What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-03-31 compared with 2025-03-31 · 571 added, 880 removed, 633 unchanged (70% of the section changed)

25 unchanged sentences

Notwithstanding the foregoing,

our management, including our Chief Executive Officer and Chief Financial Officer, have concluded that the consolidated financial statements

included in this Annual Report on Form 10-K present fairly, in all material respects, our financial position, results of operations and

cash flows for the periods presented in conformity with accounting principles generally accepted in the United States.

our management, including our Chief Executive Officer and Chief Financial Officer, have concluded that the consolidated financial

statements included in this Annual Report on Form 10-K present fairly, in all material respects, our financial position, results of operations

and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States.

We may in the future identify

70 unchanged sentences

in supply chain management, business intelligence, and advanced analytics.

Kirchenbauer is the founder of TWK Ventures LLC, where

he leads a healthcare data and analytics consulting practice.

From 2018 to July 2023, he served as Senior Vice President of Digital Supply

at Vizient Inc., where he played a key role in developing a digital ecosystem to advance supply chain automation and analytics solutions.

Kirchenbauer has worked for Vizient Inc.

since 2018 and

is currently the Senior Vice President, Digital Supply.

As Senior Vice President of

30 unchanged sentences

Health, Vizient, and NYU Langone Health.

Matozzo has served as the

CEO and Managing Partner of Paradigm Venture Group since 2020.

Matozzo has served as

the CEO and Managing Partner of Paradigm Venture Group since 2020.

Prior to that, he served as Director of Strategic Sourcing and Procurement

1 unchanged sentence

Code of Business Conduct and Ethics

We have adopted a Code of Business

Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller

or persons performing similar functions and also to other employees.

Our Code of Business Conduct can be found on our website at www.SCWorx.com.

We have adopted a Code of

Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer

or controller or persons performing similar functions and also to other employees.

Our Code of Business Conduct can be found on our website

at www.SCWorx.com.

Family Relationships

88 unchanged sentences

Hannibal was hired as Chief Revenue Officer on February 1, 2019 and was appointed Interim Chief Financial Officer on June 10, 2020.

August 10, 2020 Mr.

On August 10, 2020 Mr.

Hannibal was appointed President and Chief Operating Officer.

On May 28, 2021 Mr.

Hannibal was appointed President

and Chief Executive Officer.

Hannibal was appointed President and Chief Executive Officer.

Kohler has served as Chief Financial Officer since November 1, 2020.

6 unchanged sentences

Name and Principal Position

Michael Burke (1)

Troy Kirchenbauer (1)

Chairman and Director

Vincent Matozzo (2)

Troy Kirchenbauer (3)

Michael Burke (3)

Chairman and Director

Alton Irby (4)

2 unchanged sentences

Former Director

John Ferrara (6)

Former Director

Burke was appointed as a Director on October 31, 2024.

Matozzo was appointed as a Director on August 17, 2023.

Effective May 15, 2024, Mr Matozzo returned all previously received stock grants

to the Company.

Kirchenbauer was appointed as a Director on October 31, 2024.

Irby was appointed as a Director on March 16, 2021.

Effective May 15, 2024, Mr Irby returned all previously received stock grants to

Troy Kirchenbauer was appointed as a Director on October 31, 2024.

Vincent Matozzo was appointed as a Director on August 17, 2023.

Effective May 15, 2024, Mr Matozzo returned all previously received stock grants to the Company.

Michael Burke was appointed as a Director on October 31, 2024.

Alton Irby was appointed as a Director on March 16, 2021.

Effective May 15, 2024, Mr Irby returned all previously received stock grants to the Company.

Mr Irby resigned as a Director effective October 31, 2024.

Horowitz was appointed as a Director on August 11, 2021.

Effective May 15, 2024, Mr Horowitz returned all previously received

stock grants to the Company.

Steven Horowitz was appointed as a Director on August 11, 2021.

Effective May 15, 2024, Mr Horowitz returned all previously received stock grants to the Company.

Mr Horowitz resigned as a Director effective October 31, 2024.

Ferrara was appointed as a Director on August 11, 2021.

Mr Ferrera resigned as a Director effective August 18, 2023.

Stock compensation reported above represents accrued but not yet issued shares as of December 31, 2025

Security Ownership of Certain Beneficial

16 unchanged sentences

Steven Horowitz

beneficial ownership of less than 1% of our outstanding stock.

determining beneficial ownership of our common stock as of a given date, the number of shares shown includes shares of common stock that

may be acquired upon the exercise of stock options within 60 days of March 31, 2025.

In determining the percent of common stock

owned by a person or entity on March 31, 2025, (a) the numerator is the number of shares of the class beneficially owned by such

person or entity, including shares which may be acquired within 60 days of March 31, 2025 upon the exercise of stock options, and

(b) the denominator is the sum of (i) the total shares of common stock outstanding on March 31, 2025 and (ii) the total number

of shares that the beneficial owner may acquire upon exercise of stock options within 60 days March 31, 2025.

Unless otherwise indicated,

the address of each of the individuals and entities named below is c/o SCWorx Corp., 100 S Ashley Dr, Suite 100 Tampa, FL 33602.

Represents beneficial ownership of less than 1% of our outstanding stock.

In determining beneficial ownership of our common stock as of a given date, the number of shares shown includes shares of common stock that may be acquired upon the exercise of stock options within 60 days of March 31, 2026.

In determining the percent of common stock owned by a person or entity on March 31, 2026, (a) the numerator is the number of shares of the class beneficially owned by such person or entity, including shares which may be acquired within 60 days of March 31, 2026 upon the exercise of stock options, and (b) the denominator is the sum of (i) the total shares of common stock outstanding on March 31, 2026 and (ii) the total number of shares that the beneficial owner may acquire upon exercise of stock options within 60 days March 31, 2026.

Unless otherwise indicated, the address of each of the individuals and entities named below is c/o SCWorx Corp., 35 Village Rd.

Suite 100, Middleton, MA 01949.

Certain Relationships and Related

2 unchanged sentences

At December 31, 2025 and 2024

Company had aged payables that were due to officers in the amount of $149,838.

the Company had a payable due to an officer in the amount of $149,838 for contract work performed prior to becoming an officer.

During September 2021, the

Company’s former CEO (also a significant shareholder) advanced $100,000 in cash to the Company for short term capital requirements.

This amount is non-interest bearing and payable upon demand.

The Company had balances of $67,622 included in shareholder advance on the

Company’s consolidated balance sheets as of December 31, 2024 and 2023.

Company’s former CEO and shareholder advanced $100,000 in cash to the Company for short term capital requirements.

This amount is

non-interest bearing and payable upon demand.

As of December 31, 2025, all amounts owed have been remitted.

The Company had a balance

of $67,622 included in shareholder advance on the Company’s consolidated balance sheets as of December 31, 2024.

Between January 18, 2024 and

July 11, 2024, the Company’s CFO advanced an aggregate $128,479 in cash to the Company for short term capital requirements.

December 31, 2024, all advanced amounts have been repaid.

December 31, 2024, all advanced amounts had been repaid.

The above amounts and terms

are not necessarily indicative of what third parties would agree to.

Director Independence

43 unchanged sentences

Audit fees for 2025 and 2024

include amounts related to the audit of our annual consolidated financial statements and quarterly review of the consolidated financial

statements included in our Quarterly Reports on Form 10-Q.

include amounts related to the audit of our annual consolidated financial statements reported on Form 10-K, quarterly review

of the consolidated financial statements included in our Quarterly Reports on Form 10-Q and review of registration statements

filed on Form S-1.

Audit Related Fees

55 unchanged sentences

Report of Independent Registered Accounting Firm (PCAOB ID Number 6920 ) F-2

Consolidated balance sheets as of December 31, 2024 and 2023 F-4

C onsolidated balance sheets as of December 31, 2025 and 2024 F-5

Consolidated statements of operations for the years ended December 31, 2025 and 2024 F-6

2 unchanged sentences

Notes to consolidated financial statements F-9

of Independent Registered Public Accounting Firm

Report of Independent Registered Public Accounting Firm

To the Board of Directors and

1 unchanged sentence

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of SCWorx Corp.

(the Company) as of December 31, 2024 and 2023, and the related consolidated statements of operations,

changes in stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2024, and the related

notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material

respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows

for each of the years in the two-year period ended December 31, 2024, in conformity with accounting principles generally accepted in the

United States of America.

Substantial Doubt about the Company’s

ability to Continue as a Going Concern

The accompanying financial statements have been

prepared assuming that the Company will continue as a going concern.

As discussed in Note 2, the Company has incurred net losses and working

capital deficits.

These factors, and the need for additional financing in order for the Company to meet its business plans raises substantial

doubt about the Company’s ability to continue as a going concern.

Our opinion is not modified with respect to that matter.

We have audited the accompanying consolidated balance sheets of SCWorx Corp.

(the Company) as of December 31, 2025 and 2024, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2025, and the related notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are

required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and

regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the

standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial

statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged

to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding

of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess

the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond

to those risks.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating

the overall presentation of the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below

are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to

the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our

especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion

on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions

on the critical audit matters or on the accounts or disclosures to which they relate.

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Impairment of Goodwill

As described in Note 3 to the Company’s

financial statements, the Company evaluates Goodwill for impairment at least once annually or more frequently if events or circumstances

indicate that the goodwill might be impaired.

The Company first assesses qualitative factors to determine whether it is necessary to perform

the quantitative analysis.

If, after assessing the totality of events or circumstances, the Company determines that it is not more likely

than not that the fair value of a reporting unit is less than its carrying value then quantitative goodwill impairment test is unnecessary.

As described in Note 5 to the Company’s financial statements, the Company evaluates Goodwill for impairment at least once annually or more frequently if events or circumstances indicate that the goodwill might be impaired.

The Company first assesses qualitative factors to determine whether it is necessary to perform the quantitative analysis.

If, after assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying value then quantitative goodwill impairment test is unnecessary.

The goodwill balance was $5,842,433 related to the SaaS reporting unit.

The Company uses the discounted cash flow model to estimate

the fair value of the SaaS reporting unit, which requires management to make subjective estimates and assumptions related to forecasts

of future revenues.

Changes in these assumptions could have a significant impact on either the fair value, the amount of any impairment

charge, or both.

The fair value of the SaaS reporting unit exceeded its carrying value as of the measurement date and, therefore, no impairment

was recognized.

We identified the Company’s calculation

of the fair value of the reporting unit to assess the need for impairment as a critical audit matter.

The principal considerations

for our determination of this critical audit matter related to the high degree of subjectivity in the Company’s judgments in determining

the qualitative and quantitative factors.

Auditing these judgments and assumptions by the Company involves auditor judgment

due to the nature and extent of audit evidence and effort required to address these matters.

The primary procedures we performed to address

these critical audit matters included the following:

The Company uses the discounted cash flow model to estimate the fair value of the SaaS reporting unit, which requires management to make subjective estimates and assumptions related to forecasts of future revenues.

Changes in these assumptions could have a significant impact on either the fair value, the amount of any impairment charge, or both.

The fair value of the SaaS reporting unit exceeded its carrying value as of the measurement date and, therefore, no impairment was recognized.

We identified the Company’s calculation of the fair value of the reporting unit to assess the need for impairment as a critical audit matter.

The principal considerations for our determination of this critical audit matter related to the high degree of subjectivity in the Company’s judgments in determining the qualitative and quantitative factors.

Auditing these judgments and assumptions by the Company involves auditor judgment due to the nature and extent of audit evidence and effort required to address these matters.

The primary procedures we performed to address these critical audit matters included the following:

- We obtained Management’s calculations, forecasts, and conclusion and performed the following procedures:

o Reviewed calculations and forecasts, and evaluated the reasonableness of Management’s calculation,

forecast, and significant assumptions used by the Company, specifically related to revenue growth.

o Reviewed calculations and forecasts, and evaluated the reasonableness of Management’s calculation, forecast, and significant assumptions used by the Company, specifically related to revenue growth.

o Performed a sensitivity analysis on key inputs.

o Recalculated management’s fair value of the reporting unit.

o Developed a range of independent estimates of the fair value of the reporting unit and compared to the

fair value determined by Management.

o Developed a range of independent estimates of the fair value of the reporting unit and compared to the fair value determined by Management.

Valuation of Warrants and Allocation of Proceeds to Convertible Notes Payable

As described in Note 9 to the Company’s financial statements, the Company issued warrants in connection with convertible notes payable during the year.

The Company is required to estimate the fair value of the warrants at issuance, with the relative fair value allocated between the warrants and the debt instrument, resulting in the recognition of a debt discount.

The fair value of the warrants issued was significantly higher than the debt proceeds received, resulting in a 100% debt discount.

The estimation of the fair value of the warrants requires management to make significant assumptions, including those related to volatility, expected term, risk-free interest rate, and other inputs used in valuation models.

Changes in these assumptions could have a significant impact on the fair value of the warrants and the resulting debt discount.

We identified the valuation of the warrants and the related debt discount as a critical audit matter.

The principal considerations for our determination of this critical audit matter were the high degree of subjectivity involved in evaluating the assumptions used in the valuation model, as well as the complexity of the accounting for the warrants and allocation of proceeds.

Auditing these assumptions required a high degree of auditor judgment and specialized knowledge.

The primary procedures we performed to address this critical audit matter included the following:

● We obtained management’s analysis and valuation of the warrants and performed the following procedures:

o Tested Management’s classification, by evaluating the technical terms.

o Evaluated the appropriateness of the valuation methodology used by the Company.

o Assessed the reasonableness of significant assumptions, including volatility, expected term, and risk-free interest rate.

o Tested the completeness and accuracy of the underlying data used in the valuation.

o Recalculated the fair value of the warrants using management’s assumptions.

● We evaluated the accounting treatment and allocation of proceeds between the debt and warrants, including the resulting recognition of the debt discount.

Valuation and Accounting for the Warrant Inducement

As described in Note 9 to the Company’s financial statements, the Company entered into a warrant inducement transaction in September 2025, whereby certain holders of equity-classified warrants were granted additional warrants to incentivize the settlement of out of the money warrants.

The Company is required to estimate the incremental fair value of the newly issued warrants compared to the original warrants at the date of exercise.

Because the inducement was offered to specific holders to raise capital rather than as a pro-rata distribution to all shareholders, the incremental fair value was recognized as a non-cash inducement expense.

The estimation of the fair value of the warrants requires management to make significant assumptions, including those related to volatility, expected term, risk-free rate, and other inputs used valuation models.

Changes in these assumptions could have a significant impact on the fair value of the warrants and the resulting inducement expense.

We identified the accounting for the warrant inducement and the measurement of the incremental fair value as a critical audit matter.

The principal consideration for our determination of this critical audit matter was the high degree of subjectivity involved in evaluating the assumptions used in the valuation models, as well as the complexity of the accounting for the inducement under ASU 2021-04 and ASC 470.

Auditing these assumptions and the classification of the transaction required a high degree of auditor judgement and specialized knowledge.

The primary procedures we performed to address this critical audit matter included the following:

● We obtained management’s analysis and valuation of the warrant inducement and performed the following procedures:

o Tested Management’s classification, by evaluating the contractual terms of the inducement offer and the underlying financial instrument, and the Company’s relationship with the Holders to verify the appropriate classification as an inducement expense, rather than a deemed dividend.

o Evaluated the appropriateness of the valuation methodology used by the Company to determine the incremental fair value of the sweetener warrants.

o Assessed the reasonableness of significant assumptions, including volatility, expected term, and risk-free interest rate.

o Tested the completeness and accuracy of the underlying data used in the valuation.

o Recalculated the incremental fair value of the warrants using management’s assumptions on the date of issuance.

● We evaluated the accounting treatment and under ASU 2021-04 and ASC-470, including the impact of the inducement on the consolidated statement of operations and the related disclosures in the financial statements.

Astra Audit & Advisory LLC

We have served as the Company’s auditor since 2024.

3 unchanged sentences

Current assets:

Cash $ 1,644,439 $ 106,654

Accounts receivable, net 313,350 372,716

1 unchanged sentence

Total current assets 2,023,416 503,378

Property and equipment, net 10,220 -

Intangible assets 20,019 -

Goodwill 5,842,433 5,842,433

Total assets $ 7,896,088 $ 6,345,811

LIABILITIES AND STOCKHOLDERS’ EQUITY

4 unchanged sentences

Deferred revenue 158,750 354,083

Convertible loans payable, net of discounts - current portion 1,539 -

Loans payable - 27,369

1 unchanged sentence

Long-term liabilities:

Loans payable, net of current maturities

Convertible loans payable, net of discounts - 19,660

5 unchanged sentences

900,000 shares authorized;

39,810 shares issued and outstanding at December 31, 2024 and 2023

39,810 shares issued and outstanding 40 40

Common stock, $ 0.001 par value;

3 unchanged sentences

Accumulated deficit ( 35,420,175 ) ( 30,976,066 )

( 30,976,066 )

( 29,839,841 )

Total stockholders’ equity 7,152,492 4,489,602

4 unchanged sentences

For the Years Ended

Revenue $ 2,877,629 $ 2,989,599

Cost of revenue 1,957,923 2,243,614

Gross profit 919,706 745,985

Operating expenses:

1 unchanged sentence

Salaries and wages 513,727 268,399

Stock compensation

General and administrative 853,343 756,115

Depreciation 404 -

Total operating expenses 1,878,425 2,005,411

Loss from operations ( 958,719 ) ( 1,259,426 )

( 1,259,426 )

( 1,450,662 )

Other income (expense)

Interest expense ( 2,985,597 ) ( 104,201 )

Gain on forgiveness of accounts payable

Impairment of goodwill

( 2,524,034 )

Total other income (expense)

( 2,530,482 )

Warrant modification expense ( 565,277 ) -

Gain of forgiveness of accounts payable 143,588 227,402

Loss on shares issued for legal settlement ( 78,104 ) -

Total other (expense) income ( 3,485,390 ) 123,201

Net loss before income taxes ( 4,444,109 ) ( 1,136,225 )

( 1,136,225 )

( 3,981,144 )

Provision for (benefit from) income taxes - -

$ ( 1,136,225 )

$ ( 3,981,144 )

Net loss $ ( 4,444,109 ) $ ( 1,136,225 )

Net loss per share, basic and diluted $ ( 0.61 ) $ ( 0.78 )

4 unchanged sentences

Preferred Stock

Additional paid-in

Subscriptions

Year ended December 31, 2025

Balances, December 31, 2024 39,810 $ 40 1,859,525 $ 1,859 $ 35,463,769 $ ( 30,976,066 ) $ 4,489,602

$ ( 29,839,841 )

Shares issued as settlement of accounts payable

Shares issued for legal settlement - - 601,250 601 361,409 - 362,010

Shares issued for vested restricted stock units

Shares issued for common stock placement – net of offering costs of $ 32,000

Shares issued for conversion of convertible loans and interest - - 7,690,059 7,690 2,903,789 - 2,911,479

Issuance of warrants in conjunction with convertible loans - - - - 1,385,000 - 1,385,000

( 1,136,225 )

Shares issued for the exercise of warrants - - 5,676,000 5,676 1,816,353 - 1,822,029

Warrant modification - - - - 565,277 - 565,277

Stock based compensation - - - - 61,204 - 61,204

Net loss - - - - - ( 4,444,109 ) ( 4,444,109 )

Ending balance, December 31, 2025 39,810 $ 40 15,826,834 $ 15,826 $ 42,556,801 $ ( 35,420,175 ) $ 7,152,492

$ ( 30,976,066 )

Preferred Stock

Subscriptions

Year ended December 31, 2024

Balances, December 31, 2023 39,810 $ 40 1,232,333 $ 1,232 $ 33,692,018 $ ( 29,839,841 ) $ 3,853,449

$ ( 25,858,697 )

Shares issued as settlement of accounts payable - - 157,639 158 271,673 - 271,831

Shares issued under equity line of credit

Shares issued for legal settlement - - 235,328 235 359,112 - 359,347

Shares issued for vested restricted stock units - - 1,667 2 ( 2 ) - -

Shares issued for settlement of class action

Shares issued for cashless exercise of warrants

Proceeds received from potential acquisition

Stock based compensation

( 3,981,144 )

Shares issued for common stock placement – net of offering costs of $ 32,000 - - 232,558 232 167,768 - 168,000

Issuance of warrants in conjunction with convertible loans - - - - 973,200 973,200

Net loss - - - - - ( 1,136,225 ) ( 1,136,225 )

Ending balance, December 31, 2024 39,810 $ 40 1,859,525 $ 1,859 $ 35,463,769 $ ( 30,976,066 ) $ 4,489,602

$ ( 29,839,841 )

The accompanying notes are an integral part

3 unchanged sentences

Cash flows from operating activities:

$ ( 1,136,225 )

$ ( 3,981,144 )

Net loss $ ( 4,444,109 ) $ ( 1,136,225 )

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

Impairment of goodwill

Amortization of debt discount 2,601,165 49,660

Stock-based compensation

Depreciation 404 -

Loss on shares issued for legal settlement 78,104 -

Gain on forgiveness of accounts payable ( 143,588 ) ( 227,402 )

Warrant modification expense 565,277 -

Stock based compensation 61,204 -

Common stock issued for settlement of payables - 271,831

7 unchanged sentences

Net cash used in operating activities ( 1,543,610 ) ( 1,084,292 )

( 1,084,292 )

Net cash from investing activities:

Proceeds from potential acquisition

Net cash provided by investing activities

Cash flows from investing activities:

Additions to intangible assets ( 20,019 ) -

Purchase of fixed assets ( 10,624 ) -

Net cash used in investing activities:

Cash flows from financing activities:

Proceeds from the sale of common stock

Proceeds from loans payable

Proceeds from the sale of common stock, net - 168,000

Proceeds from loans payable, net 1,385,000 994,500

Payments on loans payable ( 27,369 ) ( 62,990 )

Payments of shareholder advance

Proceeds from the exercise of warrants, net of costs 1,822,029 -

Payments on shareholder advance ( 67,622 ) -

Proceeds from accounts payable and accrued liabilities - related party - 128,479

1 unchanged sentence

Net cash provided by financing activities 3,112,038 1,099,510

Net increase (decrease) in cash

Net increase in cash 1,537,785 15,218

Cash, beginning of period 106,654 91,436

5 unchanged sentences

Shares issued for vested restricted stock units $ - $ 2

Shares issued for settlement of class action

Shares issued for cashless exercise of warrants

Shares issued for conversion of convertible loans and interest $ 2,911,479 $ -

Shares issued for accrued legal settlement $ 283,906 $ 285,294

Warrants issued in conjunction with convertible loans $ 1,385,000 $ 973,200

Warrants issued in conjunction with inducement agreement $ 565,277 $ -

The accompanying notes are an integral part

1 unchanged sentence

Notes to Consolidated Financial Statements

Years ended December 31, 2025 and 2024

Description of Business

Nature of Business

SCWorx, LLC (n/k/a SCW FL

Corp.) (“SCW LLC”) was a privately held limited liability company which was organized in Florida on November 17, 2016.

On December 31, 2017, SCW LLC acquired Primrose Solutions, LLC (“Primrose”), a Delaware limited liability company, which

became its wholly-owned subsidiary and focused on developing functionality for the software now used and sold by SCWorx Corp.

“Company” or “SCWorx”).

The majority interest holders of Primrose were interest holders of SCW LLC and based

upon Staff Accounting Bulletin Topic 5G, the technology acquired has been accounted for at predecessor cost of $ 0 .

To facilitate the

planned acquisition by Alliance MMA, Inc., a Delaware corporation (“Alliance”), on June 27, 2018, SCW LLC merged with

and into a newly-formed entity, SCWorx Acquisition Corp., a Delaware corporation (“SCW Acquisition”), with SCW

Acquisition being the surviving entity.

SCWorx, LLC (n/k/a SCW FL Corp.) (“SCW LLC”) was a privately held limited liability company which was organized in Florida on November 17, 2016.

On December 31, 2017, SCW LLC acquired Primrose Solutions, LLC (“Primrose”), a Delaware limited liability company, which became its wholly-owned subsidiary and focused on developing functionality for the software now used and sold by SCWorx Corp.

(the “Company” or “SCWorx”).

The majority interest holders of Primrose were interest holders of SCW LLC and based upon Staff Accounting Bulletin Topic 5G, the technology acquired has been accounted for at predecessor cost of $ 0 .

To facilitate the planned acquisition by Alliance MMA, Inc., a Delaware corporation (“Alliance”), on June 27, 2018, SCW LLC merged with and into a newly-formed entity, SCWorx Acquisition Corp., a Delaware corporation (“SCW Acquisition”), with SCW Acquisition being the surviving entity.

Subsequently, on August 17, 2018, SCW Acquisition changed its name to SCWorx Corp.

2018, the Company began to collect subscriptions for common stock.

From June to November 2018, the Company collected $ 1,250,000 in

subscriptions and issued 3,125 shares of common stock to new third-party investors.

On November 30, 2018, the Company and certain of

its stockholders agreed to cancel 6,510 shares of common stock.

In June 2018, the Company began to collect subscriptions for common stock.

From June to November 2018, the Company collected $ 1,250,000 in subscriptions and issued 3,125 shares of common stock to new third-party investors.

On November 30, 2018, the Company and certain of its stockholders agreed to cancel 6,510 shares of common stock.

In addition, on February 1, 2019, (i) SCWorx Corp.

(f/k/a SCWorx

Acquisition Corp.) changed its name to SCW FL Corp.

(to allow Alliance to change its name to SCWorx Corp.) and (ii) Alliance

acquired SCWorx Corp.

(n/k/a SCW FL Corp.) in a stock-for-stock exchange transaction and changed Alliance’s name to SCWorx

Corp., which is the Company’s current name, with SCW FL Corp.

(f/k/a SCWorx Acquisition Corp.) changed its name to SCW FL Corp.

(to allow Alliance to change its name to SCWorx Corp.) and (ii) Alliance acquired SCWorx Corp.

(n/k/a SCW FL Corp.) in a stock-for-stock exchange transaction and changed Alliance’s name to SCWorx Corp., which is the Company’s current name, with SCW FL Corp.

becoming the Company’s subsidiary.

On October 6, 2023, following

stockholder approval at the Company’s annual meeting, the Company amended its certificate of incorporation to implement a 1 for

15 reverse split of its common stock.

The effect of the reverse stock split was to combine every 15 shares of outstanding common stock

into one share of common stock.

The reverse stock split was effective at the opening of the trading day on October 11, 2023.

The effects of the reverse

stock split have been reflected in this Annual Report on Form 10-K for all periods presented.

Operations of the Business

SCWorx is a provider of data

content and services related to the repair, normalization and interoperability of information for healthcare providers and big data analytics

for the healthcare industry.

SCWorx has developed and markets

health information technology solutions and associated services that improve healthcare processes and information flow within hospitals.

SCWorx’s software platform enables healthcare providers to simplify, repair, and organize its data (“data normalization”),

allows the data to be utilized across multiple internal software applications (“interoperability”) and provides the basis

for sophisticated data analytics (“big data”).

SCWorx’s solutions are designed to improve the flow of information quickly

and accurately between the existing supply chain, electronic medical records, clinical systems, and patient billing functions.

is designed to achieve multiple operational benefits such as supply chain cost reductions, decreased accounts receivables aging, accelerated

and more accurate billing, contract optimization, increased supply chain management and cost visibility, synchronous Charge Description

Master (“CDM”) and control of vendor rebates and contract administration fees.

SCWorx empowers healthcare

providers to maintain comprehensive access and visibility to an advanced business intelligence that enables better decision-making and

reductions in product costs and utilization, ultimately leading to accelerated and accurate patient billing.

SCWorx’s software modules

perform separate functions as follows:

SCWorx is a provider of data content and services related to the repair, normalization and interoperability of information for healthcare providers and big data analytics for the healthcare industry.

SCWorx has developed and markets health information technology solutions and associated services that improve healthcare processes and information flow within hospitals.

SCWorx’s software platform enables healthcare providers to simplify, repair, and organize its data (“data normalization”), allows the data to be utilized across multiple internal software applications (“interoperability”) and provides the basis for sophisticated data analytics (“big data”).

SCWorx’s solutions are designed to improve the flow of information quickly and accurately between the existing supply chain, electronic medical records, clinical systems, and patient billing functions.

The software is designed to achieve multiple operational benefits such as supply chain cost reductions, decreased accounts receivables aging, accelerated and more accurate billing, contract optimization, increased supply chain management and cost visibility, synchronous Charge Description Master (“CDM”) and control of vendor rebates and contract administration fees.

SCWorx empowers healthcare providers to maintain comprehensive access and visibility to an advanced business intelligence that enables better decision-making and reductions in product costs and utilization, ultimately leading to accelerated and accurate patient billing.

SCWorx’s software modules perform separate functions as follows:

● virtualized Item Master File repair, expansion and automation;

5 unchanged sentences

● data integration and warehousing.

SCWorx continues to provide

transformational data-driven solutions to some of the finest, most well-respected healthcare providers in the United States.

geographically dispersed throughout the country.

The Company’s focus is to assist healthcare providers with issues they have pertaining

to data interoperability.

SCWorx continues to provide transformational data-driven solutions to some of the finest, most well-respected healthcare providers in the United States.

Clients are geographically dispersed throughout the country.

The Company’s focus is to assist healthcare providers with issues they have pertaining to data interoperability.

SCWorx provides these solutions through a combination of direct sales and relationships with strategic partners.

SCWorx’s software solutions

are delivered to clients within a fixed term period, typically a three-to-five-year contracted term, where such software is hosted in

SCWorx data centers (Amazon Web Service’s “AWS” or RackSpace) and accessed by the client through a secure connection

in a software as a service (“SaaS”) delivery method.

SCWorx currently sells its

solutions and services in the United States to hospitals and health systems through its direct sales force and its distribution and reseller

partnerships.

Note 2 – Liquidity and Going Concern

The accompanying consolidated

financial statements have been prepared in accordance with U.S.

generally accepted accounting principles (“U.S.

GAAP”), which

contemplates continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal

course of business.

The consolidated financial statements do not include any adjustment that might become necessary should the Company

be unable to continue as a going concern.

The Company has suffered recurring

losses from operations and incurred a net loss of $ 1,136,225 for the year ended December 31, 2024 and $ 3,981,144 for the year ended December

The accumulated deficit as of December 31, 2024 was $ 30,976,066 .

The Company has not yet achieved profitability and expects

to continue to incur cash outflows from operations.

It is expected that its operating losses will continue and, as a result, the Company

will eventually need to generate significant increases in product revenues to achieve profitability.

These conditions indicate that there

is substantial doubt about the Company’s ability to continue as a going concern within one year after the consolidated financial

statement issuance date.

SCWorx’s software solutions are delivered to clients within a fixed term period, typically a three-to-five-year contracted term, where such software is hosted in SCWorx data centers (Amazon Web Service’s “AWS” or RackSpace) and accessed by the client through a secure connection in a software as a service (“SaaS”) delivery method.

SCWorx currently sells its solutions and services in the United States to hospitals and health systems through its direct sales force and its distribution and reseller partnerships.

Summary of Significant Accounting Policies

Basis of Presentation and Principles of

Consolidation

The accompanying consolidated

financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S.

and the rules and regulations of the U.S.

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S.

GAAP”) and the rules and regulations of the U.S.

Securities and Exchange Commission (“SEC”).

The accompanying consolidated

financial statements include the accounts of SCWorx and its wholly-owned subsidiaries.

All material intercompany balances and transactions

have been eliminated in consolidation.

Cash is maintained with various

financial institutions.

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally

of cash deposits.

The accompanying consolidated financial statements include the accounts of SCWorx and its wholly-owned subsidiaries.

All material intercompany balances and transactions have been eliminated in consolidation.

Cash is maintained with various financial institutions.

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 .

The Company did not have any amounts in excess of the FDIC insured limit for as of December 31, 2024 and 2023.

The Company had amounts in excess of the FDIC insured limit of $ 1,356,754 as of December 31, 2025.

The Company did not have any amounts in excess of the FDIC insured limit for as of December 31, 2024.

Fair Value of Financial Instruments

Management applies fair value

accounting for significant financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed

at fair value in the consolidated financial statements.

Management defines fair value as the price that would be received from selling

an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

When determining

the fair value measurements for assets and liabilities, which are required to be recorded at fair value, management considers the principal

or most advantageous market in which it would transact and the market-based risk measurements or assumptions that market participants

would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk.

value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and

bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Management applies fair value accounting for significant financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements.

Management defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, management considers the principal or most advantageous market in which it would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk.

Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Observable inputs other than quoted prices in

active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets,

or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or

Level 3 - Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market

participants would use in pricing the asset or liability.

Level 2 - Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

Concentration of Credit and Other Risks

Financial instruments that

potentially subject the Company to significant concentrations of credit risk consist principally of cash and accounts receivable.

Company believes that any concentration of credit risk in its accounts receivable is substantially mitigated by the Company’s evaluation

process, relatively short collection terms and the high level of credit worthiness of its customers.

The Company performs ongoing internal

credit evaluations of its customers’ financial condition, obtains deposits and limits the amount of credit extended when deemed

necessary but generally requires no collateral.

Significant customers are

those which represent more than 10% of the Company’s revenue for each period presented, or the Company’s accounts receivable

balance as of each respective consolidated balance sheet date.

For each significant customer, revenue as a percentage of total revenue

and accounts receivable as a percentage of total net accounts receivable are as follows:

For the years ended

Accounts Receivable

Allowance for Credit Losses

Accounts receivable are comprised

of amounts billed and currently due from customers.

Accounts receivable are amounts related to any unconditional right the Company has

for receiving consideration and are presented as accounts receivable in the consolidated balance sheets.

The Company maintains an allowance

for credit losses for estimated losses resulting from the inability of our customers to make required payments.

The Company employs an

expected credit loss model utilizing historical loss rates and historical trends in credit quality indicators (e.g., delinquency, risk

ratings), adjusted to reflect current economic conditions and knowledge of customer relationships.

Management considers the following

factors when determining the collectability of specific customer accounts:

customer creditworthiness, past transaction history with the

customer, current industry trends, changes in customer payment terms, and specific customer situations.

The Company’s normal collection

cycle ranges between thirty and 60 days.

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and accounts receivable.

The Company believes that any concentration of credit risk in its accounts receivable is substantially mitigated by the Company’s evaluation process, relatively short collection terms and the high level of credit worthiness of its customers.

The Company performs ongoing internal credit evaluations of its customers’ financial condition, obtains deposits and limits the amount of credit extended when deemed necessary but generally requires no collateral.

Significant customers are those which represent more than 10% of the Company’s revenue for each period presented, or the Company’s accounts receivable balance as of each respective consolidated balance sheet date.

For each significant customer, revenue as a percentage of total revenue and accounts receivable as a percentage of total net accounts receivable are as follows:

For the years ended Accounts Receivable

December 31, December 31,

Customers 2025 2024 2025 2024

Customer A 15 % 15 % 32 % 11 %

Customer B 14 % 13 % - % 18 %

Customer C 19 % 20 % 8 % 20 %

Customer D 7 % 7 % 11 % 27 %

Accounts Receivable and Allowance for Credit Losses

Accounts receivable are comprised of amounts billed and currently due from customers.

Accounts receivable are amounts related to any unconditional right the Company has for receiving consideration and are presented as accounts receivable in the consolidated balance sheets.

The Company maintains an allowance for credit losses for estimated losses resulting from the inability of our customers to make required payments.

The Company employs the practical expedient to estimate expected credit losses for current accounts receivable by utilizing subsequent cash collections.

The evaluation of subsequent cash collections was performed through March 20, 2026, for the annual reporting period ended December 31, 2025.

Management considers the following factors when determining the collectability of specific customer accounts:

customer creditworthiness, past transaction history with the customer, current industry trends, changes in customer payment terms, and specific customer situations.

The Company’s normal collection cycle ranges between thirty and 60 days.

Estimated uncollectible amounts are charged to earnings and a credit to a valuation allowance.

Balances which remain outstanding after reasonable collection efforts are written off through a charge to the valuation allowance and

a credit to accounts receivable.

The Company recorded an allowance for credit losses of $ 20,000 as of December 31, 2024.

The Company has

assessed all receivables are collectable and did not record an allowance for credit losses as of December 31, 2023.

The Company determines if an

arrangement is a lease at inception.

The current portion of lease obligations are included in accounts payable and accrued liabilities

on the consolidated balance sheets.

Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset

for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.

As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information

available at commencement date in determining the present value of lease payments.

The Company’s lease terms may include options

to extend or terminate the lease, which are included in the lease ROU asset when it is reasonably certain that the Company will exercise

Balances which remain outstanding after reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable.

The Company recorded an allowance for credit losses of $ 55,200 and $ 20,000 as of December 31, 2025 and 2024, respectively.

The Company determines if an arrangement is a lease at inception.

The current portion of lease obligations are included in accounts payable and accrued liabilities on the consolidated balance sheets.

Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.

As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The Company’s lease terms may include options to extend or terminate the lease, which are included in the lease ROU asset when it is reasonably certain that the Company will exercise that option.

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

The Company has lease agreements

with lease components only, none with non-lease components, which are generally accounted for separately (refer to Note 7, Leases, for

additional detail).

Goodwill and Impairment of Long Lived Assets

Goodwill is recorded as the

difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and identified

intangible assets acquired under a business combination.

Goodwill also includes acquired assembled workforce, which does not qualify as

an identifiable intangible asset.

The Company reviews impairment of goodwill annually in the fourth quarter, or more frequently if events

or circumstances indicate that the goodwill might be impaired.

The Company first assesses qualitative factors to determine whether it

is necessary to perform the quantitative goodwill impairment test.

If, after assessing the totality of events or circumstances, the Company

determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then the quantitative

goodwill impairment test is unnecessary.

For further discussion of goodwill,

refer to Note 5, Goodwill.

The Company has lease agreements with lease components only, none with non-lease components, which are generally accounted for separately.

Management has elected a short-term lease exception policy on all classes of underlying assets, permitting the Company to not apply the recognition requirements of this standard to short-term leases (i.e.

leases with terms of 12 months or less) (refer to Note 7, Leases, for additional detail).

Goodwill and Impairment

Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and identified intangible assets acquired under a business combination.

Goodwill also includes acquired assembled workforce, which does not qualify as an identifiable intangible asset.

The Company reviews impairment of goodwill annually in the fourth quarter, or more frequently if events or circumstances indicate that the goodwill might be impaired.

The Company first assesses qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test.

If, after assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then the quantitative goodwill impairment test is unnecessary.

For further discussion of goodwill, refer to Note 5, Goodwill.

Intangible Assets and Impairment of Long Lived Assets

The Company capitalizes costs incurred during the application development stage for internal-use software, which include external direct costs of materials and services, as well as payroll-related costs for employees directly associated with the software development.

Costs related to the preliminary project phase, training, and maintenance are expensed as incurred.

Once the software is ready for its intended use, capitalized costs are amortized on a straight-line basis over an estimated useful life of 3 to 5 years in accordance with the provisions of Accounting Standard Codification (“ASC”) 350, “ Goodwill and Other Intangible Assets ”.

The assessment of any impairment of these assets is dependent upon estimates of recoverable amounts that consider factors such as economic and market conditions and the useful lives of assets.

If, after assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of an asset is less than its carrying amount, then the company records impairment of the asset.

Revenue Recognition

The Company recognizes revenue

in accordance with Topic 606 to depict the transfer of promised goods or services in an amount that reflects the consideration to which

an entity expects to be entitled in exchange for those goods or services.

To determine revenue recognition for arrangements within the

scope of Topic 606 the Company performs the following steps:

The Company recognizes revenue in accordance with Topic 606 to depict the transfer of promised goods or services in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.

To determine revenue recognition for arrangements within the scope of Topic 606 the Company performs the following steps:

Identify the contract(s) with a customer

3 unchanged sentences

Recognize revenue when (or as) the entity satisfies a performance obligation

The Company follows the accounting

revenue guidance under Topic 606 to determine whether contracts contain more than one performance obligation.

Performance obligations

are the unit of accounting for revenue recognition and generally represent the distinct goods or services that are promised to the customer.

The Company has identified

the following performance obligations in its SaaS contracts with customers:

The Company follows the accounting revenue guidance under Topic 606 to determine whether contracts contain more than one performance obligation.

Performance obligations are the unit of accounting for revenue recognition and generally represent the distinct goods or services that are promised to the customer.

The Company has identified the following performance obligations in its SaaS contracts with customers:

1) Data Normalization:

3 unchanged sentences

In SaaS arrangements, the client cannot take possession of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades published during the subscription period,

3) Maintenance:

which includes ongoing data cleansing and normalization, content enrichment, and optimization, and

1 unchanged sentence

mainly related to specific customer projects to manage and/or analyze data and review for cost reduction opportunities.

A contract will typically include

Data Normalization, SaaS and Maintenance, which are distinct performance obligations and are accounted for separately.

The transaction

price is allocated to each separate performance obligation on a relative stand-alone selling price basis.

Significant judgement is required

to determine the stand-alone selling price for each distinct performance obligation and is typically estimated based on observable transactions

when these services are sold on a stand-alone basis.

At contract inception, an assessment of the goods and services promised in the contracts

with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer

a good or service (or bundle of goods or services).

To identify the performance obligations, the Company considers all the goods

or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices.

A contract will typically include Data Normalization, SaaS and Maintenance, which are distinct performance obligations and are accounted for separately.

The transaction price is allocated to each separate performance obligation on a relative stand-alone selling price basis.

Significant judgement is required to determine the stand-alone selling price for each distinct performance obligation and is typically estimated based on observable transactions when these services are sold on a stand-alone basis.

At contract inception, an assessment of the goods and services promised in the contracts with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer a good or service (or bundle of goods or services).

To identify the performance obligations, the Company considers all the goods or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices.

Revenue is recognized when the performance obligation has been met.

The Company considers control to have transferred upon delivery

because the Company has a present right to payment at that time, the Company has transferred use of the good or service, and the customer

is able to direct the use of, and obtain substantially all the remaining benefits from, the good or service.

The Company’s SaaS and

Maintenance contracts typically have termination for convenience without penalty clauses and accordingly, are generally accounted for

as month-to-month agreements.

If it is determined that the Company has not satisfied a performance obligation, revenue recognition will

be deferred until the performance obligation is deemed to be satisfied.

Revenue recognition for the

Company’s performance obligations are as follows:

The Company considers control to have transferred upon delivery because the Company has a present right to payment at that time, the Company has transferred use of the good or service, and the customer is able to direct the use of, and obtain substantially all the remaining benefits from, the good or service.

The Company’s SaaS and Maintenance contracts typically have termination for convenience without penalty clauses and accordingly, are generally accounted for as month-to-month agreements.

If it is determined that the Company has not satisfied a performance obligation, revenue recognition will be deferred until the performance obligation is deemed to be satisfied.

Revenue recognition for the Company’s performance obligations are as follows:

Data Normalization and Professional Services

The Company’s Data Normalization

and Professional Services are typically a fixed fee.

When these services are not combined with SaaS or Maintenance revenues as a single

unit of accounting, these revenues are recognized as the services are rendered and when contractual milestones are achieved and accepted

by the customer.

When these services are combined with SaaS or Maintenance revenues, revenues are recognized ratably over the period of

the contract.

The Company’s Data Normalization and Professional Services are typically a fixed fee.

When these services are not combined with SaaS or Maintenance revenues as a single unit of accounting, these revenues are recognized as the services are rendered and when contractual milestones are achieved and accepted by the customer.

When these services are combined with SaaS or Maintenance revenues, revenues are recognized ratably over the period of the contract.

SaaS and Maintenance

SaaS and Maintenance revenues

are recognized ratably over the contract terms beginning on the commencement date of each contract, which is the date on which the Company’s

service is made available to customers.

The Company does have some

contracts that have payment terms that differ from the timing of revenue recognition, which requires the Company to assess whether the

transaction price for those contracts include a significant financing component.

The Company has elected the practical expedient that

permits an entity to not adjust for the effects of a significant financing component if it expects that at the contract inception, the

period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service

will be one year or less.

The Company does not maintain contracts in which the period between when the entity transfers a promised good

or service to a customer and when the customer pays for that good or service exceeds the one-year threshold.

The Company has one revenue

stream, from the SaaS business, and believes it has presented all varying factors that affect the nature, timing and uncertainty of revenues

and cash flows.

SaaS and Maintenance revenues are recognized ratably over the contract terms beginning on the commencement date of each contract, which is the date on which the Company’s service is made available to customers.

The Company does have some contracts that have payment terms that differ from the timing of revenue recognition, which requires the Company to assess whether the transaction price for those contracts include a significant financing component.

The Company has elected the practical expedient that permits an entity to not adjust for the effects of a significant financing component if it expects that at the contract inception, the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less.

The Company does not maintain contracts in which the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service exceeds the one-year threshold.

The Company has one revenue stream, from the SaaS business, and believes it has presented all varying factors that affect the nature, timing and uncertainty of revenues and cash flows.

Remaining Performance Obligations

As of December 31, 2024, the

Company had $ 354,083 of remaining performance obligations recorded as deferred revenue.

The Company expects to recognize sales relating

to these existing performance obligations of during 2025.

As of December 31, 2023, the

Company had $ 378,583 of remaining performance obligations recorded as deferred revenue.

The Company recognized sales relating to those

existing performance obligations of during 2024.

Costs to Fulfill a Contract

As of December 31, 2025, the Company had $ 158,750 of remaining performance obligations recorded as deferred revenue.

The Company expects to recognize sales relating to these existing performance obligations during 2026.

As of December 31, 2024, the Company had $ 354,083 of remaining performance obligations recorded as deferred revenue.

The Company recognized sales relating to these existing performance obligations during 2025.

Costs to Fulfill a Contract

typically include costs related to satisfying performance obligations as well as general and administrative costs that are not explicitly

chargeable to customer contracts.

These expenses are recognized and expensed when incurred in accordance with ASC 340-40, “Other

Assets and Deferred Costs—Contracts with Customers” .

Costs to fulfill a contract typically include costs related to satisfying performance obligations as well as general and administrative costs that are not explicitly chargeable to customer contracts.

These expenses are recognized and expensed when incurred in accordance with ASC 340-40, “Other Assets and Deferred Costs—Contracts with Customers” .

Cost of Revenue

Cost of revenues primarily

represent data center hosting costs, consulting services and maintenance of the Company’s large data array that were incurred in

delivering professional services and maintenance of the Company’s large data array during the periods presented.

Convertible Debt and Amortization of Debt

The Company has issued various

debt instruments with warrants and conversion features for which total proceeds were allocated to individual instruments based on the

relative fair value of each instrument at the time of issuance.

The relative fair value of the warrants and conversion was recorded as

discount on debt and amortized over the term of the respective debt.

For the years ended December 31, 2024 and 2023, amortization of debt

discount was $ 19,660 $ 0 , respectively.

Cost of revenues primarily represent data center hosting costs, consulting services and maintenance of the Company’s large data array that were incurred in delivering professional services and maintenance of the Company’s large data array during the periods presented.

Convertible Debt and Amortization of Debt Discounts

The Company has issued various debt instruments with warrants and conversion features for which total proceeds were allocated to individual instruments based on the relative fair value of each instrument at the time of issuance.

The relative fair value of the warrants and conversion was recorded as discount on debt and amortized over the term of the respective debt.

For the years ended December 31, 2025 and 2024, amortization of debt discount was $ 2,601,165 and $ 49,660 , respectively and is included in interest expense on the Company’s consolidated statements of operations.

Contract Balances

Contract assets arise when

the revenue associated prior to the Company’s unconditional right to receive a payment under a contract with a customer ( i.e .,

unbilled revenue) and are derecognized when either it becomes a receivable or the cash is received.

There were no contract assets as of

December 31, 2024 and 2023.

Contract liabilities arise

when customers remit contractual cash payments in advance of the Company satisfying its performance obligations under the contract and

are derecognized when the revenue associated with the contract is recognized when the performance obligation is satisfied.

Contract liabilities

were $ 354,083 and $ 378,583 as of December 31, 2024 and 2023, respectively.

The Company uses the asset

and liability method of accounting for income taxes in accordance with ASC Topic 740, “ Income Taxes .” Under this method,

income tax expense is recognized for the amount of:

(i) taxes payable or refundable for the current year and (ii) deferred tax consequences

of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns.

tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary

differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized

in the results of operations in the period that includes the enactment date.

Valuation allowances are provided

if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

As of December 31, 2024 and 2023, the Company has evaluated available evidence and concluded that the Company may not realize all the

benefits of its deferred tax assets;

Contract assets arise when the revenue associated prior to the Company’s unconditional right to receive a payment under a contract with a customer ( i.e ., unbilled revenue) and are derecognized when either it becomes a receivable or the cash is received.

There were no contract assets as of December 31, 2025 and 2024.

Contract liabilities arise when customers remit contractual cash payments in advance of the Company satisfying its performance obligations under the contract and are derecognized when the revenue associated with the contract is recognized when the performance obligation is satisfied.

Contract liabilities were $ 158,750 and $ 354,083 as of December 31, 2025 and 2024, respectively.

The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “ Income Taxes .” Under this method, income tax expense is recognized for the amount of:

(i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date.

Valuation allowances are provided if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

As of December 31, 2025 and 2024, the Company has evaluated available evidence and concluded that the Company may not realize all the benefits of its deferred tax assets;

therefore, a valuation allowance has been established for its deferred tax assets.

ASC Topic 740-10-30 clarifies

the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold

and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a

ASC Topic 740-10-40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods,

disclosure, and transition.

ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.

ASC Topic 740-10-40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

The Company has no material uncertain tax positions for any of the reporting periods presented.

Stock-Based Compensation

The Company accounts for stock-based

compensation expense in accordance with the authoritative guidance on share-based payments.

Under the provisions of the guidance, stock-based

compensation expense is measured at the grant date based on the fair value of the option or warrant using a Black-Scholes option pricing

model and is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period.

The authoritative guidance

also requires that the Company measures and recognizes stock-based compensation expense upon modification of the term of stock award.

The stock-based compensation expense for such modification is accounted for as a repurchase of the original award and the issuance of

Calculating stock-based compensation

expense requires the input of highly subjective assumptions, including the expected term of the stock-based awards, stock price volatility,

and the pre-vesting option forfeiture rate.

The Company estimates the expected life of options granted based on historical exercise patterns,

which are believed to be representative of future behavior.

The Company estimates the volatility of the Company’s common stock on

the date of grant based on historical volatility.

The assumptions used in calculating the fair value of stock-based awards represent the

Company’s best estimates, but these estimates involve inherent uncertainties and the application of management’s judgment.

As a result, if factors change and the Company uses different assumptions, its stock-based compensation expense could be materially different

in the future.

In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares

expected to vest.

The Company estimates the forfeiture rate based on historical experience of its stock-based awards that are granted,

exercised and cancelled.

If the actual forfeiture rate is materially different from the estimate, stock-based compensation expense could

be significantly different from what was recorded in the current period.

The Company also grants performance based restricted stock awards

to employees and consultants.

These awards will vest if certain employee\consultant-specific or company-designated performance targets

are achieved.

If minimum performance thresholds are achieved, each award will convert into a designated number of the Company’s

common stock.

The Company accounts for stock-based compensation expense in accordance with the authoritative guidance on share-based payments.

Under the provisions of the guidance, stock-based compensation expense is measured at the grant date based on the fair value of the option or warrant using a Black-Scholes option pricing model and is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period.

The authoritative guidance also requires that the Company measures and recognizes stock-based compensation expense upon modification of the term of stock award.

The stock-based compensation expense for such modification is accounted for as a repurchase of the original award and the issuance of a new award.

Calculating stock-based compensation expense requires the input of highly subjective assumptions, including the expected term of the stock-based awards, stock price volatility, and the pre-vesting option forfeiture rate.

The Company estimates the expected life of options granted based on historical exercise patterns, which are believed to be representative of future behavior.

The Company estimates the volatility of the Company’s common stock on the date of grant based on historical volatility.

The assumptions used in calculating the fair value of stock-based awards represent the Company’s best estimates, but these estimates involve inherent uncertainties and the application of management’s judgment.

As a result, if factors change and the Company uses different assumptions, its stock-based compensation expense could be materially different in the future.

In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares expected to vest.

The Company estimates the forfeiture rate based on historical experience of its stock-based awards that are granted, exercised and cancelled.

If the actual forfeiture rate is materially different from the estimate, stock-based compensation expense could be significantly different from what was recorded in the current period.

The Company also grants performance based restricted stock awards to employees and consultants.

These awards will vest if certain employee\consultant-specific or company-designated performance targets are achieved.

If minimum performance thresholds are achieved, each award will convert into a designated number of the Company’s common stock.

If minimum performance thresholds are not achieved, then no shares will be issued.

Based upon the expected levels of achievement,

stock-based compensation is recognized on a straight-line basis over the requisite service period.

The expected levels of achievement

are reassessed over the requisite service periods and, to the extent that the expected levels of achievement change, stock-based compensation

is adjusted in the period of change and recorded on the consolidated statements of operations and the remaining unrecognized stock-based

compensation is recorded over the remaining requisite service period.

Based upon the expected levels of achievement, stock-based compensation is recognized on a straight-line basis over the requisite service period.

The expected levels of achievement are reassessed over the requisite service periods and, to the extent that the expected levels of achievement change, stock-based compensation is adjusted in the period of change and recorded on the consolidated statements of operations and the remaining unrecognized stock-based compensation is recorded over the remaining requisite service period.

Refer to Note 9, Stockholders’ Equity, for additional detail.

Loss Per Share

The Company computes earnings

(loss) per share in accordance with ASC 260, “ Earnings per Share ” which requires presentation of both basic and diluted

earnings (loss) per share (“EPS”) on the face of the consolidated income statement.

Basic EPS is computed by dividing the

loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period.

Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible

preferred stock using the if-converted method.

In computing diluted EPS, the average stock price for the period is used in determining

the number of shares assumed to be purchased from the exercise of stock options or warrants and the exercise of fully vested restricted

The Company computes earnings (loss) per share in accordance with ASC 260, “ Earnings per Share ” which requires presentation of both basic and diluted earnings (loss) per share (“EPS”) on the face of the consolidated income statement.

Basic EPS is computed by dividing the loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period.

Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method.

In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants and the exercise of fully vested restricted stock units.

Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

As of December 31, 2024 and 2023, the

Company had 9,048,072 and 180,390 , respectively, common stock equivalents outstanding.

As of December 31, 2025 and 2024, the Company had 54,177,461 and 9,038,072 , respectively, common stock equivalents outstanding.

Indemnification

The Company provides indemnification

of varying scope to certain customers against claims of intellectual property infringement made by third parties arising from the use

of the Company’s software.

In accordance with authoritative guidance for accounting for guarantees, the Company evaluates estimated

losses for such indemnification.

The Company considers such factors as the degree of probability of an unfavorable outcome and the ability

to make a reasonable estimate of the amount of loss.

To date, no such claims have been filed against the Company and no liability has

been recorded in its consolidated financial statements.

As permitted under Delaware

law, the Company has agreements whereby it indemnifies its officers and directors for certain events or occurrences while the officer

or director is, or was, serving at the Company’s request in such capacity.

The maximum potential amount of future payments the Company

could be required to make under these indemnification agreements is unlimited.

In addition, the Company has directors’ and

officers’ liability insurance coverage that is intended to reduce its financial exposure and may enable it to recover any payments

above the applicable policy retention.

The Company provides indemnification of varying scope to certain customers against claims of intellectual property infringement made by third parties arising from the use of the Company’s software.

In accordance with authoritative guidance for accounting for guarantees, the Company evaluates estimated losses for such indemnification.

The Company considers such factors as the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss.

To date, no such claims have been filed against the Company and no liability has been recorded in its consolidated financial statements.

As permitted under Delaware law, the Company has agreements whereby it indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity.

The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited.

In addition, the Company has directors’ and officers’ liability insurance coverage that is intended to reduce its financial exposure and may enable it to recover any payments above the applicable policy retention.

Contingencies

The Company records a liability

when the Company believes that it is both probable that a loss has been incurred, and the amount can be reasonably estimated.

If the Company

determines that a loss is reasonably possible, and the loss or range of loss can be estimated, the Company discloses the possible loss

in the notes to the consolidated financial statements.

The Company reviews the developments in its contingencies that could affect the

amount of the provisions that has been previously recorded, and the matters and related possible losses disclosed.

The Company adjusts

provisions and changes to its disclosures accordingly to reflect the impact of negotiations, settlements, rulings, advice of legal counsel,

and updated information.

The Company records a liability when the Company believes that it is both probable that a loss has been incurred, and the amount can be reasonably estimated.

If the Company determines that a loss is reasonably possible, and the loss or range of loss can be estimated, the Company discloses the possible loss in the notes to the consolidated financial statements.

The Company reviews the developments in its contingencies that could affect the amount of the provisions that has been previously recorded, and the matters and related possible losses disclosed.

The Company adjusts provisions and changes to its disclosures accordingly to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and updated information.

Significant judgment is required to determine both the probability and the estimated amount.

Legal costs associated with

loss contingencies are accrued based upon legal expenses incurred by the end of the reporting period.

Legal costs associated with loss contingencies are accrued based upon legal expenses incurred by the end of the reporting period.

Use of Estimates

The preparation of consolidated

financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the amounts reported

and disclosed in the consolidated financial statements and accompanying notes.

The Company regularly evaluates estimates and assumptions

related to the allowance for credit losses, the estimated useful lives and recoverability of long-lived assets, equity component of convertible

debt, stock-based compensation, and deferred income tax asset valuation allowances.

The Company bases its estimates and assumptions on

current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results

of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses

that are not readily apparent from other sources.

The actual results experienced by the Company may differ materially and adversely from

the Company’s estimates.

To the extent there are material differences between the estimates and the actual results, future results

of operations will be affected.

The preparation of consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes.

The Company regularly evaluates estimates and assumptions related to the allowance for credit losses, the estimated useful lives and recoverability of long-lived assets, equity component of convertible debt, stock-based compensation, and deferred income tax asset valuation allowances.

The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.

The actual results experienced by the Company may differ materially and adversely from the Company’s estimates.

To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Actual results could differ materially from those estimates.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the

Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date.

If not discussed,

management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the

Company’s consolidated financial statements upon adoption.

In November 2023, the FASB

issued ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures to enhance the reportable segment disclosures.

The guidance requires additional disclosures about significant segment expenses.

The guidance is effective for the public companies with

fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 with early adoption

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date.

If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s consolidated financial statements upon adoption.

In June 2022, the FASB issued Accounting Standards Update (“ASU”) 2022-03, Fair Value Measurement (Topic 820), “ Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ,” which clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair values;

it also requires additional disclosures, including the nature and remaining duration of such restrictions.

The guidance is effective for fiscal years beginning after December 15, 2023, with early application permitted.

The adoption did not have an impact on its consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, “ Financial Instruments—Credit Losses (Topic 326):

Measurements of Credit Losses for Accounts Receivable and Contract Assets ” (“ASU 2025-05”).

The amendments in this update provide a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under FASB ASC 606.

Under ASU 2025-05, an entity is required to disclose whether it has elected to use the practical expedient.

ASU 2025-05 is effective for annual periods, including interim reporting periods within annual reporting periods, beginning after December 15, 2025 with early adoption permitted.

The Company has chosen to Adopt this standard as of December 31, 2025.

The adoption did not have an impact on its consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, “ Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity ”.

The new guidance is intended to simplify the accounting for certain convertible instruments with characteristics of both liability and equity.

The guidance removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments.

As a result, after the adoption of this guidance, an entity’s convertible debt instrument will be wholly accounted for as debt.

The guidance also expands disclosure requirements for convertible instruments and simplifies areas of the guidance for diluted earnings-per-share calculations by requiring the use of the if-converted method.

The guidance was effective for fiscal years beginning after December 15, 2021, and can be adopted on either a fully retrospective or modified retrospective basis.

The Company adopted this standard effective December 31, 2025, using the fully retrospective approach.

The adoption did not have an impact on its consolidated financial statements.

In March 2024, the FASB issued ASU 2024-01, “ Compensation - Stock Compensation (Topic 718):

Scope application for profits interest and similar awards ” (“ASU 2024-01”).

This update adds an illustrative example to demonstrate how an entity should apply the scope guidance to determine whether profits interest and similar awards (“profits interest awards”) should be accounted for in accordance with Topic 718.

ASU 2024-01 is effective for fiscal years beginning after December 15, 2025 or the interim period in which the Company loses emerging growth company status.

Early adoption is permitted.

ASU 2024-01 should be applied retrospectively to all prior periods presented in the financial statements or prospectively.

The Company has chosen to adopt this standard for the year ended December 31, 2025.

The adoption did not have an impact on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-04, “ Debt-Debt with Conversions and Other Options ”.

ASU 2024-04 is intended to clarify requirements for determining whether certain settlements of convertible debt instruments, including convertible debt instruments with cash conversion features or convertible debt instruments that are not currently convertible, should be accounted for as an induced conversion.

This ASU is effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted.

The Company has chosen to adopt this standard for the year ended December 31, 2025.

The adoption did not have an impact on its consolidated financial statements.

Related Party Transactions

At December 31, 2024 and 2023,

the Company had amounts due to officers in the amount of $ 149,838 .

During September 2021, the

Company’s former CEO (also a significant shareholder) advanced $ 100,000 in cash to the Company for short term capital requirements.

At December 31, 2025 and 2024 the Company had a payable due to an officer in the amount of $ 149,838 for contract work performed prior to becoming an officer.

During September 2021, the Company’s former CEO and shareholder advanced $ 100,000 in cash to the Company for short term capital requirements.

This amount is non-interest bearing and payable upon demand.

The Company had balances of $ 67,622 included in stockholder advance on the

Company’s consolidated balance sheets as of December 31, 2024 and 2023.

Between January 18, 2024 and

July 11, 2024, the Company’s CFO advanced an aggregate $ 128,479 in cash to the Company for short term capital requirements.

December 31, 2024, all advanced amounts have been repaid.

The above amounts and terms

are not necessarily what third parties would agree to.

During the year ended December

31, 2023, the Company determined that the fair value of its goodwill was less than its carrying value.

The Company determined the carrying

value to be $ 5,842,433 as of December 31, 2023 and recognized impairment expense $ 2,524,034 .

There were no changes to the

carrying value of goodwill for the year ended December 31, 2024.

As of December 31, 2025, all amounts owed have been remitted.

The Company had a balance of $ 67,622 included in shareholder advance on the Company’s consolidated balance sheets as of December 31, 2024.

Between January 18, 2024 and July 11, 2024, the Company’s CFO advanced an aggregate $ 128,479 in cash to the Company for short term capital requirements.

As of December 31, 2024, all advanced amounts had been repaid.

The above amounts and terms are not necessarily indicative of what third parties would agree to.

Intangible Assets

The Company capitalizes costs associated with software developed for internal use, including payroll for employees directly involved in development and external consulting fees, once the project has reached the application development stage in accordance with ASC 350-40.

Amortization is computed using the straight-line method over an estimated useful life of 3 – 5 years.

During the year ended December 31, 2025, the Company capitalized $ 20,019 in costs related to new software development.

The Company is still in the development phase and the asset has not yet been put into service.

Therefore, no amortization of the asset has occurred as of the date of these consolidated financial statements.

On February 1, 2019, the Company’s shareholders exchanged all of its outstanding shares in exchange for 5,263,158 shares of Alliance common stock.

Due to the Company’s shareholders acquiring a controlling interest in Alliance after acquisition, the transaction was treated as a reverse merger for accounting purposes, with SCWorx being the reporting company.

The acquisition was accounted for under the acquisition method of accounting with an initial goodwill value of $ 8,366,467 .

During the year ended December 31, 2023, the Company determined the fair value of its goodwill to be less than its carrying value and recognized impairment expense $ 2,524,034 .

There were no changes to the carrying value of goodwill for the years ended December 31, 2025 and 2024.

Receipt of CARES funding

On May 5, 2020, the Company

obtained a $ 293,972 unsecured loan payable through the Paycheck Protection Program (“PPP”), which was enacted as part of the

Coronavirus Aid, Relief and Economic Security Act (the “CARES ACT”).

The funds were received from Bank of America through

a loan agreement pursuant to the CARES Act.

The CARES Act was established in order to enable small businesses to pay employees during

the economic slowdown caused by COVID-19 by providing forgivable loans to qualifying businesses for up to 2.5 times their average monthly

payroll costs.

The amount borrowed under the CARES Act and used for payroll costs, rent, mortgage interest, and utility costs during the

24 week period after the date of loan disbursement is eligible to be forgiven provided that (a) the Company uses the PPP Funds during

the eight week period after receipt thereof, and (b) the PPP Funds are only used to cover payroll costs (including benefits), rent, mortgage

interest, and utility costs.

While the full loan amount may be forgiven, the amount of loan forgiveness will be reduced if, among other

reasons, the Company does not maintain staffing or payroll levels or less than 60 % of the loan proceeds are used for payroll costs.

and interest payments on any unforgiven portion of the PPP Funds (the “PPP Loan”) will be deferred to the date the SBA remits

the borrower’s loan forgiveness amount to the lender or, if the borrower does not apply for loan forgiveness, 10 months after the

end of the borrower’s loan forgiveness period for six months and will accrue interest at a fixed annual rate of 1.0 % and carry a

two year maturity date.

On May 5, 2020, the Company obtained a $ 293,972 unsecured loan payable through the Paycheck Protection Program (“PPP”), which was enacted as part of the Coronavirus Aid, Relief and Economic Security Act (the “CARES ACT”).

The funds were received from Bank of America through a loan agreement pursuant to the CARES Act.

The CARES Act was established in order to enable small businesses to pay employees during the economic slowdown caused by COVID-19 by providing forgivable loans to qualifying businesses for up to 2.5 times their average monthly payroll costs.

The amount borrowed under the CARES Act and used for payroll costs, rent, mortgage interest, and utility costs during the 24 week period after the date of loan disbursement is eligible to be forgiven provided that (a) the Company uses the PPP Funds during the eight week period after receipt thereof, and (b) the PPP Funds are only used to cover payroll costs (including benefits), rent, mortgage interest, and utility costs.

While the full loan amount may be forgiven, the amount of loan forgiveness will be reduced if, among other reasons, the Company does not maintain staffing or payroll levels or less than 60 % of the loan proceeds are used for payroll costs.

Principal and interest payments on any unforgiven portion of the PPP Funds (the “PPP Loan”) will be deferred to the date the SBA remits the borrower’s loan forgiveness amount to the lender or, if the borrower does not apply for loan forgiveness, 10 months after the end of the borrower’s loan forgiveness period for nine months and will accrue interest at a fixed annual rate of 1.0 % and carry a two year maturity date.

There is no prepayment penalty on the CARES Act Loan.

In May 2022, the Company was granted an extension on the

maturity date of this note until March 5, 2025 .

The loan was partially forgiven in the amount of $ 139,596 in September 2022 with the balance

remaining due.

At December 31, 2024 and 2023, the principal balances on the loan were $ 27,369 and 90,359 , respectively and are included

in the Company’s consolidated balance sheets.

In May 2022, the Company was granted an extension on the maturity date of this note until May 5, 2025 .

The loan was partially forgiven in the amount of $ 139,569 in September 2022.

As of December 31, 2025 and December 31, 2024, the remaining balance was $ 0 and $ 27,369 , respectively.

Short Term Loans

On April 12, 2024, the Company

issued a secured promissory note in the face amount of $ 330,000 , in exchange for which it received cash in the amount of $ 300,000 .

addition to the original issue discount of $ 30,000 , the note bears interest at the rate of 5 % per annum, was originally due May 10,

2024 and subsequently extended until July 12, 2024 and is secured by all the Company assets.

On July 15, 2024, the balance of the promissory

note was rolled into a new convertible loan offering.

On April 12, 2024, the Company issued a secured promissory note in the face amount of $ 330,000 , in exchange for which it received cash in the amount of $ 300,000 .

In addition to the original issue discount of $ 30,000 , the note bears interest at the rate of 5 % per annum, was originally due May 10, 2024 and subsequently extended until July 12, 2024 and is secured by all the Company assets.

On July 15, 2024, the balance of the promissory note was rolled into a new convertible loan offering.

Convertible Loans

On July 15, 2024, the Company

issued an aggregate $ 1,155,000 in convertible notes bearing interest at 10 % per annum.

The notes mature on December 31,

2025 and is convertible, into the Company’s common stock at a price of $ 1.43 per share, subject to certain adjustments,

at the holder’s request.

The noteholders and certain third parties were also granted detachable 5 year warrants

to purchase an aggregate of 4,887,118 shares of the Company’s common stock at exercise prices ranging from $ 1.43 to

$ 1.692 per share.

On July 15, 2024, the Company issued an aggregate $ 1,155,000 in convertible notes bearing interest at 10 % per annum.

The notes mature on December 31, 2025 and are convertible into the Company’s common stock at a price of $ 1.43 per share, subject to certain adjustments, at the holder’s request.

The noteholders and certain third parties were also granted detachable 5 year warrants to purchase an aggregate of 4,887,118 shares of the Company’s common stock at exercise prices ranging from $ 1.43 to $ 1.692 per share.

The Company valued the warrants at $ 6,163,572 using the Black-Scholes pricing model.

The Company has

allocated the note proceeds based on relative fair value and has recorded the value of the warrants as a discount to the debt in the amount

of $ 973,200 .

At December 31, 2024, the principal balances were still outstanding and is included on the Company’s consolidated

balance sheets net of discounts at $ 19,660 .

The Company has accrued interest for the notes in the amount of $ 53,950 , which is included

in accounts payable and accrued liabilities on the Company’s consolidated balance sheets.

The Company recognized amortization expense

of $ 19,660 during the year ended December 31, 2024.

The Company has recorded the value of the warrants as a discount to the debt in the amount of $ 973,200 .

The notes and warrants included in this offering contain beneficial ownership limitations as to each holder of 4.99 % as well as anti-dilution provisions.

As of December 31, 2025, all principal amounts had been repaid.

As of December 31, 2024, the full $ 1,155,000 in principal was outstanding and is included in convertible loans payable, net of discounts on the Company’s consolidated balance sheets.

On January 21, 2025, the Company issued an aggregate $ 1,500,000 in convertible notes bearing interest at 10 % per annum.

The notes mature on January 21, 2027 and are convertible into the Company’s common stock at a price of $ 1.25 per share, subject to certain adjustments, at the holder’s request.

The noteholders and certain third parties were also granted detachable 5 year warrants to purchase an aggregate of 7,256,364 shares of the Company’s common stock at exercise prices ranging from $ 1.25 to $ 1.65 per share.

The Company valued the warrants at $ 11,422,792 using the Black-Scholes pricing model.

The Company has recorded the value of the warrants as a discount to the debt in the amount of $ 1,385,000 .

Additionally, the Company recorded debt issuance costs of $ 115,000 as a discount to the debt.

The notes and warrants included in this offering contain beneficial ownership limitations as to each holder of 4.99 % as well as anti-dilution provisions.

At December 31, 2025, $ 35,714 of the principal balances remain outstanding and are included on the Company’s consolidated balance sheets net of discounts at $ 1,539 .

The Company has accrued interest for the above notes in the amount of $ 146,116 and $ 53,950 as of December 31, 2025 and 2024, respectively, which is included in accounts payable and accrued liabilities on the Company’s consolidated balance sheets.

The Company recognized amortization expense on debt discounts of $ 2,601,165 and $ 49,660 during the years ended December 31, 2025 and 2024, respectively and is included in interest expense in the Company’s consolidated statements of operations.

Operating Leases

The Company’s principal

executive office in Tampa Florida is under a month-to-month arrangement with a base rent of $ 250 per month.

The Company has operating leases

for corporate, business and technician offices.

Leases with a probable term of 12 months or less, including month-to-month agreements,

are not recorded on the consolidated balance sheets, unless the arrangement includes an option to purchase the underlying asset, or an

option to renew the arrangement, that the Company is reasonably certain to exercise (short-term leases).

The Company recognizes lease

expense for these leases on a straight-line bases over the lease term.

The Company’s only remaining lease is month-to-month.

a practical expedient, the Company elected, for all office and facility leases, not to separate non-lease components (common-area maintenance

costs) from lease components (fixed payments including rent) and instead to account for each separate lease component and its associated

non-lease components as a single lease component.

For the years ended December

31, 2024 and 2023, the components of lease expense were as follows:

The Company’s principal executive office in Middleton Massachusetts is under a one year arrangement with a base rent of $ 990 per month running from November1, 2025 through October 31, 2026.

The Company has operating leases for corporate, business and technician offices.

Leases with a probable term of 12 months or less, including month-to-month agreements, are not recorded on the consolidated balance sheets, unless the arrangement includes an option to purchase the underlying asset, or an option to renew the arrangement, that the Company is reasonably certain to exercise (short-term leases).

The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

As a practical expedient, the Company elected, for all office and facility leases, not to separate non-lease components (common-area maintenance costs) from lease components (fixed payments including rent) and instead to account for each separate lease component and its associated non-lease components as a single lease component.

For the years ended December 31, 2025 and 2024, the components of lease expense were as follows:

For the years ended

1 unchanged sentence

Total lease cost $ 6,042 $ 4,080

As of December 31, 2024 and

2023, the Company has no additional operating leases, and no financing leases.

As of December 31, 2025 and 2024, the Company has no additional operating leases, and no financing leases.

Commitments and Contingencies

In conducting its business,

the Company may become involved in legal proceedings.

The Company will accrue a liability for such matters when it is probable that a

liability has been incurred and the amount can be reasonably estimated.

When only a range of possible loss can be established, the most

probable amount in the range is accrued.

If no amount within this range is a better estimate than any other amount within the range, the

minimum amount in the range is accrued.

The accrual for a litigation loss contingency might include, for example, estimates of potential

damages, outside legal fees and other directly related costs expected to be incurred.

CorProminence d/b/a Core IR v.

AAA Arbitration Case 01-22-0001-5709

As previously disclosed in

the Company’s periodic reports filed with the SEC, on April 25, 2022, the Company received a Demand for Arbitration along with a

Statement of Claim filed by Core IR with the American Arbitration Association seeking damages in the amount of approximately $ 190,000 .

out of a marketing and consulting agreement.

The Company filed its answer, affirmative defenses and counterclaims on May 16, 2022.

order of the arbitrator dated November 1, 2022, Core IR received permission to amend its Statement of Claim to increase its request for

damages to $ 257,546 .

The Company received the final decision of the Arbitrator on October 16, 2023, awarding Core IR $ 461,856 including

unpaid compensation, indemnification for legal fees and costs, prevailing party legal fees and interest (the “Award”).

IR has since obtained a judgement in the amount of approximately $ 502,000 (including interest) (“Judgement”) which is included

in accounts payable and accrued liabilities on the Company’s consolidated balance sheets at December 31, 2023.

The Company and Core

IR entered into a settlement agreement dated July 12, 2024 under which the Company agreed to issue Core IR shares of its common stock

with a value of $ 502,000 (determined based on sales proceeds realized by Core IR), in full and complete satisfaction of the Judgement.

The settlement agreement is filed as exhibit 10.5 to the annual report on Form 10-K as filed with the SEC on September 24, 2024.

18, 2024, the Company issued 159,776 shares of its common stock in the first tranche of payments under this agreement.

In connection with the Settlement

Agreement, the Company and Core IR entered into a Registration Rights Agreement, pursuant to which the Company was required to file a

resale registration statement with the Commission to register for resale the shares issuable upon under the Settlement Agreement as described

Hadrian Equities Partners, LLC et ano.

22-cv-07096 (JLR) (S.D.N.Y)

On August 19, 2022, Hadrian

Equities Partners, LLC and the Phillip W.

2007 Irrevocable Trust filed a complaint in the United States District Court for

the Southern District of New York alleging that SCWorx was dilatory and did not comply with its alleged contractual duties to remove the

restrictions from Plaintiffs’ converted AMMA stock to SCWorx stock until August 10 and August 11, 2020.

Plaintiffs allege that as

a result, they were unable to sell their SCWorx stock when SCWorx was trading at its highest price on April 13, 2020.

The Complaint sought

$ 500,000 in damages.

Plaintiffs filed an Amended Complaint on November 28, 2022.

On February 6, 2023, SCWorx filed its answer to

the Amended Complaint interposing numerous defenses.

Plaintiff has since entered into a settlement agreement dated December 1, 2023 (effective

as of October 23, 2023) (as amended April 29, 2024), under which the Company agreed to pay Plaintiffs $ 20,000 and issue them 37,500 shares

of common stock, all in full settlement of the claims made in the lawsuit.

The Company has accrued for this liability which is included

in accounts payable and accrued liabilities on the Company’s consolidated balance sheet at December 31, 2023.

The cash payment was

made in July 2024, and the shares were issued in May 2024.

Contract Commitments

On February 5, 2024, the

Company entered into a 120 day agreement with a registered broker in which it agreed to pay a 6 % commission to the broker for any capital

raised from parties introduced by the broker.

Following the expiration of the first 120 days, the Company remains obligated to pay the

commission of all capital or debt proceeds received from parties introduced by the broker during the original term of the agreement for

a period of time.

These obligations currently expire on or around July 17, 2025.

In conducting its business, the Company may become involved in legal proceedings.

The Company will accrue a liability for such matters when it is probable that a liability has been incurred and the amount can be reasonably estimated.

When only a range of possible loss can be established, the most probable amount in the range is accrued.

If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued.

The accrual for a litigation loss contingency might include, for example, estimates of potential damages, outside legal fees and other directly related costs expected to be incurred.

Nasdaq minimum bid price deficiency notification

As Previously Disclosed in the Company’s periodic report filed with the SEC on April 16, 2025, Nasdaq notified the Company that based upon the Company’s closing bid price for the last 30 consecutive business days (February 26, 2025 through April 9, 2025), the Company no longer meets the listed securities requirement to maintain a minimum bid price of $ 1 per share pursuant to Nasdaq Rules 5550(a)(2) and 5810(c)(3)(A).

On October 8, 2025, the Company received written notification from the Listing Qualifications Department of Nasdaq, granting the Company’s request for a 180-day extension to regain compliance with the Bid Price Rule.

The Company now has until April 6, 2026 to meet the requirement.

Under the Nasdaq Rules, if at any time during this 180 day period the closing bid price of the Company’s securities is at least $ 1 for a minimum of ten consecutive business days, Nasdaq will provide written confirmation of compliance and the matter would be closed.

In the event that the Company does not regain compliance during the initial 180 day period, the Company may still be eligible for additional time.

To qualify, the Company would be required to meet the continued listing requirements for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the bid price requirement, and would need to provide written notice of its intention to cure the deficiency during the second compliance period, by effecting a reverse stock split, if necessary.

If the Company meets these additional requirements, Nasdaq will inform the Company that it has been granted an additional 180 calendar days.

However, if it appears to the Nasdaq staff that the Company will not be able to cure the deficiency, or if the Company is not otherwise eligible, Nasdaq would then provide notice that the Company’s securities will be subject to delisting.

The Company is monitoring its Common Stock trading price.

If compliance with the minimum bid price requirement is not regained within the extended 180-day period, the Company will implement a reverse stock split within the range previously approved by its shareholders.

Loan Commitments

On July 15, 2024, the Company issued an aggregate $ 1,155,000 in

senior secured convertible notes.

Between July 15, 2024 and January 17, 2025, the Company issued an aggregate $ 2,655,000 in senior secured convertible notes.

Under these notes, the Company has pledged all assets of the Company as collateral.

for further details.

Debt for further details.

Stockholders’ Equity

Authorized Shares

The Company has 45,000,000

Common shares authorized and 5,000,000 preferred shares, of which 900,000 have been designated Series A convertible preferred shares and

have been authorized with a par value of $ 0.001 per share.

On October 6, 2023, following

stockholder approval at the Company’s annual meeting, the Company amended its certificate of incorporation to implement a 1 for

15 reverse split of its common stock.

The effect of the reverse stock split was to combine every 15 shares of outstanding common stock

into one share of common stock.

The reverse stock split was effective at the opening of the trading day on October 11, 2023.

effects of the reverse stock split have been reflected in this Annual report on form 10/K for all periods presented.

Issuance of Shares for Vested Restricted Stock

March 27, 2024, the Company

issued 1,667 shares of common stock to a holder of fully vested restricted stock units.

Issuance of Shares as Settlement of Accounts

February 6, 2024 and July 11, 2024, the Company issued an aggregate 130,039 shares of common stock in full settlement of $ 239,815 of

accounts payable.

The shares had fair values ranging from $ 1.20 to $ 2.65 per share.

October 24, 2024, the Company issued 27,600 shares of common stock in full settlement of $ 32,016 of accounts payable.

shares had a fair value of $ 1.16 per share.

On December 8, 2025, the Company amended its certificate of incorporation to increase the aggregate number of shares issuable to 155,000,000 consisting of the following:

150,000,000 shares of Common Stock, $ 0.001 par value per share;

5,000,000 shares of Preferred Stock, $ 0.001 par value per share available for designation

The Company currently has 150,000,000 common shares and has 900,000 Series A convertible preferred shares authorized designated with a par value of $ 0.001 per share.

Issuance of Shares for Legal Settlements

On May 30, 2024, the Company

issued 37,500 shares of common stock valued at $ 87,600 or $ 2.34 per share to fulfill its obligation under a previous legal settlement.

Commitments and Contingencies for further information.

On July 15, 2024, the Company

issued 38,052 shares of common stock valued at $ 53,653 or $ 1.41 per share to settle a potential legal claim.

On July 18, 2024, the Company

issued 159,776 shares of common stock valued at $ 218,094 or $ 1.36 per share as partial fulfillment of its obligation under a previous

legal settlement.

Commitments and Contingencies for further information.

Issuance of Shares and Warrants for Stock Purchase

Between November 18, 2024

and November 19, 2024, SCWorx Corp.

entered into a Securities Purchase Agreement (“ SPA ”) with certain accredited investors

(the “ Investors ”), and, pursuant to the SPA, sold to the Investors an aggregate 232,558 shares of its common stock

and warrants to acquire up to an aggregate 232,558 additional shares of the Company’s common stock for gross proceeds of $ 200,000 .

The exercise price of the warrants is $ 0.86 per share, subject to certain adjustments.

On March 14, 2025, the Company issued 191,250 shares of common stock valued at $ 148,410 or $ 0.78 per share as partial fulfillment of its obligation under a previous legal settlement.

On May 1, 2025, the Company issued 230,000 shares of common stock valued at $ 138,000 or $ 0.60 per share as partial fulfillment of its obligation under a previous legal settlement.

On May 21, 2025, the Company issued 180,000 shares of common stock valued at $ 75,600 or $ 0.42 per share as partial fulfillment of its obligation under a previous legal settlement.

Issuance of Shares for Note Conversions

Between February 3, 2025 and February 27, 2025, the Company issued an aggregate 54,980 shares of common stock for the conversion of an aggregate $ 40,000 in principal and $ 7,283 in interest due under the Company’s senior secured convertible notes.

Between April 2, 2025 and June 17, 2025, the Company issued an aggregate 3,904,803 shares of common stock for the conversion of an aggregate $ 1,386,071 in principal and $ 162,768 in interest due under the Company’s senior secured convertible notes.

Between July 28, 2025 and August 26, 2025, the Company issued an aggregate 3,278,331 shares of common stock for the conversion of an aggregate $ 1,100,214 in principal and $ 57,143 in interest due under the Company’s senior secured convertible notes.

On October 6, 2025, the Company issued an aggregate 451,945 shares of common stock for the conversion of $ 93,000 in principal and $ 65,000 in accrued interest on the Company’s senior secured convertible notes.

Issuance of Shares for Warrant Exercises

On September 17, 2025, the Company issued an aggregate 1,954,816 shares of common stock for the exercise of warrants for which it received aggregate net proceeds of $ 702,166 .

Due to certain ownership limitations, an aggregate 109,184 shares of common stock are held in abatement to be issued at a later time.

The shares held in abatement were later issued on November 6, 2025.

On November 6, 2025, the Company issued an aggregate 3,612,000 shares of common stock for the exercise of warrants for which it received aggregate net of $ 1,119,864 .

Warrants issued in conjunction with inducement agreements

On September 17, 2025, and in conjunction with the above warrant exercises, the Company entered into a series of inducement agreements whereby it issued warrants to purchase an aggregate 4,128,000 shares of the Company’s common stock at an exercise price of $ 0.31 per share.

The Company has accounted for the inducement agreement transaction as a modification of the warrants exercised.

The Company valued the 2,064,000 warrants exercised at $ 488,150 and the newly issued warrants at $ 1,053,427 using the Black-Scholes pricing model.

The excess value related to the new warrants issued is $ 565,277 and is included in the Company’s consolidated statements of operations as warrant modification expense.

Warrants issued in conjunction with loans payable

On July 15, 2024, the Company

issued warrants to purchase an aggregate 4,887,118 shares of the Company’s common stock at exercise prices ranging from $ 1.43 to

$ 1.573 per share in conjunction with a convertible note issuance, see Note 4.

Loans Payable.

The warrants were valued at $ 6,163,572 using

the Black-Scholes pricing model.

On January 21, 2025, the Company issued warrants to purchase an aggregate 7,256,364 shares of the Company’s common stock at exercise prices ranging from $ 1.25 to $ 1.65 per share in conjunction with a convertible note issuance, see Note 6.

The warrants were valued at $ 11,422,792 using the Black-Scholes pricing model.

The Company has recognized $ 1,385,000 of this value as a discount to the associated notes.

The Company has classified

the warrants as having Level 2 inputs, and has used the Black-Scholes option-pricing model to value the warrants.

The fair values at the commitment

date for the warrants were based upon the following management assumptions as of the date of issuance:

The Company has classified the warrants as having Level 2 inputs, and has used the Black-Scholes option-pricing model to value the warrants.

The fair values at the commitment date for the warrants detailed above were based upon the following management assumptions as of the date of issuance:

Risk-free interest rate 3.62 - 4.40 %

3 unchanged sentences

Stock Incentive Plan

The number of shares of the

Company’s common stock that are issuable pursuant to warrant and stock option grants with time-based vesting as of and for the year

ended December 31, 2024 are:

Warrant Grants

Stock Option Grants

exercise price per

The number of shares of the Company’s common stock that are issuable pursuant to warrant and stock option grants with time-based vesting as of and for the year ended December 31, 2025 were:

Warrant Grants Stock Option Grants Restricted Stock

warrants Weighted-

share Number of

options Weighted-

share Number of

Balance at December 31, 2024 8,915,798 $ 0.92 - $ - 122,274

Granted 50,818,459 0.31 - - -

Exercised ( 5,676,000 ) 0.31 - - -

Cancelled/Expired ( 3,070 ) 60.00 - - -

1 unchanged sentence

Exercisable at December 31, 2025 35,089,096 $ 0.33 - $ - 122,274

The number of shares of the

Company’s common stock that are issuable pursuant to warrant and stock option grants with time-based vesting as of and for the year

ended December 31, 2023 are:

Warrant Grants

Stock Option Grants

The number of shares of the Company’s common stock that are issuable pursuant to warrant and stock option grants with time-based vesting as of and for the year ended December 31, 2024 were:

Warrant Grants Stock Option Grants Restricted

warrants Weighted-

exercise price per

share Number of

options Weighted-

exercise price per

share Number of

Balance at December 31, 2023 11,394 $ 58.72 3,333 $ 39.60 165,663

Granted 8,906,697 0.86 - - 151,290

Exercised - - - - ( 152,957 )

Cancelled/Expired ( 2,293 ) 53.64 ( 3,333 ) 39.60 ( 41,722 )

1 unchanged sentence

Exercisable at December 31, 2024 8,915,798 $ 0.92 - $ - 122,274

The Company has classified

the warrant as having Level 2 inputs, and has used the Black-Scholes option-pricing model to value the warrant.

The Company’s outstanding

warrants at December 31, 2024 are as follows:

The Company’s outstanding warrants at December 31, 2025 are as follows:

Warrants Outstanding Warrants Exercisable

Exercise Price Range Number Outstanding Weighted Average Remaining Contractual Life

Exercise Price

Outstanding Weighted Average

Contractual Life

(in years) Weighted

Average Exercise Price Number Exercisable Weighted Average Exercise Price Intrinsic Value

Exercise Price Number

Exercisable Weighted

Exercise Price Intrinsic

$0.31 - $60.00 54,055,187 3.79 $ 0.32 35,089,096 $ 0.32 -

of December 31, 2024 and 2023, there was no unrecognized expense for unvested stock options and restricted stock awards.

Stock-based compensation expense

for the years ended December 31, 2024 and 2023 was as follows:

The Company’s outstanding warrants and options at December 31, 2024 are as follows:

Warrants Outstanding Warrants Exercisable

Exercise Price

Outstanding Weighted Average

Contractual Life

(in years) Weighted

Exercise Price Number

Exercisable Weighted

Exercise Price Intrinsic

$0.86 – $60.00 8,915,798 4.55 $ 0.92 8,915,798 $ 0.95 $ 7,400,859

As of December 31, 2025 and 2024, there was no unrecognized expense for unvested stock options and restricted stock awards.

For the years ended

Stock-based compensation expense $ 61,203 $ -

Stock-based compensation expense

categorized by the equity components for the years ended December 31, 2024 and 2023 is as follows:

Stock-based compensation expense categorized by the equity components for the years ended December 31, 2025 and 2024 is as follows:

For the years ended

compensation is included on the consolidated statements of operations.

Common stock $ 61,203 $ -

Total $ 61,203 $ -

Stock compensation is included on the consolidated statements of operations.

Net Loss Per Share

Basic net loss per share is

computed by dividing net loss for the period by the weighted average shares of common stock outstanding during each period.

loss per share is computed by dividing net loss for the period by the weighted average shares of common stock, common stock equivalents

and potentially dilutive securities outstanding during each period.

The Company uses the treasury stock method to determine whether there

is a dilutive effect of outstanding option grants.

The following securities were

excluded from the computation of diluted net loss per share for the periods presented because including them would have been anti-dilutive:

Basic net loss per share is computed by dividing net loss for the period by the weighted average shares of common stock outstanding during each period.

Diluted net loss per share is computed by dividing net loss for the period by the weighted average shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period.

The Company uses the treasury stock method to determine whether there is a dilutive effect of outstanding option grants.

The following securities were excluded from the computation of diluted net loss per share for the periods presented because including them would have been anti-dilutive:

For the years ended

Stock options - -

Warrants 54,055,187 8,915,798

Restricted stock units 122,274 122,274

Total common stock equivalents 54,177,461 9,038,072

By virtue of a merger of the

limited liability company into a corporation, the Company became a corporation during 2018.

The significant items comprising

the Company’s net deferred taxes as of December 31, 2024 and 2023 are as follows:

The significant items comprising the Company’s net deferred taxes as of December 31, 2025 and 2024 are as follows:

As of December 31,

2 unchanged sentences

Deferred revenue 274,366 318,610

Other 1,185,473

Valuation allowance ( 13,380,053 ) ( 12,378,275 )

( 12,378,275 )

( 12,126,468 )

Total deferred tax asset - -

2 unchanged sentences

Net deferred tax asset (liability) $ - $ -

The components of the provision

for (benefit from) income taxes consist of the following:

The components of the provision for (benefit from) income taxes consist of the following:

As of December 31,

Federal $ - $ -

Total $ - $ -

Deferred tax:

$ ( 233,463 )

$ ( 915,543 )

Federal $ ( 928,450 ) $ ( 233,463 )

State ( 73,328 ) ( 18,344 )

change in valuation allowance 1,001,778 251,807

The provision for (benefit

from) income taxes varies from the amount computed by applying the statutory rate for reasons summarized below:

Total $ - $ -

The provision for (benefit from) income taxes varies from the amount computed by applying the statutory rate for reasons summarized below:

As of December 31,

1 unchanged sentence

Net loss before tax per financial statements $ ( 4,444,109 ) $ ( 1,136,225 )

$ ( 1,136,225 )

$ ( 3,981,144 )

Statutory rate ( 933,263 ) 21.00 % ( 238,607 ) 21.00 %

1 unchanged sentence

Permanent items 4,813 ( 0.11 )% 5,548 0.49 %

Rate change - 0.00 % - 0.00 %

Change in valuation allowance 1,001,778 ( 22.54 )% 251,807 ( 22.16 )%

As of December 31, 2024 and

2023, the Company had federal net operating loss carryforwards of approximately $ 39.9 million and $ 38.8 million, respectively, available

to offset future taxable income.

As of December 31, 2024 and 2023, the Company had state loss carry-forwards of approximately $ 19.3 million

and $ 18.2 million, respectively.

Future utilization of net operating losses may be limited due to potential ownership changes under Section

382 of the Internal Revenue Code of 1986, as amended (the “Code”).

The federal net operating loss carryforwards can be carried

forward indefinitely and state loss carryforwards begin to expire in 2039.

The valuation allowance as

of December 31, 2024 and 2023 was $ 12,378,275 and $ 12,126,468 , respectively.

The net change in valuation allowance for the years ended

December 31, 2024 and 2023 was an increase of $ 251,807 and $ 987,478 , respectively.

In assessing the realizability of deferred tax assets,

management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized.

The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in

which those temporary differences become deductible.

Management considers the scheduled reversal of deferred income tax liabilities, projected

future taxable income, and tax planning strategies in making this assessment.

Based on consideration of these items, management has determined

that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full

valuation allowance as of December 31, 2024 and 2023.

The Company had no unrecognized

tax benefits during 2024 or 2023.

By statute, all tax years are open to examination by the major taxing jurisdictions to which the Company

$ - 0.00 % $ - 0.00 %

As of December 31, 2025 and 2024, the Company had federal net operating loss carryforwards of approximately $ 41.9 million and $ 38.8 million, respectively, available to offset future taxable income.

As of December 31, 2025 and 2024, the Company had state loss carry-forwards of approximately $ 20.3 million and $ 19.3 million, respectively.

Future utilization of net operating losses may be limited due to potential ownership changes under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”).

The federal net operating loss carryforwards can be carried forward indefinitely and state loss carryforwards begin to expire in 2039.

The valuation allowance as of December 31, 2025 and 2024 was $ 13,380,053 and $ 12,378,275 , respectively.

The net change in valuation allowance for the years ended December 31, 2025 and 2024 was an increase of $ 1,001,778 and $ 251,807 , respectively.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized.

The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.

Based on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full valuation allowance as of December 31, 2025 and 2024.

As of December 31, 2025, the Company has not filed federal or state tax returns for the years beginning 2020 through 2025.

The Company plans to work with external tax advisors to prepare and submit these returns.

The company has evaluated the potential tax exposure and believes there to be no liability due to the Company’s sustained losses.

However, the final tax liability could differ from the amounts currently recorded.

The Company does not believe the outcome will have a material adverse effect on its overall financial position.

The Company had no unrecognized tax benefits during 2025 or 2024.

By statute, all tax years are open to examination by the major taxing jurisdictions to which the Company is subject.

Segment Reporting

As noted above, the Company

is a provider of data content and services related to the repair, normalization and interoperability of information for healthcare providers

and big data analytics for the healthcare industry.

The Company has determined

that it currently operates in a single segment - health information technology solutions and services, located in a single geographic

location – the United States.

The accounting policies of the segment are the same as those described in the summary of significant

accounting policies.

Since the Company operates in a single segment, the measure of segment total assets and loss from operations is the

same as that reported on the accompanying consolidated balance sheets as total assets, and the accompanying consolidated statements of

operations as loss from operations, respectively.

The Company’s Chief

Executive Officer is the Chief Operating Decision Maker (“CODM”).

The CODM manages the Company’s business activities

as a single operating and reportable segment.

The CODM uses consolidated profit and loss to evaluate and measure performance against

progress in its commercialization efforts and clinical trials.

The following table sets forth significant segment expenses.

Year Ended December 31,

In November 2023, the FASB issued ASU 2023-07 Segment Reporting (Topic 280):

“Improvements to Reportable Segment Disclosures to enhance the reportable segment disclosures” .

The guidance requires additional disclosures about significant segment expenses.

As noted above, the Company is a provider of data content and services related to the repair, normalization and interoperability of information for healthcare providers and big data analytics for the healthcare industry.

The Company has determined that it currently operates in a single segment - health information technology solutions and services, located in a single geographic location – the United States.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies.

Since the Company operates in a single segment, the measure of segment total assets and loss from operations is the same as that reported on the accompanying consolidated balance sheets as total assets, and the accompanying consolidated statements of operations as loss from operations, respectively.

The Company’s Chief Executive Officer is the Chief Operating Decision Maker (“CODM”).

The CODM manages the Company’s business activities as a single operating and reportable segment.

The CODM uses consolidated profit and loss to evaluate and measure performance against progress in its commercialization efforts and clinical trials.

The following table sets forth significant segment assets and expenses.

December 31, December 31,

Cash $ 1,644,439 $ 106,654

Accounts receivable, net 313,350 372,716

Prepaid expenses and other assets 65,627 24,008

Service revenue:

Fixed assets 10,220 -

Intangible assets 20,019 -

Goodwill 5,842,433 5,842,433

Total Assets $ 7,896,088 $ 6,345,811

For the Years Ended

Revenue $ 2,877,629 $ 2,989,599

Cost of revenue 1,957,923 2,243,614

Gross profit 919,706 745,985

Operating expenses:

1 unchanged sentence

Salaries and wages 513,727 268,399

Stock compensation

Other general and administrative

Total operating expense

General and administrative 853,343 756,115

Depreciation 404 -

Total operating expenses 1,878,425 2,005,411

Other income (expense)

Interest expense ( 2,985,597 ) ( 104,201 )

Warrant modification expense ( 565,277 ) -

Forgiveness of accounts payable 143,588 227,402

Impairment of goodwill

( 2,524,034 )

Loss on shares issued for legal settlement ( 78,104 ) -

Total other income (expense)

( 3,485,390 ) 123,201

$ ( 1,136,225 )

$ ( 3,981,144 )

Net loss $ ( 4,444,109 ) $ ( 1,136,225 )

Subsequent Events

The Company has evaluated

all events that occurred after the consolidated balance sheet date through the date when the consolidated financial statements were issued

to determine if they must be reported.

Management has determined that except as disclosed below, there were no additional reportable subsequent

events to be disclosed.

Financing Transaction

On January 18, 2025, the Company

closed a Securities Purchase Agreement (the “SPA”) with certain accredited investors.

Under the SPA, the Company sold a series

of senior secured convertible notes with an aggregate principal amount of $ 1,500,000 , that had an initial conversion price of $ 1.25 per

share, subject to certain adjustments and maturity date of December 31, 2025.

The Company also issued five year warrants to acquire up

to an aggregate 7,256,364 additional shares of the Company’s common stock with exercise prices ranging from $ 1.25 to $ 1.375 per

Issuance of Shares

for note conversions

February 3, 2025 and February 27, 2025, the company issued an aggregate 54,980 shares of common stock for the conversion of $ 47,283 in

principal and accrued interest on its convertible loans.

Issuance of Shares as settlement of other obligations

On March 14, 2025, the Company

issued 191,250 shares of common stock valued at $ 148,410 as part of a stock settlement agreement for payment of its obligation under its

judgement from Core IR.

The Company has evaluated all events that occurred after the consolidated balance sheet date through the date when the consolidated financial statements were issued to determine if they must be reported.

Management has determined that except as disclosed below, there were no additional reportable subsequent events to be disclosed.

Issuance of Shares for Note Conversions

On February 18, 2026, the Company issued an aggregate 122,589 shares of common stock for the conversion of $ 42,857 in principal and accrued interest on its convertible loans.

Issuance of Shares for Warrant Exercises

On February 12, 2026, the Company issued an aggregate 50,000 shares of common stock for the exercise of warrants for which it received aggregate net of $ 15,502 .

EXHIBIT INDEX

Pursuant to the rules and regulations

of the SEC, the Company has filed certain agreements as exhibits to this Annual Report on Form 10-K.

These agreements may contain representations

and warranties by the parties.

These representations and warranties have been made solely for the benefit of the other party or parties

to such agreements and (i) may have been qualified by disclosures made to such other party or parties, (ii) were made only as of the date

of such agreements or such other date(s) as may be specified in such agreements and are subject to more recent developments, which may

not be fully reflected in the Company’s public disclosure, (iii) may reflect the allocation of risk among the parties to such agreements

and (iv) may apply materiality standards different from what may be viewed as material to investors.

Accordingly, these representations

and warranties may not describe the Company’s actual state of affairs at the date hereof and should not be relied upon.

Pursuant to the rules and

regulations of the SEC, the Company has filed certain agreements as exhibits to this Annual Report on Form 10-K.

These agreements may

contain representations and warranties by the parties.

These representations and warranties have been made solely for the benefit of the

other party or parties to such agreements and (i) may have been qualified by disclosures made to such other party or parties, (ii) were

made only as of the date of such agreements or such other date(s) as may be specified in such agreements and are subject to more recent

developments, which may not be fully reflected in the Company’s public disclosure, (iii) may reflect the allocation of risk among

the parties to such agreements and (iv) may apply materiality standards different from what may be viewed as material to investors.

these representations and warranties may not describe the Company’s actual state of affairs at the date hereof and should not be

Exhibit Description

Certificate of Incorporation, as amended February 1, 2019 (incorporated by reference to Exhibit 3.1 to the Company’s 10-K filed with the SEC on April 1, 2019)

Certificate of Incorporation, as amended December 8, 2025 (incorporated by reference to Exhibit 3.1 to the Company’s S-1 filed with the SEC on January 8, 2026)

Amended and Restated By-laws (Incorporated by reference to Exhibit 3.3 to the Company’s Registration Statement on Form S-1 (File No.

333-213166) filed with the SEC on August 16, 2016)

2025 Equity Incentive Plan (incorporated by reference to Exhibit 4.2 to the Company’s S-1 filed with the SEC on January 8, 2026)

Form of Series A, Series B and Series C Warrant (incorporated by reference to Exhibit 4.1 to the Company’s 8-K filed with the SEC on January 23, 2025)

3 unchanged sentences

Form of Guaranty and Security Agreement (incorporated by reference to Exhibit 10.4 to the Company’s 8-K filed with the SEC on January 23, 2025)

Settlement Agreement with CorProminence LLC, d/b/a Core IR (incorporated by reference to Exhibit 10.8 to the Company’s 8-K filed with the SEC on July 15, 2024)

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

2 unchanged sentences

Section 1350 Certification of the Chief Financial Officer*

Clawback Policy of SCWorx Corp.*

Clawback Policy of SCWorx Corp (Incorporated by reference to Exhibit 97.1 of the Company’s 10-K filed with the SEC on March 31, 2025)

Inline XBRL Instance Document.

5 unchanged sentences

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

Filed herewith

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

What changed 10-K

Item 9A. Controls and Procedures