UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 1-K

ANNUAL REPORT

PURSUANT TO REGULATION A OF THE SECURITIES ACT OF 1933

For the fiscal year ended December 31, 2024

RAD Technologies, Inc.

(Exact name of registrant as specified in its charter)

Commission File Number: 024-12513

5106982462

Registrant’s telephone number, including area code

Class B Common Stock

(Title of each class of securities issued pursuant to Regulation A)

As used in this report, unless the context otherwise requires, the terms “Corporation,” “Company”, “RAD Intel”, “RAD”, “we”, “our” and “us” refer to RAD Technologies, Inc.

THIS REPORT MAY CONTAIN FORWARD-LOOKING STATEMENTS AND INFORMATION RELATING TO, AMONG OTHER THINGS, THE COMPANY, ITS BUSINESS PLAN AND STRATEGY, AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF, ASSUMPTIONS MADE BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY’S MANAGEMENT. WHEN USED IN THE OFFERING MATERIALS, THE WORDS “ESTIMATE,” “PROJECT,” “BELIEVE,” “ANTICIPATE,” “INTEND,” “EXPECT” AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS, WHICH CONSTITUTE FORWARD LOOKING STATEMENTS. THESE STATEMENTS REFLECT MANAGEMENT’S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE COMPANY’S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-LOOKING STATEMENTS. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION TO REVISE OR UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER SUCH DATE OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS.

ITEM 1: BUSINESS

Company History

RAD Technologies, Inc. is a technology company incorporated on July 6, 2018 based on the thesis that content marketing, which includes influencer activations, is rampant with inefficient processes that drive bloated fee structures. Historically, the influencer marketing industry leveraged these difficulties to bill for more time.

RAD Intel aims to fix these difficulties by addressing the core issues clients care most about. Historically, brands and agencies had been plagued by bias when making important, often expensive content decisions. Biased decision-making leads inflated fee structures and guesswork that has made the entire marketing communications industry inefficient. RAD believes it has developed a technology which will fundamentally alter how digital marketing companies manage their workflow. We believe our technology will disrupt the entire influencer marketing industry, including how influencers are sourced, how their content is curated and matched to brand needs, and how data can enhance brand campaigns. RAD believes that this will ultimately lower costs and increase revenues for our agency and brand partners.

The first problem we solve is influencer discovery, which our product addresses by using our proprietary AI to analyze historical content patterns from a database of influencers, then matching these same influencers to a predetermined campaign. The second problem we address is to help clients understand their audience by delivering AI-informed personas. These personas tell our clients who their customer is, and what they care most about today. The third problem our AI solves is content optimization and ranking. This product evaluates and rates content made by any content creator to verify its alignment with the brand’s messaging and helps predict which piece of content will most deeply resonate with the audience.

In the past few years, we have been able to expand our operations and enter new client and enterprise partnerships, including:

Product Overview

The Company leverages advanced artificial intelligence techniques, including natural language processing and sentiment analysis, to streamline influencer marketing campaigns. Our technology platform analyzes vast datasets from various sources, such as social media, search engines, and online discussions, to:

At scale, we believe our software will disrupt the way current marketing campaigns select content to market their product/service to a target audience and have confidence that the campaign will generate a higher ROI than status quo methods (agencies)/software.

For influencer marketing on a campaign level, RAD’s end-to-end managed services model is grounded in efficiency and effectiveness. Through the use of our proprietary suite of AI tools, RAD is able to collapse the time required to identify new audiences, discover audience-centric influencers and optimize content, ultimately lowering the time, money, and effort required to go from client brief to in-market activation. Once the Clients’ goals and KPI’s have been established, scopes are developed with specific deliverables against a bottom-line all-in budget that covers agency services (strategy and campaign management) and influencer costs. We charge clients on a per campaign basis initially. After the first campaign they run either one-off campaigns on a continual basis or groups of campaigns at a reduced fee.

RAD Intel Persona Engine

The RAD Intel Audience Insights Engine is an AI-powered tool designed to assist marketers in understanding their target audience and optimizing influencer marketing campaigns. Key features include:

RAD Intel Content Optimization

The RAD Intel Content Optimization tool utilizes advanced machine learning techniques to:

RAD Intel Writing Engine

The RAD Intel Writing Engine is an AI-powered writing tool that helps users create and optimize content. Key features include:

Machine Learning Innovations

The Company utilizes innovative machine learning techniques to enhance the performance of its AI tools. Key innovations include:

TikTok Shop Commerce Growth

RAD AI empowers brands to maximize revenue, accelerate TikTok Shop success, and optimize influencer-driven sales using advanced AI technology. This new solution, which will launch in Q3 2025, eliminates guesswork by leveraging real-time data, AI-powered influencer matching, and in-campaign optimization to ensure higher conversions, lower costs, and scalable growth in the TikTok ecommerce ecosystem.

Fast-Track TikTok Shop Setup & Approval

Data-Backed Influencer & Live Streamer Selection

AI-Driven Full-Funnel Marketing Execution

Real-Time Campaign Optimization for Maximum ROI

Competitive Edge in TikTok Ecommerce

Why Brands Choose RAD AI

Value Proposition

For Content Creators

For Marketing Teams & Brands

The Future of Influencer Marketing is Fully Automated, Data-Driven, and Scalable.

With RAD AI, launch, manage, and optimize influencer and social-commerce campaigns with minimal manual work—maximizing ROI across every channel.

What’s Happening Behind the Scenes

RADs technology builds off of existing AI models by using its own models to undertake analysis, validation, and fine tuning. We do this because language and style are critical for content marketing, and base generative AI is not suited to this task.

RAD’s suite of models and algorithms within the products identified above represent a systematic and data-driven approach to understanding and optimizing influencer-audience dynamics, ensuring precise targeting and improved engagement outcomes:

The external models RAD currently utilizes include models that are more known, such as GPT and Gemini, but also more focused models, such as DeBERTa-3-base-mnli-fever-anli, Real-ESRGAN, and others. However, RAD is in a constant state of product development given the rapid and ongoing changes in the AI industry as a whole. We are continuing to explore advanced and newly created AI techniques to solve ongoing business challenges in the areas of audience insights, content optimization and predictive behavior. The current product represents the commercialization of some but not all of the research we have conducted to date. The end product will increase in functionality and sophistication representing the entirety of our research and the needs of the market in the areas where we focus.

We note that services like GPT and Gemini are used in limited functions for labelling support. The analysis of data is performed using our proprietary AI models, which is then put through these natural language AI services to provide responses back to the client in user friendly language. We utilize these tools when beneficial to the service we are delivering to our clients, but the Company is not reliant on any specific external model without which the Company would not be able to deliver our services.

Development Team

The RAD development infrastructure is divided into two core teams each containing three dedicated teams within each core team. The first team which builds state of the art ML is divided into a NLP team that is advancing linguistic models to support our advancements in Audience Segmentation, Data Labeling and large scale Information Clustering. The LLM is advancing our expertise in Large Language Models that are used for analysis of all forms of content in support of Audience Segmentation, Predictive Behaviour and Content Transformation. The last team in our ML universe is our Computer Visioning division, which focuses on novel inventions in the area of image and video analysis and tuning. In our current product iteration, we are using what we refer to as v1.0 where our models leverage foundational advancements in machine learning to analyze and segment audiences, measure metrics such as emotion, style, stance, sentiment and interests in relation to any form of social media text or media, and provide detailed insights into the construction of the above. It is also used to identify related influencers using novel AI models to replace human subjectivity.

Our second core team consists of dev ops, front end and back end. These teams bring the ML models to the forefront of the product in the form of an elegant user interface, they create API apps to extract information from our ML models into usable and storable data streams for the front end, manage our cloud infrastructure, optimize our infrastructure for run-time and performance and manage our integrations into to third party applications.

The focus of our current development roadmap which will run through to the end of 2024 is on enhancements to our audience segmentation engine which include expanded data sets, integration of our LLMs for audience identification, style transformation which automates the transference of text or media from one style of voice to another (i.e. scientific to humorous), v2.0 of our media ranking models which will allow for tuning of images for a particular audience segment, expanded video formats to include long and short videos and a robust compliance engine.

Software as a Service Business Model

Our SaaS-focused business model is designed to attract and retain enterprise clients and expand their contracts through multi-year commitments.

This model has two pillars depending on the type of client we are working with.

Marketers/Brands Clients

RAD Intel’s platform usage model is different from a traditional Seats/SaaS model. RAD has structured its pricing model for marketers around a tiered number of bundled or unbundled solutions across the three core three AI-informed offerings: (1) Audience identification; (2) Influencer discovery; and (3) Content optimization. This allows for bespoke packages to be created for each client based on their size and needs. These Marketer/Brands typically receive “view only” access to the platform.

Agency/Internal Agency Clients

Larger marketing services agencies and/or marketers/brands that have ‘in-housed’ their influencer marketing capabilities lean towards using their own procurement to negotiate and activate their influencer programming. For these types of clients, RAD provides “hands-on-keyboards” platform access, supported by a customer success/strategy team and training. The bespoke bundle model is then implemented based on the size and needs of the clients.

RAD’s multi-faceted capabilities are reshaping the influencer marketing landscape with the power of proprietary AI. This category disruption is serving as a valuable entry point into the enterprise organizations that will benefit from the broader value our AI technology delivers. Here is how our AI works in context:

Audience Segmentation: Using our proprietary AI and several other proprietary models, we conduct an extensive analysis of posts, comments, and replies across Reddit, X, and TikTok focusing on sentiment, emotion, stance, and relevance concerning your brand, product, or service. Subsequently, our proprietary AI model comes into play, precisely identifying the primary and secondary interests of the target audience. We then segment further into like-minded groups, providing the client with a fresh perspective on your audience, paving the way for exceptional messaging and targeting strategies.

Influencer Discovery and Identification: Through our AI algorithms, we process extensive data from social media platforms and various online resources, effectively pinpointing potential influencers who resonate with a brand’s target audience and values. This automated approach saves considerable time and effort when compared to current practice of manual searching, and still ensures precise matches. Furthermore, our AI delves into the content composition, performance, follower behavior, and key metrics of diverse influencers to identify the perfect candidates tailored to the client’s campaign. As a result, we curate the most accurate and authentic influencer pool for the program, delivering best-in-class results. This is the foundation to begin to formulate content strategies that go beyond influencer programs and can be applied to the full funnel.

Campaign Personalization: Unique to RAD, our audience analysis revolves around segmenting audiences based on their primary and secondary interests. This approach empowers the development of highly personalized and customized strategies that perfectly align with the distinct preferences and behaviors of each target audience. By achieving this level of customization, campaign effectiveness is significantly enhanced, leading to an elevated overall user experience.

Content Optimization/ Media Ranking: RAD evaluates and rates the content shared by influencers to verify its alignment with the brand’s messaging, accurately predicting which pieces will most deeply resonate with the audience. This meticulous analysis significantly enhances the impact and relevance of influencer marketing. Our model incorporates exclusive features that thoroughly analyze images and videos for emotion, memorability, sentiment, and other essential elements of predictive performance with precision.

Performance Analytics: With RAD’s AI-driven analytics, marketers can gain access to valuable insights in real-time. Unlike merely measuring performance metrics, RAD’s AI goes a step further, interpreting data to unveil the underlying reasons behind the results. This advanced approach shows in-depth insights that go beyond mere engagement, reach, and conversions, providing answers to critical, strategic questions and enabling accurate ROI reporting. This gives us the ability to go beyond the necessary measuring of performance against tactical objectives and is able to also measure performance against overall business objectives/statistics. The AI provides unique insights, which are a significant improvement over current offerings in the market.

Predictive Modeling: Designed with a continuous machine learning feedback loop, RAD continually predicts potential (customer) outcomes by analyzing historical and real-time data. This empowers brands to make well-informed decisions, optimize their strategies, and achieve enhanced results. This creates opportunistic and cultural content discovery which can be leveraged in ways that break the feed and bring cultural credibility to a brand.

Automated Influencer Management: RAD streamlines the influencer relationship management process by automating communication, tracking deliverables (project management), and facilitating contracts, thereby improving overall efficiency.

Intellectual Property

RAD is the first to leverage audience interests mined from online communities to build audience persona models. Using novel natural language processing (NLP) models advanced through RAD Intel’s proprietary research, our expertise resides in our ability to deconstruct every aspect of media (video, image, text) to understand the intended inference of emotion, sentiment, stance, meaning, topic and interest, and correlate that information to predictive engagement. Our AI models cluster communications based on these attributes into like-minded communities and use their interests to describe who they are and how they form these communities. We then overlay demographic data to complete the description of the community.

Additionally, RAD ranks and diagnoses media according to the preferences of each community thereby creating the ability to explain to the media creator what attributes of the media need to be changed in order for it to resonate with the target audience. RAD has engaged the legal expertise of Norton Rose to assist it in managing its IP portfolio. To date, the position of our counsel is to maintain our trade secrets by not filing IP patents and not sharing details of our research breakthroughs to the public.

Partner Relationships

As part of our efforts to obtain clients, we have developed partner relationships with industry leaders like Omnicom and Hasbro alongside specialized relationships with companies like Adobe. Partnerships with leaders like Omnicom provide unparalleled access to the largest enterprises in the world and thus expose our AI technology to broader markets that it would otherwise take years to forge. On the other hand, having brand direct relationships with holding companies like Hasbro provide the necessary validation other enterprise client prospects require during our sales process.

Furthermore, having forged specialized relationships with industry leaders like Adobe helps to improve our AI technology feature sets and functionality. In turn, these enhanced feature sets benefit enterprise partners like Omnicom and Hasbro. These partnerships are of significant benefit to RAD Intel, as they expand the reach and existing network of the company, enhance the existing reputation of our work within the industry, and help to increase the value of our existing contracts.

Omnicom Partnership

In November 2023, RAD INTEL entered into a Test Learn Validate strategic partnership with OMNICOM, one of the world’s largest marketing communications networks. This engagement was designed to allow multiple OMNICOM agency teams to explore the capabilities of RAD INTEL’s proprietary platform for identifying audiences, analyzing influencer impact, and evaluating content performance.

Throughout the Test Learn Validate phase, RAD INTEL provided comprehensive training and ongoing platform supervision to ensure successful onboarding and adoption across the engaged agency teams. During this stage, we also co-developed new features and custom workflows tailored to OMNICOM’s operational needs—several of which have since been implemented at flagship agencies within their network.

The partnership was renewed twice—first in March 2024 and again in September 2024—transitioning the engagement from a pilot into a commercial agreement. As of 2025, RAD INTEL’s platform is an approved offering within OMNICOM’s tool stack, enabling their agencies to bill clients for services powered by our technology.

Our platform has been deployed on behalf of numerous OMNICOM client brands, including Nissan, T-Mobile, P&G, Gilead HIV, NYX / L’Oréal, and The Carter Center, among others. Additionally, RAD INTEL was used in major cross-agency new business pitches, such as for P&G, serving as a key innovation differentiator.

We believe this partnership represents a meaningful validation of RAD INTEL’s enterprise value and a strong signal of market demand for our solution at scale.

Hasbro Client Relationship

In 2023, RAD engaged with Hasbro to run two test campaigns, Hero Quest and Risk games respectively. The success of the first two campaigns produced a third campaign, which ran in Q1 2024 and also produced an RFP for a 4^th campaign that was confirmed and ran in Q3 of 2024. Beyond that, a 5^th campaign was run during Q3 of 2024. Furthermore, Hasbro has submitted budget approval for $2M in spend across 6 brands for 2025 which was also approved in Q4 of 2024. This new contract is an annual contract utilizing the RAD Intel solution.

Furthermore, Hasbro, our client, has submitted budget approval for an annual contract which will utilize the RAD solution across the broader group of the Hasbro family of brands.

The benefits of this client partnership is:

Adobe Relationship

In 2023, RAD was selected to be the participant of the Adobe Fund for Design Grant. The grant funds and promotes our continued innovation for content optimization through a unique add-on RAD built specifically for the Adobe Express marketplace.

The add-on RAD built for Adobe Express helps guide content creation across photos for web and social channels. Our AI and media optimization engine scores each visual based on a variety of features, including emotion, sentiment, and clarity, giving you immediate, predictive insights on how your media will perform with your target audience and across socials.

This benefits our clients by:

Atomic Reach Acquisition

In 2021, RAD undertook an acquisition of Atomic Reach, bringing its former CEO, Bradley Silver, on to serve as the RAD President and Head of Technology. Atomic Reach has developed an artificial intelligence platform with a specialization in AI that influences behavior and outcomes through language. The company, with over $21 million invested, had developed state of the art AI technology, but struggled with product market fit.

Post-acquisition, RAD navigated through strategic decisions, focusing on which marketing technology sector to disrupt with our newly-acquired AI. RAD’s CEO, Jeremy Barnett’s previous experience in co-founding and eventually exiting a fashion technology company, Trendy Butler, in 2017, shed light on the palpable issues within influencer marketing and content creation. Thus, RAD Intel anchored its focus on influencer marketing — a sector ready for disruption and with accessible campaigns and budgets.

Today, both teams have successfully integrated and thus, repositioned the Atomic Reach product offering. To date, the acquisition has proven to be beneficial for internal and external stakeholders, clients and investors.

Here’s how the Atomic Reach acquisition has created value:

Potential Acquisition Targets

The Company believes that further growth and scale may be achieved through acquisitions of complimentary service providers. While there are no definitive agreements or actions that would make an acquisition more probable than not as of the date of this Annual Report, the Company has begun conversations with potential acquisition targets.

The following discussion illustrates at a high-level the types of targets the Company is looking at and believes would be complimentary to its service offerings:

Target 1

Target 2

Target 3

Target 4

Target 5

As noted above, conversations with these targets are preliminary and no definitive agreements are in place.

Market

The addressable creative intelligence market is potentially sizeable and consists of the following segments:

Social media management solutions are among the leading choices for raising a company’s brand recognition, driving inbound traffic, improving customer happiness, and increasing conversion rates. Businesses are adopting social media platforms to operate successfully in the economy and build a social media presence to attract new prospective consumers.

Adobe, IBM, Google LLC, Oracle Corp., Salesforce.com, Hubspot Inc., and Zoho Corp. Pvt. Ltd. are some examples of large enterprises who compete in this space.

The social media management market growth is driven by the rising widespread penetration of social media and rising focus on market and competitive intelligence. The key future trend is continued improvement of internet technologies and the roll out of 5G.

Digital advertising is essential to advertisers and businesses for many reasons including but not limited to:

SEO solutions and services help boost the number of visitors to a website with organic search results, such as Bing and Google. Some SEO elements, such as backlink building, keyword analysis, and content creation, have become a leading force in the industry. For instance, building backlinks have become instrumental in enhancing credibility. SEO has become invaluable for businesses to provide a competitive edge. Companies are investing in the tools that assess strengths and weaknesses.

The global market is segmented into freelancers’ SEO services and agency SEO services. Stakeholders anticipate the SEO agency to exhibit noticeable growth as it helps companies boost web visibility. SEO agencies have also demonstrated traction for smart speakers and AI among others. The expanding application of AI with automation would allow companies to introduce innovative strategies to build content.

Big data analytics examines structured and unstructured databases to understand and deliver insights based on correlation, hidden patterns, varying market trends, and more. Prominent sectors aim to employ analytical tools to obtain customer insights by developing business intelligence.

For instance, in December 2020, Amazon, Inc. launched Amazon HealthLake, a HIPPA-compliant big data analytics service for the healthcare industry that provides real-time patient data.

Adoption of AI-driven advanced reporting is changing the landscape. During and after COVID, businesses have been investing in systems to implement advanced analytics to understand emerging trends. Globally, businesses have accelerated their digital transformation strategy.

The marketing automation industry has seen significant growth in recent years, driven by a growing need for businesses to improve their marketing efficiency and effectiveness. One of the main drivers of this growth is the increasing adoption of automation by small and medium-sized businesses. These companies are using marketing automation tools to help them compete more effectively with larger enterprises. Additionally, with the rise of e-commerce and digital marketing, businesses are also looking for ways to automate and streamline their digital marketing efforts, which is driving demand for new tools.

The rising trend of organizations to optimize spending on marketing is creating high demand for marketing automation in recent years. As organizations look to optimize spending in marketing, they are increasingly turning to marketing automation tools to help them streamline and measure their marketing efforts. These tools allow organizations to automate repetitive tasks, such as email campaigns and social media posts, and to track the performance of their marketing campaigns in real-time. By using automation, organizations can save time and money by reducing the need for manual labor, while also being able to target and engage with their customers more effectively.

Additionally, automation helps organizations to meet their Return on Investment (ROI) more easily. This increased efficiency and effectiveness can lead to increased revenue growth for the organization, as well as for the marketing automation market.

Influencer marketing is a collaboration between popular social media users and brands to promote the brand’s products or services. These partnerships have been going on since the dawn of social media.

Authenticity is the basis of success for any influencer marketing campaign. Forming relationships with influencers who are already relevant to a brand’s message is vital. Influencers might be popular for their content on sustainability, cooking, body positivity, healthy lifestyle, and so on. Influencer marketing is more about building real relationships with creators than scoring social media posts that endorse products or services.

Since the COVID-19 pandemic, consumers are shopping online more frequently. During COVID consumers realized that they could safely and efficiently rely on e-commerce. This pattern has continued post pandemic. During this time, influencers played an even greater role.

Another new dimension that is influencing the space is the Metaverse. It can be commonly described as an emerging 3-D digital space that allows consumers to have lifelike experiences online via virtual reality and other technologies. In the metaverse, people interact with peers, content, cryptocurrency, brands, etc.

In the Metaverse, people are willing to pay for virtual goods and services: direct to avatar sales. Consulting giant McKinsey estimates the current market for such goods and services to be approximately $54bn. Some examples of goods that sell in the marketplace include Nike virtual sneakers, and Chipotle (real-life) burritos that were offered to the first 30,000 visitors to the Company’s virtual store on Roblox.

Influencer marketing is becoming more of a widespread marketing strategy as digital technologies continue to evolve and attract users.

The growing adoption of digital technology tools is likely to set the pace for digital transformation and digital optimization of both new and existing businesses. Company departments such as sales & marketing and customer service & support are increasingly integrating Customer Relationship Management (CRM) systems with AI to improve customer experience and feedback and to develop stronger bonds with customers.

As an example, in 2022, Salesforce, Inc., a cloud-based software company, launched CRM analytics with new capabilities such as AI-powered insights for sales, marketing, and service teams for every industry, such as retail, IT, Telecommunications, etc.

Developments within CRM analytics will likely boost the growth of the market. Customers’ increasing use of digital channels to communicate with brands and organizations is anticipated to drive customer relationships and the CRM industry via sales reporting and process automation.

With the growing importance of understanding customer behavior and their preferences, organizations are adopting CRM strategies to deliver the best performance in real-time to stay competitive. Rapid shifts in the fields of business intelligence and embedded analytics, the Internet of Things (IoT), and AI, and their implementation in CRM solutions are likely to promote product development and innovation among CRM vendors.

Sales & Marketing

Working with recognizable corporations is helping us build our brand recognition that will help us grow our client portfolio. We also have a structured salesforce in house that we plan to grow proportionally with revenue. We are also leveraging partnerships and other creative methods to cost-effectively market our company. We have been featured in high-volume publications such as Time Magazine, Forbes, and VanityFair. This further brings us exposure. After raising this round of financing, we plan to strategically invest in marketing to scale even faster.

Competition

RAD’s main competitors are:

RAD believes that its main differentiation is that our product delivers more specific results than its competitors and therefore generates more value for the customer.

We have focused our resources on R&D and have developed unique expertise in coding NLP AI. Our team has over a decade of experience. This has resulted in a sentiment analysis engine that surpasses our competitors and serves as the fundamental building block for our best-in-class influencer marketing solutions.

Our AI automation is transformative to enterprises using influencer marketing campaigns to drive sales. Our application creates otherwise unachievable executional efficiencies by eliminating guesswork and delivers quantifiable results.

Our AI automation is disruptive because it drastically reduces marketing operations costs, increases margin, and produces demonstrable and otherwise unattainable value to customers.

Customers

Our current customers range from large legacy brands to growth companies and include but are not limited to Sweetgreen, THE BLK TUX, MGM Resorts, NCM National Cinemedia, ro, Dignity Health, Splinterlands, Accenture, Fisker, Bright Horizons, MIKEWORLDWIDE and Since Tomorrow.

We are actively pursuing additional customers with recognizable brand names.

Legal

We are not aware of any pending or threatened legal actions that we believe would have a material impact on our business.

Employees

The Company currently has six part-time employees and fifteen full-time employees. As a part of our capital raise, we plan to initially hire a number of employees to assist in the deployment and scaling of our platform. As we continue to develop our technology we will also scale up our technical staff with the ultimate goal of creating a self-serve platform.

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements for the years ended December 31, 2024 and 2023 and the related notes included in this Annual Report. The following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements.

Operating Results

For The Fiscal Years Ended December 31, 2024 and 2023

For the fiscal year ended December 31, 2024, the Company had revenues of $1,151,637 compared to the year ended December 31, 2023, when the Company had revenues of $506,686, representing a 127.3% increase related to the Company’s increase in sales. This increase in sales was driven by the Company increasing the amount it spent on sales and marketing including hires to its sales team, which resulted in a greater volume of work and customers, including the partnership with Omnicom, leading to increased revenues. The Company’s cost of revenues increased from $1,430,575 in 2023 to $1,569,483 in 2024, representing a total increase of 9.7%. Cost of revenues in 2024 primarily consisted of amortization costs, which totaled $1,216,322, the same total as 2023. These costs were entirely related to $6,081,610 in intangible assets that were acquired pursuant to the merger with Atomic Reach in 2021. These costs, which have been identified as developed technology, are being amortized equally over a five-year period. The remaining costs of revenue mostly encompassed $279,483 in expenses paid out for advertising to influencers that the company partnered with. This was an 35.7% increase from 2023, where influencer expenses amounted to $205,948. The Company’s gross margin was -36.3% in fiscal year 2024, compared to -182.3% in 2023. The improvement in gross margin was due to an increase in business and subsequent revenue along with a decrease in the cost of revenues relative to net revenue. The drop in cost of revenues can be attributed to lower expenses for influencer services, as well as lower total costs for media channels.

In 2024, the Company recognized $7,881,756 in operating expenses, as compared to $4,304,778 in operating expenses for 2023, representing a 83.1% increase. General and administrative expenses, which consisted largely of payroll and business services, were the biggest driver of this increase as the company’s volume of business grew, with the total growing from $2,369,863 in 2023 to $3,627,762 in 2024, amounting to a 53.1% increase. The Company also increased its sales and marketing costs from $1,061,187 in 2023 to $2,947,127 in 2024, totaling an increase of 177.7%. This change was due to the Company’s efforts to continue to expand its client base and increase the volume of its business, which is part of the larger strategy to establish a more significant foothold within the industry. Additional increases in sales and marketing expenses were related to efforts to market the Company’s fundraises. Research and development costs increased from $873,728 to $1,306,867, representing a 49.6% increase. The increase in research and development were related to new hires focused on enhancing the Company’s software and technology. The overall increase in operational expenses can be attributed to the Company’s goals of increasing its market footprint and scaling up their operational capacity.

In addition to the above, the Company recognized net other expenses of $239,868 in the fiscal year ending in 2024, compared to $210,827 in the fiscal year ending in 2023, which was a 13.8% increase over this period. Of the expenses recognized, the biggest driver of this was the change in fair value of convertible notes, which amounted to an expense of $14,237 in 2024 but nothing in 2023.

As a result of the foregoing, the Company realized a net loss from continuing operations of $8,539,470 for the fiscal year ending December 31, 2024 – a 57.0% increase in net loss from continuing operations compared to a net loss from continuing operations of $5,439,494 during the fiscal year ending December 31, 2023.

Liquidity and Capital Resources

As of December 31, 2024, the Company had $277,938 in cash, compared to a total of $354,783 cash as of December 31, 2023. To date, the Company has not generated net income, and over the past two years has operated under losses. As of December 31, 2024, the Company had accumulated a deficit of $35,869,007. To date, the Company has been capitalized by equity investments from its shareholders, a convertible note, and revenues generated from its operations.

Recent Offerings of Securities

In the past year, the Company has undertaken multiple offerings pursuant to Regulation CF and Rule 506(c) of Regulation D to finance its operations. The Regulation CF offerings ran sequentially, while the Regulation D offerings partially overlapped with other Regulation D offerings and the Regulation CF offerings.

The following is a summary of offerings of securities made since January 1, 2024:

Going forward, the Company plans to rely on various equity crowdfunding efforts to sustain operating losses until it can reach profitability. The Company has access to potential debt and lines of credit and it can also access additional equity capital through its existing shareholder base and network. The Company expects to continue needing the assistance of outside capital, whether via debt or equity, later this year as it grows its revenue, customer base and operating expenses.

Debt

The Company obtained an Economic Injury Disaster (EIDL) loan for $250,000 on April 10, 2020, and on August 16, 2021 the Company obtained a second loan in the amount of $250,000.

The EIDL is a low interest, fixed-rate, long term loan obtained directly from the U.S. Small Business administration (SBA) to help overcome the effects of the pandemic by providing working capital to meet operating expenses. The loan bears interest at a rate of 3.75% per annum and matures 30 years from the date of the loan. The loan is secured by the assets of the Company. As of December 31, 2024 and 2023, the principal outstanding of the loan was $500,000. During the years ended December 31, 2024 and 2023, the Company made payments of $19,573 and $25,750, respectively, of accrued interest. Accrued interest on the loan as of December 31, 2024 and 2023, amounted to $31,192 and $31,964. Interest expense for the years ended December 31, 2024 and 2023 was $18,801 and $18,750, respectively.

The Company entered into a $500,000 with a related party on October 17, 2022. Unless earlier retired or converted, the outstanding balance of this note will be due and payable by the Company at any time on or after October 16, 2028 (the “Maturity Date”) at the Company’s election or upon demand by the Holder. The note is secured by all assets of the Company. As of December 31, 2024 and 2023, the fair value of the convertible notes was $513,135 and $426,606, respectively. See “Interest of Management and Others in Certain Transactions” below for more information.

Plan of Operations

While the Company has generated revenues since inception, it has been unable to show consistent profit or net income since inception. The Company continues to focus on business development to grow its customer base and product development to expand its product offerings, with the goal of growing top line revenue over the coming months and years. Previous capital raised by the Company has enabled it to sustain operating losses while also growing its employee base and expand its pool of paying customers. The Company anticipates continued operating losses in the coming 12-18 months as it focuses on customer growth.

The Company intends to make strategic acquisitions over the coming 6-12 months as a part of its growth strategy. These acquisitions will likely include the Company acquiring 100% of a target’s assets and operations, likely in the form of cash and stock. Potential targets will likely be small to medium sized agencies that focus on the creator economy, but that the lack technology and AI capabilities to properly optimize and grow their businesses.

When reviewing potential acquisition targets, the Company plans to look for the following:

The purpose of these acquisitions would be to further the Company’s business, both in the form of acquiring new customers, acquiring more employees, and/or acquiring new technology. As of the date of this Annual Report, no definitive arrangements are in place with any acquisition targets.

The Company anticipates that it will need to continue to raise capital over the next 6-12 months in order to continue with the aforementioned plan of operations.

Trend Information

We began product development by building an AI-based creative intelligence which leverages AI personas to connect trusted influencers (content creators) with brands that benefit from the influencer’s authentic, unbiased, informative and culturally relevant content.

Over the next few years we will be focused on building a self-serve, multi-workflow process enabled platform that will create a competitive advantage that we plan to use to “disrupt” the creative marketing industry. We also have a robust acquisition and roll up strategy to accelerate growth, content and distribution.

For instance, during 2025 and beyond, we anticipate increased gross revenues resulting from our customer acquisition strategy and potential client activations.

ITEM 3: DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES

Jeremy Barnett, Chief Executive Officer

Jeremy Barnett, CEO and co-founder is a 3x startup founder with 2 exits, including Trendy Butler (fashion tech). Jeremy has successfully led companies and raised capital with institutional investors such as Fidelity Investments, SOS Ventures, Expert Dojo, and more. He has experience building companies from 0-100+ employees. Mr. Barnett has served as CEO for RAD since the company was founded in March, 2018.

Bradley Silver, President

Bradley Silver, President and co-founder is also a 3x startup founder with 2 exits including Brand Protect. He has extensive experience raising capital and has worked with investors such as Fidelity Investments, GenWealth Ventures, MaRS AF, Brigus Capital, and Greybrook. He has experience scaling companies to $30m+ in annual recurring revenue. Mr. Silver has been with RAD since June, 2021. Prior to that he served as the CEO of Atomic reach from November, 2010 until October 2021.

Aaron Kuntz, Director

Aaron Kuntz, Director, is a lifelong entrepreneur, investor and advisor for several growth stage start-ups. He has been an early stage investor in industries like artificial intelligence, real estate, e-commerce, hospitality and food and beverage. Apart from RAD AI, Aaron is the president and owner of Consumer Credit Marketing, Inc., a marketing services company catering to consumer financial industries, a role in which he has been serving since 2008. Mr. Kuntz has been with RAD since February, 2018.

Joseph Freedman, Chairman

Joe Freedman, co-founder and chairman, is a private equity investor and corporate director with more than 25 years of industry experience. His most recent experience includes 18 years at Brookfield Asset Management, one of the world’s leading private equity and alternative asset management firms. Now retired from Brookfield, Mr. Freedman is a director of several private and public companies and non-profit organizations including Bridgemarq Real Estate Services (TSX:BRE) and the Canadian Civil Liberties Association. Mr. Freedman has served on the board of RAD since August, 2021. Prior to that, he served as the chairman for Make Space Inc. starting in March 2016, which is a role he still holds.

Orin Litman, Director

Orin is currently the Founder and Chairman and VetStrategy. Orin founded the Company in 2006 and served as its Chief Executive Officer from 2006 to 2023. Orin serves on the boards of many companies, including RAD, Vetster, and AmeriVet Veterinary Partners. Orin holds an MBA from the Ivey Business School at Western University.

COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS

For the year ended December 31, 2024, the Company compensated its executive officers and directors as follows:

ITEM 4: SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS

The following information on the security ownership of management and others is as of December 31, 2024:

ITEM 5: INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS

The Company entered into a $500,000 (“Principal Amount”) convertible note (“Note”) with a Director, Joseph Freedman (“Holder”) on October 17, 2022 (“Issuance Date”). Unless earlier retired or converted into Conversion Shares (as defined below), the outstanding balance of this Note will be due and payable by the Company at any time on or after October 16, 2028 (the “Maturity Date”) at the Company’s election or upon demand by the Holder. The note is secured by all assets of the Company.

The Company may satisfy this Note in full by repaying the Principal Amount at any time within 12 months from the Date of Issuance; by repaying 130% of the Principal Amount at any time after 12 months from the Date of Issuance and prior to 24 months from the Date of Issuance: by repaying 160% of the Principal Amount at any time after 24 months from the Date of Issuance and prior to 36 months from the Date of Issuance; or, by repaying 200% of the Principal Amount at any time after 36 months from the Date of Issuance. The Holder may accelerate the payment of this Note at any time after 24 months from the Date of Issuance and require the Company satisfy the Note in full by repaying the Principal Amount. The repayment amount effective as of December 31, 2024 and 2023 was $800,000 and $650,000, respectively. During the years ended December 31, 2024 and 2023, the Company incurred $150,000 and $150,000 of interest expense, respectively, in connection with this Note. $300,000 and $150,000 of interest was accrued and outstanding at December 31, 2024 and 2023, respectively.

At any time on or after the date of issuance, at the election of the Holder, the Note will convert into that number of Common Shares equal to the quotient (rounded down to the nearest whole share) obtained by dividing the outstanding principal balance of this note on the date of such conversion by the applicable Conversion Price. Conversion Price means (rounded to the nearest 1/10th of one cent) the lower of: (i) the product of 100% less the discount of 20% and (y) the lowest per share purchase price of the equity securities issued in the next equity financing; and (ii) the lowest per share purchase price of the equity securities issued in the Crowd Funding Financing. Crowd Funding Financing means the sale (or series of related sales) by the Company of its equity securities through the WeFunder crowd funding platform which was launched in 2022.

In connection with the convertible notes, the Company granted an aggregate of 19,850,818 warrants to the holder with an exercise price of $0.18 per share. The fair value of the relative debt warrants was $433,753, which was recognized as a debt discount and being amortized to interest expense over the life of the notes. During the years ended December 31, 2024 and 2023, amortization of debt discount was $72,292 and $72,292, respectively. As of December 31, 2024 and 2023, convertible note payable at fair value was $513,135 and $426,606, respectively.

ITEM 6: OTHER INFORMATION

None.

FINANCIAL STATEMENTS

RAD Technologies, Inc.

Consolidated Financial Statements

December 31, 2024 and 2023

RAD Technologies, Inc.

Index to Financial Statements

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

To the Board of Directors of

RAD Technologies, Inc.

Venice, California

INDEPENDENT AUDITOR’S REPORT

Opinion

We have audited the accompanying consolidated financial statements of RAD Technologies, Inc. and subsidiary (collectively, the “Company”) which comprise the consolidated balance sheets as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements.

In our opinion, the consolidated financial statements referred to above presents fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024 and 2023, and the results of its consolidated operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Substantial Doubt About the Company’s Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 2 to the consolidated financial statements, the Company has not generated profits since inception and has sustained net losses of $8,539,470 and $5,452,951 for the years ended December 31, 2024 and 2023, respectively, and has incurred negative cash flows from operations for the years ended December 31, 2024 and 2023. As of December 31, 2024, the Company had an accumulated deficit of $35,869,007 and cash of $277,938, relative to negative operating cash flows of $5,330,016 in 2024. The Company has a working capital deficit of $1,337,998 as of December 31, 2024, including a secured convertible note that was demandable in 2024. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.

Artesian CPA, LLC

1312 17th Street, #462 | Denver, CO 80202

p: 877.968.3330 f: 720.634.0905

info@ArtesianCPA.com | www.ArtesianCPA.com

Responsibilities of Management for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the consolidated financial statements that is free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or 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 consolidated financial statements are available to be issued.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements, including omissions, are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

/s/ Artesian CPA, LLC

Artesian CPA, LLC

Denver, Colorado

May 5, 2025

Artesian CPA, LLC

1312 17th Street, #462 | Denver, CO 80202

p: 877.968.3330 f: 720.634.0905

info@ArtesianCPA.com | www.ArtesianCPA.com

RAD Technologies, Inc.

Consolidated Balance Sheets

See Independent Auditor’s Report and accompanying notes, which are an integral part of these consolidated financial statements.

RAD Technologies Inc.

Consolidated Statements of Operations and Comprehensive Loss

See Independent Auditor’s Report and accompanying notes, which are an integral part of these consolidated financial statements.

RAD Technologies Inc.

Consolidated Statements of Changes in Stockholders’ Equity

See Independent Auditor’s Report and accompanying notes, which are an integral part of these consolidated financial statements.

RAD Technologies Inc.

Consolidated Statements of Cash Flows

See Independent Auditor’s Report and accompanying notes, which are an integral part of these consolidated financial statements.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

RAD Technologies Inc. (the “Company” or “RAD”) is a Delaware corporation formed on July 6, 2018. The Company provides a content artificial intelligence (“AI”) technology solution to digital marketing teams at various enterprises which aims to improve the performance of their articles, advertisements, emails, and product descriptions.

On June 28, 2021, the Company formed a wholly-owned subsidiary, RAD Canada Inc. (“RAD Canada”) in the Province of Ontario, Canada. On August 5, 2021, RAD Canada entered into an Asset Purchase Agreement (“Agreement” or “Merger”) with Atomic Reach, Inc. (“Atomic Reach” or “AR”) whereby Atomic Reach agreed to sell, convey, assign, transfer and deliver to RAD substantially all of the assets, property and undertaking of and relating to the AR business, on the terms and conditions of the Agreement. The AR business is comprised of the development and commercialization of artificial intelligence software and services for producing, editing and optimizing the performance of electronic written content including marketing content such as emails, blogs, landing pages, articles, internet ads, product and service descriptions and similar content. See Note 3 for further detail.

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

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since inception and has sustained net losses of $8,539,470 and $5,452,951 for the years ended December 31, 2024 and 2023, respectively, and has incurred negative cash flows from operations for the years then ended. As of December 31, 2024, the Company had an accumulated deficit of $35,869,007 and had limited liquid assets to satisfy its obligations as they come due with $277,938 of cash and a working capital deficit of $1,337,998 as of December 31, 2024. Furthermore, the Company has a $500,000 secured convertible note which was demandable in 2024 but not yet repaid. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

The Company’s ability to continue as a going concern in the next twelve months following the date the consolidated financial statements were available to be issued is dependent upon its ability to produce revenues and/or obtain financing sufficient to meet current and future obligations and deploy such to produce profitable operating results.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Management has evaluated these conditions and plans to generate revenues and raise capital as needed to satisfy its capital needs. During the next twelve months, the Company intends to fund its operations through debt and/or equity financing. There are no assurances that management will be able to raise capital on terms acceptable to the Company. If it is unable to obtain sufficient amounts of additional capital, it may be required to reduce the scope of its planned development, which could harm its business, financial condition, operating results, and ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from these uncertainties.

In August 2021, the Company entered into an agreement with Atomic Reach, a content AI technology company based in Toronto to combine the business and operations of both companies. The transaction was structured as a business combination of Atomic Reach’s assets by RAD Canada Inc. (“Buyer”) in exchange for newly issued 37,521,716 shares of RAD, followed by distribution of such shares by way of a return of capital to AR shareholders in redemption of their AR shares.

The business combination was accounted for as a reverse recapitalization in accordance with GAAP as Atomic Reach has been determined to be the accounting acquirer, primarily due to the fact that Atomic Reach stockholders control the post-combination Company. Under this method of accounting, while RAD is the legal acquirer, it is treated as the “acquired” company for financial reporting purposes.

The net assets of RAD were stated at historical cost, with no goodwill or other intangible assets recorded. The historical financial statements of Atomic Reach for periods prior to the consummation of the merger reflect only the operations and financial condition of Atomic Reach. Subsequent to the consummation of the merger, the financial statements of Atomic Reach will include the combined operations and financial condition of Atomic Reach, RAD and RAD Canada operations.

The balances of additional paid-in capital and accumulated deficit has been adjusted as of December 31, 2022 to conform with ASC 805, Business Combination, which requires to reflect the retained earnings and other equity balances of the legal subsidiary, Atomic Reach, in the consolidated financial statements. The adjustment has no effect on the total stockholders’ equity.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“US GAAP”). The Company has adopted the calendar year as its basis of reporting.

Basis of Consolidation

The consolidated financial statements include the assets, liabilities and the results of operations and cash flows of Atomic Reach, RAD and RAD Canada, Inc. Intercompany balances, and income and expenses arising from intercompany transactions, are eliminated in preparing the consolidated financial statements.

Use of Estimates

The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the accompanying consolidated financial statements include deferred income tax assets, valuation of stock options, and reserves for commitments and contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined.

Cash and Cash Equivalents

Cash and cash equivalents include all cash in banks. The Company considers all highly liquid instruments with original maturities of three months or less to be cash equivalents.

Concentrations of Credit Risk

The Company maintains its cash with a major financial institution located in the United States of America which it believes to be creditworthy. Balances are insured by the Federal Deposit Insurance Corporation up to $250,000. At times, the Company may maintain balances in excess of the federally insured limits. As of December 31, 2024 and 2023, the Company’s cash and cash equivalents exceeded the FDIC insured limits by $0 and $4,648, respectively.

Accounts Receivable

Accounts receivable are recorded at a net realizable value or the amount that the Company expects to collect on gross customer trade receivables. The Company estimates losses on receivables based on known troubled accounts and historical experience of losses incurred. Receivables are considered impaired and written-off when it is probable that all contractual payments due will not be collected in accordance with the terms of the agreement. As of December 31, 2024 and 2023, the Company determined that no reserve allocation was necessary and that there is no significant risk that material uncollectible accounts existed. The Company written off $25,000 and $0 of accounts receivable for the years ended December 31, 2024 and 2023, respectively.

Subscriptions Receivable

The Company records stock issuances at the effective date. If the subscription is not funded upon issuance, the Company records a stock subscription receivable as an asset on the consolidated balance sheet. When stock subscription receivables are not received prior to the issuance of consolidated financial statements at a reporting date in satisfaction of the requirements under FASB Accounting Standards Codification (“ASC”) 505-10-45-2, the stock subscription receivable is reclassified as a contra account to stockholders’ equity on the consolidated balance sheet. As of December 31, 2024 and 2023, subscription receivable was $0 and $364,800, respectively, presented as a contra account to stockholder’s equity.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Deposits

As of December 31, 2024 and 2023, the Company held $34,845 and $37,794 as collateral for credit cards, respectively.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation and impairments. Normal repairs and maintenance costs are charged to earnings as incurred and additions and major improvements are capitalized. The cost of assets retired or otherwise disposed of, and the related depreciation are eliminated from the accounts in the period of disposal and the resulting gain or loss is credited or charged to earnings.

Depreciation is computed over the estimated useful lives of the related asset type using the straight-line method for financial statement purposes. The estimated useful lives for property and equipment consist of furniture and computers and straight-line depreciation is based on a useful life of 3-5 years.

Acquisitions, Goodwill and Other Intangible Assets

The Company allocates the cost of an acquired business to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. The excess value of the cost of an acquired business over the estimated fair value of the assets acquired and liabilities assumed is recognized as goodwill. The Company uses a variety of information sources to determine the value of acquired assets and liabilities, including identifiable intangibles.

Intangible Assets

Intangible assets are stated at their historical cost less accumulated amortization and impairment. Intangible items acquired must be recognized as assets separately from goodwill if they meet the definition of an asset, are either separable or arise from contractual or other legal rights, and their fair value can be measured reliably. The Company’s intangible assets consistent of developed technology pursuant to the Atomic Reach merger. The estimated useful life for the technology is 5 years, which is amortized on a straight-line basis.

Impairment of Long-lived Assets

Long-lived assets, such as property, equipment, and identifiable intangibles with finite useful lives, are periodically evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company looks for indicators of a trigger event for asset impairment and pays special attention to any adverse change in the extent or manner in which the asset is being used or in its physical condition. Assets are reviewed using factors including, but not limited to, future operating plans and projected cash flows. The determination of whether impairment has occurred is based on an estimate of undiscounted future cash flows directly related to the assets, compared to the carrying value of the assets. If the sum of the undiscounted future cash flows of the assets does not exceed the carrying value of the assets, full or partial impairment may exist. If the asset carrying amount exceeds its fair value, an impairment charge is recognized in the amount by which the carrying amount exceeds the fair value of the asset. Fair value is determined using an income approach, which requires discounting the estimated future cash flows associated with the asset.

As of December 31, 2024 and 2023, there was no impairment for long-lived assets.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Related Party Transactions

The Company follows FASB ASC subtopic 850-10, “Related Party Disclosures”, for the identification of related parties and disclosure of related party transactions. Pursuant to ASC 850, related parties include: a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825-10-15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

Foreign Currency Translation

The Company’s consolidated financial statements are presented in US Dollar, which is also the functional currency of RAD Technologies, Inc. For each entity, functional currency is determined and items included in their separate financial statements are measured using that functional currency. All assets and liabilities are translated into U.S. Dollars at the balance sheet date, stockholders’ equity, property and equipment and intangible assets are translated at historical rates and revenue and expense accounts are translated at the average exchange rate for the year or the reporting period. The translation adjustments are reported as a separate component of consolidated stockholders’ equity, captioned as accumulated other comprehensive income. Transaction gains and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the consolidated statements of operations as foreign currency exchange variance.

Comprehensive Loss

Comprehensive loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. During the years ended December 31, 2024 and 2023, the Company’s only element of other comprehensive income was gains and losses from foreign currency translations.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Income Taxes

RAD is a C corporation for income tax purposes. The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. The Company records interest, net of any applicable related income tax benefit, on potential income tax contingencies as a component of income tax expense. The Company records tax positions taken, or expected to be taken, in a tax return based upon the amount that is more likely than not to be realized or paid, including in connection with the resolution of any related appeals or other legal processes. Accordingly, the Company recognizes liabilities for certain unrecognized tax benefits based on the amounts that are more likely than not to be settled with the relevant taxing authority. The Company recognizes interest and/or penalties related to unrecognized tax benefits as a component of income tax expense.

Revenue Recognition

The Company recognizes revenues in accordance with FASB ASC 606, Revenue from Contracts with Customers. The Company determines revenue recognition through the following steps:

Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenue is recognized when performance obligations under the terms of a contract with a customer are satisfied and the promised services have been transferred to the customer.

The Company derives its revenues from campaign-based influencer marketing and recurring subscription fees for having access to our AI platform. With respect to campaign-based influencer marketing, customers engage with the Company by confirming a total budget amount they have dedicated for a specific campaign. The Company then executes the influencer campaign deliverables while taking into consideration budget, margin and customer expectations. On the other hand, when customers engage the Company to access the AI platform, they are paying to have access to the AI platform for content ranking, optimization and recommendation tools. These tools typically improve content strategy, email programs, blogs and website copy.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

The Company recognizes revenue from its marketing campaigns (channel fees) over time throughout the term of the agreed upon campaign, which is a measure of the Company’s progress. The Company recognizes subscription fees (licensing fees) over time throughout the term of the customer contract.

Revenue by source consisted of the following for the years ended December 31, 2024 and 2023:

Concentration Risks on Revenue

The Company’s revenues carry significant concentrations with four customers representing 82% of total revenues (35%, 22%, 15% and 11%). Loss of any of these customers would have a material adverse impact on the Company’s operations.

Contract Balances

The Company invoices customers based upon contractual billing schedules, and accounts receivable are recorded when the right to consideration becomes unconditional. Contract liabilities represent prepayments received in advance of performance obligations met.

The following table summarizes the accounts receivable balance as of December 31, 2024 and 2023.

As of December 31, 2024 and 2023, the Company has no deferred revenue.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Cost of Net Revenues

Cost of revenues for marketing campaigns represent direct payouts to recipients who have earned the monies and/or have incurred direct expenses associated with events held. Cost of revenues also includes fees paid to talent, influencer procurement, and other direct costs of servicing the campaign including contract labor. Cost of revenues for subscription feeds include technology hosting fees. Lastly, cost of revenues includes amortization of the Company’s intangible assets pertaining to developed technology.

Advertising and Promotion

Advertising and promotional costs are expensed as incurred. Advertising and promotional expenses for the years ended December 31, 2024 and 2023, amounted to $2,026,650 and $359,533, respectively, which is included in sales and marketing expenses.

Research and Development Costs

Costs incurred in the research and development of the Company’s products are expensed as incurred.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation. The Company measures all stock-based awards granted to employees, directors and non-employee consultants based on the fair value on the date of the grant and recognizes compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award. For awards with service-based vesting conditions, the Company records the expense for using the straight-line method. For awards with performance-based vesting conditions, the Company records the expense if and when the Company concludes that it is probable that the performance condition will be achieved. The Company classifies stock-based compensation expense in its consolidated statement of operations in the same manner in which the award recipient’s costs are classified.

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The Company was a private company and lacks company-specific historical and implied volatility information for its stock. Therefore, it estimates its expected stock price volatility based on the historical volatility of publicly traded peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends on common stock and does not expect to pay any cash dividends in the foreseeable future. Forfeitures are recognized as they occur. Determining the appropriate fair value of stock-based awards requires the input of subjective assumptions.

The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, stock-based compensation expense could be materially different for future awards.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Net Loss per Share

Net earnings or loss per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding during the period, excluding shares subject to redemption or forfeiture. The Company presents basic and diluted net earnings or loss per share. Diluted net earnings or loss per share reflect the actual weighted average of common shares issued and outstanding during the period, adjusted for potentially dilutive securities outstanding. Potentially dilutive securities are excluded from the computation of the diluted net loss per share if their inclusion would be anti-dilutive. As all potentially dilutive securities are anti-dilutive as of December 31, 2024 and 2023, diluted net loss per share is the same as basic net loss per share. Potentially dilutive items included the following:

As of December 31, 2024 and 2023, there was an estimated number of 2,705,774 dilutive shares based on the terms of the Company’s outstanding convertible note (see Note 9).

Deferred Offering Costs

The Company complies with the requirements of FASB ASC 340-10-S99-1 with regards to offering costs. Prior to the completion of an offering, offering costs are capitalized. The deferred offering costs are charged to stockholders’ equity upon the completion of an offering or to expense if the offering is not completed. As of December 31, 2024 and 2023, there were no deferred offering costs.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Fair Value of Financial Instruments

The carrying value of the Company’s financial instruments included in current assets and current liabilities (such as cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value due to the short-term nature of such instruments).

The inputs used to measure fair value are based on a hierarchy that prioritizes observable and unobservable inputs used in valuation techniques. These levels, in order of highest to lowest priority, are described below:

Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2—Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

Level 3—Unobservable inputs reflecting the Company’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

The carrying values of the Company’s accounts receivable, accounts payable and accrued expenses and other current liabilities approximate their fair values due to the short maturity of these instruments.

The Company’s convertible note recorded is a Level 3 liability. The liability is valued using a fair value method.

The Company’s convertible note (see Note 9) is valued using the fair value option under ASU 2020-06. The primary reason for electing the fair value option is for simplification of accounting for the convertible note at fair value in its entirety versus bifurcation of the embedded derivatives. The significant inputs to the valuation of the convertible note at fair value are Level 3 inputs since they are not observable directly. At initial recognition, the fair value was determined using the intrinsic value of the notes using the fair value of the underlying common stock price at $0.18 per share and the determined conversion price of $0.18 derived from a 20% discount on the Company’s Regulation CF offering at $0.18 per share. As of December 31, 2024 and 2023, the fair value was determined using the underlying common stock price of $0.35 and $0.18, estimated term of 1.90 years and 2.40 years, annual volatility rate of 70% and 70%, and discount rate of 4.24% and 4.14%, all respectively.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows:

The following table presents the activity of the convertible note:

As of December 31, 2024 and 2023, the fair value of the convertible notes was $513,135 and $426,606, respectively.

Recently Issued and Adopted Accounting Pronouncements

The FASB issues ASUs to amend the authoritative literature in ASC. There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to us or (iv) are not expected to have a significant impact on our consolidated financial statements.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which focuses on the rate reconciliation and income taxes paid. This ASU requires disclosure, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further broken out by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, the ASU requires disclosure of income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. The ASU is effective for public business entities for annual periods beginning after December 15, 2024 and effective for all other business entities one year later. Entities should adopt this guidance on a prospective basis, though retrospective applications is permitted. The Company expects this ASU to only impact the disclosures on the consolidated financial statements with no impacts on the financial condition, results of operations and cash flows.

Management does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the accompanying consolidated financial statements. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances.

The Company evaluated the Atomic Reach asset purchase agreement pursuant to ASC 805 and ASU 2017-01, Topic 805, Business Combinations. The Company first determined that both RAD and Atomic Reach met the definition of business as they each included inputs and a substantive process that together significantly contribute to the ability to create outputs.

Management next evaluated whether the Agreement should be accounted as a reverse acquisition, whereby the legal acquirer (RAD) is identified as the acquiree for accounting purposes and the entity (Atomic Reach) whose equity interests are acquired (legal acquiree) is the acquirer for accounting purposes. The Company determined that Atomic Reach was the accounting acquirer via ASC 810-10-55 as the Atomic Reach shareholders retained relative voting rights and the majority composition of the governing body after the consummation of the merger. Consequently, Atomic Reach applied acquisition accounting to the assets and liabilities of RAD that were acquired or assumed upon the consummation of the merger. The historical financial statements of Atomic Reach for periods ended prior to the consummation of the merger will reflect only the operations and financial condition of Atomic Reach. Subsequent to the consummation of the merger, the financial statements of Atomic Reach will include the combined operations and financial condition of Atomic Reach, RAD and RAD Canada.

The legal acquirer, RAD, was the surviving legal entity and continues to issue financial statements. Although the surviving legal entity may continue, the financial reporting will reflect the accounting from the perspective of the accounting acquirer, except for the legal capital, which is retroactively adjusted to reflect the capital of the legal acquirer (accounting acquiree) in accordance with 805-40-45-1.

The acquisition method of accounting requires, among other things, that the assets acquired, and liabilities assumed in a business combination be measured at their estimated respective fair values as of the closing date of the acquisition. Intangible assets recognized in connection with this transaction represent primarily the potential economic benefits that the Company believes may arise from the acquisition as the primary element of the purchase was the developed technology.

On August 5, 2021, the Company issued 37,521,716 shares of common stock pursuant to the asset purchase agreement

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Total fair value of the preliminary purchase price consideration as of August 5, 2021 was determined in accordance with ASC 805-40-55 as follows:

Purchase Price Allocation

The Company has made a allocation of the purchase price in regard to the acquisition related to the assets acquired and the liabilities assumed as of the purchase date. The following table summarizes the preliminary purchase price allocation:

Intangible assets of $6,081,610 acquired pursuant to the merger were identified as developed technology, which will be amortized over a useful life of five years.

Discontinued Operations

In accordance with the provisions of ASC 205-20, the Company has excluded the results of discontinued operations from its results of continuing operations in the accompanying consolidated statements of operations for the years ended December 31, 2024 and 2023. The results of the discontinued operations for the years ended December 31, 2024 and 2023 consist of the following:

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

The following table presents the aggregate carrying amounts of the classes of assets and liabilities of discontinued operations as of December 31, 2024 and 2023:

The following table shows the results of cash flows of the business reported as discontinued operations for the periods ended December 31, 2024 and 2023:

Certain reclassifications have been made to the prior year’s financial statements to enhance comparability with the current year’s financial statements. As a result, certain line items have been amended in the consolidated statements of operations. Comparative figures have been adjusted to conform to the current year’s presentation. These reclassifications had no effect on the reported net loss. As discussed in Note 3, there were changes in the equity classifications as of December 31, 2022 reflected in these consolidated financial statements.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

As of December 31, 2024 and 2023, property and equipment consist of:

Depreciation expense for the years ended December 31, 2024 and 2023 were $2,946 and $2,938, respectively.

As of December 31, 2024 and 2023, intangible assets consist of:

Amortization expense for intangible assets for the years ended December 31, 2024 and 2023, were $1,216,322 and $1,216,322, respectively.

Economic Injury Disaster (EIDL) loan

The Company obtained an Economic Injury Disaster (EIDL) loan for $250,000 on April 10, 2020, and on August 16, 2021 the Company obtained a second loan in the amount of $250,000.

The EIDL is a low interest, fixed-rate, long term loan obtained directly from the U.S. Small Business administration (SBA) to help overcome the effects of the pandemic by providing working capital to meet operating expenses. The loan bears interest at a rate of 3.75% per annum and matures 30 years from the date of the loan. The loan is secured by the assets of the Company. As of December 31, 2024 and 2023, the principal outstanding of the loan was $500,000. During the years ended December 31, 2024 and 2023, the Company made payments of $19,573 and $25,750, respectively, of accrued interest. Accrued interest on the loan as of December 31, 2024 and 2023, amounted to $31,192 and $31,964. Interest expense for the years ended December 31, 2024 and 2023 was $18,801 and $18,750, respectively.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Convertible Notes

The Company entered into a $500,000 (“Principal Amount”) convertible note (“Note”) with a related party (“Holder”) on October 17, 2022 (“Date of Issuance”). Unless earlier retired or converted into Conversion Shares (as defined below), the outstanding balance of this Note will be due and payable by the Company at any time on or after October 16, 2028 (the “Maturity Date”) at the Company’s election or upon demand by the Holder. The note is secured by all assets of the Company.

The Company may satisfy this Note in full by repaying the Principal Amount at any time within 12 months from the Date of Issuance; by repaying 130% of the Principal Amount at any time after 12 months from the Date of Issuance and prior to 24 months from the Date of Issuance: by repaying 160% of the Principal Amount at any time after 24 months from the Date of Issuance and prior to 36 months from the Date of Issuance; or, by repaying 200% of the Principal Amount at any time after 36 months from the Date of Issuance. The Holder may accelerate the payment of this Note at any time after 24 months from the Date of Issuance and require the Company satisfy the Note in full by repaying the Principal Amount. The repayment amount effective as of December 31, 2024 and 2023 was $800,000 and $650,000, respectively. During the years ended December 31, 2024 and 2023, the Company incurred $150,000 and $150,000 of interest expense, respectively, in connection with this Note. $300,000 and $150,000 of interest was accrued and outstanding at December 31, 2024 and 2023, respectively.

At any time on or after the date of issuance, at the election of the Holder, the Note will convert into that number of Common Shares equal to the quotient (rounded down to the nearest whole share) obtained by dividing the outstanding principal balance of this note on the date of such conversion by the applicable Conversion Price. Conversion Price means (rounded to the nearest 1/10th of one cent) the lower of: (i) the product of 100% less the discount of 20% and (y) the lowest per share purchase price of the equity securities issued in the next equity financing; and (ii) the lowest per share purchase price of the equity securities issued in the Crowd Funding Financing. Crowd Funding Financing means the sale (or series of related sales) by the Company of its equity securities through the WeFunder crowd funding platform which was launched in 2022.

In connection with the convertible notes, the Company granted an aggregate of 19,850,818 warrants to the holder with an exercise price of $0.18 per share. The fair value of the relative debt warrants was $433,753, which was recognized as a debt discount and being amortized to interest expense over the life of the notes. During the years ended December 31, 2024 and 2023, amortization of debt discount was $72,292 and $72,292, respectively. As of December 31, 2024 and 2023, convertible note payable at fair value was $513,135 and $426,606, respectively.

In the event any amounts remain outstanding on this Note after 12 months following the Date of Issuance, Holder, at its sole discretion, may require Company to seek the sale, merger, or disposition of the Company and/or its assets.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Common Stock

The Company is authorized to issue 200,000,000 shares of Class A common stock at a par value of $0.0001 and 50,000,000 shares of Class B non-voting common stock at a par value of $0.0001. The Class A and Class B common stock are identical except with respect to voting rights, to which Class B common stockholders do not have voting rights.

Stock Transactions

During the year ended December 31, 2023, the Company issued 14,915,592 shares of Class A common stock and 4,740,409 shares of Class B common stock pursuant to Regulation CF for aggregate proceeds of $2,659,336 and $1,125,000, net of offering costs, respectively. During the year ended December 31, 2023, the Company issued 1,289,894 shares of Class B common stock pursuant to Regulation CF for aggregate subscribed amount of $364,800 recorded in subscription receivable, which was collected in 2024.

During the year ended December 31, 2023, the Company issued 902,265 shares of Class A common stock for aggregate proceeds of $165,000 in cash.

During the year ended December 31, 2024, the Company issued 15,978,925 shares of Class B common stock pursuant to Regulation CF and Regulation D offerings for aggregate proceeds of $5,165,778, net of offering costs. There was $189,899 of escrow receivables outstanding related to these issuances as of December 31, 2024.

As of both December 31, 2024 and 2023, there were 98,415,337 shares of Class A common stock issued and outstanding.

As of December 31, 2024 and 2023, there were 22,009,228 and 6,030,303 shares of Class B common stock issued and outstanding, respectively.

In connection with the October 2022 convertible notes (see Note 9), the Company issued 19,850,818 warrants to purchase common stock. The warrants have an exercise price of $0.18 per share, are immediately exercisable and have a term of 10 years. The fair value of the relative warrants was $433,753, which was recognized as a debt discount and is being amortized to interest expense over the life of the convertible notes.

In December 2024, the Company issued 45,455 warrants to purchase common stock. The warrants have an exercise price of $0.33 per share, are immediately exercisable and have a term of 5 years. The fair value of the relative warrants was $11,040, which was recognized as stock-based compensation expense during the year ended December 31, 2024.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

A summary of information related to warrants is as follows:

The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of warrants granted:

The Company’s Board of Directors adopted an Equity Incentive Plan in 2022 (the “Plan”), to attract, incentivize and retain employees, outside directors and consultants through the grant of awards. Options granted under the Plan may be ISOs (Incentive Stock Options) intended to qualify under Code Section 422 or NSOs (Non-statutory Stock Options) or restricted stock and only employees are eligible for the grant of ISOs. The Plan is effective for a term of ten years from the date of its adoption. The maximum aggregate number of shares that may be issued under the plan is 44,897,910 shares of common stock. As of December 31, 2024, there were 2,696,155 of options available for issuance.

To the extent that the aggregate fair market value of shares with respect to which options designated as incentive stock options are exercisable for the first time by any optionee during any calendar year (under all plans of the Company or any parent or subsidiary) exceeds $100,000, such excess options will be treated as non-statutory stock options.

The term of each option cannot be no more than 10 years from the date of grant or such shorter term as may be provided in the option agreement and provided further that, in the case of an Incentive Stock Option granted to a person who at the time of such grant is a ten percent holder, the term of the option shall be 5 years from the date of grant thereof or such shorter term as may be provided in the option agreement.

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

A summary of information related to stock options is as follows:

The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of stock options granted to employees and directors:

The total grant-date fair value of the options granted during the years ended December 31, 2024 and 2023 was $207,531 and $2,360,227, respectively. Stock-based compensation expense for stock options of $733,029 and $343,245, was recognized under FASB ASC 718 for the years ended December 31, 2024 and 2023, respectively. Total unrecognized compensation cost related to non-vested stock option awards amounted to $1,835,576 as of December 31, 2024 and will be recognized over a weighted average period of 2.37 years as of December 31, 2024.

Classification

Stock-based compensation expense was classified in the consolidated statements of operations as follows:

RAD Technologies Inc.

Notes to the Consolidated Financial Statements

As of and for the Years Ended December 31, 2024 and 2023

Due to from Related Parties

As of December 31, 2024 and 2023, the Company had $11,340 and $8,362, respectively, in amounts due from officers. The amounts are unsecured, non-interest bearing and due on demand.

Convertible Note

On October 7, 2022, the Company issued a convertible note in the amount of $500,000 to an existing major shareholder. See Note 9 for further detail.

The provision for income taxes for the years ended December 31, 2024 and 2023 consists of the following:

A reconciliation of the U.S federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2024 and 2023 is as follows:

Significant components of the Company’s deferred tax assets as of December 31, 2024 and 2023 are as follows: