fair value, which are

recorded against an allowance for credit losses with an offsetting entry to interest and other expense, net on the statement of operations.

As of September 30, 2024, the Company had $ 10,114 of short-term investments in cash and cash equivalents remaining.

OTHER LONG-TERM ASSETS

following summarizes other long-term assets as of September 30, 2024 and December 31, 2023:

OF OTHER LONG TERM ASSETS

Security deposit – Ethos Management loan

Security deposits – leased facilities

Other long-term assets

Total other long-term assets

a condition of funding on the Ethos Management loan, we placed a $ 1,875,000 security deposit as collateral for the note.

loan fees are being amortized over the term of the Ethos Management loan.

Deposits related to the facility leases are generally the last

month’s payments.

Ethos Asset Management Loan Agreement (“Loan Agreement”) stipulates that fundings should happen approximately every 30 banking

days, subject to Ethos completing periodic internal audits to ensure the Company was in compliance with the terms of loan agreement.

Ethos Management informed the Company in August 2023, that unrelated to TruGolf, Ethos Management is currently undergoing a routine audit

of its loan portfolio, and pending the close of the audit, borrowers may experience delays in drawing on funds when requested.

the lack of additional fundings and in accordance with the terms of the Loan Agreement, in February 2024, we sent Ethos a notice of termination

for materially breaching the Loan Agreement.

Based on the termination for default clause in the Loan Agreement, we are entitled to retain

all the funds disbursed by Ethos, and Ethos must release the deposit collateral, which offsets in part the loan payable of $ 2,383,059

(Note 10.) and accrued interest of $ 81,560 as of September 30, 2024.

5 – MARKETABLE INVESTMENT SECURITIES

February 2023, the Company entered into a brokerage agreement and deposited $ 2,500,000 .

In February 2023, the Company purchased $ 450,751

in corporate fixed income securities (corporate bonds) and $ 1,981,061 in government securities (Treasury securities).

The Company terminated

the brokerage agreement during the three months ended December 31, 2024, liquidated the vast majority of its investments and has $ 10,114

recorded in cash and cash equivalents on its unaudited condensed consolidated balance sheet as March 31, 2025 and December 31, 2024,

respectively.

6 – PROPERTY AND EQUIPMENT, NET

following summarizes property and equipment as of September 30, 2024 and December 31, 2023:

following summarizes property and equipment:

OF PROPERTY AND EQUIPMENT

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Furniture and fixtures

Property and equipment,

Property and equipment, gross

Less accumulated depreciation

Property and equipment, net

expense for the nine months ended September 30, 2024 and 2023, was $ 42,753 and $ 35,704 respectively.

following summarizes capitalized software development costs as of September 30, 2024:

Total other long-term assets

Company recorded depreciation expense was $ 15,300 and $ 14,317 for the three months ended March 31, 2025 and 2024, respectively.

following summarizes capitalized software development costs as of March 31, 2025 and December 31, 2024:

OF CAPITALIZED SOFTWARE DEVELOPMENT COSTS

Capitalized software – beginning balance

Capitalized software, net - beginning balance, December 31, 2024

Capitalized software development costs - 2025

Less accumulated amortization

Capitalized software development costs, net

CUSTOMER DEPOSITS

deposits are advance payments from customers prior to manufacturing and shipping a simulator.

The prepayment amounts and timing vary

depending on the product to be manufactured and delivery location.

Customer deposits are included in current liabilities until the balance

is applied to an order at the time of invoicing.

As of September 30, 2024 and December 31, 2023 customer deposits were $ 4,600,105 and

Capitalized software

development costs, net

Company recorded amortization of capitalized software costs of $ 100,000 and $ 18,463 for the three months ended March 31, 2025 and 2024,

respectively.

7 – ACCRUED AND OTHER CURRENT LIABILITIES

and other current liabilities consist of the following amounts:

SCHEDULE OF ACCRUED AND OTHER CURRENT LIABILITIES

Accrued payroll

Warranty reserve

Sales tax payable

Other accrued liabilities

Total accrued and other current liabilities

Accrued liabilities and other current liabilities assumed in Merger:

SCHEDULE OF ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES ASSUMED IN MERGER

Accrued tax payable

Total accrued and other current liabilities assumed in Merger

8 – NOTES PAYABLE

payable consisted of the following as of September 30, 2024 and December 31, 2023:

payable consisted of the following:

SCHEDULE OF NOTES PAYABLE

Note payable – Ethos Management INC

Note payable – Mercedes-Benz

Less deferred loan fees – Ethos Management Inc.

Less current portion

Long-term portion

payable - Ethos Management Inc.

January 2023, we entered into a financing agreement with Ethos Asset Management INC (the “Ethos Asset Management Loan” or

“Ethos”) in the principal amount of up to $ 10 million.

Pursuant to the terms of the Ethos Asset Management Loan, we may draw

down financing proceeds equal to $ 833,333 each month beginning in April 2023, up to the $ 10 million amount.

Interest associated with

the Ethos Asset Management Loan is fixed at 4 % per annum and has a three-year grace period for principal and interest payments.

principal and interest payments will commence in 2027 and continue through 2034.

As a condition to funding, we provided Ethos Management

with a $ 1,875,000 deposit as collateral for the note.

Ethos Management informed the Company in August 2023, that unrelated to TruGolf,

Ethos Management is currently undergoing a routine audit of its loan portfolio, and pending the close of the audit, borrowers may experience

payable - Mercedez-Benz

current portion

payable long-term portion

Management Inc.

January 2023, the Company entered into a financing agreement with Ethos Asset Management Inc.

(the “Ethos Loan” or “Ethos”)

in the principal amount of up to $ 10 million.

Pursuant to the terms of the Ethos Loan, the Company may draw down financing proceeds equal

to $ 833,333 each month beginning in April 2023, up to the $ 10 million amount.

Interest associated with the Ethos Loan is fixed at 4 %

per annum and has a three-year grace period for principal and interest payments.

Annual principal and interest payments will commence

in 2027 and continue through 2034.

As a condition to funding, the Company provided Ethos with a $ 1,875,000 deposit as collateral (the

“Deposit Collateral”) for the note.

Ethos Loan stipulates that fundings should happen approximately every 30 banking days, subject to Ethos completing periodic internal

audits to ensure the Company was in compliance with the terms of the loan agreement.

In August 2023, Ethos informed the Company that

unrelated to the Company, Ethos was undergoing a routine audit of its portfolio, and pending the close of the audit, borrowers may experience

delays in drawing on funds when requested.

Ethos Asset Management Loan Agreement (“Loan Agreement”) stipulates that fundings should happen approximately every 30 banking

days, subject to Ethos completing periodic internal audits to ensure the Company was in compliance with the terms of loan agreement.

Ethos Management informed the Company in August 2023, that unrelated to TruGolf, Ethos Management is currently undergoing a routine audit

of its loan portfolio, and pending the close of the audit, borrowers may experience delays in drawing on funds when requested.

the lack of additional fundings and in accordance with the terms of the Loan Agreement, in February 2024, we sent Ethos a notice of termination

for materially breaching the Loan Agreement.

Based on the termination for default clause in the Loan Agreement, we are entitled to retain

all the funds disbursed by Ethos and Ethos must release the deposit collateral, which is offset in part by the security collateral of

$ 1,875,000 (Note 7.).

The balance of the Ethos liability after offsetting the collateral deposit and accrued interest payable is $ 589,619 ,

which amount is included in ‘Accrued and other current liabilities’ on the balance sheet as of September 30, 2024.

Payable – Mercedes-Benz

November 2020, we entered into a $ 59,545 , 5.90 % annual interest rate note payable with Mercedes-Benz for a delivery van.

The note matures

on November 20, 2026 , and is secured by the van.

We make a monthly payment of $ 908 .

Payable – JP Morgan Chase

June 2021, we entered into a $ 500,000 , 3.00 % annual interest rate note payable with JPMorgan Chase Bank, N.A.

(“JP Morgan”).

The note matures on June 8, 2026 .

We make a monthly principal and interest payment in the amount of $ 8,994 .

There is no prepayment penalty

if the loan is paid prior to the maturity date.

December 2023, we entered into a one-year line of credit facility with JP Morgan.

See Note 11 – Lines of Credit .

The outstanding

note payable balance of $ 257,113 was transferred to the new line of credit.

Payable – assumed in Merger

Company assumed notes payable from the Merger in the amount of $ 1,565,000 , which is comprised of:

(i) an unsecured promissory note in

the principal amount of $ 1,265,000 issued to two affiliates of the Sponsor on October 15, 2022 in connection with the First Extension,

from October 29, 2022 to January 29, 2023;

and (iii) an unsecured promissory note in the principal amount of $ 300,000 issued to an affiliate

of the Sponsor on February 9, 2023 in connection with the Second Extension, from January 29, 2023 to July 29, 2023, pursuant to which

a monthly payment of $ 50,000 had been deposited into the Trust Account after January 29, 2023 for six months.

Pursuant to the fully executed

Promissory Notes, each of the Promissory Notes bears no interest and is due and payable upon the earlier of the consummation of DMA’s

initial business combination or the date of the liquidation of DMA.

As of September 30,2024, the balance of the notes payable assumed

in the Merger was $ 1,465,000 after a payment of $ 100,000 to one on the note holders.

February 2, 2024, the Company executed a securities purchase agreement (the “Purchase Agreement”) with each of the investors

that executed the Prior Loan Agreements, which replaced, in their entirety, the Prior Loan Agreements, and with additional investors

(together, the “PIPE Investors”).

Pursuant to the terms and conditions of the Purchase Agreement, the PIPE Investors agreed

to purchase from the Company (i) senior convertible notes in the aggregate principal amount of up to $ 15,500,000 (the “PIPE Convertible

Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s Class A common stock (the “Series

A Warrants”);

and (iii) Series B warrants to initially purchase 1,550,000 shares of the Company’s Class A common stock (the

“Series B Warrants,” and collectively with the Series A Warrants, the “PIPE Warrants”) (the “PIPE Financing”).

of September 30, 2024, the Company recorded PIPE Convertible Notes payable of $ 4,650,000 and an original issue discount of $ 465,000 resulting

in the net balance of $ 4,185,000 .

As of September 30, 2024, the Company recorded interest expense on the PIPE Convertible Notes of $ 647,047 ,

and interest expense relating to the amortization of the OID of $ 47,447 .

The process for the second tranche of the PIPE Convertible Notes

payable has commenced and should be completed in November 2024.

to satisfying the conditions discussed below, TruGolf Holdings, Inc.

has the right under the Purchase Agreement, but not the obligation,

to require that the PIPE Investors purchase additional Notes at up to two additional closings.

Upon notice at any time after the 2nd

trading day following the Initial Closing Date, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate

principal amount of $ 4,650,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $ 4,185,000 , if (i) the Registration

Statement (as described below) has been filed;

and (ii) certain customary closing conditions are satisfied (the “First Mandatory

Additional Closing”).

Upon notice at any time after the 2nd trading day following the date that the First Mandatory Additional

Closing is consummated, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate principal amount of $ 6,200,000

of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $ 5,580,000 , if (i) the shareholder approval is obtained (as described

(ii) the Registration Statement has been declared effective by the SEC;

and (iii) certain customary closing conditions are satisfied

(the “Second Mandatory Additional Closing”).

addition, pursuant to the Purchase Agreement, as amended by the Waiver (described below) each PIPE Investor has the right, but not the

obligation, to require that, upon notice, TruGolf Holdings sell to such PIPE Investor at one or more additional closings such PIPE Investor’s

pro rata share of up to a maximum aggregate principal amount of $ 10,850,000 in additional PIPE Convertible Notes (each such additional

closing, an “Additional Optional Closing”);

provided that, the principal amount of the additional PIPE Convertible Notes

issued at each Additional Optional Closing must equal at least $ 250,000 .

If a PIPE Investor has not elected to effect an Additional Optional

Closing on or prior to August 30, 2025, such PIPE Investor shall have no further right to effect an Additional Optional Closing under

the Purchase Agreement.

August 13, 2024, the Company entered into those certain waiver and amendment agreements (the “Waiver”), pursuant to

which the Company and the PIPE Investors agreed to:

(i) waive any breaches or defaults caused by the Company’s failure to

timely file its SEC reports through August 14, 2024;

(ii) extend the date by which the Additional Optional Closings may occur until

11 months from the effective date of the initial Registration Statement;

(iii) permit the Company to raise debt financing from its

affiliates through non-convertible, unsecured notes with a maturity date that is later than the maturity date of the PIPE

Convertible Notes;

(iv) waive certain registration failures until September 3, 2024 and permit the issuance of common stock to

satisfy certain registration failures;

and (v) allow the Company to satisfy the interest payments due April 1, 2024, July 1, 2024

and October 1, 2024 from the issuance of common stock or by allowing such amounts to be added to the principal amount of the PIPE

Convertible Notes, at the option of the PIPE Investors.

In addition, certain PIPE Investors agreed to acquire additional PIPE

Convertible Notes without regard to any volume or price requirements in the instruments.

In February 2024, due to the lack of additional fundings and in accordance with the terms

of the Ethos Loan, the Company sent Ethos a notice of termination for materially breaching the Ethos Loan agreement.

Based on the termination

for default clause in the Ethos Loan, the Company was entitled to retain all funds disbursed by Ethos and Ethos must release the Deposit

At the date of the Ethos Loan termination the principal and accrued interest owed on the Ethos Loan was $ 2,383,059 and $ 81,560 ,

respectively.

As a result of the Ethos Loan termination, the outstanding principal and accrued interest was offset by the Deposit Collateral

leaving $ 589,619 , which is included in Accrued and other current liabilities on the unaudited condensed consolidated balance sheets at

March 31, 2025 and December 31, 2024, respectively (See Note 7 – Accrued and Other Current Liabilities ).

Mercedes-Benz

November 2020, the Company entered into a $ 59,545 , 5.90 % annual interest rate note payable with Mercedez-Benz for a delivery van.

note matures on November 20, 2026 , and is secured by the van.

The Company makes a monthly payment of $ 908 , which includes both principal

and interest.

The outstanding principal on the note at March 31, 2025 and December 31, 2024, was $ 17,285 and $ 19,733 , respectively.

Assumed in Merger

a successor to DMAQ, the Company assumed notes payable from the Merger in the amount of $ 1,565,000 , which was comprised of:

(i) an unsecured

promissory note in the aggregate principal amount of $ 1,265,000 issued to two affiliates of the Sponsor on October 15, 2022, in connection

with the First Extensions, from October 29, 2022 to January 29, 2023, and (ii) an unsecured promissory note in the principal amount of

$ 300,000 issued to an affiliate of the Sponsor on February 9, 2023 in connection with the Second Extension, from January 29, 2023, to

July 29, 2023, pursuant to which a monthly payment of $ 50,000 had been deposited in the Trust Account after January 29, 2023 for six

Pursuant to the fully executed Promissory Notes, each of the Promissory Notes bears no interest and is due upon the earlier of

the consummation of DMA’s initial business combination or the date of the liquidation of DMAQ.

During the year ended December 31,

2024, the Company made a principal payment of $ 100,000 to one of the note holders.

December 31, 2024, using the proceeds from the November 7, 2024, funding of additional PIPE Convertible Notes (See Note 9 –

PIPE Convertible Notes ) the Company repaid the remaining balance of such notes in full.

The extinguishment of one of the convertible

notes resulted in extinguishment accounting.

See Note 9 – PIPE Convertible Notes for additional details.

9 – PIPE CONVERTIBLE NOTES

November 2, 2023 and December 7, 2023, DMAQ executed loan agreements with certain accredited investors (together, the “Prior Loan

Agreements”) pursuant to which such investors agreed to loan DMAQ up to an aggregate $ 11 million in exchange for the issuance of

convertible notes and warrants.

On February 2, 2024, the Company executed a securities purchase agreement (the “Purchase Agreement”)

with each of the investors that executed the Prior Loan Agreements, which replaced the Prior Loan Agreements in their entirety, and with

additional investors (together, the “PIPE Investors”).

Pursuant to the terms and conditions of the Purchase Agreement, the

PIPE Investors agreed to purchase from the Company (i) senior convertible notes in the aggregate principal amount of up to $ 15.5 million

(the “PIPE Convertible Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s Class

A common stock (the “Series A Warrants”), and (iii) Series B warrants to initially purchase 1,550,000 shares of the Company’s

Class A common stock (the “Series B Warrants,” and collectively with the Series A Warrants, the “PIPE Warrants”)

(the “PIPE Financing”).

the terms of the Purchase Agreement, the Company had the right, but not the obligation, to require that the PIPE Investors purchase additional

PIPE Convertible Notes at up to two additional closings.

On February 6, 2024, the first additional closing (the “First Mandatory

Additional Closing”) occurred for the sale of $ 4.65 million in additional PIPE Convertible Notes with an Original Issue Discount

of $ 465,000 for gross proceeds of $ 4.185 million, subject to the filing of a registration statement and satisfaction of customary closing

addition, pursuant to the Purchase Agreement, as amended, each PIPE Investor had the right, but not obligation, to require the

Company to sell to such investor its pro rata share of up to an aggregate principal amount of $ 10.85

million of additional PIPE Convertible Notes in one or more “Additional Optional Closings,” provided that the principal

amount issued in each such closing is no less than $ 250,000 .

These optional rights expire on August 30, 2025.

August 13, 2024, the Company entered into waiver and amendment agreements (the “Waiver”) with the PIPE Investors.

Waiver, the parties agreed to, among other things:

to (i) waive any defaults caused by the Company’s failure to timely file SEC

reports through August 14, 2024, (ii) extend the deadline for Additional Optional Closings to 11 months following the effectiveness of

the initial registration statement, (iii) permit the Company to raise non-convertible, unsecured debt financing from its affiliates,

(iv) waive certain registration failures through September 3, 2024, and allow such failures to be cured through the issuance of common

stock, and (v) allow interest payments due April 1, July 1, and October 1, 2024, to be paid in shares of common stock or added to the

principal of the PIPE Convertible Notes, at the election of the applicable PIPE Investor.

In connection with the Waiver, the Company

issued an aggregate of 192,151 shares

in satisfaction of certain registration statement delay payments and issued an aggregate of 157,582 shares

in satisfaction of outstanding interest payments.

Such payments were made at the “Alternate Conversion Price” set forth

in the PIPE Convertible Notes, which is equal to the lesser of (i) the Conversion Price, and (ii) 90% of the lowest volume weighted

average price of the Class A common stock during the five consecutive trading days immediately prior to such conversion.

November 7, 2024, the Company entered into those certain amendments to the Waivers (the “Amendments”), pursuant to which

the Company and the PIPE Investors agreed to:

(i) waive any breaches or defaults caused by the Company’s failure to timely

file its SEC reports through August 21, 2024;

and (ii) waive certain registration failures until October 3, 2024.

In addition, the

PIPE Investors waived any breaches or defaults that may have occurred or will occur solely as a result of the Company’s

failure to comply with the continued listing requirements of the Nasdaq Stock Market due to:

(i) the Company’s failure to meet

the stockholders’ equity requirement for continued listing, provided that the foregoing waiver shall expire on January 15,

2025, (ii) the Company’s failure to meet the market value of publicly held shares requirement for continued listing, provided

that the foregoing waiver shall expire on January 15, 2025, and/or (iii) the Company’s failure to meet the minimum bid price

requirement for continued listing;

provided that the foregoing waiver shall expire on January 15, 2025, provided further that to the

extent the Company is in compliance with all other Nasdaq Stock Market listing requirements and has filed a preliminary proxy

statement to hold a special meeting to vote on a reverse stock split to remedy the bid price failure, the waiver shall be extended

to March 15, 2025.

In connection with the Amendment, the Company issued an aggregate of 116,959 shares

in satisfaction of certain registration statement delay payments and issued an aggregate of 65,790 shares

in satisfaction of outstanding interest payments.

Such payments were made at the “Alternate Conversion Price” set forth

in the PIPE Convertible Notes, which is equal to the lesser of (i) the Conversion Price, and (ii) 90% of the lowest volume weighted

average price of the Class A common stock during the five consecutive trading days immediately prior to such conversion.

November 7, 2024, certain PIPE Investors agreed to purchase additional PIPE Convertible Notes in aggregate principal amount of $ 3,300,000

for aggregate proceeds of $ 2,970,000 .

In connection with the foregoing, the Company agreed to repay an aggregate of $ 2,496,686 in outstanding

debt and transaction expenses.

issued 192,151 shares of Class A common stock to satisfy registration delay penalties and 157,582 shares of Class A common stock to satisfy

accrued interest obligations.

These issuances were made at the “Alternate Conversion Price” set forth in the PIPE Convertible

Notes, which is defined as the lesser of the fixed conversion price or 90% of the lowest volume weighted average price (VWAP) of the

Company’s Class A common stock over the five consecutive days prior to conversion.

Additionally, the Company issued 190,586 shares

to a PIPE Investor as a result of language in the PIPE Convertible Note related to ownership percentage prior to the Merger.

7, 2024, the Company and certain PIPE Investors entered into further amendments to the Waiver (the “Amendments”) under which

the PIPE Investors agreed to waive any breaches or defaults resulting from the Company’s failure to timely file SEC reports through

August 21, 2024, and extended the waiver for certain registration failures through October 3, 2024.

The PIPE Investors also waived defaults

related to the Company’s non-compliance with the continued listing requirements of the Nasdaq Stock Market, including (i) failure

to meet the minimum stockholders’ equity threshold, (ii) failure to meet the minimum market value of publicly held shares, and (iii)

failure to meet the minimum bid price requirement.

These waivers are effective through January 15, 2025, but may be extended through March

15, 2025, solely with respect to the bid price deficiency, provided the Company remains in compliance with all other listing requirement

and files a preliminary proxy statement to seek shareholder approval of a reverse stock split.

In connection with these Amendments, the

Company issued 116,959 shares of Class A common stock to satisfy additional registration delay penalties and 65,790 shares of Class A

common stock for unpaid interest, also at the Alternate Conversion Price.

November 7, 2024, certain PIPE Investors agreed to purchase an additional $ 3.3 million in principal amount of PIPE Convertible Notes with

an Original Issue Discount of $ 330,000 for gross proceeds of $ 2.97 million.

The Company used approximately $ 2.5 million of the proceeds

from this issuance to repay outstanding debt and cover related transaction expenses.

of the PIPE Notes issued on November 7, 2024 was purchased in exchange for a convertible note payable and an unsecured note payable

that were previously issued to the same PIPE Investor.

The exchange resulted in debt extinguishment accounting as the present value

of the future cash flows of the new PIPE Convertible Note was greater than 10% of the remaining present value of the cash flows of

the exchanged notes.

As a result, the Company recorded a loss on extinguishment of debt of $ 270,594

on the consolidated statements of operations for the year ended December 31, 2024.

16, 2024, a certain PIPE Investor agreed to purchase an additional $ 2.1 million in the principal amount of a PIPE Convertible Note with

an Original Issue Discount of $ 210,000 for gross proceeds of $ 1.89 million.

8, 2025, certain PIPE Investors agreed to purchase an additional $ 2.8 million in principal amount of PIPE Convertible Notes with an Original

Issue Discount of $ 280,000 for gross proceeds of $ 2.52 million.

the three months ended March 31, 2025, the Company converted an aggregate principal amount of $ 1,655,000 and $ 1,087,513 in accrued and

make-whole interest related to the PIPE Convertible Notes into 3,064,420 shares of the Company’s Class A common stock.

PIPE Convertible

Notes payable consisted of the following:

OF PIPE CONVERTIBLE NOTES PAYABLE

PIPE Convertible Note Balance at January 1, 2024

PIPE Convertible Notes issued

Debt Discount associated with OID and Warrants

( 1,147,319 )

PIPE Convertible Notes, net

Gross PIPE Convertible Note principal converted into Class A common stock

( 5,832,600 )

Accretion of debt discount

Total PIPE Convertible Notes, net at December 31, 2024

PIPE Convertible Notes issued

Debt Discount associated with OID

PIPE Convertible Notes, net

Gross PIPE Convertible Note principal converted into Class A common stock

( 1,655,000 )

Accretion of debt discount

Total PIPE Convertible Notes, net at March 31, 2025

the three months ended March 31, 2025 and 2024, amortization expense related to the Debt Discount of the PIPE Convertible Notes was $ 231,940

and $ 3,325 , respectively.

The principal balance of the PIPE Convertible Notes, net of Debt Discounts, and accrued interest related to

the PIPE Convertible Notes at March 31, 2025, was $ 5,165,893 and $ 0 , respectively.

The principal balance net of Debt Discounts and accrued

interest related to the PIPE Convertible Notes at December 31, 2024, was $ 4,068,953 and $ 154,500 , respectively.

NOTE 10 – RELATED PARTY

NOTES AND LOANS PAYABLE

Related party notes payable

party notes payable consisted of the following as of September 30, 2024 and December 31, 2023:

OF RELATED PARTY NOTES PAYABLE

Notes payable - ARJ Trust

consisted of the following:

SCHEDULE OF RELATED PARTY NOTES PAYABLE

Note payable - ARJ Trust

Note payable - McKettrick

Note payable - Carver

Loan - Chris Jones

Notes payable

2 unchanged sentences

( 2,937,000 )

Long-term portion

maturities of related party notes payable are as follows as of September 30, 2024:

OF FUTURE MATURITIES OF RELATED PARTY NOTES PAYABLE

2024 (three months)

Payable – ARJ Trust

December 2008, we entered into a $ 500,000 , 8.50 % annual interest rate note payable with a trust (“ARJ Trust”) indirectly

controlled by the chief executive officer.

We make monthly interest-only payments of $ 3,541 .

As of September 30, 2024 and December 31,

2023, the principal balance was $ 500,000 .

June 2010, we entered into a second $ 150,000 , 8.50 % annual interest rate note payable with the ARJ Trust.

We make monthly interest-only

payments of $ 1,063 .

As of September 30, 2024 and December 31, 2023, the principal balance outstanding was $ 150,000 .

of September 30, 2024 and December 31, 2023, the principal balance outstanding was $ 650,000 and accrued interest was $ 4,604 .

was to mature on March 31, 2024 and was extended to March 31, 2025 .

trustee of the ARJ Trust is a related party to the Company’s chief executive officer.

Payable – McKettrick

May 2019, we entered into a $ 1,750,000 , zero interest rate note payable with a former shareholder to repurchase all shares in the Company.

The note is payable in annual installments of $ 250,000 due on December 21 of each year.

Note payable long-term portion

Future maturities of related

party notes and loan payables as of March 31, 2025:

SCHEDULE OF FUTURE MATURITIES OF RELATED PARTY NOTES PAYABLE

In December 2008, the Company

entered into a note payable with ARJ Trust, a trust that is indirectly controlled by the Company’s chief executive officer.

note has a principal amount of $ 500,000 , an interest rate of 8.50 % per annum, and a maturity date of March 31, 2024.

The Company is required

to make monthly interest-only payments of $ 3,541 .

In June 2010, the Company entered

into a second note payable with ARJ Trust.

The note has a principal amount of $ 150,000 , an interest rate of 8.50 % per annum, and a maturity

date of March 31, 2024.

The Company is required to make monthly interest-only payments of $ 1,063 .

31, 2024 , the maturity date of the notes was extended to March

On March 31, 2025, the maturity date of the notes was extended to September

The Company made interest-only

payments of $ 13,812 and $ 10,901 during the three months ended March 31, 2025 and 2024, respectively.

The principal balance of the notes

was $ 650,000 at both March 31, 2025 and December 31, 2024.

In May 2019, the Company entered

into a $ 1,750,000 , zero interest rate note payable with a former shareholder to repurchase all their owned shares in the Company.

note is payable in annual installments of $ 250,000 due on December 21 of each year.

The note matures on December 1, 2027 .

a late fee of 5%, if not paid within 10 days of the due date .

During the nine months ended September 30, 2024, the Company paid the December

2023 installment of $ 250,000 and $ 50,000 in negotiated extension fee.

The balance of the note payable at September 30, 2024 and December

31, 2023 was $ 1,050,000 and $ 1,300,000 , respectively.

Payable – Carver

January 2021, we entered into a $ 222,000 , zero interest rate note payable with a former shareholder to repurchase all shares in the Company.

If the annual

installment is not paid within 10 days of the due date a late fee of 5% is charged.

During the year ended December 31, 2024, the Company

paid the December 2024 and 2023 installments totaling $ 500,000 and $ 50,000 in a negotiated extension fee for the 2023 installment.

principal balance of the note payable was $ 800,000 at both March 31, 2025 and December 31, 2024.

In January 2021, the Company

entered into a $ 222,000 , zero interest rate note payable with a former shareholder to repurchase all their owned shares in the Company.

The note is payable in semi-annual installments of $ 18,500 due on March 31 and September 30 each year and matures on October 1, 2027 .

The Company paid $ 18,500 on the note on March 31, 2024 and September 30, 2024.

The balance of the note payable as of September 30, 2024

and December 31, 2023 was $ 111,000 and $ 148,000 , respectively.

LINES OF CREDIT

December 2023, we entered into a $ 2,000,000 variable rate line of credit with JP Morgan Chase Bank, N.A.

The purpose of the new line

of credit was to consolidate the balances outstanding on the note payable and the previous line of credit, which had matured.

of credit matures on December 31, 2024.

The line of credit has an annual interest rate computed at the Adjusted SOFR (Secured Overnight

Financing Rate) Rate and at a rate of 3.00 % above the SOFR Rate.

The Adjusted SOFR rate means the sum of the Applicable margin ( 3.50 %

per annum) plus the SOFR rate applicable to the interest period plus the Unsecured to Secured Rate Adjustment.

line of credit was secured by a pledge of $ 2,100,000 in the Company’s deposit accounts (restricted cash) at JP Morgan Chase.

of September 30, 2024 and December 31, 2023, the balance outstanding on the line of credit was $ 802,738 .

February 2023, the Company entered into a variable rate line of credit with Morgan Stanley which is secured by the marketable securities

held in our brokerage account.

As of September 30, 2024 and December 31, 2023, the balance outstanding was $ 10,114 and $ 1,980,937 , at

a rate of 7.21 %, respectively, as the Company paid off the majority of the line of credit during the three months ended March 31, 2024.

CONVERTIBLE NOTES PAYABLE

May 2022, we entered into two separate but identical $ 300,000 (total $ 600,000 ), 10.00 % annual interest rate convertible notes payable

(“Convertible Notes”) with two individual consultants (“Note Holder”) to assist with services including an initial

public offering preparation and listing to NASDAQ or other national exchange, assist the Company and its counsel in preparing a code

of conduct and employment agreements, franchise development, and valuation increase through growth among other services.

terms of each note include a 15 % original issue discount (“OID”), 292 warrants, no prepayment penalty and a maturity of February

warrants are exercisable at $ 4,800 per share for five years and a cashless option and a mandatory exercise over $ 9,600 with no prepayment

The warrants are non-exercisable for one year from issuance.

The valuation assumptions used in the Black-Sholes model to determine

the fair value of each warrant awarded in 2022:

expected stock price volatility ranged from 40.06 % to 80.17 %;

expected term in years

5.00 with a discount for the one-year lockout period;

and risk-free interest rate 2.95 %.

Note Holder has the right, at any time on or after the issuance date and prior to the maturity date, to convert all or any portion of

the then outstanding and unpaid principal plus any accrued interest thereon into shares of the Company’s common stock.

share conversion price will be convertible into shares of common stock equal to 70 % multiplied by the lower of (i) the volume weighted

average of the closing sales price of the common stock on the date that the Company’s listing on the NASDAQ Global Market or other

national exchange (“Uplisting”) is successfully consummated or (ii) the lowest closing price for the five trading days following

the date of Uplisting, not including the Uplisting day.

the event the Company (i) makes a public announcement that it intends to be acquired by, consolidate or merge with any other corporation

or entity (other than a merger in which the Company is the surviving or continuing corporation and its capital stock is unchanged) or

sell or transfer all or substantially all of the assets of the Company;

or (ii) any person, group or entity (including the Company) publicly

announces a tender offer to purchase 50 % or more of the common stock, then the conversion price will be equal to the lower of the conversion

price and a 25% discount to the announced acquisition provided, that, the conversion will never be less than a price that is the lower

of (iii) the closing price (as reflected on Nasdaq.com) immediately preceding the signing of these notes;

or (iv) the average closing

price of the Company’s common stock (as reflected on Nasdaq.com) for the five trading days immediately preceding the signing of

2022 and at the time off issuance, the Company elected to follow the relative fair value method to allocate the proceeds to the warrants,

OID, and convertible notes (collectively the “Financial Instruments”).

Total estimated fair value of the Financial Instruments

was $ 1,387,060 .

The pro-rata allocation of the $ 450,000 total proceeds was $ 282,109 to the warrants, $ 21,899 to the OID and $ 145,992

to the convertible notes.

The fair value of the warrants exceeded the pro-rata allocation of proceeds to the warrants and the convertible

notes by $ 445,032 , which the Company recorded as interest expense at the time of issuance.

on an estimated 70% discounted conversion price, the Company recorded $ 192,857 in interest expense and a corresponding increase in the

The Company has not made the required installments totaling $ 18,500 for the three months ended March 31, 2025 and $ 37,000 for the year

ended December 31, 2024.

The principal balance of the note payable was $ 111,000 at both March 31, 2025 and December 31, 2024.

During the year ended December

31, 2024, the Company chief executive officer loaned the Company an aggregate of $ 2 million for operating expenses.

The loaned amount

has a zero interest rate and no stated maturity date.

The Company made no payments towards the loan during the three months ended March

31, 2025, however, the Company expects to pay back the loan in full.

The principal balance of the loan payable was $ 2,000,000 at March

31, 2025 and December 31, 2024.

NOTE 11 – LINES OF

JPMorgan Chase

In December 2023, the Company

entered into a $ 2,000,000 variable rate line of credit with JPMorgan.

The purpose of the new line of credit was to consolidate the balances

outstanding on the note payable and the previous line of credit, which had matured.

The line of credit matured on December 31, 2024.

line of credit had an annual interest rate of the Adjusted SOFR (Secured Overnight Financing Rate) Rate plus 3.00 %.

On January 1, 2025, the maturity date of the line of credit was extended

to December 31, 2025.

Upon the maturity date extension the annual interest rate was increased to the Adjusted SOFR Rate plus 3.50 %.

The line of credit is secured

by a pledge of $ 2,100,000 in the Company’s deposit accounts (restricted cash) at JPMorgan.

The outstanding principal balance on

the line of credit was $ 802,738 at March 31, 2025 and December 31, 2024.

Morgan Stanley

During February 2023, the Company

entered into a variable rate line of credit with Morgan Stanley which was secured by the marketable securities held in our brokerage account

(See Note 5 – Marketable Investment Securities ).

The Company terminated the brokerage agreement during the year ended December

31, 2024, liquidated the vast majority of its investments and has $ 10,114 recorded in cash and cash equivalents on its unaudited condensed

consolidated balance sheet as of March 31, 2025 and December 31, 2024.

NOTE 12 – DIVIDEND

NOTES PAYABLE

The Company has elected to account for the convertible notes at fair market value.

The fair market value will be adjusted

at each reporting period.

The total outstanding balance for each convertible note as of December 31, 2022, was $ 225,000 (total $ 450,000 )

and accrued interest was $ 16,480 .

In March 2023, we extended each note’s maturity to July 31, 2023 and increased each note’s

borrowing limit to $ 375,000 .

July 2023, the Company and Convertible Note Holders entered into Warrant Cancellation Agreements, whereby the warrants were cancelled

when the Merger (business combination) with Deep Medicine Acquisition Corp.

was completed.

Also in July 2023, the convertible notes were

modified whereby the maturity date was extended by up to an additional eight months (February 29, 2024), to be in two extensions of four

Five days prior to the extension deadline the Company was to issue 9,000 shares (total 18,000 shares if the Company elects

the two extensions) of the Company’s stock.

The Company did elect the extension.

The Company has not issued the shares as of the

date of this filing.

was zero OID related to the Convertible Notes remaining as of September 30, 2024 and December 31, 2023, and there was no OID interest

expense or amortization recorded during the nine months ended September 30, 2024 and 2023.

of September 30, 2024 and December 31, 2023, the balance of the Convertible Notes was $ 954,622 .

The Convertible Notes were paid off in

connection with the November 7, 2024, funding of the additional PIPE Convertible Notes referenced in Note 11.

DIVIDEND NOTES PAYABLE

to the merger, we filed our tax returns as an S Corporation.

Historically, all income tax liabilities and benefits of the Company are

passed through to the shareholders annually through distributions.

Prior to the Merger, TruGolf

Nevada filed its tax returns as an S Corporation.

Historically, all income tax liabilities and benefits of TruGolf Nevada are passed through

to the shareholders annually through distributions.

No dividends were declared during 2023 or 2022.

During 2021, the Board

of Directors declared $ 7,395,694 in dividends to the shareholders, payable in cash as the Company’s liquidity allows.

the Company paid the shareholders $ 1,965,706 .

In November 2022, each shareholder agreed to defer the accrued dividends payable by entering

into 6.00 % interest rate dividend notes payable.

All outstanding and accrued interest is due and payable when the dividend notes payable

mature on December 31, 2025.

During 2021, the Board of Directors

declared $ 7,395,694 in dividends to the shareholders, payable in cash as the Company’s liquidity allows.

During 2022, TruGolf Nevada

paid the shareholders an aggregate amount of $ 1,965,706 .

In November 2022, each shareholder agreed to defer the accrued dividends payable

by entering into 6.00 % interest rate dividend notes payable.

All outstanding and accrued interest is due and payable when the dividend

notes payable mature on December 31, 2025.

Interest commenced accruing on January 1, 2023.

declared, distributed, and accrued are as follows as of September 30, 2024 and December 31, 32023:

Dividends declared, distributed,

and accrued are as follows:

SCHEDULE OF DIVIDENDS DECLARED, DISTRIBUTED, AND ACCRUED

1 unchanged sentence

Dividends payable

GROSS SALES ROYALTY PAYABLE

June 2015, we entered into a Royalty Purchase Agreement (the “Agreement”) with a purchaser (“Purchaser”) for

a gross sales royalty.

NOTE 13 – GROSS SALES

ROYALTY PAYABLE

In June 2015, the Company entered

into a Royalty Purchase Agreement (the “Royalty Agreement”) with a purchaser (“Purchaser”) for a gross sales royalty.

The Purchaser agreed to purchase a sales royalty for the sum of $ 1,000,000 plus applicable taxes.

agreement the Purchaser may purchase one or more additional royalties in an aggregate amount of up to $ 1,000,000 .

For the period June

2015 through May 2017, the Company paid a monthly payment of $ 20,833 .

Effective June 1, 2017 and all subsequent months, the monthly royalty

payment has been equal to the greater of $ 20,833 plus the amount determined in accordance with the following and of June 1, 2017:

the trailing twelve-month revenue of the Company is equal to or less than $ 6,110,000 , 3.60 % of our monthly revenues, in perpetuity

(unless terminated in accordance with the Purchase Agreement);

trailing twelve-month revenue of the Company is equal to or greater than $ 17,200,000 , 1.30 % of our monthly revenues, in perpetuity

(unless terminated in accordance with the Purchase Agreement);

trailing twelve-month revenue of the Company is greater than $ 6,110,000 but less than $ 17,200,000 , such percentage of monthly revenue

determined by dividing $ 220,060 by the amount of trailing twelve-month revenue and multiplying the result by 100, in perpetuity (unless

terminated in accordance with the Purchase Agreement).

royalty percentage was fixed at 3.6 % based on the trailing twelve-month revenue at the time of executing the Agreement (June 15, 2015).

On June 1, 2017, the royalty percentage was changed to 2.4 % based on the trailing 12-month revenues at that time as outlined in the table

Agreement contains an option for a one-time buy down of the royalty rate.

At any time following the date on which the Purchaser has received

royalty payments that are, in the aggregate, equal to two times the then applicable Aggregate Installment Amount ($ 1,000,000 ), we may

purchase and extinguish 75 % (but no more nor less) of all amounts owing or to become owing to the Purchaser hereunder.

In the event we

want to exercise the buy down option, we would pay the Purchaser $ 750,000 ( 75 % of the $ 1,000,000 outstanding amount).

The adjusted royalty

rate going forward would then be 0.6 % ( 75 % of the 2.4 %).

Agreement also contains an option for a buyout upon the change of control.

If pursuant to a proposed change of control the acquirer under

such transaction requires, as a condition to the completion of such transaction, that the Company purchase and extinguish all amounts

owing or to become owing to the Purchaser hereunder, the Company will pay the greater of:

amount equal to two times the aggregate installment amount as at the date of the change of control buyout notice;

amount equal to A multiplied by B multiplied by C, where:

is equal to the aggregate installment amount as at the date of the change of control divided by $ 22,500,000 ;

is equal to 0.8;

is equal to the net equity value of the Company;

or in the case of a proposed asset sale, the proposed net purchase price of all

or substantially all of the Company’s assets.

Agreement has neither a stated maturity nor an interest rate.

While the royalty percentage can be reduced via a buydown, as previously

explained, the only avenue for terminating the Agreement is a buyout required by an acquirer in a change of control transaction.

the change of control, the Agreement will survive in perpetuity at a royalty rate of 2.4 % or 0.6 % depending on whether or not the royalty

rate buydown option has been exercised.

the gross sales royalty payable has no stated fixed interest nor maturity, it is considered variable interest perpetual debt.

variable payments to the Purchaser are recorded in interest expense.

As of September 30, 2024 and December 31, 2023, the outstanding

amount was $ 1,000,000 .

During the nine months ended September 30, 2024 and 2023, we incurred $ 295,809 and $ 402,816 , respectively, in interest expense

to the Purchaser.

ACCRUED AND OTHER CURRENT LIABILITIES

and other current liabilities consisted of the following as of September 30, 2024 and December 31, 2023:

OF ACCRUED AND OTHER CURRENT LIABILITIES

Accrued payroll

Warranty reserve

Sales tax payable

Accrued and other current liabilities

liabilities and other current liabilities assumed in Merger

LIABILITIES AND OTHER CURRENT LIABILITIES ASSUMED IN MERGER

Accrued tax payable

Other current liabilities assumed in Merger

Accrued liabilities and other current liabilities assumed in Merger

STOCKHOLDERS’ EQUITY

Company has authorized preferred stock of 10,000,000 shares, par value of $ 0.0001 .

As of September 30, 2024 and December 31, 2023, there

were no shares of preferred stock issued and outstanding.

Stock – Series A

Company has authorized common stock – Series A of 90,000,000 shares, par value of $ 0.0001 .

As of September 30, 2024, there were

11,887,985 shares of common stock – Series A and 1,716,860 shares of common stock – Series B issued and outstanding.

Company issued 349,733 shares of common stock – Series A for interest payment to the PIPE Convertible Note Holders during the nine

months ended September 30, 2024.The summary of exchanged and issued shares of common stock – Series A and B resulting from the

Merger follows:

closing of the Business Combination, shares of TruGolf Nevada common stock outstanding include the following:

OF COMMON STOCK

Accrual Redemptions

TruGolf Nevada shareholders – Series A

TruGolf Nevada shareholders – Series B

Private Placement Investors (2)

DMAQ Public stockholders (3)

DMAQ Directors and officers

DMAQ Sponsor (4)

I-Bankers (5)

on 13,098 TruGolf Nevada ordinary shares outstanding immediately prior to the closing of the Business Combination, the Exchange Ratio

determined in accordance with the terms of the Merger Agreement is approximately 570.10 .

New TruGolf issued 7,467,134 shares of New TruGolf

common stock to legacy TruGolf Nevada shareholders in the Business Combination, determined as follows:

SCHEDULE OF BUSINESS ACQUISITION

CONTINGENT CONSIDERATION DETERMINED

TruGolf Nevada

shares outstanding

as of immediately

prior to the Closing

Ordinary shares, par value $ 0.01 per share

Exchange Ratio

Shares of New TruGolf common stock issued to TruGolf Nevada shareholders upon Closing

shares issued to legacy TruGolf Nevada shareholders consists of 5,750,274 shares of New TruGolf Class A common stock and 1,716,860 shares

of New TruGolf Class B common stock.

DMAQ’s Insiders had an aggregate of 406,500 units, which contain 406,500 Private Placement Shares and 406,500 Private Rights.

had an aggregate of 113,000 units, which contain 113,000 Private Placement Shares and 113,000 Private Rights.

Each holder of a private

right received one-tenth (1/10) of one share of DMAQ Class A common stock upon consummation of initial business combination.

placement shares were the shares of DMAQ Class A common stock .

The 519,500 shares of DMAQ Class A common stock and 519,500 Private Right

were exchanged for a total of 571,450 shares of New TruGolf common stock upon the closing of the Business Combination.

Prior to and in connection with the approval of the Business Combination, holders of 378,744 DMAQ Class A Shares properly exercised their

right to have such shares redeemed for a full pro rata portion of the trust account holding the proceeds from the IPO.

In addition, in

connection with the January 26, 2024 meeting to amend certain provisions of DMA’s corporate documents allowing DMAQ to extend its

existence, an additional 943 shares were redeemed, resulting in actual redemptions of 379,687 shares out of the total 574,764 shares

of DMAQ common stock subject to redemption.

Upon the closing of the Business Combination, 1,265,000 shares of New TruGolf Class A common

stock were issued upon the conversion of 12,650,000 public rights.

In connection with the Business Combination, 3,162,500 shares of DMAQ Class A common stock held by the Sponsor and its affiliates were

converted into 3,162,500 shares of New TruGolf Class A common stock.

Reflects the payment of transaction fee pursuant to the BCMA Amendment due at Closing, which was paid to I-Bankers a transaction fee

equal to (i) $ 2,000,000 in cash and (ii) 212,752 New TruGolf Class A Common Shares, and an aggregate of 101,200 Representative Shares

issued in connection with the IPO were exchanged to New TruGolf common stock upon the closing of the Business Combination.

March 2023, the Board of Directors authorized the issuance of 821 shares of common stock to the consultants for the services performed

related as outlined in the services agreements.

The common shares were issued at fair value and $ 4,493,333 was expensed to consulting

April 2022, we secured the services of two consultants (also the Note Holders as described in Note 12 – Convertible Notes Payable )

to assist with services including assisting the Company’s and its counsel in an initial public offering preparation and listing

to NASDAQ or other national exchange, assist the Company and its counsel in preparing a code of conduct and employment agreements, franchise

development, and valuation increase through growth among other services.

services are performed, the first consultant will be provided a 3% stock grant;

while the second consultant will be provided up to 7%

of stock based on performance deliverables including:

1.75% on consummation of an initial bridge loan agreement, 1.75% on engaging an

investment banker, 1.75% upon filing an S-1 including financial statements and footnotes, and 1.75% upon the closing of an initial public

The second consultant will be provided warrants at a 20% discount to the then current price per share, for up to 2% for achieving

a $250 million valuation and 3% more for a $500 million valuation, as well as another 2% for opening the first franchise location, and

3% more once 100 franchise locations have been sold.

As of the date of this filing, no stock grants or awards have been issued .

Stock – Series B

Company has authorized common stock – Series B of 10,000,000 shares, par value of $ 0.0001 .

As of September 30, 2024, there were

1,716,860 shares of common stock – Series B issued and outstanding.

The common stock – Series B has voting rights of 25 votes

per common stock – Series A held.

As of September 30, 2024, three TruGolf insiders own 100 % of the 1,716,680 common stock –

- Common stock – Series A and B

of September 30, 2024, the Company issued warrants to purchase 1,409,091 shares of the Company’s common stock – Series A

to the PIPE Convertible Notes holders with an initial exercise price of $ 13 per share and a term of five years commencing February 1,

The maximum Series A Warrants to be issued for all tranches of the PIPE Convertible Notes is 1,409,091 .

The value of the Series

A Warrants was estimated to be approximately $ 2,268,637 (or $ 1.61 per warrant) using the Black-Scholes option-pricing model as of the

grant date (February 24, 2024) based on the following assumptions:

expected volatility of 227.52 %;

risk-free interest rate of 3.99 %;

expected life of five years .

of September 30, 2024, the Company issued warrants to purchase 3,875,000 shares of the Company’s common stock – Series B

to the PIPE Convertible Notes holders with an initial exercise price of $ 10 per share and a term of thirty months commencing February

The maximum Series B Warrants to be issued for all tranches of the PIPE Convertible Notes is 1,550,000 .

The value of the Series

B Warrants was estimated to be approximately $ 5,347,500 (or $ 1.38 per warrant) using the Black-Scholes option-pricing model as of the

grant date (February 24, 2024) based on the following assumptions:

expected volatility of 227.52 %;

risk-free interest rate of 3.99 %;

expected life of thirty months .

have adopted the provisions of ASC 740-10-25, which provide recognition criteria and a related measurement model for uncertain tax positions

taken or expected to be taken in income tax returns.

ASC 740-10-25 requires that a position taken or expected to be taken in a tax return

be recognized in the financial statements when it is more likely than not that the position would be sustained upon examination by tax

positions that meet the more likely than not threshold are then measured using a probability weighted approach recognizing the largest

amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement .

The Company had no tax positions relating

to open income tax returns that were considered to be uncertain as of September 30, 2024.

to the merger, the Company was an S Corporation for federal and state income tax purposes with all income tax liabilities and/or benefits

of the Company being passed through to the stockholders.

As such, no recognition of federal or state income taxes for the Company has

been provided for prior to January 31, 2024, the date of the consummation of the Merger.

Company incurred a net loss for the nine months ended September 30, 2024 of $ 2,931,370 , which is available to reduce future taxable income

for federal and state income taxes, respectively.

The NOL can be carried forward indefinitely and can be used to offset 80% of future

taxable income.

At the current federal tax rate of 21 % and including book to tax differences result in the current tax benefit NOL of

approximately $ 615,000 at September 30, 2024.

The Company has no income tax effect due to the recognition of a full valuation allowance

on the expected tax benefits of future loss carry forwards based on uncertainty surrounding realization of such assets.

During the nine

months ended September 30, 2024, the Company increased the valuation allowance from $ 0 to $ 615,000 .

COMMITMENTS AND CONTINGENCIES

of September 30, 2024, we had two operating leases as follows:

June 2023, we entered into a five -year lease on the warehouse in North Salt Lake City, Utah.

The base monthly lease payment through

May 2024 is $ 10,849 , $ 11,163 through May 2025, $ 11,486 through May 2026, $ 11,819 through May 2027, and $ 12,162 through May 2028.

As of September 30, 2024, we had 44 months remaining on the lease.

December 2022, we entered into a three -year lease on the corporate headquarters in Centerville, Utah.

The base monthly lease payment

through November 2023 is $ 20,343 , $ 20,378 through November 2023 and $ 24,616 through November 2025.

As of September 30, 2024, we had

33 months remaining on the lease.

utilize our incremental borrowing rate in determining the present value of lease payments unless the implicit rate is readily determinable.

For 2023 and 2022, we used an estimated incremental borrowing rate of 10.00 % and 5.90 % respectively, to determine the present value of

the lease liability.

information related to our operating leases is as follows:

of use asset:

SCHEDULE OF RIGHT OF USE ASSET

As of December 31, 2023

As of March 31, 2024

As of June 30, 2024

As of September 30, 2024

SCHEDULE OF LEASE LIABILITY

Lease liability – December 31, 2023

As of March 31, 2024

As of June 30, 2024

As of September 30, 2024

table below reconciles the fixed component of the undiscounted cash flows for each of five years to the lease liabilities recorded on

the Balance Sheet as of September 30, 2024:

SCHEDULE OF MATURITY LEASE LIABILITY

Minimum Lease

2024 – (Three Months)

Less interest

Present value of future minimum lease payments

Less current portion

Long term lease liability

RELATED PARTY

described in Note 14 – Dividend Notes Payable , the following were outstanding on the dividend notes payable to our officers

and shareholders as of September 30, 2024 and December 31, 2023:

SCHEDULE OF DIVIDEND NOTES PAYABLE

Chief executive officer, Director and Shareholder

Chief hardware officer, Director and Shareholder

Executive vice president, Director and Shareholder

Interim chief financial officer, Director and Shareholder

Company’s chief executive officer is related to certain lenders of the Company as discussed in Note 12 – Related Party

Notes Payable .

Company’s chief executive officer paid $ 500,000 to purchase franchise regions from TruGolf Links Franchising, LLC during the three

months ended June 30, 2024.

the three months ended September 30, 2024, the Company’s chief executive officer provided a cash infusion to the Company in the

amount of $ 1,000,000 and is recorded under ‘Notes payable to related parties, current portion’ on the balance sheet.

TruGolf Links Franchising, LLC

May 10, 2024 the Company formed a wholly owned subsidiary in the state of Delaware.

TruGolf Links Franchising, LLC (“Links”)

has a sole member, TruGolf, Inc.

Links was formed to establish and sell franchises that would use the Company’s indoor golf and

recreational sports simulators and other equipment.

Links offers a Service Area franchise agreement for a single location.

It also offers

a regional developer franchise agreement that allows the franchisee to sell franchises within its region.

The upfront fees range from

$ 45,000 to $ 100,000 .

Links has received proceeds of $ 500,000 from its CEO and $ 75,000 from a third party to purchase the franchise rights

to some regions yet to be determined.

As of September 30, 2024, the Company recorded $ 575,000 of deferred revenue and incurred $ 306,539

of expenses that are included in Selling, general and administrative category.

SUBSEQUENT EVENTS

October 4, 2024 the Company filed a Form S-8 to register 1,600,000 shares of the Company’s common stock – Series A to participants

in the TruGolf Holdings, Inc.

Upon mutual agreement the Purchaser

may purchase one or more additional royalties in an aggregate amount of up to $ 1,000,000 .

For the period June 2015 through May 2017, the

Company paid a monthly payment of $ 20,833 .

Effective June 1, 2017, all subsequent monthly royalty payments has been equal to the greater

of $ 20,833 plus the amount determined in accordance with the following:

If the trailing twelve-month revenue of the Company is equal to or less than $ 6,110,000 , 3.60 % of the Company’s monthly revenues, in perpetuity (unless terminated in accordance with the Royalty Agreement);

If the trailing twelve-month revenue of the Company is equal to or greater than $ 17,200,000 , 1.30 % of the Company’s monthly revenues, in perpetuity (unless terminated in accordance with the Royalty Agreement);

If the trailing twelve-month revenue of the Company is greater than $ 6,110,000 but less than $ 17,200,000 , such percentage of monthly revenue determined by dividing $ 220,060 by the amount of the trailing twelve-month revenue and multiplying the result by 100, in perpetuity (unless terminated in accordance with the Royalty Agreement).

The royalty percentage was fixed

at 3.6 % based on the trailing twelve-month revenue at the time of executing the Royalty Agreement.

On June 1, 2017, the royalty percentage

was changed to 2.4 % based on the trailing twelve-month revenues at the time as outlined in the table above.

The Royalty Agreement contains

an option for a one-time buy down of the royalty rate.

At any time following the date on which the Purchaser has received royalty payments

that are, in the aggregate, equal to two times the then applicable Aggregate Installment Amount ($ 1,000,000 ) , the Company may purchase

and extinguish 75 % (but no more nor less) of all amounts owing or to become owing to the Purchaser hereunder.

In the event the Company

wants to exercise the buy down option, the Company would pay the Purchaser $ 750,000 .

The adjusted royalty rate going forward would then

be 0.6 % ( 75 % of the 2.4 %).

The Royalty Agreement also contains

an option for a buyout upon the change of control.

If pursuant to a proposed change of control the acquirer under such transaction requires,

as a condition to the completion of such transaction, that the Company purchase and extinguish all amounts owing or to become owing to

the Purchaser hereunder, the Company will pay the greater of:

An amount equal to two times the aggregate installment amount as at the date of the change of control buyout notice;

An amount equal to A multiplied by B multiplied by C, where:

A is equal to the aggregate installment amount as at the date of the change in control divided by $ 22,500,000 ;

B is equal to 0.8;

C is equal to the net equity value of the Company;

or in the case of a proposed asset sale, the proposed net purchase price of all or substantially all of the Company’s assets.

The Royalty Agreement does not

contain a stated maturity date or bear interest.

The agreement provides for a perpetual payment obligation, whereby the Company is required

to remit a royalty equal to either 2.4 % or 0.6 % of applicable revenue, depending on whether the royalty rate buy-down option has been

While the royalty percentage may be reduced pursuant to the terms of the buy-down provision, the only mechanism for terminating

the Royalty Agreement is through a buyout that may be required by an acquirer in connection with a change of control transaction.

absence of such a change of control, the Royalty Agreement remains in effect indefinitely.

Because the gross sales royalty

payable has no stated fixed interest rate or maturity date, it is considered variable interest perpetual debt.

The periodic variable payments

to the Purchaser are recorded in interest expense.

The outstanding balance at March 31, 2025 and December 31, 2024, was $ 1,000,000 .

the three months ended March 31, 2025 and 2024, the Company incurred interest expense of $ 38,911 and $ 96,509 , respectively.

NOTE 14 – STOCKHOLDERS’

Preferred Stock

The Company has authorized preferred

stock of 10,000,000 shares with a par value of $ 0.0001 .

As of March 31, 2025 and December 31, 2024, there were no shares of preferred

stock issued and outstanding.

Class A Common Stock

The Class A Common Stock has

voting rights of 1 vote per share and votes as a single class together with the Class B Common Stock .

Class B Common Stock

The Class B Common stock has

voting rights of 25 votes per share, and votes as a single class together with the Class A Common Stock .

Equity Transactions During

Class A Common Stock

During the three months ended

March 31, 2025, the Company issued an aggregate of 662,000 shares of Class A Common Stock with a fair value of $ 2.50 per share to PIPE

Convertible Note holders for conversion of an aggregate principal amount of $ 1,655,000 in PIPE Convertible Notes (See Note 9 –

PIPE Convertible Notes ).

During the three months ended

March 31, 2025, the Company issued an aggregate of 2,402,420 shares of Class A Common Stock with fair values ranging from $ 0.34 - $ 0.60

per share to PIPE Convertible Note holders in lieu of cash for interest and make whole provisions (See Note 9 – PIPE Convertible

Warrant and Option Valuation

The Company has computed the

fair value of warrants and options granted using the Black-Scholes option pricing model.

The expected term for warrants and options issued

to non-employees is the contractual life and the expected term used for options issued to employees and directors is the estimated period

of time that options granted are expected to be outstanding.

The Company utilizes the “simplified” method to develop an estimate

of the expected term of “plain vanilla” employee option grants.

The Company is utilizing an expected volatility figure based

on a review of the historical volatilities, over a period of time, equivalent to the expected life of the instrument being valued, of

similarly positioned public companies within its industry.

The risk-free interest rate was determined from the implied yields from U.S.

Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.

Warrant Offerings

During the three months ended

March 31, 2025, the Company did not issue any warrants.

Series A Warrants

On February 2, 2024, the Company

5 five year immediately vested warrants to purchase an aggregate of 1,409,092

shares of the Company’s Class A Common Stock in association with the issuance of the PIPE Convertible Notes (the “Series

A Warrants”).

The Series A Warrants have an exercise price of $ 13.00

The Series A Warrants had an aggregate grant date fair value of $ 126,819 .

The Series A Warrants met the definition of a liability per ASC 815 – Derivatives and Hedging.

In applying the Black-Scholes

option pricing model to the Series A Warrants granted or issued, the Company used the following assumptions:

SCHEDULE OF FAIR VALUE ASSUMPTIONS OF WARRANTS

Three Months Ended

Risk free interest rate

Expected term (years)

Expected volatility

Expected dividends

The weighted average estimated

fair value of the Series A Warrants granted during the three months ended March 31, 2024, was approximately $ 0.09 per share.

No Series A Warrants were issued

during the three months ended March 31, 2025.

Series B Warrants

On February 2, 2024, the Company

issued two-and-a-half-year 2.5 immediately vested

warrants to purchase an aggregate of 1,550,000

shares of the Company’s Class A Common Stock in association with the issuance of the PIPE Convertible Notes (the “Series

B Warrants”).

The Series B Warrants have an exercise price of $ 10.00

The Series B Warrants had an aggregate grant date fair value of $ 15,500 .

In applying the Black-Scholes

option pricing model to the Series B Warrants granted or issued, the Company used the following assumptions:

SCHEDULE OF FAIR VALUE ASSUMPTIONS OF WARRANTS

Three Months Ended

Risk free interest rate

Expected term (years)

Expected volatility

Expected dividends

The weighted average estimated

fair value of the Series B Warrants granted during the three months ended March 31, 2024, was approximately $ 0.01 per share.

No Series B Warrants were issued

during the three months ended March 31, 2025.

A summary of the warrant activity

during the three months ended March 31, 2025, is presented below:

SCHEDULE OF WARRANT ACTIVITY

Outstanding, December 31, 2024

Outstanding, March 31, 2025

Exercisable, March 31, 2025

The following table presents

information related to stock warrants at March 31, 2025:

SCHEDULE OF INFORMATION RELATED TO STOCK WARRANTS

Warrants Outstanding

Warrants Exercisable

Remaining Life

NOTE 15 – STOCK-BASED

The Company accounts for its

stock-based compensation in accordance with the fair value recognition of ASC 718.

2024 Stock Incentive Plan

On November 7, 2024, the Company entered into

those certain amendments to the Waivers (the “Amendments”), pursuant to which the Company and the PIPE Investors agreed

(i) waive any breaches or defaults caused by the Company’s failure to timely file its SEC reports through August 21, 2024;

and (ii) waive certain registration failures until October 3, 2024.

In addition, the PIPE Investors waived any breaches or defaults

that may have occurred or will occur solely as a result of the Company’s failure to comply with the continued listing

requirements of the Nasdaq Stock Market due to:

(i) the Company’s failure to meet the stockholders’ equity requirement

for continued listing, provided that the foregoing waiver shall expire on January 15, 2025, (ii) the Company’s failure to meet

the market value of publicly held shares requirement for continued listing, provided that the foregoing waiver shall expire on

January 15, 2025, and/or (iii) the Company’s failure to meet the minimum bid price requirement for continued listing;

that the foregoing waiver shall expire on January 15, 2025;

provided further that to the extent the Company is in compliance with

all other Nasdaq Stock Market listing requirements and has filed a preliminary proxy statement to hold a special meeting to vote on

a reverse stock split to remedy the bid price failure, the waiver shall be extended to March 15, 2025.

In connection with the

Amendment, the Company issued an aggregate of 116,959

shares in satisfaction of certain registration statement delay payments and issued an aggregate of 65,790

shares in satisfaction of outstanding interest payments.

Such payments were made at the “Alternate Conversion Price” set

forth in the PIPE Convertible Notes, which is equal to the lesser of (i) the Conversion Price, and (ii) 90% of the lowest volume

weighted average price of the Class A common stock during the five consecutive trading days immediately prior to such

On November 7, 2024, certain PIPE Investors

agreed to purchase additional PIPE Convertible Notes in aggregate principal amount of $ 3,300,000

for aggregate proceeds of $ 2,970,000 .

In connection with the foregoing, the Company agreed to repay an aggregate of $ 2,496,686

in outstanding debt and transaction expenses.

evaluate events and transactions occurring subsequent to the date of the financial statements for matters requiring recognition or disclosure

in the financial statements.

The accompanying financial statements consider events through the date the financial statements were issued.

DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF TRUGOLF

following discussion and analysis provide information that TruGolf’s management believes is relevant to an assessment and understanding

of TruGolf’s results of operations and financial condition.

This discussion should be read in conjunction with the financial statements,

together with related notes and other information included elsewhere in this Form 10-Q.

Additionally, TruGolf’s historical results

are not necessarily indicative of the results that may be expected for any period in the future.

the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results

of Operations of TruGolf” to “we”, “us”, “our”, and “the Company” are intended

to refer to the business and operations of TruGolf.

Form 10-Q contains certain forward-looking statements.

Historical results may not indicate future performance.

Our forward-looking statements

reflect our current views about future events, are based on assumptions and are subject to known and unknown risks and uncertainties

that could cause actual results to differ materially from those contemplated by these statements.

Forward-looking

statements include, but are not limited to, statements about:

the occurrence of any event, change or other circumstances, including the outcome of any legal proceedings that may be instituted against

the ability to remedy the outstanding listing deficiencies with respect to our common stock and to maintain the listing of our securities

on Nasdaq, and the potential liquidity and trading of our securities;

the risk of disruption to our current plans and operations;

the ability to recognize the anticipated benefits of our business and the Business Combination, which may be affected by, among other

things, competition and the ability to grow, manage growth profitably, and retain key employees;

costs related to our business;

changes in applicable laws or regulations;

our ability to meet its future capital requirements to fund our operations, which may involve debt and/or equity financing, and to obtain

such debt and/or equity financing on favorable terms, and our sources and uses of cash;

our ability to execute on our plans to develop and commercialize our current clinical assets, as well as any future clinical assets that

we license, and the timing of any such commercialization;

our ability to maintain existing license agreements;

our estimates regarding expenses, future revenue, capital requirements, and needs for additional financing;

ability to achieve and maintain profitability in the future;

our financial performance;

other factors disclosed under the section entitled “Risk Factors”.

1983, TruGolf has been passionate about driving the golf industry with innovative, indoor golf solutions.

We build products that capture

the spirit of golf.

Our mission is to help grow the game by making it more available, more approachable and more affordable, through

technology – because we believe golf is for everyone.

team has built award-winning video games (including Links , a popular sports game for PC), innovative hardware solutions, and an

all-new e-sports platform to connect golfers around the world with TruGolf E6 Connect Software, our premier software engine.

Since TruGolf’s

beginning, we have continued to define and redefine what is possible with golf technology.

addition to offering a variety of custom, professional, and portable golf simulators, TruGolf’s latest launch monitor, Apogee,

was created to improve accuracy and to make using the launch monitor easier.

Features of Apogee include:

a unique Apogee Voice Assistant,

a voice command system that allows users to navigate their TruGolf E6 Connect Software gameplay within rounds and practice sessions;

Laser Launchpad, a laser indicator that shows users where to place the ball and when the system is ready to record a swing and Point-of-Impact

(POI) slow-motion replay video.

suite of hardware offerings in the golf technology space is expansive, offering something for virtually everyone from gamers to beginners

to professionals, and all consumers in between.

Hardware offerings are sold through a global network of authorized resellers, retail

outlets and direct-to-consumer through a dedicated TruGolf sales team.

Our suite of hardware offerings ranges from entry level pricing

at just under $400, to well over $100,000 for custom projects, creating a wide range of pricing options for nearly all consumers, and

providing TruGolf with a competitive advantage in creating a wide consumer base as compared to its competitors (who often only focus

in a narrow consumer price range).

creates top golf technology software in the marketplace through its TruGolf E6 Connect Software.

Importantly, TruGolf E6 Connect Software

is designed not only for use with our suite of hardware offerings in the golf technology space, but also integrates with more than twenty-four

third party golf technology hardware manufacturers, translating to a market integration coverage equal to roughly 90% of golf technology

hardware in the global market space, which allows peer-to-peer play across these golf technology hardware manufacturers, allowing for

a unification of the golf technology space.

TruGolf E6 Connect Software records, on average, over 725,000 indoor golf shots per day.

TruGolf E6 Connect Software is both PC and iOS compatible and can be used both indoors and outdoors.

has leveraged its unique position as one of the industry leaders in both hardware and software golf technology solutions to organize

and found the Virtual Golf Association (VGA).

The VGA is a gamified virtual economy that takes place inside the TruGolf E6 Connect Software.

Users have a chance to earn points through play, practice, and more – providing a worldwide leaderboard of connected indoor golfers.

Each shot users take rewards them with points.

These points can be used to purchase in-game enhancements, or to enter virtual golf tournaments

with real world prizes.

The VGA is broken into three models:

Analysis – rewards TruGolf E6 Connect Software users who track and measure their game.

Users can set specific goals (e.g.,

shots hit per month, speed and distance gains, dispersion reduction) and earn points for hitting milestones.

At the end of each month,

users can see how they compared against all other users utilizing the Game Analysis features.

Golf – rewards users for joining with their friends and playing golf online.

Earn points for playing a new course or linking

up to play nine holes with another player utilizing TruGolf E6 Connect Software.

Golf Association Events – events are worldwide leaderboard format, flighted by handicap, where users play and compete to shoot

the lowest score.

These contests include stroke play, closest to the pin, match play, stableford, and more.

Users earn points based

on how they finish in their division.

totality, TruGolf’s business model is designed to be positioned as the hub of golf technology, with groundbreaking hardware technologies

that we believe can become the industry standard and unifying the industry as a whole by serving as the leader of golf technology software

solutions through its TruGolf E6 Connect Software.

January 31, 2024, the Company consummated the business combination (the “Closing”) contemplated by the previously announced

Amended and Restated Agreement and Plan of Merger, dated as of July 21, 2023 (as amended, the “Merger Agreement”), by and

among the Company, DMAC Merger Sub Inc., a Nevada corporation and a wholly-owned subsidiary of the Company (“Merger Sub”),

Bright Vision Sponsor LLC, a Delaware limited liability company, in the capacity as the Purchaser Representative thereunder, Christopher

Jones, in the capacity as the Seller Representative thereunder, and TruGolf, Inc., a Nevada corporation (“TruGolf Nevada”).

As a result of the Closing and the transactions contemplated by the Merger Agreement, (i) Merger Sub merged with and into TruGolf (the

“Merger”), with TruGolf Nevada surviving the Merger as a wholly-owned subsidiary of the Company, and (ii) the Company’s

name was changed from Deep Medicine Acquisition Corp.

(“DMAQ”) to TruGolf Holdings, Inc.

The Company’s Class A common

stock commenced trading on the Nasdaq Global Market LLC under the ticker symbol “TRUG” on February 1, 2024.

for the Business Combination

Merger was accounted for as a reverse recapitalization in accordance with U.S.

Under this method of accounting, DMAQ was treated

as the acquired company for accounting purposes, whereas TruGolf Nevada was treated as the accounting acquirer.

In accordance with this

method of accounting, the Business Combination was treated as the equivalent of TruGolf Nevada issuing shares for the net assets of DMAQ,

accompanied by a recapitalization.

The net assets of DMAQ and TruGolf Nevada were stated at historical cost, with no goodwill or other

intangible assets recorded, and operations prior to the Business Combination were those of TruGolf Nevada.

TruGolf Nevada has been determined

to be the accounting acquirer for purposes of the Business Combination based on an evaluation of the following facts and circumstances:

TruGolf Nevada stockholders have a majority of the voting power of New TruGolf,

Nevada comprising the ongoing operations of New TruGolf,

Nevada contributing a majority of the governing body members of New TruGolf, and

Nevada’s senior management comprising the senior management of New TruGolf.

November 2, 2023 and December 7, 2023, DMAQ executed loan agreements with certain accredited investors (together, the “Prior Loan

Agreements”) pursuant to which such investors agreed to loan DMAQ up to an aggregate $11,000,000 in exchange for the issuance of

convertible notes and warrants.

On February 2, 2024, the Company executed a securities purchase agreement (the “Purchase Agreement”)

with each of the investors that executed the Prior Loan Agreements, which replaced, in their entirety, the Prior Loan Agreements, and

with additional investors (together, the “PIPE Investors”).

Pursuant to the terms and conditions of the Purchase Agreement,

the PIPE Investors agreed to purchase from the TruGolf Holdings (i) senior convertible notes in the aggregate principal amount of up

to $15,500,000 (the “PIPE Convertible Notes”), (ii) Series A warrants to initially purchase 1,409,091 shares of the Company’s

Class A common stock (the “Series A Warrants”);

and (iii) Series B warrants to initially purchase 1,550,000 shares of the

Company’s Class A common stock (the “Series B Warrants,” and collectively with the Series A Warrants, the “PIPE

Warrants”) (the “PIPE Financing”).

Purchase Agreement contemplates funding of the investment (the “Investment”) across multiple tranches.

At the first closing

(the “Initial Closing”) an aggregate principal amount of $4,650,000 of PIPE Convertible Notes will be issued upon the satisfaction

of certain customary closing conditions in exchange for aggregate gross proceeds of $4,185,000, representing an original issue discount

On such date (the “Initial Closing Date”), we also issued the PIPE Investors the Series A Warrants and the Series

to satisfying the conditions discussed below, TruGolf Holdings, Inc.

has the right under the Purchase Agreement, but not the obligation,

to require that the PIPE Investors purchase additional Notes at up to two additional closings.

Upon notice at any time after the 2nd

trading day following the Initial Closing Date, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate

principal amount of $4,650,000 of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $4,185,000, if (i) the Registration

Statement (as described below) has been filed;

and (ii) certain customary closing conditions are satisfied (the “First Mandatory

Additional Closing”).

Upon notice at any time after the 2nd trading day following the date that the First Mandatory Additional

Closing is consummated, TruGolf Holdings may require that the PIPE Investors purchase an additional aggregate principal amount of $6,200,000

of PIPE Convertible Notes, in exchange for aggregate gross proceeds of $5,580,000, if (i) the shareholder approval is obtained (as described

(ii) the Registration Statement has been declared effective by the SEC;

and (iii) certain customary closing conditions are satisfied

(the “Second Mandatory Additional Closing”).

addition, pursuant to the Purchase Agreement, as amended by the Waiver (described below) each PIPE Investor has the right, but not the

obligation, to require that, upon notice, TruGolf Holdings sell to such PIPE Investor at one or more additional closings such PIPE Investor’s

pro rata share of up to a maximum aggregate principal amount of $10,850,000 in additional PIPE Convertible Notes (each such additional

closing, an “Additional Optional Closing”);

provided that, the principal amount of the additional PIPE Convertible Notes

issued at each Additional Optional Closing must equal at least $250,000.

If a PIPE Investor has not elected to effect an Additional Optional

Closing on or prior to August 30, 2025, such PIPE Investor shall have no further right to effect an Additional Optional Closing under

the Purchase Agreement.

August 13, 2024, the Company entered into those certain waiver and amendment agreements (the “Waivers”), pursuant to which the Company

and the PIPE Investors agreed to:

(i) waive any breaches or defaults caused by the Company’s failure to timely file its SEC reports

through August 14, 2024;

(ii) extend the date by which the Additional Optional Closings may occur until 11 months from the effective

date of the initial Registration Statement;

(iii) permit the Company to raise debt financing from its affiliates through non-convertible,

unsecured notes with a maturity date that is later than the maturity date of the PIPE Convertible Notes;

(iv) waive certain registration

failures until September 3, 2024 and permit the issuance of common stock to satisfy certain registration failures;

and (v) allow the

Company to satisfy the interest payments due April 1, 2024, July 1, 2024 and October 1, 2024 from the issuance of common stock or by

allowing such amounts to be added to the principal amount of the PIPE Convertible Notes, at the option of the PIPE Investors.

certain PIPE Investors agreed to acquire additional PIPE Convertible Notes without regard to any volume or price requirements in the

In connection with the Waiver, the Company issued an aggregate of 192,151 shares in satisfaction of certain registration

statement delay payments and issued an aggregate of 157,582 shares in satisfaction of outstanding interest payments.

Such payments were

made at the “Alternate Conversion Price” set forth in the PIPE Convertible Notes, which is equal to the lesser of (i) the

Conversion Price, and (ii) 90% of the lowest volume weighted average price of the Class A common stock during the five consecutive trading

days immediately prior to such conversion.

November 7, 2024, the Company entered into those certain amendments to the Waivers (the “Amendments”), pursuant to which the Company and

the PIPE Investors agreed to:

(i) waive any breaches or defaults caused by the Company’s failure to timely file its SEC reports

through August 21, 2024;

and (ii) waive certain registration failures until October 3, 2024.

In addition, the PIPE Investors waived any

breaches or defaults that may have occurred or will occur solely as a result of the Company’s failure to comply with the continued

listing requirements of the Nasdaq Stock Market due to:

(i) the Company’s failure to meet the stockholders’ equity requirement

provided that the foregoing waiver shall expire on January 15, 2025, and/or (iii) the Company’s failure to

meet the minimum bid price requirement for continued listing;

provided that the foregoing waiver shall expire on January 15, 2025;

further that to the extent the Company is in compliance with all other Nasdaq Stock Market listing requirements and has filed a preliminary

proxy statement to hold a special meeting to vote on a reverse stock split to remedy the bid price failure, the waiver shall be extended

to March 15, 2025.

In connection with the Amendment, the Company issued an aggregate of 116,959 shares in satisfaction of certain registration

statement delay payments and issued an aggregate of 65,790 shares in satisfaction of outstanding interest payments.

Such payments were

made at the “Alternate Conversion Price” set forth in the PIPE Convertible Notes, which is equal to the lesser of (i) the

Conversion Price, and (ii) 90% of the lowest volume weighted average price of the Class A common stock during the five consecutive trading

days immediately prior to such conversion.

November 7, 2024, certain PIPE Investors agreed to purchase additional PIPE Convertible Notes in aggregate principal amount of $3,300,000

for aggregate proceeds of $2,970,000.

In connection with the foregoing, the Company agreed to repay an aggregate of $2,496,686 in outstanding

debt and transaction expenses.

Links Franchising, LLC

May 10, 2024 the Company formed a wholly owned subsidiary in the state of Delaware.

TruGolf Links Franchising, LLC (“Links”)

has a sole member, TruGolf, Inc.

Links was formed to establish and sell franchises that would use the Company’s indoor golf and

recreational sports simulators and other equipment.

Links offers a Service Area franchise agreement for a single location.

It also offers

a regional developer franchise agreement that allows the franchisee to sell franchises within its region.

The upfront fees range from

$45,000 to $100,000.

Links has received proceeds of $500,000 from its CEO and $75,000 from a third party to purchase the franchise rights

to some regions yet to be determined.

As of September 30, 2024, the Company recorded $575,000 of deferred revenue and incurred $306,539

of expenses that are included in the Selling, general and administrative category.

software development cost

capitalize certain costs related to the development of our software used in our simulators.

In accordance with authoritative guidance,

including ASC 985-20, Software-Costs of Software to be Sold, Leased or Marketed , we began to capitalize these costs when the technological

feasibility was established and preliminary development efforts were successfully completed, management authorized and committed project

funding, and it was probable that the project would be completed and the software would be used as intended.

Such costs are amortized

when placed in service, on a straight-line basis over the estimated useful life of the related asset, estimated to be three years beginning

on February 1, 2024.

Costs incurred prior to meeting these criteria together with costs incurred for training and maintenance are expensed

as incurred and recorded in product development expenses on our statements of operations.

The Company does not capitalize any testing

or maintenance costs.

The accounting for these capitalized software costs requires us to make significant judgments, assumptions and

estimates related to the timing and amount of recognized capitalized software development costs.

For the nine months ended September

30, 2024 we capitalized $1,967,418 of costs related to the development of software applications.

Amortization of capitalized software

costs was $279,001 for the for the nine months ended September 30, 2024.

The balance of capitalized software was $1,738,417 net of accumulated

amortization of $279,001 at September 30, 2024.

Management INC

Ethos Asset Management Loan Agreement (“Loan Agreement”) stipulates that fundings should happen approximately every 30 banking

days, subject to Ethos completing periodic internal audits to ensure the Company was in compliance with the terms of loan agreement.

Ethos Management informed the Company in August 2023, that unrelated to TruGolf, Ethos Management is currently undergoing a routine audit

of its loan portfolio, and pending the close of the audit, borrowers may experience delays in drawing on funds when requested.

the lack of additional fundings and in accordance with the terms of the Loan Agreement, in February 2024, we sent Ethos a notice of termination

for materially breaching the Loan Agreement.

Based on the termination for default clause in the Loan Agreement, we are entitled to retain

all the funds disbursed by Ethos and Ethos must release the deposit collateral.

The Company has recorded a liability of $589,619 as of

September 30, 2024 which is the amount remaining after applying the security collateral of $1,875,000 against the loan payable and accrued

note that the simulator/screen golf market is growing according to the National Golf Foundation (www.ngf.org/simulator-golf-sees-real-surge),

“An estimated 6.2 million Americans hit golf balls with a club in a golf simulator within the past year, a total that surged 73%

compared to pre-pandemic levels.

Golf’s continued evolution includes many new forms of the game and simulated golf is a part of

it.” Based on the growing golf simulator industry trend, we continue to believe there is a strong demand for our new hardware and

software products.

Based on the growing industry golf simulator trend noted above, we continue to believe there is a strong demand for

our new hardware and software products.

to recently released data from The National Golf Foundation, 45 million Americans aged 6 and above played golf in 2023.

This record-setting

total includes 32.9 million people who played off-course golf, with 18.4 million of them who participated exclusively in off-course golf

activities at places such as driving ranges, indoor golf simulators, or golf entertainment venues.

Only 12.1 million played exclusively

on-course, furthering the trend.

External Factors Affecting Our Operating Results

believe that our performance and future success depend on many factors that present significant opportunities for us but also pose risks

and challenges, including those discussed below and in the section entitled “Risk Factors”.

The growth of our business depends on our ability to gain broader acceptance of our current products by continuing

to make users aware of the significant benefits of our products to generate increased demand and frequency of use, and thus increase

Our ability to grow our business will also depend on our ability to expand our customer base in existing or new target

markets, including international markets.

Although we have increased the number of users of TruGolf hardware and software product

offerings and continue to grow our channels globally through established relationships and focused sales efforts, we cannot provide

assurance that our efforts will continue to increase the use of our products.

force size and effectiveness.

The rate at which we grow our sales force and expansion channels and the speed at which newly hired

salespeople and sales channels become effective can impact our revenue growth and our costs incurred in anticipation of such growth.

We intend to continue to make significant investments in our sales and marketing organization and channels by increasing the number

of sales representatives and expanding our international programs to help facilitate further adoption of our products as well as

broaden awareness of our products to new customers.

We are slowly expanding into EMEA through a quickly growing network of distributors

that will each slowly develop their respective territories, sales from EMEA are still below 5% of total sales.

We have also signed

a Joint Venture agreement with a partner in China to manage all distribution needs across Asia.

We are not required to invest in

any of these markets, and as such take a lower margin on products sold there, therefore we expect slowly growing impacts on top line

revenue from these globalization efforts.

and geographic mix;

Our financial results, including our gross margins, may fluctuate from period to period based on

the timing of orders, fluctuations in foreign currency exchange rates and the number of available selling days in a particular period,

which can be impacted by a number of factors, such as holidays or days of severe inclement weather in a particular geography, the

mix of products sold and the geographic mix of where products are sold.

Components of Revenues, Costs and Expenses

revenues come from the sale of TruGolf software and hardware, which products are sold through a global network of authorized resellers,

retail outlets and direct-to-consumer through a dedicated TruGolf sales team.

of revenues consists primarily of costs that are directly related to the delivery of our TruGolf hardware and software products, excluding

depreciation but including direct material, labor, manufacturing overhead, reserves for estimated warranty costs and charges to write-down

the inventory carrying value when it exceeds the estimated net realizable value.

have agreements with certain software golf hardware vendors who bundle our tracking and golf course software with their hardware.

pay them a royalty based on the number of units or subscriptions they sell.

The royalty percentages typically range between 20% to 30%.

The royalty agreements are for one year, with automatic renewal unless each party gives a thirty-day written notice of the intent to

cancel the contract prior to the renewal date.

Wages and Benefits

wages and benefits are expenses earned by our employees in the executive, information technology, finance and accounting, human resources,

administrative functions and outside contractors.

Also included in salaries, wages and benefits are employer payroll taxes, health, dental

and life insurance expenses.

The Company did not grant options

during the three months March 31, 2025 or 2024.

Compensation-based stock option

activity for qualified and unqualified stock options are summarized below:

SCHEDULE OF OPTION ACTIVITY

Outstanding, December 31, 2024

Outstanding, March 31, 2025

Exercisable, March 31, 2025

The following table summarizes

information about options to purchase shares of the Company’s Class A common stock outstanding and exercisable at March 31, 2025:

SCHEDULE OF STOCK OPTIONS OUTSTANDING AND EXERCISABLE

Options Outstanding

Options Exerciseable

Exercise Price

Life In Years

Total compensation expense related

to options was $ 3,341 for the three months ended March 31, 2025.

As of March 31, 2025, there was future compensation cost of $ 7,798 with

a weighted average recognition period of 0 .75 years.

The aggregate intrinsic value

totaled $ 0 and was based on the Company’s closing stock price of $ 0.35 as of March 31, 2025, which would have been received by the

option holders had all option holders exercised their options as of that date.

Stock-Based Compensation

The following table presents

information related to stock-based compensation expense:

SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE

Three Months Ended

Unrecognized at

Weighted Average

General and administrative

and marketing expenses consist primarily of advertising, training events, brand building, product marketing activities and installation

and shipping costs.

We expect sales and marketing costs will continue to increase as we expand our international selling and marketing

activities, hire additional personnel, and build brand awareness through advertising and training.

and administrative expenses consist primarily of professional fees paid for legal, accounting, auditing, and consulting services, bad

debt, licenses and association dues, facilities (including rent and utilities) bank and credit card processing fees and other expenses

related to general and administrative activities.

anticipate that our general and administrative expenses will continue to increase as we continue hiring to support our growth.

anticipate that we will incur increased accounting, audit, legal, regulatory, compliance, and investor and public relations expenses

associated with operating as a public registrant.

expense consists of interest expenses associated with issuing notes and balances outstanding under our debt obligations and the gross

sales royalty payable, the amortization of debt issuance costs and original issue discounts associated with such borrowings.

generate cash primarily from our operating activities and, historically, we have used cash flows from operating activities and available

borrowings under certain notes payable as the primary sources of funds to purchase inventory and to fund working capital and capital

expenditures, growth and expansion opportunities (see also “Liquidity and Capital Resources” below).

The management of our

working capital is closely tied to operating cash flows, as working capital can be impacted by, among other things, our accounts receivable

activities, the level of inventories, which may increase or decrease in response to current and expected demand, and the size and timing

of our trade accounts payable payment cycles.

Accounting Estimates

prepare our financial statements in accordance with accounting principles generally accepted in the United States of America.

The application

of many accounting principles requires us to make assumptions, estimates and/or judgments that affect the reported amounts of assets,

liabilities, revenues and expenses in our financial statements.

We base our estimates and judgments on historical experience and other

assumptions that we believe are reasonable under the circumstances.

These assumptions, estimates and/or judgments, however, are often

subjective and they and our actual results may change based on changing circumstances or changes in our analyses.

If actual amounts are

ultimately different from our estimates, the revisions are included in our results of operations for the period in which the actual amounts

first become known.

We believe the following critical accounting estimates could potentially produce materially different results if

we were to change underlying assumptions, estimates and/or judgments.

See also Note 2 for a summary of our significant accounting policies.

Receivable, net

manage credit risk associated with our accounts receivable at the customer level.

believe the concentration of credit risk, with respect to our receivables, is limited because our customer base is comprised of a number

of geographically diverse customers.

We manage credit risk through credit approvals and other monitoring procedures.

allowance is estimated using a loss rate model based on delinquency.

The estimated loss rate is based on our historical experience with

specific customers, our understanding of our current economic circumstances, reasonable and supportable forecasts, and our own judgment

as to the likelihood of ultimate payment based upon available data.

The actual rate of future credit losses, however, may not be similar

to past experience.

Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy

or in the particular circumstances of individual customers.

Accordingly, we may be required to increase or decrease our allowance for

doubtful accounts.

of our inventory consists of raw materials and are valued at the lower of historic cost or net realizable value;

where net realizable

value is considered to be the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion,

disposal and transportation.

Historic inventory costs are calculated on an average or specific cost basis.

The Company records inventory

write-downs for excess or obsolete inventories based upon assumptions on current and future demand forecasts.

fair value of the warrants is estimated on the date of issuance using the Black-Scholes option pricing model, which requires the input

of subjective assumptions, including the expected term of the warrants, expected stock price volatility, and expected dividends.

estimates involve inherent uncertainties and the application of management’s judgment.

Expected volatilities used in the valuation

model are based on the average volatility of the comparable companies publicly traded on recognized stock exchanges.

The risk-free rate

for the expected term of the option is based on the United States Treasury yield curve in effect at the time of the grant.

of Operations

of the Three Months ended September 30, 2024 and 2023

following table sets forth certain condensed statements of operations data for the periods indicated in dollars.

In addition, we note

that the period-to-period may not be indicative of future performance.

Three Months Ended September 30,

Revenues, net

Cost of revenues

Operating expenses

(Loss) income from operations

Net (loss) income

Net loss income per common share

revenues were $6,236,795 for the three months ended September 30, 2024, compared to $3,431,735 for the three months ended September 30,

2023, an increase of $2,805,060 or 81.74%.

The increase in revenues was due primarily to the increase of our product acceptance and greater

penetration in the industry market.

cost of revenues for the three months ended September 30, 2024, increased $390,402 or 25.46% to $1,924,093 from $1,533,691 for the three

months ended September 30, 2023.

The increase was due primarily to the increase in revenues as noted above.

The Company’s adjustment

to inventory included in the cost of revenue, resulted in a reduction of costs of $115,692 and charged cost of revenues $267,224 during

the three months ended September 30, 2024 and 2023, respectively.

Materials and components to manufacture our simulators primarily include

fabricated steel, cut cloth, turf, computers, cameras and other high-end electronics which are subject to inflationary pricing pressures.

The cost of shipping our finished simulators increased $36,741 to $163,232 during the three months ended September 30, 2024 compared

to the same period in 2023 due to price increases from our national shipping companies UPS, FedEx and Seko.

We are continuously working

with our suppliers for volume pricing discounts and extended contract terms.

operating expenses were $3,440,421 for the three months ended September 30, 2024, compared to $4,221,755 for the three months ended September

30, 2023, a decrease of $781,334 or (18.51)%.

The decrease for the three months ended September 30, 2024, compared to the three months

ended September 30, 2023, was due primarily to:

increase of $36,021 in royalty expenses was due to the addition of new distributors and increases in the royalty percentages for

certain resellers.

$557,170 decrease in salaries, wages and benefits expenses.

The three-month period year over year decrease is a result of the Company’s

human resource management efforts to reduce payroll expenses.

$260,185 decrease in selling, general and administrative expenses.

The three months over the prior year’s three months decrease

is a result of sales and marketing expenses decreasing by $323,604 and bad debt expense decreasing by $450,000.

During the same periods,

rent and facility costs increased by $23,917, insurance expenses increased by $169,126 (principally for liability insurance), professional

fees increased by $63,963 (of which $148,438 was incurred by Links) and subscription software expense increased by $128,092.

general and administrative expenses increased by $128,321.

interest income was $38,592 and $21,197 for the three months ended September 30, 2024 and 2023, respectively.

interest expense was $971,048 and $358,354 for the three months ended September 30, 2024 and 2023, respectively, an increase of $612,694

or 170.97% primarily due to the interest incurred on the PIPE convertible notes.

of Operations

of the Nine Months ended September 30, 2024 and 2023

following table sets forth certain condensed statements of operations data for the periods indicated in dollars.

In addition, we note

that the period-to-period may not be indicative of future performance.

Nine Months Ended September 30,

Revenues, net

Cost of revenues

Operating expenses

(Loss) income from operations

Net loss income per common share

revenues were $15,121,980 for the nine months ended September 30, 2024, compared to $13,788,700 for the nine months ended September 30,

2023, an increase of $1,333,280 or 9.67%.

The increase in revenues was due primarily to the increase of our product acceptance and greater

penetration in the industry market.

of revenues for the nine months ended September 30, 2024, increased $651,899 or 14.39% to $5,183,328 from $4,531,429 for the nine months

ended September 30, 2023.

The increase was due primarily to an increase in revenues as discussed above.

The inventory adjustment included

in the cost of revenues increased by $88,786 from $35,105 to $123,891 during the nine months ended September 30, 2024 and 2023, respectively.

Materials and components to manufacture our simulators primarily include fabricated steel, cut cloth, turf, computers, cameras and other

high-end electronics which are subject to inflationary pricing pressures.

The cost of shipping our finished simulators increased $304,505

due to price increases from our national shipping companies UPS, FedEx and Seko.

We are continuously working with our suppliers for volume

pricing discounts and extended contract terms.

operating expenses were $10,795,100 for the nine months ended September 30, 2024, compared to $16,074,927 for the nine months ended September

30, 2023, a decrease of $5,279,827 or (32.85%).

The decrease for the nine months ended September 30, 2024, compared to the nine months

ended September 30, 2023, was due primarily to:

increase of $272,302 in royalty expenses was due to the addition of new distributors and increases in the royalty percentages for

certain resellers.

$1,517,318 decrease in salaries, wages and benefits expenses due primarily to management’s efforts to reduce payroll expenses.

$4,034,811 decrease in selling, general and administrative expenses.

The nine months over the prior year’s nine months decrease

is a result of:

March 2023, the Board of Directors granting and authorizing the issuance 821 shares of common stock two consultants (and holders

of the convertible notes described in Note 12 – Convertible Noted Payable in our annual audited financial statements included

elsewhere in this Form 8K) in March 2023 for consulting service performed.

The Company recorded consulting fee expense (noncash)

of $4,493,333 (estimated fair value of the stock) at the time of grant and issuance.

general and administrative expenses (such as facilities professional fees, warehouse, travel, office supplies etc.) increased $360,173

for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 as a result of amortization of

capitalized software costs of $279,001, an increase in professional fees of $639,941 (of which $306,539 was incurred by Links), an

increase in insurance expense of $428,627, an increase of facility expense of $153,400, an increase in software subscriptions and

other subscriptions expense of $379,973, an increase in bank charges of $28,093, offset in part by a decrease in sales and marketing

of $528,711, a decrease in bad debt expense of $657,271 and a decrease in general and administrative expenses of $362,880.

interest income was $105,800 and $71,542 for the nine months ended September 30, 2024 and 2023, respectively.

interest expense was $2,176,810 and $1,265,775 for the nine months ended September 30, 2024 and 2023, respectively, an increase of $911,035

or 71.97% primarily due to the interest on the PIPE convertible notes.

and Capital Resources

Company consummated the business combination described in Note 1 and Note 2 on January 31, 2024.

The Company received proceeds of approximately

$2,237,213, net of closing costs, expenses and commissions.

The Company recorded a PIPE Convertible Note, the source of the proceeds

from the business combination, of $4,650,000 with an original issue discount of $465,000 (or 10%).

Company received proceeds of $575,000 from the agreements for franchise regions sold by its wholly owned subsidiary, TruGolf Links Franchising,

LLC, which was recorded as deferred revenue.

The Company expects to grow this revenue stream in subsequent quarters.

have primarily obtained cash to fund our operations through the reinvestment of free cash flows generated from our business operations,

issuance of common stock to private friend and family investors, issuance of term loans, issuance of notes payable and convertible debt

instruments, and royalty structures.

of September 30, 2024 and December 31, 2023, we had $7,452,185 and 5,397,564 in cash, cash equivalents and restricted cash and current

working capital deficit of $1,736,0636 and working capital of $1,988,267, respectively.

December 2023, we entered into a $2,000,000 variable rate line of credit with JP Morgan Chase Bank, N.A.

The purpose of the new line

of credit was to consolidate the balances outstanding on the note payable and the previous line of credit, which had matured.

of credit matures on December 31, 2024.

The line of credit has an annual interest rate computed at the Adjusted SOFR (Secured Overnight

Financing Rate) Rate and at a rate of 3.00% above the SOFR Rate.

The Adjusted SOFR rate means the sum of the Applicable margin (3.50%

per annum) plus the SOFR rate applicable to the interest period plus the Unsecured to Secured Rate Adjustment.

The majority of the variable

rate line of credit was paid during the three months ended June 30, 2024.

As of September 30, 2024, the remaining balance was $10,114

and was included in the cash balance.

Flow from Operating Activities

the nine months ended September 30, 2024 the net cash provided by our operating activities was $3,071,781 including the liquidation of

the marketable securities account of $2,478,953.

The change in the remaining operating assets and liabilities was $2,550,049, depreciation

and amortization of $331,728, the amortization of the ROU asset of $251,612 and the amortization of original issue discount of $47,447.

the nine months ended September 30, 2023 the net cash used in our operating activities was $6,121,139.

The change in operating assets

and liabilities was a decrease of $3,714,981.

Other assets increased due to the $1,875,000 deposit paid for the Ethos Management Inc

loan and $116,040 in Ethos Management Inc deferred loan fees.

The net loss of $8,011,889 was partially offset by increases to cash from

depreciation and amortization of $45,682, amortization of convertible notes original issue discount of $183,695, amortization of ROU

asset of $217,101, bad debt expense of $665,920 and stock-based compensation expense of $4,493,333.

Flows from Investing Activities

the nine months ended September 30, 2024 and 2023, the cash used by our investing activities was $1,967,533 and $2,508,749, respectively.

For the nine months ended September 30, 2024 the Company capitalized software development costs of $1,967,418.

For the nine months ended

September 30, 2023 the Company purchased fixed assets of $89,024 and purchased short-term investments of $2,419,725.

Flows from Financing Activities

Company consummated the business combination described in Note 1 and Note 2 on January 31, 2024.

The Company received proceeds of approximately

$2,325,315, net of closing costs, expenses and commissions.

The Company recorded a PIPE Convertible Note, the source of the proceeds

from the business combination, of $4,650,000 less an original issue discount of 465,000 (or 10%).

the nine months ended September 30, 2024 the cash provided by our financing activities was $950,373.

The Company received net proceeds

from the Merger of $2,325,315, made debt payments of $294,005, paid $15,716 of assumed liabilities, paid $100,000 on a loan assumed in

the Merger, and paid off the line of credit of $1,980,937.

The Company received proceeds of $1,000,000 from the Company’s chief

executive officer.

the nine months ended September 30, 2023 we borrowed $1,945,397 on our Morgan Stanely margin line of credit account, received proceeds

of $2,499,999 from loans, received $185,500 from convertible note holders and made debt payments of $107,837.

One shareholder returned

$75,096 in overpaid past dividends.

The loan proceeds were used for ongoing operations.

Company has incurred net losses and negative operating cash flows for the nine months ended September 30, 2024 and 2023.

As the Company

continues to incur losses, successful transition to profitability is dependent on achieving a level of revenues adequate to support the

Company’s cost structure.

Unless and until this occurs, the Company may need to raise capital or issue debt to support ongoing

Company’s financial statements are prepared on a going concern basis, which contemplates the realization of assets and the satisfaction

of obligations in the normal course of business.

Continuation as a going concern is dependent upon continued operations of the Company,

which in turn is dependent upon the Company’s ability to meet its financial requirements, raise additional capital, and the success

of its future operations.

the rules of ASC Subtopic 205-40 “Presentation of Financial Statements-Going Concern” (“ASC 205-40”), the Company

is required to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its future financial obligations

as they become due within one year after the date that these financial statements are issued or available to be issued.

This evaluation

considers a Company’s current available cash and projected cash needs over the one-year evaluation period but may not consider

things beyond its control.

Company believes the recent merger, as described in Note 1 and Note 2, may enable us to raise additional capital through equity offerings

and not incur more debt or loans payable.

significant projected cash requirements related primarily to operating expenses for the next 12 months include $7,000,000 to $8,000,000

for employees’ salaries, wages and benefits, $950,000 to $1,200,000 for installation and customers service, and $1,000,000 to $1,200,000

for development of software and hardware.

No assurances can be given that the results anticipated by our projections will occur.

respect to long-term liquidity requirements, approximately $12,400,000 of our debt contractually matures in the years 2025 to 2033.

the event the projected results do not occur, we may have to significantly delay, scale back or discontinue the development and commercialization

of one or more product offerings and other strategic initiatives.

Additionally, we would reduce the number of new hires planned during

the remaining months of 2024, and implement cost reduction measures such as a reduction in headcount, reducing the planned sales and

marketing expense among other cost reduction measures.

We may also issue common stock to potential investors to increase our liquidity.

believes the plan outlined above provides an opportunity for the Company to continue as a going concern.

Cash Requirements for Known Contractual and Other Obligations

have entered into operating leases for our corporate headquarters and a warehouse in Centerville, Utah.

The leases have varying terms

expiring between 2023 and 2025.

In June 2023, we entered into a sixty-month, triple net lease for additional warehouse space in North

Salt Lake, Utah.

The lease payments range between $10,457 and $11,770.

enter into agreements in the normal course of business with various vendors, which are generally cancellable upon notice.

upon cancellation consist only of payments for services provided or expenses incurred, including non-cancellable obligations of service

providers, up to the date of cancellation.

Accounting Pronouncements

has evaluated all recent accounting pronouncements issued by the Financial Accounting Standards Board and determined that none of the

pronouncements will have a material impact on our financial statements.

We will continue to monitor the issuance of any new accounting

pronouncements and assess their potential impact on the financial statements in future periods.

Growth Company

are an emerging growth company, as defined in the JOBS Act.

Under the JOBS Act, emerging growth companies can delay adopting new or revised

accounting standards until such time as those standards apply to private companies.

We have elected to use this extended transition period

for complying with new or revised accounting standards that have different effective dates for public and private companies until the

earlier of the date that (i) we are no longer an emerging growth company or (ii) we affirmatively and irrevocably opt out of the extended

transition period provided in the JOBS Act.

As a result, these financial statements may not be comparable to companies that comply with

new or revised accounting pronouncements as of public company effective dates.

We may choose to early adopt any new or revised accounting

standards whenever such early adoption is permitted for private companies.

and Qualitative Disclosures About Market Risk

had cash and cash equivalents totaling $7,452,185 as of September 30, 2024.

Cash equivalents were invested primarily in low interest

checking or savings accounts.

Our investment policy is focused on the preservation of capital and supporting our liquidity needs.

our investment policy, we will only invest in highly rated securities, issued by the U.S.

government or liquid money market funds.

do not invest in financial instruments for trading or speculative purposes, nor do we use leveraged financial instruments.

We may utilize

external investment managers who adhere to the guidelines of our investment policy.

A hypothetical 10% change in interest rates would

not have a material impact on the value of our cash, cash equivalents and restricted cash, net loss or cash flows.

do not have significant exposure to interest rate risk as only our lines of credit are variable rate.

As of September 30, 2024, the variable

rate lines of credit had a balance outstanding of $802,738 compared to the total fixed rate debt outstanding of $14,509,137.

Thus, management

believes a hypothetical 10% change in interest rates would not have a material impact on annualized interest expenses.

maintain our cash in bank deposit accounts which, at times, may exceed any applicable Federal Deposit Insurance Corporation (“FDIC”)

insurance limits.

As of September 30, 2024, the amount exceeding the federally insured limits was $6,125,053.

Cybersecurity

have completed an assessment of our suite of controls including technology hardware and software solutions, regular testing of the resiliency

of our systems including penetration and disaster recovery testing as well as regular training sessions on cybersecurity risks and mitigation

strategies and have engaged a third party to bring us up to industry best practices.

We have established an incident response plan and

team to take steps it determines are appropriate to contain, mitigate and remediate a cybersecurity incident and to respond to the associated

business, legal and reputational risks.

There is no assurance that these efforts will fully mitigate cybersecurity risk and mitigation

efforts are not an assurance that no cybersecurity incidents will occur and have had no such breaches of security.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

applicable as we are a smaller reporting company.

NOTE 16 – LEASES

The Company is party to two

(i) office space in Centerville, Utah (the “Centerville Lease”) and (ii) a warehouse in North Salt Lake City, Utah

(the “SLC Lease”).

The Centerville lease is scheduled to expire in May 2028 and the SLC Lease is scheduled to expire in November

The Company has operating leases

for its corporate headquarters and warehouse.

The Company determines if an arrangement contains a lease at inception based on the ability

to control a physically distinct asset.

Operating lease right-of-use assets are recorded in the consolidated balance sheets on the initial

measurement of the lease liability as adjusted to include prepaid rent and initial direct costs less any lease incentives received.

liabilities are measured at the commencement date based on the present value of the lease payments over the lease term.

The Company separately

accounts for lease and non-lease components within lease agreements.

The Company uses its incremental borrowing rate to present value

the lease liability as key inputs to determine the interest rate implicit in the lease are not shared by lessors.

Operating lease expense is recorded

on a straight-line basis over the lease term.

Right-of-use assets and lease liabilities for short-term leases are not recognized in the

consolidated balance sheets.

Payments for short-term leases are recognized in the consolidated statements of operations on a straight-line

basis over the lease term.

When measuring lease liabilities

for leases that were classified as operating leases, the Company discounted lease payments using its estimated incremental borrowing rate

at lease inception point.

The weighted average incremental borrowing rate applied was 8.39 %.

As of March 31, 2025, the Company’s

leases had a remaining weighted average term of 2.15 years.

The following table presents

net lease cost and other supplemental lease information:

SCHEDULE OF LEASE COST AND SUPPLEMENTAL LEASE INFORMATION

Operating lease cost (cost resulting from lease payments)

Net lease costs

Operating lease - operating cash flows (fixed payments)

Operating lease - operating cash flows (liability reduction)

Non-current leases - right-of-use assets

Current liabilities - operating lease liabilities

Non-current liabilities - operating lease liabilities

Future minimum payments under

non-cancelable leases for operating leases for the remaining terms of the leases following the three months ended March 31, 2025, are

SCHEDULE OF FUTURE MINIMUM PAYMENTS UNDER OPERATING LEASES

Operating Leases

Total future minimum lease payments

Amount representing interest

Present value of net future minimum lease payments

17 – SEGMENT INFORMATION

The Company currently operates

as one business segment, which is also the sole reportable segment, focusing on the manufacturing and sales of indoor golf simulators.

The Company’s business offerings have similar economic and other characteristics, including the nature of products, manufacturing,

types of customers, and distribution methods.

The determination of a single business segment is consistent with the consolidated financial

information regularly provided to the Company’s chief operating decision maker (“CODM”).

The Company’s CODM is

its Principal Executive and Financial Officer and Director, who reviews and evaluates consolidated profit and loss and total assets for

the purpose of assessing performance, making operating decisions, allocating resources, and planning and forecasting for future periods.

In addition to the significant

expense categories included within net loss presented on the Company’s Consolidated Statements of Operations, see below for disaggregated

amounts that comprise consulting, contract labor, personnel, business development, royalty, and marketing expenses:

SCHEDULE OF REVENUE BY SEGMENT INFORMATION

For The Three Months Ended March 31,

Consulting expenses

Contract labor

Personnel expenses

Business development expenses

Royalty expenses

Marketing expenses

Other expenses *

Total operating expenses

Other expenses is materially comprised of rent, insurance, stock-based compensation, depreciation and amortization, licenses, dues and subscriptions, travel and entertainment, and merchant fees.

NOTE 18 – COMMITMENTS

AND CONTINGENCIES

There are no material pending

legal proceedings in which the Company or any of its subsidiaries is a party or in which any director, officer or affiliate of the Company,

any owner of record or beneficially of more than 5% of any class of its voting securities, or security holder is a party adverse to the

Company, or has a material interest adverse to the Company.

NOTE 19 – CONCENTRATION

OF CREDIT RISK

Cash Deposits

Financial instruments that potentially

subject the Company to concentrations of credit risk consist principally of cash deposits.

Accounts at each institution are insured by

the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 .

As of March 31, 2025 and December 31, 2024, the Company

had approximately $ 11,244,000 and $ 9,662,000 , respectively, in excess of the FDIC insured limit.

NOTE 20 – SUBSEQUENT

Dividend Notes Payable

On April 21, 2025, the Company

entered into agreements with the holders of approximately $ 3.9

million in outstanding notes payable (including accrued interest) originally issued in November 2022, including officers and

directors of the Company, pursuant to which such note holders converted all outstanding amounts payable to such note holders into

(i) 8,283,139

shares of the Company’s Class B common stock, with respect to $ 2.6

million in principal and interest of such notes payable, and into (ii) 4,233,077

shares of Class A common stock, with respect to $ 1.3

million in principal and interest of such notes payable, in each case at a conversion price of $ 0.31204

per share, which was above the closing price of the Company’s Common Stock prior to conversion.

PIPE Convertible Notes

On April 21, 2025, the Company agreed to cancel and

rescind the conversion of $ 300,000 of PIPE Convertible Notes, plus interest, as a result of such noteholder not being able to take possession

of such conversion shares prior to the expiration of a DWAC deposit by our transfer agent with the Depository Trust Company.

On April 22, 2025, the Company entered into Exchange

Agreements (the “Exchange Agreements” and each, an “Exchange Agreement”), by and among the Company and each of

the Holders, pursuant to which each such Holder would exchange (i) the amounts remaining outstanding under the PIPE Convertible Notes

and certain other amounts outstanding with respect thereto in the aggregate amount (the “Note Exchange”), and (ii) the PIPE

Pursuant to the Exchange Agreements, on the effective date of the Exchange Agreements, the PIPE Warrants were exchanged, in

reliance on the exemption from registration provided by Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities

Act”), into an aggregate of 1,885 shares of the Company’s newly created Series A preferred stock (the “Series A Preferred

Stock” and such Series A Preferred Stock to be issued in the exchange of the PIPE Warrants, the “Initial New Exchange Preferred

Shares”, and such shares of Class A Common Stock (the “Common Stock”) issuable pursuant to the terms of the Certificate

of Designations, including, without limitation, upon conversion or otherwise, collectively, the “Initial New Exchange Conversion

Shares”), and (ii) a warrant to purchase up to 37,033 shares of Series A Preferred Stock.

The Note Exchange will occur on the Closing Date (as

defined in the Exchange Agreements), whereby the amounts owing under the PIPE Convertible Notes will be exchanged into shares of the Company’s

Series A Preferred Stock.

From the date of the Exchange Agreements until the date of the Note Exchange, the conversion price of the PIPE

Convertible Notes was reduced to $ 1.00 per share.

Additionally, the Exchange Agreements amended the

Prior Purchase Agreement and contained certain covenants of the Company to, among other items, hold one or more stockholder meetings no

later than 90 days following the execution of the Exchange Agreements to approve the shares of the Company’s Common Stock issuable

underlying the Series A Preferred Stock upon conversion in compliance with the rules and regulations of the Nasdaq Stock Market.

Issuance of Common Stock

Subsequent to March 31, 2025, the Company issued an

aggregate of 2,182,159 shares of Class A common stock with fair values ranging from $ 0.221 - $ 1.00 per share to PIPE Convertible Note

holders in connection with the conversion of outstanding PIPE Convertible Notes, accrued interest, and make-good provisions.

On May 5, 2025, the Company issued 50,000 shares of

Class A common stock with a fair value of $ 0.284 per share to a PIPE Convertible Note holder in lieu of cash for accrued interest.

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

What changed 10-Q

Item 1. Financial Statements