The accompanying condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the financial statements of wholly-owned and majority owned subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation. Non-controlling interests at June 30, 2026 and 2025 relate to the interests of third parties in the partially owned subsidiaries.

The principal members of the Company have a controlling interest in MDB Capital, S.A., a company organized and based in Nicaragua. As the Company itself does not have a controlling financial interest in this entity, management has determined MDB Capital, S.A. is not a variable interest entity and should not be consolidated as it has no ownership interests, so has excluded this entity from the Company’s consolidated financial statements. It is the Company’s policy to reevaluate this conclusion on an annual basis or if there are significant changes in ownership.

The Company applies the equity method to account for investments in entities where it has the ability to exercise significant influence over the operating and financial policies of the investee. Under the equity method, the investment in eXoZymes Inc, (“eXoZymes “), formerly Invizyne Technologies Inc. (“Invizyne”)”, is initially recorded at cost and subsequently adjusted to reflect the Company’s proportional share of the investee’s results of operations in its consolidated financial statements. Equity method investments are periodically reviewed for any other-than-temporary declines in value. The Company’s investment in eXoZymes is presented as “Equity method investment” on the consolidated balance sheet.

Any excess of the acquisition cost over the Company’s share of the net fair value of eXoZymes’ identifiable assets and liabilities at the acquisition date is recognized as goodwill, which is included in the carrying amount of the investment.

When the Company increases its interest in an affiliate accounted for under the equity method while retaining significant influence, it applies the acquisition method only to the additional interest acquired, leaving the previous interest unchanged. Conversely, when there is a decrease in the interest in an affiliate accounted for under the equity method while retaining significant influence, the Company derecognizes a proportionate part of its investment and recognizes any resulting gain or loss in profit or loss.

The Company accounts for income taxes using the asset and liability method, under which it recognizes the amount of taxes payable or refundable for the current year and deferred tax assets and liabilities for the future tax consequences of events that have been recognized in the financial statements or tax returns. The Company measures current and deferred tax assets and liabilities based on provisions of enacted tax law. It evaluates the realization of our deferred tax assets based on all available evidence and establish a valuation allowance to reduce deferred tax assets when it is more likely than not that they will not be realized.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period, as well as the disclosure of contingent assets and liabilities. Some of those judgments can be subjective and complex, and therefore, actual results could differ materially from those estimates under different assumptions or conditions. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Significant estimates include those related to assumptions used in the valuation of investment securities, accruals for potential liabilities, valuing equity instruments issued for services, assumptions used in the valuation of the equity method investment and gains on the deconsolidation of the subsidiary, the estimate of the fair value of the lease liability and related right of use assets, net realizable value of receivables, useful life of property and equipment, determining impairment of long-lived assets, and the realization of any deferred tax assets.

The Company is an “emerging growth company,” or “EGC” as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected to opt out of the extended transition periods.

The Company considers highly liquid investments with original maturities or remaining maturities upon purchase of three months or less to be cash equivalents.

The Company’s policy is to maintain its cash balances with financial institutions with high credit ratings and in accounts insured by the Federal Deposit Insurance Corporation (the “FDIC”) and/or by the Securities Investor Protection Corporation (the “SIPC”). The Company may periodically have cash balances in financial institutions in excess of the FDIC and SIPC insurance limits of $250 thousand and $500 thousand, respectively.

The Company periodically reviews the financial condition of the financial institutions and assesses the credit risk of such investments. The Company did not experience any credit risk losses during the three and six months ended June 30, 2026 and 2025.

The Company provides deposits or enters into agreements that would require funds to be held in a segregated cash account. At June 30, 2026, the Company had $0.3 million of segregated cash consisting of funds held in reserve for customers. At December 31, 2025, the Company had $2.3 million of segregated cash consisting of funds held in reserve for customers and non-customers.

The Company is obligated to maintain security deposits with the DTC and NSCC. At June 30, 2026 and December 31, 2025, these deposits totaled $2.0 million and $2.0 million.

The Company has prepaid and other current assets totaling $1.05 million at June 30, 2026, consisting of acquired intangible assets totaling $44 thousand, registered direct offering funds for $667 thousand, prepaid professional fees totaling $50 thousand, security deposits totaling $19 thousand, prepaid insurance of $87 thousand, various prepaid expenses of $158 thousand, and other assets of $23 thousand. Prepaid and other assets totaling $433 thousand at December 31, 2025, consisting of acquired intangible assets totaling $44 thousand, prepaid professional fees totaling $50 thousand, security deposits totaling $19 thousand, prepaid insurance of $169 thousand, various prepaid expenses of $130 thousand, and other assets of $21 thousand.

Leases of the Company consist primarily of contracts for the right to use and direct use of an individual property. Leases were analyzed for evidence of significant additional components and to determine if these components were separately identifiable within the context of the contract. As an accounting policy, to account for these components, the Company has elected the practical expedient for property leases that have both lease and non-lease components for them to be combined into a single component and account for as a lease. This policy is effective for all current and future property operating leases and applied uniformly and will be disclosed as such within the financial statements. Operating lease assets are included within right-of-use assets and the corresponding operating lease liabilities are included within liabilities on the Company’s condensed consolidated balance sheet as of June 30, 2026 and December 31, 2025.

The Company has elected not to present short-term leases on the condensed consolidated balance sheet as these leases have a lease term of 12 months or less at lease inception and do not contain purchase options or renewal terms that the Company is reasonably certain to exercise. All other right-of-use assets and lease liabilities are recognized based on the present value of lease payments over the lease term at the lease commencement date. Because the Company’s leases do not provide an implicit rate of return, the Company used the Company’s incremental borrowing rate based on the information available at lease commencement date in determining the present value of lease payments.

Stock-based compensation primarily consists of restricted stock units with service or market/performance conditions. Equity awards are measured at the fair market value of the underlying stock at the grant date. The Company recognized stock based compensation expense using the straight-line attribution method over the requisite service period. The Company’s subsidiary issued stock options and the fair value is determined utilizing Black-Scholes options-pricing model. The Company accounts for forfeitures as they occur, rather than applying an estimated forfeiture rate. For performance-based restricted stock units, the compensation cost is recognized based on the number of units expected to vest upon the achievement of the performance conditions. Shares are issued on the vesting dates net of the applicable statutory tax withholding to be paid by us on behalf of our employees. As a result, fewer shares are issued to the employee than the number of awards outstanding. The Company records a liability for the tax withholding to be paid by it as a reduction to Additional paid-in capital.

The Company strategically invests funds in U.S. Treasury Bills, early-stage technology companies, and equity securities and options of publicly traded and privately held companies. The Company classifies investment securities as investment securities, at amortized cost, investment securities, at fair value, or investment securities, at cost less impairment.

Investment securities, at amortized cost – From time to time the Company will hold funds in investment securities, at amortized cost. This is comprised of debt securities held by MDB and are classified as investment securities held-to-maturity and carried at amortized cost if management has the positive intent and ability to hold the securities to maturity. Initially, the cost of these securities was recorded, and later on, they were assessed at amortized cost, which was modified for unamortized purchase premiums and discounts, and also for credit losses provision. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the effective-interest method. Such amortization and accretion are included in the other operating income in the statements of operations. Interest income is recognized when earned. The Company recognizes estimated expected credit losses over the life of the investment security through the allowance for credit losses account. The allowance for credit losses is a valuation account that is deducted from, or added to, the amortized cost basis of the investment security to present the net amount expected to be collected. In determining expected credit losses, the Company considers relevant qualitative factors including, but not limited to, term and structure of the instrument, credit rating by rating agencies and historic credit losses adjusted for current conditions and reasonable and supportable forecasts. The Company holds investments in U.S. Treasury Bills or money market funds backed by U.S. Treasury Bills, so there are no expected credit losses. Declines in fair value of these securities is due to changes in market interest rates, and because it expects to hold these securities until maturity, it does not expect to realize any losses. There were no investment securities, at amortized cost as of June 30, 2026 and December 31, 2025.

Investment securities, at fair value - This is comprised of equity investments held by the broker dealer subsidiary and are reported at fair value with changes in fair value recognized in the statement of operations. Purchases and sales of equity securities, consisting of common stock and warrants to purchase common stock, are recorded based on the respective market price quotations on the trade date. Realized gains and losses on investments represent the net gains and losses on investments sold during the period based on the average cost method. Differences between the fair value of investments at the beginning of the year and the end of the year are recorded on the income statement as unrealized gains and losses.

Related party investment securities, at fair value – This is comprised of related party equity investments, are held by the Company’s broker-dealer subsidiary and are reported at fair value, with changes in fair value recognized in the statement of operations. Purchases and sales of equity securities, consisting of common stock and warrants to purchase common stock, are recorded based on the respective market price quotations on the trade date, and realized gains and losses on investments sold during the period are determined using the average cost method, with differences between the fair value of investments at the beginning and end of the year recorded as unrealized gains and losses. The Company holds warrants to purchase common stock of the investee in addition to its common stock holdings, and as of June 30, 2026, owned approximately 40.75% of the investee’s outstanding common stock, and accordingly, the investment is disclosed as a related party investment security in accordance with the applicable related party disclosure requirements.

Investment securities, at cost less impairment - This is comprised of equity securities without a readily determinable fair value held by the broker dealer subsidiary. The Company has elected to apply the measurement alternative of cost minus impairment, if any, plus or minus changes resulting from observable price changes. The Company will reassess whether such an investment qualifies for the measurement alternative at each reporting period. In evaluating an investment for impairment or observable price changes, we will use inputs including recent financing events, as well as other available information regarding the investee’s historical and forecasted performance. The Company has assessed this investment and determined that the current impairment of such securities held at June 30, 2026 is accurate.

There were no securities at amortized cost on June 30, 2026 and December 31, 2025.

For investment securities at fair value (held at the broker-dealer), net unrealized loss of $1.8 and $2.2 million, were recognized in the statements of operations for three months ended June 30, 2026 and 2025, respectively. For investment securities at fair value (held at the broker-dealer), net unrealized loss of $4.9 and $3.7 million, were recognized in the statements of operations for six months ended June 30, 2026 and 2025, respectively.

For related party investment securities at fair value (held at the broker-dealer), net unrealized loss of $29 thousand and $0, were recognized in the statements of operations for three months ended June 30, 2026 and 2025, respectively. For related party investment securities at fair value (held at the broker-dealer), net unrealized loss of $29 thousand and $0, were recognized in the statements of operations for six months ended June 30, 2026 and 2025, respectively.

For investment securities at fair value (held at the non-broker-dealer), net unrealized loss of $61 thousand and $0, were recognized in the statements of operations for three months ended June 30, 2026 and 2025, respectively. For investment securities at fair value (held at the non-broker-dealer), net unrealized loss of $177 thousand and $0, were recognized in the statements of operations for six months ended June 30, 2026 and 2025, respectively.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are categorized based on whether the inputs are observable in the market and the degree that the inputs are observable. The categorization of financial assets and liabilities within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. There is no significant concentration of credit risk, due to the majority of assets being invested in U.S. Treasury Bills.

The Company determines the fair value of its financial instruments based on a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three levels:

Level 1–- Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date.

Level 2–- Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

Level 3–- Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions.

The Company’s financial instruments primarily consist of cash and investment securities. As of the balance sheet dates, certain investment securities are required to be recorded at fair value with the change in fair value during the period being recorded as an unrealized gain or loss. As of June 30, 2026 and December 31, 2025, the estimated fair values of investment securities, at amortized cost were not materially different from their carrying values as presented as of the balance sheet date. This is primarily attributed to the short-term maturities of these instruments.

Investment securities, at amortized cost: The fair value of U.S. Treasury Bills classified as held-to-maturity investment securities is based on the market price and is classified as Level 1 of the fair value hierarchy.

A description of the valuation techniques applied to the Company’s major categories of assets and liabilities measured at fair value on a recurring basis is as follows:

Investment securities: Public equity securities are assessed for valuation at the close of each period. Warrants are valued using the Black-Scholes model, which considers the stock price at the date of the valuation, the warrants strike price, the term to expiry, the risk-free rate of return, and the expected volatility of the underlying stock.

Investment securities, at cost less impairment: Non-public equity securities and simple agreements for future equity are valued based on the initial investment, less impairment. The Company determined that no impairment was warranted. Since these securities are not actively traded, we will apply valuation adjustments when they become available, and they are categorized in Level 3 of the fair value hierarchy.

The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2026, except for the Level 3 investment that is recorded at cost (in thousands):

During the six months ended June 30, 2026, the Company had transfers between Level 3 to Level 2 of the fair value hierarchy of a fair value of $3.8 million:

Reconciliation of fair value measurements categorized within Level 3 of the fair value hierarchy (in thousands):

The following table presents information about significant unobservable inputs related to material components of Level 3 warrants as of June 30, 2026 (in thousands):

The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025, except for the Level 3 investment that is recorded at cost (in thousands):

Assets	Classification	Level 1		Level 2		Level 3		Total

Investment Securities, at fair value, held by the licensed broker dealer	Equity securities—–- common stock	$	2,571	$	-	$	-	$	2,571

Investment Securities, at fair value, held by the non-licensed broker dealer	Equity securities–- common stock	$	235	$	-	$	-	$	235

Investment Securities (held by our licensed broker dealer)	Warrants		-		132		4,463		4,595

Total assets measured at fair value (held by our licensed broker dealer)		$	2,806	$	132	$	4,463	$	7,401

During the six months ended December 31, 2025, the Company did not have any transfers between Level 1, Level 2, or Level 3 of the fair value hierarchy.

Reconciliation of fair value measurements categorized within Level 3 of the fair value hierarchy (in thousands):


December 31, 2024	$	2,662
Beginning Balance	$	2,662

Receipt from investment banking fees		1,690
Unrealized gains		111
December 31, 2025	$	4,463
Ending Balance	$	4,463

The following table presents information about significant unobservable inputs related to material components of Level 3 warrants as of December 31, 2025 (in thousands):

Assets

Fair

Value

Valuation

Techniques

Significant

Unobservable

Inputs

Range of

Inputs

Weighted-

Average

Warrants

4,463

Black Scholes

Volatility

95.92-120.3

115.45

The Company entered into a revolving credit facility with a bank, (the “Lender”) on July 26, 2025, for a commitment of up to $2.0 million and which matures on July 26, 2027. The loan has a variable interest rate equal to a defined index, currently the Lender’s rate on the sale of Federal Funds, plus 2.25%. The loan commenced with a calculated interest rate of 7.75%. If the Lender determines, in its sole discretion, that the index becomes unavailable or unreliable, either temporary, indefinitely, or permanently, during the term of this loan, the Lender may amend this loan by designating a substantially similar substitute index. The agreement provides for a quarterly payment of the greater of accrued interest or a non-usage fee of $5 thousand. The Company has not made any draw downs on the credit facility.

The Company granted the Lender a security interest in a cash checking account held at the bank as collateral. The Lender has a right of setoff available from this cash account when the line of credit is accessed. As of June 30, 2026 and December 31, 2025, there was $2.2 million and $2.1 million deposited in this account.

The Company is responsible for the payment of all of the Lender’s legal and other fees incurred in connection with administering the loan. The Company has incurred no such costs or debt issue costs.

As of June 30, 2026, and December 31, 2025, there are no outstanding indebtedness under the credit facility and interest expense totaled $0. The Company is in compliance with all material covenants under the agreement.

Property and equipment are recorded at cost. Major improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Gains and losses from disposition of property and equipment are included in the statements of operations when realized. Depreciation is provided using the straight-line method over the following estimated useful lives:

Property and equipment consist of the following as of June 30, 2026 and December 31, 2025, respectively (in thousands):

The Company generates revenue primarily from providing brokerage services and underwriting through Public Ventures. PatentVest and eXoZymes, have had limited activity during the six months ended June 30, 2026 and 2025.

Brokerage revenues consist of (i) trade-based commission income from executed trade orders, (ii) net realized gains and losses from proprietary trades, and (iii) other income consisting primarily of stock loan income earned on customer accounts. Public Ventures recognizes revenue from trade-based commissions and other income when performance obligations are satisfied through the transfer of control, as specified in the contract, of promised services to the customers of Public Ventures. Commissions are recognized on a trade date basis. Public Ventures believes that each executed trade order represents a single performance obligation that is fulfilled on the trade date because that is when the underlying financial instrument is identified, the pricing is agreed upon, and the risks and rewards of ownership have been transferred to/from the customer. When another party is involved in transferring a good or service to a customer, Public Ventures assesses whether revenue is presented based on the gross consideration received from customers (principal) or net of amounts paid to a third party (agent). Public Ventures has determined that it is acting as the principal as the provider of the brokerage services and therefore records this revenue on a gross basis. Clearing, custody and trade administration fees incurred from Interactive Brokers, the Company’s clearing firm, are recorded effective as of the trade date. The costs are treated as fulfillment costs and are recorded in operating expenses in the consolidated statements of operations.

Brokerage revenue is measured by the transaction price, which is defined as the amount of consideration that Public Ventures expects to receive in exchange for services to customers. The transaction price is adjusted for estimates of known or expected variable consideration based upon the individual contract terms. Variable consideration is recorded as a reduction to revenue based on amounts that Public Ventures expects to refund back to the customer. There were no variable considerations for the three and six months ended June 30, 2026 and 2025, respectively.

Investment banking revenues consist of private placement and underwriting fees. The Company generally does not incur costs to obtain contracts with customers that are eligible for deferral or receive fees prior to recognizing revenue related to investment banking transactions, and therefore, as of June 30, 2026 and 2025, the Company did not have any contract assets or liabilities related to these revenues on its consolidated balance sheets.

Investment securities, at fair value, comprised of related party equity investments, are held by the Company’s broker-dealer subsidiary and are reported at fair value, with changes in fair value recognized in the statement of operations. Purchases and sales of equity securities, consisting of common stock and warrants to purchase common stock, are recorded based on the respective market price quotations on the trade date, and realized gains and losses on investments sold during the period are determined using the average cost method, with differences between the fair value of investments at the beginning and end of the year recorded as unrealized gains and losses. The Company enters into underwriting agreements, to act as an underwriter for security offerings, which are for the purpose of the distribution and sale of securities to investors, and the Company recognizes revenue earned from eXoZymes, of which the Company owns approximately 40.75%, on the same basis as revenue from non-related party underwriting engagements; these agreements allow non-defaulting underwriters and the issuer to seek substitute purchasers within 36 hours if an underwriter defaults on its commitment, and if replacements are not found and the default exceeds 10% of the offering, the agreement may be terminated without liability, with revenue recognized under ASC 606 only upon transfer of cash from the investors to the issuer, which is the final receipt of payment in exchange for the securities being purchased on the date of closing, with no recognition for defaulted or terminated portions until resolution.

Private placement fees are related to non-underwritten transactions such as private placements of equity securities, private investments in public equity, and Rule 144A private offerings and are recorded on the closing date of the transaction. Client reimbursements for costs associated with private placement fees are recorded gross within investment banking and various expense captions, excluding compensation. The Company typically receives payments on private placements transactions at the completion of the contract. The Company views the majority of placement fees as a single performance obligation that is satisfied when the transaction is complete, and the revenue is recognized at that point in time.

Taxes and regulatory fees assessed by a government authority or agency that are both imposed on and concurrent with a specified revenue-producing transaction, which are collected by Public Ventures from a customer, are excluded from revenue and recorded against general and administrative expenses.

Public Ventures does not incur any costs to obtain contracts with customers for revenues that are eligible for deferral or receive fees prior to recognizing revenue, and therefore, as of June 30, 2026 and 2025, Public Ventures did not have any contract assets or liabilities related to these revenues in its consolidated balance sheet.

During the three and six months ended June 30, 2026 and 2025, the Company’s technology development segment revenue had no revenue.

PatentVest recognizes revenue when performance obligations are satisfied by transferring promised goods and services to customers in an amount the Company expects to receive in exchange for those goods or services. PatentVest enters into contracts that can include various combinations of its offerings which are generally capable of being distinct and accounted for as a separate performance obligation for the entire contract or a portion of the contract. When performance obligations are combined into a single contract, PatentVest utilizes stand-alone selling price to allocate the transaction price among the performance obligations.

Certain contracts or portions of contracts are duration-based, which in the event of customer cancellation, provide PatentVest with an enforceable right to a proportional payment for the portion of the services provided. Accordingly, revenue from duration-based contracts is recognized using a time-based measure of progress, which PatentVest believes best depicts how it satisfies its performance obligations in these arrangements as control is continuously transferred throughout the contract period. Revenue from certain contracts is recognized over the expected period of performance using a single measure of progress, typically based on hours incurred. Payments received in advance of services being rendered are recorded as a component of contract liabilities.

Due to the significant uncertainty associated with the successful development of one or more commercially viable products based on the research efforts and related patent applications, all patent and licensing legal and filing fees and costs related to the development and protection of its intellectual property are charged to operations as incurred.

Patent and licensing legal and filing fees and costs were $13 thousand and $13 thousand for the three months ended June 30, 2026 and 2025, respectively. Patent and licensing legal and filing fees and costs were $29 thousand and $29 thousand for the six months ended June 30, 2026 and 2025, respectively. Patent and licensing legal and filing fees and costs are included in general and administrative costs.