UNITED ~~STATES~~ ~~SECURITIES AND EXCHANGE COMMISSION~~STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________.

Commission File Number: 001-39933

URBAN-GRO, INC.

(Exact name of registrant as specified in its charter)

Delaware		46-5158469
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1751 Panorama Point, Unit G Lafayette, CO		80026		(720) 390-3880
(Address of principal executive offices)		(Zip Code)		(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.001 par value		UGRO		NASDAQ Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s only class of common stock outstanding as of February 617, 2026 was ~~18,790,550 shares, or~~ 751,622 shares after giving effect to a 1-for-25 reverse stock split that was effective on February 9, 2026.

TABLE OF CONTENTS

Item No.		Page No.
	PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Unaudited Condensed Consolidated Balance Sheets	1
	Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss	2
	Unaudited Condensed Consolidated Statements of Stockholders’ Deficit	3
	Unaudited Condensed Consolidated Statements of Cash Flows	4
	Notes to Unaudited Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2527
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2629
Item 4.	Controls and Procedures	2729
	PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	2830
Item 1A.	Risk Factors	3032
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3032
Item 3.	Defaults Upon Senior Securities	3032
Item 4.	Mine Safety Disclosures	3032
Item 5.	Other Information	3032
Item 6.	Exhibits	3132
	Signatures	3233

CAUTIONARY INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including statements related to future events, challenges we may face, business strategy, future performance, future operations, backlog, financial position, estimated or projected revenues and losses, projected costs, prospects, plans and objectives of management. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek,” “anticipate,” “plan,” “continue,” “estimate,” “expect,” “may,” “will,” “project,” “predict,” “potential,” “intend,” “could,” “should,” “believe,” and variations of such words or their negative and similar expressions. Forward-looking statements should not be read as a guarantee of future performance or results and may not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on management’s belief, based on currently available information, as to the outcome and timing of future events. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those expressed in such forward-looking statements. When evaluating forward-looking statements, you should consider the risk factors and other cautionary statements described in this Quarterly Report on Form 10-Q and under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. We believe the expectations reflected in the forward-looking statements contained in this report are reasonable, but no assurance can be given that these expectations will prove to be correct. Forward-looking statements should not be unduly relied upon. Important factors that could cause actual results or events to differ materially from those expressed in forward-looking statements include, but are not limited to:

●

risks related to our operating strategy;

●

competition for projects in our markets;

●

our ability to predict and respond to new laws and governmental regulatory actions affecting our business, including foreign laws and governmental regulation;

●

risks related to delays in the grant of necessary licenses to clients and delays in passage of legislation expected to benefit our clients, which could delay the funding and start of projects

●

our ability to successfully develop new and/or enhancements to our product offerings and develop a product mix to meet demand;

●

our ability to meet or exceed market expectations from analysts;

●

unfavorable economic conditions, increases in interest rates and restrictive financing markets that may cause customers to cancel contracts reflected in our backlog or cause sales to decrease;

●

our ability to successfully identify, manage and integrate acquisitions;

●

our ability to accurately estimate the overall risks, requirements or costs when we bid on or negotiate contracts that are ultimately awarded to us;

●

climate change and related laws and regulations;

●

our ability to manage our supply chain in a manner that ensures that we are able to obtain adequate raw materials, equipment and essential supplies in a timely manner and at favorable prices;

●

our ability to attract and retain key personnel;

●

risks associated with concentration of a large portion of our business from a relatively small number of key clients/customers and the effect a loss of a key client/customer could have on our business;

●

risks associated with customers or suppliers not fulfilling contracts;

●

risks associated with reliance on key suppliers and risks such suppliers could change incentive programs that negatively affect our returns;

●

the impact of inflation on costs of labor, raw materials and other items that are critical to our business;

●

property damage and other claims and insurance coverage issues;

These factors are not necessarily all of the important factors that could cause actual results or events to differ materially from those expressed in the forward-looking statements. Other unknown or unpredictable factors could also cause actual results or events to differ materially from those expressed in the forward-looking statements. Our future results will depend upon various other risks and uncertainties, including those described in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. All forward-looking statements attributable to us are qualified in their entirety by this cautionary statement. Forward-looking statements speak only as of the date hereof. We undertake no obligation to update or revise any forward-looking statements after the date on which any such statement is made, whether as a result of new information, future events or otherwise, except as required by law. You are advised, however, to consult any future disclosures we make on related subjects in future reports to the Securities and Exchange Commission (SEC).

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

URBAN-GRO, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30,			December 31,
	September 30,			December 31,
	2025			2024
	(Unaudited)			(Audited)
ASSETS
Current assets:
Cash	$	~~721~~62,~~249~~875		$	819,050
Accounts receivable, net		3352,~~059,193~~307			86,~~369~~104,~~116~~926
Contract Receivables		1,691,483			4,132,817
Contract receivables		270,899			4,132,817
Prepaid expenses and other current assets		1,~~936~~521,~~219~~733			2,~~486~~479,~~865~~262
Total current assets		7,408,144			15,807,848
Current assets of discontinued operations		-			2,271,793
Total current assets		2,207,814			15,807,848
Non-current assets:
Property and equipment, net		~~762~~566,~~651~~609			~~921~~813,~~957~~452
Operating lease right-of-use assets		~~569~~395,~~428~~058			1550,~~534,560~~175
Goodwill		1,080,638			1,080,638
Non-current assets of discontinued operations		-			2,322,308
Intangible assets, net		98,880			148,780
Total non-current assets		961,667			3,685,935
Total non-current assets		2,511,597			3,685,935
Total assets	$	3,169,481		$	19,493,783
Total assets	$	9,919,741		$	19,493,783
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	1817,~~842~~529,~~196~~930		$	1413,~~724~~518,~~589~~626
Contract liabilities		11,~~550~~380,~~346~~224			14,094,176
Accrued expenses		4,~~523~~589,~~586~~984			4,~~277~~017,~~545~~145
Customer deposits		42,~~236~~754,~~913~~175			2,~~682~~628,~~099~~463
Notes payable, current		43,~~089~~814,~~203~~562			5,968,145
Operating lease liabilities, current		~~368~~246,~~755~~391			~~552~~235,~~933~~223
Total current liabilities		43,610,999			42,299,487
Current liabilities of discontinued operations		1,592,718			1,837,709
Total current liabilities		41,907,984			42,299,487
Non-current liabilities
Notes payable, long-term		~~323,510~~-			795,531
Deferred tax liability		-			14,608
Operating lease liabilities, long-term		~~221~~168,~~942~~039			1336,~~026,699~~255
Total non-current liabilities		545,452			1,836,838
Non-current liabilities of discontinued operations		-			690,444
Total liabilities		44,156,451			44,136,325
Total non-current liabilities		168,039			1,836,838
Total liabilities		42,076,023			44,136,325
Commitments and contingencies
Stockholders’ deficit:
Preferred stock, $0.10 par value; 3,000,000 shares authorized; 0 shares issued and outstanding as of June 30, 2025 and December 31, 2024		-			-
Preferred stock, $0.10 par value; 3,000,000 shares authorized; 0 shares issued and outstanding as of September 30, 2025 and December 31, 2024		-			-
Common stock, $0.001 par value 200,000,000 shares authorized; 587,278 issued and 529,285 outstanding as of June 30, 2025, and 562,855 issued and 504,862 outstanding as of December 31, 2024		588			563
Common stock, $0.001 par value 200,000,000 shares authorized; 587,598 issued and 529,605 outstanding as of September 30, 2025, and 562,855 issued and 504,862 outstanding as of December 31, 2024		588			563
Additional paid-in capital		90,~~814~~984,~~508~~530			90,170,645
Treasury shares, cost basis: 57,993 shares as of June 30, 2025 and December 31, 2024		(12,045,542	)		(12,045,542	)
Treasury shares, cost basis: 57,993 shares as of September 30, 2025 and December 31, 2024		(12,045,542	)		(12,045,542	)
Accumulated deficit		(~~113~~117,~~006~~846,~~264~~118	)		(102,768,208	)
Total stockholders’ deficit		(3438,~~236~~906,~~710~~542	)		(24,642,542	)
Total liabilities and stockholders’ deficit	$	93,~~919~~169,~~741~~481		$	19,493,783

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements

URBAN-GRO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2025			2024			2025			2024
Revenues
Equipment	$	3866,~~128,746~~173		$	3,~~398~~720,~~696~~174		$	78,~~827~~693,~~323~~496		$	59,~~904~~624,~~345~~514
Services		1,099,378			2,357,806			2,748,476			5,491,598
Construction design-build		1,408,556			4,172,110			8,043,505			25,915,018
Construction design-build		3,512,650			12,059,096			6,634,948			21,742,909
Other		108,765			83,727			178,195			291,161
Other		25,328			129,651			69,430			207,434
Total revenues		2,383,494			7,976,011			16,915,196			35,830,693
Total revenues		7,766,102			17,945,249			17,280,177			33,346,286
Cost of revenue
Equipment		2777,~~995,183~~784			23,~~753~~290,~~497~~624			78,~~339~~127,~~790~~289			48,~~923~~214,~~608~~233
Services		1,060,162			1,513,715			2,111,308			3,022,163
Construction design-build		1,684,747			3,932,699			8,795,757			23,789,045
Construction design-build		3,646,334			11,181,017			7,120,721			19,856,346
Other		92,714			57,935			146,306			200,328
Other		19,680			86,704			53,593			142,393
Total cost of revenue		2,555,245			7,281,258			17,069,352			32,203,606
Total cost of revenue		7,721,359			15,534,933			16,625,412			27,944,510
Gross profit		(171,751	)		694,753			(154,156	)		3,627,087
Gross profit		44,743			2,410,316			654,765			5,401,776
Operating expenses:
General and administrative		51,~~805~~973,~~180~~518			43,~~668~~599,~~954~~544			1011,~~322~~133,~~683~~852			911,~~746~~689,~~820~~281
Depreciation and amortization		~~147~~90,~~587~~337			~~395~~304,~~696~~049			~~315~~324,~~281~~414			~~785~~929,~~947~~526
Business development		~~47,950~~-			~~25,000~~-			47,950			25,000
Total operating expenses		62,~~000~~063,~~717~~855			53,~~089~~903,~~650~~593			1011,~~685~~506,~~914~~216			1012,~~557~~643,~~767~~807
Loss from operations		(52,~~955~~235,~~974~~606	)		(23,~~679~~208,~~334~~840	)		(1011,~~031~~660,~~149~~372	)		(59,~~155~~016,~~991~~720	)
Non-operating income (expense):
Interest expense		(~~260~~513,~~590~~005	)		(~~311~~220,~~706~~472	)		(~~715~~1,~~214~~228,221	)		(~~411~~631,~~010~~484	)
Interest income		~~201~~57			~~155~~285			~~469~~526			~~236~~521
Gain on extinguishment of debt		~~7,476~~-			-			7,476			-
Other income (expense)		4,743			(22,226	)		485,754			(55,291	)
Loss on settlement		(62,850	)		-			(62,850	)		-
Total non-operating income (expense)		(248,170	)		(333,777	)		(221,515	)		(466,065	)
Loss on assets foreclosure		(2,265,290	)		-			(2,265,290	)		-
Loss before income taxes		(6,204,144	)		(3,013,111	)		(10,252,664	)		(5,622,056	)
Other income (expense)		53,971			(33,026	)		539,725			(88,318	)
Income tax benefit		-			48,383			14,608			96,765
Total non-operating income (expense)		(2,787,117	)		(253,213	)		(3,008,634	)		(719,281	)
Net loss	$	(6,204,144	)	$	(2,964,728	)	$	(10,238,056	)	$	(5,525,291	)
Loss before income taxes		(5,022,723	)		(3,462,053	)		(14,669,006	)		(9,736,001	)
Comprehensive loss	$	6,204,144		$	(2,964,728	)	$	(10,238,056	)	$	(5,525,291	)
Income tax benefit		-			-			14,608			69,396
Net loss per common share - basic and diluted	$	(10.64	)	$	(5.99	)	$	(17.65	)	$	(11.19	)
Net loss from continuing operations		(5,022,723	)		(3,462,053	)		(14,654,398	)		(9,666,605	)
Weighted average common shares outstanding - basic and diluted		583,352			494,820			579,962			493,580
Net income (loss) from discontinued operations, net of tax		182,869			(295,755	)		(423,512	)		383,506
Net loss	$	(4,839,854	)	$	(3,757,808	)	$	(15,077,910	)	$	(9,283,099	)
Net loss per share attributable to common stockholders:
Net loss from continuing operations	$	(9.48	)	$	(6.97	)	$	(27.94	)	$	(19.73	)
Net income (loss) from discontinued operations, net of taxes	$	0.35		$	(0.60	)	$	(0.81	)	$	0.78
Net loss per share	$	(9.14	)	$	(7.56	)	$	(28.75	)	$	(18.95	)
Weighted average common shares outstanding - basic and diluted		529,643			496,937			524,501			489,981

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements

URBAN-GRO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT (unaudited)

					Additional									Total Stockholders’
	Common Stock				Additional Paid-in			Accumulated			Treasury			Total Stockholders’ Equity
	Common Stock				Paid-in			Accumulated			Treasury			Equity
	Shares		Amount		Capital			Deficit			Stock			(Deficit)
Balance at December 31, 2023		540,906	$	541	$	88,402,738		$	(66,272,382	)	$	(12,045,542	)	$	10,085,355
Balance at December 31,2023		540,906	$	541	$	88,402,738		$	(66,272,382	)	$	(12,045,542	)	$	10,085,355
Stock-based compensation		-		-		656,576			-			-			656,576
Stock grant program vesting		9,837		10		(10	)		-			-			-
Net loss		-		-		-			(2,560,563	)		-			(2,560,563	)
Balances at March 31, 2024		550,743		551		89,059,304			(68,832,945	)		(12,045,542	)		8,181,368
Stock-based compensation		-		-		460,785			-			-			460,785
Stock grant program vesting		6,902		7		(7	)		-			-			-
Stock issued for contingent consideration		2,848		3		129,132			-			-			129,135
Net loss		-		-		-			(2,964,728	)		-			(2,964,728	)
Balances at June 30, 2024		560,493	$	561		89,649,214		$	(71,797,673	)	$	(12,045,542	)	$	5,806,560
Stock-based compensation		-		-		343,884			-			-			343,884
Stock grant program vesting		2,041		2		(2	)		-			-			-
Net loss		-		-		-			(3,757,808	)		-			(3,757,808	)
Balances at September 30, 2024		562,534	$	563	$	89,993,096		$	(75,555,481	)	$	(12,045,542	)	$	2,392,636
Balance at December 31, 2024		562,855	$	563	$	90,170,645		$	(102,768,208	)	$	(12,045,542	)	$	(24,642,542	)
Stock-based compensation		3,000		3		324,268			-			-			324,271
Stock grant program vesting		10,559		11		(11	)		-			-			-
Issuance of common stock for loan modification		6,000		6		109,418			-			-			109,424
Net loss		-		-		-			(4,033,912	)		-			(4,033,912	)
Balances at March 31, 2025		582,414		583		90,604,320			(106,802,120	)		(12,045,542	)		(28,242,759	)
Stock-based compensation		-		-		210,193			-			-			210,193
Stock grant program vesting		4,864		5		(5	)		-			-			-
Net loss		-		-		-			(6,204,144	)		-			(6,204,144	)
Balances at June 30, 2025		587,278	$	588		90,814,508		$	(113,006,264	)	$	(12,045,542	)	$	(34,236,710	)
Stock-based compensation		-		-		170,022			-			-			170,022
Stock grant program vesting		320		-		-			-			-			-
Net loss		-		-		-			(4,839,854	)		-			(4,839,854	)
Balances at September 30, 2025		587,598	$	588		90,984,530		$	(117,846,118	)	$	(12,045,542	)	$	(38,906,542	)

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements

URBAN-GRO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

	Six Months Ended
	Nine Months Ended September 30,
	June 30,
	2025			2024
Cash flows from operating activities:
Net loss	$	(1014,~~238~~654,~~056~~398	)	$	(59,~~525~~666,~~291~~605	)
Adjustments to reconcile net loss to net cash provided by (used) in operating activities:
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		~~315~~324,~~281~~414			~~785~~929,~~947~~526
Amortization of right-of-use assets		~~182~~144,~~736~~160			~~263~~108,~~775~~753
Stock-based compensation expense		~~534~~704,~~464~~486			1,~~117~~461,~~361~~245
Amortization of debt discounts		78144,~~093~~296			-
Common stock issued for debt modification		109,424			-
Gain on disposition of assets		(120,591	)		-
Asset foreclosure loss		2,265,290			-
Gain on disposition of assets		(67,611	)		-
Changes in operating assets and liabilities:
Accounts receivable and contract receivables		76,~~770~~918,~~403~~393			(6,~~134~~901,~~794~~718	)
Prepaid expenses and other assets		~~832~~1,~~966~~239,849			(~~696~~1,~~442~~929,839	)
Accounts payable, contract liabilities, customer deposits and accrued expenses		32,~~381~~363,~~098~~429			87,~~741~~412,~~425~~367
Operating lease liability		(~~203~~146,~~308~~091	)		(~~216~~87,~~203~~098	)
Deferred tax liability		(14,608	)		(9672,~~765~~396	)
Net cash provided by (used in) operating activities		2,627,902			(1,760,987	)
Net cash provided by (used in) operating activities of continuing operations		(668,967	)		5,057,671
Net cash provided by (used in) operating activities of discontinued operations		1,112,054			(5,804,595	)
Net cash provided by (used in) operating activities		443,087			(746,924	)
Cash flows from investing activities:
Proceeds from the sale of property and equipment		123,100			-
Purchase of property and equipment		(113,219	)		(4597,~~999~~578	)
Net cash (used in) provided by investing activities		9,881			(45,999	)
Net cash (used in) provided by investing activities of continuing operations		9,881			(97,578	)
Net cash (used in) provided by investing activities of discontinuing operations		2,031,735			-
Net cash (used in) provided by investing activities		2,041,616			(97,578	)
Cash flows from financing activities:
Proceeds from promissory notes		1,~~197~~000,000			45,~~500~~838,000
Repayments of notes payable		(34,~~914~~321,~~840~~286	)		(34,~~300~~808,~~350~~921	)
Repayment of finance lease liability		(1710,~~744~~957	)		(8293,~~710~~152	)
Net cash (used in) provided by financing activities		(2,735,584	)		1,116,940
Net cash (used in) provided by financing activities of continuing operations		(3,332,243	)		935,927
Net change in cash		(97,801	)		(690,046	)
Net cash (used in) provided by financing activities of discontinuing operations		91,365			(29,427	)
Net cash (used in) provided by financing activities		(3,240,878	)		906,500
Net change in cash		(756,175	)		61,998
Cash at beginning of period		819,050			1,074,842
Cash at end of period	$	~~721~~62,~~249~~875		$	~~384~~1,~~796~~136,840
Supplemental disclosure of cash flow information:
Cash paid for interest	$	~~361~~794,~~554~~881		$	399,218
Cash paid for income taxes	$	-		$	24,785
Supplemental disclosure of non-cash investing and financing activities:
Termination of operating lease	$	767,884		$	-
Prepaid expenses financed by notes payable	$	282,320		$	-
Debt discount	$	50,000		$	-
Debt Discount	$	50,000		$	-

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements

URBAN-GRO, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION, ACQUISITIONS, AND LIQUIDITY

Basis of Presentation

These consolidated financial statements are presented in United States dollars and have been prepared in accordance with United States generally accepted accounting principles (“GAAP”). On February 9, 2026, we effected a 1-for-25 reverse stock split with respect to our common stock. All share and per share information in these consolidated financial statements give effect to this reverse stock split, including restating prior period reported amounts.

Organization

urban-gro, Inc. (together with its wholly owned subsidiaries, collectively “urban-gro,” “we,” “us,” or “the Company”) was originally formed on March 20, 2014, as a Colorado limited liability company. On March 10, 2017, we converted to a Colorado corporation and exchanged shares of our common stock for every member’s interest issued and outstanding on the date of conversion. On October 29, 2020, we reincorporated as a Delaware corporation. On February 12, 2021, we completed an uplisting to the Nasdaq Capital Market (“Nasdaq”) under the ticker symbol “UGRO”.

In ~~2024~~ 2025, urban-gro, Inc. was an integrated professional services and design-build firm. We offered value-added architectural, engineering, and construction management solutions to the Controlled Environment Agriculture (“CEA”), industrial, healthcare, and other commercial sectors. Innovation, collaboration, and a commitment to sustainability drove our team to provide exceptional customer experiences. To serve our horticulture clients, we engineered, designed and managed the construction of indoor CEA facilities and then integrate complex environmental equipment systems into those facilities. Through this work, we created high-performance indoor cultivation facilities for our clients to grow specialty crops, including leafy greens, vegetables, herbs, and plant-based medicines. Our custom-tailored approach to design, construction, procurement, and equipment integration provided a single point of accountability across all aspects of indoor growing operations. We also helped our clients achieve operational efficiency and economic advantages through a full spectrum of professional services and programs focused on facility optimization and environmental health which established facilities that allowed clients to manage, operate and perform at the highest level throughout their entire cultivation lifecycle once they are up and running. Further, we served a broad range of commercial and governmental entities, providing them with planning, consulting, architectural, engineering and construction design-build services for their facilities. We aimed to work with our clients from the inception of their project in a way that provided value throughout the life of their facility. We are a trusted partner and advisor to our clients and offer a complete set of engineering and managed services complemented by a vetted suite of select cultivation equipment systems.

~~Liquidity and Going Concern~~Dispositions

~~The Company~~On ~~has~~August ~~produced~~27, ~~multiple~~2025, ~~consecutive~~the ~~years of net losses and negative cash flows from operations. The financial results described~~Company inannounced ~~these~~that ~~financial~~certain ~~statements~~subsidiaries ~~and~~(the ~~our~~“Seller ~~financial~~Parties”) ~~position as~~ of ~~June~~the ~~30,~~Company ~~2025~~entered ~~raise~~into ~~substantial~~a ~~doubt~~Stock ~~about~~and ~~our~~Asset ~~ability~~Purchase ~~to continue as~~Agreement ~~a going concern. However,~~ (the ~~Company~~“August ~~has~~27 ~~recently~~Purchase ~~taken~~Agreement”) ~~actions~~with to2WR ~~strengthen its liquidity~~Holdco, ~~including~~LLC ~~decreasing~~(the ~~headcount~~“Buyer”). ~~and~~Pursuant ~~operating expenses~~ to ~~expedite~~ the ~~Company’s~~August ~~path~~27 toPurchase ~~cash flow positive results. If necessary~~Agreement, the ~~Company~~Buyer ~~will~~acquired ~~seek~~(the to“Acquisition”) ~~raise~~all ~~capital~~of ~~by issuing~~the ~~additional~~outstanding ~~equity~~ shares ~~either~~of ~~through~~stock aof ~~private~~2WR ~~placement~~of orGeorgia, ~~on the open market~~Inc. ~~The Company may also seek to obtain additional~~(“2WRGA”) ~~debt~~and ~~financing~~certain ~~for~~assets ~~which~~of ~~there~~other ~~can~~subsidiaries beof nothe ~~guarantee.~~Company ~~Management~~relating ~~has~~to ~~concluded~~those ~~that~~entities’ ~~these~~business ~~recent~~of ~~positive~~providing ~~steps~~commercial, ~~alleviate any substantial~~industrial ~~doubt~~and ~~about~~municipal ~~the~~architectural ~~Company’s~~and ~~ability~~construction toadministration ~~continue~~services ~~its~~for ~~operations,~~projects ~~and~~not ~~meet~~involving ~~its financial obligations~~CEA, ~~for~~with ~~twelve~~such ~~months~~CEA ~~from~~business ~~the~~being ~~date~~retained ~~these~~by ~~consolidated~~the ~~financial statements are issued~~Company.

5See Note 4 for further detail on the dispositions.

~~NOTE~~Liquidity ~~2 –~~and ~~SUMMARY~~Going ~~OF SIGNIFICANT ACCOUNTING POLICIES~~Concern

~~Unaudited~~The Company has produced multiple consecutive ~~Condensed~~years ~~Consolidated~~of ~~Financial~~net ~~Statements~~losses and negative cash flows from operations. The financial results described in these financial statements and our financial position as of September 30, 2025 raise substantial doubt about our ability to continue as a going concern. However, the Company has recently taken actions to strengthen its liquidity, including decreasing headcount and operating expenses to expedite the Company’s path to cash flow positive results. If necessary, the Company will seek to raise capital by issuing additional equity shares either through a private placement or on the open market. The Company may also seek to obtain additional debt financing for which there can be no guarantee. Management has concluded that these recent positive steps alleviate any substantial doubt about the Company’s ability to continue its operations, and meet its financial obligations, for twelve months from the date these consolidated financial statements are issued.

The Company has prepared the accompanying condensed consolidated financial statements pursuant to the rules and regulations of the SEC for condensed financial reporting. The condensed consolidated financial statements are unaudited and, in the Company’s opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations and comprehensive loss, condensed consolidated statements of stockholders’ equity and condensed consolidated statements of cash flows for the periods presented. The results reported in these condensed consolidated financial statements should not be regarded as necessarily indicative of results that may be expected for the entire year. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted in accordance with regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.5

~~Significant Accounting~~NOTE ~~Policies~~2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

~~For a~~Unaudited ~~detailed~~Condensed ~~discussion~~Consolidated ~~about~~Financial the Company’s significant accounting policies, refer to Note 2 - “Summary of Significant Accounting Policies,” in the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K the year ended December 31, 2024. During the six months ended June 30, 2025, there were no material changes made to the Company’s significant accounting policies.Statements

~~Use~~The Company has prepared the accompanying condensed consolidated financial statements pursuant to the rules and regulations of the SEC for condensed financial reporting. ~~Estimates~~The condensed consolidated financial statements are unaudited and, in the Company’s opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations and comprehensive loss, condensed consolidated statements of stockholders’ equity and condensed consolidated statements of cash flows for the periods presented. The results reported in these condensed consolidated financial statements should not be regarded as necessarily indicative of results that may be expected for the entire year. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted in accordance with regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

In preparing condensed consolidated financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of assets and liabilities at the date of the condensed consolidated financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant ~~estimates~~Accounting include estimated revenues earned under construction design-build contracts; estimated useful lives and potential impairment of long-lived assets, intangibles and goodwill; inventory write-offs; allowance for deferred tax assets; and allowance for bad debt.Policies

~~Balance~~For a detailed discussion ~~Sheet~~about ~~Classifications~~the Company’s significant accounting policies, refer to Note 2 - “Summary of Significant Accounting Policies,” in the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K the year ended December 31, 2024. During the nine months ended September 30, 2025, there were no material changes made to the Company’s significant accounting policies.

~~The Company~~Use includes in current assets and liabilities the following amounts that are in connection with construction contracts that may extend beyond one year: contract assets and contract liabilities (including retainage invoiced to customers contingent upon anything other than the passage of time), capitalized costs to fulfill contracts, retainage payable to sub-contractors and accrued losses on uncompleted contracts. A one-year time period is used to classify all other current assets and liabilities when not otherwise prescribed by the applicable accounting principles.Estimates

~~Contract~~In preparing condensed consolidated ~~Assets~~financial statements in conformity with GAAP, management is required to make estimates and ~~Liabilities~~assumptions that affect the reported amounts of assets and liabilities and the disclosure of assets and liabilities at the date of the condensed consolidated financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include estimated revenues earned under construction design-build contracts; estimated useful lives and potential impairment of long-lived assets, intangibles and goodwill; inventory write-offs; allowance for deferred tax assets; and allowance for bad debt.

~~The timing~~Balance ~~between~~Sheet when the Company invoices for its construction design-build customers can create a contract asset or contract liability. Refer to Note 3 - Revenue from Contracts with Customers for further discussion of the Company’s contract assets and liabilities.Classifications

~~Recently~~The Company includes in current ~~Issued~~assets ~~Accounting~~and ~~Standards~~liabilities the following amounts that are in connection with construction contracts that may extend beyond one year: contract assets and contract liabilities (including retainage invoiced to customers contingent upon anything other than the passage of time), capitalized costs to fulfill contracts, retainage payable to sub-contractors and accrued losses on uncompleted contracts. A one-year time period is used to classify all other current assets and liabilities when not otherwise prescribed by the applicable accounting principles.

~~From time~~Contract toAssets ~~time,~~and the Financial Accounting Standards Board (the “FASB”) or other standards setting bodies issue new accounting pronouncements. The FASB issues updates to new accounting pronouncements through the issuance of an Accounting Standards Update (“ASU”). Unless otherwise discussed, the Company believes that the impact of recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on the Company’s financial statements upon adoption.Liabilities

~~Management has~~The ~~reviewed~~timing ~~all~~between ~~other~~when ~~recently~~the Company ~~issued,~~invoices ~~but~~for ~~not~~its ~~yet~~construction ~~effective,~~design-build ~~accounting~~customers ~~pronouncements~~can ~~and~~create ~~does~~a ~~not~~contract ~~believe~~asset ~~the~~or ~~future~~contract ~~adoption~~liability. ~~of any~~Refer ~~such~~to ~~pronouncements~~Note ~~may~~3 be- ~~expected~~Revenue from toContracts ~~cause~~with aCustomers ~~material~~for ~~impact~~further ondiscussion of the Company’s ~~financial~~contract ~~condition~~assets orand ~~the results of our operations~~liabilities.

6Recently Issued Accounting Standards

~~NOTE~~From 3time to time, the Financial –Accounting ~~REVENUE~~Standards ~~FROM~~Board ~~CONTRACTS~~(the ~~WITH~~“FASB”) ~~CUSTOMERS~~or other standards setting bodies issue new accounting pronouncements. The FASB issues updates to new accounting pronouncements through the issuance of an Accounting Standards Update (“ASU”). Unless otherwise discussed, the Company believes that the impact of recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on the Company’s financial statements upon adoption.

~~The Company~~Management ~~recognizes~~has ~~revenue~~reviewed ~~predominantly~~all other ~~from~~recently ~~the~~issued, ~~sale~~but ofnot ~~equipment~~yet ~~systems~~effective, ~~services,~~accounting ~~construction~~pronouncements ~~design-build,~~ and ~~from~~does ~~other~~not ~~various immaterial~~believe ~~contracts~~the ~~with~~future ~~customers~~adoption ~~from~~of ~~its~~any ~~CEA~~such ~~and~~pronouncements may ~~Commercial~~be ~~sectors.~~expected ~~The~~to ~~table~~cause ~~below~~a ~~presents~~material impact on the ~~revenue~~Company’s byfinancial ~~source~~condition ~~for~~or the ~~six~~results ~~months ended~~of ~~June~~our ~~30, 2025 and 2024:~~operations.

	Three months ended June 30,
	CEA						Commercial						Total
	2025			2024			2025			2024			2025			2024
Equipment systems	$	448,018		$	3,398,696		$	2,680,728		$	-		$	3,128,746		$	3,398,696
Services		-			1,009,450			1,099,378			1,348,356			1,099,378			2,357,806
Construction design-build		3,462,134			9,982,914			50,516			2,076,182			3,512,650			12,059,096
Other		-			129,651			25,328			-			25,328			129,651
Total revenues and other income	$	3,910,152		$	14,520,711		$	3,855,950		$	3,424,538		$	7,766,102		$	17,945,249
Relative percentage		50	%		81	%		50	%		19	%		100	%		100	%

	Six months ended June 30
	CEA						Commercial						Total
	2025			2024			2025			2024			2025			2024
Equipment systems	$	5,133,843		$	5,904,345		$	2,693,480		$	-		$	7,827,323		$	5,904,345
Services		682,714			1,877,357			2,065,762			3,614,241			2,748,476			5,491,598
Construction design-build		6,298,586			10,798,893			336,362			10,944,016			6,634,948			21,742,909
Other		43,298			207,434			26,132			-			69,430			207,434
Total revenues and other income	$	12,158,441		$	18,788,029		$	5,121,736		$	14,558,257		$	17,280,177		$	33,346,286
Relative percentage		70	%		56	%		30	%		44	%		100	%		100	%

NOTE 3 – REVENUE FROM CONTRACTS WITH CUSTOMERS

~~Under ASC~~The ~~Topic~~Company ~~606,~~recognizes ~~Revenue~~revenue predominantly from ~~Contracts with Customers, a performance obligation is a promise in a contract with a customer, to transfer a distinct good or service to~~ the ~~customer.~~sale ~~Equipment systems contracts are lump sum contracts, which require the performance~~ of ~~some,~~equipment ~~or all~~systems, ~~of the obligations under the contract for a specified amount. Service revenue contracts~~services, which include both architectural and engineering designs, generally contain multiple performance obligations which can span across multiple phases of a project and are generally set forth in the contract as distinct milestones. The majority of construction design-build ~~contracts have a single performance obligation~~, asand ~~the~~from ~~promise~~other tovarious ~~transfer~~immaterial ~~the~~contracts ~~individual~~with customers ~~goods or services is not separately identifiable~~ from ~~other~~its ~~promises~~CEA ~~in the contracts~~ and, ~~therefore,~~Commercial ~~not distinct~~sectors. ~~Some~~The ~~contracts~~table ~~have~~below ~~multiple~~presents ~~performance~~the ~~obligations,~~revenue ~~most~~by ~~commonly~~source ~~due~~for to the ~~contract~~three ~~covering~~and ~~multiple phases~~nine ofmonths ~~the~~ended ~~project~~September 30, ~~life~~2025 ~~cycle (design~~ and ~~construction).~~2024:

The transaction price for service contracts and construction design-build contracts is allocated to each distinct performance obligation and recognized as revenue when, or as, each performance obligation is satisfied. When there are multiple performance obligations under the same service contract, the Company allocates the transaction price to each performance obligation based on the standalone selling price. In general, payment is fixed at the time of the contract and are not subject to discounts, incentives, payment bonuses, credits, and penalties, unless negotiated in an amendment.

	Three months ended September 30,
	CEA						Commercial						Total
	2025			2024			2025			2024			2025			2024
Equipment systems	$	463,372		$	3,720,174		$	402,801		$	-			866,173			3,720,174
Construction design-build		1,408,556			(1,105,670	)		-			5,277,780			1,408,556			4,172,110
Other		-			83,727			108,765			-			108,765			83,727
Total revenues and other income	$	1,871,928		$	2,698,231		$	511,566		$	5,277,780		$	2,383,494		$	7,976,011
Relative percentage		79	%		34	%		21	%		66	%		100	%		100	%

	Nine months ended September 30,
	CEA						Commercial						Total
	2025			2024			2025			2024			2025			2024
Equipment systems	$	5,597,216		$	9,624,514		$	3,096,280		$	-			8,693,496			9,624,514
Construction design-build		7,707,143			9,416,279			336,362			16,498,739			8,043,505			25,915,018
Other		43,298			291,161			134,897						178,195			291,161
Total revenues and other income	$	13,347,657		$	19,331,954		$	3,567,540		$	16,498,739		$	16,915,196		$	35,830,693
Relative percentage		79	%		54	%		21	%		46	%		100	%		100	%

~~When establishing~~Under ~~the~~ASC ~~selling~~Topic ~~price~~606, toRevenue from ~~the~~Contracts ~~customer~~with Customers, ~~the~~a ~~Company~~performance ~~uses~~obligation ~~various~~is ~~observable~~a ~~inputs.~~promise ~~For~~in ~~equipment~~a ~~systems~~contract with a customer, ~~the~~to ~~stand-alone~~transfer ~~selling price~~a isdistinct ~~determined~~good byor service ~~forecasting~~to the ~~expected~~customer. ~~costs~~Equipment ofsystems ~~the~~contracts ~~products,~~are ~~and~~lump ~~then~~sum ~~adding~~contracts, inwhich require the ~~appropriate~~performance ~~margins~~of ~~established~~some, byor all, of the obligations under the contract. ~~For~~for ~~service~~a ~~revenues~~specified ~~and~~amount. ~~construction~~Service ~~design-build~~revenue ~~revenues~~contracts, ~~the~~which ~~Company~~include ~~estimates~~both ~~the~~architectural ~~selling~~and ~~price~~engineering bydesigns, ~~reference to certain~~generally ~~physical~~contain ~~characteristics~~multiple ofperformance ~~the~~obligations ~~project,~~ which ~~include~~can ~~the~~span ~~facility~~across ~~size,~~multiple ~~the~~phases ~~complexity~~ of ~~the~~a ~~design,~~project and ~~the~~are ~~mechanical~~generally ~~systems~~set ~~involved, which~~forth ~~are~~in ~~indicative of~~ the ~~scope~~contract as ~~and~~distinct ~~complexity~~milestones. ~~for~~The ~~those~~majority ~~services.~~of ~~Significant~~construction ~~judgments~~design-build ~~are~~contracts ~~typically~~have ~~not~~a ~~required~~single ~~with~~performance ~~respect~~obligation, to as the ~~determination~~promise ofto transfer the ~~transaction~~individual ~~price~~goods ~~based~~or onservices ~~the~~is ~~nature~~not ofseparately ~~the~~identifiable ~~selling~~from ~~prices~~other ofpromises in the ~~products~~contracts and, ~~services~~therefore, ~~delivered~~not ~~and~~distinct. ~~the collectability~~Some ofcontracts ~~those~~have ~~amounts.~~multiple ~~Accordingly~~performance obligations, ~~the~~most ~~Company~~commonly ~~does~~due ~~not~~to ~~consider~~the ~~estimates~~contract covering multiple phases of ~~variable~~the ~~consideration~~project tolife becycle (design ~~constrained~~and construction).

The ~~Company~~ ~~recognizes~~transaction ~~equipment~~price ~~systems,~~for service ~~services,~~contracts and construction design-build ~~revenues~~contracts ~~when the performance obligation with the customer~~ is ~~satisfied.~~allocated ~~For~~to ~~satisfaction~~each ofdistinct ~~equipment~~performance ~~system~~obligation ~~revenues,~~and ~~the~~recognized ~~Company~~as ~~recognizes~~ revenue when, ~~control~~or ofas, ~~the~~each ~~promised~~performance ~~good~~obligation ~~transfers to~~is ~~the~~satisfied. ~~customer,~~When ~~which~~there ~~predominately~~are ~~occurs~~multiple atperformance ~~the~~obligations ~~time~~under ofthe ~~shipment.~~same ~~For~~ service ~~revenues~~contract, the ~~satisfaction~~Company ~~occurs~~allocates as the ~~services~~transaction ~~related~~ price to ~~the~~each ~~distinct~~ performance ~~obligations~~obligation ~~are~~based ~~rendered~~on orthe ~~completed~~standalone inselling ~~exchange~~price. ~~for~~In ~~consideration~~general, inpayment is anfixed ~~amount~~at ~~for which~~ the ~~Company is entitled. The~~ time ~~period between recognition and satisfaction~~ of ~~performance obligations is generally within~~ the ~~same~~contract ~~reporting~~and ~~period; thus, there~~ are nonot ~~material~~subject ~~unsatisfied~~to ordiscounts, ~~partially~~incentives, ~~unsatisfied~~payment ~~performance~~bonuses, ~~obligations~~credits, ~~for~~and ~~product~~penalties, orunless ~~service revenues at the end of~~negotiated ~~the~~in ~~reporting~~an ~~period~~amendment.

Construction design-build revenues are recognized as the Company’s obligations are satisfied over time, using the ratio of project costs incurred to estimated total costs for each contract because of the continuous transfer of control to the customer as all of the work is performed at the customer’s site and, therefore, the customer controls the asset as it is being constructed. This continuous transfer of control to the customer is further supported by clauses in the contract that allow the customer to unilaterally terminate the contract for convenience, pay the Company for costs incurred plus a reasonable profit and take control of any work in process. This cost-to-cost measure is used for our construction design-build contracts because management considers it to be the best available measure of progress on these contracts.7

~~Contract modifications~~When ~~through~~establishing ~~change orders, claims and incentives are routine in~~ the ~~performance of the Company’s construction design-build~~selling ~~contracts~~price to ~~account~~the ~~for~~customer, ~~changes in~~ the ~~contract~~Company ~~specifications~~uses orvarious ~~requirements~~observable inputs. InFor ~~most~~equipment ~~instances~~systems, ~~contract~~the ~~modifications~~stand-alone ~~are~~selling ~~not~~price ~~distinct~~is determined ~~from~~by forecasting the ~~existing~~expected ~~contract~~costs ~~due~~of to the ~~significant~~products, ~~integration~~and ofthen ~~services~~adding ~~provided~~ in the ~~contract~~appropriate ~~and~~margins ~~are~~established ~~accounted~~by ~~for~~the ascontract. aFor ~~modification~~construction ofdesign-build revenues, the ~~existing~~Company ~~contract~~estimates ~~and~~the ~~performance~~selling ~~obligation.~~price ~~Either~~by ~~the~~reference ~~Company~~to orcertain ~~its~~physical ~~customers~~characteristics ~~may~~of ~~initiate~~the ~~change orders~~project, which ~~may include~~ ~~changes~~include inthe ~~specifications~~facility ~~or designs~~size, ~~manner~~the complexity of ~~performance,~~the ~~facilities~~design, ~~equipment,~~and ~~materials,~~the ~~sites~~mechanical ~~and~~systems ~~period~~involved, ofwhich ~~completion~~are indicative of the ~~work.~~ ~~Change~~scope ~~orders~~and ~~that~~complexity for ~~are~~those ~~unapproved~~services. asSignificant tojudgments ~~both price and scope~~ are ~~evaluated~~typically asnot ~~claims.~~required ~~The~~with ~~Company~~respect ~~considers claims~~ to bethe ~~amounts in~~determination ~~excess~~ of ~~approved~~the ~~contract~~transaction ~~prices~~price ~~that~~based on the ~~Company~~nature ~~seeks~~of tothe ~~collect~~selling ~~from~~prices ~~its~~of ~~customers~~the orproducts ~~others~~and ~~for~~services ~~customer-caused~~delivered ~~delays,~~and ~~errors in~~the ~~specifications~~collectability ~~and~~of ~~designs,~~those ~~contract~~amounts. ~~terminations~~Accordingly, ~~change~~the ~~orders that are either in dispute or are unapproved as to both scope and~~Company ~~price,~~does ornot ~~other~~consider ~~causes~~estimates of ~~unanticipated~~variable ~~additional~~consideration ~~contract~~to ~~costs~~be constrained.

The ~~timing~~ ~~of when the~~ Company ~~bills~~recognizes ~~customers~~equipment systems onand ~~long-term~~ construction design-build ~~contracts~~revenues iswhen ~~generally~~the ~~dependent~~performance ~~upon~~obligation ~~agreed-upon~~with ~~contractual terms,~~the ~~which~~customer ~~may~~is ~~include~~satisfied. ~~milestone~~For ~~billings~~satisfaction ~~based on the completion~~ of ~~certain~~equipment system ~~phases~~revenues, of the ~~work,~~Company orrecognizes revenue when ~~services~~control ~~are provided. When as a result~~ of ~~contingencies, billings cannot occur until after~~ the ~~related~~promised ~~revenue~~good ~~has~~transfers ~~been~~to ~~recognized;~~ the ~~result~~customer, iswhich ~~unbilled~~predominately ~~revenue,~~occurs ~~which~~at isthe ~~included~~time inof ~~contract assets~~shipment. ~~Additionally,~~The ~~the~~time ~~Company~~period ~~may~~between ~~receive~~recognition ~~advances~~and orsatisfaction ~~deposits~~of ~~from~~performance ~~customers~~obligations ~~before~~is ~~revenue~~generally iswithin ~~recognized;~~ the ~~result~~same reporting isperiod; ~~deferred revenue~~thus, ~~which~~there isare ~~included~~no inmaterial ~~contract~~unsatisfied ~~liabilities.~~or ~~Retainage~~partially ~~subject~~unsatisfied toperformance ~~conditions~~obligations ~~other~~for ~~than~~product ~~the~~revenues ~~passage~~at ofthe ~~time~~end ~~are~~of ~~included~~the inreporting ~~contract assets and contract liabilities~~period.

~~Contract assets~~Construction ~~represent~~ design-build revenues are recognized inas ~~excess~~the Company’s obligations are satisfied over time, using the ratio of ~~amounts~~project ~~paid~~costs orincurred ~~payable~~to (estimated total costs for each contract ~~receivables)~~because of the continuous transfer of control to the ~~Company~~customer onas ~~uncompleted~~all ~~contracts. Contract~~of ~~liabilities~~the ~~represent~~work is performed at the ~~Company~~customer’s site ~~obligation~~and, therefore, the customer controls the asset as it is being constructed. This continuous transfer of control to ~~perform~~the oncustomer ~~uncompleted~~is further ~~contracts~~supported ~~with~~by ~~customers~~clauses in the contract that allow the customer to unilaterally terminate the contract for ~~which~~convenience, pay the Company ~~has~~for ~~received~~costs ~~payment~~incurred orplus a reasonable profit and take control of any work in process. This cost-to-cost measure is used for ~~which~~our ~~contract~~construction design-build ~~receivables~~contracts ~~are~~because ~~outstanding~~management considers it to be the best available measure of progress on these contracts.

8Contract modifications through change orders, claims and incentives are routine in the performance of the Company’s construction design-build contracts to account for changes in the contract specifications or requirements. In most instances, contract modifications are not distinct from the existing contract due to the significant integration of services provided in the contract and are accounted for as a modification of the existing contract and performance obligation. Either the Company or its customers may initiate change orders, which may include changes in specifications or designs, manner of performance, facilities, equipment, materials, sites and period of completion of the work. Change orders that are unapproved as to both price and scope are evaluated as claims. The Company considers claims to be amounts in excess of approved contract prices that the Company seeks to collect from its customers or others for customer-caused delays, errors in specifications and designs, contract terminations, change orders that are either in dispute or are unapproved as to both scope and price, or other causes of unanticipated additional contract costs.

The timing of when the Company ~~following~~bills ~~table~~customers ~~provides~~on ~~information~~long-term ~~about~~construction ~~contract~~design-build contracts is generally dependent upon agreed-upon contractual terms, which may include milestone billings based on the completion of certain phases of the work, or when services are provided. When as a result of contingencies, billings cannot occur until after the related revenue has been recognized; the result is unbilled revenue, which is included in contract assets. ~~and~~Additionally, the Company may receive advances or deposits from customers before revenue is recognized; the result is deferred revenue, which is included in contract liabilities. ~~from~~Retainage ~~contracts~~subject ~~with~~to ~~customers:~~conditions other than the passage of time are included in contract assets and contract liabilities.

	June 30,		December 31,
	2025		2024
Contract assets
Revenue recognized in excess of amounts paid or payable (contract receivables) to the Company on uncompleted contracts (contract asset), excluding retainage	$	748,244	$	3,757,641
Retainage included in contract assets due to being conditional on something other than solely passage of time		943,239		375,176
Total contract assets	$	1,691,483	$	4,132,817
Contract liabilities
Payments received or receivable (contract receivables) in excess of revenue recognized on uncompleted contracts (contract liability), excluding retainage	$	11,446,965	$	13,930,251
Retainage included in contract liabilities due to being conditional on something other than solely passage of time		103,381		163,925
Total contract liabilities	$	11,550,346	$	14,094,176

Contract assets represent revenues recognized in excess of amounts paid or payable (contract receivables) to the Company on uncompleted contracts. Contract liabilities represent the Company’s obligation to perform on uncompleted contracts with customers for which the Company has received payment or for which contract receivables are outstanding.

For equipment systems contracts, the Company’s predominant policy is to collect deposits from customers at the beginning of the contract and the balance of the contract payment prior to shipping. The Company does, in some cases, collect deposits or retainers as down payments on service contracts. Consumable products orders may be paid for in advance of shipment or for recurring customers with credit, payment terms of 30 days or less may be extended by the Company. Customer payments that have been collected prior to the performance obligation being recognized are recorded as customer deposit liabilities on the balance sheet. When the performance obligation is satisfied and all the criteria for revenue recognition are met, revenue is recognized. In certain situations when the customer has paid the deposit and services have been performed but the customer chooses not to proceed with the contract, the Company is entitled to keep the deposit and recognize revenue.8

~~NOTE~~The 4following table provides information about contract assets –and ~~RELATED~~contract ~~PARTY~~liabilities ~~TRANSACTIONS~~from contracts with customers:

A director of the Company is an owner of Cloud 9 Support, LLC (“Cloud 9”) and Potco LLC (“Potco”). Cloud 9 purchases materials from the Company for use with its customers and Potco purchases equipment from the Company for use in its cultivation facility. Another director of the Company is working on a vertical farming innovation model with a group of CEA experts (the “CEA Consortium”). The CEA Consortium contracts services from the Company related to their business model.

	September 30,		December 31,
	2025		2024
Contract assets
Revenue recognized in excess of amounts paid or payable (contract receivables) to the Company on uncompleted contracts (contract asset), excluding retainage	$	270,899	$	3,757,641

Retainage included in contract assets due to being conditional on something other than solely passage of time		-		375,176
Total contract assets	$	270,899	$	4,132,817

Contract liabilities
Payments received or receivable (contract receivables) in excess of revenue recognized on uncompleted contracts (contract liability), excluding retainage	$	11,276,843	$	13,930,251

Retainage included in contract liabilities due to being conditional on something other than solely passage of time		103,381		163,925
Total contract liabilities	$	11,380,224	$	14,094,176

~~There~~For equipment systems contracts, ~~were~~the noCompany’s ~~material~~predominant ~~revenues~~policy is to collect deposits from ~~related~~customers ~~party~~at ~~entities~~the ~~for~~beginning of the ~~six~~contract ~~months~~and ~~ended~~the ~~June~~balance of the contract payment prior to shipping. The Company does, in some cases, collect deposits or retainers as down payments on service contracts. Consumable products orders may be paid for in advance of shipment or for recurring customers with credit, payment terms of 30 days or less may be extended by the Company. Customer payments that have been collected prior to the performance obligation being recognized are recorded as customer deposit liabilities on the balance sheet. When the performance obligation is satisfied and all the criteria for revenue recognition are met, ~~2025~~revenue is recognized. In certain situations when the customer has paid the deposit and services have been performed but the customer chooses not to proceed with the contract, the Company is entitled to keep the deposit and ~~2024~~recognize revenue.

9NOTE 4 – DISCONTINUED OPERATIONS

~~NOTE~~On 5August 27, 2025, the Company –announced ~~PREPAID~~that ~~EXPENSES~~certain ~~AND~~subsidiaries ~~OTHER~~(the ~~ASSETS~~“Seller Parties”) of the Company entered into a Stock and Asset Purchase Agreement (the “August 27 Purchase Agreement”) with 2WR Holdco, LLC (the “Buyer”). Pursuant to the August 27 Purchase Agreement, the Buyer acquired (the “Acquisition”) all of the outstanding shares of stock of 2WR of Georgia, Inc. (“2WRGA”) and certain assets of other subsidiaries of the Company relating to those entities’ business of providing commercial, industrial and municipal architectural and construction administration services for projects not involving CEA, with such CEA business being retained by the Company.

~~Prepayments and~~The ~~other~~total ~~assets~~purchase ~~are~~price ~~comprised~~for ofthe ~~prepayments~~transaction ~~paid~~was ~~to vendors to initiate orders~~$2, ~~prepaid services and fees~~000,000 ~~inventories,~~in ~~and other assets~~cash. ~~These amounts are summarized as follows:~~

	June 30,		December 31,
	2025		2024
Vendor Prepayments	$	1,240,987	$	1,355,929
Prepaid Services and Fees		478,565		885,072
Inventories		183,384		222,581
Other current assets		33,283		23,283
Total Prepaid expenses and other assets	$	1,936,219	$	2,486,865

The Purchase Agreement includes customary representations and warranties, covenants, and mutual indemnification provisions between the parties. The agreement also contains non-competition and non-solicitation provisions applicable to the Seller Parties for a specified period following the closing. The Company recorded the disposition in the third quarter of 2025.

~~NOTE~~Subsequent 6to the August 27 Purchase Agreement, 2WR Holdco, LLC acquired –the ~~PROPERTY~~customer ~~AND~~list ~~EQUIPMENT~~of 2WR of Colorado, ~~NET~~Inc. for $143,000 in cash.

~~Property~~In connection with the sales described above, the Company discontinued ~~and~~the ~~equipment~~operations ~~balances~~of ~~are~~the ~~summarized~~remaining asServices ~~follows:~~companies. The table below outlines the gain (loss) on sale or discontinuation of the Services companies.

	June 30,			December 31,
	2025			2024
Computers and technology equipment	$	360,191		$	360,191
Furniture and fixtures		325,485			325,485
Leasehold improvements		228,760			228,760
Vehicles		33,788			417,644
Software		1,259,016			1,151,298
R&D Assets		87,425			-
Other equipment		58,525			145,951
Accumulated depreciation		(1,590,539	)		(1,707,372	)
Total Property and equipment, net	$	762,651		$	921,957

Depreciation expense for the three months ended June 30, 2025, and 2024 totaled $116,087 and $200,708, respectively and totaled $250,870 and $395,972 for the six months June 30, 2025 and 2024 ended respectively.

	2WRGA			2WRCO			2WRMS			UGENG			Total

Carrying amount of assets and liabilities
Cash	$	12,452		$	-		$	-		$	-		$	12,452
Accounts receivable, net		408,368			196,199			20,052			74,099			698,718
Prepaid expenses and other current assets		2,263			2,855			1,356			154,481			160,955
Property and equipment, net		-			10,211			-			60,667			70,878
Operating lease right-of-use assets		54,576			9,876			-			39,991			104,443
Goodwill		-			1,080,638			-			-			1,080,638
Intangible assets, net		52,031			71,799			-			-			123,830
Accounts payable		(483,352	)		-			-			-			(483,352	)
Accrued expenses		(13,536	)		(10,720	)		-			-			(24,256	)
Operating lease liabilities, current		(43,308	)		-			-			-			(43,308	)
Operating lease liabilities, long-term		(3,506	)		-			-			-			(3,506	)
Total carrying amount of assets and liabilities (net deficit)		(14,012	)		1,360,858			21,408			329,238			(1,697,492	)

Gain (loss) on sale or discontinuance of subsidiaries	$	2,014,012		$	(1,239,298	)	$	(21,408	)	$	(329,238	)	$	424,068

10The net gain on sale or discontinuance of subsidiaries is included as a component of discontinued operations, net of tax and reflected in the table below.

~~NOTE~~In 7accordance with the provisions –of ~~GOODWILL~~ASC &205-20, ~~INTANGIBLE~~the ~~ASSETS~~Company has excluded the results of discontinued operations from its results of continuing operations in the accompanying consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024. The results of the discontinued operations for the three and nine months ended September 30, 2025 and 2024 consist of the following:

Goodwill

	Three Months Ended September 30,						Nine Months Ended September 30,
	2025			2024			2025			2024
Revenues
Services	$	724,737		$	1,913,246		$	3,473,213		$	7,404,843
Total revenues		724,737			1,913,246			3,473,213			7,404,843
Cost of revenue
Services		662,515			1,356,925			2,773,820			4,379,087
Total cost of revenue		662,515			1,356,925			2,773,820			4,379,087
Gross profit		62,222			556,321			699,393			3,025,756
Operating expenses:
General and administrative		292,176			786,506			1,454,523			2,443,581
Depreciation and amortization		11,245			79,255			92,450			239,724
Total operating expenses		303,421			865,761			1,546,973			2,683,305

Loss from discontinued operations		(241,199	)		(309,440	)		(847,580	)		342,451

Non-operating income (expense):
Gain on sale or discontinuance of subsidiaries		424,068			-			424,068			-
Total non-operating income (expense)		424,068			-			424,068			-

Income (loss) before income taxes		182,869			(309,440	)		(423,512	)		342,451
Income tax benefit		-			13,685			-			41,055
Net income (loss) from discontinued operations, net of tax	$	182,869		$	(295,755	)	$	(423,512	)	$	383,506

Net income (loss) per share from discontinued operations-basic and diluted	$	0.35		$	(0.60	)	$	(0.81	)	$	0.78
Weighted average common shares outstanding - basic and diluted		529,643			496,937			524,501			489,981

The Company has recorded goodwill in conjunction with the acquisitions it has completed. The goodwill balance as of June 30, 2025 and December 31, 2024 was $1,080,638 for both periods. The Company did not record any impairment charges related to goodwill for the six months ended June 30, 2025 and 2024.10

~~Intangible Assets~~NOTE ~~Other~~5 ~~Than~~– ~~Goodwill~~RELATED PARTY TRANSACTIONS

~~Intangible~~A director of the Company ~~assets~~is asan owner of ~~June~~Cloud 309 Support, ~~2025~~LLC (“Cloud 9”) and ~~December~~Potco ~~31,~~LLC ~~2024~~(“Potco”). ~~consisted~~Cloud 9 purchases materials from the Company for use with its customers and Potco purchases equipment from the Company for use in its cultivation facility. Another director of the ~~following:~~Company is working on a vertical farming innovation model with a group of CEA experts (the “CEA Consortium”). The CEA Consortium contracts services from the Company related to their business model.

	June 30, 2025
	Cost		Accumulated Amortization			Net Book Value
Finite-lived intangible assets:
Trademarks and trade names	$	499,000	$	(400,120	)	$	98,880
Backlog and other		429,400		(429,400	)		-
Licenses		16,437		(16,437	)		-
	$	944,837	$	(845,957	)	$	98,880

There were no material revenues from related party entities for the three and nine months ended September 30, 2025, and 2024.

	December 31, 2024
	Cost		Accumulated Amortization			Net Book Value
Finite-lived intangible assets:
Trademarks and trade names	$	499,000	$	(350,220	)	$	148,780
Backlog and other		429,400		(429,400	)		-
Licenses		16,437		(16,437	)		-
	$	944,837	$	(796,057	)	$	148,780

NOTE 6 – PREPAID EXPENSES AND OTHER ASSETS

~~Amortization expense~~Prepayments ~~for~~and ~~intangible~~ other assets ~~subject~~are tocomprised ~~amortization~~of ~~for~~prepayments ~~the~~paid ~~three~~to ~~months~~vendors ~~ended~~to ~~June 30,~~initiate ~~2025 and 2024 was $24~~orders,~~950 and~~ ~~$194,988, respectively~~prepaid ~~and~~services ~~totaled $49,900~~ and ~~$389~~fees,~~975 for~~ ~~the six months ended June 30~~inventories, ~~2025~~ and ~~2024,~~other ~~respectively~~assets. ~~The~~ These ~~estimated~~amounts ~~future~~are ~~amortization~~summarized ~~expense for intangible assets subject to amortization~~ as ~~of June 30, 2025 is summarized below~~follows:

		Estimated Future
	September 30,			December 31,
		Amortization Expense
	2025			2024
Remainder of 2025		$	49,900
Vendor Prepayments	$	922,877		$	1,355,929
2026			48,980
Prepaid Services and Fees		355,472			877,469
Total		$	98,880
Inventories		177,914			222,581
Other current assets		65,470			23,283
Total Prepaid expenses and other assets	$	1,521,733		$	2,479,262

11The decrease in prepaid expenses includes amounts disposed of in connection with the August 27, 2025 sale of certain subsidiaries. See note 4 – disposition.

NOTE 8 7 – ~~ACCRUED~~PROPERTY ~~EXPENSES~~AND EQUIPMENT, NET

~~Accrued expenses~~Property and equipment balances are summarized as follows:

	June 30,			December 31,
	September 30,			December 31,
	2025			2024
Accrued operating expenses	$	33,156		$	441,031
Computers and technology equipment	$	326,959		$	360,191
Accrued wages and related expenses		545,051			799,969
Furniture and fixtures		209,805			325,485
Business development accrual		47,062			-
Leasehold improvements		133,426			120,255
Accrued interest expense		122,190			68,115
Vehicles		-			417,644
Accrued 401(k)		16,981			17,138
Software		1,259,016			1,151,298
Accrued sales tax payable		3,759,146			2,951,292
R&D Assets		87,425			-
	$	4,523,586		$	4,277,545
Other equipment		34,064			145,951
Accumulated depreciation		(1,484,086	)		(1,707,372	)
Total Property and equipment, net	$	566,609		$	813,452

~~Accrued~~Depreciation expense for the ~~sales~~three ~~tax~~months ~~payable~~ended isSeptember 30, ~~comprised~~2025, ofand ~~amounts~~2024 ~~due~~totaled to$90,337 and ~~various~~$304,049, ~~states~~respectively and ~~Canadian~~totaled ~~provinces~~$324,414 and $929,526 for the ~~2017~~nine ~~through~~months ~~2023~~September 30, 2025 and 2024 ended respectively.

NOTE 9 8 – ~~NOTES~~GOODWILL ~~PAYABLE~~AND INTANGIBLE ASSETS

The Company had recorded goodwill and intangibles in conjunction with ~~table~~the ~~below~~acquisitions ~~shows~~it ~~outstanding~~had ~~notes~~completed. ~~payable~~Goodwill ~~amounts~~was not amortized. The Company did not record any impairment charges related to goodwill for the nine months ended September 30, 2025 and 2024. The Company’s goodwill and intangible assets were fully written off in connection with the August 27, 2025 sale of certain subsidiaries and related assets and discontinuing the operations of the Services segment. As a result, the balances of goodwill and intangible assets were $0 as of ~~June~~September 30, 2025 and December 31, 2024. See Note 4 – Dispositions for further details.

	June 30,			December 31,
	2025			2024
Gemini line of credit	$	1,672,401		$	4,405,402
DVO note		-			135
Grow hill note, net		1,292,552			1,652,071
Agile capital		1,000,114			-
Truist line of credit		197,500			-
Other financing agreements		250,146			706,068
Total		4,412,713			6,763,676
Less current portion		(4,089,203	)		(5,968,145	)
Notes payable, long-term	$	323,510		$	795,531

~~On December~~NOTE ~~13,~~9 ~~2023,~~– UGACCRUED Construction, a wholly owned subsidiary of the Company, entered into an interest only asset based revolving Loan Agreement (the “Line of Credit”) with Gemini Finance Corp. (“Lender”) pursuant to which Lender extended to UG Construction a secured line of credit in an amount not to exceed $10,000,000, to be used to assist UG Construction and the Company with cash management. Lender will consider requests for advances under the Line of Credit, which Lender may accept or reject in its discretion, until September 12, 2024 (the “Initial Term”), subject to an automatic extension for an additional nine-month term until May 12, 2025, provided that UG Construction is in compliance with all the terms of the applicable loan documents and Lender has not sent a written notice of non-renewal at least 60 days prior to expiration of the Initial Term. The Line of Credit contains standard events of default and representations and warranties by UG Construction and the Lender and the Company have entered into a Continuing Guaranty pursuant to which the Company will guarantee repayment of the loans associated with the Line of Credit (the “Guaranty Agreement”).EXPENSES

~~Loans made~~Accrued ~~under~~expenses ~~the~~are ~~Line~~summarized of Credit shall be evidenced by a Secured Promissory Note - Revolving issued by UG Construction to the Lender (the “Promissory Note”), and each draw on the Promissory Note shall be due and payable on or before 180 days after such draw is funded to UG Construction; provided that, such draw is also subject to a mandatory prepayment upon UG Construction’s receipt of payment for any invoice previously submitted and approved for financing by Lender. Lender will receive a security interest in UG Construction’s Collateral (as ~~defined in the “Security Agreement” entered into as part of the Line of Credit). The Promissory Note earns interest at a monthly rate of one and seventy-five hundredths percent (1.75%).~~follows:

	September 30,		December 31,
	2025		2024
Accrued operating expenses	$	166,935	$	441,031
Accrued wages and related expenses		384,327		539,569
Business development accrual		47,062		-
Accrued interest expense		185,562		68,115
Accrued 401(k)		26,148		17,138
Accrued sales tax payable		3,779,950		2,951,292
	$	4,589,984	$	4,017,145

~~In connection~~Accrued ~~with~~sales ~~entering~~tax inpayable is ~~the~~comprised ~~Line~~ of ~~Credit,~~amounts ~~the~~due ~~Company agreed~~ to ~~issue~~various tostates ~~Bancroft Capital, LLC (the “Placement Agent”) cash~~ and ~~warrant~~Canadian ~~compensation~~provinces infor ~~two~~2017 ~~separate~~through ~~tranches, the first being earned upon closing of the Line of Credit and the remainder of which would be due if and when UG Construction draws more than $4,500,000 from the Line of Credit~~2023. ~~Both instances are detailed as follows:~~

1.Certain Ataccrued ~~closing~~liabilities ofwere ~~the~~settled ~~Line~~or oftransferred ~~Credit,~~in ~~the~~connection with ~~Placement Agent earned a cash fee of $200,000. In addition to~~ the ~~cash~~August ~~fee~~27, ~~the~~2025 ~~Company~~sale ~~issued to the Placement Agent or its designees, $200,000 worth~~ of ~~warrants~~certain ~~(the~~subsidiaries “Placement Agent’s Warrants”) to purchase the Company’s common stock at a price per share equal to 110% of the daily volume weighted average closing price of the Company’s common stock on the Nasdaq exchange for a period consisting of ten (10) consecutive trading days ending on and ~~inclusive~~related ~~of the trading day of the Closing~~assets. ~~The~~See ~~Placement~~Note ~~Agent’s~~4 ~~Warrants~~– ~~are~~Dispositions ~~exercisable at any time and from time to time, in whole or in part, during the four and a half-year period commencing six (6) months from the date of issuance. The Placement Agent’s Warrants provide~~ for ~~registration~~further rights (including a one-time demand registration right and unlimited piggyback rights), cashless exercise and customary anti-dilution provisions (for stock dividends and splits) and anti-dilution protection (adjustment in the number and price of such warrants and the shares underlying such warrants) resulting from corporate events (which would include dividends, reorganizations, mergers, etcdetails.).

2.NOTE If and when Emerald draws more than $4,500,000 from the Line of Credit, the Placement Agent will earn an additional cash fee of $200,000, and an additional $200,000 worth of Placement Agent’s Warrants to purchase the Company’s common stock at a price per share equal to 110% of the daily volume weighted average closing price of the Company’s common stock on the Nasdaq exchange for a period consisting of ten (10) ~~consecutive~~– ~~trading~~NOTES ~~days ending on and inclusive of the trading day of the date that the draws exceeding $4,500,000 were to take place.~~PAYABLE

Line of Credit Amendment – On March 18, 2025, UG Construction entered into an agreement with the “Lender”) to amend the terms of the original Loan Agreement and Promissory Note and waiver (the “Amendment”) between UG Construction and the Lender. Pursuant to the Amendment, the Lender waived any potential or perceived events of default arising under certain circumstances, which events did not constitute specified events of default under the Promissory Note or the Loan Agreement. Pursuant to the Amendment, the Promissory Note was amended to provide that (i) the term during which the Lender may consider advances under the Loan Agreement has been extended to January 1, 2026, and (ii) the interest applied on the outstanding principal amount of the Promissory Note will accrue interest at a monthly rate of 1.75%, and all accrued by unpaid interest shall be paid to the Lender on the first business day of each month for the prior month. The ~~Amendment~~table ~~also~~below ~~amended~~shows the Loan Agreement to require monthly reporting of certain accounts receivable and to include a covenant that such accounts receivable equal or exceed 125% of the sum of the total amount drawn down under the Promissory Note, plus outstanding ~~interest,~~notes aspayable ofamounts ~~the applicable measurement date. In connection with the execution of the Amendment, the Company issued to the Lender,~~ as ~~an amendment fee, 150,000 share of the Company’s common stock, par value $0.001 per share, or 6,000 shares after~~ ~~giving effect to a 1-for-25 reverse stock split (the “Fee Shares”)~~ of ~~the~~September ~~Company’s common stock~~30, ~~par~~2025 ~~value~~and ~~$0.001 per~~December ~~share. This resulted in an expense of $109~~31,~~424,~~ ~~which is included in interest expense on the condensed consolidated statement of operations~~2024.

	September 30,			December 31,
	2025			2024
Gemini line of credit	$	1,400,687		$	4,405,402
DVO note		-			135
Grow hill note, net		1,331,003			1,652,071
Agile capital		652,324			-
J Brrothers		374,512			-
Other financing agreements		56,036			706,068
Total		3,814,562			6,763,676
Less current portion		(3,814,562	)		(5,968,145	)
Notes payable, long-term	$	-		$	795,531

~~On October~~Revolving 1,Line ~~2024,~~of ~~the Company, entered into a loan~~ Credit with ~~Grow~~Gemini ~~Hill,~~Finance ~~LLC, a Washington limited liability company (“Grow Hill”)~~Corp. ~~The terms are as follows:~~

1.On December 13, 2023, UG Construction, a wholly owned subsidiary of the Company, entered into an interest only asset based revolving Loan ~~Details~~Agreement (the “Line of Credit”) with Gemini Finance Corp. (“Lender”) pursuant to which Lender extended to UG Construction a secured line of credit in an amount not to exceed $10,000,000, to be used to assist UG Construction and the Company with cash management. Lender will consider requests for advances under the Line of Credit, which Lender may accept or reject in its discretion, until September 12, 2024 (the “Initial Term”), subject to an automatic extension for an additional nine-month term until May 12, 2025, provided that UG Construction is in compliance with all the terms of the applicable loan documents and Lender has not sent a written notice of non-renewal at least 60 days prior to expiration of the Initial Term. The Line of Credit contains standard events of default and representations and warranties by UG Construction and the Lender and the Company have entered into a Continuing Guaranty pursuant to which the Company will guarantee repayment of the loans associated with the Line of Credit (the “Guaranty Agreement”).

~~● Principal Amount: $2,000,000.~~12

●Loans ~~Interest~~made ~~Rate:~~under ~~15%~~the ~~per~~Line of ~~annum~~Credit shall be evidenced by a Secured Promissory Note - Revolving issued by UG Construction to the Lender (the “Promissory Note”), and ~~applied~~each draw on the Promissory Note shall be due and payable on or before 180 days after such draw is funded to UG Construction; provided that, such draw is also subject to a mandatory prepayment upon UG Construction’s receipt of payment for any invoice previously submitted and approved for financing by Lender. Lender will receive a security interest in UG Construction’s Collateral (as defined in the “Security ~~outstanding~~Agreement” ~~principal~~entered ~~amount~~into as part of the Line of Credit). The Promissory Note earns interest at a monthly rate of one and seventy-five hundredth percent (1.75%).

●In ~~Origination~~connection ~~Fee:~~with ~~$100,000~~entering in ~~(5%~~the Line of Credit, the ~~loan~~Company ~~amount~~agreed to issue to Bancroft Capital, LLC (the “Placement Agent”) cash and warrant compensation in two separate tranches, ~~considered~~the asfirst ~~debt~~being ~~issuance~~earned ~~costs~~upon ~~under~~closing ~~GAAP~~of the Line of Credit and ~~amortized~~the ~~over~~remainder of which would be due if and when UG Construction draws more than $4,500,000 from the ~~loan~~Line ~~term~~of Credit. Both instances are detailed as follows:

●1. ~~Repayment~~At ~~Terms:~~closing ~~Monthly~~of ~~payments~~the Line of ~~interest~~Credit, ~~and~~the ~~principal~~Placement asAgent earned a cash fee of $200,000. In addition to the cash fee, the Company issued to the Placement Agent or its designees, $200,000 worth of warrants (the “Placement Agent’s Warrants”) to purchase the Company’s common stock at a price per share equal to 110% of the ~~Promissory~~daily ~~Note~~volume weighted average closing price of the Company’s common stock on the Nasdaq exchange for a period consisting of ten (10) consecutive trading days ending on and inclusive of the trading day of the Closing. ~~Ther~~The ~~term~~Placement Agent’s Warrants are exercisable at any time and from time to time, in whole or in part, during the four and a half-year period commencing six (6) months from the date of issuance. The Placement Agent’s Warrants provide for registration rights (including a one-time demand registration right and unlimited piggyback rights), cashless exercise and customary anti-dilution provisions (for stock dividends and splits) and anti-dilution protection (adjustment in the ~~loan~~number isand 2price ~~years~~of such warrants and the shares underlying such warrants) resulting from corporate events (which would include dividends, reorganizations, mergers, etc.).

●2. ~~Optional~~If ~~Prepayment:~~and ~~Allowed~~when ifEmerald draws more than $4,500,000 from the ~~Grow~~Line ~~Hill~~of ~~has~~Credit, ~~received~~the Placement Agent will earn an additional cash fee of $~~150~~200,000, orand ~~more~~an inadditional ~~interest~~$200,000 ~~payments.~~worth Ifof ~~less,~~Placement Agent’s Warrants to purchase the Company’s ~~must~~common ~~pay~~stock ~~the~~at ~~difference~~a price per share equal to ~~reach~~110% ~~$150,000.~~of ~~Prepayment~~the ~~requires~~daily atvolume ~~least~~weighted ~~one~~average ~~Business~~closing ~~Day~~price of the Company’s ~~notice~~common stock on the Nasdaq exchange for a period consisting of ten (10) consecutive trading days ending on and inclusive of the trading day of the date that the draws exceeding $4,500,000 were to take place.

●Line of ~~Mandatory~~Credit ~~Prepayment:~~Amendment ~~Required~~– ifOn March 18, 2025, UG Construction entered into an agreement with the ~~Company~~“Lender”) ~~fails~~to amend the terms of the original Loan Agreement and Promissory Note and waiver (the “Amendment”) between UG Construction and the Lender. Pursuant to ~~meet~~the Amendment, the ~~Receivable~~Lender ~~Ratio~~waived ~~negative~~any ~~covenants~~potential or perceived events of default arising under certain circumstances, which events did not constitute specified events of default under the Promissory Note or the Loan Agreement. Pursuant to the Amendment, the Promissory Note was amended to provide that (i) the term during which the Lender may consider advances under the Loan Agreement has been extended to January 1, 2026, and (ii) the interest applied on the outstanding principal amount of the Promissory Note will accrue interest at a monthly rate of 1.75%, and all accrued by unpaid interest shall be paid to the Lender on the first business day of each month for the prior month. The Amendment also amended the Loan Agreement to require monthly reporting of certain accounts receivable and to include a covenant that such accounts receivable equal or exceed 125% of the sum of the total amount drawn down under the Promissory Note, plus outstanding interest, as of the applicable measurement date. In connection with the execution of the Amendment, the Company issued to the Lender, as an amendment fee, 150,000 share of the Company’s common stock, par value $0.001 per share, or 6,000 shares after giving effect to a 1-for-25 reverse stock split (the “Fee Shares”) of the Company’s common stock, par value $0.001 per share. This resulted in an expense of $109,424, which is included in interest expense on the condensed consolidated statement of operations.

~~2. Collateral and Security~~13

●Loan ~~Collateral:~~Agreement ~~Defined~~with inGrow Hill, ~~the Security Agreement.~~LLC

●On ~~Security~~October ~~Agreement:~~1, ~~The~~2024, the Company, entered ~~grants~~into a ~~perfected~~loan ~~security~~with ~~interest~~Grow inHill, ~~the~~LLC, ~~Collateral~~a toWashington ~~the~~limited liability company (“Grow Hill”). The terms are as follows:

~~3. The loan became effective on October~~ 1~~, 2024, when the Company issued Warrants to the Grow Hill for 160,000 shares of Borrower’s common stock at $2~~.~~50/share,~~ orLoan ~~6,400 shares after giving effect to a 1-for-25 reverse stock split, exercisable immediately and valid for five years.~~Details

4.● ~~Covenants~~Principal Amount: $2,000,000.

● ~~Affirmative~~Interest ~~Covenants~~Rate: 15% per annum, applied to the outstanding principal amount.

▪● ~~Provide~~Origination ~~regular~~Fee: ~~financial reports~~$100,000 ~~compliance~~(5% ~~certificates~~of the loan amount), ~~and~~considered ~~notices~~as ofdebt ~~defaults~~issuance orcosts ~~legal~~under ~~actions~~GAAP and amortized over the loan term.

▪● ~~Comply~~Repayment ~~with~~Terms: ~~all~~Monthly ~~applicable~~payments ~~laws~~of interest and ~~regulations,~~principal ~~including~~as ~~tax~~per ~~payments~~the Promissory Note. Ther term of the loan is 2 years.

▪● ~~Cooperate~~Optional ~~with~~Prepayment: ~~audits~~Allowed ofif ~~accounts~~the ~~receivable~~Grow (Hill has received $150,000 or more in interest payments. If less, the Company ~~pays~~must ~~audit~~pay ~~fees~~the ~~unless~~difference anto ~~Event~~reach of$150,000. ~~Default~~Prepayment ~~occurs)~~requires at least one Business Day’s notice.

● ~~Negative~~Mandatory ~~Covenants~~Prepayment: Required if the Company fails to meet the Receivable Ratio negative covenants or events of default.

▪2. ~~Restrictions~~Collateral onand ~~creating liens, incurring additional debt, or guaranteeing third-party obligations without Grow Hill’s consent.~~Security

▪● ~~Maintain~~Collateral: aDefined ~~Receivable~~in ~~Ratio~~the ofSecurity ~~at least 2~~Agreement.~~00:1.00, calculated monthly.~~

5.● ~~Events~~Security ofAgreement: ~~Default~~The Company grants a perfected security interest in the Collateral to the Grow Hill.

●3. ~~Include~~The ~~failure~~loan became effective on October 1, 2024, when the Company issued Warrants to ~~pay~~the ~~principal~~Grow orHill ~~interest~~for 160,000 ~~breach~~shares of ~~covenants,~~Borrower’s ~~misrepresentation,~~common ~~insolvency~~stock at $2.50/share, or ~~legal~~6400 ~~challenges~~shares after giving effect to ~~the~~a ~~validity~~1-for-25 ofreverse ~~the~~stock ~~Loan~~split, ~~Documents~~exercisable immediately and valid for five years.

●4. ~~Consequences~~Covenants: ~~Grow Hill may accelerate repayment, enforce security interests, or exercise other remedies.~~

14● Affirmative Covenants:

~~Business Loan~~○ Provide regular financial reports, compliance certificates, and ~~Security~~notices ~~Agreement~~of ~~with~~defaults ~~Agile~~or ~~Entities~~legal actions.

~~On June~~○ ~~26,~~Comply ~~2025, the Company entered into a business loan and security agreement (the “Loan Agreement”)~~ with anall ~~effective~~applicable ~~date of~~laws ~~June 24, 2025(the “Effective Date”) by~~ and ~~among~~regulations, ~~Agile~~including ~~Capital~~tax ~~Funding, LLC, Agile Lending , LLC, a Virginia limited liability company and each assignee that becomes a party pursuant to Section 12~~payments.1 of the Loan Agreement (the “Lenders”), the Company and 2WR Of Colorado Inc., UG Construction, Inc., 2WR of Georgia, Inc., urban-gro Canada Technologies Inc., urban-gro Engineering, Inc. and urban-gro Architect Holdings, LLC, each a wholly owned subsidiary of the Company (individually, collectively, jointly and severally, the “Guarantors”).

~~Pursuant to~~○ ~~the~~Cooperate ~~Loan~~with ~~Agreement,~~audits ~~the Lenders extended to the Company a term loan~~ of ~~$1,050,000~~accounts receivable (the ~~“Term Loan”) to be used to fund the~~ Company’s ~~general~~pays ~~business~~audit ~~requirements.~~fees ~~The~~unless ~~Loan Agreement is for a term of twenty-eight weeks from the Effective Date (the “Maturity Date”) and includes~~ an ~~administrative~~Event ~~agent fee~~ of ~~$50,000~~Default to be remitted to Agile Capital Funding, LLC which was added to the amount of the loan. The Company may make a full prepayment or partial prepayment of the Term Loan, however, upon the prepayment of any principal amount, the Company shall be obligated to pay a premium payment of such principal so paid, which shall be equal to the aggregate and actual amount of interest that would be paid through the Maturity Date (the “Prepayment Fee”occurs); provided however that, if the Company made a prepayment within 60 calendar days after the Effective Date, the Company would receive the discounted Prepayment Fee that is included in Exhibit E to the Loan Agreement.

~~The Loan~~● ~~contains~~Negative standard events of default and representations and warranties by the Company and the Lenders including a mandatory prepayment, and an additional five (5%) percent interest rate following the occurrence of an event of default. The term loan is evidenced by a secured promissory note issued by the Company to the Lenders (the “Promissory Note”). Pursuant to the Loan Agreement, upon an event of default, the Lenders will receive a security interest in certain of the Company’s assets, subject to certain exceptions.Covenants:

~~Truist Line~~○ ofRestrictions ~~Credit~~on creating liens, incurring additional debt, or guaranteeing third-party obligations without Grow Hill’s consent.

~~2WR of~~○ ~~Georgia,~~Maintain ~~Inc. (“2WR GA”),~~ a ~~subsidiary~~Receivable ofRatio ~~the Company, maintained a line~~ of ~~credit~~at ~~with~~least ~~Truist Bank (the “Truist Line of Credit”) that was established prior to the Company’s acquisition of the architectural firm on July 30~~2.00:1.00, ~~2021~~calculated monthly.

~~In May~~5. ~~2025,~~Events ~~the Company became aware~~ of the Truist line of credit and subsequently borrowed $197,500 under the facility. The proceeds were deposited into a Truist Bank account and subsequently transferred to another Company account for general corporate purposes.Default

~~As of~~● ~~June~~Include ~~30,~~failure ~~2025,~~to ~~the~~pay ~~outstanding~~principal ~~balance~~or ~~under~~interest, ~~the~~breach ~~Truist line~~ of ~~credit~~covenants, ~~was~~misrepresentation, ~~$197~~insolvency,~~500,~~ ~~which~~or ~~was~~legal ~~classified~~challenges asto ~~current~~the ~~debt~~validity of the Loan Documents.

~~In the~~● ~~third~~Consequences: ~~quarter~~Grow ofHill ~~2025,~~may inaccelerate ~~connection~~repayment, ~~with~~enforce ~~the~~security ~~sale of 2WR GA to CM Capital for $2.0 million~~interests, ~~the~~or ~~Truist~~exercise ~~line~~other ~~of credit was repaid in full using a portion of the transaction proceeds~~remedies.

~~Other~~ 14

~~The other~~Business ~~financing~~Loan ~~agreements relate to short-term financing of the Company’s insurance policies~~ and ~~are~~Security Agreement atwith anAgile ~~average interest rate of 13.6%.~~Entities

~~NOTE~~On 10June 26, 2025, the Company –entered ~~COMMITMENTS~~into ~~AND~~a ~~CONTINGENCIES~~business loan and security agreement (the “Loan Agreement”) with an effective date of June 24, 2025(the “Effective Date”) by and among, Agile Capital Funding, LLC, Agile Lending , LLC, a Virginia limited liability company and each assignee that becomes a party pursuant to Section 12.1 of the Loan Agreement (the “Lenders”), the Company and 2WR Of Colorado Inc., UG Construction, Inc., 2WR of Georgia, Inc., urban-gro Canada Technologies Inc., urban-gro Engineering, Inc. and urban-gro Architect Holdings, LLC, each a wholly owned subsidiary of the Company (individually, collectively, jointly and severally, the “Guarantors”).

~~From~~Pursuant to the Loan Agreement, ~~time~~the Lenders extended to ~~time~~the Company a term loan of $1,050,000 (the “Term Loan”) to be used to fund the Company’s general business requirements. The Loan Agreement is ~~involved~~for ina ~~routine~~term ~~litigation~~of ~~that~~twenty-eight ~~arises~~weeks infrom the ~~ordinary~~Effective ~~course~~Date (the “Maturity Date”) and includes an administrative agent fee of ~~business~~$50,000 to be remitted to Agile Capital Funding, LLC which was added to the amount of the loan. ~~Other~~The ~~than~~Company ~~below~~may make a full prepayment or partial prepayment of the Term Loan, ~~there~~however, ~~are~~upon the prepayment of any principal amount, nothe ~~other~~Company ~~legal~~shall ~~proceedings~~be ~~for~~obligated to pay a premium payment of such principal so paid, which ~~management~~shall ~~believes~~be equal to the ~~ultimate~~aggregate ~~outcome~~and actual amount of interest that would ~~have~~be paid through the Maturity Date (the “Prepayment Fee”); provided however that, if the Company made a ~~material~~prepayment ~~adverse~~within ~~effect~~60 oncalendar days after the Effective Date, the Company’s would receive the discounted Prepayment Fee that is included ~~results~~in ofExhibit ~~operations~~E ~~and~~to ~~cash~~the ~~flows~~Loan Agreement.

~~Gemini~~The Loan contains standard events of default and representations and warranties by the Company and the Lenders including a mandatory prepayment, and an additional five (5%) percent interest rate following the occurrence of an event of default. The term loan is evidenced by a secured promissory note issued by the Company to the Lenders (the “Promissory Note”). Pursuant to the Loan Agreement, ~~Amendment~~upon ~~and~~an ~~Default~~event of default, the Lenders will receive a security interest in certain of the Company’s assets, subject to certain exceptions.

~~On December~~Truist ~~13,~~Line 2023, our wholly-owned subsidiary UG Construction, Inc. d/b/a Emerald Construction Management, Inc. (“UG Construction”) entered into (i) an interest only asset based revolving loan agreement (the “Loan Agreement”) with Gemini Finance Corp. (“Gemini”) pursuant to which Gemini extended to UG Construction a secured line of credit in an amount not to exceed $10,000,000, to be used to assist UG Construction and us with cash management, and (ii) a Secured Promissory Note - Revolving issued by UG Construction to Gemini (the “Promissory Note”). Pursuant to the Promissory Note, each draw was due and payable on or before 180 days after such draw is funded to UG Construction, subject to a mandatory pre-payment upon UG Construction’s receipt of payment for any invoice previously submitted and approved for financing by Gemini.Credit

152WR of Georgia, Inc. (“2WR GA”), a subsidiary of the Company, maintained a line of credit with Truist Bank (the “Truist Line of Credit”) that was established prior to the Company’s acquisition of the architectural firm on July 30, 2021.

~~On March~~In ~~18,~~May 2025, UGthe ~~Construction~~Company ~~entered~~became aware ~~into~~of ~~an amendment to~~ the ~~Loan~~Truist ~~Agreement~~line ~~and~~of ~~Promissory~~credit ~~Note~~ and ~~waiver~~subsequently ~~with~~borrowed ~~Gemini~~$197,500 (under the ~~“Amendment”)~~facility. ~~Pursuant~~ toThe ~~the~~proceeds ~~Amendment,~~were ~~Gemini~~deposited ~~waived~~into ~~any~~a ~~potential~~Truist ~~or perceived events of default arising under certain circumstances, which events~~Bank ~~did~~account ~~not~~and ~~constitute~~subsequently ~~specified~~transferred ~~events~~to ofanother ~~default~~Company ~~under~~account ~~the~~for ~~Promissory~~general ~~Note~~corporate ~~or the Loan Agreement~~purposes.

~~Pursuant to~~In the ~~Amendment,~~third ~~the~~quarter ~~Promissory~~of ~~Note was amended to provide that (i) the term during which Gemini may consider advances under the Loan~~2025, ~~Agreement~~in ~~has~~connection ~~been~~with ~~extended to January 1, 2026, and (ii)~~ the ~~interest~~sale ~~applied on the outstanding principal amount~~ of ~~the~~2WR ~~Promissory~~GA ~~Note will accrue interest at an annual rate of 12%, and all accrued and unpaid interest shall be paid~~ to ~~Gemini~~CM onCapital ~~the first business day of each month~~ for ~~the prior month~~$2.0 ~~The~~million, ~~Amendment also amended~~ the ~~Loan~~Truist ~~Agreement~~line ~~to require monthly reporting~~ of ~~certain~~credit ~~accounts~~was ~~receivable and~~repaid toin ~~include~~full using a ~~covenant~~portion ~~that such accounts receivable equal or exceed 125%~~ of ~~the sum of the total amount drawn down under the Promissory~~ ~~Note, plus outstanding interest, as of~~ the ~~applicable~~transaction ~~measurement date~~proceeds. ~~In connection with the execution of the Amendment, we issued to Gemini, as an amendment fee, 150,000 shares of our common stock, or 6,000 shares after giving effect to a 1-for-25 reverse stock split.~~

~~On July~~Settlement ~~31,~~Agreement ~~2025, Gemini issued a notice of default to UG Construction claiming that UG Construction was in default under the line of credit due to a failure to submit receivables calculations~~ and ~~failing to maintain sufficient eligible accounts and to forward accounts~~ ~~receivable.~~Promissory ~~The~~Note ~~notice indicated that the remaining outstanding amount due under the line of credit of approximately $1.76 million was immediately due and payable~~ with ~~default of~~J 1%Brrothers ~~per week accruing from the June 16, 2025 date of default claimed by Gemini, and that Gemini intended to pursue legal action if full payment was not received by August 8, 2025.~~LLC

On August 218, 2025, wethe Company ~~received~~entered into a ~~notification~~Settlement ~~from~~and ~~Gemini~~Release ~~stating~~Agreement ~~that~~(the ~~Gemini~~“Settlement ~~would~~Agreement”) ~~proceed~~ with aJ ~~foreclosure~~Brrothers LLC (“J Brrothers”) and ~~private~~Herb-a-More ~~sale~~LLC ofrelating ~~substantially~~to a dispute arising from amounts due for certain heating, ventilation and air ~~all~~conditioning ofequipment. Pursuant to the ~~assets~~terms of UGthe ~~Construction~~Settlement inAgreement, among other things, the Company issued a promissory note to J Brrothers with an ~~Article~~original 9principal ~~sale~~amount ~~process~~of $395,556 ~~pursuant~~(the to“Note”) ~~Section~~and ~~9601~~agreed etto ~~seq.~~issue 150,000 unregistered shares of the ~~California~~Company’s ~~Commercial~~common ~~Code~~stock, or 6,000 shares after giving effect to a 1-for-25 reverse stock split, to J Brrothers (the “~~Asset Sale~~Shares”). The ~~Asset~~Note ~~Sale~~will ~~occurred~~accrue onsimple ~~September~~interest 4,at ~~2025~~an annual rate of 12% and has a maturity date of March 18, at2026. The ~~which~~Note ~~Gemini~~will ~~acquired~~be ~~the~~repaid ~~assets~~in ~~constituting~~monthly installments over a period of eight months, with the ~~collateral~~first seven payments being $50,000 per month ~~under~~and the ~~line~~final ofmonthly ~~credit~~payment ~~for~~being $~~450~~64,~~000~~047. Any remaining principal and accrued but unpaid interest will become due and payable on the maturity date, and the Note may be prepaid without penalty. The Note includes customary representations and warranties, customary events of default and a 17% default interest rate.

~~On August~~The ~~29,~~Company ~~2025,~~is ~~Gemini~~currently ~~commenced~~ in a ~~lawsuit~~payment ~~captioned Gemini~~default ~~Finance~~under ~~Corp. v. UG Construction, Inc. et al., case number 25CV2259 W SBC, in~~ the ~~U.S.~~terms ~~District Court for the Southern District~~ of ~~California, which lawsuit (~~the ~~“Lawsuit”) included us and certain of our officers as defendants and pursuant to which Gemini claimed it was owed $1,486,189 (the “Claim Amount”)~~Note.

~~On September~~Other 26, 2025, we entered into a Settlement and Mutual General Release (the “Gemini Settlement Agreement”) with Gemini. Pursuant to the terms of the Gemini Settlement Agreement, among other things, we agreed to file a joint motion requesting an expedited fairness hearing under Section 3(a)(10) of the Securities Act of 1933, as amended (the “Securities Act”), which motion was filed on September 30, 2025. Following such fairness hearing, and subject to the satisfaction of all applicable conditions and requirements of Section 3(a)(10) of the Securities Act, we agreed to issue to Gemini shares of our common stock that, upon sale by Gemini, would result in net proceeds to Gemini equal to the Claim Amount, provided that Gemini shall at no time be issued shares if it would beneficially own more than 4.99% of our common stock, and the aggregate number of shares issued to Gemini may not exceed 19.99% of our outstanding common stock as of immediately prior to the signing of the Gemini Settlement Agreement to the extent required by Nasdaq Listing Rule 5635. Additionally, Gemini agreed to use its best efforts to not sell common stock exceeding 10% of our daily volume on any given trading day. Upon the issuance of the last tranche of shares under the Gemini Settlement Agreement, Gemini will dismiss the Lawsuit with prejudice. The Gemini Settlement Agreement also included a customary mutual release of claims by the parties. The fairness hearing occurred on October 14, 2025.

~~Grow Hill~~The ~~Default~~other financing agreements have interest rates ranging from 8.9% to 11.0%.

On October 1, 2024, we entered into an asset-based term Loan Agreement with Grow Hill, LLC (“Grow Hill”) pursuant to which Grow Hill extended to us a secured loan of $2,100,000 with an origination fee of $100,000, which was added to the amount of the loan. The loan is evidenced by a Secured Promissory Note issued by us to Grow Hill. Grow Hill received a security interest in certain of our assets pursuant to a security agreement between us and Grow Hill (the “Security Agreement”), which does not include any assets of our subsidiaries.15

16NOTE 11 – COMMITMENTS AND CONTINGENCIES

~~On October~~From ~~14,~~time ~~2025~~to time, wethe ~~received~~Company is ~~service~~involved ofin ~~process~~routine ~~for~~litigation athat ~~lawsuit~~arises ~~filed by Grow Hill against us~~ in the ~~District~~ordinary ~~Court~~course ~~for the City and County~~ of ~~Denver, Colorado (Case No~~business. ~~2025CV33546)~~Other ~~alleging~~than ~~breach of contract and fraud. Pursuant the complaint~~below, ~~Grow~~there ~~Hill~~are ~~stated~~no ~~that~~other welegal ~~were~~proceedings infor ~~default~~which ~~under~~management believes the ~~Secured~~ultimate ~~Promissory~~outcome ~~Note~~would ~~due~~have to a ~~failure~~material toadverse ~~timely~~effect ~~make~~on ~~payments, and elected to accelerate all amounts due under~~ the ~~Secured~~Company’s ~~Promissory~~results ~~Note, including a default fee equal to 1%~~ of ~~the~~operations ~~outstanding principal amount. We are currently investigating~~and ~~available~~cash ~~options to resolve the complaint and intends to vigorously defend the allegation of fraud~~flows.

JGemini ~~Brrothers Settlement~~Loan Agreement Amendment and Default

On ~~August~~ 8December 13, ~~2025~~2023, weour wholly-owned ~~entered~~subsidiary ~~into~~UG Construction, Inc. d/b/a ~~Settlement~~Emerald ~~and~~Construction ~~Release~~Management, ~~Agreement~~Inc. (~~the~~ “~~Settlement~~UG ~~Agreement~~Construction”) ~~with~~entered ~~J Brrothers LLC (“J~~into ~~Brrothers”~~(i) ~~and~~an ~~Herb-a-More~~interest ~~LLC~~only ~~relating~~asset tobased arevolving ~~dispute~~loan ~~arising~~agreement ~~from~~(the ~~amounts~~“Loan ~~due~~Agreement”) ~~for~~with ~~certain~~Gemini ~~heating,~~Finance ~~ventilation~~Corp. ~~and air conditioning~~(“Gemini”) ~~equipment.~~pursuant ~~Pursuant~~ to ~~the~~which ~~terms~~Gemini ofextended ~~the~~to ~~Settlement~~UG ~~Agreement,~~Construction ~~among other things, we issued~~ a ~~promissory~~secured ~~note~~line toof Jcredit ~~Brrothers~~in ~~with~~ an ~~original~~ ~~principal~~ amount ofnot ~~$395,556~~to ~~and~~exceed ~~issued 150~~$10,000 ~~unregistered shares of our common stock~~, ~~or 6,~~000, ~~shares after giving effect~~ to abe ~~1-for-25~~used ~~reverse stock split~~ to Jassist UG ~~Brrothers.~~Construction ~~The~~and ~~note~~us ~~accrues~~with ~~simple~~cash ~~interest~~management, ~~at an annual rate of 12%~~ and ~~has~~(ii) a ~~maturity~~Secured ~~date~~Promissory ~~of March~~Note ~~18,~~- ~~2026.~~Revolving ~~The~~issued ~~note~~by ~~must~~UG beConstruction ~~repaid~~to inGemini ~~monthly~~(the ~~installments~~“Promissory Note”). ~~over~~Pursuant ato ~~period~~the ofPromissory ~~eight months~~Note, ~~with~~each ~~the~~draw ~~first~~was ~~seven~~due ~~payments being $50,000 per month~~ and ~~the~~payable ~~final~~on ~~monthly~~or ~~payment~~before ~~being~~180 ~~$64,047.~~days ~~Any~~after ~~remaining~~such ~~principal~~draw ~~and~~is ~~accrued~~funded ~~but~~to ~~unpaid~~UG ~~interest will become due and payable~~Construction, onsubject ~~the~~to ~~maturity~~a ~~date,~~mandatory ~~and~~pre-payment ~~the~~upon ~~note~~UG ~~may~~Construction’s bereceipt ~~prepaid~~of ~~without~~payment ~~penalty.~~for ~~The~~any ~~note~~invoice ~~includes~~previously ~~customary~~submitted ~~representations~~ and ~~warranties,~~approved ~~customary~~for ~~events~~financing ofby ~~default and a 17% default interest rate~~Gemini.

~~2WR~~On March 18, 2025, UG Construction entered into an amendment to the Loan Agreement and Promissory Note and waiver with Gemini (the “Amendment”). Pursuant to the Amendment, Gemini waived any potential or perceived events of ~~Georgia~~default ~~Sale~~arising under certain circumstances, which events did not constitute specified events of default under the Promissory Note or the Loan Agreement.

~~On August~~Pursuant ~~27,~~to ~~2025~~the Amendment, the ~~certain~~Promissory ofNote ~~our~~was ~~subsidiaries~~amended ~~entered~~to ~~into~~provide athat ~~Stock~~(i) ~~and~~the ~~Asset~~term ~~Purchase~~during ~~Agreement~~which ~~(the~~Gemini ~~“2WR~~may ~~Purchase~~consider advances under the Loan Agreement”) has been ~~with~~extended ~~2WR~~to ~~Holdco~~January 1, ~~LLC~~2026, ~~(the~~and ~~“Buyer”~~(ii). ~~Pursuant to~~ the ~~2WR~~interest ~~Purchase~~applied ~~Agreement,~~on the ~~Buyer~~outstanding ~~acquired~~principal ~~all~~amount of the ~~outstanding~~Promissory ~~shares~~Note will accrue interest ofat ~~stock~~an ofannual ~~2WR~~rate of ~~Georgia~~12%, ~~Inc.~~ and ~~certain~~all ~~assets~~accrued ofand ~~our~~unpaid ~~other~~interest ~~subsidiaries~~shall ~~relating~~be paid to ~~those~~Gemini ~~entities’~~on the first business day of ~~providing~~each month for the ~~commercial,~~prior ~~industrial~~month. ~~and~~The ~~municipal~~Amendment ~~architectural~~also ~~and~~amended ~~construction~~the ~~administration~~Loan ~~services~~Agreement ~~for~~to ~~projects~~require ~~not~~monthly ~~involving~~reporting ~~CEA.~~of ~~The~~certain ~~purchase~~accounts receivable and to include ~~price~~a ~~paid~~covenant bythat such accounts receivable equal or exceed 125% of the ~~Buyer~~sum ~~consisted~~of the total amount drawn down under the Promissory Note, plus outstanding interest, as of $2the applicable measurement date.0 ~~million~~In inconnection ~~cash~~with the execution of the Amendment, ~~offset~~we byissued ato ~~previous~~Gemini, ~~deposit~~as an amendment fee, 150,000 shares of ~~$500~~our common stock, or 6,000 ~~and~~shares byafter ~~any~~giving ~~assumed~~effect ~~indebtedness~~to a 1-for-25 reverse stock split.

~~MJ’s~~On July 31, 2025, Gemini issued ~~Market~~a notice of default to UG Construction claiming that UG Construction was in default under the line of credit due to a failure to submit receivables calculations and failing to maintain sufficient eligible accounts and to forward accounts receivable. The notice indicated that the remaining outstanding amount due under the line of credit of approximately $1.76 million was immediately due and payable with default of 1% per week accruing from the June 16, ~~Inc~~2025 date of default claimed by Gemini, and that Gemini intended to pursue legal action if full payment was not received by August 8, 2025.

~~MJ’s Market,~~On ~~Inc.~~August ~~v. Urban-Gro~~21, ~~Inc. et al~~2025, ~~pending~~we inreceived a ~~the~~notification ~~Suffolk~~from ~~County~~Gemini ~~Superior~~stating ~~Court~~that inGemini ~~Massachusetts~~would asproceed ~~Civil~~with ~~Action~~a ~~No.~~foreclosure ~~2384-cv-02794. The~~and ~~original~~private ~~complaint,~~sale ~~filed~~of bysubstantially ~~MJ’s~~all ~~Market,~~of ~~Inc, alleged that~~ the ~~Corporation~~assets ~~prepared~~of UG ~~deign~~Construction ~~drawings~~in ~~for~~an ~~the~~Article ~~plaintiff~~9 ~~and~~sale ~~subsequently sold~~process, ~~those~~pursuant ~~drawings~~ to aSection ~~competitor.~~9601 ~~The~~et ~~original complaint asserted claims for Breach of Contract; violation of M~~seq.~~G.L.~~ ~~c. 93A; Breach~~ of the ~~Covenant~~California ofCommercial ~~Good~~Code ~~Faith and Fair Dealing; Trademark Infringement; and Interference with Contractual Relations against~~ (the ~~Corporation~~“Asset Sale”). AnThe ~~amended~~Asset ~~complaint~~Sale ~~has~~occurred ~~been~~on ~~filed~~September ~~which names 2WR of Colorado~~4, ~~Inc.~~2025, at which isGemini ~~characterized~~acquired asthe aassets ~~subsidiary~~constituting orthe ~~affiliate~~collateral ofunder the ~~Corporation, in~~line ~~place~~ of ~~the~~credit for ~~Corporation~~$450,000. ~~The lawsuit is ongoing.~~

RKOn August 29, 2025, Gemini ~~Mechanical-~~commenced ~~complaint~~a ~~filed~~lawsuit captioned Gemini Finance Corp. v. UG Construction, Inc. et al., case number 25CV2259 W SBC, in the U.S. District Court for the Southern District of California, which lawsuit (the “Lawsuit”) included us and certain of our officers as defendants and pursuant to which Gemini claimed it was owed $1,486,189 (the “Claim Amount”).

On ~~June~~ 27September 26, 2025, RKwe entered ~~Mechanical~~into ~~LLC~~a Settlement and Mutual General Release (the “RKGemini Settlement Agreement”) ~~filed~~with aGemini. ~~complaint~~Pursuant ~~against~~to UGthe ~~Construction~~terms of ~~and~~the ~~certain~~Gemini Settlement Agreement, among other ~~defendants~~things, ~~with~~we ~~SVC Manufacturing~~agreed ~~Inc.~~to asfile ~~cross-claimant~~a ~~and~~joint UGmotion ~~Construction~~requesting asan ~~cross-defendant,~~expedited infairness ~~the~~hearing ~~Superior~~under Section ~~Court~~3(a)(10) of ~~Arizona~~the ~~for~~Securities ~~Maricopa~~Act ~~County~~of 1933, as amended (~~Case No.~~the ~~CV2025-022680~~“Securities Act”)., ~~The~~which ~~complaint~~motion ~~alleged~~was ~~that~~filed UGon ~~Construction~~September ~~served~~30, 2025. asFollowing ~~general~~such ~~contractor~~fairness ~~for~~hearing, and subject to the ~~construction~~satisfaction of ~~the~~all ~~construction~~ applicable conditions and requirements of Section 3(a)(10) of ~~PepsiCo~~the ~~plant~~Securities ~~in Tolleson~~Act, ~~Arizona,~~we ~~and~~agreed ~~that~~to asissue ato ~~result~~Gemini shares of ~~work~~our ~~completed~~common bystock RKthat, UGupon ~~Construction~~sale ~~owed~~by $1Gemini,~~522,716~~ towould RKresult asin anet ~~result~~proceeds ofto ~~alleged~~Gemini ~~breach~~equal to the Claim Amount, provided that Gemini shall at no time be issued shares if it would beneficially own more than 4.99% of ~~contract~~our common stock, ~~breach~~and the aggregate number of ~~implied~~shares ~~covenant~~issued to Gemini may not exceed 19.99% of ~~good~~our ~~faith~~outstanding ~~and~~common ~~fair~~stock ~~dealing,~~as ~~violation~~of immediately prior to the signing of the ~~Arizona~~Gemini ~~Prompt~~Settlement ~~Payment~~Agreement ~~Act~~to the extent required by Nasdaq Listing Rule 5635. Additionally, Gemini agreed ~~and~~to ~~lien~~use ~~foreclosure.~~its Onbest orefforts ~~about~~to ~~October~~not ~~2025,~~sell acommon ~~default~~stock ~~judgment~~exceeding ~~was~~10% ~~entered~~of ~~against~~our UGdaily ~~Construction~~volume ~~for~~on ~~$1,511,716,~~any ~~plus~~given ~~prejudgment~~trading day. Upon the issuance of the ~~interest~~last tranche of ~~$288~~shares under the Gemini Settlement Agreement,~~346~~ ~~and~~Gemini ~~post-judgment~~will ~~interest~~dismiss atthe 8Lawsuit with prejudice.~~25%~~ ~~plus~~The ~~$10,057~~Gemini inSettlement ~~attorney~~Agreement also ~~fees~~included a customary mutual release of claims by the parties. The fairness hearing occurred on October 14, 2025.

~~Action Equipment- complaint filed~~16

~~On April~~Grow ~~21,~~Hill ~~2025,~~Default Action Equip. & Scaffold Co. (“Action”) filed a complaint against UG Construction in the Superior Court of Arizona for Maricopa County (Case No. CV2025-014165). The complaint alleged that UG Construction owed Action $380,932 plus interest and attorneys’ fees in connection with a contract pursuant to which Action leased equipment to UG Construction, and alleged breach of contract, breach of covenant of good faith and fair dealing, and unjust enrichment. A default judgment was

17On October 1, 2024, we entered into an asset-based term Loan Agreement with Grow Hill, LLC (“Grow Hill”) pursuant to which Grow Hill extended to us a secured loan of $2,100,000 with an origination fee of $100,000, which was added to the amount of the loan. The loan is evidenced by a Secured Promissory Note issued by us to Grow Hill. Grow Hill received a security interest in certain of our assets pursuant to a security agreement between us and Grow Hill (the “Security Agreement”), which does not include any assets of our subsidiaries.

~~NOTE~~On 11October 14, 2025, we received –service ~~RISKS~~of ~~AND~~process ~~UNCERTAINTIES~~for a lawsuit filed by Grow Hill against us in the District Court for the City and County of Denver, Colorado (Case No. 2025CV33546) alleging breach of contract and fraud. Pursuant the complaint, Grow Hill stated that we were in default under the Secured Promissory Note due to a failure to timely make payments, and elected to accelerate all amounts due under the Secured Promissory Note, including a default fee equal to 1% of the outstanding principal amount. We are currently investigating available options to resolve the complaint and intends to vigorously defend the allegation of fraud.

~~Concentration Risk~~J Brrothers Settlement

~~The~~On August 8, 2025, we entered ~~table~~into ~~below~~a ~~shows~~Settlement ~~customers~~and ~~who~~Release ~~account~~Agreement (the “Settlement Agreement”) with J Brrothers LLC (“J Brrothers”) and Herb-a-More LLC relating to a dispute arising from amounts due for ~~10%~~certain orheating, ~~more~~ventilation and air conditioning equipment. Pursuant to the terms of the ~~Company’s~~Settlement ~~total~~Agreement, ~~revenues~~among other things, we issued a promissory note to J Brrothers with an original principal amount of $395,556 and ~~10%~~agreed to issued 150,000 unregistered shares of our common stock, or ~~more~~6,000 shares after giving effect to a 1-for-25 reverse stock split to J Brrothers. The note accrues simple interest at an annual rate of 12% and has a maturity date of March 18, 2026. The note must be repaid in monthly installments over a period of eight months, with the ~~Company’s~~first seven payments being $50,000 per month and the final ~~accounts~~monthly ~~receivable~~payment ~~for~~being $64,047. Any remaining principal and accrued but unpaid interest will become due and payable on the ~~periods~~maturity ~~presented:~~date, and the note may be prepaid without penalty. The note includes customary representations and warranties, customary events of default and a 17% default interest rate.

~~Customers exceeding~~MJ’s ~~10%~~Market, ~~of revenue~~Inc

	Three Months Ended						Six Months Ended
	June 30,						June 30,
Company Customer Number	2025			2024			2025			2024
C000002187		*			*			*			24	%
C000002552		10	%		65	%		11	%		36	%
C000001462		*			*			12	%		*
C000002607		*			*			13	%		*
C000002722		10	%		*			25	%		*

MJ’s Market, Inc. v. Urban-Gro, Inc. et al, pending in the Suffolk County Superior Court in Massachusetts as Civil Action No. 2384-cv-02794. The original complaint, filed by MJ’s Market, Inc, alleged that the Corporation prepared deign drawings for the plaintiff and subsequently sold those drawings to a competitor. The original complaint asserted claims for Breach of Contract; violation of M.G.L. c. 93A; Breach of the Covenant of Good Faith and Fair Dealing; Trademark Infringement; and Interference with Contractual Relations against the Corporation. An amended complaint has been filed which names 2WR of Colorado, Inc., which is characterized as a subsidiary or affiliate of the Corporation, in place of the Corporation. The lawsuit is ongoing.

*RK ~~Amounts~~Mechanical ~~less~~- ~~than~~complaint ~~10%~~filed

~~Customers~~On June 27, 2025, RK Mechanical ~~exceeding~~LLC ~~10%~~(“RK”) filed a complaint against UG Construction and certain other defendants, with SVC Manufacturing Inc. as cross-claimant and UG Construction as cross-defendant, in the Superior Court of ~~accounts~~Arizona ~~receivable~~for Maricopa County (Case No. CV2025-022680). The complaint alleged that UG Construction served as general contractor for the construction of the construction of a PepsiCo plant in Tolleson, Arizona, and that as a result of work completed by RK, UG Construction owed $1,522,716 to RK as a result of alleged breach of contract, breach of implied covenant of good faith and fair dealing, violation of the Arizona Prompt Payment Act, and lien foreclosure. On or about October 2025, a default judgment was entered against UG Construction for $1,511,716, plus prejudgment interest of $288,346 and post-judgment interest at 8.25% plus $10,057 in attorney fees.

	June 30,			December 31,
Company Customer Number	2025			2024
C000002187		*			14	%
C000002463		56	%		*
C000002722		34	%		*
C000002607		20	%		*
C000002596		18	%		*
C000002195		13	%		*
C000001999		10	%		*

*Action ~~Amounts~~Equipment ~~less~~- ~~than~~complaint ~~10%~~filed

~~The~~On April 21, 2025, Action ~~table~~Equip. ~~below~~& ~~shows~~Scaffold ~~vendors~~Co. ~~who~~(“Action”) ~~account~~filed ~~for~~a ~~10%~~complaint oragainst ~~more~~UG ofConstruction in the ~~Company’s~~Superior ~~total~~Court ~~purchases~~of Arizona for Maricopa County (Case No. CV2025-014165). The complaint alleged that UG Construction owed Action $380,932 plus interest and ~~10%~~attorneys’ orfees in ~~more~~connection with a contract pursuant to which Action leased equipment to UG Construction, and alleged breach of ~~the~~contract, ~~Company’s~~breach ~~accounts~~of ~~payable~~covenant ~~for~~of ~~the~~good ~~periods~~faith ~~presented:~~and fair dealing, and unjust enrichment.

~~Vendors exceeding~~NOTE ~~10%~~12 of– ~~purchases~~RISKS AND UNCERTAINTIES

	Three Months Ended						Six Months Ended
	June 30,						June 30,
Company Vendor Number	2025			2024			2025			2024
V000002275		*			*			*			*
V000002198		*			15	%		*			16	%
V000002503		*			23	%		*			25	%
V000001029		17	%		*			18	%		*
V000001153		11	%		*			10	%		*

Concentration Risk

*The ~~Amounts~~table ~~less~~below ~~than~~shows customers who account for 10% or more of the Company’s total revenues and 10% or more of the Company’s accounts receivable for the periods presented:

18Customers exceeding 10% of revenue

Vendors exceeding 10% of accounts payable

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
Company Customer Number	2025			2024			2025			2024
C000001462		*			40	%		*			11	%
C000002187		19	%		13	%		*			22	%
C000002607		*			13	%		*			*
C000002552		26	%		*			12	%		24	%
C000001462		*			*			10	%		*
C000002607		38	%		*			18	%		*
C000002722		*			*			21	%		*
C000002655		15	%		*

	June 30,	December 31,
Company Vendor Number	2025	2024
V000002275	*	*

*	Amounts less than 10%

*Customers ~~Amounts~~exceeding ~~less than~~ 10% of accounts receivable

Foreign Exchange Risk

Company Customer Number	September 30, 2025			December 31, 2024
C000002187		*			14	%
C000002596		33	%		*
C000002571		17	%		*
C000001575		15	%		*
C000002532		15	%		*

~~Although our~~* ~~revenues~~Amounts ~~and~~less ~~expenses~~than are expected to be predominantly denominated in United States dollars, we may be exposed to currency exchange fluctuations. Recent events in the global financial markets have been coupled with increased volatility in the currency markets. Fluctuations in the exchange rate between the U.S. dollar, the Canadian dollar, the Euro, and the currency of other regions in which we may operate may have a material adverse effect on our business, financial condition and operating results. We may, in the future, establish a program to hedge a portion of our foreign currency exposure with the objective of minimizing the impact of adverse foreign currency exchange movements. However, even if we develop a hedging program, it may not mitigate currency risks.10%

~~NOTE 12 – STOCK-BASED COMPENSATION~~18

~~Based on~~The ~~the~~table ~~vesting~~below ~~schedule~~shows ofvendors who ~~the~~account ~~grants~~for of10% ~~restricted stock units (“RSU”~~ or ~~“RSUs”)~~more ~~and~~of ~~options, stock-based compensation expense for~~ the ~~three~~Company’s ~~months~~total ~~ended~~purchases ~~June 30, 2025~~ and ~~2024~~10% ~~totaled~~or ~~$210,193 and~~more ~~$460,785,~~of ~~respectively,~~the ~~and~~Company’s ~~totaled~~accounts ~~$534,464 and $1,117,361~~ payable for the ~~six months ended June 30, 2025, and 2024, respectively.~~periods presented:

~~The Company~~Vendors ~~has~~exceeding adopted the 2021 Omnibus Stock Incentive Plan, as amended (the “Omnibus Incentive Plan”), which provides for the issuance of incentive stock options, grants of RSUs, and stock-based awards to employees, directors, and consultants of the Company to reward and attract employees and compensate the Company’s Board of Directors (the “Board”) and vendors when applicable. The Omnibus Incentive Plan is administered by the Company’s Board. Grants of RSUs under the Omnibus Incentive Plan are valued at no less than the market price of the stock on the date of grant. The fair value of the options is calculated using the Black-Scholes pricing model based on the estimated market value of the underlying common stock at the valuation measurement date, the remaining contractual term of the options, risk-free interest rate and expected volatility of the price of the underlying common stock of 10010%. ~~There is a moderate degree~~ of subjectivity involved when estimating the value of stock options with the Black-Scholes option pricing model as the assumptions used are moderately judgmental. Grant of RSUs and stock options are sometimes offered as part of an employment offer package, to ensure continuity of service or as a reward for performance. Grants of RSUs and stock options typically require a 1 to 3 year period of continued employment or service performance before the grant of RSUs or stock options vest. No cash flow effects are anticipated for grants of RSUs or stock options.purchases

As of June 30, 2025, total unrecognized compensation expense was $840,350 of which $839,212 was attributable to unvested RSUs and $1,138 was attributable to unvested stock options.

	Three Months Ended September 30,						Nine Months Ended September 30,
Company Vendor Number	2025			2024			2025			2024
V000002198		*			14	%		*			11	%
V000002503		*			51	%		*			40	%
V000001029		*			*			15	%		*
V000001372		17	%		*			*			*
V000002786		13	%		*			*			*

~~NOTE~~* ~~13 –~~Amounts ~~STOCKHOLDERS’~~less ~~EQUITY~~than 10%

~~Common Stock~~Vendors exceeding 10% of accounts payable

The Company is authorized to issue 200,000,000 shares of common stock at $0.001 par value. The holders of the Company’s common stock are entitled to one vote for each share held.

Company Vendor Number			September 30, 2025				December 31, 2024
V000002503			*				*

~~Preferred stock~~* Amounts less than 10%

~~The Company~~Foreign isExchange authorized to issue 3,000,000 shares of preferred stock with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s Board of Directors. The preferred stock has a par value of $0.10.Risk

~~Treasury~~Although our revenues and ~~Stock~~expenses are expected to be predominantly denominated in United States dollars, we may be exposed to currency exchange fluctuations. Recent events in the global financial markets have been coupled with increased volatility in the currency markets. Fluctuations in the exchange rate between the U.S. dollar, the Canadian dollar, the Euro, and the currency of other regions in which we may operate may have a material adverse effect on our business, financial condition and operating results. We may, in the future, establish a program to hedge a portion of our foreign currency exposure with the objective of minimizing the impact of adverse foreign currency exchange movements. However, even if we develop a hedging program, it may not mitigate currency risks.

AsNOTE of13 ~~June~~– ~~30, 2025 and December 31, 2024, there were 57,993 shares of treasury stock outstanding, after giving effect to the 1~~STOCK-~~for-25 reverse~~BASED ~~stock split that was effective on February 9, 2026.~~COMPENSATION

19Based on the vesting schedule of the grants of restricted stock units (“RSU” or “RSUs”) and options, stock-based compensation expense for the three months ended September 30, 2025 and 2024 totaled $170,022 and $343,884, respectively, and totaled $704,486 and $1,461,245 for the nine months ended September 30, 2025, and 2024, respectively.

~~NOTE~~The 14Company has adopted the –2021 ~~SEGMENTS~~Omnibus Stock Incentive Plan, as amended (the “Omnibus Incentive Plan”), which provides for the issuance of incentive stock options, grants of RSUs, and stock-based awards to employees, directors, and consultants of the Company to reward and attract employees and compensate the Company’s Board of Directors (the “Board”) and vendors when applicable. The Omnibus Incentive Plan is administered by the Company’s Board. Grants of RSUs under the Omnibus Incentive Plan are valued at no less than the market price of the stock on the date of grant. The fair value of the options is calculated using the Black-Scholes pricing model based on the estimated market value of the underlying common stock at the valuation measurement date, the remaining contractual term of the options, risk-free interest rate and expected volatility of the price of the underlying common stock of 100%. There is a moderate degree of subjectivity involved when estimating the value of stock options with the Black-Scholes option pricing model as the assumptions used are moderately judgmental. Grant of RSUs and stock options are sometimes offered as part of an employment offer package, to ensure continuity of service or as a reward for performance. Grants of RSUs and stock options typically require a 1 to 3 year period of continued employment or service performance before the grant of RSUs or stock options vest. No cash flow effects are anticipated for grants of RSUs or stock options.

~~An operating~~As ~~segment is defined as a component~~ of aSeptember ~~reporting~~30, ~~entity~~2025, ~~that~~total ~~engages~~unrecognized incompensation ~~business~~expense ~~activities from which it recognizes revenues~~was ~~and~~$670,328 ~~incurs expenses with discrete financial information available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”)~~ of ~~the~~which ~~operating~~$669,190 ~~segment.~~was ~~The~~attributable ~~CODM utilizes this financial information~~ to ~~decide~~unvested ~~how~~RSUs ~~to allocate resources to,~~ and ~~in assessing performance of~~$1,138 ~~the~~was ~~operating~~attributable ~~segment.~~to ~~Management~~unvested ~~evaluates~~stock ~~segment performance primarily based on operating segment gross profit~~options.

~~The Company has identified the following operating segments related as of June 30, 2025 and 2024:~~19

●NOTE ~~Equipment~~14 ~~systems~~– -STOCKHOLDERS’ Operating segment that acts as an experienced vendor providing value-added reselling to clients when selling vetted best-in-call commercial horticulture lighting solutions, rolling and automated container benching systems, specialty fans, fertigation/irrigation systems, environmental control systems, and microbial mitigation and odor reduction systems.EQUITY

●Common Services - Operating segment that generates revenue by providing clients with design-build service offerings that include architectural, interior, and engineering design, construction management, as well as services for the operational stages of the facility. The Company’s in-house architectural, interior design, engineering, construction and cultivation design services integrate design with pre-construction services and thereby reduce project schedule and capital investments.Stock

●The ~~Construction~~Company ~~design-build~~is -authorized to ~~Operating~~issue 200,000,000 shares ~~segment~~of ~~that~~common ~~engages~~stock asat a$0.001 par ~~general~~value. ~~contractor~~The toholders ~~provide~~of ~~all~~ the ~~additional necessary parts to deliver clients~~Company’s ~~projects,~~common ~~from~~stock ~~the~~are ~~initial estimate and bid process,~~ entitled to one vote ~~subcontractor~~for ~~selection,~~each ~~and~~share ~~management of all construction details~~held.

~~In addition~~Preferred to the operating segments identified above, the Company recognizes other revenues and incurs costs at the corporate level where it develops and oversees the implementation of company-wide strategic initiatives and provides support to our operating segments by centralizing certain administrative functions. Corporate management is responsible for, among other things: evaluating and selecting the geographic markets in which we operate, consistent with our overall business strategy; making major personnel decisions related to employee compensation and benefits; and monitoring the financial and operational performance of the Company’s operating segments. Corporate costs include general and administrative expenses related to operating our corporate headquarters.stock

The Company’s ~~operating~~is ~~segments follow the same accounting policies used for our consolidated financial statements as described in~~authorized ~~Note~~to 1issue –3,000,000 ~~Summary~~shares of ~~Significant~~preferred ~~Accounting~~stock ~~Policies.~~with ~~The~~such ~~results~~designations, ofvoting ~~each~~and ~~operating~~other ~~segment~~rights ~~are~~and ~~not~~preferences ~~necessarily~~as ~~indicative~~may ofbe ~~the~~determined from ~~results~~time ~~that~~to ~~would~~time ~~have~~by ~~occurred had~~ the ~~operating~~Company’s ~~segment~~Board ~~been~~of anDirectors. ~~independent,~~The ~~stand-alone~~preferred ~~entity~~stock ~~during~~has ~~the~~a ~~periods~~par ~~presented,~~value ~~nor are they indicative~~ of ~~the results to be expected in future periods~~$0.10.

20Treasury Stock

~~The~~As ~~following~~of ~~tables~~September ~~present~~30, ~~financial~~2025 ~~information~~and ~~relating~~December to31, ~~our~~2024, ~~operating~~there ~~segments~~were ~~for~~57,993 ~~the~~shares ~~period~~of ~~ended~~treasury ~~June 30~~stock outstanding, ~~2025~~after giving ~~and~~effect ~~2024:~~to the 1-for-25 reverse stock split that was effective on February 9, 2026.

	Three months ended June 30, 2025
	Equipment			Services			Construction			Corporate/other			Total
Revenues	$	3,128,746		$	1,099,378		$	3,512,650		$	25,328			7,766,102
Cost of revenues		2,995,183			1,060,162			3,646,334			19,680			7,721,359
Gross profit	$	133,563		$	39,216		$	(133,684	)	$	5,648		$	44,743
Gross profit %		4	%		4	%		-4	%		22	%		1	%
Intangible asset amortization	$	-		$	24,950		$	-		$	-		$	-
Income (Loss) before income taxes	$	(1,657,337	)	$	(653,270	)	$	(3,876,031	)	$	(17,506	)	$	(6,204,144	)
Total assets	$	3,759,153		$	2,557,623		$	3,569,552		$	33,413		$	9,919,741

NOTE 15 – SEGMENTS

	Six months ended June 30, 2025
	Equipment			Services			Construction			Corporate/other			Total
Revenues	$	7,827,323		$	2,748,476		$	6,634,948		$	69,430			17,280,177
Cost of revenues		7,339,790			2,111,308			7,120,721			53,593			16,625,412
Gross profit	$	487,533		$	637,168		$	(485,773	)	$	15,837		$	654,765
Gross profit %		6	%		23	%		-7	%		23	%		4	%
Intangible asset amortization	$	-		$	49,900		$	-		$	-		$	49,900
Income (Loss) before income taxes	$	(4,415,569	)	$	(480,552	)	$	(5,210,808	)	$	(45,735	)	$	(10,252,664	)
Total assets	$	3,759,153		$	2,557,623		$	3,569,552		$	33,413		$	9,919,741

An operating segment is defined as a component of a reporting entity that engages in business activities from which it recognizes revenues and incurs expenses with discrete financial information available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”) of the operating segment. The CODM utilizes this financial information to decide how to allocate resources to, and in assessing performance of, the operating segment. Management evaluates segment performance primarily based on operating segment gross profit.

	Three months ended June 30, 2024
	Equipment			Services			Construction			Corporate/other			Total
Revenues	$	3,398,696		$	2,357,806		$	12,059,096		$	129,651			17,945,249
Cost of revenues		2,753,497			1,513,715			11,181,017			86,704			15,534,933
Gross profit	$	645,199		$	844,091		$	878,079		$	42,947		$	2,410,316
Gross profit %		19	%		36	%		7	%		33	%		13	%
Intangible asset amortization	$	-		$	194,988		$	-		$	-		$	-
Income (Loss) before income taxes	$	(570,661	)	$	(395,889	)	$	(2,024,792	)	$	(21,769	)	$	(3,013,111	)
Total assets	$	9,739,724		$	9,058,862		$	35,866,793		$	342,180		$	55,007,559

The Company has identified the following operating segments related as of September 30, 2025 and 2024:

	Six months ended June 30, 2024
	Equipment			Services			Construction			Corporate/other			Total
Revenues	$	5,904,345		$	5,491,598		$	21,742,909		$	207,434			33,346,286
Cost of revenues		4,923,608			3,022,163			19,856,346			142,393			27,944,510
Gross profit	$	980,737		$	2,469,435		$	1,886,563		$	65,041		$	5,401,776
Gross profit %		17	%		45	%		9	%		31	%		16	%
Intangible asset amortization	$	-		$	389,975		$	-		$	-		$	-
Income (Loss) before income taxes	$	(995,450	)	$	(925,862	)	$	(3,665,771	)	$	(34,973	)	$	(5,622,056	)
Total assets	$	9,739,724		$	9,058,862		$	35,866,793		$	342,180		$	55,007,559

●

Equipment systems - Operating segment that acts as an experienced vendor providing value-added reselling to clients when selling vetted best-in-call commercial horticulture lighting solutions, rolling and automated container benching systems, specialty fans, fertigation/irrigation systems, environmental control systems, and microbial mitigation and odor reduction systems.

21● Construction design-build - Operating segment that engages as a general contractor to provide all the additional necessary parts to deliver clients’ projects, from the initial estimate and bid process, to subcontractor selection, and management of all construction details.

~~NOTE~~In 15addition to the operating –segments ~~SUBSEQUENT~~identified ~~EVENTS~~above, the Company recognizes other revenues and incurs costs at the corporate level where it develops and oversees the implementation of company-wide strategic initiatives and provides support to our operating segments by centralizing certain administrative functions. Corporate management is responsible for, among other things: evaluating and selecting the geographic markets in which we operate, consistent with our overall business strategy; making major personnel decisions related to employee compensation and benefits; and monitoring the financial and operational performance of the Company’s operating segments. Corporate costs include general and administrative expenses related to operating our corporate headquarters.

~~Nasdaq~~The Company’s operating ~~Deficiencies~~segments follow the same accounting policies used for our consolidated financial statements as described in Note 1 – Summary of Significant Accounting Policies. The results of each operating segment are not necessarily indicative of the results that would have occurred had the operating segment been an independent, stand-alone entity during the periods presented, nor are they indicative of the results to be expected in future periods.

~~The Company has received the following communications from The Nasdaq Stock Market LLC (“Nasdaq”) and, where required, responded as indicated:~~20

● August 18, 2025 – Nasdaq sent the Company a determination letter (the “August 18 Determination”) stating that Nasdaq had determined that the Company did not file the Form 10-K and the March 31 Form 10-Q by August 15, 2025, the date required for the delinquent filings by an exception previously received from Nasdaq staff. The ~~August~~following 18tables ~~Determination~~present financial ~~stated~~information ~~that,~~relating as a result, unless that Company timely requests an appeal, the trading of the Company’s common stock (the “Common Stock”) would be suspended at the opening of business on August 27, 2025 and (iii) a Form 25-NSE will be filed with the SEC, which would remove the Company’s securities from listing and registration on Nasdaq. The August 18 Determination also stated that the Company was not in compliance (i) with Listing Rule 5250(c)(1) due to ~~the~~our ~~Company’s~~operating ~~delay~~segments ~~in filing its Quarterly Report on Form 10-Q~~ for the period ended ~~June~~ September 30, 2025, and (ii) with Listing Rule 5550(b)(1), which requires the Company to maintain minimum stockholders’ equity of $2.5 million. As previously reported, on February 24, 2025, Nasdaq notified the Company that it was not in compliance with Listing Rule 5550(b)(1) due to having stockholders’ equity of less than $2.5 million. The Determination informed the Company that it may appeal the decision to a Hearings Panel (the “Panel”). If the Company chose to appeal, the request must be received by Nasdaq no later than 42024:00 p.m. Eastern Time on August 25, 2025. The Company requested a hearing before the Panel and a preliminary date of October 7, 2025 was set for the hearing. On October 7, 2025, the Company announced that the hearing was postponed to October 14, 2025. This request stayed the suspension of the Company’s Common Stock for a period of 15 days from the date of the request. In connection with this request, the Company also requested a stay of the suspension pending the hearing (the “Additional Stay”).

● August 28, 2025 – Nasdaq sent the Company a determination letter (the “August 28 Determination”) stating that Nasdaq had determined that the Company did not regain compliance with the Minimum Bid Requirement by August 25, 2025. The August 28 Determination stated that the failure to comply with the Minimum Bid Requirement during the compliance period would serve as an additional basis for delisting the Company’s securities from the Nasdaq Capital Market and would be considered by a Hearings Panel (the “Panel”), in addition to the Company’s failure to comply with (i) Nasdaq Listing Rule 5250(c)(1) due to the Company’s delay in filing its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and its Quarterly Reports on Form 10-Q for the periods ended March 31, June 30, 2025 (the “Timely Filing Requirement”), and (ii) Nasdaq Listing Rule 5550(b)(1), which requires the Company to maintain minimum stockholders’ equity of $2.5 million (the “Stockholders’ Equity Requirement”).

	Three months ended September 30, 2025
	Equipment			Construction			Corporate/other			Total
Revenues	$	866,173		$	1,408,556		$	108,765			2,383,494
Cost of revenues		777,784			1,684,747			92,714			2,555,245
Gross profit	$	88,389		$	(276,191	)	$	16,051		$	(171,751	)
Gross profit %		10	%		-20	%		15	%		-7	%

Intangible asset amortization	$	-		$	-		$	-		$	-

Loss before income taxes	$	(1,825,281	)	$	(2,968,242	)	$	(229,200	)	$	(5,022,723	)

Total assets	$	1,478,311		$	1,657,899		$	33,271		$	3,169,481

● October 14, 2025 – The Company presented to the Panel.

	Nine months ended September 30, 2025
	Equipment			Construction			Corporate/other			Total
Revenues	$	8,693,496		$	8,043,505		$	178,195			16,915,196
Cost of revenues		8,127,289			8,795,757			146,306			17,069,352
Gross profit	$	566,207		$	(752,252	)	$	31,889		$	(154,156	)
Gross profit %		7	%		-9	%		18	%		-1	%

Intangible asset amortization	$	-		$	-		$	-		$	-

Loss before income taxes	$	(6,841,923	)	$	(7,673,097	)	$	(153,986	)	$	(14,669,006	)

Total assets	$	1,478,311		$	1,657,899		$	33,271		$	3,169,481

● October 30, 2025 – Nasdaq sent the Company a notice notifying the Company that the Panel had determined to grant the Company’s request to continue its listing on The Nasdaq Capital Market, subject to certain conditions. Specifically, the Panel conditioned the Company’s continued listing on the Company regaining compliance with the Timely Filing Requirement and the Stockholders’ Equity Requirement on or before December 31, 2025 and regaining compliance with the Bid Price Rule on or before January 28, 2026. During the exception period, the Company is required to provide prompt notification to the Panel of any significant event that may affect the Company’s compliance with Nasdaq requirements. Any documentation evidencing the Company’s compliance will be subject to review by the Panel, which may, in its discretion, request additional information before determining whether the Company has regained compliance.

	Three months ended September 30, 2024
	Equipment			Construction			Corporate/other			Total
Revenues	$	3,720,174		$	4,172,110		$	83,727			7,976,011
Cost of revenues		3,290,624			3,932,699			57,935			7,281,258
Gross profit	$	429,550		$	239,411		$	25,792		$	694,753
Gross profit %		12	%		6	%		31	%		9	%

Intangible asset amortization	$	-		$	-		$	-		$	-

Loss before income taxes	$	(1,614,772	)	$	(1,810,939	)	$	(36,342	)	$	(3,462,053	)

Total assets	$	13,217,281		$	35,588,919		$	399,849		$	49,206,049

● November 18, 2025 – Nasdaq sent the Company a notice (the “November 18 Notice”) stating that because the Company had not yet filed its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025 (the “September 30 Form 10-Q”) or its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the “Form 10-K”), the Company continues to be out of compliance with Nasdaq Listing Rule 5250(c)(1). Nasdaq Listing Rule 5250(c)(1) requires listed companies to timely file all required periodic financial reports with the Securities and Exchange Commission.

	Nine months ended September 30, 2024
	Equipment			Construction			Corporate/other			Total
Revenues	$	9,624,514		$	25,915,018		$	291,161			35,830,693
Cost of revenues		8,214,233			23,789,045			200,328			32,203,606
Gross profit	$	1,410,281		$	2,125,973		$	90,833		$	3,627,087
Gross profit %		15	%		8	%		31	%		10	%

Intangible asset amortization	$	-		$	-		$	-		$	-

Loss before income taxes	$	(2,615,196	)	$	(7,041,690	)	$	(79,115	)	$	(9,736,001	)

Total assets	$	13,217,281		$	35,588,919		$	399,849		$	49,206,049

2221

	●	On January 6, 2026, the Company received a determination letter (the “January 6, 2026 Determination”) from Nasdaq stating that because the Company did not hold an annual meeting of stockholders within twelve months from the Company’s prior fiscal year end as required by Nasdaq Listing Rule 5620(a), the resulting non-compliance would be an additional basis for delisting the Company’s securities. The January 6, 2026 Determination notified the Company that the Panel would consider the matter in their decision regarding the Company’s continued listing on the Nasdaq Capital Market, and requested that the Company present its views with respect to the additional deficiency in writing by January 9, 2026. The Company intends to make a submission to the Panel by the requested date, and has requested an additional extension to comply with the Bid Price Rule, the Stockholders’ Equity Requirement and the Timely Filing Requirement.
	●	On January 13, 2026, the Panel notified the Company that it had granted a further extension to regain compliance with the Stockholders’ Equity Requirement, the Annual Meeting Requirement and the Timely Filing Requirement on or before February 17, 2026 and with the Bid Price Rule on or before February 24, 2026.

NOTE 16 – SUBSEQUENT EVENTS

~~Settlement with~~Nasdaq ~~Vendor~~Deficiencies

~~On August~~The ~~8, 2025, the~~ Company ~~entered~~has ~~into~~received ~~a Settlement and Release Agreement (~~the ~~“Settlement Agreement”) with J Brrothers~~ ~~LLC~~following ~~(“J~~communications ~~Brrothers”) and Herb-a-More LLC relating to a dispute arising~~ from ~~amounts~~The ~~due~~Nasdaq ~~for~~Stock ~~certain~~Market ~~heating,~~LLC ventilation and air conditioning equipment. Pursuant to the terms of the Settlement Agreement, among other things, the Company issued a promissory note to J Brrothers with an original principal amount of $395,556 (~~the~~ “~~Note~~Nasdaq”) and ~~issued 150~~,~~000~~ ~~unregistered~~where ~~shares of the Company’s common stock~~required, orresponded ~~6,000~~as shares after giving effect to a 1-for-25 reverse stock split, to J Brrothers (the “Shares”). The Note will accrue simple interest at an annual rate of 12% and has a maturity date of March 18, 2026. The Note will be repaid in monthly installments over a period of eight months, with the first seven payments being $50,000 per month and the final monthly payment being $64,047. Any remaining principal and accrued but unpaid interest will become due and payable on the maturity date, and the Note may be prepaid without penalty. The Note includes customary representations and warranties, customary events of default and a 17% default interest rate. indicated:

● August 18, 2025 – Nasdaq sent the Company a determination letter (the “August 18 Determination”) stating that Nasdaq had determined that the Company did not file the Form 10-K and the March 31 Form 10-Q by August 15, 2025, the date required for the delinquent filings by an exception previously received from Nasdaq staff. The August 18 Determination stated that, as a result, unless that Company istimely ~~currently~~requests an appeal, the trading of the Company’s common stock (the “Common Stock”) would be suspended at the opening of business on August 27, 2025 and (iii) a Form 25-NSE will be filed with the SEC, which would remove the Company’s securities from listing and registration on Nasdaq. The August 18 Determination also stated that the Company was not in compliance (i) with Listing Rule 5250(c)(1) due to the Company’s delay in filing its Quarterly Report on Form 10-Q for the period ended June 30, 2025, and (ii) with Listing Rule 5550(b)(1), which requires the Company to maintain minimum stockholders’ equity of $2.5 million. As previously reported, on February 24, 2025, Nasdaq notified the Company that it was not in compliance with Listing Rule 5550(b)(1) due to having stockholders’ equity of less than $2.5 million. The Determination informed the Company that it may appeal the decision to a ~~payment~~Hearings ~~default~~Panel ~~under~~(the “Panel”). If the ~~terms~~Company chose to appeal, the request must be received by Nasdaq no later than 4:00 p.m. Eastern Time on August 25, 2025. The Company requested a hearing before the Panel and a preliminary date of October 7, 2025 was set for the ~~Note~~hearing. On October 7, 2025, the Company announced that the hearing was postponed to October 14, 2025. This request stayed the suspension of the Company’s Common Stock for a period of 15 days from the date of the request. In connection with this request, the Company also requested a stay of the suspension pending the hearing (the “Additional Stay”).

~~Services~~ ● August 28, 2025 – ~~Sale~~Nasdaq ofsent ~~2WR~~the ~~Georgia~~Company a determination letter (the “August 28 Determination”) stating that Nasdaq had determined that the Company did not regain compliance with the Minimum Bid Requirement by August 25, ~~Inc~~2025.; ~~Sale~~The August 28 Determination stated that the failure to comply with the Minimum Bid Requirement during the compliance period would serve as an additional basis for delisting the Company’s securities from the Nasdaq Capital Market and would be considered by a Hearings Panel (the “Panel”), in addition to the Company’s failure to comply with (i) Nasdaq Listing Rule 5250(c)(1) due to the Company’s delay in filing its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and its Quarterly Reports on Form 10-Q for the periods ended March 31, June 30, 2025 (the “Timely Filing Requirement”), and (ii) Nasdaq Listing Rule 5550(b)(1), which requires the Company to maintain minimum stockholders’ equity of ~~Customer~~$2.5 ~~Lists:~~million ~~Remaining~~(the ~~Services~~“Stockholders’ Equity Requirement”).

~~On August~~● 27October 14, 2025, ~~the~~– ~~Company~~The ~~announced that certain subsidiaries (the “Seller Parties”) of the~~ Company ~~entered~~presented ~~into a Stock and Asset Purchase Agreement (the “August 27 Purchase Agreement”) with 2WR Holdco, LLC (the “Buyer”). Pursuant~~ to the ~~August 27 Purchase Agreement, the Buyer acquired (the “Acquisition”) all of the outstanding shares of stock of 2WR of Georgia, Inc~~Panel. (“2WRGA”) and certain assets of other subsidiaries of the Company relating to those entities’ business of providing commercial, industrial and municipal architectural and construction administration services for projects not involving CEA, with such CEA business being retained by the Company.

~~The purchase~~● ~~price~~October ~~paid~~30, by2025 ~~the~~– ~~Buyer~~Nasdaq ~~for~~sent the ~~Acquisition~~Company ~~consisted~~a ofnotice ~~$2.0~~notifying ~~million~~the inCompany ~~cash~~that ~~and~~the byPanel ~~any~~had ~~assumed~~determined ~~indebtedness.~~to ~~The~~grant ~~August~~the ~~27 Purchase~~Company’s ~~Agreement~~request ~~includes non-competition and non-solicitation restrictions applicable~~ to ~~the~~continue ~~Seller~~its ~~Parties~~listing ~~and~~on ~~customary~~The ~~representations and~~Nasdaq ~~warranties~~Capital ~~and~~Market, ~~covenants~~subject ~~of the parties. Subject~~ to certain ~~limitations~~conditions. Specifically, ~~(i)~~ the ~~Seller~~Panel ~~Parties~~conditioned ~~will indemnify~~ the ~~Buyer~~Company’s ~~and~~continued ~~its affiliates~~listing ~~and~~on ~~representatives~~the ~~against~~Company ~~certain~~regaining ~~losses~~compliance ~~related~~with ~~to,~~the ~~among~~Timely ~~other~~Filing ~~things,~~Requirement ~~breaches~~and of the ~~Seller Parties~~Stockholders’ ~~representations, warranties~~Equity Requirement on or ~~covenants,~~before ~~any~~December ~~liabilities~~31, ~~other~~2025 ~~than~~and ~~those~~regaining ~~assumed~~compliance bywith the ~~Buyer~~Bid ~~under~~Price ~~the~~Rule ~~August~~on 27or ~~Purchase~~before ~~Agreement~~January 28, ~~assets~~2026. ~~excluded from~~During the ~~Acquisition,~~exception ~~pre-closing taxes~~period, ~~operation of~~ the ~~CEA~~Company ~~business~~is ~~and~~required ~~pre-closing~~to ~~employment~~provide ~~matters,~~prompt ~~and~~notification ~~(ii)~~to the ~~Buyer~~Panel ~~will~~of ~~indemnify the~~any ~~Seller~~significant ~~Parties~~event ~~and~~that ~~their~~may ~~respective~~affect ~~affiliates~~the ~~and~~Company’s ~~representatives~~compliance ~~against~~with ~~certain~~Nasdaq ~~losses~~requirements. ~~related~~Any todocumentation ~~breaches~~evidencing of the ~~Buyer~~Company’s ~~representations,~~ ~~warranties~~compliance orwill ~~covenants,~~be ~~and~~subject ~~any~~to ~~losses~~review ~~related~~by tothe ~~any~~Panel, ~~asset~~which ~~acquired~~may, byin ~~the~~its ~~Buyer~~discretion, orrequest ~~any~~additional ~~liability~~information ~~assumed~~before bydetermining ~~the~~whether ~~Buyer under~~ the ~~August~~Company 27has ~~Purchase~~regained ~~Agreement~~compliance.

On ● November 518, 2025, ~~the~~– ~~Seller~~Nasdaq ~~Parties~~sent ~~entered~~the ~~into~~Company a ~~Bill~~notice of(the ~~Sale,~~“November ~~Assignment~~18 ~~and~~Notice”) ~~Assumption,~~stating ~~and~~that ~~Purchase~~because ~~Agreement~~the Company had not yet filed its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025 (the “~~November 5~~September ~~Purchase~~30 ~~Agreement~~Form 10-Q”) ~~with~~or ~~2WRGA.~~its ~~Pursuant~~Annual toReport on Form 10-K for the ~~November~~fiscal 5year ~~Purchase~~ended ~~Agreement~~December 31, ~~2WRGA~~2024 ~~acquired~~ (the “~~Follow~~Form ~~On Acquisition~~10-K”) ~~certain~~, ~~customer~~the ~~lists~~Company continues to be out of compliance with Nasdaq Listing Rule 5250(c)(1). Nasdaq Listing Rule 5250(c)(1) requires listed companies to timely file all required periodic financial reports with the ~~Seller~~Securities ~~Parties~~and Exchange Commission.

The purchase price paid by 2WRGA for the Follow On Acquisition consisted of $143,000 in cash. Additionally, pursuant to the November 5 Purchase Agreement, the parties agreed to waive and terminate the non-solicitation provision applicable to 2WRGA that was contained in the August 27 Purchase Agreement among the Seller Parties, the Company and the other parties thereto.22

●

On January 6, 2026, the Company received a determination letter (the “January 6, 2026 Determination”) from Nasdaq stating that because the Company did not hold an annual meeting of stockholders within twelve months from the Company’s prior fiscal year end as required by Nasdaq Listing Rule 5620(a), the resulting non-compliance would be an additional basis for delisting the Company’s securities. The January 6, 2026 Determination notified the Company that the Panel would consider the matter in their decision regarding the Company’s continued listing on the Nasdaq Capital Market, and requested that the Company present its views with respect to the additional deficiency in writing by January 9, 2026. The Company intends to make a submission to the Panel by the requested date, and has requested an additional extension to comply with the Bid Price Rule, the Stockholders’ Equity Requirement and the Timely Filing Requirement.

●

On January 13, 2026, the Panel notified the Company that it had granted a further extension to regain compliance with the Stockholders’ Equity Requirement, the Annual Meeting Requirement and the Timely Filing Requirement on or before February 17, 2026 and with the Bid Price Rule on or before February 24, 2026.

~~During the~~Services ~~fourth quarter of 2025, the Company began winding down the remaining services businesses and furloughed those employees.~~Business

~~Binding Letter~~During the fourth quarter of ~~Intent~~2025, ~~with~~the ~~Flash~~Company ~~Sports~~continued &winding ~~Media,~~down the ~~Inc~~remaining services businesses and furloughed those employees.

~~On October~~Binding ~~14,~~Letter ~~2025, the Company entered into a binding letter~~ of ~~intent~~Intent ~~(the “LOI”)~~ with Flash Sports & Media, Inc. (“Flash”) regarding a proposed transaction pursuant to which the parties intend to merge Flash with and into a newly formed wholly-owned subsidiary of the Company, which would then merge with and into a second wholly-owned subsidiary of the Company (collectively, the “Merger”).

~~Pursuant to~~On ~~the~~October ~~LOI~~14, ~~the parties have agreed~~2025, ~~subject~~the toCompany entered ~~satisfaction~~into ~~of certain conditions, to negotiate and execute~~ a ~~definitive~~binding ~~merger~~letter ~~agreement in~~of ~~accordance~~intent ~~with~~ (the ~~terms set forth in the~~ “LOI.”) ~~The~~with ~~LOI provides that~~ Flash ~~would~~Sports ~~pay~~& ~~to the Company a cash deposit of $200~~Media,~~000~~ ~~within fifteen days of its execution~~Inc. ~~In connection with the Merger, the stockholders of Flash would receive~~ (i“Flash”) ~~unregistered~~regarding ~~shares of the~~a ~~Company’s~~proposed ~~common~~transaction ~~stock,~~pursuant ~~par value $0.001 per share (“Common Stock”) equal~~ to ~~19.99%~~which of the ~~outstanding~~parties ~~shares~~intend ~~of Common Stock as of immediately prior~~ to ~~the~~merge ~~Merger,~~Flash with and ~~(ii)~~into ~~unregistered shares of~~ a newly~~-created~~ ~~series~~formed ~~of non~~wholly-~~voting~~owned ~~preferred~~subsidiary ~~stock~~of ~~that~~the Company, which would bethen ~~economically~~merge ~~equivalent~~with ~~to Common Stock (the “Preferred Stock”)~~ and ~~would automatically convert~~ into ~~Common~~a ~~Stock upon~~second ~~receipt~~wholly-owned subsidiary of ~~approval by~~ the Company’s ~~stockholders~~(collectively, the “Merger”).

~~The LOI~~Pursuant ~~contemplates~~to ~~that~~the LOI, the ~~former~~parties have ~~stockholders~~agreed, subject to satisfaction of certain conditions, to negotiate and execute a definitive merger agreement in accordance with the terms set forth in the LOI. The LOI provides that Flash would ~~own~~pay ~~approximately~~to ~~90%~~the Company a cash deposit of ~~the~~$200,000 ~~Company~~within ~~following~~fifteen days of its execution. In connection with the Merger, ~~assuming~~the ~~full conversion~~stockholders of ~~the~~Flash ~~Preferred~~would ~~Stock.~~receive ~~Upon~~(i) ~~closing~~unregistered shares of the ~~Merger~~Company’s common stock, ~~the~~par ~~Company~~value ~~would~~$0.001 ~~change~~per ~~its~~share ~~name~~(“Common Stock”) equal to ~~Flash~~19.99% ~~Sports~~of &the ~~Media~~outstanding ~~Holdings,~~shares of Common Stock as of immediately ~~Inc.~~prior orto the Merger, and (ii) unregistered shares of a ~~similar~~newly-created ~~name.~~series ~~The~~of ~~Company~~non-voting preferred stock that would be ~~required~~economically equivalent to ~~obtain~~Common ~~approval~~Stock of(the ~~its~~“Preferred ~~stockholders~~Stock”) ~~for~~and ~~conversion~~would ofautomatically ~~the~~convert ~~Preferred~~into Common Stock ~~as soon~~upon asreceipt ~~reasonably~~of ~~practicable~~approval ~~following~~by the Company’s ~~Merger~~stockholders.

The LOI ~~provides~~contemplates that ~~following~~ the ~~Merger,~~former ~~the~~stockholders ~~board~~ of ~~directors~~Flash ~~(the “Board”) of the Company~~ would beown ~~reconstituted~~approximately ~~such~~90% ~~that four members~~ of the ~~Board~~Company ~~would~~following ~~be designated by~~ the ~~Board prior to the~~ Merger, ~~and~~assuming ~~one~~full ~~member~~conversion of the ~~Board would be designated by the~~Preferred ~~former stockholders of Flash~~Stock. Upon ~~approval~~closing of the ~~Company’s~~Merger, ~~stockholders for~~ the ~~conversion~~Company ofwould ~~the~~change ~~Preferred~~its ~~Stock,~~name ~~the~~to ~~Board would~~Flash beSports ~~further~~& ~~reconstituted~~Media ~~such~~Holdings, ~~that~~Inc. ~~one~~or ~~member~~a ofsimilar ~~the~~name. ~~Board~~The Company would be ~~designated~~required byto ~~the~~obtain ~~Board~~approval ~~prior~~of toits ~~the~~stockholders ~~Merger~~for ~~and~~conversion ~~four members~~ of the ~~Board~~Preferred ~~would~~Stock beas ~~designated~~soon byas ~~the~~reasonably ~~former~~practicable following ~~stockholders~~the ~~of Flash~~Merger.

The LOI provides for an exclusivity period of 90 days following the execution of the LOI. During that period, the Company agreed that neither it nor its affiliates will, among other things, solicit, provide any information or enter into any agreement with any other party concerning a transaction similar to the Merger.23

~~Shareholder~~The LOI provides that following ~~Approvals~~the atMerger, the ~~Annual~~board ~~Shareholder~~of ~~Meeting~~directors (the “Board”) of the Company would be reconstituted such that four members of the Board would be designated by the Board prior to the Merger and one member of the Board would be designated by the former stockholders of Flash. Upon approval of the Company’s stockholders for the conversion of the Preferred Stock, the Board would be further reconstituted such that one member of the Board would be designated by the Board prior to the Merger and four members of the Board would be designated by the former stockholders of Flash.

OnThe LOI provides for an exclusivity ~~January~~period ~~30,~~of ~~2026,~~90 days following the ~~shareholders~~execution of the LOI. During that period, the Company ~~approved~~agreed that neither it nor its affiliates will, among other things, solicit, provide any information or enter into any agreement with any other party concerning a transaction similar to the ~~following:~~Merger.

●Shareholder AnApprovals ~~amendment~~at to the ~~Company’s~~Annual 2021 Omnibus Stock Incentive Plan to increase the number of shares authorized for issuance under the plan by 5,000,000 shares (prior to any reverse stock split) and to increase the individual annual award limit to 500,000 shares (prior to any reverse stock split) or 20,000 shares after giving effect to a 1-for-25 reverse stock split.Shareholder Meeting

●On AnJanuary ~~amendment~~30, to2026, the ~~Company’s Amended and Restated Certificate~~ shareholders of ~~Incorporation to effect a reverse stock split of~~ the ~~shares of the~~ Company’s ~~common~~approved ~~stock at a ratio of not less than 1-for-2 and not greater than 1-for-25, with~~ the ~~exact ratio of, effective time of and decision to implement the reverse stock split to be determined by the Board of Directors.~~following:

● An amendment ofto the Company’s ~~Amended~~2021 ~~and~~Omnibus ~~Restated~~Stock ~~Certificate~~Incentive ofPlan ~~Incorporation~~ to increase the number of shares authorized ~~shares~~for ofissuance ~~common~~under ~~stock~~the toplan ~~200~~by 5,000,000. ~~The~~shares ~~number~~(prior ofto any reverse stock split) and to increase the individual annual award limit to 500,000 shares of(prior ~~authorized~~to ~~common~~any reverse stock ~~would~~split), ~~not~~or be20,000 ~~affected~~shares byafter ~~any~~giving effect to a 1-for-25 reverse stock split.

~~Private Placement~~● An amendment to the Company’s Amended and Restated Certificate of ~~Common~~Incorporation ~~Stock~~to effect a reverse stock split of the shares of the Company’s common stock at a ratio of not less than 1-for-2 and not greater than 1-for-25, with the exact ratio of, effective time of and decision to implement the reverse stock split to be determined by the Board of Directors.

~~On January~~● ~~19,~~An ~~2026,~~amendment of the Company’s ~~entered~~Amended ~~into~~and aRestated ~~private~~Certificate ~~placement~~of ~~transaction~~Incorporation ~~pursuant~~ to aincrease ~~Purchase and Subscription Agreement. Under~~ the ~~agreement,~~ ~~the~~number ~~Company~~of ~~agreed~~authorized ~~to issue 1,000,000~~ shares of ~~its~~ common stock atto ~~a purchase price of $0.10 per share for total gross proceeds of $100~~200,000, ~~on a pre–reverse stock split basis~~000. ~~After~~The ~~giving~~number ~~effect~~of toshares ~~the~~of ~~1-for-25~~authorized ~~reverse~~common stock ~~split,~~would ~~this~~not isbe ~~equivalent~~affected ~~to 40,000~~by ~~shares~~any ofreverse ~~common~~ stock ~~at an adjusted price of $2~~split.~~50 per share.~~

~~The transaction~~Private ~~was~~Placement ~~entered~~of ~~into~~Common ~~with One Eyed Jack Enterprises LLC, an accredited investor, in a private offering exempt from registration under applicable securities laws.~~Stock

~~Reverse~~On January 19, 2026, the Company ~~Stock~~entered ~~Split~~into a private placement transaction pursuant to a Purchase and Subscription Agreement. Under the agreement, the Company agreed to issue 1,000,000 shares of its common stock at a purchase price of $0.10 per share for total gross proceeds of $100,000, on a pre–reverse stock split basis. After giving effect to the 1-for-25 reverse stock split, this is equivalent to 40,000 shares of common stock at an adjusted price of $2.50 per share.

~~On February~~The 4,transaction ~~2026,~~was ~~the~~entered into ~~Board~~with ofOne ~~Directors~~Eyed ~~approved~~Jack aEnterprises ~~1-for-25~~LLC, ~~reverse~~an ~~stock~~accredited ~~split~~investor, ofin ~~the~~a ~~Company’s~~private ~~common~~offering ~~stock~~exempt tofrom ~~take~~registration ~~effect~~under ~~on February~~applicable ~~9, 2026~~securities laws.

~~Other~~Reverse Stock ~~Transactions~~Split

~~Subsequent~~On toFebruary ~~June 30~~4, ~~2025~~2026, ~~84,000~~the ~~shares~~ Board of ~~common~~Directors approved a 1-for-25 reverse stock ~~were~~split ~~issued~~of ~~pursuant~~the toCompany’s acommon ~~debt~~stock ~~settlement~~to ~~and~~take ~~63,057 shares~~effect ~~were~~on ~~issued~~February ~~for~~9, ~~services~~2026.

~~ITEM 2.~~ELOC ~~MANAGEMENT’S~~Purchase ~~DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~Agreement

~~The~~On February 4, 2026, ~~following~~the ~~discussion~~Company ~~should~~entered beinto ~~read~~an inequity ~~conjunction~~purchase agreement (the “ELOC Purchase Agreement”) with ~~our~~Hudson ~~condensed~~Global ~~consolidated~~Ventures, ~~financial~~LLC ~~statements~~(the “Investor”), ~~and~~pursuant ~~notes~~to ~~thereto~~which ~~included~~the ~~herein.~~Company has the right, but not the obligation, to direct the Investor to purchase up to ~~See~~$25,000,000 ~~also~~of ~~“CAUTIONARY~~the ~~INFORMATION~~Company’s ~~REGARDING~~common ~~FORWARD-LOOKING~~stock ~~STATEMENTS~~(the “ELOC Shares”) onupon ~~page~~satisfaction ii of ~~this~~certain ~~Report~~terms and conditions contained in the ELOC Purchase Agreement. ~~When~~Sales ~~applicable~~of the ELOC Shares, ~~all~~if ~~share and~~any, ~~per~~are ~~share~~subject ~~amounts~~to ~~presented~~certain ~~herein~~limitations, ~~have~~and ~~been~~may ~~restated~~occur from time to ~~reflect~~time at the ~~implementation~~Company’s ofsole discretion over the 1approximately 24-~~for-25~~month ~~reverse~~period ~~stock~~commencing ~~split~~on asthe ifdate ~~it had~~of ~~occurred~~execution atof the ~~beginning~~ELOC ofPurchase Agreement, unless the ~~earliest~~ELOC ~~period~~Purchase ~~presented~~Agreement is earlier terminated pursuant to its terms.

~~OVERVIEW~~The Investor has no right to require any sales by the Company but is ~~AND~~obligated ~~HISTORY~~to make purchases at the Company’s direction subject to certain conditions. Each purchase must involve an aggregate amount of shares of the Company’s common stock of at least $25,000 but not exceeding the lesser of (i) $2,000,000 or (ii) 200% of the average daily trading volume of the common stock during the three trading days immediately before the date the Company directs the Investor to purchase the shares of common stock (the “Put Notice Date”).

~~In 2025,~~The ~~urban-gro,~~purchase ~~Inc.~~price ~~was~~to be anpaid ~~integrated~~by ~~professional~~the ~~services~~Investor ~~and~~for ~~design-build~~the ~~firm.~~ELOC WeShares ~~offered~~will ~~value-added~~be ~~architectural, engineering, and construction management solutions to~~ the ~~Controlled~~lesser ~~Environment~~of ~~Agriculture~~ (~~“CEA”~~i), ~~industrial,~~ninety ~~healthcare,~~percent ~~and~~(90%) ~~other commercial~~of sectors. Innovation, collaboration, and a commitment to sustainability drove our team to provide exceptional customer experiences. To serve our horticulture clients, we engineered, designed and managed the ~~construction~~average of ~~indoor~~the ~~CEA~~three ~~facilities~~lowest ~~and~~traded ~~then integrate complex~~prices ~~environmental~~of ~~equipment~~the ~~systems~~Company’s ~~into~~common ~~those~~stock ~~facilities.~~during ~~Through~~the ~~this~~ten ~~work,~~trading wedays ~~created~~immediately ~~high-performance~~preceding ~~indoor~~the ~~cultivation~~date ~~facilities~~of ~~for our~~the ~~clients~~Put toNotice ~~grow~~(as ~~specialty~~defined ~~crops,~~in ~~including~~the ~~leafy greens, vegetables, herbs, and plant-based medicines. Our custom-tailored approach~~ELOC toPurchase ~~design,~~Agreement) ~~construction, procurement,~~ and ~~equipment~~(ii) ~~integration~~ninety ~~provided~~percent a(90%) ~~single point~~ of ~~accountability~~the ~~across~~lowest ~~all~~traded ~~aspects~~price of ~~indoor growing~~the ~~operations.~~Company’s Wecommon ~~also~~stock ~~helped~~on ~~our~~any ~~clients~~trading ~~achieve~~day ~~operational efficiency and economic advantages through a full spectrum of professional~~during ~~services~~the ~~and~~period ~~programs~~beginning ~~focused~~ on ~~facility~~the ~~optimization~~date ~~and~~of ~~environmental~~delivery ~~health~~of ~~which~~the ~~established~~Put ~~facilities~~Notice ~~that allowed clients to manage, operate~~ and ~~perform~~continuing atthrough the ~~highest~~date ~~level~~that ~~throughout~~is ~~their~~three ~~entire~~trading ~~cultivation~~days ~~lifecycle once they are up and running. Further,~~immediately wefollowing served a broad range of commercial and governmental entities, providing them with planning, consulting, architectural, engineering and construction design-build services for their facilities. We aimed to work with our clients from the ~~inception~~Clearing ofDate ~~their~~(as ~~project~~defined in a ~~way that provided value throughout~~ the ~~life~~ELOC ofPurchase ~~their facility~~Agreement). ~~We are a trusted partner and advisor to our clients and offer a complete set of engineering and managed services complemented by a vetted suite of select cultivation equipment systems.~~

~~RESULTS~~Actual sales of ELOC OFShares ~~OPERATIONS~~to the Investor from time to time will depend on a variety of factors, including, without limitation, market conditions, the trading price of the Company’s common stock and determinations by the Company as to the appropriate sources of funding for the Company and its operations. The net proceeds that the Company may receive under the ELOC Purchase Agreement, if any, cannot be determined at this time, since the amount will depend on the frequency and prices at which the Company sells ELOC Shares to the Investor, the Company’s ability to meet the conditions of the ELOC Purchase Agreement, the other limitations, terms and conditions of the ELOC Purchase Agreement, and any impacts of the beneficial ownership limitation (described below).

~~Comparison~~As consideration for the Investor’s execution and delivery of the ELOC Purchase Agreement, the Company issued to the Investor certain common stock purchase warrant for the purchase of ~~Results~~55,556 shares of ~~Operations~~the ~~for~~common stock at an exercise price of $12.50 per share, subject to adjustment (the ~~three~~“Warrant”). ~~months~~Under ~~ended~~the ~~June~~Warrant, 30the Investor may exercise the Warrant during the period commencing on February 4, ~~2025~~2026 and ~~2024~~ending on 5:00 p.m. eastern standard time on the date that is five (5) years after February 4, 2026. In addition, the Company will pay up to $20,000 to the Investor’s legal counsel for the Investor’s expenses relating to the preparation of the ELOC Purchase Agreement.

~~During the~~The ~~three~~ELOC ~~months~~Purchase ~~ended June 30, 2025, we generated revenues of $7.76 million compared to revenues of $17.9 million during the three months~~Agreement ~~ended~~contains ~~June~~customary 30representations, ~~2024~~warranties, aconditions ~~decrease~~and ofindemnification ~~$10.1~~obligations ~~million, or approximately 57%. This decrease in revenues is the result~~ of the ~~following changes in individual revenue components:~~parties.

●The Company ~~Equipment~~must obtain ~~systems~~stockholder ~~revenue~~approval ~~decreased~~to ~~$0.26~~issue ~~million~~an aggregate number of shares of common stock to the Investor, under the ELOC Purchase Agreement, in excess of 136,845 shares of common stock outstanding immediately prior to the execution of the ELOC Purchase Agreement.

●In ~~Services~~connection ~~revenue~~with ~~decreased~~the ELOC $1Purchase Agreement, the Company also entered a registration rights agreement with the Investor on February 4, 2026 (the “Registration Rights Agreement”).2 ~~million~~Under ~~due~~the Registration Rights Agreement, the Company is obligated to ~~continued~~file ~~negative~~with ~~market~~the ~~conditions~~SEC ina registration statement for the ~~CEA~~resale ~~sector~~by the Investor of a specified number of shares of the Company’s Common Stock issuable according to the ELOC Purchase Agreement. The Company agreed to file such registration statement within forty-five (45) days of the execution of the ELOC Purchase Agreement, and to file one or more additional registration statements if necessary.

●Unless ~~Construction~~earlier ~~design-build~~terminated as ~~revenue~~provided ~~decreased~~in ~~$8.5~~the ~~million~~ELOC ~~due~~Purchase toAgreement, ~~decreases~~the inELOC ~~our~~Purchase ~~construction~~Agreement ~~design~~will terminate automatically on the earliest to occur of: (i) twenty-~~build~~four ~~revenue~~(24) ~~contracts~~months after the execution of the ELOC Purchase Agreement, ~~and:~~(ii) the date on which the Investor shall have purchased the maximum amount of ELOC Shares issuable under the ELOC Purchase Agreement, or (iii) the effective date of any written notice of termination delivered pursuant to the terms of the ELOC Purchase Agreement.

~~● Other revenues decreased $0.1 million.~~25

~~During~~Pursuant to the ELOC Purchase Agreement, as long as the ~~three~~ELOC ~~months~~Purchase ~~ended~~Agreement ~~June~~is 30effective, ~~2025~~the Company agreed not, ~~cost~~without ofthe ~~revenues~~prior ~~was~~written ~~$7.7~~consent ~~million~~of the ~~compared~~Investor, to ~~$15.5~~enter ~~million~~into ~~during~~an agreement whereby the ~~three~~Company ~~months~~has ~~ended~~the ~~June~~right to “put” its securities to an investor or underwriter ~~30,~~over ~~2024,~~an aagreed ~~decrease~~period of ~~$7.8~~time ~~million,~~and at an agreed price or ~~approximately~~price ~~50%~~formula. ~~Gross~~Additionally, ~~profit~~the ~~was~~Company ~~$0.04~~agreed, ~~million~~without ~~(approximately~~the ~~0.01%~~prior written consent of ~~revenues~~the Investor, not to (i) ~~during~~issue ~~the three~~or ~~months~~sell ~~ended~~any ~~June~~debt 30or equity securities that are convertible into, ~~2025~~exchangeable or exercisable for, ~~compared~~or include the right to ~~$2.4~~receive, ~~million~~additional shares of Common Stock (~~approximately~~a) ~~13%~~at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices of ~~revenue)~~or ~~during~~quotations for the ~~three~~shares ~~months~~of ~~ended~~Common ~~June~~Stock ~~30,~~at ~~2024.~~any time after the initial ~~This~~issuance ~~decrease~~of insuch ~~gross~~debt ~~profit~~or asequity asecurities ~~percentage~~or of(b) ~~revenues~~with a conversion, ~~was~~exercise ~~primarily~~or ~~due~~exchange price that is subject to being reset at some future date after the ~~57%~~initial ~~decrease~~issuance inof ~~total~~such ~~revenues,~~debt ~~compared~~or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock or (ii) issues securities at a ~~lesser~~future determined ~~50%~~price ~~decrease~~(a in“Variable ~~total~~Rate ~~cost~~Transaction”), provided, however, that an Equity Line of ~~revenues~~Credit shall not be deemed to be a Variable Rate Transaction..

~~Operating expenses~~In ~~increased~~connection bywith ~~$0.9~~the ELOC ~~million,~~Purchase ~~or approximately 18%~~Agreement, ~~to $6.0 million for~~ the ~~three~~Company ~~months ended~~has ~~June~~reserved 30200,000 ~~2025,~~shares ~~compared~~of toCommon ~~$5.1~~Stock ~~million~~with ~~for~~ the ~~three~~Transfer ~~months~~Agent ~~ended~~for ~~June~~issuance ~~30,~~in ~~2024.~~connection ~~This~~with ~~overall~~a ~~increase~~Put inNotice ~~operating~~and/or ~~expenses~~an ~~was~~Exercise ~~the result of a $1~~Notice.1 ~~million~~Such ~~increase~~Reserve inShares ~~general and~~do ~~administrative~~not ~~operating~~represent ~~expenses~~issued ~~due~~or tooutstanding ~~increases~~shares inand ~~bad~~are ~~debt~~not ~~expenses~~being ~~and~~registered for aresale ~~$0.2~~pursuant ~~million decrease~~to inthis ~~depreciation~~registration ~~and amortization~~statement.

~~Non-operating~~The ELOC Purchase Agreement ~~expense~~and ~~was~~Warrant ~~relatively~~were ~~flat~~executed ~~for~~prior to the ~~three~~Company’s ~~months~~1-for-25 ~~ended~~reverse ~~June~~stock ~~30,~~split ~~2025~~effected on February 9, ~~compared~~2026. All share numbers and per-share prices in this Current Report have been adjusted to reflect the ~~three~~reverse ~~months~~stock ~~ended~~split. ~~June~~Under 30the terms of the Warrant, ~~2024~~the exercise price and number of shares issuable upon exercise automatically adjusted upon the reverse stock split.

~~Comparison of~~Loan ~~Results of Operations for the six months ended June 30, 2025 and 2024~~Agreement

~~During~~On February 4, 2026, the ~~six~~Company ~~months~~entered ~~ended~~into ~~June~~a ~~30,~~business ~~2025,~~loan weand ~~generated~~security ~~revenues~~agreement (the “Loan Agreement”) with an effective date of ~~$17.~~February 3, ~~million~~2026 ~~compared~~(the “Effective Date”) by and among, Agile Capital Funding, LLC, Agile Lending , LLC, a Virginia limited liability company, each an existing lender to ~~revenues~~the ofCompany ~~$33.3~~and ~~million~~each ~~during~~assignee that becomes a party pursuant to Section 12.1 of the ~~six~~Loan ~~months~~Agreement ~~ended~~(the ~~June 30~~“Lenders”), ~~2024~~the Company and urban-gro Canada Technologies Inc., a ~~decrease~~wholly owned subsidiary of ~~$16~~the ~~million~~Company (individually, collectively, orjointly ~~approximately~~and ~~48%~~severally, the “Guarantors”). ~~This~~The ~~decrease~~Company inexpects ~~revenues~~to isuse the ~~result~~proceeds offor ~~the~~general ~~following~~working ~~changes~~capital inpurposes, ~~individual~~with ~~revenue~~a ~~components:~~primary focus on vendor payments related to the Company’s efforts to comply with Nasdaq requirements.

●Pursuant ~~Equipment~~to ~~systems~~the ~~revenue~~Loan ~~increased~~Agreement, the Lenders extended to the Company a term loan of $1105,000 (the “Term Loan”) to be used to fund the Company’s general business requirements.9 ~~million~~The Loan Agreement is for a term of twenty-eight weeks from the Effective Date (the “Maturity Date”) and includes an administrative agent fee of $5,000 to be remitted to Agile Capital Funding, LLC which was added to the amount of the loan. The Company may make a full prepayment or partial prepayment of the Term Loan, however, upon the prepayment of any principal amount, the Company shall be obligated to pay a premium payment of such principal so paid, which shall be equal to the aggregate and actual amount of interest that would be paid through the Maturity Date (the “Prepayment Fee”); provided however that, if the Company makes a prepayment within 90 calendar days after the Effective Date, the Company will receive the discounted Prepayment Fee that is included in Exhibit E to the Loan Agreement. The Loan contains standard events of default and representations and warranties by the Company and the Lenders including a mandatory prepayment, and an additional five (5%) percent interest rate following the occurrence of an event of default.

●The ~~Services~~term ~~revenue~~loan ~~decreased~~is ~~$2.7~~evidenced by ~~million~~a ~~due~~confessed judgment secured promissory note issued by the Company to ~~continued~~the ~~negative~~Lenders ~~market~~(the ~~conditions~~“Promissory Note”). Pursuant to the Loan Agreement, upon an event of default, the Lenders will receive a security interest in certain of the ~~CEA~~Company’s ~~sector~~assets, subject to certain exceptions.

●Other ~~Construction~~Stock ~~design-build revenue decreased $15.1 million due to decreases in our construction design-build revenue contracts, and:~~Transactions

●Subsequent ~~Other~~to ~~revenues~~September ~~decreased~~30, ~~$0.1~~2025, ~~million~~84,000 shares of common stock were issued pursuant to a debt settlement and 63,057 shares were issued for services.

2526

~~During the~~ITEM ~~six months ended June 30, 2025, cost of revenues was $16~~2.6 ~~million~~MANAGEMENT’S ~~compared~~DISCUSSION toAND ~~$27.9~~ANALYSIS ~~million~~OF ~~during~~FINANCIAL ~~the~~CONDITION ~~six~~AND ~~months~~RESULTS ~~ended~~OF June 30, 2024, a decrease of $11.3 million, or approximately 41%. Gross profit was $0.6 million (approximately 4% of revenues) during the six months ended June 30, 2025, compared to $5.4 million (approximately 16% of revenue) during the six months ended June 30, 2024. This decrease in gross profit as a percentage of revenues, was primarily due to the 48% decrease in total revenues, compared to a lesser 41% decrease in total cost of revenues.OPERATIONS

~~Operating expenses~~The ~~increased~~following bydiscussion should ~~$0.1~~be ~~million,~~read orin ~~approximately~~conjunction ~~1%,~~with toour ~~$10.7~~condensed ~~million~~consolidated ~~for~~financial ~~the~~statements ~~six~~and ~~months~~notes ~~ended~~thereto ~~June~~included ~~30,~~herein. ~~2025,~~See ~~compared~~also to“CAUTIONARY INFORMATION ~~$10.6~~REGARDING ~~million for~~FORWARD-LOOKING ~~the~~STATEMENTS” ~~six~~on ~~months~~page ~~ended~~ii ~~June~~of ~~30,~~this ~~2024~~Report. ~~This~~When ~~overall~~applicable, ~~increase~~all inshare ~~operating~~and ~~expenses~~per ~~was~~share ~~the~~amounts ~~result~~presented herein ofhave abeen ~~$0.6~~restated ~~million~~to ~~increase~~reflect inthe ~~general and~~implementation ~~administrative~~of ~~operating~~the ~~expenses~~1-for-25 ~~due~~reverse tostock ~~increases~~split inas ~~bad~~if ~~debt~~it ~~expenses~~had ~~and~~occurred aat ~~$0.5~~the ~~million~~beginning ~~decrease~~of the inearliest ~~depreciation~~period ~~and amortization~~presented.

~~Non-operating expense~~OVERVIEW ~~was~~AND ~~relatively flat for the six months ended June 30, 2025, compared to the six months ended June 30, 2024.~~HISTORY

~~LIQUIDITY~~In 2025, urban-gro, Inc. was ~~AND~~an ~~CAPITAL~~integrated ~~RESOURCES~~professional services and design-build firm. We offered value-added architectural, engineering, and construction management solutions to the Controlled Environment Agriculture (“CEA”), industrial, healthcare, and other commercial sectors. Innovation, collaboration, and a commitment to sustainability drove our team to provide exceptional customer experiences. To serve our horticulture clients, we engineered, designed and managed the construction of indoor CEA facilities and then integrate complex environmental equipment systems into those facilities. Through this work, we created high-performance indoor cultivation facilities for our clients to grow specialty crops, including leafy greens, vegetables, herbs, and plant-based medicines. Our custom-tailored approach to design, construction, procurement, and equipment integration provided a single point of accountability across all aspects of indoor growing operations. We also helped our clients achieve operational efficiency and economic advantages through a full spectrum of professional services and programs focused on facility optimization and environmental health which established facilities that allowed clients to manage, operate and perform at the highest level throughout their entire cultivation lifecycle once they are up and running. Further, we served a broad range of commercial and governmental entities, providing them with planning, consulting, architectural, engineering and construction design-build services for their facilities. We aimed to work with our clients from the inception of their project in a way that provided value throughout the life of their facility. We are a trusted partner and advisor to our clients and offer a complete set of engineering and managed services complemented by a vetted suite of select cultivation equipment systems.

~~As of~~RESULTS ~~June~~OF 30, 2025, we had negative working capital of $36.2 million, compared to negative working capital of $26.5 million as of December 31, 2024, a decrease of $9.7 million. This decrease in working capital was primarily due to a decrease in accounts receivable of $5.3 million, as well as increases in accounts payable and customer deposits of $5.6 million.OPERATIONS

~~As of~~Comparison ~~June 30, 2025, we had cash~~ of ~~$0.7~~Results ~~million, which represented a decrease~~ of ~~$0.1~~Operations ~~million~~for ~~from December 31, 2024 due to~~ the ~~following changes~~three ~~during the six~~ months ended ~~June~~ September 30, 2025: and 2024

●During ~~Net~~the ~~cash~~three ~~provided~~months byended ~~operating~~September ~~activities~~30, ~~was~~2025, ~~$2.6~~we ~~million.~~generated ~~This source~~ revenues of ~~cash is the net effect of the net loss of~~ $~~10.~~2.3 million, ~~offset~~compared byto ~~non-cash~~revenues ~~expenses~~ of $17.198 million, ~~and~~during anthe ~~increase~~three inmonths ~~net~~ended ~~operating~~September ~~assets~~30, ~~and~~2024, ~~liabilities~~a decrease of $115.86 million., ~~See~~or approximately ~~the~~70%. ~~condensed~~This ~~consolidated~~decrease ~~statements~~in ofrevenues ~~cash~~is ~~flows~~the ~~for~~result ~~further~~of ~~details on~~ the ~~non-cash~~following ~~expenses and net~~ changes in ~~operating~~individual ~~assets~~revenue ~~and liabilities;~~components:

● ~~Net~~Equipment ~~cash~~systems ~~provided~~revenue bydecreased ~~investing activities was~~ $02.0185 million. ~~We have no material commitments for capital expenditures as of June 30, 2025.~~

● ~~Net~~Construction ~~cash~~design-build ~~used~~revenue indecreased ~~financing activities was~~ $2.7 million. ~~Cash~~due ~~used from financing activities primarily relates~~ to ~~payments~~decreases ~~made~~in onour ~~the~~construction ~~Line~~design-build ofrevenue ~~Credit~~contracts, and ~~other~~partially ~~financing~~offset ~~agreements.~~by:

~~CRITICAL ACCOUNTING~~● ~~ESTIMATES~~Other revenues increased $0.03 million.

~~Critical~~During the three months ended ~~Accounting~~September ~~Estimates~~30, 2025, cost of revenues was $2.5 million compared to $7.3 million during the three months ended September 30, 2024, a decrease of $4.7 million, or approximately 65%. Gross loss was $0.17 million (approximately -7% of revenues) during the three months ended September 30, 2025, compared to gross income of $0.69 million (approximately 8.71% of revenue) during the three months ended September 30, 2024. This decrease in gross profit as a percentage of revenues, was primarily due to the 70% decrease in total revenues, compared to a lesser 65% decrease in total cost of revenues.

~~The Company’s~~Operating ~~Unaudited~~expenses ~~Condensed~~decreased ~~Consolidated~~by ~~Financial~~$1.8 ~~Statements~~million, ~~are~~or ~~prepared~~approximately in47%, to ~~conformity with U~~$2.S.1 ~~GAAP.~~million Infor ~~preparing~~ the ~~Company’s Unaudited~~three ~~Condensed~~months ~~Consolidated~~ended ~~Financial~~September ~~Statements~~30, ~~management makes assumptions~~2025, ~~judgments~~compared ~~and~~to ~~estimates~~$3.9 onmillion ~~historical~~for ~~experience and~~the ~~various~~three ~~other~~months ~~factors~~ended ~~that~~September we30, ~~believe to be reasonable under the circumstances~~2024. This ~~Actual~~overall ~~results~~decrease ~~could~~in ~~differ~~operating ~~materially~~expenses ~~from~~was ~~these estimates~~the ~~under~~result ~~different~~of ~~assumptions~~a ~~or conditions~~$1.6 Wemillion ~~regularly~~decrease ~~reevaluate~~in ~~our~~general ~~assumptions, judgments~~ and ~~estimates.~~administrative ~~The~~operating ~~Company’s~~expenses ~~significant~~due ~~accounting~~to ~~policies~~decreases ~~are described~~ in ~~the~~stock ~~Company’s~~based ~~Annual~~expenses ~~Report~~and ona ~~Form~~$0.2 ~~10-K~~million ~~for~~decrease ~~the~~in ~~year~~depreciation ~~ended~~and ~~December 31, 2024~~amortization.

~~Critical~~Non-operating expense increased ~~accounting~~for ~~estimates~~the ~~(“CAE”)~~three ~~are~~months ~~those~~ended ~~estimates~~September ~~that~~30, ~~involve~~2025, acompared ~~significant~~to ~~level~~the ofthree ~~estimation~~months ~~uncertainty~~ended ~~and~~September ~~could~~30, ~~have a~~2024, ~~material~~primarily ~~impact~~due onto ~~our~~the ~~financial~~loss ~~condition~~recognized on orthe ~~results~~foreclosure of ~~operations~~the Construction assets.

~~There have~~Net ~~been~~income no(loss) ~~material~~from ~~changes~~discontinued inoperations ~~CAE~~was in$0.18 ~~the~~million ~~Company’s~~and ($0.30 ~~Annual~~million), ~~Report~~related onto ~~Form~~disposal ~~10-K~~of ~~for~~entities, during the ~~year~~three months ended ~~December 31~~September 30, 2025 and 2024, respectively.

~~ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK~~27

~~As a~~Comparison ~~smaller~~of ~~reporting~~Results ~~company,~~of weOperations ~~are~~for ~~not~~the ~~required~~nine tomonths ~~provide~~ended ~~this~~September 30, ~~information.~~2025 and 2024

26During the nine months ended September 30, 2025, we generated revenues of $16.9 million compared to revenues of $35.8 million during the nine months ended September 30, 2024, a decrease of $18.9 million, or approximately 53%. This decrease in revenues is the result of the following changes in individual revenue components:

~~ITEM 4.~~● ~~CONTROLS~~Equipment ~~AND~~systems ~~PROCEDURES~~revenue decreased $0.9 million.

~~DISCLOSURE CONTROLS~~● ~~AND~~Construction ~~PROCEDURES~~design-build revenue decreased $17.8 million due to decreases in our construction design-build revenue contracts, and:

~~Disclosure Controls~~● ~~and~~Other ~~Procedures~~revenues decreased $0.1 million.

~~Our~~During the nine months ended ~~management~~September 30, ~~with~~2025, cost of revenues was $17.1 million compared to $32.2 million during the ~~participation~~nine months ended September 30, 2024, a decrease of ~~our~~$15.1 ~~Chief~~million, ~~Executive~~or ~~Officer~~approximately 47%. Gross profit (~~“CEO”~~loss) ~~and~~was ~~Chief~~($0.15) ~~Financial~~million ~~Officer~~ (~~“CFO”~~approximately -1% of revenues)~~, has~~ ~~evaluated~~during the ~~effectiveness~~nine ofmonths ended ~~our~~September ~~disclosure~~30, ~~controls~~2025, ~~and~~compared ~~procedures~~to $3.6 million (approximately 10.1% of revenue) during the nine months ended September 30, 2024. This decrease in gross profit as ~~such~~a ~~term~~percentage isof ~~defined~~revenues was primarily due to the 53% decrease in ~~Rules~~total ~~13a-15(e)~~revenues, ~~and~~compared ~~15d-15(e)~~to ~~under~~a lesser 47% ~~the~~decrease ~~Exchange~~in ~~Act)~~total cost of revenues.

~~These controls~~Operating ~~are~~expenses ~~designed~~decreased toby ~~ensure~~$1.1 ~~that~~million, ~~information~~or ~~required~~approximately 9%, to be$11.5 ~~disclosed~~million infor the ~~reports~~nine wemonths ~~file~~ended orSeptember ~~submit~~30, ~~pursuant~~2025, compared to ~~the~~$12.6 ~~Exchange~~million ~~Act is~~for ~~recorded,~~the ~~processed,~~nine ~~summarized~~months ~~and~~ended ~~reported~~September ~~within~~30, ~~the~~2024. This ~~time~~overall ~~periods~~decrease ~~specified~~ in ~~the~~operating ~~rules~~expenses ~~and~~was ~~forms~~the result of ~~the~~a ~~SEC,~~$0.5 ~~and~~million ~~that~~decrease ~~such~~in ~~information is~~general ~~accumulated~~ and ~~communicated~~administrative operating expenses due to ~~our~~decreases ~~management,~~in ~~including~~bad ~~our~~debt ~~CEO~~charges and ~~CFO~~a to$0.6 ~~allow~~million ~~timely~~decrease ~~decisions~~in ~~regarding~~depreciation ~~required~~and ~~disclosure~~amortization.

~~Based on~~Non-operating ~~such~~expense ~~evaluation,~~increased for ~~our~~the ~~CEO~~nine ~~and~~months ~~CFO~~ended ~~concluded,~~September ~~that our disclosure controls and procedures were not effective as of June~~ 30, 2025, ~~because of~~compared ~~the~~to ~~material~~nine ~~weaknesses~~three ~~resulting~~months ~~from~~ended ~~lack~~September of30, ~~a formalized internal control framework in accordance with COSO~~2024, asprimarily ~~described~~due into ~~Item 9A~~the ofloss ~~our Annual Report~~ recognized on ~~Form~~the ~~10-K~~foreclosure as of ~~December~~the ~~31,~~Construction ~~2024~~assets.

~~In light~~Net of(loss) ~~these~~income ~~material~~from ~~weaknesses,~~discontinued operations ~~management~~was ~~performed~~($0.4 ~~additional~~million) ~~analyses, reconciliations,~~ and ~~other~~$0.4 ~~post-closing~~million ~~procedures~~related to ~~determine that~~disposal ~~the~~of ~~Company’s~~entities ~~unaudited~~during ~~condensed consolidated financial statements are prepared in accordance with U.S. GAAP. Based on this review, management concluded that~~ the ~~unaudited~~nine ~~condensed~~months ~~consolidated~~ended ~~financial~~September ~~statements included in this report fairly present in all material respects the Company’s financial condition~~30, ~~results~~2025 ~~of operations~~ and ~~cash flows for the periods presented.~~2024, respectively

~~Changes in~~LIQUIDITY ~~Internal~~AND ~~Control~~CAPITAL ~~over Financial Reporting~~RESOURCES

~~There~~As of September 30, 2025, ~~were~~we nohad ~~changes~~negative inworking ~~our~~capital ~~internal~~of ~~control~~$39.7 ~~over~~million ~~financial~~compared ~~reporting~~to ~~during~~negative ~~the~~working ~~three~~capital ~~months~~of ~~ended~~$26.5 ~~June~~million ~~30,~~as ~~2025,~~of ~~which~~December ~~were~~31, ~~identified~~2024, ina decrease ~~conjunction~~of ~~with~~$13.2 ~~management’s~~million. ~~evaluation~~This ~~required~~decrease byin ~~paragraph~~working ~~(d)~~capital ofwas ~~Rules~~primarily ~~13a-15~~due ~~and~~to ~~15d-15~~a ~~under~~decrease ~~the~~in ~~Exchange~~accounts ~~Act,~~receivable ~~that~~of ~~have materially~~$5.8 ~~affected~~million, oras ~~are~~well ~~reasonably~~as increases ~~likely~~in toaccounts ~~materially~~payable ~~affect,~~and ~~our~~customer ~~internal~~deposits ~~control~~of ~~over~~$4.1 ~~financial reporting~~million.

~~Management’s~~As of September 30, 2025, ~~Plan~~we had cash of $0.06 million, which represented a decrease of $0.8 million from December 31, 2024 due to ~~Remediate~~the following changes during the ~~Material~~nine ~~Weaknesses~~months ended September 30, 2025:

~~As it~~● ~~relates~~Net tocash ~~the~~provided ~~material~~by ~~weaknesses~~operating ~~that~~activities ~~existed~~was as$0.4 million. This source of ~~June~~cash ~~30,~~is ~~2025,~~the wenet ~~are~~effect inof the ~~process~~net loss of ~~designing~~$14.6 ~~and~~million, ~~implementing~~offset ~~remediation plans~~by non-cash expenses of $3.6 million, and ~~taking~~an ~~steps~~increase toin ~~address~~net ~~the~~operating ~~root~~assets ~~cause~~and liabilities of ~~the~~$10.4 ~~material~~million, ~~weaknesses~~offset asby ~~described~~net incash ~~Annual~~provided ~~Report~~by onoperating ~~Form~~activities ~~10-K~~of asdiscontinued operations of ~~December 31,~~$1.2 ~~2024~~million. ~~There~~See ~~have~~the ~~been~~condensed noconsolidated ~~changes~~statements toof cash flows for further details on the ~~remediation~~non-cash ~~plan~~expenses ~~since~~and ~~December~~net ~~31,~~changes ~~2024.~~in operating assets and liabilities;

27● Net cash provided by investing activities was $2.0 million. We have no material commitments for capital expenditures as of September 30, 2025. Net cash provided by investing activities was primarily from discontinued operations.

~~PART II~~● Net cash used in financing activities was $3.2 ~~OTHER~~million. ~~INFORMATION~~Cash used from financing activities primarily relates to payments made on the Line of Credit and other financing agreements.

~~ITEM 1. LEGAL PROCEEDINGS~~28

~~From time~~CRITICAL toACCOUNTING time, the Company is involved in routine litigation that arises in the ordinary course of business. Other than below, there are no other legal proceedings for which management believes the ultimate outcome would have a material adverse effect on the Company’s results of operations and cash flows.ESTIMATES

~~Gemini Loan~~Critical ~~Agreement~~Accounting ~~Amendment and Default~~Estimates

OnThe ~~December~~Company’s ~~13,~~Unaudited ~~2023,~~Condensed ~~our~~Consolidated ~~wholly-owned~~Financial ~~subsidiary~~Statements UGare ~~Construction,~~prepared ~~Inc.~~in ~~d/b/a~~conformity ~~Emerald~~with ~~Construction~~U.S. ~~Management, Inc~~GAAP. ~~(“UG~~In ~~Construction”) entered~~preparing ~~into (i) an interest only asset based revolving loan agreement (~~the ~~“Loan Agreement”) with Gemini Finance Corp. (“Gemini”)~~Company’s ~~pursuant~~Unaudited toCondensed ~~which~~Consolidated ~~Gemini~~Financial ~~extended~~Statements, tomanagement UGmakes ~~Construction~~assumptions, ajudgments ~~secured~~and ~~line~~estimates ofon ~~credit~~historical inexperience and anvarious ~~amount~~other ~~not~~factors tothat ~~exceed~~we ~~$10,000,000,~~believe to be ~~used~~reasonable tounder ~~assist UG~~the ~~Construction~~circumstances. ~~and~~Actual usresults ~~with~~could ~~cash~~differ ~~management,~~materially ~~and~~from ~~(ii)~~these estimates aunder ~~Secured~~different ~~Promissory~~assumptions ~~Note~~or ~~- Revolving issued by UG Construction to Gemini (the “Promissory Note”)~~conditions. ~~Pursuant~~We toregularly ~~the~~reevaluate ~~Promissory~~our ~~Note~~assumptions, ~~each~~judgments ~~draw was due~~ and ~~payable~~estimates. onThe ~~or before 180 days after such draw~~Company’s issignificant ~~funded~~accounting topolicies UGare ~~Construction,~~described ~~subject~~in tothe ~~a mandatory pre-payment upon UG Construction~~Company’s ~~receipt~~Annual ofReport ~~payment~~on ~~for~~Form ~~any~~10-K ~~invoice~~for ~~previously submitted~~the ~~and~~year ~~approved~~ended ~~for~~December 31, ~~financing by Gemini~~2024.

OnCritical ~~March~~accounting ~~18,~~estimates ~~2025, UG Construction entered into an amendment to the Loan Agreement and Promissory Note and waiver with Gemini~~ (~~the~~ “~~Amendment~~CAE”)~~. Pursuant~~ toare ~~the~~those ~~Amendment,~~estimates ~~Gemini~~that ~~waived~~involve ~~any~~a ~~potential~~significant orlevel ~~perceived events~~ of ~~default~~estimation ~~arising~~uncertainty ~~under~~and ~~certain~~could ~~circumstances, which events~~have ~~did~~a ~~not~~material ~~constitute~~impact ~~specified~~on ~~events~~our offinancial ~~default~~condition ~~under the Promissory Note~~ or ~~the~~results ~~Loan~~of ~~Agreement~~operations.

~~Pursuant~~There tohave ~~the Amendment, the Promissory Note was amended to provide that (i) the term during which Gemini may consider advances under the Loan Agreement has~~ been ~~extended~~no tomaterial ~~January~~changes 1,in ~~2026,~~CAE ~~and~~in ~~(ii)~~ the ~~interest~~Company’s ~~applied~~Annual onReport ~~the outstanding principal amount of the Promissory Note will accrue interest at an annual rate of 12%, and all accrued and unpaid interest shall be paid to Gemini~~ on ~~the~~Form ~~first~~10-K ~~business day of each month~~ for the ~~prior~~year ~~month.~~ended The Amendment also amended the Loan Agreement to require monthly reporting of certain accounts receivable and to include a covenant that such accounts receivable equal or exceed 125% of the sum of the total amount drawn down under the Promissory NoteDecember 31, ~~plus outstanding interest, as of the applicable measurement date~~2024. ~~In connection with the execution of the Amendment, we issued to Gemini, as an amendment fee, 150,000 shares of our common stock, or 6,000 shares after giving effect to a 1-for-25 reverse stock split..~~

28ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~On July~~As ~~31, 2025, Gemini issued~~ a ~~notice of~~smaller ~~default~~reporting to UG Construction claiming that UG Construction was in default under the line of credit due to a failure to submit receivables calculations and failing to maintain sufficient eligible accounts and to forward accounts receivable. The notice indicated that the remaining outstanding amount due under the line of credit of approximately $1.76 million was immediately due and payable with default of 1% per week accruing from the June 16company, ~~2025 date of default claimed by Gemini, and that~~ ~~Gemini~~we ~~intended~~are ~~to pursue legal action if full payment was~~ not ~~received~~required byto ~~August~~provide 8,this ~~2025~~information.

~~On August~~ITEM 21, 2025, we received a notification from Gemini stating that Gemini would proceed with a foreclosure and private sale of substantially all of the assets of UG Construction in an Article 9 sale process, pursuant to Section 9601 et seq4. ofCONTROLS ~~the~~AND ~~California Commercial Code (the “Asset Sale”)~~PROCEDURES. ~~The Asset Sale occurred on September 4, 2025, at which Gemini acquired the assets constituting the collateral under the line of credit for $450,000.~~

~~On August~~DISCLOSURE ~~29,~~CONTROLS ~~2025,~~AND Gemini commenced a lawsuit captioned Gemini Finance Corp. v. UG Construction, Inc. et al., case number 25CV2259 W SBC, in the U.S. District Court for the Southern District of California, which lawsuit (the “Lawsuit”) included us and certain of our officers as defendants and pursuant to which Gemini claimed it was owed $1,486,189 (the “Claim Amount”).PROCEDURES

~~On September~~Disclosure ~~26,~~Controls ~~2025, we entered into a Settlement~~ and Mutual General Release (the “Gemini Settlement Agreement”) with Gemini. Pursuant to the terms of the Gemini Settlement Agreement, among other things, we agreed to file a joint motion requesting an expedited fairness hearing under Section 3(a)(10) of the Securities Act of 1933, as amended (the “Securities Act”), which motion was filed on September 30, 2025. Following such fairness hearing, and subject to the satisfaction of all applicable conditions and requirements of Section 3(a)(10) of the Securities Act, we agreed to issue to Gemini shares of our common stock that, upon sale by Gemini, would result in net proceeds to Gemini equal to the Claim Amount, provided that Gemini shall at no time be issued shares if it would beneficially own more than 4.99% of our common stock, and the aggregate number of shares issued to Gemini may not exceed 19.99% of our outstanding common stock as of immediately prior to the signing of the Gemini Settlement Agreement to the extent required by Nasdaq Listing Rule 5635. Additionally, Gemini agreed to use its best efforts to not sell common stock exceeding 10% of our daily volume on any given trading day. Upon the issuance of the last tranche of shares under the Gemini Settlement Agreement, Gemini will dismiss the Lawsuit with prejudice. The Gemini Settlement Agreement also included a customary mutual release of claims by the parties. The fairness hearing occurred on October 14, 2025. Procedures

~~Grow~~Our management, with the participation ~~Hill~~of ~~Default~~our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).

~~On October~~These 1,controls ~~2024,~~are wedesigned to ~~entered~~ensure ~~into~~that aninformation ~~asset-based~~required ~~term~~to ~~Loan~~be ~~Agreement~~disclosed ~~with~~in ~~Grow~~the ~~Hill,~~reports ~~LLC~~we ~~(“Grow~~file ~~Hill”)~~or submit pursuant to ~~which~~the ~~Grow Hill~~Exchange ~~extended~~Act tois usrecorded, ~~a secured loan of $2~~processed,~~100,000~~ summarized ~~with~~and anreported ~~origination~~within ~~fee~~the oftime ~~$100,000,~~periods ~~which~~specified ~~was~~in ~~added~~the torules ~~the~~and ~~amount~~forms of the ~~loan.~~SEC, ~~The loan~~and isthat ~~evidenced~~such byinformation ais ~~Secured~~accumulated and ~~Promissory~~communicated ~~Note issued by us~~ to ~~Grow~~our ~~Hill.~~management, ~~Grow~~including ~~Hill received a security interest in certain of~~ our ~~assets pursuant~~CEO ~~to a security agreement between us~~ and ~~Grow~~CFO ~~Hill~~to ~~(the~~allow ~~“Security~~timely ~~Agreement”),~~decisions ~~which~~regarding ~~does~~required ~~not include any assets of our subsidiaries~~disclosure.

~~On October~~Based ~~14,~~on ~~2025~~such evaluation, our weCEO ~~received~~and ~~service~~CFO ofconcluded, ~~process~~that ~~for~~our adisclosure ~~lawsuit~~controls ~~filed~~and byprocedures ~~Grow~~were ~~Hill~~not ~~against~~effective usas ~~in the District Court for the City and County~~ of ~~Denver~~September 30, ~~Colorado~~2025 ~~(Case~~because ~~No. 2025CV33546) alleging breach~~ of ~~contract and fraud. Pursuant~~ the ~~complaint, Grow Hill stated that we were~~material inweaknesses ~~default~~resulting ~~under~~from ~~the~~lack ~~Secured~~of ~~Promissory Note due to~~ a ~~failure~~formalized tointernal ~~timely~~control ~~make~~framework ~~payments,~~in ~~and~~accordance ~~elected~~with ~~to accelerate all amounts due under the Secured Promissory Note~~COSO, ~~including~~as adescribed ~~default~~in ~~fee~~Item ~~equal~~9A ~~to 1%~~ of ~~the~~our ~~outstanding principal amount. We are currently investigating~~Annual ~~available~~Report ~~options~~on toForm ~~resolve~~10-K ~~the~~as ~~complaint~~of ~~and~~December ~~intends~~31, ~~to vigorously defend the allegation of fraud~~2024.

29In light of these material weaknesses, management performed additional analyses, reconciliations, and other post-closing procedures to determine that the Company’s unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP. Based on this review, management concluded that the unaudited condensed consolidated financial statements included in this report fairly present in all material respects the Company’s financial condition, results of operations and cash flows for the periods presented.

JChanges ~~Brrothers Settlement~~in Internal Control over Financial Reporting

~~On August~~There 8,were ~~2025,~~no wechanges ~~entered~~in ~~into a Settlement and Release Agreement (the “Settlement Agreement”) with J Brrothers LLC (“J~~our ~~Brrothers”)~~internal ~~and~~control ~~Herb-a-More~~over ~~LLC~~financial ~~relating~~reporting toduring ~~a dispute arising from amounts due for certain heating, ventilation and air conditioning equipment. Pursuant to~~ the ~~terms~~three ofmonths ~~the~~ended ~~Settlement~~September ~~Agreement~~30, ~~among other things~~2025, wewhich ~~issued~~were aidentified ~~promissory~~in ~~note~~conjunction ~~to J Brrothers~~ with an ~~original~~management’s ~~principal~~evaluation ~~amount~~required ofby ~~$395,556~~paragraph ~~and~~(d) ~~issued 150,000 unregistered shares~~ of ~~our~~Rules ~~common stock, or 6,000 shares after giving effect to a 1~~13a-~~for-25~~15 ~~reverse stock split, to J Brrothers. The note accrues simple interest at an annual rate of 12%~~ and ~~has~~15d-15 aunder ~~maturity date of March 18, 2026. The note must be repaid in monthly installments over a period of eight months, with~~ the ~~first~~Exchange ~~seven payments being $50~~Act,~~000~~ ~~per~~that ~~month~~have ~~and~~materially ~~the final monthly payment being $64~~affected,~~047. Any remaining principal and accrued but unpaid interest will become due~~ ~~and~~or ~~payable~~are onreasonably ~~the~~likely ~~maturity~~to ~~date,~~materially ~~and the note may be prepaid without penalty. The note includes customary representations and warranties~~affect, ~~customary~~ ~~events~~our ofinternal ~~default~~control ~~and~~over afinancial ~~17% default interest rate~~reporting.

~~2WR of~~Management’s ~~Georgia~~Plan ~~Sale~~to Remediate the Material Weaknesses

~~On August~~As ~~27,~~it ~~2025,~~relates ~~certain~~to ofthe ~~our~~material weaknesses ~~subsidiaries~~that ~~entered~~existed ~~into~~as aof ~~Stock~~September ~~and~~30, ~~Asset~~2025, ~~Purchase~~we ~~Agreement~~are (in the ~~“2WR~~process ~~Purchase~~of ~~Agreement”) with~~designing ~~2WR~~and ~~Holdco,~~implementing ~~LLC~~remediation ~~(the~~plans ~~“Buyer”).~~and ~~Pursuant~~taking steps to ~~the~~address ~~2WR Purchase Agreement,~~ the ~~Buyer~~root ~~acquired~~cause ~~all~~ of the ~~outstanding~~material ~~shares of~~weaknesses ~~stock~~as ofdescribed ~~2WR~~in ofAnnual ~~Georgia,~~Report ~~Inc.~~on ~~and~~Form ~~certain~~10-K ~~assets~~as of ~~our~~December ~~other subsidiaries relating to those entities’ business of providing commercial~~31, ~~industrial and municipal architectural and construction administration services for projects not involving CEA~~2024. ~~The~~There ~~purchase~~have been ~~price~~no ~~paid~~changes byto the ~~Buyer~~remediation ~~consisted~~plan ofthat ~~$2.0~~was ~~million~~disclosed in ~~cash,~~Annual ~~offset~~Report byon aForm ~~previous~~10-K ~~deposit~~as of ~~$500~~December 31,~~000~~ ~~and by any assumed indebtedness~~2024.

~~MJ’s Market, Inc~~29

~~MJ’s Market,~~PART ~~Inc~~II. v.OTHER Urban-Gro, Inc. et al, pending in the Suffolk County Superior Court in Massachusetts as Civil Action No. 2384-cv-02794. The original complaint, filed by MJ’s Market, Inc, alleged that the Corporation prepared deign drawings for the plaintiff and subsequently sold those drawings to a competitor. The original complaint asserted claims for Breach of Contract; violation of M.G.L. c. 93A; Breach of the Covenant of Good Faith and Fair Dealing; Trademark Infringement; and Interference with Contractual Relations against the Corporation. An amended complaint has been filed which names 2WR of Colorado, Inc., which is characterized as a subsidiary or affiliate of the Corporation, in place of the Corporation. The lawsuit is ongoing.INFORMATION

ITEM 1A 1. ~~RISK~~LEGAL ~~FACTORS~~PROCEEDINGS

~~As of~~From ~~the~~time ~~date~~to ~~of this Quarterly Report on Form 10-Q~~time, ~~there~~the ~~have~~Company is ~~been~~involved noin ~~additional~~routine ~~material~~litigation ~~changes~~that toarises ~~the risk factors disclosed~~ in ~~our annual~~the ~~report~~ordinary oncourse ~~Form~~of ~~10-K~~business. ~~for~~Other ~~the~~than ~~fiscal~~below, ~~year~~there ~~ended~~are ~~December~~no ~~31,~~other ~~2024.~~legal Weproceedings for ~~may~~which ~~disclose~~management ~~changes~~believes tothe ~~such~~ultimate ~~risk~~outcome ~~factors~~would orhave ~~disclose~~a ~~additional risk~~material ~~factors~~adverse ~~from~~effect ~~time~~on tothe ~~time~~Company’s inresults ~~our~~of ~~future~~operations ~~filings~~and cash ~~with the SEC~~flows.

~~ITEM 2.~~Gemini ~~UNREGISTERED~~Loan ~~SALES~~Agreement OFAmendment ~~EQUITY~~and ~~SECURITIES AND USE OF PROCEEDS~~Default

~~Unregistered~~On December 13, 2023, our ~~Shares~~wholly-owned ~~Issued~~subsidiary UG Construction, Inc. d/b/a Emerald Construction Management, Inc. (“UG Construction”) entered into (i) an interest only asset based revolving loan agreement (the “Loan Agreement”) with Gemini Finance Corp. (“Gemini”) pursuant to which Gemini extended to UG Construction a secured line of credit in ~~Connection~~an amount not to exceed $10,000,000, to be used to assist UG Construction and us with ~~Acquisitions~~cash management, and (ii) a Secured Promissory Note - Revolving issued by UG Construction to Gemini (the “Promissory Note”). Pursuant to the Promissory Note, each draw was due and payable on or before 180 days after such draw is funded to UG Construction, subject to a mandatory pre-payment upon UG Construction’s receipt of payment for any invoice previously submitted and approved for financing by Gemini.

~~The foregoing~~On ~~issuances~~March of18, ~~restricted~~2025, ~~shares~~UG ofConstruction entered ~~common~~into ~~stock~~an ~~were~~amendment ~~issued~~to ~~under Section 4(a)(2) of~~ the ~~Securities~~Loan ~~Act~~Agreement ofand ~~1933,~~Promissory asNote ~~amended,~~ and ~~Rule~~waiver ~~506~~with ofGemini ~~Regulation~~(the ~~D promulgated thereunder~~“Amendment”). ~~The~~Pursuant ~~Company believes~~ to the ~~issuances~~Amendment, ofGemini ~~the~~waived ~~foregoing~~any ~~restricted~~potential ~~shares~~or ~~were~~perceived ~~exempt from~~events ~~registration~~of asdefault ~~each~~arising ~~was~~under acertain ~~privately negotiated~~circumstances, ~~isolated,~~which ~~non-recurring~~events ~~transaction~~did not ~~involving~~constitute specified aevents ~~public~~of ~~solicitation.~~default Nounder ~~commissions were paid regarding~~ the ~~share~~Promissory ~~issuances,~~Note ~~and~~or the ~~share~~Loan ~~certificates were issued with a Rule 144 restrictive legend~~Agreement.

~~Repurchase~~Pursuant to the Amendment, the Promissory Note was amended to provide that (i) the term during which Gemini may consider advances under the Loan Agreement has been extended to January 1, 2026, and (ii) the interest applied on the outstanding principal amount of ~~Equity~~the ~~Securities~~Promissory Note will accrue interest at an annual rate of 12%, and all accrued and unpaid interest shall be paid to Gemini on the first business day of each month for the prior month. The Amendment also amended the Loan Agreement to require monthly reporting of certain accounts receivable and to include a covenant that such accounts receivable equal or exceed 125% of the sum of the total amount drawn down under the Promissory Note, plus outstanding interest, as of the applicable measurement date. In connection with the execution of the Amendment, we issued to Gemini, as an amendment fee, 150,000 shares of our common stock, or 6,000 shares after giving effect to a 1-for-25 reverse stock split.

WeOn July 31, 2025, Gemini issued ~~did~~a ~~not~~notice of ~~repurchase~~default ~~any~~to UG Construction claiming that UG Construction was in default under the line of ~~our~~credit ~~registered~~due ~~equity~~to ~~securities~~a ~~during~~failure to submit receivables calculations and failing to maintain sufficient eligible accounts and to forward accounts receivable. The notice indicated that the ~~period~~remaining ~~covered~~outstanding amount due under the line of credit of approximately $1.76 million was immediately due and payable with default of 1% per week accruing from the June 16, 2025 date of default claimed by ~~this~~Gemini, ~~Quarterly~~and ~~Report~~that onGemini ~~Form~~intended ~~10-Q~~to pursue legal action if full payment was not received by August 8, 2025.

~~ITEM~~On August 21, 2025, we received 3a notification from Gemini stating that Gemini would proceed with a foreclosure and private sale of substantially all of the assets of UG Construction in an Article 9 sale process, pursuant to Section 9601 et seq. ~~DEFAULTS~~of ~~UPON~~the ~~SENIOR~~California ~~SECURITIES~~Commercial Code (the “Asset Sale”). The Asset Sale occurred on September 4, 2025, at which Gemini acquired the assets constituting the collateral under the line of credit for $450,000.

~~None~~On August 29, 2025, Gemini commenced a lawsuit captioned Gemini Finance Corp. v. UG Construction, Inc. et al., case number 25CV2259 W SBC, in the U.S. District Court for the Southern District of California, which lawsuit (the “Lawsuit”) included us and certain of our officers as defendants and pursuant to which Gemini claimed it was owed $1,486,189 (the “Claim Amount”).

~~ITEM~~On September 26, 2025, we entered into a Settlement and Mutual General Release (the “Gemini Settlement Agreement”) with Gemini. Pursuant to the terms of the Gemini Settlement Agreement, among other things, we agreed to file a joint motion requesting an expedited fairness hearing under Section 3(a)(10) of the Securities Act of 1933, as amended (the “Securities Act”), which motion was filed on September 30, 2025. Following such fairness hearing, and subject to the satisfaction of all applicable conditions and requirements of Section 3(a)(10) of the Securities Act, we agreed to issue to Gemini shares of our common stock that, upon sale by Gemini, would result in net proceeds to Gemini equal to the Claim Amount, provided that Gemini shall at no time be issued shares if it would beneficially own more than 4.99% of ~~MINE~~our ~~SAFETY~~common ~~DISCLOSURE~~stock, and the aggregate number of shares issued to Gemini may not exceed 19.99% of our outstanding common stock as of immediately prior to the signing of the Gemini Settlement Agreement to the extent required by Nasdaq Listing Rule 5635. Additionally, Gemini agreed to use its best efforts to not sell common stock exceeding 10% of our daily volume on any given trading day. Upon the issuance of the last tranche of shares under the Gemini Settlement Agreement, Gemini will dismiss the Lawsuit with prejudice. The Gemini Settlement Agreement also included a customary mutual release of claims by the parties. The fairness hearing occurred on October 14, 2025.

~~Not Applicable.~~30

~~ITEM 5.~~Grow ~~OTHER~~Hill ~~INFORMATION~~Default

~~None~~On October 1, 2024, we entered into an asset-based term Loan Agreement with Grow Hill, LLC (“Grow Hill”) pursuant to which Grow Hill extended to us a secured loan of $2,100,000 with an origination fee of $100,000, which was added to the amount of the loan. The loan is evidenced by a Secured Promissory Note issued by us to Grow Hill. Grow Hill received a security interest in certain of our assets pursuant to a security agreement between us and Grow Hill (the “Security Agreement”), which does not include any assets of our subsidiaries.

30On October 14, 2025, we received service of process for a lawsuit filed by Grow Hill against us in the District Court for the City and County of Denver, Colorado (Case No. 2025CV33546) alleging breach of contract and fraud. Pursuant the complaint, Grow Hill stated that we were in default under the Secured Promissory Note due to a failure to timely make payments, and elected to accelerate all amounts due under the Secured Promissory Note, including a default fee equal to 1% of the outstanding principal amount. We are currently investigating available options to resolve the complaint and intends to vigorously defend the allegation of fraud.

~~ITEM 6.~~J ~~EXHIBITS~~Brrothers Settlement

Exhibit No.		Exhibit Description
31.1		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Schema Document
101.CAL		Inline XBRL Calculation Linkbase Document
101.DEF		Inline XBRL Definition Linkbase Document
101.LAB		Inline XBRL Label Linkbase Document
101.PRE		Inline XBRL Presentation Linkbase Document
104		Cover Page Interactive Data File (Embedded within the Inline XBRL document)
104		Cover Page Interactive Data File (Embedded within the Inline XBRL

On August 8, 2025, we entered into a Settlement and Release Agreement (the “Settlement Agreement”) with J Brrothers LLC (“J Brrothers”) and Herb-a-More LLC relating to a dispute arising from amounts due for certain heating, ventilation and air conditioning equipment. Pursuant to the terms of the Settlement Agreement, among other things, we issued a promissory note to J Brrothers with an original principal amount of $395,556 and agreed to issue 150,000 unregistered shares of our common stock, or 6,000 shares after giving effect to a 1-for-25 reverse stock split, to J Brrothers. The note accrues simple interest at an annual rate of 12% and has a maturity date of March 18, 2026. The note must be repaid in monthly installments over a period of eight months, with the first seven payments being $50,000 per month and the final monthly payment being $64,047. Any remaining principal and accrued but unpaid interest will become due and payable on the maturity date, and the note may be prepaid without penalty. The note includes customary representations and warranties, customary events of default and a 17% default interest rate.

31MJ’s Market, Inc

~~SIGNATURES~~MJ’s Market, Inc. v. Urban-Gro, Inc. et al, pending in the Suffolk County Superior Court in Massachusetts as Civil Action No. 2384-cv-02794. The original complaint, filed by MJ’s Market, Inc, alleged that the Corporation prepared deign drawings for the plaintiff and subsequently sold those drawings to a competitor. The original complaint asserted claims for Breach of Contract; violation of M.G.L. c. 93A; Breach of the Covenant of Good Faith and Fair Dealing; Trademark Infringement; and Interference with Contractual Relations against the Corporation. An amended complaint has been filed which names 2WR of Colorado, Inc., which is characterized as a subsidiary or affiliate of the Corporation, in place of the Corporation. The lawsuit is ongoing.

~~Pursuant to~~RK ~~the~~Mechanical ~~requirements~~- ofcomplaint ~~the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 10, 2026.~~filed

~~URBAN~~On June 27, 2025, RK Mechanical LLC (“RK”) filed a complaint against UG Construction and certain other defendants, with SVC Manufacturing Inc. as cross-~~GRO~~claimant and UG Construction as cross-defendant, ~~INC~~in the Superior Court of Arizona for Maricopa County (Case No. ~~By:~~CV2025-022680). ~~/s/~~The ~~Bradley~~complaint ~~Nattrass~~alleged that ~~Bradley~~UG ~~Nattrass~~Construction ~~Chairperson~~served as general contractor for the construction of the ~~Board~~construction of ~~Directors~~a PepsiCo plant in Tolleson, Arizona, and that ~~Chief~~as ~~Executive~~a ~~Officer~~result ~~(Principal~~of ~~Executive~~work ~~Officer)~~completed ~~By:~~by ~~/s/~~RK, ~~Richard~~UG ~~Akright~~Construction ~~Richard~~owed A$1,522,716 to RK as a result of alleged breach of contract, breach of implied covenant of good faith and fair dealing, violation of the Arizona Prompt Payment Act, and lien foreclosure. ~~Akright~~On ~~Chief~~or ~~Financial~~about ~~Officer~~October ~~(Principal~~2025, a ~~Financial~~default ~~Officer)~~judgment ~~(Principal~~was ~~Accounting~~entered ~~Officer)~~against UG Construction for $1,511,716, plus prejudgment interest of $288,346 and post-judgment interest at 8.25% plus $10,057 in attorney fees.

32Action Equipment - complaint filed

http://fasb.org/srt/2025#ChiefExecutiveOfficerMember 0001706524 false Q2 --12-31 0001706524 2025-01-01 2025-06-30 0001706524 2026-02-06 0001706524 2025-06-30 0001706524 2024-12-31 0001706524 ugro:EquipmentsMember 2025-04-01 2025-06-30 0001706524 ugro:EquipmentsMember 2024-04-01 2024-06-30 0001706524 ugro:EquipmentsMember 2025-01-01 2025-06-30 0001706524 ugro:EquipmentsMember 2024-01-01 2024-06-30 0001706524 us-gaap:ServiceMember 2025-04-01 2025-06-30 0001706524 us-gaap:ServiceMember 2024-04-01 2024-06-30 0001706524 us-gaap:ServiceMember 2025-01-01 2025-06-30 0001706524 us-gaap:ServiceMember 2024-01-01 2024-06-30 0001706524 us-gaap:ConstructionMember 2025-04-01 2025-06-30 0001706524 us-gaap:ConstructionMember 2024-04-01 2024-06-30 0001706524 us-gaap:ConstructionMember 2025-01-01 2025-06-30 0001706524 us-gaap:ConstructionMember 2024-01-01 2024-06-30 0001706524 ugro:OtherMember 2025-04-01 2025-06-30 0001706524 ugro:OtherMember 2024-04-01 2024-06-30 0001706524 ugro:OtherMember 2025-01-01 2025-06-30 0001706524 ugro:OtherMember 2024-01-01 2024-06-30 0001706524 2025-04-01 2025-06-30 0001706524 2024-04-01 2024-06-30 0001706524 2024-01-01 2024-06-30 0001706524 us-gaap:CommonStockMember 2023-12-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2023-12-31 0001706524 us-gaap:RetainedEarningsMember 2023-12-31 0001706524 us-gaap:TreasuryStockCommonMember 2023-12-31 0001706524 2023-12-31 0001706524 us-gaap:CommonStockMember 2024-01-01 2024-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-01-01 2024-03-31 0001706524 us-gaap:RetainedEarningsMember 2024-01-01 2024-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2024-01-01 2024-03-31 0001706524 2024-01-01 2024-03-31 0001706524 us-gaap:CommonStockMember 2024-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-03-31 0001706524 us-gaap:RetainedEarningsMember 2024-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2024-03-31 0001706524 2024-03-31 0001706524 us-gaap:CommonStockMember 2024-04-01 2024-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-04-01 2024-06-30 0001706524 us-gaap:RetainedEarningsMember 2024-04-01 2024-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2024-04-01 2024-06-30 0001706524 us-gaap:CommonStockMember 2024-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-06-30 0001706524 us-gaap:RetainedEarningsMember 2024-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2024-06-30 0001706524 2024-06-30 0001706524 us-gaap:CommonStockMember 2024-12-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-12-31 0001706524 us-gaap:RetainedEarningsMember 2024-12-31 0001706524 us-gaap:TreasuryStockCommonMember 2024-12-31 0001706524 us-gaap:CommonStockMember 2025-01-01 2025-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-01-01 2025-03-31 0001706524 us-gaap:RetainedEarningsMember 2025-01-01 2025-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2025-01-01 2025-03-31 0001706524 2025-01-01 2025-03-31 0001706524 us-gaap:CommonStockMember 2025-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-03-31 0001706524 us-gaap:RetainedEarningsMember 2025-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2025-03-31 0001706524 2025-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-04-01 2025-06-30 0001706524 us-gaap:RetainedEarningsMember 2025-04-01 2025-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2025-04-01 2025-06-30 0001706524 us-gaap:CommonStockMember 2025-04-01 2025-06-30 0001706524 us-gaap:CommonStockMember 2025-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-06-30 0001706524 us-gaap:RetainedEarningsMember 2025-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2025-06-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-04-01 2025-06-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-04-01 2024-06-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2025-04-01 2025-06-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2024-04-01 2024-06-30 0001706524 ugro:EquipmentSystemsMember 2025-04-01 2025-06-30 0001706524 ugro:EquipmentSystemsMember 2024-04-01 2024-06-30 0001706524 us-gaap:ServiceMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-04-01 2025-06-30 0001706524 us-gaap:ServiceMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-04-01 2024-06-30 0001706524 us-gaap:ServiceMember ugro:CommercialSectorMember 2025-04-01 2025-06-30 0001706524 us-gaap:ServiceMember ugro:CommercialSectorMember 2024-04-01 2024-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-04-01 2025-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-04-01 2024-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2025-04-01 2025-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2024-04-01 2024-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2025-04-01 2025-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2024-04-01 2024-06-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-04-01 2025-06-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-04-01 2024-06-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2025-04-01 2025-06-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2024-04-01 2024-06-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2025-04-01 2025-06-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2024-04-01 2024-06-30 0001706524 ugro:CommercialSectorMember 2025-04-01 2025-06-30 0001706524 ugro:CommercialSectorMember 2024-04-01 2024-06-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-06-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-06-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2025-01-01 2025-06-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2024-01-01 2024-06-30 0001706524 ugro:EquipmentSystemsMember 2025-01-01 2025-06-30 0001706524 ugro:EquipmentSystemsMember 2024-01-01 2024-06-30 0001706524 us-gaap:ServiceMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-06-30 0001706524 us-gaap:ServiceMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-06-30 0001706524 us-gaap:ServiceMember ugro:CommercialSectorMember 2025-01-01 2025-06-30 0001706524 us-gaap:ServiceMember ugro:CommercialSectorMember 2024-01-01 2024-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2025-01-01 2025-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2024-01-01 2024-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2025-01-01 2025-06-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2024-01-01 2024-06-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-06-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-06-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2025-01-01 2025-06-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2024-01-01 2024-06-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-06-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-06-30 0001706524 ugro:CommercialSectorMember 2025-01-01 2025-06-30 0001706524 ugro:CommercialSectorMember 2024-01-01 2024-06-30 0001706524 us-gaap:ComputerEquipmentMember 2025-06-30 0001706524 us-gaap:ComputerEquipmentMember 2024-12-31 0001706524 us-gaap:FurnitureAndFixturesMember 2025-06-30 0001706524 us-gaap:FurnitureAndFixturesMember 2024-12-31 0001706524 us-gaap:LeaseholdImprovementsMember 2025-06-30 0001706524 us-gaap:LeaseholdImprovementsMember 2024-12-31 0001706524 us-gaap:VehiclesMember 2025-06-30 0001706524 us-gaap:VehiclesMember 2024-12-31 0001706524 us-gaap:SoftwareDevelopmentMember 2025-06-30 0001706524 us-gaap:SoftwareDevelopmentMember 2024-12-31 0001706524 ugro:RDAssetsMember 2025-06-30 0001706524 ugro:RDAssetsMember 2024-12-31 0001706524 us-gaap:OtherMachineryAndEquipmentMember 2025-06-30 0001706524 us-gaap:OtherMachineryAndEquipmentMember 2024-12-31 0001706524 2024-01-01 2024-12-31 0001706524 us-gaap:TrademarksAndTradeNamesMember 2025-06-30 0001706524 ugro:BacklogAndOtherMember 2025-06-30 0001706524 us-gaap:LicensingAgreementsMember 2025-06-30 0001706524 us-gaap:TrademarksAndTradeNamesMember 2024-12-31 0001706524 ugro:BacklogAndOtherMember 2024-12-31 0001706524 us-gaap:LicensingAgreementsMember 2024-12-31 0001706524 us-gaap:LineOfCreditMember ugro:GeminiFinanceCorpMember ugro:UGConstructionIncMember 2023-12-13 0001706524 us-gaap:LineOfCreditMember ugro:GeminiFinanceCorpMember ugro:UGConstructionIncMember 2023-12-13 2023-12-13 0001706524 ugro:SecuredPromissoryNoteMember 2023-12-13 2023-12-13 0001706524 ugro:SecuredPromissoryNoteMember 2023-12-13 0001706524 ugro:BancroftCapitalLLCMember 2023-12-13 0001706524 ugro:TrancheOneMember ugro:BancroftCapitalLLCMember 2023-12-13 2023-12-13 0001706524 ugro:TrancheOneMember ugro:BancroftCapitalLLCMember 2023-12-13 0001706524 2023-12-13 0001706524 2023-12-13 2023-12-13 0001706524 ugro:DVOMember 2025-03-18 0001706524 ugro:DVOMember 2025-03-18 2025-03-18 0001706524 ugro:DVOMember us-gaap:CommonStockMember 2025-03-18 2025-03-18 0001706524 ugro:FeeSharesMember 2025-03-18 0001706524 2025-03-18 2025-03-18 0001706524 ugro:GrowHillLLCMember 2024-10-01 2024-10-01 0001706524 2024-10-01 2024-10-01 0001706524 us-gaap:WarrantMember us-gaap:CommonStockMember 2024-10-01 2024-10-01 0001706524 srt:MaximumMember 2024-10-01 0001706524 srt:MinimumMember 2024-10-01 0001706524 ugro:BusinessLoanAndSecurityAgreementWithAgileEntitiesMember 2025-06-26 0001706524 ugro:BusinessLoanAndSecurityAgreementWithAgileEntitiesMember 2025-06-26 2025-06-26 0001706524 ugro:TruistLineOfCreditMember 2025-05-31 0001706524 ugro:TruistLineOfCreditMember 2025-06-30 0001706524 srt:ScenarioForecastMember ugro:TruistLineOfCreditMember 2025-09-30 0001706524 ugro:OtherFinancingAgreementsMember 2025-06-30 0001706524 us-gaap:LineOfCreditMember 2025-06-30 0001706524 us-gaap:LineOfCreditMember 2024-12-31 0001706524 ugro:DawsonVanOrderIncMember 2025-06-30 0001706524 ugro:DawsonVanOrderIncMember 2024-12-31 0001706524 ugro:GrowHillNoteNetMember 2025-06-30 0001706524 ugro:GrowHillNoteNetMember 2024-12-31 0001706524 ugro:AgileCapitalMember 2025-06-30 0001706524 ugro:AgileCapitalMember 2024-12-31 0001706524 ugro:TruistLineOfCreditMember 2025-06-30 0001706524 ugro:TruistLineOfCreditMember 2024-12-31 0001706524 ugro:InsurancePoliciesMember 2025-06-30 0001706524 ugro:InsurancePoliciesMember 2024-12-31 0001706524 ugro:PromissoryNoteMember 2025-03-18 2025-03-18 0001706524 ugro:PromissoryNoteMember us-gaap:CommonStockMember 2025-03-18 2025-03-18 0001706524 srt:ScenarioForecastMember 2025-07-31 2025-07-31 0001706524 srt:ScenarioForecastMember 2025-08-21 2025-08-21 0001706524 srt:ScenarioForecastMember 2025-08-29 2025-08-29 0001706524 srt:ScenarioForecastMember 2025-09-26 2025-09-26 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2025-09-26 2025-09-26 0001706524 srt:ScenarioForecastMember ugro:GrowHillDefaultMember 2025-10-01 0001706524 srt:ScenarioForecastMember ugro:GrowHillDefaultMember 2025-10-01 2025-10-01 0001706524 srt:ScenarioForecastMember ugro:GrowHillDefaultMember 2025-10-14 2025-10-14 0001706524 srt:ScenarioForecastMember ugro:JBrrothersSettlementMember 2025-08-08 0001706524 srt:ScenarioForecastMember ugro:JBrrothersSettlementMember 2025-08-08 2025-08-08 0001706524 us-gaap:SubsequentEventMember 2025-08-08 2025-08-08 0001706524 srt:MinimumMember srt:ScenarioForecastMember 2025-08-08 2025-08-08 0001706524 srt:MaximumMember srt:ScenarioForecastMember 2025-08-08 2025-08-08 0001706524 srt:ScenarioForecastMember 2025-08-08 2025-08-08 0001706524 srt:ScenarioForecastMember ugro:PurchaseAgreementMember 2025-08-27 0001706524 2025-06-27 0001706524 srt:ScenarioForecastMember 2025-10-31 2025-10-31 0001706524 2025-04-21 2025-04-21 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-04-01 2025-06-30 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-04-01 2024-06-30 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-06-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-04-01 2025-06-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-04-01 2024-06-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-06-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-04-01 2025-06-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-04-01 2024-06-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-06-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-04-01 2025-06-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-04-01 2024-06-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-06-30 0001706524 ugro:CustomerFiveMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-04-01 2025-06-30 0001706524 ugro:CustomerFiveMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-04-01 2024-06-30 0001706524 ugro:CustomerFiveMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerFiveMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-06-30 0001706524 ugro:CustomerOneMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerOneMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerTwoMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerTwoMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerThreeMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerThreeMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerFourMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerFourMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerFiveMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerFiveMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerSixMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerSixMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerSevenMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-06-30 0001706524 ugro:CustomerSevenMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2025-04-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2024-04-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2025-01-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2024-01-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2025-04-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2024-04-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2025-01-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2024-01-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2025-04-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2024-04-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2025-01-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2024-01-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2025-04-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2024-04-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2025-01-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2024-01-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2025-04-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2024-04-01 2024-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2025-01-01 2025-06-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2024-01-01 2024-06-30 0001706524 us-gaap:AccountsPayableMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2025-01-01 2025-06-30 0001706524 us-gaap:AccountsPayableMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2024-01-01 2024-12-31 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2025-04-01 2025-06-30 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2024-04-01 2024-06-30 0001706524 ugro:A2021OmnibusStockIncentivePlanMember 2025-01-01 2025-06-30 0001706524 srt:MinimumMember us-gaap:EmployeeStockOptionMember ugro:A2021OmnibusStockIncentivePlanMember 2025-01-01 2025-06-30 0001706524 srt:MaximumMember us-gaap:EmployeeStockOptionMember ugro:A2021OmnibusStockIncentivePlanMember 2025-01-01 2025-06-30 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2025-06-30 0001706524 ugro:UnvestedStockOptionsMember 2025-06-30 0001706524 srt:ScenarioForecastMember us-gaap:TreasuryStockCommonMember 2026-02-09 2026-02-09 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2025-04-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ServicesMember 2025-04-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2025-04-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2025-04-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember 2025-04-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ServicesMember 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2025-01-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ServicesMember 2025-01-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2025-01-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2025-01-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember 2025-01-01 2025-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2024-04-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ServicesMember 2024-04-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2024-04-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2024-04-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember 2024-04-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ServicesMember 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2024-01-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ServicesMember 2024-01-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2024-01-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2024-01-01 2024-06-30 0001706524 us-gaap:OperatingSegmentsMember 2024-01-01 2024-06-30 0001706524 srt:ScenarioForecastMember 2025-08-18 2025-08-18 0001706524 2025-02-24 2025-02-24 0001706524 srt:ScenarioForecastMember ugro:PromissoryNoteJBrrothersMember 2025-08-08 2025-08-08 0001706524 us-gaap:SubsequentEventMember ugro:SettlementAgreementMember 2025-08-08 2025-08-08 0001706524 srt:ScenarioForecastMember ugro:NotesPayableMember 2025-08-08 2025-08-08 0001706524 srt:MinimumMember srt:ScenarioForecastMember ugro:NotesPayableMember 2025-08-08 2025-08-08 0001706524 srt:MaximumMember srt:ScenarioForecastMember ugro:NotesPayableMember 2025-08-08 2025-08-08 0001706524 srt:ScenarioForecastMember ugro:NotesPayableMember ugro:SettlementAgreementMember 2025-08-08 2025-08-08 0001706524 srt:ScenarioForecastMember 2025-08-27 2025-08-27 0001706524 srt:ScenarioForecastMember 2025-11-05 2025-11-05 0001706524 srt:ScenarioForecastMember 2025-10-14 2025-10-14 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2025-10-14 0001706524 ugro:FlashSportsMediaHoldingsMember 2025-06-30 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2026-01-30 0001706524 srt:ScenarioForecastMember 2026-01-30 2026-01-30 0001706524 srt:ScenarioForecastMember ugro:A2021OmnibusStockIncentivePlanMember 2026-01-30 2026-01-30 0001706524 srt:ScenarioForecastMember 2026-01-30 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2026-01-19 2026-01-19 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2026-01-19 0001706524 srt:ScenarioForecastMember ugro:PurchaseAndSubscriptionAgreementMember 2026-01-19 2026-01-19 0001706524 srt:ScenarioForecastMember ugro:PurchaseAndSubscriptionAgreementMember 2026-01-19 0001706524 ugro:DebtSettlementMember us-gaap:CommonStockMember 2025-01-01 2025-06-30 0001706524 us-gaap:CommonStockMember 2025-01-01 2025-06-30 xbrli:shares iso4217:USD iso4217:USD xbrli:shares xbrli:pure

On April 21, 2025, Action Equip. & Scaffold Co. (“Action”) filed a complaint against UG Construction in the Superior Court of Arizona for Maricopa County (Case No. CV2025-014165). The complaint alleged that UG Construction owed Action $380,932 plus interest and attorneys’ fees in connection with a contract pursuant to which Action leased equipment to UG Construction, and alleged breach of contract, breach of covenant of good faith and fair dealing, and unjust enrichment.

ITEM 1A. RISK FACTORS

As of the date of this Quarterly Report on Form 10-Q, there have been no additional material changes to the risk factors disclosed in our annual report on Form 10-K for the fiscal year ended December 31, 2024. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Unregistered Shares Issued in Connection with Acquisitions

The foregoing issuances of restricted shares of common stock were issued under Section 4(a)(2) of the Securities Act of 1933, as amended, and Rule 506 of Regulation D promulgated thereunder. The Company believes the issuances of the foregoing restricted shares were exempt from registration as each was a privately negotiated, isolated, non-recurring transaction not involving a public solicitation. No commissions were paid regarding the share issuances, and the share certificates were issued with a Rule 144 restrictive legend.

Repurchase of Equity Securities

We did not repurchase any of our registered equity securities during the period covered by this Quarterly Report on Form 10-Q.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURE

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit No.		Exhibit Description
31.1		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Schema Document
101.CAL		Inline XBRL Calculation Linkbase Document
101.DEF		Inline XBRL Definition Linkbase Document
101.LAB		Inline XBRL Label Linkbase Document
101.PRE		Inline XBRL Presentation Linkbase Document
104		Cover Page Interactive Data File (Embedded within the Inline XBRL document)
104		Cover Page Interactive Data File (Embedded within the Inline XBRL

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 17, 2026.

	URBAN-GRO, INC.

	By:	/s/ Bradley Nattrass
		Bradley Nattrass
		Chairperson of the Board of Directors and
		Chief Executive Officer
		(Principal Executive Officer)

	By:	/s/ Richard Akright
		Richard A. Akright
		Chief Financial Officer
		(Principal Financial Officer)
		(Principal Accounting Officer)

http://fasb.org/srt/2025#ChiefExecutiveOfficerMember 0001706524 false Q3 --12-31 0001706524 2025-01-01 2025-09-30 0001706524 2026-02-17 0001706524 2025-09-30 0001706524 2024-12-31 0001706524 ugro:EquipmentsMember 2025-07-01 2025-09-30 0001706524 ugro:EquipmentsMember 2024-07-01 2024-09-30 0001706524 ugro:EquipmentsMember 2025-01-01 2025-09-30 0001706524 ugro:EquipmentsMember 2024-01-01 2024-09-30 0001706524 us-gaap:ConstructionMember 2025-07-01 2025-09-30 0001706524 us-gaap:ConstructionMember 2024-07-01 2024-09-30 0001706524 us-gaap:ConstructionMember 2025-01-01 2025-09-30 0001706524 us-gaap:ConstructionMember 2024-01-01 2024-09-30 0001706524 ugro:OtherMember 2025-07-01 2025-09-30 0001706524 ugro:OtherMember 2024-07-01 2024-09-30 0001706524 ugro:OtherMember 2025-01-01 2025-09-30 0001706524 ugro:OtherMember 2024-01-01 2024-09-30 0001706524 2025-07-01 2025-09-30 0001706524 2024-07-01 2024-09-30 0001706524 2024-01-01 2024-09-30 0001706524 us-gaap:CommonStockMember 2023-12-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2023-12-31 0001706524 us-gaap:RetainedEarningsMember 2023-12-31 0001706524 us-gaap:TreasuryStockCommonMember 2023-12-31 0001706524 2023-12-31 0001706524 us-gaap:CommonStockMember 2024-01-01 2024-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-01-01 2024-03-31 0001706524 us-gaap:RetainedEarningsMember 2024-01-01 2024-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2024-01-01 2024-03-31 0001706524 2024-01-01 2024-03-31 0001706524 us-gaap:CommonStockMember 2024-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-03-31 0001706524 us-gaap:RetainedEarningsMember 2024-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2024-03-31 0001706524 2024-03-31 0001706524 us-gaap:CommonStockMember 2024-04-01 2024-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-04-01 2024-06-30 0001706524 us-gaap:RetainedEarningsMember 2024-04-01 2024-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2024-04-01 2024-06-30 0001706524 2024-04-01 2024-06-30 0001706524 us-gaap:CommonStockMember 2024-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-06-30 0001706524 us-gaap:RetainedEarningsMember 2024-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2024-06-30 0001706524 2024-06-30 0001706524 us-gaap:CommonStockMember 2024-07-01 2024-09-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-07-01 2024-09-30 0001706524 us-gaap:RetainedEarningsMember 2024-07-01 2024-09-30 0001706524 us-gaap:TreasuryStockCommonMember 2024-07-01 2024-09-30 0001706524 us-gaap:CommonStockMember 2024-09-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-09-30 0001706524 us-gaap:RetainedEarningsMember 2024-09-30 0001706524 us-gaap:TreasuryStockCommonMember 2024-09-30 0001706524 2024-09-30 0001706524 us-gaap:CommonStockMember 2024-12-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2024-12-31 0001706524 us-gaap:RetainedEarningsMember 2024-12-31 0001706524 us-gaap:TreasuryStockCommonMember 2024-12-31 0001706524 us-gaap:CommonStockMember 2025-01-01 2025-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-01-01 2025-03-31 0001706524 us-gaap:RetainedEarningsMember 2025-01-01 2025-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2025-01-01 2025-03-31 0001706524 2025-01-01 2025-03-31 0001706524 us-gaap:CommonStockMember 2025-03-31 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-03-31 0001706524 us-gaap:RetainedEarningsMember 2025-03-31 0001706524 us-gaap:TreasuryStockCommonMember 2025-03-31 0001706524 2025-03-31 0001706524 us-gaap:CommonStockMember 2025-04-01 2025-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-04-01 2025-06-30 0001706524 us-gaap:RetainedEarningsMember 2025-04-01 2025-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2025-04-01 2025-06-30 0001706524 2025-04-01 2025-06-30 0001706524 us-gaap:CommonStockMember 2025-06-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-06-30 0001706524 us-gaap:RetainedEarningsMember 2025-06-30 0001706524 us-gaap:TreasuryStockCommonMember 2025-06-30 0001706524 2025-06-30 0001706524 us-gaap:CommonStockMember 2025-07-01 2025-09-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-07-01 2025-09-30 0001706524 us-gaap:RetainedEarningsMember 2025-07-01 2025-09-30 0001706524 us-gaap:TreasuryStockCommonMember 2025-07-01 2025-09-30 0001706524 us-gaap:CommonStockMember 2025-09-30 0001706524 us-gaap:AdditionalPaidInCapitalMember 2025-09-30 0001706524 us-gaap:RetainedEarningsMember 2025-09-30 0001706524 us-gaap:TreasuryStockCommonMember 2025-09-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-07-01 2025-09-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-07-01 2024-09-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2025-07-01 2025-09-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2024-07-01 2024-09-30 0001706524 ugro:EquipmentSystemsMember 2025-07-01 2025-09-30 0001706524 ugro:EquipmentSystemsMember 2024-07-01 2024-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-07-01 2025-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-07-01 2024-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2025-07-01 2025-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2024-07-01 2024-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2025-07-01 2025-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2024-07-01 2024-09-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-07-01 2025-09-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-07-01 2024-09-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2025-07-01 2025-09-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2024-07-01 2024-09-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2025-07-01 2025-09-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2024-07-01 2024-09-30 0001706524 ugro:CommercialSectorMember 2025-07-01 2025-09-30 0001706524 ugro:CommercialSectorMember 2024-07-01 2024-09-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-09-30 0001706524 ugro:EquipmentSystemsMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-09-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2025-01-01 2025-09-30 0001706524 ugro:EquipmentSystemsMember ugro:CommercialSectorMember 2024-01-01 2024-09-30 0001706524 ugro:EquipmentSystemsMember 2025-01-01 2025-09-30 0001706524 ugro:EquipmentSystemsMember 2024-01-01 2024-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2025-01-01 2025-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember ugro:CommercialSectorMember 2024-01-01 2024-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2025-01-01 2025-09-30 0001706524 ugro:ConstructionDesignAndBuildingMember 2024-01-01 2024-09-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-09-30 0001706524 ugro:OtherMember ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-09-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2025-01-01 2025-09-30 0001706524 ugro:OtherMember ugro:CommercialSectorMember 2024-01-01 2024-09-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2025-01-01 2025-09-30 0001706524 ugro:ControlledEnvironmentAgricultureSectorMember 2024-01-01 2024-09-30 0001706524 ugro:CommercialSectorMember 2025-01-01 2025-09-30 0001706524 ugro:CommercialSectorMember 2024-01-01 2024-09-30 0001706524 ugro:RevenueRecognizedInExcessOfAmountsPaidOrPayablecontractReceivablesToTheCompanyOnUncompletedContractscontractAssetExcludingRetainageMember 2025-09-30 0001706524 ugro:RevenueRecognizedInExcessOfAmountsPaidOrPayablecontractReceivablesToTheCompanyOnUncompletedContractscontractAssetExcludingRetainageMember 2024-12-31 0001706524 ugro:RetainageIncludedInContractAssetsDueToBeingConditionalOnSomethingOtherThanSolelyPassageOfTimeMember 2025-09-30 0001706524 ugro:RetainageIncludedInContractAssetsDueToBeingConditionalOnSomethingOtherThanSolelyPassageOfTimeMember 2024-12-31 0001706524 ugro:PaymentsReceivedOrReceivablecontractReceivablesInExcessOfRevenueRecognizedOnUncompletedContractscontractLiabilityExcludingRetainageMember 2025-09-30 0001706524 ugro:PaymentsReceivedOrReceivablecontractReceivablesInExcessOfRevenueRecognizedOnUncompletedContractscontractLiabilityExcludingRetainageMember 2024-12-31 0001706524 ugro:RetainageIncludedInContractLiabilitiesDueToBeingConditionalOnSomethingOtherThanSolelyPassageOfTimeMember 2025-09-30 0001706524 ugro:RetainageIncludedInContractLiabilitiesDueToBeingConditionalOnSomethingOtherThanSolelyPassageOfTimeMember 2024-12-31 0001706524 ugro:TwoWRGAMember 2025-09-30 0001706524 ugro:TwoWRCOMember 2025-09-30 0001706524 ugro:TwoWRMSMember 2025-09-30 0001706524 ugro:UGENGMember 2025-09-30 0001706524 us-gaap:ServiceMember 2025-07-01 2025-09-30 0001706524 us-gaap:ServiceMember 2024-07-01 2024-09-30 0001706524 us-gaap:ServiceMember 2025-01-01 2025-09-30 0001706524 us-gaap:ServiceMember 2024-01-01 2024-09-30 0001706524 us-gaap:ComputerEquipmentMember 2025-09-30 0001706524 us-gaap:ComputerEquipmentMember 2024-12-31 0001706524 us-gaap:FurnitureAndFixturesMember 2025-09-30 0001706524 us-gaap:FurnitureAndFixturesMember 2024-12-31 0001706524 us-gaap:LeaseholdImprovementsMember 2025-09-30 0001706524 us-gaap:LeaseholdImprovementsMember 2024-12-31 0001706524 us-gaap:VehiclesMember 2025-09-30 0001706524 us-gaap:VehiclesMember 2024-12-31 0001706524 us-gaap:SoftwareDevelopmentMember 2025-09-30 0001706524 us-gaap:SoftwareDevelopmentMember 2024-12-31 0001706524 ugro:RDAssetsMember 2025-09-30 0001706524 ugro:RDAssetsMember 2024-12-31 0001706524 us-gaap:OtherMachineryAndEquipmentMember 2025-09-30 0001706524 us-gaap:OtherMachineryAndEquipmentMember 2024-12-31 0001706524 us-gaap:LineOfCreditMember ugro:GeminiFinanceCorpMember ugro:UGConstructionIncMember 2023-12-13 0001706524 us-gaap:LineOfCreditMember ugro:GeminiFinanceCorpMember ugro:UGConstructionIncMember 2023-12-13 2023-12-13 0001706524 ugro:SecuredPromissoryNoteMember 2023-12-13 2023-12-13 0001706524 ugro:SecuredPromissoryNoteMember 2023-12-13 0001706524 ugro:BancroftCapitalLLCMember 2023-12-13 0001706524 ugro:BancroftCapitalLLCMember 2023-12-13 2023-12-13 0001706524 ugro:TrancheOneMember ugro:BancroftCapitalLLCMember 2023-12-13 2023-12-13 0001706524 ugro:TrancheOneMember ugro:BancroftCapitalLLCMember 2023-12-13 0001706524 2023-12-13 0001706524 2023-12-13 2023-12-13 0001706524 ugro:DVOMember 2025-03-18 0001706524 ugro:DVOMember 2025-03-18 2025-03-18 0001706524 us-gaap:CommonStockMember 2025-03-18 2025-03-18 0001706524 ugro:DVOMember us-gaap:CommonStockMember 2025-03-18 2025-03-18 0001706524 ugro:FeeSharesMember 2025-03-18 0001706524 2025-03-18 2025-03-18 0001706524 ugro:GrowHillLLCMember 2024-10-01 2024-10-01 0001706524 2024-10-01 2024-10-01 0001706524 us-gaap:WarrantMember us-gaap:CommonStockMember 2024-10-01 2024-10-01 0001706524 srt:MaximumMember 2024-10-01 0001706524 srt:MinimumMember 2024-10-01 0001706524 ugro:BusinessLoanAndSecurityAgreementWithAgileEntitiesMember 2025-06-26 0001706524 ugro:BusinessLoanAndSecurityAgreementWithAgileEntitiesMember 2025-06-26 2025-06-26 0001706524 ugro:TruistLineOfCreditMember 2025-05-31 0001706524 ugro:TruistLineOfCreditMember 2025-09-30 0001706524 ugro:PromissoryNoteJBrrothersMember 2025-08-08 2025-08-08 0001706524 ugro:JBrrothersSettlementMember 2025-08-08 2025-08-08 0001706524 2025-08-08 2025-08-08 0001706524 ugro:NotesPayableMember 2025-08-08 2025-08-08 0001706524 srt:MinimumMember ugro:NotesPayableMember 2025-08-08 2025-08-08 0001706524 srt:MaximumMember ugro:NotesPayableMember 2025-08-08 2025-08-08 0001706524 ugro:NotesPayableMember ugro:SettlementAgreementMember 2025-08-08 2025-08-08 0001706524 srt:MinimumMember ugro:OtherFinancingAgreementsMember 2025-09-30 0001706524 srt:MaximumMember ugro:OtherFinancingAgreementsMember 2025-09-30 0001706524 us-gaap:LineOfCreditMember 2025-09-30 0001706524 us-gaap:LineOfCreditMember 2024-12-31 0001706524 ugro:DawsonVanOrderIncMember 2025-09-30 0001706524 ugro:DawsonVanOrderIncMember 2024-12-31 0001706524 ugro:GrowHillNoteNetMember 2025-09-30 0001706524 ugro:GrowHillNoteNetMember 2024-12-31 0001706524 ugro:AgileCapitalMember 2025-09-30 0001706524 ugro:AgileCapitalMember 2024-12-31 0001706524 ugro:JBrrothersMember 2025-09-30 0001706524 ugro:JBrrothersMember 2024-12-31 0001706524 ugro:InsurancePoliciesMember 2025-09-30 0001706524 ugro:InsurancePoliciesMember 2024-12-31 0001706524 ugro:PromissoryNoteMember 2025-03-18 2025-03-18 0001706524 ugro:PromissoryNoteMember us-gaap:CommonStockMember 2025-03-18 2025-03-18 0001706524 2025-07-31 2025-07-31 0001706524 2025-09-04 2025-09-04 0001706524 2025-08-29 2025-08-29 0001706524 2025-09-26 2025-09-26 0001706524 us-gaap:CommonStockMember 2025-09-26 2025-09-26 0001706524 ugro:GrowHillDefaultMember 2024-10-01 0001706524 ugro:GrowHillDefaultMember 2024-10-01 2024-10-01 0001706524 us-gaap:SubsequentEventMember ugro:GrowHillDefaultMember 2025-10-14 2025-10-14 0001706524 ugro:JBrrothersSettlementMember 2025-08-08 0001706524 srt:MinimumMember 2025-08-08 2025-08-08 0001706524 srt:MaximumMember 2025-08-08 2025-08-08 0001706524 2025-06-27 0001706524 us-gaap:SubsequentEventMember 2025-10-31 2025-10-31 0001706524 2025-04-21 2025-04-21 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-07-01 2024-09-30 0001706524 ugro:CustomerOneMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-09-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-07-01 2024-09-30 0001706524 ugro:CustomerTwoMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-09-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-07-01 2024-09-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerThreeMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-09-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-07-01 2024-09-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerFourMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-09-30 0001706524 ugro:CustomerFiveMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerSixMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerSixMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerSevenMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerSevenMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-07-01 2024-09-30 0001706524 ugro:CustomerSevenMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerSevenMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-09-30 0001706524 ugro:CustomerEightMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2025-07-01 2025-09-30 0001706524 ugro:CustomerEightMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2024-07-01 2024-09-30 0001706524 ugro:CustomerOneMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerOneMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerTwoMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerTwoMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerThreeMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerThreeMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerFourMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerFourMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:CustomerFiveMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2025-01-01 2025-09-30 0001706524 ugro:CustomerFiveMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2024-01-01 2024-12-31 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2025-07-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2024-07-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2025-01-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2024-01-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2025-07-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2024-07-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2025-01-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierTwoMember 2024-01-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2025-07-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2024-07-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2025-01-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierThreeMember 2024-01-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2025-07-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2024-07-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2025-01-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFourMember 2024-01-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2025-07-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2024-07-01 2024-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2025-01-01 2025-09-30 0001706524 ugro:PurchasesMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierFiveMember 2024-01-01 2024-09-30 0001706524 us-gaap:AccountsPayableMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2025-01-01 2025-09-30 0001706524 us-gaap:AccountsPayableMember us-gaap:SupplierConcentrationRiskMember ugro:SupplierOneMember 2024-01-01 2024-12-31 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2025-07-01 2025-09-30 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2024-07-01 2024-09-30 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2025-01-01 2025-09-30 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2024-01-01 2024-09-30 0001706524 ugro:A2021OmnibusStockIncentivePlanMember 2025-01-01 2025-09-30 0001706524 srt:MinimumMember us-gaap:EmployeeStockOptionMember ugro:A2021OmnibusStockIncentivePlanMember 2025-01-01 2025-09-30 0001706524 srt:MaximumMember us-gaap:EmployeeStockOptionMember ugro:A2021OmnibusStockIncentivePlanMember 2025-01-01 2025-09-30 0001706524 us-gaap:RestrictedStockUnitsRSUMember 2025-09-30 0001706524 ugro:UnvestedStockOptionsMember 2025-09-30 0001706524 srt:ScenarioForecastMember us-gaap:TreasuryStockCommonMember 2026-02-09 2026-02-09 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2025-07-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2025-07-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2025-07-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember 2025-07-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2025-01-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2025-01-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2025-01-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember 2025-01-01 2025-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2024-07-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2024-07-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2024-07-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember 2024-07-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:EquipmentsMember 2024-01-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:ConstructionsMember 2024-01-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember ugro:CorporateOtherMember 2024-01-01 2024-09-30 0001706524 us-gaap:OperatingSegmentsMember 2024-01-01 2024-09-30 0001706524 2025-08-18 2025-08-18 0001706524 2025-02-24 2025-02-24 0001706524 2025-01-01 2025-06-30 0001706524 us-gaap:SubsequentEventMember 2025-10-14 2025-10-14 0001706524 us-gaap:CommonStockMember us-gaap:SubsequentEventMember 2025-10-14 0001706524 ugro:FlashSportsMediaHoldingsMember 2025-09-30 0001706524 srt:ScenarioForecastMember ugro:A2021OmnibusStockIncentivePlanMember us-gaap:CommonStockMember 2026-01-30 0001706524 srt:ScenarioForecastMember 2026-01-30 2026-01-30 0001706524 srt:ScenarioForecastMember ugro:A2021OmnibusStockIncentivePlanMember 2026-01-30 2026-01-30 0001706524 srt:ScenarioForecastMember ugro:A2021OmnibusStockIncentivePlanMember 2026-01-19 2026-01-19 0001706524 srt:ScenarioForecastMember ugro:A2021OmnibusStockIncentivePlanMember 2026-01-30 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2026-01-19 2026-01-19 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2026-01-19 0001706524 srt:ScenarioForecastMember ugro:PurchaseAndSubscriptionAgreementMember 2026-01-19 2026-01-19 0001706524 srt:ScenarioForecastMember ugro:PurchaseAndSubscriptionAgreementMember 2026-01-19 0001706524 srt:ScenarioForecastMember us-gaap:CommonStockMember 2026-02-04 2026-02-04 0001706524 srt:ScenarioForecastMember 2026-02-04 2026-02-04 0001706524 srt:ScenarioForecastMember us-gaap:WarrantMember us-gaap:CommonStockMember 2026-02-04 0001706524 srt:ScenarioForecastMember 2026-02-04 0001706524 ugro:DebtSettlementMember us-gaap:CommonStockMember 2025-07-01 2025-09-30 0001706524 us-gaap:CommonStockMember ugro:SettlementAgreementMember 2025-07-01 2025-09-30 xbrli:shares iso4217:USD iso4217:USD xbrli:shares xbrli:pure

Filing Compare · urban-gro, Inc.