DPLS 10-K & 10-Q changes, risk factors and insider trading

On June 28, 2023, the High Court of Justice in the United Kingdom issued a winding-up order for the liquidation and winding up of the affairs of Optilan (UK) LimitedLimited. (“Optilan Liquidation”).Evelyn InPartners conjunctionLLP withcontinues to liquidate the order,company's the court appointed the Official Receiver’s Office (“OR”) to take the appointmentassets as liquidatorof the date of Optilanthis (UK) Limited and take control of Optilan (UK) Limited’s assets.filing.

On August 14, 2024, we entered into the EFA with GHS, as amended, pursuant to which GHS agreed to purchase up to $30,000,000 in shares of our Common Stock, from time to time over the course of 12 30 months (the “Contract Period”) after effectiveness of a registration statement on Form S-1 of the underlying shares shares of Common Stock.

Our independent registered public accounting firm reportreports (from two separate independent registered public accounting firms) on our audited financial statements for the years ended December 31, 20242025 and 20232024, indicateseach indicate that there are a number of factors that raise substantial risks about our ability to continue as a going concern. Such factors identified in the report are our accumulated deficit since inception, our failure to attain profitable operations, the excess of liabilities over assets, and our dependence upon obtaining adequate additional financing to pay our liabilities. If we are not able to continue as a going concern, investors could lose their investments.

We may be affected by fluctuations in currency exchange ratesrates.

There is currently no active public market for shares of our common stockstock, and one may never develop. Our common stock is quoted on the OTC Markets. The OTC Markets is a thinly traded market and lacks the liquidity of certain other public markets with which some investors may have more experience. We may not ever be able to satisfy the listing requirements for our common stock to be listed on a national securities exchange, which is often a more widely traded and liquid market. Some, but not all, of the factors which may delay or prevent the listing of our common stock on a more widely-traded and liquid market include the following: our stockholders’ equity may be insufficient; the market value of our outstanding securities may be too low; our net income from operations may be too low; our common stock may not be sufficiently widely held; we may not be able to secure market makers for our common stock; and we may fail to meet the rules and requirements mandated by the several exchanges and markets to have our common stock listed. Should we fail to satisfy the initial listing standards of the national exchanges, or our common stock is otherwise rejected for listing, and remains listed on the OTC Markets or is suspended from the OTC Markets, the trading price of our common stock could suffer and the trading market for our common stock may be less liquid and our common stock price may be subject to increased volatility, making it difficult or impossible to sell shares of our common stock.

July 24, 2024, we and GS Capital Partners, LLC entered into a Settlement Agreement pursuant to which the Company entered into a confession of judgment in favor of GS Capital in the amount of $2,673,423.19$2,673,423 which has been reduced to $1,950,123 (the “Balance”). UponAfter approval of the court on August 19, 2024, the Company will issue to GS Capital free-trading and unrestricted shares of Common Stock pursuant to drawdown requests in the amounts determined by GS Capital, subject to a 4.99% beneficial ownership limitation. The shares will be issued a price per share equal to the average of the three lowest VWAPs for the five prior trading days. GS Capital will be allowed to sell, the greater of (1) in one week, no more than 1% of the total outstanding shares of the Company on a non-cumulative basis at the “ask” price, and (2) 15% of the daily trading volume of the Common Stock on any single trading day. Each drawdown will reduce the Balance. The Company is required to reserve 2,500,000,000 shares of Common Stock.

Depending on the number of shares we issue pursuant to the Settlement Agreement, it could have a significant dilutive effect upon our existing shareholders. Although the number of shares that we may issue pursuant to the Settlement Agreement will vary based on our stock price (the higher our stock price, the less shares we have to issue), there may be a potential dilutive effect to our shareholders, based on different potential future stock prices, if issuances for the full amount of the Settlement Agreement are realized. As of April 14, 2025, 450,000,000 shares have been issued pursuant to the Settlement Agreement. Based on the threeestimated lowest VWAP’sVWAP of our Common Stock for the five prior trading days on April 14,10, 2025,2026, we would have to issue approximately 272,896,666196,982,121 shares of Common Stock to satisfy our remaining obligations.

The Company’s revenues are generated primarily from the sale of our services, which consist primarily of advanced technology solutions for integrated communications and security systems, as well as habitat management. The Company’s sales of products arewere primarily generated from our TJM subsidiaries.subsidiaries are now generated from the Company’s subsidiary Optilan India Pvt Ltd. Sales of products and services are separate from one another. At contract inception, we assess the goods and services promised in the contract with customers and identify a performance obligation for each. To determine the performance obligation, we consider all products and services promised in the contract regardless of whether they are explicitly stated or implied by customary business practices. The timing of satisfaction of the performance obligation is not subject to significant judgment. We measure revenue as the amount of consideration expected to be received in exchange for transferring goods and services. We recognize service revenues as the performance obligations are met, which is generally as milestones are satisfied over time. We generally recognize product revenues at the time of shipment, provided that all other revenue recognition criteria have been met.

Headquartered in New York, Arizona, DarkPulse is a globally-based technology company with presence through its subsidiaries in the,the United StatesStates, Canada, India and Canada.Turkey and UAE.. In addition to the Company’s BOTDA systems, through a series of strategic acquisitions the Company offers the manufacture, sale, installation, and monitoring of laser sensing systems, oil and gas pipeline leak detection, physical security services, telecommunications and satellite communications services, artificial intelligence-based camera systems, railway monitoring services, drone and rover systems, and Big Data as a Service (“BDaaS”). The Company is focused on expanding services through acquisitions and partnerships to address global infrastructure and critical environmental resource challenges.

DarkPulse offers a full suite of engineering and environmental solutions that provide safety and security infrastructure projects. The sensing and monitoring capabilities offered by DarkPulse operate in the air, land,land,and sea. OurWe believe our patented technology provides rapid, precise analysis to protect and safeguard oil and gas pipelines above or below ground, physical security countermeasures, mining operations, and other critical infrastructure/key resources subject to vulnerability or risk. Our patented dark-pulse based BOTDA distributed fiber sensing system is best in class. TheWe Company isare able to monitor areas in around critical infrastructure buried or above ground including pipelines 100km or more in length and/ or localized pipes as small as eight CMcm diameter, DIA, detecting internal anomalies before catastrophic failure. We are developing an intelligent rock bolt to prevent causalities and fatalities in mining operations and include a real time sensor system that can detect the location and movement of personnel and equipment throughout a mining operation. We monitor airflow, air quality, temperature, seismic events, etc. Our sensors cover extended areas, protecting an area from intrusion by detecting events at any location along the sensing cable. Working safely every day is our first core value and employees at DarkPulse and our subsidiary companies are recognized experts in their fields, providing comprehensive services for all our clients' needs.

Our subsidiaries consist of: DarkPulse UK Ltd,, a company headquartered in, United KingdomKingdom, DarkPulse Technologies FZCO located in UAE whose focus is in engineering, telecommunications, energy, rail, critical network infrastructure, pipeline integrity systems, renewables and security; Optilan India, PVT PVTLtd. located in Kilpauk, Chennai India and Optilan Communication & Security Systems, Ltd located in Ankara, Turkey providewhich provides project engineering & design, system provisioning and contract bid services globally and throughout Europe. TerraData Unmanned, PLLC, a company headquartered in Florida who custom manufactures NDAA compliant drones and unmanned ground crawlers to meet the needs of its customers; customers.

AsOur a result of the liquidation of Optilan, our current operations now include: DarkPulse, Inc., based in NewScottsdale, York City, New YorkArizona; DarkPulse Technologies FZCO, Dubai UAE;Terradata Unmanned PLLC, based in Florida; Optilan India Pvt Ltd based in Navi-Mumbai and Optilan Communications & Security Systems Ltd, based in Ankara Turkey. Remote Intelligence, LLC and Wildlife Specialists, LLC are no longer providing services as a result of redundant service offerings that are now being offered by TerraData Unmanned. DarkPulse Electronics Manufacturing Inc. (formerly TJM Electronics West, Inc.) is no longer providing products or services as a result of those products and services now being contracted through Sanmina Corp.Corp (NASDAQ:SANM).

We have recently completed development activities of our Gen. 3 dark-pulse BOTDA system and are pending a Purchase Order issuance to our contract manufacturer Sanmina Corp (NASDAQ: SANM) for full manufacturing of our patented BOTDA sensor system hardware. OnceWe wecurrently haveexpect obtainedto funding, we will be submittingsubmit a Purchase Order to Sanmina Corp.Corp during WeQ2 are2026, currentlysubject to the availability of sufficient working capital, completion of final engineering specifications, and other conditions. The Company previously anticipated submitting this Purchase Order in discussionsan withearlier period; however, the timeline has been extended as a lenderresult whoof mayongoing fundworking thecapital constraints and engineering specification requirements. There can be no assurance that we will submit such Purchase Order. We also may rely on proceeds of this offering to fund the Purchase Order. DependingOrder on the levelanticipated oftimeline, fundingor weat receive,all. weThis estimateexpectation constitutes a forward-looking statement subject to the initialcautionary factors described herein. The Company's ability to submit a Purchase Order willto beSanmina forCorp 10is directly dependent on its ability to 30secure additional working capital. As of December 31, 2025, the Company had $62,786 in cash and current liabilities exceeded units.current assets by $19,637,276. See "Liquidity and Capital Resources" and "Note 3 – Liquidity and Going Concern" for additional discussion of the Company's liquidity position. We base our claims related to the technologies capabilities from both experimental data obtained during the creation of the patent as well as real world POC deployments beginning in 2009 with most recent deployment in 2021. There are also papers submitted and published via IEEE and available online. The system components include: Patented patented hardware containing various electronic components and lasers.lasers, Proprietary proprietary software utilized to collect analog data and convert that data to digital data.data, Aand a user interface utilizing proprietary software as well as Unity game engine for the VR capability component of the User Interface. Deployment of the system begins with engineering design based on Scope requirements and installation environment. Fiber optic cable is then installed into the medium to be monitored. The system is then provisioned remotely by optical engineers.

Our agreement with the University of New Brunswick requires a royalty of 2% beginning April 24, 2018; however, no royalties have been paid to the University of New Brunswick as the period for royalties has expired prior to any sales of the patented technology. TheWe Company hashave no further requirement to pay royalties.

On April 28, 2023 we entered an Equity Financing Agreement, which was superseded by the Amended Equity Financing Agreement dated June 13, 2023, which was then superseded by the Second Amended Equity Financing Agreement dated July 10, 2023, which was then superseded by the ThridThird Amended Equity Financing Agreement dated August 14, 2024 as amended (the “EFA”), and Registration Rights Agreement (the “Registration Rights Agreement”) with GHS, pursuant to which GHS agreed to purchase up to $30,000,000 in shares of our Common Stock, from time to time over the course of 12 months after effectiveness of a registration statement on Form S-1 of the underlying shares of Common Stock.

As shown in the accompanying consolidated financial statements, we generated net losses of $ 3,893,859$2,925,582 and $21,723,043$3,893,859 during the years ended December 31, 20242025 and 2023, 2024, respectively, and net cash used in operating activities of $(1,514,35166,483) and $(5,653,2151,514,351), respectively. As of December 31, 2024,2025, the Company’s current liabilities exceeded its current assets by $17,160,706$19,721,196 and has an accumulated deficit of $71,259,677 . $74,226,493. As of December 31, 2024,2025, the Company had $86,531$62,786 of cash. Lastly, the Optilan Liquidation no longer raises serious concerns about the viability of the Optilan (UK) Limited entities. Optilan (UK) Limited and its subsidiaries have been deconsolidated and are no longer under the control of DarkPulse, Inc.

For the year ended December 31, 2025, total revenues were $308,492 compared to $126,836 for the year ended December 31, 2024, totalan revenues were $126,836 compared to $2,020,971 for the year ended December 31, 2023, a decreaseincrease of $1,894,135.$181,656. The decreaseincrease was primarily due torevenues thegenerated from Optilan liquidationIndia and noTerraData revenueUnmanned beingPLC. generated by Wildlife, Remote and TJM Electronics West, Inc given capital and resources restraints. The breakdown of revenues by entity for the years ended December 31, 20242025 and 2023 2024 is as follows:

Gross (loss) profit for the year ended December 31, 20242025 was $124,570$209,591 with a gross profit of 98%68% compared to $(425,785)$124,570 for the year ended December 31, 20232024 with a (21)%98% gross margin.

Selling, general and administrative expenses for year year ended December 31, 20242025 decreasedincreased by $1,562,273,$408,132, or 77%,87%, to $471,588$879,720 from $2,033,8612$471,588 for the year ended December 31, 2023.2024. The decreaseincrease primarily consisted of decreasesincreases in contractors, insuranceresearch and informationdevelopment technologyand expensesconsultant of operations that have been shuttered.fees.

Salaries, wages and payroll taxes for year ended December 31, 20242025 decreasedincreased by $1,805,595,$73,289, or 69%,9%, to $824,630$897,919 from $2,630,225$824,630 for the year ended December 31, 2023.2024. The decreaseincrease primarily consisted of reduceda headcountfull atyear each subsidiary. Furthermore, the Company reduced accruedof payroll whichfor itOptilan was determined was no longer payable.India.

Professional fees for the year ended December 31, 20242025 decreased by $2,592,916,$275,056, or 83%,53%, to $516,756$241,700 from $3,109,717$516,756 for the year ended December 31, 20232024 due to decreased auditlegal and professional legal fees in 2023.2025.

Depreciation and amortization for year ended December 31, 20242025 decreased by $394,658,$43,291, or 75%,34%, to $128,489$85,198 from $523,147$128,489 for the year ended December 31, 2023.2024. This decrease is primarily due to to the Optilan liquidation and sale of some subsidiary property, plant and equipment.

For the year ended December 31, 2024,2025, we had other expense of ($2,017,149$481,829) compared to other expense of ($803,740$2,017,149) in 2023.2024. The increasedecrease is primarily due to loss on equity investment of $1,500,000, $1,500,000, lower interest expense of $492,302 , offset by the increased expense in the change in fair market value of derivatives ($347,303) and loss on deconsolidationdisposal of assets of ($1,642,146$110,573) and a $1,484,799 gain on forgiveness of debt..

As of December 31, 2024,2025, we had cash of $86,531compared$62,786 compared to $11,912$86,531 as of December 31, 2023.2024. We currently do not have sufficient cash to fund our operations for the next 12 months and we will require working capital to complete development, testing and marketing of our products and to pay for ongoing operating expenses. We anticipate adding consultants for technology development and the corresponding operations of the Company, but this will not occur prior to obtaining additional capital. Management is currently in the process of looking for additional investors. Currently, loans from banks or other lending sources for lines of credit or similar short-term borrowings are not available to us. We have been able to raise working capital to fund operations through the issuances of convertible notes or obtained through the issuance of our restricted common stock. As of December 31, 2024,2025, our current liabilities exceeded our current assets by $17,160,706.$19,721,196.

During the year ended December 31, 2024,2025, net cash used in operating activities was $1,514,351$66,483 resulting from our net loss of $3,893,859,$2,925,582, partially offset by non-cash charges of $1,634,681$995,716 primarily driven by ourchange in fair market of derivatives, bad debt expense, gain on partial extinguishment of debt, gain on forgiveness of debt and loss on equity investment offset by Impairmentdisposal of goodwill and issuance of common stock for legal settlement. During the year ended December 31, 2023, net cash used in operating activities was $5,653,214 resulting from our net loss of $21,723,043, partially offset by non-cash charges of $15,517,077 primarily driven by our bad debt expense and goodwill impairment.asset.

During the year ended December 31, 2023,2025, we had net cash used in investing activities of $215,475, including a joint venture investment of $113,125, and purchase of property and equipment of $102,350.$0.

In determining the fair value of the reporting unit, management estimated the price that would be received to sell the reporting unit as a whole in an orderly transaction between market participants at the measurement date. This includes reviewing market comparables such as revenue multipliers and assigning certain assets and liabilities to the reporting units, such as the respective working capital deficits of each entity and debt obligations that would need to be assumed by a market participant buyer in an orderly transaction. The Company calculated the carrying amounts of the reporting unit by utilizing the entities’ assets and liabilities at MarchJune 31,30, 2026, including the carrying value of of the identifiable intangible assets and goodwill assigned to the respective reporting unit.

DarkPulse, Inc., a Delaware corporation (the “Company” or “DarkPulse”), is a technology company focused on the manufacture, sale, installation, and monitoring of laser sensingbased systems for critical infrastructure/key resources monitoring based on its patented BOTDA dark-pulse sensor technology.technologies and laser based systems for Aerospace & Defense utilizing a series of exclusive patents licensed to the company by the US Navy’s Naval Air Warfare Center Weapons Division and the United States Air Force. The Company develops, markets, and distributes a full suite of engineering, monitoring, installation and security management solutions for critical infrastructure/key resources to both industries and governments. CoupledRecently the company has entered the Aerospace & Defense industry with ouran patentedinitial BOTDAfocus on technology,laser-based DarkPulseweapons providestargeting its customers a comprehensive data stream of critical metrics for assessing the health and security of their infrastructure. Our systems provide rapid, precise analysis and responsive activities predetermined by the end-user customer.systems. The Company’s activities since inception have consisted of developing various solutions, solutions, obtaining patents and trademarks related to its technology, raising capital, acquisition of companies deemed to expand global operations operations and/or capabilities, creating key partnerships to expand our suite of products and services. Our activities have evolved to a sales-focused mission since the successful completion of our BOTDA system.

Headquartered in Scottsdale, Phoenix, Arizona, DarkPulse is a globally-based technology company with presence through its subsidiaries in the United States, Canada, India, Turkey, and the United Arab Emirates. In addition to the Company’s BOTDA systems, through a series of strategic acquisitions and patent licenses the Company offers the manufacture, sale, installation, and monitoring of laser sensing systems, oil and gas pipeline leak detection, physical security services, telecommunicationstelecommunications, defense and satellite communications services, artificial intelligence-based camera systems, railway monitoring services, drone and rover systems, and Big Data as a Service (“BDaaS”). The Company is focused on expanding services through acquisitions and partnerships to address global infrastructure and critical environmental resource challenges.

DarkPulse offers a full suite of engineering and environmental solutions that provide safety and security infrastructure projects. The sensing and monitoring capabilities offered by DarkPulse operate in the air, land, sea. We believe 0urour patented technology provides rapid, precise analysis to protect and safeguard oil and gas pipelines above or below ground, physical security countermeasures, mining operations, and other critical infrastructure/key resources subject to vulnerability or risk. Our patented dark-pulse based BOTDA distributed fiber sensing system is best in class. We are able to monitor areas in around critical infrastructure buried or above ground including pipelines 100km or more in length and/ or localized pipes as small as eight CM DIA, detecting internal anomalies before catastrophic failure. We are developing an intelligent rock bolt to prevent causalitiescasualties and fatalities in mining operations and include a real time sensor system that can detect the location and movement of personnel and equipment throughout a mining operation. We monitor airflow, air quality, temperature, seismic events, etc. Our sensors cover extended areas, protecting an area from intrusion by detecting events at any location along the sensing cable. Working safely every day is our first core value and employees at DarkPulse and our subsidiary companies are recognized experts in their fields, providing comprehensive services for all our clients' needs.

Our subsidiaries consist of: DarkPulse UK Ltd,, Ltd., a company headquartered in, in the United Kingdom,Kingdom; DarkPulse Technologies FZCO whose focus is in engineering, telecommunications, energy, rail, critical network infrastructure, pipeline integrity systems, renewables and security; Optilan India, PVT Ltd. located in Kilpauk, Chennai India and Optilan Communication & Security Systems, Ltd located in Ankara, Turkey which provides project engineering & design, system provisioning and contract bid services globally and throughout Europe. TerraData Unmanned, PLLC, a company headquartered in Florida who custom manufactures NDAA compliant drones and unmanned ground crawlers to meet the needs of its customers. customers.In addition, on July 13, 2026, the Company formed DarkPulse Aero LLC, a Delaware limited liability company and wholly owned subsidiary focused on the Company’s Aerospace & Defense initiatives.

As a result of the liquidation of Optilan, (UK) UK LtdLtd. our current operations now include: DarkPulse, Inc., based in Scottsdale,Phoenix, Arizona; DarkPulse Technologies FZCO in Dubai, UAE; ; Terradata Unmanned PLLC, based in Florida; Optilan India Pvt Ltd based in Navi-Mumbai and Optilan Communications & Security Systems Ltd, based in Ankara Turkey. Remote Intelligence, LLC and Wildlife Specialists, LLC are no longer providing services as a result of redundant service offerings that are now being offered by TerraData Unmanned. DarkPulse Manufacturing Inc. (formerly TJM Electronics West, Inc.) is no longer providing products or services as a result of those products and services now being contracted through Sanmina Corp (NASDAQ: SANM).

We have recently completed development activities of our Gen. 34 dark-pulse BOTDA system and are pending a Purchase Order issuance to our contract manufacturer Sanmina Corp for full manufacturing of our patented BOTDA sensor system hardware. We currently expect to submit a Purchase Order to Sanmina Corp during Q2the fourth quarter of 2026, subject to the availability of sufficient working capital, completion of final engineering specifications, and other conditions. There can be no assurance that we will submit such Purchase Order on the anticipated timeline, or at all. This expectation constitutes a forward-looking statement subject to the cautionary factors described herein. We base our claims related to the technologies capabilities from both experimental data obtained during the creation of the patent as well as real world POC deployments beginning in 2009 with most recent deployment in 2021. There are also papers submitted and published via IEEE and available online. The system components include: patented hardware containing various electronic components and lasers, proprietary software utilized to collect analog data and convert that data to digital data, and a user interface utilizing proprietary software as well as Unity game engine for the VR capability component of the User Interface. Deployment of the system begins with engineering design based on Scope requirements and installation environment. Fiber optic cable is then installed into the medium to be monitored. The system is then provisioned remotely by optical engineers.

Below is a table of all puts made by the Company under the EFA during the quarter ended MarchJune 31,30, 2026:

As shown in the accompanying financial statements, we generated net losses of $245,958$1,151,677 and $270,344$1,033,417 for the three-monthssix-months ended MarchJune 31,30, 2026 and 2025, respectively, and net cash provided (used in) in operating activities of $(340,593788,416) and $78,774,$494,513, respectively. As of MarchJune 31,30, 2026, the Company’s current liabilities exceeded exceeded its current assets by $19,692,440$20,047,874 and has an accumulated deficit of $74,471,258.$75,372,004. As of MarchJune 31,30, 2026, the Company had $53,371 $83,182 of cash. The Optilan (UK) Limited liquidation is ongoing; the Company is an unsecured creditor with approximately $19.4 million in intercompany payables due from Optilan (UK), which have been fully impaired. There can be no assurance that the Company will recover any portion of these amounts.

For the Three-Months Ended MarchJune 31,30, 2026 and 2025

For the three-months ended MarchJune 31,30, 2026, total revenues were $18,518$17,833 compared to $141,018$50,913 for the three-months ended MarchJune 31,30, 2025, a decrease] of $122,500.$33,080 . The decrease was due to lower revenues from Optilan India. The breakdown of revenues by entity for the three-months ended MarchJune 31,30, 2026 and 2025 is as follows:

For the three-months ended MarchJune 31,30, 2026, cost of revenues was $10,771$5,848 compared to $103,917$9,271 for the three-months ended MarchJune 31,30, 2025, a decrease of $93,146.$3,423. The decrease was attributable to lower revenue generation from Optilan India.

Gross profit for the three-months ended MarchJune 31,30, 2026 was $7,747$11,985 with a gross profitmargin of 42%67% compared to $37,101$41,642 for the three-months ended MarchJune 31,30, 2025 with a gross profitmargin of 26%.82%.

Selling, general and administrative expenses for the three-months ended MarchJune 31,30, 2026 decreased by $17,694$76,491 to $127,131$213,352 from $144,825$289,843 for the three-months ended endedJune March 31,30, 2025.

Salaries, wages and payroll payroll taxes for the three-months ended MarchJune 31,30, 2026 decreased to $226,251from$225,053 $237,005from $236,195 for the three-months ended MarchJune 31,30, 2025. The decrease was a result of a cumulative 2025 accrual adjustment.

Professional fees for the three-months ended MarchJune 31,30, 2026 decreased by $16,369$22,906 to $30,904$37,049 from $47,237$59,955 for the three-months ended MarchJune 31,30, 2025. The decrease is attributable to reduced legal and consulting fees Depreciation and amortization for the three-months ended March 31, 2026 decreased to $12,757 from $30,011 for the three-months ended March 31, 2025. The decrease is a result of disposition of certain assets.fees.

For the three-months ended MarchJune 31,30, 2026, we had other income of $147,572($429,493) compared to $151,669($199,175) during the three-months ended MarchJune 31,30, 2025. The variance is attributable to lowerhigher interest expense, change in fair market of derivatives and a gain on exceptional costs.derivatives.

As a result of the above, we reported a net loss of continuing operations of $245,958$905,719 and $270,344$2,416,706 for the three-months ended MarchJune 31,30, 2026 and 2025, respectively.

We require working capital to fund the continued development and commercialization of our proprietary fiber optic sensing devices, and for operating expenses. During the three-months ended March 31, 2026, we had $135,222 in cash proceeds from our equity financings compared to $439,370 in the three-months ended March 31, 2025.

As of MarchJune 31,30, 2026, we had cash of $53,371$83,182 compared to $107,785$102,134 as of MarchJune 31,30, 2025. We currently do not have sufficient cash to fund our operations for the the next 12 months and we will require working capital to complete development, testing and marketing of our products and to pay for ongoing operating expenses. We anticipate adding consultants for technology development and the corresponding operations of the Company, but this will not occur prior to obtaining additional capital. Management is currently in the process of looking for additional investors. Currently, loans from banks or other lending sources for lines of credit or similar short-term borrowings are not available to us. As of MarchJune 31,30, 2026, our current liabilities exceeded our current assets by $19,692,440.$20,047,874.

During the three-monthssix-months ended MarchJune 31,30, 2026, net net cash used in operating activities was $340,593$788,416 resulting from our net loss of $245,958,$1,151,677, partially offset by non-cash charges of ($83,658). $95,133. In 2025, we had net cash provided in operating activities of $78,774$494,513 resulting from our net loss of $270,344,$1,033,417, partially offset by non-cash non-cash charges of $236,326$337,912 primarily driven by our gain on forgiveness of debt and termination of lease.

During the three-monthssix-months ended MarchJune 31,30, 2026, we had net cash provided/(used) in investing activities of $0.($15,000).

During the three-monthssix-months ended MarchJune 31,30, 2025, we had net cash provided in investing activities of $19,675.$106,071.

During the three-monthssix-months ended MarchJune 31,30, 2026, net cash provided by financing activities was $111,880$622,641 which was primarily comprised of proceeds from the issuance of common stock of $135,222$577,136 and proceeds from convertible notes $50,000,$230,000, offset by repayments of loans payable.

During the three-monthssix-months ended MarchJune 31,30, 2025, net cash provided by financing activities was $318,481$463,262 which was primarily comprised of proceeds from the issuance of common stock of $439,370$837,044 offset by repayments of loans payable.payable of ($384,917).