ALPHA MODUS HOLDINGS, INC.

Alpha Modus Holdings, Inc. (the "Company") is a technology and intellectual property company established in 2014, headquartered in Cornelius, North Carolina, focusing on the development, protection, licensing, and commercialization of data-driven systems to enhance consumer engagement and decision-making in physical retail environments. The Company's core strategy revolves around creating, licensing, and enforcing a proprietary patent portfolio that covers real-time monitoring, analysis, and response to consumer behavior at or near the point of purchase. This technology aims to convert unstructured consumer interaction data into actionable insights for personalized marketing, dynamic digital engagement, smart planograms, inventory management, and enhanced in-store customer assistance. The Company has strategically shifted from direct software and hardware deployment to a patent-first strategy to fortify its intellectual property and pursue IP-protected licensing.

The Company's business model is primarily driven by the licensing of its patented technologies to various commercial enterprises, including retailers, consumer brands, advertising technology providers, and digital media platforms. Revenue is generated through intellectual property licensing agreements, both negotiated outside of litigation and enforced through federal court actions. This dual approach is integral to its commercialization strategy, aiming to protect shareholder value and deter unauthorized use. The Company also pursues commercialization initiatives through strategic partnerships, platform integrations, and fintech-enabled retail infrastructure, including the development and rollout of consumer-facing applications and in-store kiosk technologies.

The Company's patent portfolio, which is substantially dependent on the '571 patent family, includes eleven granted U.S. patents and pending applications. These patents cover systems and methods for real-time monitoring and analysis of consumer demographic, sentiment, and behavioral data; object identification and product interaction analytics; personalized marketing and advertising tied to in-store location tracking; dynamic digital displays and interactive engagement systems; smart planograms and inventory optimization; and real-time communications, including digital coupons and targeted promotions. The '571 patent itself does not expire until May 25, 2037 ⁴, while other patents in the family expire on July 18, 2034 ⁵.

A significant product line is Alpha Modus Financial Services, LLC (AMFS), a wholly-owned subsidiary focused on financial technology and transaction-based services delivered through digital and physical retail environments. AMFS has developed the Alpha Cash platform, a proprietary mobile and kiosk-based system for underbanked and convenience-oriented consumers. This platform generates revenue through transaction-based fees, service commissions, and advertising opportunities. The Alpha Cash platform is being deployed through phased pilot programs and retail partnerships, including an initial national retailer pilot covering multiple locations, expected to begin in 2026 ⁶.

For the fiscal year ended December 31, 2025, Alpha Modus reported royalty revenue of $7,138 ⁷, a significant increase from $0 ⁸ in the prior year. The Company incurred an operating loss of $5,244,188 ⁹, compared to an operating loss of $834,895 ¹⁰ in 2024. Net loss for 2025 was $8,021,235 ¹¹, a substantial shift from a net income of $4,103,067 ¹² in 2024. Basic loss per share was $0.29 ¹³ for 2025, compared to basic EPS of $0.73 ¹⁴ in 2024. Diluted loss per share was $0.29 ¹⁵ for 2025, versus diluted EPS of $0.13 ¹⁶ in 2024. As of December 31, 2025, the Company had cash of $68,000 ¹⁷. Total liabilities were $8,595,481 ¹⁸, and total stockholders' deficit was $(48,950,162) ¹⁹.

Comparing 2025 to 2024, royalty revenue increased from $0 ⁸ to $7,138 ⁷. Operating expenses significantly rose from $834,895 ¹⁰ in 2024 to $5,251,326 ²⁰ in 2025, primarily due to increased professional fees, consulting, insurance, payroll, and public company expenses. The net income shifted from a positive $4,103,067 ¹² in 2024 to a net loss of $8,021,235 ¹¹ in 2025. This change was influenced by an increase in interest expense to $3,981,641 ²¹ in 2025 from $168,886 ²² in 2024, a gain in change in fair value of warrants liability of $803,680 ²³ in 2025 compared to a loss of $397,553 ²⁴ in 2024, and a gain in change in fair value of earnout shares liability of $1,053,084 ²⁵ in 2025 versus $18,731,514 ²⁶ in 2024. The Company also recognized a loss on settlement of debt of $760,302 ²⁷ in 2025, while 2024 included a forbearance fee expense of $13,226,926 ²⁸.

During 2025, Alpha Modus launched the Alpha Cash platform under AMFS, following the termination of a prior third-party kiosk arrangement. This platform is designed to offer financial and payment-related services and is expected to commence phased retail deployments in 2026 ⁶, including an initial national retailer pilot. The Company also entered into several strategic partnerships in 2025, including an agreement with Dollar General for technology deployment and evaluation, a strategic enterprise deployment agreement with DXC Technology for systems integration, an agreement with Genmega Inc. for hardware manufacturing and distribution, and a technology development and integration agreement with Uptiq, Inc. for software development. Financial services partnerships were also established with Mastercard, TransPecos Bank, Synctera, ACI Worldwide, DolFinTech, and Prepay Nation. Additionally, the Company entered into intellectual property licensing agreements with VSBLTY Groupe Technologies Corp. and GZ6G Technologies Corp., and continued patent enforcement actions, settling cases against The Kroger Company, Wakefern Food Corporation and Shelf Nine LLC, and Optisigns, Inc., and resolving litigation against Mood Media LLC in January 2026 ²⁹.

The Company intends to continue evolving with the industry and developing new concepts to support increasing revenue streams, specifically planning to expand the use of its '571 patent family as a lever to develop a sales team to drive potential partnerships authorized under this patent family. Alpha Modus aims to monetize its patent portfolio through licensing throughout the life of the patents, with the '571 patent not expiring until May 25, 2037 ⁴ and other patents in the family expiring on July 18, 2034 ⁵.

A major growth area for Alpha Modus is the commercialization of its Alpha Cash platform through its wholly-owned subsidiary, Alpha Modus Financial Services, LLC (AMFS). This platform, which includes both a mobile application and an in-store kiosk format, is designed to provide financial services to underbanked and convenience-oriented consumers. The Company has executed agreements supporting pilot programs and phased retail deployments beginning in 2026 ⁶, including an initial national retailer pilot covering multiple locations. Broader rollouts are anticipated in subsequent phases, along with deployment opportunities through additional retail and institutional channels.

The Company's ecosystem strategy is centered on intellectual property, aiming to empower innovation through a scalable, IP-driven platform to deliver transformative retail and digital commerce experiences. This involves combining technology, services, and strategic partnerships to provide a comprehensive ecosystem for growth. Key AI-based focus areas of the Company's technology include real-time inventory management, ads based on real-time customer data, customer assistance alerts (including shrinkage/theft prevention), smart planograms, driving traffic into brick-and-mortar retail, and AI-generated ads. These applications are intended to enhance the consumer's in-store experience, manage inventory, and monetize digital insights.

The Company expects to incur significant expenses in 2026, primarily general expenses including overhead, legal, and accounting fees, as a result of operating as a public company. To maintain its growth plan, Alpha Modus believes it will need to raise a minimum of an additional $2,500,000 ³⁰. The Company's management and other personnel will need to devote a substantial amount of time to public company requirements, which are expected to increase legal and financial compliance costs.

Alpha Modus plans to diligently pursue enforcement litigation for its patents, protect its trade secrets, and determine the validity and scope of proprietary rights of others. The Company expects to frequently engage in litigation to enforce its patents, which are typically protracted, complex, and costly. The Company also plans to spend considerable resources educating prospective licensees on the benefits of a license arrangement.

The Company's capital allocation plans include seeking additional funding through increased revenues and future financings, potentially involving borrowing money from shareholders, issuing debt or equity, or entering into strategic arrangements with third parties. As of December 31, 2025, the Company had cash of $68,000 ¹⁷ and a working capital deficit of $7,787,704 ³¹. The Company does not anticipate paying cash dividends on its common stock in the foreseeable future, expecting to retain most, if not all, available funds and future earnings to fund operations and business development.

Alpha Modus faces substantial risks, including its ability to continue as a going concern, as evidenced by recurring operating losses and negative cash flows, with an operating loss of $5,244,188 ⁹ and net cash used in operating activities of $3,210,182 ³² in 2025, and a net capital deficiency. The Company's future profitability is uncertain and dependent on the effectiveness of its monetization strategy, cost control, and growth management. The artificial intelligence (AI) technology market is highly competitive and rapidly evolving, with many competitors possessing greater resources and established relationships, which could harm Alpha Modus's ability to compete effectively. The Company's success is also vulnerable to its ability to adapt to rapidly changing technology, evolving industry standards, and changing regulations. Issues arising from the use of AI, such as flawed algorithms or biased datasets, could lead to reputational harm or legal liability.

The Company's intellectual property business is reliant on the strength of its patent portfolio, which is subject to evolving legislation and legal challenges. Obtaining and enforcing patents is costly, time-consuming, and uncertain, with no assurance that pending applications will issue or that issued patents will withstand challenges. Patent litigation is inherently risky, potentially leading to significant legal fees, settlement payments, or the need to cease using certain technologies. Changes to patent laws, such as those introduced by the Leahy-Smith America Invents Act, could diminish the value of patents and increase the cost and uncertainty of enforcement. Furthermore, the Company has limited experience in patent enforcement and licensing, which could adversely affect its operations. The Company's current patents are expected to expire between 2034 and 2037 ³³, and its continued operations beyond these dates depend on obtaining additional patents with later expiration dates.

As a public company, Alpha Modus incurs increased costs and management time devoted to compliance with regulatory requirements, which contributed to the increase in operating expenses to $5,251,326 ²⁰ in 2025. The management team has limited experience managing a Nasdaq-listed public company, posing a risk to efficient management and compliance. The Company is a "controlled company" under Nasdaq rules, allowing it to rely on exemptions from certain corporate governance requirements, which could reduce protections for shareholders. The issuance of additional common or preferred stock, including the 7,500,000 shares of Series C Preferred Stock ³⁴ issued in the Business Combination with a liquidation preference of $10.00 per share ³⁵ or an aggregate liquidation preference of $75,000,000 ³⁶, could dilute existing stockholders and adversely affect the market price of common stock. The Company also faces the risk of delisting from Nasdaq if it fails to meet continued listing standards, such as the $1.00 minimum bid price requirement ³⁷, for which it received a notice on January 12, 2026.

Management's message to shareholders emphasizes the Company's strategic shift to a patent-first strategy, focusing on the development, protection, licensing, and commercialization of its intellectual property portfolio, particularly the '571 patent family, which is seen as foundational infrastructure for real-time, data-driven consumer engagement in physical commerce. The Company aims to monetize this position through structured licensing and strategic partnerships. A key strategic priority is the commercialization of the Alpha Cash platform through its subsidiary, AMFS, with phased retail deployments expected to begin in 2026 ⁶, including an initial national retailer pilot. Management also highlights the importance of expanding the sales team to drive partnerships authorized under the '571 patent family and continuing to evolve with the industry by developing new concepts to support increasing revenue streams. Despite a net loss of $8,021,235 ¹¹ in 2025 and a working capital deficit of $7,787,704 ³¹, management believes the Company needs to raise a minimum of an additional $2,500,000 ³⁰ to maintain its growth plan and address its going concern issues.