UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

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

For the fiscal year ended December 31, ~~2024~~2025 Commission file number: 001-14332

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

NOVELSTEM INTERNATIONAL CORP.

(Exact name of registrant as specified in its charter)

Florida		65-0385686
State or other jurisdiction of		(I.R.S. Employer
incorporation or organization		Identification No.)
2255 Glades Road, Suite 221A, Boca Raton, FL		33431
7740 Cavern Lane Suite 100, Parkland FL		33067
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (410) 598-9024

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
None

Securities registered pursuant to section 12(g) of the Act:

Common Stock, par value $0.01 per share

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.

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 ~~Ex-~~Exchange ~~change~~ Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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

As of the last day of the second fiscal quarter of ~~2024~~2025, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately $31,~~282~~275,000 based on the closing sale price on that date as reported on the OTCQB marketplace. As of ~~April~~March 725, ~~2025~~2026, there were 4649,~~881~~332,~~475~~ 455 shares of Common Stock, $0.01 par value per share, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None

TABLE OF CONTENTS

		PAGE
PART I
Item 1.	BUSINESS	3
Item 1A.	RISK FACTORS	87
Item 1B.	UNRESOLVED STAFF COMMENTS	1210
Item 1C.	CYBERSECURITY	1210
Item 2.	PROPERTIES	1210
Item 3.	LEGAL PROCEEDINGS	1210
Item 4.	MINE SAFETY DISCLOSURES	1210
PART II
Item 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	1311
Item 6.	[RESERVED]	1311
Item 7.	MANAGEMEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	1411
Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	1716
Item 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	1716
Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	1716
Item 9A.	CONTROLS AND PROCEDURES	1817
Item 9B.	OTHER INFORMATION	1817
Item 9C.	DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS	1817
PART III
Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	1918
Item 11.	EXECUTIVE COMPENSATION	2120
Item 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	2423
Item 13.	CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE	2524
Item 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES	2625
PART IV
Item 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	2726
Item 16.	FORM 10-K SUMMARY	2927

Certain statements contained in this report are forward-looking in nature. These statements can be identified by the use of forward-looking terminology such as “believes”, “expects”, “may”, “will”, “should” or “anticipates”, or the negatives thereof, or comparable terminology, or by discussions of strategy. You are cautioned that our business and operations are subject to a variety of risks and uncertainties and, consequently, our actual results may materially differ from those projected by any forward-looking statements. Certain of such risks and uncertainties are discussed below under the heading “Item 1A. Risk Factors.”

PART I

Item 1. Business.

NovelStem International Corp. (“NovelStem” or the “Company”) is a holding company whose principal assets ~~are~~consisted of an approximate 31% equity interest in NewStem Ltd, an Israeli biotech company (“NewStem”) and its developed technology, and a 50% equity interest in NetCo Partners (“NetCo”). ~~and~~The aninterest ~~approximately~~in ~~31%~~NetCo ~~interest~~was sold in May 2025 in a noncash transaction which settled significant debt of the Company in the form of a litigation funding agreement. As described below, NewStem ~~Ltd~~was liquidated in October 2025. Currently, anthe ~~Israeli~~Company’s ~~biotech~~principal asset consists of rights to profits from a license held by Yissum Research Development Company, Hebrew University’s technology transfer company (“~~NewStem~~Yissum”)., which we previously held through our ownership interest in NewStem. NovelStem was formerly known as Hollywood Media Corp. The Company was incorporated in the State of Florida on January 22, 1993 and changed its name to NovelStem International Corp. in September 2018.

With the purchase of NewStem, an Israeli biotech company, in 2018 the Company expanded its business focus from media to cutting edge biotech. As a significant shareholder in NewStem, and the substantial commitment of our management and financial resources to NewStem, including the fact that our Executive Chairman, Jan Loeb, iswas also the Chairman of NewStem, we ~~have~~had the ability to exert significant influence over the management and operations of NewStem resulting in NewStem functioning as a minority operating subsidiary of the Company. ~~Since~~Concurrent to his appointment in July 2018, Mr. Loeb ~~has~~ acted in an executive capacity on behalf of the Company and has served in a de facto leadership role. In September 2022, the Board appointed Mr. Loeb as Executive Chairman of NovelStem in order to ratify Mr. Loeb’s position and clarify his executive role. On January 13, 2023, the Board appointed Mr. Loeb as President. With respect to NewStem, Mr. Loeb, as the Chairman, ~~calls~~presided ~~and presides~~ over the meetings of NewStem’s Board of Directors. Additionally, Mr. Loeb ~~leverages~~leveraged his financial expertise by guiding NewStem’s financial and strategic planning, including the raising and deployment of capital, developing and modifying NewStem’s business plan and budget and by participating in the negotiation of NewStem’s material contracts as required. NewStem ~~does~~did not ~~currently~~ have an appointed Chief Financial Officer and, as such, Mr. Loeb ~~serves~~served as the de facto Chief Financial Officer and Chief Strategic Officer of NewStem.

Through the second quarter of 2024, the Company was a development stage biotechnology holding company focused on the stem cell-based technology developed by Hebrew University under exclusive license to NewStem. The Company signed an agreement (the “Purchase Agreement”) on June 20, 2024 to acquire the remainder of NewStem in exchange for Company stock as well as funding for NewStem. The Company was unable to obtain funding to proceed, and the Purchase Agreement was not fully consummated. As such, no Company shares were issued to NewStem shareholders in exchange for NewStem shares.

During the third quarter of 2024, it became evident that NewStem would not be able to raise funds to continue operations consisting of research and development and further development of the technology. In October 2024, NewStem ceased operations and began the process of liquidation under which the current state of the technology ~~reverts~~reverted back to the original licensor, Yissum, with the Company retaining a financial ~~interest~~ interest of up to $3,750,000 in any future licensing. NewStem’s liquidation was completed in October 2025.

~~NovelStem~~Additionally, ~~depends~~NovelStem ~~entirely~~owned ona ~~earnings~~50% ~~and~~interest ~~cash~~in ~~from~~NetCo, ~~its~~a ~~investments~~joint inventure ~~NewStem~~that ~~and~~owns the ~~NewStem~~Net ~~technology~~Force ~~and~~publishing ~~our~~franchise. ~~50%~~On ~~equity~~May ~~interest~~9, in2025, the ~~NetCo joint venture. The~~ Company’s ~~principal~~entered into ~~operations~~a ~~coincided~~Settlement ~~with~~Agreement ~~those~~and ofRelease ~~NewStem.~~whereby Wethe ~~have~~investment ~~not~~in ~~received~~NetCo ~~any~~was ~~dividend~~sold ~~payments~~to ~~or other distributions from NewStem in~~ the ~~fiscal~~Company’s ~~years~~JV ~~ended~~partner ~~December~~for 31$1,300,000 ~~2024~~to settle ~~and~~the ~~2023.~~related Welitigation ~~received~~funding ~~distributions~~liability ofto ~~earnings~~Omni ~~from~~Bridgeway ~~NetCo of~~in ~~$6,875~~full. ~~during~~This ~~the~~transaction ~~fiscal~~was ~~year~~fully ~~ended~~consummated ~~December~~as ~~31,~~funds ~~2023.~~were Noreceived by ~~such~~Omni ~~distributions~~Bridgeway offrom ~~earnings~~CP ~~were~~Partners ~~received~~pursuant ~~during~~to the ~~fiscal~~terms ~~year~~of ~~ended December~~the ~~31, 2024~~agreement.

NovelStem depended entirely on earnings and cash from its investments in NewStem and the NewStem technology and our 50% equity interest in the NetCo joint venture. The Company’s principal operations coincided with those of NewStem. We have not received any dividend payments or other distributions from NewStem in the fiscal years ended December 31, 2025 and 2024. We received minimal distributions (approximately $600) of earnings from NetCo during the year ended December 31, 2025 and none during the year ended December 31, 2024.

NewStem is a development stage Israeli biotech limited liability company that performed research focused on human Pluripotent Stem Cells (hPSCs) in general, and Haploid human Pluripotent Stem Cells (HhPSCs), in particular. These cells have the potential to change the face of medical research as they play a pivotal role in cancer research, regenerative medicine and disease therapy. NewStem established a discovery bio-platform based on haploid human embryonic stem cell technology for genome-wide screenings and is currently using this platform for the discovery and development of oncology drugs based on synthetic lethal interaction and developing a personalized diagnostic for early detection of chemotherapy resistance. NewStem has incurred losses since inception and has generated minimal revenues from a licensing agreement to date. NewStem filed an FDA Pre-Submission and received a CE Mark from the European Medicines Agency (EMA) for its in vitro diagnostic device (IVDD). NewStem does not have an FDA approved medical device. The NewStem Software Diagnostic Device (NSDD) is CE marked under EU regulation as an “other” IVD under Directive 98/79/EC since March 2022.

NewStem performs genome-wide genetic screening to identify synthetic lethal interactions with common cancer-related mutations. The first step in the process is to create a model with relevant cancer-related mutations in HhPSCs, where, subsequently, a library targeting approximately 18,000 coding genes is induced. At the end of this step, each cell has two mutations, one in the cancer related gene and the other in a coding gene. A genome-wide genetic screening is performed, both on normal HhPSCs and genomic modified HhPSCs to which a cancer-related mutation was inserted. The goal of such screens is to identify mutations that in combination with a cancer-related mutation will kill the cells. Following bioinformatic analysis of the genetic screening results, novel targets are identified and validated, first in HhPSCs and then cancer models (tumor organoids and PDX). NewStem has validated several targets in HhPSCs and will move next to validation in cancer models. To identify novel targets for drug development, NewStem performs genome-wide genetic screening. The validation process requires additional experiments that corroborate the results in independent experiments that are performed on haploid human embryonic stem cells and cancer models. For validated targets, artificial intelligence (AI) based drug discovery will be performed following by hit to lead process and ADMET that will support the transition to clinical trials.

InNewStem ~~reference~~was toa ~~AI-based~~development ~~drug~~stage ~~discovery~~Israeli biotech limited liability company that performed research focused on human Pluripotent Stem Cells (hPSCs) in general, AIand ~~can~~Haploid ~~assist~~human Pluripotent Stem Cells (HhPSCs), in ~~structure~~particular. These cells have the potential to change the face of medical research as they play a pivotal role in cancer research, regenerative medicine and disease therapy. NewStem established a discovery bio-platform based ~~drug~~on ~~discovery~~haploid byhuman ~~predicting~~embryonic ~~the~~stem 3Dcell ~~protein~~technology ~~structure~~for genome-wide screenings and is currently using this platform for the discovery ~~chemical~~and ~~environment~~development of ~~the~~oncology ~~target~~drugs ~~protein~~based ~~site,~~on ~~thus~~synthetic ~~helping~~lethal tointeraction ~~predict~~and ~~the~~developing ~~effect~~a personalized diagnostic for early detection of chemotherapy resistance. NewStem incurred losses from inception and generated minimal revenues from a ~~compound~~licensing onagreement. NewStem filed an FDA Pre-Submission and received a CE Mark from the ~~target~~European ~~along~~Medicines ~~with~~Agency ~~safety~~(EMA) ~~considerations~~for its in vitro diagnostic device (IVDD). ~~before~~NewStem ~~their~~does ~~synthesis~~not orhave ~~production~~an ~~and,~~FDA ~~accordingly,~~approved ~~accelerates~~medical ~~the~~device. ~~drug~~The ~~development~~NewStem ~~process~~Software Diagnostic Device (NSDD) is CE marked under EU regulation as an “other” IVD under Directive 98/79/EC since March 2022.

InWe ~~reference~~believe tothat NewStem was the ~~hit~~only company worldwide to ~~lead~~develop ~~process-~~products based on this isinnovative proprietary technology. These products refer to the ~~iterative~~medical ~~process~~device ofplatform ~~lead~~that ~~improvement.~~provides Itinformation isto ~~the~~oncologists ~~stage~~regarding ~~where~~the apresence ~~hit,~~of ~~typically~~mutations ain ~~small~~the patient’s ~~molecule~~tumor ~~identified~~profile inwhich amay ~~high~~confer ~~throughput~~resistance ~~screen,~~to isdifferent ~~chemically~~anti-cancer ~~modified~~drugs ~~into~~and ato ~~lead~~anticancer ~~molecule~~drugs ~~following~~that ~~improvements~~target intumors ~~activity~~with ~~against~~specific mutations ~~the~~based ~~target~~on a synthetic-lethal interaction approach.

InNewStem’s ~~reference~~technology tosolutions ~~ADMET~~were derived from an exclusive, ~~this~~worldwide islicense ~~the~~from ~~five-letter~~Yissum ~~acronym~~and ~~for~~The ~~absorption,~~New ~~distribution,~~York ~~metabolism~~Stem Cells Foundation, ~~excretion~~based on the findings and inventions of Prof. Nissim Benvenisty, Director of the Azrieli Center for Stem Cells and ~~toxicity~~Genetic ~~that~~Research, ~~describes~~The Hebrew University ~~pharmacokinetics~~of Jerusalem (the “License”). ~~ADMET~~The ~~plays~~License ~~key~~provided ~~roles~~NewStem inwith ~~drug~~an ~~discovery~~exclusive worldwide license to make commercial use of the License and to develop, manufacture, market, distribute or sell a product in the field of therapeutics, diagnostics, screening, development and testing. AIn ~~high-quality~~consideration ~~drug~~for ~~candidate~~the ~~should~~grant ~~not~~of ~~only~~the ~~have~~License, ~~sufficient~~NewStem was obligated to pay royalties of up to 3% of net sales and up to ~~efficacy~~12% ~~against~~of “Sublicense Consideration” (as defined in the ~~therapeutic~~License ~~target~~Agreement). As part of the liquidation of NewStem, ~~but~~the ~~also~~License reverted ~~show~~to ~~appropriate~~the ~~ADMET~~original ~~properties~~holders atand NovelStem retained a ~~therapeutic~~significant ~~dose~~financial interest in any future monetization of the License.

~~NewStem~~ NovelStem ~~possesses~~was ~~pioneering~~the ~~intellectual~~original ~~property,~~seed ~~reagents~~investor in NewStem providing $2 million in July 2018 and ~~experience~~another ~~related~~$2 tomillion over the ~~isolation~~next two and ~~differentiation~~a half years. At the time of ~~HhPSCs~~liquidation, we owned a 30.51% equity interest in NewStem. The remaining equity interests in NewStem are owned by Yissum and ~~hPSCs~~Professor Benvenisty, ~~their~~ ~~genetic~~each ~~manipulation~~of whom owned a 30.51% equity interest, ~~immunogenicity~~Illumina Cambridge LTD, ~~tumorigenicity~~which owned a 5.31% equity interest, and management ~~their~~and ~~unique~~a ~~capacity~~number inof ~~disease~~other ~~modeling~~shareholders who owned collectively approximately 3.18%.

We believe that NewStem is the only company worldwide to develop products based on this innovative proprietary technology. These products refer to the medical device platform that provides information to oncologists regarding the presence of mutations in the patient’s tumor profile which may confer resistance to different anti-cancer drugs and to anticancer drugs that target tumors with specific mutations based on a synthetic-lethal interaction approach.

NewStem’s technology solutions are derived from an exclusive, worldwide license from Yissum Research Development Company, Hebrew University’s technology transfer company (“Yissum”) and The New York Stem Cells Foundation, based on the findings and inventions of Prof. Nissim Benvenisty, Director of the Azrieli Center for Stem Cells and Genetic Research, The Hebrew University of Jerusalem (the “License”). The License provided NewStem an exclusive worldwide license to make commercial use of the License and to develop, manufacture, market, distribute or sell a product in the field of therapeutics, diagnostics, screening, development and testing. In consideration for the grant of the License, NewStem was obligated to pay royalties of up to 3% of net sales and up to 12% of “Sublicense Consideration” (as defined in the License Agreement). As part of the ongoing liquidation of NewStem, the License reverts to the original holders and NovelStem retains a significant financial interest in any future monetization of the License.

NovelStem was the original seed investor in NewStem providing $2 million in July 2018 and another $2 million over the next two and a half years. We currently own a 30.51% equity interest in NewStem. The remaining equity interests in NewStem are owned by Yissum and Professor Benvenisty, each of whom owns a 30.51% equity interest, Illumina Cambridge LTD, which owns a 5.31% equity interest, and management and a number of other shareholders who own collectively approximately 3.18%. Currently, our President and Executive Chairman, Jan Loeb, is also the Chairman of the Board of NewStem. Professor Benvenisty and a representative of Yissum occupy the other two Board seats.

Competition

The technologies underlying future monetization of the License are subject to rapid and profound technological change. Competition intensifies as technical advances in each field are made and become more widely known. We can give no assurance that others will not develop services, products, or processes with significant advantages over the products, services, and processes that can be developed through the License. Any such occurrence could have a material and adverse effect on our business, results of operations and financial condition.

Yissum plans to find new users for the technology based on the License. The success of a future licensee to enhance and broaden its product offerings in response to changing customer demands and competitive pressure and technologies will depend on numerous factors, including the ability to:

-	Properly identify and anticipate physician and patient needs;
-	Develop and introduce new products or product enhancements in a timely manner;
-	Adequately protect intellectual property and avoid infringing upon the intellectual property rights of third parties;
-	Demonstrate the safety and efficacy of new products; and
-	Obtain the necessary regulatory clearances or approvals for new products or product enhancements.

Government Regulation

In the United States, pharmaceutical products are subject to extensive regulation by the Federal Food and Drug Administration and Cosmetic Act or the FDA. The FDA and other federal and state statutes and regulations, govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import and export of pharmaceutical products. The FDA has very broad enforcement authority and failure to abide by applicable regulatory requirements can result in administrative or judicial sanctions being imposed on NewStem, including warning letters, refusals of government contracts, clinical holds, civil penalties, injunctions, restitution, disgorgement of profits, recall or seizure of products, total or partial suspension of production or distribution, withdrawal of approval, refusal to approve pending applications, and criminal prosecution.

FDA Approval Process

NewStem’s therapeutic product candidates were expected to be regulated by the FDA as drugs, and it is expected that this would be applicable to any future licensee as well. No manufacturer may market a new drug until it has submitted a New Drug Application, or NDA, to the FDA, and the FDA has approved it.

The testing and approval process requires substantial time, effort and financial resources, and any future licensee’s product candidates may not be approved on a timely basis, if at all. The time and expense required to perform the clinical testing necessary to obtain FDA approval for regulated products can frequently exceed the time and expense of the research and development initially required to create the product. The results of preclinical studies and initial clinical trials of NewStem’s product candidates are not necessarily predictive of the results from large-scale clinical trials, and clinical trials may be subject to additional costs, delays or modifications due to a number of factors, including difficulty in obtaining enough patients, investigators or product candidate supply. Failure by any licensee to obtain, or any delay in obtaining, regulatory approvals or in complying with requirements could adversely affect the commercialization of product candidates and the Company’s ability to receive licensing revenues.

Other Regulatory Requirements

After approval, drug products are subject to extensive continuing regulation by the FDA, which include obligations to manufacture products in accordance with Good Manufacturing Practice, or GMP, maintain and provide to the FDA updated safety and efficacy information, report adverse experiences with the product, keep certain records and submit periodic reports, obtain FDA approval of certain manufacturing or labeling changes, and comply with FDA promotion and advertising requirements and restrictions. Failure by a licensee to meet these obligations can result in various adverse consequences, both voluntary and FDA-imposed, including product recalls, withdrawal of approval, restrictions on marketing, and the imposition of civil fines and criminal penalties against the NDA holder. In addition, later discovery of previously unknown safety or efficacy issues may result in restrictions on the product, manufacturer or NDA holder.

Outside the United States, a licensee’s ability to market a product is contingent upon receiving marketing authorization from the appropriate regulatory authorities. The requirements governing marketing authorization, pricing and reimbursement vary widely from jurisdiction to jurisdiction. At present, foreign marketing authorizations are applied for at a national level, although within the European Union registration procedures are available to companies wishing to market a product in more than one European Union member state.

NewStem is also subject to various environmental, health and safety regulations including those governing laboratory procedures and the handling, use, storage, treatment, and disposal of hazardous materials. From time to time, and in the future, NewStem’s operations may involve the use of hazardous materials.5

NetCo

In June 1995, we and C.P. Group Inc. (“C.P. Group”), formed the joint venture, NetCo. NetCo owns the entertainment property, “Net Force”, about a division of the FBI investigating crimes and adventures involving the internet and the digital world. NovelStem and C.P. Group each owned 50% of the ownership interest in NetCo. NetCo owns all rights in all media to the Net Force property including film, television, and video games.

~~NovelStem~~In ~~and~~1997, ~~C.P.~~NetCo ~~Group~~licensed ~~each~~the ~~own~~rights ~~50%~~to ofpublish the ~~ownership~~first ~~interest~~six Net Force books in ~~NetCo~~North America to Putnam Berkely, which books were written and published. ~~NetCo~~This ~~owns~~agreement ~~all~~was ~~rights~~subsequently renewed in ~~all~~December ~~media~~2001 for four more books that were created and published. There was also a series of books targeted to the young adult market, Net Force ~~property~~Explorer, ~~including~~also published by Putnam Berkley. Net Force books have ~~film,~~so ~~television,~~far ~~and~~been ~~video~~published ~~games~~in mass market paperback format. The first book in the series was adapted as a four-hour mini-series on the ABC television network.

In ~~1997~~2019, NetCo ~~licensed~~entered tointo ~~Putnam~~a ~~Berkley~~new ~~the~~publishing ~~rights~~agreement towith ~~publish~~HarperCollins. ~~the~~Three ~~first~~novels ~~six~~and two Net Force ~~books~~novellas ~~in North America, which books~~ were ~~written and~~ published. ~~This~~under that agreement. ~~was~~Through ~~subsequently~~its ~~renewed~~interest in ~~December~~NetCo, ~~2001~~NovelStem ~~for~~received ~~four~~distributions ~~more~~of ~~books~~its ~~that~~50% ~~were~~share ~~created and published. There was also a series~~ of ~~books~~proceeds ~~targeted~~generated tofrom the ~~young~~rights to ~~adult market,~~ Net Force ~~Explorer, also published by Putnam Berkley~~. ~~Net Force books have so far been published in mass market paperback format. The first book in the series was adapted as a four-hour mini-series on the ABC television network.~~

In ~~2019~~May 2025, ~~NetCo~~we ~~entered~~sold ~~into~~our ainterest ~~new~~in ~~publishing~~NetCo ~~agreement~~to ~~with~~our ~~HarperCollins.~~joint ~~Three~~venture ~~novels~~partner ~~and~~in ~~two~~exchange ~~Net~~for ~~Force~~the ~~novellas~~settlement ~~have~~of ~~been~~related ~~published~~debt ~~under that agreement. Through its interest~~ in ~~NetCo,~~the ~~NovelStem~~form ~~receives distributions~~ of ~~its 50% share of proceeds generated from the rights~~a tolitigation ~~Net~~funding ~~Force~~agreement.

At the time of this filing, the Company is in final negotiations to sell our interest in NetCo to our joint venture partner in exchange for the settlement of related debt in the form of a litigation funding agreement.

Competition

See Item 3 – Legal Proceedings for information concerning proceedings related to NetCo.

Employees

We do not currently have any employees; however, the Company relies on consultants to perform the duties that would be performed by employees.

Additional Financial Information

For additional financial information regarding our operations, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our Financial Statements included in this Annual Report.

Available Information

We file annual, quarterly and current reports and other information with the U.S. Securities and Exchange Commission (the “SEC”). These filings are available to the public over the internet at the SEC’s website at http://www.sec.gov. You may also read and copy any document we file at the SEC’s public reference room located at 100 F Street, NE, Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room.

Our website can be found at http://novelstem.com.

Item 1A. Risk Factors.

Our business is subject to certain risks, including those described below. If any of the events described in the following risk factors actually occurs then our business, results of operations and financial condition could be materially adversely affected. More detailed information concerning these risks is contained in other sections of this registration statement, including “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Risks Relating to our Business

We are a holding company, the principal assets of which are illiquid, ~~ownership~~rights ~~interests~~to ina ~~NetCo~~licensing ~~and NewStem~~agreement.

Our Company’s primary ~~assets~~asset ~~are~~is ~~equity interests in NetCo and NewStem, including~~ the residual value of relicensing the ~~license~~License formerly held by NewStem. ~~We are a 50% partner in NetCo. Our President and Executive Chairman, Jan Loeb, is also the Chairman of NewStem.~~

We conduct no other business and, as a result, we depend entirely upon earnings and cash flow from ~~NewStem~~the ~~and~~License ~~its~~held ~~technology~~by ~~and NetCo~~Yissum. If we decide in the future to pay dividends, as a holding company, our ability to pay dividends and meet other obligations depends ~~upon~~ upon the receipt of ~~dividends~~profits ~~or other payments~~ from ~~our~~this ~~operating~~license ~~subsidiaries~~agreement.

Our investments in NewStem and NetCo are illiquid.

Our shares in NewStem and its technology and our ownership interest in NetCo are illiquid and have extremely limited liquidity rights. The transferability of these interests is restricted under federal and state securities laws and the governing documents of each of NewStem and NetCo.

We depend on our executive officers and consultants and other key individuals along with the executive officers and key individuals of NewStem to continue the implementation of our long-term business strategy and could be harmed by the loss of their services and our inability to make up for such loss with qualified replacements.

We believe that our ~~continued growth and~~ future success will depend in large part on the skills of our management team and the management ~~teams~~ team of ~~NewStem,~~Yissum ~~including~~related to subsequent monetization of the License ~~and NetCo, and our partners’ respective abilities to motivate and retain these individuals and other key individuals~~. The loss of any of ~~their~~the ~~service~~key individuals’ services could reduce our ability to successfully ~~implement~~ implement our long-term business strategy which may result in a loss of revenue, and the value of our common stock could be materially ~~adversely~~ adversely affected. Leadership changes will occur from time to time, and we cannot predict whether significant resignations will occur ~~or whether NewStem will be able to recruit additional qualified personnel~~. We believe these management teams possess valuable knowledge about our~~, NewStem’s~~ and ~~NetCo~~former NewStem’s respective industries and that their knowledge and relationships would be very difficult to replicate. The loss of key personnel, or the inability to recruit and retain qualified and talented personnel in the future, could have an adverse effect on ~~the respective businesses of NewStem and NetCo, and, consequently,~~ our business, financial condition and/or operating results.

We ~~and NewStem~~ have limited operating histories and have generated minimal revenue to date.

We ~~and NewStem~~ have a limited operating history and do not have a meaningful historical record of sales and revenues, nor do we ~~or NewStem~~ have an established business track record. While we believe that we have the opportunity to be successful, there can be no assurance that we will be successful in accomplishing our business initiatives, or that we will be able to achieve any significant levels of ~~revenues~~ revenue or net income.

We have identified material weaknesses in our internal control and procedures and internal control over financial reporting. If not remediated, our failure to establish and maintain effective disclosure controls and procedures and internal control over financial reporting could result in material misstatements in our financial statements and a failure to meet our reporting and financial obligations, each of which could have a material adverse effect on our financial condition and the trading price of our common stock.

Maintaining effective internal control over financial reporting and effective disclosure controls and procedures are necessary for us to produce reliable financial statements. We have re-evaluated our internal control over financial reporting and our disclosure controls and procedures and concluded that they were not effective as of December 31, ~~2024~~2025 and we concluded there was a material weakness in the design of our internal control over financial reporting.

A material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

Rapid technological change could cause ~~products~~the License to become obsolete~~, and if NewStem does not enhance its product offerings through research and development efforts, it may be unable to effectively compete~~.

Success from NewStem’s efforts will depend upon ~~Yissum’s~~the ability of Yissum to relicense the technology supported by the License.

The technologies underlying NewStem’s products and the license technology are subject to rapid and profound technological change. Competition intensifies as technical advances in each field are made and become more widely known. We can give no assurance that others will not develop services, products, or processes with significant advantages over the products, services, and processes that ~~has~~have developed. ~~Any~~ Any such occurrence could have a material and adverse effect on our business, results of operations and financial condition.

-	Properly identify and anticipate physician and patient needs;
-	Develop and introduce new products or product enhancements in a timely manner;
-	Adequately protect intellectual property and avoid infringing upon the intellectual property rights of third parties;
-	Demonstrate the safety and efficacy of new products; and
-	Obtain the necessary regulatory clearances or approvals for new products or product enhancements.

The value of our investment in NetCo and our ability to receive distributions may be affected by disputes between the Company and C.P. Group, our partner in NetCo.

The Company and C.P. Group each hold a 50% interest in NetCo. The joint venture agreement governing NetCo provides for mutual decision making among the Company and C.P. Group generally (subject to exceptions) and arbitration in the event any controversy or disagreement arises. The Company and C.P. Group were previously in arbitration as to ongoing scope and the operation of NetCo. This arbitration was concluded in July 2023. The arbitrator ruled against the Company on certain key issues of the arbitration and in the Company’s favor on two key issues of the arbitration. However, if we are unable proceed in the sale of our interest in NetCo to our Joint Venture partner or the successful utilization of the joint venture assets in a manner favorable to the Company, our investment in NetCo and our ability to continue to receive distributions from our interest in NetCo could have an adverse effect on our business, financial condition or operating results.

NetCo’s business is intensely competitive and “hit” driven. NetCo may not deliver “hit” products and services, or consumers may prefer a competitors’ products or services over NetCo.

Competition in the publishing and video game industries is intense. Many new products and services are regularly introduced in each major industry segment (console, mobile and PC), but only a relatively small number of “hit” titles account for a significant portion of total revenue in each segment. NetCo’s competitors range from established interactive entertainment companies and diversified media companies to emerging start-ups, and we expect new competitors to continue to emerge throughout the world. If NetCo’s competitors develop and market more successful and engaging products or services, offer competitive products or services at lower price points, or if NetCo does not develop high-quality, well-received and engaging products and services, NetCo and our revenue, margins, and profitability will decline.

If NetCo fails to develop relationships with new creative talent, its business could be adversely affected.

NetCo’s business, in particular the trade publishing and media portions of the business, is highly dependent on maintaining strong relationships with the authors, illustrators and other creative talent who produce the products and services that are sold to its customers. Any overall weakening of these relationships, or the failure to develop successful new relationships, could have an adverse impact on NetCo and the Company’s business and financial performance.

Risks relating to our common stock

Because our holding company structure creates restrictions on the payment of dividends, our ability to pay dividends is limited.

We are a holding company whose primary ~~assets~~asset ~~are~~is our ~~ownership~~right ofto ~~equity~~income ~~interests~~from inthe ~~NewStem and NetCo~~License. We currently conduct no other business and, as a result, we depend entirely upon ~~NewStem’s~~cash ~~and~~flow ~~NetCo’s~~from ~~earnings~~the ~~and cash flow~~License. If we decide in the future to pay dividends, as a holding company, our ability to pay dividends and meet other obligations depends upon the receipt of ~~dividends~~cash orflow ~~other payments~~ from ~~NewStem or NetCo. NewStem and/or NetCo may be restricted in their ability to pay dividends, make distributions or otherwise transfer funds to us prior to~~ the satisfaction of other obligations, including the payment of operating expenses or debt service, appropriation to reserves prescribed by laws and regulations, covering losses in previous years, restrictions on the conversion of local currency into ULicense.S. ~~dollars or other hard currency, completion of relevant procedures with governmental authorities or banks and other regulatory restrictions.~~ We do not presently have any intention to declare or pay dividends in the future. You should not purchase shares of our common stock in anticipation of receiving dividends in future periods.

Because we do not intend to pay any cash dividends on our common stock, our shareholders will not be able to receive a return on their shares unless they sell them.

We intend to retain any future earnings to reduce debt. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. Unless we pay dividends, our shareholders will not be able to receive a return on their shares unless they sell them. Shareholders may never be able to sell shares when desired. Before you invest in our securities, you should be aware that there are various risks. You should consider carefully these risk factors, together with all of the other information included in this annual report before you decide to purchase our securities. If any of the following risks and uncertainties develop into actual events, our business, financial condition or results of operations could be materially adversely affected.

108

Reporting requirement under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and compliance with the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), including establishing and maintaining acceptable internal controls over financial reporting, are costly and may increase substantially.

The rules and regulations of the SEC require a public company to prepare and file periodic reports under the Exchange Act, which require that the Company engage legal, accounting, auditing and other professional services. The engagement of such services is costly. Additionally, the Sarbanes-Oxley Act requires, among other things, that we design, implement and maintain adequate internal controls and procedures over financial reporting. The costs of complying with the Sarbanes-Oxley Act and the limited technically qualified personnel we have may make it difficult for us to design, implement and maintain adequate internal controls over financial reporting. In the event that we fail to maintain an effective system of internal controls or discover material weaknesses in our internal controls, we may not be able to produce reliable financial reports or report fraud, which may harm our overall financial condition and result in loss of investor confidence and a decline in our share price.

We are working with our legal, accounting and financial advisors to identify those areas in which changes should be made to our financial and management control systems to manage our growth and our obligations as a public company. These areas include corporate governance, corporate control, disclosure controls and procedures and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas. However, we anticipate that the expenses that will be required in order to adequately prepare for being a public company could be material. We estimate that the aggregate cost of increased legal services; accounting and audit functions; consultants to design and implement internal controls; and financial printing alone will be a few hundred thousand dollars per year and could be several hundred thousand dollars per year. In addition, we may incur additional expenses related to director compensation and/or premiums for directors’ and officers’ liability insurance, the costs of which we cannot estimate at this time. We may also incur additional expenses associated with investor relations and similar functions, the cost of which we also cannot estimate at this time. However, these additional expenses individually, or in the aggregate, may also be material.

The continued increased costs associated with operating as a public company may decrease our net income or increase our net loss and may cause us to reduce costs in other areas of our business. Additionally, if these requirements divert our management’s attention from other business concerns, they could have a material adverse effect on our business, financial condition and results of operations.

There is a very limited trading market for our common stock and investors are not assured of the opportunity to sell their stock, should they desire to do so.

Our common stock is currently quoted on the OTC Pink Market. However, our stock has traded in very limited quantities in the past. We believe a significant factor in the limited market is our limited capitalization and liquidity, results of operations and the characterization of our stock as a “penny stock.” We hope to remedy our financial condition and results of operation in the future. This, in turn, may assist us in obtaining listing of our stock on other exchanges. However, there is no assurance that any of these objectives will be met or that the market will ever increase to a point where investors could sell their stock at a desirable price, should they desire to do so.

The price of our common stock could be highly volatile.

Our shares of common stock are quoted on the OTC Pink Market. It is likely that our common stock will be subject to price volatility, low volumes of trades and large spreads in bid and ask prices quoted by market makers. Due to the low volume of shares traded on any trading day, persons buying or selling in relatively small quantities may easily influence prices of our common stock. This low volume of trades could also cause the price of our stock to fluctuate greatly, with large percentage changes in price occurring in any trading day session. Holders of our common stock may also not be able to readily liquidate their investment or may be forced to sell at depressed prices due to low volume trading. If high spreads between the bid and ask prices of our common stock exist at the time of a purchase, the stock would have to appreciate substantially on a relative percentage basis for an investor to recoup their investment. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of our common stock. No assurance can be given that an active market in our common stock will be sustained. If an active market does not continue, holders of our common stock may be unable to readily sell the shares they hold or may not be able to sell their shares at all.

119

We may be deemed an investment company, which could impose on us burdensome compliance requirements.

The Investment Company Act of 1940, as amended (the “Investment Company Act”), requires companies to register as an investment company if they are engaged primarily in the business of investing, reinvesting, owning, holding, or trading securities. Generally, companies may be deemed investment companies under the Investment Company Act if they are viewed as engaging in the business of investing in securities or they own investment securities having a value exceeding 40% of certain assets. We are not in the business of investing, reinvesting, owning, holding or trading securities. However, if the Securities and Exchange Commission deems us to be an investment company, we may have imposed upon us additional burdensome requirements, including having to register as an investment company, adopting a specific form of corporation structure and having to comply with certain reporting, record keeping, voting, proxy, and disclosure requirements. Such additional requirements would require us to incur additional costs and have an adverse effect on our results of operations and our ability to effectively carry out our business plan.

Item 1B. Unresolved Staff Comments.

None

Item 1C. Cybersecurity

Risk Management and Strategy

We ~~focus~~ focus on a comprehensive approach to identifying, preventing, and mitigating cybersecurity threats and incidents, as such term is defined in in Item 106(a) of Regulation S-K, and have integrated these processes into our overall risk management systems and processes.

As the Company has no operations and no employees, we have no operating procedures related to cybersecurity. We do design and monitor reasonable ~~technical~~ technical safeguards to minimize any identified risks with our financial reporting.

Our ~~risk~~ risk management strategy also considers cybersecurity risks associated with the use of our third-party vendors and service providers.

Governance

Our Board of Directors oversees our cybersecurity risk management as part of its general oversight and management is responsible for the day-to-day management of material cybersecurity risks.

Item 2. Properties.

Our corporate office is located at ~~2255~~7740 ~~Glades~~Cavern ~~Road~~Lane, ~~Boca~~Parkland ~~Raton,~~ FL ~~33431~~33067. We believe that our facilities are adequate for current operations.

Item 3. Legal Proceedings.

As noted above, NetCo owns all rights to the “Tom Clancy’s Net Force” intellectual property in all media, including film, television, and video games. As part of the joint venture, NetCo has published more than a dozen books and had an ABC miniseries.None

~~After~~Item ~~Tom Clancy passed away in 2013, his estate and business partners refused to cooperate in exploiting the intellectual property~~4. ~~After trying~~Mine toSafety ~~amicably resolve the dispute, the Company initiated arbitration proceedings with the American Arbitration Association~~Disclosures. The Company’s arbitration demand asserts claims for breach of the joint venture agreement and breach of fiduciary duty. Both claims arise from C.P. Group’s failure to make reasonable, good faith efforts to exploit the full array of media rights relating to Net Force. The Company’s goal is to maximize the total potential value of the NetCo intellectual property across video games, streaming, digital media, merchandising and other ancillary markets. The Company believes that the value of the intellectual property is significant.

~~The~~Not arbitration evidentiary hearing concluded on October 20, 2022, and the arbitrator ordered the parties to submit post-hearing briefs. Final briefs were filed in January 2023. The Arbitrator ruled in the Company’s favor on two key issues of the arbitration and ruled against the Company in other key issues.applicable

The Arbitrator ruled in NovelStem’s favor on the issue of contract interpretation of the Netco Partners JV Agreement. The Arbitrator also found that the Company’s joint venture partner failed to use “reasonable, good faith efforts” to license and exploit the Net Force concept, in breach of its contractual obligations under the Netco Partners’ Joint Venture Agreement. The Arbitrator confirmed NovelStem’s contractual right to use Tom Clancy’s name as a possessory credit in the Net Force title (Tom Clancy’s Net Force). However, the arbitrator did not award any damages to the Company and did not cede operating control of the joint venture to the Company as requested. As such, the Company continues to struggle to maximize the potential of the NetCo asset.10

ToPART fund efforts to maximize the value of NetCo, NovelStem has secured non-recourse litigation funding. As a result of this ruling, costs of approximately $2.900,000 related to the litigation funding agreement were recognized during the year ended December 31, 2023. II

~~Item~~[See 4.General ~~Mine~~Instruction ~~Safety Disclosures.~~G2]

~~Not~~Item ~~applicable~~5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

12Market information

~~PART~~There IIis no established public trading market in our common stock, and a regular trading market may not develop, or if developed, may not be sustained. Our securities are currently quoted on the OTC Markets Pink under the symbol “NSTM”. The following reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

[See General Instruction G2]

	High		Low

Fiscal 2025
Quarter ended 12/31/2025	$	0.012	$	0.009
Quarter ended 9/30/2025	$	0.028	$	0.028
Quarter ended 6/30/2025	$	0.027	$	0.023
Quarter ended 3/31/2025	$	0.01	$	0.008

Fiscal 2024
Quarter ended 12/31/2024	$	0.04	$	0.01
Quarter ended 9/30/2024	$	0.07	$	0.04
Quarter ended 6/30/2024	$	0.07	$	0.06
Quarter ended 3/31/2024	$	0.08	$	0.06

~~Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.~~Holders

~~Market~~As ~~information~~of March 25, 2026 there were 49,332,455 shares of common stock outstanding held by approximately 80 record holders.

There is no established public trading market in our common stock, and a regular trading market may not develop, or if developed, may not be sustained. Our securities are currently quoted on the OTC Markets Pink under the symbol “NSTM”. The following reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.Dividends

	High		Low
Fiscal 2025
Quarter ended 3/31/2025	$	0.01	$	0.01
Fiscal 2024
Quarter ended 12/31/2024	$	0.04	$	0.01
Quarter ended 9/30/2024	$	0.07	$	0.04
Quarter ended 6/30/2024	$	0.07	$	0.06
Quarter ended 3/31/2024	$	0.08	$	0.06
Fiscal 2023
Quarter ended 12/31/2023	$	0.18	$	0.06
Quarter ended 9/30/2023	$	0.25	$	0.13
Quarter ended 6/30/2023	$	0.28	$	0.14
Quarter ended 3/31/2023	$	0.20	$	0.15
Fiscal 2022
Quarter ended 12/31/2022	$	0.21	$	0.11
Quarter ended 9/30/2022	$	0.28	$	0.12
Quarter ended 6/30/2022	$	0.33	$	0.06
Quarter ended 3/31/2022	$	0.30	$	0.13
Fiscal 2021
Quarter ended 12/31/2021	$	0.31	$	0.20
Quarter ended 9/30/2021	$	0.35	$	0.19
Quarter ended 6/30/2021	$	0.35	$	0.23
Quarter ended 3/31/2021	$	0.30	$	0.16
Fiscal 2020
Quarter ended 12/31/2020	$	0.20	$	0.05
Quarter ended 9/30/2020	$	0.09	$	0.05
Quarter ended 6/30/2020	$	0.13	$	0.07
Quarter ended 3/31/2020	$	0.13	$	0.08

We have not paid cash dividends on any of our capital stock since our name change and business focus shift in 2018 and currently intend to retain our future earnings, if any, to reduce debt and fund the development and growth of our business. We do not expect to pay any dividends on any of our capital stock in the foreseeable future.

~~Holders~~Item 6. [Reserved]

AsItem ~~of April~~ 7,. ~~2025~~Management’s ~~there~~Discussion ~~were~~and ~~46,881,475~~Analysis ~~shares~~ of ~~common~~Financial ~~stock~~Condition ~~outstanding~~and ~~held~~Results byof ~~approximately 80 record holders~~Operations.

~~Dividends~~The following discussion includes statements that are forward-looking in nature. Whether such statements ultimately prove to be accurate depends on a variety of factors that may affect our business and operations. Certain of these factors are discussed in “Item 1A. Risk Factors.”

WeThe ~~have~~following ~~not~~discussion ~~paid cash dividends on any~~ of our ~~capital~~financial ~~stock~~condition ~~since~~and ~~our~~results ~~name~~of ~~change~~operations ~~and~~should ~~business~~be ~~focus~~read ~~shift~~ in ~~2018~~conjunction ~~and~~with ~~currently intend to retain~~ our ~~future~~financial ~~earnings,~~statements and ifthe ~~any,~~related tonotes ~~fund~~thereto ~~the development~~ and ~~growth~~other offinancial ~~our~~information ~~business.~~appearing Weelsewhere ~~do not expect to pay any dividends on any of our capital stock~~ in ~~the~~this ~~foreseeable future~~report.

~~Item 6. [Reserved]~~Overview

13We are a development stage company and reported net income (losses) of approximately $2,380,000 and $(3,233,000) for the years ended December 31, 2025 and 2024, respectively. We had current assets of approximately $16,000 and current liabilities of approximately $2,157,000 as of December 31, 2025. As of December 31, 2024, our current assets and current liabilities were approximately $32,000 and $5,304,000, respectively. We have prepared our financial statements for the years ended December 31, 2025 and 2024 assuming that we will continue as a going concern. Our continuation as a going concern is dependent upon improving our profitability and the continuing financial support from our shareholders as well as Yissum’s ability to successfully commercialize the License. Our sources of capital in the past have included the sale of equity securities, which include common stock sold in private transactions, and short-term debt. During the current year, we entered into a bridge loan agreement with our Executive Chairman to obtain funding for current operating expenses.

~~Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.~~11

~~The~~Critical ~~following~~Accounting discussion includes statements that are forward-looking in nature. Whether such statements ultimately prove to be accurate depends on a variety of factors that may affect our business and operations. Certain of these factors are discussed in “Item 1A. Risk Factors.”Policies

The ~~following~~SEC ~~discussion~~defines of“critical ~~our~~accounting ~~financial~~policies” ~~condition~~as ~~and~~those ~~results~~that require application of ~~operations~~management’s ~~should~~most bedifficult, ~~read~~subjective or incomplex ~~conjunction~~judgements, ~~with~~often ~~our~~as ~~financial~~a ~~statements and~~result of the ~~related~~need ~~notes~~to ~~thereto~~make ~~and~~estimates ~~other~~about ~~financial~~the ~~information~~effect ~~appearing~~of ~~elsewhere~~matters that are inherently uncertain and my change in ~~this~~subsequent ~~report~~periods.

~~Overview~~The following discussion of critical accounting policies represents our attempt to report on these accounting policies which we believe are critical to our financial statements and other financial disclosures. It is not intended to be a comprehensive list of all of our significant accounting policies, which are more fully described in Note 2 of the Notes to the Financial Statements included in this Annual Report.

We are a development stage company and reported net losses of approximately $3,233,000 and $4,187,000 for the years ended December 31, 2024 and 2023, respectively. We had current assets of approximately $32,000 and current liabilities of approximately $5,304,000 as of December 31, 2024. As of December 31, 2023, our current assets and current liabilities were approximately $87,000 and $346,000, respectively. We have ~~prepared~~identified our ~~financial~~accounting ~~statements~~policies for the years ended December 31, 2024 and 2023 assuming that we will continue as a going concern. Our continuation as a going concern is dependent upon improving our profitability and the continuing financial support from our shareholders as well as Yissum’s ability to successfully commercialize the License. Our sources of capital in the past have included the sale of equity securities, which include common stock ~~sold in private transactions, and short~~-~~term~~based ~~debt.~~compensation ~~During the current year, we continued to borrow on existing finance agreements with two related party individuals~~ and aaccounting ~~shareholder~~for toderivative ~~fund~~liabilities ~~current~~as ~~operating~~critical ~~expenses. Additionally,~~accounting ~~we entered into two convertible debt instruments to fund advances to NewStem~~policies.

~~NewStem~~We isrecognize astock-based ~~development~~compensation ~~stage~~expense ~~Israeli~~based ~~biotech~~on ~~limited~~the ~~liability~~fair ~~company~~value ~~focused~~recognition onprovision ~~pioneering~~of ~~intellectual~~applicable ~~property~~accounting ~~related~~principles, tousing ~~haploid human~~the ~~embryonic~~Black-Scholes ~~stem~~option ~~cells~~valuation ~~for~~method. Accordingly, we are required to measure the ~~development~~cost of ~~personalized~~services ~~diagnostics~~received ~~and~~in ~~therapeutics~~exchange for ~~genetic~~an ~~and~~award of ~~epigenetic~~equity ~~diseases.~~instruments ~~NewStem~~based ~~has incurred~~on ~~losses~~the ~~related~~grant-date tofair invalue ~~process~~of ~~research~~the award and ~~development~~to ~~since~~recognize ~~inception~~that ~~and~~cost over the ~~Company~~period ~~records~~during ~~our~~which ~~percentage~~services are ~~allocation~~provided ofin ~~these net~~exchange ~~losses~~for asthe ~~incurred~~award. InUnder ~~many~~the ~~cases~~Black-Scholes method, ~~the~~we ~~accounting~~make ~~treatment~~assumptions ofwith arespect ~~particular~~to ~~transaction~~the isexpected ~~specifically~~lives ~~dictated~~of bythe options ~~generally~~that ~~accepted accounting~~have ~~principles,~~been ~~with~~granted noand ~~need~~are ~~for~~outstanding, ~~management’s~~the ~~judgement~~expected involatility, ~~their~~the ~~application.~~dividend ~~There~~yield ~~are~~percentage ~~also~~of ~~areas~~our incommon ~~which~~stock ~~the~~and ~~selection~~the ofrisk-free aninterest ~~available~~rate ~~alternative~~at ~~policy~~the ~~would~~respective ~~not~~dates ~~produce~~of ~~a materially different result~~grant.

~~Critical~~The ~~Accounting~~Company ~~Policies~~did not grant any options during the year ended December 31, 2025. The expected volatility factor used to value stock options granted in 2024 was based on the historical volatility of the market price of our common stock over the period from our change to a biotechnology company, September 2018, through December 2024. For the expected term of the option, we used an estimate of the expected option life based on historical experience. The risk-free interest rate used is based upon U.S. Treasury yields for a period consistent with the expected term of the options. We assumed no quarterly dividend rate. Due to the numerous assumptions involved in calculating stock-based compensation expense, the expense recognized in our financial statements may differ significantly from the value realized by option holders on exercise of the share-based instruments. In accordance with the prescribed methodology, we do not adjust our recognized compensation expense to reflect these differences.

~~The~~For ~~SEC~~the ~~defines~~years ~~“critical~~ended ~~accounting~~December ~~policies” as those that require application of management’s most difficult~~31, ~~subjective or~~2025 ~~complex~~and ~~judgements~~2024, ~~often~~we asincurred astock ~~result~~compensation ofexpense ~~the~~with ~~need~~respect to ~~make~~options ~~estimates about the effect~~ of ~~matters~~approximately ~~that~~$8,800 ~~are inherently uncertain~~ and my$40,000, ~~change in subsequent periods~~respectively.

~~The~~See ~~following~~Note ~~discussion~~5 ~~of critical accounting policies represents our attempt~~ to ~~report~~the ~~on these accounting policies which we believe are critical to our~~ financial statements ~~and~~for ~~other~~the ~~financial~~assumptions ~~disclosure.~~used ~~It is not intended~~ to becalculate athe ~~comprehensive~~fair ~~list~~value of ~~all~~stock-based ~~of our significant accounting policies, which are more fully described in Note 2 of the Notes to the Financial Statements included in this Annual Report~~compensation.

WeIn ~~have~~accordance with Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging, we identify and, if applicable, bifurcate embedded derivatives in financial instruments. Those embedded features that are identified, ~~our~~bifurcated ~~accounting~~and ~~policies~~accounted for ~~stock-based~~separately are ~~compensation~~measured ~~and~~at ~~accounting~~fair value continuously at each financial statement reporting date. If the fair value of a financial liability (the derivative) exceeds the proceeds received for the issuance of a hybrid instrument in an arm’s length transaction with no rights or privileges that require separate accounting recognition as an asset identified, then we record the embedded derivative ~~liabilities~~at fair value with the excess of fair value over proceeds recognized as ~~critical~~a ~~accounting~~loss in earnings. Our only identified derivative was terminated as part of the amendment of a note payable to a shareholder during ~~policies~~the year ended December 31, 2025.

WeResults ~~recognize stock-based compensation expense based on the fair value recognition provision~~ of applicable accounting principles, using the Black-Scholes option valuation method. Accordingly, we are required to measure the cost of services received in exchange for an award of equity instruments based on the grant-date fair value of the award and to recognize that cost over the period during which services are provided in exchange for the award. Under the Black-Scholes method, we make assumptions with respect to the expected lives of the options that have been granted and are outstanding, the expected volatility, the dividend yield percentage of our common stock and the risk-free interest rate at the respective dates of grant.Operations

The ~~expected~~selected ~~volatility~~statement ~~factor used to value stock options in 2024 was based on the historical volatility~~ of ~~the~~operations ~~market~~data ~~price~~for ~~of our common stock over~~ the ~~period~~years ~~from~~ended ~~our~~December ~~change to a biotechnology company~~31, ~~September~~2025 ~~2018,~~and ~~through December~~ 2024. ~~For~~and ~~the~~balance ~~expected~~sheet ~~term~~data ofas ~~the option, we used an estimate~~ of ~~the~~December ~~expected~~31, ~~option~~2025 ~~life based on historical experience. The risk-free interest rate used is based upon~~and ~~U.S.~~2024 ~~Treasury~~have ~~yields~~been ~~for~~derived afrom period consistent with the expected term of the options. We assumed no quarterly dividend rate. Due to the numerous assumptions involved in calculating stock-based compensation expense, the expense recognized in our audited financial statements ~~may differ~~included ~~significantly~~in ~~from~~this ~~the~~Annual ~~value realized by option holders on exercise of the share-based instruments~~Report. ~~In accordance with the prescribed methodology, we do not adjust our recognized compensation expense to reflect these differences.~~

~~For~~This ~~the~~data ~~years~~should ~~ended~~be ~~December~~read ~~31,~~in ~~2024~~conjunction ~~and 2023, we incurred stock compensation expense~~ with ~~respect~~our tofinancial ~~options~~statements and ~~warrants~~related ofnotes ~~approximately $40,000~~included ~~and $303,000, respectively~~herein.

~~See Note 5 to the financial statements for the assumptions used to calculate the fair value of stock-based compensation.~~12

InSelected ~~accordance~~Statement with Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging, we identify and, if applicable, bifurcate embedded derivatives in financial instrument instruments. Those embedded features that are identified, bifurcated and accounted for separately are measured at fair value continuously at each financial statement reporting date. If the fair value of ~~a financial~~Operations liability (the derivative) exceeds the proceeds received for the issuance of a hybrid instrument in an arm’s length transaction with no rights or privileges that require separate accounting recognition as an asset identified, then we record the embedded derivative at fair value with the excess of fair value over proceeds recognized as a loss in earnings.Data:

	Years Ended December 31,
	2025			2024			Change
Administrative fee income	$	-		$	12,000		$	(12,000	)
Operating expenses:
G&A expenses	$	238,755		$	880,947		$	(642,192	)
Litigation expenses (contra expenses)		-			58,975			(58,975	)
Total operating expenses		238,755			939,922			(701,167	)
Loss from operations		(238,755	)		(927,922	)		689,167
Other (income) expenses:
Loss on derivative instrument		-			90,000			(90,000	)
Gain on disposal of equity method investment		(1,171,760	)		-			(1,171,760	)
Relief of indebtedness income		(1,697,024	)		-			(1,697,024	)
Interest expense		256,219			425,417			(169,198	)
Total other (income) expenses		(2,612,565	)		515,417			(3,127,982	)
Net income (loss) before equity in net income (loss) of equity method investees		2,373,810			(1,443,339	)		3,817,149
Equity in net income (loss) of equity method investees		640			(161,046	)		161,686
Impairment loss on equity method investee		5,432			(1,628,657	)		1,634,089
Net income (loss)	$	2,379,882		$	(3,233,042	)	$	5,612,924

~~Results~~2025 ofCompared ~~Operations.~~to 2024

~~The~~We ~~selected~~are ~~statement~~a ofholding ~~operations~~company ~~data~~whose ~~for~~primary asset currently is our right to the ~~years~~monetization ~~ended~~of ~~December~~the ~~31,~~former ~~2024~~NewStem ~~and~~license ~~2023~~now ~~and~~held ~~balance~~by ~~sheet~~Yissum. We ~~data~~currently conduct no other business and as a result, we have no operating revenue or cost of ~~December~~revenue. ~~31,~~We ~~2024~~did ~~and 2023~~charge ~~has~~annual ~~been~~administrative fees ~~derived~~to ~~from~~an ~~our~~affiliated ~~audited~~entity ~~financial~~through ~~statements~~the ~~included~~year inended ~~this~~December ~~Annual~~31, ~~Report~~2024.

~~This~~The ~~data~~Company ~~should~~incurs begeneral ~~read~~and administrative (“G&A”) expenses primarily related to professional fees, insurance and stock-based compensation. We incurred G&A expenses of approximately $239,000 and $881,000 for the years ended December 31, 2025 and 2024, respectively. Our decrease in ~~conjunction~~G&A ~~with~~expenses relates primarily to decreases in bad debt expense, stock-based compensation and professional fees incurred in the audit of our financial statements for the years ended December 31, 2025 and 2024, preparation of our quarterly reports for 2025 and 2024, and for documents and advice related ~~notes~~to ~~included~~our ~~herein~~attempt to purchase the remaining shares of NewStem in 2024.

~~Selected~~Specifically, ~~Statement~~we wrote off as bad debt uncollected management fees of ~~Operations~~$9,500 ~~Data:~~during the year ended December 31, 2025 as compared to the net balance due from NewStem of $458,000 in the year ended December 31, 2024, and professional fees decreased by approximately $145,000 in the year ended December 31, 2025 as compared to the year ended December 31, 2024. Insurance costs decreased by approximately $17,000 in the year ended December 31, 2025 as compared to the year ended December 31, 2024.

	Years Ended December 31,
	2024			2023			Change
Administrative fee income	$	12,000		$	12,000		$	-
Operating expenses:
G&A expenses	$	880,947		$	665,277		$	215,670
Litigation expenses		58,975			2,872,522			(2,813,547	)
Total operating expenses		939,922			3,537,799			(2,597,877	)
Loss from operations		(927,922	)		(3,525,799	)		2,597,877
Other expenses:
Loss on derivative instrument		90,000			260,000			(170,000	)
Impairment loss on equity method investee		1,628,657			-			1,628,657
Interest expense		425,417			99,023			326,394
Total other expenses		2,144,074			359,023			1,785,051
Net loss before equity in net loss of equity method investees		(3,071,996	)		(3,884,822	)		812,826
Equity in net loss of equity method investees		(161,046	)		(338,618	)		177,572
Gain on dilution of equity method investment		-			36,139			(36,139	)
Net loss	$	(3,233,042	)	$	(4,187,301	)	$	954,259

Total stock compensation expense, included in G&A expenses, decreased by approximately $31,000 in the year ended December 31, 2025 as compared to the year ended December 31, 2024 due to the fact that no options were awarded during the current fiscal year.

~~2024~~The ~~Compared~~remaining decrease in G&A expenses of approximately $700 during the year ended December 31, 2025 consists primarily of decreases in expenses related to ~~2023~~investor relations and information technology.

We ~~are~~incurred acosts ~~holding~~related ~~company~~to ~~whose~~litigation ~~primary assets are our ownership of equity interests in NetCo~~ and ~~NewStem including~~ the ~~technology~~related oflitigation ~~NewStem. We~~funding ~~conduct~~agreement noinvolving ~~other~~our ~~business~~former ~~and~~settled asarbitration awith ~~result,~~our weNetCo joint ~~have~~venture nopartner ~~operating revenue or cost~~ of ~~revenue.~~approximately We$59,000 doduring ~~charge~~the ~~annual~~year ~~administrative~~ended ~~fees to~~December an31, ~~affiliated entity~~2024.

The Company incurs general and administrative (“G&A”) expenses primarily related to professional fees, insurance and stock based compensation. We incurred G&A expenses of approximately $881,000 and $665,000 for the years ended December 31, 2024 and 2023, respectively. Our increase in G&A expenses relates primarily to bad debt incurred with the write off of notes receivable from NewStem, stock-based compensation and professional fees incurred in the audit of our financial statements for the years ended December 31, 2024 and 2023, preparation of our quarterly reports for 2024 and 2023, and for documents and advice related to our attempt to purchase the remaining shares of NewStem.13

~~Specifically,~~The weCompany ~~wrote~~has ~~off~~recorded asa ~~bad~~loss ~~debt~~on ~~the~~derivative ~~net~~instruments ~~balance due from NewStem~~ of $~~458~~90,000, infor the year ended December 31, 2024, ~~and~~related ~~professional~~to ~~fees~~a ~~increased~~guarantee previously byincluded ~~approximately $40,000~~ in the ~~year~~note ~~ended~~payable ~~December~~shareholder ~~31,~~entered ~~2024~~into asin ~~compared~~May to2023. ~~the~~The ~~year~~guarantee ~~ended~~was ~~December~~removed ~~31,~~in ~~2023.~~an ~~Insurance~~amendment ~~costs~~to ~~decreased by~~the ~~approximately~~note ~~$14,000~~payable in during the year ended December 31, 2024, asterminating ~~compared to~~ the ~~year ended December 31, 2023~~derivative.

~~Total~~The ~~stock~~Company ~~compensation~~reported ~~expense,~~a ~~included~~gain inon ~~G&A~~disposal ~~expenses,~~of ~~decreased~~equity bymethod investment of approximately $~~263~~1,172,000 induring the year ended December 31, ~~2024~~2025 asrelated ~~compared~~ to the ~~year~~sale ~~ended December 31, 2023 due to a smaller number~~ of ~~options~~our ~~awarded~~investment in ~~the~~NetCo. ~~current~~We ~~period~~also asreported ~~compared~~relief toof ~~the~~indebtedness ~~prior period~~income ~~as well as by the recognition~~ of approximately $~~243~~1,697,000 ~~in stock compensation expense in the year ended December 31, 2023~~ related to the ~~increased~~cancellation ~~value~~ of ~~our~~the ~~outstanding~~remaining ~~warrants~~balance ~~due~~on to the ~~amendment~~litigation offunding ~~the~~agreement ~~agreements~~from ~~to extend~~ the ~~due~~same ~~date by two years~~transaction.

The ~~remaining~~Company ~~decrease~~recorded inan ~~G&A~~impairment ~~expenses~~loss of approximately $51,629,000 during the year ended December 31, 2024 ~~consists~~related ~~primarily~~to its investment in NewStem. This loss reduced our investment in NewStem to zero ($0.00) as of ~~Decreases~~December 31, 2024. This adjustment was made in response to the fact that NewStem ceased operations and was in ~~expenses~~the ~~related~~process of liquidation. The technology and license held by NewStem reverted to the ~~investor~~original ~~relations~~licensee, Yissum, and ~~information~~the Company retains a right to a share of future licensing or monetization of the technology and license. The Company does expect to recover some value from the license, up to a total of $3,750,000, however, as of December 31, 2025 and 2024, the realization of this value is not certain, therefore has not been recorded by the Company. During the year ended December 31, 2025, the Company received approximately $5,000 from the liquidation of the remaining assets of NewStem which was reported as a partial recovery of the impairment loss.

WeInterest ~~incurred~~expense ~~costs~~decreased ~~related~~by ~~to litigation and the related litigation funding agreement involving our arbitration with our NetCo joint venture partner of~~ approximately $59169,000 ~~and~~in ~~$2,873,000,~~the ~~respectively,~~year ~~for years~~ ended December 31, ~~2024~~2025 ~~and~~as ~~2023.~~compared ~~Specifically,~~to the ~~decrease of approximately $2,814,000 for the~~ year ended December 31, 2024. asThe decrease ~~compared~~in tointerest ~~2023~~expense is ~~comprised~~primarily ~~of legal fees~~ related to ~~our~~the ~~NetCo arbitration~~reduction ~~including~~of ~~litigation~~interest ~~funding~~from ~~fees~~the ~~due~~settlement toof ~~Omni Bridgeway pursuant to~~ the litigation funding agreement ~~incurred in the year~~ ~~ended~~offset ~~December~~by ~~31,~~increased ~~2023~~debt ~~as compared to a lower amount~~ incurred infor ~~the year ended December 31, 2024 related to final expenses not funded by Omni Bridgeway~~operations.

15The Company has recorded no income tax expense as we have incurred operating losses and all deferred tax assets are fully offset by an income tax valuation allowance.

~~The~~We ~~Company~~reported ~~has~~net ~~recorded~~income aand ~~loss~~losses onfrom ~~derivative~~equity ~~instrument~~method ofinvestees ~~$90,000~~during ~~and $260,000, respectively, for~~ the years ended December 31, ~~2024~~2025 and ~~2023~~ ~~related~~2024. toThe anet ~~guarantee~~income ~~included~~reported for in the ~~note~~year ~~payable~~ended ~~shareholder~~December ~~entered~~31, ~~into~~2025 inincluded ~~May~~net ~~2023~~income of $640 from NetCo. ~~The~~Net ~~loss~~losses ~~recorded~~reported infor the year ended December 31, 2024 included ~~brings~~net ~~the~~loss ~~derivative~~of ~~instrument~~approximately to$5,000 ~~its~~from ~~highest~~NetCo ~~contractual~~combined ~~liability~~with net loss of approximately $156,000 from NewStem.

~~The~~Liquidity Company has recorded an impairment loss of approximately $1,629,000 during the year ended December 31, 2024 related to its investment in NewStem. This loss reduces our investment in NewStem to zero ($0.00) as of December 31, 2024. This adjustment was made in response to the fact that NewStem ceased operations and isCapital in the process of liquidation. The technology and license held by NewStem reverted to the original licensee, Yissum, and the Company retains a right to a share of future licensing or monetization of the technology and license. The Company does expect to recover some value from the license, however, as of December 31, 2024, the realization of this value is not certain, therefore has not been recorded by the Company. No such adjustment was made during the year ended December 31, 2023.Resources

~~Interest~~We ~~expense~~have ~~increased~~not bypaid ~~approximately~~dividends ~~$326,000~~on inour ~~the~~common ~~year~~stock ~~ended~~since ~~December~~our ~~31,~~name ~~2024~~change asand ~~compared~~business tofocus ~~the~~shift ~~year~~in ~~ended~~2018. ~~December~~Our ~~31,~~present ~~2023.~~policy ~~The increases~~is into ~~interest~~apply ~~expense~~cash to ~~are~~investments ~~related~~in toproduct ~~increased~~development ~~debt~~at ~~incurred~~NewStem, ~~for~~acquisitions ~~operations~~or expansion; consequently, ~~the~~we ~~accrual~~do ofnot ~~interest~~expect onto ~~the~~pay ~~litigation~~dividends ~~funding~~on common ~~agreement~~stock ~~and~~in the ~~funding~~foreseeable ~~of NewStem~~future.

The Company ~~has~~will ~~recorded~~need noto ~~income~~obtain ~~tax~~additional ~~expense~~funds asto wecontinue ~~have~~its ~~incurred~~operations. ~~operating~~Management’s ~~losses~~plans ~~and~~with ~~all~~regard ~~deferred~~to ~~tax~~these ~~assets~~matters ~~are~~include fundraising ~~fully~~until ~~offset~~our byinterest anin ~~income~~NewStem’s technology via monetization of the License is profitable. Although management continues ~~tax~~to ~~valuation~~pursue ~~allowance~~these plans, there is no assurance that the Company will be successful in obtaining sufficient cash from financing on terms acceptable to the Company, or that NewStem’s technology will be monetized and become profitable.

WeDuring ~~reported~~the ~~net~~year ~~losses~~ended ~~from~~December ~~equity~~31, ~~method~~2022, ~~investees~~the ~~during~~Company ~~the~~entered ~~years~~into ~~ended~~note ~~December~~agreements 31with Jan Loeb, ~~2024~~our ~~and~~Executive ~~2023.~~Chairman ~~The~~and ~~net~~Jerry ~~losses~~Wolasky, ~~reported~~a member ~~for~~of the ~~year ended~~Board, ~~December~~to ~~31,~~borrow ~~2024~~up ~~included~~to ~~net~~an ~~loss~~aggregate of ~~approximately~~ $5600,000 ~~from~~for ~~NetCo~~working ~~combined~~capital ~~with~~needs. ~~net~~The ~~loss~~note ofagreements ~~approximately~~were amended in March 2024 to increase the total borrowing to $~~156~~650,000 ~~from~~and ~~NewStem~~extend the maturity date. ~~Net~~ ~~losses~~The ~~reported~~note agreements were refinanced in August 2024 providing for total borrowings of $750,000 and extending the ~~year~~maturity ~~ended~~date to December 31, ~~2023~~2025. ~~included~~The ~~net~~agreements ~~income~~provide offor ~~approximately~~interest ~~$3,000~~at ~~from~~a ~~NetCo~~rate of ~~which~~10% ~~was~~per ~~offset~~annum. byPrior ~~net loss~~to the filing of ~~approximately~~this ~~$342~~Annual Report,~~000~~ ~~from~~the ~~NewStem~~maturity date of these notes was extended to June 30, 2026.

WeDuring ~~reported~~the year ended December 31, 2023, the Company entered into a ~~gain~~note agreement with a shareholder to borrow $300,000 for continued working capital. This note bore interest at zero percent (0%) and matured on ~~dilution~~May of5, ~~our~~2025. ~~equity~~The ~~method~~note ~~investment~~included ~~related~~a toguarantee ~~stock~~which ~~issuances~~has ~~made~~been toidentified as ~~third~~an ~~parties~~embedded byderivative ~~NewStem~~with a fair value of ~~approximately~~ a liability of $36650,000 ~~during~~at December 31, 2024. This note was amended in May 2025 to provide for fixed interest, remove the ~~year~~guarantee ~~ended~~and ~~December~~extend 31the maturity date to September 30, ~~2023~~2025. WeThis ~~incurred~~note nowas ~~such~~amended ~~gain~~for ora ~~loss~~second ~~during~~time in October 2025 to extend the ~~year~~maturity ~~ended~~date to December 31, ~~2024~~ 2026.

~~Liquidity and Capital Resources~~14

WeIn ~~have~~December ~~not~~2023, ~~paid~~the ~~dividends~~Company onentered ~~our~~into ~~common~~two ~~stock~~short ~~since~~term ~~our~~notes ~~name~~payable ~~change~~with ~~and~~unrelated ~~business~~parties ~~focus~~for ~~shift~~a total of $250,000 in ~~2018~~borrowings utilized for the funding of NewStem. ~~Our~~The ~~present~~notes ~~policy~~bear isinterest toat ~~apply~~12% ~~cash~~per annum and matured December 21, 2025, at which time all principal and accrued interest were due and payable. Prior to ~~investments~~the infiling ~~product~~of ~~development~~this atAnnual ~~NewStem~~Report, ~~acquisitions~~the ormaturity ~~expansion;~~date ~~consequently,~~of wethese donotes ~~not~~was ~~expect~~extended to ~~pay~~June ~~dividends~~30, on2026. The ~~common~~note agreements include a provision whereby, in the event of a capital raise transaction by the Company, the note holders would be ~~stock~~entitled to participate in the ~~foreseeable~~transaction ~~future~~in an amount equal to 133% of the amounts owed on the note agreements at the closing of the transaction.

~~The~~In ~~Company~~April ~~will~~2024, ~~need~~the toCompany ~~obtain~~borrowed ~~additional~~$100,000 ~~funds~~from tounrelated ~~continue~~parties ~~its~~pursuant ~~operations.~~to ~~Management’s~~convertible ~~plans~~debt ~~with~~agreements ~~regard~~accounted tofor ~~these~~as ~~matters~~debt. ~~include~~These ~~the~~agreements ~~potential~~bear ~~sale of our~~ interest inat ~~NetCo~~10% toper ~~settle~~annum ~~our liability related to the litigation funding agreement~~ and ~~additional~~matured ~~financing and~~December ~~fundraising~~30, ~~until our interest in NewStem’s technology is profitable~~2025. ~~Although~~Prior ~~management continues~~ to ~~pursue~~the ~~these~~filing ~~plans, there~~of isthis noAnnual ~~assurance~~Report, ~~that~~ the ~~Company~~maturity ~~will~~dates have bebeen ~~successful~~extended ~~in obtaining sufficient cash from financing on terms acceptable~~ to ~~the~~June ~~Company~~30, or ~~that NewStem’s technology will be monetized and become profitable~~2026.

During the year ended December 31, ~~2022~~2025, the Company ~~entered~~borrowed ~~into note agreements with Jan Loeb~~$161,867 ~~our~~from the Executive Chairman ~~and~~in ~~Jerry~~the ~~Wolasky,~~form ~~a member~~ of ~~the~~an ~~Board,~~interim tobridge ~~borrow~~loan upuntil alternate tofunding ansources ~~aggregate~~can ofbe ~~$600,000 for working capital needs~~found. The ~~note~~Company ~~agreements~~is ~~were~~accruing ~~amended~~interest inat ~~March~~10% ~~2024 to~~per ~~increase~~annum ~~the~~for ~~total~~these ~~borrowing to $650,000 and extend the maturity date~~advances. The ~~agreements~~agreement ~~provide~~matured ~~for~~December 31, ~~interest at a rate of 10% per annum~~2025. As ofPrior to the ~~date~~filing of this Annual Report, the ~~full~~maturity ~~amount~~date ~~of $650,000~~ has been ~~funded~~extended ~~pursuant~~ to ~~these~~June ~~agreements~~30, 2026.

~~During~~On ~~the~~May ~~year ended December 31~~9, ~~2023,~~2025 the Company ~~entered~~sold ~~into~~its ainterest ~~note~~in ~~agreement~~NetCo ~~with~~to aits ~~shareholder~~JV topartner ~~borrow~~for $1,300,000 ~~for~~which ~~continued~~was ~~working capital.~~paid ~~This~~directly ~~note~~to ~~bears~~Omni ~~interest~~Bridgeway atin ~~zero percent (0%) and matures on May 5, 2025. The note includes a guarantee which has been identified~~full assettlement anof ~~embedded~~all ~~derivative~~liabilities ~~with~~related ato ~~fair~~the ~~value~~litigation offunding aagreement ~~liability~~totaling of $~~650~~2,~~000 and $535~~959,~~000 at December 31, 2024 and 2023, respectively~~625.

InNet ~~December~~Cash ~~2023,~~Used ~~the~~In ~~Company~~Operating ~~entered into two short term notes payable with unrelated parties for a total of $250,000 in borrowings utilized for the funding of NewStem~~Activities. The notes bear interest at 12% per annum and matured December 21, 2024, at which time all principal and accrued interest are due and payable. Prior to the filing of this Annual Report, the maturity date of these notes was extended to December 21, 2025. The note agreements include a provision whereby, in the event of a capital raise transaction by the Company, the note holders would be entitled to participate in the transaction in an amount equal to 133% of the amounts owed on the note agreements at the closing of the transaction.

InFor ~~April~~the ~~2024~~year ended December 31, ~~the~~2025, ~~Company~~net ~~borrowed~~cash used in operating activities was approximately $~~100~~168,000, which consisted primarily of a net income of approximately $2,380,000 reduced by noncash gain of approximately $1,172,000 from ~~unrelated~~the ~~parties~~sale ~~pursuant~~of our interest in NetCo and the related noncash relief of indebtedness income from the settlement of the litigation funding agreement with Omni Bridgeway of $1,697,000, stock-based compensation of approximately $9,000. Further offset by accretion of discount on notes payable of $60,000 and interest added to notes payable and convertible debt ~~agreements~~of ~~accounted~~approximately ~~for~~$194,000. asAdditionally, ~~debt~~cash was used in operations related to an increase in current assets of approximately $10,000 and an increase in accrued liabilities and other payables of approximately $48,000.

~~Net~~For ~~Cash~~the ~~Used~~year Inended ~~Operating~~December ~~Activities~~31, 2024, net cash used in operating activities was approximately $272,000, which consisted primarily of a net loss of approximately $3,233,000, offset by noncash equity in loss of equity method investees of approximately $161,000, impairment of equity method investees of approximately $1,629,000, bad debt expense of $500,000, and stock-based compensation of approximately $40,000. Further offset by loss on derivative instrument of $90,000, accretion of discount on notes payable of $178,000 and interest added to notes payable and convertible debt of approximately $215,000. Additionally, cash was used in operations related to an increase in current assets of approximately $8,000 and an increase in accrued liabilities and other payables of approximately $140,000.

For the year ended December 31, 2024, net cash used in operating activities was approximately $272,000, which consisted primarily of a net loss of approximately $3,233,000, offset by noncash equity in loss of equity method investees of approximately $161,000, impairment of equity method investees of approximately $1,629,000, bad debt expense of $500,000, and stock-based compensation of approximately $40,000. Further offset by loss on derivative instrument of $90,000, accretion of discount on notes payable of $178,000 and interest added to notes payable and convertible debt of approximately $215,000. Additionally, cash was used in operations related to an increase in current assets of approximately $8,000 and an increase in accrued liabilities and other payables of approximately $140,000.15

~~For~~Net ~~the~~Cash ~~year~~Used ~~ended~~In ~~December~~Investing 31, 2023, net cash used in operating activities was approximately $348,000, which consisted primarily of a net loss of approximately $4,187,000, offset by noncash equity in loss of equity method investees of approximately $339,000 and distributions from equity method investees of $7,000, netted with gain on dilution of approximately $36,000 and stock-based compensation of approximately $303,000Activities. Further offset by approximately $2,819,000 in cumulative noncash litigation expenses funded directly by the litigation funding agreement, loss on derivative instrument of $260,000, accretion of discount on notes payable of $62,000 and interest added to related party notes payable of $35,138. Additionally, cash was used in operations related to a decrease in current assets of approximately $19,000 and an increase in accrued liabilities and other payables of approximately $31,000.

16During the year ended December 31, 2024, the Company loaned $250,000 to NewStem in anticipation of a purchase transaction. This transaction was not consummated and NewStem ceased operations and began liquidation proceedings in October 2024, resulting in the loan becoming uncollectible. As such, the Company determined the note was uncollectible and wrote the balance, including $250,000 loaned in 2023, off as a bad debt during the year ended December 31, 2024.

Net Cash ~~Used~~Provided InBy ~~Investing~~Financing Activities.

~~During~~For the ~~years~~year ended December 31, ~~2024 and 2023~~2025, ~~the~~net ~~Company~~cash ~~loaned~~provided aby ~~total~~financing ofactivities was $~~500~~161,~~000~~867, consisting of ~~$250,000~~advances ~~per~~on ~~year to NewStem in anticipation of a purchase transaction. This transaction was not consummated and NewStem ceased operations and began liquidation proceedings in October 2024, resulting in~~ the bridge loan ~~becoming uncollectible. As such, the Company determined the note was uncollectible and wrote the balance~~payable ~~off~~to asour aExecutive ~~bad debt during the year ended December 31, 2024~~Chairman.

~~Net~~For ~~Cash~~the ~~Provided~~year Byended ~~Financing~~December ~~Activities~~31, 2024, net cash provided by financing activities was $475,000, consisting of long-term borrowings from two directors and a stockholder totaling $375,000 and borrowings from convertible debt with unrelated parties of $100,000.

~~For the year ended December 31, 2024, net cash provided by financing activities was $475,000, consisting of long~~Off-~~term borrowings from two~~Balance ~~directors~~Sheet ~~and a stockholder totaling $375,000 and borrowings from convertible debt with unrelated parties of $100,000.~~Arrangements

~~For~~We ~~the~~are ~~year~~not ~~ended~~party ~~December~~to ~~31,~~any ~~2023, net cash provided by financing activities was $645,000, consisting of long~~off-~~term~~balance ~~borrowings~~sheet ~~from two directors and a stockholder totaling $395,000 and short term borrowings from unrelated parties of $250,000~~transactions.

~~Off-Balance~~Contractual ~~Sheet~~Obligations ~~Arrangements~~and Commercial Commitments

WeAs ~~are~~of ~~not~~December ~~party~~31, to2025, ~~any~~we ~~off-balance~~had ~~sheet transactions. With the exception of~~ a ~~guarantee~~contractual obligation related to ~~long~~our ~~term~~directors’ ~~borrowings~~and ~~from~~officers’ ainsurance ~~stockholder which~~providing ~~is accounted~~ for as10 monthly ainstallments ~~derivative~~of $5,109 wepayable ~~have~~through noJune ~~guarantees or obligations other than those which arise out of normal business operations~~2026.

~~Contractual~~As ~~Obligations~~of December 31, 2024, we had a contractual obligation related to our directors’ and ~~Commercial~~officers’ ~~Commitments~~insurance providing for 10 monthly installments of $5,127 payable through June 2025.

AsItem of7A. ~~December~~Quantitative ~~31, 2024, we had a contractual obligation related to our directors’~~ and ~~officers’~~Qualitative ~~insurance~~Disclosures ~~providing~~About ~~for~~Market ~~10 monthly installments of $5,127 payable through June 2025~~Risk.

AsThis ofsection ~~December~~is ~~31,~~not ~~2023, we had a contractual obligation related to our directors’ and officers’ insurance providing for 10 monthly installments of $4,943 payable through June 2024~~applicable.

Item 7A8. ~~Quantitative~~Financial Statements and ~~Qualitative~~Supplementary ~~Disclosures About Market Risk~~Data.

~~This~~Furnished ~~section~~at isthe ~~not~~end ~~applicable~~of this Annual Report, commencing on page F-1.

Item 89. ~~Financial~~Changes ~~Statements~~in and ~~Supplementary~~Disagreements ~~Data~~With Accountants on Accounting and Financial Disclosure.

~~Furnished at the end of this Annual Report, commencing on page F-1~~None.

~~Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.~~16

~~None~~Item 9A. Controls and Procedures.

17Our Principal Executive Officer and Chief Financial Officer conducted an evaluation of our controls and procedures. We have identified material weaknesses in our internal control and procedures and internal control over financial reporting. If not remediated, our failure to establish and maintain effective disclosure controls and procedures and internal control over financial reporting could result in material misstatements in our financial statements and a failure to meet our reporting and financial obligations, each of which could have a material adverse effect on our financial condition and the trading price of our common stock.

~~Item~~Maintaining 9Aeffective internal control over financial reporting and effective disclosure controls and procedures are necessary for us to produce reliable financial statements. ~~Controls~~We have re-evaluated our internal control over financial reporting and ~~Procedures~~our disclosure controls and procedures and concluded that they were not effective as of December 31, 2025 and we concluded there was a material weakness in the design of our internal control over financial reporting as it relates to insufficient resources to employ proper segregation of duties over the processing of transactions and financial reporting.

~~Our~~A ~~Principal~~material ~~Executive~~weakness ~~Officer~~is ~~and~~defined ~~Chief~~as ~~Financial~~a ~~Officer~~deficiency, ~~conducted~~or ana ~~evaluation~~combination of ~~our~~deficiencies, ~~controls and procedures. We have identified material weaknesses~~ in ~~our~~ internal control ~~and procedures and internal control~~ over financial reporting. Ifsuch ~~not remediated, our failure to establish~~that ~~and~~there ~~maintain~~is ~~effective~~a ~~disclosure~~reasonable ~~controls~~possibility ~~and~~that ~~procedures~~a ~~and~~material ~~internal~~misstatement ~~control~~of ~~over~~our ~~financial~~annual ~~reporting~~or ~~could~~interim ~~result in material misstatements in our~~ financial statements ~~and~~will anot ~~failure~~be toprevented ~~meet our reporting and financial obligations, each of which could have a material adverse~~or ~~effect~~detected on ~~our~~a ~~financial~~timely ~~condition and the trading price of our common stock~~basis.

~~Maintaining~~Remediation effective internal control over financial reporting and effective disclosure controls and procedures are necessary for us to produce reliable financial statements. We have re-evaluated our internal control over financial reporting and our disclosure controls and procedures and concluded that they were not effective as of December 31, 2024 and we concluded there was a material weakness in the design of our internal control over financial reporting as it relates to insufficient resources to employ proper segregation of duties over the processing of transactions and financial reporting.Actions

AManagement ~~material~~continues ~~weakness~~to isfocus ~~defined~~on asstrengthening athe ~~deficiency,~~Company’s orinternal acontrols ~~combination~~within ofthe ~~deficiencies,~~parameters inof ~~internal~~what ~~control~~can ~~over~~be ~~financial~~done ~~reporting~~with ~~such~~limited ~~that~~resources. ~~there~~As isresources apermit, ~~reasonable~~management ~~possibility~~will ~~that~~continue ato ~~material~~attempt ~~misstatement~~to ofbuild ~~our~~the ~~annual~~necessary orcapabilities ~~interim~~and infrastructure to implement corrective action. At the current time, financial ~~statements~~resources ~~will~~are ~~not~~limited bethereby ~~prevented~~impeding ~~or detected~~the onability aof ~~timely~~management ~~basis~~to employ personnel to provide proper separation of duties.

~~Remediation~~Changes ~~Actions~~in Internal Control Over Financial Reporting

~~Management~~There ~~continues~~was tono ~~focus~~change onin ~~strengthening~~our ~~the Company’s~~ internal ~~controls~~control ~~within~~over ~~the~~financial ~~parameters~~reporting of(as ~~what~~such ~~can~~term beis ~~done~~defined ~~with~~in ~~limited~~Rule ~~resources. As~~13a-15(f) ~~resources~~under ~~permit,~~the ~~management~~Exchange ~~will~~Act) ~~continue to attempt to build~~ during the ~~necessary~~period ~~capabilities~~covered ~~and~~by ~~infrastructure~~this toreport ~~implement~~that ~~corrective action.~~has Atmaterially ~~the current time~~affected, ~~financial~~or ~~resources~~is ~~are~~reasonably ~~limited~~likely ~~thereby~~to ~~impeding~~materially ~~the~~affect, ~~ability~~our ofinternal ~~management~~control ~~to employ personnel to provide~~over ~~proper~~financial ~~separation of duties~~reporting.

~~Changes~~Item in9B. ~~Internal~~Other ~~Control Over Financial Reporting~~Information.

There was no change in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.None

Item 9B9C. ~~Other~~Disclosure ~~Information~~Regarding Foreign Jurisdictions that Prevent Inspections.

~~None~~Not applicable.

~~Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.~~17

~~Not~~PART ~~applicable.~~III

18Item 10. Directors, Executive Officers and Corporate Governance.

~~PART~~Biographical ~~III~~and certain other information concerning the Company’s officers and directors is set forth below. There are no familial relationships among any of our officers or directors. Except as indicated below, none of our directors is a director in any other reporting companies. None of our officers or directors has been affiliated with any company that has filed for bankruptcy within the last ten years. We are not aware of any proceedings to which any of our officers or directors, or any associate of any such officer or director is a party adverse to us or any of our subsidiaries or has a material interest adverse to us or any of our subsidiaries. Unless otherwise indicated, there are no arrangements or understandings between any officer and any other person pursuant to which such person was selected as an officer.

~~Item 10~~Jan Loeb – President and Executive Chairman – 67 Mr. ~~Directors~~Loeb has more than forty years of business, money management and investment banking experience. He has served as Chairman of our Board since July 2018 and on September 29, 2022 was appointed as Executive ~~Officers~~Chairman. On January 13, 2023, Mr. Loeb was appointed President of the Company. He has been the Managing Member of Leap Tide Capital Management LLC since 2007 and has served as President and CEO of Acorn Energy, Inc. since January 2016 and as a Director since August 2015. He has been a Director of Keweenaw Land Association, Ltd. From 2005 to 2007, Mr. Loeb was President of Leap Tide’s predecessor, formerly known as AmTrust Capital Management Inc. He served as a Portfolio Manager of Chesapeake Partners from February 2004 to January 2005 and as Managing Director at Jefferies & Company, Inc. from 2002 to 2004. From 1994 to 2001, he served as Managing Director at Dresdner Kleinwort Wasserstein, Inc. (formerly Wasserstein Perella & Co., Inc.). Mr. Loeb was a Lead Director of American Pacific Corporation from 2013 to 2014 and a Director from 1997 to 2014. He also served as an Independent Director of Pernix Therapeutics Holdings Inc. (formerly, Golf Trust of America, Inc.) from 2006 to 2011 and as a Director of TAT Technologies, Ltd. from 2009 to 2016. Christine Jenkins – Vice President and Chief Financial Officer – 62 Ms. Jenkins has over thirty-six years of experience in public accounting, including audit, consulting and corporate tax. Ms. Jenkins is currently serving as a consultant providing audit and accounting consultation to publicly-traded and large privately held companies. From 2010 to 2018 Ms. Jenkins was an audit partner with Cherry Bekaert, LLP. Prior to Cherry Bekaert, from 1995 to 2010, Ms. Jenkins was a partner in a local accounting firm in Atlanta, GA. Prior experience included audit and tax positions in public accounting firms. Mitchell Rubenstein – Director – 71 Mr. Rubenstein co-founded and served as Chairman of HMC from its inception to June 2018, during which period the company returned approximately $37 million to shareholders in the form of dividends and share repurchases, including a tender offer. He founded Syfy Channel and numerous other media and digital businesses. Eric Richman – Director -64 Mr. Richman is a life science executive with significant leadership, operational and strategic experience from over twenty-five years in the field. He is currently The CEO of Gain Therapeutics and was a Venture Partner at Brace Pharma Capital and serves on the boards of LabConnect, F2G (board observer) and previously ADMA Biologics (NASDAQ: ADMA). Previously he served as President & CEO of PharmAthene and prior to that was part of the founding team at MedImmune, responsible for the U.S. launch of its first commercial product and an integral part of the global launch teams for other products. He began his career at HealthCare Ventures, a life-sciences focused VC firm and formerly was a Director of Lev Pharmaceuticals (sold to Viropharma) and American Bank (sold to Congressional Bancshares) and served as CEO of Tyrogenex (sold to Betta Pharma). David Seltzer – Director – 65 Mr. Seltzer is the CEO and Founder of Reliable 1 Laboratories LLC, a distributor of OTC medications and nutritional supplements to independent pharmacies, long-term care pharmacies, hospitals and government organizations. He is also a minority owner and Director at Leading Pharma LLC, a generic manufacturer of prescription drugs, having previously served as President and CEO and later Chairman of Hi-Tech Pharmacal Co., Inc., which was acquired by Akorn, Inc. for $640 million in 2014. Jerry Wolasky – Director – 65 Mr. Wolasky has over thirty-five years’ experience in the wholesale pharmaceutical business, most recently for the past sixteen years in his current role as President of HealthSource Distributors LLC. He previously served in executive positions of increasing responsibility for AmerisourceBergen, and its predecessor company, Bergen Brunswig. Tracy Clifford – Director -57 Ms. Clifford has over twenty years of experience in accounting and finance, including mergers and acquisitions of public companies. Ms. Clifford is the CFO of Acorn Energy, Inc. and COO of its operating subsidiary Omnimetrix Inc. and since 2015 she has served as a contract CFO and COO for several clients, participated on advisory boards and worked on numerous project engagements. Ms. Clifford previously served as CFO, Principal Accounting Officer, Corporate ~~Governance~~Controller and Secretary for a publicly traded pharmaceutical company and a publicly-traded REIT from 1999 to 2015. Ms. Clifford’s prior experience included accounting leadership positions at United Healthcare, the North Broward Hospital District and the audit team of Deloitte & Touche.

Biographical and certain other information concerning the Company’s officers and directors is set forth below. There are no familial relationships among any of our officers or directors. Except as indicated below, none of our directors is a director in any other reporting companies. None of our officers or directors has been affiliated with any company that has filed for bankruptcy within the last ten years. We are not aware of any proceedings to which any of our officers or directors, or any associate of any such officer or director is a party adverse to us or any of our subsidiaries or has a material interest adverse to us or any of our subsidiaries. Unless otherwise indicated, there are no arrangements or understandings between any officer and any other person pursuant to which such person was selected as an officer.18

~~Jan~~Audit Committee; ~~Loeb~~Audit –Committee President and Executive Chairman – 66 Mr. Loeb has more than 40 years of business, money management and investment banking experience. He has served as Chairman of our Board since July 2018 and on September 29, 2022 was appointed as Executive Chairman. On January 13, 2023, Mr. Loeb was appointed President of the Company. He has been the Managing Member of Leap Tide Capital Management LLC since 2007 and has served as President and CEO of Acorn Energy, Inc. since January 2016 and as a Director since August 2015. He has been a Director of Keweenaw Land Association, Ltd. From 2005 to 2007, Mr. Loeb was President of Leap Tide’s predecessor, formerly known as AmTrust Capital Management Inc. He served as a Portfolio Manager of Chesapeake Partners from February 2004 to January 2005 and as Managing Director at Jefferies & Company, Inc. from 2002 to 2004. From 1994 to 2001, he served as Managing Director at Dresdner Kleinwort Wasserstein, Inc. (formerly Wasserstein Perella & Co., Inc.). Mr. Loeb was a Lead Director of American Pacific Corporation from 2013 to 2014 and a Director from 1997 to 2014. He also served as an Independent Director of Pernix Therapeutics Holdings Inc. (formerly, Golf Trust of America, Inc.) from 2006 to 2011 and as a Director of TAT Technologies, Ltd. from 2009 to 2016. Christine Jenkins – Vice President and Chief Financial Officer – 61 Ms. Jenkins has over thirty-five years of experience in public accounting, including audit, consulting and corporate tax. Ms. Jenkins is currently serving as a consultant providing audit and accounting consultation to publicly-traded and large privately held companies. From 2010 to 2018 Ms. Jenkins was an audit partner with Cherry Bekaert, LLP. Prior to Cherry Bekaert, from 1995 to 2010, Ms. Jenkins was a partner in a local accounting firm in Atlanta, GA. Prior experience included audit and tax positions in public accounting firms. Mitchell Rubenstein – Director – 70 Mr. Rubenstein co-founded and served as Chairman of HMC from its inception to June 2018, during which period the company returned approximately $37 million to shareholders in the form of dividends and share repurchases, including a tender offer. He founded Syfy Channel and numerous other media and digital businesses. Eric Richman – Director -63 Mr. Richman is a life science executive with significant leadership, operational and strategic experience from over 25 years in the field. He is currently The CEO of Gain Therapeutics and was a Venture Partner at Brace Pharma Capital and serves on the boards of LabConnect, F2G (board observer) and previously ADMA Biologics (NASDAQ: ADMA). Previously he served as President & CEO of PharmAthene and prior to that was part of the founding team at MedImmune, responsible for the U.S. launch of its first commercial product and an integral part of the global launch teams for other products. He began his career at HealthCare Ventures, a life-sciences focused VC firm and formerly was a Director of Lev Pharmaceuticals (sold to Viropharma) and American Bank (sold to Congressional Bancshares) and served as CEO of Tyrogenex (sold to Betta Pharma). David Seltzer – Director – 64 Mr. Seltzer is the CEO and Founder of Reliable 1 Laboratories LLC, a distributor of OTC medications and nutritional supplements to independent pharmacies, long-term care pharmacies, hospitals and government organizations. He is also a minority owner and Director at Leading Pharma LLC, a generic manufacturer of prescription drugs, having previously served as President and CEO and later Chairman of Hi-Tech Pharmacal Co., Inc., which was acquired by Akorn, Inc. for $640 million in 2014. Jerry Wolasky – Director – 64 Mr. Wolasky has over 35 years’ experience in the wholesale pharmaceutical business, most recently for the past 15 years in his current role as President of HealthSource Distributors LLC. He previously served in executive positions of increasing responsibility for AmerisourceBergen, and its predecessor company, Bergen Brunswig. Tracy Clifford – Director -56 Ms. Clifford has over twenty years of experience in accounting and finance, including mergers and acquisitions of public companies. Ms. Clifford is the CFO of Acorn Energy, Inc. and COO of its operating subsidiary Omnimetrix Inc. and since 2015 she has served as a contract CFO and COO for several clients, participated on advisory boards and worked on numerous project engagements. Ms. Clifford previously served as CFO, Principal Accounting Officer, Corporate Controller and Secretary for a publicly traded pharmaceutical company and a publicly-traded REIT from 1999 to 2015. Ms. Clifford’s prior experience included accounting leadership positions at United Healthcare, the North Broward Hospital District and the audit team of Deloitte & Touche.Expert

19The Company’s full board is functioning as our audit committee at the time of this Annual Report.

~~Audit~~Compensation Committee~~; Audit Committee Financial Expert~~

~~The~~We ~~Company’s~~do ~~full~~not ~~board~~have isa ~~functioning~~compensation committee or persons participating in deliberations concerning executive officer compensation as ~~our~~there ~~audit~~was no ~~committee~~executive atofficer ~~the~~compensation ~~time~~paid ofother ~~this~~than ~~Annual~~hourly ~~Report~~payments for Chief Financial Officer services during 2025 and 2024.

~~Compensation~~Nominating Committee

We do not have a ~~compensation~~nominating committee. orAll ~~persons~~directors ~~participating~~participate in ~~deliberations~~the ~~concerning~~nomination ~~executive~~and ~~officer~~election ~~compensation~~of ~~as there was no executive officer compensation paid other than hourly payments for Chief Financial Officer services during 2024 and 2023~~directors.

~~Nominating~~Section ~~Committee~~16(a) Beneficial Ownership Reporting Compliance; Delinquent Section 16(a) Reports

WeSection do16(a) ~~not~~of ~~have~~the aSecurities ~~nominating~~Exchange ~~committee.~~Act ~~All~~of 1934 (the “Exchange Act”) requires our executive officers and directors, ~~participate~~and persons who own more than 10% of a registered class of our equity securities to file reports of ownership and changes in ownership with the ~~nomination~~SEC. These persons are also required by SEC regulation to furnish us with copies of all Section 16(a) forms they file. Further, we have implemented measures to assure timely filing of Section 16(a) reports by our executive officers and ~~election~~directors. Based solely on our review of such forms or written representations from certain reporting persons, we believe that during 2025 our executive officers and directors complied with the filing requirements of Section 16(a).

~~Section~~Code ~~16(a)~~of ~~Beneficial Ownership Reporting Compliance; Delinquent Section 16(a) Reports~~Ethics

~~Section~~We ~~16(a)~~have ofadopted ~~the Securities Exchange Act of 1934 (the “Exchange Act”) requires our executive officers and directors, and persons who own more than 10% of~~ a ~~registered~~Code ~~class~~ of ~~our~~Business ~~equity~~Conduct ~~securities to file reports of ownership~~ and ~~changes~~Ethics inthat ~~ownership~~applies ~~with the SEC. These persons are also required by SEC regulation~~ to ~~furnish us with copies of~~ all ~~Section~~our ~~16(a) forms they file. Further~~directors, ~~we have implemented measures to assure timely filing of Section 16(a) reports by our executive~~ officers and ~~directors~~employees. ~~Based~~This ~~solely~~code ~~on our review~~ of ~~such~~ethics is ~~forms~~designed orto ~~written~~comply ~~representations~~with ~~from~~the ~~certain~~NASDAQ ~~reporting~~marketplace ~~persons,~~rules werelated ~~believe~~to ~~that~~codes ~~during 2024 our executive officers and directors complied with the filing requirements~~ of ~~Section 16(a)~~conduct.

~~Code~~Changes ofin ~~Ethics~~control

WeThere ~~have~~are ~~adopted~~no aarrangements ~~Code~~which ofmay ~~Business~~at ~~Conduct~~a ~~and~~subsequent ~~Ethics~~date ~~that~~result ~~applies~~in toa ~~all~~change ~~our~~in ~~directors,~~control ~~officers and employees. This code~~ of ~~ethics is designed to comply with~~ the ~~NASDAQ marketplace rules related to codes of conduct~~Company.

~~Changes in control~~19

~~There~~Item ~~are~~11. noExecutive ~~arrangements which may at a subsequent date result in a change in control of the Company~~Compensation.

20Executive and Director Compensation

Item 11. Executive Compensation.

Summary Compensation Table
								Option			All Other
			Salary			Bonus		Awards			Compensation		Total
Name and Principal Position	Year		($)			($)		($)			($)		($)
Jan H. Loeb		2025		-			-		-			-		-
President and Executive Chairman		2024		-			-		5,924	⁽¹⁾		-		5,924

Christine Jenkins		2025		29,940	⁽²⁾		-		-			-		29,940
Vice President and Chief Financial Officer		2024		48,275	⁽³⁾		-		-			-		48,275

Mitchell Rubenstein		2025		-			-		-			-		-
Director		2024		-			-		5,924	⁽¹⁾		-		5,924

Eric Richman		2025		-			-		-			-		-
Director		2024		-			-		5,924	⁽¹⁾		-		5,924

David Seltzer		2025		-			-		-			-		-
Director		2024		-			-		5,924	⁽¹⁾		-		5,924

Jerry Wolasky		2025		-			-		-			-		-
Director		2024		-			-		5,924	⁽¹⁾		-		5,924

Tracy Clifford		2025		-			-		-			-		-
Director		2024		-			-		5,924	⁽¹⁾		-		5,924

Executive and Director Compensation

	(1)	Represents the grant date fair value calculated in accordance with applicable accounting principles with respect to 100,000 options granted per Director and 100,000 options granted to the President and Executive Chairman on April 1, 2024 with an exercise price of $0.06. The fair value of the options was determined using the Black-Scholes option pricing model using the following assumptions: (i) a risk-free interest rate of 4.34% (ii) an expected term of 5.09 years (iii) an assumed volatility of 116.9853% and (iv) no dividends.
	(2)	Represents hourly fees due to Ms. Jenkins for the provision of services as Chief Financial Officer of the Company.
	(3)	Represents hourly fees paid to Ms. Jenkins for the provision of services as Chief Financial Officer of the Company.

Summary Compensation Table
								Option			All Other
			Salary			Bonus		Awards			Compensation		Total
Name and Principal Position	Year		($)			($)		($)			($)		($)
Jan H. Loeb		2024		-			-		5,924	(1)		-		5,924
President and Executive Chairman		2023		-			-		16,573	(2)		-		16,573
Christine Jenkins		2024		48,275	(3)		-		-			-		48,275
Vice President and Chief Financial Officer		2023		54,000	(3)		-		1,657	(1)		-		55,675
Mitchell Rubenstein		2024		-			-		5,924	(1)		-		5,924
Director		2023		-			-		8,286	(2)		-		8,286
Eric Richman		2024		-			-		5,924	(1)		-		5,924
Director		2023		-			-		8,286	(2)		-		8,286
David Seltzer		2024		-			-		5,924	(1)		-		5,924
Director		2023		-			-		8,286	(2)		-		8,286
Jerry Wolasky		2024		-			-		5,924	(1)		-		5,924
Director		2023		-			-		8,286	(2)		-		8,286
Tracy Clifford		2024		-			-		5,924	(1)		-		5,924
Director		2023		-			-		8,286	(2)		-		8,286

	(1)	Represents the grant date fair value calculated in accordance with applicable accounting principles with respect to 100,000 options granted per Director and 100,000 options granted to the President and Executive Chairman on April 1, 2024 with an exercise price of $0.06. The fair value of the options was determined using the Black-Scholes option pricing model using the following assumptions: (i) a risk-free interest rate of 4.34% (ii) an expected term of 5.09 years (iii) an assumed volatility of 116.9853% and (iv) no dividends.
	(2)	Represents the grant date fair value calculated in accordance with applicable accounting principles with respect to 50,000 options granted per Director, 100,000 options granted to the President and Executive Chairman and 10,000 options granted to the Vice President and Chief Financial Officer on March 23, 2023 with an exercise price of $0.20. The fair value of the options was determined using the Black-Scholes option pricing model using the following assumptions: (i) a risk-free interest rate of 3.39% (ii) an expected term of 4.98 years (iii) an assumed volatility of 118.3067% and (iv) no dividends.
	(3)	Represents hourly fees paid to Ms. Jenkins for the provision of services as Chief Financial Officer of the Company.

Executive Compensation for 2025 and 2024

21Our Chief Financial Officer and Vice President, Ms. Jenkins is paid on an hourly basis. Mr. Loeb, our Executive Chairman and President does not receive any compensation for his role as an officer of the Company.

~~Executive~~The ~~Compensation~~Company ~~for~~pays ~~2023~~compensation ~~and~~to ~~2024~~its directors pursuant to the NovelStem International Corp. Equity Incentive Plan (the “Plan”).

~~Our~~The ~~Chief~~Plan ~~Financial~~provides ~~Officer~~for ~~and~~the ~~Vice~~grant ~~President~~to officers, Msdirectors, third party contractors and other future key employees of options to purchase shares of common stock. ~~Jenkins~~Under the Plan, the Company is ~~paid~~authorized onto anissue ~~hourly~~up ~~basis.~~to Mr7,000,000 shares of common stock as equity awards under the Plan. ~~Loeb~~Awards may be made in the form of options, ~~our~~stock ~~Executive~~appreciation ~~Chairman~~rights ~~and~~(“SARs”), ~~President~~restricted ~~does~~stock or restricted stock ~~not~~units, ~~receive~~or ~~any~~stock ~~compensation~~bonus ~~for~~awards ~~his~~in ~~role~~respect asof anthe ~~officer~~Company’s common stock of the Company. Grants to any single participant or non-executive director during any calendar year may not exceed 1,000,000 shares.

The purchase price may be paid in cash or at the end of the option term, if the option is “in-the-money”, it is automatically exercised “net”. In a net exercise of an option, the Company ~~pays~~does ~~compensation~~not torequire ~~its~~a ~~directors~~payment ~~pursuant~~of the exercise price of the option from the optionee but reduces the number of shares of common stock issued upon the exercise of the option by the smallest number of whole shares that has an aggregate fair market value equal to or in excess of the ~~NovelStem~~aggregate ~~International~~exercise ~~Corp~~price for the option shares covered by the option exercised. ~~Equity~~Each ~~Incentive~~option ~~Plan~~is (exercisable to one share of the ~~“Plan”)~~Company’s common stock.

~~The~~Options awarded under the Plan ~~provides~~shall ~~for~~be ~~the~~awarded ~~grant~~at toan ~~officers,~~exercise ~~directors,~~price ~~third~~of ~~party~~not ~~contractors~~less ~~and~~than ~~other~~the ~~future~~fair ~~key~~market ~~employees~~value of ~~options~~a toshare ~~purchase shares~~ of our common stock. ~~Under~~as of the ~~Plan,~~grant ~~the~~date ~~Company~~and isshall ~~authorized~~vest toand ~~issue~~become upexercisable toafter ~~7,000,000~~a ~~shares~~period ofnot ~~common~~to ~~stock~~exceed asseven ~~equity~~(7) ~~awards~~years. SARs awarded under the Plan. ~~Awards~~shall have ~~may~~a bestrike ~~made~~price inper ~~the~~share ~~form~~ of ~~options,~~common stock ~~appreciation~~of ~~rights~~not ~~(“SARs”),~~less ~~restricted~~than ~~stock~~the orfair ~~restricted~~market ~~stock units,~~value orof a share of our common stock, ~~bonus~~provided ~~awards~~that, in the ~~respect~~case of a SAR granted in tandem with an option, the ~~Company’s~~strike ~~common~~price ~~stock~~shall not be less than the exercise price of the ~~Company~~related option. A ~~Grants~~SAR granted in tandem with an option shall become exercisable and shall expire according to ~~any~~the ~~single~~same ~~participant~~vesting orschedule ~~non-executive~~and expiration ~~director~~provisions ~~during~~as ~~any~~the ~~calendar~~corresponding ~~year~~option, ~~may~~such date not to exceed ~~1,000,000~~seven ~~shares~~(7) years of the grant date.

~~The~~In ~~purchase~~the ~~price~~event ~~may~~of bethe ~~paid~~termination inof ~~cash~~an employee, third party service provider, officer or atDirector’s service on the ~~end~~Board of the ~~option~~Company for ~~term~~any reason other than for cause, ifall of the ~~option~~options iswhich ~~“in-the-money”,~~are itthen isvested ~~automatically exercised~~may ~~“net”.~~be Inexercised awithin ~~net~~18 ~~exercise~~months of ansuch ~~option~~termination, provided ~~the~~that, ~~Company~~in ~~does~~no ~~not~~event ~~require~~shall athis ~~payment~~extension ofperiod continue beyond the ~~exercise~~expiration ~~price~~of the term of the option(s). In addition, any ~~from~~such ~~the~~extension ~~optionee~~shall ~~but~~be ~~reduces~~applicable only to the ~~number~~extent ofthat ~~shares~~such ofoption ~~common~~or ~~stock~~options ~~issued~~are ~~upon~~vested and exercisable according to the ~~exercise~~terms of the Plan and any applicable option byagreement. ~~the~~Any ~~smallest~~unvested ~~number~~options ofare ~~whole shares~~immediately ~~that~~terminated ~~has~~on anthe ~~aggregate~~effective ~~fair~~date ~~market~~of ~~value~~the ~~equal~~termination. In tothe orevent inof ~~excess~~termination of ~~the~~an ~~aggregate~~employee, ~~exercise~~third ~~price~~party ~~for~~service ~~the~~provider, ~~option~~officer ~~shares~~or ~~covered~~Director’s byservice for cause, all options ~~the~~are ~~option~~forfeited ~~exercised.~~and ~~Each~~deemed ~~option~~cancelled isand ~~exercisable~~no tolonger ~~one~~exercisable ~~share~~as of the ~~Company’s~~date ~~common~~of ~~stock~~termination.

Options awarded under the Plan shall be awarded at an exercise price of not less than the fair market value of a share of our common stock as of the grant date and shall vest and become exercisable after a period not to exceed seven (7) years. SARs awarded under the Plan shall have a strike price per share of common stock of not less than the fair market value of a share of our common stock, provided that, in the case of a SAR granted in tandem with an option, the strike price shall not be less than the exercise price of the related option. A SAR granted in tandem with an option shall become exercisable and shall expire according to the same vesting schedule and expiration provisions as the corresponding option, such date not to exceed seven (7) years of the grant date.21

InOutstanding ~~the~~Equity ~~event~~Awards ofat ~~the~~2025 ~~termination~~Fiscal ofYear an employee, third party service provider, officer or Director’s service on the Board of the Company for any reason other than for cause, all of the options which are then vested may be exercised within 18 months of such termination, provided that, in no event shall this extension period continue beyond the expiration of the term of the option(s). In addition, any such extension shall be applicable only to the extent that such option or options are vested and exercisable according to the terms of the Plan and any applicable option agreement. Any unvested options are immediately terminated on the effective date of the termination. In the event of termination of an employee, third party service provider, officer or Director’s service for cause, all options are forfeited and deemed cancelled and no longer exercisable as of the date of termination.End

22The following tables set forth all outstanding equity awards made to each of the Executives and Directors that were outstanding at December 31, 2025.

Outstanding Equity Awards at 2024 Fiscal Year End

Options to Purchase NovelStem International Corp. Stock
Name	Number of Securities Underlying Unexercised Options (#) Exercisable		Number of Securities Underlying Unexercised Options (#) Unexercisable	Option Exercise Price ($)		Option Expiration Date
Jan H. Loeb		50,000			0.10	November 26, 2026
		1,000,000			0.10	November 24, 2027
		100,000			0.29	January 31, 2029
		100,000			0.20	March 23, 2030
		100,000			0.06	April 1, 2031
Mitchell Rubenstein		50,000			0.10	November 26, 2026
		1,000,000			0.10	November 24, 2027
		100,000			0.29	January 31, 2029
		50,000			0.20	March 23, 2030
		100,000			0.06	April 1, 2031
Eric Richman		50,000			0.10	November 26, 2026
		50,000			0.10	November 24, 2027
		100,000			0.29	January 31, 2029
		50,000			0.20	March 23, 2030
		100,000			0.06	April 1, 2031
David Seltzer		50,000			0.10	November 26, 2026
		50,000			0.10	November 24, 2027
		100.000			0.29	January 31, 2029
		50,000			0.20	March 23, 2030
		100,000			0.06	April 1, 2031
Jerry Wolasky		50,000			0.10	November 26, 2026
		50,000			0.10	November 24, 2027
		100,000			0.29	January 31, 2029
		50,000			0.20	March 23, 2030
		100,000			0.06	April 1, 2031
Tracy Clifford		50,000			0.10	November 26, 2026
		1,000,000			0.10	November 24, 2027
		100,000			0.29	January 31, 2029
		50,000			0.20	March 23, 2030
		100,000			0.06	April 1, 2031
Christine Jenkins		10,000			0.20	March 23, 2030

~~The following tables set forth all outstanding equity awards made to each of the Executives and Directors that were outstanding at December 31, 2024.~~22

Options to Purchase NovelStem International Corp. Stock
Name	Number of Securities Underlying Unexercised Options (#) Exercisable		Number of Securities Underlying Unexercised Options (#) Unexercisable		Option Exercise Price ($)		Option Expiration Date
Jan H. Loeb		50,000				0.10	November 12, 2025
		50,000				0.10	November 26, 2026
		1,000,000				0.10	November 24, 2027
		100,000				0.29	January 31, 2029
		100,000				0.20	March 23, 2030
				100,000		0.06	April 1, 2031
Mitchell Rubenstein		50,000				0.10	November 12, 2025
		50,000				0.10	November 26, 2026
		1,000,000				0.10	November 24, 2027
		100,000				0.29	January 31, 2029
		50,000				0.20	March 23, 2030
				100,000		0.06	April 1, 2031
Eric Richman		50,000				0.10	November 12, 2025
		50,000				0.10	November 26, 2026
		50,000				0.10	November 24, 2027
		100,000				0.29	January 31, 2029
		50,000				0.20	March 23, 2030
				100,000		0.06	April 1, 2031
David Seltzer		50,000				0.10	November 12, 2025
		50,000				0.10	November 26, 2026
		50,000				0.10	November 24, 2027
		100.000				0.29	January 31, 2029
		50,000				0.20	March 23, 2030
				100,000		0.06	April 1, 2031
Jerry Wolasky		50,000				0.10	November 12, 2025
		50,000				0.10	November 26, 2026
		50,000				0.10	November 24, 2027
		100,000				0.29	January 31, 2029
		50,000				0.20	March 23, 2030
				100,000		0.06	April 1, 2031
Tracy Clifford		50,000				0.10	November 12, 2025
		50,000				0.10	November 26, 2026
		1,000,000				0.10	November 24, 2027
		100,000				0.29	January 31, 2029
		50,000				0.20	March 23, 2030
				100,000		0.06	April 1, 2031
Christine Jenkins				10,000		0.20	March 23, 2030

Option and Warrant Exercises

Warrants to Purchase NovelStem International Corp. Stock
Name	Number of Securities Underlying Unexercised Warrants (#) Exercisable		Number of Securities Underlying Unexercised Warrants (#) Unexercisable		Warrant Exercise Price ($)		Warrant Expiration Date
Jan H. Loeb		2,250,000		-		0.13		June 28, 2025
Mitchell Rubenstein		750,000		-		0.10		June 28, 2025
Eric Richman		-		-		-		-
David Seltzer		-		-		-		-
Jerry Wolasky		-		-		-		-
Tracy Clifford		-		-		-		-
Christine Jenkins		-		-		-		-

None

23Non-qualified Deferred Compensation

~~Option~~The ~~and~~Company ~~Warrant~~has ~~Exercises~~no deferred compensation plan in place during the years ended December 31, 2025 and 2024.

~~None~~Payments and Benefits Upon Termination or Change in Control

~~Non-qualified~~There ~~Deferred~~are ~~Compensation~~no agreements in place with any Executive or Director that would provide for any amounts due under any termination scenario at December 31, 2025.

~~The~~Item ~~Company~~12. ~~has~~Security noOwnership ~~deferred~~of ~~compensation~~Certain ~~plan~~Beneficial inOwners ~~place~~and ~~during~~Management ~~the~~and ~~years~~Related ~~ended~~Stockholder ~~December 31, 2024 and 2023~~Matters.

~~Payments~~The following table sets forth certain information with respect to the beneficial ownership of our common stock, as of December 31, 2025, for each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock, each of our directors and ~~Benefits~~all ~~Upon~~directors ~~Termination~~as ora ~~Change~~group. The Company has no executive officers. Except as indicated in ~~Control~~footnotes to this table, we believe that the shareholders named in this table will have sole voting and investment power with respect to all shares of common stock shown to be beneficially owned by them, based on information provided to us by such shareholders.

~~There~~Security ~~are~~Ownership noof ~~agreements~~Certain inBeneficial ~~place~~Owners ~~with~~and ~~any Executive or Director that would provide for any amounts due under any termination scenario at December 31, 2024.~~Management

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Name and Address of beneficial owner (6)	Amount and nature of beneficial ownership			Percent of total common equity (1)
Christine Jenkins		10,000			0.0	%
Michael Sosnowik		2,770,270			5.2	%
Stephen Gans		7,034,172			13.3	%
Jan Loeb		5,470,673	⁽²⁾⁽⁴⁾		10.35	%
Jerry Wolasky		10,322,973	⁽³⁾⁽⁴⁾		19.5	%
Tracy Clifford		1,300,000	⁽⁴⁾⁽⁵⁾		2.5	%
Eric Richman		904,054	⁽³⁾⁽⁴⁾		1.7	%
Mitchell Rubenstein		2,408,108	⁽⁴⁾⁽⁵⁾		4.5	%
David Seltzer		3,674,324	⁽³⁾⁽⁴⁾		6.9	%
All directors and officers as a group (seven persons)		24,190,132			45.7	%

~~The~~(1) ~~following~~Applicable ~~table~~percentage ~~sets~~ownership ~~forth~~is ~~certain~~based ~~information~~on ~~with~~46,881,475 ~~respect~~shares ~~to the beneficial ownership~~ of ~~our~~ common stock, outstanding as of December 31, ~~2024~~2025, together with securities ~~for~~exercisable ~~each~~or ~~person~~convertible ~~known~~into byshares usof tocommon bestock ~~the~~within ~~beneficial~~60 ~~owner~~days of ~~more~~December ~~than~~31, 5%2025. ofBeneficial ~~our~~ownership ~~outstanding~~is ~~shares~~determined ofin ~~common~~accordance with ~~stock,~~the ~~each~~rules of ~~our~~the ~~directors~~ Securities and ~~all~~Exchange ~~directors~~Commission asand agenerally ~~group.~~includes ~~The~~voting ~~Company~~or ~~has~~investment nopower ~~executive~~with ~~officers~~respect to securities. Shares ~~Except~~of ascommon ~~indicated~~stock inthat ~~footnotes~~a person has the right to ~~this~~acquire ~~table,~~beneficial weownership ~~believe~~of ~~that~~ upon the ~~shareholders~~exercise ~~named~~or inconversion ~~this~~of ~~table~~options, ~~will~~convertible stock, ~~have~~warrants ~~sole~~or ~~voting~~other ~~and~~securities ~~investment~~that ~~power~~are ~~with~~currently ~~respect~~exercisable toor ~~all~~convertible ~~shares~~or that will become exercisable or convertible within 60 days of ~~common~~December ~~stock~~31, ~~shown~~2025, are deemed to be beneficially owned by ~~them,~~the ~~based~~person onholding ~~information~~such ~~provided~~securities tofor usthe bypurpose of computing the number of shares beneficially owned and percentage of ownership of such ~~shareholders~~person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.

~~Security~~(2) ~~Ownership~~Includes 1,108,108 held in an IRA and 874,528 held as Trustee for the Steinberg Family Trust. Includes options to purchase 1,050,000 million shares of ~~Certain~~common ~~Beneficial~~stock ~~Owners~~at an exercise price of $0.10 per share, options to purchase 100,000 shares of common stock at an exercise price of $0.29 per share, options to purchase 100,000 shares of common stock at an exercise price of $0.20 per share, and ~~Management~~options to purchase 100,000 shares of common stock at an exercise price of $0.06 per share.

Name and Address of beneficial owner (6)	Amount and nature of beneficial ownership			Percent of total common equity (1)
Christine Jenkins		10,000			0.0	%
Michael Sosnowik		2,770,270			5.0	%
Stephen Gans		7,034,172			12.6	%
Jan Loeb		7,770,673	(2)(4)		14.0	%
Jerry Wolasky		10,272,973	(3)(4)		18.5	%
Tracy Clifford		1,250,000	(3)(4)		2.2	%
Eric Richman		854,054	(3)(4)		1.5	%
Mitchell Rubenstein		3,108,108	(4)(5)		5.6	%
David Seltzer		3,624,324	(3)(4)		6.5	%
All directors and officers as a group (seven persons)		26,890,132			48.3	%

(3) Includes options to purchase 100,000 shares of common stock at an exercise price of $0.10 per share, options to purchase 100,000 shares of common stock at an exercise price of $0.29 per share, options to purchase 50,000 shares of common stock at an exercise price of $0.20 per share, and options to purchase 100,000 shares of common stock at an exercise price of $0.06 per share.

(14) Applicable percentage ownership is based on 46,881,475 shares of common stock outstanding as of December 31, 2024, together with securities exercisable or convertible into shares of common stock within 60 days of December 31, 2024Director. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of common stock that a person has the right to acquire beneficial ownership of upon the exercise or conversion of options, convertible stock, warrants or other securities that are currently exercisable or convertible or that will become exercisable or convertible within 60 days of December 31, 2024, are deemed to be beneficially owned by the person holding such securities for the purpose of computing the number of shares beneficially owned and percentage of ownership of such person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.

(25) Includes ~~1,108,108~~options ~~held in an IRA and 874,528 held as Trustee for the Steinberg Family Trust. Includes warrants~~ to purchase 21,~~250~~050,000 ~~million~~ shares of common stock at an exercise price of $0.1310 per share, options to purchase 1,100,000 ~~million~~ shares of common stock at an exercise price of $0.1029 per share, options to purchase ~~100~~50,000 shares of common stock at an exercise price of $0.29 20 per share, and options to purchase 100,000 shares of common stock at an exercise price of $0.2006 per share.

(36) ~~Includes~~The ~~options~~address ~~to purchase 150,000 shares~~ of ~~common~~each ~~stock~~person atis anc/o ~~exercise~~NovelStem ~~price~~International ~~of $0~~Corp.10 ~~per~~7740 ~~share~~Cavern Lane, ~~options~~Suite ~~to purchase~~ 100~~,000~~ ~~shares of~~Parkland ~~common~~FL ~~stock at an exercise price of $0~~33067.~~29 per share, and options to purchase 50,000 shares of common stock at an exercise price of $0.20 per share.~~

~~(4) Director.~~23

~~(5)~~Securities ~~Includes~~authorized ~~options~~for ~~and~~issuance ~~warrants~~under toequity ~~purchase~~compensation 1,850,000 shares of common stock at an exercise price of $0.10 per share, options to purchase 100,000 shares of common stock at an exercise price of $0.29 per share, and options to purchase 50,000 shares of common stock at an exercise price of $0.20 per share.plans

~~(6)~~Equity ~~The~~Compensation ~~address~~Plan ~~of each person is c/o NovelStem International Corp. 2255 Glades Road, Suite 221A, Boca Raton, FL 33431.~~Information

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by security holders		-		-		-
Equity compensation plans not approved by security holders		6,060,000	$	0.1365		940,000
Total		6,060,000	$	0.1365		940,000

~~Securities~~Item ~~authorized~~13. ~~for~~Certain ~~issuance~~Relationships ~~under~~and ~~equity~~Related ~~compensation~~Transactions, ~~plans~~and Director Independence.

~~Equity~~Jan ~~Compensation~~Loeb, ~~Plan~~our ~~Information~~President and Executive Chairman of the Board, was also the Chairman of the Board of NewStem until its liquidation.

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by security holders
Equity compensation plans not approved by security holders		9,360,000	$	0.1347		640,000
Total		9,360,000	$	0.1347		640,000

During the year ended December 31, 2022, the Company entered into note agreements with Jan Loeb, our Executive Chairman and Jerry Wolasky, a shareholder and member of the Board, to borrow up to an aggregate of $600,000 for working capital needs. The note agreements were amended in March 2024 to increase the total borrowing to $650,000 and extend the maturity date. The note agreements were refinanced in August 2024 providing for total borrowings of $750,000. The agreements provide for interest at a rate of 10% per annum and mature December 31, 2025. As of the date of this Annual Report, the full amount of $750,000 has been funded pursuant to these agreements and the maturity date has been extended to June 30, 2026.

~~Item~~On 13May 5, 2023, the Company entered into a long term note payable with a shareholder for $300,000 in financing to be funded $150,000 at inception and $150,000 in October 2023. ~~Certain~~This ~~Relationships~~note bore interest at zero percent (0%) and ~~Related~~matured ~~Transactions~~on May 5, 2025. This note agreement was restructured during 2025 to provide for a fixed amount of interest in lieu of the guarantee and ~~Director~~beginning ~~Independence~~October 1, 2025, the note began to bear interest at a rate of 10% per annum. The note matures on December 31, 2026.

~~Jan~~In ~~Loeb~~February 2025, our ~~President and~~ Executive Chairman ofbegan advancing funds to the ~~Board,~~Company isfor ~~also~~operating expenses in the ~~Chairman~~form of an interim bridge loan until alternate funding sources can be found. The bridge loan matured December 31, 2025 and has been extended to June 30, 2026. The total advanced during the ~~Board~~year ofended ~~NewStem~~December 31, 2025 was $161,867.

~~During~~Except ~~the~~as ~~year~~disclosed ~~ended~~herein, ~~December~~no 31director, ~~2022~~executive officer, ~~the~~stockholder ~~Company~~holding ~~entered~~at ~~into~~least ~~note~~5% ~~agreements~~of ~~with~~shares ~~Jan~~of ~~Loeb,~~ our ~~Executive~~common ~~Chairman~~stock, ~~and~~or ~~Jerry~~any ~~Wolasky,~~family amember ~~shareholder~~thereof, ~~and~~had ~~member~~any ofmaterial ~~the Board~~interest, todirect ~~borrow~~or ~~up to an aggregate of $600~~indirect,~~000~~ ~~for working capital needs. The note agreements were amended~~ in ~~March~~any ~~2024~~transaction, toor ~~increase~~proposed ~~the~~transaction ~~total~~since ~~borrowing~~January to1, ~~$650~~2019,~~000~~ ~~and~~in ~~extend~~which the amount ~~maturity~~involved ~~date. The note agreements were refinanced~~ in ~~August 2024~~the ~~providing~~transaction ~~for~~exceeds ~~total~~the ~~borrowings~~lesser of $~~750~~120,000. ~~The~~or ~~agreements~~one ~~provide~~percent ~~for~~of ~~interest~~the ataverage ~~a rate~~ of ~~10%~~our ~~per~~total ~~annum~~assets ~~and~~at ~~mature~~the ~~December~~year-end ~~31,~~for ~~2025. As of~~ the ~~date~~last oftwo ~~this~~completed ~~Annual~~fiscal ~~Report, the full amount of $750,000 has been funded pursuant to these agreements~~years.

~~Except as disclosed herein~~Review, ~~no director, executive officer, stockholder holding at least 5% of shares of our common stock, or any family member~~ ~~thereof,~~Approval ~~had any material interest, direct~~ or ~~indirect,~~Ratification ~~in any transaction, or proposed transaction since January 1, 2019, in which the amount involved in the transaction exceeds the lesser~~ of ~~$120,000~~Transactions orwith ~~one~~Related ~~percent of the average of our total assets at the year-end for the last two completed fiscal years.~~Persons

25The Board conducts an appropriate review of and oversees all related party transactions on a continuing basis and reviews potential conflict of interest situations where appropriate. The Board has adopted formal standards to apply when it reviews, approves or ratifies any related party transaction. In addition, the Board applies the following standards to such reviews: (i) all related party transactions must be fair and reasonable and on terms comparable to those reasonably expected to be agreed to with independent third parties for the same goods and/or services at the time they are authorized by the Board and (ii) all related party transactions should be authorized, approved or ratified by the affirmative vote of a majority of the directors who have no interest, either directly or indirectly, in any such related party transaction.

~~Review,~~Director ~~Approval or Ratification of Transactions with Related Persons~~Independence

~~The~~We ~~Board~~have ~~conducts~~determined an appropriate review of and oversees all related party transactions on a continuing basis and reviews potential conflict of interest situations where appropriate. The Board has adopted formal standards to apply when it reviewsthat, ~~approves~~under ~~or ratifies any related party transaction. In addition,~~ the ~~Board~~criteria ~~applies~~established the following standards to such reviews: (i) all related party transactions must be fair and reasonable and on terms comparable to those reasonably expected to be agreed to with independent third parties for the same goods and/or services at the time they are authorized by ~~the~~NASDAQ ~~Board~~ and ~~(ii) all related party transactions should be authorized, approved or ratified~~ by ~~the~~our ~~affirmative~~board ~~vote~~ of ~~a majority of the~~ directors, ~~who~~Tracy ~~have no interest~~Clifford, ~~either~~Eric ~~directly or indirectly~~Richman, inMitchell Rubenstein ~~any~~and ~~such~~David ~~related party~~Seltzer ~~transaction~~are independent.

~~Director~~Item ~~Independence~~14. Principal Accountant Fees and Services.

WeAccounting ~~have determined that, under the criteria established by NASDAQ and by our board of directors, Tracy Clifford, Eric Richman, Mitchell Rubenstein and David Seltzer are independent.~~Fees

~~Item~~Kreit ~~14.~~& ~~Principal~~Chiu ~~Accountant~~CPA ~~Fees and Services.~~LLP

~~Accounting~~The ~~Fees~~following table summarizes the fees accrued and paid by NovelStem for professional services rendered by Kreit & Chiu CPA LLP for the years ended December 31, 2025 and 2024.

Kreit & Chiu CPA LLP

	2025		2024
Audit fees	$	102,090	$	113,030
Tax Fees		-		-
All other fees		-		-
Total	$	102,090	$	113,030

~~The~~Pre-Approval ~~following~~Policies ~~table summarizes the fees accrued~~ and ~~paid by NovelStem for professional services rendered by Kreit & Chiu CPA LLP and Cherry Bekaert LLP for the years ended December 31, 2024 and 2023.~~Procedures

	2024		2023
Audit fees	$	113,030	$	111,605
Tax Fees		-		6,400
All other fees		-		-
Total	$	113,030	$	118,005

The Audit Committee’s current policy is to pre-approve all audit and non-audit services that are to be performed and fees to be charged by our independent auditor to assure that the provision of these services does not impair the independence of the auditor. The Audit Committee pre-approved all audit and non-audit services rendered by our principal accountant in 2025 and 2024.

~~Pre-Approval Policies and Procedures~~25

~~The~~PART Audit Committee’s current policy is to pre-approve all audit and non-audit services that are to be performed and fees to be charged by our independent auditor to assure that the provision of these services does not impair the independence of the auditor. The Audit Committee pre-approved all audit and non-audit services rendered by our principal accountant in 2024 and 2023.IV

26Item 15. Exhibit and Financial Statement Schedules.

~~PART IV~~(a) Financial Statements.

~~Item~~The ~~15.~~following ~~Exhibit~~financial ~~and~~statements ~~Financial~~are ~~Statement~~filed ~~Schedules.~~as part of this registration statement:

~~(a)~~NOVELSTEM INTERNATIONAL ~~Financial Statements~~CORP.

~~The~~Years ~~following~~Ended ~~financial~~December ~~statements~~31, ~~are~~2025 ~~filed~~and ~~as part of this registration statement:~~2024

~~NOVELSTEM~~Index ~~INTERNATIONAL~~to ~~CORP.~~Audited Financial Statements

Years Ended December 31, 2024 and 2023

		Page
Audited Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID: 6651)		F-1
Balance Sheets		F-2
Statements of Operations		F-3
Statements of Changes in Shareholders’ Equity (Deficit)		F-4
Statements of Cash Flows		F-5
Notes to Financial Statements		F-6

~~Index to Audited Financial Statements~~26

		Page
Audited Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID: 6651)		F-1
Balance Sheets		F-2
Statements of Operations		F-3
Statements of Changes in Shareholders’ Equity (Deficit)		F-4
Statements of Cash Flows		F-5
Notes to Financial Statements		F-6

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

27Board of Directors and Shareholders of

~~REPORT~~NovelStem OFInternational ~~INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM~~Corp.

~~Board~~Opinion on ofthe ~~Directors~~Financial ~~and Shareholders of~~Statements

We have audited the accompanying balance sheets of NovelStem International Corp. as of December 31, 2025 and 2024, and the related statements of operations, shareholders’ equity (deficit), and cash flows for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of NovelStem International Corp. as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

~~Opinion on the Financial Statements~~Going Concern

WeThe accompanying financial statements have ~~audited~~been ~~the~~prepared ~~accompanying~~assuming ~~balance~~that ~~sheets~~the ~~of NovelStem~~entity ~~International~~will ~~Corp.~~continue as ofa ~~December~~going ~~31,~~concern. ~~2024~~As ~~and~~discussed ~~2023,~~in ~~and~~Note 1 to the ~~related~~financial statements ~~of operations~~, ~~shareholders’~~the ~~equity~~entity ~~(deficit), and~~has ~~cash~~an ~~flows~~accumulated ~~for~~deficit ~~the~~of ~~two~~approximately ~~years~~$294 ~~then~~million ~~ended,~~ and ~~the~~$296 ~~related~~million ~~notes~~at ~~(collectively~~December ~~referred to as the “financial statements”).~~31, In2025 ~~our~~and ~~opinion~~2024, ~~the financial statements present fairly~~respectively, inand ~~all~~has ~~material~~suffered ~~respects,~~losses ~~the~~from ~~financial~~operations ~~position~~that ofraise ~~NovelStem~~substantial ~~International~~doubt ~~Corp. as~~about ofits ~~December~~ability ~~31,~~to ~~2024~~continue ~~and~~as ~~2023,~~a going ~~and~~concern. ~~the~~Management's ~~results~~plans ofin ~~its~~regard ~~operations~~to ~~and~~these ~~its~~matters ~~cash~~are ~~flows~~also ~~for~~described ~~each~~in ofNote ~~the~~1. ~~two~~The ~~years~~financial ~~then~~statements ~~ended,~~do innot ~~conformity~~include ~~with~~any ~~accounting~~adjustments ~~principles~~that ~~generally~~might ~~accepted~~result infrom the ~~United~~outcome ~~States~~ of ~~America~~this uncertainty.

~~Going~~Basis for ~~Concern~~Opinion

~~The accompanying~~ These financial statements ~~have~~are ~~been~~the ~~prepared assuming~~responsibility ~~that~~of the entity’s ~~will~~management. ~~continue~~Our asresponsibility ais ~~going~~to ~~concern.~~express Asan ~~discussed~~opinion inon ~~Note~~these 1financial statements tobased ~~the~~on ~~financial~~our ~~statements,~~audits. ~~the~~We ~~entity~~are ~~has~~a ~~suffered losses~~public ~~from~~accounting ~~operations~~firm ~~that~~registered ~~raise~~with ~~substantial~~the ~~doubt~~Public ~~about~~Company ~~its~~Accounting ~~ability~~Oversight toBoard ~~continue~~(United States) as("PCAOB") aand ~~going~~are ~~concern.~~required ~~Management’s~~to ~~plans~~be inindependent ~~regard to~~with ~~these~~respect ~~matters~~to ~~are~~NovelStem ~~also~~International ~~described~~Corp. in ~~Note~~accordance 1with the U.S. federal ~~The~~securities ~~financial~~laws ~~statements~~and dothe ~~not~~applicable ~~include~~rules ~~any~~and ~~adjustments~~regulations ~~that~~of ~~might~~the ~~result~~Securities ~~from~~and ~~the~~Exchange ~~outcome of~~Commission ~~this~~and ~~uncertainty~~the PCAOB.

~~Basis~~We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. NovelStem International Corp. is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for ~~Opinion~~the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion.

~~These~~Our audits ~~financial~~included ~~statements~~performing ~~are~~procedures to assess the ~~responsibility~~ risks of ~~the~~material ~~entity’s~~misstatement ~~management.~~of ~~Our~~the ~~responsibility~~financial isstatements, towhether ~~express~~due anto ~~opinion~~error or onfraud, ~~these~~and ~~financial~~performing ~~statements~~procedures ~~based~~that onrespond ~~our~~to ~~audits~~those risks. WeSuch ~~are a~~procedures ~~public~~included ~~accounting~~examining, ~~firm~~on ~~registered~~a ~~with~~test basis, evidence regarding the ~~Public~~amounts ~~Company~~and ~~Accounting~~disclosures ~~Oversight~~in ~~Board~~the ~~(United~~financial ~~States)~~statements. ~~(“PCAOB”)~~Our ~~and~~audits ~~are~~also ~~required to~~included beevaluating ~~independent~~the ~~with~~accounting ~~respect~~principles toused ~~NovelStem~~and ~~International~~significant estimates ~~Corp.~~made inby ~~accordance~~management, ~~with~~as ~~the~~well ~~U.S.~~as ~~federal~~evaluating ~~securities~~the ~~laws~~overall ~~and~~presentation of the ~~applicable rules~~financial ~~and~~statements. ~~regulations~~We ofbelieve ~~the~~that ~~Securities~~our ~~and~~audits provide ~~Exchange~~a ~~Commission~~reasonable ~~and~~basis ~~the~~for ~~PCAOB~~our opinion.

~~We conducted our audits in accordance with the standards~~Critical ofAudit the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. NovelStem International Corp. is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, we express no such opinion.Matters

~~Our~~Critical audit ~~audits~~matters ~~included~~are ~~performing~~matters ~~procedures~~arising tofrom ~~assess~~ the ~~risks~~current ofperiod ~~material~~audit ~~misstatement~~ of the financial statements, ~~whether~~that ~~due~~were tocommunicated ~~error~~ or ~~fraud,~~required ~~and~~to ~~performing procedures that respond~~be communicated to ~~those~~the ~~risks.~~audit ~~Such~~committee ~~procedures~~and ~~included~~that: ~~examining,~~(1) onrelate ato ~~test~~accounts ~~basis,~~or ~~evidence~~disclosures ~~regarding~~that ~~the~~are ~~amounts~~material ~~and~~to ~~disclosures in~~ the financial statements~~. Our~~ ~~audits also included evaluating the accounting principles used~~ and (2) ~~significant~~involved ~~estimates~~our ~~made~~especially bychallenging, ~~management~~subjective, asor ~~well~~complex ~~as evaluating the overall presentation of the financial statements~~judgments. We ~~believe~~determined that ~~our~~there ~~audits~~are ~~provide~~no acritical ~~reasonable~~audit ~~basis for our opinion~~matters.

~~Critical~~/s/ Kreit ~~Audit~~& ~~Matters~~Chiu CPA LLP

~~Critical audit matters are matters arising from the~~We ~~current~~have ~~period~~served ~~audit~~as ofNovelStem ~~the~~International financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgmentsCorp.'s Weauditor ~~determined~~since ~~that there are no critical audit matters~~2024.

~~/s/ Kreit~~Los &Angeles, ~~Chiu CPA LLP~~California

WeMarch 25, ~~have served as NovelStem International Corp.’s auditor since 2024.~~2026

~~Los Angeles, California~~F-1

~~April~~NOVELSTEM INTERNATIONAL 7,CORP. BALANCE ~~2025~~SHEETS

F-1

	2025			2024
	As of December 31,
	2025			2024

ASSETS
Current assets:
Cash	$	333		$	6,099
Accounts receivable, administrative fees		-			10,500
Prepaid expenses		15,453			15,272
Total current assets		15,786			31,871
Investment in NetCo		-			128,240
Total assets	$	15,786		$	160,111

LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	215,958		$	167,898
Accrued expenses		37,673			68,576
Notes payable, including accrued interest		317,734			250,000
Current portion of long-term notes payable, including accrued interest		1,295,405			4,059,366
Bridge loan payable, related party, including accrued interest		171,857			-
Convertible debt, including accrued interest		118,814			108,646
Derivative liability, guarantee		-			650,000
Total liabilities		2,157,441			5,304,486
Commitments and contingencies (see Note 7)		-			-
Shareholders’ equity (deficit):
Common stock, $.01 par value, 100,000,000 shares authorized, 50,316,672 shares issued at December 31, 2025 and 2024 and 46,881,475 shares outstanding at December 31, 2025 and 2024		468,815			468,815
Additional paid-in capital		291,570,255			290,947,417
Accumulated deficit		(293,980,971	)		(296,360,853	)
Treasury stock, at cost, 3,435,197 shares at December 31, 2025 and 2024		(199,754	)		(199,754	)
Total shareholders’ equity (deficit)		(2,141,655	)		(5,144,375	)
Total liabilities and shareholders’ equity (deficit)	$	15,786		$	160,111

~~NOVELSTEM~~The ~~INTERNATIONAL~~accompanying ~~CORP. BALANCE~~notes ~~SHEETS~~are an integral part of these financial statements.

	2024			2023
	As of December 31,
	2024			2023
ASSETS
Current assets:
Cash	$	6,099		$	53,063
Accounts receivable, administrative fees		10,500			-
Prepaid expenses		15,272			33,540
Total current assets		31,871			86,603
Investment in Netco		128,240			133,709
Note receivable, NewStem		-			250,000
Investment in NewStem		-			1,784,234
Total assets	$	160,111		$	2,254,546
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	167,898		$	54,257
Accrued expenses		68,576			42,223
Notes payable		250,000			250,000
Current portion of long-term notes payable, including accrued interest		4,059,366			-
Convertible debt, including accrued interest		108,646
Derivative liability, guarantee		650,000			-
Total current liabilities		5,304,486			346,480
Long-term liabilities:
Long-term notes payable, including accrued interest, net		-			3,324,599
Derivative liability, guarantee		-			535,000
Total long-term liabilities		-			3,859,599
Total liabilities		5,304,486			4,206,079
Commitments and contingencies (see Note 7)		-			-
Shareholders’ equity (deficit):
Common stock, $.01 par value, 100,000,000 shares authorized, 50,316,672 shares issued at December 31, 2024 and 2023 and 46,881,475 shares outstanding at December 31, 2024 and 2023		468,815			468,815
Additional paid-in capital		290,947,417			290,907,217
Accumulated deficit		(296,360,853	)		(293,127,811	)
Treasury stock, at cost, 3,435,197 shares at December 31, 2024 and 2023		(199,754	)		(199,754	)
Total shareholders’ equity (deficit)		(5,144,375	)		(1,951,533	)
Total liabilities and shareholders’ equity (deficit)	$	160,111		$	2,254,546

F-2

~~The~~NOVELSTEM ~~accompanying~~INTERNATIONAL ~~notes are an integral part of these financial statements~~CORP.

~~F-2~~STATEMENTS OF OPERATIONS

NOVELSTEM INTERNATIONAL CORP.

	2025			2024
	Years Ended
	December 31,
	2025			2024

Administrative fee income	$	-		$	12,000
Operating expenses:
General and administrative expenses		238,755			880,947
Litigation expenses (Note 7)		-			58,975
Total operating expenses		238,755			939,922
Loss from operations		(238,755	)		(927,922	)
Other (income) expenses:
Loss on derivative instrument		-			90,000
Gain on disposal of equity method investment		(1,171,760	)		-
Relief of indebtedness income		(1,697,024	)		-
Interest expense		256,219			425,417
Total other (income) expenses		(2,612,565	)		515,417
Income (loss) before income taxes		2,373,810			(1,443,339	)
Provision for income tax		-			-
Net income (loss) before equity in net loss of equity method investees		2,373,810			(1,443,339	)
Equity in net income (loss) of equity method investees		640			(161,046	)
Income from (impairment of) equity method investee, NewStem		5,432			(1,628,657	)
Net income (loss)	$	2,379,882		$	(3,233,042	)

Basic and diluted net income (loss) per share:
Net income (loss) per share - basic	$	0.05		$	(0.07	)
Weighted average number of shares outstanding – basic	$	46,881,475		$	46,881,475
Net income (loss) per share - diluted	$	0.05		$	(0.07	)
Weighted average number of shares outstanding - diluted	$	47,795,437		$	46,881,475

~~STATEMENTS~~The OFaccompanying ~~OPERATIONS~~notes are an integral part of these financial statements.

	2024			2023
	Year Ended
	December 31,
	2024			2023
Administrative fee income	$	12,000		$	12,000
Operating expenses:
General and administrative expenses		880,947			665,277
Litigation expenses		58,975			2,872,522
Total operating expenses		939,922			3,537,799
Loss from operations		(927,922	)		(3,525,799	)
Other expenses:
Loss on derivative instrument		90,000			260,000
Impairment loss on equity method investee		1,628,657			-
Interest expense		425,417			99,023
Total other expenses		2,144,074			359,023
Loss before income taxes		(3,071,996	)		(3,884,822	)
Provision for income tax		-			-
Net loss before equity in net loss of equity method investees		(3,071,996	)		(3,884,822	)
Equity in net loss of equity method investees		(161,046	)		(338,618	)
Gain on dilution of equity method investment		-			36,139
Net loss	$	(3,233,042	)	$	(4,187,301	)
Basic and diluted net loss per share:
Net loss per share - basic and diluted	$	(0.07	)	$	(0.09	)
Weighted average number of shares outstanding – basic		46,881,475			46,881,475
Weighted average number of shares outstanding – diluted		46,881,475			46,881,475

F-3

~~The~~NOVELSTEM ~~accompanying~~INTERNATIONAL ~~notes are an integral part of these financial statements~~CORP.

~~F-3~~STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT)

NOVELSTEM INTERNATIONAL CORP.

	Shares		Stock		Capital		Deficit			Shares		Stock			Equity
										Number
					Additional					of					Total
	Number of		Common		Paid-In		Accumulated			Treasury		Treasury			Shareholders’
	Shares		Stock		Capital		Deficit			Shares		Stock			Equity

Balance, December 31, 2023		46,881,475	$	468,815	$	290,907,217	$	(293,127,811	)		3,435,197	$	(199,754	)	$	(1,951,533	)
Net loss		-		-		-		(3,233,042	)		-		-			(3,233,042	)
Stock issued		-		-		-		-			-		-			-
Stock-based compensation		-		-		40,200		-								40,200
Balance, December 31, 2024		46,881,475		468,815		290,947,417		(296,360,853	)		3,435,197		(199,754	)		(5,144,375	)
Balance		46,881,475		468,815		290,947,417		(296,360,853	)		3,435,197		(199,754	)		(5,144,375	)
Net income		-		-		-		2,379,882			-		-			2,379,882
Net income (loss)		-		-		-		2,379,882			-		-			2,379,882
Debt restructuring						614,000										614,000
Stock-based compensation		-		-		8,838		-			-		-			8,838
Balance, December 31, 2025		46,881,475	$	468,815	$	291,570,255	$	(293,980,971	)		3,435,197	$	(199,754	)	$	(2,141,655	)
Balance		46,881,475	$	468,815	$	291,570,255	$	(293,980,971	)		3,435,197	$	(199,754	)	$	(2,141,655	)

~~STATEMENTS~~The OFaccompanying ~~SHAREHOLDERS’~~notes ~~EQUITY~~are ~~(DEFICIT)~~an integral part of these financial statements.

	Shares		Stock		Capital		Deficit			Shares		Stock			Equity
										Number
					Additional					of					Total
	Number of		Common		Paid-In		Accumulated			Treasury		Treasury			Shareholders’
	Shares		Stock		Capital		Deficit			Shares		Stock			Equity
Balance, December 31, 2022		46,881,475	$	468,815	$	290,604,327	$	(288,940,510	)		3,435,197	$	(199,754	)	$	1,932,878
Net loss		-		-		-		(4,187,301	)		-		-			(4,187,301	)
Stock-based compensation		-		-		302,890		-								302,890
Balance, December 31, 2023		46,881,475		468,815		290,907,217		(293,127,811	)		3,435,197		(199,754	)		(1,951,533	)
Balance		46,881,475		468,815		290,907,217		(293,127,811	)		3,435,197		(199,754	)		(1,951,533	)
Net loss		-		-		-		(3,233,042	)		-		-			(3,233,042	)
Stock-based compensation		-		-		40,200		-			-		-			40,200
Balance, December 31, 2024		46,881,475	$	468,815	$	290,947,417	$	(296,360,853	)		3,435,197	$	(199,754	)	$	(5,144,375	)
Balance		46,881,475	$	468,815	$	290,947,417	$	(296,360,853	)		3,435,197	$	(199,754	)	$	(5,144,375	)

F-4

~~The~~NOVELSTEM ~~accompanying~~INTERNATIONAL ~~notes are an integral part of these financial statements~~CORP.

~~F-4~~STATEMENTS OF CASH FLOWS

NOVELSTEM INTERNATIONAL CORP.

	2025			2024
	Years Ended
	December 31,
	2025			2024
Cash flows from operating activities:
Net income (loss)	$	2,379,882		$	(3,233,042	)
Adjustments to reconcile net income (loss) to cash used in operating activities:
Equity in net loss of equity method investees		-			161,046
Impairment loss, NewStem		-			1,628,657
Bad debt expense		-			500,000
Accretion of discount on note payable		60,417			177,768
Loss on derivative instrument		-			90,000
Gain on disposal of equity method investment		(1,171,760	)		-
Relief of indebtedness income		(1,697,024	)		-
Accrued interest added to short term notes payable		36,830			-
Accrued interest added to long-term notes payable		136,647			206,999
Accrued interest added to bridge loan payable		9,990			-
Accrued interest added to convertible debt		10,168			8,646
Stock-based compensation		8,838			40,200
Change in operating assets and liabilities:
Accounts receivable, administrative fees		10,500			(10,500	)
Prepaid expenses		(181	)		18,268
Accounts payable		48,060			113,641
Accrued expenses		-			26,353
Net cash used in operating activities		(167,633	)		(271,964	)

Cash flows from investing activities:
Loans made		-			(250,000	)
Net cash used in investing activities		-			(250,000	)

Cash flows from financing activities:
Proceeds from convertible debt	$	-		$	100,000
Proceeds from note payable, current		-			375,000
Proceeds from bridge loan payable		161,867			-
Net cash provided by financing activities		161,867			475,000

Net change in cash		(5,766	)		(46,964	)
Cash at the beginning of the year		6,099			53,063
Cash at the end of the year	$	333		$	6,099

Supplemental cash flow information:
Cash paid during the period for:
Interest	$	2,166		$	1,922
Supplemental Non-Cash Investing and Financing Activities:
Interest capitalized to notes payable	$	36,000		$	-
Settlement of long term notes payable	$	2,997,025		$	-
Settlement of derivative liability, net of interest	$	614,000		$	-

~~STATEMENTS~~The OFaccompanying ~~CASH~~notes ~~FLOWS~~are an integral part of these financial statements.

	2024			2023
	Year Ended
	December 31,
	2024			2023
Cash flows from operating activities:
Net loss	$	(3,233,042	)	$	(4,187,301	)
Equity in net loss of equity method investees		161,046			338,618
Impairment loss, NewStem		1,628,657			-
Gain on dilution of equity method investment		-			(36,139	)
Distribution from NetCo		-			6,875
Bad debt expense		500,000			-
Accretion of discount on note payable		177,768			61,815
Loss on derivative instrument		90,000			260,000
Legal fees and litigation funding fees funded by litigation funding agreement		-			2,819,196
Accrued interest added to long-term note payable		206,999			35,138
Accrued interest added to convertible debt		8,646			-
Stock-based compensation		40,200			302,890
Change in operating assets and liabilities:
Accounts receivable, administrative fees		(10,500	)		12,000
Prepaid expenses		18,268			7,021
Accounts payable		113,641			33,054
Accrued expenses		26,353			(1,450	)
Net cash used in operating activities		(271,964	)		(348,283	)
Cash flows from investing activities:
Loans made		(250,000	)		(250,000	)
Net cash used in investing activities		(250,000	)		(250,000	)
Cash flows from financing activities:
Proceeds from convertible debt	$	100,000		$	-
Proceeds from note payable, current		375,000			250,000
Proceeds from long-term note payable		-			395,000
Net cash provided by financing activities		475,000			645,000
Net (decrease) increase in cash		(46,964	)		46,717
Cash at the beginning of the year		53,063			6,346
Cash at the end of the year	$	6,099		$	53,063
Supplemental cash flow information:
Cash paid during the year for:
Interest	$	1,922		$	1,248
Supplemental Non-Cash Investing and Financing Activities:
Interest added to notes payable and convertible debt	$	215,645		$	35,138

F-5

~~The~~NOVELSTEM ~~accompanying~~INTERNATIONAL ~~notes are an integral part of these financial statements~~CORP.

~~F-5~~Notes to Financial Statements

~~NOVELSTEM~~NOTE ~~INTERNATIONAL~~1—NATURE ~~CORP.~~OF OPERATIONS

~~Notes~~Description toof ~~Financial Statements~~Business

~~NOTE~~NovelStem ~~1—NATURE~~International OFCorp. ~~OPERATIONS~~(“NovelStem” or the “Company”) is a holding company whose principal assets consisted of an approximate 31% equity interest in NewStem Ltd, an Israeli biotech company (“NewStem”) and its developed technology, and a 50% equity interest in NetCo Partners (“NetCo”). The interest in NetCo was sold in May 2025 in a noncash transaction which settled significant debt of the Company in the form of a litigation funding agreement. NovelStem was formerly known as Hollywood Media Corp. The Company was incorporated in the State of Florida on January 22, 1993 and changed its name to NovelStem International Corp. in September 2018.

~~Description~~NewStem focused on the development and commercialization of ~~Business~~diagnostic technology that can predict patients’ anti-cancer drug resistance, allowing for targeted cancer treatments and the potential to reduce resistance to chemotherapy.

~~NovelStem~~NetCo ~~International Corp. (“NovelStem” or the “Company”)~~ is a ~~holding~~legacy ~~company~~media ~~whose~~business ~~principal assets are an approximate 31% equity~~ interest inwhich ~~NewStem~~owns ~~Ltd, an Israeli biotech company (~~“~~NewStem”)~~Net ~~and its developed technology~~Force”, ~~and~~ a ~~50%~~book ~~equity interest~~publishing ~~in NetCo Partners (“NetCo”)~~franchise. ~~NovelStem was formerly known as Hollywood Media Corp. The Company was incorporated in the State of Florida on January 22, 1993 and changed its name to NovelStem International Corp. in September 2018.~~

~~NewStem~~Going ~~focused~~Concern, onLiquidity ~~the development~~ and ~~commercialization of diagnostic technology that can predict patients~~Management’s ~~anti-cancer drug resistance, allowing for targeted cancer treatments and the potential to reduce resistance to chemotherapy.~~Plans

~~NetCo~~Since isinception, the Company has accumulated a ~~legacy~~deficit ~~media~~of approximately $294,000,000. The accumulated deficit of the Company subsequent to its business ~~interest~~focus ~~which~~shift ~~owns~~and ~~“Net~~name ~~Force”~~change in September 2018 is approximately $7,300,000 awhich ~~book~~is ~~publishing~~comprised ~~franchise~~primarily of allocated losses from equity method investments and general and administrative costs incurred by the Company.

~~Going~~The ~~Concern,~~Company ~~Liquidity~~will ~~and~~need to obtain additional funds to continue its operations. Management’s ~~Plans~~plans with regard to these matters include additional financing and fundraising as well as monetization of assets held related to equity method investments as well as potential merger or buyout transactions. Specifically, the Company sold its interest in NetCo to its joint venture partner in a transaction that satisfied the related debt (litigation funding agreement). Also, the Company is working with former NewStem management to monetize the technology of NewStem and has an agreement in place to receive up to $3,750,000 of any monetization of these licenses and related intangible assets. Although management continues to pursue these plans, there is no assurance that the Company will be successful in obtaining sufficient cash from financing on terms acceptable to the Company, or that the Company will realize any value from the retained interest in intangible assets or technology of NewStem, which was liquidated in August 2025 (see Note 3).

~~Since~~The ~~inception, the~~ Company has ~~accumulated~~in place a ~~deficit~~finance ofagreement ~~approximately~~with two individuals who are shareholders and directors under which it borrowed $~~296~~750,000 and an additional finance agreement with a shareholder under which it borrowed $300,000. ~~The~~for ~~accumulated~~working ~~deficit~~capital ofneeds (see Note 4). Additionally, the Company ~~subsequent~~entered ~~to its~~into ~~business~~additional ~~focus~~finance ~~shift~~agreements ~~and~~with ~~name~~unrelated ~~change~~parties in ~~September~~December ~~2018~~2023 isand ~~approximately~~April 2024 under which it borrowed an additional $9450,~~680,~~000 ~~which~~for isworking ~~comprised~~capital ~~primarily~~needs ofand ~~allocated~~to ~~losses~~fund NewStem (see Note 4). All funds available pursuant to these agreements have ~~from~~been ~~equity~~received. ~~method~~During ~~investments~~the ~~and~~year ~~general~~ended ~~and~~December ~~administrative~~31, ~~costs~~2025, ~~incurred~~the byCompany’s executive chairman advanced $161,867 to the Company as an interim bridge loan to fund ongoing expenses. The Company will need to obtain additional funds to continue operations for the next 12 months.

~~The~~On ~~Company~~May ~~will~~9, ~~need~~2025, tothe ~~obtain~~Company ~~additional~~entered ~~funds~~into toa ~~continue~~Settlement ~~its~~Agreement ~~operations. Management’s plans with regard to these matters include additional financing~~ and ~~fundraising~~Release aswhereby ~~well as monetization of assets held related to equity method investments. Specifically,~~ the ~~Company is~~investment in ~~the~~NetCo ~~final~~was ~~stages~~monetized ~~of the process of selling NetCo~~ to ~~its~~settle ~~joint venture partner in a transaction that satisfies~~ the ~~related debt~~ (litigation funding ~~agreement).~~liability ~~Although management continues~~ to ~~pursue~~Omni ~~these~~Bridgeway ~~plans, there is no assurance that the Company will be successful~~ in ~~obtaining~~full. ~~sufficient~~See cash from financing on terms acceptable to the Company, or that the Company will realize any value from the intangible assets or technology of NewStem, which is currently in the process of liquidation due to its inability to raise funds for continued operations (see Note 3)8.

~~The~~In ~~Company~~view ~~has~~of inthe ~~place~~matters adescribed ~~finance~~above, ~~agreement~~the ~~with~~Company’s ~~two~~ability ~~individuals~~to ~~who~~meet ~~are~~financing ~~shareholders~~requirements ~~and~~is ~~directors~~dependent ~~under~~upon ~~which~~the itability ~~borrowed~~to ~~$750,000 and~~complete an additional ~~finance~~fundraising ~~agreement~~or ~~with~~obtain aadditional ~~shareholder~~financing, ~~under~~and/or ~~which~~monetize itthe ~~borrowed~~intangible ~~$300,000~~assets ~~for~~of ~~working~~NewStem. ~~capital~~These ~~needs~~factors, ~~(see~~among ~~Note 4). Additionally~~others, ~~the~~raise ~~Company~~substantial ~~entered~~doubt ~~into~~about ~~additional~~the ~~finance~~Company’s ~~agreements~~ability ~~with~~to ~~unrelated~~continue ~~parties~~as ina ~~December~~going ~~2023~~concern. ~~and~~The ~~April~~financial ~~2024~~statements ~~under~~do ~~which~~not itinclude ~~borrowed~~any anadjustments ~~additional~~relating ~~$450,000~~to ~~for~~the ~~working~~recoverability ~~capital needs~~ and toclassification ~~fund~~of ~~NewStem~~recorded ~~(see~~asset ~~Note~~amounts ~~4).~~or ~~All~~amounts ~~funds~~and ~~available~~classification ~~pursuant~~of toliabilities that ~~these~~might ~~agreements~~be ~~have been~~necessary ~~received.~~should ~~The~~the Company ~~will~~be ~~need~~unable to ~~obtain additional funds to~~ continue ~~operations~~in ~~for the next 12 months~~existence.

In view of the matters described above, the Company’s ability to meet financing requirements is dependent upon the ability to complete additional fundraising or obtain additional financing, and/or monetize its investment in NetCo, along with monetizing intangible assets of NewStem. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.F-6

~~NOTE~~NOVELSTEM ~~2—SUMMARY~~INTERNATIONAL ~~OF SIGNIFICANT ACCOUNTING POLICIES~~CORP.

~~Basis~~Notes ofto ~~Presentation~~Financial Statements

~~The~~NOTE ~~financial~~2—SUMMARY ~~statements~~OF ~~have~~SIGNIFICANT ~~been~~ACCOUNTING prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Financial Accounting Standards Board (“FASB”) has established the FASB Accounting Standards Codification (“ASC”) as the single source of authoritative GAAP.POLICIES

~~F-6~~Basis of Presentation

~~NOVELSTEM~~The ~~INTERNATIONAL~~financial ~~CORP~~statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Financial Accounting Standards Board (“FASB”) has established the FASB Accounting Standards Codification (“ASC”) as the single source of authoritative GAAP.

~~Notes~~Use toof ~~Financial Statements~~Estimates

~~Use~~The preparation of ~~Estimates~~financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

~~The~~Cash ~~preparation of financial statements in conformity with GAAP requires management to make estimates~~ and ~~assumptions~~Cash ~~that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.~~Equivalents

Cash and ~~Cash~~cash ~~Equivalents~~equivalents include certain investments in highly liquid debt instruments with original maturities of three months or less at the date of purchase. The Company had no cash equivalents as of either year end.

~~Cash~~Equity and cash equivalents include certain investments in highly liquid debt instruments with original maturities of three months or less at the date of purchase. The Company had no cash equivalents as of either year end.Investments

Investee companies that are not consolidated, but over which the Company exercises significant influence, are accounted for under the equity method of accounting. Whether or not the Company exercises significant influence with respect to an Investee depends on an evaluation of several factors, including, among others, representation on the Investee company’s board of directors and ownership level, which is generally a 20% to 50% interest in the voting securities of the Investee company. Under the equity method of accounting, an Investee company’s accounts are not reflected within the Company’s Balance Sheets or Statements of Operations; however, the Company’s share of the earnings or losses of the Investee company is reflected in the caption “Equity in net income (loss) of equity method investees” ~~Investments~~in the Statements of Operations. The Company’s carrying value in an equity method Investee company is reflected in the caption “Investment in Investee company” in the Company’s Balance Sheets.

~~Investee~~When ~~companies that are not consolidated, but over which~~ the Company’s ~~exercises~~carrying ~~significant~~value ~~influence,~~in ~~are~~an ~~accounted for under the~~ equity method of ~~accounting.~~Investee ~~Whether~~company oris ~~not~~reduced ~~the Company exercises significant influence with respect~~ to ~~an Investee depends on an evaluation of several factors~~zero, ~~including,~~no ~~among~~further ~~others,~~losses ~~representation~~are onrecorded in the ~~Investee company~~Company’s ~~board of directors and ownership level, which is generally~~ afinancial ~~20%~~statements tounless ~~50% interest in~~ the ~~voting~~Company ~~securities~~guaranteed obligations of the Investee company. ~~Under~~or ~~the~~has ~~equity~~committed ~~method~~additional offunding. ~~accounting,~~When an the Investee company~~’s accounts~~ ~~are~~subsequently ~~not~~reports ~~reflected~~income, ~~within~~ the Company’s ~~Balance~~will ~~Sheets~~not orrecord ~~Statements~~its ~~of Operations; however, the Company’s~~ share of ~~the earnings or losses~~ of ~~the~~such ~~Investee~~income ~~company~~until isit ~~reflected~~equals in the ~~caption~~amount ~~“Equity in net income (loss)~~ of ~~equity method investees”~~its inshare ~~the Statements~~ of ~~Operations.~~losses ~~The~~not ~~Company’s~~previously ~~carrying value in an equity method Investee company is reflected in the caption “Investment in Investee company” in the Company’s Balance Sheets~~recognized.

~~When~~The ~~the~~ Company’s ~~carrying~~reviews ~~value in an~~ equity ~~method~~investments ~~Investee~~for ~~company~~impairment ison ~~reduced~~an toannual ~~zero~~basis, noor ~~further~~earlier ~~losses~~if ~~are~~events ~~recorded in the Company’s financial statements unless the Company guarantied obligations of the Investee company~~ or ~~has~~changes ~~committed~~in ~~additional~~circumstances ~~funding.~~indicate ~~When the~~that ~~Investee company subsequently reports income,~~ the ~~Company~~carrying ~~will~~amounts ~~not~~might ~~record its share of such income until it equals the amount of its share of losses~~ not ~~previously~~be ~~recognized~~recoverable.

The Company ~~reviews~~held ~~equity~~a ~~investments~~minority investment in an entity, NewStem, which was accounted for ~~impairment~~pursuant onto anthe ~~annual~~equity ~~basis~~method of accounting until its dissolution in August 2025. Additionally, oruntil ~~earlier~~May if9, ~~events~~2025 orthe ~~changes~~Company was a 50% joint venture partner in ~~circumstances~~NetCo ~~indicate~~which ~~that~~was accounted for pursuant to the ~~carrying~~equity ~~amounts~~method ~~might~~of ~~not~~accounting. beSee ~~recoverable~~Note 3.

The Company holds a minority investment in an entity, NewStem, which is accounted for pursuant to the equity method of accounting. Additionally, the Company is a 50% joint venture partner in NetCo which is accounted for pursuant to the equity method of accounting. See Note 3.Reclassifications

~~Derivative~~Accrued ~~Financial~~interest ~~Instruments~~of $30,903 has been reclassified from accrued expenses on the balance sheet to be presented as part of the related notes payable balance as of December 31, 2025.

The Company has in place a financial instrument, in the form of a note payable, with an identified embedded derivative in the form of a guarantee. The identified embedded derivative has been bifurcated and accounted for separately. Such derivative financial instruments are measured at fair value at each financial statement reporting date. If the fair value of a financial liability (the derivative) exceeds the proceeds received for the issuance of a hybrid instrument in an arm’s length transaction with no rights or privileges that require separate accounting recognition as an asset identified, then the embedded derivative is recorded at fair value with the excess of fair value over proceeds recognized as a loss in earnings. During the years ended December 31, 2024 and 2023, the Company recognized a loss on derivative financial instruments of $90,000 and $260,000, respectively. Proceeds from the note payable are shown as cash from financing instruments and the loss on derivative instrument is included as an adjustment to reconcile loss to net cash used in operating activities in the statements of cash flows for the years ended December 31, 2024 and 2023.F-7

~~Treasury~~NOVELSTEM ~~Stock~~INTERNATIONAL CORP.

~~Shares~~Notes ofto ~~common~~Financial ~~stock repurchased are recorded at cost as treasury stock.~~Statements

~~F-7~~Derivative Financial Instruments

~~NOVELSTEM~~The ~~INTERNATIONAL~~Company ~~CORP~~had in place a financial instrument, in the form of a note payable, which included an identified embedded derivative in the form of a guarantee. The identified embedded derivative was bifurcated and accounted for separately. Such derivative financial instruments are measured at fair value at each financial statement reporting date. If the fair value of a financial liability (the derivative) exceeds the proceeds received for the issuance of a hybrid instrument in an arm’s length transaction with no rights or privileges that require separate accounting recognition as an asset identified, then the embedded derivative is recorded at fair value with the excess of fair value over proceeds recognized as a loss in earnings. During the year ended December 31, 2024, the Company recognized a loss on derivative financial instruments of $90,000. Proceeds from the note payable are shown as cash from financing instruments and the loss on derivative instrument is included as an adjustment to reconcile loss to net cash used in operating activities in the statements of cash flows for the years ended December 31, 2025 and 2024. The financial instrument was amended on May 16, 2025 to remove the guarantee and replace the guarantee with fixed interest of $36,000 through September 30, 2025. This amendment terminated the embedded derivative and pursuant to ASC 470 for troubled debt restructuring with a related party. The Company recognized a gain on derivative financial instruments of $650,000 net of interest expense of $36,000 as an equity transaction for troubled debt restructuring during the year ended December 31, 2025.

~~Notes~~Treasury ~~to Financial Statements~~Stock

~~Stock-Based~~Shares ~~Compensation~~of common stock repurchased are recorded at cost as treasury stock.

~~The Company accounts for stock~~Stock-~~based awards in accordance with applicable accounting principles, which requires compensation expense related~~Based to share-based transactions to be measured and recognized in the financial statements based on a determination of the fair value of the stock options. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For all stock options, the Company recognizes expense on an accelerated basis over the requisite service period (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense.Compensation

~~Options~~The ~~awarded~~Company toaccounts ~~purchase~~for ~~shares~~stock-based ofawards ~~common~~in ~~stock~~accordance ~~issued~~with applicable accounting principles, which require compensation expense related to ~~non~~share-~~employees~~based transactions to be measured and recognized in ~~exchange~~the ~~for~~financial ~~services~~statements ~~are~~based ~~accounted~~on ~~for~~a asdetermination ~~variable~~of ~~awards~~the infair ~~accordance with~~value ~~applicable~~of ~~accounting~~the stock ~~principles~~options. ~~Such~~The ~~options~~grant ~~are~~date ~~valued~~fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For all stock options, the Company recognizes expense on an accelerated basis over the requisite service period (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense.

InOptions ~~the~~awarded ~~event~~to ofpurchase ~~the~~shares ~~termination~~ of ancommon ~~employee,~~stock ~~third~~issued ~~party~~to ~~service~~non-employees ~~provider,~~in ~~officer~~exchange ~~or Director’s service on the Board of the Company~~ for ~~any~~services ~~reason~~are ~~other~~accounted ~~than~~ for ~~cause,~~as ~~all~~variable ofawards ~~the options which are then vested may be exercised within 18 months of such termination, provided that,~~ in ~~no event shall this extension period continue beyond the expiration of the term of the option(s). In addition, any~~accordance ~~such~~with ~~extension shall be~~ applicable ~~only~~accounting ~~to the extent that such option or options are vested and exercisable according to the terms of the Plan and this Agreement~~principles. ~~Any~~Such ~~unvested~~ options are ~~immediately~~valued ~~terminated~~using on the ~~effective~~Black-Scholes ~~date~~option ofpricing ~~the termination~~model. In the event of termination of an employee, third party service provider, officer or Director’s service for cause, all options are forfeited and deemed cancelled and no longer exercisable on the date of termination.

~~See~~In ~~Note~~the 5event of the termination of an employee, third party service provider, officer or Director’s service on the Board of the Company for any reason other than for cause, all of the ~~assumptions~~options ~~used~~which toare ~~calculate~~then vested may be exercised within 18 months of such termination, provided that, in no event shall this extension period continue beyond the ~~fair~~expiration ~~value~~of the term of ~~stock-based~~the ~~compensation~~option(s). ~~Upon~~In addition, any such extension shall be applicable only to the ~~exercise~~extent that such option or options are vested and exercisable according to the terms of the Plan and this Agreement. Any unvested options, itare isimmediately terminated on the ~~Company~~effective date of the termination. In the event of termination of an employee, third party service provider, officer or Director’s service for cause, all options are forfeited and ~~policy~~deemed tocancelled ~~issue~~and ~~new~~no ~~shares~~longer ~~rather~~exercisable ~~than~~on ~~utilizing~~the ~~treasury~~date ~~shares~~of termination.

~~Income~~See ~~Taxes~~Note 5 for the assumptions used to calculate the fair value of stock-based compensation. Upon the exercise of options, it is the Company’s policy to issue new shares rather than utilizing treasury shares.

Deferred income taxes are determined using the asset and liability method in accordance with Accounting Standards Codification (“ASC”) Topic 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income taxes are measured using enacted tax rates expected to apply to taxable income in years in which such temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred income taxes is recognized in the statement of operations of the period that includes the enactment date. In addition, a valuation allowance is established to reduce any deferred tax asset for which it is determined that it is more likely than not that some portion of the deferred tax asset will not be realized.F-8

~~Basic~~NOVELSTEM ~~and~~INTERNATIONAL ~~Diluted Net Loss Per Share~~CORP.

~~Basic~~Notes ~~net~~to ~~income~~Financial per share is computed by dividing the net income by the weighted average number of shares outstanding during the year, excluding treasury stock. Diluted net income per share is computed by dividing the net income by the weighted average number of shares outstanding plus the dilutive potential of common shares which would result from the exercise of stock options and warrants. The dilutive effects of stock options and warrants are excluded from the computation of diluted net income per share if the effect of doing so would be antidilutive.Statements

~~F-8~~Income Taxes

~~NOVELSTEM~~Deferred ~~INTERNATIONAL~~income ~~CORP~~taxes are determined using the asset and liability method in accordance with Accounting Standards Codification (“ASC”) Topic 740. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income taxes are measured using enacted tax rates expected to apply to taxable income in years in which such temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred income taxes is recognized in the statement of operations of the period that includes the enactment date. In addition, a valuation allowance is established to reduce any deferred tax asset for which it is determined that it is more likely than not that some portion of the deferred tax asset will not be realized.

~~Notes~~Basic toand ~~Financial~~Diluted ~~Statements~~Net Income (Loss) Per Share

~~The~~Basic ~~following~~net ~~data~~income ~~represents~~(loss) per share is computed by dividing the ~~amounts~~net ~~used~~income in(loss) ~~computing~~by ~~earnings~~the ~~per~~weighted ~~share~~average ~~and~~number of shares outstanding during the ~~effect~~period, onexcluding treasury stock. Diluted net income (loss) ~~and~~per share is computed by dividing the net income (loss) by the weighted average number of shares ofoutstanding plus the dilutive potential of common shares which would result from the exercise of stock: options and warrants. The dilutive effects of stock options and warrants are excluded from the computation of diluted net income (loss) per share if the effect of doing so would be antidilutive.

~~SCHEDULE~~The following OFdata ~~WEIGHTED~~represents ~~AVERAGE~~the ~~NUMBER~~amounts OFused ~~SHARES~~in OFcomputing ~~DILUTIVE~~earnings per share and the effect on net income (loss) and the weighted average number of shares of dilutive potential common stock:

	2024			2023
	Year Ended December 31,
	2024			2023
Net loss available to common shareholders	$	(3,233,042	)	$	(4,187,301	)
Weighted average shares outstanding:
-Basic		46,881,475			46,881,475
Add: Warrants		-			-
Add: Stock options		-			-
-Diluted		46,881,475			46,881,475
Basic and diluted net loss per share	$	(0.07	)	$	(0.09	)

NOTE 3—EQUITY METHOD INVESTMENTS

	2025		2024
	Year Ended December 31,
	2025		2024

Net income (loss) available to common shareholders	$	2,379,882	$	(3,233,042	)

Weighted average shares outstanding:
-Basic		46,881,475		46,881,475

Basic net income (loss) per share	$	0.05	$	(0.07	)

Net income (loss) attributable to common shareholders	$	2,379,882	$	(3,233,042	)
Effect of dilutive securities:
Convertible debt, interest		10,169		-

Net income (loss) attributable to common shareholders	$	2,390,051	$	(3,233,042	)

Weighted average shares outstanding:
-Basic		46,881,475		46,881,475
Add: Convertible Debt		913,962		-
Add: Stock options		-		-
-Diluted		47,795,437		46,881,475

Diluted net income (loss) per share	$	0.05	$	(0.07	)

~~Investment in NewStem~~F-9

InNOVELSTEM ~~2018,~~INTERNATIONAL ~~the Company entered into a Share Purchase Agreement with NewStem and other related parties to provide aggregate funding of up to $4,000,000 to NewStem~~CORP. This funding was to be provided through the sale of up to 50,000 common shares of NewStem to the Company representing 33% of New Stem’s outstanding shares. In 2018, the Company purchased 25,000 shares of NewStem for $2,000,000 acquiring an ownership interest of 20%. The Company made additional investments in 2019 and 2020 purchasing 12,500 shares each year for a $1,000,000 investment each year resulting in an ownership interest of 30.51% and 30.58%, respectively, as of December 31, 2024 and 2023.

~~The~~Notes Company accounts for its investment in NewStem under the equity method. At December 31, 2023, the carrying value of the investment in NewStem exceeded its portion of the underlying net assets of NewStem by approximately $1,800,000. The excess related to ~~identified~~Financial ~~intangible assets including license agreements, specialized work force (goodwill) and two separate projects of in process research and development (“IPR&D”).~~Statements

~~NewStem is~~Common astock ~~development~~equivalents ~~stage~~excluded ~~company~~from ~~and~~the ~~has~~computation ~~incurred~~of ~~losses~~earnings ~~since~~per ~~its~~share ~~inception~~for ~~and~~the ~~has~~years ~~generated only minimal revenues under a licensing agreement.~~ended:

~~The Company~~SCHEDULE ~~assesses~~OF ~~its~~OPTIONS ~~investment~~AND inWARRANTS ~~NewStem~~EXCLUDED ~~for impairment on an annual basis or more frequently if indicators of impairment exist. During~~FROM COMPUTATION ~~the~~OF ~~year~~EARNINGS ~~ended~~PER December 31, 2024 indicators of impairment became evident due to the inability of NewStem to raise funds. Due to the inability to raise funds, NewStem has been unable to continue operations and is in the process of liquidation. The intangible assets of NewStem, including license agreements, have reverted to the licensor, Yissum (the commercial division of Hebrew University). The Company has reached an agreement with Yissum regarding the potential monetization of these intangible assets which provides for funds to be received by the Company in the event of re-licensing or monetizing of the licenses or related technology developed by NewStem. Due to the current uncertainty of the recovery of any value from these intangible assets and the liquidation status of NewStem, the Company has fully impaired the investment in NewStem and reduced the carrying value to zero ($0) at December 31, 2024, recognizing an impairment loss of $1,628,657 during the year ended December 31, 2024.SHARE

F-9

	2025		2024
	Year Ended December 31,
	2025		2024
Warrants		-		3,000,000
Stock options		6,060,000		6,210,411
Convertible debt		-		827,323
Anti-dilutive securities		-		827,323

~~NOVELSTEM INTERNATIONAL~~Recently ~~CORP.~~Adopted Accounting Standards

~~Notes~~In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to ~~Financial~~Income ~~Statements~~Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision usefulness of income tax disclosures. The Company adopted ASU 2023-09 for the current year and has elected to apply the standard on a prospective basis.

~~The~~NOTE ~~Company~~3—EQUITY ~~signed~~METHOD anINVESTMENTS agreement (the “Purchase Agreement”) to acquire the remainder of NewStem in exchange for shares of Company stock as well as funding for NewStem operations. In anticipation of this transaction, the Company advanced $250,000 to NewStem in December 2023 and an additional $250,000 in March 2024. The related note agreement bears no interest and was payable on December 30, 2024. The agreement provided for discharge of the note upon the closing of the anticipated acquisition transaction. The Purchase Agreement was not fully consummated, and no Company shares were issued to NewStem shareholders in exchange for NewStem shares, therefore the note was not discharged. The Company determined that collection of the note was unlikely due to NewStem’s liquidation status and lack of assets. As such, the Company wrote the note off as a bad debt during the year ended December 31, 2024.

~~During~~Investment ~~the~~in ~~year ended December 31, 2024, the Company recorded a reimbursement due to~~ NewStem of approximately $42,000 for audit and accounting related costs which was offset against the note receivable from NewStem. During the year ended December 31, 2023, the Company reimbursed NewStem for audit and audit related costs of approximately $58,000.

~~The~~In ~~following~~2018, ~~table~~the ~~represents~~Company entered into a Share Purchase Agreement with NewStem and other related parties to provide aggregate funding of up to $4,000,000 to NewStem. This funding was to be provided through the sale of up to 50,000 common shares of NewStem to the Company representing 33% of NewStem’s outstanding shares. In 2018, the Company purchased 25,000 shares of NewStem for $2,000,000 acquiring an ownership interest of 20%. The Company made additional investments in 2019 and 2020 purchasing 12,500 shares each year for a $1,000,000 investment each year resulting in ~~NewStem:~~an ownership interest of 30.51% as of December 31, 2024 and until its liquidation in August 2025.

~~SCHEDULE~~The Company OFaccounted ~~INVESTMENTS~~for its investment in NewStem under the equity method.

	2024			2023
	Year Ended December 31,
	2024			2023
Investment in NewStem, beginning	$	1,784,234		$	2,090,286
Allocation of net loss from NewStem		(155,577	)		(342,191	)
Gain on dilution of equity method investment		-			36,139
Investment in NewStem before impairment		1,628,657			1,784,234
Impairment loss recorded		(1,628,657	)		-
Investment in NewStem, ending	$	-		$	1,784,234

NewStem was a development stage company which incurred losses since its inception and generated only minimal revenues under a licensing agreement. NewStem was liquidated in August 2025.

~~The~~During ~~results~~the year ended December 31, 2024, the Company signed an agreement (the “Purchase Agreement”) to acquire the remainder of NewStem in exchange for shares of Company stock as well as funding for NewStem operations. In anticipation of this transaction, the Company advanced $250,000 to NewStem in December 2023 and ~~financial~~an ~~position~~additional $250,000 in March 2024. The related note agreement bore no interest and was payable on December 30, 2024. The agreement provided for discharge of the note upon the closing of the anticipated acquisition transaction. The Purchase Agreement was not fully consummated, and no Company’s ~~investment~~shares were issued to NewStem shareholders in exchange for NewStem ~~are~~shares, therefore ~~summarized~~the ~~below:~~note was not discharged. The Company determined that collection of the note was unlikely due to NewStem’s liquidation status and lack of assets. As such, the Company wrote the note off as a bad debt during the year ended December 31, 2024.

~~SCHEDULE~~The Company OFassessed ~~OPERATIONS~~its ~~AND~~investment ~~FINANCIAL~~in ~~POSITION~~NewStem ~~INVESTMENT~~for impairment on an annual basis or more frequently if indicators of impairment exist. During the year ended December 31, 2024, indicators of impairment became evident due to the inability of NewStem to raise funds. Due to the inability to raise funds, NewStem was unable to continue operations and dissolved in August 2025. The intangible assets of NewStem, including license agreements, have reverted to the licensor, Yissum (the commercial division of Hebrew University). The Company has reached an agreement with Yissum regarding the potential monetization of these intangible assets which provides for the Company to receive up to $3,750,000 in the event of re-licensing or monetizing the licenses or related technology developed by NewStem. Due to the current uncertainty of the timing of recovery of any value from these intangible assets and the liquidation status of NewStem, the Company fully impaired the investment in NewStem and reduced the carrying value to zero ($0) at December 31, 2024. On August 14, 2025, the Company received $5,432 from NewStem upon the final closing of their accounts which was recorded as a reduction of the previously recognized impairment loss in the condensed statements of operations for the year ended December 31, 2025. In October 2025, the Company wrote off all asset accounts and the related impairment and ceased accounting for NewStem.

	2024			2023
	Year Ended December 31,
	2024			2023
Condensed income statement information:
License fees	$	-		$	95,000
Gross margin	$	-		$	84,000
Net loss	$	(510,000	)	$	(1,119,000	)
Company’s allocation of net loss from NewStem	$	(155,577	)	$	(155,577	)

F-10

	2024		2023
	As of December 31,
	2024		2023
Condensed balance sheet information:
Current assets	$	100,000	$	353,000
Non-current assets	$	2,000	$	9,000
Current liabilities	$	548,000	$	284,000
Non-current liabilities	$	-	$	-

NOVELSTEM INTERNATIONAL CORP.

~~F-10~~Notes to Financial Statements

~~NOVELSTEM~~During ~~INTERNATIONAL~~the ~~CORP~~year ended December 31, 2024, the Company recorded a reimbursement due to NewStem of approximately $42,000 for audit and accounting related costs which was offset against the note receivable from NewStem. No such reimbursements were made during the year ended December 31, 2025.

~~Notes~~The tofollowing ~~Financial~~table ~~Statements~~represents the Company’s investment in NewStem:

~~Investment in~~ SCHEDULE ~~NetCo~~OF INVESTMENTS

NovelStem owns a 50% interest in NetCo, a joint venture that owns the Net Force publishing franchise. The Company accounts for its investment in NetCo under the equity method and recognizes nominal royalties and administrative fees from this arrangement. The Company assesses its investment in NetCo for impairment on an annual basis or more frequently if indicators of impairment exist.

	2025		2024
	Year Ended December 31,
	2025		2024

Investment in NewStem, beginning	$	-	$	1,784,234
Allocation of net loss from NewStem		-		(155,577	)
Investment in NewStem before impairment		-		1,628,657
Impairment loss recorded		-		(1,628,657	)
Investment in NewStem, ending	$	-	$	-

The ~~following~~results ~~table~~of ~~represents~~operations and financial position of the Company’s investment in ~~NetCo~~NewStem are summarized below:

SCHEDULE OF ~~INVESTMENTS~~OPERATIONS AND FINANCIAL POSITION INVESTMENT

	2024			2023
	2025			2024
	Year Ended December 31,
	2024			2023
	2025			2024
Investment in NetCo, beginning	$	133,709		$	137,011
Condensed income statement information:
Allocation of net income (loss) from Netco		(5,469	)		3,573
Net revenues	$	-		$	-
Distribution from NetCo		-			(6,875	)
Gross margin	$	-		$	-
Investment in NetCo, ending	$	128,240		$	133,709
Net loss	$	-		$	(510,000	)
Company’s allocation of net loss from NewStem	$	-		$	(155,577	)

The results of operations and financial position of the Company’s investment in NetCo are summarized below:

	2025		2024
	As of December 31,
	2025		2024
Condensed balance sheet information:
Current assets	$	-	$	100,000
Non-current assets	$	-	$	2,000
Current liabilities	$	-	$	548,000
Non-current liabilities	$	-	$	-

~~SCHEDULE~~Investment in ~~OF OPERATIONS AND FINANCIAL POSITION INVESTMENT~~NetCo

	2024			2023
	Year Ended December 31,
	2024			2023
Condensed income statement information:
Net sales	$	1,479		$	25,789
Gross margin	$	1,362		$	19,422
Net income (loss)	$	(10,938	)	$	7,146
Company’s allocation of net income from NetCo	$	(5,469	)	$	3,573

As of December 31, 2024, NovelStem owned a 50% interest in NetCo, a joint venture that owns the Net Force publishing franchise. On May 9, 2025, the Company entered into a Settlement Agreement and Release whereby the investment in NetCo was sold to the Company’s JV partner for $1,300,000 to settle the related litigation funding liability to Omni Bridgeway in full. This transaction was fully consummated as funds were received by Omni Bridgeway from CP Partners pursuant to the terms of the agreement.

	2024		2023
	As of December 31,
	2024		2023
Condensed balance sheet information:
Current assets	$	1,305	$	13,473
Non-current assets	$	272,799	$	272,799
Current liabilities	$	10,748	$	12,250
Non-current liabilities	$	-	$	-

F-11

~~NOTE~~NOVELSTEM ~~4—NOTES~~INTERNATIONAL ~~PAYABLE~~CORP.

InNotes December 2023, the Company entered into two short term notes payable with unrelated parties, Hewlett Fund and AIGH Investment Partners, LLC. The notes are for $125,000 each, for a total of $250,000 in borrowings utilized for the funding of NewStem. The notes bear interest at 12% per annum and originally matured on December 21, 2024. The maturity date for both notes has been extended until December 21, 2025 at which time all principal and accrued interest are due and payable. The note agreements include a provision whereby, in the event of a capital raise transaction by the Company, the note holders would be entitled to ~~participate~~Financial in the transaction in an amount equal to 133% of the amounts owed on the note agreements at the closing of the transaction. Interest expense related to these notes was $30,082 and $822, respectively, for the years ended December 31, 2024 and 2023.Statements

~~F-11~~The Company accounted for its investment in NetCo under the equity method and recognized nominal royalties and administrative fees from this arrangement. The Company assessed its investment in NetCo for impairment on an annual basis or more frequently if indicators of impairment existed.

~~NOVELSTEM~~The ~~INTERNATIONAL~~following ~~CORP.~~table represents the Company’s investment in NetCo:

~~Notes to~~ SCHEDULE ~~Financial~~OF ~~Statements~~INVESTMENTS

Long-term notes payable are summarized as follows:

	2025			2024
	Year Ended December 31,
	2025			2024
Investment in NetCo, beginning	$	128,240		$	133,709
Allocation of net income (loss) from Netco		640			(5,469	)
Distribution from NetCo		(640	)		-
Sale of ownership interest in NetCo		(128,240	)		-
Investment in NetCo, ending	$	-		$	128,240

~~SCHEDULE~~The results OFof ~~LONG~~operations ~~TERM~~and ~~NOTES~~financial ~~PAYABLE~~position of the Company’s investment in NetCo are summarized below:

	As of December 31,
	2024			2023
Notes payable related parties:
Notes payable director and Executive Chairman	$	821,766		$	400,000
Accrued interest added to note balance		38,392			43,588
Total notes payable director and Executive Chairman		860,158			443,588
Note payable shareholder, principal amount		300,000			275,000
Less unamortized discount		(60,417	)		(213,185	)
Total note payable shareholder		239,583			61,815
Note payable, litigation funding agreement:
Note payable Omni Bridgeway (Fund 4) Invt. 3 L.P.		2,819,196			2,819,196
Accrued interest added to agreement balance		140,429			-
Total note payable, litigation funding agreement		2,959,625			2,819,196
Total notes payable		4,059,366			3,324,599
Less current portion		(4,059,366	)		-
Long-term notes payable	$	-		$	3,324,599

During the year ended December 31, 2022, the Company entered into note agreements with Jan Loeb, our Executive Chairman and Jerry Wolasky, a shareholder and member of the Board, to borrow up to an aggregate of $600,000 for working capital needs. The note agreements were amended in March 2024 to increase the total borrowing to $650,000 and extend the maturity date. The note agreements were refinanced in August 2024 providing for total borrowings of $750,000. The agreements provide for interest at a rate of 10% per annum and mature December 31, 2025. As of the date of financial statements, the full amount of $750,000 has been funded pursuant to these agreements.

	2025		2024
	Year Ended December 31,
	2025		2024
Condensed income statement information:
Net sales	$	1,280	$	1,479
Gross margin	$	1,280	$	1,362
Net income (loss)	$	1,280	$	(10,938	)
Company’s allocation of net income (loss) from NetCo	$	640	$	(5,469	)

On May 5, 2023, the Company entered into a long term note payable with a shareholder for $300,000 in financing to be funded $150,000 at inception and $150,000 in October 2023. This note bears interest at zero percent (0%) and matures on May 5, 2025. The note includes a guarantee which has been identified as an embedded derivative with a fair value of a liability of $650,000 and $535,000 at December 31, 2024 and 2023, respectively, which is reported separately on the balance sheet. The fair value of the note exceeds the proceeds, and the note has been discounted at inception so that the net liability is the fair value of the derivative. Accretion of the note discount of $66,570 and $61,815, respectively, has been reflected as part of interest expense in the statement of operations for year ended December 31, 2024 and 2023.

	2025		2024
	As of December 31,
	2025		2024
Condensed balance sheet information:
Current assets	$	-	$	1,305
Non-current assets	$	-	$	272,799
Current liabilities	$	-	$	10,748
Non-current liabilities	$	-	$	-

F-12

NOVELSTEM INTERNATIONAL CORP.

Notes to Financial Statements

~~Note~~NOTE ~~Payable,~~4—NOTES ~~Litigation Funding Agreement~~PAYABLE

OnIn ~~February~~December 112023, ~~2022,~~ the Company entered into atwo ~~nonrecourse~~short ~~litigation~~term ~~funding~~notes ~~agreement~~payable ~~(the~~with ~~“Agreement”)~~unrelated ~~with~~parties, ~~Omni~~Hewlett ~~Bridgeway (~~Fund 4)and ~~Invt.~~AIGH 3Investment LPartners, LLC.P. ~~(“Omni”)~~The ~~related~~notes toare anfor ~~arbitration~~$125,000 ~~proceeding~~each, ~~disclosed~~for a total of $250,000 in ~~Note~~borrowings 7utilized for the funding of NewStem. The ~~Agreement~~notes ~~provides~~bear ~~for Omni~~interest toat ~~fund~~12% ~~all~~per ~~costs~~annum ~~related~~and tooriginally ~~the~~matured ~~arbitration~~on upDecember ~~to $1~~21,~~000,000~~ in2024. ~~exchange~~The maturity date for anboth ~~assignment~~notes ofhas abeen ~~certain~~extended ~~portion~~until ofJune ~~rights~~30, to2026 at which time all principal and accrued interest in ~~claims~~are ~~related~~due toand ~~this arbitration~~payable. The ~~agreement~~note ~~provides~~agreements ~~for~~include ~~specific~~a ~~calculations~~provision ofwhereby, in the ~~portion~~event of a ~~any~~capital ~~claims~~raise ~~collected~~transaction ~~to be received~~ by ~~Omni~~the ~~with~~Company, the ~~remainder~~note ~~collectible~~holders bywould ~~the~~be ~~Company.~~entitled ~~Additionally,~~to ~~the~~participate ~~agreement~~in ~~provides~~the ~~for~~transaction ~~repayment~~in ofan ~~funded~~amount ~~costs~~equal ~~pursuant~~ to 133% of the ~~same~~amounts ~~multiple~~owed ~~calculations~~on inthe note agreements at the ~~event~~closing of athe ~~favorable~~transaction. ~~outcome~~Interest ~~that~~expense ~~does~~related ~~not~~to ~~include~~these notes was $36,830 and $30,082, respectively, for the ~~collection~~years ofended ~~claims~~December 31, 2025 and 2024.

~~During~~Long-term ~~July~~notes ~~2023,~~payable ~~the~~are ~~arbitration~~summarized ~~was settled. As a result of the ruling disclosed in Note 7, the liability became probable and reasonably estimable, and the Company recorded the full liability due to Omni~~ as of December 31, 2023. This liability consists of expenses funded by Omni of $933,065, including $310,000 advanced for working capital, and related fees or investment return to Omni calculated as contractual multiples of funding totaling $1,886,131 as of December 31, 2023 for a total liability of $2,819,196. This agreement bears interest at 5% per annum beginning January 2024 and is payable on January 10, 2025. The Company accrued interest related to the Agreement of $140,428 during the year ended December 31, 2024.follows:

~~Convertible Debt~~ SCHEDULE OF LONG TERM NOTES PAYABLE

In April 2024, the Company borrowed $100,000 from unrelated parties pursuant to convertible debt agreements accounted for as debt. These agreements bear interest at 10% per annum and mature December 30, 2025. The unpaid principal balance of these notes and any accrued interest may be converted into shares of the Company’s common stock at a conversion price of $0.13 per share. Interest accrued related to these agreements was $8,646 during the year ended December 31, 2024.

	As of December 31,
	2025			2024
Notes payable related parties:
Notes payable director and Executive Chairman	$	821,766		$	821,766
Accrued interest added to note balance		129,208			38,392
Total notes payable director and Executive Chairman		950,974			860,158
Note payable shareholder, principal amount		300,000			300,000
Accrued interest added to note balance		44,431			-
Less unamortized discount		-			(60,417	)
Total note payable shareholder		344,431			239,583
Note payable, litigation funding agreement:
Note payable Omni Bridgeway (Fund 4) Invt. 3 L.P.		-			2,819,196
Accrued interest added to agreement balance		-			140,429
Total note payable, litigation funding agreement		-			2,959,625
Total notes payable		1,295,405			4,059,366
Less current portion		(1,295,405	)		(4,059,366	)
Long-term notes payable	$	-		$	-

~~NOTE~~During ~~5—EQUITY~~the year ended December 31, 2022, the Company entered into note agreements with Jan Loeb, our Executive Chairman and Jerry Wolasky, a shareholder and member of the Board, to borrow up to an aggregate of $600,000 for working capital needs. The note agreements were amended in March 2024 to increase the total borrowing to $650,000 and extend the maturity date. The note agreements were refinanced in August 2024 providing for total borrowings of $750,000. The agreements provide for interest at a rate of 10% per annum and matured December 31, 2025. As of the date of financial statements, the full amount of $750,000 has been funded pursuant to these agreements and the maturity date has been extended to June 30, 2026. Interest expense related to these notes was $90,816 and $66,570, respectively, for the years ended December 31, 2025 and 2024.

(On May 5, 2023, the Company entered into a long-term note payable with a shareholder for $300,000 in financing to be funded $150,000 at inception and $150,000 in October 2023. This note bore interest at zero percent (0%) ~~General~~and originally matured on May 5, 2025. The note included a guarantee which was identified as an embedded derivative with a fair value of a liability of $650,000 at December 31, 2024 which is reported separately on the balance sheet. The fair value of the note exceeded the proceeds, and the note was discounted at inception so that the net liability was the fair value of the derivative. Accretion of the note discount of $60,417 and $177,768, respectively, is included in interest expense in the statement of operations for the years ended December 31, 2025 and 2024. This note agreement was restructured during 2025 to provide for a fixed amount of interest in lieu of the guarantee. This amendment, which was determined to be accounted for pursuant to the provisions of ASC 470 for troubled debt restructurings with related parties, ended the discounting of the note and the separate recording of an embedded derivative, as the note now bears interest and contains no identifiable embedded derivative. As such, the relief of the guarantee was recorded as an adjustment to equity in the accompanying financial statements and interest expense of $36,000 was accrued and treated as a reduction to equity. Beginning October 1, 2025, the note began to bear interest at a rate of 10% per annum and $8,431 of interest expense was accrued during the year ended December 31, 2025. The note matures December 31, 2026.

At December 31, 2024 and 2023 the Company had issued 50,316,672 shares and had issued and outstanding 46,881,475 shares of its common stock, par value $0.01 per share. The Company held 3,435,197 shares of its common stock, $0.01 par value, in treasury at December 31, 2024 and 2023. Holders of outstanding common stock are entitled to receive dividends when, and if declared by the Board and to share ratably in the assets of the Company legally available for distribution in the event of a liquidation, dissolution or winding up of the Company.F-13

~~(b)~~NOVELSTEM ~~Summary~~INTERNATIONAL ~~Employee Option Information~~CORP.

~~The~~Notes ~~Company’s stock option plans provide for the grant~~ to ~~officers,~~Financial directors, third party contractors and other future key employees of options to purchase shares of common stock. The purchase price may be paid in cash or at the end of the option term, if the option is “in-the-money”, it is automatically exercised “net”. In a net exercise of an option, the Company does not require a payment of the exercise price of the option from the optionee but reduces the number of shares of common stock issued upon the exercise of the option by the smallest number of whole shares that has an aggregate fair market value equal to or in excess of the aggregate exercise price for the option shares covered by the option exercised. Each option is exercisable to one share of the Company’s common stock. Most options expire within six years from the date of the grant and generally vest on the first anniversary date of their issuance. Pursuant to the Equity Incentive Plan approved by the Company’s board of directors on November 12, 2018, an aggregate of 6,360,000 options have been issued to directors and investor relations professionals.Statements

~~F-13~~Note Payable, Litigation Funding Agreement

~~NOVELSTEM~~On ~~INTERNATIONAL~~February ~~CORP~~11, 2022, the Company entered into a nonrecourse litigation funding agreement (the “Agreement”) with Omni Bridgeway (Fund 4) Invt. 3 L.P. (“Omni”) related to an arbitration proceeding disclosed in Note 7. The Agreement provided for Omni to fund all costs related to the arbitration up to $1,000,000 in exchange for an assignment of a certain portion of rights to and interest in claims related to this arbitration. The agreement provided for specific calculations of the portion of any claims collected to be received by Omni with the remainder collectible by the Company. Additionally, the agreement provided for repayment of funded costs pursuant to the same multiple calculations in the event of a favorable outcome that does not include the collection of claims.

~~Notes~~During July 2023, the arbitration was settled. As a result of the ruling disclosed in Note 7, the liability became probable and reasonably estimable, and the Company recorded the full liability due to ~~Financial~~Omni ~~Statements~~as of December 31, 2023. This liability consists of expenses funded by Omni of $933,065, including $310,000 advanced for working capital, and related fees to Omni calculated as contractual multiples of funding totaling $1,886,131 for a total liability of $2,819,196. This agreement bore interest at 5% per annum beginning January 2024 and was payable in full on January 10, 2025. The Company accrued interest related to the Agreement of $37,400 and $140,429, respectively, during the years ended December 31, 2025 and 2024.

The Company ~~utilized~~began ~~the~~negotiations ~~Black-Scholes~~for ~~option-pricing~~settlement ~~model~~of tothis ~~estimate~~Agreement ~~fair~~during ~~value~~2024 and on May 9, ~~utilizing~~2025, the ~~following~~Company ~~assumptions~~entered into a Settlement Agreement and Release with our JV partner in NetCo, C.P. Group, and Omni whereby our interest in NetCo was sold in exchange for ~~the~~funds ~~respective~~of $1,300,000 ~~years~~which (were paid directly to Omni by CP Group in full settlement and release of all liabilities related to the Litigation Funding Agreement. This transaction resulted in ~~weighted~~relief ~~averages):~~of indebtedness income of $1,697,024 during the year ended December 31, 2025.

~~SCHEDULE OF FAIR VALUE OF OPTION USING VALUATION ASSUMPTIONS~~Bridge Loan

	Year Ended December 31,
	2024			2023
Risk-free interest rate		4.3	%		3.4	%
Expected term, in years		5.09			4.98
Expected volatility		116.9	%		118.3	%
Expected dividend yield		0	%		0	%
Determined weighted average grant date fair value per option	$	0.06		$	0.17

In February 2025, Jan Loeb, Executive Chairman, began advancing funds to the Company for operating expenses in the form of an interim bridge loan until alternate funding sources can be found. The bridge loan matured December 31, 2025 and has been extended to June 30, 2026. The Company is accruing interest at 10% per annum for these advances. The total advanced during the year ended December 31, 2025 was $161,867. Interest expense related to these advances was $9,990, during the year ended December 31, 2025.

~~The~~Convertible expected term of the options represents an estimate of the length of time until the expected date of exercising the options. Options granted have a maximum life of 6 years. With respect to determining expected exercise behavior, the Company has grouped its option grants into certain groups in order to track exercise behavior and establish historical rates. The Company estimated volatility by considering historical stock volatility over the period since the Company’s business focus shift to biotech. The risk-free interest rates are based on the U.S. Treasury yields for a period consistent with the expected term. The dividend yield of 0% is based on the Company’s history and expectation of dividend payout. The Company has not paid and does not anticipate paying of dividends in the near future.Debt

~~(c)~~In ~~Summary~~April ~~Option~~2024, ~~Information~~the Company borrowed $100,000 from unrelated parties pursuant to convertible debt agreements accounted for as debt. These agreements bear interest at 10% per annum and matured December 30, 2025. The maturity dates have been extended to June 30, 2026. The unpaid principal balance of these notes and any accrued interest may be converted into shares of the Company’s common stock at a conversion price of $0.13 per share. Interest accrued related to these agreements was $17,595 and $8,646, respectively, during the years ended December 31, 2025 and 2024.

ANOTE ~~summary of the Company’s option plans as of December 31, 2024 and 2023, as well as changes during each of the years then ended, is presented below:~~5—EQUITY

~~SCHEDULE OF STOCK OPTION ACTIVITIES~~(a) General

	Year Ended December 31,
	2024				2023
	Number		Weighted		Number		Weighted
	of		Average		of		Average
	Options		Exercise		Options		Exercise
	(in shares)		Price		(in shares)		Price
Outstanding at beginning of year		5,760,000		0.14		5,400,000		0.14
Granted		600,000		0.06		360,000		0.20
Outstanding at end of year		6,360,000		0.13		5,760,000		0.14
Exercisable at end of year		5,760,000		0.14		5,400,000		0.14

At December 31, 2025 and 2024, the Company had issued 50,316,672 shares and had 46,881,475 shares of its common stock outstanding with a par value of $0.01 per share. Holders of outstanding common stock are entitled to receive dividends when, as and if declared by the Board, and to share ratably in the assets of the Company legally available for distribution in the event of liquidation, dissolution or winding up of the Company.

~~Stock~~F-~~based compensation expense was approximately $40,000 and $303,000 in the years ending December 31, 2024 and 2023, respectively.~~14

~~The~~NOVELSTEM ~~total~~INTERNATIONAL ~~compensation cost related to non-vested awards not yet recognized was approximately $9,000 and $13,000, respectively, as of December 31, 2024 and 2023~~CORP.

~~F-14~~Notes to Financial Statements

~~NOVELSTEM~~(b) ~~INTERNATIONAL~~Summary ~~CORP.~~Employee Option Information

~~Notes~~The Company’s stock option plans provide for the grant to ~~Financial~~officers, ~~Statements~~directors, third party contractors and other future key employees of options to purchase shares of common stock. The purchase price may be paid in cash or at the end of the option term, if the option is “in-the-money”, it is automatically exercised “net”. In a net exercise of an option, the Company does not require a payment of the exercise price of the option from the optionee but reduces the number of shares of common stock issued upon the exercise of the option by the smallest number of whole shares that has an aggregate fair market value equal to or in excess of the aggregate exercise price for the option shares covered by the option exercised. Each option is exercisable to one share of the Company’s common stock. Most options expire within six years from the date of the grant and generally vest on the first anniversary date of their issuance. Pursuant to the Equity Incentive Plan approved by the Company’s board of directors on November 12, 2018, an aggregate of 6,360,000 options have been issued to directors and investor relations professionals of which 300,000 have expired and 6,060,000 remain outstanding.

The Company utilized the Black-Scholes option-pricing model to estimate fair value, utilizing the following assumptions for the options issued (din weighted averages) ~~Warrants~~ during the year ended December 31, 2024:

~~The Company~~ SCHEDULE ~~has~~OF ~~issued~~FAIR ~~warrants~~VALUE atOF ~~exercise~~OPTION ~~prices~~USING ~~equal~~VALUATION ~~to or greater than market value of the Company’s common stock at the date of issuance. A summary of warrant activity follows:~~ASSUMPTIONS

SUMMARY OF WARRANTS ACTIVITY

Risk-free interest rate		4.3	%
Expected term, in years		5.09
Expected volatility		116.9	%
Expected dividend yield		0	%
Determined weighted average grant date fair value per option	$	0.06

	Year Ended December 31,
	2024				2023
	Number of		Weighted		Number		Weighted
	shares		Average		of		Average
	underlying		Exercise		Options		Exercise
	warrants		Price		(in shares)		Price
Outstanding at beginning of year		3,000,000		0.12		3,000,000		0.12
Granted		-		-		-		-
Exercised		-		-		-		-
Forfeited or expired		-		-		-		-
Outstanding at end of year		3,000,000		0.12		3,000,000		0.12

No options were issued during the year ended December 31, 2025.

The ~~warrant~~expected ~~agreements~~term ~~were~~of ~~amended~~the onoptions ~~May~~represents ~~12,~~an ~~2023~~estimate toof ~~extend~~the length of time until the ~~expiration~~expected date toof ~~June~~exercising the options. Options ~~28,~~granted ~~2025~~have a maximum life of 6 years. ~~The~~With ~~warrants~~respect ~~outstanding~~to atdetermining ~~December~~expected 31exercise behavior, ~~2024~~the ~~have~~Company ahas ~~weighted~~grouped ~~average~~its ~~remaining~~option ~~contractual~~grants into ~~life~~certain ofgroups ~~approximately~~in ~~one 1.5~~order ~~half~~to ~~year~~track exercise behavior and establish historical rates. The Company ~~recognized~~estimated ~~$243,000~~volatility by considering inhistorical stock~~-based~~ ~~compensation~~volatility ~~expense~~over ~~related~~the toperiod since the ~~increase~~Company’s shift in ~~fair~~business ~~value~~focus ofto ~~warrants~~biotech. ~~pursuant~~The torisk-free interest rates are based on the ~~modification~~U.S. ofTreasury yields for a period consistent with the ~~warrant~~ expected term. ~~during~~The dividend yield of 0% is based on the ~~year~~Company’s history ~~ended~~and ~~December~~expectation ~~31,~~of ~~2023~~dividend payout. NoThe ~~such~~Company ~~expense~~has ~~was~~not ~~recognized~~paid ~~related~~and todoes ~~the~~not ~~warrants~~anticipate ~~during~~paying ~~the~~dividends ~~year~~in ~~ended~~the ~~December 31,~~near ~~2024~~future.

~~NOTE~~(c) ~~6—INCOME~~Summary ~~TAXES~~Option Information

~~For~~A ~~the~~summary ~~years~~of ~~ended December 31, 2024 and 2023,~~ the Company’s ~~incurred~~option ~~net~~plans ~~operating~~as ~~losses and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty~~ of ~~the realization of any tax assets. At~~ December 31, ~~2024~~2025 and ~~2023~~2024, ~~the~~as ~~Company~~well ~~had~~as ~~approximately~~changes ~~$48,000,000~~during ~~and~~each ~~$54,000,000, respectively~~ of ~~net~~the ~~operating~~years ~~losses~~then ~~subject to IRC Section 382 limitations~~ended, ~~of which $10,600,000 and $9,600,000, respectively, were available for carryforward after the consideration~~ ofis ~~IRC~~presented ~~Section 382 limitations. State of Florida net operating losses available for carryforward approximate the federal net operating loss carryforward amounts.~~below:

~~The federal~~ SCHEDULE ~~and~~OF ~~state~~STOCK ~~net~~OPTION operating losses began expiring in 2021. Approximately $5,000,000 and $300,000, respectively of federal and state losses expired in December 2024, and approximately $8,000,000 and $4,000,000, respectively, of federal and state losses expired in December 2023. The Company has approximately $6,063,000 in federal and state losses that do not expire. The remaining losses expire from 2025 through 2036. The majority of these expiring losses are further limited by IRC section 382 as shown in the deferred tax table below. All such deferred tax assets have been offset with a full valuation allowance.ACTIVITIES

The Company’s income tax provision differs from the expense that would result from applying statutory rates to income before taxes. A reconciliation of the provision (benefit) for income taxes with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows:

	Year Ended December 31,
	2025					2024
	Number			Weighted		Number		Weighted
	of			Average		of		Average
	Options			Exercise		Options		Exercise
	(in shares)			Price		(in shares)		Price
Outstanding at beginning of year		6,360,000			0.135		5,760,000		0.143
Granted		-			-		600,000		0.060
Forfeited or expired		(300,000	)		0.100		-		-
Outstanding at end of year		6,060,000			0.137		6,360,000		0.135
Exercisable at end of year		6,060,000			0.137		5,760,000		0.135

~~SCHEDULE~~Stock-based compensation OFexpense ~~INCOME~~was ~~BEFORE~~approximately ~~INCOME~~$8,800 ~~TAX~~and $40,000 in the years ending December 31, 2025 and 2024, respectively.

	2024			2023
	Year Ended December 31,
	2024			2023
Computed tax at the federal statutory rate of 21%	$	(645,119	)	$	(815,813	)
State income taxes, net of federal income tax benefit		(133,478	)		(168,796	)
Foreign rate differential		(24,892	)		(48,968	)
Change in federal valuation allowance		803,489			1,033,577
Total provision for income tax	$	-		$	-

F-15

~~F-15~~NOVELSTEM INTERNATIONAL CORP.

~~NOVELSTEM~~Notes ~~INTERNATIONAL~~to ~~CORP.~~Financial Statements

~~Notes~~The total compensation cost related to ~~Financial~~non-vested ~~Statements~~awards not yet recognized was approximately $9,000 as of December 31, 2024.

~~Deferred~~(d) income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets as of December 31, 2024 and 2023 consist of the following:Warrants

~~SCHEDULE~~The Company OFhad ~~DEFERRED~~issued ~~TAX~~warrants ~~ASSETS~~at exercise prices equal to or greater than market value of the Company’s common stock at the date of issuance. A summary of warrant activity follows:

	2024			2023
	As of December 31,
	2024			2023
Outside tax basis difference in equity investments	$	1,700,000		$	1,700,000
Federal and state net operating loss carryforwards available after consideration of IRC Section 382 limitations		2,801,830			2,540,308
General business credit		41,552			41,551
Related party interest and accretion of note discount		71,666			25,691
Loss on derivative instrument		92,750			68,900
Stock compensation		262,560			254,275
Total deferred tax assets	$	4,970,358		$	4,630,725
Federal and state net operating loss carryforwards subject to IRC Section 382 limitations		13,644,005			13,644,005
Less valuation allowance for net operating loss limitations		(13,644,005	)		(13,644,005	)
Valuation allowance		(4,968,553	)		(4,130,103	)
Subtotal deferred tax assets		1,805			500,622
Deferred tax liability, equity method basis difference		(1,805	)		(500,622	)
Net deferred tax assets	$	-		$	-

SUMMARY OF WARRANTS ACTIVITY

Management has evaluated all tax positions that could have a significant effect on the combined financial statements and determined the Company had no significant uncertain income tax positions at December 31, 2024 and 2023.

	Year Ended December 31,
	2025					2024
	Number of			Weighted		Number		Weighted
	shares			Average		of		Average
	underlying			Exercise		Options		Exercise
	warrants			Price		(in shares)		Price
Outstanding at beginning of year		3,000,000			0.12		3,000,000		0.12
Granted		-			-		-		-
Exercised		-			-		-		-
Forfeited or expired		(3,000,000	)		0.12		-		-
Outstanding at end of year		-			-		3,000,000		0.12

~~NOTE~~The ~~7—COMMITMENTS~~warrant ~~AND~~agreements ~~CONTINGENCIES~~were amended on May 12, 2023 to extend the expiration date to June 28, 2025. The warrants outstanding at December 31, 2024 had a weighted average remaining contractual life of approximately 1.5six months, all warrants expired on June 28, 2025.

~~The~~NOTE ~~Company~~6—INCOME ~~was~~TAXES the claimant in an arbitration proceeding against their 50% partner in NetCo. The Company initiated the arbitration proceeding in an effort to maximize the total potential value to be derived from fully utilizing the NetCo intellectual property across publishing, entertainment, digital media, merchandising and other ancillary markets. Arbitration hearings were held at the end of July 2022. Arbitration proceedings for the joint owners of NetCo concluded during 2022 and the arbitrator rendered a decision in July 2023. The arbitrator ruled against the Company on certain key issues of the arbitration and in the Company’s favor on two key issues of the arbitration.

~~The~~For ~~Arbitrator~~the ~~ruled~~years inended ~~NovelStem’s~~December ~~favor~~31, on2025 and 2024, the ~~issue~~Company ofincurred ~~contract~~tax ~~interpretation~~basis ofnet ~~the~~operating ~~Netco~~losses ~~Partners~~and, JVaccordingly, ~~Agreement.~~no ~~The~~provision ~~Arbitrator~~for income ~~also~~taxes ~~found~~has ~~that~~been ~~the~~recorded. ~~Company’s~~In ~~joint~~addition, ~~venture~~no ~~partner~~benefit ~~failed~~for toincome ~~use~~taxes ~~“reasonable,~~has ~~good~~been ~~faith~~recorded ~~efforts”~~due to ~~license~~the ~~and~~uncertainty ~~exploit~~ of the ~~Net~~realization ~~Force~~of ~~concept,~~any tax inassets. ~~breach~~At ofDecember ~~its~~31, ~~contractual~~2025 ~~obligations~~and ~~under~~2024, the ~~Netco~~Company ~~Partners’~~had ~~Joint~~approximately ~~Venture~~$41,000,000 ~~Agreement.~~and ~~The~~$48,000,000, ~~Arbitrator confirmed~~respectively ~~NovelStem’s~~of ~~contractual~~net ~~right~~operating losses subject to ~~use~~IRC ~~Tom~~Section ~~Clancy’s~~382 ~~name~~limitations, asof awhich ~~possessory~~$13,600,000 ~~credit~~and in$10,600,000, respectively, were available for carryforward after the consideration ~~Net~~of ~~Force~~IRC ~~title~~Section ~~(Tom~~382 ~~Clancy’s~~limitations. State of Florida net operating losses available for carryforward approximate the federal ~~Net~~net ~~Force)~~operating loss carryforward amounts.

AsThe afederal ~~result~~and ofstate ~~this~~net ~~ruling,~~operating ~~the~~losses ~~costs~~began ~~related~~expiring toin ~~the~~2021. ~~litigation~~Approximately ~~funding~~$7,400,000 ~~agreement~~and ~~disclosed~~$1,100,000, respectively of federal and state losses expired in ~~Note~~December 42025, ~~were~~and ~~recognized.~~approximately ~~Total~~$5,000,000 ~~costs~~and ~~related to~~$300,000, ~~the~~respectively, ~~litigation~~of federal and ~~the~~state ~~related~~losses ~~litigation~~expired ~~funding~~in ~~agreement~~December 2024. ofThe Company has approximately $29,~~799~~032,~~196,~~000 ~~including~~in afederal ~~reversal~~and ofstate ~~the~~losses ~~prior~~that ~~period~~do ~~contra~~not ~~expenses,~~expire. The remaining losses expire from 2026 ~~were~~through ~~recorded~~2036. ~~during~~The ~~the~~majority ~~December~~of ~~31,~~these ~~2023~~expiring ~~and~~losses ~~were~~are ~~separately~~further ~~stated~~limited by IRC section 382 as shown in the ~~statement~~deferred oftax ~~operations~~table below. All such deferred tax assets have been offset with a full valuation allowance.

~~NOTE 8—SUBSEQUENT~~The ~~EVENTS~~composition of income (loss) before income taxes is as follows:

~~The~~ SCHEDULE ~~Company~~OF ~~evaluated~~INCOME ~~subsequent~~LOSS ~~events~~BEFORE ~~through~~INCOME ~~the date these financial statements were available to be issued and filed with the SEC.~~TAXES

In February 2025, the Company reached an agreement with C.P. Group, Inc. (“CP”), our NetCo joint venture partner, and Omni Bridgeway (‘Omni”), the holder of the litigation funding agreement, to sell our interest in NetCo to CP for $1,300,000 in a transaction where the sales proceeds would be provided to Omni in exchange for a full release of our liability to Omni. A Settlement Agreement and Release has been prepared and approved by all parties, however is still in the process of being circulated and reviewed for final execution as of the date of these financial statements.

	2025		2024
	Year Ended December 31,
	2025		2024
Domestic	$	2,373,810		(1,443,339	)

~~F-16~~The Company’s income tax provision differs from the expense that would result from applying statutory rates to income before taxes.

~~(b)~~Upon adoption ~~Exhibits.~~of ASU 2023-09, Improvements to Income Tax Disclosures, as described in Note 2, Recently Adopted Accounting Standards, the reconciliation of taxes at the federal statutory rate to our provision for income tax for the year ended December 31, 2025 was as follows:

Exhibit Number		Description
3.1		Third Amended and Restated Articles of Incorporation December 1999 (1)
3.2		Articles of Amendment to Articles of Incorporation 2004 (1)
3.3		Articles of Amendment to Articles of Incorporation 2018 (1)
3.4		Bylaws (1)
3.5		Articles of Association of NewStem (1)
10.1		Equity Incentive Plan (1)
10.2		Joint Venture Agreement by and between the Company and NetCo (1)
10.3		Financing Agreement dated May 2022 (1)
10.4		Amendment to Financing Agreement dated July 2022 (1)
10.5		Promissory Note issued to Jan Loeb (1)
10.6		Promissory Note issued to Jerry Wolasky (1)
10.7		Form of NovelStem Subscription Agreement (1)
10.8		NewStem Share Purchase Agreement (1)
10.9		Redacted Litigation Funding Agreement with Omni Bridgeway (1)
10.10		Promissory Note issued to Stephen Gans
10.11		1st Amendment to Promissory Note issued to Jan Loeb
10.12		1st Amendment to Promissory Note issued to Jerry Wolasky
10.13		Certification of Principal Executive Officer and Executive Chairman pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
10.14		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
10.15		Certification of Principal Executive Officer and Executive Chairman pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
10.16		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

(1) Previously filed.

	Amount			Tax Rate
	Year Ended December 31,
	2025
	Amount			Tax Rate
Computed tax at the federal statutory rate of 21%	$	498,500			21.00	%
Increase (decrease) in income tax rate resulting from:
Nondeductible/nontaxable items
Stock compensation		1,856			0.00	%
Interest, related party, note discount and limitation		53,806			2.00	%
Loss on dissolution of equity method investment		(840,000	)		(35.00	)%
Other		(1,148	)		0.00	%
State income taxes, net of federal income tax benefit		103,261			4.00	%
Net Operating Loss Expiration		1,545,358			65.00	%
Permanent difference - relief of indebtedness income		(356,375	)		(15.00	)%
Foreign rate differential
Change in federal valuation allowance		(1,005,258	)		(42.00	)%
Total provision for income tax	$	-			0.00	%

28As previously disclosed for the year ended December 31, 2024, prior to the adoption of ASU No. 2023-09, reconciliation of the provision (benefit) for income taxes with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows:

Item 16. Form 10–K Summary.

	Amount			Tax Rate
	Year Ended December 31,
	2024
	Amount			Tax Rate
Computed tax at the federal statutory rate of 21%		(303,101	)		21.00	%
State income taxes, net of federal income tax benefit		(62,785	)		4.35	%
Foreign rate differential		(24,892	)		1.72	%
Change in federal valuation allowance		390,778			(27.07	)%
Permanent difference - relief of indebtedness income		-			0.00	%
Total provision for income tax	$	-			0.00	%

~~Not~~The Company has changed the calculation ~~applicable~~of income tax at the statutory rate based on net loss after losses from equity method investments of $3,233,042, as previously shown in our December 31, 2024 financial statements, to calculate income tax at the statutory rate based on net loss before income taxes, prior to the consideration of losses from equity method investments of $1,443,339.

29F-16

~~SIGNATURES~~NOVELSTEM INTERNATIONAL CORP.

~~Pursuant~~Notes to ~~the~~Financial requirements of Section 13 or 15(d) 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 April 7, 2025.Statements

~~NovelStem~~Deferred ~~International~~income ~~Corp~~taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets as of December 31, 2025 and 2024 consist of the following:

~~By:~~ SCHEDULE ~~/s/~~OF ~~Jan~~DEFERRED HTAX ~~Loeb Jan H. Loeb President and Executive Chairman~~ASSETS

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

	2025			2024
	As of December 31,
	2025			2024

Outside tax basis difference in equity investments	$	-		$	1,700,000
Federal and state net operating loss carryforwards available after consideration of IRC Section 382 limitations		3,610,354			2,801,830
General business credit		41,552			41,552
Related party interest and accretion of note discount		55,900			71,666
IRC Sec. 163(j) interest limitation		70,926			-
Loss on derivative instrument		-			92,750
Stock compensation		267,270			262,560
Total deferred tax assets	$	4,046,002		$	4,970,358
Federal and state net operating loss carryforwards subject to IRC Section 382 limitations		10,906,631			13,644,005
Less valuation allowance for net operating loss limitations		(10,906,631	)		(13,644,005	)
Valuation allowance		(4,046,002	)		(4,968,553	)
Subtotal deferred tax assets		-			1,805
Deferred tax liability, equity method basis difference		-			(1,805	)
Net deferred tax assets	$	-		$	-

Signature	Title	Date
/s/ Jan H. Loeb	President and Executive Chairman	April 7, 2025
Jan H. Loeb
/s/ Christine Jenkins	Vice President and Chief Financial Officer	April 7, 2025
Christine Jenkins
/s/ Mitchell Rubenstein	Director	April 7, 2025
Mitchell Rubenstein
/s/ Eric Richman	Director	April 7, 2025
Eric Richman
/s/ David Seltzer	Director	April 7, 2025
David Seltzer
/s/ Jerry Wolasky	Director	April 7, 2025
Jerry Wolasky
/s/ Tracy Clifford	Director	April 7, 2025
Tracy Clifford

Management has evaluated all tax positions that could have a significant effect on the financial statements and determined the Company had no significant uncertain income tax positions at December 31, 2025 and 2024.

30NOTE 7—COMMITMENTS AND CONTINGENCIES

The Company was the claimant in an arbitration proceeding against their 50% partner in NetCo. Arbitration proceedings concluded during 2022, and the arbitrator rendered a decision in July 2023. The arbitrator ruled against the Company on certain key issues of arbitration and in the Company’s favor on two key issues of arbitration.

As a result of this ruling, the costs related to the litigation funding agreement disclosed in Note 4 were recognized and a total liability of $2,819,196 was recorded. In May 2025 the Company’s interest in NetCo was sold in exchange for funds of $1,300,000 which were paid directly to Omni by CP Group in full settlement and release of all liabilities related to the Litigation Funding Agreement.

NOTE 8—SUBSEQUENT EVENTS

The Company evaluated subsequent events through the date these financial statements were available to be issued and filed with the SEC.

To date in 2026, the Company borrowed additional funds totaling approximately $28,000 from the Executive Chairman pursuant to the interim bridge loan disclosed in Note 4.

On March 13, 2026, the Company received $250,000 in exchange for 2,450,980.39 shares of common stock of the Company from an unrelated party.

F-17

(b)

Exhibits.

Exhibit Number		Description

3.1		Third Amended and Restated Articles of Incorporation December 1999 (1)

3.2		Articles of Amendment to Articles of Incorporation 2004 (1)

3.3		Articles of Amendment to Articles of Incorporation 2018 (1)

3.4		Bylaws (1)

3.5		Articles of Association of NewStem (1)

10.1		Equity Incentive Plan (1)

10.2		Joint Venture Agreement by and between the Company and NetCo (1)

10.3		Financing Agreement dated May 2022 (1)

10.4		Amendment to Financing Agreement dated July 2022 (1)

10.5		Promissory Note issued to Jan Loeb (1)

10.6		Promissory Note issued to Jerry Wolasky (1)

10.7		Form of NovelStem Subscription Agreement (1)

10.8		NewStem Share Purchase Agreement (1)

10.9		Redacted Litigation Funding Agreement with Omni Bridgeway (1)

10.10		Promissory Note issued to Stephen Gans (1)

10.11		1^stAmendment to Promissory Note issued to Jan Loeb (1)

10.12		1^stAmendment to Promissory Note issued to Jerry Wolasky (1)

10.13		1^st Amendment to Promissory Note issued to Stephen Gans (1)

10.14		Bridge Note issued to Jan Loeb (1)

10.15		2^nd Amendment to Promissory Note issued to Stephen Gans (1)

10.16		Certification of Principal Executive Officer and Executive Chairman pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

10.17		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

10.18		Certification of Principal Executive Officer and Executive Chairman pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

10.19		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

(1)

Previously filed.

Item 16. Form 10–K Summary.

Not applicable

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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 March 25, 2026.

NovelStem International Corp.

By:	/s/ Jan H Loeb
	Jan H. Loeb
	President and Executive Chairman

Signature	Title	Date

/s/ Jan H. Loeb	President and Executive Chairman	March 25, 2026
Jan H. Loeb

/s/ Christine Jenkins	Vice President and Chief Financial Officer	March 25, 2026
Christine Jenkins

/s/ Mitchell Rubenstein	Director	March 25, 2026
Mitchell Rubenstein

/s/ Eric Richman	Director	March 25, 2026
Eric Richman

/s/ David Seltzer	Director	March 25, 2026
David Seltzer

/s/ Jerry Wolasky	Director	March 25, 2026
Jerry Wolasky

/s/ Tracy Clifford	Director	March 25, 2026
Tracy Clifford

Filing Compare · NovelStem International Corp.