Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Stemtech's actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include but are not limited to those discussed below and elsewhere in this annual report. Stemtech's audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

Company Overview

Globe Net Wireless Corp was incorporated in the State of Nevada, USA on September 4, 2009 with ticker symbol "GNTW". On August 19, 2021, Stemtech Corporation ("Stemtech"), a (Delaware corporation), entered into a Merger Agreement (the "Merger Agreement") with Globe Net Wireless Corp. ("Globe Net" or "GNTW") in exchange for the issuance of 37,060,000 shares of the Company, approximately 85% of the issued and outstanding shares of the Company. Our corporate name was changed to Stemtech Corporation in the state of Nevada in August 2021. On November 19, 2021, the Company adopted an Amendment to its Articles changing the name of the Corporation to Stemtech Corporation in the state of Nevada, and on April 14, 2022, FINRA gave final approval for said name change. Stemtech has pioneered and patented a whole new category of stem cell dietary supplements.

Stemtech's patented, advanced Stem Cell Nutrition formulations are one-of-a-kind natural products designed to help support the three most important aspects of stem cell physiology found in our RCM System: 1) Releasing the body's own stem cells slowing down the bodies aging process; 2) their Circulation in the blood; and 3) Migration into tissues, where they can perform their daily anti-aging and longevity function of renewal and rejuvenation for optimal health. We harness the incredible power of adult stem cells. How does this work? Adult stem cells are released from your body's own bone marrow into the bloodstream, they then circulate in the bloodstream and flow into the tissues and organs most in need. As they arrive, the adult stem cells migrate into the tissues, reproduce and become new, healthy cells of those tissues. This process takes place every single day, even without tissue damage, as part of the natural renewal system of the body. It is important to understand that Stemtech's patented products do not contain stem cells. They are composed of all-natural plant-based botanicals and other ingredients that have been clinically documented to support the release and performance of your own adult stem cells essentially allowing the human body to heal itself naturally. Stemtech also offers our all-natural OraStem^® toothpaste, which is a tooth whitener, breath freshener, anti-microbial, stem cell attracting and promotes good gum health. OraStem prevents bacteria from further entering the body and spreading germs to vital organs.

In December 2022, our new Cellect One^® Rapid Renew Stem Cell Peptide Night Cream. The Night Cream is a Stemtech proprietary formula containing an FDA patented ingredient, Red Oak Bark, which enables deep penetration to promote good skin health. In 2025, we introduced Cellect One^® Shield: HOCL (Hypochlorous Acid) skin care mist, which supports healthier skin, kills germs as a disinfectant, supports wound care and odor elimination. Stemtech announced it will introduce StemPets™, a pet supplement like our RCM for humans to our furry family members in April 2025. The global pet industry is a $303 Billion market.

While sales of products obviously create the cash flow, our real business model is not just "sales", but lateral penetration. We do this through our IBPs - "Independent Business Partners" Sales Force, and we invest much energy in growing our IBPs. Post funding, Stemtech is projecting the addition of 30,000 new independent business partner reps over the next 12 to 24 months, adding to the existing IBPs. IBPs are incentivized to build their network, attracting additional industry leaders. IBPs are a testimonial to our product and business model, lowering our customer acquisition costs. Our IBPs offer highly flexible yet steady income which is most adapted to todays "Laptop & Cellphone Lifestyle", with structured and organized weekly Corporate training calls, a personalized website, back-office tracking, oversight and management Tools, Reports, Training Materials and Social Sharing. Management conservatively believes we can reinvigorate sales to be more consistent with the company's previous revenue historically, as Stemtech has been recognized 4 times in the Inc 5000 Magazine's list of fastest growing companies. Below this IBP level, we plan to have our "DTC" (Direct To Consumer) network marketing Distribution model. This integrative model allows us an immediate global presence and ability to operate in multiple countries on every continent. With a 10% money back guarantee, This method requires no up-front or required buy-in of inventory by customers, with monthly shipments available for known recurring sales. This platform has us now operating at the intersection of the ecommerce economy, social economy and gig economy.

Implications of Being an Emerging Growth Company

Emerging Growth Company - We are an emerging growth company as defined in Section 2(a)(19) of the Securities Act of 1933, as amended, or the Securities Act. We will continue to be an emerging growth company until: (i) the last day of our fiscal year during which we had total annual gross revenues of at least $1.07 billion; (ii) the last day of our fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act; (iii) the date on which we have, during the previous 3-year period, issued more than $1.0 billion in non-convertible debt; or (iv) the date on which we are deemed to be a large accelerated filer, as defined in Section 12b-2 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30.

As an emerging growth company, we are exempt from:

	·	Sections 14A(a) and (b) of the Exchange Act, which require companies to hold stockholder advisory votes on executive compensation and golden parachute compensation;
	·	The requirement to provide, in any registration statement, periodic report or other report to be filed with the SEC certain modified executive compensation disclosure under Item 402 of Regulation S-K or selected financial data under Item 301 of Regulation S-K for any period before the earliest audited period presented in our initial registration statement;
	·	Compliance with new or revised accounting standards until those standards are applicable to private companies;
	·	The requirement under Section 404(b) of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, to provide auditor attestation of our internal controls and procedures; and
	·	Any Public Company Accounting Oversight Board, or "PCAOB", rules regarding mandatory audit firm rotation or an expanded auditor report, and any other PCAOB rules subsequently adopted unless the Commission determines the new rules are necessary for protecting the public.

We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the Jumpstart Our Business Startups Act.

We are also a smaller reporting company as defined in Rule 12b-2 of the Exchange Act. As a smaller reporting company, we are not required to provide selected financial data pursuant to Item 301 of Regulation S-K, nor are we required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002. We are also permitted to provide certain modified executive compensation disclosure under Item 402 of Regulation S-K.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP. Such consolidated financial statements and accompanying notes are the representations of the Company's management, which is responsible for their integrity and objectivity. All intercompany accounts and transactions have been eliminated in consolidation.

Critical Accounting Policies

This Management's Discussion and Analysis of Financial Condition and Results of Operations discusses our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. In connection with the preparation of our consolidated financial statements, we are required to make assumptions and estimates about future events and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presented fairly and in accordance with U.S. GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Our significant accounting policies are discussed in Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included elsewhere in this report.

Critical Accounting Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. Our most critical accounting estimates include: (i) Going Concern Assessment - judgment regarding future revenue recovery and ability to raise capital; (ii) Goodwill and Intangible Asset Impairment - estimation of future cash flows to support carrying values of $467,409 goodwill and $2,208,663 intangible assets; and (iii) Fair Value of Convertible Debentures - assessment of bifurcation criteria and fair value measurement under ASC 815. The preparation of our consolidated financial statements and related disclosures requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities and expenses and related disclosures. Management believes that there are no critical accounting estimates in these consolidated financial statements.

New Accounting Pronouncements

We do not expect recent accounting pronouncements will have a material impact on our consolidated financial position, results of operations or cash flows. See Note 2 in the accompanying consolidated financial statements for additional information.

Results of Operations

Our consolidated financial statements have been prepared assuming that we will continue as a going concern. Accordingly, the accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or liabilities that may be necessary should we be unable to continue operations. We expect to require additional capital to support our long-term operating requirements and may seek to raise such capital through the issuance of equity or debt securities, among other financing alternatives.

Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024.

Net sales for the year ended December 31, 2025 were $2,876,380, compared to $5,053,690 for the year ended December 31, 2024, representing a decrease of $2,177,310. The decline in net sales was primarily attributable to the stock-outs and supply disruptions on specific high-demand product lines during the year. While the Company maintained a positive inventory balance of $217,338 at year-end (above the prior year balance of $197,355), certain key products were unavailable for distributor fulfilment during significant portions of FY2025. This supply disruption was compounded by working capital constraints that limited the frequency and volume of replenishment purchase orders.

Total operating expenses decreased to $5,018,487 for the year ended December 31, 2025 from $6,113,773 for the year ended December 31, 2024, a reduction of $1,095,286. The decrease was primarily driven by lower operating activity associated with reduced revenues.

Total other expense, net, was $1,340,793 for the year ended December 31, 2025, compared to $1,386,274 for the prior year. Interest expense decreased to $1,452,150 in 2025 from $1,579,370 in 2024, primarily reflecting lower financing costs and improved debt management activities. During 2024, the Company recognized a gain on extinguishment of debt of $107,733, while no comparable gain was recognized in 2025. Other income and expense, net, increased to $111,357 in 2025 from $85,363 in 2024.

As a result of the foregoing, net loss for the year ended December 31, 2025 was $4,049,840 compared to a net loss of $3,772,701 for the year ended December 31, 2024. The increase in net loss was primarily attributable to lower revenue, continued fixed operating expenses, and the absence of the gain on extinguishment of debt recognized during the prior year, partially offset by lower interest expense.

Liquidity and Capital Resources

We have not yet achieved profitability and cannot provide assurance as to when, or if, we will become profitable. We incurred net losses of $4,049,840 and $3,772,701 for the years ended December 31, 2025 and 2024, respectively.

During the year ended December 31, 2025, we funded our short-term liquidity requirements primarily through existing cash balances and financing activities. Financing sources during the year included proceeds from notes payable of $290,553 and net proceeds from factoring arrangements of $169,457. As a result, net cash provided by financing activities totaled $460,010 for the year ended December 31, 2025.

As of December 31, 2025, current assets were $457,062, compared to $921,746 as of December 31, 2024. The decrease in current assets was primarily attributable to the elimination of accounts receivable and a significant reduction in prepaid expenses, partially offset by a modest increase in inventory.

Current liabilities increased to $10,854,013 as of December 31, 2025 from $9,009,049 as of December 31, 2024. The increase was primarily attributable to higher accounts payable, notes payable, and factoring obligations incurred to support operations and liquidity needs.

Current liabilities as of December 31, 2025 consisted primarily of $5,677,261 in accounts payable and accrued expenses, $2,336,554 in notes payable, $1,825,645 in convertible debentures, $843,068 in factoring liabilities, and $171,485 in deferred revenue.

Stockholders' deficit increased to $7,704,399 as of December 31, 2025 from $5,226,804 as of December 31, 2024. The increase in stockholders' deficit was primarily attributable to the net loss incurred during the year, partially offset by increases in additional paid-in capital related to equity issuances and debt conversions.

Cash Flows from Operating Activities

We have not generated positive cash flows from operating activities. For the year ended December 31, 2025, net cash used in operating activities was $483,583, primarily attributable to a net loss of $4,049,840, partially offset by non-cash charges and favorable changes in working capital.

Non-cash adjustments primarily consisted of stock issued for services of $1,126,671, stock-based compensation expense of $439,054, depreciation and amortization expense of $167,495, and amortization of debt discount of $56,062.

Changes in operating assets and liabilities primarily included an increase in accounts payable and accrued expenses of $1,158,870, an increase in prepaid expenses and other current assets of $197,865, an increase in deferred revenues of $170,022, a decrease in accounts receivable of $269,749, a decrease in inventory of $19,983, and an increase in long-term deposits of $452.

Cash Flows from Financing Activities

We have historically financed our operations primarily through debt financing, factoring arrangements, and the issuance of equity securities. For the year ended December 31, 2025, net cash provided by financing activities was $460,010.

Financing activities during the year primarily consisted of $290,553 in proceeds from notes payable and $169,457 in net proceeds from factoring arrangements.

Plan of Operation and Funding

The Company expects to fund its operations over the next twelve months primarily through: (i) the Leviston Resources, LLC senior secured convertible facility (up to $7.0 million aggregate, of which approximately $1.56 million had been funded as of December 31, 2025 - note that funding is at the lender's sole discretion and the Company cannot guarantee that additional draws will be made available); (ii) continued issuances of equity securities including shares issued pursuant to convertible note conversion agreements; (iii) short-term director loans as a supplemental liquidity backstop; and (iv) proceeds from the factoring arrangement. Investors should note that reliance on the Leviston facility represents a significant risk factor, as the lender retains full discretion over future funding. There is no assurance that the remaining facility capacity will be made available to the Company.

In April 2026, the Company secured financing to support the production of approximately $2.5 million of inventory intended to improve product availability and support anticipated customer demand. Post-Balance Sheet Equity Issuances: Between January 1, 2026 and March 31, 2026, the Company issued 1,223,835,979 shares of common stock, bringing total shares outstanding to 1,649,816,690 as of March 31, 2026, as verified by the Company's transfer agent Empire Stock Transfer. These issuances were comprised entirely of conversions of outstanding convertible debt obligations by SOHO FO LLC and 1800 Diagonal Lending LLC pursuant to the terms of existing convertible note agreements; no cash proceeds were received by the Company. As of May 26, 2026, total shares outstanding were 2,067,960,034. The continued conversion of convertible debt into equity results in significant dilution to existing stockholders.

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next twelve months. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities and director loans. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations. We will have to raise additional funds in the next twelve months in order to sustain and expand our operations. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We have and will continue to seek to obtain short-term loans from our directors, although no future arrangement for additional loans has been made. We do not have any agreements with our directors concerning these loans. We do not have any arrangements in place for any future equity financing.

Off-Balance Sheet Arrangements

As of the date of this report, we do not have any off-balance sheet arrangements that have or are reasonably 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 investors.

Stockholders' Deficit

Authorized Shares

Effective 2025, the Company is authorized to issue up to 1,500,000,000 shares of common stock, $0.001 par value. Prior to May 5, 2023, the Company was authorized to issue up to 200,000,000 shares (see Note 9). Each outstanding share of common stock entitles the holder to one vote per share on all matters submitted to a stockholder vote. All shares of common stock are non-assessable and non-cumulative, with no pre-emptive rights.

Commitments and Contingencies

None.

Financing

On March 27, 2023, the Company entered into a Senior Secured Convertible Promissory Note with Leviston Resources, LLC providing for borrowings of up to an aggregate principal amount of $7,000,000, subject to funding at the lender's discretion. As of December 31, 2025, Leviston Resources, LLC had funded four tranches totaling $1,561,660, consisting of advances of $1,000,000, $250,000, $250,000, and $61,660, respectively. The remaining $5.4 million funding is at the lender's sole discretion and the Company cannot guarantee that additional draws will be made available.

The note bears interest at a rate of 7% per annum and is convertible into shares of the Company's common stock at a conversion price initially equal to 125% of the closing bid price of the Company's common stock on the applicable funding date, subject to certain adjustments as provided in the agreement.

We anticipate that additional capital may be required to fund future operations and support business growth initiatives. Any future equity financings may be dilutive to existing stockholders, and newly issued securities may provide for rights, preferences, or privileges senior to those of existing stockholders. In addition, future financing arrangements may include the issuance of convertible securities, warrants, or other equity-linked instruments that could result in further dilution.

The Company may incur significant expenses in connection with future financing transactions, including legal, accounting, and advisory fees. Certain financing instruments, such as convertible debt and warrants, may also result in the recognition of substantial non-cash expenses.

Our ability to obtain additional financing will depend on a number of factors, including market conditions, investor demand, our operating performance, and conditions within our industry. There can be no assurance that additional financing will be available on acceptable terms, or at all. If adequate capital is not available when needed, the Company may be required to reduce, delay, or suspend certain operating and strategic initiatives.