What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-15 compared with 2025-11-14 · 170 added, 300 removed, 49 unchanged (91% of the section changed)

Management’s Discussion and Analysis of Financial

Condition and Results of Operations

You should read the following discussion and analysis of our financial

condition and results of operations for the periods ended September 30, 2025 and 2024 in conjunction with our unaudited consolidated financial

statements and the related notes included elsewhere in this Quarterly Report and our audited financial statements contained in our most

recent Form 10-K.

This discussion contains forward-looking statements that involve risks and uncertainties.

Our actual results and the

timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors,

including those set forth under “Risk Factors” and elsewhere in this Quarterly Report.

The Company offers a suite

of proprietary business-to-business software solutions designed to enhance user engagement through gamification and rewards.

allow our partners to offer in-game prizing and rewards, including merchandise, coupons, digital goods, and sweepstakes entries — inside

their websites, their venues, or their streaming media content.

The Company’s customers

primarily include professional and collegiate sports teams, event venues such as arenas and stadiums, and advertising agencies, which

typically use our products as part of their live events or as part of an advertising campaign with the goal of engaging fans, increasing

consented first-party data, and increasing sales.

At September 30, 2025 and December 31, 2024, the Company had three active customers.

The Company continues to pursue new customer relationships and expansion opportunities within its core verticals.

The Company’s products

are designed to enable end users to be able to earn prizes by registering on our system and completing in-content challenges like trivia,

polls, or casual mobile games.

Players could use our system to play a variety of games and earn a wide range of prize types, provided

by advertisers and sponsors.

The Company’s current offerings include the in-venue XEO and Filter Fan Cam (FFC) platforms for live

events, as well as the stand-alone “Winfinite” product line that can be used by brands, advertising agencies, and content

partners to reach potential customers outside of sports venues, on mobile devices.

We also have an IP portfolio that could create future

licensing and product development opportunities including our recently allowed Artificial Intelligence (“AI”) and Machine

Learning (“ML”) series of patent claims.

Management’s Discussion and Analysis

of Financial Condition and Results of Operations

The following discussion

and analysis of our financial condition and results of operations should be read together with and is qualified in its entirety by reference

to the condensed consolidated financial statements and related notes that are included elsewhere in this Quarterly Report on Form 10-Q.

This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties.

Our actual results

may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed

under “Risk Factors,” set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025,

and any updates thereto set forth in this Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission

(“SEC”), including future SEC filings.

We offer a suite of proprietary

business-to-business software tools that are meant to drive user engagement through gamification and rewards.

These tools allow our partners

to offer in-game prizing and rewards, including merchandise, coupons, digital goods, and sweepstakes entries — inside their websites,

their venues, or their streaming media content.

Our customers mostly sports

teams, venues (Arenas, Football Stadiums, Baseball Stadiums), fan engagement and sponsor activation platforms, digital out-of-home media

companies, and advertising agencies, which typically use our products as part of their live events or as part of an advertising campaign

with the goal of engaging fans, increasing consented first-party data, and increasing sales.

At March 31, 2026 and December 31, 2025,

we had four active customers.

Our products and games are

designed so that end users could earn prizes by registering on our system and completing in-content challenges like trivia, polls, or

casual mobile games.

Players could use our system to play a variety of games and earn a wide range of prize types, provided by advertisers

and sponsors.

Our products, include our in-venue Filter Fan Cam (“FFC”) products for live events, our stand-alone “Winfinite”

product line that can be used by brands, advertising agencies, and content partners to reach potential customers outside of sports venues,

on mobile devices, as well as the “Winfinite” Games, which are customizable web-based casual games.

We also have an IP portfolio

that could create future licensing and product development opportunities including our recently allowed Artificial Intelligence (“AI”)

and Machine Learning (“ML”) series of patent claims.

With the acquisition of Xcite

Interactive in June 2021, we acquired a number of key pieces of technology and relationships that have supported the growth and development

of the Company’s engagement and rewards platform, including a live events fan engagement business that has partnered with professional

sports franchises in the National Football League (“NFL”), the National Basketball Association (“NBA”), the National

Hockey League (“NHL”) and others to increase audience engagement using interactive gaming functions like trivia, polling,

and casual games that can be played alongside live experiences whether a player is at-home, in a restaurant, or in-venue at the event

The Company’s largest customers in 2024 included the Texas Rangers and the San Jose Sharks.

For the nine months ended September

30, 2025, the Company’s largest customer was ASPIS, a significant shareholder and continues to do business with the Texas Rangers.

Transactions with ASPIS were conducted on an arm’s-length basis and in accordance with applicable related-party transaction policies.

We now have three principal

software products.

Our eXtreme Engagement Online or “XEO” platform is designed primarily for in-venue main-board work in stadiums

Our Filter Fan Cam (FFC) platform is an Augmented Reality filtering tool that can be used for mobile and in-venue applications.

In addition, we have a stand-alone gaming and prizing product that we call “Winfinite,” which allows brands, media companies,

and advertising agencies to reach out to customers directly on their mobile devices.

We license these three software products to teams,

ad agencies, and other content creators.

During the period, the Company made progress in establishing operations

and partnerships in Brazil, a new target market expected to begin generating revenue in the near term.

Discussions have included major

soccer franchises, leagues, festival promoters, and tennis organizations.

The Company has also implemented cybersecurity solutions provided

by Aspis Cyber Technologies, Inc.

to strengthen the security of its websites and technology infrastructure.

The Company has initiated

an ongoing project to develop new intellectual property aimed at enhancing and modernizing its technology portfolio.

These initiatives

are intended to strengthen the Company’s competitive position over time.

Management continues to focus on expanding customer relationships,

enhancing its technology offerings, and pursuing new opportunities in key markets such as Brazil.

The Company believes these initiatives,

together with ongoing cost discipline and strategic partnerships, may support improved financial performance in future periods.

Interactive in June 2021, we acquired a number of key pieces of technology and relationships that have helped to drive our engagement

and rewards business, including a live events fan engagement business that has partnered with professional sports franchises in the National

Football League (“NFL”), the National Basketball Association (“NBA”), the National Hockey League (“NHL”)

and others to increase audience engagement using interactive gaming functions like trivia, polling, and casual games that can be played

alongside live experiences whether a player is at-home, in a restaurant, or in-venue at the event itself.

Our largest customers in 2024

were the Texas Rangers and San Jose Sharks.

For the year ended December 31, 2025, the Company’s largest customer was ASPIS, a significant

shareholder and we continue to do business with the Texas Rangers.

We offer a suite of products

centered on “Winfinite” and FFC.

Our FFC platform is an Augmented Reality filtering tool that can be used for mobile and in-venue

applications.

In addition, we have a stand-alone gaming and prizing product that we call “Winfinite,” which allows brands,

media companies, and advertising agencies to reach out to customers directly on their mobile devices.

We license these software products

to teams, ad agencies, and other content creators.

Significant Components of Our Results of Operations

We recognize revenue in accordance with ASC 606, Revenue from Contracts

with Customers, when control of promised goods or services transfers to a customer in an amount that reflects the consideration we expect

to receive in exchange for those goods or services.

Our contracts may include multiple performance obligations, and we evaluate the timing

of revenue recognition—whether at a point in time or over time—based on when control of each promised good or service transfers

to the customer.

We earn revenue through the

development and maintenance of custom-built software.

general, we recognize revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will

flow to us, where there is evidence of an arrangement, when the selling price is fixed or determinable, and when specific criteria have

been met or there are no significant remaining performance obligations for each of our activities as described below.

Foreseeable losses,

if any, are recognized in the year or period in which the loss is determined.

We earn revenue through

the development and maintenance of custom-built software.

We recognize revenues received

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require significant judgment.

Judgment is also required to determine the amount of revenue associated with each distinct performance obligation.

Judgment is also required to determine the amount of revenue associated with each distinct performance

Operating Expenses.

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primary component of each of these operating expense categories, which consist of cash-based personnel costs, such as salaries, benefits

Additionally, these categories include intangible amortization, amortization expense, interest expense, software costs, professional

fees and share-based compensation.

Additionally, these categories include professional fees and share-based compensation.

Operating Results

Comparison of Results of Operations for the three months ended September

30, 2025 and 2024

Comparison of Results of Operations for the Three-Month periods

ended March 31, 2026 and March 31, 2025

The following table summarizes

our results of operations for the three months ended September 30, 2025 and 2024:

our results of operations for the three-month periods ended March 31, 2026 and 2025:

For the Three Months Ended

September 30,

Consolidated Statement of Operations and Comprehensive Income (Loss) Data:

Cost of revenues

Research and development

Selling, general and administrative

Total operating expenses

Operating income (loss)

Other income (expense), net

Other comprehensive income (loss), net of tax:

Change in foreign currency translation, net of tax

Total comprehensive loss

Basic and diluted earnings (loss) per share to shareholders

We realized no revenue for the three month period ended September 30,

2025, representing a decrease of $3,848, or 100%, from $3,848 for the three month period ended September 30, 2024.

The decrease can be

attributed to the recognition of revenue attributed to our Xcite business which did not reoccur in 2025.

Research and development

Research and development expense was $14,470 for the three month period

ended September 30, 2025, representing an increase of $3,008, or 26%, from $11,462 for the three month period ended September 30, 2024.

The increase was primarily due to increases in vendor cost associated with our research and development activities.

Selling, general and administrative

Selling, general and administrative expense was $741,931 for the three

month period ended September 30, 2025, representing an increase of $220,521, or 42%, from $521,410 for the three month period ended September

The increase was primarily due to an increase in professional services as the Company is looking to expand operations in Brazil.

Operating Results

Comparison of Results of Operations for the nine month period ended

September 30, 2025 and 2024

The following table summarizes

our results of operations for the nine months ended September 30, 2025 and 2024:

For the Nine Months Ended

September 30,

Consolidated Statement of Operations and Comprehensive Income (Loss) Data:

Statement of Operations and Comprehensive Loss Data:

Cost of revenues

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Operating loss

Other income (expense), net

Other comprehensive income (loss), net of tax:

Change in foreign currency translation, net of tax

Total comprehensive loss

$ (1,095,994 )

Basic and diluted loss per share to shareholders

Our revenues are derived

primarily from our license with ASPIS and related professional services.

Revenue was $2,179,348 for the nine month period ended September

30, 2025, representing an increase of $2,122,060, or 3,704%, from $57,288 for the nine month period ended September 30, 2024.

can be attributed to the recognition of the ASPIS license revenue and professional services.

Other income/(expense)

Revenue was $17,300 for the

three-month period ended March 31, 2026, representing a decrease of $182,047, or 91%, from $199,347 for the three-month period ended March

The decrease was primarily due to one-time consulting services attributed to the ASPIS arrangement which accounted for approximately

$176,000 during the three months ended March 31, 2025.

Cost of revenues

Cost of revenues was $16,446 for the nine month period ended September

30, 2025, representing a decrease of $23,831, or 59%, from $40,277 for the nine month period ended September 30, 2024.

The decrease was

due to the decrease in infrastructure needed for the Xcite Interactive.

Cost of revenues was $0 for

the three-month period ended March 31, 2026, representing a decrease of $8,223 or 100%, from $8,223 for the three month period ended March

The decrease was primarily due to a change in revenue mix as the $17,300 of revenue was attributable to the Company’s

legacy Xcite business, which did not incur associated cost of revenues during the period.

Research and development

Research and development expense was $26,838 for the nine month period

ended September 30, 2025, representing a decrease of $91,239, or 77%, from $118,077 for the nine month period ended September 30, 2024.

The decrease was primarily due to significant reductions in staff related to our company restructuring in the prior year.

Research and development

was $0 for the three month period ended March 31, 2026, representing a decrease of $6,149, or 100%, from $6,149 for the three month period

ended March 31, 2025.

The decrease was primarily due to a reduction in software costs.

Selling, general and administrative

expense was $3,126,425 for the nine month period ended September 30, 2025, representing a decrease of $302,637, or 9%, from $5,429,062

for the nine month period ended September 30, 2024.

The decrease was primarily due to a decrease in payroll as the Company reduced head

count and a decrease in professional fees, offset by a one-time severance payment of $305,000 during the nine months ended September 30,

was $835,995 for the three-month period ended March 31, 2026, representing a decrease of $521,741, or 38%, from $1,357,736 for the three

month period ended March 31, 2025.

The decrease was primarily due to a decrease in administrative employees and stock compensation.

Loss from Operations

Loss from operations was

$818,695 for the three month period ended March 31, 2026, representing a decrease of $354,066, or 30%, from $1,172,761 for the three month

period ended March 31, 2025.

The decrease was primarily the result of decreased expenses and headcount offset by the decrease in revenue.

The effect of inflation on

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Liquidity and Capital Resources

We have cash of $1,405,628 and a working capital balance of $2,770,192

as at September 30, 2025, compared to a cash position of $3,065,914 and working capital balance of $3,509,272 as at December 31, 2024.

The decrease in our cash related to using cash to fund operations and ongoing losses for the nine months ended September 30, 2025 and

a decrease in working capital balance was due to the decrease in cash as a result of cash used in operations.

Since inception, the Company

has incurred operating losses as it continues to invest in developing and commercializing its technology platform.

The company incurred

a net loss of $0.8 million for the three months ended March 31, 2026.

For the years ended December 31, 2025 and 2024, we incurred net

losses of approximately $2.1 million and $4.6 million, respectively.

During these periods, operations were primarily financed through

residual proceeds from the Company’s initial public offering of common shares in January 2021 and subsequent equity and debt transactions,

including warrant exercises and private placements.

In October 2024, warrant holders exercised approximately $0.9 million of warrants,

and in November and December 2024 the Company raised $2.5 million through convertible notes.

Our cash and cash equivalents as of March

31, 2026 was $0.4 million.

Our primary cash needs are for working capital requirements, headcount, capital expenditures and to fund our

We are subject to the risks

and uncertainties common to emerging growth businesses.

Management believes that current resources and expected operating revenues may

not be sufficient to fund planned activities for the next twelve months.

The report of our independent registered public accounting firm

on the Company’s consolidated financial statements for the year ended December 31, 2025 and 2024 included an explanatory paragraph

noting that recurring operating losses, accumulated deficit, and negative operating cash flows raise substantial doubt about the Company’s

ability to continue as a going concern within one year after the issuance of those financial statements.

We are pursuing initiatives

intended to improve cash flows from operations and continue to evaluate strategic and financing alternatives to strengthen liquidity.

To execute the business plan and support growth initiatives, the Company may seek additional financing through equity or debt offerings,

credit facilities, or other arrangements.

There can be no assurance that such financing will be available on terms acceptable to the Company,

Any future equity or equity-linked financing could dilute existing stockholders and may affect the market price of the Company’s

common shares, while debt financing, if obtained, could impose covenants or interest obligations.

If sufficient funding is not secured

when required, the Company may need to further align its operating expenditures with available resources, which could impact certain development

programs or staffing levels.

Management believes that disciplined cost control, continued customer engagement, and expansion into new

markets may provide a foundation for improved liquidity over time;

however, material uncertainties remain until additional financing or

sustained positive cash flows are achieved.

The Company and ASPIS entered into a Stock Purchase Agreement (the

Pursuant to the SPA, the Company will sell to ASPIS, and Aspis will purchase for cash, a number of shares of Company

common stock, at a price, equal to $1,700,000 divided by 105% of the closing price of a share of Company common stock on the day preceding

consummation.

The purchase price per share shall be 105% of such closing price.

On May 15, 2026, the Company received notification from

ASPSIS that they wired $1,200,000 pursuant to the Stock Purchase Agreement;

however, no shares had been issued under the SPA as of such

The Company expects to receive the remaining balance of the purchase price in the near future and all shares will be issued at that

Based on the Company’s historic and projected expenses and revenues, the Company expects the proceeds from the SPA to result

in the Company maintaining at least $2,500,000 in stockholders’ equity through at least December 31, 2026.

In addition, as disclosed

in Note 9, in the first quarter of 2026, the Audit Committee of the Company’s Board of Directors conducted an internal investigation

and determined that fraudulent activity involving the Company’s former Chief Financial Officer had occurred.

A promissory note was

executed in connection therewith;

however, there can be no assurance that such note will be collected in part or full or at all.

of May 15, 2026, no monies have been repaid on the promissory note.

Our financial condition and

liquidity is and will continue to be influenced by a variety of factors, including:

ability to generate cash flows from our operations;

indebtedness and the interest we are obligated to pay on this indebtedness;

availability of public and private debt and equity financing;

capital expenditure requirements.

Since inception, the Company has incurred operating losses as it continues

to invest in developing and commercializing its technology platform.

For the nine months ended September 30, 2025 and 2024, the Company

recorded net losses of approximately $1.0 million and $3.5 million, respectively.

During these periods, operations were primarily financed

through an initial public offering of common shares in January 2021 and subsequent equity and debt transactions, including warrant exercises

and private placements.

In October 2024, warrant holders exercised approximately $0.9 million of warrants, and in November and December

2024 the Company raised $2.5 million through convertible notes.

As of September 30, 2025, cash and cash equivalents totaled $1.4 million.

The Company’s principal cash requirements relate to working capital, capital expenditures, and funding ongoing operations.

The Company continues to be subject to the risks and uncertainties

common to emerging growth businesses.

Management believes that current resources and expected operating revenues may not be sufficient

to fund planned activities for the next twelve months.

The report of our independent registered public accounting firm on the Company’s

consolidated financial statements for the year ended December 31, 2024 included an explanatory paragraph noting that recurring operating

losses, accumulated deficit, and negative operating cash flows raise substantial doubt about the Company’s ability to continue as

a going concern within one year after the issuance of those financial statements.

Management is pursuing initiatives intended to improve cash flows from

operations and continues to evaluate strategic and financing alternatives to strengthen liquidity.

To execute the business plan and support

growth initiatives, the Company may seek additional financing through equity or debt offerings, credit facilities, or other arrangements.

There can be no assurance that such financing will be available on terms acceptable to the Company, or at all.

Any future equity or equity-linked

financing could dilute existing stockholders and may affect the market price of the Company’s common shares, while debt financing,

if obtained, could impose covenants or interest obligations.

If sufficient funding is not secured when required, the Company may need

to further align its operating expenditures with available resources, which could impact certain development programs or staffing levels.

Management believes that disciplined cost control, continued customer engagement, and expansion into new markets may provide a foundation

for improved liquidity over time;

however, material uncertainties remain until additional financing or sustained positive cash flows are

our ability to generate cash flows from our operations;

future indebtedness and the interest we are obligated to pay on this indebtedness;

the availability of public and private debt and equity financing;

changes in exchange rates which will impact our generation of cash flows from operations when measured in CAD;

our capital expenditure requirements.

The following summarizes

the key components of our cash flows for the nine month period ended September 30, 2025 and 2024:

September 30,

Net cash used in operating activities

$ (1,484,267 )

$ (4,255,345 )

the key components of our cash flows for the three month periods ended March 31, 2026 and 2025:

Net cash provided by (used in) operating activities

Net cash used in investing activities

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Net decrease in cash and cash equivalents

$ (1,660,286 )

$ (4,217,759 )

Operating Activities

Net cash used in operating activities for the nine months ended September

30, 2025 was $1,484,267 as compared to $4,255,345 for the nine months ended September 30, 2024.

The decrease in cash used in operating

activities was primarily attributable to a decrease in the net loss of $2,558,363 and prepaids of $879,061 off set by an increase of stock-based

compensation of $248,087 and an increase in contract assets of $1,166,000.

Net cash provided by operating

activities for the three month period ended March 31, 2026 was $143,986 as compared to cash used in operations of $641,445 for the three

month period ended March 31, 2025.

The decrease in cash used in operating activities was primarily attributable to a decrease in the net

loss of $337,782, increase in collections of accounts receivable of $642,700 and an increase in accounts payable and accrued liabilities

These increases were offset by decreases in stock-based compensation of $344,524 and prepaid expenses of $191,334.

Investing Activities

Cash used in investing activities

of $300,000 for the nine months ended September 30, 2025 was attributed to monies spent on developed technology attributed to the Company’s

new product offerings.

No cash was used in or provided by investing activities for the nine months ended September 30,2024, respectively.

Net cash used in investing

activities for the three months ended March 31, 2026 was $327,000 as compared to $0 for the three months ended March 31, 2025.

in cash flow used in investing activities was primarily attributable to monies spent on capitalized software development for technology

attributed to the Company’s new product offerings.

Financing Activities

No cash was used in or provided

by financing activities for the nine months ended September 30, 2025 and 2024, respectively.

Critical Accounting Estimates

The preparation of condensed

consolidated financial statements requires management to make certain estimates, judgments and assumptions that affect the reported amounts

of assets and liabilities at the date of the consolidated financial statements.

Estimates and assumptions are continually evaluated and

are based on historical experience and management’s assessment of current events and other facts and circumstances that are considered

to be relevant.

by financing activities for the three months ended March 31, 2026 and 2025, respectively.

Critical Accounting Policies and Estimates

The preparation of consolidated

financial statements requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets

and liabilities at the date of the consolidated financial statements.

Estimates and assumptions are continually evaluated and are based

on historical experience and management’s assessment of current events and other facts and circumstances that are considered to

Actual results could differ from these estimates.

Significant assumptions about

the future and other sources of estimation uncertainty that management has made at the end of the reporting year, that could result in

a material adjustment to the carrying amounts of assets and liabilities in the event that actual results differ from assumptions made,

relate to, but are not limited to, the following:

Revenue recognition

The Company recognizes revenue

when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects

to receive in exchange for those goods or services.

To determine revenue recognition for arrangements that an entity determines are within

the scope of Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”),

the entity performs the following five steps:

(i) identify the contract(s) with a customer;

(ii) identify the performance obligations

in the contract;

(iii) determine the transaction price;

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

and (v) recognize revenue when (or as) the entity satisfies a performance obligation.

The Company only recognizes revenue from contracts

when it is probable that the entity will collect substantially all the consideration it is entitled to in exchange for the goods or services

it transfers to the customer.

The Company earns revenue

in two primary ways:

1) the sales of software-as-a-service (SAAS) from its interactive production software platform or 2) development

and maintenance of custom-built software or other professional services.

The Company recognizes SAAS

revenues from its interactive production sales over the life of the contract as its performance obligations are satisfied.

Payment terms

vary by contract and can be periodic or one-time payments.

The Company determines that the customer receives and consumes the benefits

of the service simultaneously as the service is provided.

The transaction price is allocated to the contractual performance obligations

and recognized ratably over the contract term.

The Company recognizes revenues

received from the development and maintenance of custom-built software and other professional services provided upon the satisfaction

of its performance obligation in an amount that reflects the consideration to which the Company expects to be entitled in exchange for

those services.

Performance obligations can be satisfied either at a single point in time or over time.

For those performance obligations

that are satisfied at a single point in time, the revenue is recognized at that time.

For each performance obligation satisfied over time,

the Company recognizes revenue by measuring the progress toward complete satisfaction of that performance obligation.

generally measures progress comparing hours incurred to total estimated hours.

For revenues received from

the sales of advertising, the Company is deemed the agent in its revenue agreements.

The Company does not own or obtain control of the

digital advertising inventory.

The Company recognizes revenues upon the achievement of agreed-upon performance criteria for the advertising

inventory, such as a number of views, or clicks.

As the Company is acting as an agent in the transaction, the Company recognizes revenue

from sales of advertising on a net basis, which excludes amounts payable to partners under the Company’s revenue sharing agreements.

The Company’s contracts

with customers may include promises to transfer multiple products and services.

For these contracts, the Company accounts for individual

performance obligations separately if they are capable of being distinct and distinct within the context of the contract.

whether products and services are considered distinct performance obligations may require significant judgment.

Judgment is also required

to determine the stand-alone selling price, for each distinct performance obligation.

During the nine months ended

September 30, 2025, the Company recognized $176,000 attributed to professional services.

License Revenue

We recognize revenue when or as the performance obligations in the

contract are satisfied.

For performance obligations that are fulfilled at a point in time, revenue is recognized at the fulfillment of

the performance obligation.

Since the IP is determined to be a functional license, the value of the grant of use is recognized in the

first period of the contract term in which the license agreement is in force.

For the three and nine month periods ended September 30,

2025, none and $1,980,000, respectively, of revenue was recognized on our functional IP as the Technology Agreement with ASPIS as the

license had been delivered to ASPIS during the quarter.

The Company invoices ASPIS on a monthly basis with 30 day payment terms.

For the three and nine months ended September 30, 2025 the Company has collected $825,000 and $1,001,000, respectively, from ASPIS.

Stock-based compensation

The estimation of share-based

payments (including warrants and stock options) requires the selection of an appropriate valuation model and consideration as to the inputs

necessary for the valuation model chosen.

We use the Black-Scholes valuation model at the date of the grant.

We make estimates as to the

volatility, the expected life, dividend yield and the time of exercise, as applicable.

The expected volatility is based on the average

volatility of share prices of similar companies over the period of the expected life of the applicable warrants and stock options.

expected life is based on historical data.

These estimates may not necessarily be indicative of future actual patterns.

Emerging Growth Company and Smaller Reporting

Company Status

We are an emerging growth

company, as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act.

Under the JOBS Act, emerging growth companies

can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act 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 we (a) are no longer an emerging

growth company or (b) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

As a result, our

condensed financial statements may not be comparable to those of companies that comply with the 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.

We are also a “smaller reporting company.” If we are a

smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure

requirements that are available to smaller reporting companies.

Specifically, as a smaller reporting company, we may choose to present

only the two most recent fiscal years of audited consolidated financial statements in our Form 10-K and, similar to emerging growth companies,

smaller reporting companies have reduced disclosure obligations regarding executive compensation.

Quantitative and Qualitative Disclosures about Market Risk

Our critical accounting estimates reflecting management’s estimates and judgments are described in our

Annual Report on Form 10-K for the year ended December 31, 2025.

We have reviewed recently issued accounting pronouncements and are evaluating

the potential impact, if any, on our condensed consolidated financial statements.

Accordingly, there have been no material changes to

critical accounting policies and estimates as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.

Quantitative and Qualitative Disclosures

about Market Risk

Not required under Regulation

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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 2. Management’s Discussion and Analysis