Mosaic ImmunoEngineering Inc.

Previous wording

On April 26, 2024, we entered into a binding term sheet (“Binding Term Sheet”) with Oncotelic Therapeutics, Inc. (“Oncotelic”) pursuant to which we intend to acquire (i) certain rights to Oncotelic’s clinical stage necroptosis cancer therapies associated with its vascular disruptive agents (“VDAs”) and related regulatory and clinical packages, and (ii) non-exclusive access to its proprietary Artificial Intelligence (“AI”) technologies for identifying immunotherapy combinations, in exchange for the issuance of shares of our common stock valued at $15.0 million upon execution of the definitive agreement (representing 47,923,322 shares of our common stock), or a combination of common stock and preferred stock to be determined by the parties, along with additional milestones allowing Oncotelic to earn up to an additional $15.0 million in shares of common stock that would be valued at the time of issuance, if earned. Pursuant to the Binding Term Sheet, we and Oncotelic agreed to negotiate in good faith towards the execution of a definitive agreement and the closing of the transaction within ninety (90) days, which is subject to customary due diligence and other conditions, including us obtaining shareholder approval for the transaction and receiving waivers from our holders of Convertible Notes representing at least 90% of the principal amount outstanding from any payment that would become due and payable upon a corporate transaction as contemplated under the Binding Term Sheet.

Current wording

On April 26, 2024, we entered into a binding term sheet (“Binding Term Sheet”) with Oncotelic Therapeutics, Inc.(“Oncotelic”) pursuant to which we intend to acquire (i) certain rights to Oncotelic’s clinical stage necroptosis cancer therapies associated with its vascular disruptive agents (“VDAs”) and related regulatory and clinical packages, and (ii) non-exclusive access to its proprietary Artificial Intelligence (“AI”) technologies for identifying immunotherapy combinations, in exchange for shares of our common stock valued at $15.0 million upon execution of the definitive agreement, or a combination of common stock and preferred stock to be determined by the parties, along with additional milestones allowing Oncotelic to earn up to an additional $15.0 million in shares of common stock that would be valued at the time of issuance, if earned. Pursuant to the Binding Term Sheet, we and Oncotelic agreed to negotiate in good faith towards the execution of a definitive agreement and the closing of the transaction, which is subject to customary due diligence and other conditions, including obtaining shareholder approval for the transaction and receiving waivers from our holders of Convertible Notes representing at least 90% of the principal amount outstanding from any payment that would become due and payable upon a corporate transaction as contemplated under the Binding Term Sheet. The Binding Term Sheet expired on June 30, 2025.

Previous wording

On November 18, 2024, we entered into an unsecured convertible promissory note (“Note Purchase Agreement”) with an accredited investor (“Investor”) for proceeds of up to $200,000 to be used for general corporate purposes. On December 4, 2024, the Company received $200,000 under the note purchase agreement and issued an unsecured convertible note bearing interest at a rate of 5% per annum that is due and payable upon closing a financing of at least $10.0 million or convertible into shares of common stock of the Company, at the sole discretion of the accredited investor. The number of shares of common stock to be issued, if converted, would be equal to the unpaid principal amount and accrued and unpaid interest thereon divided by the closing price of our common stock on the date that is one day prior to such election. As of December 31, 2024, the Company has accrued $740 in interest that is included in other accrued expenses within the accompanying consolidated balance sheet.

Current wording

On November 18, 2024, we entered into an unsecured convertible promissory note (“Note Purchase Agreement”) with an accredited investor (“Investor”) for proceeds of up to $200,000 to be used for general corporate purposes. On December 4, 2024, the Company received $200,000 under the note purchase agreement and issued an unsecured convertible note bearing interest at a rate of 5% per annum that is due and payable upon closing a financing of at least $10.0 million or convertible into shares of common stock of the Company, at the sole discretion of the accredited investor. The number of shares of common stock to be issued, if converted, would be equal to the unpaid principal amount and accrued and unpaid interest thereon divided by the closing price of our common stock on the date that is one day prior to such election. As of December 31, 2025 and 2024, the Company has accrued $10,741 and $740, respectively, in interest that is included in other accrued expenses within the accompanying consolidated balance sheet.

Previous wording

Research and development expenses of approximately $184,000 for the year ended December 31, 2024 are primarily related to salaries and related costs for personnel in research and development functions totaling $176,000. The decrease in research and development expenses of approximately $252,000 for the year ended December 31, 2024 as compared to the same prior year period was primarily due to a (i) decrease in payroll and related costs of approximately $193,000 due to a reduced time commitment by certain employees, (ii) a decrease in share-based compensation expense of approximately $17,000 as the majority of share-based awards have been fully expensed in prior periods, (iii) a decrease in consulting fees of approximately $39,000 due to a lower time commitment by our independent contractors, and (iv) a decrease in technology license maintenance fees of $3,000.

Current wording

Research and development expenses of approximately $64,000 for the year ended December 31, 2025 are primarily related to salaries and related costs for personnel in research and development functions totaling $63,000. The decrease in research and development expenses of approximately $120,000 for the year ended December 31, 2025 as compared to the same prior year period was primarily due to a (i) decrease in payroll and related costs of approximately $113,000 due to a reduced time commitment by certain employees and (ii) a decrease in technology license maintenance fees of $7,000.

Previous wording

General and administrative expenses of approximately $696,000 for the year ended December 31, 2024 consist principally of salaries and related costs for personnel and consultants in executive and administrative functions of approximately $581,000, accounting and filing fees of approximately $63,000, director and officer insurance of approximately $35,000, investor and public relation fees of approximately $5,000, and other expenses of approximately $11,000. The decrease in general and administrative expenses of approximately $269,000 for the year ended December 31, 2024 as compared to the same prior year period was primarily due to (i) decrease in payroll and related costs of approximately $208,000 due to a reduced time commitment by certain employees, (ii) a decrease in legal fees of approximately $49,000, (iii) a decrease in director and officer insurance of approximately $8,000, and (vi) a decrease of $4,000 in other miscellaneous corporate expenses.

Current wording

General and administrative expenses of approximately $552,000 for the year ended December 31, 2025 consist principally of salaries and related costs for personnel and consultants in executive and administrative functions of approximately $438,000, accounting and filing fees of approximately $73,000, director and officer insurance of approximately $29,000, investor and public relation fees of approximately $3,000, and other expenses of approximately $9,000. The decrease in general and administrative expenses of approximately $144,000 for the year ended December 31, 2025 as compared to the same prior year period was primarily due to (i) decrease in payroll and related costs of approximately $143,000 due to a reduced time commitment by certain employees, (ii) a decrease in director and officer insurance of approximately $6,000, and (iii) a decrease of $5,000 in other miscellaneous corporate expenses offset by an increase in accounting and filing fees of $10,000.

Previous wording

On July 1, 2024, we entered into a Master Services Agreement with Oncotelic whereby we perform advisory and related services in connection with studies and projects. During the year ended December 31, 2024, we earned $42,000 for advisory and related services which is recorded in other income in the accompanying consolidated statements of operations.

Current wording

On July 1, 2024, we entered into a Master Services Agreement with Oncotelic whereby we perform advisory and related services in connection with studies and projects. During the years ended December 31, 2025 and 2024, we earned $14,000 and $42,000, respectively, for advisory and related services which is recorded in other income in the accompanying consolidated statements of operations. The Master Services Agreement expired effective February 28, 2025.

Previous wording

Interest expense of approximately $81,000 and $73,000 for the years ended December 31, 2024 and 2023, respectively, represents interest expense on convertible notes and loan payables.

Current wording

Interest expense of approximately $83,000 and $81,000 for the years ended December 31, 2025 and 2024, respectively, represents interest expense on convertible notes and loan payables.

Previous wording

Accretion to redemption value on convertible notes of approximately $1,000 and $16,000 for the years ended December 31, 2024 and 2023, respectively, pertains to the accretion of the convertible notes to their redemption value using the effective interest method. The Convertible Notes have been accreted to their full redemption value as of March 31, 2024.

Current wording

Accretion to redemption value on convertible notes of approximately $0 and $1,000 for the years ended December 31, 2025 and 2024, respectively, pertains to the accretion of the convertible notes to their redemption value using the effective interest method. The Convertible Notes have been accreted to their full redemption value as of March 31, 2024.

Previous wording

As of December 31, 2024, we had cash and cash equivalents of approximately $115,000. Our ability to continue our operations is highly dependent on our ability to raise capital to fund future operations. We anticipate, based on currently proposed plans and assumptions, that our cash on hand will not satisfy our operational and capital requirements through twelve months from the filing date of this Annual Report.

Current wording

As of December 31, 2025, we had cash and cash equivalents of approximately $4,000. Our ability to continue our operations is highly dependent on our ability to raise capital to fund future operations. We anticipate, based on currently proposed plans and assumptions, that our cash on hand will not satisfy our operational and capital requirements through twelve months from the filing date of this Annual Report.

Previous wording

On July 1, 2024, we entered into a Master Services Agreement with Oncotelic whereby we perform advisory and related services in connection with studies and projects. During the year ended December 31, 2024, we earned $42,000 for advisory and related services which is recorded in other income in the accompanying consolidated statements of operations.

Current wording

On July 1, 2024, we entered into a Master Services Agreement with Oncotelic whereby we perform advisory and related services in connection with studies and projects. During the years ended December 31, 2025 and 2024, we earned $14,000 and $42,000, respectively, for advisory and related services which is recorded in other income in the accompanying consolidated statements of operations. The Master Services Agreement expired effective February 28, 2025.

Previous wording

On November 18, 2024, we entered into an unsecured convertible promissory note (“Note Purchase Agreement”) with an accredited investor (“Investor”) for proceeds of up to $200,000 to be used for general corporate purposes. On December 4, 2024, the Company received $200,000 under the note purchase agreement and issued an unsecured convertible note bearing interest at a rate of 5% per annum that is due and payable upon closing a financing of at least $10.0 million or convertible into shares of common stock of the Company, at the sole discretion of the accredited investor. The number of shares of common stock to be issued, if converted, would be equal to the unpaid principal amount and accrued and unpaid interest thereon divided by the closing price of our common stock on the date that is one day prior to such election.

Current wording

On November 18, 2024, we entered into an unsecured convertible promissory note (“Note Purchase Agreement”) with an accredited investor (“Investor”) for proceeds of up to $200,000 to be used for general corporate purposes. On December 4, 2024, the Company received $200,000 under the note purchase agreement and issued an unsecured convertible note bearing interest at a rate of 5% per annum that is due and payable upon closing a financing of at least $10.0 million or convertible into shares of common stock of the Company, at the sole discretion of the accredited investor. The number of shares of common stock to be issued, if converted, would be equal to the unpaid principal amount and accrued and unpaid interest thereon divided by the closing price of our common stock on the date that is one day prior to such election. As of December 31, 2025 and 2024, the Company has accrued $10,741 and $740, respectively, in interest that is included in other accrued expenses within the accompanying consolidated balance sheet.

Previous wording

Net cash used in operating activities for the year ended December 31, 2023 consisted of our net loss of $1,008,235 combined with a decrease in the fair value of the derivative liability of $46,700 and a gain on redemption of preferred stock of Holocom of $433,000, which amounts were offset by (i) non-cash share-based compensation expense of $21,935, (ii) non-cash interest expense of $73,333, (iii) the accretion to redemption value on convertible notes of $15,842, and (iv) a net change in operating assets and liabilities of $879,358 primarily due to an increase in accrued compensation, accrued consulting, and other accrued expenses of $877,067, in aggregate.

Current wording

Net cash used in operating activities for the year ended December 31, 2025 consisted of our net loss of $687,846 offset by (i) non-cash interest expense of $73,332, and (ii) a net change in operating assets and liabilities of $503,117 primarily due to an increase in accrued compensation of $486,556, prepaid expenses of $10,332 and accrued payables of $8,310.