What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-03-17 compared with 2025-03-31 · 1460 added, 1293 removed, 205 unchanged (93% of the section changed)

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing and

maintaining adequate disclosure controls and procedures, as defined in Rule 13a-15(e) under the Exchange Act, for our Company.

Consequently,

our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness

of our disclosure controls and procedures pursuant to Rule 13a-15(b) under the Exchange Act as of December 31, 2024.

In designing and

evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed

and operated, can provide only reasonable assurance of achieving the desired control objectives.

In addition, the design of disclosure

controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply its judgment

in evaluating the benefits of possible controls and procedures relative to their costs.

Based on that evaluation, our principal executive

officer and principal financial officer concluded that our disclosure controls and procedures are designed at a reasonable assurance level

as of December 31, 2024.

Management’s Annual Report on Internal

Evaluation of

Disclosure Controls and Procedures

Our management is

responsible for establishing and maintaining adequate disclosure controls and procedures, as defined in Rule 13a-15(e) under the Exchange

Act, for our Company.

Consequently, our management, with the participation of our principal executive officer and principal financial

officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(b) under the Exchange Act as of

December 31, 2025.

In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures,

no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required

to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on that evaluation,

our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are designed at

a reasonable assurance level as of December 31, 2025.

Annual Report on Internal Control Over Financial Reporting

management is responsible for establishing and maintaining adequate internal control over financial reporting.

“Internal control

over financial reporting,” as defined in Rule 13a-15(f) under the Exchange Act, means a process designed to provide reasonable

assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance

Our management, with the participation and supervision of our principal executive officer and our principal financial and

accounting officer, assessed the effectiveness of our internal control over financial reporting.

making this assessment, our management used the criteria set forth in Internal Control – Integrated Framework (2013) as

issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on this assessment, our management concluded that

our internal control over financial reporting was effective as of December 31, 2025.

Annual Report does not include an attestation report of the Company’s registered public accounting firm due to an exemption established

by SEC rules for emerging growth companies.

Changes in Internal

Control Over Financial Reporting

Our management is responsible for

establishing and maintaining adequate internal control over financial reporting.

“Internal control over financial reporting,”

as defined in Rule 13a-15(f) under the Exchange Act, means a process designed to provide reasonable assurance regarding the reliability

of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.

Our management, with

the participation and supervision of our principal executive officer and our principal financial and accounting officer, assessed the

effectiveness of our internal control over financial reporting.

In making this assessment, our management

used the criteria set forth in Internal Control – Integrated Framework (2013) as issued by the Committee of Sponsoring Organizations

of the Treadway Commission.

Based on this assessment, our management concluded that our internal control over financial reporting was

effective as of December 31, 2024.

This Annual Report does not include

an attestation report of the Company’s registered public accounting firm due to an exemption established by SEC rules for emerging

growth companies.

Changes in Internal Control Over Financial Reporting

During the three months

ended December 31, 2024, there were no changes in our internal control over financial reporting that materially affected, or are reasonably

likely to materially affect, our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) under

the Securities Exchange Act of 1934).

Limitation on Effectiveness

of Controls and Procedures

In designing and evaluating

our controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide

only reasonable and not absolute assurance of achieving the desired control objectives.

In assessing whether our disclosure controls and

procedures were effective at a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating

the cost-benefit relationship of possible controls and procedures.

There are inherent limitations to the effectiveness of any system of

controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures.

In addition, the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and

there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate.

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

the three months ended December 31, 2025, there were no changes in our internal control over financial reporting that materially affected,

or are reasonably likely to materially affect, our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)

and 15d-15(f) under the Securities Exchange Act of 1934).

on Effectiveness of Controls and Procedures

designing and evaluating our controls and procedures, management recognizes that any controls and procedures, no matter how well designed

and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives.

In assessing whether

our disclosure controls and procedures were effective at a reasonable level of assurance, management necessarily was required to apply

its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

There are inherent limitations to the effectiveness

of any system of controls and procedures, including the possibility of human error and the circumvention or overriding of the controls

and procedures.

In addition, the design of any system of controls is based in part upon certain assumptions about the likelihood of future

events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may

Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and

not be detected.

OTHER INFORMATION

Rule 10b5-1 Plan and Non-Rule

10b5-1 Trading Arrangement Adoptions, Terminations, and Modifications

Our directors and officers

may enter into trading plans or other arrangements with financial institutions to purchase or sell shares of our common stock, which plans

or arrangements are intended to comply with the affirmative defense provisions of Rule 10b5-1

of the Exchange Act or which may represent a non-Rule 10b5-1 trading arrangement, as defined under Item 408(a) of Regulation S-K.

During the three months ended

December 31, 2024, none of our directors or officers adopted , terminated or modified a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1

trading arrangement.

10b5-1 Plan and Non-Rule 10b5-1 Trading Arrangement Adoptions, Terminations, and Modifications

directors and officers may enter into trading plans or other arrangements with financial institutions to purchase or sell shares of our

common stock, which plans or arrangements are intended to comply with the affirmative defense provisions of Rule 10b5-1 of the Exchange

Act or which may represent a non-Rule 10b5-1 trading arrangement, as defined under Item 408(a) of Regulation S-K.

the three months ended December 31, 2025, none of our directors or officers adopted , terminated or modified a Rule 10b5-1 trading arrangement

or a non-Rule 10b5-1 trading arrangement.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTION

Not applicable.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE

Insider Trading Policy

We have adopted an Insider Trading Policy governing

the purchase, sale and/or other dispositions of our securities by our directors, officers and employees that are reasonably designed to

promote compliance with insider trading laws, rules and regulations.

The Insider Trading Policy is filed as an exhibit to this Annual

The remaining information for this item will be included

in our definitive proxy statement for our 2025 annual meeting of stockholders (the “2025 Proxy Statement"), to be filed with

the SEC no later than 120 days after December 31, 2024, and is incorporated herein by reference.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Code of Business

Conduct and Ethics

We have adopted a

written code of business conduct and ethics, or the Code of Business Conduct and Ethics, which applies to our directors, officers and

employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, and persons

performing similar functions.

Our Code of Business Conduct and Ethics is available on our website at www.investors.expion360.com

in the “Corporate Governance” section of the “Investor Relations” page.

In addition, we intend to post on our

website all disclosures that are required by law concerning any amendments to, or waivers from, any provision of our Code of Business

Conduct and Ethics.

The inclusion of our website address in this Annual Report does not include or incorporate by reference the information

on the website into this Annual Report.

Insider Trading

We have adopted an

Insider Trading Policy governing the purchase, sale and/or other dispositions of our securities by our directors, officers and employees

that are reasonably designed to promote compliance with insider trading laws, rules and regulations.

The Insider Trading Policy is filed

as an exhibit to this Annual Report.

The remaining information

required by this item will be included in our definitive proxy statement for our 2026 annual meeting of stockholders (the “2026

Proxy Statement"), to be filed with the SEC no later than 120 days after December 31, 2025, and is incorporated herein by reference.

EXECUTIVE COMPENSATION

The information required by this item will be included

in the 2025 Proxy Statement and is incorporated herein by reference.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL

OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this item will be included

in the 2025 Proxy Statement and is incorporated herein by reference.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND

DIRECTOR INDEPENDENCE

The information required by this item will be included

in the 2025 Proxy Statement and is incorporated herein by reference.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item will be included

in the 2025 Proxy Statement and is incorporated herein by reference.

EXHIBITS AND FINANCIAL STATEMENT

(a)(1) Financial Statements

Our financial statements are listed

in the “Index to the Financial Statements,” which appears on page F-1 of this Annual Report.

(a)(2) Financial Statement Schedules

All financial statement schedules

are omitted because the information called for is not required or is shown either in the financial statements or the notes thereto.

The information required

by this item will be included in the 2026 Proxy Statement and is incorporated herein by reference.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required

by this item will be included in the 2026 Proxy Statement and is incorporated herein by reference.

CERTAIN RELATIONSHIPS

AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required

by this item will be included in the 2026 Proxy Statement and is incorporated herein by reference.

ACCOUNTANT FEES AND SERVICES

The information required

by this item will be included in the 2026 Proxy Statement and is incorporated herein by reference.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

Financial Statements

financial statements are listed in the “Index to the Financial Statements,” which appears on page F-1 of this Annual Report.

(a)(2) Financial

Statement Schedules

financial statement schedules are omitted because the information called for is not required or is shown either in the financial statements

or the notes thereto.

(a)(3) Exhibits

The following is a list of exhibits filed as part

of this Annual Report.

The following is

a list of exhibits filed as part of this Annual Report.

Incorporated by Reference

of Incorporation of the Company, effective as of November 4, 2021

of Amendment of Articles of Incorporation, effective as of October 8, 2024

and Restated Bylaws of the Company, dated August 21, 2024

of the Company’s Common Stock Certificate

Certificate of Amendment

of Articles of Incorporation, effective as of October 8, 2024

Amended and Restated

Bylaws of the Company, dated August 21, 2024

Form of the Company’s

Common Stock Certificate

of Representative’s Warrant Agreement

of Senior Secured Promissory Note issued to bridge loan investors

of Capital Stock

of Warrant with an Exercise Price of $2.90

of Warrant with an Exercise Price of $3.32

of Convertible Note

Description of Capital Stock

March 2022 Form

of Common Stock Warrant

March 2023 Form of Warrant

with an Exercise Price of $2.90

March 2023 Form of Warrant

with an Exercise Price of $3.32

December 2023 Form of

Convertible Note

August 2024 Form of

Pre-Funded Warrant

August 2024 Form of

Series A Warrant

August 2024 Form of

Series B Warrant

October 2025 Form

of Pre-Funded Warrant

of Series A Warrant

of Series B Warrant

of Common Stock Warrant Issued to Selling Stockholders

October 2025 Form of

Common Warrant

January 2025 Form of

Pre-Funded Warrant

January 2025 Form of

Common Warrant

Director Compensation Policy, effective October 16, 2025

2021 Incentive Award Plan

to Expion360 Inc.

Amendment to Expion360

2021 Incentive Award Plan

2021 Employee Stock Purchase Plan

of Security Agreement Issued to Bridge Loan Investors

Lease of premises at 2025 SW Deerhound Avenue Redmond, OR

Lease of premises at 1266 SW Lake Blvd., Redmond, OR

and Restated Employment Agreement, between Brian Schaffner and Expion360 Inc., dated January 26, 2023

and Restated Employment Agreement, between Paul Shoun and Expion360 Inc., dated January 26, 2023

and Restated Employment Agreement, between Greg Aydelott and Expion360 Inc., dated January 26, 2023

Purchase Agreement, dated December 27, 2023, between Expion360 Inc.

Stock Purchase Agreement, dated December 27, 2023, between Expion360 Inc.

and Tumim Stone Capital, LLC

Registration Rights Agreement, dated December 27, 2023, between Expion360 Inc.

and Tumim Stone Capital, LLC

Underwriting Agreement, dated August 7, 2024, between Expion360 Inc.

Agreement, dated August 7, 2024, between Expion360 Inc.

and Aegis Capital Corp.

Subsidiaries of the Company

At-The-Market

Issuance Sales Agreement, dated December 12, 2025, by and between Expion360 Inc.

and Aegis Capital Corp.

Employment Agreement,

between Carson Heagen and Expion360 Inc., dated April 1, 2025

and Restated Employment Agreement, by and between the Company and Shawna Bowin, effective September 3, 2025

Form of Securities Purchase

Agreement, dated as of January 2, 2025, by and among the Company and the purchasers on the signature pages thereto

Form of Registration

Rights Agreement, dated as of January 2, 2025, by and among the Company and the purchasers on the signature pages thereto

Form of Securities Purchase

Agreement, dated October 16, 2025

Agreement, Consulting Agreement and General Release, by and between the Company and Brian Schaffner, dated October 16, 2025

Agreement and General Release, by and between the Company and Paul Shoun, dated October 16, 2025

Agreement, by and between the Company and Joseph Hammer, October 16, 2025

Form of Indemnification

of the Company

Expion360 Inc.

Insider Trading Policy

Consent of M&K CPAS PLLC

Power of Attorney (reference is made to the signature page hereto)

Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C.

Trading Policy

Consent of M&K CPAS

Power of Attorney (reference

is made to the signature page hereto)

Certification of Principal

Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley

Certification of Principal

Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley

Certification of Principal

Executive Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Principal

Financial Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Expion360 Inc.

Executive Compensation Clawback Policy

Compensation Clawback Policy

XBRL Instance Document.

XBRL Taxonomy Extension Schema Document.

XBRL Taxonomy Extension Calculation Linkbase Document.

XBRL Taxonomy Extension Definition Linkbase Document.

XBRL Taxonomy Extension Label Linkbase Document.

XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File (formatted as Inline XBRL and included in Exhibit 101).

† Indicates a management

contract or compensatory plan or arrangement.

# This certification is deemed not filed for purpose of Section 18 of the Exchange Act or otherwise subject

to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange

* The schedules and exhibits to this agreement have been omitted pursuant

to Item 601(a)(5) of Regulation S-K.

A copy of any omitted schedule and/or exhibit will be furnished to the SEC upon request.

FORM 10-K SUMMARY

Pursuant to the requirements of

Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual Report on Form 10-K to

be signed on its behalf by the undersigned thereunto duly authorized.

XBRL Taxonomy Extension

Schema Document.

XBRL Taxonomy Extension

Calculation Linkbase Document.

XBRL Taxonomy Extension

Definition Linkbase Document.

XBRL Taxonomy Extension

Label Linkbase Document.

XBRL Taxonomy Extension

Presentation Linkbase Document.

Cover Page Interactive

Data File (formatted as Inline XBRL and included in Exhibit 101).

a management contract or compensatory plan or arrangement.

certification shall not be deemed “filed” by the registrant for purposes of Section 18 of the Exchange Act, and shall

not be incorporated by reference into any of the registrant’s filings under the Securities Act or the Exchange Act, whether

made before or after the date of this Quarterly Report, irrespective of any general incorporation language contained in any such

Certain of the schedules

(and similar attachments) to this exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K under the Securities

Act because they do not contain information material to an investment decision and that information is not otherwise disclosed in

the exhibit or the disclosure document.

The registrant agrees to furnish a copy of all omitted schedules (or similar attachments)

to the Commission upon its request.

to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual

Report on Form 10-K to be signed on its behalf by the undersigned thereunto duly authorized.

Expion360 Inc.

/s/ Brian Schaffner

Brian Schaffner

Chief Executive Officer and Interim Chief Financial Officer

( Principal Executive, Financial and Accounting Officer )

Joseph Hammer

Executive Officer and Chairman of the Board of Directors

( Principal Executive Officer )

March 16, 2026

POWER OF ATTORNEY

Each person whose signature appears

below constitutes and appoints Brian Schaffner as his or her true and lawful attorneys-in-fact, proxies and agents, each with full power

of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and

all amendments to this Annual Report on Form 10-K and to file the same, with any exhibits thereto and other documents in connection

therewith, with the Securities and Exchange Commission, granting unto such attorneys-in-fact, proxies and agents full power and authority

to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and

purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact, proxies and agents, or their

or his or her substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of

the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the following persons on behalf

of the Registrant in the capacities and on the dates indicated.

/s/ Brian Schaffner

Chief Executive Officer, Interim Chief Financial Officer and Director

March 31, 2025

Brian Schaffner

(Principal Executive, Financial and Accounting Officer)

/s/ George Lefevre

March 31, 2025

person whose signature appears below constitutes and appoints Joseph Hammer and Shawna Bowin, and each of them, as his or her true and

lawful attorneys-in-fact, proxies and agents, each with full power of substitution and resubstitution, for him or her and in his or her

name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K and to file

the same, with any exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting

unto such attorneys-in-fact, proxies and agents full power and authority to do and perform each and every act and thing requisite and

necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying

and confirming all that said attorneys-in-fact, proxies and agents, or their or his or her substitutes, may lawfully do or cause to be

done by virtue hereof.

to the requirements of the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the

following persons on behalf of the Registrant in the capacities and on the dates indicated.

Joseph Hammer

Executive Officer and Chairman of the Board of Directors

Executive Officer )

Financial Officer

Financial and Accounting Officer)

George Lefevre

/s/ Steven M Shum

March 31, 2025

/s/ Paul Shoun

Chief Operating Officer, President and Chairman of the Board of Directors

March 31, 2025

Index to Consolidated

Financial Statements

Report of Independent Registered Public Accounting Firm (PCAOB ID # 2738 )

Balance Sheets

Statements of Operations

Statements of Stockholders’ Equity (Deficit)

Statements of Cash Flows

Notes to the Consolidated Financial Statements

FINANCIAL INFORMATION

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

To the Board of Directors and Stockholders of Expion360,

Brian Schaffner

to Financial Statements

of Independent Registered Public Accounting Firm (PCAOB ID # 2738 )

of Operations

of Stockholders’ Equity (Deficit)

of Cash Flows

to the Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC

ACCOUNTING FIRM

To the Board of Directors and Stockholders

of Expion360, Inc.

Opinion on the Financial Statements

We have audited the accompanying balance sheets of

Expion360, Inc.

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

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.

We have audited the accompanying balance

sheets of Expion360, Inc.

(the Company) as of December 31, 2025 and 2024, and the related statements of operations, 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.

Going Concern

The accompanying financial statements have been prepared

assuming that the Company will continue as a going concern.

As discussed in Note 2 to the financial statements, the Company suffered a

net loss from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern.

Management’s plans regarding those matters are also described in Note 2.

The financial statements do not include any adjustments

that might result from the outcome of this uncertainty.

The accompanying financial statements

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

As discussed in Note 2 to the financial statements, the

Company suffered a net loss from operations and negative cash flows from operations, and has a net capital deficiency, each of which

are factors that raise substantial doubt about its ability to continue as a going concern.

Management’s plans to address these

challenges are also described in Note 2.

The financial statements do not include any adjustments that might result from the outcome of

this uncertainty.

Basis for Opinion

6 unchanged sentences

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 audit 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.

We conducted our audits in accordance

with the standards of the PCAOB.

Those standards require that we plan and perform the audit 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.

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

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

presentation of the financial statements.

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.

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

Critical Audit Matter

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 matter communicated

below is a matter arising from the current period audit of the financial statements that was 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 matter 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 matter below, providing separate

opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Going Concern

Due to the recurring net loss for the year and net

cash used in operating activities, the Company evaluated the need for a going concern.

Due to factors such as the net loss for

the year, negative cash flows from operations, and the net capital deficiency, the Company evaluated the need to include a going concern

qualification in the financial statements.

See discussion in Note 2.

Auditing management’s evaluation of a going

concern can be a significant judgement given the fact that the Company uses management estimates on future revenues and expenses which

are not able to be substantiated.

To evaluate the appropriateness of the lack of going

concern, we examined and evaluated the financial information that was the initial cause along with management’s plans to mitigate

the going concern and managements lack of disclosure on going concern.

Auditing management’s determination

regarding the inclusion of a going concern qualification requires significant judgement given the fact that the Company uses management

estimates of future revenues and expenses, as well as assumptions about future fundraising activity, which are not able to be substantiated.

To evaluate the appropriateness of the

going concern qualification, we examined and evaluated the financial information, including management’s plans to mitigate the

going concern qualification, and management’s disclosure on going concern.

/s/ M&K CPAS, PLLC

We have served as the Company’s auditor since 2021.

We have served as the Company’s

auditor since 2021.

The Woodlands, TX

20 unchanged sentences

Accrued expenses and other current liabilities

Convertible note

Current portion of operating lease liability

Current portion of stockholder promissory notes

Current portion of long-term debt

17 unchanged sentences

Total liabilities and stockholders’ equity

The accompanying notes are an integral part of these financial statements.

The accompanying notes are an integral

part of these financial statements.

Expion360 Inc.

11 unchanged sentences

Settlement expense

Suspended liability expense

Total other expense

Suspended liability expense / (income)

( 4,485,948 )

Other (income) / expense

Total other (income) / expense

( 4,468,468 )

Loss before taxes

6 unchanged sentences

Weighted-average number of common shares outstanding

The accompanying notes are an integral part of these financial statements.

The accompanying notes are an integral

part of these financial statements.

Expion360 Inc.

Statements of Stockholders’ Equity (Deficit)

for Years Ended December 31, 2024 and 2023

Additional Paid-in Capital

Accumulated Deficit

Total Stockholders’ Equity (Deficit)

Balance at December 31, 2022

Statements of Stockholders’

Paid-in Capital

Stockholders’ Equity (Deficit)

at December 31, 2023

$ ( 21,095,765 )

Proceeds received from cashless exercise of warrants

Proceeds received from cash exercise of warrants

Stock issued as a result of litigation settlement

Issuance of warrants

Issuance of stock options

Issuance of RSUs

Settlement of vested RSUs

Issuance of common stock in exchange for short-term loan costs

issued for ELOC

received from cashless exercise of warrants

received from cash exercise of warrants

issued for interest payment

of stock options

of vested RSUs

of commitment shares

issued as a result of litigation settlement

of shares and pre-funded warrants, net of issuance costs

from exercise of Series A warrants

from exercise of Series B warrants

issued for true-up upon completion of Reverse Stock Split

( 13,479,475 )

Balance at December 31, 2023

at December 31, 2024

$ ( 34,575,240 )

Stock issued for ELOC

Proceeds received from cashless exercise of warrants

Proceeds received from cash exercise of warrants

Stock issued for interest payment

Issuance of stock options

Issuance of RSUs

Settlement of vested RSUs

Settlement of commitment shares

Stock issued as a result of litigation settlement

Issuance shares and pre-funded warrants, follow-on offering, net of issuance costs

Proceeds from exercise of Series A warrants

Proceeds from exercise of Series B warrants

Shares issued for true-up upon reverse stock split

received from cash exercise of Series A warrants

received from cash exercise of Series B warrants

received from cash exercise of January 2025 warrants

of shares and pre-funded warrants, net of issuance cost

of stock options

and settlement of RSUs

of shares in exchange for services

( 6,235,187 )

Balance at December 31, 2023

at December 31, 2025

$ ( 40,810,427 )

The accompanying notes are an integral part of these financial statements.

The accompanying notes are an integral

part of these financial statements.

Expion360 Inc.

Statements of Cash Flows

For the Years Ended December 31,

Cash flows from operating activities

the Years Ended December 31,

Cash flows from operating

$ ( 6,235,187 )

$ ( 13,479,475 )

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

Amortization of convertible note costs

Loss on sale of property and equipment

Decrease in allowance for doubtful accounts

Stock-based settlement

Stock-based compensation

Decrease in right-of-use assets and lease liabilities

Increase in suspended liability

Changes in operating assets and liabilities:

(Increase) / Decrease in accounts receivable

(Increase) / Decrease in inventory

Adjustments to reconcile net

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

of convertible note costs

sale of property and equipment

of common stock in exchange for services

expense in exchange for asset disposal

/ Decrease in inventory valuation

in right-of-use assets and lease liabilities

/ (Decrease) in suspended liability

( 4,485,948 )

Increase in prepaid/in-transit inventory

Changes in operating assets

and liabilities:

in accounts receivable

/ Decrease in inventory

( 1,006,071 )

Increase in prepaid expenses and other current assets

Decrease in deposits

Increase in accounts payable

Increase in customer deposits

Increase / (Decrease) in accrued expenses and other current liabilities

Increase in right-of-use assets and lease liabilities

Net cash used in operating activities

/ Decrease in prepaid/in-transit inventory

( 1,448,738 )

/ Decrease in prepaid expenses and other current assets

/ Decrease in deposits

in accounts payable

/ (Decrease) in customer deposits

in accrued expenses and other current liabilities

/ (Decrease) in right-of-use assets and lease liabilities

in suspended liability

Net cash used in operating

( 6,149,263 )

Cash flows from investing activities

Purchases of property and equipment

Net proceeds from sale of property and equipment

Net cash provided by investing activities

Cash flows from financing activities

Proceed from / (Principal payment on) convertible note

( 9,562,545 )

Principal payments on long-term debt

Principal payments on stockholder promissory notes

Proceeds from exercise of warrants

Settlement of fractional shares for cashless warrant exercise

Net proceeds from issuance of common stock

Net cash provided by financing activities

Net change in cash and cash equivalents

Cash flows from investing

of property and equipment

proceeds from sale of property and equipment

Net cash provided by investing

Cash flows from financing

payments on convertible note

( 2,750,000 )

payments on long-term debt

payments on stockholder promissory notes

from exercise of warrants

proceeds from issuance of common stock

Net cash provided by financing

Net change in cash and cash

( 3,385,133 )

Cash and cash equivalents, beginning

Cash and cash equivalents, ending

and cash equivalents, beginning

and cash equivalents, ending

Statements of Cash

Flows - Continued

the Years Ended December 31,

disclosure of cash flow information:

Cash paid for

Cash paid / (received) for

franchise taxes

financing activities:

Acquisition/modification

of operating lease right-of-use asset and lease liability

of common stock for payment on accrued interest

of common stock for payment on accrued compensation

The accompanying notes are an integral

part of these financial statements.

THE FINANCIAL STATEMENTS

Organization and Nature of Operations

Expion360 Inc.

Statements of Cash Flows - Continued

For the Years Ended December 31,

Supplemental disclosure of cash flow information:

Cash paid for interest

Cash paid / (received) for franchise taxes

Non-cash financing activities:

Acquisition/modification of operating lease right-of-use asset and lease liability

Issuance of common stock for payment on accrued interest

Issuance of common stock for payment on accrued compensation

Issuance of common stock in exchange for short-term loan costs

“Company”) was incorporated in the State of Nevada in November 2021.

Effective November 1, 2021, the Company converted to

a C corporation.

The Company was originally formed as a limited liability company in the State of Oregon in June 2016.

The Company designs,

assembles, manufactures, and sells lithium iron phosphate (“LiFePO4”) batteries and supporting accessories for recreational

vehicles (“RVs”), marine, and industrial applications.

The Company’s lithium battery solutions incorporate innovative

concepts and have been designed to include some of the most dense and minimal-footprint batteries in the RV and marine industries.

Company’s customers consist of dealers, wholesalers, private-label customers, and original equipment manufacturers (“OEMs”)

who then sell its products to end consumers.

The Company currently operates in one reportable business segment, Energy Storage (ES).

Summary of Significant Accounting Policies

of Presentation

The audited financial

statements and accompanying notes have been prepared by the Company in accordance with accounting principles generally accepted in the

United States of America (“U.S.

Reclassification

of Prior Year Presentation

Certain prior year

amounts have been reclassified for consistency with current year presentation.

These reclassifications had no effect on the reported

results of operations.

The Company’s

activities are subject to significant risks and uncertainties, including that it may be unable to secure additional funding before it

achieves profitability or positive cash flow from operations.

The Company expects to continue to incur operating losses for the foreseeable

future, and will need to raise additional debt or equity financing to fund working capital, purchase inventory, expand its presence in

the marketplace, develop new products, achieve operating efficiencies, and accomplish its long-term business plan.

There can be no assurance

that additional financing will be available on acceptable terms or at all.

Historically, the

Company’s operations have been funded through a combination of sales of equity securities, and issuances of third party debt and

working capital loans.

As presented in the accompanying financial statements, the Company has sustained recurring losses and negative

cash flows from operations and has a significant negative stockholders’ equity balance.

The Company incurred net losses of $ 6.2

million and $ 13.5

million for the years ended December 31, 2025 and 2024, respectively.

The Company had negative flows from operating activities of $ 6.1

million and $ 9.6

million for the years ended December 31, 2025

and 2024, respectively.

In addition, the Company had accumulated deficits of $ 40.8

million and $ 34.6

million as of December 31, 2025 and 2024, respectively.

Company has never achieved profitability or positive cash flows from operations, and may not be able to do so for the foreseeable future.

These factors raise substantial doubt about the Company’s ability to continue as a going concern within twelve months after the

date that the financial statements for the year ended December 31, 2025 are issued.

However, management is working to address its operational

and liquidity challenges, including raising additional capital, managing inventory levels, identifying alternative supply chain resources,

and managing operational expenses.

The accompanying

financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization

of assets and the settlement of liabilities and commitments in the normal course of business;

however, the above conditions raise substantial

doubt about the Company’s ability to do so.

The financial statements do not include any adjustments to reflect the possible future

effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result should the

Company be unable to continue as a going concern.

The preparation of

financial statements in conformity with U.S.

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

of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported

amounts of revenue and expenses during the reporting period.

The Company’s significant accounting estimates include the carrying

value of inventory, the depreciable lives of fixed assets, operating lease assets and liabilities, and stock-based compensation and warrant

Management evaluates its estimates and assumptions on an ongoing basis using historical experience, existing and known circumstances,

authoritative accounting guidance, and other factors management believes to be reasonable and makes adjustments when facts and circumstances

These estimates are based on information available as of the date of the financial statements.

Actual results could differ from

these estimates, which may result in material effects on the Company’s financial condition, results of operations and liquidity.

To the extent there are differences between these estimates and actual results, the Company’s financial statements may be materially

Inventory is stated

at the lower of cost (first in, first out) or net realizable value and consists of batteries and accessories, resale items, components,

and related landing costs.

As of December 31, 2025 and 2024, the Company had inventory that consisted of finished assemblies totaling

$ 2,269,267 and

$ 4,077,013 ,

The accompanying notes are an integral part of these financial statements.

NOTES TO THE FINANCIAL STATEMENTS

Organization and Nature

of Operations

Expion360 Inc.

(formerly Yozamp Products Company,

LLC dba Expion360) (the “Company”) was incorporated in the state of Nevada in November 2021.

Effective November 1, 2021, the

Company converted to a C corporation.

Prior to conversion, the Company was a limited liability company (“LLC”) with an indefinite

life organized in the State of Oregon in June 2016.

The LLC elected to be treated as a Subchapter S corporation effective January 1, 2017.

Net profits and losses of the LLC and all distributions were allocated among the members in proportion to the ownership units held.

Original LLC Agreement was amended and restated on January 1, 2021 to add additional members and a non-voting class of member units.

conversion to a C corporation, all existing LLC members at the time of conversion were issued shares of the Company’s common stock,

par value $0.001 per share and became stockholders of the Company.

The Company designs, assembles, and distributes premium

lithium batteries for RV, Marine, Golf, Industrial, Residential, and Off-The-Grid needs.

The Company uses lithium iron phosphate (“LiFePO4”)

LiFePO4 batteries are considered a top choice for high energy density, dependability, longevity, and safety, providing the

ability to power anything, anywhere.

Summary of Significant

Accounting Policies

Basis of Presentation

The accompanying audited financial statements have

been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) for interim financial information, and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X promulgated

by the Securities and Exchange Commission (“SEC”).

Accordingly, they do not include all of the information and footnotes required

GAAP for complete financial statement presentation.

However, the Company believes that the disclosures are adequate to make the

information presented not misleading.

In the opinion of management, all adjustments (consisting primarily of normal recurring accruals)

considered necessary for a fair presentation have been included.

Unless otherwise noted, all references to shares and

stockholders in the accompanying financial statements have been restated retroactively, to reflect the equity structure of the C corporation

as of the beginning of the first period presented.

Reclassification of Prior Year Presentation

Certain prior year amounts have been reclassified

for consistency with current year presentation.

These reclassifications had no effect on the reported results of operations.

Going Concern, Liquidity and Capital Resources

The Company’s activities are subject to significant

risks and uncertainties, including failing to secure additional funding before the Company achieves sustainable revenue and profit from

The Company expects to continue to incur additional losses for the foreseeable future, and the Company may need to raise additional

debt or equity financing to expand its presence in the marketplace, develop new products, achieve operating efficiencies, and accomplish

its long-term business plan over the next several years.

There can be no assurance as to the availability or terms upon which such financing

and capital might be available.

As presented in the accompanying financial statements,

the Company has sustained recurring losses and negative cash flows from operations.

These factors raise substantial doubt about the Company’s

ability to continue as a going concern within twelve months after the date that the financial statements for the year ended December 31,

2024 are issued.

However, management is working to address its cash flow challenges, including raising additional capital, managing inventory

levels, identifying alternative supply chain resources, and managing operational expenses.

Historically, the Company’s growth has been

funded through a combination of sales of equity interests, third party debt, and working capital loans.

The Company’s sales for

2024 decreased 6.0 % compared to sales for 2023, as the overall RV market experienced a severe slowdown.

For the year ended December 31,

2024, we received net proceeds of $ 9,510,181 from issuance of common stock and an additional $ 185,434 from exercise of warrants.

year ended December 31, 2023, we received net proceeds of $ 2,420,025 from issuing commitment shares in exchange for a short-term convertible

note, and $ 49,777 from warrant exercises.

On April 1, 2022, the Company completed an initial public offering and listing of its shares

on the Nasdaq Stock Market (IPO).

The accompanying financial statements have been prepared

assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities

and commitments in the normal course of business;

however, the above conditions raise substantial doubt about the Company’s ability

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification

of assets or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.

Use of Estimates

The preparation of financial statements in conformity

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure

of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the

reporting period.

Actual results could vary materially from the estimates that were used.

The Company’s significant accounting estimates

include the carrying value of accounts receivable and inventory, the depreciable lives of fixed assets, and stock-based compensation.

Future events, including the extent and the duration

of the COVID-19-related economic impacts and their effects, cannot be predicted with certainty and, accordingly, the Company’s accounting

estimates require the exercise of judgment.

Cash and Cash Equivalents

The Company considers all cash amounts which are not

subject to withdrawal restrictions or penalties and all highly liquid investments purchased with an original maturity of three months

or less from the date of purchase to be cash equivalents.

The Company maintains its cash balances with high-quality financial institutions

located in the United States.

Cash accounts are secured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000

respectively, and raw materials (inventory components, parts, and packaging) totaling $ 589,513

and $ 754,448 ,

respectively.

The valuation of inventory includes fixed production overhead costs based on normal capacity of the assembly warehouse.

The Company periodically

reviews its inventory for evidence of slow-moving or obsolete inventory and provides for an allowance when considered necessary.

the Company wrote off and wrote down $ 919,730

in obsolete inventory.

A portion of the obsolete inventory

was sold for scrap or recycled, and a portion has been retained to use in marketing promotions and was either written down to its estimated

net realizable value or written off completely.

The value of obsolete inventory that remains on the Balance Sheet as of December 31,

2025 is $ 547,294 .

The Company prepays

for inventory purchases from foreign suppliers.

Prepaid inventory totaled $ 318,440

and $ 1,612,686

at December 31, 2025 and 2024, respectively, and included inventory

in transit where title had passed to the Company but had not yet been physically received.

and Foreign Concentrations of Inventory Suppliers

During the years

ended December 31, 2025 and 2024, approximately 55% and 82%, respectively, of inventory purchases were made from foreign suppliers in

Any adverse change in either the economic or political conditions abroad could negatively impact the Company’s supply chain.

The inability to obtain product to meet sales demand could adversely affect the Company’s results of operations.

However, the Company

has secured a secondary source for lithium iron phosphate cells used in its batteries from a supplier in Europe, enabling the Company

to source materials outside of Asia in the event it becomes necessary to do so.

and Cash Equivalents

The Company considers

all cash amounts which are not subject to withdrawal restrictions or penalties, and all highly liquid investments purchased with an original

maturity of three months or less from the date of purchase to be cash equivalents.

The Company maintains its cash and cash equivalents

balances with high-quality financial institutions located in the United States.

Cash accounts are secured by the Federal Deposit Insurance

Corporation (“FDIC”) up to $ 250,000

per institution.

At times, balances may exceed federally insured limits.

Investment accounts are placed in funds consisting of US Treasury-related

ultra-short paper, which earned $86,121 and $125,755 during the years ended December 31, 2024 and 2023, respectively.

The Company has

not experienced any losses in such accounts and management believes that the Company is not exposed to any significant credit risk with

respect to its cash and cash equivalents.

As of December 31, 2024, cash balances exceeded FDIC limits by $277,522 and investment accounts

totaling $712 are invested in US Treasury-related ultra-short paper.

Accounts Receivable

Accounts receivable are recorded at the invoiced amount,

are due within a year or less, and generally do not bear any interest.

The Company performs ongoing credit evaluations of its customers

and generally requires no collateral.

An allowance for uncollectible accounts is recorded to reduce accounts receivable to the estimated

amount that will be collected.

The allowance is based upon management’s review of the accounts receivable aging and specific identification

of potentially uncollectible balances.

Recoveries of accounts previously written off and adjustments to the allowance for uncollectible

accounts are recorded as adjustments to bad debt expense.

There was no allowance for doubtful accounts as of December 31, 2024 or December

31, 2023, as management believed all outstanding amounts to be fully collectible.

Customer Deposits

As of December 31, 2024 and December 31, 2023, the

Company had customer deposits totaling $ 48,474 and $ 17,423 , respectively.

Inventory is stated at the lower of cost (first in,

first out) or net realizable value and consists of batteries and accessories, resale items, components, and related landing costs.

of December 31, 2024 and December 31, 2023, the Company had inventory that consisted of finished assemblies totaling $ 4,077,013 and $ 2,967,021 ,

respectively, and raw materials (inventory components, parts, and packaging) totaling $ 754,448 $ 858,369 , respectively.

The valuation of

inventory includes fixed production overhead costs based on normal capacity of the assembly warehouse.

The Company periodically reviews its inventory for

evidence of slow-moving or obsolete inventory and provides for an allowance when considered necessary.

The Company determined that no

such reserve was necessary as of December 31, 2024 or December 31, 2023.

The Company prepays for inventory purchases from foreign suppliers.

Prepaid inventory totaled $ 1,612,686 and $ 163,948 at December 31, 2024 and December 31, 2023, respectively, and included inventory in

transit where title had passed to the Company but had not yet been physically received.

Vendor and Foreign Concentrations of Inventory

During the years ended December 31, 2024 and 2023,

approximately 82 % and 70 %, respectively, of inventory purchases were made from foreign suppliers in Asia.

Any adverse change in either

the economic or political conditions abroad could negatively impact the Company’s supply chain.

The inability to obtain product

to meet sales demand could adversely affect results of operations.

However, the Company has secured a secondary source for lithium iron

phosphate cells used in its batteries from a supplier in Europe, enabling the Company to source materials outside of Asia in the event

it becomes necessary to do so.

Property and Equipment

Property and equipment are stated at cost less depreciation

calculated on the straight-line basis over the estimated useful lives of the related assets as follows:

Schedule of estimated useful lives

Vehicles and transportation equipment

Manufacturing equipment

Office furniture and equipment

Warehouse equipment

Tooling and molds

Leasehold improvements are amortized over the shorter

of the lease term or their estimated useful lives.

Betterments, renewals, and extraordinary repairs that

extend the lives of the assets are capitalized;

other repairs and maintenance charges are expensed as incurred.

The cost and related accumulated

depreciation and amortization applicable to assets retired are removed from the accounts, and the gain or loss on disposition is recognized

in the Statements of Operations.

The Company determines if an arrangement is a lease

at inception.

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

the lease term, and operating lease liabilities represent

the Company’s obligation to make lease payments

arising from the lease.

Operating leases are included in ROU assets, current operating lease liabilities, and long-term operating lease

liabilities on the Company’s Balance Sheets.

The Company does not have any finance leases.

Lease ROU assets and lease liabilities are initially

recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using the

Company’s incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable.

also include any lease payments made at or before lease commencement and exclude any lease incentives received.

The Company’s lease

terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

Leases with a term of 12 months or less

are not recognized on the Company’s Balance Sheet.

The Company’s leases do not contain any residual value guarantees.

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

The Company accounts for lease and non-lease components

as a single lease component for all its leases.

Impairment of Long-Lived Assets

Long-lived assets consist primarily of property and

When events or circumstances indicate the carrying value of a long-lived asset may be impaired, the Company estimates the future

undiscounted cash flows to be derived from the use and eventual disposition of the asset to assess whether or not a potential impairment

If the carrying value exceeds the estimate of future undiscounted cash flows, the impairment is calculated as the excess of the

carrying value of the asset over the estimate of its fair value.

Fair value is determined primarily using the estimated cash flows discounted

at a rate commensurate with the risk involved.

No long-lived asset impairment was recognized during the years ended December 31, 2024

Product Warranties

The Company sells the majority of its products to

customers along with conditional repair or replacement warranties.

The Company’s branded DC mobile chargers are warrantied for two

years from the date of sale and its branded VPR 4EVER Classic and Platinum batteries are warrantied at gradually lesser levels over a

twelve-year period from date of sale.

The Company determines its estimated liability for warranty claims based on the Company’s

experience of the amount of claims actually made.

Management estimates no liability as of December 31, 2024 and 2023 because, historically,

there have been very few claims and costs for repairs or replacement parts have been nominal.

It is possible that the Company’s

estimate of liability for product liability claims will change in the near term.

Liability for Refunds

The Company does not have a formal return policy but

does accept returns under its warranty policies.

Returns have historically been minimal.

No refund liability was recognized in the year

ended December 31, 2023 or December 31, 2024.

Revenue is recorded net of this amount.

Any returns of discontinued product are not added

back to inventory and therefore related costs are nominal and not recorded as an asset.

Revenue Recognition

The Company’s revenue is generated from the

sale of products consisting primarily of batteries and accessories.

The Company recognizes revenue when control of goods or services is

transferred to its customers in an amount that reflects the consideration it is expected to be entitled to in exchange for those goods

At times, balances may exceed federally insured

The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to any significant

credit risk with respect to its cash and cash equivalents balances.

As of December 31, 2025, the Company had investment accounts with

a balance of $ 1,516,145 that

was invested in U.S.

treasury securities.

The Company’s

revenue is generated from the sale of products consisting primarily of batteries and accessories.

The Company recognizes revenue when

control of goods is transferred to its customers in an amount that reflects the consideration it is expected to be entitled to in exchange

for those goods or services.

To determine revenue recognition, the Company performs the following five steps:

(i) identify the contract(s) with a

(i) identify the contract(s)

with a customer;

(ii) identify the performance obligation(s) in the contract;

9 unchanged sentences

no uncertainties regarding payment terms or transfer of control.

Concentration of Major Customers

A customer is considered a major customer when net

revenue attributable to the customer exceeds 10% of total revenue for the period or outstanding receivable balances exceed 10% of total

During the year ended December 31, 2024, sales to

one customer totaled $ 726,292 , or approximately 14 % of our total sales and had 6 % of our outstanding accounts receivable at December 31,

Four other customers had accounts receivable balances totaling $ 339,111 , representing 60 % of total accounts receivable as of December

Sales to each of our other customers did not exceed 10% during this period.

During the year ended December 31, 2023, sales to

two customers totaled $ 1,237,232 , or approximately 21 % of our total sales, and these customers did not have any outstanding accounts receivable at December 31,

While these customers did not have accounts receivable balances as of December 31, 2023, four other customers had accounts receivable

balances totaling $ 142,255 , representing 91 % of total accounts receivable as of December 31, 2023.

Sales to each of our other customers

did not exceed 10% during this period.

Shipping and Handling Costs

Shipping and handling fees billed to customers are

classified on the Statement of Operations as “Net sales” and totaled $ 99,201 and $ 70,712 during the years ended December 31,

2024 and 2023, respectively.

Shipping and handling costs for shipping product to customers totaled $ 260,946 and $ 199,288 during the years

ended December 31, 2024 and 2023, respectively, and are classified in selling, general and administrative expense in the accompanying

Statements of Operations.

Advertising and Marketing Costs

The Company expenses advertising and marketing costs

Advertising and marketing expense totaled $ 926,430 and $ 929,220 for the years ended December 31, 2024 and 2023, respectively,

and is included in selling, general and administrative expense in the accompanying Statements of Operations.

Accounts receivable

are recorded at the invoiced amount, are due within a year or less, and generally do not bear any interest.

The Company performs ongoing

credit evaluations of its customers and generally requires no collateral.

An allowance for uncollectible accounts is recorded to reduce

accounts receivable to the estimated amount that will be collected.

The allowance is based upon management’s review of the accounts

receivable aging and specific identification of potentially uncollectible balances.

Recoveries of accounts previously written off and

adjustments to the allowance for uncollectible accounts are recorded as adjustments to bad debt expense.

There were no

allowances for doubtful accounts as of December 31, 2025 or

December 31, 2024, as management believed all outstanding amounts to be fully collectible.

Concentration

of Major Customers

A customer is considered

a major customer when net revenue attributable to the customer exceeds 10% of total revenue for the period or the outstanding accounts

receivable balance exceeds 10% of total accounts receivable balances.

During the year ended

December 31, 2025, sales to four customers totaled $ 5,795,965 ,

or approximately 60 %

of our total sales, and represented 69 %

of our outstanding accounts receivable at December 31, 2025.

During the year ended December 31, 2024, sales to one customer totaled $ 726,292 ,

or approximately 14 %

of our total sales and represented approximately 6 %

of our outstanding accounts receivable at December 31, 2024.

Four other customers had accounts receivable balances totaling $ 339,111 ,

representing 60 %

of total accounts receivable as of December 31, 2024.

Sales to each of our other customers did not exceed 10% during the respective periods.

As of December 31,

2025 and 2024, the Company had customer deposits totaling $ 2,978

and $ 48,474 ,

respectively.

Contractual arrangements

that meet the definition of a lease are classified as an operating lease or finance lease at inception.

The Company does not have any

finance leases.

Operating lease right-of-use

(“ROU”) assets represent the Company’s right to use an underlying asset during the lease term, and operating lease

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

Operating leases are included in

ROU assets, current operating lease liabilities, and long-term operating lease liabilities on the Balance Sheets.

Lease ROU assets

and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at

commencement date calculated using the Company’s incremental borrowing rate (“IBR”) applicable to the lease asset.

As the implicit rates for the Company's operating leases are generally not determinable, the Company uses an IBR based on the information

available at the respective lease commencement dates to determine the present value of future payments.

IBR represents the interest rate

that the Company would expect to incur at

lease commencement to borrow an amount equal to the lease payments on a collateralized basis with similar terms and payments, in an economic

environment where the leased asset is located.

ROU assets also include

any lease payments made at or before lease commencement and exclude any lease incentives received.

The Company’s lease terms may

include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

a term of 12 months or less are not recognized on the Balance Sheets.

The Company’s leases do not contain any residual value guarantees.

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

The Company accounts

for lease and non-lease components as a single lease component for all of its leases.

Property and Equipment

Property and equipment

are stated at cost less depreciation calculated on the straight-line basis over the estimated useful lives of the related assets as follows:

of estimated useful lives

and transportation equipment

Manufacturing

furniture and equipment

Leasehold improvements

are amortized over the shorter of the lease term or their estimated useful lives.

Betterments, renewals,

and extraordinary repairs that extend the lives of the assets are capitalized;

other repairs and maintenance charges are expensed as

The cost and related accumulated depreciation and amortization applicable to assets retired are removed from the accounts,

and the gain or loss on disposition is recognized in the Statements of Operations.

of Long-Lived Assets

Long-lived assets

consist primarily of property and equipment.

When events or circumstances indicate the carrying value of a long-lived asset may be impaired,

the Company estimates the future undiscounted cash flows to be derived from the use and eventual disposition of the asset to assess whether

or not a potential impairment exists.

If the carrying value exceeds the estimate of future undiscounted cash flows, the impairment is

calculated as the excess of the carrying value of the asset over the estimate of its fair value.

Fair value is determined primarily using

the estimated cash flows discounted at a rate commensurate with the risk involved.

No long-lived asset impairment was recognized during

the years ended December 31, 2025 or 2024.

The Company sells

the majority of its products to customers along with conditional repair or replacement warranties.

The Company’s branded products

carry warranties ranging from one year to up to twelve years from the date of sale, depending on the specific product.

The Company determines

its estimated liability for warranty claims based on the Company’s experience with respect to the number and value of warranty

claims actually made.

Historically, there have been very few claims and the costs associated with those claims have been nominal.

management estimated no liabilities associated with warranty claims as of December 31.

2025 and 2024.

The Company does

not have a formal return policy but does accept returns under its warranty policies.

Returns have historically been minimal.

is recorded net of returns.

Any returns of discontinued product are not added back to inventory and therefore related costs are nominal

and not recorded as an asset.

No refund liability was recognized in the years ended December 31, 2025 and 2024.

and Handling Costs

Shipping and handling

fees billed to customers totaled $ 49,386

for the years ended December 31, 2025 and 2024, respectively,

and are included in net sales on the Statement of Operations.

Shipping and handling costs for shipping product to customers totaled $ 357,484

and $ 260,946

for the years ended December 31, 2025 and 2024, respectively,

and are included in selling, general and administrative expense on the Statements of Operations.

and Marketing Costs

The Company expenses

advertising and marketing costs as incurred.

Advertising and marketing expense totaled $ 1,001,730

and $ 926,430

for the years ended December 31, 2025 and 2024, respectively,

and are included in selling, general and administrative expense on the Statements of Operations.

and Development

Research and development

Research and development costs are expensed as incurred.

Research and development costs charged to expense amounted to $ 295,292 and $ 397,662 for the years ended December 31, 2024 and 2023, respectively,

and are included in selling, general and administrative expenses in the accompanying Statements of Operations.

Effective November 1, 2021, the Company converted

from an LLC to a C corporation and, as a result, became subject to corporate federal and state income taxes.

Deferred tax assets and liabilities

are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of exiting

assets and liabilities and their respective tax basis.

Deferred tax assets, including tax loss and credit carryforwards, and liabilities

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

to be recovered or settled.

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

period that included the enactment date.

Deferred income tax expense represents the change during the period in the deferred tax assets

and deferred tax liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more

likely than not that some portion or all of the deferred tax assets will not be realized.

On March 27, 2020, the United States enacted the Coronavirus

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

The CARES Act is an emergency economic stimulus package that includes

spending and tax breaks to strengthen the United States economy and fund a nationwide effort to curtail the effect of COVID-19.

Act provides sweeping tax changes in response to the COVID-19 pandemic.

Some of the more significant provisions are removal of certain

limitations on utilization of net operating losses, increasing the loss carryback period for certain losses to five years, and increasing

the ability to deduct interest expense, as well as amending certain provisions of the previously enacted Tax Cuts and JOBS Act.

December 31, 2024 and December 31, 2023, the Company has not recorded any income tax provision/(benefit) resulting from the CARES Act,

mainly due to the Company’s history of net operating losses.

On December 27, 2020, the United States enacted the

Consolidated Appropriations Act of 2021 (the “CAA”).

The CAA includes provisions extending certain CARES Act provisions and

adds coronavirus relief, tax and health extenders.

The Company will continue to evaluate the impact of the CAA and its impact on its financial

statements in 2024 and beyond.

Fair Value of Financial Instruments

The Company accounts for its financial assets and

liabilities in accordance with ASC Topic 820, Fair Value Measurement .

ASC Topic 820 establishes a fair value hierarchy that prioritizes

the inputs to valuation techniques used to measure fair value, as follows:

Quoted prices (unadjusted) in active

markets for identical assets or liabilities that are accessible at the measurement date.

The fair value hierarchy gives the highest priority

to Level 1 inputs.

Observable prices that are based on

inputs not quoted on active markets but corroborated by market data.

These inputs include quoted prices for similar assets or liabilities;

activities primarily consist of product design and engineering, battery cell evaluation and testing, prototype development, performance

validation, certification and compliance testing, and enhancements to existing battery systems and related technologies.

and development costs are expensed as incurred.

Research and development costs charged to expense amounted to $ 558,882

and $ 295,292

for the years ended December 31, 2025 and 2024, respectively,

and are included in selling, general and administrative expenses on the Statements of Operations.

The Company uses

the asset and liability method of accounting for income taxes.

Under this method, deferred tax assets and liabilities are recognized

for the future tax consequences attributable to differences between the financial statement carrying amounts of exiting assets and liabilities

and their respective tax basis.

Deferred tax assets, including tax loss and credit carryforwards, and liabilities are measured using

the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included

the enactment date.

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

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion

or all of the deferred tax assets will not be realized.

Value of Financial Instruments

The Company accounts

for its financial assets and liabilities in accordance with ASC Topic 820, Fair Value Measurement.

ASC Topic 820 establishes a fair value

hierarchy that prioritizes the inputs to valuation techniques used to measure fair value, as follows:

Quoted prices

(unadjusted) in active markets for identical assets or liabilities that are accessible at the measurement date.

The fair value hierarchy

gives the highest priority to Level 1 inputs.

prices that are based on inputs not quoted on active markets but corroborated by market data.

These inputs include quoted prices for

similar assets or liabilities;

quoted market prices in markets that are not active;

or other inputs that are observable or can be corroborated by observable market data

for substantially the full term of the assets or liabilities.

Unobservable inputs are used when

little or no market data is available.

or other inputs that are observable or can be corroborated

by observable market data for substantially the full term of the assets or liabilities.

inputs are used when little or no market data is available.

Determining fair value requires that we utilize valuation techniques that

maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as consider counterparty

credit risk in the assessment of fair value.

The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value,

we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible,

as well as consider counterparty credit risk in the assessment of fair value.

The Company’s financial instruments consist

principally of cash and cash equivalents, accounts receivable, accounts payable, short-term revolving loans, stockholder promissory notes,

and long-term debt.

The fair value of cash and cash equivalents, accounts receivable, accounts payable, and short-term revolving loans

approximates their respective carrying values because of the short-term nature of those instruments.

The fair value of the stockholder

promissory notes, convertible notes, and long-term debt approximates their respective carrying values because the interest rate approximates

market rates available to the Company for similar obligations with the same maturities.

Basic and Diluted Net Loss Per Share

The basic net loss per share is calculated by dividing

the net loss by the weighted average number of shares outstanding during the period.

Diluted earnings or loss per share adjusts the basic

earnings or loss per share for the potentially dilutive impact of securities (e.g., options and warrants).

We calculate basic and diluted net loss per share

using the weighted average number of common shares outstanding during the periods presented.

In periods of a net loss position, basic

and diluted weighted average common shares are the same.

For the diluted earnings per share calculation, we adjust the weighted average

number of common shares outstanding to include dilutive stock options, warrants, unvested restricted stock units and shares associated

with the conversion of any convertible notes or preferred stock, when applicable.

We use the if-converted method for calculating any potential

dilutive effect of convertible notes and convertible preferred stock on diluted net loss per share.

The following shows the amounts used in computing

net loss per share:

Schedule of net loss per share

Years Ended December 31,

The Company’s

financial instruments consist principally of cash and cash equivalents, accounts receivable, accounts payable, and long-term debt.

fair value of cash and cash equivalents, accounts receivable, and accounts payable approximates their respective carrying values because

of the short-term nature of those instruments.

The fair value of long-term debt approximates their respective carrying values because

the interest rate approximates market rates available to the Company for similar obligations with the same maturities.

and Diluted Net Loss Per Share

Basic net income

or loss per share is calculated by dividing net income or loss by the weighted average number of shares outstanding during the period

without consideration of potentially dilutive securities.

Diluted earnings or loss per share typically adjusts the basic earnings or

loss per share for the potentially dilutive impact of securities.

We calculate both

the basic and diluted net loss per share using the weighted average number of common shares outstanding during the periods presented

without consideration of dilutive securities.

The Company’s potentially dilutive securities, which primarily of outstanding warrants,

options and restricted stock units (“RSUs”), were excluded in the calculation of diluted net loss per share as the result

would have been anti-dilutive due to the Company's net loss position in each period presented.

As a result, the Company’s basic

and diluted earnings per share are equal for the respective periods.

The following shows

the amounts used in computing net loss (basic and diluted) per share:

Ended December 31,

$ ( 6,235,187 )

$ ( 13,479,475 )

Weighted average common shares outstanding – basic and diluted

Basic and diluted net loss per share

As of December 31, 2024 and 2023, the Company has

outstanding warrants, options, and restricted stock units (“RSUs”) convertible into 5,392,395 and 19,167 shares of common

stock, respectively.

The following table sets forth the number of shares excluded from the computation of diluted loss per share, as their

inclusion would have been anti-dilutive.

Schedule of anti-dilutive share

Years ended December 31,

Warrants – Series A

Warrants – Series B

Stock options

Stock-Based Compensation

The Company accounts for stock-based compensation

in accordance with ASC 718, “Compensation—Stock Compensation”, which requires compensation costs to be recognized at

grant date fair value over the requisite service period of each of the awards.

The Company recognizes forfeitures of awards as they occur.

The fair value of stock options is determined using

the Black-Scholes-Merton option pricing model.

In order to calculate the fair value of the options, certain assumptions are made regarding

the components of the model, including risk-free interest rate, volatility, expected dividend yield and expected life.

Changes to assumptions

could cause significant adjustments to the valuation.

New Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, “Segment

Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.” This ASU was issued to clarify reporting requirements for

public entities that are required to report segment information in accordance with Topic 280, Segment Reporting.

The Company will adopt

this standard effective January 1, 2024, but does not anticipate an impact on the Company’s financial statements or disclosures

in this Report, as we currently have one reportable segment.

In March 2023, the FASB issued ASU 2023-02, “Investments—Equity

Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.”

This ASU was issued to allow reporting entities to consistently account for equity investments made primarily for the purpose of receiving

income tax credits and other income tax benefits.

ASU 2023-02 is effective for the Company for fiscal years beginning after December 15,

2023, including interim periods within those fiscal years.

The Company will adopt this standard effective January 1, 2024, but does not

anticipate an impact on the Company’s financial statements or disclosures.

In June 2022, the FASB issued ASU 2022-03, “Fair

Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions,” which amends

the guidance in Topic 820, Fair Value Measurement , to clarify 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 value.

The amendments

also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction.

the ASU introduces new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair

ASU 2022-03 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years

for public business entities.

The Company will adopt this standard effective January 1, 2024, but does not anticipate an impact on the

Company’s financial statements or disclosures.

In July 2023, the FASB issued ASU 2023-03, amending

“Presentation of Financial Statements (Topic 205),” “Income Statement – Reporting Comprehensive Income (Topic

220),” “Distinguishing Liabilities from Equity (Topic 480),” “Equity (Topic 505),” and “Compensation

– Stock Compensation (Topic 718).” The company adopted this standard effective December 15, 2023.

Accounting Guidance Issued but Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, “Income

Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40).” This ASU was issued

to improve the disclosures about an entity’s expenses, and require certain types of expenses to be disclosed individually.

is currently evaluating the impact of this standard on its financial statement.

In March 2024, the FASB issued ASU 2024-02, “Codification

Improvements—Amendments to Remove References to the Concepts Statements,” to address suggestions received from stakeholders.

The Company is currently evaluating the impact of this standard on its financial statements.

In March 2024, the FASB issued ASU 2024-01, “Compensation—Stock

Compensation,” which adds an illustrative example to demonstrate how to apply the guidance in paragraph 718-10-15-3.

is currently evaluating the impact of this standard on its financial statements.

In October 2023, the FASB issued ASU 2023-06, “Disclosure

Improvements:

Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative,” which affects

a variety of Topics in the Codification.

The company is currently evaluating the impact of this standard on our financial statements.

average common shares outstanding – basic and diluted

and diluted net loss per share

As of December 31,

2025 and 2024, the Company had outstanding warrants and options exercisable for, and outstanding RSUs that could be settled for, an aggregate

and 5,392,395

shares of common stock, respectively.

The following table

sets forth the number of shares excluded from the computation of diluted loss per share for the respective periods, as their inclusion

would have been anti-dilutive.

Ended December 31,

Warrants – January

The Company accounts

for stock-based compensation in accordance with ASC 718, “Compensation—Stock Compensation”, which requires compensation

costs to be recognized at grant date fair value over the requisite service period of each of the awards.

The Company recognizes forfeitures

of awards as they occur.

The fair value of

options is determined using the Black-Scholes option-pricing model.

In order to calculate the fair value of options, certain assumptions

and estimates are made with respect to variables such as the expected life of options, volatility of the stock price, risk-free interest

rates, future dividend yields, and estimated forfeitures at the initial grant date.

Changes to these assumptions or estimates could cause

result in significant changes to the valuations.

Accounting Pronouncements

In December 2025,

the FASB issued ASU 2025-11, “Interim Reporting (Topic 270):

Narrow-Scope Improvements.” This ASU was issued to update guidance

on disclosures that should be provided in interim reporting periods.

The Company already complies with the guidance in this ASU, so there

will be no impact on its financial statements or disclosures.

Guidance Issued but Not Yet Adopted

In November 2024,

the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic

220-40).” This ASU was issued to improve the disclosures about an entity’s expenses, and require certain types of expenses

to be disclosed individually, and is effective for annual reporting periods beginning after December 15, 2027.

The Company is currently

evaluating the impact of this standard on its financial statements or disclosures.

Property and Equipment, Net

Property and equipment

Property and equipment consist of the following:

Schedule of property and equipment

Years Ended December 31,

Vehicles and transportation equipment

consist of the following:

of property and equipment

Ended December 31,

transportation equipment

Manufacturing equipment

3 unchanged sentences

accumulated depreciation

Property and equipment, net

Depreciation expense was $ 173,973 and $ 205,723 for

and equipment, net

Depreciation expense

was $ 116,645 and

$ 173,973 for

the years ended December 31, 2025 and 2024, respectively.

There were disposals and sales of fixed assets during the years ended December

31, 2024 and 2023 resulting in the net cash received of $ 132,611 and $ 36,748 , respectively.

As a result of disposals and sales of fixed

assets we recognized losses during the year ended December 31, 2024 and 2023 of $ 146,760 and $ 3,426 , respectively.

The majority of the

disposals in the year ending December 31, 2024 were for equipment and leasehold improvements when we terminated the lease of our second

warehouse in Redmond, Oregon in order to reduce ongoing monthly expenses.

Accrued Expenses and Other

Current Liabilities

Accrued expenses and other current liabilities consist

of the following:

Schedule of accrued expenses and other current liabilities

Years Ended December 31,

Accrued salaries and payroll liabilities

Rebate liability

Deferred income and deposit (sublease)

Accrued interest

Franchise tax

31, 2025 and 2024 resulting in net cash received of $ 4,250

and $ 132,611 ,

respectively, and the recognition of losses of $ 13,353

and $ 146,760 ,

respectively.

The disposals in the year ended December 31, 2025 consisted of the sale of two small vehicles and the exchange of a vehicle

for services rendered.

The disposals in the year ended December 31, 2024 primarily related to sales of equipment and leasehold improvements

arising from the termination of a lease.

Accrued Expenses and Other Current Liabilities

Accrued expenses

and other current liabilities consist of the following:

Ended December 31,

Accrued salaries

and payroll liabilities

Deferred income and deposit

Franchise tax

Accrued interest

expenses and other current liabilities

Long-Term Debt

Long-term debt consisted of the following at December

31, 2024 and 2023:

Schedule of long term debt payment

December 31, 2024

December 31, 2023

Note payable – bank.

Payable in monthly installments of $ 332 , including interest at 5.8 % per annum, due August 2025 , secured by equipment and personally guaranteed by a co-founder.

Note payable – credit union.

Payable in monthly installments of $ 508 , including interest at 5.45 % per annum, due July 2026 , secured by a vehicle and personally guaranteed by a co-founder.

This note was paid in full in March 2024.

Long-term debt consisted

of the following at December 31, 2025 and 2024:

Payable in monthly installments of $ 332 ,

including interest at 5.8 %

per annum, secured by equipment.

This note was repaid in full in August

Note payable – credit

Payable in monthly installments of $ 508 ,

including interest at 5.45 %

per annum, , secured by a vehicle.

This note was repaid in full in March

Note payable – SBA:

Economic Injury Disaster Loan payable in monthly installments of $ 731 , including interest at 3.75 % per annum, due May 2050 , and personally guaranteed by a co-founder.

Notes payable – The Company has acquired six notes payable to GM Financial for vehicles.

In April 2022, the Company secured a commercial line up to $300,000 to be used to finance vehicle purchases.

The agreement expired in April 2023 but was renewed for a commercial line up to $350,000 and prevailing GM Financial existing term notes will remain.

The new agreement expires in April 2024.

One note was paid off when the corresponding vehicle was sold in May 2023, so there are five notes remaining at December 31, 2024.

The notes are currently payable in aggregate monthly installments of $ 4,084 , including interest at rates ranging from 5.89% to 7.29% per annum, mature at various dates from October 2027 to May of 2028 , and are secured by the related vehicles.

Two of the notes are personally guaranteed by a co-founder.

Two of the notes were paid in full in February 2024;

these notes had a combined principal balance of $ 72,115 as of December 31, 2024.

Less current portion

Long-term debt, net of unamortized debt discount and current portion

Future maturities of long-term debt are as follows:

Schedule of maturities of long-term debt

The Economic Injury Disaster Loan is payable in monthly installments of $ 731 ,

including interest at 3.75 %

per annum, matures in May

2050 , and is unsecured.

payable – The Company has acquired six notes payable to GM Financial for vehicles.

April 2022, the Company secured a commercial line up to $300,000 to be used to finance vehicle purchases.

The original agreement

expired in April 2023 but was renewed for a commercial line up to $350,000 with prevailing GM Financial existing terms each year

The current agreement expires in April

One note was paid off when the corresponding vehicle was sold in May 2023, two notes were paid off when the corresponding

vehicles were sold in February 2024, and three notes remain outstanding as of December 31, 2025.

The notes are currently payable

in aggregate monthly installments of $ 2,560 ,

including interest at rates ranging from 6.14%

to 7.29% per annum, mature at various dates

2027 to May of 2028 , and are secured by the

related vehicles.

current portion

debt, net of unamortized debt discount and current portion

Future maturities

of long-term debt are as follows:

of maturities of long-term debt

Years ending December 31,

Promissory Notes

As of December 31, 2024 and December 31, 2023, the

Company had an outstanding principal balance of $ 0 and $ 762,500 due to stockholders under unsecured Promissory Notes Agreements (“Notes”).

The Notes require monthly interest-only payments at 10 % per annum.

The Notes would have matured in September 2024 and December 2024 as

September 2024 - $500,000 (this Note would have matured in August 2023, but in June 2023, an agreement was signed extending the

maturity date to August 2024, and in June 2024, an agreement was signed further extending the maturity date to September 2024);

2024 - $200,000.

A note for $62,500 that matured in January 2024 was paid in January 2024, and Notes for $500,000 that matured in September

2024 and $200,000 that matured in December 2024 were both paid in August 2024.

As of December 31, 2024, there were no Notes outstanding.

Interest paid to the stockholders under the Notes

totaled $ 42,862 and $ 82,508 during the years ended December 31, 2024 and 2023, respectively.

There was no accrued interest as of December

31, 2024 or 2023 related to these Notes.

The Company previously

issued unsecured promissory notes to certain stockholders (the “Stockholder Notes”).

As of December 31, 2025 and 2024, the

Company had no

outstanding principal balance due pursuant to the Stockholder

Notes, which were fully repaid in August 2024.

Interest paid to

stockholders under the Stockholder Notes totaled $ 0

during the years ended December 31, 2025 and 2024, respectively.

accrued interest under the Stockholder Notes as of December

31, 2025 or 2024.

Equity and Debt Financings

August 2024 Public Offering

On August 8, 2024, the Company sold

in the August 2024 Public Offering, (i) 33,402,000 Common Units, (pre-Reverse Stock Split), each consisting of one share of common stock,

two Series A Warrants and one Series B Warrant, and (ii) 16,598,000 Pre-Funded Units (pre-Reverse Stock Split), each consisting of one

Pre-Funded Warrant, two Series A Warrants, and one Series B Warrant, through the Underwriter.

In addition, the Company granted

the Underwriter a 45-day option to purchase additional shares of common stock and/or Pre-Funded Warrants and/or Series A Warrants and/or

Series B Warrants, representing up to 15% of the number of the respective securities sold in the August 2024 Public Offering, solely to

cover over-allotments, if any.

The Underwriter partially exercised its over-allotment option with respect to 15,000,000 Series A Warrants

and 7,500,000 Series B Warrants (pre-Reverse Stock Split).

The Common Units were sold at a

price of $ 0.20 per unit and the Pre-Funded Warrants were sold at a price of $ 0.199 per unit (pre-Reverse Stock Split).

The Pre-Funded Warrants were immediately

exercisable at an exercise price of $ 0.001 per share (Pre-Reverse Stock Split) and could be exercised at any time until all Pre-Funded

Warrants are exercised in full.

As of December 31, 2024, all Pre-Funded Warrants have been exercised.

Each Series A Warrant is exercisable

at any time or times beginning on September 30, 2024, which was the first trading day following the Company’s notice to the Series

A Warrant holders of stockholder approval received at the Company’s annual meeting of stockholders held on September 27, 2024 (the

“2024 Annual Meeting”), and will expire five years from such date.

Each Series A Warrant was initially exercisable at an exercise

price of $ 24.00 per share of common stock (post-Reverse Stock Split).

The exercise price of the Series A Warrants was subject to reduction

on the 11 th trading day after the stockholder approval to the greater of the lowest daily volume weighted average price (“VWAP”)

during the ten trading day period following the stockholder approval and the floor price of $ 5.206 (representing 20% of the lower of our

common stock’s closing price on The Nasdaq Capital Market on the date that we priced the August 2024 Public Offering (post-Reverse

Stock Split) or our common stock’s average closing price on The Nasdaq Capital Market for the five trading days ending on such date

(such lower price, without giving effect to such 20% reduction, the “Nasdaq Minimum Price”), and the number of shares issuable

upon exercise would be proportionately adjusted such that the aggregate exercise price would remain unchanged.

As of September 30, 2024, there

would have been 5,301,592 shares of common stock (post-Reverse Stock Split and assuming the Adjustment had occurred on September

30, 2024) issuable upon exercise of the Series A Warrants.

Subsequent to September 30, 2024, the exercise price under the Series A Warrants

was reduced to the floor price of $ 5.206 (representing 20% of the Nasdaq Minimum Price, post-Reverse Stock Split), beginning on October

14, 2024, the 11 th trading day following stockholder approval.

As of December 31, 2024, 14,900 shares of common stock have

been issued upon exercise of Series A Warrants and 5,286,692 shares of Common stock remain issuable upon exercise of Series A Warrants.

Each Series B Warrant was exercisable

immediately upon issuance at an exercise price of $0.10 per share (post-Reverse Stock Split).

The number of shares of common stock issuable

under the Series B Warrants were subject to adjustment using a reset price based on the weighted average price of common stock over a

rolling five-trading-day period between the issuance date of the Class B Warrants and the close of trading on the tenth trading day following

stockholder approval, subject to certain floor prices.

As of September 30, 2024, 342,588 shares of Common stock (post-Reverse Stock Split)

had been issued upon exercise of Series B Warrants and there were 1,032,198 shares of Common stock (post-Reverse Stock Split) issuable

upon exercise of Series B Warrants based on the reset price of $ 5.45 (representing the lowest arithmetic average

of the daily VWAP during the 5 trading day period from September 12, 2024 through September 18, 2024.

Effective October 8, 2024, after

market close, a reverse stock split occurred and as of November 12, 2024, 87,384 shares of common stock remain issuable upon exercise

of Series B Warrants using the reset price, which was reduced to the floor price of $ 5.206 (representing 20% of the Nasdaq Minimum Price

(post-Reverse Stock Split and post-Adjustment).

Pursuant to an underwriting agreement

by and between the Company and the Underwriter, the Company paid the Underwriter a total cash underwriting discount of $ 700,000 , equal

to 7% of gross proceeds received in the August 2024 Public Offering, reimbursement for Underwriter expenses of $ 100,000 , equal to 1% of

gross proceeds received, and reimbursement for road show, diligence, legal fees and disbursements of $ 100,000 , equal to 1% of gross proceeds

received, as well as $ 5,000 for investor counsel fee, totaling $ 905,000 in cash fees deducted from cash proceeds.

Convertible Note Financing

On December 27, 2023, the Company entered into a securities

purchase agreement with 3i, LP (“3i”), pursuant to which the Company sold and 3i purchased:

October 2025 Private

On October 16, 2025,

the Company entered into a securities purchase agreement (the “Purchase Agreement”) with two institutional investors pursuant

to which the Company agreed to sell in a private placement (the “October 2025 Private Placement”) an aggregate of (i) 613,077

shares of common stock, and (ii) a pre-funded warrant (the

“October 2025 Pre-Funded Warrant”) to purchase up to 144,498

shares of common stock.

The offering price per share was $1.65

and the offering price per pre-funded warrant share was $1.649.

The Company received

net proceeds of approximately $1.1 million from the October 2025 Private Placement after deducting offering expenses payable by the Company.

The Company used the net proceeds from the offering to pay severance obligations to certain executive officers that transitioned concurrent

with the completion of the October 2025 Private Placement, and for working capital and other general corporate purposes.

The October 2025

Pre-Funded Warrant is exercisable immediately upon issuance for cash or on a cashless basis at the discretion of the holder.

price of the October 2025 Pre-Funded Warrant is $0.001 per share.

The number of pre-funded warrant shares that may be issuable is subject

to adjustment for stock splits, recapitalizations, and reorganizations.

The holder of the October 2025 Pre-Funded Warrant does not have

any voting rights, but does have the right to participate in any dividends or distributions made by the Company.

The offer and sale

of the securities in the October 2025 Private Placement was made pursuant to the exemption from the registration requirements of the

Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(a)(2) of the Securities Act and Rule 506

promulgated thereunder.

January 2025 Public

In January 2025,

the Company sold in a public offering (the “January 2025 Public Offering”) (i) 474,193

shares of common stock, (ii) pre-funded warrants (the “January

2025 Pre-Funded Warrants”) to purchase 574,193

shares of common stock, which were exercised immediately upon

closing, and (iii) warrants to purchase 1,048,386

shares of common stock at an exercise price of $2.36 per share

(the “January 2025 Warrants”).

The offering price per share was $2.48 and the offering price per pre-funded warrant share

The Company received

net proceeds of approximately $1.8 million from the January 2025 Public Offering after deducting offering expenses payable by the Company.

The Company used the net proceeds from the offering to pay certain obligations under the Series A Warrants (as defined below), and for

working capital and other general corporate purposes.

The January 2025

Pre-Funded Warrants are exercisable immediately upon issuance for cash or on a cashless basis at the discretion of the holder.

price of the January 2025 Pre-Funded Warrants is $0.001 per share.

The number of pre-funded warrant shares that may be issuable is subject

to adjustment for stock splits, recapitalizations, and reorganizations.

The holders of the January 2025 Pre-Funded Warrants do not have

any voting rights, but do have the right to participate in any dividends or distributions made by the Company.

The fair value of

the January 2025 Warrants was determined at the date of issuance using the Black-Scholes option-pricing model based on the following

estimates and assumptions:

a per share price of common stock on date of grant of $ 2.22 ;

expected dividend yield of 0 %;

expected volatility of 158.64 %;

risk-free interest rate of 4.41 %;

and expected life of five

The warrants were valued at $2.064 per share, with a

total value of $2,163,869.

The offer and sale

of the securities in the January 2025 Public Offering was made pursuant to an effective shelf registration statement on Form S-3 (File

333-272956), which the Company filed with the SEC on June 27, 2023 and was declared effective on July 10, 2023 (the “Shelf

Registration Statement”).

The offer and sale of the January 2025 Warrants was made pursuant to a registration statement on Form

S-1 (File No.

333-284354), which the Company filed with the SEC on January 17, 2025 and was declared effective on February 11, 2025.

On August 14, 2025,

the Company entered into inducement offer letter agreements with certain holders of the January 2025 Warrants, which reduced the exercise

price of the January 2025 Warrants from $ 2.36

per share to $1.31 per share in exchange for the prompt exercise

by such holders of the warrants for cash (the “Warrant Inducement”).

The difference between the fair value of the warrants

immediately prior to and following modification was calculated using the Black-Scholes option-pricing model and treated as a transaction

cost, and resulted in $97,746 being netted against the proceeds received from the January 2025 Warrants.

As a result of the Warrant Inducement,

January 2025 Warrants covering an aggregate of 599,193

shares of common stock were exercised, resulting in net proceeds

to the Company of approximately $0.8 million.

On August 22, 2025, the Company’s board of directors took action to permanently reduce

the exercise price of the January 2025 Warrants from $2.36 per share to $1.31 per share (the “Exercise Price Reduction” and,

together with the Warrant Inducement, the “Warrant Adjustments”).

As of December 31, 2025, January 2025 Warrants covering

an aggregate of 449,193 shares

of common stock remained outstanding.

Reverse Stock Split

Cash True-Up Payment

On October 8, 2024,

the Company effected a 1-for-100 reverse stock split (the “Reverse Stock Split”) of its issued and outstanding shares of

common stock, which was approved by the Company’s board of directors on September 27, 2024, following stockholder approval at the

Company’s annual meeting of stockholders held on September 27, 2024 (the “2024 Annual Meeting”).

As a result of the

lowest daily volume weighted average price (“VWAP”) of the common stock during the five trading days before and after the

Reverse Stock Split being below the minimum threshold set forth in the Series A Warrants, a Reverse Stock Split cash true-up payment

provision in the Series A Warrants was triggered (the “Cash True-up Payment”).

The Cash True-Up Payment was capped at $5.0

million in the aggregate, but the payment was initially suspended in accordance with the terms of the Series A Warrants.

See the section

titled “—August 2024 Public Offering” for additional information.

During the year ended

December 31, 2024, $14,052 of the Cash True-up Payment was relieved in connection with the exercise of certain Series A Warrants, leaving

a remaining liability of $4,985,948 as of December 31, 2024.

The Company used

$500,000 of the net proceeds from the January 2025 Public Offering to satisfy a portion of the Cash True-up Payment, leaving a remaining

liability of $ 4,485,948 .

On August 14, 2025,

in connection with the Warrant Inducement, the Company entered into inducement offer letter agreements with certain holders of the Series

A Warrants, which reduced the exercise price of the Series A Warrants from $5.206 per share to $1.31 per share in exchange for the prompt

exercise by such holders of the warrants for cash.

The Warrant Inducement had the effect of eliminating the Cash True-up Payment obligation

pursuant to the terms of the Series A Warrants.

As a result, the Cash True-up Payment liability of $ 4,485,948

was no longer payable, and this amount was recorded as a credit

to Other income / (expense) on the Statement of Operations.

As of December 31, 2025, the Cash True-up Payment liability balance was $0.

2024 Public Offering

August 8, 2024, the Company issued and sold in a public offering (the “August 2024 Public Offering”) (i) 33,402,000

common units (pre-Reverse Stock Split), each consisting of

one share of common stock, two Series A Warrants and one Series B Warrant (collectively, the “Common Units”), and (ii) 16,598,000

pre-funded units (pre-Reverse Stock Split), each consisting

of one pre-funded warrant (the “August 2024 Pre-Funded Warrant”), two Series A Warrants, and one Series B Warrant (collectively,

the “Pre-Funded Units”).

The Common Units were sold at a price of $0.20 per unit and the Pre-Funded Units were sold at a

price of $0.199 per unit (pre-Reverse Stock Split).

addition, the Company granted the underwriter a 45-day option to purchase additional shares of common stock and/or August 2024 Pre-Funded

Warrants and/or Series A Warrants and/or Series B Warrants, representing up to 15% of the number of the respective securities sold in

the August 2024 Public Offering, solely to cover over-allotments, if any.

The underwriter partially exercised its over-allotment option

with respect to 15,000,000

Series A Warrants (pre-Reverse Stock Split) and 7,500,000

Series B Warrants (pre-Reverse Stock Split).

Pre-Funded Warrants were immediately exercisable at an exercise price of $ 0.001

per share (pre-Reverse Stock Split).

As of December 31, 2024,

all Pre-Funded Warrants had been exercised.

Company received net proceeds of approximately $8.7 million from the August 2024 Public Offering after deducting offering expenses payable

by the Company.

The Company used the net proceeds from the offering to satisfy its obligations pursuant to the 3i Note (as defined below),

to satisfy its obligations under the Termination Agreement (as defined below), and for working capital and other general corporate purposes.

Series A Warrant became exercisable on September 30, 2024, and will expire five years from such date.

Each Series A Warrant was initially

exercisable at an exercise price of $24.00 per share of common stock (post-Reverse Stock Split).

The exercise price of the Series A Warrants

was subsequently reduced to $5.206 (post-Reverse Stock Split) consistent with the terms of the Series A Warrants.

August 14, 2025, in connection with the Warrant Inducement, the exercise price of the Series A Warrants was further reduced to $1.31

The difference between the fair value of the warrants immediately prior to and following modification was calculated using

the Black-Scholes option-pricing model and treated as a transaction cost, and resulted in $1,423,166 being netted against the proceeds

received from the Series A Warrants.

As a result of the Warrant Inducement, an aggregate of 95,112,212 Series A Warrants were exercised,

resulting in the issuance of an aggregate of 4,384,749 shares of common stock, resulting in net proceeds to the Company of $4,918,695.

August 22, 2025, in connection with the Exercise Price Reduction, the exercise price of all of the outstanding Series A Warrants was

reduced from $5.206 per share to $1.31 per share.

As of December 31, 2025, Series A Warrants to purchase an aggregate of 901,943 shares

of common stock remain outstanding.

Series B Warrant was exercisable immediately upon issuance at an exercise price of $0.10 per share (post-Reverse Stock Split).

2025, 85,252 shares of common stock were issued upon exercise of Series B Warrants, resulting in net proceeds to the Company of $8,525.

As of December 31, 2025, Series B Warrants to purchase an aggregate of 2,132 shares of common stock remain outstanding.

offer and sale of securities in the August 2024 Public Offering was made pursuant to an effective shelf registration statement on Form

S-1 (File No.

333-280996), which the Company initially filed with the SEC on July 25, 2024 and was declared effective on August 6, 2025.

Convertible Note

On December 27, 2023,

the Company entered into a securities

purchase agreement with 3i, LP (“3i”), pursuant to which the Company issued and sold:

(i) a senior unsecured convertible

note issued in the aggregate principal amount of $2,750,000, with an 10.0% original issue discount and an interest rate of 9.0% per annum

(the “3i Note”), (ii) up to $247,500 in newly issued shares of Common stock (the “Interest Shares”), which may

be payable, subject to the fulfillment of certain conditions set forth in the 3i Note, to satisfy interest payments under the 3i Note,

and (iii) 635 shares of Common stock issued to 3i as consideration for its commitment to purchase the 3i Note (collectively, the “Convertible

note in the aggregate principal amount of $2,750,000, with a 10.0% original issue discount and an interest rate of 9.0% per annum (the

“3i Note”), (ii) up to $247,500 in newly issued shares of common stock, which were payable, subject to the fulfillment of

certain conditions set forth in the 3i Note, to satisfy interest payments under the 3i Note (the “Interest Shares”), and

(iii) 635 shares of common stock issued to 3i as consideration for its commitment to purchase the 3i Note (collectively, the “Convertible

Note Financing”).

The gross proceeds to the Company from the Convertible Note Financing were $2.5 million prior to the payment of

legal fees and transaction expenses.

The offering of securities in the Convertible Note Financing was made pursuant to an effective shelf

registration statement on Form S-3 (File No.

333-272956), which the Company filed with the SEC on June 27, 2023 and was declared effective

on July 10, 2023.

On August 8, 2024, in connection with the closing

of the August 2024 Public Offering, the Company repaid the 3i Note, and the Company’s obligations under the 3i Note were fully satisfied

and discharged.

Prior to the closing of the August 2024 Public Offering, the Company had issued 414 shares of common stock (post-Reverse

Stock Split) for the payment of $ 90,839 in interest.

The Company received

net proceeds of approximately $1.8 million from the Convertible Note Financing after deducting related expenses payable by the Company.

The Company used the net proceeds for working capital and other general corporate purposes.

The offer and sale

of securities in the Convertible Note Financing was made pursuant to the Shelf Registration Statement.

On August 8, 2024,

in connection with the closing of the August 2024 Public Offering, the Company repaid the 3i Note, and the Company’s obligations

under the 3i Note were fully satisfied and discharged.

Prior to the satisfaction of the amounts owed pursuant to the 3i Note, the Company

issued 414 shares of common stock (post-Reverse Stock Split) for the payment of $90,839 in interest.

Equity Line of Credit

On December 27, 2023, the Company entered into a common

stock purchase agreement with Tumim Stone Capital, LLC (“Tumim”), pursuant to which the Company has the right, but not the

obligation, to sell to Tumim, and Tumim is obligated to purchase, up to the lesser of (a) $20,000,000 in aggregate gross purchase price

of newly issued Common stock and (b) the Exchange Cap (as defined in the purchase agreement) (the “Equity Line of Credit”).

In connection with the Equity Line of Credit, the Company filed a Registration Statement on Form S-1 (File No.

333-276663) with the SEC

on January 23, 2024, which was declared effective on February 9, 2024.

In connection with the August 2024 Public Offering,

the Company and Tumim mutually agreed to terminate the Equity Line of Credit, effective immediately upon the closing of the August 2024

Public Offering.

Prior to the closing of the August 2024 Public Offering, the Company had sold 4,336 shares of common stock (post-Reverse

Stock Split) under the Equity Line of Credit for an aggregate amount of $ 828,491 , of which $ 434,958 was used to repay a portion of the

balance under the 3i Note, consisting of $ 380,042 to the loan principal, $ 34,204 to interest, and $ 20,712 as a redemption premium.

Stock Split True-Up Payment

as of 5:00 p.m.

Pacific Time on October 8, 2024 (the “Effective Date”), The Company effected a 1-for-100 reverse stock split

of our common stock (the “Reverse Stock Split”), which was approved by the Board on September 27, 2024, following stockholder

approval at our annual meeting of stockholders held on September 27, 2024.

of the daily VWAP of the common stock during the five trading days before and after the Reverse Stock Split, a Reverse Stock Split cash

true-up payment provision in the Series A Warrants, which is capped at $5.0 million in the aggregate under all Series A Warrants, was

triggered, but the payment of the Reverse Stock Split cash true-up payment was suspended in accordance with the terms of the Series A

year ended December 31, 2024, $14,052 of this liability was relieved in connection with the exercise of Series A Warrants, leaving a remaining

liability of $ 4,985,948 as of December 31, 2024.

We used $ 500,000 of the net proceeds from the registered direct offering and warrant

private placement that closed on January 3, 2025 to satisfy a portion of certain amounts owed to the holders of the Series A Warrants

pursuant to the terms thereof.

December 27, 2023, the Company entered into a common stock purchase agreement with Tumim Stone Capital, LLC (“Tumim”), pursuant

to which the Company had the right, but not the obligation, to sell to Tumim, and Tumim was obligated to purchase, up to the lesser of

(a) $20,000,000 in aggregate gross purchase price of newly issued shares of common stock and (b) the Exchange Cap (as defined in the

common stock purchase agreement) (the “Equity Line of Credit”).

The offer and sale

of shares to Tumim pursuant to the Equity Line of Credit was made pursuant to the exemption from the registration requirements of the

Securities Act, provided by Section 4(a)(2) of the Securities Act and Rule 506 promulgated thereunder.

The resale of the shares sold

to Tumim was registered pursuant to a Registration Statement on Form S-1 (File No.

333-276663) filed with the SEC on January 23, 2024,

which was declared effective on February 9, 2024.

In connection with the August 2024 Public

Offering, the Company and Tumim mutually agreed to terminate the Equity Line of Credit.

Prior to termination, the Company had sold 4,336

shares of common stock under the Equity Line of Credit for

an aggregate amount of $ 828,491 ,

of which $ 434,958

was used to repay a portion of the Company’s obligations

under the 3i Note.

Commitments and Contingencies

Operating Leases

The Company leases its warehouses and office space

under long-term lease arrangements.

None of its leases include characteristics specified in ASC 842, Leases , that require classification

as financing leases, and accordingly, these leases are accounted for as operating leases.

The Company does not recognize a right-of-use

asset and lease liability for short term leases, which have terms of 12 months or less.

For longer-term lease arrangements that are recognized

on the Company’s Balance Sheet, the right-of-use asset and lease liability are initially measured at the commencement date based

upon the present values of the lease payments due under the leases.

The implicit interest rates of the Company’s

lease arrangements are generally not readily determinable and as such, the Company applies an incremental borrowing rate, which is established

based upon the information available at the lease commencement date, to determine the present value of lease payments due under the arrangement.

Under ASC 842, the incremental borrowing rate (“IBR”) for leases must be (1) a rate of interest over a similar term, and (2)

for an amount that is equal to the lease payments.

The Company uses both the Federal Reserve Economic Data U.S.

corporate debt effective

yield and the U.S.

Treasury rates adjusted for credit spread as the primary data points for purposes of determining the IBR.

In the first quarter of 2022, the Company entered

into two new long-term, non-cancelable operating lease agreements for office and warehouse space resulting in the Company recognizing

an additional lease liability of $ 2,348,509 , representing the present value of the lease payments discounted using an effective interest

rate of 8.07% and 8.86% , and corresponding ROU assets of $ 2,348,509 .

The leases expire in December 2026 and December 2028 , the latter

of which contains one three-year option to renew.

In the first quarter of 2021, the Company entered

into a long-term, non-cancelable operating lease agreement for office and warehouse space resulting in the Company recognizing an additional

lease liability totaling of $ 1,268,089 , representing the present value of the lease payments discounted using an effective interest rate

of 7.47% and a corresponding ROU asset of $ 1,268,089 .

The Company leases

its warehouses and office space under long-term lease arrangements.

All of the Company’s leases are accounted for as operating

For longer-term lease arrangements that are recognized on the Balance Sheets, the ROU asset and lease liability are initially

measured at the commencement date based upon the present values of the lease payments.

The Company does not recognize a ROU asset and

lease liability for short term leases, which have terms of 12 months or less.

See “Note 2, Summary of Significant Accounting Policies—Leases”

for additional information.

In May 2025, the

Company entered into a long-term, non-cancelable operating lease agreement for warehouse space next door to the existing office and warehouse

space in Redmond, Oregon, resulting in the Company recognizing an additional ROU asset and corresponding lease liability of $ 198,216 ,

representing the present value of the lease payments discounted using an IBR of 13.49% .

The lease expires in April 2028 and provides for one three-year option to renew.

In January and February

2022, the Company entered into two long-term, non-cancelable operating lease agreements for office and warehouse space resulting in the

Company recognizing an additional ROU asset and corresponding lease liability of $ 2,348,509 ,

representing the present value of the lease payments discounted using an IBR of 8.07%

respectively.

One lease was terminated in September 2024, and the remaining lease expires in December 2026.

In January 2021,

the Company entered into a long-term, non-cancelable operating lease agreement for office and warehouse space resulting in the Company

recognizing an additional ROU asset and lease liability of $ 1,268,089 ,

representing the present value of the lease payments discounted using an IBR of 7.47% .

The lease expires in January 2028 and contains one three-year option to renew.

The Company had another lease that expired in January

2023 and was terminated at that time.

The relating right of use asset and lease liability were written off at that time.

The company has

one further lease that expires in February 2025.

The leases generally provide for annual increases based on a fixed amount and generally

require the Company to pay real estate taxes, insurance, and repairs.

On September 19, 2024, the Company signed a Termination

of Commercial Lease Agreement regarding the lease previously contracted to end in December 2028.

The cancelation was effective September

The corresponding ROU asset and lease liability were therefore removed from the Company’s balance sheet effective September

The following is a summary of total lease costs for

the years ending December 31, 2024 and 2023:

Schedule of lease cost

Years Ended December 31,

Operating lease cost

The Company had three

additional leases relating to office and warehouse space that were terminated in January 2023, September 2024, and February 2025, respectively.

The related ROU assets and lease liabilities were removed from the Balance Sheets at the time of termination.

The Company’s

operating leases generally provide for fixed annual increases and require the Company to pay real estate taxes, insurance, and repairs.

The following is

a summary of total lease costs for the years ending December 31, 2025 and 2024:

Ended December 31,

Operating lease

Short-term lease costs

Variable lease costs

Sublease income

Total lease costs

The weighted-average remaining lease term was 2.91

and 4.54 years as of December 31, 2024 and 2023, respectively.

The weighted average discount rate was 7.60 % and 8.47 % as of December 31,

2024 and 2023, respectively.

Operating cash flows from the operating leases totaled $ 455,690 and $ 469,923 for the years ended December

31, 2024 and 2023, respectively.

The total lease liability as of December 31, 2024

and 2023 was $ 798,917 and $ 2,764,089 , respectively.

The following is a maturity analysis of the annual

undiscounted cash flows of the operating lease liabilities as of December 31, 2024, for years ending December 31:

Schedule of future minimum lease payment

The weighted-average

remaining lease term was 2.06

years as of December 31, 2025 and 2024, respectively.

The weighted-average

IBR was 8.99 %

as of December 31, 2025 and 2024, respectively.

Operating cash flows from the operating leases totaled $287,409 and $455,690 for the

years ended December 31, 2025 and 2024, respectively.

The total lease liability

as of December 31, 2025 and 2024 was $ 709,724

and $ 798,917 ,

respectively.

The following is

a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities as of December 31, 2025, for years ending

Total future minimum lease payments

2 unchanged sentences

Noncurrent lease liability

As of December 31, 2024, the Company subleases office

and warehouse space under one of its existing operating leases with similar terms as the Company’s lease agreements.

Two additional

leases ended in February, 2023.

Because the Company is not relieved of its primary obligations under the original lease, the Company accounts

for the subleases as a lessor.

Sublease rental income is recorded based on the contractual rental payments which are not substantially

different from recognition on a straight-line basis over the lease term and totaled $ 42,804 and $ 49,916 during the years ended December

31, 2024 and 2023, respectively.

As of December 31, 2024 and 2023, deferred income and a sublease deposit totaled $ 4,549 and $ 4,445 , respectively,

and is included in accrued expenses and other current liabilities on the accompanying Balance Sheets.

The total future minimum sublease payments are $ 7,169 ,

all due in the year ending December 31, 2025.

The Company may be involved from time to time in litigation

or claims arising in the ordinary course of its business.

While the ultimate liability, if any, arising from these claims cannot be determined

with certainty, the Company believes that the resolution of any such matters will not likely have a material adverse effect on the Company’s

financial statements.

On November 22, 2022, the Company received

notice of a complaint (the “Complaint”) filed against it in Oregon state court by Ravi Sinha.

The Complaint alleged, inter

alia , that Mr.

Sinha was entitled to 282,284 shares of the Company's common stock, or

in the alternative, $300,000 plus interest in connection with services he previously rendered the Company as its chief executive officer.

On March 21, 2023, the Company entered into a settlement agreement with Mr.

Sinha and the matter has been resolved with $ 30,000 cash and

the issuance of 52,000 shares of common stock at the closing price of $ 4.84 per share on March 31, 2023, for a total settlement value

of $ 281,680 .

(see Note 11, Stockholders’ Equity ).

On May 2, 2024,

the Company entered into a Settlement and Mutual Release with Alexander Capital L.P.

(“Alexander”), pursuant to which the

parties resolved certain disputes while not admitting any liability or wrongdoing (the “Settlement Agreement”).

to (i) make a single cash payment of $100,000, (ii) issue 100,000 shares of Common Stock, and (iii) amend certain outstanding warrants

to reduce the per share exercise price from $9.10 to $4.50.

The shares of Common Stock were issued pursuant to an effective Registration

Statement on Form S-3 (File No.

The Settlement Agreement also contains other customary provisions, including a mutual release

of claims and mutual non-disparagement provision.

As of December 31,

2024, the Company subleased office and warehouse space under one of its operating leases with similar terms as the Company’s lease

The Company’s lease and corresponding sublease for that property expired in February 2025 and were not renewed.

additional subleases ended in February 2023.

Because the Company was not relieved of its primary obligations under the original lease,

the Company accounted for the subleases as a lessor.

Sublease rental income was recorded based on the contractual rental payments, which

were not substantially different from recognition on a straight-line basis over the lease term.

Sublease rental income totaled $ 7,169

during the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025 and 2024, deferred sublease income and a sublease deposit totaled $ 0

and $ 4,549 ,

respectively, and is included in accrued expenses and other current liabilities on the Balance Sheets.

The Company has no

subleases as of December 31, 2025.

The Company may be

involved from time to time in litigation or claims arising in the ordinary course of its business.

While the ultimate liability, if any,

arising from these claims cannot be determined with certainty, the Company believes that the resolution of any such matters are not reasonably

likely have a material adverse effect on the Company’s financial condition, operating results or cash flows.

On May 2, 2024, the

Company entered into a Settlement Agreement and Mutual Release (the “Settlement Agreement”) with Alexander Capital L.P.

(“Alexander”),

pursuant to which the parties resolved certain disputes while not admitting any liability or wrongdoing (the “Settlement Agreement”).

Pursuant to the Settlement Agreement, the Company agreed to (i)

make a single cash payment of $100,000, (ii) issue 100,000 shares of common stock, and (iii) amend certain outstanding warrants held

by Alexander to reduce the per share exercise price from $9.10 to $4.50.

The shares of common stock were issued pursuant to the Shelf

Registration Statement.

The Settlement Agreement

also contained other customary provisions, including a mutual release of claims and mutual non-disparagement provision.

On July 1, 2024,

the Company entered into a Mutual Termination Agreement with Alexander (the “Termination Agreement”), pursuant to which the

parties agreed to terminate a certain provision in that certain underwriting agreement, dated March 31, 2022, between the Company and

Alexander, as representative of the underwriters, which granted Alexander a right of first refusal to act as the Company’s financial

advisor, book-runner, book-running manager, manager, placement agent, or underwriter in connection with any transaction contemplated or

consummated by us (the “ROFR Provision”).

In exchange for the termination of the ROFR Provision, and in connection with the

closing of the 2024 Public Offering, the Company made a cash payment to Alexander in the amount of $ 400,900 .

the Company entered into a Mutual Termination Agreement (the “Termination Agreement”) with Alexander, pursuant to which the

parties agreed to terminate a provision in the Underwriting Agreement, dated March 31, 2022, entered into by and between the Company

and Alexander, which granted Alexander a right of first refusal to act as the Company’s financial advisor, placement agent or underwriter

in connection with certain financing transactions (the “ROFR Provision”).

In exchange for the termination of the ROFR Provision,

and in connection with the closing of the August 2024 Public Offering, the Company made a cash payment to Alexander in the amount of

Nasdaq Listing Requirement

On September 6, 2024, the Company received a staff

determination from The Nasdaq Listing Qualifications Department of The Nasdaq Stock Market (“Nasdaq”) to delist the Company’s

common stock from The Nasdaq Capital Market indicating that (i) the Company was not in compliance with Nasdaq Listing Rule 5550(a)(2)

because the closing bid price per share for the Company’s common stock had closed below $1.00 for the previous 30 consecutive business

days, and (ii) the Company is subject to the provisions contemplated under Nasdaq Listing Rule 5810(c)(3)(A)(iii) because, as of September

5, 2024, the Company’s common stock had a closing bid price of $0.10 or less for at least ten consecutive trading days (the “Staff

Determination”).

On September 12, 2024, the Company requested an appeal

hearing on the Staff Determination from a Hearings Panel (the “Panel”) by filing a hearing request with Nasdaq pursuant to

the procedures set forth in the Nasdaq Listing Rules, staying the delisting of the common stock pending the Panel’s decision.

Upon successful completion of the Reverse Stock Split,

the Company received a letter from the Nasdaq Office of General Counsel on October 23, 2024, advising the Company that it had regained

compliance with the minimum bid price continued listing requirements in Listing Rule 5550(a)(2) and that the Company is therefore in compliance

with Nasdaq’s listing requirements.

Consequently, the scheduled hearing before the Panel on October 24, 2024, was cancelled.

The Company’s common stock continues to be listed and traded on The Nasdaq Capital Market.

See Note 14 – “Subsequent Events”

in this Quarterly Report for additional information about the Reverse Stock Split and the Nasdaq Listing Requirement.

On September 6, 2024,

the Company received a determination from The Nasdaq Listing Qualifications Department (the “Staff”) of The Nasdaq Stock

Market (“Nasdaq”) to delist the common stock from the Nasdaq Capital Market indicating that (i) the Company was not in compliance

with Nasdaq Listing Rule 5550(a)(2) because the closing bid price for the common stock had closed below $1.00 for the previous 30 consecutive

business days, and (ii) the Company was subject to Nasdaq Listing Rule 5810(c)(3)(A)(iii) because, as of September 5, 2024, the common

stock had a closing bid price of $0.10 or less for at least ten consecutive trading days (the “September 2024 Staff Determination”).

On September 12,

2024, the Company requested an appeal hearing with respect to the September 2024 Staff Determination from the Nasdaq Hearings Panel (the

“Panel”), which had the effect of staying the delisting of the common stock pending the Panel’s decision.

Upon completion of

the Reverse Stock Split, the Company received a letter from the Staff on October 23, 2024, advising the Company that it had regained

compliance with the minimum bid price requirements and that the Company was therefore in compliance with Nasdaq’s listing requirements.

Consequently, the scheduled hearing before the Panel was cancelled.

On July 1, 2025,

the Company received a determination from the Staff stating that the bid price of the common stock had closed below the $1.00 minimum

required by Nasdaq Listing Rule 5550(a)(2) for the prior 30 consecutive business days (the “Minimum Bid Price Requirement”)

and the Staff had determined to delist its securities from the Nasdaq Capital Market (the “July 2025 Staff Determination”).

The Company timely requested and was granted an appeal hearing before the Panel to appeal the July 2025 Staff Determination, which had

the effect of staying the delisting of the common stock pending the Panel’s decision.

As of August 12, 2025, the common stock had

closed above $1.00 for more than ten consecutive trading days.

As a result, on August 13, 2025, the Company received a letter from the

Staff advising that it had regained compliance with the Minimum Bid Price Requirement, and that it was therefore in compliance with Nasdaq’s

listing requirements.

Consequently, the appeal hearing before the Panel was cancelled.

On August 20, 2025,

the Company received a notification letter (the “August 2025 Staff Notice”) from the Staff notifying it that the stockholders’

equity balance reported in the Quarterly Report for the three months ended June 30, 2025 was below the $2.5 million required minimum

for continued listing on the Nasdaq Capital Market as set forth in Nasdaq Listing Rule 5550(b)(1).

Following the Warrant Adjustments

and resulting warrant exercises, and the elimination of the Cash True-up Payment liability, the Company’s stockholders’ equity

balance increased above the required threshold.

On September 17, 2025, the Company received a letter from the Staff confirming it had

regained compliance with Nasdaq’s listing requirements.

See “ Note 14,

Subsequent Events ” for additional information.

Stockholders’ Equity

The Company is authorized to issue an aggregate of

220,000,000 shares of capital stock, par value $ 0.001 per share, consisting of 200,000,000 shares of common stock and 20,000,000 shares

of preferred stock.

As of December 31, 2024 and December 31, 2023, 2,096,082 and 69,230 shares, respectively, of common stock were issued

and outstanding.

No shares of preferred stock have been issued.

As of December 31, 2024, of the 50,000,000 Units sold

in the August 2024 Public Offering at $ 0.20 per unit (Pre-Reverse Stock Split), 500,000 shares of common stock (post-Reverse Stock Split)

were issued, as all 16,598,000 Pre-Funded Warrants have been exercised.

Prior to the Company’s payoff of the 3i Note

in connection with the closing of the August 2024 Public Offering, the Company had issued 414 shares of common stock for the payment of

$ 90,839 in interest.

As of December 31, 2024, the Company has sold 4,336 shares of common stock for an aggregate amount of $ 828,491 , of

which $ 434,958 was used to repay a portion of the balance under the 3i Note, consisting of $ 380,042 to the loan principal, $ 34,204 to

interest and $ 20,712 as a redemption premium.

On May 2, 2024, at the closing price of $ 209.00 per

share, the Company agreed to issue 1,000 shares of common stock valued at $ 209,000 as well as $ 100,000 in cash as part of a settlement

agreement for a total value of $ 309,000 .

On March 31, 2023, at the closing price of $ 484.00

per share, the Company issued 520 shares of common as part of a settlement agreement for a total value of $ 251,680 .

On January 16, 2023, at the closing price of $ 454

per share, the Company issued 79 shares of common stock for stock-based compensation that had been accrued in 2023, for a total value

of $ 36,029 .

As of December 31, 2024 and December 31, 2023, 2,096,082

and 69,230 shares, respectively, of common stock were issued and outstanding.

The Company is authorized

to issue an aggregate of 220,000,000 shares

of capital stock, par value $ 0.001

per share, consisting of 200,000,000

shares of common stock and 20,000,000

shares of preferred stock.

As of December 31, 2025 and 2024,

9,781,739 and

2,096,082 shares,

respectively, of common stock were issued and outstanding.

No shares of preferred stock have been issued.

A holder of common stock is entitled to one vote for

each share of common stock.

The holders of common stock have no conversion, redemption or preemptive rights and shall be entitled to receive

dividends when, as, and if declared by the board of directors.

Upon dissolution, liquidation, or winding up of the Company, after payment

or provision for payment of debts and other liabilities of the Company, subject to the rights, if any, of the holders of any class or

series stock having a preference over the right to participate with common stock with respect to the distribution of assets of the Company

upon such dissolution, liquidation, or winding up of the Company, the holders of common stock shall be entitled to receive the remaining

assets of the Company available for distribution to its stockholders ratably in proportion to the number of shares of common stock held.

Since no shares of preferred stock have been issued,

no rights and privileges of preferred stockholders have been defined.

Initial Public Offering

On April 1, 2022, the Company completed an initial

public offering (“IPO”).

A total of 24,668 shares of common stock were sold at $ 700.00 per share in the IPO, for total gross

proceeds of $ 17,267,250 .

Warrants/Options

During the year ended December 31, 2023, 73,000 warrants

exercisable for 730 shares at $ 290.00 per share were exercised using the cashless conversion option which resulted in the issuance of

311 shares of common stock (post-Reverse Stock Split).

This left 78,000 warrants remaining, which expired on November 9, 2024 , without

being exercised, and there are no warrants remaining at $ 290.00 per share as of December 31, 2024.

During the year ended December 31, 2023, 22,606 warrants

exercisable for 226 shares of common stock at $ 332.00 per share were exercised using the cashless conversion option, which resulted in

the issuance of 102 shares of common stock, and 15,000 warrants exercisable for 150 shares of common stock at $ 332.00 per share were exercised

on a cash basis, which resulted in the issuance of 150 shares of common stock.

During the year ended December 31, 2024, 7,535 warrants

exercisable for 75 shares of common stock at $ 332.00 per share were exercised using the cashless conversion option which resulted in the

issuance of 16 shares of common stock.

This leaves 514,290 warrants remaining convertible into 5,149 shares of common stock with an exercise

price of $ 332.00 per share as of December 31, 2024.

On August 10, 2023, the Company issued 25,000 warrants

to their investor relations firm in accordance with a letter of engagement signed July 22, 2022, to purchase 250 shares of common stock

at an exercise price of $500.00 per share.

The warrants expire two years from the date of grant on August 9, 2025.

The fair value of the

warrants was determined at date of issuance using the Black-Scholes option-pricing model and following assumptions:

per share price of

common stock on date of grant $ 5.20 , expected dividend yield of 0 %, expected volatility of 88 %, risk-free interest rate of 4.82 % and expected

life based on contractual life of two years.

The fair value of $ 65,045 was recorded as an increase in additional paid-in capital

and expensed to Legal and Professional Services.

As part of a settlement agreement on May 2, 2024,

the Company agreed to modify the exercise price of 88,803 warrants convertible into 891 shares from $ 910.00 to $ 450.00 .

Stockholders are

entitled to one vote for each share of common stock.

The holders of common stock have no conversion, redemption or preemptive rights

and shall be entitled to receive dividends when, as, and if declared by the board of directors.

Upon dissolution, liquidation, or winding

up of the Company, after payment or provision for payment of debts and other liabilities of the Company, subject to the rights, if any,

of the holders of any class or series of capital stock having a preference over the common stock with respect to the distribution of

assets of the Company upon such dissolution, liquidation, or winding up of the Company, the holders of common stock shall be entitled

to receive the remaining assets of the Company available for distribution to its stockholders ratably in proportion to the number of

shares of common stock held.

Since no shares of preferred stock have been issued, no rights and privileges of preferred stockholders

have been defined.

In November 2025,

the Company issued 125,000

unregistered shares of common stock to a vendor in exchange

for services rendered, and recorded a $ 141,250

expense in legal and professional fees.

In October 2025,

the Company issued 400,000

RSUs pursuant to the 2021 Plan (as defined below) that were

immediately vested upon issuance and settled for 400,000

shares of common stock, and recorded $ 600,000

of stock-based compensation expenses.

In addition, the Company

issued an aggregate of 613,077 shares of common stock pursuant to the October 2025 Private Placement.

In September 2025,

the Company issued 200,000

unregistered shares of common stock to a vendor in exchange

for services rendered, and recorded $ 242,000

of legal and professional fee expenses.

In August 2025, 4,384,749

shares of common stock were issued upon exercise of Series

A Warrants, and 599,193

shares of common stock were issued upon exercise of January

2025 Warrants.

In July 2025, 85,252

shares of common stock were issued upon exercise of Series

In April 2025, the

Company issued 105,000

RSUs pursuant to the 2021 Plan that were immediately vested

and settled for 105,000

shares of common stock, and 125,000

shares were granted to a vendor in exchange for services rendered,

and expenses of $ 80,850

in stock-based compensation and $ 106,250

in legal and professional fees were recorded

for these two transactions, respectively.

In January 2025,

the Company issued an aggregate of 1,048,386

shares of common stock pursuant to the January 2025 Public

See “ Note 7,

Equity and Debt Financings ” for additional information.

In the January 2025

Public Offering, the Company issued pre-funded warrants, which were immediately exercised for 574,193

shares of common stock at $ 2.48

per share, and 1,048,386

January 2025 Warrants at an exercise price of $ 2.36

In August 2025, as part of the Warrant Inducement,

the Company issued 599,193 shares of common stock upon exercise of the January 2025 Warrants for a price of $1.31 per share.

As of December

31, 2025, 449,193 of the January 2025 Warrants remain outstanding.

In 2024, 8,125,000

Series B Warrants exercisable for 496,232

shares at $ 0.10 per share were exercised using the cashless conversion option which resulted in the issuance of 215,678 shares of common

stock (based on a $ 5.206 reset price).

Another 46,300,000 Series B Warrants were exercised on a cash basis which resulted in the issuance

of 1,078,689 shares of common stock (based on a $ 5.206 reset price).

This leaves 3,075,000 Series B warrants remaining, which are exercisable

for 87,384 shares (post-Adjustment), as of December 31, 2024.

In addition, 323,203 Series A Warrants were exercised on a cash basis which

resulted in the issuance of 14,900 of common stock.

This leaves 114,676,797 Series A Warrants remaining, which are exercisable for 5,286,692

shares of common stock, as of December 31, 2024.

As of December 31, 2024 and December 31, 2023, a total

of 687,295 and 772,830 regular warrants to purchase 6,889 and 7,745 shares of common stock, respectively, were issued and outstanding.

As of December 31, 2023, a total of 30,000 options, which were not issued under a specified plan, were outstanding.

However, all 30,000

non-plan options expired on November 8, 2024 , and there are no non-plan options outstanding as of December 31, 2024.

Below is a summary of warrants and stock options issued

and outstanding as of December 31, 2024:

Schedule of various warrants/options issued and outstanding

Number of Warrants

Issuable Shares

Exercise Price per share

Weighted Average Remaining Life (Years)

3,075,000 (1)

114,676,797 (2)

Series B Warrants are subject to reset pricing to determine the number of shares issuable.

Series A Warrants are subject to reset pricing to determine the number of shares issuable.

Series B warrants do not have an expiration date.

As of December 31, 2024, the Company had adopted two

stock-based compensation plans, the 2021 Incentive Award Plan and the 2021 Employee Stock Purchase Plan.

During the year ended December 31, 2024, the Company

granted 161 RSUs, granted 1,045 options, and canceled 100 options (post-Reverse Stock Split) under the 2021 Incentive Award Plan.

compensation costs that have been charged against operations were $ 581,504 and $ 495,320 for the years ended December 31, 2024 and 2023.

No shares have been issued to date under the 2021

Employee Stock Purchase Plan.

2021 Incentive Award Plan

The purpose of the Company’s 2021 Incentive

Award Plan is to enhance the Company’s ability to attract, retain and motivate persons who make (or are expected to make) important

shares at $ 0.10

per share were exercised using the cashless conversion option

which resulted in the issuance of 215,678

shares of common stock (based on a $ 5.206

reset price).

Another 46,300,000

Series B Warrants were exercised on a cash basis which resulted

in the issuance of 1,078,689

shares of common stock (based on a $ 5.206

reset price).

In July 2025, 3,000,000

warrants were exercised on a cash basis, which resulted in

the issuance of 85,252

In 2024, 323,203

Series A Warrants were exercised on a cash basis which resulted

in the issuance of 14,900

of common stock.

In August 2025, as part of the Warrant Inducement,

the exercise price of the Series A Warrants was reduced to $ 1.31

per share, and 4,384,749

shares were issued upon exercise of 95,112,212

As of December 31, 2025, there were 19,564,585

Series A Warrants exercisable for 901,943

shares and 75,000

Series B Warrants exercisable for 2,132

shares outstanding.

In 2023, the Company

issued 25,000

warrants to purchase 250

shares of common stock, at an exercise price of $ 500.00

per share, to its investor relations firm in accordance with

an engagement letter.

warrants expired August 9, 2025 without being exercised.

In 2022, the Company

issued 148,005

warrants to purchase 1,490

shares of common stock, at an exercise price of $ 910.00

per share, with an expiration date of March

As part of a settlement agreement on

May 2, 2024, the Company agreed to modify the exercise price of 88,803

warrants convertible into 891

shares from $ 910.00

to $ 450.00 .

As of December 31, 2025, all warrants with an exercise price of $ 910.00

remain outstanding.

In 2021, the Company

issued 559,431

warrants to purchase 5,602

shares of common stock at an exercise price of

per share, with an expiration date of November

Warrants were exercised during 2023

and 2024, and as of December 31, 2025, there were 514,290

warrants exercisable for 5,149

shares outstanding.

Below is a summary

of warrants issued and outstanding as of December 31, 2025:

of various warrants/options issued and outstanding

Price per Share

Average Remaining Life (Years)

Series B Warrants, which are subject to reset pricing to determine the number of shares issuable.

Series B Warrants do not

have an expiration date.

January 2025 Warrants, which were part of the Warrant Inducement, and their exercise price was reduced from $2.36 to $1.31 per share.

Series A Warrants, which are subject to reset pricing to determine the number of shares issuable.

Series A Warrants were part of the Warrant Inducement, and their exercise price was reduced from $5.206 to $1.31 per share.

Warrant Inducement

and Repricing

August 14, 2025, the Company entered into an inducement offer letter agreements with certain holders of the Series A Warrants and the

January 2025 Warrants, which reduced the exercise price of the Series A Warrants from $ 5.206

to $1.31 per share, and the January 2025 Warrants from 2.36

to $1.31 per share.

The difference between the fair value of

the warrants immediately prior to and following modification was treated as a transaction cost, which is netted against proceeds received.

The difference in fair value for the Series A Warrants was $1,423,166 ,

and the difference in fair value for the January 2025 Warrants was $97,746.

Both were calculated using the Black-Scholes option-pricing

model and were based on the following assumptions:

August 2025, 4,384,749

shares were issued upon exercise of Series A Warrants, and

shares were issued upon exercise of January 2025 Warrants,

and the difference in fair value was netted against the gross proceeds along with other issuance costs.

As of December 31,

2024, the Company had adopted two stock-based compensation plans, the 2021 Incentive Award Plan (the “2021 Plan”) and the

2021 Employee Stock Purchase Plan (the “2021 ESPP”).

2021 Incentive Award

The purpose of the

2021 Plan is to enhance the Company’s ability to attract, retain and motivate persons who make (or are expected to make) important

contributions to the Company by providing these individuals with equity ownership opportunities.

Various stock-based awards may be granted

under the 2021 Incentive Award Plan to eligible employees, consultants, and non-employee directors.

The number of shares issued under

the 2021 Incentive Award Plan is subject to limits and is adjusted annually.

No more than 1,000,000 shares may be issued pursuant to the

exercise of incentive stock options.

The aggregate share limit will be subject to an annual increase on the first day of each calendar

year ending on and including January 1, 2031, by a number of shares equal to the lesser of (i) a number equal to 5% of the aggregate number

of shares of the Company's common stock outstanding on the final day of the immediately preceding calendar year and (ii) such smaller

number of shares as is determined by the Company's board or committee.

As of December 31, 2024, the aggregate number of shares that can

be issued under the 2021 Incentive Award Plan is 17,958 , of which 11,430 options and 649 RSUs have been granted.

The number of shares granted, the exercise price, and the terms

will be determined at date of grant;

however, the exercise price shall not be less than 100% of the fair value on the grant date (110%

for options granted to greater than 10% stockholders, except for options granted to Mr.

Yozamp in August 2023, which were at 100%) and

the term shall not exceed ten years.

2021 Employee Stock Purchase Plan

The purpose of the Company’s 2021 Employee Stock

Purchase Plan is to assist eligible employees of the Company in acquiring a stock ownership in the Company and to help such employees

provide for their future security and to encourage them to remain in the employment of the Company.

The 2021 Employee Stock Purchase Plan

consists of a Section 423 Component and Non-Section 423 Component.

The Section 423 Component is intended to qualify as an employee stock

purchase plan and also authorizes the grant of options.

Options granted under the Non-Section 423 Component shall be granted pursuant

to separate offerings containing sub-plans.

The Company may make one or more offerings under the 2021 Employee Stock Purchase Plan.

duration and timing of each offering period may be established or changed by the board, but in no event may an offering period exceed

27 months and in no event may the purchase period for the option exceed the duration of the offering period under which it is established.

On each exercise date for an offering period, each participant shall automatically be deemed to have exercised the option to purchase

the largest number of whole shares which can be purchased under the offering.

Option awards are generally granted with an exercise price

equal to 85% of the lesser of the fair market value of a share on (a) the applicable grant date and (b) the applicable exercise date,

or such other price as designated by the administrator, provided that in no event shall the option price be less that the per share par

The maximum number of shares granted under the 2021 Employee Stock Purchase Plan shall not exceed 25,000 shares.

The fair value of each option is estimated on the

date of grant using the Black-Scholes option pricing model.

The option-pricing model requires a number of assumptions, of which the most

significant are the expected stock price volatility and the expected option term.

Expected volatility was calculated based upon similar

traded companies’ historical share price movements as adequate historical experience is not available to provide a reasonable estimate.

Expected term is calculated based on the simplified method as adequate historical experience is not available to provide a reasonable

The simplified method will continue to apply until enough historical experience is available to provide a reasonable estimate

of the expected term.

The risk-free interest rate is calculated based on the yield from U.S.

Treasury zero-coupon bonds with an equivalent

The Company has historically not paid dividends and have no foreseeable plans to pay dividends.

The Company has computed the fair value of the 2,455

options granted during the year ended December 31, 2023 using the following assumptions:

Schedule of fair value of assumptions

under the 2021 Plan to eligible employees, consultants, and non-employee directors, including options and RSUs.

The number of shares

issued under the 2021 Plan is subject to an initial limit and is adjusted annually pursuant to an evergreen provision.

No more than 1,000,000

shares may be issued pursuant to the exercise of incentive stock options.

The aggregate share limit will be subject to an annual increase

on the first day of each calendar year ending on and including January 1, 2031, by a number of shares equal to the lesser of (i) a number

equal to 5% of the aggregate number of shares of the Company's common stock outstanding on the final day of the immediately preceding

calendar year and (ii) such smaller number of shares as is determined by the Company's board or committee.

The type of award,

number of shares subject to the award, exercise price (if any), vesting provisions (if any), and other terms of the awards will be determined

at date of grant;

however, the exercise price of options shall not be less than 100% of the fair value on the grant date and the term

of options shall not exceed ten years.

As of December 31, 2025, awards covering an aggregate of 872,762

shares were eligible to be issued under the 2021 Plan, of which

shares underlying options and 560,649

shares underlying RSUs had been granted.

On January 1, 2026,

an aggregate of 489,086 shares were added to the plan reserve pursuant to the evergreen provision based on the number of shares outstanding

as of December 31, 2025.

During the year ended

December 31, 2025, the Company granted RSUs covering an aggregate of 560,000 shares and options covering an aggregate of 203,278 shares,

and canceled options covering an aggregate of 104 shares under the 2021 Plan.

The stock-based compensation expenses incurred during the

years ended December 31, 2025 and 2024 were $ 1,163,654

and $ 581,504 ,

respectively.

2021 Employee Stock

Purchase Plan

The purpose of the

2021 ESPP is to assist eligible employees of the Company in acquiring stock ownership in the Company and to help such employees provide

for their future security and to encourage them to remain in the employment of the Company.

The 2021 ESPP consists of a Section 423 Component

and Non-Section 423 Component.

The Section 423 Component is intended to qualify as an employee stock purchase plan and also authorizes

the grant of options.

Options granted under the Non-Section 423 Component shall be granted pursuant to separate offerings containing

The Company may make one or more offerings under the 2021 ESPP.

The duration and timing of each offering period may be established

or changed by the board, but in no event may an offering period exceed 27 months and in no event may the purchase period for the option

exceed the duration of the offering period under which it is established.

On each exercise date for an offering period, each participant

shall automatically be deemed to have exercised the option to purchase the largest number of whole shares which can be purchased under

the offering.

Option awards are generally granted with an exercise price equal to 85% of the lesser of the fair market value of a share

on (a) the applicable grant date and (b) the applicable exercise date, or such other price as designated by the administrator.

number of shares granted under the 2021 ESPP shall not exceed 25,000

As of December 31,

2025, an aggregate of 524,051

shares were eligible to be issued under the 2021

On January 1, 2026, an aggregate of 97,817 shares were added to the plan reserve pursuant to the evergreen provision based on the

number of shares outstanding as of December 31, 2025.

No shares have been

issued under the 2021 ESPP.

The Company has computed

the fair value of options granted during the year ended December 31, 2025 using the following assumptions:

of fair value of assumptions

Expected volatility

2 unchanged sentences

Risk free rate

The Company has computed the fair value of the 1,045

options granted during the year ended December 31, 2023 using the following assumptions:

The Company has computed

the fair value of options granted during the year ended December 31, 2024 using the following assumptions:

Expected volatility

2 unchanged sentences

Risk free rate

The following table summarizes the Company’s

stock option activity under the 2021 Incentive Award Plan:

Schedule of stock option activity

(in thousands except number of options and per options data)

Number of options

Weighted average exercise price

Weighted average remaining contractual term (in years)

Aggregate intrinsic value

Outstanding at beginning of period

Outstanding at end of period

Exercisable at end of period

During the years ended December 31, 2024 and 2023,

the weighted-average grant-date fair value of the options granted to employees and non-employees was $ 312,873 and $ 998,915 , respectively.

Unrecognized compensation expense related to employees and non-employees was $ 101,970 as of December 31, 2024.

The options granted in

May 2022 were vested 100% at time of grant.

The options granted in August 2023 began to vest in equal quarterly installments beginning

September 30, 2023 and ending June 30, 2026.

The options granted in March 2024 were vested 50% at the time of grant, then the remainder

continues to vest in 12 equal quarterly installments thereafter, beginning June 30, 2024.

The following table summarizes the Company’s

RSU activity under the 2021 Incentive Award Plan:

Schedule of RSU activity

(in thousands except number of options and per options data)

Number of restricted stock awards

Weighted average grant-date fair value

Nonvested at beginning of year

Nonvested at end of year

There was no unrecognized compensation cost related

to non-vested RSUs as of December 31, 2024.

Common Stock Reserved for Future Issuance

The following is a summary of common stock shares

reserved for future issuance as of December 31, 2024:

Schedule of common stock shares reserved for future issuance

Exercise of warrants

Exercise of stock options – 2021 Incentive Award Plan

Exercise of restricted stock units – 2021 Incentive Award Plan

Exercise of Series A warrants

Exercise of Series B warrants

Total shares of common stock reserved for future issuances

The Company uses

the “simplified method” to estimate expected term.

Under the simplified method, an option’s expected term is calculated

as the time until expiration.

The following table

summarizes the option activity under the 2021 Plan during the year ended December 31, 2025:

of stock option activity

average exercise price

average remaining contractual term (in years)

intrinsic value

Outstanding at December 31, 2024

Outstanding at December 31, 2025

Exercisable at December 31, 2025

During the years

ended December 31, 2025 and 2024, the weighted-average grant-date fair value of the options granted to employees and non-employees was

and $ 312,873 ,

respectively.

The options granted

in July 2025 were vested as to 100% of the underlying shares at the time of grant.

The options granted in March 2024 vested as to 50%

of the underlying shares at the time of grant and the remaining shares are

subject to vesting

in 12 equal consecutive quarterly installments commencing September 30, 2024 such that the option will become fully vested on March 31,

The following table

summarizes the RSU activity under the 2021 Plan during the year ended December 31, 2025:

average grant-date fair value

Nonvested at December 31, 2024

Nonvested at December

There was no unrecognized

compensation cost related to non-vested RSUs as of December 31, 2025.

Common Stock Reserved

for Future Issuance

The following is

a summary of shares of common stock reserved for future issuance as of December 31, 2025:

of Stock Options – 2021 Plan

of Series A Warrants

of Series B Warrants

of January 2025 Warrants

of Pre-Funded Warrants

shares of common stock reserved for future issuances

Segment Reporting

The Company focuses on the design, assembly, manufacturing,

and sale of lithium iron phosphate (“LiFePO4”) batteries and supporting accessories for recreational vehicles (“RVs”),

marine applications and home energy storage products with plans to expand into industrial applications.

We sell to wholesalers, distributors,

and OEMs, as well as directly to consumers, and cannot always determine which application our batteries are ultimately used in.

The accounting policies for this segment aligns with

those outlined in the summary of significant accounting policies.

The Chief Executive Officer is the Chief Operating Decision Maker (CODM)

and assesses the performance of this segment and allocates resources based on net income or loss, which is reflected on the Statements

of Operations, and the measure of segment assets is represented as total assets on the Balance Sheet, included in the Financial Statements

section of this Annual Report.

The CODM evaluates the net income or loss from our

The Company focuses

on the design, assembly, manufacturing, and sale of LiFePO4 batteries and supporting accessories for RVs, marine, and industrial applications.

The Company sells to wholesalers, distributors, and OEMs, as well as directly to consumers.

The Company has identified

one reportable segment:

Net income or loss is also utilized to monitor the difference between budgeted and actual results, offering insights

into financial performance and guiding any necessary corrective actions.

Additionally, the CODM employs net income or loss for competitive

analysis by comparing its financial performance with other competitors in the Energy Storage (ES) space.

The Company does not engage in any intra-entity sales

or transfers.

The Company has identified one reportable segment:

Energy Storage (ES).

This segment generates revenue in North America, and the Company manages its product sales and associated expenses

on a total basis.

Our losses before income taxes for the years ended

December 31, 2024 and 2023 were generated primarily from U.S.

We have no current or deferred provision for income

taxes from continuing operations for the years ended December 31, 2024 and 2023.

The significant differences between the U.S.

statutory rate and our effective rate for financial reporting purposes are as follows:

of income before income tax, domestic and foreign

Years Ended December 31,

This segment generates revenue in North America, and the Company manages its product sales

and associated expenses on a total basis.

The accounting policies

for this segment align with those outlined in the summary of significant accounting policies.

The Chief Operating Decision Maker (CODM)

is the Chief Executive Officer.

The CODM assesses the performance of this segment and allocates resources based on net income or loss,

which is reflected on the Statements of Operations.

The measure of segment assets is total assets, which is reflected on the Balance

The CODM evaluates

the net income or loss from our one reportable segment.

Net income or loss is also utilized to monitor the difference between budgeted

and actual results.

Additionally, the CODM employs net income or loss for competitive analysis by comparing its financial performance

with other competitors in the Energy Storage (ES) space.

Our losses before

income taxes for the years ended December 31, 2025 and 2024 were generated primarily from U.S.

We have no current

or deferred provision for income taxes from continuing operations for the years ended December 31, 2025 and 2024.

The significant differences

between the U.S.

Federal statutory rate and our effective rate for financial reporting purposes are as follows:

Schedule of significant differences

between the U.S.

Federal statutory rate and our effective rate

Ended December 31,

Federal statutory tax rate

3 unchanged sentences

EQ Comp – Other

Permanent difference

True-up Adjustment

Effective tax rate

Deferred income taxes reflect the net tax effects

of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used

for income tax purposes.

Significant components of the Company’s deferred tax assets and liabilities are as follows for the year

ended December 31, 2024 and 2023.

Deferred income tax assets and liabilities consist

of the following:

of components of income tax expense

As of December 31,

Deferred tax assets:

Net Operating Losses

Stock-based compensation

Valuation allowance

Deferred income taxes

reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes

and the amounts used for income tax purposes.

Significant components of the Company’s deferred tax assets and liabilities are as

follows for the year ended December 31, 2025 and 2024.

Deferred income tax

assets and liabilities consist of the following:

of December 31,

Operating Losses

( 8,796,769 )

( 6,839,096 )

Deferred tax liabilities:

Net deferred tax asset

For financial reporting purposes, the Company incurred

losses for the year ended December 31, 2024 and December 31, 2023 and for each period since inception.

Accordingly, no benefit for income

taxes has been recorded due to the uncertainty of the realization of any tax assets.

At December 31, 2024, the Company had approximately

tax liabilities:

deferred tax asset

For financial reporting

purposes, the Company incurred losses for the years ended December 31, 2025 and 2024 and for each period since inception.

for income taxes has been recorded due to the uncertainty of the realization of any tax assets.

At December 31, 2025, the Company had

approximately $ 30,945,899

of federal and state net operating losses.

Accrued income taxes as of the end of each year as

of accrued income taxes

As of December 31,

Accrued income taxes

as of the end of each year as follows:

of December 31,

State Franchise Fees

A reconciliation between the amount of income tax

benefit determined by applying the U.S statutory income tax rate to pre-tax loss is as follows:

of operating loss carryforward

A reconciliation

between the amount of income tax benefit determined by applying the U.S statutory income tax rate to pre-tax loss is as follows:

Schedule of reconciliation

As of December 31,

3 unchanged sentences

Stock-based compensation

Penalties and Fines

Valuation allowance

Net deferred tax asset

Tax positions are evaluated in a two-step process.

The Company first determines whether it is more likely than not that a tax position will be sustained upon examination.

If a tax position

meets the more-likely-than-not recognition threshold it is then measured to determine the amount of benefit to recognize in the financial

The tax position is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate

The aggregate changes in the balance of gross unrecognized tax benefits, which excludes penalties and interest, for the year

ended December 31, 2024 is zero.

The Company is subject to taxation in the United States

Permanent difference

Change in valuation allowance

Effective tax

Tax positions are

evaluated in a two-step process.

The Company first determines whether it is more likely than not that a tax position will be sustained

upon examination.

If a tax position meets the more-likely-than-not recognition threshold it is then measured to determine the amount

of benefit to recognize in the financial statements.

The tax position is measured as the largest amount of benefit that is greater than

50% likely of being realized upon ultimate settlement.

The aggregate changes in the balance of gross unrecognized tax benefits, which

excludes penalties and interest, for the year ended December 31, 2025 is zero.

The Company is subject

to taxation in the United States and Oregon.

There are no ongoing examinations by taxing authorities at this time.

The Company’s various tax years 2018 through 2024

remain open for examination by various taxing jurisdictions.

The Company recognizes interest and penalties related

to uncertain tax positions in income tax expense.

As of December 31, 2024, the Company has not accrued any penalties or interest related

to uncertain tax positions.

In anticipation of an initial public offering, the

Company converted from a limited liability company to a C corporation, a taxable entity, effective November 1, 2021.

For the year ended December 31, 2023, the Company

accrued $ 1,840 for state minimum income taxes, and did not accrue federal income taxes due to net losses in 2023.

For the year ended December

31, 2024 the Company adjusted the accrual to $ 150 for state income taxes, as we do not anticipate owing more than the minimum state income

taxes for 2024.

Since converting to a C corporation, the Company has

incurred losses and consequently recorded no provision for state or federal income taxes for the years ended December 31, 2024 and 2023.

The Company maintains a full valuation allowance on all deferred tax assets, as it has concluded that it is more likely than not that

these assets will not be realized.

As of December 31, 2024 and December 31, 2023, there were no material unrecognized tax benefits included

in the accompanying balance sheets that would, if recognized, affect the effective tax rate.

The Company adopted a 401(k) Plan (“Plan”)

for the benefit of its employees.

Employees may contribute to the Plan within defined limits as defined by the Internal Revenue Service.

Substantially all employees are eligible to participate.

The Company has the option to make profit sharing contributions at its discretion.

The Company’s

various tax years 2019 through 2025 remain open for examination by various taxing jurisdictions.

The Company recognizes

interest and penalties related to uncertain tax positions in income tax expense.

As of December 31, 2025, the Company has not accrued

any penalties or interest related to uncertain tax positions.

In anticipation of

an initial public offering, the Company converted from a limited liability company to a C corporation, a taxable entity, effective November

For the years ended

December 31, 2025 and 2024, the Company accrued $ 150

for state minimum income taxes each year, and did not accrue

federal income taxes due to net losses in both years.

Since converting

to a C corporation, the Company has incurred losses and consequently recorded no provision for state or federal income taxes for the

years ended December 31, 2025 and 2024.

The Company maintains a full valuation allowance on all deferred tax assets, as it has concluded

that it is more likely than not that these assets will not be realized.

As of December 31, 2025 and 2024, there were no material unrecognized

tax benefits included in the accompanying balance sheets that would, if recognized, affect the effective tax rate.

The Company adopted

a 401(k) Plan (“Plan”) for the benefit of its employees.

Employees may contribute to the Plan within defined limits as defined

by the Internal Revenue Service.

Substantially all employees are eligible to participate in the Plan.

The Company has the option to make

profit-sharing contributions at its discretion.

No profit-sharing contributions have been made.

Related-Party Transactions

As of December 31, 2023, related party transactions

consisted of the Notes (see Note 6, Stockholder Promissory Notes ).

As of December 31, 2024, there were no outstanding

related-party transactions, as all Stockholder Promissory Notes had been repaid.

As of December 31,

2025 and 2024, there were no related-party transactions requiring disclosure under SEC rules and no such transactions were contemplated.

Subsequent Events

January 2025 Registered Direct Offering and Warrant

Private Placement

On January 3, 2025, the Company

sold to certain institutional investors, in a registered direct offering, an aggregate of (i) 474,193 shares of common stock;

574,193 pre-funded warrants (the “January 2025 Pre-Funded Warrants”) to purchase up to 574,193 shares of common stock (the

“January 2025 Pre-Funded Warrant Shares”).

The offering price per share was $2.48 and the offering price per January 2025

Pre-Funded Warrant was $2.479.

Each January 2025 Pre-Funded Warrant was exercisable for one share of common stock for $0.001 immediately

upon issuance and the January 2025 Pre-Funded Warrants were all exercised immediately upon issuance.

The number of January 2025 Pre-Funded

Warrant Shares are subject to adjustments for stock splits, recapitalizations, and reorganizations.

The January 2025 Pre-Funded Warrants

were exercised in full on January 3, 2025.

In a concurrent private placement

that closed January 3, 2025, the Company also issued to the institutional investors unregistered warrants (the “January 2025 Warrants”)

to purchase up to an aggregate of 1,048,386 shares of common stock (the “January 2025 Warrant Shares”) at an exercise price

of $ 2.36 per share, subject to adjustment for reverse stock splits, recapitalizations, and reorganizations.

In connection with the private

placement, the Company filed a registration statement on Form S-1 (File No.

333-284354), which was declared effective by the SEC on February

11, 2025, covering the resale of the January 2025 Warrant Shares.

The Company received net proceeds of approximately

$ 2.2 million from the offering and used approximately $ 500,000 of the net proceeds to satisfy a portion of

certain amounts owed to our Series A Warrant holders pursuant to the terms of the outstanding Series A Warrants.

The Company evaluated

its financial statements for the year ended December 31, 2025 for subsequent events through the date the financial statements were

available to be issued.

The following subsequent events are noted:

December 2025 At-The-Market

Issuance Sales Agreement

On December 12, 2025

the Company entered into an At-The-Market Issuance Sales Agreement.

We commenced sales under the agreement in January 2026 and have sold

an aggregate of 1,064,396

shares for net proceeds of approximately $ 932,567

as of March 11, 2026.

January 2026 Nasdaq

Staff Determination Letter

On January 29, 2026,

the Company received a determination from the Staff stating that it did not meet the Minimum Bid Price Requirement and that the Staff

had determined to delist its securities from the Nasdaq Capital Market subject to a compliance period.

Nasdaq provided the Company with

a 180-calendar day compliance period, or until July 28, 2026, to regain compliance with the listing rule.

The Company is currently evaluating

options to regain compliance and intends to timely regain compliance with the Minimum Bid Price Requirement.

Under Nasdaq rules, the

Company is currently eligible to conduct a reverse stock split of its common stock to regain compliance if necessary.

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