BNB PLUS CORP.

Item 1 - Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

NOTE A — NATURE OF THE BUSINESS

BNB Plus Corp. (formerly Applied DNA Sciences, Inc.) (the “Company”) is a digital asset treasury (“DAT”) company that has adopted BNB, the native cryptocurrency of the Binance blockchain ecosystem as its primary reserve asset. By using proceeds from financings, as well as potential cashflow from the Company’s operations, the Company seeks to strategically accumulate BNB and utilize the accumulated BNB as a productive treasury asset to produce yield via Binance native and other decentralized (“DEFi”) finance opportunities (“BNB Strategy”).

In addition, via the Company’s LineaRx, Inc. subsidiary (“LineaRx”), it is commercializing proprietary nucleic acid production solutions for the biopharmaceutical and diagnostics markets. The Company’s nucleic acid production solutions enable cell-free manufacturing of deoxyribonucleic acid (“DNA”) and ribonucleic acid (“RNA”), which are essential components for a new generation of advanced biotherapeutics, such as gene therapies, adoptive cell therapies, messenger RNA therapeutics and DNA vaccines, as well as diagnostic applications.

Historically, the Company has operated intwo additional business markets: (i) the manufacture and detection of DNA for industrial supply chains and security services (“DNA Tagging and Security Products and Services”), which the Company is in the process of winding down; and (ii) the detection of DNA and RNA in molecular diagnostics and genetic testing services (“MDx Testing Services”), which the Company exited on June 30, 2025.

On September 16, 2002, the Company was incorporated under the laws of the State of Nevada. Effective December 2008, the Company reincorporated from the State of Nevada to the State of Delaware.

Company Restructuring and Stock Splits

On October 6, 2025, the Company’s Board of Directors authorized, and its officers implemented, a restructuring plan pursuant to which the Company reduced overall operating expenses to focus resources on its BNB Strategy. The restructuring plan included a reduction of the Company’s workforce by sixteen (16) employees, or approximately 60%. The Company incurred aggregate pre-tax charges in connection with the reduction-in-force, primarily consisting of severance payments, employee benefits, and related costs. The reduction-in-force was substantially completed by December 31, 2025 and associated charges of approximately $1.2 million were recorded in the quarter ended December 31, 2025 and approximately $138,000 is expected to be incurred during the second quarter of fiscal 2026.

On March 13, 2025, the Company filed with the Secretary of State of the State of Delaware a Certificate of Amendment of its Certificate of Incorporation that effected aone-for-fifty (1:50) reverse stock split of its common stock, effective at 12:01 a.m. Eastern Time on March 14, 2025 (the “March 2025 Reverse Split”). In addition, on June 1, 2025, the Company filed with the Secretary of State of the State of Delaware a Certificate of Amendment of its Certificate of Incorporation that effected aone-for-fifteen (1:15) reverse stock split of its common stock effective at 12:01 a.m. Eastern Time on June 2, 2025 (the “June 2025 Reverse Split”) (collectively the “2025 Reverse Splits”).

All warrant, option, share, and per share information in the Form 10-Q gives retroactive effect to the 2025 Reverse Splits.

NOTE B — BASIS OF PRESENTATION AND SUMMARY OF ACCOUNTING POLICIES

Interim Financial Statements

The accompanying condensed consolidated financial statements as of December 31, 2025, and for the three-months ended December 31, 2025, and 2024 are unaudited. These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and are presented in accordance with the requirements of Regulation S-X of the Securities and Exchange Commission (the “SEC”) and with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements.

Interim Financial Statements continued

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-months ended December 31, 2025 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2026. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the fiscal year ended September 30, 2025 and footnotes thereto included in the Annual Report on Form 10-K of the Company filed with the Securities and Exchange Commission (“SEC”) on December 22, 2025. The condensed consolidated balance sheet as of September 30, 2025 contained herein has been derived from the audited consolidated financial statements as of September 30, 2025 but does not include all disclosures required by GAAP.

Principles of Consolidation

The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, APDN (B.V.I.) Inc., Applied DNA Sciences India Private Limited (which currently has no operations), Applied DNA Clinical Labs, LLC (“ADCL”) (see Discontinued Operations below), Spindle Biotech, Inc., Applied DNA Sciences Europe Limited (which currently has no operations) and its majority-owned subsidiary, LineaRx, Inc. (“LRx”). Significant inter-company transactions and balances have been eliminated in consolidation.

On October 19, 2025, the Company formed Build & Build, LLC, a Delaware limited liability company and a 100% owned subsidiary of the Company (“Build & Build”), in connection with the Company’s BNB Strategy. Pursuant to its BNB Strategy, Build & Build is used to house certain of the cryptocurrency assets of the Company.

On November 26, 2025, the Company formed BNBX Ltd., a British Virgin Islands business company and a 100% owned subsidiary of the Company. Pursuant to the Company’s BNB Strategy, BNBX Ltd. will be used to house certain of the Company’s cryptocurrency assets.

Liquidity and Management’s Plan

The Company has recurring net losses, which have resulted in an accumulated deficit of $397,786,765 as of December 31, 2025. The Company incurred a net loss of $18,606,182 and incurred negative operating cash flow of $5,545,124 for the three-months ended December 31, 2025.

The Company’s current capital resources include cash and cash equivalents, cryptocurrency assets and investments. Historically, the Company has financed its operations principally from the sale of equity and equity-linked securities.

As discussed in Note G, during October 2025, the Company closed the Private Placement of its common stock and/or pre-funded warrants, Series E-1 Warrants, and Series E-2 Warrants. Upon the closing of the Private Placement, the Company received $24.9 million in net proceeds after deducting placement agent fees and offering costs (consisting of $7.6 million in cash, net of offering costs, $5.9 million in USDC and $11.4 million in OBNB Trust Units). The Company also received proceeds from warrants exercised of approximately $732 thousand during the three-months ended December 31, 2025.

The Company estimates that it will have sufficient cash and cash equivalents, as well as liquid cryptocurrency to fund operations for the next twelve months from the date of filing these financial statements. Our digital asset, as well as our investment in digital asset trust are considered longer-term investments (“Digital asset treasury”) and we do not believe we will need to sell our Digital asset treasury within the next twelve months to meet our working capital requirements, although we may from time to time sell or engage in other transactions with respect to our Digital asset treasury as part of our treasury management operations.

Discontinued Operations

The condensed consolidated financial statements separately report discontinued operations and the results of continuing operations (see Note K). All footnotes exclude discontinued operations unless otherwise noted.

Use of Estimates

The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. The most significant estimates include revenue recognition, recoverability of long-lived assets, including the values assigned to intangible assets, contingencies, and management’s anticipated liquidity. Management reviews its estimates on a regular basis and the effects of any material revisions are reflected in the condensed consolidated financial statements in the period they are deemed necessary. Accordingly, actual results could differ from those estimates.

Revenue Recognition

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codifications (“ASC”), Revenue Recognition (“ASC 606” or “Topic 606”).

The Company measures revenue at the amounts that reflect the consideration to which it is expected to be entitled in exchange for transferring control of goods and services to customers. The Company recognizes revenue either at the point in time or over the period of time that performance obligations to customers are satisfied. The Company’s contracts with customers may include multiple performance obligations (e.g. DNA products, maintenance, authentication services, research and development services, etc.). For such arrangements, the Company allocates revenues to each performance obligation based on their relative standalone selling price.

Due to the short-term nature of the Company’s current contracts with customers, it has elected to apply the practical expedients under Topic 606 to: (1) expense as incurred, incremental costs of obtaining a contract and (2) not adjust the consideration for the effects of a significant financing component for contracts with an original expected duration of one year or less.

Product Revenues

The Company’s DNA product revenues are accounted for/recognized in accordance with contracts with customers. The Company recognizes revenue upon satisfying its promises to transfer goods or services to customers under the terms of its contracts. These performance obligations are satisfied at the point in time the Company transfers control of the goods to the customer, which in nearly all cases is when title to and risk of loss of the goods transfer to the customer. The timing of transfer of title and risk of loss is dictated by customary or explicitly stated contract terms. The Company invoices customers upon shipment, and its collection terms range, on average, from 30 to 60 days.

Authentication Services

The Company recognizes revenue for authentication services upon satisfying its promises to provide services to customers under the terms of its contracts. These performance obligations are satisfied at the point in time the Company services are complete, which in nearly all cases is when the authentication report is released to the customer.

Research and Development Services

The Company’s revenues from its research and development contracts are accounted for/recognized when the performance obligations per the contract are satisfied. These performance obligations are satisfied at the point in time, either when the Company’s services are complete, or when the Company transfers control of the goods to the customer, which in nearly all cases is when title to and risk of loss of the goods transfer to the customer, or when a report is released to a customer. The timing of transfer of title and risk of loss is dictated by customary or explicitly stated contract terms. The Company invoices customers upon shipment, or completion of the services and its collection terms range, on average, from 30 to 60 days.

Revenue Recognition continued

Disaggregation of Revenue

The following table presents revenues disaggregated by our business operations and timing of revenue recognition:

Contract balances

As of December 31, 2025, the Company has entered into contracts with customers for which revenue has not yet been recognized. Consideration received from a customer prior to revenue recognition is recorded to a contract liability and is recognized as revenue when the Company satisfies the related performance obligations under the terms of the contract. The deferred revenue as of December 31, 2025 consists of authentication services under a contract where consideration has been received and the services have not been fully performed. The Company’s contract liabilities, which are reported as deferred revenue on the condensed consolidated balance sheet as of December 31, 2024, consisted almost entirely of research and development contracts where consideration has been received and the development services had not yet been performed, as well as authentication services under contracts where consideration had been received and the services had not been fully performed.

The opening and closing balances of the Company’s contract liability balances are as follows:

For the three-months ended December 31, 2025, the Company recognized$12,285 of revenue that was included in Contract liabilities as of October 1, 2025.

The opening and closing balances of the Company’s contract asset balances are as follows:

Cash, Cash Equivalents, and Restricted Cash

For the purpose of the accompanying condensed consolidated financial statements, all highly liquid investments with a maturity of three months or less from when purchased are considered to be cash equivalents. The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts shown in the statement of cash flows.

Inventories

Inventories, which consist primarily of raw materials, work in progress and finished goods, are stated at the lower of cost or net realizable value, with cost determined by using the first-in, first-out (FIFO) method.

Net Loss Per Share

The Company presents net loss per share utilizing a dual presentation of basic and diluted loss per share. Basic loss per share includes no dilution and has been calculated based upon the weighted average number of common shares outstanding during the period. Dilutive common stock equivalents consist of shares issuable upon the exercise of the Company’s stock options, restricted stock units and warrants.

As disclosed in Note G below, as part of the Private Placement Offering, the Company issued pre-funded warrants to purchase shares of common stock at an exercise price of $0.0001 per share. These warrants are exercisable and have no expiration date. As the exercise price is negligible and the warrants are exercisable for little or no cash consideration, the shares underlying the pre-funded warrants are considered outstanding and are included in the weighted-average number of shares used to calculate basic and diluted net loss per share for the three-months ended December 31, 2025.

The following table presents the calculation of weighted-average shares used in computing basic and diluted net loss per share for the three-months ended:

Securities that could potentially dilute basic net loss per share in the future that were not included in the computation of diluted net loss per share because to do so would have been anti-dilutive for the three-month periods ended December 31, 2025 and 2024 are as follows:

Digital Assets

In December 2023, the FASB issued ASU 2023-08, Digital Assets, which provides guidance on the recognition, measurement, presentation, and disclosure of digital assets through the creation of ASC 350-60 – Intangibles – Goodwill and Other – Crypto Assets. ASU 2023-08 became effective for all entities for fiscal years beginning after December 15, 2024. The Company accounts for its digital assets, including BNB tokens, in accordance with ASC 350 – Intangibles – Goodwill and Other. The Company has determined its digital assets meet the scoping criteria of ASC 350-60, which requires eligible crypto assets to be measured at fair value, with changes in fair value recognized in net income. Fair value is determined in accordance with ASC 820 – Fair Value Measurement, using quoted prices in active markets. The Company has designated a principal market based on the market that the Company has access to and has the greatest volume and level of activity of BNB for determining the fair value of BNB tokens.

The Company deposits certain digital assets with a third-party exchange to facilitate trading activities. Assets held on this exchange are maintained in accounts under the Company’s exclusive control. The activity from remeasurement of digital assets at fair value is reflected in the condensed consolidated statements of operations within gain/loss from fair value measurement of digital assets. Realized gains and losses from the derecognition of digital assets would be included in the realized gain/loss on digital assets in the condensed consolidated statements of operations. Although the Company has not disposed of any digital assets during the reporting period, in the event there are disposals in the future, the Company will use the specific identification method to calculate the realized gains/losses on digital assets.

Sales and purchases of digital assets are reflected as cash flows from investing activities in the condensed consolidated statements of cash flows.

Investment in Digital Asset Trust

The Company currently holds units of OBNB Osprey BNB Chain Trust (the “OBNB Trust Units”), as detailed more in Note G. The OBNB Trust Units are publicly traded and have readily determinable fair value as defined in ASC 321-10-20. Accordingly, the Company measures the OBNB Trust Units at fair value with changes in fair value recognized in earning in the period of change.

Concentrations

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and trade receivables. The Company places its cash and cash equivalents with high credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit. As of December 31, 2025, the Company had cash and cash equivalents of approximately $2.6 million in excess of the FDIC insurance limit.

The Company’s revenues earned from sale of products and services for the three-month period ended December 31, 2025 included an aggregate of 69% fromone customer within the Therapeutic DNA Production Services segment and an aggregate of 13% fromone customer within the DNA Tagging and Security Products and Services segment.

The Company’s revenues earned from sale of products and services for the three-month period ended December 31, 2024 included an aggregate of 57% fromtwo customers within the DNA Tagging and Security Products and Services segment.

Two customers accounted for 92% of the Company’s accounts receivable at December 31, 2025 andthree customers accounted for 99% of the Company’s accounts receivable at September 30, 2025.

Offering Costs

The Company complies with the requirements of the ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A - “Expenses of Offering”. Offering costs consist principally of professional and underwriting fees incurred. Accordingly, in relation to the At the Market Offering (“ATM”) (See Note G), offering costs in the aggregate of approximately $259,000 were incurred, and were recorded to deferred offering costs on the condensed consolidated balance sheet as of December 31, 2025.

Segment Reporting

Historically, the Company operated inthree reportable segments: (1) Therapeutic DNA Production Services; (2) MDx Testing Services; and (3) DNA Tagging and Security Products and Services. As a result of the strategic restructuring during the fiscal year ended September 30, 2025, regarding the closure of its clinical laboratory, effective June 27, 2025, the Company’s MDx Testing Services segment is being reported in discontinued operations. Also, as a result of launching the Company’s DAT strategy in October 2025, the Company has added a new reportable segment; Digital Asset Treasury. Resources are allocated by the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) whom, collectively, the Company has determined to be its Chief Operating Decision Maker (“CODM”). The following is a brief description of the Company’s reportable segments.

**Digital Asset Treasury —**Segment operations consist of managing the Company’s digital assets and implementing its DAT strategy.

**Therapeutic DNA Production Services —**Segment operations consist of the Company’s nucleic-acid production solutions for the biopharmaceutical and diagnostics industries including LineaDNA, LineaRNAP and LineaIVT.

DNA Tagging and Security Products and Services — Segment operations consist of the manufacture and detection of DNA for industrial supply chains and security services. As discussed above, on February 13, 2025, the Company announced it was exiting its DNA Tagging and Security Products and Services business segment. The Company continues to strategically exit contracts relating to this segment and currently plans to continue to service certain of its existing DNA Tagging and Security Products and Services customer contracts.

The Company evaluates the performance of its segments and allocates resources to them based on revenues and operating income (losses). Operating income (loss) includes intersegment revenues, as well as a charge allocating all corporate headquarters costs. Since each vertical has shared employee resources, payroll and certain other general expenses such as rent, and utilities were allocated based on an estimate by management of the percentage of employee time spent in each vertical. Segment assets are not reported to, or used by, the CODM to allocate resources to, or assess performance of, the segments and therefore, total segment assets have not been disclosed.

Fair Value of Financial Instruments

The valuation techniques utilized are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect internal market assumptions. These two types of inputs create the following fair value hierarchy:

Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than Level 1 prices 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 related asset or liabilities.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of assets or liabilities.

The Company utilizes observable market inputs (quoted market prices) when measuring fair value whenever possible.

All the Company’s BNB are held by Build & Build, LLC, a wholly owned subsidiary. The Company has designated a principal market for BNB based on the market that it has access to and has the greatest volume and level of orderly transactions for BNB. The Company reassesses its principal market when facts and circumstances change, including but not limited to when new markets become accessible, or the volume/activity in the current principal market declines. Because BNB trades continuously across global markets, the Company applies a consistent valuation cut-off at midnight UTC on the reporting date to determine fair value.

Fair Value of Financial Instruments continued

The Company’s digital assets are measured at fair value on a recurring basis using quoted prices in its principal market (Level 1 inputs) as of the reporting date.

The Company’s OBNB Trust Units are measured at fair value on a recurring basis using quoted prices in its principal market (Level 1 inputs) as of the reporting date.

For fair value measurements categorized within Level 3 of the fair value hierarchy, the Company’s accounting and finance department, which reports to the CFO, determine its valuation policies and procedures.

As of December 31, 2025, there were no transfers between Levels 1,2 and 3 of the fair value hierarchy.

Recent Accounting Standards

In May 2025, the FASB issued ASU 2025-03,Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity. This standard clarifies the guidance in determining the acquirer in an acquisition transaction effected primarily by exchanging equity interests when the legal acquiree is a VIE that meets the definition of a business. The amendments require that an entity consider the same factors that are currently required for determining which entity is the accounting acquirer in other acquisition transactions. This guidance is effective for fiscal years beginning after December 15, 2026, and therefore will be effective beginning with the Company’s financial statements issued for the fiscal year ending September 30, 2028, with early adoption permitted. The amendments are required to be applied prospectively to any acquisition transaction that occurs after the initial application date. The Company is currently evaluating the impact of adopting this guidance on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU No. 2023-09,Income Taxes (Topic 740): Improvements to Income Tax Disclosures, that enhances the transparency of income tax disclosures by expanding annual disclosure requirements related to the rate reconciliation and income taxes paid. The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and should be applied prospectively with the option of retrospective application. The Company adopted this ASU as of October 1, 2025. The adoption of this ASU did not have a significant impact on its disclosures.

NOTE C — INVENTORIES

Inventories consist of the following:

NOTE D — DIGITAL ASSETS

The following table sets for the units held, costs basis, and fair value of digital assets held, as shown on the condensed consolidated balance sheet as of December 31, 2025:

Cost basis is equal to the cost of the digital asset, net of any transaction fees, if any, at the time of purchase or upon receipt. Digital assets are measured at fair value on a recurring basis in accordance with ASC 820, Fair Value Measurement, using a quoted price in active markets (Level 1 inputs). Fair Value presents the quoted prices on a principal market at midnight UTC on the measurement date.

The following table summarizes the Company's digital asset holdings as of:

NOTE E — INVESTMENT IN DIGITAL ASSET TRUST

Investment in digital asset trust measured at fair value consist of the following as of December 31, 2025:

The following table summarizes the Company's OBNB Trust Units investment holdings as of:

NOTE F — ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities are as follows:

NOTE G — CAPITAL STOCK

Nasdaq Ticker Change

Effective October 7, 2025 the Company changed its ticker symbol on the Nasdaq Capital Market from “APDN” to “BNBX”.

At the Market Offering

On November 4, 2025 the Company entered into an At The Market Offering Agreement (the “ATM”) with Lucid Capital Markets, LLC, as sales agent (the “Agent”), pursuant to which the Company may, from time to time, offer and sell shares of its common stock with an aggregate offering price of up to $8,157,932 through the Agent. Subject to the terms and conditions of the Agreement, the Agent will use its commercially reasonable efforts to sell the Shares from time to time, based upon the Company’s instructions. The Company has no obligation to sell any of the Shares, and may at any time suspend sales under the Agreement or terminate the Agreement in accordance with its terms. The Company has provided the Agent with customary indemnification rights. The Agreement contains customary representations and warranties, and the Company is required to deliver customary closing documents and certificates in connection with sales of the Shares. During the quarter ended December 31, 2025, the Company sold 10,759 shares of common stock for net proceeds of $30,749, after deducting commissions of $983.

Private Placement Offering

The Company completed two private placements: a Cash Private Placement on October 3, 2025, and a Cryptocurrency Private Placement on October 21, 2025 (collectively the “Private Placement”).

In Cash Private Placement, the Company issued 4,620,485 shares of the Company’s common stock and/or pre-funded warrants in lieu thereof at an offering price of $3.32 per share, to purchase shares of the Company’s common stock at a per share exercise price of $0.0001 (the “Cash Pre-Funded Warrants”), and anequal number of Series E-1 Warrants (the “Series E-1 Warrants”) to purchase shares of our common stock at a per share exercise price of $3.82.

In the Cash Private Placement, consideration included U.S. dollars or the cryptocurrency stablecoin issued by Circle Internet Group, Inc. commonly referred to as “USDC” paid to the Company as consideration for the Shares and/or Cash Pre-Funded Warrants and the Series E-1 Warrants. In the Cryptocurrency Private Placement, the Cryptocurrency Purchasers tendered units of Osprey BNB Chain Trust (OTCMKTS: OBNB) as consideration, with the Company receiving 0.126 units per Cryptocurrency Pre-Funded Warrant together with accompanying Series E-2 Warrant sold. Lucid Capital Markets acted as sole placement agent for the Private Placement.

In the Cryptocurrency Private Placement, the Company issued 3,444,191 pre-funded warrants (“the Cryptocurrency Pre-Funded Warrants” and together with the Cash Pre-Funded Warrants, the “Pre-Funded Warrants”) at an offering price of $3.32 per share, to purchase the Company’s common stock at a per share exercise price of $0.0001 per share and anequal number of Series E-2 Warrants (the “Series E-2 Warrants” and, together with the Series E-1 Warrants, the “Series E Warrants”) to purchase shares of common stock at a per share exercise price of $3.82. The Series E Warrants and the Pre-Funded Warrants were classified as equity in the accompanying condensed consolidated balance sheet.

The Company received a total of $24.9 million in net proceeds after deducting placement agent fees and offering costs, which consisted of $7.6 million in cash, net of placement agent fees and offering costs, $5.9 million in USDC and $11.4 million in OBNB Trust Units

The Pre-Funded Warrants are exercisable at $0.0001 per share, and the Series E Warrants are exercisable at $3.82 per share over afive-year term and expire on October 3, 2030. Exercise of the Cryptocurrency Pre-Funded Warrants was contingent upon obtaining stockholder approval and the delivery of unencumbered subscription funds. Stockholder Approval was obtained on December 12, 2025.

The Company entered into registration rights agreements with the accredited investors, committing to file an SEC registration statement for the resale of the securities within 30 days of the closing dates. In Compliance with the Registration Rights Agreements, the Company filed the required resale registration statement on October 30, 2025 and it was declared effective by the SEC on December 29, 2025. Lucid Capital Markets acted as the sole placement agent.

During and subsequent to the quarter ended December 31, 2025,406,730 and 475,270, respectively of the Pre-Funded Warrants were exercised.

Strategic DAS Agreement

In connection with the Private Placement, on September 29, 2025, the Company entered into a Strategic Digital Assets Services Agreement (the “Strategic DAS Agreement”) with Cypress LLC, a Puerto Rico limited liability company, and a related party (the “Services Provider”), pursuant to which the Company appointed the Services Provider to provide discretionary asset management services (i) in compliance with the Company’s BNB Strategy, (ii) with respect to any other cryptocurrency or digital asset strategies subject to the Company’s approval, in each case, solely with respect to the Account Assets (as defined below) in the accounts or cryptocurrency “wallets” identified by the Company after consultation with the Services Provider for an initial term offive years, which will automatically and without further action renew for successiveone year terms unless the Company or the Services Provider notifies the other in writing of its desire not to renew the Strategic DAS Agreement at least thirty days prior to the expiration of the term in effect.

As set forth in the Strategic DAS Agreement, the Company has agreed to pay to the Services Provider a fixed-rate management fee accrued and payable monthly (prorated for partial months) in arrears, equal to 1/12 of 1.25% per annum multiplied by the net asset value of the Account as of the last day of each month, before taking into account the estimated accrued incentive fee (as described below), if any. The management fee shall be payable within fifteen days of the Company’s receipt of an invoice from the Services Provider after the end of each month. In addition, the Company has agreed to pay to the Services Provider an incentive fee for each Incentive Period (as defined in the Strategic DAS Agreement) relating to the Account equal to 10% on net returns, multiplied by the amount, if any, by which the increase in net asset value of the Account during such Incentive Period (excluding any amounts contributed to or withdrawn from the Account during such Incentive Period) exceeds the sum of (x) net asset value for the Account as of the later of the effective date of September 29, 2025 and the last time an incentive fee was paid in respect of the Account and (y) the aggregate management fees, to the extent not included in the calculation of net asset value, to Services Provider during such Incentive Period.

The Strategic DAS Agreement has an initial term offive years. The Strategic DAS Agreement may be terminated by (i) either the Company or the Services Provider upon thirty days’ prior written notice for Cause (as defined in the Strategic DAS Agreement); (ii) by either the Company or the Services Provider, without Cause, effective as of the end of the initial term of the Strategic DAS Agreement or any renewal period, upon at least thirty days’ prior written notice of non-renewal; or (iii) by the Services Provider if it becomes unlawful under any applicable law for Services Provider to perform any or all of its obligations under the Strategic DAS Agreement, in which case the Services Provider shall immediately suspend its performance of all unlawful obligations under the Strategic DAS Agreement and terminate it with three days’ prior written notice to the Company. If the Strategic DAS Agreement is terminated by the Company for any other reason than with respect to the Services Provider’s Cause or pursuant to clause (ii) of the immediately preceding sentence, or by the Services Provider with respect to the Company’s Cause, the Company shall pay liquidated damages to the Services Provider in an amount equal to all fees and other compensation that would have accrued to Services Provider under the Strategic DAS Agreement from the date of the termination through the end of the then-current term (assuming a net asset value of the Accounts as of the date of termination, plus the Assumed Return on Investments (as defined in the Strategic DAS Agreement)), paid monthly throughout the term in effect in accordance with the Strategic DAS Agreement.

Both Joshua Kruger, the Chairman of the Company’s Board of Directors, and Patrick Horsman, the Company’s Chief Investment Officer are affiliates of Cypress LLC.

During the three-months ended December 31, 2025, the Company didnot incur any expenses under this agreement.

Strategic Advisor Agreement

In connection with the Private Placement, on September 29, 2025, the Company entered into a Strategic Advisor Agreement with Cypress Management LLC, a Puerto Rico limited liability company (the “Strategic Advisor”), and a related party, pursuant to which the Company appointed the Strategic Advisor to provide strategic advice, guidance and technical advisory services relating to the Company’s business, operations, growth initiatives and industry trends in the crypto technology sector for an initial term offive years, which will automatically and without further action renew for successiveone year terms unless the Company or the Strategic Advisor notifies the other in writing of its desire not to renew the Strategic Advisor Agreement at least thirty days prior to the expiration of the term in effect. The Strategic Advisor or the Company may terminate the Strategic Advisor Agreement immediately upon written notice to the other party if the Company or the Strategic Advisor, as applicable, materially breaches the Strategic Advisor Agreement and fails to cure such breach within thirty days after receipt of such written notice. Either the Company or the Strategic Advisor may terminate the Strategic Advisor Agreement by mutual agreement at any point during the term. Either the Company or the Services Provider may terminate the Strategic Advisor Agreement by giving a termination notice to the other party if the other party (a) voluntarily files or has filed against it a petition under applicable bankruptcy or insolvency laws that is not released within sixty days after filing, (b) proposes any dissolution, composition or financial reorganization with creditors or if a receiver, trustee, custodian or similar agent is appointed or takes possession with respect to all or substantially all property or business of such party, or (c) makes a general assignment for the benefit of creditors, and such termination would become effectiveten days after receipt of the termination notice. The Strategic Advisor Agreement shall automatically terminate upon termination of the Strategic DAS Agreement.

Pursuant to the terms of the Strategic Advisor Agreement, the Company pays a monthly fee of $60,000 to the Strategic Advisor and issued to the Strategic Advisor five year warrants to purchase shares of our common stock (the “Advisory Warrants”) in an aggregate amount equal to 1,986,634 shares of our common stock with an exercise price of $3.82 per share.

Both Joshua Kruger, the Chairman of the Company’s Board of Directors, and Patrick Horsman, the Company’s Chief Investment Officer are affiliates of Cypress LLC.

During the quarter ended December 31, 2025 the Company incurred $180,000 in fees under the Strategic Advisor Agreement. The Company also recorded $7,985,569 for the fair value of the Advisory Warrants, which was included in consulting expense for the quarter ended December 31, 2025.

Consulting Arrangements

In order to support the implementation of its BNB-focused treasury strategy, on September 23, 2025, the Company entered into consulting arrangements with Ground Tunnel Capital LLC (the “Consultant”) and an additional consulting agreement (collectively, the “Consulting Arrangements”) with the Consultant, pursuant to which the Company (i) engaged the Consultant to provide certain advisory and marketing services and (ii) will receive premium sponsorship benefits at all SkyBridge Alternatives Conference (“SALT”) conferences globally for a period ofthirty-six months. The Consulting Arrangements have a term ofthree years and shall terminate on September 23, 2028. Pursuant to the Consulting Arrangements, the Consultant shall be paid a fee of (a) $1,000,000 and (b) $250,000 paid quarterly from December 2025 until September 2027. In addition, immediately following the closing of the Cash Private Placement, the Consultant received Consultant Warrants (the “Consultant Warrants”) exercisable for a number of shares of common stock equal to 1% of the fully diluted outstanding equity of the Company as of immediately following the closing of the Private Placement. The exercise price per share of the Consultant Warrants is equal to $3.82 and the Consultant Warrants have a term offive years from the date of issuance.

The Company recorded $840,585 for the fair value of the Consultant Warrants, which was included in consulting expense for the quarter ended December 31, 2025.

Chief Investment Officer

On October 1, 2025, the Company appointed Patrick Horsman, an affiliate of the Services Provider and Strategic Advisor, as the Chief Investment Officer of the Company. Mr. Horsman receives monthly consulting compensation of $29,167 for serving as the Company’s Chief Investment Officer but is not an executive officer of the Company. Mr. Horsman is also an affiliate of the Strategic Advisor, which together with its affiliates provides services to the Company for compensation of approximately $720,000 on an annual basis. The Company recorded $111,616 in consulting and travel expenses under this agreement for the quarter ended December 31, 2025.

NOTE H — WARRANTS, STOCK OPTIONS and RESTRICTED STOCK UNITS

Warrants

The following table summarizes the changes in warrants outstanding. These warrants were granted as part of financing transactions, as well as in lieu of cash compensation for services performed or as financing expenses in connection with the sales of the Company’s common stock.

During the three-months ended December 31, 2025,142,608 of the May 2024 Series A Warrants were exercised for proceeds of $731,764.

Stock Options

On December 12, 2025, at a special meeting of stockholders, the Company’s stockholders approved an amendment to the Company’s 2020 Equity Incentive Plan to increase the number of authorized shares of common stock reserved for issuance by 5,000,000 shares.

During the quarter ended December 31, 2025, the Company granted 168,776 stock options to executive officers. The options have a strike price of $2.52 and vest 25% per quarter and become fully vested on theone-year anniversary from the date of grant.

The fair value of options granted during the three months ended December 31, 2025 was determined using the Black Scholes Option Pricing Model. For the purposes of the valuation model, the Company used the simplified method for determining the granted options expected lives. The simplified method is used since the Company does not have adequate historical data to utilize in calculating the expected term of options. The fair value for options granted was calculated using the following weighted average assumptions:

NOTE H — WARRANTS, STOCK OPTIONS and RESTRICTED STOCK UNITS continued

The Company recorded $633,120 as stock compensation expense within selling, general and administrative for the quarter ended December 31, 2025, which included $19,656 of expense related to the restricted stock units disclosed below. The weighted average grant date fair value per share for options granted during the three months ended December 31, 2025 was $2.38.

Restricted Stock Units

Restricted stock unit awards are valued at the market price of the Company's Common Stock on the grant date.

On October 17, 2025, the Company granted 168,628 restricted stock units to executive officers and members of the board of directors and 31,300 restricted stock units to employees, respectively, which vest ninety days from the date of grant.

NOTE I — COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leased office space under an operating lease in Stony Brook, New York for its former corporate headquarters. The lease was for a 30,000 square foot building. The Company entered into an amended lease agreement on February 1, 2023. The initial term was forthree years and expired on February 1, 2026. The lease for the corporate headquarters required monthly payments of$48,861, which was adjusted annually based on the US Consumer Price Index (“CPI”) and was adjusted to monthly payments of$52,440 commencing on February 1, 2025. In lieu of a security deposit, the Company provided a standby letter of credit of$750,000. On January 20, 2026, The Company entered into a new lease agreement for a total of 2,095 square feet for its new corporate headquarters in Stony Brook, New York, which includes both office space andtwo laboratories for a combined monthly payment of$8,665. The new lease term commenced on February 1, 2026 and will expire on January 31, 2027. On September 19, 2025, the Company entered into a lease agreement for approximately 175 square feet of office space in Windermere, Florida. This lease expires on September 30, 2026, and has monthly payments of$1,489. The lease for our new corporate headquarters, as well as the office space lease in Florida are both considered short-term lease obligations. The total rent expense for the quarters ended December 31, 2025 and 2024 was$161,787 and$188,558, respectively.

Employment Agreement

On September 28, 2025, the Board approved new Employment Agreements (together, the “Employment Agreements”) with Mr. Shorrock and Ms. Jantzen. The Employment Agreements provide that Mr. Shorrock will be appointed as Chief Executive Officer and President and Ms. Jantzen will continue to serve in her role as Chief Financial Officer of the Company. The terms of the Employment Agreements began on September 29, 2025 and Mr. Shorrock and Ms. Jantzen will each hold office until the election and qualification of a successor or until either individual’s earlier death, resignation or removal.

Pursuant to the Employment Agreements, Mr. Shorrock’s and Ms. Jantzen’s annual base salary will each be $400,000. In October 2025, Mr. Shorrock was paid a one-time cash bonus of $175,000 and Ms. Jantzen was paid a one-time cash bonus of $150,000. Mr. Shorrock and Ms. Jantzen both received stock options to purchase shares of common stock with a grant-date fair value of $200,000 which will vest quarterly overone year. These options were granted on December 15, 2025 at an exercise price of $2.52. Mr. Shorrock and Ms. Jantzen will each be eligible for a performance bonus in the event the Company enters into a strategic transaction (such as, but not limited to a merger, sale or licensing of all or substantially all of the Company assets that existed prior to September 17, 2025), or a restructuring, equal tofive percent (5.0%) of the net proceeds of the strategic transaction or net absolute cash retained at the time of the restructuring. The Board, acting in its discretion, may grant cash or equity/options/restricted stock units to Mr. Shorrock and Ms. Jantzen for achieving or progressing stated company goals.

NOTE I — COMMITMENTS AND CONTINGENCIES continued

The Employment Agreements also provide that upon termination without Cause (as defined in the Employment Agreements) or resignation for Good Reason (as defined in the Employment Agreements) of each of Mr. Shorrock’s and Ms. Jantzen’s employment then Mr. Shorrock and Ms. Jantzen will each beentitled to $400,000 or their then current annual base salary, together with all Accrued Benefits (as defined in the Employment Agreements). Upon a Change in Control (as defined in the Employment Agreements) or termination due to death or disability, Mr. Shorrock and Ms. Jantzen will each generally be entitled to receive the same payments and benefits they each would have received if their employment had been terminated by the Company without Cause (as described in the preceding paragraph), other than salary continuation payments.

Litigation

From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. When the Company is aware of a claim or potential claim, it assesses the likelihood of any loss or exposure. If it is probable that a loss will result and the amount of the loss can be reasonably estimated, the Company will record a liability for the loss. In addition to the estimated loss, the recorded liability includes probable and estimable legal costs associated with the claim or potential claim. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the Company’s business. There is no pending litigation involving the Company at this time.

NOTE J **—**SEGMENT INFORMATION

As detailed in Note B above, the Company currently hasthree reportable segments; (1) Therapeutic DNA Production Services, (2) Digital Asset Treasury, and (3) DNA Tagging and Security Products and Services. Resources are allocated by our CEO, and CFO whom, collectively the Company has determined to be our CODM. As a result of the strategic restructuring during the fiscal year ended September 30, 2025, regarding the closure of its clinical laboratory, effective June 27, 2025, the Company’s MDx Testing Services segment is being reported in discontinued operations.

Information regarding operations by segment for the three-months ended December 31, 2025 is as follows:

NOTE J — SEGMENT INFORMATION continued

Information regarding operations by segment for the three-months ended December 31, 2024 is as follows:

NOTE J – SEGMENT INFORMATION, continued

Reconciliation of segment loss from operations to consolidated loss before provision for income taxes is as follows for the three months ended:

NOTE K — DISCONTINUED OPERATIONS

On June 27, 2025, the Company implemented a strategic restructuring and realignment of resources to focus exclusively on its Therapeutic DNA Production Services business. As part of actions undertaken, the Company implemented a workforce reduction of approximately 27% of its then current headcount and has ceased operations at ADCL.

The following table presents the major classes of ADCL’s results within Net loss from discontinued operations, net of tax in the condensed consolidated statement of operations for the three months ended December 31, 2024:

NOTE K —DISCONTINUED OPERATIONS, continued

Assets and liabilities of discontinued operations associated with ADCL presented in the consolidated balance sheets as of December 31, 2025 and September 30, 2025 are included in the following table:

NOTE L — SUBSEQUENT EVENTS

On February 2, 2026, the Board of Directors appointed James Haft to serve as a director and as a member of the Nominating Committee of the Board, effective February 2, 2026, until his successor has been duly elected and qualified, or until his earlier resignation or removal. At the time of Mr. Haft’s appointment, the Board had a vacancy as the result of Ms. Schmalz Shaheen’s resignation.

For Mr. Haft’s services as a director, on February 2, 2026, the Board approved and entered into a letter agreement (the “Letter Agreement”) with Mr. Haft. Pursuant to the terms of the Letter Agreement, Mr. Haft received (i) a one-time cash fee of $40,000, and (ii) an initial option grant to purchase up to 93,000 shares of the Company’s common stock (“Initial Option Grant”) at a price of $1.31 per share. The Initial Option Grant will vest infour equal installments on May 2, 2026, August 2, 2026, November 2, 2026 and February 2, 2027.