AIxCrypto Holdings, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 —BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

Corporate History

Ritter Pharmaceuticals, Inc. (the Company’s predecessor) was formed as a Nevada limited liability company on March 29, 2004 under the name Ritter Natural Sciences, LLC. In September 2008, this company converted into a Delaware corporation under the name Ritter Pharmaceuticals, Inc. On May 22, 2020, upon completing a “reverse recapitalization” transaction with Qualigen, Inc., Ritter Pharmaceuticals, Inc. was renamed Qualigen Therapeutics, Inc. (the “Company”). Qualisys Diagnostics, Inc. was formed as a Minnesota corporation in 1996, reincorporated to become a Delaware corporation in 1999, and then changed its name to Qualigen, Inc. in 2000. Qualigen, Inc. was a wholly-owned subsidiary of the Company. On July 20, 2023, the Company sold all of the issued and outstanding shares of common stock of Qualigen, Inc. to Chembio Diagnostics, Inc. (“Chembio”), a wholly-owned subsidiary of Biosynex, S.A. (“Biosynex”). Following the consummation of this transaction, Qualigen, Inc. became a wholly-owned subsidiary of Chembio.

In 2022, the Company acquired a 52.8% interest in NanoSynex, Ltd. (“NanoSynex”). In 2023, the Company entered into an Amendment and Settlement Agreement with NanoSynex (the “NanoSynex Amendment”), which resulted in the Company losing its controlling interest in NanoSynex.

In September 2025 the Company consummated a Subscription Agreement (the “Subscription Agreement”) with certain investors including Faraday Future Intelligent Electric Inc. (NASDAQ: FFAI) (the “ Company’s majority stockholder” or “Faraday” or “FFAI”) pursuant to which the investors purchased $40.7 million (the “Offering”) of the Company’s common stock and shares of a newly created Series B Convertible Preferred Stock, par value $0.001 per share (the “Series B Preferred Stock”) (see Note 14 - Stockholders’ Equity). This offering resulted in $37.7 million in net proceeds after $3.0 million in issuance costs were deducted. Up to $6.8 million of the net proceeds from the Offering were used to pay existing debt and fund the Company’s existing business operations, and the balance of the cash proceeds and contributed currency will be used for the execution of the Company’s cryptocurrency treasury strategy.

In January 2026, the Company formed three new wholly owned Delaware subsidiaries: AIxCrypto Token Labs US, Inc., AIxCrypto EAI, Inc., and AIxCrypto C10 ETF, Inc. These entities were formed to provide potential future organizational flexibility. As of June 30, 2026, these subsidiaries have not commenced operations, hold no material assets, and have not been capitalized.

In February 2026, the Company’s board of directors approved a strategic realignment to concentrate exclusively on its Real-World Asset (“RWA”) tokenization and Embodied Artificial Intelligence (“EAI”) ecosystem, discontinuing development of the BesTrade DeAI Agent platform and C10 digital asset portfolio management tools. At that time, management continued to evaluate strategic alternatives for its remaining legacy therapeutic programs, including potential out-licensing or asset sale.

On May 21, 2026, following a comprehensive strategic review, the Board formally approved the discontinuation and structured wind-down of the Company’s entire legacy biotechnology business segment, marking the full termination of all historical biopharmaceutical and therapeutic operations SEC. The Company is currently evaluating the financial impact of the wind-down, including expected asset impairment charges, closure costs and other related expenses.

RoboShare launched at Automate 2026 as an on-demand robot sharing marketplace, with Los Angeles serving as the initial pilot market. The pilot is targeted to begin in August 2026, subject to operational readiness, execution, and applicable revenue-recognition requirements.

Basis of Presentation

Certain information or footnote disclosures normally included in financial statements prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results, and cash flows for the periods presented. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, which contains the audited financial statements and notes thereto. The financial information as of December 31, 2025 is derived from the audited financial statements presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. The interim results for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the year ending December 31, 2026 or for any future periods.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In general, the functional currency of the Company is the U.S. dollar. There were no foreign currency transactions in the three and six months ended June 30, 2026 and 2025.

Accounting Estimates

Management uses estimates and assumptions in preparing its consolidated financial statements in accordance with U.S. GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. The Company’s estimates relate to the estimated fair value of convertible debt, warrant liabilities, and determination of the allowance for credit losses. Actual results could vary from the estimates that were used.

Related Parties and Related Party Transactions

A related party is a person who has the ability to exert significant influence over the Company and may include executive officers and directors, including members of their immediate families, shareholders owning more than 10% of the Company’s voting securities, or other entities deemed to be affiliates, as defined in ASC 850, Related Party Disclosures. The Company assesses its related parties and applicable disclosures on a quarterly basis, considering all relevant facts and circumstances.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an initial maturity of 90 days or less and money market funds to be cash equivalents.

The Company maintains the majority of its cash in accounts at banking institutions in the U.S. that are of high quality. Cash held in these accounts often exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. If such banking institutions were to fail, the Company could lose all or a portion of amounts held in excess of such insurance limitations. As of June 30, 2026, the Company had not experienced losses on these accounts, and management believes the Company is not exposed to significant risk on such accounts.

Digital Assets

The Company accounts for its digital assets in accordance with ASC 350, Intangibles—Goodwill and Other, as amended by ASU 2023-08, Accounting for and Disclosure of Crypto Assets. The Company adopted ASU 2023-08 effective January 1, 2025. Digital assets held by the Company, including Bitcoin, Cardano, Chainlink, Ethereum, Native BNB, Ripple, Solana, Tether (“USDT”), and Tron, meet the scope criteria of ASU 2023-08 and are recognized as indefinite-lived intangible assets. These assets are initially recorded at cost, including transaction fees, upon obtaining control of the asset, and are measured subsequently at fair value with changes in value recognized in net income or loss. The Company uses a FIFO methodology to assign costs to digital assets for purposes of the digital assets held and realized gains and losses disclosures. Purchases and sales of digital assets that are not revenue arrangements are classified on the statement of cash flows as investing activities. Net loss on digital assets are adjusted in operating activities in the statement of cash flows.

Software Capitalization

The Company accounts for the costs incurred in developing its product offerings under ASC 350-40,Internal-Use Software.

In accordance with the guidance in ASC 350-40, the Company will capitalize costs incurred in connection with the development of the Company’s product offerings during the application development stage. Costs incurred during the preliminary project and post-implementation stages are expensed as incurred. Costs incurred in connection with maintenance activities, including training or bug fixes are also expensed as incurred. The Company stops capitalizing qualifying costs once development activities are completed and the project is ready for its intended use.

Capitalized software costs will be amortized on a straight-line basis over a 36-month useful life beginning on the date when the product is ready for its intended use. Management will subsequently test the capitalized software costs for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable in accordance with ASC 360.

Derivative Financial Instruments and Warrant Liabilities

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the unaudited condensed consolidated statements of operations and comprehensive loss. Depending on the features of the derivative financial instrument, the Company uses either the Black-Scholes option-pricing model or a Monte-Carlo simulation to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period (See Note 8 – Warrant Liabilities).

Fair Value Measurements

The Company determines the fair value measurements of applicable assets and liabilities based on a three-tier fair value hierarchy established by accounting guidance and prioritizes the inputs used in measuring fair value. The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows:

Fair Value of Financial Instruments

Cash, prepaid expenses, and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. Short-term notes receivable are valued subject to a current expected credit loss (“CECL”) model (see Note 6 - Short-Term Notes Receivable).

The value of the Company’s warrant liabilities as of June 30, 2026 and December 31, 2025 was determined using the Black-Scholes Model. Significant assumptions used in the valuation include the expected volatility of the Company’s common stock, the contractual term of the warrants, the risk-free interest rate, and an expected dividend yield of zero. Expected volatility is based on a blend of comparable public company data and, as available, the Company’s own historical volatility. The risk-free rate is derived from U.S. Treasury yields with maturities commensurate with the remaining contractual term of the warrants. Fair value measurements associated with the liability-classified warrants represent Level 3 valuations under the fair value hierarchy.

The Company from time to time elects the fair value option to account for certain debt liabilities. Electing the fair value option allows the Company to initially and subsequently measure such liabilities at fair value rather than amortized cost and may be applied to debt liabilities that contain conversion or other features that would otherwise require bifurcation and mark to market accounting. Such debt liabilities will initially be measured using valuation techniques appropriate to the terms and expected life of the note. The Company expects to use level 3 input to measure the fair value in subsequent periods.

Parent Company Equity Held at Cost

The Company maintains an entrusted investment arrangement with Gold King Arthur Holding Limited (“GKA”), an independent third-party fiduciary, pursuant to which GKA acquires, holds and manages equity securities of the Company’s majority stockholder, FFAI, for the Company’s economic benefit. Consistent with EITF Issue No. 98-2 and based on the parent-directed nature of the arrangement, the Company has elected an accounting policy to present its indirect investment in FFAI equity securities, including FFAI’s common stock, preferred stock and warrants, as parent company equity held at cost, a contra-equity account classified within stockholders’ equity and accounted for analogously to treasury stock at historical cost, with no subsequent remeasurement for fair value changes recognized in the condensed consolidated statements of operations; warrants issued in connection with the investment are an integral component of the integrated parent-directed transaction and do not represent a separate unit of account, so no portion of the aggregate subscription proceeds is allocated to the warrants and no separate warrant asset or liability is recognized, and any gain or loss upon future disposition, conversion or settlement of the underlying securities is recognized in the condensed consolidated statements of operations upon disposition.

Sales and Marketing

Sales and marketing expenses are expensed as incurred and primarily consist of direct costs associated with branding, promotional, co-creation, and publicity activities. The Company’s marketing initiatives focus on increasing brand awareness for its real-world asset tokenization and embodied AI Infrastructure activities. For the six months ending June 30 2026 and 2025, the Company’s sales and marketing expenses were $723,937 and $0, respectively.

Stock-Based Compensation

Stock-based compensation cost for equity awards granted to employees and non-employees is measured at the grant date based on the calculated fair value of the award using the Black-Scholes option-pricing model, and is recognized as an expense, under the straight-line method, over the requisite service period (generally the vesting period of the equity grant). If the Company determines that other methods are more reasonable, or other methods for calculating these assumptions are prescribed by regulators, the fair value calculated for the Company’s stock options could change significantly. Higher volatility, lower risk-free interest rates, and longer expected lives would result in an increase to stock-based compensation expense to employees and non-employees determined at the date of grant.

Income Taxes

Deferred income taxes are recognized for temporary differences in the basis of assets and liabilities for financial statement and income tax reporting that arise due to net operating loss carry forwards, research and development credit carry forwards and from using different methods and periods to calculate depreciation and amortization, allowance for doubtful accounts, accrued vacation, research and development expenses, and state taxes. A provision has been made for income taxes due on taxable income and for the deferred taxes on the temporary differences. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Realization of the deferred income tax asset is dependent on generating sufficient taxable income in future years.

Recently Adopted Accounting Standards

There have been no recently adopted accounting pronouncements by the Company.

Recently Issued Accounting Standards Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, and in January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. The amendments require public business entities to disclose, for each relevant expense caption, specified natural expense categories, including purchases of inventory, employee compensation, depreciation and intangible asset amortization, as applicable, together with a qualitative description of remaining amounts. The amendments also require disclosure of the total amount of selling expenses and, in annual periods, the entity’s definition of selling expenses. The amendments are effective for the Company’s annual financial statements for the year ending December 31, 2027, and interim financial statements beginning with the first fiscal quarter of 2028, with early adoption permitted. The amendments are required to be applied prospectively, with retrospective application permitted. The Company is currently evaluating the impact of the amendments on its disclosures and related processes and controls.

In December 2025, the FASB issuedASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies interim disclosure requirements resulting in a comprehensive list of interim disclosures that are required by GAAP, and includes a disclosure principle that requires the disclosure of events since the end of the last annual reporting period that have a material impact on the Company. ASU 2025-11 is effective for the Company’s interim financial statements beginning with the first fiscal quarter of the year ended December 31, 2028, with early adoption permitted. ASU 2025-11 may be applied either prospectively or retrospectively. The Company is evaluating the disclosure requirements related to the new standard.

In December 2025, the FASB issued ASU 2025-12, Codification Improvements, which contains 33 narrow technical corrections, clarifications and editorial updates across multiple ASC Topics, including guidance for earnings per share, parent company equity held at cost, leases and financial instruments. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim periods within those fiscal years, with early adoption permitted. While most revisions are expected to have an immaterial impact on our condensed consolidated financial statements, the update includes clarifications to diluted EPS calculations for loss periods that will require retrospective application to prior comparative periods upon adoption. The Company is currently evaluating the full effect of this ASU but does not anticipate a material overall impact to its financial position, results of operations or disclosures.

The Company does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on our unaudited condensed consolidated financial statements or disclosures.

NOTE 2 —LIQUIDITY AND GOING CONCERN

The Company’s financial position remains weak. It has incurred recurring operating losses, with an accumulated deficit of $150.3 million as of June 30, 2026, and expects to continue incurring losses subsequent to the balance sheet date. Net cash used in operating activities was $7.9 million for the six months ended June 30, 2026 and $7.0 million for the year ended December 31, 2025.

As of June 30, 2026, the Company had approximately $0.6 million in cash and cash equivalents. In addition to cash and cash equivalents, the Company held exchange-traded digital assets with an aggregate carrying value of approximately $5.2 million. These exchange-traded digital assets may be monetized over time to support operations, but are subject to significant market price volatility and are not classified as cash equivalents.

Total current liabilities decreased toapproximately $1.7 million as of June 30, 2026 from approximately $3.3 million as of December 31, 2025. The balance consists of approximately $1.3 million in accounts payable — approximately $700,000 purportedly claimed by the University of Louisville Research Foundation, $140,000 to Faraday Futures, and $100,000 to FF Global Partners LLC, with the remainder relating to professional services and other vendors — plus approximately $0.2 million of related-party payables, approximately $129,000 of accrued expenses and other current liabilities, and approximately $67,000 in warrant liabilities. Total operating expenses declined to approximately $3.0 million for the three months ended June 30, 2026 from approximately $4.3 million in the first quarter of 2026, as management continues to execute cost normalization measures to preserve liquidity. The Company had no outstanding indebtness for borrowed money at June 30, 2026.

We expect to continue to have net losses and negative cash flow from operations, which will challenge our near-term liquidity. Our digital-asset treasury strategy and RoboShare operations are newly established, and there are no guarantees that either will generate revenue or provide sufficient liquidity. Notwithstanding the June 22, 2026 public launch of RoboShare, the Company has not yet generated operating revenue from the platform. Our nearest commercial milestone is the first RoboShare rental delivery, targeted for August 2026; the timing of delivery and associated revenue recognition remain subject to execution risk.

During the six months ended June 30, 2026, the Company fully repaid the remaining $132,000 principal balance of its convertible debt. There were no new financing activities during the three months ended June 30, 2026, and the Company issued no new common shares during the quarter.

Management’s plans to mitigate liquidity constraints include continued operating expense discipline, targeted monetization of digital asset holdings as needed, the planned commercialization of the Company’s physical AI activities through RoboShare, and prudent utilization of the equity purchase facility only upon satisfaction of all applicable conditions. Accordingly, the Company’s limited current cash balance, the absence of committed alternative financing, volatility in digital asset valuations, and the lack of recurring operating revenue collectively raise substantial doubt regarding our ability to continue as a going concern for the one-year period following the date that condensed consolidated financial statements were issued.

The accompanying financial statements have been prepared assuming that we will continue as a going concern. The financial statements do not include any adjustments that would be necessary should we be unable to continue as a going concern, and therefore be required to liquidate our assets and discharge our liabilities in other than the normal course of business and at amounts that may differ from those reflected in the accompanying financial statements.

NOTE 3 —DIGITAL ASSETS

As part of its strategic realignment completed in the fourth quarter of 2025, the Company began acquiring digital assets for investment purposes and for use within its programmable technology infrastructure platform.

The Company holds digital assets consisting of cryptocurrencies, stablecoins, and other blockchain-based tokens, as detailed below.

Significant Holdings

As of June 30,2026, the Company’s significant digital asset holdings consisted of the following:

Digital Asset Activity

The following table summarizes digital asset activity for the period indicated, including cost basis, fair value at the time of sale, realized and unrealized losses, and the fair value of outstanding digital assets as of June 30,2026,:

There were no digital assets held during the six months ended June 30, 2025.

The Company measures digital assets at fair value in accordance withASC 820, Fair Value Measurement.

Fair value is determined using quoted prices in active markets for identical assets (Level 1 inputs). The Company utilizes pricing information provided by the principal market, which is based on observable market prices from active trading exchanges.

NOTE 4 —FAIR VALUE MEASUREMENTS

Below is the summary of our assets and liabilities measured at fair value on a recurring basis and categorized using the fair value hierarchy as of June 30, 2026:

Below is the summary of our assets and liabilities measured at fair value on a recurring basis and categorized using the fair value hierarchy as of December 31, 2025:

NOTE 5 —PREPAID INVESTMENT, PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consisted of the following at June 30, 2026 and December 31, 2025:

NOTE 6 —SHORT-TERM NOTES RECEIVABLE

Short term notes receivable - consisted of the following at June 30, 2026 and December 31, 2025:

As of December 31, 2025, the Company had advanced an aggregate of $4,166,900 to Marizyme, Inc., against which Marizyme delivered demand promissory notes to the Company of like principal amounts (the “Marizyme Notes”). The Marizyme Notes bear at interest the rate of eighteen percent (18%) per annum. Marizyme may pre-pay all or any part of the outstanding principal or interest at any time and from time to time, in whole or in part, without premium or penalty. The total amortized cost consisting of principal and accrued interest was $4,898,060 as of December 31, 2025. For the six months ended June 30, 2026, interest income of $275,358 was recognized within other income in the unaudited condensed consolidated statement of operations.

Under ASC 326-20, known as the current expected credit loss (“CECL”) model, the Company was required to estimate credit losses expected over the life of an exposure (or pool of exposures) based on historical information, current information, and reasonable and supportable forecasts. The Company is unable to use its historical data to estimate losses as it has no relevant loss history to date. To determine the estimate of expected credit losses, the Company used a probability-weighted approach that incorporates multiple settlement scenarios, including recovery of amounts due upon an acquisition of the debtor, and recovery in different liquidation scenarios, and determines the expected recoverable amount of the loan in each scenario. This model requires management to make certain assumptions including the likelihood of each outcome, the estimated value of the debtor’s assets, and the Company’s expected claim and recovery rate on the debtor’s assets in the event of an insolvency or a liquidation proceeding. During the six months ended June 30, 2026, the Company recorded an additional allowance for credit losses of $142,574 and the total carrying value of the notes amounted to $475,844 prior to full settlement.

On May 12, 2026, the Company entered into a Note Purchase Agreement with CABG Acquisition Corp., pursuant to which the Company sold all of its right, title, and interest in certain loans and related creditor rights relating to Marizyme, Inc. In consideration, the Company received $100,000 in cash, contingent royalty rights, and a 4.99% membership interest in CABG SPV. CABG SPV is a dedicated New York limited liability company established solely by CABG to acquire and commercialize Marizyme’s operating assets and commercialize DuraGraft, from which AIxC receives a 4.99% minority membership interest and tiered royalty rights tied to product sales. The Company received a one-time cash settlement of $100,000 from Marizyme in full satisfaction of all outstanding principal and accrued interest under the Marizyme Notes and recognized a loss on settlement of short-term note receivable of $375,844, which was classified within loss on settlement of short-term note receivable on the unaudited condensed consolidated statements of operations for the six months ended June 30, 2026. The Company did not record any asset on its condensed consolidated balance sheet related to the royalty right or CABG SPV membership interest because royalties only activate after cumulative DuraGraft net revenue surpasses $20 million, the CABG SPV membership interest’s value depends on unproven commercialization, capital structure and dilution risks, and the Company no longer funds Marizyme’s biotech pipeline, making material future inflows highly unlikely under market-participant assumptions. No recurring impairment testing or third-party valuation assessments are required for these contingent upside interests, as their recoverable value is deemed zero at period end. Any royalty proceeds received in future periods will be recognized as other income upon actual cash receipt.

The Company is also party to a Co-Development Agreement with Marizyme, the divestiture of debt claims does not alter the Company’s contractual rights under the Co-Development Agreement, including its right to future royalty-style payments once the contractual sales and launch milestones are met. (see Note 13 - Research and License Agreements).

NOTE 7 —ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following at June 30, 2026 and December 31, 2025:

NOTE 8 –WARRANT LIABILITIES

On November 20, 2024, the Company closed its private placement transaction resulting in the issuance of newly designated Series A-2 Preferred Stock (see Note 14 – Stockholders Equity). As a result of the issuance of a new class of voting securities, the Company evaluated its equity classified warrants’ respective terms, and concluded that warrants for 68,712 common shares with a weighted average exercise price of $2.00 were required to be reclassified to liabilities, including pre-funded warrants with an exercise price of $0.05 per share. The pre-funded warrants are exercisable upon issuance and will remain exercisable until all the pre-funded warrants are exercised in full. At June 30, 2026 , pre-funded warrants for 51,199 common shares remained outstanding. During the six months ended June 30, 2026 and 2025 the Company recorded a gain on change in fair value of warrant liabilities of $74,625 and $55,199, respectively for these warrants. At June 30, 2026 and December 31, 2025, the fair value of these warrants was approximately $67,253 and $141,878, respectively.

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2026:

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2025:

The following table presents the Company’s fair value hierarchy for its warrant liabilities measured at fair value on a recurring basis as of June 30, 2026:

The following table presents the Company’s fair value hierarchy for its warrant liabilities measured at fair value on a recurring basis as of December 31, 2025:

There were no transfers of financial assets or liabilities between category levels for the six months ended June 30, 2026 or the year ended December 31, 2025.

The value of the warrant liabilities was based on valuations internally generated Black Scholes valuations. Due to the nominal exercise price of the 2024 Pre-Funded Warrants and indefinite term, the Company calculated an implied value of the 2024 Pre-Funded Warrants based on the underlying common stock price on the valuation date, less the exercise price. For volatility, the Company considers comparable public companies as a basis for its expected volatility to calculate the fair value of common stock warrants and transitions to its own volatility as the Company develops sufficient appropriate history as a public company. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected term of the common stock warrant. The Company uses an expected dividend yield of zero based on the fact that the Company has never paid cash dividends and does not expect to pay cash dividends in the foreseeable future. Any significant changes in the inputs may result in significantly higher or lower fair value measurements.

The following are the weighted average and the range of assumptions used in estimating the fair value of warrant liabilities (weighted average calculated based on the number of outstanding warrants on each issuance) as of June 30, 2026 and 2025:

NOTE 9 —CONVERTIBLE DEBT

2025 Convertible Note

On April 28, 2025, the Company entered into a Secured Convertible Note (the “2025 Convertible Note”) with Alpha Capital Anstalt (“Alpha”, or “Holder”), pursuant to which the Company issued to Alpha a non-interest-bearing note with a principal of $264,000, and an original issue discount (“OID”) of 20%, or $44,000, in exchange for $220,000 cash, less $20,000 in expenses. The Note is convertible at any time at Alpha’s option, into shares of the Company’s common stock at a price equal to $3.80 per share, subject to certain adjustments. The Convertible Note bears no interest, and the principal will be due on January 28, 2026 (the “Maturity Date”).

The Company determined the 2025 Convertible Note does not contain a substantial premium and therefore the Company elected to account for the Convertible Note under the fair value option in accordance with ASC 825-10-15-4. The Company determined the fair value of the Convertible Note was $311,943 at issuance. The difference between the $220,000 proceeds received and fair value was recorded as a loss upon issuance in the amount of $91,943. Issuance costs incurred in connection with the transaction were expensed immediately.

On June 4, 2025 the Company paid down $132,000 in principal at the request of Alpha, and on January 28, 2026 the remaining balance of $132,000 was paid. As of June 30, 2026, the remaining balance was zero, with a gain on the change in fair value of $10,236 recorded in the six months ended June 30, 2026. As of December 31, 2025 the Company reassessed the fair value of the 2025 Convertible Note at $142,236, with a gain on the change in fair value of $37,707 recorded in the year ended December 31, 2025.

NOTE 10 —PROMISSORY NOTES

During the year ended December 31, 2025, the Company issued short term notes payable totaling $4.4 million for total net proceeds of $3.4 million. Over the course of the year the Company repaid all notes for a total of $4.4 million, with the additional $1.0 million paid as a premium to some of the lenders and was recorded under interest expenses.

There were no outstanding promissory notes outstanding as of June 30, 2026 or December 31, 2025.

NOTE 11 —LOSS PER SHARE

Basic loss per share (“EPS”) is computed by dividing net loss including deemed dividends by the weighted-average number of common shares outstanding plus unexercised pre-funded warrants. Diluted EPS is computed based on the sum of the weighted-average number of common shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares consist of shares issuable from preferred stock, convertible debt, stock options and warrants.

These potentially dilutive securities have been excluded from diluted net loss per share as of June 30, 2026 and 2025 because their effect would be anti-dilutive:

NOTE 12 —COMMITMENTS AND CONTINGENCIES

On July 19, 2026, a special committee of the Board of Directors approved an initial advance of $250,000 to Faraday Future Intelligent Electric Inc. (“FFAI”), subject to execution of definitive documentation and satisfaction of specified conditions, which the Company funded on July 20, 2026. A second advance of $250,000 was funded on July 30, 2026 under the same approval. The advances bear interest at 10% per annum, with a default rate of 15% per annum, are unsecured, and rankpari passu with FFAI’s other unsecured indebtedness. Proceeds are restricted to funding a payment in connection with a sponsorship arrangement involving an affiliate of FFAI.

As of the date of these financial statements, $500,000 was outstanding and no definitive agreement has been executed because the Company and FFAI are negotiating an uncommitted, non-revolving delayed draw credit facility providing for advances of up to $2,000,000 in the aggregate, with each advance subject to separate approval by the special committee. The amounts already advanced would be subsumed within this credit facility. There can be no assurance that a definitive agreement will be executed or that its final terms will be consistent with those described above.

On July 29, 2026, the Company entered into a consulting agreement with Aibot US Operation Inc. (“Aibot”), effective July 16, 2026, pursuant to which Aibot will provide finance, capital markets, and human resources/legal coordination support services. The agreement has a one-year term ending July 15, 2027 and requires monthly consulting payments of $50,000, plus reimbursement of certain approved out-of-pocket expenses. The aggregate contractual commitment under the agreement is approximately $600,000 over the initial term, excluding reimbursable expenses.

NOTE 13 —RESEARCH AND LICENSE AGREEMENTS

UCL Business Limited

In January 2022, the Company entered into a License Agreement with UCL Business Limited (“UCLB”) to obtain an exclusive worldwide in-license of a genomic quadruplex (G4)-selective transcription inhibitor drug development program which had been developed at University College London, including lead and back-up compounds, preclinical data and a patent estate. (UCLB is the commercialization company for University College London.) The program’s lead compound is now being developed at the Company under the name QN-302 as a candidate for treatment for pancreatic ductal adenocarcinoma, which represents the vast majority of pancreatic cancers. The License Agreement required a $150,000 upfront payment, reimbursement of past patent prosecution expenses (approximately $160,000), and (if and when applicable) tiered royalty payments in the low to mid-single digits, clinical/regulatory/sales milestone payments and a percentage of any non-royalty sublicensing consideration paid to the Company.

On May 21, 2026, the Board of Directors approved the discontinuation and structured wind-down of the Company’s legacy biotechnology business segment following management’s evaluation of strategic alternatives for the segment, including a potential sale of the business. In connection with the wind-down of its legacy biotechnology business, the Company entered into a Deed of Termination and concurrent Assignment Agreement with UCLB, each effective July 9, 2026, pursuant to which: (i) the license agreement dated January 13, 2022, as amended, relating to G-Quadruplex binding molecules and the QN-302 program, was terminated in its entirety; and (ii) the Company assigned to UCLB all related intellectual property rights, including pre-clinical and clinical data, regulatory submissions, and the Investigational New Drug Application filed with the FDA, for a nominal consideration of £1.

There wereno license costs recorded related to this agreement during the six months ended June 30, 2026 and 2025.

QN-302 Phase 1 Study

In June 2023, the Company entered into a Master Clinical Research Services Agreement with Translational Drug Development, LLC (“TD2”) whereby TD2 agreed to perform certain clinical research and development services for the Company including but not limited to trial management, side identification and selection, site monitoring/management, medical monitoring, project management, data collection, statistical programming or analysis, quality assurance auditing, scientific and medical communications, regulatory affairs consulting and submissions, strategic consulting, and/or other related services. From time to time, the Company may enter into statements of work with TD2 for the performance of specific services under this Master Clinical Research Services Agreement.

In June 2023, the Company entered into a Master Laboratory Services Agreement with MLM Medical Labs, LLC (“MLM”) whereby MLM agreed to perform certain clinical research and development services for the Company including but not limited to laboratory, supply, testing, validation, data management, and storage services. From time to time, the Company may enter into work orders with MLM for the performance of specific services under this Master Laboratory Services Agreement.

In June 2023, the Company entered into a Master Services Agreement with Clinigen Clinical Supplies Management, Inc. (“Clinigen”) whereby Clinigen agreed to provide certain pharmaceutical products and/or services. From time to time, the Company may enter into statements of work with Clinigen for the performance of specific services under this Master Services Agreement.

In July 2023, pursuant to the above agreements, the Company entered into work orders and statements of work for clinical trial services for the conduct of the QN-302 Phase 1 study. Given our financial situation, the company slowed the development of the QN-302 Phase 1 Study beginning in the second quarter of 2024.

On May 21, 2026, the Board of Directors approved the discontinuation and structured wind-down of the Company’s legacy biotechnology business segment following management’s evaluation of strategic alternatives for the segment, including a potential sale of the business. The QN-302 Phase 1 study is included within the scope of this discontinued legacy biotechnology business wind-down, and no further developments related to this clinical program have occurred as of June 30, 2026.

Marizyme

On April 11, 2024, the Company entered into a Co-Development Agreement with Marizyme, Inc. (the “Co-Development Agreement”), which has subsequently been amended. Under the terms of the Co-Development Agreement, the Company committed to provide funding payments to Marizyme and pay a one-time exclusivity fee of $200,000. The $200,000 exclusivity fee and an initial $500,000 funding payment were remitted to Marizyme on April 12, 2024, and both amounts were recorded within research and development expenses on the unaudited condensed consolidated statements of operations and other comprehensive loss in the respective periods of payment. The exclusivity fee granted the Company an exclusive negotiating window through May 31, 2024 to negotiate a comprehensive strategic partnership covering Marizyme’s DuraGraft product line. The funding payments proceeds were intended to financially support the commercial rollout of Marizyme’s DuraGraft™ vascular conduit system, a device indicated for adult patients receiving coronary artery bypass graft surgery, used for flushing and preserving saphenous vein grafts for such procedures. In exchange for the funding contributions, the Company is entitled to quarterly revenue-based payments analogous to royalties equal to 33% of DuraGraft Net Sales (Net Sales defined consistently with gross profit derived from net product sales). The aggregate maximum amount of these royalty-like payments is capped at twice the total funding advanced by the Company. No royalty-like obligations accrue to Marizyme, and no payments to the Company are required, until two thresholds are satisfied: DuraGraft achieves commercial launch in the United States, and cumulative U.S. Net Sales of DuraGraft reach $500,000.

As of the June 30, 2026 and 2025, neither of the above triggering conditions had been satisfied, and no royalty-related payments were payable or receivable by the Company. Separately, in May 2026, the Company completed the sale and full assignment of all its outstanding loan and creditor interests in Marizyme pursuant to a Note Purchase Agreement dated May 12, 2026; this divestiture of debt claims does not alter the Company’s contractual rights under the Co-Development Agreement, including its right to future royalty-style payments once the contractual sales and launch milestones are met.

NOTE 14 —STOCKHOLDERS’ EQUITY

As of June 30, 2026 and 2025, the Company had two classes of authorized capital stock: common stock and preferred stock.

Common Stock

Holders of common stock generally vote as a class with the holders of the preferred stock and are entitled to one vote for each share held. Subject to the rights of the holders of the preferred stock to receive preferential dividends, the holders of common stock are entitled to receive dividends when and if declared by the Board of Directors. Following payment of the liquidation preference of the preferred stock, any remaining assets will be distributed ratably among the holders of the common stock and, on an as-if-converted basis, the holders of any preferred stock upon liquidation, dissolution or winding up of the affairs of the Company. The holders of common stock have no preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions.

At June 30, 2026 the Company has reserved 4,203,443 shares of authorized but unissued common stock for possible future issuance as follows:

Faraday Subscription Agreement

As described in Note 1 – Business and Summary of Significant Accounting Policies and Estimates, on September 29, 2025, the Company consummated the Subscription Agreement with certain investors, including Faraday pursuant to which the Company issued and sold 337,432 shares of the Company’s common stock and issued 100,000 to the Company’s legal firm . The purchase price of the common stock was $2.246 per share for an aggregate $0.8 million.

Additionally, in connection with the closing of the Subscription Agreement, the Company issued 60,257 shares of common stock as compensation to its advisor which has been accounted for under ASC 718Compensation—Stock Compensation(See Note 1 – Organization and Summary of Significant Accounting Policies and Estimates).

Further, in connection with the closing of the Subscription Agreement,1,087,266 warrants were issued to the placement agent, (the “Placement Agent Warrants”). The Placement Agent Warrants were immediately exercisable and have an initial exercise price of $2.47 per share. At June 30, 2026,1,087,266 Placement Agent Warrants remain outstanding.

2024 Common Stock Purchase Agreement

On November 19, 2024, the Company entered into a Common Stock Purchase Agreement (the “Common Stock Purchase Agreement”) with Horberg Enterprises LP (the “Investor”), pursuant to which the Company in its sole discretion has the right, but not the obligation, to issue and sell to the Investor up to $10.0 million of the Company’s common stock, from time to time beginning on the Commencement Date, as discussed below, subject to certain limitations and conditions detailed in the Common Stock Purchase Agreement. The Company is not obligated to sell any shares to the Investor under the Common Stock Purchase Agreement; sales and timing of any sales of the Company’s common stock are solely at the Company’s election. In accordance with the terms of the Common Stock Purchase Agreement, the Commencement Date is subject to certain conditions, including the effectiveness of a registration statement on Form S-1 or a similar prospectus permitting the Investor to offer and resell the shares of common stock acquired under the Common Stock Purchase Agreement.

No upfront fees were paid to the Investor at the execution of the arrangement. As of June 30, 2026, no registration statement had been filed and thus the Commencement Date permitting the sale of shares under the Common Stock Purchase Agreement had not yet occurred.

The Company evaluated the Common Stock Purchase Agreement under ASC 815-40Derivatives and Hedging-Contracts on an Entity’s Own Equity as it represents the right to require the Investor to purchase shares of Common Stock in the future, similar to a put option. The Company concluded the Common Stock Purchase Agreement represents a freestanding derivative instrument that does not qualify for equity classification and therefore requires fair value accounting. The Company analyzed the terms of the contract and concluded the derivative instrument had no value at inception, as of June 30, 2026, or as of December 31, 2025.

Preferred Stock

There are a total of 15,000,000 shares of Preferred Stock authorized, of which 7,000 shares are designated as Series A-2 Preferred Stock,10,000 shares are designed as Series A-3 Preferred Stock, and to 500,000 shares are designated as Series B Preferred Stock.

As described in Note 1 – Organization and Summary of Significant Accounting Policies and Estimates, on September 29, 2025, the Company consummated the Subscription Agreement pursuant to which the Company issued 39,943 shares of the newly designated Series B Preferred Stock, for $1,000 per share, for aggregate gross proceeds of approximately $39.9 million, before deducting placement agent fees and other offering expenses. This offering triggered a down-round provision of the Series A-2 Convertible Preferred Stock and Series A-3 Convertible Preferred Stock, as described further below, which resulted in a lower conversion price. As a result, the Company recorded a $2.0 million deemed dividend in the amount equal to the change in fair value of the abovementioned series of convertible preferred stock before and after the anti-dilution adjustment.

On July 28, 2025, in a private placement transaction, the Company sold and issued to certain institutional and accredited investors 4,500 shares of Series A-3 Convertible Preferred Stock, par value $0.001 per share, (the “Series A-3 Preferred Stock”), at a purchase price of $1,000 per share, for aggregate gross proceeds of approximately $4.5 million before deducting placement agent fees and offering expenses of $0.2 million, resulting in net proceeds of $4.3 million. This offering triggered a down-round provision of the Series A-2 Convertible Preferred stock, as described further below, which resulted in a lower conversion price. As a result, the Company recorded a $0.6 million deemed dividend in the amount equal to the change in fair value of the aforementioned series of convertible preferred stock before and after the anti-dilution adjustment.

On November 20, 2024 in a private placement transaction, the Company sold and issued to certain institutional and accredited investors 5,102 shares of the newly designated Series A-2 Convertible Preferred Stock, par value $0.001 per share (the “Series A-2 Preferred Stock” and together with the Series A-3 Preferred Stock, the “Series A Preferred Stock”), at a purchase price of $1,000 per share, for an aggregate purchase price of $5.1 million. The Company also entered into an Exchange Agreement with Yi Hua Chen on November 18, 2024, pursuant to which it issued 1,154 shares of Series A-2 Preferred Stock in full settlement of the outstanding balance of the 2024 Chen Debenture of approximately $1.15 million. During the year ended December 31, 2025,5,656 shares of Series A-2 Convertible Preferred stock and 4,500 shares of Series A-3 Convertible Preferred Stock were converted into 3,926,263 shares of common stock at a Conversion Price ranging from $3.64 to $2.246. During the six months ended June 30, 2026,33,858 shares of Series B Convertible Preferred Stock were converted into 15,074,610 shares of common stock at a Conversion Price of $2.246. At June 30, 2026, the Company’s outstanding preferred stock consists of the following:

The shares of Series A-2 Preferred Stock, Series A-3 Preferred Stock, and Series B Preferred Stock have the rights, preferences, powers, restrictions and limitations as set forth below.

Conversion Rights – Each share of Preferred Stock is convertible at any time, at the option of the holder, into a number of shares of common stock equal to $1,000 (the “Stated Value”), divided by a conversion price initially equal to $3.64 for each share of Series A-2 Preferred Stock, $2.80 for each share of Series A-3 Preferred stock and $2.246 for each share of Series B Preferred Stock (the “Conversion Shares”), subject to adjustment for any stock splits, stock dividends and similar events (the “Conversion Price”).

The Conversion Prices of the Series A Preferred Stock are also subject to down-round adjustments if the Company at any time while the Series A Preferred Stock is outstanding issues common stock or common stock equivalents at a lower effective price per share than the then-effective Conversion Price, in all cases subject to a floor price of $1.82 and $1.40 for the Series A-2 Preferred Stock and the Series A-3 Preferred Stock, respectively. Conversion of the Series A Preferred Stock will be prohibited if, as a result of such conversion, the holder, together with its affiliates, would beneficially own more than 4.99% (or 9.99% at the option of the holder) of the total number of shares of the Company’s common stock issued and outstanding.

Liquidation Preference – Upon any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, the holders of Series A Preferred Stock shall be entitled to an amount equal to the Stated Value for each share of Series A-2 Preferred Stock before any distribution or payment shall be made to the holders of common stock. Upon any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, the holders of Series B Preferred Stock shall be entitled to an amount equal to the Stated Value, plus any accrued and unpaid dividends thereon before any distribution or payment shall be made to the holders of common stock.

Voting Rights – The holders of Series A Preferred Stock are entitled to vote, together as a single class with the common stock, on all matters presented to the common stockholders for a vote. Each share of Preferred Stock is entitled to a number of votes equal to the number of shares into which such share of Preferred Stock would be convertible, as of the record date for determination of stockholders entitled to vote as to such matter, if the conversion price was equal to the “Minimum Price” (as defined in Nasdaq Listing Rule 5635(d)) as of the original issue date of the Series A Preferred Stock, taking into account for such purposes the beneficial ownership limitation as then in effect. The holders of Series B Preferred stock will vote together with common stock on an as-converted basis.

Dividends – The holders of Series A Preferred Stock and Series B Preferred Stock are entitled to receive dividends, if and when such dividends are paid to holders of common stock, in the same form and at the same time on an as-converted to common stock basis.

Protective Provisions – At all times while the Series A Preferred Stock and Series B Preferred Stock are outstanding, without the consent of the holders of at least 67% of the Stated Value of each series of the then-outstanding Series A Preferred Stock and holders of at least 75% of the Stated Value of the then-outstanding Series B Preferred Stock, (the “Required Consent”), the Company is prohibited from amending its charter documents in any manner that adversely affects the rights of the Series A Preferred Stock and Series B Preferred Stock, repurchase junior securities of the Company, pay cash dividends or distributions on junior securities of the Company, or enter into a material transactions with an affiliate of the Company (unless it is at arm’s length and expressly approved by a majority of the disinterested directors). Without the Required Consent of the Series B Preferred Stock, the Company is prohibited from entering into, creating, assuming or guaranteeing any new indebtedness or liens of any kind.

In addition, as long as any shares of Series B Preferred Stock are outstanding, the Company shall not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series B Preferred Stock directly and/or indirectly (a) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock or alter or amend this Certificate of Designation, (b) authorize or create any class of stock ranking as to redemption or distribution of assets upon a Liquidation (as defined in Section 5) senior to, or otherwise pari passu with, the Series B Preferred Stock or, authorize or create any class of stock ranking as to dividends senior to, or otherwise pari passu with, the Series B Preferred Stock, (c) amend its Articles of Incorporation or other charter documents in any manner that adversely affects any rights of the holders of the Series B Preferred Stock, (d) increase the number of authorized shares of Series B Preferred Stock, or (e) enter into any agreement with respect to any of the foregoing.

Upon any subsequent issuance by the Company or any of its subsidiaries of common stock or common stock equivalents for cash consideration, indebtedness or a combination of units thereof (a “Subsequent Financing”), holders of Series B Preferred Stock may elect, in its sole discretion, to exchange (in lieu of conversion), if applicable, all or some of the shares of Series B Preferred Stock then held for any securities or units issued in a Subsequent Financing on a $1.00 for $1.00 basis. Additionally, if in such Subsequent Financing there are any contractual provisions or side letters that provide terms more favorable to the investors than the terms previously provided to holders of the Series B Preferred Stock, holders of the Series B Preferred Stock shall become a part of the transaction documents, at their option.

Stock Options and Warrants

Stock Options

The Company recognizes all compensatory share-based payments as compensation expense over the service period, which is generally the vesting period.

In April 2020, the Company adopted the 2020 Stock Incentive Plan (the “2020 Plan”), which provides for the granting of incentive or non-statutory common stock options and other types of awards to qualified employees, officers, directors, consultants and other service providers.

In October 2025, the Company adopted the 2025 Equity Incentive Plan (the “2025 Plan”), which provides for the granting of incentive or non-statutory common stock options and other types of awards to qualified employees, officers, directors, consultants and other service providers. As of June 30, 2026, no awards were granted or outstanding under the 2025 Plan.

Equity Classified Compensatory Warrants

As part of the May 2020 reverse recapitalization transaction, the Company issued equity classified compensatory common stock warrants to an advisor and its designees. In addition, various service providers hold equity classified compensatory common stock warrants issued in 2017 and earlier (originally exercisable to purchase Series C convertible preferred stock, and now instead exercisable to purchase common stock). These are to be differentiated from the Series C Warrants described in Note 8 - Warrant Liabilities. As of June 30, 2026, warrants to purchase 107 shares of the Company’s common stock remain outstanding.

No new compensatory warrants were issued during the six months ended June 30, 2026 or 2025.

The following table summarizes the equity classified compensatory warrant activity for the six months ended June 30, 2026:

The following table summarizes the equity classified compensatory warrant activity for the six months ended June 30, 2025:

There were no compensation costs related to outstanding warrants for the six months ended June 30, 2026 and 2025. As of June 30, 2026 and 2025, there wasno unrecognized compensation cost related to nonvested warrants.

Noncompensatory Equity Classified Warrants

On December 22, 2022, in conjunction with the issuance of a debenture to Alpha (see Note 9 – Convertible Debt), the Company issued to Alpha a warrant to purchase 50,000 shares of the Company’s common stock. The exercise price of this warrant was initially $82.50, and may be exercised in whole or in part, on or after June 22, 2023 and at any time before June 22, 2028. On December 5, 2023, the Company entered into an Amendment No. 1 with regard to the related Securities Purchase Agreement, with Alpha. This Amendment reduced the Exercise Price of the December 22, 2022 warrant from $82.50 per share to $36.50 per share. The Amendment also revised certain provisions of the warrant which resulted in reclassification of the warrant from liabilities to equity during the year ended December 31, 2023. During the year ended December 31, 2024 this warrant was partially exercised for 31,998 shares, and as of June 30 2026 warrants to purchase 18,002 shares of the Company’s common stock remain outstanding.

On February 27, 2024 the Company entered into a new Securities Purchase Agreement with Alpha for the purchase of the February 2024 Debenture (see Note 9 – Convertible Debt). This Securities Purchase Agreement resulted in the reduction of the exercise price of the December 22, 2022 warrant and the May 2020 warrant from $36.50 per share to $13.00 per share. The company recognized a deemed dividend of $60,017, which represents the incremental fair value of the outstanding warrants as a result of the down-round provision. As the Company has an accumulated deficit, the deemed dividend was recorded as a reduction in additional paid-in capital, resulting in a net impact of zero to additional paid-in capital in the unaudited condensed consolidated statements of changes in stockholders’ equity. In addition, on February 27, 2024, the Company issued to Alpha a warrant to purchase 18,001 shares of the Company’s common stock at an exercise price of $13.00 per share, which may be exercised in whole or in part, at any time before February 27, 2029.

On September 6, 2024 as a result of the down-round provision triggered by shares sold in a public offering, the above warrants were repriced from $13.00 per share exercise price to $6.50 per share exercise price. The company recognized an additional deemed dividend of $27,587, which represents the incremental fair value of the outstanding warrants as a result of the down-round provision. As the Company has an accumulated deficit, the deemed dividend was recorded as a reduction in additional paid-in capital, resulting in a net impact of zero to additional paid-in capital in the unaudited consolidated statements of changes in stockholders’ equity.

On April 12, 2024, in connection with the issuance of a convertible debenture to Chen (see Note 9 – Convertible Debt), the Company issued a liability classified warrant to Chen to purchase 36,001 shares of common stock, exercisable until February 27, 2029. On September 6, 2024, as a result of a down-round provision triggered by shares sold in a public offering, the warrant was repriced from an exercise price of $13.00 per share to an exercise price of $6.50 per share. The warrant was initially liability classified due to an insufficient number of authorized shares to settle the warrant prior to the receipt of shareholder approval, which was subsequently obtained on October 25, 2024. As of that date, the Company determined that shareholder approval resulted in equity classification for the warrant and accordingly, the Company remeasured the warrant liability to fair value, and reclassified to noncompensatory equity classified warrants.

On September 6, 2024 as a result of the down-round provision triggered by shares sold in a public offering, the above warrants were repriced from $13.00 per share exercise price to $6.50 per share exercise price. The company recognized an additional deemed dividend of $27,587, which represents the incremental fair value of the outstanding warrants as a result of the down-round provision. As the Company has an accumulated deficit, the deemed dividend was recorded as a reduction in additional paid-in capital, resulting in a net impact of zero to additional paid-in capital.

As a result of a partial voluntary conversion of the 2024 Alpha Debenture on September 9, 2024, the Company no longer had sufficient shares to settle the 2024 Alpha Warrant in full until shareholder approval was obtained, and a portion (2,314 warrant shares with a fair value of $14,997) was reclassified to liabilities (see Note 8 – Warrant Liabilities). Shareholder approval was subsequently obtained on October 25, 2024, and as of that date, the Company determined that shareholder approval resulted in equity classification for the warrant again and, accordingly, the Company remeasured the warrant liability to fair value, and reclassified to noncompensatory equity classified warrants.

On September 6, 2024, upon the closing of a public offering, the Company issued pre-funded warrants to purchase 239,456 common shares at a price of $6.45 per share with an exercise price of $0.05 per share (the “pre-funded warrants”). The pre-funded warrants are exercisable upon issuance and will remain exercisable until all the pre-funded warrants are exercised in full. Pre-funded warrants for 188,257 common shares were exercised during the year ended December 31, 2024. At June 30, 2026 pre-funded warrants for 51,199 common shares remained outstanding.

On September 6, 2024, upon the closing of a public offering,16,019 warrants were issued to the placement agent. These warrants were not exercisable until March 5, 2025 and expire on September 6, 2029.

On November 20, 2024, the Company closed its private placement transaction resulting in the issuance of newly designated Series A-2 Preferred Stock. As a result of the issuance of a new class of voting securities, the Company evaluated its equity classified compensatory warrants’ respective terms, and concluded that compensatory warrants to purchase 1,353 common shares with a weighted average exercise price of $6.50 and a fair value of $904 were required to be reclassified to liabilities as of November 20, 2024.

On April 28, 2025 as a result of the down-round provision triggered by the issuance of the 2025 Convertible Note (see Note 9 - Convertible Debt), warrants for 54,002 common shares were repriced from $6.50 per share exercise price to $5.82 per share exercise price. The company recognized a deemed dividend of $1,586, which represents the incremental fair value of the outstanding warrants as a result of the down-round provision. As the Company has an accumulated deficit, the deemed dividend was recorded as a reduction in additional paid-in capital, resulting in a net impact of zero to additional paid-in capital in the unaudited condensed consolidated statements of changes in stockholders’ equity.

As discussed above, on September 29, 2025,1,087,266 Placement Agent Warrants were issued. The Placement Agent Warrants were immediately exercisable and have an initial exercise price of $2.47 per share. At June 30, 2026,1,087,266 Placement Agent Warrants remain outstanding.

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2026:

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2025:

NOTE 15 —PARENT COMPANY EQUITY HELD AT COST

In January 2026, the Company established an entrusted investment arrangement with GKA, acting as fiduciary, to indirectly acquire equity securities of FFAI, the Company’s majority stockholder. The transaction was completed through staged agreement executions and fund contributions, with final closing occurring on April 15, 2026.

On January 30, 2026, the Company entered into the initial entrusted investment agreement with GKA and remitted $10.0 million in initial prepaid investment funds, which were designated for subscription to FFAI equity securities. On April 10, 2026, the parties executed an amendment to the entrusted investment agreement, pursuant to which the Company advanced an additional $2.0 million in short-term bridge funding to FFAI through GKA, with interest accruing from the advance date through closing. At the April 15, 2026, closing, the $10.0 million initial prepaid principal, the $2.0 million additional bridge principal, and $2,192 of accrued bridge loan interest were collectively applied toward the $12,002,192 aggregate subscription amount under the amended and restated securities purchase agreement, in exchange for 1,926,337 shares of FFAI Class A common stock and 11,502 shares of FFAI Series C Convertible Preferred Stock. FFAI also issued GKA a four-year stock purchase warrant (“FFAI warrant”), which entitles the registered holder to acquire up to 1,000,000 shares of Class A common stock at an exercise price of $1.50 per share. The FFAI warrant becomes exercisable only after FFAI completes delivery of its 500th FX Super One vehicle, and is subject to the stated ownership and Nasdaq issuance limitations. Management evaluated the FFAI warrant and concluded that it does not represent a separately recognizable unit of account and that no portion of the aggregate subscription price is required to be allocated to the FFAI warrant, based on the FFAI warrant is held by GKA as fiduciary on behalf of AIxC as part of the entrusted investment and is an integral component of the parent-directed transaction accounted for as contra-equity.

As of June 30, 2026, the total carrying value of the Company’s indirect investment in FFAI’s common and preferred shares was $12,002,192. At closing, the Company recorded the full aggregate subscription amount into parent company equity held at cost, a contra-equity account measured at historical cost and no separate accounting entry is recorded for the FFAI warrant. This accounting treatment applies uniformly to both the FFAI Class A common stock and Series C Convertible Preferred Stock, with no subsequent fair value remeasurement recognized in the condensed consolidated financial statements as of June 30, 2026.

NOTE 16 —RELATED PARTY TRANSACTIONS

Lead Investor Agreement

In connection with the Subscription Agreement, the Company and Faraday Future Intelligent Electric Inc. entered into a Lead Investor Agreement. Pursuant to this agreement, Faraday committed to invest a minimum of $30 million in a Private Placement. The material terms of the Lead Investor Agreement include:

Actual proceeds from the Lead Investor Agreement from Faraday as well as several members of Faraday’s executive management team amounted to $34.2 million.

As part of the Lead Investor Agreement, YT Jia, the Global Chief Executive Officer of Faraday, contributed $4,000,000.

As part of the Lead Investor Agreement, Jerry Wang, the Global Executive Chairman of Faraday and Chief Executive Officer of AIXC, contributed $200,000.

There were no material changes to the Lead Investor Agreement during the three months ended June 30, 2026.

Transition Services Agreement

On September 30, 2025 the Company entered into a Transition Services Agreement with Faraday to provide support and management services. During the six months ended June 30, 2026, the Company was charged approximately $0.6 million in service fees under the Transition Services Agreement. The Company had a prepaid expense balance of $370,055 as of June 30, 2026.

The balance of charges dues under this agreement was $1.0 million as of December 31, 2025 and was classified under Related Party Payable on the consolidated balance sheet

Master Services Agreement

On June 3, 2026, the Company entered into a Master Services Agreement (“MSA”) with FFAI, a related party, pursuant to which the Company may provide consulting, advisory, operational, capital markets, technical, legal, and other support services to FFAI under separately executed statements of work. The MSA has an initial term of one year and automatically renews for successive one-year periods unless terminated in accordance with its terms. Compensation for services provided under the MSA is to be determined pursuant to individual statements of work and generally consists of reimbursement of direct personnel costs, allocated overhead, an 18% service fee, and certain direct expenses. No revenue was recognized under the MSA during the three and six months ended June 30, 2026.

Related Party Accrued Expenses

On October 2, 2025, the Company entered into an advisory agreement with Yueting (YT) Jia, a related party and significant stockholder, pursuant to which Mr. Jia serves as Chief Advisor. The agreement provides an annual advisory fee of $500,000, a target annual performance fee of $500,000, a one-time engagement fee of $300,000, and potential annual equity awards, subject to board approval and vesting conditions. The agreement has an initial term of three years. During the three and six months ended June 30, 2026, the Company recognized advisory service expenses under this agreement of $200,001 and $400,002, respectively, and had related-party payables of $116,667 as of June 30, 2026.

On January 28, 2026, the Company entered into a consulting services agreement with FF Global Partners LLC effective as of November 1, 2025, a related party, under which FF Global provides strategic planning, capital markets advisory, blockchain and technology consulting, and operational support services. The agreement expires on December 31, 2026 and provides for a monthly consulting fee of $100,000, performance-based bonuses at the discretion of the Company’s management and Board of Directors, and reimbursement of certain approved business expenses. During the three and six months ended June 30, 2026, the Company recorded related-party consulting expenses of $300,000 and $600,000, respectively. As of June 30, 2026, $100,000 was outstanding and was classified under related party payable.

Parent Equity Held at Cost

During the six months ended June 30, 2026, the Company invested an aggregate of approximately $12.0 million in FFAI through GKA. Upon closing on April 15, 2026, the aggregate subscription amount, including accrued interest, was converted into FFAI Class A common stock and Series C Convertible Preferred Stock. The Company recorded the full aggregate subscription amount of $12.0 million as parent company equity held at cost, which remained the carrying value of the investment as of June 30, 2026. See Note 15 for further details regarding the investment transaction and related accounting treatment.

Warrants

On May 22, 2020, as a commitment fee, the Company issued warrants to Alpha for the purchase of common stock. As of December 31, 2024, 141 of these warrants remained outstanding and exercisable, and were able to be exercised in whole or in part, at any time before May 22, 2025. These warrants expired, and as of December 31, 2025, none of these warrants remain outstanding and exercisable. During years ended December 31, 2025 and 2024 there wereno exercises of this warrant. This warrant was equity classified as of December 31, 2023 and was reclassified to warrant liabilities during the year ended December 31, 2024 (see Note 8 - Warrant Liabilities).

On December 22, 2022, in conjunction with the issuance of a debenture to Alpha, the Company issued to Alpha a warrant to purchase 50,000 shares of the Company’s common stock. This warrant may be exercised by Alpha, in whole or in part, on or after June 22, 2023 and at any time before June 22, 2028, subject to certain terms and conditions described in the warrant. During the year ended December 31, 2024, Alpha partially exercised this warrant to purchase 31,998 shares respectively, of the Company’s common stock at a weighted average exercise price of $13.00, for total cumulative proceeds to the Company of $416,000. During the year ended December 31, 2025, there were no exercises of this warrant. This warrant is included in equity on the Company’s unaudited condensed consolidated balance sheets (see Note 14 – Stockholders’ Equity ).

On February 27, 2024, in conjunction with the issuance of a debenture to Alpha, the Company issued to Alpha, a warrant to purchase 18,001 shares of the Company’s common stock, exercisable in whole or in part, until February 27, 2029, subject to certain terms and conditions described in the warrant. This warrant is presented on the balance sheet as an equity classified warrant.

On September 6, 2024 as a result of the down-round provision triggered by shares sold in a public offering, the above warrants were repriced from $13.00 per share exercise price to $6.50 per share exercise price. The company recognized an additional deemed dividend of $27,587, which represents the incremental fair value of the outstanding warrants as a result of the down-round provision. As the Company has an accumulated deficit, the deemed dividend was recorded as a reduction in additional paid-in capital, resulting in a net impact of zero to additional paid-in capital in the unaudited condensed consolidated statements of changes in stockholders’ equity. On April 28, 2025, as a result of the down-round provision triggered by the issuance of the 2025 Convertible Note, the warrant was repriced from an exercise price of $6.50 per share to an exercise price of $5.82 per share. No further down-round provisions were triggered by the July 28, 2025 private placement transaction or the Subscription Agreement as these warrants were at their contractual floor.

As a result of a partial voluntary conversion of the 2024 Alpha Debenture on September 9, 2024, the Company no longer had sufficient shares to settle the 2024 Alpha Warrant in full until shareholder approval was obtained, and a portion (2,314 warrant shares with a fair value of $14,997) was reclassified to liabilities (see Note 8 – Warrant Liabilities). Shareholder approval was subsequently obtained on October 25, 2024, and as of that date, the Company determined that shareholder approval resulted in equity classification for the warrant again and, accordingly, the Company remeasured the warrant liability to fair value, and reclassified to noncompensatory equity classified warrants.

During the three months ended June 30, 2026, there were no exercises of this warrant. This warrant is included in equity on the Company’s unaudited consolidated balance sheets (see Note 14 – Stockholders’ Equity).

As of June 30, 2026, the exercise price of the 2022 Alpha Warrant was $6.50 per share, while the exercise price of the 2024 Alpha Warrant was $5.82 per share.

On April 12, 2024, in connection with the issuance of a debenture to Chen (see Note 9 – Convertible Debt), the Company issued a liability classified warrant to Chen to purchase 36,001 shares of common stock, exercisable until February 27, 2029. On September 6, 2024, as a result of a down-round provision triggered by shares sold in a public offering, the warrant was repriced from an exercise price of $13.00 per share to an exercise price of $6.50 per share. The warrant was initially liability classified due to an insufficient number of authorized shares to settle the warrant prior to the receipt of shareholder approval, which was subsequently obtained on October 25, 2024. As of that date, the Company determined that shareholder approval resulted in equity classification for the warrant and accordingly, the Company remeasured the warrant liability to fair value, and reclassified to noncompensatory equity classified warrants (see Note 14 – Stockholders’ Equity). The fair value of this warrant was $565,582 on the issuance date and $185,531 on the date of reclassification to equity. On April 28, 2025, as a result of the down-round provision triggered by the issuance of the 2025 Convertible Note, the warrant was repriced from an exercise price of $6.50 per share to an exercise price of $5.82 per share. No further down-round provisions were triggered by the July 28, 2025 private placement transaction or the Subscription Agreement as these warrants were at their contractual floor.

NOTE 17 —SEGMENT INFORMATION

The Company operates as a single operating and reportable segment. This determination is consistent with the manner in which the Company’s Chief Operating Decision Maker (“CODM”) evaluates performance, allocates resources, and reviews financial results.

The CODM consists of the Company’s Chief Executive Officer and its Chief Financial Officer. The CODM reviews consolidated financial information and does not receive discrete financial information for separate business components. Prior to the Offering (see Note 1 – Organization and Summary of Significant Accounting Policies and Estimates), the CODM consisted of the sole Chief Executive Officer.

In accordance with ASC 280,Segment Reporting, the Company has concluded that it hasone operating and reportable segment because its financial results are reviewed on a consolidated basis and no component meets the definition of a separate operating segment.

The Company’s operations primarily consist of the development and commercialization of AI-enabled technology products and services, including AI-based trading tools, digital-asset tokenization and embedded AI services, and AI-powered cryptocurrency portfolio management solutions. Prior to the Offering, the Company was an early-stage clinical therapeutics company focused on developing treatments for adult and pediatric cancer.

On May 21, 2026, the Board of Directors approved the permanent discontinuation of the Company’s legacy biotechnology business. Prior to finalizing the wind-down plan, management comprehensively evaluated all reasonable strategic alternatives for the biotechnology operations, including a potential outright sale of the related business and intellectual property assets, and determined a staged internal wind-down is in the best long-term interests of the Company and its stockholders. Under ASC 205-20, the legacy biotechnology component fails to satisfy all six mandatory held-for-sale classification criteria as of June 30, 2026, and therefore does not qualify for separate discontinued operations presentation on the consolidated statements of operations. All costs, operating results, assets and liabilities associated with the ongoing wind-down of legacy biotechnology activities remain classified within continuing operations of the Company’s single reportable segment.

The CODM evaluates performance and allocates resources based on consolidated net income (loss). The CODM reviews the Company’s significant segment expenses, which are its consolidated operating expenses, including research and development, general and administrative, and interest and other expenses, broken out as follows:

The CODM evaluates the Company’s financial position based on the consolidated balance sheet and does not review segment-level asset information. Accordingly, no separate segment asset disclosures are presented.

NOTE 18 —SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date these financial statements were available to be issued. The Company is not aware of any other events requiring recognition or disclosure in these financial statements.

In connection with the wind-down of its legacy biotechnology business, the Company entered into a Deed of Termination and concurrent Assignment Agreement with UCL Business Limited (“UCLB”), each effective July 9, 2026, pursuant to which: (i) the license agreement dated January 13, 2022, as amended, relating to G-Quadruplex binding molecules and the QN-302 program, was terminated in its entirety; and (ii) the Company assigned to UCLB all related intellectual property rights, including pre-clinical and clinical data, regulatory submissions, and the Investigational New Drug Application filed with the FDA, for a nominal consideration of £1.

On July 19, 2026, a special committee of the Board of Directors approved an initial advance of $250,000 to Faraday Future Intelligent Electric Inc. (“FFAI”), subject to execution of definitive documentation and satisfaction of specified conditions, which the Company funded on July 20, 2026. A second advance of $250,000 was funded on July 30, 2026 under the same approval. The advances bear interest at 10% per annum, with a default rate of 15% per annum, are unsecured, and rank pari passu with FFAI’s other unsecured indebtedness. Proceeds are restricted to funding a payment in connection with a sponsorship arrangement involving an affiliate of FFAI.

As of the date of these financial statements, $500,000 was outstanding and no definitive agreement has been executed because the Company and FFAI are negotiating an uncommitted, non-revolving delayed draw credit facility providing for advances of up to $2,000,000 in the aggregate, with each advance subject to separate approval by the special committee. The amounts already advanced would be subsumed within this credit facility. There can be no assurance that a definitive agreement will be executed or that its final terms will be consistent with those described above.

On July 29, 2026, the Company entered into a consulting agreement with Aibot US Operation Inc. (“Aibot”), effective July 16, 2026, pursuant to which Aibot will provide business operations support services, including finance, capital markets, and human resources/legal coordination functions. The agreement has an initial one-year term ending July 15, 2027. In consideration of the services provided, the Company will pay Aibot a monthly consulting fee of $50,000.