UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to_____________

Commission File Number: 001-41612

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

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 requirementsfor the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registranthas submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding12 months (or for such shorter period that the registrant was required to submit such files).Yes ☒ No ☐

Indicate by check mark whether the registrantis 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.

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

Indicate by check mark whether the registrantis a shell company (as defined in Rule 12b-2 of the Exchange Act).  

Yes ☐ No ☒

As of August 1, 2025, there were a total of 1,000,000shares of the registrant’s Class A Common Stock, $0.0001 par value per share, outstanding, and 15,624,395 shares of the registrant’sClass B Common Stock, $0.0001 par value per share, outstanding.

ASSET ENTITIES INC.

Quarterly Report on Form 10-Q

 Period Ended June 30, 2025

TABLE OF CONTENTS

PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

ASSET ENTITIES INC.

UNAUDITED FINANCIAL STATEMENTS

ASSET ENTITIES INC.

Balance Sheets

The accompanying notes are an integral part of these unauditedcondensed financial statements.

ASSET ENTITIES INC.

Statements of Operations

(Unaudited)

The accompanying notes are an integral partof these unaudited condensed financial statements.

ASSET ENTITIES INC.

Statement of Stockholders’ Equity

For the six months ended June 30, 2025 and 2024

(Unaudited)

ASSET ENTITIES INC.

Statement of Stockholders’ Equity

For the six months ended June 30, 2025 and 2024

(Unaudited)

The accompanying notes are an integral partof these unaudited condensed financial statements.

ASSET ENTITIES INC.

Condensed Statements of Cash Flows

(Unaudited)

The accompanying notes are an integral partof these unaudited condensed financial statements.

ASSET ENTITIES INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

As of and for the six months ended June 30,2025

(Unaudited)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSISOF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following management’s discussionand analysis of financial condition and results of operations provides information that management believes is relevant to an assessmentand understanding of our plans and financial condition. The following financial information is derived from our condensed financialstatements and should be read in conjunction with such condensed financial statements and notes thereto set forth elsewhere herein.

Use of Terms

Except as otherwise indicated by the context andfor the purposes of this Quarterly Report on Form 10-Q only, references in this Quarterly Report on Form 10-Q to “we,” “us,”“our,” the “Company,” “Asset Entities,” and “our company” are to Asset Entities Inc.,a Nevada corporation. “Common stock” refers to the Company’s Common Stock, $0.0001 par value per share. “ExistingClass A Common Stock” refers to the Company’s Class A Common Stock, $0.0001 par value per share. “Existing Class B CommonStock” refers to the Company’s Class B Common Stock, $0.0001 par value per share. “Preferred stock” refers tothe Company’s Preferred Stock, $0.0001 par value per share. “Series A Preferred Stock” refers to the Company’sSeries A Convertible Preferred Stock, $0.0001 par value per share.

Reverse Stock Split

Unless otherwise noted,the share and per share information in this Quarterly Report on Form 10-Q have been adjusted to give effect to the one-for-five (1-for-5)reverse stock split of each of the Company’s authorized and issued and outstanding Existing Class A Common Stock and the Company’sauthorized and issued and outstanding Existing Class B Common Stock, which became effective as of 5:00 p.m. Eastern Daylight Time on July1, 2024 (the “Reverse Stock Split”).

Note Regarding Trademarks, Trade Names andService Marks

We use various trademarks, trade names and servicemarks in our business, including “AE 360 DDM”, “Asset Entities Where Assets Are Created”, “SiN”, “SocialInfluencer Network”, Ternary D, OptionsSwing, and associated marks. For convenience, we may not include the SM, ® or ™symbols, but such omission is not meant to indicate that we would not protect our intellectual property rights to the fullest extent allowedby law. Any other trademarks, trade names or service marks referred to in this Quarterly Report on Form 10-Q are the property of theirrespective owners.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-lookingstatements that are based on our management’s beliefs and assumptions and on information currently available to us. All statementsother than statements of historical facts are forward-looking statements. These statements relate to future events or to our future financialperformance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity,performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressedor implied by these forward-looking statements. Such risks, uncertainties and other factors include, but are not limited to:

In some cases, you can identify forward-lookingstatements by terms such as “may,” “could,” “will,” “should,” “would,” “expect,”“plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,”“potential,” “project” or “continue” or the negative of these terms or other comparable terminology.These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known andunknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results.Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under Item1A. “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the U.S.Securities and Exchange Commission (the “SEC”) on March 31, 2025. If one or more of these risks or uncertainties occur, orif our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected bythe forward-looking statements. No forward-looking statement is a guarantee of future performance.

In addition, statements that “we believe”and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information availableto us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements,such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustiveinquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors arecautioned not to unduly rely upon these statements.

The forward-looking statements made in this QuarterlyReport on Form 10-Q relate only to events or information as of the date on which the statements are made in this Quarterly Report on Form10-Q. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-lookingstatements, whether as a result of new information, future events, changed circumstances or any other reason.

Overview

Asset Entities is a technology company providingsocial media marketing and content delivery services across Discord, TikTok, and other social media platforms. We also design, developand manage servers for communities on Discord. Based on the growth of our Discord servers and social media following, we have developedthree categories of services: (1) our Discord investment education and entertainment services, (2) social media and marketing services,and (3) our “AE.360.DDM” brand services. We also offer Ternary v2, a cloud-based subscription management and payment processingsolution for Discord communities, which includes a suite of customer relations management tools and Stripe-verified payment processing.All of our services are based on our effective use of Discord as well as other social media including TikTok, X, Instagram, and YouTube.

OurDiscord investment education and entertainment service is designed primarily by and for enthusiastic Generation Z, or Gen Z, retail investors,creators and influencers. Gen Z is commonly considered to be people born between 1997 and 2012. Our investment education and entertainmentservice focuses on stock, real estate, cryptocurrency, and NFT community learning programs designed for the next generation. While webelieve that Gen Z will continue to be our primary market, our Discord server offering features education and entertainment content coveringreal estate investments, which is expected to appeal strongly to older generations as well. Our combined server user membership was approximately203,466 as of June 30, 2025.

Our social media and marketing services utilizeour management’s social influencer backgrounds by offering social media and marketing campaign services to business clients. Ourteam of social influencer independent contractors, which we call our “SiN” or “Social Influencer Network”, canperform social media and marketing campaign services to expand our clients’ Discord server bases and drive traffic to their businesses,as well as increase membership in our own servers.

Our “AE.360.DDM, Design Develop Manage”service, or “AE.360.DDM”, is a suite of services to individuals and companies seeking to create a server on Discord. We believewe are the first company to provide “Design, Develop and Manage,” or DDM, services for any individual, company, or organizationthat wishes to join Discord and create their own community. With our AE.360.DDM rollout, we are uniquely positioned to offer DDM servicesin the growing market for Discord servers.

Through Ternary v2, our subscription managementand payment processing solution for Discord communities, subscribers can monetize and manage their Discord users. Ternary v2 simplifiesthe process for our subscribers to: (i) sell memberships to their Discord servers on their websites and collect payments through Stripewith daily payouts; (ii) add digital products and services and designate purchase options to their Discord servers; (iii) customize theiruser Discord permissions and roles and other Discord settings; and (iv) utilize our Discord bot to automatically apply their Discord usersettings to authenticate new users, apply customizable permission sets to users, and remove users when their subscriptions expire. Asa Stripe-verified partner through Ternary v2, we can also assist subscribers with integrating other platforms into their Discord serverswith open application programming interfaces, further extending our platform’s capabilities.

We believe that we are a leading provider of allof these services, and that demand for all of our services will continue to grow. We expect to experience rapid revenue growth from ourservices. We believe that we have built a scalable and sustainable business model and that our competitive strengths position us favorablyin each aspect of our business.

Our revenue depends on the number of paying subscribersto our Discord servers. During the three months ended June 30, 2025 and 2024, we received revenue from 1,163 and 1,238 Asset EntitiesDiscord server paying subscribers, respectively.

Our Historical Performance

As of June 30, 2025, the Company had an accumulateddeficit of $16,330,381 and cash and cash equivalents of $2,518,441. During the three months ended June 30, 2025 and 2024, we hada net loss of $2,664,611 and $1,726,537, respectively. To date, the Company has financed its operations primarily through capital raisesand sales of its services. In April 2024, the Company filed a Registration Statement on Form S-3 (File No. 333-278707), which was declaredeffective by the SEC on April 26, 2024, for potential offerings of up to $100,000,000 in aggregate (the “Shelf Registration Statement”),subject to the requirement that in no event may we sell shares having a value exceeding more than one-third of our public float in any12-month period under the Shelf Registration Statement so long as our public float remains below $75,000,000. In May 2024, the Companycompleted the first of a two-part private placement of its Series A Preferred Stock for gross proceeds of $1.5 million, and in July 2024,the Company completed the second part of the private placement for an additional $1.5 million in gross proceeds. In September 2024, theCompany entered into a Sales Agreement, dated as of September 27, 2024 (the “ATM Sales Agreement”), between the Company andA.G.P./Alliance Global Partners (the “Sales Agent”), and filed a prospectus supplement to the Shelf Registration Statementfor an “at the market offering” of shares of Existing Class B Common Stock (the “ATM Financing”) for gross proceedsof up to $1,791,704. As of June 30, 2025, the Company had filed additional prospectus supplements to the Shelf Registration Statementto increase the maximum gross proceeds to $5,489,399. Since the commencement of the ATM Financing and as of June 30, 2025, a total of5,427,700 shares has been sold, for net proceeds to the Company of $4,830,647.56, after paying $329,362 in compensation to the SalesAgent and the same amount to Boustead Securities, LLC (“Boustead”) under the Boustead ATM Waiver (as defined in “—Liquidityand Capital Resources – ATM Financing – Waivers and Consents to ATM Financing”). The Company has received confirmationfrom the investor in its Series A Preferred Stock that it will invest up to an additional $3 million upon request by the Company.

In addition,on May 26, 2025, the Company and Strive entered into the May 2025 Private Placement (as defined in “—May 2025 Private Placement”).The Private Placement is expected to close substantially concurrently with the transactions under the A&R Merger Agreement, subjectto the satisfaction of conditions precedent to the Company’s and Strive’s obligations to consummate the transactions underthe A&R Merger Agreement being satisfied or waived and such transactions being consummated, the Company obtaining stockholder approvalfor the issuance of the May 2025 Private Placement Securities (as defined in “—May 2025 Private Placement”) asrequired by the applicable rules of The Nasdaq Stock Market LLC (“Nasdaq”), as well as the satisfaction of certain customaryclosing conditions. The Company expects to receive aggregate gross proceeds from the May 2025 Private Placement of approximately $750.3million, before deducting placement agent fees and offering expenses. If all of the May 2025 Traditional Warrants are exercisedin full for cash, the Company could receive up to an additional approximately $750 million in gross proceeds, for total potential proceedsof approximately $1.5 billion.

Based on the Company’s existing cash resourcesand the cash expected to be received from the ATM Financing, the May 2025 Private Placement,and other planned financings, it is expected that the Company will have sufficient funds to carry out the Company’s planned operationsthrough June 30, 2026 and for at least 12 months beyond that period. For further discussion, see Item 7. “—Liquidity andCapital Resources”.

Principal Factors Affecting Our Financial Performance

Our operating results are primarily affected bythe following factors:

Emerging Growth Company and Smaller ReportingCompany

We qualify as an “emerging growth company”under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As a result, we are permitted to, and intend to, relyon exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:

In addition, Section 107 of the JOBS Act alsoprovides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the SecuritiesAct of 1933, as amended (the “Securities Act”), for complying with new or revised accounting standards. In other words, anemerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to privatecompanies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may thereforenot be comparable to those of companies that comply with such new or revised accounting standards.

We will remain an emerging growth company untilthe earliest of (i) the last day of the fiscal year following the fifth anniversary of our initial public offering; (ii) the last dayof the first fiscal year in which our total annual gross revenues are $1,235,000,000 or more; (iii) the date that we become a “largeaccelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last businessday of our most recently completed second fiscal quarter; or (iv) the date on which we have issued more than $1 billion in non-convertibledebt during the preceding three year period.

To the extent that we continue to qualify as a“smaller reporting company,” as such term is defined in Rule 12b-2 under the Exchange Act, after we cease to qualify as anemerging growth company, certain of the exemptions available to us as an emerging growth company may continue to be available to us asa smaller reporting company, including as to: (i) the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act; (ii)scaled executive compensation disclosures; (iii) presenting two years of audited financial statements, instead of three years; and (iv)compliance with certain greenhouse gas emissions disclosure and related third-party assurance requirements.

Results of Operations

Comparison of Three Months Ended June 30,2025 and 2024

Revenue.Our revenue increased 86.4% to approximately $0.17 million for the three months ended June 30, 2025 from approximately $0.09 million forthe three months ended June 30, 2024. This increase was primarily due to the increased number of our Discord server paying subscribersfor the three months ended June 30, 2025, including subscribers to the Pure Profits Discord server that the Company acquired in June 2024,compared to such number for the three months ended June 30, 2024. Due in part to the Company’s sale of the Pure Profits Discordserver and related assets in July 2025, there is no assurance that revenues will continue to increase. There was no material differencein the Company’s subscription pricing structure between these periods.

Operating Expenses. Our total operatingexpenses increased 57.5% to approximately $2.9 million for the three months ended June 30, 2025 from approximately $1.8 million for thethree months ended June 30, 2024. This increase was primarily due to an increase in advertising, marketing, payroll and other administrativeexpenses and administrative cost of public filings, compared to such costs for the three months ended June 30, 2024.

LossFrom Operations. Our loss from operations increased 55.9% to approximately $2.7 million for the three months ended June 30, 2025from approximately $1.7 million for the three months ended June 30, 2024.This increase was primarily due to an increase in advertising, marketing, payroll and other administrative expenses and administrativecost of public filings, compared to such costs for the three months ended June 30, 2024.

Comparison of SixMonths Ended June 30, 2025 and 2024

Revenue.Our revenue increased 57.9% to approximately $0.34 million for the six months ended June 30, 2025 from approximately $0.22 million forthe six months ended June 30, 2024. This increase was primarily due to the increased number of our Discord server paying subscribers forthe six months ended June 30, 2025, including subscribers to the Pure Profits Discord server that the Company acquired in June 2024,compared to such number for the six months ended June 30, 2024. Due in part to the Company’s sale of the Pure Profits Discord serverand related assets in July 2025, there is no assurance that revenues will continue to increase. There was no material difference in theCompany’s subscription pricing structure between these periods.

OperatingExpenses. Our total operating expenses increased 40.9% to approximately $4.7 million for the six months ended June 30, 2025 fromapproximately $3.3 million for the six months ended June 30, 2024. This increase was primarily due to an increase in advertising, marketing,payroll and other administrative expenses and administrative cost of public filings, compared to such costs for the six months endedJune 30, 2024.

LossFrom Operations. Our loss from operations increased 39.7% to approximately $4.3 million for the six months ended June 30, 2025from approximately $3.1 million for the six months ended June 30, 2024.This increase was primarily due to an increase in advertising, marketing, payroll and other administrative expenses and administrativecost of public filings, compared to such costs for the six months ended June 30, 2024.

Liquidity and Capital Resources

As of June 30, 2025,the Company had an accumulated deficit of $16,330,381 and cash and cash equivalents of $2,518,441. During the three months endedJune 30, 2025 and 2024, we had a net loss of $2,664,611 and $1,726,537, respectively. To date, the Company has financed its operationsprimarily through capital raises and sales of its services. Based on the Company’s existing cash resources, the cash expected tobe received from planned financings, and increased revenues expected to be generated from expanded operations due to prior asset acquisitions,it is expected that the Company will have sufficient funds to carry out the Company’s planned operations through June 30, 2026 andfor at least 12 months beyond that period.

As indicated above, wemay require additional cash resources due to changing business conditions, implementation of our strategy to expand our business, or otherinvestments or acquisitions we may decide to pursue. If our own financial resources are insufficient to satisfy our capital requirements,we may seek to sell additional equity or debt securities or obtain additional credit facilities. The sale of additional equity securitiescould result in dilution to our stockholders. The incurrence of indebtedness would result in increased debt service obligations and couldrequire us to agree to operating and financial covenants that would restrict our operations. Financing may not be available in amountsor on terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at all, could limitour ability to expand our business operations and could harm our overall business prospects.

Summary of Cash Flow

The following table provides detailed informationabout our net cash flow for the periods presented:

Netcash used in operating activities was approximately $3.3 million for the six months ended June 30, 2025, as compared to net cash usedin operating activities of approximately $2.3 million for the six months ended June 30, 2024. This increase was primarily due to an increasein net loss of approximately $1.2 million, offset by an increase in stock-based compensation of approximately $0.3 million.

Net cash used in investing activities was $0 forthe six months ended June 30, 2025, as compared to approximately $0.2 million for the six months ended June 30, 2024. This change wasprimarily due to the non-recurrence of purchases of property, equipment and intangible assets duringthe six months ended June 30, 2025.

Net cash provided by financing activities wasapproximately $3.1 million for the six months ended June 30, 2025, as compared to approximately $1.5 million for the six months endedJune 30, 2024. This change was primarily due to the proceeds from the issuance of Existing Class B Common Stock during the six monthsended June 30, 2025.

Agreement and Planof Merger

On May 6, 2025, the Companyentered into an Agreement and Plan of Merger (the “Original Merger Agreement”) with Alpha Merger Sub, LLC, an Ohio limitedliability company and wholly-owned subsidiary of the Company (“Merger Sub”), Strive Enterprises, Inc., an Ohio corporation(“Strive”), and Strive Asset Management, LLC, an Ohio limited liability company and a wholly owned subsidiary of Strive (“AssetManagement”).

On June 27, 2025, asa result of Strive electing the Restructuring Election (as defined in Section 2.06 of the Original Merger Agreement), the Company enteredinto an Amended and Restated Agreement and Plan of Merger (the “A&R Merger Agreement”) with Alpha Merger Sub, Inc., anOhio corporation (formerly Alpha Merger Sub, LLC), and Strive, pursuant to which, and subject to the satisfaction or waiver of the conditionsset forth in the A&R Merger Agreement, Merger Sub will merge with and into Strive (the “Merger”), with Strive continuingas a wholly owned subsidiary of the Company and the surviving company of the Merger.

Because Merger Sub willmerge with and into Strive under the A&R Merger Agreement (instead of Asset Management, as contemplated under the Original MergerAgreement), stockholders of Strive, rather than Strive itself, will receive the merger consideration. In particular, subject to the termsand conditions of the A&R Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share ofcapital stock of Strive will be converted into the right to receive a number of shares of the Company Consideration Stock equal to theExchange Ratio plus cash in lieu of fractional shares as specified in the A&R Merger Agreement. The “Company Consideration Stock”shall be the Existing Class A Common Stock redesignated as class B common stock, $0.0001 par value per share, of the Company (“NewClass B Common Stock”), pursuant to amended and restated articles of incorporation of the Company to be adopted and approved inaccordance with the A&R Merger Agreement (the “A&R Articles of Incorporation”). The Existing Class B Common Stockwill also be redesignated as class A common stock, $0.0001 par value per share, of the Company (“New Class A Common Stock”).The “Exchange Ratio” shall be calculated so that each holder of Strive capital stock will receive, in respect of each shareof capital stock of Strive, a number of shares of Company Consideration Stock equal to the quotient obtained by dividing (a) the AggregateMerger Consideration Share Number (as defined in the A&R Merger Agreement) by (b) the aggregate number of shares of Strive commonstock issued and outstanding as of immediately prior to the Effective Time (assuming, for purposes of this definition, the conversionof all Strive preferred stock and including shares of Strive common stock subject to restricted stock units that settle in shares of Strivecommon stock (“Strive RSUs”) that have vested but not settled or restricted stock awards that settle in shares of Strive commonstock (“Strive RSAs”) that have vested but not settled).

Each Strive RSU and StriveRSA that is outstanding as of the closing of the Merger shall be assumed by the Company or converted into or substituted for a restrictedstock unit that settles in shares of New Class B Common Stock of equivalent value.

Pursuant to the A&RMerger Agreement, the Company, Merger Sub and Strive agreed, among other things, to extend the “End Date”, as defined in Section11.01(b)(i) of the Original Merger Agreement, to February 6, 2026. This End Date extension was agreed to account for potential processdelays out of the ordinary course that are not anticipated. The parties expect the Merger to close by early Fall 2025, which is unchangedfrom the parties’ original timeline.

The board of directorsof the Company unanimously adopted and approved the A&R Merger Agreement and the transactions contemplated thereby, and, subject tothe terms and conditions of the A&R Merger Agreement, resolved to recommend that the Company’s stockholders approve the issuanceof Company Consideration Stock in connection with the Merger, the amendments to the Company’s organizational documents contemplatedby the A&R Merger Agreement and the other transactions contemplated thereby.

In connection with theMerger, the Company will prepare and file with the SEC a registration statement on Form S-4 registering the New Class A Common Stock anda proxy statement with respect to the meeting of the Company’s stockholders.

Concurrently with theexecution of the A&R Merger Agreement, on June 27, 2025, Strive and certain stockholders of the Company entered into an Amended andRestated Voting and Support Agreement (the “A&R Support Agreement”), pursuant to which, among other things, each suchstockholder agreed, on the terms and subject to the conditions set forth therein, (i) to vote all of their respective voting shares inthe Company, collectively constituting approximately 40.2% of the total voting power of the outstanding shares of the Company’scommon stock as of the date of the A&R Merger Agreement, in favor of the matters contemplated by the A&R Merger Agreement, (ii)to convert their Existing Class A Common Stock into Existing Class B Common Stock (which will be redesignated as New Class A Common Stock),in exchange for a payment of $2.5 million from the Company and (iii) certain other matters in connection with the Merger as contemplatedthereby.

If the A&R Merger Agreement is terminatedunder specified circumstances, Asset Entities will be required to pay Strive a termination fee of $10,000,000 or Strive will be requiredto pay Asset Entities a termination fee of $10,000,000.

Cantor Fitzgerald &Co. (“CFCO”) will be acting as financial advisor to Strive. CFCO will receive a non-refundable cash fee equal to $2 millionupon the closing of the Merger. CFCO will receive a non-refundable cash fee of $1 million if the termination fee described above is paidto Strive.

The A&R Merger Agreementcontains representations, warranties and covenants that the respective parties made to each other as of the date of such agreement orother specific dates. The assertions embodied in those representations, warranties and covenants were made for purposes of the contractamong the respective parties and are subject to important qualifications and limitations agreed to by the parties in connection with negotiatingsuch agreement. The A&R Merger Agreement has been filed to provide investors with information regarding its terms. It is not intendedto provide any other factual information about the Company, Strive or any other party to the A&R Merger Agreement. In particular,the representations, warranties, covenants and agreements contained in the A&R Merger Agreement, which were made only for purposesof such agreement and as of specific dates, were solely for the benefit of the parties to the A&R Merger Agreement, may be subjectto limitations agreed upon by the contracting parties (including being qualified by confidential disclosures made for the purposes ofallocating contractual risk between the parties to the A&R Merger Agreement instead of establishing these matters as facts) and maybe subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors and reportsand documents filed with the SEC. Investors should not rely on the representations, warranties, covenants and agreements, or any descriptionsthereof, as characterizations of the actual state of facts or condition of any party to the A&R Merger Agreement. In addition, therepresentations, warranties, covenants and agreements and other terms of the A&R Merger Agreement may be subject to subsequent waiveror modification. Moreover, information concerning the subject matter of the representations and warranties and other terms may changeafter the date of the A&R Merger Agreement, which subsequent information may or may not be fully reflected in the Company’spublic disclosures.

The foregoing descriptionof the A&R Merger Agreement, the Merger, and the A&R Support Agreement does not purport to be complete, and is qualified in itsentirety by the terms and conditions of the A&R Merger Agreement and A&R Support Agreement, copies of which are filed as Exhibit2.2 and Exhibit 10.2 hereto, respectively, and are incorporated herein by reference.

May 2025 PrivatePlacement

On May 26, 2025, theCompany and Strive entered into subscription agreements (the “May 2025 Subscription Agreements”) with certain accredited investors(the “May 2025 Subscribers”), pursuant to which the May 2025 Subscribers agreed to purchase, and the Company agreed to issueand sell, (i) an aggregate of 346,043,350 shares of New Class A Common Stock at a price of $1.35 per share (the “May 2025 PlacementShares”), (ii) pre-funded warrants to purchase 209,771,462 shares of New Class A Common Stock, at a price of $1.3499 per share (the“May 2025 Pre-Funded Warrants”) to certain of the May 2025 Subscribers in lieu of May 2025 Placement Shares, and (iii) 555,814,812warrants to purchase shares of New Class A Common Stock (the “May 2025 Traditional Warrants” and, together with the May 2025Placement Shares and May 2025 Pre-Funded Warrants, the “May 2025 Private Placement Securities” and such financing, the “May2025 Private Placement”).

The May 2025 PrivatePlacement was entered into following the execution of the Original Merger Agreement, which was subsequently amended and restated by theA&R Merger Agreement.

The May 2025 PrivatePlacement is expected to close substantially concurrently with the transactions under the A&R Merger Agreement, subject to the satisfactionof conditions precedent to the Company’s and Strive’s obligations to consummate the transactions under the A&R MergerAgreement being satisfied or waived and such transactions being consummated, the Company obtaining stockholder approval for the issuanceof the May 2025 Private Placement Securities as required by the applicable rules of Nasdaq, as well as the satisfaction of certain customaryclosing conditions. The Company expects to receive aggregate gross proceeds from the May 2025 Private Placement of approximately $750.3million, before deducting placement agent fees and offering expenses. If all of the warrants issued in the PIPE financing are exercisedin full for cash, the Company could receive up to an additional approximately $750 million in gross proceeds, for total potential proceedsof approximately $1.5 billion.

Pursuant to the termsof the May 2025 Subscription Agreements, the Company agreed to register for resale the May 2025 Placement Shares and the shares of theCompany’s common stock issuable upon exercise of the May 2025 Pre-Funded Warrants and the May 2025 Traditional Warrants (the “May2025 Warrant Shares” and, together with the Shares, the “May 2025 Registrable Securities”), including an obligationto file a registration statement covering the resale by the May 2025 Subscribers of their May 2025 Registrable Securities no later than30 days following the closing of the transactions contemplated by the A&R Merger Agreement. The Company has agreed to use commerciallyreasonable efforts to cause such registration statement to be declared effective as soon as practicable (and in no event later than theearlier of (i) the 45th day after the closing of the May 2025 Private Placement or (ii) the 120th day after the closing of the May 2025Private Placement, if the SEC staff determines to review the registration statement) (the “Outside Effectiveness Date”) andto keep such registration statement effective until the date that all May 2025 Registrable Securities covered by such registration statementhave been sold or can be sold without restriction pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1)(or any successor thereof) promulgated under the Securities Act. The Company has agreed to be responsible for all fees and expenses incurredin connection with the registration of the May 2025 Registrable Securities.

In addition, the May2025 Subscription Agreements provide that, without the prior written consent of May 2025 Subscribers representing a majority in interestof the May 2025 Placement Shares, it will not, during the period commencing on May 26, 2025 and ending 45 days after the Outside EffectivenessDate (the “May 2025 Private Placement Restricted Period”), (1) offer, pledge, sell, contract to sell, sell any option or contractto purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or disposeof, directly or indirectly, any shares of New Class A Common Stock or New Class B Common Stock, or any securities convertible into orexercisable or exchangeable for New Class A Common Stock or New Class B Common Stock, or (2) enter into any swap or other arrangementthat transfers to another, in whole or in part, any of the economic consequences of ownership of the New Class A Common Stock or New ClassB Common Stock, whether any such transaction is to be settled by delivery of New Class A Common Stock or New Class B Common Stock or suchother securities, in cash or otherwise; provided that the foregoing restrictions shall not apply to (i) the issuance of securities offeredor sold prior to the May 2025 Private Placement Restricted Period, including the issuance of the May2025 Private Placement Securities under the May 2025 Subscription Agreements or the issuance of any May 2025 Warrant Shares uponconversion thereof; (ii) the issuance by the Company of any shares of New Class A Common Stock or New Class B Common Stock upon the exerciseof an option or warrant, the settlement of restricted stock units or the conversion of a security outstanding on or prior to the OutsideEffectiveness Date or granted pursuant to the terms of an equity compensation plan; (iii) grants of stock options, stock awards, restrictedstock awards, restricted stock units or other equity awards and the issuance of New Class A Common Stock or New Class B Common Stock orsecurities convertible into or exercisable for New Class A Common Stock or New Class B Common Stock (whether upon the exercise of stockoptions or otherwise) to employees, officers, directors, advisors, or consultants of the Company pursuant to the terms of an equity compensationplan; (iv) the facilitation by the Company of sales of shares of New Class A Common Stock or New Class B Common Stock by executive officersand directors of the Company in respect of the payment of taxes due as the result of the vesting and settlement of restricted stock unitsor other compensation awards; (v) the issuance and sale of securities pursuant to the A&R Merger Agreement; (vi) the offer or issuanceor agreement to issue New Class A Common Stock or New Class B Common Stock or securities convertible into, exercisable for or which areotherwise exchangeable for or represent the right to receive New Class A Common Stock or New Class B Common Stock in connection with anacquisition, merger, joint venture, strategic alliance, commercial or other collaborative relationship; (vii) the offer or issuance oragreement to issue New Class A Common Stock or New Class B Common Stock or securities convertible into New Class A Common Stock or NewClass B Common Stock if the consideration payable for such securities is in the form of Bitcoin or another digital currency and suchoffering closes substantially concurrently with the closing of the transactions contemplated by the A&R Merger Agreement in a transactionexpected to benefit from Section 351 of the Internal Revenue Code so long as the price per share in such offering is at least equal toor greater than $3.00 per share; (viii) prior to the Outside Effectiveness Date, the offer or issuance or agreement to issue New ClassA Common Stock or New Class B Common Stock (A) in a private placement transaction if the price per share is at least equal to or greaterthan $3.00 per share or (B) in an at-the-market offering if the price per share is at least equal to or greater than $5.00 per share;and (ix) after the Outside Effectiveness Date but prior to the end of the May 2025 Private Placement Restricted Period, the offer or issuanceor agreement to issue New Class A Common Stock or New Class B Common Stock (including pursuant to an at-the-market program) if the closingprice of New Class A Common Stock or New Class B Common Stock exceeds $4 per share for 5 consecutive trading days, with such measurementperiod beginning on or after the Outside Effectiveness Date.

CFCO acted as lead placementagent for the May 2025 Private Placement. CFCO will receive a non-refundable cash fee equal to 3.5% of the aggregate maximum gross proceedsreceived or receivable in connection with the May 2025 Private Placement.

The representations,warranties and covenants contained in the May 2025 Subscription Agreements were made solely for the benefit of the parties thereto andthe placement agents expressly named as third-party beneficiaries thereto and may be subject to limitations agreed upon by the contractingparties. Accordingly, the May 2025 Subscription Agreements are incorporated herein by reference only to provide investors with informationregarding the terms thereof and not to provide investors with any other factual information regarding the Company or its business, andshould be read in conjunction with the disclosures in the Company’s periodic reports and other filings with the SEC.

May 2025 Pre-FundedWarrants

Each May 2025 Pre-FundedWarrant to be issued in the May 2025 Private Placement will have an exercise price of $0.0001 per share, will be exercisable immediatelyon issuance and will be exercisable until the Pre-Funded Warrant is exercised in full. The May 2025 Pre-Funded Warrants include customaryanti-dilution adjustments.

Under the terms of theMay 2025 Pre-Funded Warrants, the Company may not effect the exercise of any such warrant, and a holder will not be entitled to exerciseany portion of any such warrant, if, upon giving effect to such exercise and unless otherwise elected by the respective May 2025 Subscriberpursuant to their May 2025 Subscription Agreement, the aggregate number of shares of New Class A Common Stock beneficially owned by theholder (together with its affiliates, any other persons acting as a group together with the holder or any of the holder’s affiliates,and any other persons whose beneficial ownership of New Class A Common Stock would or could be aggregated with the holder’s forpurposes of Section 13(d) or Section 16 of the Exchange Act) would exceed 9.99% of the number of shares of New Class A Common Stock outstandingimmediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of such warrant.

The Company has agreedto make certain payments to the May 2025 Subscribers as liquidated damages and not as a penalty upon failure to deliver shares of NewClass A Common Stock upon exercise of the May 2025 Pre-Funded Warrants in accordance with the terms of the May 2025 Pre-Funded Warrants.

May 2025 TraditionalWarrants

Each May 2025 TraditionalWarrant to be issued in the May 2025 Private Placement will have an exercise price of $1.35 per share, will be exercisable immediatelyupon issuance and until the May 2025 Traditional Warrants expire on the first anniversary of the Outside Effectiveness Date.

The May 2025 TraditionalWarrants include customary anti-dilution adjustments.

Under the terms of theMay 2025 Traditional Warrants, the Company may not effect the exercise of any such warrant, and a holder will not be entitled to exerciseany portion of any such warrant, if, upon giving effect to such exercise and unless otherwise elected by such May 2025 Subscriber pursuantto their May 2025 Subscription Agreement, the aggregate number of shares of New Class A Common Stock beneficially owned by the holder(together with its affiliates, any other persons acting as a group together with the holder or any of the holder’s affiliates, andany other persons whose beneficial ownership of New Class A Common Stock would or could be aggregated with the holder’s for purposesof Section 13(d) or Section 16 of the Exchange Act would exceed 9.99% of the number of shares of New Class A Common Stock outstandingimmediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of such warrant.

The Company has agreedto make certain payments to the May 2025 Subscribers as liquidated damages and not as a penalty upon failure to deliver shares of ClassA common stock upon exercise of the May 2025 Traditional Warrant in accordance with the terms of the May 2025 Traditional Warrant.

The foregoing descriptionof the May 2025 Subscription Agreements, the May 2025 Pre-Funded Warrants, and the May 2025 Traditional Warrants does not purport to becomplete and is qualified in its entirety by reference to the forms of the May 2025 Subscription Agreements, the May 2025 Pre-Funded Warrants,and the May 2025 Traditional Warrants, which are filed as Exhibit 10.3, Exhibit 4.1, and Exhibit 4.2, respectively, and incorporated byreference.

Executive Compensation

On April 28, 2025, the Compensation Committee (the “Compensation Committee”) of the board of directors of the Company approved annual cash bonuses for 2025 for certain executive officers. Arshia Sarkhani, the Company’s Chief Executive Officer and President, Matthew Krueger, the Company’s Chief Financial Officer, Secretary and Treasurer, and Michael Gaubert, the Company’s Executive Chairman, was granted a cash bonus of $75,000 each. Kyle Fairbanks, the Company’s Executive Vice-Chairman and Chief Marketing Officer, and Arman Sarkhani was granted a cash bonus of $25,000 each. In addition, Jackson Fairbanks, the Director of Socials and an employee of the Company, was granted a cash bonus of $25,000. Each of the foregoing individuals is eligible to receive an annual cash bonus as determined by the Company’s board or the Compensation Committee pursuant to their respective employment agreement or consulting agreement.

Executive Employment and Consulting Agreements

On March 27, 2025, the Company entered into a letter agreement betweenthe Company and Arshia Sarkhani, the Company’s Chief Executive Officer and President, dated as of March 27, 2025 (the “NewArshia Sarkhani Agreement”). Under the New Arshia Sarkhani Agreement, Mr. Sarkhani will remain employed by the Company for a termthat began on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its terms or extended by mutualwritten agreement. For the period beginning on the day following the date of the termination of the Company’s previous letter agreement,dated as of April 21, 2022, between the Company and Mr. Sarkhani (the “Prior Arshia Sarkhani Employment Agreement”), and endingon April 1, 2027, the Company will pay Mr. Sarkhani an annual salary of $240,000. Pursuant to the New Arshia Sarkhani Agreement, the Companyalso paid Mr. Sarkhani an immediate cash bonus of $25,000. Mr. Sarkhani will also be eligible to receive an annual cash bonus as determinedby the Company’s board of directors or the Compensation Committee.  Subject to the approval by the Company’s stockholdersof an amendment to the Asset Entities Inc. 2022 Equity Incentive Plan (the “Plan”) to increase the number of shares of theExisting Class B Common Stock available for grant under the Plan, and further subject to the approval of the board or the CompensationCommittee, Mr. Sarkhani will be granted an award of shares of Existing Class B Common Stock under the Plan in an amount to be determinedby the board or the Compensation Committee pursuant to a restricted stock award agreement (the “Sarkhani Award Agreement”).The shares will vest equally over two years on each anniversary of the Sarkhani Award Agreement subject to Mr. Sarkhani’s continuousservice. Upon a change of control of the Company, all of the shares will vest immediately. The Sarkhani Award Agreement will also containnon-competition and non-solicitation provisions. Under the New Arshia Sarkhani Agreement, Mr. Sarkhani will be eligible to participatein standard benefits plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generallyapplicable Company policies. The New Arshia Sarkhani Agreement also contains certain confidentiality provisions. The Company may terminateMr. Sarkhani for “cause” as defined in the New Arshia Sarkhani Agreement. If the Company terminates Mr. Sarkhani without cause,the Company will be required to pay Mr. Sarkhani a separation fee of $240,000.

On March 27, 2025, the Company entered into a letter agreement betweenthe Company and Matthew Krueger, the Company’s Chief Financial Officer, Treasurer and Secretary, dated as of March 27, 2025 (the“New Krueger Agreement”). Under the New Krueger Agreement, Mr. Krueger will remain employed by the Company for a term thatbegan on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its terms or extended by mutual writtenagreement. For the period beginning on the day following the date of the termination of the Company’s previous letter agreement,dated April 21, 2022, between the Company and Mr. Krueger (the “Prior Krueger Agreement”), and ending on April 1, 2027, theCompany will pay Mr. Krueger an annual salary of $180,000. Pursuant to the New Krueger Agreement, the Company also paid Mr. Krueger animmediate cash bonus of $50,000. Mr. Krueger will also be eligible to receive an annual cash bonus as determined by the board or the CompensationCommittee.  Subject to the approval by the Company’s stockholders of an amendment to the Plan to increase the number of sharesof Existing Class B Common Stock available for grant under the Plan, and further subject to the approval of the board or the CompensationCommittee, Mr. Krueger will be granted an award of shares of Existing Class B Common Stock under the Plan in an amount to be determinedby the board or the Compensation Committee pursuant to a restricted stock award agreement (the “Krueger Award Agreement”).The shares will vest equally over two years on each anniversary of the Krueger Award Agreement subject to Mr. Krueger’s continuousservice. Upon a change of control of the Company, all of the shares will vest immediately. The Krueger Award Agreement will also containnon-competition and non-solicitation provisions. Under the New Krueger Agreement, Mr. Krueger will be eligible to participate in standardbenefits plans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicableCompany policies. The New Krueger Agreement also contains certain confidentiality provisions. The Company may terminate Mr. Krueger for“cause” as defined in the New Krueger Agreement. If the Company terminates Mr. Krueger without cause, the Company will berequired to pay Mr. Krueger a separation fee of $180,000.

On March 27, 2025, the Company entered into aletter agreement between the Company and Kyle Fairbanks, the Company’s Executive Vice-Chairman and Chief Marketing Officer, datedas of March 27, 2025 (the “New Kyle Fairbanks Agreement”). Under the New Kyle Fairbanks Agreement, Mr. Fairbanks will remainemployed by the Company for a term that began on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance withits terms or extended by mutual written agreement. For the period beginning on the day following the date of the termination of the Company’sprevious letter agreement, dated April 21, 2022, between the Company and Mr. Fairbanks (the “Prior Kyle Fairbanks Agreement”),and ending on April 1, 2027, the Company will pay Mr. Fairbanks an annual salary of $240,000. Pursuant to the New Kyle Fairbanks Agreement,the Company also paid Mr. Fairbanks a cash bonus of $10,000 on April 1, 2025. Mr. Fairbanks will also be eligible to receive an annualcash bonus as determined by the board or the Compensation Committee.  Subject to the approval by the Company’s stockholdersof an amendment to the Plan to increase the number of shares of Existing Class B Common Stock available for grant under the Plan, andfurther subject to the approval of the board or the Compensation Committee, Mr. Fairbanks will be granted an award of shares of ExistingClass B Common Stock under the Plan in an amount to be determined by the board or the Compensation Committee pursuant to a restrictedstock award agreement (the “Fairbanks Award Agreement”). The shares will vest equally over two years on each anniversary ofthe Fairbanks Award Agreement subject to Mr. Fairbanks’s continuous service. Upon a change of control of the Company, all of theshares will vest immediately. The Fairbanks Award Agreement will also contain non-competition and non-solicitation provisions. Under theNew Kyle Fairbanks Agreement, Mr. Fairbanks will be eligible to participate in standard benefits plans offered to similarly-situated employeesby the Company from time to time, subject to plan terms and generally applicable Company policies. The New Kyle Fairbanks Agreement alsocontains certain confidentiality provisions. The Company may terminate Mr. Fairbanks for “cause” as defined in the New KyleFairbanks Agreement. If the Company terminates Mr. Fairbanks without cause, the Company will be required to pay Mr. Fairbanks a separationfee of $240,000.

On March 27, 2025, the Company entered into aletter agreement between the Company and Arman Sarkhani, the Company’s Chief Operating Officer, dated as of March 27, 2025 (the“New Arman Sarkhani Agreement”). Under the New Arman Sarkhani Agreement, Mr. Sarkhani will remain employed by the Companyfor a term that began on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its terms or extendedby mutual written agreement. For the period beginning on the day following the date of the termination of the letter agreement betweenthe Company and Mr. Sarkhani, dated as of April 21, 2022, and ending on April 1, 2027, the Company will pay Mr. Sarkhani an annual salaryof $150,000. Pursuant to the New Arman Sarkhani Agreement, the Company also paid Mr. Sarkhani a cash bonus of $10,000 on April 1, 2025.Mr. Sarkhani will also be eligible to receive an annual cash bonus as determined by the board or the Compensation Committee.  Subjectto the approval by the Company’s stockholders of an amendment to the Plan to increase the number of shares of Class B Common Stockavailable for grant under the Plan, and further subject to the approval of the board or the Compensation Committee, Mr. Sarkhani willbe granted an award of shares of Existing Class B Common Stock under the Plan in an amount to be determined by the board or the CompensationCommittee pursuant to a restricted stock award agreement (the “Arman Sarkhani Award Agreement”). The shares will vest equallyover two years on each anniversary of the Arman Sarkhani Award Agreement subject to Mr. Sarkhani’s continuous service. Upon a changeof control of the Company, all of the shares will vest immediately. The Arman Sarkhani Award Agreement will also contain non-competitionand non-solicitation provisions. Under the New Arman Sarkhani Agreement, Mr. Sarkhani will be eligible to participate in standard benefitsplans offered to similarly-situated employees by the Company from time to time, subject to plan terms and generally applicable Companypolicies. The New Arman Sarkhani Agreement also contains certain confidentiality provisions. The Company may terminate Mr. Sarkhani for“cause” as defined in the New Arman Sarkhani Agreement. If the Company terminates Mr. Sarkhani without cause, the Companywill be required to pay Mr. Sarkhani a separation fee of $150,000.

On March 27, 2025, the Company entered into an engagement letter betweenthe Company and Michael Gaubert, the Company’s Executive Chairman, dated as of March 27, 2025 (the “New Gaubert Agreement”).Under the New Gaubert Agreement, Mr. Gaubert will continue to provide services to the Company for a term that began on April 1, 2025 andwill end on April 1, 2027 unless terminated earlier in accordance with its terms or extended by mutual written agreement. For the periodbeginning on the day following the date of the termination of the Company’s previous engagement letter, dated April 21, 2022, betweenthe Company and Mr. Gaubert (the “Prior Gaubert Agreement”), and ending on April 1, 2027, the Company will pay Mr. Gauberta monthly fee of $20,000. Pursuant to the New Gaubert Agreement, the Company also paid Mr. Gaubert an immediate cash fee of $75,000. Mr.Gaubert will be eligible to receive additional cash payments as determined by the Company. Mr. Gaubert will also be reimbursed for allpreapproved costs and expenses reasonably incurred in the performance of his services to the Company. Subject to the approval by the Company’sstockholders of an amendment to the Plan to increase the number of shares of Existing Class B Common Stock available for grant under thePlan, and further subject to the approval of the board or the Compensation Committee, Mr. Gaubert will be granted an award of shares ofExisting Class B Common Stock under the Plan in an amount to be determined by the board or the Compensation Committee pursuant to a restrictedstock award agreement (the “Gaubert Award Agreement”). The shares will vest equally over two years on each anniversary ofthe Gaubert Award Agreement subject to Mr. Gaubert’s continuous service. The Gaubert Award Agreement will also contain non-competitionand non-solicitation provisions. Upon a change of control of the Company, all of the shares will vest immediately. Under the New GaubertAgreement, Mr. Gaubert will be eligible to participate in standard benefits plans offered to similarly-situated employees by the Companyfrom time to time, subject to plan terms and generally applicable Company policies. The New Gaubert Agreement also contains certain confidentialityprovisions. The New Gaubert Agreement may be terminated by either party upon 30 days’ advance written notice. However, if eitherparty breaches a material obligation under the New Gaubert Agreement, and such breach continues for a period of ten days after the otherparty notifies the breaching party, the New Gaubert Agreement may be terminated immediately by notice to the breaching party. In addition,if the Company commits such a breach, or the Company terminates Mr. Gaubert in the absence of a material breach by Mr. Gaubert under theNew Gaubert Agreement, then any shares granted will vest immediately, any shares due will be granted and vest immediately, and the Companywill be required to pay Mr. Gaubert a separation fee of $240,000.

On March 27, 2025, the Company entered into a letter agreement, datedas of March 27, 2025, between the Company and Jackson Fairbanks, the Company’s Director of Socials and former Chief Marketing Officer(the “New Jackson Fairbanks Agreement”). Under the New Jackson Fairbanks Agreement, Mr. Fairbanks will remain employed bythe Company for a term that began on April 1, 2025 and will end on April 1, 2027 unless terminated earlier in accordance with its termsor extended by mutual written agreement. For the period beginning on the day following the date of the termination of the Company’sprevious letter agreement between the Company and Jackson Fairbanks, dated as of April 21, 2022, and ending on April 1, 2027, the Companywill pay Mr. Fairbanks an annual salary of $125,000. Pursuant to the New Jackson Fairbanks Agreement, the Company also paid Mr. Fairbanksa cash bonus of $10,000 on April 1, 2025. Mr. Fairbanks will also be eligible to receive an annual cash bonus as determined by the boardor the Compensation Committee. Subject to the approval by the Company’s stockholders of an amendment to the Plan to increase thenumber of shares of Existing Class B Common Stock available for grant under the Plan, and further subject to the approval of the boardor the Compensation Committee, Mr. Fairbanks will be granted an award of shares of Existing Class B Common Stock under the Plan in anamount to be determined by the board or the Compensation Committee pursuant to a restricted stock award agreement (the “JacksonFairbanks Award Agreement”). The shares will vest equally over two years on each anniversary of the Jackson Fairbanks Award Agreementsubject to Mr. Fairbanks’s continuous service. Upon a change of control of the Company, all of the shares will vest immediately.The Jackson Fairbanks Award Agreement will also contain non-competition and non-solicitation provisions. Under the New Jackson FairbanksAgreement, Mr. Fairbanks will be eligible to participate in standard benefits plans offered to similarly-situated employees by the Companyfrom time to time, subject to plan terms and generally applicable Company policies. The New Jackson Fairbanks Agreement also containscertain confidentiality provisions. The Company may terminate Mr. Fairbanks for “cause” as defined in the New Jackson FairbanksAgreement. If the Company terminates Mr. Fairbanks without cause, the Company will be required to pay Mr. Fairbanks a separation fee of$125,000.

Under the letter agreement between the Company and Jason Lee, the Company’sChief Technology Officer, dated as of November 10, 2023 (the “Lee Agreement”), the term of the agreement commenced as of November15, 2023, and will continue for two years unless terminated earlier in accordance with its terms. During the term of the Lee Agreement,the Company will pay Mr. Lee an annual salary of $100,000. Pursuant to the Lee Agreement, the Company entered into its standard form ofrestricted stock award agreement with Mr. Lee granting restricted stock under the Plan in the amount of 35,400 shares of Class B CommonStock subject to vesting as to one-fourth of the total granted shares on each of the first four six-month anniversaries of the grant date.Under the Lee Agreement, Mr. Lee will be eligible to participate in standard benefits plans offered to similarly-situated employees bythe Company from time to time, subject to plan terms and generally applicable Company policies. The Lee Agreement also contains certainconfidentiality provisions. Mr. Lee may terminate the Lee Agreement at will.

Each of the executive officers named above wasrequired to sign an Employee Confidential Information and Inventions Assignment Agreement or an Independent Contractor Confidential Informationand Inventions Assignment Agreement which prohibits unauthorized use or disclosure of the Company’s proprietary information, containsa general assignment of rights to inventions and intellectual property rights, non-competition provisions that apply during the term ofemployment or services, non-solicitation provisions that apply during the term of employment or services and for one year after the termof employment or services, and non-disparagement provisions that apply during and after the term of employment or services.

Private Placements of Series A PreferredStock

Under a Securities PurchaseAgreement, dated as of May 24, 2024, as amended by a First Amendment to Securities Purchase Agreement, dated as of June 13,2024 (as amended, the “Ionic Purchase Agreement”), between the Company and Ionic Ventures, LLC, a California limited liabilitycompany (“Ionic”), the Company agreed to the issuance and sale of up to 330 shares of the Company’s newly designatedSeries A Preferred Stock for maximum gross proceeds of $3,000,000. The shares of the Series A Preferred Stock are convertibleinto shares of Existing Class B Common Stock. Pursuant to the Ionic Purchase Agreement, the Company was required to issue and sell165 shares of Series A Preferred Stock at each of two closings subject to the satisfaction of the terms and conditions for each closing.

The first closing (the “First Ionic Closing”)occurred on May 24, 2024 for the issuance and sale of 165 shares of Series A Preferred Stock for gross proceeds of $1,500,000. The secondclosing (the “Second Ionic Closing”), for the issuance and sale of 165 shares of Series A Preferred Stock for gross proceedsof $1,500,000, was required to occur on the first business day on which the conditions specified in the Ionic Purchase Agreement for theSecond Ionic Closing were satisfied or waived. On July 29, 2024, the conditions to the occurrence of theSecond Ionic Closing were met. As a result, on July 29, 2024, the Company issued and sold 165 shares of Series A Preferred Stock to Ionicfor gross proceeds of $1,500,000.

The Companyhas received confirmation from Ionic that it will invest up to an additional $3 million upon request by the Company. Any such investmentwill be subject to the negotiation and entry into additional or amended definitive agreements.

Compensation to BousteadSecurities, LLC

In connection with eachof the First Ionic Closing and the Second Ionic Closing, pursuant to the letter agreement, dated November 29, 2021, between the Companyand Boustead (the “Boustead Engagement Letter”) and the Underwriting Agreement, dated as of February 2, 2023, between theCompany and Boustead (as representative of the underwriters named therein) (the “Underwriting Agreement”), the Company wasrequired to pay Boustead a fee equal to 7% of the aggregate purchase price and a non-accountable expense allowance equal to 1% of theaggregate purchase price for the Series A Preferred Stock. On the date of the First Ionic Closing, we therefore paid Boustead a totalamount of $120,000. In addition, the Company was required to issue a warrant to Boustead for the purchase of 30,800 shares of ExistingClass B Common Stock, equal to 7% of the number of shares of Existing Class B Common Stock that may be issued upon conversion of the sharesof Series A Preferred Stock sold at the First Ionic Closing at the initial Conversion Price of $3.75 per share (the “May 2024 BousteadWarrant”). On the date of the Second Ionic Closing, we paid Boustead a total amount of $120,000. In addition, on the date of theSecond Ionic Closing, the Company was required to issue a warrant to Boustead for the purchase of 30,800 shares of Existing Class B CommonStock, equal to 7% of the number of shares of Existing Class B Common Stock that may be issued upon conversion of the shares of SeriesA Preferred Stock sold at the Second Ionic Closing at the initial Conversion Price of $3.75 per share (the “July 2024 Boustead Warrant”).

Pursuant to an Assignmentand Assumption Agreement, dated as of July 30, 2024, among Boustead, Sutter Securities, Inc., a registered broker-dealer and an affiliateof Boustead (“Sutter”), and the Company (the “First July 2024 Boustead Warrant Assignment Agreement”), all ofthe rights to the July 2024 Boustead Warrant were assigned by Boustead to Sutter. Pursuant to an Assignment and Assumption Agreement,dated as of July 30, 2024, among Sutter, Michael R. Jacks (the “Warrant Assignee”), Boustead, and the Company (the “SecondJuly 2024 Boustead Warrant Assignment Agreement”), all of the rights to the July 2024 Boustead Warrant were assigned by Sutter tothe Warrant Assignee, a registered representative of Sutter. Pursuant to the First July 2024 Boustead Warrant Assignment Agreement andthe Second July 2024 Boustead Warrant Assignment Agreement, the July 2024 Boustead Warrant was cancelled, and a warrant (the “July2024 Assignee Warrant”) was issued to the Warrant Assignee. The terms of the July 2024 Assignee Warrant were identical to those ofthe July 2024 Boustead Warrant.

The May 2024 BousteadWarrant and the July 2024 Boustead Assignee Warrant had an exercise price of $3.75 per share, subject to adjustment, five-year terms,and cashless exercise and piggyback registration rights. The May 2024 Boustead Warrant and the July 2024 Boustead Assignee Warrant wereeach fully exercised on a cashless basis.

ATM Financing

ATM Sales Agreement

On September 27, 2024,the Company entered into the ATM Sales Agreement with the Sales Agent. Under the terms of the ATM Sales Agreement, the Company may, fromtime to time, in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the SecuritiesAct, issue and sell through or to the Sales Agent, up to a maximum aggregate amount of $1,791,704 of shares of the Company’s ExistingClass B Common Stock (the “ATM Shares”). The issuance and sale of the ATM Shares to or through the Sales Agent from time totime will be effected pursuant to the Shelf Registration Statement and the prospectus supplement filed by the Company with the SEC onSeptember 30, 2024 relating to the offering of the ATM Shares and the accompanying base prospectus. In November 2024 and January 2025,the Company filed additional prospectus supplements to the base prospectus to increase the maximum gross proceeds to $5,489,399, as ofJune 30, 2025.

Pursuant to the ATM SalesAgreement, the Company may issue and sell the ATM Shares from time to time through or to the Sales Agent, acting as sales agent or principal,subject to the terms and conditions of the ATM Sales Agreement. The Company may instruct the Sales Agent to make such sales, and the SalesAgent, as agent, will use its commercially reasonable efforts to sell the ATM Shares within the parameters set forth in the Company’snotice to sell, and subject to the satisfaction of the Company’s obligations as set forth in the ATM Sales Agreement. The Companywill designate the parameters within which the ATM Shares must be sold, including at a minimum the number to be sold, the time periodduring which sales are requested to be made, any limitation on the number of the ATM Shares that may be sold in any one trading day, andany minimum price below which sales may not be made. The Company has no obligation to sell, and the Sales Agent is not obligated to buyor sell, any of the ATM Shares under the ATM Sales Agreement and may at any time suspend offers under the ATM Sales Agreement or terminatethe ATM Sales Agreement as provided for in the ATM Sales Agreement. The ATM Sales Agreement will automatically terminate upon the earlierto occur of (i) issuance and sale of all of the ATM Shares to or through the Sales Agent on the terms and subject to the conditions setforth therein and (ii) the expiration of the Shelf Registration Statement on the third anniversary of the initial effective date of theShelf Registration Statement pursuant to Rule 415(a)(5) under the Securities Act.

The Sales Agent may sellATM Shares by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 under the SecuritiesAct.

Unless otherwise agreedbetween the Company and the Sales Agent, settlement for sales of the ATM Shares will occur on the first trading day following the dateon which any sales are made. Sales of the ATM Shares will be settled through the facilities of The Depository Trust Company or by suchother means as the Company and the Sales Agent may agree. There is no arrangement for funds to be received in an escrow, trust or similararrangement.

The Company will paythe Sales Agent a cash commission of 3.0% of the gross sales price of the ATM Shares sold by the Sales Agent pursuant to the ATM SalesAgreement. Pursuant to the terms of the ATM Sales Agreement, the Company also agreed to reimburse the Sales Agent for reasonable feesand expenses, not to exceed $60,000 (including but not limited to the reasonable and documented fees and disbursements of its legal counsel),and additional amounts for annual maintenance of the ATM Sales Agreement (including but not limited to the reasonable and documented feesand disbursements of its legal counsel) on a quarterly basis, not to exceed $5,000 per quarter.

Each of the Company andthe Sales Agent has the right, by giving written notice as specified in the ATM Sales Agreement, to terminate the ATM Sales Agreementin its sole discretion at any time upon five (5) days’ prior written notice. The Sales Agent also has the right to terminate theATM Sales Agreement at any time in certain circumstances, including in the event of the occurrence of a material adverse change with respectto the Company, the failure of the Company to perform its obligations under the ATM Sales Agreement, any failure to fulfill any conditionto the obligations of the Sales Agent under the ATM Sales Agreement, or any suspension or limitation of trading of the ATM Shares.

The ATM Sales Agreementcontains certain covenants, representations and warranties customary for an agreement of this type. The Company agreed to provide indemnificationand contribution to the Sales Agent against certain liabilities, including liabilities under the Securities Act.

Since the commencementof the ATM Financing and as of June 30, 2025, a total of 5,427,700 shares has been sold, for net proceeds to the Company of $4,830,647.56,after paying $329,362 in compensation to the Sales Agent and the same amount to Boustead under the Boustead ATM Waiver.

This Quarterly Reporton Form 10-Q does not constitute an offer to sell or the solicitation of an offer to buy, and the ATM Shares cannot be sold in any stateor jurisdiction in which the offer, solicitation, or sale would be unlawful prior to registration or qualification under the securitieslaws of any state or jurisdiction. Any offer will be made only by means of a prospectus, consisting of a prospectus supplement and theaccompanying base prospectus, forming a part of the effective registration statement.

CriticalAccounting Policies and Estimates  

This discussion and analysis of our financialcondition and results of operations is based on our financial statements, which have been prepared in accordance with generally acceptedaccounting principles in the United States. The preparation of these financial statements requires us to make estimates and assumptionsthat affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of thefinancial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historicalexperience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis formaking judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results maydiffer from these estimates under different assumptions or conditions. While our significant accounting policies are described in moredetail in the notes to our financial statements included with this Quarterly Report on Form 10-Q, we believe that the following accountingpolicies are critical to understanding our historical and future performance, as these policies relate to the more significant areas involvingmanagement’s judgments and estimates. We believe our most critical accounting policies and estimates relate to the following:

Intangible Assets

Intangible assets acquired are recorded at fairvalue. We test our finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carryingvalue of the assets may not be recoverable. We test our indefinite-lived intangible assets for impairment annually or whenever eventsor changes in circumstances indicate that the carrying value of the assets may not be recoverable. If the carrying value exceeds the fairvalue, we recognize an impairment in an amount equal to the excess, not to exceed the carrying value. Management uses considerable judgmentto determine key assumptions, including projected revenue, royalty rates and appropriate discount rates. During the six months ended June30, 2025 and 2024, there were no intangible asset impairment charges.

Finite-lived intangible assets are amortized usingthe straight-line method over their estimated useful lives, which ranges from 5 to 15 years. Our finite-lived intangible assets includeacquired franchise agreements, acquired customer relationships, acquired customer lists, and internally developed software. Our indefinite-livedintangible assets include acquired domain names, trade names, and purchased software.

Intangible assets internally developed are measuredat cost. We capitalize costs to develop or purchase computer software for internal use which are incurred during the application developmentstage. These costs include fees paid to third parties for development services and payroll costs for employees’ time spent developingthe software. We expense costs incurred during the preliminary project stage and the post-implementation stage. Capitalized developmentcosts are amortized on a straight-line basis over the estimated useful life of the software. The capitalization and ongoing assessmentof recoverability of development costs requires considerable judgment by management with respect to certain external factors, including,but not limited to, technological and economic feasibility, and estimated economic life.

Impairment of Long-lived Assets Other ThanGoodwill

Long-lived assets with finite lives, primarilyproperty and equipment, intangible assets, and operating lease right-of-use assets are reviewed for impairment whenever events or changesin circumstances indicate that the carrying amount of an asset may not be recoverable. If the estimated cash flows from the use of theasset and its eventual disposition are below the asset’s carrying value, then the asset is deemed to be impaired and written downto its fair value.

Advertising Expenses

The Company expenses advertising costs as theyincurred. Total advertising expenses were $412,445 and $284,886 for the six months ended June 30, 2025 and 2024, respectively,and have been included as part of general and administrative expenses. 

Research and Development

Research and development costs are charged toexpense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and developmentcosts are expensed when the contracted work has been performed or as milestone results have been achieved as defined under the applicableagreement.

The Company incurred research and developmentexpenses of $182,484 and $238,739 for the six months ended June 30, 2025 and 2024, respectively, and have been included as partof contract labor.

Stock Based Compensation

Service-Based Awards

The Company records stock-based compensation forawards granted to employees, non-employees, and to members of the board for their services on the board based on the grant date fair valueof awards issued, and the expense is recorded on a straight-line basis over the requisite service period, which is generally one to threeyears.

For restricted stock awards (“RSAs”)issued under the Company’s stock-based compensation plans, the fair value of each grant is calculated based on the Company’sstock price on the date of grant.

Share Repurchase

Share repurchases are open market purchases. Sharerepurchases are generally recorded on the settlement date, as treasury stock. When shares are cancelled, the value of repurchased sharesis deducted from stockholders’ equity through common stock with the excess over par value recorded to accumulated deficit.

Revenue Recognition

The Company recognizes revenue utilizing the followingsteps: (i) Identify the contract, or contracts, with a customer; (ii) Identify the performance obligations in the contract; (iii) Determinethe transaction price; (iv) Allocate the transaction price to the performance obligations in the contract; (v) Recognize revenue whenthe Company satisfies a performance obligation.

Subscriptions

Subscription revenue is related to a single performanceobligation that is recognized over time when earned. Subscriptions are paid in advance and can be purchased on a monthly, quarterly, orannual basis. Any quarterly or annual subscription revenue is recognized as a contract liability recorded over the contracted serviceperiod.

Marketing

Revenue related to marketing campaign contractswith customers are normally of a short duration, typically less than two (2) weeks.

AE.360.DDM Contracts

Revenue related to AE.360.DDM contracts with customersare normally of a short duration, typically less than one (1) week.

Contract Liabilities

Contract liabilities consist of quarterly andannual subscription revenue that have not been recognized. Revenue under these agreements is recognized over the related service period.As of June 30, 2025 and December 31, 2024, total contract liabilities were $447 and $369 respectively. Contract liabilitiesare expected to be recognized as revenue over a period not to exceed twelve (12) months.

Changes in contract liabilities for the six monthsended June 30, 2025, are as follows:

Earnings per Shareof Common Stock

The Company has adopted Financial Accounting StandardsBoard (“FASB”) Accounting Standards Codification (“ASC”) Topic 260, “Earnings per Share” whichrequires presentation of basic earnings per share on the face of the statements of operations for all entities with complex capital structuresand requires a reconciliation of the numerator and denominator of the basic earnings per share computation. In the accompanying financialstatements, basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstandingduring the year. Diluted earnings per share is computed by dividing net income by the weighted average number of shares of common stockand potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur fromcommon stock issuable through contingent share arrangements, stock options and warrants unless the result would be antidilutive. TheCompany would account for the potential dilution from convertible securities using the as-if converted method. The Company accounts forwarrants and options using the treasury stock method.

As of June 30, 2025, warrants representing 31,500 sharesof common stock equivalents were excluded from the computation from diluted net loss per share as the result was anti-dilutive.

Commitments and Contingencies

The Company follows ASC 450-20, “LossContingencies”, to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments,litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount ofthe assessment can be reasonably estimated. As of June 30, 2025 and December 31, 2024, the Company did not have any commitments and contingencies.

Segment Reporting

The Company operates as one operatingsegment. The Company’s chief operating decision maker (“CODM”) is its chief executive officer, who reviews the operating resultsfor the Company as a whole to make decisions about allocating resources and assessing financial performance. The CODM uses operating marginand net income to assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operatingdecisions, such as the determination of the rate at which the Company seeks to grow operating margin, the allocation of budget betweenoperating expenses and the management and forecasting of cash to ensure enough capital is available. Accordingly, we determined we operatein a single reporting segment.

Our CEO assesses performance and decides how toallocate resources primarily based on net income, which is reported on our Statements of Operations. Total assets on the Balance Sheetsrepresent our segment assets.

Recent Accounting Pronouncements

InNovember 2024, the Financial Accounting Standards Board issued ASU 2024-03 final standardon Income Statement: Disaggregation of Income Statement Expenses, which requires disaggregated disclosure of income statement expensesfor public business entities. The ASU does not change the expense captions an entity presents on the face of the income statement; rather,it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financialstatements. This guidance will be effective for us on January 1, 2027.

The Company has consideredall other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impacton its financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

ITEM 4. CONTROLSAND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of ourChief Executive Officer and Chief Financial Officer, has evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e)and 15d-15(e) under the Exchange Act) prior to the filing of this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief ExecutiveOfficer and Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosurecontrols and procedures were, in design and operation, effective at a reasonable assurance level.

Changes in Internal Control Over FinancialReporting

There were no changes in our internal controlover financial reporting during the three months ended June 30, 2025 that have materially affected, or are reasonably likely to materiallyaffect, our internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

From time to time, we may become involved in variouslawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties,and an adverse result in these, or other matters, may arise from time to time that may harm our business. We are not currently aware ofany such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operatingresults.

ITEM 1A. RISK FACTORS.

Thereare no material changes from the risk factors previously disclosed in Item 1A “Risk Factors” of our Annual Report on Form10-K for the fiscal year ended December 31, 2024.  

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

Unregistered Sales of Equity Securities

During the three months ended June 30, 2025, wedid not sell any equity securities that were not registered under the Securities Act and that were not previously disclosed in a CurrentReport on Form 8-K.

Purchases of Equity Securities

No repurchases of Common Stock by the Companyoccurred during the three months ended June 30, 2025.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

We have no information to disclose that was requiredto be disclosed in a Current Report on Form 8-K during the three months ended June 30, 2025 but was not reported.

None of our directors or “officers,”as defined in Rule 16a-1(f) under the Exchange Act, adopted or terminated a Rule 10b5-1 trading plan or arrangement or a non-Rule 10b5-1trading plan or arrangement, as defined in Item 408(c) of Regulation S-K, during the fiscal quarter ended June 30, 2025.

ITEM 6. EXHIBITS.

SIGNATURES

Pursuant to the requirementsof the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereuntoduly authorized.