4. Reverse Recapitalization

Transaction overview

On June 30, 2026 (the “Closing Date”), Brag House Holdings Inc. (“Legal Acquirer”) completed the transactions contemplated by the Merger Agreement, dated October 12, 2025, as amended (the “Merger Agreement”), by and among Brag House Holdings, Inc. (“Brag House”), House of Doge Inc., a Texas corporation (“Legacy House of Doge” or “HOD”), and Brag House Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Brag House (“Merger Sub”) (collectively, the “Transaction”).

Pursuant to the Merger Agreement, Merger Sub merged with and into Legacy House of Doge, with Legacy House of Doge continuing as the surviving corporation and becoming a wholly owned subsidiary of Brag House. In connection with the closing of the Merger, Brag House changed its corporate name to “House of Doge Inc.” Unless the context otherwise requires, references to the “Company” following the Merger refer to House of Doge Inc., formerly known as Brag House Holdings, Inc., together with its consolidated subsidiaries. The Company’s common stock commenced trading on Nasdaq under the symbol “HODO” on July 1, 2026.

The Transaction was completed on June 30, 2026, which is the acquisition date for accounting purposes. Accordingly, the accompanying unaudited interim condensed consolidated financial statements include:

The historical financial statements of Brag House before the closing date are not reflected as the historical financial statements of the Combined Company, except for Brag house’s net assets acquired in the Transaction. Because the Transaction was accounted for as a reverse recapitalization and not as a business combination, the Company has not presented supplemental pro forma revenue and earnings information as though the Transaction had occurred at the beginning of the comparative periods under the business-combination disclosure requirements of ASC 805

Accounting treatment

Although Brag House was the legal acquirer in the Transaction, HOD was determined to be the accounting acquirer based on the evaluation of the facts and circumstances under Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. The factors considered in identifying HOD as the accounting acquirer included, among other things:

Management determined that Brag House did not meet the definition of a business under ASC 805 as of the closing date because substantially all the fair value of the gross assets acquired is concentrated in one identifiable asset (“screen test”).

Management also considered whether the Transaction should be accounted for as a reverse asset acquisition. After eliminating reciprocal intercompany balances, the acquired set consisted principally of Brag House’s monetary and financial assets and liabilities and did not include substantive nonfinancial assets, an organized workforce or operating processes. Accordingly, the Transaction did not represent the acquisition of an operating asset or asset group and was, in substance, a capital transaction through which HOD obtained Brag House’s net assets and public-company capital structure.

As a result, the Transaction was accounted for as a reverse recapitalization rather than as a business combination or reverse asset acquisition. For accounting purposes, the Transaction was treated as the equivalent of HOD issuing shares for the net assets of Brag House, accompanied by a recapitalization.

The net assets of Brag House were recognized at their historical carrying amounts as of the closing date. No goodwill or other intangible assets were recognized. The excess of the fair value of the equity instruments deemed issued by HOD over the carrying value of the identifiable net assets of Brag House, after consideration of transaction costs, was recognized as equity in the unaudited interim condensed consolidated statements of financial position.

HOD is considered the predecessor of the Combined Company for financial reporting purposes. Accordingly, the assets, liabilities and results of operations of HOD before the closing date are presented as those of the Combined Company. The Combined Company’s capital structure has been retrospectively recast for all periods presented to reflect the number of shares of the legal parent issued to HOD’s former shareholders in connection with the Transaction.

Reverse Stock Split

On June 1, 2026 and prior to the completion of the Merger, the Company effected a 1-for-8 reverse stock split of its outstanding shares of common stock pursuant to a Certificate of Amendment to its Certificate of Incorporation filed with the Secretary of State of the State of Delaware on May 29, 2026. The reverse stock split was approved by the Company’s stockholders at a special meeting held on April 7, 2026, which authorized the Company’s Board of Directors to implement a reverse stock split within a range of 1-for-5 to 1-for-50. The Board subsequently approved a 1-for-8 reverse stock split.

The reverse stock split became effective at 5:00 a.m. Eastern Time on June 1, 2026, and the Company’s common stock began trading on a split-adjusted basis on The Nasdaq Capital Market under the existing ticker symbol, “TBH” at the opening of trading on the same date.

As a result of the reverse stock split, every eight issued and outstanding shares of common stock were automatically combined into one share of common stock. The reverse stock split did not affect the number of authorized shares of common stock or the par value of the common stock. No fractional shares were issued in connection with the reverse stock split. Stockholders who otherwise would have been entitled to receive a fractional share received a cash payment in lieu of such fractional share.

The reverse stock split also resulted in proportionate adjustments to the number of shares of common stock issuable upon the exercise or conversion of the Company’s outstanding equity awards, warrants, convertible securities, and other equity-linked instruments, as well as corresponding adjustments to the applicable exercise or conversion prices, in accordance with the terms of the respective instruments.

All references to quantities of stock throughout this document are effected for this reverse stock split and presented with the current quantities. This change was also applied retrospectively to all share and per-share amounts.

Transaction consideration and capitalization

Immediately before the closing, the Legacy HOD common shares and Legacy HOD restricted stock units (“RSUs”) were converted using the 1.800385 exchange ratio as adjusted for 1-for-8 reverse stock split.

The following table summarizes the common shares and Series C preferred shares issued in connection with the Transaction:

A total of 10,248,274 shares of HOD common stock were converted into series C preferred stock at an exchange ratio of 1:5,000,000.

The exchange ratio was applied retrospectively to HOD’s historical:

The par value of the Combined Company’s common stock was retrospectively reflected for all periods presented. The difference between the par value of the Combined Company’s common stock and the historical par value of HOD’s equity was recorded as an adjustment to additional paid-in capital.

Net assets acquired

The following table presents the historical carrying amounts of Brag House’s net assets recognized by the Combined Company as of the closing date:

The amounts above reflect the historical carrying amounts of Brag House’s assets and liabilities as of the transaction date, consistent with the treatment for a reverse capitalization. The $10,288,722 intercompany receivable and Legacy HOD’s corresponding payable were eliminated upon consolidation. The $668,041 net asset contribution was reflected as $554 of common stock, $666,253 of additional paid-in capital and $1,234 of common stock subscribed but unissued.

Transaction costs

Prior to the Merger, Brag House incurred transaction costs of $3,112,707 consisting primarily of legal fees. Brag House recognized these costs as listing or transaction expenses in its separate pre-Merger financial records. Because Brag House was the accounting acquiree, the expense recognized before the acquisition date is not included in the Company’s consolidated results of operations. At June 30, 2026, $3,062,707 of these costs remained unpaid.

Legacy HOD incurred $900,834 of transaction costs directly attributable to the reverse recapitalization. These costs were recorded as a reduction of additional paid-in capital and reduced the additional paid-in capital recognized in connection with the net assets acquired. Transaction costs were accounted for based on the nature of the underlying transaction to which they were directly attributable as summarized below:

At June 30, 2026, $3,062,707 of unpaid Brag House transaction costs were included within the $5,751,343 of accounts payable and accrued liabilities recognized in the acquired net-assets table above and in the accompanying unaudited interim condensed consolidated balance sheet. Legacy HOD’s transaction costs, remained accrued at June 30, 2026 and was included in accounts payable and accrued liabilities before the Merger.

Warrants

Upon closing, the Company assumed warrants to purchase an aggregate of 4,634,584 shares of common stock, including:

The Company evaluated the warrants under ASC 480, Distinguishing Liabilities from Equity, and ASC 815, Derivatives and Hedging, and classified the warrants as equity and liabilities, as applicable.

For liability classification: The warrant liabilities were initially recognized at fair value on the closing date and are re-measured at fair value at each reporting date, with changes in fair value recognized in earnings. The warrant liabilities had an aggregate fair value of approximately $2,837,274 at June 30, 2026, which is the closing date. The Company did not recognize a change in fair value during the three months ended June 30, 2026 since this was the closing date and the warrant liabilities were consolidated at fair value on that date.

See Note 10 - Short-Term Debt, Note 11 - Capital Stock, and Note 15 - Fair Value Measurements and Financial Risk Management, for additional information.

Presentation of stockholders’ equity

The consolidated statements of stockholders’ equity have been retrospectively recast to reflect the legal capital structure of the Combined Company following the Merger.

Brag House’s pre-Merger equity accounts were eliminated and replaced with Legacy HOD’s historical equity accounts, as retrospectively recast, together with the net asset contribution, transaction costs and the 5,539,281 legacy Brag House common shares included at closing

Cash flow impact

At closing, the Company acquired cash of $46,019 and paid transaction costs of $900,834 related to the reverse recapitalization, resulting in a net cash outflow of $854,815. The cash acquired and transaction costs paid are presented separately within financing activities in the accompanying unaudited condensed consolidated statement of cash flows. Other assets and liabilities recognized in the Merger, including the elimination of intercompany balances, are presented as supplemental noncash financing information.

See Note 3 - Going Concern, for additional information.