MITI 10-K
Mitesco, Inc. (MITI)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
For the fiscal year ended
OR
For the transition period from to
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Securities registered pursuant to Section 12(b) of the Act:
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Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.01 Par Value
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The aggregate market value of the voting and non-voting
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the last business day of the registrant’s most recently completed second fiscal quarter, was $
As of April 13, 2026, the registrant had outstanding
DOCUMENTS INCORPORATED BY REFERENCE:
MITESCO, INC.
TABLE OF CONTENTS
i
SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION
As used in this Annual Report on Form 10-K (this “Annual Report”), unless indicated or the context requires otherwise, the terms the “Company”, “Mitesco” or “MITI” refer to Mitesco, Inc., and its subsidiaries.
In addition to historical information, this Annual Report contains forward-looking statements. The forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in such forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in the sections entitled “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s opinions only as of the date hereof. We undertake no obligation to revise or release the results of any revision of these forward-looking statements. Readers should carefully review the risk factors described in this Annual Report and in other documents that we file from time to time with the Securities and Exchange Commission (the “SEC” or the “Commission”).
You can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other “forward-looking” information. There may be events in the future that we are not able to accurately predict or control. You should be aware that the occurrence of any of the events described in these risk factors and elsewhere in this Annual Report could harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance, or achievements.
Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this Annual Report.
We cannot give any guarantee that these plans, intentions, or expectations will be achieved. All forward-looking statements involve risks and uncertainties, and actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those factors described in the “Risk Factors” section of this Annual Report. Moreover, new risks emerge from time to time, and it is not possible for our management to predict all risks, nor can we assess the impact of all risks on our business or the extent to which any risk, or combination of risks, may cause actual results to differ from those contained in any forward-looking statements. All forward-looking statements included in this Annual Report are based on information available to us on the date of this Annual Report. Except to the extent required by applicable laws or rules, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained throughout this Annual Report.
Summary Risk Factors
Our business and our ability to execute our business strategy are subject to a number of risks which you should be aware of before you decide to invest in our Company. The following is a summary of our key risks. A more detailed description of each of the risks can be found below in section entitled “Risk Factors”.
Risks Related to our Business
| ● | We are in the initial stages of our present business plan and have a limited historical performance for you to base an investment decision upon, and we may never become profitable. |
| ● | Disruption or breach of our security measures or those of our third-party datacenter hosting facilities, cloud computing platform providers or third-party service partners, or the underlying infrastructure of the Internet, and unauthorized access to obtain customer’s data, our data or our IT systems, could lead to curtailment of our customers who may stop using our services, and we may incur significant reputational harm, legal exposure and liabilities, or a negative financial impact. | |
| ● | The success of our business is dependent on subscription and renewal of our services by customers. | |
| ● | We may be unable to attract and retain sufficient numbers of qualified personnel. | |
| ● | We may become involved in legal proceedings. |
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| ● | We may not manage our strategy effectively. Rapid technological change in our industry presents us with significant risks and challenges. | |
| ● | We are in an intensely competitive industry and there is no assurance we will be able to compete with our competitors who have greater resources than us. | |
| ● | Rapid technological change in our industry presents us with significant risks and challenges. |
Risks Related to our Financial Condition
| ● | There is substantial doubt about our ability to continue as a going concern. | |
| ● | If we are unable to generate significant revenue, we may need to raise additional capital which may not be available to us on acceptable terms or at all. | |
| ● | We may incur additional debt in the future which may contain restrictive covenants. | |
| ● | We have identified weaknesses in our internal controls, and we cannot provide assurances that these weaknesses will be effectively remediated or that additional material weaknesses will not occur in the future. | |
| ● | The issuance of additional shares of our Common Stock, or securities convertible into shares of our Common Stock, may dilute the percentage ownership of our existing stockholders and may make it more difficult to raise additional capital. | |
| ● | Our operating results and liquidity needs could be negatively affected by market fluctuations and economic downturns | |
| ● | Settlements with various leaseholders and vendors have created obligations that may hinder our ability to finance future operations |
Risks Related to Government Regulation
| ● | Privacy concerns and laws as well as evolving regulation of cloud computing, AI services, cross-border data transfer restrictions and other domestic regulations may limit the use and adoption of our services and adversely affect our business. | |
| ● | Industry-specific regulations and other requirements and standards are evolving, and unfavorable industry-specific laws, regulations, interpretive positions or standards could harm our business. | |
| ● | If the statutes and regulations in our industry change, we could be negatively impacted. |
Risks Related to Acquisitions
| ● | Acquisitions may subject us to liability with regard to the creditors, customers, and shareholders of the sellers. | |
| ● | We may be unable to implement our strategy of acquiring companies. | |
| ● | Future acquisitions may result in potentially dilutive issuances of equity securities, incurrence of additional indebtedness and increased amortization expenses. | |
| ● | We face risks arising from acquisitions that we may pursue in the future. |
Risks Related to our Management
| ● | Our success is dependent, in part, on the performance and continued service of certain of our officers and directors. |
Related to Ownership of our Common Stock
| ● | Our executive officers, directors and certain key stockholders own and control a significant number of voting securities and so long as they do, they are able to control the outcome of stockholder voting. |
iii
Related to Ownership of our Common Stock
| ● | Shares eligible for future sale may have adverse effects on our share price. | |
| ● | If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline. |
| ● | Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future, and as a result, investors in our Common Stock could incur substantial losses. | |
| ● | Because we may issue preferred stock without the approval of our shareholders and have other anti-takeover defenses, it may be more difficult for a third party to acquire us and could depress our stock price. | |
| ● | Offers or availability for sale of a substantial number of shares of our Common Stock may cause the price of our Common Stock to decline. | |
| ● | We do not intend to pay any cash dividends on our Common Stock in the near future therefore investors will not be able to receive a return on their shares unless they sell the shares at a higher price than their purchase price. | |
| ● | Our Common Stock is often thinly traded and may prevent you from selling at or near asking prices, if at all. |
Risks Related to Debt Restructuring
| ● | Redemption of all shares of Series A Preferred Stock into Common Stock may lead to severe dilution of our existing shares. | |
| ● | Resales of our Common Stock in the public market by our stockholders may cause the market price of our Common Stock to fall. | |
| ● | Investors who buy shares at different times will likely pay different prices. |
Risks Related to Cybersecurity
| ● | If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, or are perceived to have been compromised, we could experience adverse consequences, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; loss of customers or sales; and other adverse consequences. | |
| ● | We face the risk of unauthorized access to or breaches of our information systems. | |
| ● | Operations and Finances may be impacted by a cybersecurity breach of our information system. | |
| ● | We face challenges in detection and response of cybersecurity breaches. |
Additional Information
Our principal executive office is located at 505 Beachland Blvd., Suite 1-377, Vero Beach, Florida 32963. Our telephone number is (844) 383-8689. The SEC maintains an internet site on www.sec.gov where reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC are available. We file our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports with the SEC on the above-mentioned site. Our website is www.mitescoinc.com. The information contained therein or connected thereto is not intended to be incorporated into this filing.
Implications of Being a Smaller Reporting Company
We are a “smaller reporting company” as defined in the Exchange Act. We may take advantage of certain of the scaled disclosures available to smaller reporting companies so long as the market value of our voting and non-voting Common Stock held by non-affiliates is less than $250.0 million measured on the last business day of our most recently completed second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our Common Stock held by non-affiliates is less than $700.0 million measured on the last business day of our most recently completed second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparisons of our financial statements with other public companies difficult or impossible.
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PART I
ITEM 1. BUSINESS
This summary highlights selected information contained elsewhere in this filing and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this report. It does not contain all the information that may be important to you and your investment decision. You should carefully read this entire filing, including the matters set forth under the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and related notes. In this prospectus, unless context requires otherwise, references to “we,” “us,” “our,” or “the Company” refer to Mitesco, Inc. and its subsidiaries.
Corporate Organizational Chart
Company Overview
Mitesco, Inc. (the “Company,” “we,” “us,” or “our”) was formed in the state of Delaware on January 18, 2012. On December 9, 2015, we restructured our operations and acquired Newco4pharmacy, LLC, a development stage company which sought to acquire compounding pharmacy businesses. As a part of the restructuring, we shut down our former business line. On April 24, 2020, we changed our name to Mitesco, Inc. In October 2023, the Company changed its domicile from Delaware to Nevada in order to effect reduced costs.
From 2020 through 2022, our operations were focused on establishing general practice medical clinics utilizing nurse practitioners under The Good Clinic name and development and acquisition of telemedicine technology. We opened our first The Good Clinic in Minneapolis, Minnesota in the first quarter of 2021 and had six operating clinics during the year ended December 31, 2022, with two additional sites under contract. In the fourth quarter of fiscal 2022, we made the strategic decision to close the entire clinic operation and release our staff due to a lack of profitability. The majority of the holders of Series D and F Preferred stock, promissory notes and accounts payable discussed herein, were investors, lenders and vendors to the Company during the operation of the clinic business and have now received either restricted common stock, or the Series A Preferred shares in consideration of the cancelation of, or in exchange for, the previous obligations. The financial results and obligations are now accounted for as “discontinued operations”. For details see “Debt Restructuring” herein.
Current Business Operations
We are a holding company seeking to provide products, services and technology.
In June 2024 we announced the formation of two (2) new wholly owned business units, Centcore, LLC (“Centcore”) that is providing data center services including cloud computing and application hosting, and Vero Technology Ventures, LLC (“VTV”), whose aim is to seek investment and acquisition opportunities, generally in the areas of cloud computing and data center related applications.
Centcore has two (2) areas of focus. The first, generic data center services, is aimed at hosting applications for a specific user, sometimes referred to as “managed services offerings” or MSO, where the client moves the software licensed from various vendors, or internally developed, into our data center where we maintain the computing, communications and backup environment. We currently offer services through a “co-location” agreement with a data center based in Melbourne, Florida, which has relationships with eight (8) other data centers worldwide. Using this approach, we have an ability to rapidly expand the size of our computing resources quickly, at minimal expense. Over time we expect to create similar situations with other data centers worldwide based on our clients’ specific needs. We are also evaluating the development of a network of smaller format (5,000 to 10,000 square foot) data centers inside of existing facilities. We believe that this approach may allow us to expand capacity with minimal capital expenditure. The existing facilities we are targeting generally have sufficient power, often with a substation nearby. These types of buildings usually have backup generators, HVAC, water and security in a form that would support a data center environment.
We have retained experienced professionals in the data center, cyber security and infrastructure services areas to support our needs on a per hour basis, which we believe will allow us to control our costs relative to business activity, without significant staffing internally.
1
The Vero Technology Ventures (VTV) subsidiary is actively reviewing potential early-stage cloud computing solution vendors and is developing its own artificial intelligence (A.I.) based application set. VTV is currently involved with the formation of a new software development project aimed at applying artificial intelligence (A.I.) to the sales process for various businesses, including residential real estate using cloud computing based software. This initial effort dubbed “Robo Agent”, is expected to be available for initial users in Q3 of FY2026. Later versions may include similar functionality focused on other markets, generally in a “business to consumer” (B2C) selling situation.
In August 2025 we retained a highly qualified executive to begin development of our Robo Agent product set on a consulting basis at a rate of $10,000 per month. We have also recruited three (3) additional contract programmers to accelerate the overall process. In September 2025 we received a contract for development of a new application intended to effect the listing and sale of properties and products specifically related to sports, and the pickleball arena initially. We expect this project to be executed using both internal and external resources and to be completed in late FY2026.
There are several other projects in evaluation, generally aimed at software that would operate on a cloud computing platform such as that which the Company has in its Centcore Data Center.
FY2024 Debt Restructuring
From FY2021 until late FY2022 the Company invested in an operating subsidiary, The Good Clinic, which was developing a series of primary care healthcare facilities. In late FY2022, as a result of a lack of adequate revenues and limited funding, it ceased operations. As of June 30, 2024, the Company had over $30 million in senior securities, notes and accounts payable related to that discontinued operation. In order to clear those obligations management began a restructuring which involved negotiations to reduce the overall debt, converting the obligations of certain accredited institutional investors into a newly created Series A Amortizing Preferred stock (“Series A Preferred”), and others into restricted common stock using a price per share of $4.00.
As of the date of this filing it has converted approximately $26 million of its obligations, representing approximately $21.7 million of its senior securities, and approximately $4.3 million of notes and accounts payable, into 2,628,179 shares of restricted Common Stock, and 562,998 Series A Preferred stock (before giving effect to redemptions made in Q1, Q2 and Q3 FY2025). The Series A Preferred stock is held by six (6) accredited institutional investors, while over 40 holders of obligations of the Company elected to receive common stock using the $4 per share valuation.
Additionally, effective December 31, 2024, the Company has entered into Obligation Exchange Agreements pursuant to which it has converted $580,132, including $32,132 of principal and interest, of its 2024 Bridge Notes into Series A Preferred share, which resulted in the issuance of 23,206 shares of Series A Preferred shares to three (3) of its institutional investors. This extinguishes $580,132 of its short-term debt. As of the date of this filing all FY2024 bridge notes have been extinguished.
The FY2024 Debt Restructuring continued through the following actions during FY2025:
| ● | The Q1 FY2025 redemptions of Series A Preferred stock resulted in the issuance of 1,366,394 shares of common stock, and the redemption of 20,098 shares of Series A Preferred stock; |
| ● | During Q1 FY2025 a total of 4,000 new shares of Series A Preferred stock were issued for consideration of $100,000; |
| ● | The Q2 redemptions of Series A Preferred stock resulted in the issuance of 402,450 shares of common stock issued, and the redemption of 4,052 shares of Series A Preferred stock; |
| ● | No new shares of Series A Preferred shares were issued during Q2 FY2025; |
| ● | The Q3 FY2025 redemptions of Series A Preferred stock resulted in the issuance of 2,025,910 shares of common stock, and the redemption of 10,308 shares of Series A Preferred stock |
| ● | During Q3 a total of 1,000 shares of Series A Preferred stock were issued for total consideration of $25,000. |
2
As part of the restructuring, the Company agreed to register shares of Common Stock issued and to be issued to Series A Preferred Stockholders.
Also, key to the restructuring:
On October 31, 2025, the Company entered into a Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “October 2025 Bridge Note”) with C/M Capital Master Fund, L.P. with a potential total funding of $1 million, with an initial funding of $250,000. Under the terms of the 18 month note, the Company is obligated to repay a total of $275,000 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the 2025 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets.
On December 19, 2025, the Company entered into a second Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “December 2025 Bridge Note”) with C/M Capital Master Fund, L.P. and WVP Emerging Manager Onshore Fund, LLC, with a potential total funding of $1 million, with an additional funding of $250,000. Under the terms of the 18 month note, the Company is obligated to repay a total of $275,000 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the 2025 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets.
Competition
We are in the early stage of developing our data center business, and while we believe there is a very large, and growing market for our offerings, there are also many competitors with significant experience and client base, of varying size. We believe our technology and services approach will be able to compete with other technology and services providers. We face competition primarily from:
| ● | In-house IT departments of our customers and potential customers provide services for their respective organizations but typically need help scaling large technology environments and maximizing the value from their cloud investments, especially when speed, cost and innovation are key constraints. |
| ● | Traditional global IT systems integrators, such as Accenture, Atos, Capgemini, Cognizant, Deloitte, DXC Technology and IBM, offer consulting and outsourcing, in a labor-intensive model, for large enterprise customers. Many of these businesses largely support legacy technologies and, where cloud capabilities exist, legacy revenue streams disincentivize these companies from fully embracing cloud technologies. |
| ● | Cloud service providers and digital systems integrators provide either consultation and implementation services for digital workflows or cloud services for a single cloud vendor. The solutions offered by these companies are often narrow in scope and are not well-suited for companies with complex hybrid, multi-cloud objectives. |
| ● | Regional and national managed services providers use a local go-to-market approach, and provide cloud services such as AWS, Microsoft Azure and Google Cloud Platform (GCP). |
| ● | Colocation providers, such as Equinix, CyrusOne and QTS, provide secure environments for hardware and access to network connectivity. We believe that these companies provide limited services differentiation, and their customers do not benefit from the economics of cloud-based technologies. |
We believe the principal competitive factors in our market include, but are not limited to:
| ● | Focus on the cloud |
| ● | Technology and services expertise |
| ● | Customer experience |
| ● | Speed of innovation |
| ● | Strength of relationships with technology partners |
| ● | Automation and scalability |
| ● | Standardized operational processes |
| ● | Geographic reach |
| ● | Brand recognition and reputation |
| ● | Price |
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We aspire to compare favorably on the basis of the factors listed above. However, many of our competitors have: substantially greater financial, technical and marketing resources; relationships with large vendor partners; larger global presence; larger customer bases; longer operating histories; greater brand recognition; and more established relationships in the industry than we do. Furthermore, new entrants not currently considered to be competitors may enter the market through acquisitions, partnerships or strategic relationships.
We cannot be assured that we will be able to compete in any of the markets in which we intend to operate. This could cause you to lose your investment.
Our Competitive Strengths
We believe the following strengths and market dynamics provide us with a competitive advantage. As additional capital is available to the Company, we will pursue the acquisition of existing healthcare services and technology business, and we may consider opening new clinics using our revised and less capital-intensive approach going forward:
| ● | Experienced team - with a proven track record of growing businesses both organically and through acquisition. |
| ● | Public company experience – solid knowledge of the equity markets and participants in the financing of public companies. |
| ● | Compliance experience – extensive securities law experience and in SEC reporting. |
| ● | Knowledge of audit and accounting requirements – any acquisition into a publicly held company must be able to be fully audited according to PCOAB standards. |
| ● | We have an Advisory Board which includes participants with significant experience and who are compensated through the issuance of restricted stock so as to align their interests with those of the shareholders. |
Management/Human Capital
As of the date of this Annual Report, we have no full-time employees, rather our needs are being met from the efforts of our directors and a number of individuals under consulting or advisory agreements including accounting, SEC reporting, legal, sales, systems operation and software development.
We do not now, or expect in the near term, to provide any benefits to our employees, advisors or consultants. We have historically provided incentive stock options and other equity incentives to officers, directors and key employees to provide ownership and alignment of interests with our shareholders, however in January 2024, the Board of Directors terminated the Mitesco Omnibus Securities and Incentive Plan so currently it has no active stock incentive plans. During FY2024 the Company compensated members of its Board of Directors and its Advisory Board with restricted stock issuances and expects to continue that practice going forward based on performance. During FY 2025, the members of the Board elected for forgo all compensation. During the FY 2025 the one-year term of the Advisory Board members expired and they were not extended further.
We believe that the Company’s management team will remain relatively small in the near term and should consist of a team with experience in 1) public company accounting and finance, 2) software and systems, 3) brand marketing, and 4) public equities financing.
As of December 31, 2025, none of our employees were represented by a union or covered by a collective bargaining agreement. We have not experienced any work stoppages, and we consider our relationship with our employees to be good.
Government Regulation
We are subject to a wide range of laws, regulations, and legal requirements in the U.S., including those that may apply to our products and online services offerings, and those that impose requirements related to user privacy, data storage and protection, cybersecurity, and as the role of regulation evolves, AI. For information about governmental regulations applicable to our business, refer to Risk Factors included elsewhere in this filing.
If there are changes in laws, regulations, or administrative or judicial interpretations, we may have to change our future business practices, or our business practices could be challenged as unlawful, which could have a material adverse effect on our business, financial condition, and results of operations. See the description below for certain of the laws, regulations, or administrative or judicial interpretations that we are currently subject to and the “Risk Factors” section.
4
Recent Developments
On October 31, 2025, Mitesco, Inc. ( the “Company”) entered into a Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “2025 Bridge Note”) with C/M Capital Master Fund, L.P. with a potential total funding of $1 million, with an initial funding of $250,000. Under the terms of the 18 month note, the Company is obligated to repay a total of $275,000 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the 2025 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets.
On December 19, 2025, Mitesco, Inc. (the “Company”) entered into a second Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “2025 Bridge Note”) with C/M Capital Master Fund, L.P. and WVP Emerging Manager Onshore Fund, LLC, with a potential total funding of $1 million, with an additional funding of $250,000. Under the terms of the 18 month note, the Company is obligated to repay a total of $275,000 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the 2025 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets.
On February 20, 2026, Mitesco, Inc. (the “Company”) entered into a third Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “2026 Bridge Note”) with C/M Capital Master Fund, L.P. and WVP Emerging Manager Onshore Fund, LLC, with a potential total funding of $1 million, with an additional funding of $125,000. Under the terms of the 18 month note, the Company is obligated to repay a total of $137,500 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the 2026 Bridge Note is guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets. See Subsequent Events.
Smaller Reporting Company
We are subject to the reporting requirements of Section 13 of the Exchange Act, and subject to the disclosure requirements of Regulation S-K of the SEC, as a “smaller reporting company.” That designation will relieve us of some of the informational requirements of Regulation S-K.
Sarbanes-Oxley Act
Except for the limitations excluded by the JOBS Act discussed under the preceding heading “Smaller Reporting Company,” we are also subject to the Sarbanes-Oxley Act of 2002. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures, and internal control, over financial reporting. The Sarbanes-Oxley Act created a strong and independent accounting oversight board to oversee the conduct of auditors of public companies and strengthen auditor independence. It also requires steps to enhance the direct responsibility of senior members of management for financial reporting and for the quality of financial disclosures made by public companies; establishes clear statutory rules to limit, and to expose to public view, possible conflicts of interest affecting securities analysts; creates guidelines for audit committee members’ appointment, compensation and oversight of the work of public companies’ auditors; management assessment of our internal controls; prohibits certain insiders from trading during pension fund blackout periods; requires companies and auditors to evaluate internal controls and procedures; and establishes a federal crime of securities fraud, among other provisions. In addition, we will be required to comply with the requirements of the
Section 404 of the Sarbanes-Oxley Act when we cease to be an emerging growth company. We expect to incur significant expenses and devote substantial management effort toward ensuring compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act.
Exchange Act Reporting Requirements
Section 14(a) of the Exchange Act requires all companies with securities registered pursuant to Section 12(g) of the Exchange Act, like we are, to comply with the rules and regulations of the SEC regarding proxy solicitations, as outlined in Regulation 14A. Matters submitted to shareholders at a special or annual meeting thereof or pursuant to a written consent will require us to provide our shareholders with the information outlined in Schedules 14A (where proxies are solicited) or 14C (where consents in writing to the action have already been received or anticipated to be received) of Regulation 14, as applicable; and preliminary copies of this information must be submitted to the SEC at least 10 days prior to the date that definitive copies of this information are forwarded to our shareholders.
We are also required to file annual reports on Form 10-K and quarterly reports on Form 10-Q with the SEC on a regular basis, and will be required to timely disclose certain material events (e.g., changes in corporate control; acquisitions or dispositions of a significant amount of assets other than in the ordinary course of business; and bankruptcy) in a Current Report on Form 8-K.
Other Corporate Information
Our website is www.mitescoinc.com and our principal executive offices is located at 505 Beachland Blvd, Vero Beach, Florida 32963. Our telephone number is (844) 383 8689. We make available free of charge on our website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports, as soon as reasonably practicable after we electronically file or furnish such materials to the SEC. Our website (www.mitescoinc.com) and the information contained therein or connected thereto are not intended to be incorporated into this Form 10-K. Our filings are also available through the SEC website www.sec.gov.
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ITEM 1A. RISK FACTORS
RISK FACTORS
Investing in our securities involves a high degree of risk. You should carefully consider the risks described below, as well as the other information in this prospectus, including our financial statements and the related notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this prospectus, before deciding whether to invest in our securities. The occurrence of any of the events or developments described below could harm our business, financial condition, results of operations and growth prospects. In such an event, the market price of our securities could decline, and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations. Some statements in this prospectus, including such statements in the following risk factors, constitute forward-looking statements. See the section entitled “Cautionary Note Regarding Forward-Looking Statements.”
Risks Related to our Business
We are in the initial stages of our present business plan and have a limited historical performance for you to base an investment decision upon, and we may never become profitable.
We have a new business plan and no operating history upon which an evaluation of our prospects and future performance can be made. Our planned operations are subject to all business risks associated with new companies. The likelihood of our success must be assessed considering the problems, expenses, difficulties, complications, and delays frequently encountered in connection with the establishment of a new business, operation in a competitive industry. There is a possibility that we could sustain losses for a long time or may never operate profitably. If we are not successful in implementing our strategy as anticipated, continue to incur losses, and fail to raise additional capital, we may need to consider alternative options and in an extreme scenario, shut down operations.
The success of our business is dependent on subscription and renewal of our services by customers.
Our growth will be dependent upon successful onboarding of customers who subscribe to our data storage, data hosting, datacenter, and managed service offerings. This success is dependent on successful marketing strategy, network building and expansion, and advertising, all of which will incur capital expenditure. Moreover, if and when we onboard customers, customers have no obligation to renew their subscriptions for our services after the expiration of their contractual subscription period, and in the normal course of business, some customers will elect not to renew. In addition, our customers may renew for fewer subscriptions, renew for shorter contract lengths or switch to lower cost offerings of our services, particularly in times of general economic uncertainty.
Our future success also depends in part on our ability to sell additional features and services, more subscriptions or enhanced editions of our services to our current customers. This may also require increasingly sophisticated and costly sales efforts that are targeted at senior management. Similarly, the rate at which our customers purchase new or enhanced services depends on a number of factors, including general economic conditions and customer receptiveness to any price changes related to these additional features and services.
We may become involved in legal proceedings that could have a material adverse impact on our business, results of operations and financial condition.
From time to time and in the ordinary course of our business, we and certain of our subsidiaries may become involved in various legal proceedings and claims, including for example, employment disputes and litigation; client disputes and litigation alleging solution and implementation defects, intellectual property infringement, violations of law and breaches of contract and warranties; and other third party disputes and litigation alleging intellectual property infringement, violations of law, and breaches of contracts and warranties.
Virtually all of our current outstanding obligations of approximately $3.4 million arise from settlement agreements with the property owners of the locations utilized for our clinic business, which was shuttered in Q4 of FY2022, or default judgments issued by state courts against the Company. While we believe that we have settled pending litigation, there can be continued, or renewed, claims from existing creditors, judgement holders or other holders of its historical obligations. Management continues to resolve its historical obligations through negotiation and use of its securities, though not all holders of its historical obligations appreciate the opportunity to own equity in the Company. Nonetheless, the Company may not be able to fund the payment of its historical obligations in the form of cash until it becomes cash-flow positive.
Legal proceedings are inherently unpredictable and, regardless of the merits of the claims, litigation may be expensive, time-consuming, and disruptive to our operations and distracting to management. If resolved against us, such legal proceedings could result in excessive verdicts, injunctive relief or other equitable relief that may affect how we operate our business. Similarly, if we settle such legal proceedings, it may affect how we operate our business. Future court decisions, alternative dispute resolution awards, business expansion or legislative activity may increase our exposure to litigation and regulatory investigations. In some cases, substantial non-economic remedies or punitive damages may be sought. Adverse outcomes may result in significant monetary damages or injunctive relief that could adversely affect our ability to conduct our business.
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We are in an intensely competitive industry and there is no assurance we will be able to compete with our competitors who have greater resources than us.
Because we are a new business, our competitors may have greater name recognition, longer operating history and significantly greater resources than we do. Further, the data services industry is a highly competitive and established market with an abundance of domestic and international firms offering services similar to ours. In addition, current and potential competitors have established, and may in the future establish, cooperative relationships with vendors of complementary services, technologies, or services to increase the availability of their solutions in the marketplace. Accordingly, new competitors or alliances may emerge that have greater market share, a larger customer base, more widely adopted proprietary technologies, greater marketing expertise, greater financial resources, and larger sales forces than we have, which could put us at a competitive disadvantage. Further, our current or potential competitors may be acquired by third parties with greater available resources. As a result, our competitors may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards or customer and patient requirements and may have the ability to initiate or withstand substantial price competition.
Rapid technological change in our industry presents us with significant risks and challenges.
Our success will depend on our ability to enhance our solution with next-generation technologies and to develop or to acquire and market new services to access new consumer populations. There is no guarantee that we will possess the resources, either financial or personnel, for the research, design and development of new applications or services, or that we will be able to utilize these resources successfully and avoid technological or market obsolescence. Further, there can be no assurance that technological advances by one or more of our competitors or future competitors will not result in our present or future software-based products and services becoming uncompetitive or obsolete.
If we do not manage our strategy effectively, our revenue, business and operating results may be harmed.
We have not yet generated significant revenues from our present operations and may not do so for an indefinite period of time. Our future revenues and profitability depend upon our ability to successfully implement a growth strategy. There can be no assurance given that we will be successful in executing our growth strategy, and even if we achieve our strategic plan, that we will realize, in full or in part, the anticipated benefits we expect our strategy will achieve. The failure to realize those benefits could have a material adverse effect on our business, financial condition, and results of operations. Acquisitions may require greater than anticipated investment of operational and financial resources. Acquisitions and related growth may also require the integration of different services, assimilation of new employees, diversion of management and IT resources, increases in administrative costs and other additional costs associated with any debt or equity financings undertaken in connection with such acquisitions. We may not be able to effectively manage this expansion in any one or more of these areas, and any failure to do so could significantly harm our business, financial condition, and results of operations. We cannot assure you that any acquisition we undertake will be successful. Future growth will also place additional demands on our resources and may require us to hire and train additional employees. We will need to expand and acquire systems and infrastructure to accommodate our planned operations. The failure to implement our plan of operations and manage any future growth effectively will materially and adversely affect our business.
Risks Related to our Financial Condition
There is substantial doubt about our ability to continue as a going concern because of our limited operating history, history of losses and financial resources, and if we are unable to generate significant revenue or secure financing, we may be required to cease or curtail our operations.
We have a history of losses. We have nominal revenues from our operations. The Report of our Independent Registered Public Accounting Firm issued in connection with our audited financial statements for the calendar years ended December 31, 2025, and 2024, expressed substantial doubt about our ability to continue as a going concern, since we have had recurring operating losses and our lack of liquidity and working capital. The Company’s continuance is dependent on raising capital and generating revenues sufficient to sustain operations. We have generated only minimal revenues from our present business plan. If we generate revenue more slowly than we anticipate, or if our operating expenses are higher than we expect, we may not be able to pay our operating expenses or achieve profitability, and our financial condition could suffer. Whether we can achieve cash flow levels sufficient to support our operations cannot be accurately predicted. Unless such cash flow levels are achieved, we will need to borrow additional funds or sell debt or equity securities, or some combination thereof, to obtain funding for our operations. Such additional funding may not be available on commercially reasonable terms, or at all.
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We will need additional capital to implement and fund our operations.
The extent of our capital needs will depend on numerous factors, including (i) the availability and terms of any financing available to us;(ii) the success of our newly established business plan; (iii) the level of our investment in research and development; (iv) the amount of our capital expenditures, including acquisitions; and (v) regulations applicable to our operations. We cannot assure you that we will be able to obtain capital in the future to meet our needs. Even if we do find a source of additional capital, we may not be able to negotiate terms and conditions for receiving the additional capital that are acceptable to us. Any future capital investments could dilute or otherwise materially and adversely affect the holdings or rights of our existing stockholders. In addition, new equity or convertible debt securities issued by us to obtain financing could have rights, preferences, and privileges senior to our Common Stock. We cannot give you any assurance that any additional financing will be available to us, or if available, will be on terms favorable to us.
We may incur additional debt in the future which may contain restrictive covenants and impair our operating flexibility.
Because we currently have no significant revenue and limited cash on hand, we must seek funds for our operational plans. If we incur additional indebtedness in the future, a portion of the cash flow we generate, if any, will be dedicated to the payment of principal and interest on outstanding indebtedness. Typical loan agreements also might contain restrictive covenants, which may impair our operating flexibility. Such loan agreements would also provide for default under certain circumstances, such as failure to meet certain financial covenants. A default under a loan agreement could result in the loan becoming immediately due and payable and, if unpaid, a judgment in favor of such lender which would be senior to the rights of our stockholders. A judgment creditor would have the right to foreclose on our limited assets resulting in a material adverse effect on our business, operating results, and financial condition.
We have identified weaknesses in our internal controls, and we cannot provide assurances that these weaknesses will be effectively remediated, or that additional material weaknesses will not occur in the future.
As a public company, we are subject to the reporting requirements of the Exchange Act, and the Sarbanes-Oxley Act. We expect that the requirements of these rules and regulations will continue to increase our legal, accounting, and financial compliance costs, make some activities more difficult, time consuming and costly, and place significant strain on our personnel, systems, and resources.
The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures, and internal control over financial reporting.
We do not yet have effective disclosure controls and procedures, or internal controls over all aspects of our financial reporting. We are continuing to develop and refine our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms. Our management is responsible for establishing and maintaining adequate internal control over our financial reporting, as defined in Rule 13a-15(f) under the Exchange Act.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.
We have identified material weaknesses in our internal control over financial reporting. A material weakness is 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 financial statements will not be prevented or detected on a timely basis. The material weaknesses identified to date include (i) lack of segregation of duties and (ii) lack of sufficient resources to ensure that information required to be disclosed by us in the reports that we file or submit to the SEC are recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms. As such, our internal controls over financial reporting were not designed or operating effectively.
We will be required to expend time and resources to further improve our internal controls over financial reporting, including by expanding our staff. However, we cannot assure you that our internal control over financial reporting, as modified, will enable us to identify or avoid material weaknesses in the future.
We have not yet retained sufficient staff or engaged sufficient outside consultants with appropriate experience in GAAP presentation to devise and implement effective disclosure controls and procedures, or internal controls. We will be required to expend time and resources hiring and engaging additional staff and outside consultants with the appropriate experience to remedy these weaknesses. We cannot assure you that management will be successful in locating and retaining appropriate candidates; that newly engaged staff or outside consultants will be successful in remedying material weaknesses thus far identified or identifying material weaknesses in the future; or that appropriate candidates will be located and retained prior to these deficiencies resulting in material and adverse effects on our business. Our ability to retain staff with appropriate experience in GAAP presentation will also be dependent upon the revenue we generate from operations and our ability to raise sufficient funding. We believe that the material weaknesses as reported will eventually be fully remediated, upon being properly capitalized to hire the proper personnel for segregation of duties and SEC and GAAP accounting knowledge.
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Our current controls and any new controls that we develop may become inadequate because of changes in conditions in our business. Further, weaknesses in our disclosure controls or our internal controls over financial reporting may be discovered in the future. Any failure to develop or maintain effective controls, or any difficulties encountered in their implementation or improvement, could harm our operating results, or cause us to fail to meet our reporting obligations and may result in a restatement of our financial statements for prior periods. Any failure to implement and maintain effective internal controls over financial reporting could also adversely affect the results of management reports and independent registered public accounting firm audits of our internal controls over financial reporting that we will eventually be required to include in our periodic reports that will be filed with the SEC. Ineffective disclosure controls and procedures, and ineffective internal controls over financial reporting could cause investors to lose confidence in our reported financial and other information, which would likely have a negative effect on the market price of our Common Stock.
Our independent registered public accounting firm is not required to audit the effectiveness of our internal control over financial reporting until after we are no longer a “smaller reporting company” as defined in the Jumpstart Our Business Startups (JOBS) Act of 2012. At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed, or operating. Any failure to maintain effective disclosure controls and internal control over financial reporting could have a material and adverse effect on our business and operating results and cause a decline in the market price of our Common Stock.
Our operating results and liquidity needs could be negatively affected by market fluctuations and the economic downturn.
Our operating results and liquidity could be negatively affected by economic conditions generally, both in the United States and elsewhere around the world. Domestic and international equity and debt markets have experienced and may continue to experience heightened volatility and turmoil based on domestic and international economic conditions and concerns. In the event these economic conditions and concerns continue or worsen, and the markets continue to remain volatile, our operating results and liquidity could be adversely affected by those factors in many ways, including weakening demand for certain of our services and making it more difficult for us to raise funds if necessary, and our stock price may decline.
In addition, the global macroeconomic environment could be negatively affected by, among other things, a resurgence of COVID-19 or other pandemics or epidemics, instability in global economic markets, increased U.S. trade tariffs and trade disputes with other countries, instability in the global credit markets, supply chain weaknesses, instability in the geopolitical environment as a result of the withdrawal of the United Kingdom from the European Union, the Russian invasion of Ukraine, the war in the Middle East and other political tensions, and foreign governmental debt concerns. Such challenges have caused, and may continue to cause, uncertainty and instability in local economies and in global financial markets. We are actively monitoring the effects these disruptions and increasing inflation could have on our operations. These conditions make it extremely difficult for us to accurately forecast and plan future business activities.
Settlements with various leaseholders and vendors have created obligations that may hinder our ability to finance future operations
As a result of obligations to leaseholders and construction-related vendors we now have settlement agreements and consent judgements in the total amount of approximately $3.4 million. These obligations bear interest at various rates according to the local law in addition to the face amounts owed. The existence of these obligations may inhibit our ability to attain further financing.
Risks Related to Government Regulation
Privacy concerns and laws as well as evolving regulation of cloud computing, AI services, cross-border data transfer restrictions and other domestic regulations may limit the use and adoption of our services and adversely affect our business.
Regulation related to the provision of services over the Internet is evolving, as federal and state governments continue to adopt new, or modify existing, laws and regulations addressing data privacy, cybersecurity, data protection, data collection, processing, storage, hosting, transfer and use of data, generally. Data privacy laws, such as the California Consumer Privacy Act (“CCPA”) as amended by the California Privacy Rights Act (“CPRA”), and laws that have recently passed and/or gone into effect in many other states similarly impose new obligations on us and many of our customers, potentially as both businesses and service providers. These laws continue to evolve, and as various jurisdictions introduce similar proposals, we and our customers could be exposed to additional regulatory burdens.
In addition, various safe harbors have historically been provided to those who hosted content provided by others, such as safe harbors from monetary damages for copyright infringement arising from copyrighted content provided by customers and others and for defamation and other torts arising from information provided by customers and others. There is an increasing demand for repealing or limiting these safe harbors by either judicial decision or legislation, and we have active legal proceedings that have been impacted by the repeal or limiting of safe harbors that were previously available to us. Loss of these safe harbors may require altering or limiting some of our services or may require additional contractual terms to avoid liabilities for our customers’ misconduct.
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These laws may require us to make additional changes to our practices and services to enable us or our customers to meet the new legal requirements and may also increase our potential liability exposure through new or higher potential penalties for noncompliance, including as a result of penalties, fines and lawsuits related to data breaches. Furthermore, privacy laws and regulations are subject to differing interpretations and may be inconsistent among jurisdictions. These and other requirements are causing increased scrutiny among customers and may be perceived differently from customer to customer. These developments could reduce demand for our services, require us to take on more onerous obligations in our contracts, restrict our ability to store, transfer and process data or, in some cases, impact our ability or our customers’ ability to offer our services in certain locations, to deploy our solutions, to reach current and prospective customers, or to derive insights from customer data globally.
The costs of compliance with, and other burdens imposed by, privacy laws, regulations and standards may limit the use and adoption of our services, reduce overall demand for our services, make it more difficult to meet expectations from our commitments to customers and our customers’ customers, lead to significant fines, penalties or liabilities for noncompliance, impact our reputation, or slow the pace at which we close sales transactions, in particular where customers request specific warranties and unlimited indemnity for noncompliance with privacy laws, any of which could harm our business.
Furthermore, the uncertain and shifting regulatory environment and trust climate may raise concerns regarding data privacy and cybersecurity, which may cause our customers or our customers’ customers to resist providing the data necessary to allow our customers to use our services effectively. In addition, new products we develop or acquire in connection with changing events may expose us to liability or regulatory risk. Even the perception that the privacy and security of personal information is not satisfactorily protected or does not meet regulatory requirements could inhibit sales of our products or services and could limit adoption of our cloud-based solutions.
Industry-specific regulations and other requirements and standards are evolving, and unfavorable industry-specific laws, regulations, interpretive positions or standards could harm our business.
Our customers and potential customers could conduct business in a variety of industries, including financial services, the public sector, healthcare and telecommunications. Regulators in certain industries have adopted and may in the future adopt regulations or interpretive positions regarding the use of cloud computing, AI services and other outsourced services. The costs of compliance with, and other burdens imposed by, industry-specific laws, regulations and interpretive positions may limit our customers’ use and adoption of our services and reduce overall demand for our services. Compliance with these regulations may also require us to devote greater resources to support certain customers, which may increase costs and lengthen sales cycles. In the United States, a cybersecurity Executive Order released in May 2021 may heighten future compliance and incident reporting standards in order to obtain certain public sector contracts. If we are unable to comply with these guidelines or controls, or if our customers are unable to obtain regulatory approval to use our services where required, our business may be harmed
Further, in some cases, industry-specific, regionally specific or product-specific laws, regulations or interpretive positions may impact our ability, as well as the ability of our customers, partners and data providers, to collect, augment, analyze, use, transfer and share personal and other information that is integral to certain services we provide. The interpretation of many of these statutes, regulations and rulings is evolving in the courts and administrative agencies and an inability to comply may have an adverse impact on our business and results. This impact may be particularly acute in countries that have passed or are considering passing legislation that requires data to remain localized “in country,” as this may impose financial costs on companies required to store data in jurisdictions not of their choosing and to use nonstandard operational processes that add complexity and are difficult and costly to integrate with global processes.
Further, countries are applying their data and consumer protection laws to AI, and particularly generative AI, and/or are considering legal frameworks on AI. Any failure or perceived failure by us to comply with such requirements could have an adverse impact on our business.
If the statutes and regulations in our industry change, our business could be adversely affected.
If there are changes in laws, regulations, or administrative or judicial interpretations, we may have to change our future business practices, or our business practices could be challenged as unlawful, which could have a material adverse effect on our business, financial condition, and results of operations.
Risks Related to Acquisitions
Acquisitions may subject us to liability with regard to the creditors, customers, and shareholders of the sellers.
While we intend that any acquisitions that we consummate will typically be structured as asset purchase agreements in which we attempt to limit our risk and exposure relative to the respective sellers’ liabilities, we cannot guarantee that we will be successful in avoiding all liability. Creditors may seek to hold us accountable for seller debt and customers and for seller breaches of contract prior to our transactions. Occasionally, disaffected shareholders may attempt to interfere with our business acquisitions. We will attempt to minimize all of these risks through thorough due diligence, negotiating indemnities and holdbacks, obtaining relevant representations from sellers, and leveraging experienced professionals when appropriate; however, there can be no assurance that we will be able to mitigate all risks.
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We may be unable to implement our strategy of acquiring companies.
Although we expect that one or more acquisition opportunities will become available in the future, we may not be able to acquire companies at all or on terms favorable to us. We will likely need additional financing for such acquisitions, but there is no assurance that we will be able to borrow funds or raise capital through the issuance of our equity on favorable terms. Certain of our larger, better capitalized competitors may seek to acquire some of the companies we may be interested in. Competition for acquisitions would likely increase acquisition prices and result in us having fewer acquisition opportunities. Depending on the type of businesses we acquire, we may have varying cost saving and/or cross-selling opportunities with the acquired business. However, there is no assurance that we will achieve anticipated cost savings and cross-selling on our acquisitions, and failure to do so may mean we overpaid for such acquisitions. In completing any acquisitions, we will rely upon the representations and warranties and indemnities made by the sellers with respect to each acquisition as well as our own due diligence investigation. We cannot be assured that such representations and warranties will be true and correct or that our due diligence will uncover all materially adverse facts relating to the operations and financial condition of the acquired companies or their customers. To the extent that we are required to pay for obligations of an acquired company, or if material misrepresentations exist, we may not realize the expected benefit from such acquisition, and we will have overpaid in cash, stock, assumed debt, seller notes, and/or earnouts for the value received in that acquisition.
Future acquisitions may result in potentially dilutive issuances of equity securities, the incurrence of indebtedness and increased amortization expense.
Future acquisitions may result in dilutive issuances of equity securities, the incurrence of debt, the assumption of known and unknown liabilities, the write-off of software development costs and the amortization of expenses related to intangible assets, all of which could have an adverse effect on our business, financial condition, and results of operations.
We face risks arising from acquisitions that we pursue in the future.
We may pursue strategic acquisitions in the future. Risks in acquisition transactions include difficulties in the integration of acquired businesses into our operations and control environment, difficulties in assimilating and retaining employees and intermediaries, difficulties in retaining the existing clients of the acquired entities, assumed or unforeseen liabilities that arise in connection with the acquired businesses, the failure of counter parties to satisfy any obligations to indemnify us against liabilities arising from the acquired businesses, and unfavorable market conditions that could negatively impact our growth expectations for the acquired businesses. Fully integrating an acquired company or business into our operations may take a significant amount of time. We cannot assure you that we will be successful in overcoming these risks or any other problems encountered with acquisitions and other strategic transactions. These risks may prevent us from realizing the expected benefits from acquisitions and could result in the failure to realize the full economic value of a strategic transaction or the impairment of goodwill and/or intangible assets recognized at the time of an acquisition. These risks could be heightened if we complete a large acquisition or multiple acquisitions within a short period of time.
Risks Related to Our Management
Our success will be dependent on our management, and the continued service of key employees.
Our success is dependent upon the decision making of our directors and executive officers. We believe that our success depends on the continued service of these persons and our ability to hire additional employees as and when needed. Currently, we have no full-time employees, rather our needs are being met from the efforts of our directors and a number of individuals under consulting or advisory agreements including accounting, SEC reporting, legal, sales, systems operation and software development. Further, we cannot assure that we will be able to find and recruit new employees on terms acceptable to the Company. The unexpected loss of the services of one or more of our executives, directors and advisors, or the inability to find new employees within a reasonable period of time, when needed, could have a material adverse effect on the economic condition and results of operations of the Company.
Our executive officers, directors and certain key stockholders own and control a significant number of voting securities and so long as they do, they are able to control the outcome of stockholder voting.
Our executive officer, directors as well as certain other key shareholders are the owners in excess of approximately 53% of the voting shares of the Company as of December 31, 2025, as a result of their ownership of our Series X Cumulative Redeemable Perpetual Preferred Stock (the “Series X Preferred Stock”), and Common Stock. The Series X Preferred stock votes with our outstanding shares of Common Stock at the rate of 400 votes for each share owned, one (1) vote for each common holder. As such, our board can determine the outcome of all matters submitted to our stockholders for approval, including the election of directors. Our management’s control of our voting securities may make it impossible to complete some corporate transactions without its support and may prevent a change in our control. In addition, this ownership could discourage the acquisition of our Common Stock by potential investors and could have an anti-takeover effect, possibly depressing the trading price of our Common Stock.
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Risks Relating to Ownership of our Stock
Shares eligible for future sale may have an adverse effect on our share price.
Sales of substantial amounts of shares or the perception that such sales could occur may adversely affect the prevailing market price for our shares. We may issue additional shares in subsequent public offerings or private placements to make new investments or for other purposes. We are not required to offer any such shares to existing shareholders on a pre-emptive basis. Therefore, it may not be possible for existing shareholders to participate in such future share issuances, which may dilute the existing shareholders’ interests in us.
Our Common Stock is considered a “penny stock,” and is subject to SEC rules that impose additional sales practice requirements on broker-dealers. These requirements may reduce the liquidity of our Common Stock and make it more difficult for investors to sell their shares.
Our Common Stock trades on the OTC marketplace at a price below $5.00 per share and therefore constitutes a “penny stock” under Rule 3a51-1 of the Exchange Act. As a result, sales of our Common Stock by a broker-dealer are subject to the penny stock rules under Rules 15g-1 through 15g-9, which require broker-dealers to provide potential investors with a standardized risk disclosure document, make a special suitability determination, and obtain the purchaser’s written consent before completing a transaction. These rules may limit the ability of broker-dealers to sell our Common Stock, reduce the level of trading activity in our securities, impair the liquidity of our Common Stock, and make it more difficult for investors to resell shares or obtain accurate price quotations. Because of these and other regulatory requirements, you may find it difficult to sell your shares of our Common Stock. Even if an investor is able to find a buyer, they may receive a lower price for their shares.
We do not anticipate paying any cash dividends on our Common Stock in the foreseeable future.
We currently intend to retain all our future earnings to finance the growth and development of our business, and therefore, we do not anticipate paying any cash dividends on our Common Stock in the foreseeable future. We believe it is likely that our Board will continue to conclude that it is in our best interests to retain all earnings (if any) for the development of our business. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, of our Common Stock will be your sole source of gain for the foreseeable future.
If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
The trading market for our Common Stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. Securities and industry analysts do not currently, and may never, publish research on our company. If no securities or industry analysts commence coverage of our company, the trading price for our stock would likely be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock price may decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.
Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future, and as a result, investors in our Common Stock could incur substantial losses.
Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future. On October 2, 2025, the reported closing price of our Common Stock was $0.38, while on March 30, 2026, the reported closing sales price was $0.08. We may incur rapid and substantial decreases in our stock price in the foreseeable future that are unrelated to our operating performance or prospects. In addition, sales of substantial amounts of our Common Stock, or the perception that such sales might occur, could adversely affect the prevailing market prices of our Common Stock and Warrants and our stock price may decline substantially in a short period of time. As a result, our stockholders could suffer losses or be unable to liquidate holdings. As a result of this volatility, investors may experience losses on their investment in our Common Stock. The market price for our Common Stock may be influenced by many factors, including the ones discussed in this section titled “Risk Factors”.
Our Common Stock has often been thinly traded, so investors may be unable to sell at or near ask prices or at all if investors need to sell shares to raise money or otherwise desire to liquidate their shares.
To date, there have been many days on which limited trading of our Common Stock took place. We cannot predict the extent to which investors’ interests will lead to an active trading market for our Common Stock or whether the market price of our Common Stock will be volatile. If an active trading market does not develop, investors may have difficulty selling our Common Stock. We are likely to be too small to attract the interest of many brokerage firms and analysts. We cannot give investors any assurance that an active public trading market for our Common Stock will develop or be sustained. The market price of our Common Stock could be subject to wide fluctuations in response to quarterly variations in our revenues and operating expenses, announcements of new products or services by us, significant sales of our Common Stock, including “short” sales, the operating and stock price performance of other companies that investors may deem comparable to us, and news reports relating to trends in our markets or general economic conditions.
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Because we may issue preferred stock without the approval of our shareholders and have other anti-takeover defenses, it may be more difficult for a third party to acquire us and could depress our stock price.
In general, our Board may issue, without a vote of our shareholders, one or more additional series of preferred stock that may have such voting powers, full, enhanced or limited, or no voting powers, and such preferences and relative, participating, optional, or other special rights and such qualifications, limitations, or restrictions thereof as adopted by the Board, which may include enhanced dividend rights, rights of redemption, sinking funds to pay dividends, liquidation, and other rights that would be different than, and preferential to, the rights of the Common Stockholders, although our ability to designate and issue preferred stock is currently restricted by covenants in the Certificate of Designation for the Series A Amortizing Convertible Preferred Stock. Without these restrictions, our Board could issue preferred stock to investors who support us and our management and give effective control of our business to our management. Additionally, issuance of preferred stock could block an acquisition resulting in both a drop in our stock price and a decline in interest of our Common Stock. This could make it more difficult for shareholders to sell their Common Stock. This could also cause the market price of our Common Stock to drop significantly, even if our business is performing well.
Risks Related to Debt Restructuring
Redemption of all shares of Series A Preferred Stock into Common Stock may lead to severe dilution of our existing shares.
The Series A Preferred Shares are subject to redemption by the Company, either in the form of cash or Common Stock, beginning January 1, 2025, at a rate of 1/36 of the total outstanding Series A Preferred Shares, over the following three years. The Common Stock redemption shall be at a 10% discount to the average of the five lowest closing prices over a 30-trading day period. The last closing price of our Common Stock on December 31, 2025, in the OTC Market was $0.17. The total value of the outstanding Series A Preferred Stock is $13,333,500 as of December 31, 2025, based on a face value of $25 per share. If the Company redeems all of the shares of Series A Preferred Stock at a rate of $0.15 per share prior to their mandatory conversion into Common Stock (which occurs at a rate of $4.00 per share), the Company will have issued an aggregate of 88,890,000 shares of Common Stock at the end of the three-year period, which could cause a dilution of over 90% to our existing shareholders.
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Risks Related to Cybersecurity
If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, or are perceived to have been compromised, we could experience adverse consequences, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; loss of customers or sales; and other adverse consequences.
In the ordinary course of our business, we and the third parties upon which we rely, may collect, receive, store, use, transmit, disclose, transfer, disclose, make accessible, protect, secure, dispose of, transmit, share, or otherwise process proprietary, confidential, and sensitive data, including personal data (such as health-related data regarding clinical trial subjects), intellectual property, and trade secrets.
Cyberattacks, malicious internet-based activity, and online and offline fraud and other similar activities threaten the confidentiality, integrity, and availability of our sensitive information and information technology systems, and those of the third parties upon which we rely. Such threats are prevalent and continue to rise, are increasingly difficult to detect, and come from a variety of sources, including traditional computer “hackers,” threat actors, “hacktivists,” organized criminal threat actors, personnel (such as through theft or misuse), sophisticated nation-states, and nation-state-supported actors. Some actors now engage and are expected to continue to engage in cyber-attacks, including without limitation nation-state actors for geopolitical reasons and in conjunction with military conflicts and defense activities. During times of war and other major conflicts, we, the third parties upon which we rely, may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our goods and services. We and the third parties upon which we rely may be subject to a variety of threats, including, but not limited to, malicious code (such as viruses and worms), social engineering attacks (including through phishing attacks), malware (including as a result of advanced persistent threat intrusions), denial of service attacks (such as credential stuffing), credential harvesting, software bugs, server malfunctions, software or hardware failures, unauthorized access, natural disasters, fire, terrorism, successful breaches, personnel misconduct or error, or human or technological error, war and telecommunication and electrical failures.
In particular, severe ransomware attacks are becoming increasingly prevalent and severe, and can lead to significant interruptions in our operations, loss of sensitive data, reputational harm, and diversion of funds. Extortion payments may alleviate some of the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments. Additionally, the COVID-19 pandemic poses increased risks to our information technology systems and data, as more of our employees work from home, utilizing network connections outside our premises. Future or past business transactions (such as acquisitions or integrations) could expose us to additional cybersecurity risks and vulnerabilities, as our systems could be negatively affected by vulnerabilities present in acquired or integrated entities’ systems and technologies. Furthermore, we may discover security issues that were not found due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program.
We may rely on third parties (such as service providers and technologies) to process sensitive information in a variety of contexts, including without limitation third-party providers of cloud-based infrastructure, encryption and authentication technology, employee email, and other functions. Our ability to monitor these third parties’ cybersecurity practices is limited, and these third parties may not have adequate information security measures in place. If our third-party service providers experience a security incident or other interruption, we could experience adverse consequences. While we may be entitled to damages if our third-party service providers fail to satisfy their privacy or security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award. In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties’ infrastructure in our supply chain or our third-party partners’ supply chains have not been compromised. Any of the previously identified or similar threats could cause a security incident or other incident during which our information technology systems or data could be compromised, which could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration, encryption, disclosure of, or access to our data; it could also disrupt our ability (and that of third parties upon which we rely) to operate our business.
We may expend significant resources or modify our business activities in an effort to protect against the compromise of our information technology systems and data. Further, certain data privacy and security obligations may require us to implement and maintain specific security measures, industry standard or reasonable security measures to protect our information technology systems and data.
If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences, including: government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing data (including personal data); litigation (including class actions); indemnification obligations; negative publicity; reputational harm; monetary fund diversions; interruptions in our operations (including availability of data); financial loss; and other similar harms. Additionally, applicable data privacy and security obligations may require us to notify relevant stakeholders; such disclosures are costly, and the disclosures or the failure to comply with such requirements could lead to adverse consequences.
We face the risk of unauthorized access to or breaches of our information systems.
Cybersecurity threats are constantly evolving, making it challenging to predict, prevent, or mitigate all potential attacks. Advanced persistent threats, ransomware, and other sophisticated attacks could impair our ability to operate efficiently and securely. We face the risk of unauthorized access to or breaches of our information systems that could result in the misappropriation of sensitive information, including customer, employee, or proprietary data. These incidents could occur through malicious software, phishing attacks, or insider threats. While we have implemented comprehensive cybersecurity measures, including firewalls, encryption, and employee training, no system is completely secure. A successful attack could disrupt our operations, cause financial loss, damage our reputation, lead to regulatory penalties, and erode customer trust.
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Operations and Finances may be impacted by a cybersecurity breach of our information system.
A cybersecurity breach could lead to significant financial losses, regulatory penalties, reputational harm, and operational disruptions. A significant cybersecurity event could result in the theft or destruction of our customer’s intellectual property, disruption of their operations, financial loss, severe reputational harm, and litigation expenses, which will adversely affect our financial condition. An attack could result in temporary or long-term shutdowns of critical systems, causing revenue losses and increased operating costs as we attempt to recover and restore normal operations. Cyber incidents may also result in diminished future cash flows, thereby requiring consideration of impairment of certain assets including goodwill, customer-related intangible assets, trademarks, patents, capitalized software or other long-lived assets associated with hardware or software, and inventory.
We face challenges in detection and response of cybersecurity breaches.
Despite our investments in cybersecurity measures, there is no assurance that our systems can effectively detect or respond to all cyber threats, particularly those targeting undisclosed or newly discovered vulnerabilities.
Market and Industry Data
This Annual Report may contain market, industry and government data and forecasts that have been obtained from publicly available information, various industry publications and other published industry sources. We have not independently verified the information and cannot make any representation as to the accuracy or completeness of such information. None of the reports and other materials of third-party sources referred to in this Annual Report were prepared for use in, or in connection with, this Annual Report.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 1C. CYBERSECURITY
Cybersecurity Risk Management and Strategy
The Company does not have its own cybersecurity
policy but relies on the policies and procedures of its Contract Research Organizations (“CROs”) and Software as a Service
(“SaaS”) contractors that handle its data and software.
Cybersecurity Risks and Incidents
The Company faces various cybersecurity risks
and threats that could potentially affect its operations, reputation, financial condition, and competitive position. These risks and threats
include, but are not limited to, unauthorized access, use, disclosure, modification, or destruction of our data, systems, or networks;
denial of service attacks; malware infections; phishing or social engineering attacks; ransomware attacks; loss or theft of devices or
media containing our data; human error or negligence; natural disasters; power outages; or sabotage.
Cybersecurity Policies and Procedures
The Company does not have its own cybersecurity
policy, but it contracts with CROs that handle all of its data and software. Our CRO’s data systems are 21 CFR 11 (Part 11) compliant,
which means that they have implemented controls to ensure the reliability and integrity of electronic records and signatures. Our
All of the software that we use is Commercial Off the Shelf Software (“COTS”) and Microsoft, Dropbox, and Google cloud services. We do not develop, modify, or customize any software for our own use. We rely on the cybersecurity measures and practices of our software and cloud service providers and update our software and systems regularly to address any known vulnerabilities or issues. We also limit the access and use of our software and cloud services to authorized personnel and encourage them to use strong passwords and multifactor authentication. We do not store any sensitive or confidential data on our own devices or media but use password-protected cloud storage.
Cybersecurity Oversight and Governance
The Company’s board of directors is responsible
for overseeing and approving our cybersecurity strategy and policies. Our board of directors receives updates from management on the Company’s
cybersecurity status and initiatives and provides guidance and feedback on the cybersecurity goals and objectives.
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ITEM 2. PROPERTIES
The Company leases office space in Vero Beach, Florida for its headquarters operation at less than $100 per month.
ITEM 3. LEGAL PROCEEDINGS
The Company has a number of legal situations involved with the winding down of its clinic business activities. These include claims regarding certain construction contracts and cancellation of leases as noted below:
| LOCATION | PROPERTY NAME | ORIGINAL OBLIGATION | SETTLEMENT AMOUNT | DATE OF AWARD | INTEREST RATE | INTEREST ACCRUED ON SETTLEMENT | TOTAL SETTLEMENT OBLIGATION | TYPE OF SETTLEMENT | ||||||||||||||||||
| WAYZETTA, MN | WAZETTA BAY | $ | 407,000 | $ | 25,000 | NA | $ | - | $ | 25,000 | CASH PAYMENT OBLIGATION | |||||||||||||||
| EAGAN, MN | VIKINGS | $ | 767,000 | $ | 488,491 | 12/7/2023 | 10 | % | $ | 101,044 | $ | 589,535 | DEFAULT JUDGEMENT | |||||||||||||
| ST. LOUIS PARK, MN | EXCELSIOR | $ | 673,000 | $ | 425,350 | 5/22/2024 | 10 | % | $ | 68,522 | $ | 493,872 | DEFAULT JUDGEMENT | |||||||||||||
| ST. PAUL, MN | CONTINENTAL 560 | $ | 1,153,000 | $ | 415,606 | 1/22/2024 | 10 | % | $ | 80,730 | $ | 496,336 | DEFAULT JUDGEMENT | |||||||||||||
| MAPLE GROVE, MN | BUTTNICK | $ | 1,153,127 | $ | 219,000 | 10/3/2022 | 10 | % | $ | 71,100 | $ | 290,100 | SETTLEMENT AGREEMENT | |||||||||||||
| DENVER, CO | RADIANT | $ | 782,000 | $ | 530,557 | N/A | $ | - | $ | 530,557 | DISMISSED | |||||||||||||||
| DENVER, CO | QUINCY | $ | 1,079,000 | $ | 848,764 | 11/14/2023 | 12 | % | $ | 113,372 | $ | 962,136 | DEFAULT JUDGEMENT | |||||||||||||
| TOTAL | $ | 6,014,127 | $ | 2,952,768 | $ | 434,768 | $ | 3,387,536 | ||||||||||||||||||
Quincy Clinic a.k.a. 1776 Curtis
On September 28, 2021, we entered into an agreement to open a clinic in Denver, Colorado, which was expected to begin operation in the first quarter of 2023 but possession of which has been relinquished to the landlords. The initial lease term is for 94 months. Fixed rent payments under the initial term are approximately $1,079,000. A Final Judgment was granted on November 14, 2023, in the amount of $348,764 including interest, fees and other costs. The Company has released the property back to the leaseholder. The owner of the Quincy Clinic property filed before the same court, an action against the Company seeking to modify the final settlement for an additional $1,250,000, including $350,000 which represent amounts paid to the contractor who was performing the build out, who had filed liens on the property. As of August 8th, 2025, we settled this matter by providing an additional judgment in the amount of $500,000.
Administrative office
On June 24, 2021, we entered into an agreement to open an administrative office in St. Louis Park, Minnesota. The initial lease term is 2.5 years. Fixed rent payments under the initial term were approximately $244,000. We believe that there is no further obligation in this situation, but we do not have such documented in writing at this time.
Gardner Debt for Equity Agreement and other obligations
The Company entered into a debt-for-equity exchange agreement with Gardner Builders Holdings, LLC (the “Creditor”) on January 7, 2022 (the “Agreement”). Pursuant to the Agreement, the Company issued shares of restricted common stock, par value $0.01 per share, of MITI (the “Restricted Shares”) to the Creditor in exchange for the Company Debt Obligations, as defined below.
The Agreement settled certain accounts payable amounts owed by the Company to the Creditor (the “Accounts Payable Amount”) as well as then upcoming amounts that would become due between the date of the Agreement and April 1, 2022. The Agreement also settled incurred interest and penalties on the amounts due through January 5, 2022, as well as future interest payments on amounts to be incurred in the first quarter of 2022 (collectively, the “Additional Costs”, and combined with the Accounts Payable Amount, the “Company Debt Obligations”). The Accounts Payable Amount was $500,000, the Additional Costs were $294,912 and the conversion price was $12.50. As a result, 63,593 Restricted Shares were authorized to be issued. The Company’s Board of Directors approved the Agreement on January 5, 2022. Much of the amounts claimed by Gardner have been resolved by the settlements with the various leaseholders where Gardner had filed liens. During 2021 and through 2022 a total of $2,305,155 was paid by the Company directly to Gardner for their services. As of the date of this filing the Company is continuing an effort to negotiate a settlement of any remaining obligations to this vendor.
ITEM 4. MINE SAFETY DISCLOSURES
Not Applicable.
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PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Trading Market
Our Common Stock is quoted on the OTC Pink Market with the symbol “MITI.”
On April 14, 2026, the price of our Common Stock as reported on the OTC was $0.10 and we have approximately 2,000 holders of record of our Common Stock, and approximately 5,000 shareholders including smaller holders and those with restricted shares not currently in the market.
DESCRIPTION OF OUR CAPITAL STOCK
General
The total number of shares of all classes of shares which we have authority to issue is 600,000,000 of which 500,000,000 shares are designated as “Common Stock” with a par value of $0.01 per share, and 100,000,000 shares are designated as “preferred stock.”
As of December 31, 2025, we had 15,093,055 issued and outstanding shares of Common Stock, 533,340 shares of Series A Preferred Stock issued or outstanding, no shares of Series D Preferred Stock issued and outstanding, no shares of Series F Preferred Stock issued or outstanding, and 42,103 shares of Series X Preferred Stock issued and outstanding.
DIVIDEND POLICY
We have never declared or paid any cash dividends on our Common Stock. Under the Nevada law, we may declare and pay dividends on our capital stock either out of our surplus, as defined in the relevant Nevada statutes, or if there is no such surplus, out of our net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year. If, however, the capital of our company, computed in accordance with the relevant Nevada statutes, has been diminished by depreciation in the value of our property, or by losses, or otherwise, to an amount less than the aggregate amount of the capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets, we are prohibited from declaring and paying out of such net profits and dividends upon any shares of our capital stock until the deficiency in the amount of capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets shall have been repaired. The Company does not intend to declare or pay any cash dividends on its Common Stock in the foreseeable future. The holders of our Common Stock are entitled to receive only such dividends (cash or otherwise) as may be declared by our Board of Directors.
Series A Preferred Stock
During the year ended December 31, 2025, the Company issued 5,000 shares of Series A Preferred Stock in exchange for $125,000 cash, and there were no changes to the authorized shares of this class during the year. During the year ended December 31, 2025, we redeemed 34,658 shares of this class in exchange for 3,794,802 shares of common stock.
During FY2024 we authorized the creation of up to 3,000,000 shares of a new Series A Preferred stock which has no voting rights, and pays no dividends, but ranks superior to all other securities, except for the Series X Preferred stock which is pari parsu with the Series A Preferred stock with regard to any liquidation of assets. As of the date of this filing there are 533,340 shares of Series A Preferred stock issued and outstanding.
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Series X Preferred Stock
The Series X Preferred shares have a liquidation preference of $25.00 per share and will pay a 10% per year dividend based upon the liquidation value. The dividend may be paid in cash or in the issuance of restricted Common Stock. If the Company chooses to pay the dividend in restricted Common Stock the number of shares issued to fulfill the dividend payment shall be determined based on the stock price on the date of the 15th of the month, or the following trading day if it falls on a weekend. The Series X Preferred shares have 400 votes per share and votes with our Common Stock. From July 2023 through September 2024, with consent of the holders, the Company used an $.80 share price in computing the number of shares to be issued to satisfy the dividend requirements, even though the actual market price was substantially lower. Starting in October 2024 the Company returned to a policy of using the actual market price in determining the number of shares to be issued in satisfaction of the dividends.
During the year ended December 31, 2025, the Company issued 2,400 shares of Series X Preferred Stock to the newly elected director of the Company for compensation in lieu of services in the amount of $60,000.
During the year ended December 31, 2025, the Company issued 20,000 shares of Series X Preferred Stock to an institutional investor and consultant for compensation in lieu of services in the amount of $500,000.
As of December 31, 2025, a total of 42,103 shares of Series X Preferred Stock were issued and outstanding.
Series D Preferred Stock
Each share of Series D Preferred Stock accrues dividends on a quarterly basis in arrears, at the rate of 6% per annum of the Stated Value and to be paid within 15 days after the end of each of our fiscal quarters. The Series D Preferred Stock shares rank senior to all other preferred stock of the Company except in relation to the Company’s Series X Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company.
During the financial year ended December 31, 2025, the Company and the holder of the Series D Preferred Stock entered into an Obligation Exchange Agreement whereby the outstanding Series D Preferred Stock and all accrued dividends were exchanged the shares for common shares.
Equity Compensation Plans
For information on the Company’s equity compensation plans, see “Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.”
Recent Sales of Unregistered Shares
Common Stock Issuances in 2025
Restricted Common Stock Issuances
| A) | During FY2025 the Company issued a total of 161,042 shares of restricted common stock for the payment of the Series X Preferred stock dividends. The issuances were as follows: |
| a. | Holder Leath, a member of the Board of Directors, received a total of 16,304 shares for dividend payments; |
| b. | Holder Balencic, a member of the Board of Directors, received a total of 16,304 shares for dividend payments; |
| c. | Holder Mitchell, a former member of the Board of Directors, received a total of 16,304 shares for dividend payments; |
| d. | Holder Clifton, a member of the Board of Directors, received a total of 2,941 shares for dividend payments; |
| e. | Holder Anglo Irish Management LLC received a total of 109,189 shares for dividend payments. |
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| B) | During FY2025 the Company issued the following shares to the Directors in consideration for their contributions outside of their roles as a Director; |
| a. | For efforts through June 30, 2025, Clifton was issued 175,000 shares of restricted stock upon his election to the board; |
| C) | A consultant, A. Colvin, upon her appointment as CTO, received a total of 200,000 shares of restricted stock as consideration for her efforts; |
| D) | As part of its efforts to retain individuals and organization to assist in the Robo Agent software development, the Company issued shares of restricted common stock to the following; |
| a. | S. Downey, 125,000 shares as consideration for their contributions; |
| b. | M. Bowen, 50,000 shares as consideration for their contributions; |
| c. | K. Hughes, 150,000 shares as consideration for their contributions; |
| d. | F. Panunto, 200,000 shares as consideration for their contributions; |
| e. | S. Smith, 100,000 shares as consideration for their contributions. |
| f. | J. Caplan, 100,000 shares as consideration for their contributions. |
| g. | G. Kupsch, 125,000 shares as consideration for their contributions. |
| E) | During FY2025 the Company issued a total of 3,794,755 shares of restricted common stock for the redemptions of the Series A Preferred stock. The issuances were as follows: |
| a. | Holder Jefferson, received a total of 178,409 shares for redemption of 1,544 Series A shares; |
| b. | Holder Cavalry, received a total of 769,919 shares for redemption of 6,642 Series A shares; |
| c. | Holder AJB Capital, received a total of 1,309,280 shares for redemption of 12,131 Series A shares; |
| d. | Holder GS Capital, received a total of 719,800 shares for redemption of 6,463 Series A shares; |
| e. | Holder Mercer, received a total of 531,635 shares for redemption of 5,399 Series A shares. |
| f. | Holder Pinz, received a total of 278,034 shares for redemption of 2,385 Series A shares. |
| g. | Holder C/M Capital, received a total of 7,725 shares for redemption of 94 Series A shares. |
| F) | During FY2025 the following issuances of restricted stock were made to certain holders of obligations of the Company: |
| a. | I. Lindstrom received 75,000 shares in exchange for the cancellation of their accrued obligations, notes payable and related accrued interest, and exchange of their Series D shares and related accrued dividends along with the cancellation of all other obligations and all outstanding warrants; |
| b. | J. Finnegan received 75,000 shares in exchange for the cancellation of their accrued obligations, notes payable and related accrued interest, along with the cancellation of all other obligations and all outstanding warrants; |
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Common Stock Issuances in 2024
Restricted Common Stock Issuances
| A) | During FY2024 the Company issued a total of 99,403 shares of restricted common stock for the payment of the Series X Preferred stock dividends to the nine (9) holders. Amounts noted include shares issued for five (5) holders who subsequently cancelled their Series X Preferred shares. The issuances were as follows: |
| a. | Holder Crone received a total of 5,625 shares. Crone exchanged his Preferred X shares as of September 28, 2024, for common stock using a $4.00 per share valuation; |
| b. | Holder DeLuca received a total of 6,759 shares. DeLuca exchanged his Preferred X shares as of September 28, 2024, for common stock using a $4.00 per share valuation; |
| c. | Holder Diamond, former CEO, received a total of 5,148 shares. Diamond exchanged his Preferred X shares as of September 28, 2024, for common stock using a $4.00 per share valuation; |
| d. | Holder Riewold received a total of 2,813 shares. Riewold exchanged his Preferred X shares as of September 28, 2024, for common stock using a $4.00 per share valuation; |
| e. | Holder Lightmas received a total of 7,594 shares. Lightmas exchanged his Preferred X shares as of September 28, 2024, for common stock using a $4.00 per share valuation; |
| f. | Holder Mitchell, a member of the Board of Directors, received a total of 8,661 shares for dividend payments; |
| g. | Holder Balencic, a member of the Board of Directors, received a total of 8,661 shares for dividend payments; |
| h. | Holder Leath, a member of the Board of Directors, received a total of 8,661 shares for dividend payments; |
| i. | Holder Anglo Irish Management LLC received a total of 45,122 shares for dividend payments. |
| B) | During FY2024 the Company issued the following shares to the Directors in consideration for their contributions outside of their roles as a Director; |
| a. | For efforts through June 30, 2024, each of Leath, Balencic and Mitchell issued 100,000 shares of restricted stock each, a total of 300,000 shares in aggregate; |
| b. | For efforts from July through December 31, 2024, each of Leath, Balencic and Mitchell issued 150,000 shares of restricted stock each, a total of 450,000 shares in aggregate. |
| C) | The members of the Advisory Board each received 75,000 shares of restricted stock for their contribution over a 12-month period, a total of 525,000 shares, as follows: |
| a. | Advisor Wade received 75,000 shares; Advisor Plybon received 75,000 shares; Advisor McLoughlin received 75,000 shares; Advisor Simon received 75,000 shares; Advisor Crawford received 75,000 shares; Advisor Clifton received 75,000 shares; Advisor M. Valania received 75,000 shares; |
| D) | A consultant, B. Valania, who is handling sales and marketing for the Company’s Centcore subsidiary, received a total of 200,000 shares of restricted stock as consideration for his efforts; |
| E) | A. Lance, wife of the CEO Leath, received a total of 100,000 shares of restricted stock as a part of the consideration for her web site business acquired in FY2024; |
| F) | As a part of the FY2024 restructuring the following issuances of restricted stock were made to former executives of the Company, effective September 28, 2024: |
| a. | L. Diamond, former CEO, received 12,500 shares in exchange for the cancellation of his Series X Preferred shares, and 137,375 shares in exchange for cancellation of all other obligations and all outstanding warrants; |
| b. | M. Diamond, daughter of the former CEO, received 20,966 shares in exchange for cancellation of all obligations and any and all outstanding warrants; |
| c. | T. Brodmerkel, a former Director of the Company, received 5,212 shares in exchange for the cancellation of all obligations and any and all outstanding warrants; |
| d. | M. Howe, former CEO of the clinic subsidiary closed in FY2022, received 172,497 shares in exchange for cancellation of all other obligations and any and all outstanding warrants; |
| e. | F. Navqi, a former Director of the Company, received 4,500 in exchange for cancellation of all other obligations and any and all outstanding warrants; |
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| f. | J. Inturregi, a former Director of the Company, received 13,864 shares in exchange for the cancellation of all other obligations and any and all outstanding warrants; |
| g. | A. Dobberlin, husband of a former officer of the Company, received 6,449 shares in exchange for cancellation of all other obligations and any and all outstanding warrants |
| h. | B. Case, a former officer of the clinic subsidiary closed in FY2022, received 30,802 shares in exchange for cancellation of all other obligations and any and all outstanding warrants |
| G) | As a part of the FY2024 restructuring the following issuances of restricted stock were made to current executives of the Company: |
| a. | J. Mitchell, a current Director of the Company, received 27,040 shares in consideration of the cancellation of all obligations to him prior to December 2023, including the cancellation of all warrants; |
| b. | M. Leath, a current Director of the Company, received 17,767 shares in consideration of the cancellation of all obligations to him prior to December 2023, including the cancellation of all warrants |
| H) | As a part of the FY2024 restructuring the following issuances of restricted stock were made to certain holders of obligations of the Company, effective September 28, 2024: |
| a. | R. Riewold received 12,500 shares in exchange for the cancellation of his Series X Preferred shares and cancellation of all other obligations and all outstanding warrants; |
| b. | F. Lightmas received 56,613 shares in exchange for the cancellation of his Series X Preferred shares and cancellation of all other obligations and all outstanding warrants; |
| c. | J. Crone received 18,025 shares in exchange for the cancellation of his Series X Preferred shares and cancellation of all other obligations and all outstanding warrants; |
| d. | Anson Investments received 617,020 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| e. | Anson East received 210,787 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| f. | Dragon Investments received 335,061 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| g. | Mackay Investments received 176,560 shares in exchange for the cancellation of all obligations, including that of its principal, and all outstanding warrants; |
| h. | Darling Investments received 111,075 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| i. | Anglo Irish Management LLC received 58,718 shares in exchange for the cancellation of all obligations and all outstanding warrants of one of its shareholders; |
| j. | The principals of Intereum, a vendor of the clinic operations, received 135,345 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| k. | J. Enright received 68,625 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| l. | C. Hagan received 617,020 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| m. | J. Caplan received 37,238 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| n. | S. Bridges received 36,646 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| o. | E. Nommsen received 22,565 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
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| p. | R. Eisenberg, and his advisors, received 18,000 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| q. | S. Goff received 12,409 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| r. | L. Lewis received 12,409 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| s. | Carter, Terry & Company received 11,573 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| t. | C. Schrier received 8,615 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| u. | J. Ramsdell received 6,500 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| v. | C. Schuler received 5,113 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| w. | Imeson Consulting received 2,500 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
| x. | Exchange Listing, LLC 750 shares in exchange for the cancellation of all obligations and all outstanding warrants; |
ITEM 6. SELECTED FINANCIAL DATA
Implications of Being a Smaller Reporting Company
We are a “smaller reporting company” as defined in the Exchange Act. We may take advantage of certain of the scaled disclosures available to smaller reporting companies so long as the market value of our voting and non-voting Common Stock held by non-affiliates is less than $250.0 million measured on the last business day of our most recently completed second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our Common Stock held by non-affiliates is less than $700.0 million measured on the last business day of our most recently completed second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparisons of our financial statements with other public companies difficult or impossible.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with and is qualified in its entirety by and should be read together with our financial statements and the related notes thereto appearing elsewhere in this filing. This discussion contains certain forward-looking statements that involve risks and uncertainties, as described under the heading “Cautionary Note Regarding Forward-Looking Statements.” Actual results could differ materially from those projected in the forward-looking statements.
Company Overview
Mitesco was formed in the state of Delaware on January 18, 2012. On December 9, 2015, we restructured our operations and acquired Newco4pharmacy, LLC, a development stage company which sought to acquire compounding pharmacy businesses. As a part of the restructuring, we shut down our former business line. On April 24, 2020, we changed our name to Mitesco, Inc. In October 2023, the Company changed its domicile from Delaware to Nevada in order to effect reduced costs.
From 2020 through 2022, our operations were focused on establishing general practice medical clinics utilizing nurse practitioners under The Good Clinic name and development and acquisition of telemedicine technology. We opened our first The Good Clinic in Minneapolis, Minnesota in the first quarter of 2021 and had six operating clinics during the year ended December 31, 2022, with two additional sites under contract. In the fourth quarter of fiscal 2022, we made the strategic decision to close the entire clinic operation and release our staff due to a lack of profitability. The financial results and obligations are now accounted for as “discontinued operations”.
Current Business Operations
We are a holding company seeking to provide products, services and technology.
In June 2024 we announced the formation of two (2) new wholly owned business units, Centcore, LLC (“Centcore”) that is providing data center services including cloud computing and application hosting, and Vero Technology Ventures, LLC (“VTV”), whose aim is to seek investment and acquisition opportunities, generally in the areas of cloud computing and data center related applications.
22
Centcore has two (2) areas of focus. The first, generic data center services, is aimed at hosting applications for a specific user, sometimes referred to as “managed services offerings” or MSO, where the client moves the software licensed from various vendors, or internally developed, into our data center where we maintain the computing, communications and backup environment. Over time we expect to create similar situations with other data centers worldwide based on our clients’ specific needs. We are also evaluating the development of a network of smaller format (5,000 to 10,000 square foot) data centers inside of existing facilities. We believe that this approach may allow us to expand capacity with a minimal capital expenditure. The existing facilities we are targeting generally have sufficient power, often with a substation nearby. These types of buildings usually have backup generators, HVAC, water and security in a form that would support a data center environment.
We have retained experienced professionals in the data center, cyber security and infrastructure services areas to support our needs on a per hour basis, which we believe will allow us to control our costs relative to business activity, without significant staffing internally.
The Vero Technology Ventures (VTV) subsidiary is actively reviewing potential early-stage cloud computing solution vendors and is developing its own artificial intelligence (A.I.) based application set. VTV is currently involved with the formation of a new software development project aimed at applying artificial intelligence (A.I.) to the sales process for various businesses including residential real estate, using cloud computing based software. This initial effort dubbed “Robo Agent”, is expected to be available for initial users in Q3 of FY2026. Later versions may include similar functionality focused on other markets, generally in a “business to consumer” (B2C) selling situation.
In August 2025 we retained a highly qualified executive to begin development of our Robo Agent product set on a consulting basis at a rate of $10,000 per month. We have also recruited three (3) additional contract programmers to accelerate the overall process. In September 2025 we received a contract for development of a new application intended to effect the listing and sale of properties and products specifically related to sports, and the pickleball arena initially. We expect this project to be executed using both internal and external resources and to be completed in late FY2026.
There are several other projects in evaluation, generally aimed at software that would operate on a cloud computing platform such as that which the Company has in its Centcore Data Center.
Results of Operations
The following period-to-period comparisons of our financial results are not necessarily indicative of results for the current period or any future periods. Further, as a result of any acquisitions of other businesses, and any additional pharmacy acquisitions or other such transactions we may pursue, we may experience large expenditures specific to the transactions that are not incident to our operations.
Comparison of the Twelve Months ending December 31, 2025, and 2024.
Revenues
We had revenues of $38,700 for the twelve months ended December 31, 2025, compared to $43,700 in the comparable period. The revenues were related to our subsidiary Centcore, LLC, and include sale of remote backup, general business applications, engineering analysis software and digital marketing related to our residential real estate software development effort.
Operating Expenses
Our total operating expenses for twelve months ended December 31, 2025, were $1,916,733. For the comparable period in 2024, the operating expenses were $1,207,241. The increase is the result of the Company’s focus on establishing the operations of its newly formed subsidiaries as well as development of a software platform in addition to stock-based compensation expense of $824,650 for the year ended December 31, 2025 compared to $702,016 for the comparable period. In addition, we recorded a loss on the impairment of our intangible assets in the amount of $113,021 for the year ended December 31, 2025.
Other Income and Expenses
Interest expense was $1,470,101 for the twelve months ended December 31, 2025, compared to $409,745 for the twelve months ended December 31, 2024. The increase was a result of increased debt balances in the current period.
Interest expense – related parties was $5,797 for the twelve months ended December 31, 2025, compared to $28,474 in the prior period. The decrease was a result of reduced debt balances in the current period as a result of the obligation exchange agreements.
During the twelve months ended December 31, 2025, we recorded a gain on settlement of accounts payable of $562,793 compared to $2,289,283 for the twelve months ended December 31, 2024 as a result of more obligations being settled in in the prior period as compared to the current period.
23
During the twelve months ended December 31, 2025, we recorded a loss on legal settlement of $500,000. There were no comparable transactions in the prior period.
During the twelve months ended December 31, 2025, we recorded a loss on the redemption of preferred shares of $646,653. There were no comparable transactions in the prior period.
During the twelve months ended December 31, 2025, we recorded a gain on the change in fair value of contingent consideration of $150,000. There were no comparable transactions in the prior period.
During the twelve months ended December 31, 2024, we recorded a Gain on termination of operating lease of $869,690. There were no comparable transactions in the current period.
During the twelve months ended December 31, 2024, we recorded a Gain on settlement of notes payable of $515,964. There were no comparable transactions in the current period.
During the twelve months ended December 31, 2025, we recorded a gain of $4,286,515 on the revaluation of derivative liabilities under the default provision of certain securities compare to a loss on the revaluation of derivative liabilities of $4,585,124 in the prior period.
For the twelve months ended December 31, 2025, we had an overall net income available to common shareholders of $145,566, compared to a net loss available to common shareholders of $2,842,256 for the twelve months ended December 31, 2024.
Liquidity and Capital Resources
To date, we have not generated sufficient revenue from operations to support our operations. We have financed our operations through the sale of equity securities and short-term borrowings. As of December 31, 2025, we had cash of approximately $100,857 compared to cash of approximately $3,402 as of December 31, 2024. Our Company’s recurring losses from operations and negative cash flows from operations and our need to raise additional funding to finance our operations raise substantial doubt about our ability to continue as a going concern.
Net cash used in operating activities was $701,585 for the twelve months ended December 31, 2025 compared to cash used in operations for the twelve months ended December 31, 2024, was $514,409. This is the result of establishing the operations of the Company’s newly formed subsidiaries.
During the twelve months ended December 31, 2025, the Company had no investing activities. During the twelve months ended December 31, 2024, the Company paid $5,000 for the acquisition of a business.
Net cash provided by financing activities for the twelve months ended December 31, 2025, was $799,040, compared to $519,973 for the twelve months ended December 31, 2024. Cash provided by financing activities was the result of cash proceeds from sale of series A preferred stock of $125,000, convertible notes payable of $500,000 and notes payable of $200,000, offset by the repayment of principal on the SBA loan in the amount of $25,960.
At December 31, 2025, we had the following current liabilities which are payable in cash: Accounts payable and accrued liabilities of approximately $4 million; notes payable of $.6 million; SBA Loan Payable of approximately $0.4 million; property-related settlements of $3.4 million; accrued interest payable of $0.4 million; and other current liabilities of $0.2 million. We also have the following liabilities which are payable in stock: derivative liabilities of $0.4 million, Series A Preferred Stock liability of approx. $9.4 million, and preferred stock dividends payable of $0.03 million.
SBA Loan
During March 2020, in response to the COVID-19 crisis, the federal government announced plans to offer loans to small businesses in various forms, including the Payroll Protection Program, or “PPP”, established as part of the Corona Virus Aid, Relief and Economic Security Act (“CARES Act”) and administered by the U.S. Small Business Administration (the “SBA”). On April 25, 2020, the Company entered an unsecured Promissory Note with Bank of America for a loan in the original principal amount of $460,400, and the Company received the full amount of the loan proceeds on May 4, 2020 (the “PPP Loan”). The PPP Loan bears interest at the rate of 1% per year.
On July 12, 2023, the Company received confirmation of a payment plan arrangement from the SBA. Pursuant to this payment plan, the Company agreed to pay a minimum of $2,595 each month until the loan is paid in full in July 2028. The SBA confirmed the balance due on the loan, including principal and interest, was $467,117. The Company will amortize the balance due on the loan including interest at the original PPP loan rate of 1% per annum; a gain on the restructure of debt in the amount of $40,622 was recorded on this transaction during the twelve months ended December 31, 2023, and the balance of the loan was recorded at the amount of $421,788 representing the net cash flows discounted at 1%. During the twelve months ended December 31, 2025 and 2024, the Company made principal payments of $25,960 and $28,027 on this loan; during the twelve months ended December 31, 2025 and 2024, the Company recorded interest in the amount of $3,845 and $4,128 on this loan.
24
Bridge Financing
On October 31, 2025, the Company entered into a Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “October 2025 Bridge Note”) with C/M Capital Master Fund, L.P. with the executed documentation providing for up to a potential total funding of $1 million, with an initial funding of $250,000. Under the terms of the 18-month note, the Company is obligated to repay a total of $275,000 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the October 2025 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets.
On December 19, 2025 the “Company entered into a second Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “December 2025 Bridge Note”) with C/M Capital Master Fund, L.P. under the previously executed $1 million funding arrangement. Under the terms of the 18-month note, the Company is obligated to repay a total of $275,000 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the December 2025 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities of the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets.
On February 23, 2026, the Company entered into a third Senior Secured 10% Original Issue Discount Convertible Promissory Note (the “February 2026 Bridge Note”) with C/M Capital Master Fund, L.P. and WVP Emerging Manager Onshore Fund, under the previously executed $1 million funding arrangement. Under the terms of the 18-month note, the Company is obligated to repay a total of $137,500 as the note includes a 10% original issue discount. The note bears no interest unless in default and may be converted into common stock of the Company at $0.15 per share, subject to certain adjustments. The obligations under the February 2026 Bridge Note are guaranteed by the subsidiaries of the Company and include a pledge of the securities the Company’s subsidiaries and a first priority senior security interest in all the Company’s assets. See Subsequent Events.
On April 10, 2026, the Company entered into a 10% Original Issue Discount Convertible Promissory Note (the “April 2026 Bridge Note”) with Pinz Capital with a $50,000 purchase price. The note bears interest of 10%, and has a maturity date 12 months from the date of the note. Under the terms of the note, the Company is obligated to repay a total of $55,000 as the note includes a 10% original issue discount. The note may be converted into common stock of the Company at the lessor of $0.15 or 65% of the lowest trading price of the 10 prior trading days per share, subject to certain adjustments. See Subsequent Events.
Our financial statements as of December 31, 2025, reflect total liabilities of over $24.5 million, including certain reserves for potential liabilities related to ceased operations related largely to long term lease obligations and costs related to the construction of our facilities. A substantial amount of these liabilities may be reversed on negotiations, and it is our goal to settle the remaining amounts with non-cash consideration as noted above.
There can be no assurance that all of these vendors will be willing to settle their obligations with the Company on the proposed terms, or in amounts acceptable to the Company. We remain undercapitalized and until we have resolved most of these obligations it is unlikely that we will be able to attract sufficient capital on reasonable terms to execute our business strategy. We remain committed to the resolution of these outstanding items in a fair and timely manner.
Critical Accounting Policies
We believe that the accounting policies described below are critical to understanding our business, results of operations and financial condition because they involve the use of more significant judgments and estimates in the preparation of our consolidated financial statements. An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and any changes in the assumptions used in making the accounting estimates that are likely to occur could materially impact our consolidated financial statements.
Revenue Recognition
The Company follows the guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (the “new revenue standard”) to all contracts using the modified retrospective method.
Revenue is recognized based on the following five step model:
| - | Identification of the contract with a customer | |
| - | Identification of the performance obligations in the contract | |
| - | Determination of the transaction price | |
| - | Allocation of the transaction price to the performance obligations in the contract | |
| - | Recognition of revenue when, or as, the Company satisfies a performance obligation |
25
The Company primarily earns revenue by providing generic data center services, which is aimed at hosting applications for a specific user, sometimes referred to as “managed services offerings” or MSO, where the client moves the software licensed from various vendors, or internally developed, into our data center where we maintain the computing, communications and backup environment. Data center service revenue is recognized on a monthly basis as the services are provided.
Stock-Based Compensation
We recognize compensation costs to employees under FASB ASC Topic 718, Compensation – Stock Compensation (“ASC 718”). Under FASB ASC 718, companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which performance is required. Share-based compensation cost for stock options is estimated at the grant date based on each option’s fair-value as calculated by the Black-Scholes-Merton (“BSM”) option-pricing model. Share-based compensation arrangements may include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Implications of Being a Smaller Reporting Company
We are a “smaller reporting company” as defined in the Exchange Act. We may take advantage of certain of the scaled disclosures available to smaller reporting companies so long as the market value of our voting and non-voting Common Stock held by non-affiliates is less than $250.0 million measured on the last business day of our most recently completed second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our Common Stock held by non-affiliates is less than $700.0 million measured on the last business day of our most recently completed second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparisons of our financial statements with other public companies difficult or impossible.
26
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
MITESCO, INC.
INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Stockholders of Mitesco, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Mitesco, Inc. (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for each of the years in the two-year 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 the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.
Substantial Doubt about the Company’s ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2, the Company has incurred net losses and working capital deficits. These factors, and the need for additional financing in order for the Company to meet its business plans raises substantial doubt about the Company’s ability to continue as a going concern. Our opinion is not modified with respect to that matter.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
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. The Company 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 Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the 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 judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
F-2
Derivatives
As described in Note 3 and Note 11 of the Company’s consolidated financial statements, during the years ended December 31, 2025 and 2024, the Company analyzes the conversion option of notes payable for derivative accounting under ASC 815, Derivative and Hedging. If the conversion feature within convertible debt meets the requirements to be treated as a derivative, the Company estimates and records the fair value of the derivative liability. The derivative liability is revalued at the end of each reporting period.
We identified the Company’s application of the accounting for derivative liabilities as a critical audit matter. The principal considerations for our determination of this critical audit matter related to the high degree of subjectivity in the Company’s judgments in determining the qualitative inputs of the estimate. Auditing these judgments and assumptions by the Company involves auditor judgment due to the nature and extent of audit evidence and effort required to address these matters.
Our audit procedures related to the accounting for and valuation of derivative liabilities included the following, among others:
| - | Obtaining an understanding of and evaluating management’s process for accounting for and determining the fair value of the derivatives. |
| - | Evaluating the appropriateness of the valuation methods and assumptions utilized to determine the fair value of the derivative financial instruments. |
| - | Evaluating the professional credentials of management’s valuation specialist. |
| - | Utilizing a valuation specialist with the skills and knowledge to assist in (i) evaluating management’s methodology to determine fair value (ii) testing the mathematical accuracy of the models; and (iii) evaluating the reasonableness of the significant assumptions related to volatility. |
| - | Testing the completeness and accuracy of the underlying data utilized by management in the models. |
| /s/ Astra Audit & Advisory LLC | |
| We have served as the Company’s auditor since 2024. | |
| April 15, 2026 | |
F-3
MITESCO, INC.
CONSOLIDATED BALANCE SHEETS
| December 31, | December 31, | |||||||
| 2025 | 2024 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Intangible assets, net | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | $ | ||||||
| Accrued interest | ||||||||
| Accrued interest - related parties | ||||||||
| Derivative liabilities | ||||||||
| Deferred Revenue | ||||||||
| Royalty payable | ||||||||
| Lease liability - operating leases, current | ||||||||
| Notes payable, net of discounts | ||||||||
| Notes Payable, Related Parties, Net | ||||||||
| SBA loan payable | ||||||||
| Convertible Notes Payable, Net | ||||||||
| Other current liabilities | ||||||||
| Preferred stock dividends payable | ||||||||
| Preferred stock dividends payable - related parties | ||||||||
| Legal settlements | ||||||||
| Series A preferred stock liability, current | ||||||||
| Total current liabilities | ||||||||
| Series A preferred stock liability, non-current | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies (Note 16) | ||||||||
| Stockholders’ deficit | ||||||||
| Preferred stock, $0.01 par value, 100,000,000 shares authorized; 500,000 shares designated Series A; 10,000,000 shares designated Series D; 140,000 shares designated as Series F, and 27,324 shares designated Series X. | ||||||||
| Preferred stock, Series D, $ | ||||||||
| Preferred stock, Series F, $ | ||||||||
| Preferred stock, Series X, $ | ||||||||
| Common stock, $ | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | ( | ) | ( | ) | ||||
| Total liabilities and stockholders’ deficit | $ | $ | ||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-4
MITESCO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| Revenue | $ | $ | ||||||
| Operating expenses: | ||||||||
| Cost of operations | ||||||||
| General and administrative | ||||||||
| Software development | ||||||||
| Impairment of intangible assets | ||||||||
| Total operating expenses | ||||||||
| Net Operating Loss | ( | ) | ( | ) | ||||
| Other income (expense): | ||||||||
| Interest expense | ( | ) | ( | ) | ||||
| Interest expense - related parties | ( | ) | ( | ) | ||||
| Gain on termination of operating lease | ||||||||
| Gain on settlement of notes payable | ||||||||
| Loss on legal settlement | ( | ) | ||||||
| Gain on settlement of accounts liabilities | ||||||||
| Loss on redemption of Series A preferred | ( | ) | ||||||
| Change in fair value of contingent considerations | ||||||||
| Gain (loss) on revaluation of derivative liabilities | ( | ) | ||||||
| Total other income (expense) | ( | ) | ||||||
| Consolidated net income (loss) before taxes | ( | ) | ||||||
| Provision for income taxes | ||||||||
| Consolidated net income (loss) after taxes | ( | ) | ||||||
| Preferred stock dividends | ( | ) | ( | ) | ||||
| Preferred stock dividends - related parties | ( | ) | ( | ) | ||||
| Deemed contribution | ||||||||
| Net income (loss) available to common shareholders | $ | $ | ( | ) | ||||
| Basic Net income (loss) per common share | $ | $ | ( | ) | ||||
| Dilutive Net loss per common share | ( | ) | ( | ) | ||||
| Weighted average shares outstanding - basic | ||||||||
| Weighted average shares outstanding - diluted | ||||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-5
MITESCO, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
FOR THE YEAR ENDED DECEMBER 31, 2025 and 2024
| Preferred
Stock Series D | Preferred
Stock Series F | Preferred
Stock Series X | Common Stock | Additional Paid-in | Accumulated | |||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | capital | Deficit | Total | ||||||||||||||||||||||||||||||||||
| Balance, December 31, 2023 | $ | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||||||||||
| Shares issued for compensation | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Series X shares issued as compensation | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Conversion of accounts payable to common stock | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Conversion of debt to common stock by a related party | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Conversion of debt to common stock | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Conversion of Series F Preferred Stock and accrued dividends to common stock | - | - | ( | ) | ( | ) | - | - | - | |||||||||||||||||||||||||||||||||||
| Conversion of Series D Preferred Stock and accrued dividends to common stock | ( | ) | ( | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Conversion of Series X Preferred Stock to common stock | - | - | - | - | ( | ) | ( | ) | ( | ) | - | - | ||||||||||||||||||||||||||||||||
| Exchange of Series D and Series F Preferred for Series A Preferred | ( | ) | ( | ) | ( | ) | ( | ) | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Preferred stock dividends | - | - | - | - | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||||||||
| Shares issued for Series X dividends | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Release of true-up obligation on commitment shares | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Establishment of derivative liability of conversion feature upon default | - | - | - | - | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
| Balance, December 31, 2024 | - | - | $ | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||
| Shares issued for compensation | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Series X shares issued as compensation | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Shares issued for conversion of Series D preferred shares and debt to common stock | ( | ) | ( | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Shares issued for redemption of Series A preferred shares | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Shares issued for Series X dividends | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Preferred stock dividends | - | - | - | - | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Balance, December 31, 2025 | - | $ | - | - | $ | - | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-6
MITESCO, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net income (loss) | $ | $ | ( | ) | ||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Amortization of intangible assets | ||||||||
| Original issue discount charged to interest expense | ||||||||
| Share Based compensation | ||||||||
| Accretion of Series A recorded as interest expense | ||||||||
| Loss on redemption of Series A Preferred | ||||||||
| Loss on legal settlement | ||||||||
| Gain (loss) on lease terminations | ( | ) | ||||||
| Gain on settlement of notes payable | ( | ) | ||||||
| Gain on settlement of accounts payable | ( | ) | ||||||
| (Gain) loss on revaluation of derivative liabilities | ( | ) | ||||||
| Gain on settlement of liabilities | ( | ) | ||||||
| Impairment of intangible assets | ||||||||
| Change in fair value of contingent considerations | ( | ) | ||||||
| Bad debt expense | ||||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ( | ) | ||||
| Prepaid expenses and other current assets | ( | ) | ||||||
| Accounts payable and accrued liabilities | ||||||||
| Deferred Revenue | ||||||||
| Accrued interest | ||||||||
| Accrued interest - related parties | ||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Cash paid for acquisition of business | ( | ) | ||||||
| Net cash used in investing activities | ( | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from sales of Series A Preferred Stock | ||||||||
| Principal payments on SBA Loan | ( | ) | ( | ) | ||||
| Proceeds from convertible notes payable | ||||||||
| Proceeds from notes payable, net of discounts | ||||||||
| Net cash provided by financing activities | ||||||||
| Net change in cash and cash equivalents | ||||||||
| Cash and cash equivalents at beginning of period | ||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-7
MITESCO, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Years | ||||||||
| Ended | ||||||||
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Interest paid | $ | $ | ||||||
| Income taxes paid | $ | $ | ||||||
| Supplemental disclosure of financing cash flow information: | ||||||||
| Shares issued for Series X dividends | $ | $ | ||||||
| Preferred stock dividend | $ | $ | ||||||
| Shares issued for redemption of Series A shares | $ | $ | ||||||
| Shares issued for settlement of Series D, notes payable, and accrued liabilities – related party | $ | $ | ||||||
| Conversion of accounts payable to common stock | $ | $ | ||||||
| Conversion of notes payable and accrued interest to common stock | $ | $ | ||||||
| Conversion of notes payable to common stock - related party | $ | $ | ||||||
| Conversion of Series F Preferred Stock and accrued dividends to common stock | $ | $ | ||||||
| Conversion of Series D Preferred Stock and accrued dividends to common stock | $ | $ | ||||||
| Conversion of Series X Preferred Stock and accrued dividends to common stock | $ | $ | ||||||
| Conversion of Series F and Series D preferred stock to Series A preferred stock | $ | $ | ||||||
| Conversion of Notes Payable and accrued interest to Series A preferred stock | $ | $ | ||||||
| Royalty payable issued for purchase of business | $ | $ | ||||||
| Release of true-up obligation on commitment shares | $ | $ | ||||||
| Establishment of derivative liability of conversion feature upon default | $ | $ | ||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-8
MITESCO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024
Note 1: Description of Business
Company Overview
Mitesco, Inc. (the “Company,” “we,” “us,” or “our”) was formed in the state of Delaware on January 18, 2012. On December 9, 2015, we restructured our operations and acquired Newco4pharmacy, LLC, a development stage company which sought to acquire compounding pharmacy businesses. As a part of the restructuring, we completed a “spin out” of our former business line. On April 24, 2020, we changed our name to Mitesco, Inc. and the Company completed a move of its corporate status to Nevada from Delaware in order to effect reduced costs.
From 2020 through 2022, our operations were focused on establishing medical clinics utilizing Nurse Practitioners under The Good Clinic name and development and acquisition of telemedicine technology. We opened our first The Good Clinic in Minneapolis, Minnesota in the first quarter of 2021 and had six operating clinics during the year ended December 31, 2022, with two additional sites under contract. In the fourth quarter of fiscal 2022, we made the strategic decision to close the entire clinic operation and release our staff due to a lack of profitability.
We are a holding company seeking to provide products, services and technology. We have a number of near-term opportunities that we hope to pursue, assuming the capital markets make sufficient funding available at reasonable rates. During the first quarter of 2024 we recruited a number of individuals to a newly formed Advisory Board, who might assist the Company in determining the viability of certain ventures going forward. These individuals have a background in data center services, cyber and data security and software applications related to infrastructure design, implementation and management including geographical information systems (GIS).
In June 2024 we announced the formation of two (2) new wholly owned business units, Centcore, LLC, who is providing data center services including cloud computing and application hosting, and Vero Technology Ventures, LLC, whose aim is to seek investment and acquisition opportunities, generally in the areas of cloud computing and data center related applications.
Centcore has two (2) areas of focus. The first, generic data center services, is aimed at hosting applications for a specific user, sometimes referred to as “managed services offerings” or MSO, where the client moves the software licensed from various vendors, or internally developed, into our data center where we maintain the computing, communications and backup environment. The second focus involves hosting application software developed by software vendors, from which they will sell the use of the software by their end user clients on a “cloud” basis. By taking this approach, we hope to gain the business of the vendor, and their clients, perhaps allowing us to grow at a faster rate with lower cost of sales. We have developed the “Centcore Partner Program” where we will help promote the software vendors who are hosting in our data centers. If we are successful helping the vendor grow his business, we will have provided a “value added service”, and benefit from increased utilization of our computing resources by not only the vendor, but also his new end user clients. Our initial focus for this area is on software providers who serve the “infrastructure” market doing design, engineering, construction and maintenance of significant assets. We desire to create “life cycle” relationships with both the design teams, and owners which may include private owners such as manufacturers and utilities, or publicly owned assets for municipalities, states or federal governments, domestically and internationally.
We have retained proven professionals in the data center, cyber security and infrastructure services areas to support our needs on a per hour basis, which we believe will allow us to control our costs relative to business activity, without significant staffing internally.
The Vero Technology Ventures (“VTV”) subsidiary is actively reviewing potential early-stage cloud computing solution vendors and is developing its own artificial intelligence (A.I.) based application set. VTV is currently involved with the formation of a new software development project aimed at applying artificial intelligence (A.I.) to the sales process for various businesses including residential real estate using cloud computing-based software. This initial effort of project development has been dubbed “Robo Agent.” Later versions may include similar functionality focused on other markets, generally in a “business to consumer” (B2C) selling situation.
In August 2025 we retained a highly qualified
executive to begin development of our Robo Agent product set on a consulting basis at a rate of $
F-9
Note 2: Going Concern
As of December 31, 2025, the Company had
cash and cash equivalents of approximately $
As a result of these factors, there is substantial doubt about the ability of the Company to continue as a going concern for one year from the date the financial statements are issued. The Company’s continuance is dependent on raising capital and generating revenues sufficient to sustain operations. However, as of the date of these consolidated financial statements, no formal agreement exists.
The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts classified as liabilities that might be necessary should the Company be forced to take any such actions.
Note 3: Summary of Significant Accounting Policies
Basis of Presentation – The consolidated financial statements are prepared in conformity with accounting principles accepted in the United States of America (“GAAP”).
Principles of Consolidation – The accompanying consolidated financial statements include the accounts of Mitesco, Inc., and its wholly owned subsidiaries Mitesco NA, LLC, The Good Clinic, LLC, Vero Technology Ventures, LLC, and Centcore, LLC. In addition, we relied on the operating activities of certain legal entities in which we did not maintain a controlling ownership interest, but over which we had indirect influence and of which we were considered the primary beneficiary. These entities are typically subject to nominee ownership and transfer restriction agreements that effectively transfer the majority of the economic risks and rewards of their ownership to the Company. The Company’s management, restrictions and other agreements concerning such nominee-owned entities typically include both financial terms and protective and participating rights to the entities’ operating, strategic and non-clinical governance decisions which transfer substantial powers over and economic responsibility for these entities to the Company. As such, the Company applies the guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810 – Consolidation (“ASC 810”), to determine when an entity that is insufficiently capitalized or not controlled through its voting interests, referred to as a variable interest entity should be consolidated. All intercompany balances and transactions have been eliminated.
Use of Estimates - The preparation of these financial statements requires our management to make estimates and assumptions about future events that affect the amounts reported in the financial statements and related notes. Future events and their effects cannot be determined with absolute certainty. Therefore, the determination of estimates requires the exercise of judgment.
Cash - The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.
Property and Equipment - Property and equipment
is recorded at the lower of cost or estimated net recoverable amount and is depreciated using the straight-line method over its estimated
useful life.
| Years | ||||
| Office equipment | ||||
| Furniture & fixtures | ||||
| Machinery & equipment | ||||
| Leasehold improvements |
Revenue Recognition – The Company recognizes revenue in accordance with ASC 606 when it has satisfied the performance obligations under an arrangement with the customer reflecting the terms and conditions under which products or services will be provided, the fee is fixed or determinable, and collection of any related receivable is probable. ASC Topic 606, “Revenue from Contracts with Customers” establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements: 1) identify the contract with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to performance obligations in the contract; and 5) recognize revenue as the performance obligation is satisfied.
F-10
Our revenues generally relate to data center services. Revenues are recorded during the period our obligations to provide services are satisfied. The Company’s performance obligation for its revenue stream is to provide the access to its data centers to the customer, and revenues associated with completed sales are recognized rateably over the contractual term as services are provided to the customer. There is no significant financing component to the Company’s sales.
In September 2025 we received a contract for development
of a new application intended to effect the listing and sale of properties and products specifically related to sports. We expect this
project to be executed using both internal and external resources and to be completed in late FY2026. As of December 31, 2025, we have
received an upfront fee of $
Capitalized Software Development Costs - Software development costs primarily consist of personnel costs. We capitalize software development costs upon the establishment of technological feasibility and prior to the availability of the product for general release to clients for software sold to third parties. During the years ended December 31, 2025, and 2024 no costs have been capitalized as we have not yet reached technological feasibility. We begin to amortize capitalized costs when a product is available for general release to clients. Amortization expense is determined on a product-by-product basis at a rate not less than straight-line basis over the software’s remaining estimated economic life.
Software Research and Development Costs - Research and development
costs are expensed as incurred and include compensation costs for engineering and product management personnel, third-party contractor
expenses, software development tools and other expenses related to researching and developing new solutions or upgrading and enhancing
existing solutions that do not qualify for capitalization. We expensed research and development costs of $
Stock-Based Compensation - We recognize the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which performance is required. Share-based compensation cost for stock options is estimated at the grant date based on each option’s fair-value as calculated by the Black-Scholes-Merton (“BSM”) option-pricing model. Share-based compensation arrangements may include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant.
Convertible Instruments - The Company reviews the terms of convertible debt and equity instruments to determine whether there are conversion features or embedded derivative instruments including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. In circumstances where the convertible instrument contains more than one embedded derivative instrument, including conversion options that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single compound instrument. Also, in connection with the sale of convertible debt and equity instruments, the Company may issue free standing warrants that may, depending on their terms, be accounted for as derivative instrument liabilities, rather than as equity. When convertible debt or equity instruments contain embedded derivative instruments that are to be bifurcated and accounted for separately, the total proceeds allocated to the convertible host instruments are first allocated to the fair value of the bifurcated derivative instrument. The remaining proceeds, if any, are then allocated to the convertible instruments themselves, usually resulting in those instruments being recorded at a discount from their face amount. When the Company issues debt securities, which bear interest at rates that are lower than market rates, the Company recognizes a discount, which is offset against the carrying value of the debt. Such a discount from the face value of the debt, together with the stated interest on the instrument, is amortized over the life of the instrument through periodic charges to income. In addition, certain conversion features are recognized as beneficial conversion features to the extent the conversion price as defined in the convertible note is less than the closing stock price on the issuance of the convertible notes.
Derivative Financial Instruments - Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible notes are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model the Company uses for determining the fair value of its derivatives is the Monte Carlo Model. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as discount rates and stock price volatilities.
Per Share Data - Basic income (loss) per
share is computed by dividing net loss by the weighted average number of common shares outstanding for the year. Diluted loss per share
is computed by dividing net loss by the weighted average number of common shares outstanding plus common stock equivalents (if dilutive)
related to warrants, options, and convertible instruments. As of December 31, 2025 the effect of
F-11
Income Taxes - The Company accounts for income taxes under the asset and liability method which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s consolidated financial statements or tax returns. In estimating future tax consequences, the Company considers all expected future events other than enactments of changes in the tax laws or rates. The Company has a sizable tax loss carryforward at this time and as a result it is unlikely that it will have a need for payment of taxes in the near term.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will not be realized. The Company has determined that a valuation allowance is needed due to recent taxable net operating losses and the limited taxable income in the carryback periods. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income or expense in the period that includes the enactment date. Deferred 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 and certain tax loss carryforwards, less any valuation allowance.
The Company accounts for uncertain tax positions as required in that a position taken or expected to be taken in a tax return is recognized in the consolidated financial statements when it is more likely than not (i.e., a likelihood of more than 50%) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than 50% of being realized upon ultimate settlement. The Company does not have any material unrecognized tax benefits. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as components of interest expense and other expense, respectively, in arrival at pretax income or loss. The Company does not have any interest and penalties accrued. The Company is no longer subject to U.S. federal, state, and local income tax examinations for the years before 2012.
Long-lived Assets
The Company amortizes acquired definite-lived intangible assets over their estimated useful lives. Other indefinite-lived intangible assets are not amortized but subject to annual impairment tests. In accordance with ASC 360 “Property Plant and Equipment,” the Company reviews the carrying value of intangibles subject to amortization and long-lived assets for impairment throughout the year or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Impairment of Long-Lived Assets - Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the consolidated balance sheet and reported at the lower of the carrying amount or fair value, less costs to sell and are no longer depreciated. The assets and liabilities of a disposal group classified as held-for-sale would be presented separately in the appropriate asset and liability sections of the consolidated balance sheet, if material.
Financial Instruments and Fair Values - The fair value of a financial instrument represents the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Fair value estimates are made at a specific point in time, based upon relevant market information about the financial instrument. In determining fair value, we use various valuation methodologies and prioritize the use of observable inputs. We assess the inputs used to measure fair value using a three-tier hierarchy based on the extent to which inputs used in measuring fair value are observable in the market:
| Level 1 – | inputs include exchange quoted prices for identical instruments and are the most observable. |
| Level 2 – | inputs include brokered and/or quoted prices for similar assets and observable inputs such as interest rates. |
| Level 3 – | inputs include data not observable in the market and reflect management judgment about the assumptions market participants would use in pricing the asset or liability. |
The use of observable and unobservable inputs and their significance in measuring fair value are reflected in our hierarchy assessment. The carrying amount of cash, prepaid assets, accounts payable and accrued liabilities approximate fair value due to the short-term maturities of these instruments. Because cash and cash equivalents are readily liquidated, management classifies these values as Level 1. The fair value of the derivative liabilities approximates their book value as the instruments are short-term in nature and contain market rates of interest. Because there is no ready market or observable transactions, management classifies the derivative liabilities as Level 3.
F-12
Segments
The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer. The CODM allocates resources and evaluates the performance of the Company at the consolidated level using information about its revenues, gross profit, and income from operations. All significant operating decisions are based upon an analysis of the Company as one operating segment, which is the same as its reporting segment.
Recent Accounting Standards
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes. This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendment should be applied on a prospective basis while retrospective application is permitted. The Company adopted this standard effective January 1, 2025, which did not have a material impact on the Company’s consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, and in January 2025, the FASB issued ASU 2025-01, Clarifying the Effective Date (“ASU 2025-01”). The amendments are intended to enhance disclosures regarding an entity’s costs and expenses by requiring additional disaggregated information disclosures about certain income statement expense line items. The amendments, as clarified by ASU 2025-01, are effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”). ASU 2025-05 amends ASC, Financial Instruments – Credit Losses (Topic 326) (“ASC Topic 326”) to simplify how entities measure credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC, Revenue from Contracts with Customers (Topic 606) (“ASC Topic 606”). This update allows entities to assume that current conditions as of the balance sheet date will remain unchanged for the remaining life of the asset when estimating expected credit losses. ASU 2025-05 is effective for interim and annual periods beginning after December 15, 2025. Early adoption is permitted. The Company has not yet adopted ASU 2025-05 but does not expect the adoption of this standard to have a material impact on the Company’s consolidated financial statements.
There are various other updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries and are not expected to have a material impact on the Company’s consolidated financial position, results of operations or cash flows.
Note 4: Business Acquisition
On December 6, 2024, the Company entered into
an Exclusive Source Code License agreement (the “License Agreement”) between AgingTopic, LLC (“AgingTopic”) and
the Company where the Company has acquired, subject to certain payment milestones, the source code and business activities of AgingTopic,
which constitutes substantially all of AgingTopic’s assets utilized in the creation of advertising revenue from blog postings..
The agreement calls for a $
This acquisition closed on December 6, 2024. The acquisition of AgingTopic is being accounted for as a business combination under ASC 805. The royalty payable is accounted for as a contingent consideration liability under ASC 805, with changes in fair value of the expected royalty amount recognized in current earnings. AgingTopic had not yet generated revenues prior to the time of acquisition.
As of December 31, 2025, Company determined it
would not actively pursue the development of the AgingTopic Business and as such considered the payment of the royalty payments as remote
and recorded a $
Note 5: Intangible assets
The following table represents the balances of intangible assets as of December 31, 2025 and 2024;
| December 31, 2025 | December 31, 2024 | |||||||
| Website Domains | $ | $ | ||||||
| Total Intangible assets | ||||||||
| Accumulated Amortization – website domains | ( | ) | ||||||
| Net intangible assets | $ | $ | ||||||
On December 6, 2024, the Company closed on its
acquisition of the AgingTopic Business and allocated the entire $
During the year ended December 31, 2025, the Company
determined it would not actively pursue the development of the AgingTopic business and as such recorded an impairment expense of $
The Company recorded amortization expense of $
F-13
Note 6: Accounts Payable and Accrued Liabilities
Accounts payable and accrued liabilities consisted of the following at December 31, 2025, and 2024:
| December 31, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Trade accounts payable | $ | $ | ||||||
| Accrued payroll and payroll taxes | ||||||||
| Total accounts payable and accrued liabilities | $ | $ | ||||||
Note 7: Right to Use Assets and Lease Liabilities – Operating Leases
The Company had operating leases for its clinics for which the Company is currently in negotiations with the Lessors to settle the remaining amounts owed after closing the clinic facilities. The Company’s lease expense was entirely comprised of operating leases and is reported as a component of discontinued operations as a result of the closing of the clinics and the subsequent sale of the assets.
Operating lease liabilities are summarized below:
| December 31, 2025 | December 31, 2024 | |||||||
| Lease liability | $ | $ | ||||||
| Less: current portion | ( | ) | ( | ) | ||||
| Lease liability, non-current | $ | $ | ||||||
As a result of closing the facilities, the Company has made no further lease payments during the year ending December 31, 2024, or the year ending December 31, 2025. As of December 31, 2025, the Company has either settled amounts owed or entered into default judgements for all leases except for the office lease, noted in the above table, which we believe is nominal. For all leases for which a legal settlement has been entered into, all amounts have been reclassified to legal settlements as of December 31, 2025.
Note 8: SBA Loan Payable
PPP Loan Conversion to SBA Loan
During March 2020, in response to the COVID-19
crisis, the federal government announced plans to offer loans to small businesses in various forms, including the Payroll Protection Program,
or (“PPP”), established as part of the Corona Virus Aid, Relief and Economic Security Act (“CARES Act”) and administered
by the U.S. Small Business Administration (the “SBA”). On April 25, 2020, the Company entered an unsecured Promissory Note
with Bank of America for a loan in the original principal amount of $
On July 12, 2023, the Company received confirmation
of a payment plan arrangement from the SBA. Pursuant to this payment plan, the Company agreed to pay a minimum of $
The balance as of December 31, 2025, was $
Note 9: Notes Payable and Convertible Notes Payable
Notes Payable
The following table summarizes the outstanding notes payable as of December 31, 2025 and 2024, respectively:
| December 31, 2025 | December 31, 2024 | |||||||
| Kishon Note | $ | $ | ||||||
| Finnegan Note 1 | ||||||||
| Finnegan Note 2 | ||||||||
| Finnegan Note 3 | ||||||||
| 2025 Bridge Notes | ||||||||
| Total Notes Payable | ||||||||
| Current Portion | ( | ) | ( | ) | ||||
| Long-term portion | $ | $ | ||||||
F-14
Kishon Note
On May 10, 2022, the Company entered into a Securities
Purchase Agreement (the “Kishon Agreement”) with Kishon Investments, LLC (“Kishon”) with respect to the sale and
issuance to Kishon of: (i) an initial commitment fee in the amount of $
The Kishon Note was issued in the principal amount
of $
During the year ended December 31, 2023, a default
penalty in the amount of $
At December 31, 2025, principal and interest in
the amount of $
Finnegan Note 1
On May 23, 2022, the Company issued a
Finnegan Note 2
On May 26, 2022, the Company issued a
F-15
Finnegan Note 3
On August 4, 2022, the Company issued a
On April 24, 2025, the Company entered into an Obligation Exchange
Agreement with Finnegan whereby Finnegan agreed to settle the above notes, accrued interest and other obligations in consideration of
the issuance of
At December 31, 2025, all principal and accrued
interest were fully satisfied and retired on these notes. At December 31, 2024, principal and accrued interest in the amount of $
2025 Bridge Notes
On May 6, 2025, the Company entered into a short
term note payable agreement with one of its investors and received cash proceeds of $
On May 19, 2025, the Company entered into Senior
Secured 5% Original Issue Discount Promissory Notes with three of its institutional investors for gross proceeds of $
On July 21, 2025, the Company entered into Senior
Secured
Aggregate interest expense on the notes
payable was $
Convertible Notes Payable
On October 31, 2025, the Company entered into
a Senior Secured
F-16
On December 19, 2025, the Company entered into
a Senior Secured
On December 19, 2025, the Company entered into
a Senior Secured
Note 10: Notes Payable – Related Parties
The following table summarizes the outstanding related party notes payable as of December 31, 2025 and 2024, respectively;
| December 31, 2025 | December 31, 2024 | |||||||
| Lindstrom Note | ||||||||
| Lindstrom Note 2 | ||||||||
| Notes Payable | ||||||||
| Current Portion, net of discount | $ | - | $ | |||||
| Long-term portion, net of discount | ||||||||
Lindstrom Note
On May 26, 2022, the Company issued a 10% Promissory
Note in the principal amount of $
Lindstrom Note 2
On November 29, 2022, the Company issued a promissory
note (the “Lindstrom Note 2”) in a related party transactions to Jenny Lindstrom, who was the Company’s former Vice
President and Chief Legal Officer. The Lindstrom Note 2 has a due date of
On
At December 31, 2025, all principal and accrued
interest were fully satisfied and retired on these notes. At December 31, 2024, there was principal and interest in the aggregate amount
of $
Aggregate interest expense on the notes payable
– related parties was $
Note 11: Derivative Liabilities
Certain of the Company’s convertible notes and warrants contain features that create derivative liabilities. The pricing model the Company uses for determining fair value of its derivatives is the Monte Carlo Model. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income. The derivative components of these notes are valued at issuance, at conversion, at restructuring, and at each period end.
F-17
Derivative liability activity for the years ended December 31, 2025 and 2024, is summarized in the table below:
| December 31, 2023 | $ | |||
| True-up features settled | ( | ) | ||
| Establishment upon default provisions | ||||
| Loss on revaluation | ||||
| December 31, 2024 | $ | |||
| Gain on revaluation | ( | ) | ||
| December 31, 2025 | $ |
The following assumptions were used for the valuation of the derivative liability associated with this obligation:
| ● | The stock price on the date of valuation represents the fair market value of the stock | |
| ● | The notes convert with variable conversion prices based on the percentages of the lowest trades over the prior 30 trading days | |
| ● | The holder would automatically convert the note immediately (based on ownership or trading volume limitations) if the registration were effective and the Company was not in default |
Note 12: Series A preferred stock
On October 28, 2024, the Company filed a Certificate
of Designation, Preferences and Rights of the Series A Preferred Stock with the Nevada Secretary of State (the “Certificate of Designation”).
The Company authorized
Holders of shares of the Series A Preferred Stock are not entitled to receive any dividends, and the security bears no interest.
The Series A Preferred Stock will rank, with respect to rights to the payment of dividends and the distribution of assets in the event of any liquidation, dissolution or winding up of the Company, (i) senior to all classes or series of the Company’s Common Stock, and to all other equity securities issued by the Company; and (ii) effectively junior to all existing and future indebtedness (including indebtedness convertible into our Common Stock or preferred stock) of the Company and to any indebtedness and other liabilities of (as well as any preferred equity interest held by others in) existing subsidiaries of the Company.
In addition to any other rights provided by law, except where the vote or written consent of the holders of a greater number of shares is required by law or by another provision of the Articles of Incorporation, without first obtaining the affirmative vote at a meeting duly called for such purpose or the written consent without a meeting of the majority of the outstanding Series A Preferred Stock, voting together as a single class, the Company shall not: (a) amend or repeal any provision of, or add any provision to, its Articles of Incorporation or bylaws, or file any certificate of designations or certificate of amendment, if such action would adversely alter or change in any respect the preferences, rights, privileges or powers, or restrictions provided for the benefit, of the Series A Preferred Stock, regardless of whether any such action shall be by means of amendment to the Articles of Incorporation or by merger, consolidation or otherwise; or (b) without limiting the provisions of the Certificate of Designation, circumvent a right of the Series A Preferred Stock.
As a result of the mandatory redemption features
requiring the Company to repay the Series A in either cash of shares of Common Stock of the Company, under ASC 480, the Company is required
to record the full redemption value of the Series A preferred shares as a liability on the accompanying balance sheet. The Company has
recorded the redemption value based on the
During the year ended December 31, 2025, the Company
issued
During the year ended December 31, 2025, the Company
redeemed
F-18
The following table provides the maturities of Series A preferred stock redemptions at December 31, 2025:
| Series A | ||||
| Preferred Stock | ||||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 and thereafter | ||||
| Total future undiscounted redemption payments | ||||
| Less: Interest | ( | ) | ||
| Present value of redemption payments | ||||
| Current portion | ( | ) | ||
| Long term portion | $ | |||
Note 13: Stockholders’ Deficit
Common Stock
The Company has authorized
Common Stock Transactions During the Year Ended December 31, 2025
During the year ended December 31, 2025, the Company
issued
During the year ended December 31, 2025, the Company
issued
During the year ended December 31, 2025, the Company
recorded stock-based compensation of $
During the year ended December 31, 2025, the Company
issued
During the year ended December 31, 2025, the Company
entered into Obligation Exchange Agreements with
Common Stock Transactions During the Year Ended December 31, 2024
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
During the year ended December 31, 2024, the Company
issued
Preferred Stock
We are authorized to issue
F-19
Series D Preferred Stock
The Series D Preferred Stock has a par value of
$
Series D Preferred Stock Transactions During the Year Ended December 31, 2025
During the year ended December 31, 2025, the Company entered into an Obligation Exchange Agreements with Lindstrom whereby the outstanding Series D Preferred Stock and all accrued dividends were exchanged for shares of Company common stock.
The Company accrued dividends in the amount of
$
Series D Preferred Stock Transactions During the Year Ended December 31, 2024
During the year ended December 31, 2024, a holder
of
The Company accrued dividends in the amount of
$
Series F Preferred Stock
On March 23, 2023, the Company filed a Certificate
of Designations, Preferences and Rights of Series F 12% PIK $
Holders of shares of the Series F Preferred Stock are entitled to receive payment-in-kind dividends payable only in additional shares of Series F Preferred Stock (“PIK Dividends”) at rate of 12% per annum.
The Series F Preferred Stock will be convertible into common stock of the Company upon the listing of the Company’s stock on any of the following trading markets: the NYSE, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, or the Nasdaq Global Select Market. The conversion price will be calculated as 65% of the volume-weighted average price of the Company’s common stock on the conversion date. The number of shares issuable upon conversion will be calculated as the liquidation preference of the Series F Preferred stock plus any accrued but unpaid dividends divided by the conversion price.
There are no shares of Series F shares outstanding as of December 31, 2025 or 2024.
Series F Preferred Stock Transactions During the Year Ended December 31, 2024
On May 17, 2024, the holders of approximately
During the year ended December 31, 2024, holders
of
The Company accrued dividends in the amount of
$
Series X Preferred Stock
The Company has
Series X Preferred Stock Transactions During the Year Ended December 31, 2025
During the year ended December 31, 2025, the Company
issued
F-20
During the year ended December 31, 2025, the Company
issued
The Company accrued dividends in the amount of $
During the year ended December 31, 2024, the Company
issued
Series X Preferred Stock Transactions During the Year Ended December 31, 2024
During the year ended December 31, 2024, the Company issued 141,122 shares of restricted common stock for the payment of dividends due for its Series X Preferred stock as noted above.
During the year ended December 31, 2024, holders
of
The Company accrued dividends in the amount of
$
Stock Options
On January 21, 2021, the Company filed a Form S-8 containing the Mitesco Omnibus Securities and Incentive Plan (“the Plan”) with the SEC. In Sections 4.2 and 4.3 of the Plan it is noted that the Board of Directors has the authority for the administration of the Plan. On January 7, 2024, the Board of Directors voted to a) cancel, revoke and terminate any previously issued options that have not already been exercised. For a number of technical reasons, the Plan is no longer valid, and in addition to cancellation of any outstanding options, the Board has voted to formally terminate the Plan as of January 7, 2024.
The following table summarizes the transactions involving options to purchase shares of the Company’s common stock:
| Shares | Weighted- Average Exercise Price ($) | |||||||
| Outstanding at December 31, 2023 | $ | |||||||
| Granted | ||||||||
| Cancelled/Expired | ( | ) | $ | |||||
| Exercised | ||||||||
| Outstanding at December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Cancelled/Expired | ||||||||
| Exercised | ||||||||
| Outstanding at December 31, 2025 | $ | |||||||
| Options vested and exercisable | $ | |||||||
Warrants
The Company has announced that it intends to cancel
all outstanding warrants, and certain language to complete this has been added to all documents related to the conversion of outstanding
debts, notes, accounts payable and other senior securities.
| Weighted | Weighted | |||||||||||||||||||||
| Weighted | Average | average | ||||||||||||||||||||
| average | Exercise | exercise | ||||||||||||||||||||
| Range of | Number of | remaining | price of | Number of | price of | |||||||||||||||||
| exercise | warrants | contractual | outstanding | warrants | exercisable | |||||||||||||||||
| prices | outstanding | life (years) | warrants | exercisable | warrants | |||||||||||||||||
| | | | ||||||||||||||||||||
| $ | ||||||||||||||||||||||
| $ | $ | |||||||||||||||||||||
F-21
The following table summarizes the transactions involving options to purchase shares of the Company’s common stock:
| Shares | Weighted- Average Exercise Price ($) | |||||||
| Outstanding at December 31, 2023 | $ | |||||||
| Granted | $ | |||||||
| Cancelled | ( | ) | $ | ( | ) | |||
| Outstanding at December 31, 2024 | $ | |||||||
| Granted | $ | |||||||
| Cancelled | ( | ) | $ | ( | ) | |||
| Exercised | $ | |||||||
| Outstanding at December 31, 2025 | $ | |||||||
At December 31, 2025, there was no intrinsic value on the issued or vested warrants.
During the years end December 31, 2025 and 2024,
in connection with the settlements of debt, Series D preferred and Series F preferred, the investors also agreed to cancel
Note 14: Fair Value of Financial Instruments
The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at December 31, 2025, and December 31, 2024.
| December 31, 2025 | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Liabilities | ||||||||||||||||
| Derivative liabilities | $ | $ | $ | $ | ||||||||||||
| December 31, 2024 | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Liabilities | ||||||||||||||||
| Derivative liabilities | $ | $ | $ | $ | ||||||||||||
Note 15: Income Taxes
Deferred income taxes result from the temporary differences primarily attributable to amortization of intangible assets and debt discount and an accumulation of net operating loss carryforwards for income tax purposes with a valuation allowance against the carryforwards for book purposes.
In assessing the realizability of deferred tax
assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized.
Included in deferred tax assets are Federal and State net operating loss carryforwards of approximately $
F-22
For the years ended December 31, 2025 and 2024, the expected tax expense (benefit) based on the U. S. federal statutory rate is reconciled with the actual tax provision (benefit) as follows:
| For the Years Ended December 31, | ||||||||||||||||
| 2025 | 2024 | |||||||||||||||
| Expected tax at statutory rates | ||||||||||||||||
| Federal | $ | % | $ | ( | ) | % | ||||||||||
| State | ( | ) | ( | )% | ( | )% | ||||||||||
| Permanent Differences | ( | ) | ( | )% | ( | ) | % | |||||||||
| Temporary difference for derivative gain | ( | ) | ( | )% | ( | )% | ||||||||||
| Temporary difference for stock compensation | % | ( | )% | |||||||||||||
| Other | % | ( | )% | |||||||||||||
| Prior Year True-Ups | % | % | ||||||||||||||
| Current Year Change in Valuation Allowance | ||||||||||||||||
| Federal | % | ( | ) | % | ||||||||||||
| State | ( | ) | ( | )% | ( | )% | ||||||||||
| Income tax expense | $ | % | $ | % | ||||||||||||
Deferred income taxes reflect the tax impact of temporary differences between the amounts of assets and liabilities for financial reporting purposes and such amounts as measured by tax laws and regulations.
Deferred income taxes include the net tax effects
of net operating loss (NOL) carryforwards and the temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes.
| As of | ||||||||
| December 31, 2025 | December 31, 2024 | |||||||
| Deferred Tax Assets (Liabilities): | ||||||||
| Accrued payroll | $ | $ | ||||||
| ASC842-ROU (Liability) | ||||||||
| Loss from derivatives | ( | ) | ( | ) | ||||
| Stock based compensation | ( | ) | ( | ) | ||||
| Depreciation | ||||||||
| Net operating loss | ||||||||
| Net deferred tax assets (liabilities) | ||||||||
| Valuation allowance | ( | ) | ( | ) | ||||
| Net deferred tax assets (liabilities) | $ | $ | ||||||
Note 16: Commitments and Contingencies
Legal
From time to time, we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business.
On June 23, 2022, The Good Clinic LLC was notified
that a former employee had filed a lawsuit for wrongful termination. The Good Clinic believes the lawsuit is without merit. Mitesco (Company)
was not named in the suit. We have settled this matter as of January 11, 2024, for total consideration consisting of a cash payment of
$
On October 25, 2022, the Company was notified
that a vendor filed a lawsuit related to a contract dispute naming both The Good Clinic and The CEO of the Good Clinic. This suit was
settled on May 5, 2023, and dismissed with prejudice on May 12, 2023. The settlement included the issuance of the Company’s restricted
common stock. As a part of the settlement the Company issued
The Company has a number of legal situations involved with the winding down of its clinic’s business activities. These include claims regarding certain construction contracts and cancellation of leases as noted below:
Nordhaus Clinic
On November 1, 2020, we entered into an agreement
to open a clinic in Minneapolis, Minnesota. The initial lease term is
F-23
Egan Clinic a.k.a. Vikings
On October 14, 2021, we entered into an agreement
to open a clinic in Eagan, Minnesota, which began operations in the fourth quarter of 2021. The initial lease term is for
St. Paul Clinic a.k.a. The Grove
On August 31, 2021, we entered into an agreement
to open a clinic in St. Paul, Minnesota, which began operations in the fourth quarter of 2021. The initial lease term is for
St. Louis Park Clinic a.k.a. Excelsior & Grand
On May 24, 2021, we entered into an agreement
to open a clinic in St. Louis Park, Minnesota, which began operations in the third quarter of 2021. The initial lease term is
Eden Prairie Clinic a.k.a. TP Elevate
On June 8, 2021, we entered into an agreement
to open a clinic in Eden Prairie, Minnesota, which began operation in the third quarter of 2021. The initial lease term is
Maple Grove Clinic a.k.a. Arbor Lakes
On October 8, 2021, we entered into an agreement
to open a clinic in Maple Grove, Minnesota which began operation in the fourth quarter of 2021. The initial lease term is for
Radiant Clinic a.k.a. LMC Welton
On September 9, 2021, we entered into an agreement
to open a clinic in Denver, Colorado, which was expected to begin operation in the first quarter of 2023 but possession of which has been
relinquished to the landlords. The initial lease term is for
F-24
Quincy Clinic a.k.a. 1776 Curtis
On September 28, 2021, we entered into an agreement
to open a clinic in Denver, Colorado, which was expected to begin operation in the first quarter of 2023 but possession of which has been
relinquished to the landlords. The initial lease term is for
| LOCATION | PROPERTY NAME | ORIGINAL OBLIGATION | SETTLEMENT AMOUNT | DATE OF AWARD | INTEREST RATE | INTEREST ACCRUED ON SETTLEMENT | TOTAL SETTLEMENT OBLIGATION | TYPE OF SETTLEMENT | ||||||||||||||||||
| WAYZETTA, MN | WAZETTA BAY | $ | $ | $ | CASH PAYMENT OBLIGATION | |||||||||||||||||||||
| EAGAN, MN | VIKINGS | $ | $ | % | $ | $ | DEFAULT JUDGEMENT | |||||||||||||||||||
| ST. LOUIS PARK, MN | EXCELSIOR | $ | $ | % | $ | $ | DEFAULT JUDGEMENT | |||||||||||||||||||
| ST. PAUL, MN | CONTINENTAL 560 | $ | $ | % | $ | $ | DEFAULT JUDGEMENT | |||||||||||||||||||
| MAPLE GROVE, MN | BUTTNICK | $ | $ | % | $ | $ | SETTLEMENT AGREEMENT | |||||||||||||||||||
| DENVER, CO | RADIANT | $ | $ | $ | DISMISSED | |||||||||||||||||||||
| DENVER, CO | QUINCY(1) | $ | $ | % | $ | DEFAULT JUDGEMENT | ||||||||||||||||||||
| TOTAL | $ | $ | $ | $ | ||||||||||||||||||||||
Note 17: Subsequent Events
Series X Preferred Stock dividend payments for Q4 FY2025
In January 2026, the Company has issued a total
of
Series A Preferred Stock redemptions for Q4 FY2025
In January 2026, the Company issued a total of
In April 2026, the Company issued a total of
F-Issuances related to consultants
In January 2026, The Company has issued
Bridge Notes
On February 20, 2026, the Company entered into
a third Senior Secured
On April 10, 2026 the Company entered into a
F-25
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None
ITEM 9A. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures” as such term is defined in Rule 13a-15(e) under the Securities Exchange. In designing and evaluating our disclosure controls and procedures, our management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management was required to apply its judgment in evaluating the cost-benefit relationship of disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Based on their evaluation as of the end of the period covered by this Annual Report, the Board has determined these were deemed not effective and has undertaken to address the shortcomings by:
| a. | adding additional and more qualified staff; |
| b. | reviewing structure and procedures implemented by similarly situated publicly held companies; and |
| c. | changes in process prior to any further acquisition or financing activity. |
Management’s Annual Report on Internal Control over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. In making this assessment, management used the criteria set forth by the committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control – Integrated Framework (2013 Framework). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles accepted in the United States of America. Internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the interim or annual financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.
The Company’s management notes that the Company’s internal control over financial reporting was not effective as of December 31, 2025.
A material weakness is 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 the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
The material weaknesses identified during our annual audit for 2025 were (i) lack of formal documentation of policies and procedures, (ii) lack of segregation of duties and multiple levels of review, and (iii) lack of sufficient resources with appropriate accounting experience, especially with regards to equity-based transactions and tax accounting expertise.
Because of these material weaknesses, management concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2025. This Annual Report does not include an attestation report of our registered public accounting firm regarding our internal controls over financial reporting. The disclosure contained under this Item 9A was not subject to attestation by our registered public accounting firm pursuant to the temporary rules of the SEC that permit us to provide only with the disclosure under this Item 9A in this annual report.
We believe that the material weaknesses as reported will eventually be fully remediated, upon being properly capitalized to hire the proper personnel for segregation of duties and SEC and GAAP accounting knowledge.
27
Management’s Report on Disclosure Controls and Procedures
The Company’s management has identified what it believes are material weaknesses in the Company’s disclosure controls and procedures.
The deficiencies in our disclosure controls and procedures included (i) lack of segregation of duties and (ii) lack of sufficient resources to ensure that information required to be disclosed by the Company in the reports that the Company files or submits to the SEC are recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms.
The Company intends to take corrective action to ensure that information required to be disclosed by the Company pursuant to the reports that the Company files or submits to the SEC is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Cybersecurity
We utilize information technology for internal and external communications with vendors, clinical sites, banks, investors and shareholders. Loss, disruption or compromise of these systems could significantly impact operations and results.
We are not aware of any material cybersecurity violation or occurrence. We believe our efforts toward prevention of such violation or occurrence, including system design and controls, processes and procedures, training and monitoring of system access, but may not prevent unauthorized access to our systems.
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during our fourth quarter ended December 31, 2025 that has materially affected, or is likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
None.
28
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
CURRENT BOARD OF DIRECTORS AND MANAGEMENT
The following table and biographical summaries set forth information, including principal occupation and business experience about our directors and executive officers as of December 31, 2025:
Board of Directors
| Name | Position | Age | Date Appointed | Date Resigned | |||||
| Current Board | |||||||||
| Mack Leath | Chief Executive Officer, Chief Financial Officer, Chairman of the Board, Director | 69 | 12/15/2023 | in place | |||||
| Jim Clifton | Independent Director | 52 | 05/26/2025 | 03/09/2026 | |||||
| Dr. Jordan Balencic | Independent Director | 40 | 12/15/2023 | in place |
Current Board and Management
Mr. Mack Leath, age 69, is a Director who also serves as CEO, CFO and Chairman of the Board of Directors. He is a senior executive with 30 + years’ experience in business management, including a number of rapid growth and start-up situations. He has been a sales and marketing professional in Petro-chemical distribution, software and construction related products as well as healthcare. His roles include financial management and capital markets. He has previously served on the Board of the Company from September 2016 until May 2017 where he assisted in restructuring and evaluating various business situations.
Mr. Leath has held several positions with several software companies. He is the founder and Vice President of Business Development for Araicom Life Sciences, a literature search software start-up, Medsoftccs, LLC a software solution focused on assisting HR functions with nursing compliance issues and represents WVI Enterprise Companion, a software operating environment for the petro-chemical industries. His involvement with each organization has varied with his primary focus being development and implementation of the business plans, raising investment capital (angel), marketing and sales. Most recently, Mr. Leath is a partner in CLRM which assesses GHG’s to trade in environmental carbon credit market and assists in improving fuel economies and emissions for long haul trucks.
Mr. Leath has been the past president and has continued to serve on the Board of Searstone (www.searstone.com), a $150 million Continuing Care Retirement Community in Cary, NC since its inception in 2005, construction and occupancy. As president, he presented and argued the business case before the North Carolina MedCare Commission for the $112 million bond financing in 2010. In conjunction with this role, he has served as president of Quality Care Foundation, a 501c(3) corporation since 2002 which is the bond holder for other assisted care living facilities and CCRCs.
Mr. Leath graduated from North Carolina State University with a B.S. in Business Administration; 1986.
Dr. Jordan Balencic, age 40, is a Director. His employment history includes positions in both the healthcare arena, and as an entrepreneur. His healthcare experience is as follows: From October 2016 until the present, he has served as the Service Chief, Medical Director, and a staff physician for Home Based Primary Care (HBPC) November for the U.S. Department of Veterans Affairs, Veterans Health Administration Lebanon, PA (Lebanon VA Medical Center).
His experience as an entrepreneur includes CEO / Co-Founder of ERApeutics, LLC d/b/a EVERMIND, Lancaster, PA, a physician-led organization dedicated to commercializing evidence-based, functional food and beverage products for cognitive health. From August 2017 until the present, he serves as CEO / Co-Founder for BrainPower Capital, Inc., Lancaster, PA a health and wellness commercialization consultancy that has provided strategic guidance to several startups and public microcap companies since 2017.
He previously served as a member of the Board of Directors for Mitesco from September 2016 until September 2018 where he assisted in restructuring and evaluating various business acquisitions.
Dr. Balencic’s education includes the following degrees: Doctor of Osteopathic Medicine (D.O.), in June 2013 from Lake Erie College of Osteopathic Medicine, Erie, PA and Bachelor of Science (B.S.) in May 2009 from Gannon University, Erie, PA Degree: B.S. Biology with Emphasis in Pre-Medicine, Cum Lade.
Mr. James Clifton, age 52, is a Director. Jim Clifton is a senior sales and marketing executive focused on systems software, data analytics and innovative implementation to improve productivity across corporations and workforces worldwide. He also has business interests in the commercial and residential real estate area.
Clifton launched his technical career at VeriSign (later acquired by Symantec Corporation) from 2002 until 2011 where he served as a Strategic Account Manager, helping enterprise customers protect their online assets and intellectual property during a period of rapid digital transformation of the early 2000s. His responsibilities included data protection, compliance, and enterprise software sales. He then joined Citrix Systems, Inc., focused on key corporate systems as a Field Sales Manager from 2011 until 2014, driving adoption of virtualization and enterprise. During 2014 he joined StarMobile, Inc., in the role of Director of Sales & Business Development. He helped position the company as a pioneer in mobile app transformation, playing a pivotal role in building strategic partnerships and expanding market reach. In 2015 he joined Cumberland Group as a Senior Account Executive, where he advised Fortune 500 companies on modernizing their IT infrastructure, leveraging cloud and hybrid strategies to increase business agility and resilience.
He joined VMware, Inc. during 2019 as a Client Executive, managing enterprise relationships focused on digital transformation by delivering solutions across cloud, networking, and security helping IT Operations and Application Development to become strategic enablers for the business. Most recently, beginning 2022 he joined Alteryx, Inc., as a Strategic Account Executive, helping organizations harness the power of data science, artificial intelligence, and machine learning. He empowered business leaders to make smarter, faster decisions by promoting democratized access to advanced analytics and automation to all within the enterprise.
Jim’s education includes a Bachelor’s degree from the University of Georgia in 1990 and a Master’s degree from Mercer University in 2007. He is based in St. Simons, Georgia.
29
Arrangements for Nomination as Directors and Changes in Procedures for Nomination; Election of Directors
No arrangement or understanding exists between any director or nominee and any other persons pursuant to which any individual was or is to be selected or serve as a director. No director or executive officer has any family relationship with any other director or with any of the Company’s executive officers. Holders of our Common Stock are entitled to one vote for each share held on all matters submitted to a vote of the stockholders, including the election of directors. Cumulative voting with respect to the election of directors is not permitted by our Certificate of Incorporation. Our Board of Directors shall be elected at the annual meeting of the shareholders or at a special meeting called for that purpose. Each director shall hold office until the next annual meeting of shareholders and until the director’s successor is elected and qualified.
Composition of our Board of Directors
Our board of directors currently consists of three (3) members. Our directors hold office until their successors have been elected and qualified or until the earlier of their death, resignation, or removal.
Director Independence
While the Company’s shares are not listed on the NASDAQ Capital Market, the Company has chosen to implement NASDAQ’s independence standards to determine the independence of our board of directors. Accordingly, Dr. Jordan Balencic is currently the only independent board member in accordance with NASDAQ independence standards. Our Board determined that Mr. Leath and Mr. Mitchell, are not independent directors as a result of being an executive officer to the Company.
Board of Directors Committees
The Company currently has audit and compensation committees of the board of directors. The Company may elect to may create additional Board committees when it applies to an up-listing to a senior exchange.
Audit Committee
The Company has appointed Dr. Balencic as the sole member of the audit committee. Dr. Balencic is independent under the Nasdaq Listing Rules independence standards. Our audit committee is comprised of one independent board member. The audit committee is responsible for overseeing our corporate accounting and financial reporting process, assisting our board of directors in monitoring our financial systems, and overseeing legal, healthcare, and regulatory compliance. Our audit committee also:
| ● | selects and hires the independent registered public accounting firm to audit our financial statements; | |
| ● | helps to ensure the independence and performance of the independent registered public accounting firm; |
| ● | approves audit and non-audit services and fees; |
| ● | reviews financial statements and discusses with management and the independent registered public accounting firm our annual audited and quarterly financial statements, the results of the independent audit and the quarterly reviews and the reports and certifications regarding internal controls over financial reporting and disclosure controls; |
| ● | prepares the audit committee report that the SEC requires to be included in our annual proxy statement; |
| ● | reviews reports and communications from the independent registered public accounting firm; |
| ● | reviews the adequacy and effectiveness of our internal controls and procedure; |
| ● | reviews our policies on risk assessment and risk management; |
| ● | reviews related party transactions; and |
| ● | establishes and oversees procedures for the receipt, retention and treatment of accounting related complaints and the confidential submission by our employees of concerns regarding questionable accounting or auditing matters. |
Our audit committee operates under a written charter, which satisfies the applicable rules of the SEC.
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Compensation Committee
Mr. Leath and Dr. Balencic currently serve as members of the compensation committee. Our compensation committee oversees our compensation policies, plans and benefits programs. The compensation committee also:
| ● | oversees our overall compensation policies, plans and benefit programs; | |
| ● | reviews and recommends to our board of directors for approval compensation for our executive officers and directors; | |
| ● | prepares the compensation committee report that the SEC would require to be included in our annual proxy statement if we were no longer deemed to be an emerging growth company or a smaller reporting company; and | |
| ● | administers our equity compensation plans. |
Our compensation committee operates under a written charter, which satisfies the applicable rules of the SEC.
Code of Ethics
We have adopted a Code of Business Conduct and Ethics, which applies to our Board of Directors, our executive officers, and our employees, and outlines the broad principles of ethical business conduct we adopted, covering subject areas such as:
| o | Compliance with applicable laws and regulations |
| o | Handling of books and records |
| o | Public disclosure reporting |
| o | Insider trading |
| o | Discrimination and harassment |
| o | Health and safety |
| o | Conflicts of interest |
| o | Competition and fair dealings |
| o | Protection of Company asset |
ITEM 11. EXECUTIVE COMPENSATION
Summary of Executive Compensation
The following summary compensation table sets forth all compensation awarded to, earned by, or paid to the named executive officers paid by us during the years ended December 31, 2025 and 2024.
| Salary | Salary | |||||||||||||||||||||||||||||||||||||||
| earned | earned | Non-Equity | Nonqualified | |||||||||||||||||||||||||||||||||||||
| and | and | Incentive | Deferred | All | ||||||||||||||||||||||||||||||||||||
| Name and | paid in | unpaid in | Stock | Option | Plan | Compensation | Other | |||||||||||||||||||||||||||||||||
| Principal | cash | cash | Bonus | Awards | Awards | Compensation | Earnings | Compensation | Total | |||||||||||||||||||||||||||||||
| Position | Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ||||||||||||||||||||||||||||||
| Mack Leath | 2025 | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
| Chief Executive Officer and Chief Financial Officer | 2024 | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Pension Benefits; Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans
We do not offer pension benefits, non-qualified contribution, or other deferred compensation plans to our executive officers.
Outstanding Equity Awards at December 31, 2025
In January 2024 the Board of Directors terminated the stock option plan, and all previously issued options. As a result, there are no outstanding options at this time.
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DIRECTOR COMPENSATION
The following table sets forth, for the years ended December 31, 2025 and 2024, information relating to the compensation of each director who served on our Board of Directors during the fiscal year and who was not a named executive officer. This compensation was for their role as Director of the Company within the fiscal year, as well as an issuance in consideration of their contributions outside of their role as a director.
| Year | CASH PAYMENTS |
SERIES X PREFERRED SHARES |
RESTRICTED COMMON STOCK PERFORMANCE AWARDS |
VALUE OF PERFORMANCE REWARD |
TOTAL COMPENSATION |
||||||||||||||||||||
| LEATH | 2025 | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||
| 2024 | $ | - | $ | 60,000 | 250,000 | $ | 75,000 | $ | 135,000 | ||||||||||||||||
| BALENCIC | 2025 | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||
| 2024 | $ | - | $ | 60,000 | $ | 250,000 | $ | 75,000 | $ | 135,000 | |||||||||||||||
| MITCHELL | 2025 | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||
| 2024 | $ | 28,000 | $ | 60,000 | $ | 250,000 | $ | 75,000 | $ | 163,000 | |||||||||||||||
| CLIFTON | 2025 | $ | - | $ | 60,000 | $ | - | $ | - | $ | 60,000 | ||||||||||||||
| 2024 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||
They have agreed to serve for one (1) year terms and have agreed to a compensation plan that provides for a) $60,000 per year stipend to be paid by the issuance of Series X Preferred Stock, and b) reimbursement of any real and actual cash expenses incurred in the execution of their responsibilities such as travel, office supplies or similar nominal expenses, c) potential performance awards using restricted common stock based on the performance of the Company in its restructuring and operations.
The Series X Preferred shares have a face value of $25 per share and pay dividends of 10% in cash or through the issuance of restricted common stock monthly. All dividends to date for previously issued shares have been paid through the issuance of restricted common stock, and it is anticipated that this practice will continue indefinitely.
For 2024, in conjunction with their appointments, each of the Directors will receive a total of 2,400 shares of Series X Preferred stock. Each share has voting rights entitling it to four hundred (400) votes, when compared to common stock which has one (1) vote per share. As such each director will be entitled to 960,000 share votes on any matter requiring a vote.
In July 2024 each of the Directors were issued 100,000 shares of restricted common stock in consideration of their contributions over and above their role as a member of the Board of Directors. The shares were valued at $.25 per share, and the Company recorded stock compensation of $5,000 for each issuance, $75,000 in aggregate, related to the issuance.
In November 2024 each of the Directors were issued 150,000 shares of restricted common stock in consideration of their contributions over and above their role as a member of the Board of Directors. The shares were valued at $.34 per share, $51,000 for each director, or $153,000 in total, per share, and the Company recorded stock compensation of $51,000 for each issuance, $153,000 in aggregate, related to the issuance.
During FY2024 the Directors also received 8,661 shares of restricted common stock in payment of dividends for the Series X Preferred shares, valued at $2,165 each. Mr. Mitchell was compensated with $28,000 in cash consideration for his time providing administrative support.
This brings the total compensation for each Director for FY2024 to $137,165, consisting of a) an annual stipend of $60,000 paid in the form of the issuance of 2,400 shares of Series X Preferred shares, and b) 250,000 shares of restricted common stock issued for services and performance outside of their Board responsibilities in two (2) separate issuances, one for the first half of FY2024 of 100,000 shares, and a second for the last half of FY2024 of 150,000 shares.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth certain information as of March 31, 2026, regarding the beneficial ownership of our Common Stock and Series X Preferred Stock by (i) each person (including any “group” as such term is used in Section 13(d)(3) of the Exchange Act) known by us to be a beneficial owner of more than 5% of our common stock, (ii) each of our directors and “named executive officers;” and (iii) all of our directors and executive officers as a group. At March 31, 2026, we had 15,625,116 shares of Common Stock issued and outstanding, and 42,103 shares of Series X Preferred Stock issued and outstanding, having an aggregate of 16,841,200 votes. Unless otherwise indicated, the address of each of the stockholders listed is 1660 Highway 100 South, Suite 432, Saint Louis Park, Minnesota 55416. Beneficial ownership is determined in accordance with the rules of the SEC and includes general voting power and/or investment power with respect to securities. Shares of Common Stock issuable upon exercise of options or warrants that are currently exercisable or exercisable within 60 days of the Record Date and shares of Common Stock issuable upon conversion of other securities currently convertible or convertible within 60 days, are deemed outstanding for computing the beneficial ownership percentage of the person holding such securities but are not deemed outstanding for computing the beneficial ownership percentage of any other person. Under the applicable SEC rules, each person’s beneficial ownership is calculated by dividing the total number of shares with respect to which they possess beneficial ownership by the total number of outstanding shares. In any case where an individual has beneficial ownership over securities that are not outstanding but are issuable upon the exercise of options or warrants or similar rights within the next 60 days, that same number of shares is added to the denominator in the calculation described above. Because the calculation of each person’s beneficial ownership set forth in the “Percentage Class” column of the table may include shares that are not presently outstanding, the sum total of the percentages set forth in such column may exceed 100%.
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| Common shares outstanding at March 31, 2026 | 17,853,264 | Preferred X shares outstanding at March 31, 2026 | 42,103 | Votes from Preferred X super voting: | 16,841,200 | Total voting shares including common and super votes from Preferred X | 34,694,464 | |||||||||||||||||||||||||
| Name | Amount and Nature of Beneficial Ownership of Common Stock | Percentage of Common Stock Beneficially Owned | Number of Shares of Series X Preferred Stock | Percentage of Series X Preferred Stock | Number of votes at 400 per share | Add common shares held at March 31, 2026 | Total Votes | % of the Total Votes | ||||||||||||||||||||||||
| MACK LEATH (1) (2) | 403,114 | 2.26 | % | 2,400 | 5.70 | % | 960,000 | 403,114 | 1,363,114 | 3.93 | % | |||||||||||||||||||||
| JORDAN BALENCIC (3) | 283,752 | 1.59 | % | 2,400 | 5.70 | % | 960,000 | 283,752 | 1,243,752 | 3.58 | % | |||||||||||||||||||||
| BRIAN VALANIA (3)(7) | 200,000 | 1.12 | % | - | - | % | - | 200,000 | 200,000 | 0.58 | % | |||||||||||||||||||||
| Current Executive Officers and Directors as a group (3 Persons) | 886,866 | 4.97 | % | 4,800 | 11.40 | % | 1,920,000 | 886,866 | 2,806,866 | 8.09 | % | |||||||||||||||||||||
| 5% or more shareholders | ||||||||||||||||||||||||||||||||
| JOHN MITCHELL (6) | 311,375 | 1.74 | % | 2,400 | 5.70 | % | 960,000 | 311,375 | 1,271,375 | 3.66 | % | |||||||||||||||||||||
| JIM CLIFTON (5) (6) | 261,728 | 1.47 | % | 2,400 | 5.70 | % | 960,000 | 261,728 | 1,221,728 | 3.52 | % | |||||||||||||||||||||
| ANGLO IRISH MANAGEMENT, LLC (4) | 343,530 | 1.92 | % | 32,503 | 77.20 | % | 13,001,200 | 343,530 | 13,344,730 | 38.46 | % | |||||||||||||||||||||
| Total of 5% or more | 916,633 | 5.13 | % | 37,303 | 88.60 | % | 14,921,200 | 916,633 | 15,837,833 | 45.65 | % |
Notes to the above table:
| (1) | includes 100,000 shares issued to a family member for acquisition of a software business |
| (2) | Mr. Leath is currently Chairman of the Board of Directors and former CEO and CFO |
| (3) | Mr. Balencic and Mr. Valania are currently members of the Board of Directors |
| (4) | Based solely on representation by Anglo Irish Management LLC (“Anglo”). Daniel Hollis is the Manager of Anglo-Irish Management LLC, and its business address is 9057A Selborne Lane, Chatt Hills, GA 30268. Anglo has held shares of Series X Preferred stock since 2019 and has recently acquired 20,000 additional shares for its contributions in the restructuring of the Company over the last 3 years. The shares have a face value of $25 each, and as such the issuance is valued at $500,000. No cash consideration was provided to the Company for the issuance. It has most recently held a number of shares equal to 26.97% of voting rights as previously disclosed, those shares having been issued in 2019 in consideration of accounts payable and consulting fees in the amount of $312,575. Its common stock holdings have come solely from the issuance of restricted common stock for the payment of dividends since 2019 and none of the shares are as a result of share purchases in the open market. There is no relationship between any of its members and the Board of Directors, or any member of management. The shares are held solely for investment purposes. |
| (5) | Mr. Clifton received 75,000 shares in FY2024 for his participation on the Advisory Board and 175,000 shares of restricted common stock for this role on the Board of Directors in FY2025. He also received $60,000 of Series X Preferred shares as consideration for his role on the Board of Directors. |
| (6) | Mr. Mitchell and Mr. Clifton are a former Director and is included in this table simply because he is the only other holder of Series X Preferred shares. | |
| (7) | Mr. Valania was appointed the CEO and CFO on March 9, 2025 |
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Item 13. Certain Relationships and Related Transactions, and Director Independence
Transactions with Related Persons
On April 24, 2025, the Company entered into an Obligation Exchange Agreement with Lindstrom whereby Lindstrom agreed to settle the above notes, accrued interest and other obligations in consideration of the issuance of 75,000 shares of restricted common stock for each of the holders. As a result of the exchange, which was accounted for as a troubled debt restricting, the Company recorded a gain on settlement of liabilities of $249,765.
During the year ended December 31, 2025, the Company issued 2,400 shares of Series X Preferred Stock to the newly elected director of the Company for compensation in lieu of services in the amount of $60,000.
No member of management has benefited from the transactions with related parties.
Policies and Procedures for Related-Party Transactions
Our Audit Committee considers and approves or disapproves any related person transaction as required by NASDAQ regulations.
Director Independence Standards
Applicable NASDAQ rules require a majority of a listed company’s board of directors to be comprised of independent directors. In addition, the NASDAQ rules require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees be independent and that audit committee members also satisfy independence criteria set forth in Rule 10A-3 under the Exchange Act. Under applicable NASDAQ rules, a director will only qualify as an “independent director” if, in the opinion of the listed company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee, accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries or otherwise be an affiliated person of the listed company or any of its subsidiaries.
Item 14. Principal Accountant Fees and Services
Astra Audit & Advisory, LLC (“Astra”) was our independent registered public accounting firm for our fiscal years ended December 31, 2025 and 2024. The aggregate fees billed for professional services by Astra during 2025 and 2024 were as follows:
Astra Audit & Advisory, LLC
| 2025 | 2024 | |||||||
| Audit Fees | $ | 112,500 | $ | 84,000 | ||||
| Audit-Related Fees | $ | 9,850 | - | |||||
| Tax Fees | - | - | ||||||
| All Other Fees | - | - | ||||||
Audit Fees are the aggregate fees billed during the years ended December 31, 2025 and 2024 for professional services rendered by Astra, for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s Form 10-Q or services that are normally in connection with statutory and regulatory filings or engagements.
Audit-Related Fees are the aggregate fees billed during the years ended December 31, 2025 and 2024 for assurance and related services rendered by Astra, that are reasonably related to the performance of the audit or review of the Company’s financial statements and are not reported under the category Audit Fees described above.
Tax Fees are the aggregate fees billed during the years ended December 31, 2025 and 2024 for tax compliance services rendered. No tax services were rendered by Astra.
All Other Fees are the aggregate fees billed during the years ended December 31, 2025 and 2024 for products and services provided by Astra, other than the services reported in the Audit Fees, Audit-Related Fees, and Tax Fees categories above.
Audit Committee Pre-Approval Policies.
All the services performed by Astra that are described above were pre-approved by the Company’s audit committee. The Audit Committee pre-approves all audit and permissible non-audit services on a case-by-case basis.
None of the hours expended on Astra’s engagement to audit the Company’s financial statements for the years ended December 31, 2025 and 2024 were attributed to work performed by persons other than Astra’s full-time, permanent employees.
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PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
| (a)(1) | The following financial statements are included in this Annual Report on Form 10-K for the fiscal years ended December 31, 2025, and 2024: | ||
| 1. | Report of Independent Registered Public Accounting Firm | F-2 | |
| 3. | Consolidated Balance Sheets as of December 31, 2025, and 2024 | F-3 | |
| 4. | Consolidated Statements of Operations for the years ended December 31, 2025, and 2024 | F-4 | |
| 5. | Consolidated Statements of Stockholders’ Deficit for the years ended December 31, 2025, and 2024 | F-5 | |
| 6. | Consolidated Statements of Cash Flows for the years ended December 31, 2025, and 2024 | F-6 | |
| 7. | Notes to Consolidated Financial Statements | F-8 | |
| (a)(2) | All financial statement schedules have been omitted as the required information is either inapplicable or included in the Consolidated Financial Statements or related notes. | ||
| (a)(3) | The exhibits set forth in the accompanying exhibit index below are either filed as part of this report or are incorporated herein by reference: | ||
Unless otherwise indicated, each of the following exhibits have been previously filed with the Securities and Exchange Commission by the Company under File No. 000-53601.
| Incorporated by | ||||||||||
| Exhibit | Reference | Filed or Furnished | ||||||||
| Number | Exhibit Description | Form | Exhibit | Filing Date | Herewith | |||||
| 3.1 | Certificate of Incorporation of Trunity Holdings, Inc., dated January 18, 2012. | 8-K | 10.1 | 1/31/2012 | ||||||
| 3.2 | Bylaws of Trunity Holdings, Inc., dated January 18, 2012. | 8-K | 10.2 | 1/31/2012 | ||||||
| 3.3 | Certificate of Ownership Merging between Trunity Holdings, Inc. and Brain Tree International, Inc. dated January 24, 2012. | 10-K | 3.3 | 4/16/2013 | ||||||
| 3.4 | Certificate of Designation of Series X Preferred Stock of Trunity Holdings, Inc., dated December 9, 2015. | 8-K | 3.1 | 12/15/2015 | ||||||
| 3.5 | Certificate of Amendment to the Certificate of Incorporation of Trunity Holdings, Inc., dated December 24, 2015. | 8-K | 3.1(i) | 1/06/2016 | ||||||
| 3.6 | Certificate of Designations of Series X Preferred Stock of True Nature Holding, Inc. | 8-K | 3.6 | 1/06/2020 | ||||||
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| 21.1 | Subsidiaries of the Registrant | X | ||||||||
| 31.1 | Certification by the Principal Executive Officer and Principal Financial Officer of the Registrant pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | ||||||||
| 32.1 | Certification by the Principal Executive Officer and Principal Financial Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | X | ||||||||
| 101.INS | Inline XBRL Instance Document | X | ||||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | X | ||||||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X | ||||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | X | ||||||||
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | X | ||||||||
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | X | ||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
| * | Management contract or compensatory plan or arrangement required to be identified pursuant to Item 15(a)(3) of this report. |
ITEM 16. FORM 10-K SUMMARY
Not applicable.
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SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Annual Report on Form 10-K for the fiscal year ended December 31, 2025, to be signed on its behalf by the undersigned, thereunto duly authorized.
| MITESCO, INC. | ||
| Dated: April 15, 2026 | By: | /s/ Brian Valania |
|
Brian Valania Chief Executive Officer and Chief Financial Officer | ||
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed by the following persons on behalf of the Registrant, Mitesco, Inc., and in the capacities and on the dates indicated.
| Signature and Title | Date | |||
| /s/ Mack Leath | April 15, 2026 | |||
| Mack Leath | ||||
| Chairperson of the Board of Directors | ||||
| /s/ Brian Valania | April 15, 2026 | |||
| Brian Valania | ||||
| Chief Executive Officer, Chief Financial Officer and Secretary and Director | ||||
| /s/ Dr. Jordan Balencic | April 15, 2026 | |||
| Jordan Balencic | ||||
| Director |
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