Zeo ScientifiX, Inc. 10-K

Item 8. Financial Statements and Supplementary Data. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS PAGE NO. Zeo ScientifiX, Inc. Report of Independent Registered Public Accounting Firms F-2 Consolidated Balance Sheets as of October 31, 2025 and 2024 F-3 Consolidated Statements of Operations for the Years Ended October 31, 2025 and 2024 F-4 Consolidated Statement of Changes In Stockholders’ Deficit for the Years Ended October 31, 2025 and 2024 F-5 Consolidated Statements of Cash flows for the Years Ended October 31, 2025 and 2024 F-6 Notes to Consolidated Financial Statements F-7 – F-34 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of Zeo Scientifix, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Zeo Scientifix, Inc. (the “Company”) as of October 31, 2025 and 2024, the related consolidated statements of operations, changes in stockholders’ deficit and cash flows for the years then ended, 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 October 31, 2025 and 2024, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 3, during the year ended October 31, 2025 the Company incurred significant losses and utilized cash in operations, and had a stockholders’ deficit as of that date. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. 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 A critical audit matter 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) relates to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex judgments. We determined that there were no critical audit matters. We have served as the Company’s auditor since 2023. /s/ Weinberg & Company P.A. Weinberg & Company P.A. 572 Los Angeles, CA January 29, 2026 F- 2 Zeo ScientifiX, Inc. CONSOLIDATED BALANCE SHEETS As of October 31, 2025 and 2024 (Amounts rounded to the nearest thousand except share amounts) October 31, 2025 October 31, 2024 ASSETS Current Assets Cash $ 221,000 $ 657,000 Accounts receivable, net of allowance for bad debts 35,000 194,000 Other receivables - 3,000 Prepaid expenses 279,000 79,000 Inventories 423,000 232,000 Total Current Assets 958,000 1,165,000 Property and equipment, net 569,000 478,000 TOTAL ASSETS $ 1,527,000 $ 1,643,000 LIABILITIES, SHARES SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT Current Liabilities Accounts payable and accrued expenses $ 1,980,000 $ 1,719,000 Finance lease obligations 33,000 5,000 Convertible promissory note, net of debt discount of $ 7,000 and $ 45,000 243,000 680,000 Obligation to repurchase shares 19,000 - Deferred revenue 598,000 884,000 Total Current Liabilities 2,873,000 3,288,000 Long term finance lease obligations 77,000 8,000 Total Liabilities 2,950,000 3,296,000 Commitments and contingencies Shares Subject To Possible Redemption Series C Preferred Stock, $ 0.001 par value, 100 shares authorized; 100 and 100 shares issued and outstanding, respectively - - Stockholders’ Deficit Common stock, $ 0.001 par value, 2,500,000,000 shares authorized; 6,747,441 and 6,344,817 shares issued and outstanding, respectively 7,000 6,000 Additional paid-in capital 66,304,000 60,554,000 Accumulated deficit ( 67,734,000 ) ( 62,213,000 ) Total Stockholders’ Deficit ( 1,423,000 ) ( 1,653,000 ) TOTAL LIABILITIES, SHARES SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT $ 1,527,000 $ 1,643,000 The accompanying notes are an integral part of these consolidated financial statements. F- 3 Zeo ScientifiX, Inc. CONSOLIDATED STATEMENTS OF OPERATIONS For the Years Ended October 31, 2025 and 2024 (Amounts rounded to the nearest thousand except share amounts) Year Ended October 31, 2025 2024 Revenues (includes sales to related parties of approximately $ 88,000 and $ 199,000 , respectively) $ 5,199,000 $ 4,620,000 Cost of revenues 931,000 844,000 Gross profit 4,268,000 3,776,000 General and administrative expenses 9,654,000 9,095,000 Loss from operations ( 5,386,000 ) ( 5,319,000 ) Other income (expense) Interest expense ( 98,000 ) ( 92,000 ) Change in obligation to repurchase shares ( 2,000 ) - Inducement expense to convert Notes in payable ( 136,000 ) - Impairment of non-marketable securities in a related entity - ( 45,000 ) Other income 101,000 751,000 Net loss $ ( 5,521,000 ) $ ( 4,705,000 ) Net loss per common share - basic and diluted $ ( 0.86 ) $ ( 0.74 ) Weighted average number of common shares outstanding - basic and diluted 6,409,953 6,336,392 The accompanying notes are an integral part of these consolidated financial statements. F- 4 Zeo ScientifiX, Inc. CONSOLIDATED CHANGES TO STOCKHOLDERS’ DEFICIT For the Years Ended October 31, 2025 and 2024 (Amounts rounded to the nearest thousand except share amounts) Common Stock Additional Paid In Accumulated Total Stockholders’ Shares Par Value Capital Deficit Deficit Balance October 31, 2023 7,283,483 $ 7,000 $ 56,260,000 $ ( 57,508,000 ) $ ( 1,241,000 ) Sale of common stock 250,000 - 500,000 - 500,000 Reverse split round-up adjustment 5,803 - - - - Cancellation of shares in connection with litigation ( 1,164,742 ) ( 1,000 ) 1,000 - - Purchase of shares in connection with litigation ( 237,602 ) - ( 80,000 ) - ( 80,000 ) Exchange of accounts payable for stock 20,000 - 20,000 - 20,000 Fair value of equity instruments issued for compensation: Fair value of vested shares issued 187,875 - 450,000 - 450,000 Fair value of vested options issued - - 953,000 - 953,000 Fair value of vested warrants issued - - 2,450,000 - 2,450,000 Net loss - - - ( 4,705,000 ) ( 4,705,000 ) Balance October 31, 2024 6,344,817 6,000 60,554,000 ( 62,213,000 ) ( 1,653,000 ) Sale of common stock 75,000 - 300,000 - 300,000 Inducement expense to convert Notes payable - - 136,000 - 136,000 Conversion of Notes payable 171,347 1,000 513,000 - 514,000 Acquisition of BioLumina 30,000 - 58,000 - 58,000 Exercise of warrants 21,277 - 50,000 - 50,000 Fair value of equity instruments issued for compensation: Fair value of vested shares issued 105,000 - 233,000 - 233,000 Fair value of vested options issued - - 1,523,000 - 1,523,000 Fair value of vested warrants issued - - 2,937,000 - 2,937,000 Net loss - - - ( 5,521,000 ) ( 5,521,000 ) Balance October 31, 2025 6,747,441 $ 7,000 $ 66,304,000 $ ( 67,734,000 ) $ ( 1,423,000 ) The accompanying notes are an integral part of these consolidated financial statements. F- 5 Zeo ScientifiX, Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended October 31, 2025 and 2024 (Amounts rounded to the nearest thousand except share amounts) Year Ended October 31, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ ( 5,521,000 ) $ ( 4,705,000 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization expense 73,000 74,000 Amortization of debt discount – Promissory notes 39,000 23,000 Bad debt expense - 9,000 Change in obligation to repurchase shares 2,000 - Inducement expense to convert Notes 136,000 - Write-off of advances payable to former officer - ( 221,000 ) Reserve of non-marketable securities – related party - 45,000 Stock-based compensation 4,693,000 3,853,000 Changes in operating assets and liabilities: Accounts receivable, net of allowance for bad debts 159,000 ( 185,000 ) Other receivable 3,000 9,000 Prepaid expenses ( 25,000 ) 27,000 Inventories ( 191,000 ) 78,000 Accounts payable and accrued expenses 200,000 ( 851,000 ) Security deposits - 7,000 Deferred revenue ( 286,000 ) 387,000 Net cash used in operating activities ( 718,000 ) ( 1,450,000 ) CASH FLOWS FROM INVESTING Purchase of fixed assets ( 23,000 ) - Investment in non-marketable equity securities – related party - ( 45,000 ) Net cash used in investing activities ( 23,000 ) ( 45,000 ) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from exercise of warrants 50,000 - Shares repurchased in connection with litigation - ( 80,000 ) Payments on finance leases ( 45,000 ) ( 24,000 ) Proceeds from sale of common stock 300,000 500,000 Net cash provided by financing activities 305,000 396,000 Decrease in cash ( 436,000 ) ( 1,099,000 ) Cash at beginning of period 657,000 1,756,000 Cash at end of period $ 221,000 $ 657,000 SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for taxes $ - $ - Cash paid for interest $ 20,000 $ 68,000 NON-CASH INVESTING AND FINANCING TRANSACTIONS: Reduction in accounts payable for equipment returned to vendor $ - $ 21,000 Exchange of shares for payables $ - $ 20,000 Finance lease obligations $ 140,000 $ - Stock issued – Purchase of BioLumina assets $ 58,000 $ - Conversion of notes payable and accrued interest for equity $ 514,000 $ - Royalty payable in connection with purchase of BioLumina assets $ 100,000 $ - Obligation to repurchase shares in connection with purchase of BioLumina assets $ 16,000 $ - The accompanying notes are an integral part of these consolidated financial statements. F- 6 Zeo ScientifiX, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS Zeo ScientifiX, Inc. (“ZEO” or the “Company”) was incorporated on August 9, 2011 in the State of Nevada under the name Bespoke Tricycles Inc. (changed to Biotech Products Services and Research, Inc. during September 2015 and to Organicell Regenerative Medicine, Inc., effective June 20, 2018). Effective February 20, 2024, we further amended our Articles of Incorporation to assume our current name, Zeo ScientifiX, Inc. The Company is a clinical-stage biopharmaceutical company principally focusing on the development of innovative biological therapeutics for the treatment of degenerative diseases and regenerative medicine. In connection with the state of Florida’s new “stem cell therapy” law, effective July 1, 2025 (“SB 1768”)., the Company has begun to pursue clinical research and commercial sales strategies that are compliant with SB 1768. The Company has a portfolio of proprietary products derived from ethically sourced birth tissue, including mesenchymal stem cells, stem cell and amniotic fluid derived exosomes and Whartons Jelly matrix. The Company’s principal product is Zofin™, a product derived from amniotic fluid and manufactured to retain the naturally occurring extracellular vesicles, proteins and cell secreted nanoparticles. ZEO also manufactures Patient Pure X™ (“PPX™”), a proprietary autologous biologic containing a nanoparticle fraction that is precipitated from a patient’s own peripheral blood. ZEO’s products are all manufactured in FDA-registered, cGMP-compliant laboratory facilities. Our portfolio of products (“RAAM Products”) and related services are principally used in the health care industry administered through doctors and clinics (“Providers”). In addition to the Company’s efforts to now supply products that are compliant with SB 1768, the Company has recently developed and begun to distribute additional products that incorporate its proprietary ingredients for products to be used in topical aesthetic applications and is actively exploring further development of additional products to be used in other topical aesthetic applications. Effective November 28, 2023, we implemented a one-for-200 reverse stock split (the “Reverse Split”). The par value of the Company’s common stock was unchanged at $0.001 per share after the Reverse Split. As a result, on the effective date of the Reverse Split, the stated capital on the Company’s balance sheet attributable to the Company’s common stock was reduced proportionately based on the Reverse Split ratio of one-for-200 and the additional paid-in capital account was credited with the amount by which the stated capital was reduced. All share and per share amounts referenced herein give effect to the Reverse Split as of the earliest period presented. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Concentrations of Risk Credit Risk The balance sheet items that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents and accounts receivable. Balances in accounts are insured up to Federal Deposit Insurance Corporation (“FDIC”) limits of $ 250,000 per institution. At October 31, 2025, the Company did no t have cash balances in one financial institution in excess of FDIC insurance coverage limits. F- 7 Major Customer During the year ended October 31, 2025, the Company sold products and services totaling approximately $ 741,000 ( 14.3 % ) to a large medical practice group, approximately $ 597,000 ( 11.5 % ) to a large distributor and medical practice group and approximately $ 568,000 ( 10.9 % ) to another large distributor and medical practice group. During the year ended October 31, 2024, the Company sold products and services totaling approximately $ 661,000 ( 14.3 % ) to a large distributor and medical practice group and approximately $ 556,000 ( 12.0 % ) to another large distributor and medical practice group. As of October 31, 2025, the Company had accounts receivable from one customer. As of October 31, 2024, the Company had accounts receivable from three customers which comprised 60 % , 17 % and 12 % of its gross accounts receivable, respectively. There were no other customers that accounted for more than 10 % of accounts receivable at October 31, 2025 or 2024. The Company’s sales agreements are non-exclusive and the Company does not believe it has any exposure based on the customers of its products. Major Supplier The Company has contracts with more than one supplier of the tissue raw material used in manufacturing of its products. During the fiscal year ended October 31, 2025, the Company purchased the tissue raw material used in manufacturing of its products from one supplier in the amount of $120,000 ( 72 % of total raw material purcahses and $ 45,000 ( 28 % of total raw material purchases. During the fiscal year ended October 31, 2024, the Company purchased the tissue raw material used in manufacturing of its products from one supplier in the amount of $ 135,000 . The Company’s supply agreements are non-exclusive and the Company does not believe it has any exposure based on the availability of raw materials and/or products from other suppliers. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles of the United States 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 revenues and expenses during the year. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates. Those estimates and assumptions include estimates for credit loss reserves for accounts receivable, assumptions used in valuing inventories at net realizable value, impairment testing of recorded long-term assets, the valuation allowance for deferred tax assets, accruals for potential liabilities, assumptions made in valuing equity instruments issued for services, and assumptions used in the determination of the Company’s liquidity. Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. F- 8 Accounts Receivable Accounts receivable are recorded at net realizable value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to pay their obligation. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. Most of the Company’s sales do not provide for installment payments and amounts are typically due upon invoicing. However, for those customers that are granted payment terms, the policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company are exhausted, the determination for charging off uncollectible receivables is made. Management determined that no allowance for bad debts was necessary at October 31, 2025 and 2024. For the years ended October 31, 2025 and 2024, the Company recorded bad debt expense of $ 0 and $ 9,000 , respectively. Inventory Inventory is stated at the lower of cost or net realizable value using the average cost method. The Company provides a reserve for potential excess, dated or obsolete inventories based on an analysis of forecasted demand compared to quantities on hand and any firm purchase orders, as well as product shelf life. At October 31, 2025 and 2024, the Company determined that no reserves were required in connection with our inventory. Property and Equipment Property and equipment are stated at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the related assets. The estimated useful lives of property and equipment range from 3 to 15 years. Upon sale or retirement, the cost and related accumulated depreciation and amortization are eliminated from their respective accounts, and the resulting gain or loss is included in results of operations. Repairs and maintenance charges, which do not increase the useful lives of the assets, are charged to operations as incurred. Non-marketable Securities Non-marketable securities consist of equity investments in privately held companies, which are classified as other assets on the consolidated balance sheets. These non-marketable equity securities do not have readily determinable fair values. Under the measurement alternative election, the Company accounts for these non-marketable securities at cost and adjusted for observable price changes in orderly transactions for the identical or similar investments of the same issuer or upon impairment and are not eligible for the net-asset-value practical expedient from fair value measurement. The measurement alternative election is reassessed each reporting period to determine whether the non-marketable securities continue to be eligible for this election. The Company periodically evaluates its non-marketable securities for impairment when events and circumstances indicate that the carrying amount of the investment may not be recovered. Impairment indicators may include, but are not limited to, a significant deterioration in earnings performance, credit rating, asset quality or business outlook or a significant adverse change in the regulatory, economic, or technological environment. Under current U.S. GAAP, equity investments without readily determinable fair values are reported at cost minus impairment. However, impairment losses are recognized only if they are considered other-than- temporary. The Company evaluated its investment in non-marketable securities at October 31, 2025 and 2024, and determined such investment was impaired. F- 9 Leasehold Improvements Leasehold improvements in excess of $1,000 that are made in connection with leases having a term of more than 12 months are capitalized by the Company and amortized over the shorter of the useful life of the asset or the remaining lease periods and renewals that are deemed to be reasonably certain at the date the leasehold improvements are purchased. Costs associated with leasehold improvements that do not exceed $1,000 are expensed as incurred. Revenue Recognition The Company follows the guidance of the Financial Accounting Standards Board (“FASB’) Accounting Standards Update (“ASU”) Topic 606 “Revenue from Contracts with Customers” which requires the Company to recognize revenue in amounts that reflect the prorata completion of the performance obligations of the Company required under the contracts. The Company recognizes revenue only when it transfers control of a promised good or service to a customer in an amount that reflects the consideration it expects to receive in exchange for the good or service. Our performance obligations are satisfied and control is transferred at a point-in-time, which is typically when the transfer and title to the product sold has taken place and there is evidence of our customer’s satisfactory acceptance of the product shipment or delivery except in those instances when the customer has made prior arrangements with the Company to store the product purchased by the customer at the Company’s facilities that is to be delivered at a later date to be designated by the customer. Amounts received prior to satisfying the revenue recognition criteria are recorded as deferred revenue on the Company’s consolidated balance sheet. Net Income (Loss) Per Common Share Basic income (loss) per common share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of fully vested common shares outstanding during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of fully vested shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted average number of shares adjusted for any potentially dilutive debt or equity instruments. At October 31, 2025, the Company had 4,265,444 common shares issuable upon the exercise of options and warrants (vested and unvested), 212,500 unissued restricted stock ( 178,333 unvested), $ 250,000 of convertible debt securities (convertible into a maximum of 41,667 shares) and $ 100,000 of future obligations in connection with the purchase of the BioLumina assets that may be settled through the issuance of common stock (convertible into a maximum of 40,000 shares) that were not included in the computation of dilutive loss per share because their inclusion is anti-dilutive for the year ended October 31, 2025. At October 31, 2024, the Company had 3,522,527 common shares issuable upon the exercise of options and warrants (vested and unvested), 185,000 unvested and unissued restricted stock and $ 725,000 of convertible debt securities (convertible into a maximum of 120,834 shares) that were not included in the computation of dilutive loss per share because their inclusion is anti-dilutive for the nine months ended October 31, 2024. Stock-Based Compensation All stock-based payments are recognized in the financial statements based on their fair values. The Company periodically issues stock options and stock awards to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on ASC 718, Compensation-Stock Compensation whereby the value of the award is measured on the date of grant and recognized for employees as compensation expense on the straight-line basis over the vesting period. Recognition of compensation expense for non-employees is in the same period and manner as if the Company had paid cash for the services. F- 10 The fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods. Research and Development Costs Research and development costs consist of direct and indirect costs associated with the development of the Company’s technologies. These costs are expensed as incurred. Our research and development expenses were approximately $ 100,000 and $ 164,000 for the years ended October 31, 2025 and 2024, respectively. The research and development costs primarily relate to the filing and approval of IND applications and the performance of clinical trials. Income Taxes The Company files a consolidated tax return that includes all of its subsidiaries. Provisions for income taxes are based on taxes payable or refundable for the current year taxable income for federal and state income tax reporting purposes and deferred income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss carryforwards. Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of the operations in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions in accordance with FASB Topic 740 – Income Taxes. This pronouncement prescribes a recognition threshold and measurement process for financial statement recognition of uncertain tax positions taken or expected to be taken in a tax return. The interpretation also provides guidance on recognition, derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition. For the years ended October 31, 2025 and 2024 the Company incurred operating losses, and therefore, there was not any income tax expense amount recorded during those periods. There is a full valuation allowance established for the tax benefit associated with the net losses for the years ended October 31, 2025 and 2024. Fair Value of Financial Instruments The Company includes fair value information in the notes to financial statements when the fair value of its financial instruments is different from the book value. When the book value approximates fair value, no additional disclosure is made. The Company follows FASB ASC 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value and enhances disclosures about fair value measurements. It defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company’s financial instruments consist of cash and cash equivalents, accounts payable, accrued liabilities and convertible debt. The estimated fair value of cash, accounts payable and accrued liabilities approximate their carrying amounts due to the short-term nature of these instruments. F- 11 The Company follows the provisions of ASC 820 with respect to its financial instruments. As required by ASC 820, assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to their fair value measurement. Level one — Quoted market prices in active markets for identical assets or liabilities; Level two — Inputs other than level one inputs that are either directly or indirectly observable such as quoted prices for similar assets or liabilities, quoted 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; and Level three — Unobservable inputs that are supported by little or no market activity and developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each quarter. The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable, accounts payable and other payables, approximate their fair values because of the short maturity of these instruments. The carrying values of convertible notes approximate their fair values because interest rates on these obligations are based on prevailing market interest rates. Operating Lease Obligations Under the provisions of Accounting Standards Update (ASU) No. 2016-02 (Topic 842) (“ASC 842”), the Company recognizes a right of use (“ROU”) asset and corresponding lease liability for all operating leases upon commencement of the lease. The Company’s policy is to treat operating leases that have a term of one year or less at lease commencement date and do not include a purchase option that is reasonably certain of exercise, consistent with the lease recognition approach as previously outlined under ASC 840. In addition, month to month leases which do not involve additional financial commitments on the part of the Company are also treated consistent with the lease recognition approach as previously outlined under ASC 840. The Company has established a capitalization threshold of $15,000 in determining whether any future operating leases will be capitalized. Subsequent Events The Company has evaluated subsequent events that occurred after October 31, 2025 through the financial statement issuance date for subsequent event disclosure or recording. Recently Issued Accounting Pronouncements In November 2024, FASB issued ASU 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses. The guidance in ASU 2024-03 requires public business entities to disclose in the notes to the financial statements, among other things, specific information about certain costs and expenses including purchases of inventory; employee compensation; and depreciation and amortization expense for each caption on the income statement where such expenses are included. The update is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted, and the amendments may be applied prospectively to reporting periods after the effective date or retrospectively to all periods presented in the financial statements. The Company is currently evaluating the provisions of this guidance and assessing the potential impact on its financial statement disclosures. We have reviewed all accounting pronouncements recently issued by the FASB and the SEC. The authoritative pronouncements that we have already adopted did not have a material effect on our financial condition, results of operations, cash flows or reporting thereof, and except as otherwise noted above, we do not believe that any of the authoritative pronouncements that we have not yet adopted will have a material effect upon our financial condition, results of operations, cash flows or reporting thereof. F- 12 NOTE 3 – GOING CONCERN The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern. The Company incurred net losses of $ 5,521,000 for the year ended October 31, 2025 and used $ 718,000 of cash from operating activities during that period. In addition, the Company had an accumulated deficit and a stockholders’ deficit of $ 67,734,000 and $ 1,423,000 , respectively, at October 31, 2025. The Company had a working capital deficit of $ 1,915,000 at October 31, 2025. United States Food and Drug Administration (“FDA”) regulations which were announced in November 2017 and which became effective in May 2021 require that the sale of products that fall under Section 351 of the Public Health Services Act pertaining to marketing traditional biologics and human cells, tissues and cellular and tissue based products (“HCT/Ps”) can only be sold pursuant to an approved biologics license application (“BLA”). Notwithstanding the above, certain states, including Florida (SB 1768) have approved legislation that permits the use and sale of products that would otherwise be restricted under current FDA regulations. The Company has not obtained any opinion or ruling regarding the Company’s operations and whether the processing, sales and distribution of the products it currently produces would be subject to the FDA’s previously announced intended enforcement policies regarding HCT/P’s. As a result of the above, the Company’s efforts to establish a stabilized source of sufficient revenues to cover operating costs has yet to be achieved and ultimately may prove to be unsuccessful unless (a) the Company’s ability to process, sell and distribute the products currently being produced or developed in the future are not restricted; and/or (b) additional sources of working capital through operations or debt and/or equity financings are realized. These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management anticipates that the Company will remain dependent, for the near future, on additional investment capital to fund ongoing operating expenses and research and development costs related to development of new products and to perform required clinical studies in connection with the sale of its products. The Company does not have any assets to pledge for the purpose of borrowing additional capital. In addition, the Company relies on its ability to produce and sell products it manufactures that are subject to changing technology and regulations that it currently sells and distributes to its customers. The Company’s current market capitalization, common stock liquidity and available authorized shares may hinder its ability to raise equity proceeds. The Company anticipates that future sources of funding, if any, will therefore be costly and dilutive, if available at all. In view of the matters described in the preceding paragraphs, recoverability of the recorded asset amounts shown in the accompanying consolidated balance sheet assumes that (a) the Company is able to continue to produce products or obtain products under supply arrangements which are in compliance with current and future regulatory guidelines; (b) the Company will be able to establish a stabilized source of revenues, including efforts to expand sales internationally and the development of new product offerings and/or designations of products; (c) obligations to the Company’s creditors are not accelerated; (d) the Company’s operating expenses remain at current levels and/or the Company is successful in restructuring and/or deferring ongoing obligations; (e) the Company is able to continue its research and development activities, particularly in regards to remaining compliant with the FDA and ongoing safety and efficacy of its products; and/or (f) the Company obtains additional working capital to meet its contractual commitments and maintain the current level of Company operations through debt or equity sources. There is no assurance that the products we currently produce will not be subject to the FDA’s previously announced intended enforcement policies regarding HCT/P’s and/or the Company will be able to complete its revenue growth strategy. There is no assurance that the Company’s research and development activities will be successful or that the Company will be able to timely fund the required costs of those activities. Without sufficient cash reserves, the Company’s ability to pursue growth objectives will be adversely impacted. Furthermore, despite significant effort since July 2015, the Company has thus far been unsuccessful in achieving a stabilized source of revenues. If revenues do not increase and stabilize, if the Company’s ability to process, sell and/or distribute the products currently being produced or developed in the future are restricted, and/or if additional funds cannot otherwise be raised, the Company might be required to seek other alternatives which could include the sale of assets, closure of operations and/or protection under the U.S. bankruptcy laws. As of October 31, 2025, based on the factors described above, the Company concluded that there was substantial doubt about its ability to continue to operate as a going concern for the 12 months following the issuance of these financial statements. F- 13 NOTE 4 – INVENTORIES Schedule of inventories October 31, 2025 October 31, 2024 Raw materials and supplies $ 208,000 $ 164,000 Finished goods 215,000 68,000 Total inventories $ 423,000 $ 232,000 NOTE 5 – PROPERTY AND EQUIPMENT Schedule of property and equipment October 31, 2025 October 31, 2024 Finance lease equipment $ 156,000 $ 13,000 Manufacturing equipment 778,000 757,000 934,000 770,000 Less: accumulated depreciation ( 365,000 ) ( 292,000 ) Total property and equipment, net $ 569,000 $ 478,000 Depreciation expense totaled $ 73,000 and $ 74,000 for the years ended October 31, 2024 and 2023, respectively. NOTE 6 – EQUITY IN NON-MARKETABLE SECURITIES OF AFFILIATED ENTITY Schedule of equity in non marketable securities October 31, 2025 October 31, 2024 Equity in non-marketable securities $ 145,000 145,000 Reserve on carrying value of investment in non-marketable securities $ ( 145,000 ) ( 145,000 ) Equity in non-marketable securities $ - - During the year ended October 31, 2024, pursuant to a capital call notice received from Exotropin LLC, a privately held skin-care formulator (“Exotropin”), the Company invested an additional $45,000 in cash (representing its 8.96% equity interest at the time of the capital call). During November 2024, the Company received a capital call notice from Exotropin, in which the Company’s pro-rata share was $126,000 (“November Capital Call”). The Company elected not to participate in the November Capital Call and as a result, its interest in Exotropin has been reduced to approximately 5.6%. There have been no further capital calls. Both Greyt Ventures, LLC (“Greyt”), a principal shareholder of the Company and Skycrest Holdings, LLC, (“Skycrest”) a former principal shareholder of the Company, each own a 17.93% interest in Exotropin. In addition, Mr. Robert Smoley, a consultant and advisor to the Company was also the Chief Operating Officer of Exotropin (until November 2024). In addition, the Company’s CMO was granted an option to acquire up to 200,000 membership interests in Exotropin, of which 100,000 vested immediately and the remaining 100,000 will vest based on future sales of Exotropin attributed to the CMO. The option price is $20,000 for the 200,000 membership interests. F- 14 As of October 31, 2025 and 2024, the Company has recorded total reserves against the carrying value of its investment of Exotropin of $ 145,000 and $ 145,000 respectively, based on the limited financial history of Exotropin to date to ascertain the fair value of Exotropin and the Company’s limited rights to control future dilution to the Company’s interests and the timing of available distributions, if any, of Exotropin. As such, at October 31, 2025 and 2024, the carrying value of the Company’s investments in equity securities without readily determinable fair values totaled $0. The Company evaluated its ownership, contractual and other interests in this entity and determined the Company does not have a variable interest in this entity and therefore it is not required to be consolidated in the Company’s consolidated financial statements, as the Company is not the primary beneficiary and does not have the power to direct activities that most significantly impact the entities’ economic performance. The Company’s maximum loss exposure is limited to the carrying value of this investment. Sales Representative Agreement In November 2023, the Company entered into a Sales Representative Agreement (the “Sales Agreement”) with Exotropin to support the commercialization of its proprietary topical products. Under the Sales Agreement, the Company is entitled to receive commissions on the net sales value of Exotropin products sold to pre-approved customers introduced by the Company, including retailers (10%), wholesale distributors (5%), private label customers (10%), and direct-to-consumer customers (15%). In connection with the Sales Agreement, the Company and Exotropin co-developed a topical product for the treatment of hair loss, branded as “ZEO HAIR GROW™ Powered By Exotropin™,” which launched in November 2024 (the “Collaboration”). Under the terms of the Collaboration, the Company is responsible for sales and marketing, and the parties agreed to share equally in the net profits from product sales, after reimbursement of direct cash costs incurred by either party. On August 15, 2025, the Company provided Exotropin with formal notice of termination of the Sales Agreement for cause (see Note 14). For the years ended October 31, 2025 and 2024, $ 61,000 and $ 87,000 , respectively, of commissions were earned under the Sales Agreement. The commissions earned under the Sales Agreement are reflected in other income in the consolidated financial statements. Joint Supply Agreement During September 2023, the Company and Exotropin entered into an agreement whereby Exotropin agreed to supply the Moisturizer that the Company is obligated to supply under the Amended Skincare Agreement. Pursuant to the Sales Agreement, the Company paid Exotropin $235,000 representing the amount of Initial Purchase Order associated with the Company’s arrangement with Exotropin to supply the Moisturizer (“Moisturizer Prepayment”). On August 12, 2024, in connection with the mutual agreement to terminate the Amended Skincare Agreement, the Company and Exotropin entered into a settlement and general release (“Release”) whereby the parties released each other from all outstanding duties and/or obligations owed by one party to the other party as set forth in the Release including but not limited to Exotropin’s obligation to supply any Moisturizer to the Company pursuant to the Amended Skincare Agreement and the Company’s obligation to make or place any additional orders to Exotropin for the Moisturizer. In connection with the Release, Exotropin retained the Moisturizer Prepayment made by the Company to Exotropin, and Exotropin was not obligated to deliver any of the Moisturizer to the Company, including portion of the Moisturizer to be provided in connection with the Moisturizer Prepayment (see Note 14). F- 15 NOTE 7 – FINANCE LEASE OBLIGATIONS During April 2025, the Company entered into a lease agreement for certain lab equipment in the amount of $ 125,000 (“Lease Agreement”). The Lease Agreement was accounted for as a finance lease obligation. Under the terms of the lease agreement, the Company is required to make 60 equal monthly payments of $ 1,600 plus applicable sales taxes. Under the lease agreement, the Company has the option to acquire all of the leased equipment for a nominal amount upon termination of the lease. The annual interest rate charged in connection with the lease is 2.7 % . Lease payments and depreciation of the leased equipment began during June 2025, the date that the lease equipment was installed and became operational. The leased equipment is included in Property and equipment and is being depreciated over their estimated useful lives of 15 years beginning from the date it became operational. During June 2025, the Company entered into a lease agreement for certain lab equipment in the amount of $ 15,000 (“Lease Agreement”). The Lease Agreement was accounted for as a finance lease obligation. Under the terms of the lease agreement, the Company is required to make 36 equal monthly payments of $ 500 plus applicable sales taxes. Under the lease agreement, the Company has the option to acquire all of the leased equipment for a nominal amount upon termination of the lease. The annual interest rate charged in connection with the lease is 8.0 % . Lease payments and depreciation of the leased equipment began during June 2025, the date that the lease equipment was installed and became operational. The leased equipment is included in Property and Equipment and is being depreciated over it estimated useful life of 3 years beginning from the date it became operational. As of October 31, 2025 and 2024, finance lease obligations were $ 110,000 and $ 13,000 , respectively, of which $ 33,000 and $ 5,000 were current, respectively. The weighted average remaining term of the Company’s finance leases as of October 31, 2025 was 43.2 months. The minimum lease payments pursuant to the finance lease are as follows: Schedule of minimum lease payment to finance lease Year Ended October 31, Minimum Rent 2026 $ 36,000 2027 28,000 2028 23,000 2029 20,000 2030 10,000 Thereafter - Total undiscounted finance lease payments 117,000 Less: imputed interest ( 7,000 ) Present value of finance lease liabilities $ 110,000 Other Leases The Company leases its administrative and research facility on a month-to-month basis. Rent expense was $ 20,000 and $ 20,000 during the years ended October 31, 2025 and 2024, respectively. NOTE 8 – RELATED PARTY TRANSACTIONS For the years ended October 31, 2025 and 2024, the Company sold a total of approximately $ 88,000 and $ 199,000 , respectively, of product to a management services organization (“MSO”) that provides administrative services and contracts for medical supplies for several medical practices, of which Dr. George Shapiro, the Company’s Chief Medical Officer and a member of the board of directors has an indirect economic interest in the parent company that owns the MSO. During the year ended October 31, 2024, the Company wrote-off the full balance of the advances payable to an affiliate of a former executive of $ 221,000 . The Company recorded the write-off as other income during the year ended October 31, 2024. F- 16 During the year ended October 31, 2024, pursuant to a capital call notice received from Exotropin LLC, a privately held skin-care formulator (“Exotropin”), the Company invested an additional $ 45,000 in cash (representing its 8.96% equity interest at the time of the capital call). During November 2024, the Company received a capital call notice from Exotropin, in which the Company’s pro-rata share was $126,000 (“November Capital Call”). The Company elected not to participate in the November Capital Call and as a result, its interest in Exotropin has been reduced to approximately 5.6%. Both Greyt Ventures, LLC (“Greyt”), a principal shareholder of the Company and Skycrest Holdings, LLC, (“Skycrest”) a former principal shareholder of the Company, each own a 17.93% interest in Exotropin. In addition, Mr. Robert Smoley, a consultant and advisor to the Company was also the Chief Operating Officer of Exotropin (until November 2024). In addition, the Company’s CMO was granted an option to acquire up to 200,000 membership interests in Exotropin, of which 100,000 vested immediately and the remaining 100,000 will vest based on future sales of Exotropin attributed to the CMO. The option price is $20,000 for the 200,000 membership interests. NOTE 9 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES Schedule of account payable and accrued expenses October 31, 2025 October 31, 2024 Accrued payroll related liabilities $ 667,000 $ 667,000 Lab equipment and supplies payables 120,000 54,000 Clinical trial and research payables 634,000 648,000 Legal fees payable 244,000 127,000 Other professional fees payable 121,000 119,000 Interest payable 1,000 5,000 Royalty payable 100,000 - Accrued commissions payable 37,000 18,000 Construction payables 9,000 9,000 Other payables and accrued expenses 47,000 72,000 Total Accounts Payable and Accrued Expenses $ 1,980,000 $ 1,719,000 NOTE 10 – NOTES PAYABLE Schedule of notes payable October 31, 2025 October 31, 2024 Convertible Promissory Notes $ 250,000 $ 725,000 Unamortized discount ( 7,000 ) ( 45,000 ) Total Notes Payable $ 243,000 $ 680,000 Convertible Promissory Notes During the period August 2023 through September 2023, the Company sold 2.9 Units (“Units”) to 4 investors in a private offering at a purchase price of $ 250,000 per Unit for an aggregate purchase price of $ 725,000 . Each Unit consists of (a) a $ 250,000 in principal amount 8 % Convertible Promissory Note due September 30, 2026 (“Note ” ); and (b) 7,813 common stock purchase warrants (the “Warrants”), each entitling the holder to purchase one share of common stock, $ 0.001 par value (“Shares”) at an exercise price of $ 20.00 for a period of five years from the date of issuance. Interest on the Notes are payable annually and together with the principal amount on the Maturity Date. F- 17 The Notes may be prepaid by the Company, in whole, but not in part, at any time prior to the Maturity Date, subject to payment of a premium of 10%, provided that the Company gives the holders fifteen (15) business notice prior to prepayment, during which period, Investors may elect to convert the Notes and accrued but unpaid interest thereon into Shares at a conversion price equal to 80% of the average of the daily VWAP of the Shares (as defined in the Note) for twenty consecutive (20) trading days ending on the date the Company gives the holders of the Notes notice of prepayment. Holders of the Notes (“Holders”) will have the right, at any time during the period commencing on April 1, 2024 and ending on the earliest to occur of the Maturity Date, the date of a Prepayment or the date of an automatic conversion, to convert the Note in whole, but not in part, and accrued interest thereon into Shares at a conversion price equal to 80% of the average of the daily VWAP of the Shares (as defined in the Note) for twenty consecutive ( 20 ) trading days ending on the date the investor gives the Company a notice of conversion, subject to a minimum conversion price of $ 6.00 per Share. In addition, the Notes and accrued but unpaid interest thereon will automatically convert into Shares in the event that prior to the Maturity Date, the Company consummates a “Qualified Financing” or a “Qualified Sale” (as defined in the Note) at a conversion price equal to 80% of the offering price of Shares sold in the Qualified Financing or 80% of the purchase price per Share to be received by stockholders following consummation of a Qualified Sale. The balance of the notes payable was $ 725,000 at October 31, 2024. On October 3, 2025, the Company offered each Holder of the Notes the opportunity to convert their Note on October 10, 2025 (including accrued interest outstanding) at a conversion price equal to $ 3.00 per share (“Conversion Offer”). The Holders of a total of $ 475,000 principal amount of Notes (including $39,000 of accrued interest as of October 10, 2025) agreed to accept the Conversion Offer and accordingly received an aggregate total of 171,347 shares of common stock of the Company. In connection with the conversion of the Notes, the Company recorded an inducement expense of $ 136,000 representing the fair value of the additional shares that were issued in the conversion (t he trading price of the Company’s common stock on the date of conversion was $1.59 per share) over the amount of shares convertible pursuant to the original terms of the Notes. As of October 31, 2025, the remaining outstanding Notes of $ 250,000 are convertible into a maximum of 41,667 shares. The fair value of the Warrants issued was $ 80,000 . The Company recorded a discount of the Note in the amount of $72,000 at issuance, representing the allocable fair market value of the Note and the Warrants. The discount is being amortized over the term of Note. For the years ended October 31, 2025 and 2024, $ 39,000 (including $15,000 of unamortized discounts associated with the converted Notes outstanding as of October 10, 2025) and $ 23,000 , respectively, of the discounts recorded in connection with the issuance of the Note have been amortized, resulting to unamortized debt discount of $ 7,000 and $ 45,000 as of October 31, 2024 and 2023, respectively. During the year ended October 31, 2025 and October 31, 2024, the Company has paid $ 20,000 and $ 64,000 respectively, of interest on the Notes. The securities were offered and sold in a private offering exempt from the registration requirements of the Securities Act, pursuant to the exemptions from registration afforded by Rule 506(b) of Regulation D under the Securities Act. F- 18 NOTE 11 – INCOME TAXES The Company files a consolidated federal income tax return that includes all of its subsidiaries. For the years ended October 31, 2025 and 2024, the Company incurred operating losses, and therefore, there was not any current income tax expense amount recorded during those periods. The consolidated provision for income taxes for October 31, 2025 and 2024 consists of the following: Schedule of provision for income tax Year Ended October 31, 2025 Year Ended October 31, 2024 Current: Federal $ - $ - State - - Current Income Tax Expense (Benefit) $ - $ - Deferred: Federal $ ( 312,663 ) $ ( 206,578 ) State ( 36,789 ) ( 10,142 ) Deferred Income Tax Expense (Benefit) ( 349,452 ) ( 216,720 ) Change in Valuation Allowance 349,452 216,720 Income tax provision $ - $ - Effective tax rates differ from the federal statutory rate of 21 % for 2025 and 2024 applied to income before income taxes. A reconciliation of the U.S. federal statutory tax amount to the Company’s effective tax amount is as follows: Schedule of effective income tax rate October 31, 2025 October 31, 2024 Tax at federal statutory rate $ ( 1,112,772 ) $ ( 988,494 ) State taxes, net of federal benefit ( 264,946 ) ( 61,193 ) Permanent differences - - Stock-based compensation 1,197,820 1,001,819 Other ( 169,554 ) ( 168,852 ) Total income tax expense (benefit) ( 349,452 ) ( 216,720 ) Change in valuation allowance 349,452 216,720 Income tax provision $ - $ - The Company had a federal net operating loss carryover of $ 18,977,000 as of October 31, 2025, of which 98% is available to offset future taxable income indefinitely. The Company had state net operating loss carryovers of $ 11,975,000 of which $ 8,574,000 , carryover indefinitely and the balance expires in varying amounts through 2041. F- 19 The tax effects of temporary differences and carry-forwards that give rise to deferred tax assets and liabilities for the Company were as follows: Schedule of deferred tax assets and liabilities October 31, 2025 October 31, 2024 Deferred Tax Assets: Stock based compensation $ 3,847,643 $ 2,643,604 Net operating loss carryforward-Federal 3,985,166 3,657,425 Net operating loss carryforward-State 614,924 541,515 Other - - Total deferred tax assets: 8,447,733 6,842,544 Deferred Tax Liabilities: Property and equipment 143,766 309,778 Total deferred tax liabilities: 143,766 309,778 Valuation Allowance ( 8,303,967 ) ( 6,532,766 ) Net deferred tax assets $ - $ - FASB ASC 740 requires a valuation allowance against deferred tax assets if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. At October 31, 2025 and October 31, 2024, the net deferred tax asset was offset by a full valuation allowance. Pursuant to Code Sec. 382 of the Internal Revenue Code (“the Code”), the utilization of net operating loss carryforwards may be limited as a result of a cumulative change in stock ownership of more than 50% over a three-year period. The Company may be subject to such limitation. I R S Penalties As of October 31, 2023, the Company had accrued $ 86,000 of accrued tax penalties and interest on the balance sheet in connection with penalties and interest assessed by the Internal Revenue Service (“IRS”) for delinquent income tax returns for the periods since inception through the tax year ended October 31, 2016 that were not filed until December 2017 (“Delinquent Filed Returns”). The Company filed a “Request for Collection Due Process Equivalent Hearing” (“Request”) in September 2021 seeking an abatement of the penalties and interest. A hearing was held on June 28, 2022 and during February 2024, the IRS notified the Company that the Company’s appeal for full abatement of penalties and interest ($92,000 as of February 2024) associated with the Delinquent Filed Returns was granted. The Company recorded the abatement as other income for the year ended October 31, 2024. NOTE 12 – CAPITAL STOCK Preferred Stock The Company is authorized to issue 10,000,000 shares of $ 0.001 par value preferred stock in one or more designated series, each of which shall be so designated as to distinguish the shares of each series of preferred stock from the shares of all other series and classes. The Company’s board of directors is authorized, without stockholders’ approval, within any limitations prescribed by law and the Company’s Articles of Incorporation, to fix and determine the designations, rights, qualifications, preferences, limitations and terms of the shares of any series of preferred stock. F- 20 Series C Preferred Shares On August 17, 2022, the Company filed a Certificate of Designation for a newly created Series C Non-Convertible Preferred Stock consisting of 100 shares, $ 0.001 par value of authorized but unissued preferred stock of the Company (“Series C Preferred Shares”). The Company initially issued each of Skycrest and Greyt, 50 shares of the Series C Preferred Shares in connection with a “change in control” transaction” consummated in August 2022 (see Note 16). On December 17, 2024, the Company filed an Amendment (the “Amendment”) to the Certificate of Designation of our Series C Preferred Shares. During December 2024, Skycrest requested that it be allowed to transfer the 50 shares of Series C Preferred Shares of the Company it holds to Ian T. Bothwell, the Company’s Chief Executive Officer and Chief Financial Officer (“Transfer”). In December 2024, the Board of Directors of the Company approved the Transfer and the Transfer was completed. The Series C Preferred Shares vote together with shares of our common stock as a single class on all matters presented to a vote of stockholders and represent 51% of the voting control of the Company, except as required by law. The Series C Preferred Shares are not convertible into common stock, do not have any dividend rights and do have a nominal liquidation preference. The Series C Preferred Shares also have certain protective provisions, such as requiring the vote of a majority of Series C Preferred Shares to change or amend their rights, powers, privileges, limitations and restrictions, including the assignment of interests and redemption provisions. Common Stock On November 7, 2023, the Company filed a certificate of amendment to its Articles of Incorporation to affect a reverse split of our issued and outstanding common stock on a one-for-two-hundred basis. The reverse stock split was effective with FINRA on November 28, 2023 (the “Reverse Split”). The par value of the Company’s common stock was unchanged at $0.001 per share after the Reverse Split. All share and per share amounts have been retroactively adjusted to reflect the split as if it occurred at the earliest period presented. 2021 Plan In September 2021, the Company adopted the 2021 Equity Incentive Plan (“2021 Plan”). The 2021 Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units, and Performance Shares (an “Award”) to any person who is an employee or director of, or consultant to the Company. The maximum aggregate number of shares that may be issued pursuant to all Awards was 1,250,000 shares. On June 6, 2023, the Company’s board of directors and stockholders holding a majority of the Company’s voting power, approved an increase in the number of shares of the Company’s common stock reserved for issuance under the Company’s 2021 Plan from 1,250,000 shares to 2,500,000 shares. The 2021 Plan is administered by (a) the board of the directors of the Company; or (b) a committee designated by the board, which Committee shall be constituted in such a manner as to satisfy the applicable laws and to permit such grants and related transactions under the Plan to be exempt from Section 16(b) of the Exchange Act in accordance with Rule 16b-3. Once appointed, such committee shall continue to serve in its designated capacity until otherwise directed by the board. The board of directors may at any time amend, suspend, or terminate the Plan; provided, however, that no such amendment shall be made without the approval of the Company’s shareholders to the extent such approval is required by applicable laws. As of October 31, 2025, a total of 1,595,482 Awards (net of 1,243,647 Awards redeposited for future issuance) that have been awarded under the 2021 Plan remain issued and outstanding. As of October 31, 2024, a total of 1,386,288 Awards (net of 1,211,500 Awards redeposited for future issuance) that have been awarded under the 2021 Plan were issued and outstanding. F- 21 Sale Of Common Stock On July 8, 2024, the Company completed a $500,000 private financing (“Financing”) with a single accredited investor (“Investor”). In the Financing, the Company sold and issued to the Investor 250,000 shares of common stock (“Shares”) and warrants to purchase an additional 83,333 Shares (the “Warrants”) (see Note 13). In connection with the Financing, the Company agreed to provide the Investor certain piggy-back registration rights under the Securities Act of 1933, as amended (“Securities Act”) with respect to the Shares purchased and the Shares underlying the Warrants purchased. The proceeds are being used for working capital purposes. On July 25, 2025, ZEO entered into a subscription agreement with a single accredited investor (the “Investor”). Pursuant to which the Investor agreed to purchase 250,000 shares of our common stock (the “Shares”) in a private transaction for an aggregate purchase price of $1,000,000 (the “Purchase Price”). The Shares will be issued and sold and the Purchase Price paid in ten (10) equal monthly installments commencing on August 1, 2025 and ending on May 1, 2026. The August 1, 2025, September 1, 2025 and October 1, 2025 installment payments in the aggregate amount of $300,000 were made in accordance with the subscription agreement and the Company issued the investor an aggregate of 75,000 Shares. The Investor has not made the November 2025, December 2025 and January 2026 installment payments. As of October 31, 2025, the investor has yet to purchase the remaining 175,000 shares under the agreement. The proceeds from the issuance of those shares will be recorded upon receipt and issuance of the shares. Restricted Stock Awards 2024 Issuances Effective January 31, 2024, the Company and a legal firm performing services to the Company agreed to exchange $ 20,000 of legal fees payable due to the legal firm for 20,000 shares of newly issued common stock valued at $ 20,000 , representing a 20% discount to the closing price of the common stock of the Company on the date the arrangement was agreed to by both the Company and the legal firm. The shares were issued to the legal firm in April 2024. Effective April 1, 2024, the Company entered into sales distribution agreement with a sales and marketing company (“Salesco”). Salesco will be entitled to receive commissions on sales of the Company’s products to customers introduced by Salesco in the form of cash and common stock of the Company based on sales milestones. In connection with the agreement, the Company agreed to pay Salesco a monthly advance of $ 15,000 for the first 6 months, provided however, that the last 2 monthly retainers are subject to Salesco achieving a certain minimum amount in sales during the applicable month. The monthly retainers are to be repaid from commissions earned by Salesco on sales of the Company’s products that are generated through Salesco. In addition, Salesco was granted 30,000 shares of the Company’s common stock which vests over 2 years, quarterly, except the quarterly vesting period will “cliff vest” upon the Company receiving $ 300,000 in cumulative sales from customers introduced by Salesco. The agreement may be terminated by the Company upon the six-month anniversary of the agreement. The 30,000 grant of shares were valued at $2.00 per share, the closing price of the common stock of the Company on the effective date of the agreement. The Company will amortize $ 60,000 of stock-based compensation expense over the 2 -year vesting terms. The Company recorded $ 8,000 and $ 18,000 of stock-based compensation expense during the years ended October 31, 2025 and 2024, respectively. During April 2024 thru August 2024, in consideration for agreeing to serve on the Company’s medical advisory board, the Board approved the issuance to a total of twenty individuals an aggregate of 155,000 shares of unregistered common stock valued at ranges between $ 1.04 per share and $ 2.75 per share, the closing price of the common stock of the Company on the respective grant dates. The shares vest annually over the three-year period from the date of grant. The Company will amortize $ 271,000 of stock-based compensation expense over a three-year vesting period. The Company recorded $ 82,000 and $ 57,000 of stock-based compensation expense during the years ended October 31, 2025 and 2024, respectively. F- 22 On April 1, 2024, pursuant to the Company’s 2021 Incentive Stock Plan (“Incentive Plan”), the Company’s Board of Directors (“Board”) awarded 125,000 and 62,500 shares of the Company’s common stock to Jerry Glauser and Leatham Stern or their nominees, respectively (“Stock Grants”), both members of the Board, valued at $2.00 per share, the closing price of the common stock of the Company on the grant date. The Stock Grants vest in full as of the date of the grant. The Company recorded a total of $375,000 of stock-based compensation expense during the year ended October 31, 2024, in connection with the Stock Grants. 2025 Issuances Effective February 1, 2025, in connection with an agreement with an independent sales representative (“Representative”), the Company agreed to grant the Representative 40,000 shares of the Company’s common stock which shall vest quarterly over a 2-year period beginning with the first month subsequent to the monthly period that the Representative has generated a cumulative amount of sales for the Company in excess of $500,000 (“Sales Milestone”). Upon a termination of the Agreement for cause or the failure of the Representative to achieve the Sales Milestone during the 1 st year of the Agreement, all unvested shares as of such time shall be forfeited (except in the case of a sale of the Company). In addition, the Representative will be entitled to receive commissions on sales of the Company’s products to customers introduced by the Representative in the form of cash and common stock of the Company based on sales milestones. The agreement may be terminated by the Company at any time upon 30 days written notice for failure of Representative to meet sales targets, to be solely determined by the Company. The fair value of the shares as of the date of grant was $ 104,000 . The Company will amortize $ 104,000 of stock-based compensation expense over the vesting term of the agreement beginning once the Representative has achieved the minimum Sales Milestone. As Consultant has not met Sales Milestone, there was no expense recognized during the period. On May 8, 2025, the Company entered into an agreement with a non-affiliated consultant (the “Consultant”) to advise the Company on strategic communication investor relation programs (“Consulting Agreement”). In connection with the Consultant Agreement, the Company granted the Consultant 100,000 shares of common stock (“Shares”) and warrants to purchase an additional 500,000 shares of common stock (the “Warrants”). 50,000 of the Shares vested upon execution of the Consulting Agreement and the remaining 50% will vest on the six-month anniversary of the Consulting Agreement. The fair value of the Shares as of the date of grant was $286,000. The Company will amortize the $286,000 of stock-based compensation expense over the term of the Consulting Agreement. The Company amortized $143,000 of expense for the year ended October 31, 2025. The Warrants vest in five equal tranches of 100,000 shares, at various exercise prices ranging between $3.50 - $10.00 per share, and are exercisable on the terms provided in the Consulting Agreement. Once vested, the Warrants are exercisable for a period of ninety (90) days from the date they become exercisable. The Company valued the warrants on the date of the grant using the Black-Scholes option pricing model with the following weighted average assumptions: (1) risk free interest rate 4.00%, (2) term of 3 years, (3) expected stock volatility of 143%, and (4) expected dividend rate of 0%. The grant date fair value of the warrants granted was $ 1,428,000 . The Company will amortize $ 1,428,000 of stock-based compensation based on the vesting of the Warrants. Effective May 23, 2025, in connection with an agreement with a second consultant (“Second Consultant”), the Company agreed to grant the Second Consultant 40,000 shares of the Company’s common stock which shall vest quarterly over a 2-year period commencing on the date that sales obtained by the Company from customers introduced by Second Consultant exceed $400,000 (“Milestone”) and provided that the Milestone is achieved by December 31, 2025. Upon termination of the agreement for any reason, any unvested stock shall be forfeited. In addition, the Second Consultant will be entitled to receive commissions on sales of the Company’s products to customers introduced by the Representative in the form of cash and common stock of the Company based on sales milestones. The agreement may be terminated by the Company at any time by either party upon 30 days written notice. The fair value of the shares as of the date of grant was $ 82,000 . The Company will amortize $ 82,000 of stock-based compensation prorata over the vesting period once the Consultant has achieved minimum Sales Milestone. On June 25, 2025, in connection with the Acquisition (see Note 16), the Company issued 30,000 restricted shares of the Company’s common stock valued at $ 58,000 . F- 23 A summary of unvested restricted stock activity for the years ended October 31, 2025 and 2024 are presented below: Schedule of non vested share activity Number of Non-vested Shares Fair Value Weighted-Average Grant Date Value Non-vested Shares at October 31, 2023 100,000 $ - $ - Non-vested Shares Granted 185,000 $ 331,000 $ 1.79 Vested - $ ( 74,000 ) $ - Expired/Forfeited ( 100,000 ) $ - $ - Non-vested Shares at October 31, 2024 185,000 $ 257,000 $ 1.79 Non-vested Shares Granted 130,000 $ 372,000 $ 2.54 Vested ( 105,000 ) $ ( 233,000 ) $ - Expired/Forfeited ( 31,667 ) $ ( 46,000 ) $ - Non-vested Shares at October 31, 2025 178,333 $ 308,000 $ 2.05 The Company recorded a total of $ 233,000 of stock-based compensation expense based on the grant date fair value of these shares during the year ended October 31, 2025, respectively. The Company recorded a total of $ 74,000 of stock-based compensation expense based on the grant date fair value of these shares during the year ended October 31, 2024, respectively. There was approximately $ 308,000 of unamortized compensation associated with unvested stock grants outstanding as of October 31, 2025 that will be amortized over their respective remaining service periods. NOTE 13 – STOCK OPTIONS AND WARRANTS The Company has issued option securities under its Incentive Plan and warrants entitling the holder to purchase shares of its common stock at specified prices and for specified exercise periods. Options: A summary of the Company’s option activity for the years ended October 31, 2024 and 2023 are presented below: Schedule of stock options and warrants Number of Shares Weighted- average Exercise Price Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding at October 31, 2023 895,750 $ 2.97 5.67 $ - Granted 622,538 $ 2.52 9.42 $ - Exercised - $ - - $ - Expired/Forfeited ( 555,000 ) $ 2.53 3.74 $ - Outstanding at October 31, 2024 963,288 $ 2.94 8.07 $ - Granted 241,341 $ 2.90 5.00 $ - Exercised - $ - - $ - Expired/Forfeited ( 32,147 ) $ 3.40 4.12 $ - Outstanding at October 31, 2025 1,172,482 $ 2.91 6.61 $ - Exercisable at October 31, 2025 994,076 $ 2.95 6.75 $ - F- 24 2024 Options During the year ended October 31, 2024, under its Incentive Plan, the Board approved the granting of options to certain employees, officers and directors to purchase 622,538 shares of its common stock. The options vest over various periods ranging from 6 months to 3 years, expire five to ten years from the date of grant and had an aggregate fair value of $ 1,438,000 at the date of grant. The Company valued the options using a Black-Scholes option pricing model with the following assumptions: Schedule of assumptions used for the options granted Exercise prices $ 2.00 - $ 4.50 Expected dividends - Expected volatility 156 % - 159 % Risk free interest rate 4.20 % - 4.34 % Expected term of options 6.0 years During the year ended October 31, 2024, all options issued to Dr. Leider, the former Chief Executive Officer, that were not vested amounting to 190,000 at the time of the expiration of his employment agreement on May 31, 2024, were forfeited. In addition, all options issued to Dr. Leider and Dr. Howard Golub, the former Chief Science Officer, and an employee, that were vested amounting to 95,000 , 250,000 , and 20,000 , respectively, at the time of the expiration of their employment agreements, were not exercised by August 31, 2024 as required under the Incentive Plan, and as a result expired. 2025 Options During the year ended October 31, 2025, under its Incentive Plan, the Board approved the granting of options to certain employees to purchase 11,341 shares of its common stock. The options vest annually over 3 years, expire five years from the date of grant and had an aggregate fair value of $ 39,000 at the date of grant. The Company valued the options using a Black-Scholes option pricing model with the following assumptions: Schedule of assumptions used Exercise prices $ 4.50 Expected dividends - Expected volatility 152 % Risk free interest rate 4.36 % Expected term of options 5.0 years During the year ended October 31, 2025, the Board approved the granting of options to purchase an aggregate of 65,000 shares of its common stock to Dr. Everts, Chief Science and Technology Officer of the Company and Mr. Ron Borsheim, Chief Sales Officer of the Company in accordance with their employment agreements. The options are exercisable until the fifth anniversary date of the date of issuance and had an aggregate fair value of $ 177,125 . The options vest over a five-year periods. The Company valued the options using a Black-Scholes option pricing model with the following assumptions: Schedule of option pricing model assumptions Exercise prices $ 2.50 - $ 3.08 Expected dividends - Expected volatility 149 % - 151 % Risk free interest rate 3.91 % - 4.34 % Expected term of options 5.0 years F- 25 On May 8, 2025, under its Incentive Plan, the Board approved the granting of options to certain employees, officers and directors to purchase 165,000 shares of its common stock. 153,000 of the options vest immediately and 12,000 of the options vest over a 4-month period, expire five years from the date of grant and had an aggregate fair value of $ 472,000 at the date of grant. The Company valued the options using a Black-Scholes option pricing model with the following assumptions: Schedule of option pricing model Exercise prices $ 2.86 Expected dividends - Expected volatility 148 % Risk free interest rate 4.00 % Expected term of options 5.0 years Options totaling 32,147 that were previously issued to certain employees that were no longer employed by the Company as of October 31, 2025, were forfeited. During the years ended October 31, 2025 and 2024, the Company amortized $ 1,523,000 and $ 953,000 , respectively, of stock compensation costs associated with options vesting during the period. There was approximately $ 383,000 of unamortized compensation associated with options outstanding as of October 31, 2025 that will be amortized over their respective remaining service periods. Warrants: A summary of the Company’s warrant activity for the years ended October 31, 2025 and 2024 are presented below: Schedule of warrant activity Number of Shares Weighted- average Exercise Price Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding at October 31, 2023 1,675,906 $ 4.54 8.47 $ - Granted 883,333 $ 2.32 9.21 $ - Exercised - $ - - $ - Expired/Forfeited - $ - - $ - Outstanding at October 31, 2024 2,559,239 $ 3.77 7.97 $ - Granted 555,000 $ 2.86 3.20 $ - Exercised ( 21,277 ) $ 2.35 1.76 $ - Expired/Forfeited - $ - - $ - Outstanding at October 31, 2025 3,092,962 $ 3.62 6.24 $ - Exercisable at October 31, 2025 2,495,740 $ 3.82 6.89 $ - 2024 Warrants On July 8, 2024, in connection with the Financing (see Note 12), the Company issued the Investor a cashless warrant to purchase an aggregate of 83,333 shares of common stock. The warrant is exercisable for $ 2.00 per share (the closing price of the Company’s common stock on the date of grant was $1.66), until the tenth anniversary date of the date of issuance. The exercise price and number of shares issuable upon exercise of the warrant are subject to adjustment to give effect to stock splits, stock dividends and other recapitalization events and the sale of shares at a purchase price less than the exercise price then in effect. F- 26 On July 11, 2024, the Company granted warrants to purchase 350,000 shares of common stock to each of two consultants and then principal shareholders to the Company (“Consultants”). The Warrants vest in equal monthly installments over an eighteen (18) month period from the date of grant. Once vested, the Warrants are exercisable for a period of ten ( 10 ) years from the date of grant at an exercise price of $ 2.35 per share (subject to adjustment for stock splits, stock dividends and similar recapitalization events). The Consultants, who are the controlling stockholders of the Company, were also accorded piggy-back registration rights under the Securities Act of 1933, as amended (the “Securities Act”), with respect to the shares of common stock issuable upon exercise of the warrants. The Company valued the warrants on the date of the grant using the Black-Scholes option pricing model with the following weighted average assumptions: (1) risk free interest rate 4.20 % , (2) term of 10 years, (3) expected stock volatility of 159 % , and (4) expected dividend rate of 0 % . The grant date fair value of the warrants granted to each of the Consultants was $823,000 (total $ 1,645,000 ). The Company will amortize $ 1,645,000 of stock-based compensation expense over the vesting period of 18 months. In August 2024, the Company entered into an agreement with a third party to provide consulting services for a one-year period. As consideration for agreeing to provide consulting services to the Company, the Company agreed to issue the consultant vested warrants to purchase 100,000 shares of unregistered common stock. The Company valued the warrants on the date of the grant using the Black-Scholes option pricing model with the following weighted average assumptions: (1) risk free interest rate 3.96 % , (2) term of 3 years, (3) expected stock volatility of 147 % , and (4) expected dividend rate of 0 % . The grant date fair value of the warrants granted was $ 185,000 . The Company will amortize $ 185,000 of stock-based compensation expense over the term of the consulting agreement. 2025 Warrants In connection with the Consulting Agreement discussed in Note 12, during May 2025, the Company granted the Consultant warrants to purchase 500,000 shares of its common stock (the “Warrants”). The Warrants vest in five equal tranches of 100,000 shares, at various exercise prices ranging between $3.50 - $10.00 per share, and are exercisable based upon meeting certain conditions provided in the Consulting Agreement. Once vested, the Warrants are exercisable for a period of ninety (90) days from the date they become exercisable. The Company valued the warrants on the date of the grant using the Black-Scholes option pricing model with the following weighted average assumptions: (1) risk free interest rate 4.00%, (2) term of 3 years, (3) expected stock volatility of 143%, and (4) expected dividend rate of 0%. The grant date fair value of the warrants granted was $1,428,000. The Company will begin to amortize the $1,428,000 when management estimates the vesting the conditions are probable of being achieved. On May 8, 2025, the Company awarded warrants to purchase 55,000 shares of our common stock to Greyt Ventures, LLC, a principal shareholder of the Company in consideration of consulting services rendered to the Company. The warrants are fully vested as of the award date and are exercisable for a period of five ( 5 ) years from the award date at an exercise price of $ 2.86 per share. The Company valued the options using a Black-Scholes option pricing model with the following assumptions: Schedule of Black-Scholes option pricing model Exercise prices $ 2.86 Expected dividends - Expected volatility 148 % Risk free interest rate 4.00 % Expected term of options 5.0 years On July 25, 2025, the Company received notice from a holder of warrants to exercise 21,277 warrants to purchase 21,277 shares of common stock of the Company for a total exercise price of $50,000 ($2.35 per share). The proceeds were received, and the shares were issued on July 30, 2025. During the year ended October 31, 2025 and 2024, the Company amortized $ 2,937,000 and $ 2,450,000 , respectively, of stock compensation costs associated with warrants issued during the period. F- 27 There was approximately $ 1,270,000 of unamortized compensation associated with warrants outstanding as of October 31, 2025 that will be amortized over their respective remaining service periods. There was approximately $ 3,005,000 of unamortized compensation associated with warrants outstanding as of October 31, 2024 that will be amortized over their respective remaining service periods. All stock compensation expense is classified under general and administrative expenses in the consolidated statements of operations. NOTE 14 – COMMITMENTS AND CONTINGENCIES Joint Venture with BioXtek, LLC On February 4, 2025, the Company entered into a Binding Memorandum of Understanding (“Binding MOU”) with BioXtek, LLC, a Florida limited liability company (“BioXtek”) setting forth the terms of a joint development, manufacturing, marketing and funding arrangement to be entered into by the Company and BioXtek in various phases (“Joint Venture”). The Joint Venture contemplates, among other matters: ● The Company relocating its current operations located at Nova Southeastern University in Davie, Florida, to sublet space at the BioXtek Facility in Pompano Beach, Florida expected to be completed by May 31. 2025, which will include administrative, laboratory (research and development) and clean room (tissue processing) space, as well as shared common area space; ● The Company and BioXtek establishing a jointly-owned (50/50) special purpose entity (the “SPE”), to pursue the development and commercialization of agreed upon products including membrane patches that are used primarily in the wound care and surgical markets (“Membrane Products”), and conduct and complete required clinical trials and/or studies for mutually agreed upon indications and products with the goal of the SPE obtaining FDA approval in the form of a BLA license or other designated license required by the FDA to permit the SPE to commercialize the product(s) (the “SPE Business”). The Company and BioXtek have agreed to use their respective commercially reasonable efforts to secure funding for the SPE Business. In addition, under the terms of the Joint Venture, the SPE will become the exclusive distributor (subject to certain agreed upon exceptions for current customers of BioXtek) of the Membrane Products; ● In addition, as a result of the Joint Venture, the parties intend to seek operating efficiencies as a result of overlap in their respective operations, including administrative, laboratory and research personnel and research and manufacturing assets used in connection with the SPE Business and their respective individual businesses; The Company and BioXtek failed to execute and deliver the required series of definitive agreements documenting the Joint Venture, including the mutual agreement to modify certain terms as set forth in the Binding MOU with respect to the Company relocating its operations to BioXtek’s Pompano Beach, Florida manufacturing facility and the structure of how the parties will collaborate in future clinical trials and the sale of products that were intended to be sold pursuant to the Joint Venture (see Legal Matters below). Employment Agreements Dr. Peter A. M. Everts, Ph.D. Effective February 7, 2025, Dr. Peter A. M. Everts, Ph.D. (“Dr. Everts”) was appointed the Company’s Chief Scientific and Technology Officer. Dr. Everts’ employment agreement provides for a base salary of $ 220,000 for the first year and $ 235,000 per annum for each subsequent year it is in effect, subject to adjustment of up to $15,000, in the event certain compensation under a consulting agreement which Dr. Everts is party to with a non-affiliated third party is not paid. In connection with the employment agreement, Dr. Everts was granted an option under the 2021 Plan to purchase 25,000 shares of our common stock at a price of $3.05 per share (fair market value on the date of grant) (“Everts Option”). The Everts Option vests 50% on the one-year anniversary of the effective date of the employment agreement and 50% on the second anniversary, contingent upon Dr. Everts’ continued employment with the Company and to the extent vested, expires five years from the date of grant. F- 28 Dr. Everts’ employment with the Company is “At Will” meaning that his employment with the Company and his employment agreement may be terminated by the Company at any time, for any reason or for no reason at all and with or without “Cause” (as defined in the Agreement). Notwithstanding the foregoing, if at any time after the first ninety (90) days of the term, the Company terminates Dr. Everts’ employment without Cause or Dr. Everts terminates his employment with the Company for “Good Reason” (as defined in the Agreement), Dr. Everts will be entitled to receive an amount equal to one quarter (1/4) month’s salary for each successive three (3) months of employment completed as severance. On July 18, 2025, Dr. Everts resigned his position with the Company effective August 1, 2025. As a result of Dr. Everts resignation, the Everts Option was forfeited effective August 1, 2025. Purchase Commitments During July 2025, the Company entered into an exclusive supply agreement (“Supply Agreement”) with a third-party contract manufacturer (“CDMO”) in connection with the manufacturing and processing of certain biological products (“CDMO Products”) that the Company intends to sell to third party medical providers. Under the terms of the Supply Agreement, the Company paid an initial deposit of $225,000 on August 1, 2025 and is required to pay an additional $225,000 deposit upon confirmation that the CDMO has initiated cGMP processing of the CDMO Products. Under the terms of the Supply Agreement, the deposits will be applied against the actual CDMO Products that are released to the Company. The Company has agreed to make a minimum of 8 purchase orders within specified periods based on satisfactory release of prior productions of the CDMO Products (“Minimum Purchase Orders”). In connection with each purchase order, the Company is required to have minimum deposits paid to the CDMO equal to 50% of the value of the purchase order. The Supply Agreement may be extended by the Company based on submitting a minimum amount of additional purchase orders after the Minimum Purchase Orders have been released. Skincare Agreement In September 2022, the Company entered into a joint development agreement and supply agreement with a third-party supplier (“Supplier”) that develops and manufactures various devices and related equipment and consumables used in the skincare industry (“Skincare Agreement”) that are marketed and sold directly and/or through its affiliates or third parties, in the United States of America and in most major international markets. Under the terms of the Skincare Agreement, the Company was obligated to provide and the Third Party was obligated to purchase a minimum volume of raw material ingredient (“Ingredient”) from the Company to be used as part of formulations in exclusive biologic topical products (“Products”) to be marketed and sold by Supplier during the first year of the Agreement in the amount of $ 167,000 (“Minimum Purchase”) and mutually agreed upon minimal annual amounts thereafter. In June 2023, the Supplier informed the Company that there were delays in the Supplier’s development of the Products, including the timing of providing a purchase order for the Minimum Purchase of the Company’s Ingredient. During September 2023, the Company and the Supplier agreed to enter into an Amendment and Restatement of the Skincare Agreement (“Amended Skincare Agreement”). Under the terms of the Amended Skincare Agreement, the products to be provided by the Company was modified to include both the Ingredient and a topical moisturizer (“Moisturizer”) supplied by Exotropin. The Ingredient and the Moisturizer are hereinafter referred to as the “Combined Product”. The Supplier was obligated to deliver a purchase order for a minimum of $ 403,000 of the Combined Product by September 30, 2023 (“Initial Purchase Order”) and a total of $ 648,000 of the Combined Product during the first year of the Amended Skincare Agreement. During November 2023, the Supplier paid the Company $ 403,000 in connection with the Initial Purchase Order. Pursuant to Sales Agreement with Exotropin, the Company paid Exotropin $ 235,000 representing the amount of Initial Purchase Order associated with the Company’s arrangement with Exotropin to supply the Moisturizer (“Moisturizer Prepayment”). F- 29 On August 12, 2024, in connection with the mutual agreement to terminate the Amended Skincare Agreement, the Company and the Supplier entered into a settlement agreement and general release (“Settlement”). As of the date of the Settlement, both the Company and Exotropin had yet to deliver the Ingredient or the Moisturizer to the Supplier. In connection with the Settlement, the parties released each other from all outstanding duties and/or obligations owed by one party to the other party as set forth in the Settlement, including but not limited to the Company’s obligation to supply any Combined Product to the Supplier and the Supplier’s obligation to make or place any additional orders to the Company for the Combined Product. In connection with the Settlement, the Company retained the $403,000 payment that the Supplier made to the Company in connection with the Initial Purchase Order, and the Company was not obligated to deliver any of the Combined Product to the Supplier, including the portion of the Combined Product to be provided in connection with the Initial Purchase Order. Concurrent with the execution of the Settlement, the Company and Exotropin entered into a settlement and general release (“Release”) whereby the parties released each other from all outstanding duties and/or obligations owed by one party to the other party as set forth in the Release including but not limited to Exotropin’s obligation to supply any Moisturizer to the Company pursuant to the Amended Skincare Agreement and the Company’s obligation to make or place any additional orders to Exotropin for the Moisturizer. In connection with the Release, Exotropin retained the Moisturizer Prepayment that was paid by the Company of $235,000 in November 2023, and Exotropin was not obligated to deliver any of the Moisturizer to the Company, including portion of the Moisturizer to be provided in connection with the Moisturizer Prepayment. As a result of the above settlements, the Company has recorded $ 168,000 of other income during the year ended October 31, 2024 in connection with the net settlement amount associated with the Amended Skincare Agreement. Deferred Revenue Amounts received by the Company for products that have yet to be delivered to the customers as of October 31, 2025 and October 31, 2024 are reflected in the Company’s balance sheet as deferred revenues and were comprised of the following: Schedule of deferred revenue October 31, 2025 October 31, 2024 Advances On Future Purchases Of Inventory $ 155,000 $ 608,000 Sales To Customers Not Yet Delivered 453,000 276,000 Total Deferred Revenue $ 598,000 $ 884,000 Legal Matters Albert Mitrani and Dr. Maria Ines Mitrani On June 7, 2023, the Company filed a four-count complaint with the Seventeenth Judicial Circuit in and for Broward County, Florida against Albert Mitrani and Dr. Maria Ines Mitrani, co-founders of the Company. Albert Mitrani was a former director and executive officer of the Company (most recently serving as Chief Executive Officer from September 2019 to July 2022 and as Executive Vice President of Sales from July 2022 until his termination in May 2023) and Dr. Mitrani is a former director and former executive officer of the Company (serving as Chief Science Officer from November 2016 until her termination in April 2023). The complaint alleges (i) breach of contract; (ii) breach of fiduciary duty; and (iii) tortious interference with business relationships; and seeks injunctive relief, in connection with, inter alia , non-solicitation and non-competition violations, misappropriation of Company materials and proprietary information resulting in unjust enrichment, causing detriment to business relationships and goodwill towards customers and physicians, self-dealing and misconduct afoul to the Company’s business interests as members of the Company’s board of directors, executive officers and minority equity interest holders—all causing irreparable harm to the Company. The complaint seeks injunctive relief, in addition to both compensatory and punitive damages. F- 30 Effective November 13, 2023, the Company entered into a settlement agreement with Albert Mitrani and Dr. Maria Ines Mitrani, pursuant to which it resolved various claims against the Mitranis, including those set forth in the previously reported Florida state action the Company had filed against the Mitranis. As part of the settlement, Albert Mitrani and Dr. Maria Ines Mitrani returned to the Company an aggregate of 1,164,742 shares of the Company’s common stock held by them respectively and the parties exchanged mutual releases. Consultants Effective August 5, 2024, the Company entered into a settlement agreement with a prior consultant of the Company, pursuant to which it resolved various claims that had been brought by the Company against the consultants. As part of the settlement, the consultants agreed to return to the Company 237,602 shares of ZEO common stock held by the consultants in exchange for a payment of $ 80,000 and the parties exchanged mutual releases. The shares were returned to the Company in October 2024 and were redeposited back into the Company’s treasury of authorized and unissued shares. Dr. Leider The Company’s employment agreement with Dr. Harry Leider, its former Chief Executive Officer (“Leider Employment Agreement”) had an initial term that ended May 31, 2024. The Leider Employment Agreement was not renewed and accordingly, the Employment Agreement expired and the employment of Dr. Leider by the Company ended on May 31, 2024. Effective August 12, 2024, the Company and Dr. Leider entered into a settlement agreement and general release whereby the Company agreed to pay Dr. Leider $40,000 in exchange for each party executing mutual releases in connection with the non-renewal of Dr. Leider’s employment agreement. Dr. Golub The Company’s employment agreement Dr. Howard Golub, its former Chief Science Officer (“Golub Employment Agreement”) had an initial term that ended May 31, 2024. The Golub Employment Agreement was not renewed and accordingly, the Golub Employment Agreement expired and the employment of Dr. Golub by the Company ended on May 31, 2024. On November 19, 2024, Dr. Golub (“Plaintiff”), filed a complaint in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida against the Company, alleging a breach of contract as a result of the Company’s failure to pay Plaintiff severance in the amount of $150,000 in connection with the non-renewal of Golub Employment Agreement. Plaintiff is demanding judgment in the amount of $ 150,000 plus interest and attorney’s fees. The Company is currently exploring its legal options and intends to vigorously defend against the lawsuit. Exotropin On August 15, 2025, the Company terminated the Sales Agreement for cause. Exotropin filed a complaint (case No. CACE-25-013178, in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida) against the Company for declaratory judgment on August 29, 2025, concerning the parties’ June 19, 2024, Amended and Restated Sales Representative Agreement, seeking declarations related to termination and the survival/enforceability of certain restrictive and other clauses. On November 6, 2025, the Company moved to dismiss Exotropin’s complaint and to strike the jury demand pursuant to the agreement’s jury waiver. The Company filed counterclaims on November 17, 2025, alleging, among other things, unjust enrichment tied to diverted sales, tortious interference with business relationships, and seeking imposition of a constructive trust, as well as recovery of attorneys’ fees and costs, with rights reserved to amend and supplement. On January 7, 2026, Exotropin filed a First Amended Complaint adding claims for breach of contract and breach of fiduciary duty and seeking injunctive and monetary relief. Pleadings and motion practice remain in progress. Discovery is ongoing; no depositions have been taken to date. The Company denies Exotropin’s allegations and disputes Exotropin’s entitlement to any relief. The Company continues to evaluate its legal options and intends to protect its rights under the Sales Agreement. F- 31 BioXtex In June 2025, BioXtek sought to terminate the Binding MOU and the Joint Venture for alleged breaches by the Company, which the Company contested. As the Company and BioXtek were not able to amicably resolve the dispute, on December 17, 2025, the Company commenced an action against BioXtek (case No. CACE-25-019364, in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida) and an amended complaint on January 5, 2026, asserting claims for breach of contract and implied covenant, fraudulent inducement, violation of the Florida Deceptive Unfair Trade Practices Act, equitable accounting, and declaratory judgment. The Company seeks damages expectancy/consequential losses, equitable relief, and fees. The Clerk of the Court issued a Summons for BioXtek, but BioXtek has not been served with the Summons and Amended Complaint. Therefore, BioXtek’s response to the Amended Complaint is not yet due. The case is pending. The Company continues to evaluate its legal options and intends to protect its rights under the Binding MOU and the Joint Venture. Other In addition to the foregoing, from time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in any such matter may harm our business. NOTE 15 – OTHER INCOME Schedule of other Income Year Ended October 31, 2025 2024 Other income (expense) Gain on write-off of advances payable to former officer and settlement on outstanding payables (see Note 8) $ - $ 221,000 Gain, net of obligations in connection with termination of supply agreement (see Note 14) - 168,000 Resolution and settlement of long outstanding payables 19,000 176,000 Commissions on sales of Exotropin products 61,000 87,000 Proceeds from insurance claim - 89,000 Other 21,000 10,000 Total $ 101,000 $ 751,000 NOTE 16 – ACQUISITION OF BIOLUMINA ASSETS On June 25, 2025 (“Closing Date”), the Company entered into a stock purchase agreement with BioLumina, LLC (“BIO”), a Delaware limited liability company, and all of its members (each a “Member” and collectively “Members”), whereby the Company acquired all of the outstanding membership interests of BIO (“Acquisition”) held by the Members for a total purchase price of $ 200,000 (“Purchase Price”). The assets of BIO at the time of the Acquisition consisted primarily of finished goods inventory valued at $200,000 (“Inventory”) of which $23,000 was on hand and the remaining $177,000 (reflected as prepaid expenses in the unaudited balance sheet at July 31, 2025) is to be delivered by October 31, 2025, certain intellectual property consisting of various trademarks applications that have been submitted and are pending review and approval, and certain software platforms used to process product sales orders. At the time of the Acquisition, BIO’s historical cumulative sales were less than $50,000. The Company treated the purchase of BIO as an acquisition of assets. The Company did not assign any value to the intellectual property. Inventory was valued at the lower of replacement cost or the portion of the Purchase Price allocated towards inventory. F- 32 The Purchase Price is to be paid as follows: (a) A $25,000 cash payment (the “Cash Purchase Price”), paid on the Closing Date to the Members pro rata ; and (b) 30,000 restricted shares of the Company’s common stock valued at $ 75,000 (the “Zeo Shares”) issued on the Closing Date, to the Members, pro rata ; with respect to which the Members will be accorded (1) piggyback registration rights under the Securities Act of 1933, as amended and (2) a right to put their Zeo Shares back to the Company on the first anniversary of Closing (the “True Up Date”) at a price of $2.50 per share ($75,000 in the aggregate); and (c) A royalty, payable to the Members, pro rata , equal to 10% of the gross cash proceeds (excluding shipping, handling, returns and credits) received by the Company from the sale of BIO’s Inventory acquired at closing (the “Product”) during the first year following the Closing Date, up to a maximum of $100,000 (the “Royalty”) which Royalty will be payable to the Members, pro rata , within 5 business days of the True-Up Date. In the event the Royalty amount as of the True-Up Date is less than $100,000 (a “Shortfall”), then the Company agrees to pay the Members, pro rata , a cash payment in the amount of the Shortfall within 90 days after the True-Up Date. In addition, the Members shall have the option, to apply their pro rata share of the Royalty (inclusive of any Shortfall), to the purchase of additional restricted shares of the Company’s common stock at purchase price equal to 75% of the average closing trading price of the common stock for the 5 trading days immediately prior to the True-Up Date, provided however that in no event shall the purchase price be lower than $2.50 per Share. In connection with the Acquisition, the Company recorded an obligation of $16,500 representing the difference in the fair value of the ZEO Shares on the Closing Date ($58,500) and the amount that the Company has agreed to provide in the event of a Shortfall. At October 31, 2025, the Company recorded an additional obligation of $ 2,000 to reflect the loss in the fair value of the ZEO Shares from the Closing Date. NOTE 17 – SEGMENT INFORMATION Under ASC 280, Segment Reporting, operating segments are defined as components of an enterprise where discrete financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and in assessing performance. The Company operates and manages its business as one reportable and operating segment. The measure of segment assets is reported on the balance sheet as total assets. The Company’s Chief Executive Officer, who is also the CODM reviews financial information presented and decides how to allocate resources based on net income (loss). Net income (loss) is used for evaluating financial performance. Significant segment expenses include research and development, salaries, insurance, and stock-based compensation. Operating expenses include all remaining costs necessary to operate our business, which primarily include external professional services and other administrative expenses. The following table presents the significant segment expenses and other segment items regularly reviewed by our CODM for the years ended October 31, 2025 and 2024. Schedule of significant segment expenses Years ended October 31, 2025 2024 Revenue $ 5,199,000 $ 4,620,000 Cost of goods sold ( 931,000 ) ( 844,000 ) Salaries & consulting fees ( 2,956,000 ) ( 3,034,000 ) Professional fees ( 575,000 ) ( 497,000 ) Stock based compensation ( 4,693,000 ) ( 3,853,000 ) Lab expenses ( 387,000 ) ( 208,000 ) Research & development ( 100,000 ) ( 164,000 ) Commissions ( 521,000 ) ( 734,000 ) Marketing ( 139,000 ) ( 249,000 ) Office expenses & other ( 282,000 ) ( 355,000 ) Other income (expenses), net ( 136,000 ) 613,000 Net loss $ ( 5,521,000 ) $ ( 4,705,000 ) F- 33 NOTE 18 – SUBSEQUENT EVENTS Private Offering – Common Stock and Warrants From November 2025 to January 2026, the Company sold 4.8 Units to 8 investors for an aggregate purchase price of $ 1,200,000 in a private transaction pursuant to the exemption from registration afforded by Section 4(a)(2) of Rule 506(b) of Regulation D under the Securities Act of 1933, as amended. Each Unit consists of (i) 62,500 shares of common stock and (ii) warrants to purchase 62,500 shares of common stock of the Company at an exercise price of $4.00 until November 30, 2030. The warrants may be exercised on a cashless basis. In connection with the sale of the Units, the Company issued 300,000 shares of common stock and 300,000 warrants to purchase shares of common stock. Common Stock and Warrant Awards On January 14, 2026, pursuant to the Company’s 2021 Incentive Stock Plan (“Incentive Plan”), the Company’s Compensation Committee (“Comp Board”) awarded 175,000 shares of Zeo common stock to Ian Bothwell, the Company’s Chief Executive Officer and 175,000 shares of the Company’s common stock to Dr. George Shapiro, the Company’s Chief Medical Officer. In addition, pursuant to the Incentive Plan, the Comp Committee approved the granting of options to certain employees to purchase 42,500 shares of its common stock. The options exercise price is $ 2.66 per share, the trading price of the Company’s common stock on the date of the grant, vest on the one-year anniversary of the grant, and expire five years from the date of grant. The Comp Board also approved the grant of 175,000 shares of common stock of the Company to Greyt Ventures LLC, a principal shareholder of the Company in consideration of consulting services rendered to the Company. F- 34 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.