Enhanced Group Inc.

Notes to Condensed Consolidated Financial Statements

1. Nature of the Business

Enhanced Group Inc. (the "Company" or "Enhanced") is a growth-stage company operating within the sports entertainment, performance technology, and consumer wellness markets. The Company operates under the "Enhanced" brand and is developing a portfolio of products and experiences that integrate athletic competition, scientific advancement, and consumer engagement.

The Company designs and produces the Enhanced Games, a multisport live event optimized for record-setting athletic performance, coupled with digital content distributed through various channels, social media, and streaming platforms.

The Company also operates Live Enhanced, a consumer wellness platform through which customers may access over-the-counter supplement blends and clinician-guided prescription-based hormone therapies, peptides, and longevity protocols provided through third-party telehealth service providers. Live Enhanced commenced full commercial operations in May 2026. Current product offerings include Stronger+ and Longer+.

The Company's primary activities include organizing live sporting events, producing and distributing related media content, and operating the Live Enhanced platform. The Company operates inone business segment.

On January 14, 2025, Enhanced US LLC, a Delaware limited liability company, was established and is a wholly owned subsidiary of Enhanced Group Inc. The purpose of this new entity is to support the Company’s expansion and operations in the U.S. market.

On November 18, 2025, Enhanced Emirates Limited, a limited liability company, was established in Abu Dhabi, United Arab Emirates, and is a wholly owned subsidiary of Enhanced Group Inc. The purpose of this new entity is to support the Company’s expansion of scientific advancement and consumer engagement.

Business Combination

On November 26, 2025, Enhanced Ltd., a Cayman Islands exempted company ("Enhanced" or the "Target Business") entered into a definitive business combination agreement (as amended, the "BCA" or “Business Combination Agreement”) with A Paradise Acquisition Corp. ("A Paradise," “APAD” or “Acquiror”) (NASDAQ: APAD), a special purpose acquisition company ("SPAC"), pursuant to which Enhanced Ltd. agreed to merge with A Paradise to become a publicly traded company.

On May 1, 2026, A Paradise convened its extraordinary general meeting of shareholders (the "Extraordinary General Meeting"). At the Extraordinary General Meeting, the shareholders approved the Business Combination Proposal.

On May 7, 2026, the Business Combination was consummated, and the combined company began trading as Enhanced Group Inc. on the NYSE under the symbol “ENHA” on May 8, 2026. In connection with consummation of the BCA, the Company issued shares to the SPAC sponsor (approximately $2.1 million), the outstanding Simple Agreements for Future Equity (“SAFEs”) converted into common stock (approximately $40.0 million), and the convertible preferred stock converted into common stock (approximately $26.9 million). See Note 3 for more information.

Liquidity and Ability to Continue as a Going Concern

The accompanying condensed consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business.

The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued.

The Company has incurred recurring losses since its inception, including a net loss of $61.9 million for the three months ended June 30, 2026 and $78.4 million for the six months ended June 30, 2026. The Company may not achieve profitability, and unless and until it does, the Company will continue to need to raise additional capital to fund its operations.

Through June 30, 2026, the Company has financed its operations primarily from the sale of equity and convertible securities and, during the second quarter of 2026, through the completion of the Business Combination.

Based on the Company’s recurring losses from operations incurred since inception, expectations of continuing operating losses for the foreseeable future, and need to raise additional capital to finance its future operations, management has concluded that its current cash and cash equivalents are not sufficient to fund its operations, and there is substantial doubt about the Company’s ability to continue as a going concern within twelve months following the issuance of the condensed consolidated financial statements. If the Company is unable to raise additional capital in a sufficient amount or on acceptable terms, the Company may have to significantly delay, or scale back its operations. If the Company raises additional funds through the issuance of additional debt or equity securities, it could result in substantial dilution to its existing stockholders and increased fixed payment obligations, and these securities may have rights senior to those of the Company’s shares of common stock. Any of these events could significantly impact the Company’s business, financial condition, and prospects.

The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty and have been prepared on a basis that assumes the Company will continue as a going concern.

Risks and Uncertainties

The Company is subject to risks and uncertainties common to early-stage companies, including dependence on key personnel, compliance with applicable regulations governing telehealth, performance-enhancing substances, and direct-to-consumer health platforms, and the ability to secure additional capital to fund operations. The Company’s clinical research study, conducted under the Abu Dhabi Department of Health Institutional Review Board’s (“IRB”) approval and the oversight of the Abu Dhabi Department of Health, involves substances that are already approved and prescribed by licensed clinicians, and does not constitute a drug development program requiring FDA approval.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. All intercompany transactions have been eliminated in consolidation. See Note 3 for more information about the accounting for the BCA and impact on the condensed consolidated financial statements. Certain prior period amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.

Unaudited Interim Financial Information

The accompanying condensed consolidated balance sheet as of June 30, 2026, and the condensed consolidated statements of operations and comprehensive loss, convertible preferred stock and stockholders’ deficit, for the three and six months ended June 30, 2026 and 2025 and cash flows for the six months ended June 30, 2026 and 2025 (collectively referred to as the “condensed consolidated financial statements”), and the financial data and other financial information disclosed in the notes to the condensed consolidated financial statements are unaudited. The unaudited condensed consolidated financial statements have been prepared on a basis consistent with the Company’s audited annual financial statements and, in the opinion of management, reflect all adjustments, consisting solely of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of June 30, 2026 and the results of its operations for the three and six months ended June 30, 2026 and 2025. The results for the three and six months ended June 30, 2026 are not necessarily indicative of results to be expected for the full year ending December 31, 2026, any other interim periods, or any future year or period. These condensed consolidated financial statements should be read in conjunction with the Company's audited financial statements for the years ended December 31, 2025 and 2024 included in its Form S-4 filed with the SEC on April 9, 2026.

Revenue

The Company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services.

The Company's revenue comprises two primary streams:

Health and Wellness Products and Services – DTC Revenue. Revenue from online sales of non-prescription health and wellness products is recognized at a point in time upon transfer of control to the customer, which generally occurs upon delivery. The Company also offers prescription-based hormone therapy, peptide, and longevity protocols through arrangements with independently licensed third-party telehealth providers, who hold the clinical relationship with, and are responsible for prescribing to, the patient. Because the Company arranges for these clinical services to be provided by another party and does not control the service before it is transferred to the patient, the Company acts as an agent rather than a principal with respect to the clinical component of these arrangements under ASC 606, and recognizes the associated revenue on a net basis (the amount retained by the Company) over the applicable service period. Revenue from the related product component of these arrangements is recognized gross, at the point in time control of the product transfers to the customer, consistent with the Company's other non-prescription product sales.

Sponsorship and Media Partnership Revenue. The Company enters into multi-element sponsorship agreements with corporate partners of the Enhanced Games, providing a bundle of content, streaming, branding, activation, hospitality, and other event-related and ongoing rights. Management evaluates the promised goods and services in each arrangement and typically identifies two distinct performance obligations: (i) deliverables concentrated at or around a specific Event, which are recognized at the point in time, or over the short duration, that the Event-related deliverables are transferred, and (ii) ongoing brand association, exclusivity, and distribution rights, which are stand-ready obligations satisfied over time and recognized ratably over the contract term. Because standalone selling prices are not directly observable for these rights, the Company allocates the transaction price between the two performance obligations using an adjusted market assessment approach, informed by third party statistics of the event, relative audience and impression value, rate-card data, and comparable-transaction evidence, which requires management judgment.

Consideration under sponsorship agreements may be received in cash, in a fixed dollar amount of equity securities of the sponsor, or in the form of advertising, marketing, or other services provided by the sponsor. Non-cash consideration is measured at fair value at contract inception in accordance with ASC 606, rather than at the face or stated value of such consideration; that fair value determination often requires significant estimates and judgment, including as to the value of restricted or thinly-traded securities and of advertising or marketing inventory for which observable market rates may be limited. Where a sponsor's consideration is settled in the sponsor's equity securities, the Company records a receivable for the shares and, upon receipt, an investment in equity securities carried at fair value under ASC 321, separately from revenue. Because such arrangements are typically denominated as a fixed dollar amount to be settled in shares, subsequent changes in the sponsor's share price do not affect the transaction price recognized as revenue. Where a sponsor's consideration is received in the form of goods or services, the Company evaluates, in its capacity as a purchaser of those goods or services, whether the related spend represents consideration payable to a customer under ASC 606. Because the goods or services received in these arrangements are distinct from, and are not paid for in excess of the fair value of, the sponsorship rights granted, such arrangements are presented gross – as revenue for the sponsorship rights provided and as marketing or other operating expense for the goods or services received – rather than as a reduction of revenue. The related expense is recognized as the underlying products or services are delivered or consumed, which may differ in timing from the Company's recognition of the related sponsorship revenue, with any such difference reflected in contract asset, contract liability, or prepaid expense balances, as applicable. Amounts received or contractually committed to be received prior to satisfaction of the related performance obligation are recorded as deferred revenue at fair value.

Games, athlete and event operating costs

Games, athlete and event costs primarily include costs associated with our athletes, science as well as venue and event costs related to the production of the Enhanced Games. Athlete costs include monthly stipends and benefits as well as world record bonuses and prize money incurred during the Enhanced Games. Science costs include costs related to the Clinical Research Study. Venue and event related costs include costs related to the temporary construction of the Enhanced Games complex as well as all hospitality related costs of running the Enhanced Games.

Selling, general and administrative Expenses

Selling, general and administrative expenses primarily include stock based compensation, personnel costs as well as rent, travel, professional service costs, marketing and overhead required to support operations. Marketing expenses represent costs incurred to promote the Company’s brand and initiatives within the global sports and entertainment industry. These expenses include third-party marketing and consulting costs, digital and social-media advertising, content production, and market research activities.

Transaction expenses consist of direct, incremental costs incurred in connection with the Business Combination including advisory and investment banking fees, legal fees, accounting fees, and other professional service fees, and regulatory filing fees.

Property and Equipment, Net

Property and equipment are recorded at historical cost, less accumulated depreciation. Depreciation is calculated using the straight-line method based upon the estimated useful lives of the assets, which best reflects the pattern of use. The estimated useful lives by asset category are as follows: temporary competition pools and tracks,3 to 5 years, reflecting their portable and removable nature and expected utilization across multiple Enhanced Games event cycles; fitness equipment,5 years; computer equipment,3 years; and furniture and fixtures,5 to 7 years. The Company tests for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, in accordance with ASC 360, Property, Plant, and Equipment. An impairment loss is recognized when the carrying amount of the asset exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposition of the asset, and is measured as the amount by which the carrying amount exceeds the asset's fair value.

Repairs and maintenance are expensed as incurred. Expenditures that increase the value or productive capacity of assets are capitalized. When property and equipment are retired, sold, or otherwise disposed of, the asset's carrying amount and related accumulated depreciation are removed from the accounts and any gain or loss is included within operating expenses in the Consolidated Statements of Operations.

Software Development Costs

The Company capitalizes costs to develop internal-use software in accordance with ASC 350-40, Intangibles — Goodwill and Other — Internal-Use Software. Effective January 1, 2026, the Company early adopted ASU No. 2025-06, Targeted Improvements to the Accounting for Internal-Use Software, which eliminates the previous development-stage model and instead requires capitalization to begin when management authorizes and commits to funding the project and it is probable that the project will be completed and the software used to perform its intended function, provided no significant development uncertainty exists. Costs incurred before these criteria are met — including evaluating software alternatives, determining system requirements, vendor selection, training, and data conversion — are expensed as incurred.

Capitalized internal-use software costs are included within property and equipment, net, and amortized on a straight-line basis over the software's estimated useful life, generally three tofive years, commencing when the software is ready for its intended use. Costs of upgrades and enhancements that result in additional functionality are capitalized, while other costs incurred after the software is ready for use (such as maintenance and ongoing operations) and marketing and promotional costs are expensed as incurred. The Company reviews capitalized software for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable, in accordance with ASC 360, Property, Plant, and Equipment; no impairments were recorded for the periods ended June 30, 2026 and December 31, 2025. The Company adopted ASU 2025-06 prospectively, and adoption did not have a material effect on its condensed consolidated financial statements.

Deferred Offering Costs

The Company has incurred deferred offering costs in connection with the BCA and recognized$7.1 million and$4.0 million in deferred offering costs as of March 31, 2026 and December 31, 2025, respectively. Deferred offering costs incurred through March 31, 2026 balance sheet date consisted of legal fees and other costs that are directly attributable and incremental to the BCA.

Upon consummation of the Business Combination, $3.0 million of deferred offering costs were offset against the proceeds received and charged against additional paid-in capital. To the extent that net proceeds were insufficient to absorb the full amount of deferred offering costs, the excess of $4.1 million was recognized as an expense as transaction expenses in the consolidated statement of operations in the three months ended June 30, 2026.

Simple Agreements for Future Equity Liabilities

In 2025, immediately prior to signing the BCA, the Company entered an equity private placement, issuing Simple Agreements for Future Equity (“SAFEs”) to investors for an aggregate amount of approximately$40 million. As of December 31, 2025, the Company received approximately$29.7 million of the anticipated$40 million raise. The remaining$10.3 million was received in March 2026. Each SAFE entitled investors, upon consummation of the BCA, to receive Enhanced common shares based on their investment amount, the Company’s post-money valuation cap of$1.2 billion, and fully diluted capitalization. These common shares were then exchanged for Enhanced Group Class A common stock, reflecting investors’ pro rata ownership. Upon the closing of the Business Combination on May 7, 2026, the SAFEs converted into 4,001,682 shares of Class A common stock and warrants to purchase 2,000,841 shares of Class A common stock. SAFE investors receivedone warrant for everytwo shares acquired, exercisable fortwo years. Refer to Note 7, Convertible Preferred Stock and Stockholders’ Deficit, for additional information on the Company’s convertible preferred stock.

The Company recorded subsequent changes in fair value in changes in fair value of SAFEs in the statements of operations and comprehensive loss. Debt issuance costs related to the SAFEs are expensed in the period incurred. Upon the May 7, 2026 closing of the Business Combination with A Paradise Acquisition Corp., the SAFE liability was extinguished and automatically converted into 4,001,682 shares of Class A Common Stock and 2,000,841 issued Common Warrants. The Company evaluated the SAFE Warrants under ASC 815-40 and determined they qualify for equity classification. Consequently, the extinguished SAFE liability was allocated between the Class A shares and the Warrants based on their relative fair values at the conversion date. Using a Monte Carlo simulation to estimate the fair value of the Warrants, the Company allocated $32.8 million to Class A Common Stock (including par value and additional paid-in capital) and $7.2 million to additional paid-in capital for the Common Warrants.

Recently Issued Accounting Pronouncements

In September 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU 2025-06 eliminates the project-stage framework that previously governed the accounting for costs to develop or obtain internal-use software – the preliminary-project, application-development, and post-implementation/operation stages – and replaces it with a single recognition threshold. Under that threshold, capitalization begins only when (i) management, with the relevant authority, has authorized and committed to funding the software project, and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, with early adoption permitted as of the beginning of an annual reporting period. The Company early adopted ASU 2025-06 effective January 1, 2026, the beginning of its 2026 annual reporting period, on a prospective basis to internal-use software costs incurred on or after that date. The Company did not have internal-use software costs previously capitalized under the legacy project-stage model to which the ASU's transition provisions would otherwise apply, and adoption did not result in a cumulative-effect adjustment. The costs discussed relating to the Company's Games App development project were evaluated, and where appropriate capitalized, under the single recognition threshold introduced by ASU 2025-06.

In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets. ASU 2025-05 amends ASC 326, Financial Instruments-Credit Losses, and introduces a practical expedient available for all entities and an accounting policy election available for all entities, other than public business entities, that elect the practical expedient. These changes apply to the estimation of expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, Revenue Recognition. Under the practical expedient, entities may assume that current conditions as of the balance sheet date remain unchanged for the remaining life of the asset when developing reasonable and supportable forecasts. This simplifies the estimation process for short-term financial assets. ASU 2025-05 is effective for the Company’s annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. ASU 2025-05 should be applied on a prospective basis. The Company adopted ASU 2025-05 effective January 1, 2026 on a prospective basis. As of the adoption date, the Company had no accounts receivable or contract assets within the scope of this standard, and the adoption did not affect the Company's consolidated financial statements. The Company has since recognized contract assets, as described in Note 4, Revenue and Segment Information, which are within the scope of ASU 2025-05, and applies the guidance in evaluating expected credit losses on that balance.

In November 2024, the FASB issued ASU No. 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” which includes amendments that require disclosure in the notes to condensed consolidated financial statements of specified information about certain costs and expenses. The amendments are effective for the Company’s annual periods after December 15, 2026, with early adoption permitted, and should be applied either prospectively or retrospectively. The Company is in the process of evaluating this ASU to determine its impact on the Company’s disclosures.

3. Reverse Recapitalization and Related Transactions

Description of the Transaction

On the Closing Date, A Paradise, a blank check company that migrated to and domesticated as a Texas corporation immediately prior to Closing, consummated the previously announced business combination (the "Business Combination") pursuant to the BCA, dated as of November 26, 2025, by and among APAD, A Paradise Merger Sub I, Inc., a Cayman Islands exempted company and direct wholly owned subsidiary of APAD ("Merger Sub"), and Enhanced Ltd, a Cayman Islands exempted company ("Enhanced" or the "Target Business"). Pursuant to the BCA, Merger Sub merged with and into Enhanced, with Enhanced surviving as a wholly owned subsidiary of APAD. In connection with the Closing, APAD changed its name to Enhanced Group Inc. APAD shareholders approved the Business Combination at an extraordinary general meeting held May 1, 2026, and the Company's Class A common stock commenced trading on the New York Stock Exchange under the symbol "ENHA" on May 8, 2026.

The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP, with Enhanced determined to be the accounting acquirer. This determination was based on Enhanced’s equity holders holding a majority of the voting power of the combined company, Enhanced’s senior management comprising substantially all of the combined company’s senior management, Enhanced’s operations representing substantially all of the combined company’s ongoing operations, and Enhanced’s relative size significantly exceeding that of APAD. Accordingly, the Business Combination was treated as the equivalent of Enhanced issuing stock for the net assets of APAD, accompanied by a recapitalization. The net assets of APAD were recorded at historical cost, with no goodwill or other intangible assets recognized. The Company’s historical financial statements prior to the Closing are those of Enhanced, and all share and per-share amounts have been retroactively restated to reflect the exchange ratio of 7.6021255 APAD shares for every one Enhanced share, which was established in the BCA (the "Exchange Ratio").

Trust Account, Redemptions, and SAFE Conversion

At the Closing, holders of 19,611,370 shares of APAD Class A common stock exercised redemption rights, receiving an aggregate of $201.7 million from APAD’s trust account. After redemptions and payment of transaction expenses, approximately $3.0 million of trust cash was released to Enhanced. Concurrently, the Company’s outstanding Simple Agreements for Future Equity ("SAFEs") automatically converted into 4,001,682 shares of Class A common stock and warrants to purchase 2,000,841 shares of Class A common stock. The warrants are exercisable at $10.00 per share fortwo years from the Closing Date and are callable by the Company if the Class A common stock trades at or above $15.00 per share for at least 20 of any 30 consecutive trading days.

Upon the Closing, all outstanding shares of Enhanced Ltd's Series A-1, Series A-2, and Series B convertible preferred stock, with an aggregate carrying value of approximately $26.9 million, were converted into 30,206,050 shares of Class A common stock at the Exchange Ratio of 7.6021255, with no gain or loss recognized on conversion. The preferred shares have been retroactively restated to reflect the change in capital structure as a result of the Business Combination.

Transaction Costs

Direct, incremental costs of the equity transaction, capitalized as deferred offering costs prior to the Closing, together with the value of advisor shares issued in connection with the Business Combination, were evaluated under SEC Staff Accounting Bulletin Topic 5.A. Because such costs exceeded the cash proceeds available for offset, approximately $3.0 million was charged against additional paid-in capital and the remaining approximately $6.2 million was expensed within transaction costs in the condensed consolidated statements of operations for the three and six months ended June 30, 2026. The Company also incurred other transaction expenses during the three and six months ended June 30, 2026, consisting of banking, investor relations, and other advisory fees directly related to the Business Combination that do not qualify as incremental costs of the equity transaction and are expensed as incurred. In total, the Company recognized transaction expenses of $10.9 million and $12.5 million for the three and six months ended June 30, 2026, respectively, in the condensed consolidated statements of operations and comprehensive loss.

Impact on Equity Structure

As a result of the reverse recapitalization, the Company’s equity structure reflects that of the legal acquirer, while the underlying assets and liabilities are those of Enhanced, recorded at historical carrying values. Shares and per-share amounts for all periods prior to the Closing have been retroactively restated using the Exchange Ratio for purposes of calculating basic and diluted earnings per share in accordance with ASC 260, Earnings Per Share.

4. Revenue and Segment Information

The Company generates sponsorship revenue from multi-element agreements with corporate partners of the Enhanced Games, its live sports and entertainment event. These agreements typically bundle (i) rights and benefits concentrated at or around a specific Event, such as on-site activation, broadcast and streaming integration, hospitality, and Event-day brand exposure, with (ii) ongoing brand association, category exclusivity, and platform and website integration rights delivered continuously over the contract term. The Company has concluded that these represent two distinct performance obligations – Event-specific deliverables, recognized at the point in time (or over the short duration) the Event occurs, and ongoing brand-association and distribution rights, recognized ratably over the term of the agreement – allocated based on an adjusted market assessment approach as described in Note 2. Consideration under these agreements may be paid in cash, in equity securities of the counterparty, or in the form of advertising and marketing services provided to the Company.

Two sponsorship agreements, further described under Concentration below, together accounted for substantially all of the Company's sponsorship revenue for the three and six months ended June 30, 2026 and were settled, in whole or in part, in non-cash consideration.

Where consideration is denominated as a fixed dollar amount to be settled in a counterparty's equity securities, the Company recognizes revenue equal to the fixed dollar amount; subsequent changes in the counterparty's share price do not affect revenue, and the shares (or the Company's unconditional right to receive them) are accounted for separately from revenue, as a contract asset and, upon receipt, as an investment in equity securities measured at fair value. Where consideration is received in the form of advertising and marketing inventory, the inventory is measured at its fair value at contract inception; because the inventory received is a distinct service obtained at its fair value and is used to promote the Company's own DTC products rather than the sponsor's, the related arrangement is presented on a gross basis, with revenue recognized for the sponsorship rights provided and marketing expense recognized for the inventory received and consumed within marketing expense in the condensed consolidated statements of operations and comprehensive loss; timing differences between revenue recognition and inventory consumption are reflected in a contract asset (see Contract Balances below).

In the aggregate, the Company recognized $17.5 million of revenue from these two arrangements for the three and six months ended June 30, 2026, comprised of Event-specific performance obligations recognized upon occurrence of the related Events and ratable portions of the related ongoing brand-association performance obligations, together with $4.2 million of associated marketing expense. The Company also purchases technology and professional services from one of these sponsors in exchange for cash under the same overall arrangement; the related capitalization policy is described in Note 2, Summary of Significant Accounting Policies.

The Company generates direct-to-consumer (“DTC”) revenue from online sales of over-the-counter health and wellness products, which is recognized at a point in time upon transfer of control to the customer, and from prescription-based hormone therapy, peptide, and longevity services and related products, which are provided through arrangements with independently licensed third-party telehealth providers and for which the Company recognizes revenue on a net basis, as described in Note 2, over the applicable service period. DTC revenue was not material for the three and six months ended June 30, 2026.

Contract Balances

Contract assets relate to the sponsorship agreement described above under which consideration is received in the form of equity securities as well as advertising and marketing services rather than cash. For consideration received in advertising and marketing services, the balance represents the excess of cumulative revenue recognized over the cumulative fair value of advertising inventory consumed and amounts otherwise invoiced or received. Deferred revenue, which is included within other current liabilities in the unaudited condensed consolidated balance sheet, relates to consideration received or contractually committed in advance of the Company's performance, including the portion of the fixed-dollar, equity-settled sponsorship arrangement described above allocated to the ongoing brand-association performance obligation that had not yet been recognized as of June 30, 2026, and amounts collected in advance under DTC product subscriptions.

The Company did not recognize any significant revenue during the three and six months ended June 30, 2026 from performance obligations satisfied in prior periods.

Remaining Performance Obligations

As of June 30, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations under the Company's sponsorship agreements was $4.5 million ($1.9 million and $2.6 million relating to thetwo sponsorship agreements described above, respectively), which the Company expects to recognize over the following twelve months. The Company applies the practical expedient in ASC 606-10-50-14 and does not disclose remaining performance obligations for contracts with an original expected duration of one year or less.

Concentration

Fina ncial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and contract assets in relation to sponsorship agreements.

Two sponsors each individually accounted for more than 10% of the Company's revenue for the six months ended June 30, 2026, together representing substantially all revenue for the period. One of these arrangements is settled in advertising and marketing services rather than cash; the other is to be settled in a fixed amount of equity securities of the counterparty.

Because the consideration under both arrangements is non-cash, the Company's principal risk with respect to these arrangements relates to the counterparties' continued ability and willingness to perform – deliver the contracted shares or advertising inventory, as applicable – rather than to cash collection. The Company monitors the financial condition and performance of these counterparties on an ongoing basis, including through review of each counterparty's publicly available financial information.

Segment Information

The Company hasone operating and reportable segment related to the organization, production, and commercialization of performance sports events and the direct-to-consumer distribution of health and wellness products and services. Factors used in determining the reportable segment include the nature of the Company's activities, the organizational and reporting structure, and the type of information reviewed by the chief operating decision maker ("CODM"), its chief executive officer, to allocate resources and evaluate financial performance.

Net loss is the key measure of segment profit and loss that the CODM uses to allocate resources and assess performance. The CODM uses consolidated net loss, assessed against budget through a monthly consolidated budget-to-actual reporting package, to evaluate the Company's expenditures and monitor results. The CODM considers budget-to-actual variances and available cash when making decisions about the allocation of resources across the organization. The CODM does not regularly receive or act upon any supplemental non-GAAP measure, such as Adjusted EBITDA, as a basis for resource allocation or performance assessment.

Significant expenses regularly provided to the CODM and included within net loss consist of the following categories, each of which is separately presented on the Company's condensed consolidated statements of operations and comprehensive loss: Games, Athletes and Events Operating Costs, Selling, General and Administrative, Transaction Expenses, and Depreciation. Other items within net loss not captured in the foregoing categories are considered as "other segment items", and primarily consist of interest income, interest expense, and other non-operating items.

The Company's long-lived assets are located in the United States.

5. Equipment, Net

Equipment consists of the following:

Depreciation and amortization expense was $69,207 and $85,868 for the three and six months ended June 30, 2026, respectively. Depreciation and amortization expense was $995 and $1,193 for the three and six months ended June 30, 2025, respectively.

6. Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following:

As of June 30, 2026 and December 31, 2025, approximately $21.6 million andnil, respectively, of games related expenses are included in accounts payable and accrued expenses.

7. Convertible Preferred Stock and Stockholders’ Deficit

Capital Structure Following the Business Combination

In connection with the Closing of the Business Combination on May 7, 2026, the Company’s common shares were reclassified into Class A common stock and Class B common stock, par value $0.0001 per share, as described in Note 3, Reverse Recapitalization and Related Transactions. The Company is authorized to issue 310,000,000 shares of Class A common stock and 330,000,000 shares of Class B common stock. Class A and Class B common stock vote together as a single class, withone vote per Class A share andten votes per Class B share; Class B common stock does not participate in the economic rights of the Company, including dividends, distributions, or liquidation proceeds. Accordingly, Class B common stock provides enhanced voting rights but does not represent an ownership interest in the Company's earnings or net assets. Class B common stock held by Apeiron Incubation Limited is subject to transfer restrictions set out in the Company’s Certificate of Formation, and does not otherwise convert into Class A common stock.

As of June 30, 2026,128,972,162 shares of Class A common stock and 258,837,933 shares of Class B common stock were issued and outstanding. As of December 31, 2025, the Company had 10,233,183 shares of common stock issued and outstanding, prior to the Business Combination and 107,999,991 Class A common stock issued and outstanding, as retroactively adjusted for the Exchange Ratio, respectively. In addition, the Company has reserved sufficient shares of Class A common stock for issuance upon the exercise of the warrants.

Warrants

The following table summarizes the Company’s warrant activity for the six months ended June 30, 2026:

(1) See Note 3, Reverse Recapitalization and Related Transactions

(2) Issued concurrently with the Class A common stock sold in the Tranche 1 Closing of the private placement described in Note 10, Private Placement Financing

(3) See Note 9, Stock Based Compensation

Convertible Preferred Stock Outstanding

Prior to the Business Combination, the Company had outstanding Series A-1, Series A-2 and Series B convertible preferred shares, collectively referred to as "Enhanced preferred shares."

Each share of preferred stock was, at the option of the holder, convertible at any time into common shares at a specified conversion price, determined by multiplying the number of preferred shares being converted by the applicable conversion rate. The conversion rate in effect at any time was determined by dividing the preferred stock issue price by the conversion price then in effect. The conversion price applicable to the Series A-1 preferred shares was $1.65 per share, the conversion price applicable to the Series A-2 preferred shares was $3.30 per share, and the conversion price applicable to the Series B preferred shares was $14.35 per share.

The preferred stock was also subject to automatic conversion into common stock upon a qualified public offering or special purpose acquisition company transaction meeting specified minimum proceeds thresholds, or upon the written consent of the requisite holders. In connection with the closing of the Business Combination on May 7, 2026, all outstanding shares of Series A-1, Series A-2, and Series B preferred stock automatically converted into common shares in accordance with these terms, and the resulting common shares were then exchanged for Class A common shares of the combined company pursuant to the Business Combination Agreement and the applicable Exchange Ratio. No shares of preferred stock remain outstanding as of June 30, 2026. See Note 3, Reverse Recapitalization and Related Transactions for further detail.

8. Net Loss Per Share

Basic and diluted net loss per common share for the three and six months ended June 30, 2026 and 2025 was calculated as follows:

The Company computes net loss per share using the two-class method for periods in which participating securities were outstanding. Prior to the Business Combination, the Company's convertible preferred stock was a participating security because it shared in dividends with common stock on an as-converted basis. As the Company incurred net losses in all periods presented and the preferred holders had no obligation to fund losses, no losses were allocated to the preferred and net loss attributable to common stockholders equals net loss. On May 7, 2026, all outstanding convertible preferred stock converted into common stock and the Company retroactively restated the preferred stock to reflect the change in capital structure as a result of the Business Combination. Thereafter, the Company’s only participating securities outstanding relate to the PIPE Common Warrants.

Basic and diluted net loss per share are computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding. Potentially dilutive securities were excluded because their effect would have been anti-dilutive in all periods presented.

The Company excluded the following potential shares of common stock, presented based on amounts outstanding at each stated period end, from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:

9. Stock-Based Compensation

2025 Company Incentive Plan

In October 2025, the Company adopted the 2025 Company Incentive Plan (the “2025 Plan”) to grant stock option awards to its officers, employees and contractors as compensation for their services to the Company. Under the 2025 Plan, up to 150,916,885 shares of common stock were made available for issuance. Stock option awards granted under the 2025 Plan generally vest over 36 or 48 months, with 33% or 25% vestingone year after the grant date and the remainder vesting in equal monthly installments over the following 24 or 36 months. All awards expire no later thanten years from the date of grant.

In connection with the Business Combination, the 2025 Plan was terminated effective upon the consummation of the Business Combination on May 7, 2026, and no new awards may be granted under the 2025 Plan after that date. Each option outstanding under the 2025 Plan as of the effective time of the Business Combination was converted into an option to acquire shares of the Company’s Class A common stock, and outstanding awards continue to be governed by the terms of the 2025 Plan and the applicable award agreements. Following the Business Combination, new equity awards are made under the Omnibus Incentive Plan described below.

Post-Business Combination Equity Plans

In connection with the Business Combination, the Company’s stockholders approved, and the Company adopted, the Enhanced Group Inc. Omnibus Incentive Plan (the “Omnibus Incentive Plan”), which became effective on May 7, 2026. The Omnibus Incentive Plan provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based and cash-based awards to employees, directors and consultants of the Company and its affiliates. The initial aggregate number of shares of Class A common stock available for issuance under the Omnibus Incentive Plan is 6,711,521, subject to adjustment as provided in the plan.

The Company’s stockholders also approved, and the Company adopted, the Enhanced Group Inc. Founder Plan (the “Founder Plan”), which became effective on May 7, 2026. The initial aggregate number of shares of Class A common stock available for issuance under the Founder Plan is 6,711,521, subject to adjustment as provided in the plan.

In addition, the Company’s stockholders approved, and the Company adopted, the Enhanced Group Inc. Employee Share Purchase Plan (the “ESPP”), which became effective on May 7, 2026. The initial aggregate number of shares of Class A common stock available for issuance under the ESPP is 2,684,608, subject to adjustment as provided in the plan. As of June 30, 2026, no offering period under the ESPP had commenced and no shares had been issued under the ESPP

To estimate the fair value of the Company’s stock options, granted during the three and six months ended June 30, 2026, the Company used the Black-Scholes OPM. The following key assumptions were used to estimate the fair value, presented on a weighted average basis:

During the three and six months ended June 30, 2026, the Company recognized $0.7 million and $1.4 million in stock-based compensation expense related to stock options within general and administrative expenses, respectively.

As of June 30, 2026, there is $5.0 million of unrecognized stock-based compensation expense that is expected to be recognized over a weighted average period of approximately 2.8 years.

Total option activity for the three and six months ended June 30, 2026 is summarized as follows:

Using the Black-Scholes OPM, the weighted average grant-date fair value of options granted during the three and six months ended June 30, 2026, was $7.04 per option. As of June 30, 2026, the aggregate intrinsic value of options outstanding and exercisable was approximately $2.2 million, based on the excess of the fair value of the Company's common stock over the applicable exercise prices of the options.

Top-up Awards

Prior to the approval of the Company’s Incentive Plan, the Company had contingent arrangements with certain individuals to provide additional value in light of a higher-than-anticipated exercise price under previously issued options. On March 18, 2026, the Company’s board of directors approved Top-Up Awards to 34 grantees, each providing the right to receive a fixed number of the Company’s common shares – determined at grant as the individual’s Top-Up Amount divided by a fixed fair market value of $76.02 per share, for an aggregate of 527,709 shares (as retroactively adjusted for the Exchange Ratio) – contingent on completion of the Business Combination. The awards are classified as equity, as both the dollar-denominated Top-Up Amount and the per-share settlement price were fixed at grant, resulting in a fixed number of shares issuable.

The Business Combination, the sole performance condition, was completed on May 7, 2026. The Top-Up Awards were therefore considered granted on that date. Awards held by grantees with no further service obligation were recognized in full at that date; awards held by grantees who must remain available in an advisory capacity through settlement are recognized straight-line over that remaining service period. For the three and six months ended June 30, 2026, the Company recorded $4.3 million of stock-based compensation related to these awards under the Selling, general and administrative expenses of the accompanying condensed consolidated statements of operations

As of June 30, 2026, unrecognized compensation cost related to the unvested portion of the Top-Up Awards was $989,821, which is expected to be recognized over the remaining service period through the August 2026 issuance date.

Consultant warrants

In April 2026, the Company granted warrants to purchase an aggregate of 107,471 common shares tofour consultants, at an exercise price of $9.32 per share and a contractual term through October 29, 2035, in exchange for services. Applying the Exchange Ratio, these amounts convert to 817,008 shares of the Company's Class A common stock at an exercise price of $1.23 per share. The warrants are equity-classified and compensation cost is recognized over the requisite service period. Fair value was estimated using a Black-Scholes option-pricing model, resulting in fair values ranging from $70.68 to $71.20 per warrant. The fair value was determined reflecting a stock price of $76.02 (derived from the business-combination value of $10.00 per share multiplied by the 7.6021255 exchange ratio), an exercise price of $9.32 ($1.23 per share post conversion), expected volatility of 90.0%, risk-free interest rates ranging from 3.91% to 4.01%, and a 0% expected dividend yield. The expected term of the awards ranges from 5.16 to 5.85 years and was determined using the simplified method for both employee and non-employee awards, as the non-employees served in roles comparable to employees.

The Company recognized$2.8 millionof share-based compensation expense related to these warrants for the quarter ended June 30, 2026. Of this amount, $2,013,634 was recorded under Selling, general and administrative expenses and $830,525 was recorded under Games, athletes and event operating costs. As of June 30, 2026, unrecognized compensation cost was $4.6 million, expected to be recognized over a weighted-average period of approximately 2.4 years.

10. Private Placement Financing

Transaction Overview

On June 14, 2026, the Company entered into a Securities Purchase Agreement (the "SPA") with certain investors, including Apeiron Investment Group Limited ("Apeiron"), the family office of Co-Founder and Chairman Christian Angermayer, and Maximilian Martin, Co-Founder and Chief Executive Officer of the Company, pursuant to which the Company agreed to issue and sell in a private placement an aggregate of 12,853,468 shares of Class A Common Stock and accompanying common warrants (the "Common Warrants") at a combined purchase price of $3.89 per share, for expected aggregate gross proceeds of approximately $50.0 million.

The private placement is structured inthree sequential closings:

•Tranche 1 Closing occurred on June 17, 2026, pursuant to which the Company issued 6,426,733 shares of Class A Common Stock and 6,426,733 Common Warrants to purchase 6,426,733 shares of Class A Common Stock at an exercise price of $3.89 per share, generating gross proceeds of $25.0 million. A portion of the Tranche 1 Closing proceeds was used to repay in full the outstanding principal and accrued interest under the Working Capital Promissory Note dated March 18, 2026 issued by the Company in favor of Apeiron;

•Tranche 2 Closing occurred on July 23, 2026, generating gross proceeds of $11.7 million from Apeiron. Prior to June 30, 2026, the Company received $8.5 million from Apeiron as partial funding toward the Tranche 2 Closing. As Tranche 2 Closing had not occurred as of June 30, 2026, and the related shares and warrants had not yet been issued, the $8.5 million received was recorded as Additional Paid in Capital in the accompanying condensed consolidated balance sheets;

•Tranche 3 Closing is expected to close shortly and is expected to generate gross proceeds of approximately $13.3 million consisting of approximately $8.3 million from Apeiron and approximately $5.0 million from the Company's Chief Executive Officer.

Concurrently with each closing, the Company executed a Registration Rights Agreement obligating it to file a registration statement covering the resale of the shares and warrant shares issued at each respective closing within 30 days of such closing, subject to liquidated damages for any missed deadlines of 1.0% of aggregate proceeds per 30-day period, capped at 3.0% in the aggregate.

Accounting Treatment

Under ASC 815-40, the Common Warrants are indexed to the Company's own stock and meet all settlement conditions required for equity classification. The shares of Class A Common Stock and Common Warrants are both classified as equity, and the proceeds from each closing are allocated between the two instruments based on their relative fair values at the respective closing date, with the fair value of the Common Warrants of $3.02 determined using a Monte Carlo simulation model to capture path-dependent features including the accelerated expiration provision and the anti-dilution adjustment. The table below presents the key assumption utilized in the valuation.

11. Income Taxes

The Company didnot record any income tax expense for the three and six months ended June 30, 2026 and 2025. The Company has incurred net operating losses for all the periods presented and has not reflected any benefit of such net operating loss carryforwards in the accompanying financial statements. The Company has recorded a full valuation allowance against all of its deferred tax assets as it is not more likely than not that such assets will be realized in the near future.

It is the Company's policy to record penalties and interest related to income taxes as a component of income tax expense. The Company hasnot recorded any interest or penalties related to income taxes during the three and six months ended June 30, 2026 and 2025. The Company has not identified any uncertain tax positions in the periods since inception.

The effective tax rates differ from the statutory tax rates for the three months ended June 30, 2026 and 2025 primarily due to the Company’s full valuation allowance position against domestic deferred tax assets. The provision for income taxes for the three and six months ended June 30, 2026 and 2025 included estimated federal, state and foreign income taxes in jurisdictions in which the Company does not have sufficient tax attributes.

As of June 30, 2026 the Company has a valuation allowance of approximately $23 million against all net domestic deferred tax assets for which realization cannot be considered more likely than not at this time. Management assesses the need for the valuation allowance on a quarterly basis. In assessing the need for a valuation allowance, the Company considers all positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and past financial performance. As a result, management has concluded, as of June 30, 2026, it is more likely than not the Company’s net domestic deferred tax assets will not be realized, and a full valuation allowance against all net domestic deferred tax assets is still warranted as of June 30, 2026. The valuation allowance against these deferred tax assets may require adjustment in the future based on changes in the mix of temporary differences, changes in tax laws, and operating performance. If and when the Company determines the valuation allowance should be released (i.e., reduced), the adjustment would result in a tax benefit reported in that period’s Consolidated Statements of Operations, the effect of which would be an increase in reported net income.

During the period, the Company completed its domestication from the Cayman Islands to Texas. Management evaluated the income tax consequence of the transaction, including the impact on deferred tax assets and liabilities, the realizability of tax attributes and potential limitations under Section 382 of the Internal Revenue Code. The Company does not believe the domestication resulted in a change in tax status requiring a discrete tax adjustment, as the Company was previously subject to US income tax reporting through its existing US operations.

12. Commitments and Contingencies

From time to time, in the ordinary course of business, the Company is subject to litigation and regulatory examinations as well as information gathering requests, inquiries and investigations.

The Company may be subject to claims and legal proceedings arising in the ordinary course of business; as of June 30, 2026, the Company was not a party to any legal proceedings that management believes would, individually or in the aggregate, have a material adverse effect on the Company's financial condition, results of operations, or cash flows.

13. Related parties

Working Capital Note

In order to access additional capital prior to the Enhanced Games, on March 18, 2026, Enhanced entered into a Working Capital Note with Apeiron Investment Group (“Apeiron”) for a line of credit commitment up to $20.0 million. The terms of the Working Capital Note provide for an applicable interest rate of 5.0% per annum and a maturity date of September 18, 2027. The Working Capital Note also provides for mandatory prepayment of amounts outstanding under the Working Capital Note upon Closing if (a) the Business Combination has been consummated and (b) if after A Paradise shareholder redemptions and the payment of transaction expenses, the amount remaining in the Trust Account exceeds $20.0 million; provided that such mandatory prepayment shall in no event exceed the amount by which such funds that remain in the Trust Account exceed $20.0 million. The Working Capital Note also provides that, in consideration for the commitment thereunder, the lock-up restrictions applicable to Apeiron and its affiliates under the transaction support agreement entered into in connection with the Business Combination (the “Transaction Support Agreement”) shall, in the event Apeiron or its applicable affiliates has entered into any pledge, hedge, swap or other arrangement that transfers to another, or disposes of (either alone or in connection with one or more events or developments (including the satisfaction or waiver of any conditions precedent)), any of the interests (including economic consequences of ownership) with respect to any shares of Enhanced Group, cease to apply to such shares. During the second quarter of 2026, the Company borrowed an aggregate $11.8 million under the Working Capital Note. Following the Tranche 1 Closing of the Company’s private placement financing on June 17, 2026, the Company repaid all outstanding principal and accrued interest under the Working Capital Note using proceeds received from the Tranche 1 Closing of the private placement financing. As a result, no amounts remained outstanding as of June 30, 2026.

The Company recognized $79,760 of interest expense related to the Working Capital Note during the three and six months ended June 30, 2026.

The repayment and extinguishment of the Working Capital Note was accounted for as a debt extinguishment in accordance with ASC 470, Debt.

Simple Agreements for Future Equity Liabilities

The SAFEs issued to Apeiron were issued on the same terms as those issued to unrelated third-party investors in the same private placement. Pursuant to the Business Combination Agreement and related closing transactions, all outstanding SAFE instruments converted into equity upon consummation of the Business Combination on May 7, 2026.

Private Placement Financing Participation by Related Parties

On June 14, 2026, the Company entered into a Securities Purchase Agreement providing for the sale of Class A common stock and accompanying warrants in a private placement (the "PIPE") inthree tranches at $3.89 per share and warrant. Certain related parties participated as follows:

Apeiron subscribed for an aggregate of 5,141,388 shares and accompanying warrants across the Tranche 2 and Tranche 3 Closings, for aggregate consideration of $20.0 million. As of June 30, 2026, the Company had received a $8.5 million deposit representing partial funding for Tranche 2. See Note 10, Private Placement Financing, for additional information regarding the related subscription funding.

Maximilian Martin, the Company's Co-Founder, Chief Executive Officer, and a director, subscribed for 1,285,347 shares and accompanying warrants in the Tranche 3 Closing, for aggregate consideration of $5.0 million.

As of June 30, 2026, Tranche 2 and 3 were not closed. Both parties subscribed on the same terms as unaffiliated investors in Tranche 1 of the PIPE.

Separately, in connection with the PIPE, the Company repaid in full the Working Capital Note dated March 18, 2026, issued in favor of Apeiron, using a portion of the Tranche 1 proceeds. For accounting treatment of the PIPE warrants, see Note 10, Private Placement Financing.

14. Subsequent Events

Combination Private Placement — Tranche 2 and 3 Closings

On July 23, 2026, the Company completed Tranche 2 of its $50.0 million Private Placement pursuant to the Securities Purchase Agreement dated June 14, 2026 for aggregate proceeds of $11,749,998 (the “Tranche 2 Closing”).

The Company expects to complete the third and final closing (the “Tranche 3 Closing”) of the Private Placement shortly, from which it expects to receive gross proceeds of approximately $13.3 million, consisting of approximately $8.3 million from Apeiron and approximately $5.0 million from the Company’s Chief Executive Officer. Because the Tranche 2 Closing occurred, and the Tranche 3 Closing is expected to occur after June 30, 2026, their proceeds are not reflected in the accompanying condensed consolidated balance sheet as of June 30, 2026. The $8.5 million from Apeiron Tranche 2 Closing funding prior to June 30, 2026 is included in cash and presented as Additional Paid in Capital within the condensed consolidated balance sheet as of that date.