NOTE 6 – EQUITY IN NON-MARKETABLE SECURITIES OF AFFILIATED ENTITY

As of October 31, 2025, the Company invested $145,000 in the non-marketable equity securities of Exotropin (“Exotropin”), a privately-held skin-care formulator in an effort to accelerate the Company’s development of expertise with respect to the skincare industry and the potential supply of the Company’s products in future formulations. As of October 31, 2025, the Company had recorded total reserves against the carrying value of its investment of Exotropin of $145,000, based on the limited financial history of Exotropin to date and the lack of any information to ascertain the fair value of Exotropin.

On March 31, 2026 (“Execution Date”) the Company, Greyt Ventures, LLC (“Greyt”), a principal shareholder of the Company and Skycrest Holdings, LLC, a former principal shareholder of the Company (“Skycrest” and, together with the Company and Greyt, each a “Seller” and collectively “Sellers”), AML Group Holdings, LLC, a Florida limited liability company (“AML”) BRM Holdings LLC a Delaware limited liability company (“BRM”), B4U2 LLC a Delaware limited liability company (“B4U2”), and GFourz Holdings LLC an Illinois limited liability company (“Gfourz” and, together with AML, BRM, and B4U2 each a “Purchaser” and collectively “Purchasers”), and Exotropin (Exotropin together with Purchasers and Sellers, each a “Party” and collectively the “Parties”) entered into a purchase and sales agreement (“Agreement”) whereby each Seller agreed to sell to Purchasers, and Purchasers agreed to purchase from each Seller, all of such Seller’s Membership Units in Exotropin, including, without limitation, the corresponding rights, powers, benefits, and privileges relating thereto or arising therefrom, and the obligations thereunder, pursuant to Exotropin’s Limited Liability Company Agreement (as amended to date, the “LLC Agreement”) relating to the Membership Units (collectively, the “Membership Interests”), for the aggregate cash consideration of $2,788,000 (the “Purchase Price”). The Parties agreed to allocate the Purchase Price as follows: $376,000 to the Company in respect of the Company’s Membership Interests; $1,206,000 to Greyt in respect of Greyt’s Membership Interests; and $1,206,000 to Skycrest in respect of Skycrest’s Membership Interests (the foregoing amounts allocated to each of the Sellers, an “Allocated Purchase Price”).

The closing of the purchase and sale of the Membership Interests, including payment of the Allocated Purchase Price took place on April 7, 2026 (“Closing”). At the Closing, (i) each Seller delivered to the Purchasers an Assignment of its Membership Interests (ii) Purchasers paid the Allocated Purchase Price to each Seller by wire transfer, (iii) Exotropin delivered to the Company a dismissal notice dismissing its pending lawsuit against the Company with prejudice and with each party agreeing to bear its own fees and costs (see Note 13) and (iv) the Company returned all remaining inventory of Exotropin held by Seller as of the date of the Agreement. In addition, under the terms of the Agreement, effective as of the Closing, and without any further action of the Company or Exotropin, the Sales Representative Agreement (“Sales Agreement”) between the Company and Exotropin was terminated and was of no further force or effect and the Company and none of the provisions of the Sales Agreement survive termination of the Sales Agreement. The Agreement also provided for other terms regarding non solicitation and each party provided general mutual releases. During the three months and six months ended April 30, 2026, the Company recorded a gain of $390,000 from the sale of its Exotropin interests comprised of the proceeds of $376,000 received from the sale of its interests in Exotropin and the reduction of previously recorded liabilities of $14,000.

For the three months and six months ended April 30, 2026, no commissions were paid to the Company in connection with the Sales Agreement. For the three months and six months ended April 30, 2025, $19,000 and $51,000, respectively, of commissions were earned under the Sales Agreement. The commissions earned under the Sales Agreement are reflected in other income in the unaudited consolidated financial statements.