NOTE 1 – OPERATIONS AND LIQUIDITY

Newton Golf Company, Inc. (“we,” or the “Company”) was formed in 2018 as Sacks Parente Golf, Inc., a Delaware limited liability company. On March 18, 2025, the Company converted into a Delaware corporation named Newton Golf Company, Inc. Pursuant to our Plan of Conversion, on March 18, 2025, all of the outstanding ownership interests in Sacks Parente Golf, Inc., and rights to receive such interest were converted into and exchanged for shares of capital stock of Newton Golf Company, Inc. The Company retroactively reflected the conversion as of the earliest periods presented herein.

On March 11, 2025, the Company’s Board of Directors approved and, by written consent dated February 26, 2025, the holders of a majority of our common stock approved an amendment to our Certificate of Incorporation to change our name from Sacks Parente Golf, Inc. to Newton Golf Company, Inc. to better reflect its commitment to revolutionizing golf through advanced physics and precision engineering. The change to Newton Golf Company, Inc. became effective on March 17, 2025.

The Company designs, manufactures, and sells performance golf equipment, including premium golf shafts and putters. The Company’s Newton Motion shaft product line represents a core component of its product strategy.

In April 2022, the Company expanded its manufacturing capabilities by opening a shaft manufacturing facility in St. Joseph, Missouri, to support the production of advanced carbon fiber golf shafts. The Company seeks to manufacture and assemble substantially all of its products in the United States of America where economically feasible, which management believes provides supply chain advantages and greater control over product quality and manufacturing processes.

The Company sells its products through a combination of direct-to-consumer channels, including its websites, as well as through resellers, professional club fitters, distributors, and golf retailers. The Company currently distributes products primarily in the United States, with additional distribution in Japan and South Korea.

The Company may expand its product offerings over time through internal product development, strategic partnerships, or acquisitions of complementary golf-related product lines or technologies.

Basis of Presentation

The condensed financial statements as of June 30, 2026, and for the three and six months ended June 30, 2026 and 2025, are unaudited. In the opinion of management of the Company, all adjustments, including normal recurring accruals, have been made that are necessary to present fairly the financial position of the Company as of June 30, 2026, and the results of its operations for the three and six months ended June 30, 2026 and 2025, and its cash flows for the six months ended June 30, 2026 and 2025. Operating results for the interim periods presented are not necessarily indicative of the results expected for a full fiscal year. The balance sheet as of December 31, 2025 has been derived from the Company’s audited financial statements at such date.

The condensed financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. These condensed financial statements should be read in conjunction with the financial statements and other information included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, as filed with the SEC.

Going Concern and Liquidity

The accompanying condensed financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying condensed financial statements, during the six months ended June 30, 2026, the Company incurred a net loss of $4,937,000, used cash in operations of $2,815,000 and had a stockholders’ deficiency of $3,499,000. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of the condensed financial statements being issued. These condensed financial statements do not include adjustments relating to the recoverability and classification of reported asset amounts or the amount and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

In addition, the Company’s independent registered public accounting firm, in its report on the Company’s financial statements for the year ended December 31, 2025, included an explanatory paragraph regarding substantial doubt about the Company’s ability to continue as a going concern. These condensed financial statements do not include any adjustments that might result from this uncertainty.

As of June 30, 2026, the Company had cash and cash equivalents on hand in the amount of $442,000. Management currently expects that its existing cash resources, together with recent financing activities, including the private placement financing completed on August 14, 2026, will only fund operations for a limited period and that additional financing will be required to support ongoing operations.

On October 24, 2025, the Company entered into an At-The-Market Sales Offering Agreement (“ATM Offering Agreement”) with Kingswood Capital Partners, LLC (“Kingswood”), permitting the Company to sell up to $10.0 million of its common stock pursuant to its effective shelf registration statement on Form S-3 (the “ATM”). The ATM Offering Agreement provides a potential source of liquidity; however, the amount of capital the Company can raise under the program will depend on market conditions and investor demand.

On March 16, 2026, the Company entered into a securities purchase agreement (the “Purchase Agreement”), pursuant to which the Company agreed to issue, at one or more closings, unsecured promissory notes in an aggregate funded amount of up to $2,000,000 (the “Convertible Notes”) and warrants to purchase shares of the Company’s common stock at an exercise price of $1.75 per share (the “Warrants”), subject to adjustment from time to time. In connection with the initial closing on March 16, 2026, the Company issued a Convertible Note to entities affiliated with a member of the Company’s Board of Directors in the aggregate principal amount of $500,000. During the second quarter of 2026, the Company issued additional Convertible Notes in the aggregate principal amount of $1,750,000 to unrelated third-party investors pursuant to the Purchase Agreement (see Notes 8 and 9).

On July 1, 2026, the Company entered into a Loan and Security Agreement providing for a senior secured revolving credit facility of up to $5.0 million. The facility matures on July 1, 2028 and bears interest at Daily Simple SOFR plus 13%. Borrowings are secured by substantially all of the Company’s assets and are available in minimum advances of $200,000, subject to the terms and conditions of the agreement. The proceeds may be used for working capital, capital expenditures, growth initiatives and other general corporate purposes.

On July 7, 2026, holders of approximately $2.3 million of outstanding convertible promissory notes, including accrued interest, exchanged such indebtedness for Series A Convertible Preferred Stock. Management believes this transaction improved the Company’s balance sheet by reducing outstanding debt obligations and increasing stockholders’ equity.

On August 14, 2026, the Company completed a private placement financing at a purchase price of $1.33 per share for aggregate gross proceeds of approximately $1.0 million and net proceeds of approximately $880,000.

The Company’s ability to continue as a going concern is dependent upon its ability to obtain additional debt or equity financing and achieve improved operating performance. There can be no assurance that such financing will be available on acceptable terms, or at all.

No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company can obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing, or grant unfavorable terms in licensing agreements.

Reverse Stock Splits

On July 18, 2024, the Company filed a Certificate of Amendment to amend its Certificate of Incorporation with the Secretary of State of Delaware to affect a reverse stock split of the Company’s common stock at a ratio of 1-for-10 shares (the “First Reverse Stock Split”). The First Reverse Stock Split became effective as of 12:01 a.m. Eastern Time on July 30, 2024 and the Company’s common stock began trading on The Nasdaq Capital Market on a post-split basis under its existing trading symbol. As a result of the First Reverse Stock Split, every ten shares of common stock were automatically combined into one share of common stock. The authorized number of shares of common stock was not affected by the First Reverse Stock Split. No fractional shares were issued in connection with the First Reverse Stock Split, as all fractional shares were rounded up to the next whole share.

On March 4, 2025, the Company filed a Certificate of Amendment to amend its Certificate of Incorporation with the Secretary of State of Delaware to affect a reverse stock split of the Company’s common stock at a ratio of 1-for-30 shares (the “Second Reverse Stock Split” and together with the First Reverse Stock Split, the “Reverse Stock Splits”). The Second Reverse Stock Split became effective as of 12:01 a.m. Eastern Time on March 17, 2025 and the Company’s common stock began trading on The Nasdaq Capital Market on a post-split basis under its existing trading symbol. As a result of the Second Reverse Stock Split, every 30 shares of common stock were automatically combined into one share of common stock. The authorized number of shares of common stock was not affected by the Second Reverse Stock Split. No fractional shares were issued in connection with the Second Reverse Stock Split, as all fractional shares were rounded up to the next whole share.

Accordingly, all share and per share amounts presented herein with respect to common stock have been retroactively adjusted to reflect the Reverse Stock Splits for all periods presented. Proportionate adjustments for the Reverse Stock Splits have been made to the per share exercise price and the number of shares issuable upon the exercise of warrants, the number of shares reserved for issuance under the Company’s equity plans, and all the then outstanding awards under the Company’s equity plans. The Reverse Stock Splits did not change the par value of the common stock or modify any voting rights or other terms of common stock.