Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

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

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q, as well as the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the "Annual Report"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks, uncertainties and assumptions. You should read the sections titled "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in this Quarterly Report on Form 10-Q and in our Annual Report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this report-including statements regarding our strategy (including our digital-asset treasury strategy and related blockchain/tokenization initiatives), future financial condition, liquidity and capital resources, future operations, projected revenues, earnings (losses), margins, cash flows, business prospects, potential acquisitions and integration, and plans and objectives of management-are forward-looking statements.

Words such as "anticipates," "believes," "could," "estimates," "expects," "forecasts," "guidance," "intends," "may," "might," "outlook," "plans," "potential," "predicts," "projects," "seeks," "should," "targets," "will," "would," and similar expressions (and negative forms of such words) are intended to identify forward-looking statements. These statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially, including, but not limited to:

	●	our need to raise additional capital, which may not be available on acceptable terms or at all;
	●	our ability to maintain the listing of our common stock and warrants on the Nasdaq Capital Market;
	●	volatility in the price of our securities due to changes in the capital markets, our industry, or our capital structure;
	●	our ability to execute on our acquisition strategy and integrate acquired businesses successfully;
	●	our ability to retain key personnel and effectively manage growth;
	●	the risk that we and our agency partners are unable to generate expected revenues or margins;
	●	risks associated with the insurance brokerage industry, including carrier concentration, regulation, competition, and cyclicality;
	●	the impact of economic conditions, inflation, and interest rate trends on our operations and customer demand;
	●	potential disruptions due to cybersecurity incidents or system failures;
	●	risks associated with legal proceedings and compliance obligations;
	●	risks specific to our digital-asset treasury strategy; and
	●	other risks and uncertainties described in this Quarterly Report on Form 10-Q (including under "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations") and in our other filings with the Securities and Exchange Commission.

Forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required by applicable law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements are expressly qualified in their entirety by this cautionary note.

Overview

Reliance Global Group, Inc. (the "Company") operates as a company engaging in business in the insurance market. Our focus is to grow the Company by pursuing an aggressive acquisition strategy, initially and primarily focused upon wholesale and retail insurance agencies.

In the insurance sector, our management has extensive experience acquiring and managing insurance portfolios in several states, as well as developing specialized programs targeting niche markets. Our primary strategy is to identify specific risk to reward arbitrage opportunities and develop these on a national platform, thereby increasing revenues and returns, and then identify and acquire undervalued wholesale and retail insurance agencies with operations in growing or underserved segments, expand and optimize their operations, and achieve asset value appreciation while generating interim cash flows.

As part of our growth and acquisition strategy, we continue to survey the current insurance market for value-add acquisition opportunities. As of September 30, 2025, we had acquired nine insurance agencies.

Over the next 12 months, we plan to focus on the expansion and growth of our business through continued asset acquisitions in insurance markets and organic growth of our current insurance operations through geographic expansion and market share growth, as well as continuing to grow and execute on our Digital Asset Treasury Initiative, integrating blockchain technology into our long-term capital appreciation model.

In addition we plan to continue to expand into the digital asset and blockchain sector hereby building our portfolio comprising of cryptocurrencies, subject to market and other conditions.

Further, we launched our 5MinuteInsure.com ("5MI") Insurtech platform during 2021, which expanded our national footprint. 5MI is a high-tech proprietary tool developed by us as a business to consumer portal which enables consumers to instantly compare quotes from multiple carriers and purchase their car and home insurance in a time efficient and effective manner. 5MI taps into the growing number of online shoppers and utilizes advanced artificial intelligence and data mining techniques, to provide competitive insurance quotes in around 5 minutes with minimal data input needed from the consumer. The platform currently operates in 46 states offering coverage with up to 30 highly rated insurance carriers.

With the acquisition of Barra & Associates, LLC, we launched RELI Exchange, our business-to-business ("B2B") InsurTech platform and agency partner network that builds on the artificial intelligence and data mining backbone of 5MinuteInsure.com. Through RELI Exchange we on-board agency partners and provide them with an InsurTech platform white labeled, designed and branded specifically for their business. This combines the best of digital and human capabilities by providing our agency partners and their customers quotes from multiple carriers within minutes. Since its inception, RELI Exchange has increased its agent roster by more than 300%.

During the third quarter of 2025, the Company's Board of Directors approved a strategic expansion into the digital asset and blockchain sector. As part of this initiative, the Company initially plans to build a diversified portfolio comprising leading cryptocurrencies, such as Bitcoin, Ethereum, and Solana, to be managed by the Company's newly formed Crypto Advisory Board ("CAB"), and subject to market and other conditions. This initiative builds on Reliance's extensive experience at the intersection of insurance, fintech, and artificial intelligence, including the success of the Company's proprietary RELI Exchange platform. Reliance is additionally exploring opportunities to tokenize insurance-linked assets in ways not previously accessible to institutional and other investors. The Company believes this innovation could open the door to a new investment class that has historically been unavailable, bringing greater transparency, liquidity, and efficiency to the insurance-linked marketplace.

Business Operations

We've adopted a "OneFirm" strategy, pursuant to which Company owned and operated agencies come together to operate as one cohesive unit, which allows for efficient and effective cross-selling, cross-collaboration, and the effective deployment of the Company's human capital. This strategy also aims to enhance the Company's overall market presence across the U.S., with all business lines operating under the RELI Exchange brand. It's expected to benefit agents and clients by improving relationships with carriers, leading to better commission and bonus contracts due to higher business volumes. The approach also strengthens the capability of RELI Exchange agency partners in securing diverse insurance policies and fosters increased cross-selling opportunities. This unified strategy positions the Company for rapid scaling and integration of accretive acquisitions, expanding its industry reach.

Business Trends and Uncertainties

The insurance intermediary business is highly competitive, and we actively compete with numerous firms for customers and insurance companies, many of which have relationships with insurance companies, or have a significant presence in niche insurance markets that may give them an advantage over us. Other competitive concerns may include the quality of our products and services, our pricing and the ability of some of our customers to self-insure and the entrance of technology companies into the insurance intermediary business. Several insurance companies are engaged in the direct sale of insurance, primarily to individuals, and do not pay commissions to agents and brokers.

Insurance Operations

Our insurance operations focus on the acquisition and management of insurance agencies throughout the U.S. Our primary focus is to pinpoint undervalued wholesale and retail insurance agencies with operations in growing or underserved segments (including healthcare and Medicare, as well as personal and commercial insurance lines). We then focus on expanding their operations on a national platform and improving operational efficiencies to achieve asset value appreciation while generating interim cash flows. In the insurance sector, our management team has over 100 years of experience acquiring and managing insurance portfolios in several states, as well as developing specialized programs targeting niche markets. We plan to accomplish these objectives by acquiring wholesale and retail insurance agencies it deems to represent a good buying opportunity (as opposed to insurance carriers) as insurance agencies bear no insurance risk. Once acquired, we plan to develop them on a national platform to increase revenues and profits through a synergetic structure.

Insurance Acquisitions and Strategic Activities

As of September 30, 2025, we have acquired multiple insurance brokerages (see table below). As our acquisition strategy continues, our reach within the insurance arena can provide us with the ability to offer lower rates, which could boost our competitive position within the industry.

Acquired		Reliance 100% Controlled Entity		Date		Location		Line of Business
U.S. Benefits Alliance, LLC (USBA)		US Benefits Alliance, LLC		October 24, 2018		Michigan		Health Insurance
Employee Benefit Solutions, LLC (EBS)		Employee Benefits Solutions, LLC		October 24, 2018		Michigan		Health Insurance
Commercial Solutions of Insurance Agency, LLC (CCS or Commercial Solutions)		Commercial Coverage Solutions LLC		December 1, 2018		New Jersey		P&C - Trucking Industry
Southwestern Montana Insurance Center, Inc. (Southwestern Montana or Montana)		Southwestern Montana Insurance Center, LLC		April 1, 2019		Montana		Group Health Insurance
Fortman Insurance Agency, LLC (Fortman or Fortman Insurance)*		Fortman Insurance Services, LLC		May 1, 2019		Ohio		P&C and Health Insurance
Altruis Benefits Consultants, Inc. (Altruis)		Altruis Benefits Corporation		September 1, 2019		Michigan		Health Insurance
UIS Agency, LLC (UIS)		UIS Agency, LLC		August 17, 2020		New York		P&C - Trucking Industry
J.P. Kush and Associates, Inc. (Kush)		Kush Benefit Solutions, LLC		May 1, 2021		Michigan		Health Insurance
Barra & Associates, LLC		RELI Exchange, LLC		April 26, 2022		Illinois		P&C and Health Insurance

*This agency was sold by the Company during the third quarter of 2025.

Recent Developments

Digital Asset Treasury (DAT)

On September 9, 2025, the Board of Directors approved the adoption of a digital asset treasury strategy and a digital asset treasury policy. Under this strategy and policy, the Company may allocate a portion of its treasury funds to acquire cryptocurrencies, including leading digital assets such as Bitcoin, Ethereum and Solana, and may evaluate opportunities to tokenize insurance-linked assets.

In connection with the policy, the Board approved the formation of a Crypto Advisory Board (the "CAB") to manage, oversee and advise management and the Board on the ongoing development of the Company's digital-asset treasury strategy and related initiatives. The Board appointed Alex Blumenfrucht, an independent director, and Moshe Fishman, a senior vice president of the Company, as the initial members of the CAB.

On September 16, 2025, the Company entered into an Interim Crypto Purchase Agreement with Mr. Fishman, pursuant to which, solely as directed in writing by the CAB, Mr. Fishman could use his personal cryptocurrency trading accounts on an interim basis to facilitate purchases of digital assets on behalf of the Company while the Company completed opening its institutional cryptocurrency account. From the time of purchase, all right, title and interest in the digital assets belonged exclusively to the Company; the assets were held in Mr. Fishman's account solely for the Company's benefit. The Company agreed to reimburse Mr. Fishman for the actual purchase price and reasonable, documented transaction fees, and no compensation was payable to Mr. Fishman for services under the agreement. The agreement provided that all activities would be conducted in compliance with the Company's Insider Trading Policy and applicable law, and it terminated upon the earlier of (i) completion of the transfer of all such assets to the Company's institutional account or (ii) October 30, 2025 (unless extended by Audit Committee approval). The agreement terminated in accordance with its terms on October 30, 2025.

On September 17, 2025, the Company completed its initial purchase of Ethereum (ETH) under the DAT initiative. On September 29, 2025, the Company completed its first purchase of Bitcoin (BTC), following prior purchases of ETH and Cardano (ADA). On September 30, 2025, the Company completed a purchase of XRP, the native token of the XRP Ledger, as part of the DAT initiative. These digital assets purchased pursuant to the Interim Crypto Purchase Agreement are reflected in the Company's condensed consolidated balance sheets as digital assets owned by the Company with any related unearned gains or losses reflected in the condensed consolidated statements of operations for the three and nine month periods ended, September 30, 2025. During October 2025, the Company opened its institutional cryptocurrency account and Mr. Fishman transferred all digital assets purchased pursuant to the Interim Crypto Purchase Agreement to the Company's account.

Special Cash Dividend

On September 26, 2025, the Company's Board of Directors declared a one-time cash dividend of $0.03 per share on the Company's outstanding Common Stock, payable to shareholders of record as of October 30, 2025, with payment scheduled for December 2, 2025. As of September 30, 2025, the Company recorded a dividend payable of approximately $373,986, inclusive of approximately $92,000 payable to the Company's warrant holders entitled to receive dividends for their underlying warrant shares. Subsequent to quarter-end, the Company issued an additional 490,473 shares of Common Stock prior to the record date, which increased the total expected dividend payable to approximately $388,700. The additional shares represent a non-recognized subsequent event under ASC 855, Subsequent Events, and did not affect the amounts recorded as of September 30, 2025.

Equity Line of Credit (ELOC)

On August 26, 2025, the Company entered into a Common Stock Purchase Agreement (the "ELOC") and a related Registration Rights Agreement (together, the "White Lion Agreements") with White Lion Capital, LLC ("White Lion"). Under the Common Stock Purchase Agreement, the Company has the right, but not the obligation, to require White Lion to purchase, from time to time, up to $10,000,000 of newly issued shares of the Company's common stock, par value $0.086 per share, during a commitment period ending no later than December 31, 2027. Each sale is initiated by the Company through a written purchase notice, and the purchase price per share is equal to the lowest traded price of the common stock during a three-hour valuation period following White Lion's acknowledgment of the notice.

The agreement includes customary conditions and limitations, including a cap on the issuance of more than 19.99% of the Company's outstanding shares as of the execution date (the "Exchange Cap") unless stockholder approval is obtained or the average price paid for all shares issued equals or exceeds $0.9196, and a 4.99% beneficial-ownership limitation (which may be increased to 9.99% with 61 days' prior notice). In consideration for White Lion's commitment, the Company will issue $100,000 of fully earned common stock as commitment shares in two tranches payable during the third and fourth quarters of 2025. The Company has issued the first $50,000 tranche of shares as of September 30, 2025

Pursuant to the related Registration Rights Agreement, the Company agreed to file and maintain the effectiveness of a registration statement on Form S-1 covering the resale of the shares issuable under the White Lion Agreements, and the resale registration statement on Form S-1 the Company henceforth filed with the SEC was declared effective, September 4, 2025. Proceeds from sales under the facility, if and when made, may be used for general corporate purposes, including funding operations and purchases of digital assets pursuant to the Company's Digital Asset Treasury strategy.

Under the ELOC, as of September 30, 2025, the Company had issued 450,000 shares of Common Stock for net proceeds of approximately $350,000, after deducting a one-time documentation fee. Subsequent to quarter-end, the Company issued an additional 300,000 shares of Common Stock for proceeds of approximately $300,000, resulting in a remaining capacity of approximately $9.3 million under the ELOC as of the date of this report.

On November 5, 2025, we executed Amendment No. 1 to the Common Stock Purchase Agreement with White Lion Capital, LLC, which adds a Fixed Purchase Notice option. Under this feature, with investor consent, we may sell shares at a Fixed Purchase Price equal to 90% of the lowest traded price during the five-minute window immediately preceding delivery of the notice, up to a 5% ADTV limit per notice (unless waived). Closing and funding occur the next business day following notice consent, against DWAC delivery of the shares. See Item 5 and Exhibit 10.7 for additional information.

At-the-Market Offering Program

In August 2025, the Company entered into an At-the-Market ("ATM") Sales Agreement with H.C. Wainwright & Co., LLC, allowing the Company to offer and sell, from time to time through the Sales Agent, shares of its Common Stock having an aggregate offering price of up to $2,026,453 pursuant to its effective shelf registration statement on Form S-3 (File No. 333-275190). In September 2025, the Company filed Amendment No. 1 to the related prospectus supplement to update and refresh the amount of Common Stock then available for sale under the ATM Program to $248,138, consistent with the limitations imposed by General Instruction I.B.6 of Form S-3. During the three and nine months ended September 30, 2025, the Company sold 1,853,048 shares of Common Stock under the ATM Program, of which, 1,785,738 shares were issued as of September 30, 2025 and 67,310 shares were issued October 1, 2025, for net proceeds of approximately $2,021,681, after deducting sales commissions and offering expenses. Subsequent to September 30, 2025, the Company sold an additional 123,163 shares of Common Stock for net proceeds of approximately $119,764, and approximately $360 of Common Stock remained available for issuance thereafter. The Company intends to use any net proceeds from the ATM Program for general corporate purposes.

Private Placement

On June 18, 2025, the Company entered into a securities purchase agreement (the "Private Placement-2025") with one institutional buyer for the purchase and sale of, of (i) pre-funded warrants (the "Series J-PF Warrants") to purchase up to 1,488,096 shares of the Company's Common Stock at an exercise price of $0.001 per share, and (ii) warrants (the "Series J Warrants") to purchase up to 2,976,192 shares of Common Stock at an exercise price of $1.43 per share. The Private Placement-2025 was priced at the market at a combined purchase price per share and accompanying Series J Warrant of $1.68. Additionally, the Company issued a warrant to the Placement Agent (the "Series J PAW's"), to acquire 104,167 shares of Common Stock at an exercise price of $2.10. The closing of the Private Placement occurred on June 20, 2025. Series J-PF Warrants were fully exercised during the quarter ended September 30, 2025. All Series J-PF Warrants were exercised during the quarter ended September 30, 2025.

Fortman Sale

On July 7, 2025, the Company, Fortman Insurance Services, LLC, an Ohio limited liability company and wholly owned subsidiary of the Company (the "Seller", or "Fortman"), and Fortman Insurance Agency, LLC, an Ohio limited liability company (the "Purchaser"), entered into an Asset Purchase Agreement (the "Asset Purchase Agreement"), pursuant to which the Seller agreed to sell substantially all of the assets of its insurance agency business (the "Fortman Business") to the Purchaser for aggregate cash consideration of $5,000,000 (the "Transaction"). The Transaction closed on July 7, 2025, and was effective as of 12:01 a.m. Eastern Time on July 1, 2025. The sale did not represent a strategic shift that has or will have a major effect on the Company's operations or financial results. The Company recognized a gain on sale in the condensed consolidated statements of operations for the three and nine months ended September 30, 2025, of $3,033,554.

The assets sold pursuant to the Asset Purchase Agreement included the Seller's book of business, accounts, rights to renewal commissions and entitlements arising from new or renewal insurance business after July 1, 2025 (the "Effective Date"), as well as associated goodwill, leasehold interests, intellectual property (including the Fortman Insurance Services and Fortman Insurance Agency names), and other tangible and intangible assets used in the Fortman Business, and certain liabilities were assumed by the Purchaser. The Transaction excluded, among other things, Seller's pre-Effective Date cash and cash equivalents, and other specified excluded assets and liabilities.

Oak Street Debt Payments

During July 2025, the Company repaid approximately 50%, or $4,997,292 of its Oak Street long-term debt. These pre-payments were funded through proceeds from the asset sale of Fortman and did not incur any pre-payment penalties.

Termination of the Spetner Agreement

On July 22, 2025, the Company accepted written notice from Spetner Associates, Inc. ("Spetner"), terminating the Stock Exchange Agreement, dated as of May 14, 2024, and as amended on September 6, 2024, October 29, 2024, and February 20, 2025 (collectively, the "Stock Exchange Agreement"). There are no material relationships between the Company and the Spetner Parties other than in respect of the Stock Exchange Agreement.

On October 29, 2024, and February 20, 2025, the Company issued 140,064 shares and 157,000 shares of its common stock to the Spetner sellers, representing non-refundable prepayments of approximately $329,430 and $239,425, respectively, as partial consideration for the contemplated acquisition. These were initially recorded by the Company in the prepaid expense and other current assets account on the consolidated balance sheets as of December 31, 2024, and March 31, 2025, respectively. However, pursuant to the termination of the Stock Exchange Agreement, the Company does not expect to recover these shares issued and thus has expensed them to the general and administrative account in the condensed consolidated statements of operations for the period ended, September 30, 2025.

Non-GAAP Financial Measure

The Company believes certain financial measures which meet the definition of non-GAAP financial measures, as defined in Regulation G of the SEC rules, provide important supplemental information. Adjusted EBITDA ("AEBITDA"), our key financial performance metric, is a non-GAAP financial measure that is not in accordance with, or an alternative to, measures prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP"). "AEBITDA" is defined as earnings before interest, taxes, depreciation, and amortization (EBITDA) with additional adjustments as further outlined below. The Company considers AEBITDA an important financial metric because it provides a meaningful financial measure of the quality of the Company's operational, cash impacted and recurring earnings and operating performance across reporting periods. Other companies may calculate Adjusted EBITDA differently than we do, which might limit its usefulness as a comparative measure to other companies in the industry. AEBITDA is used by management in addition to and in conjunction (and not as a substitute) with the results presented in accordance with GAAP. Management uses AEBITDA to evaluate the Company's operational performance, including earnings across reporting periods and the merits for implementing cost-cutting measures. We have presented AEBITDA solely as supplemental disclosure because we believe it allows for a more complete analysis of results of operations and assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Consistent with Regulation G, a description of such information is provided below herein and tabular reconciliations of this supplemental non-GAAP financial information to our most comparable GAAP information are contained in this Quarterly Report on Form 10-Q under "Results of Operations".

We exclude the following items when calculating AEBITDA, and the following items define our non-GAAP financial measure AEBITDA:

	●	Interest and related party interest expense: Unrelated to core Company operations and excluded to provide more meaningful supplemental information regarding the Company's core operational performance.
	●	Depreciation and amortization: Non-cash charge, excluded to provide more meaningful supplemental information regarding the Company's core operational performance.
	●	Goodwill and/or asset impairments: Non-cash charge, excluded to provide more meaningful supplemental information regarding the Company's core operational performance.
	●	Equity-based compensation: Non-cash compensation provided to employees and service providers, excluded to provide more meaningful supplemental information regarding the Company's core cash impacted operational performance.
	●	Change in estimated acquisition earn-out payables: An earn-out liability is a liability to the seller upon an acquisition which is contingent on future earnings. These liabilities are valued at each reporting period and the changes are reported as either a gain or loss in the change in estimated acquisition earn-out payables account in the consolidated statements of operations. The gain or loss is non-cash, can be highly volatile and overall is not deemed relevant to ongoing operations, thus, it's excluded to provide more meaningful supplemental information regarding the Company's core operational performance.
	●	Recognition and change in fair value of warrant liabilities: This account includes changes to derivative warrant liabilities which are valued at each reporting period and could result in either a gain or loss. The period changes do not impact cash, can be highly volatile, and are unrelated to ongoing operations, and thus are excluded to provide more meaningful supplemental information regarding the Company's core operational performance.
	●	Other income (expense), net: Includes certain non-routine income or expenses and other individually de minimis items and is thus excluded as unrelated to core operations of the company.
	●	Gain on sale of business: Includes certain gains on sale of business and is thus excluded as unrelated to core operations of the company.
	●	Unrealized gains (losses) on digital assets, net: This account includes unrealized gains and losses from digital assets and is thus excluded as unrelated to core operations of the company.
	●	Transactional costs: This includes expenses related to mergers, acquisitions, financings and refinancings, and amendments or modification to indebtedness. These costs are unrelated to primary Company operations and are excluded to provide more meaningful supplemental information regarding the Company's core operational performance.
	●	Non-standard costs: This account includes non-recurring non-operational items, related to costs incurred for a legal suit the Company has filed against one of the third parties involved in previously discontinued operations and was excluded to provide more meaningful supplemental information regarding the Company's core operational performance.

Refer to the reconciliation of net (loss) income to AEBITDA, illustrated below in tabular format.

Results of Operations

RELIANCE GLOBAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS ANALYTICS

Comparison of the three months ended September 30, 2025 to the three months ended September 30, 2024

		Three Months Ended
		September 30, 2025				September 30, 2024				Value Fluctuation				Percent Fluctuation				Explanations
Commission Income ("CI")		$	2,495,975			$	3,441,458			$	(945,483	)			-27	%		CI decrease primarily driven by loss of revenue from sale of Fortman Insurance Services ("FIS") and lower medical commission revenues.
Commission Expense ("CE")			995,945				902,246				93,699				10	%		Increased CE primarily influenced by the general market conditions.
Salaries and wages ("S&W")			3,912,326				1,707,737				2,204,589				129	%		Increased S&W primarily due to non-cash share-based compensation offset by elimination of "FIS" salaries
General and administrative expenses ("G&A")			1,120,776				821,510				299,266				36	%		Increased G&A is substantially driven by director non-cash equity awards offset by OneFirm efficiencies and overall leaner operations.
Marketing and advertising expenses ("M&A")			66,917				100,183				(33,266	)			-33	%		M&A decrease consistent with Company's current marketing strategy.
Depreciation and amortization ("D&A")			313,694				421,759				(108,065	)			-26	%		Decrease pursuant to passage of time as assets become fully amortized and elimination of FIS assets.
Total operating expenses			6,409,658				3,953,435				2,456,223				62	%
											-
Loss from operations			(3,913,683	)			(511,977	)			(3,401,706	)			664	%
											-
Other income (expense)											-
Interest expense			(246,722	)			(356,320	)			109,598				-31	%		Decrease per payoff on the majority of loan balances
Interest (expense) related parties			(4,704	)			(34,802	)			30,098				-86	%		Decrease per periodic paydowns on loan balances and loan payoffs.
Other income (expense), net			(16,470	)			65,785				(82,255	)			-125	%		Decreased other income relates primarily to certain non-recurring sales of accounts.
Gain on sale of business			3,033,554				-				3,033,554							Increase pursuant to the gain on sale of FIS.
Unrealized gains (losses) on digital assets, net			(8,558	)			-				(8,558	)						Decrease per unrealized loss in digital assets
Total other (expense) income			2,757,100				(325,337	)			3,082,437				-947	%
Net loss			(1,156,583	)			(837,314	)			(319,269	)			38	%		Fluctuation explained on an account basis above.
Non-GAAP Measure
AEBITDA			(707,021	)			408,606				(749,530	)			-1,763	%		Primarily lower due to fluctuations discussed above in the revenue and commission expense accounts.

Comparison of the nine months ended September 30, 2025 to the nine months ended September 30, 2024

		Nine Months ended
		September 30, 2025				September 30, 2024				Value Fluctuation				Percent Fluctuation				Explanations
Commission Income		$	9,818,872			$	10,757,238			$	(938,366	)			-8.72	%		CI change primarily driven by loss of revenue from sale of FIS and lower medical commission revenues.
Commission Expense ("CE")			3,454,147				3,065,152				388,995				13	%		Increased CE primarily influenced by the general market conditions.
Salaries and wages ("S&W")			8,705,682				5,494,551				3,211,131				58	%		Increased S&W primarily due to non-cash share-based compensation offset by elimination of "FIS" salaries
General and administrative expenses ("G&A")			4,129,842				3,188,033				941,809				30	%		Increased G&A is substantially driven by director non-cash equity awards offset by OneFirm efficiencies and overall leaner operations.
Marketing and advertising expenses ("M&A")			201,399				304,209				(102,810	)			-34	%		M&A decrease consistent with Company's current marketing strategy
Change in estimated acquisition earn-out payables			-				47,761				(47,761	)			-100	%		Decrease pursuant to the settlement of earn-out payables.
Depreciation and amortization ("D&A")			1,020,440				1,425,700				(405,260	)			-28	%		Decrease pursuant to passage of time as assets become fully amortized and the sale of the FIS assets.
Asset impairment			-				3,922,110				(3,922,110	)			-100	%		No impaired assets during the current period.
Total operating expenses			17,511,510				17,447,516				63,994				0	%
											-
Loss from operations			(7,692,638	)			(6,690,278	)			(1,002,360	)			15	%
											-
Other income (expense)											-
Interest expense			(844,846	)			(1,091,966	)			247,120				-23	%		Decrease per payoff on the majority of loan balances
Interest (expense) related parties			(50,811	)			(112,936	)			62,125				-55	%		Decrease per periodic paydowns on loan balances and payoff on a large loan balance.
Other income (expense), net			(41,068	)			65,807				(106,875	)			-162	%		Decreased other income relates primarily to certain non-recurring sales of accounts.
Recognition and change in fair value of warrant liabilities							156,000				(156,000	)			-100	%		Decrease pursuant to the redemption of all material derivative warrant liabilities.
Gain on sale of business			3,033,554				-				3,033,554							Increase pursuant to the gain on sale of FIS.
Unrealized gains (losses) on digital assets, net			(8,558	)			-				(8,558	)						Decrease per unrealized loss in digital assets
Total other (expense) income			2,088,271				(983,095	)			3,071,366				-312	%
Loss from continuing operations before tax			(5,604,367	)			(7,673,373	)			2,069,006				-27	%		Fluctuation explained on an account basis above.
Non-GAAP Measure
AEBITDA			(918,706	)			(209,113	)			(709,593	)			339	%		Primarily lower due to fluctuations discussed above in the revenue and expense accounts.

Non-GAAP Reconciliation from Net Loss to AEBITDA

The following table provides a reconciliation from net income (loss) to AEBITDA for the period three and nine months ended September 30, 2025 and September 30, 2024

		The Period Ended September 30,								Nine Months Ended September 30,
		2025				2024				2025				2024
Net income (loss)			(1,156,583	)			(837,314	)			(5,604,367	)			(7,673,373	)
Adjustments:
Interest and related party interest expense			251,426				391,122				895,657				1,204,902
Depreciation and amortization			313,694				421,759				1,020,440				1,425,700
Asset impairment			-				-				-				3,922,110
Share based compensation employees directors and third parties			2,808,446				62,790				5,312,988				551,598
Change in estimated acquisition earn-out payables			-								-				47,761
Other (income) expense, net			16,470				(65,785	)			41,068				(65,807	)
Transactional costs			61,450				21,813				452,686				394,909
Non-standard costs			23,072				48,124				(12,182	)			139,087
Recognition and change in fair value of warrant liabilities			-				-				-				(156,000	)
Gain on sale of business			(3,033,554	)							(3,033,554	)
Unrealized gains (losses) on digital assets, net			8,558								8,558
Total adjustments			449,562				879,822				4,685,661				7,464,259
AEBITDA			(707,021	)			42,508				(918,706	)			(209,114	)

Liquidity and capital resources

The Company continues to maintain a strong liquidity position and flexible access to capital to support its operations, growth initiatives, and digital asset treasury strategy. Management believes that existing cash balances, anticipated operating cash flows, and available financing facilities provide sufficient resources to fund current obligations and planned expenditures for at least the next twelve months.

During 2025, the Company further diversified its capital structure through a combination of equity-based financing arrangements, including the Equity Line of Credit ("ELOC") with White Lion Capital, LLC, the At-the-Market ("ATM") Program with H.C. Wainwright & Co., LLC, and the Private Placement-2025 completed in June 2025. As discussed under "Recent Developments," these financing vehicles provide the Company with multiple sources of capital that may be accessed opportunistically and at prevailing market prices while maintaining control over timing and issuance levels.

During the nine months ended September 30, 2025, the Company raised approximately $4.5 million in aggregate net proceeds through these equity financing programs. This included approximately $2.0 million under the ATM Program, $0.4 million under the ELOC, and $2.1 million from the Private Placement-2025. Subsequent to September 30, 2025, the Company received an additional $0.4 million in proceeds from the sale of Common Stock under the ELOC and ATM Program. These financings, together with the exercises of the Series J-PF Warrants, contributed to an approximate 590% increase in unrestricted cash since fiscal year-end 2024.

Under the Private Placement-2025, the Company issued pre-funded warrants ("Series J-PF Warrants") and accompanying warrants ("Series J Warrants") to purchase shares of Common Stock. The Series J-PF Warrants were fully exercised during the third quarter of 2025, while the Series J Warrants remain outstanding as of September 30, 2025. As of the date of this filing, approximately $9.3 million of capacity remained available under the ELOC, and the ATM Program had been substantially utilized.

Management intends to use the net proceeds from these financings for general corporate purposes, including working capital, technology development, and purchases of digital assets pursuant to the Company's Digital Asset Treasury strategy. Management continues to evaluate additional financing alternatives and believes that the combination of strengthened balance-sheet metrics, flexible equity facilities, and expected operational cash flows provides adequate liquidity to support both near-term needs and long-term strategic growth objectives.

As of September 30, 2025, we had a combined unrestricted and restricted total cash balance of approximately $3,503,000 and working capital of approximately $1,595,000, compared with a combined unrestricted and restricted total cash balance of approximately $1,798,000 and working capital of approximately $416,000 as of December 31, 2024.

Inflation

The Company generally may be impacted by rising costs for certain inflation-sensitive operating expenses such as labor, employee benefits, and facility leases. The Company believes inflation could have a material impact on pricing and operating expenses in future periods due to the state of the economy and current inflation rates.

Off-balance sheet arrangements

We did not have any off-balance sheet arrangements, as such term is defined in Regulation S-K, during the nine months ended September 30, 2025.

Cash Flows

		Nine Months Ended September 30,
		2025				2024
Net cash used in operating activities		$	(1,469,000	)			(1,647,881	)
Net cash provided (used in) by investing activities			4,289,000				(58,787	)
Net cash (used in) provided by financing activities			(1,115,000	)			1,321,449
Net increase in cash, cash equivalents, and restricted cash		$	1,706,000			$	(385,219	)

Operating Activities

Net cash used in operating activities for the nine months ended September 30, 2025, was approximately $1,469,000, compared to net cash flows used in operating activities of approximately $1,648,000 for the nine months ended September 30, 2024. The cash used includes a net loss of approximately $5,604,000, decreased by approximate non-cash adjustments of $3,408,000 related to depreciation and amortization of approximately $1,020,000, share based compensation of approximately $5,313,000, and amortization of debt costs, non-cash lease expense, and change in fair value of digital assets of approximately $108,000 as well as a net increase in cash due to changes of net working capital items of approximately $727,000.

Investing Activities

During the nine months ended September 30, 2025, cash flows provided by investing activities approximated $4,289,000 compared to cash flows used by investing activities of approximately $58,787 for the nine months ended September 30, 2024. The cash used during the nine months ended September 30, 2025 is primarily related proceeds from the sale of Fortman Insurance Services of approximately $4,447,000, offset by cash used to purchase fixed tangible and intangible assets of approximately $43,000, and investment of digital assets of approximately $115,000.

Financing Activities

During the nine months ended September 30, 2025, approximate cash used in financing activities was $1.1 million, as compared to approximately $1.3 million of cash provided for the nine months ended September 30, 2024. Net cash used in financing activities during the nine months ended September 30, 2025, related to net proceeds received from Private Placement-2025 of approximately $2.1 million, net related party loan payable proceeds of $0.2 million, net ELOC proceeds of approximately $0.3 million and net ATM proceeds of approximately $2.1 million, offset by debt principal, and net short-term financings repayments of approximately $5.8 million.

Significant Accounting Policies and Estimates

We describe our significant accounting policies in Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, and our critical accounting estimates in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. There have been no significant changes in our significant accounting policies or critical accounting estimates since the end of fiscal year 2024.