Financial Analysis

NOTE 12 - BUSINESS COMBINATION The Merger Agreement The Company entered into a Merger Agreement dated as of October 12, 2025, by and among the Company, House of Doge, and the Merger Sub. The Merger Agreement and the transactions contemplated thereby were unanimously approved by the respective boards of directors of both Brag House and House of Doge. Pursuant to the Merger Agreement, upon the terms and subject to the conditions set forth therein, among other things, House of Doge will merge (the Merger) with and into Merger Sub, with House of Doge continuing as the surviving entity and a wholly owned subsidiary of the Company. In exchange for the outstanding shares of the House of Doges common stock and outstanding restricted stock units (RSUs), Brag House will issue shares of its Common Stock and a new class of preferred stock (that will be convertible into shares of common stock) and RSUs constituting an aggregate of approximately 663,250,176 shares of its common stock, on a fully diluted basis, to House of Doges shareholders and RSU holders, provided that any shares of its common stock that House of Doge issues to non-affiliates in arms-length commercial business transactions it negotiates in good faith in the ordinary course of business prior to the effective time of the Merger (the Effective Time) will also be exchanged in the Merger and, therefore, cause the number of shares of common stock that Brag House issues in the Merger to proportionately increase. House of Doge w …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

NOTE 4 - COMMITMENTS AND CONTINGENCIES The Company evaluates its business transactions and agreements during the course of business to identify whether any contingencies or commitments exist which would give rise to the recognition of a loss or liability. The Company is currently not involved with or know of any pending or threatening litigation against the Company or any of its officers. Further, the Company is currently complying with all relevant laws and regulations and does not have any long-term commitments or guarantees. Marketing Agreement In March of 2024, the Company entered into a marketing agreement with Outside the Box Capital, Inc. (OTB Capital) for marketing services to be provided for the six-month period from May 1, 2024 to October 31, 2024. Compensation for the services consisted of $100,000 in cash and shares of BHHI Common Stock, priced at the IPO, totaling $200,000 which equaled 50,000 shares. These shares became due 10 days after the successful completion of the Companys IPO on March 6, 2025, deemed the listing date (Listing Date), and were issued in April of 2025. The balance of $200,000 increased stockholders equity for the issuance of Common Stock for services for the year ended December 31, 2025. Lastly, if within the term of the Companys agreement with OTB Capital, the Companys shares achieve a 7-day moving average (calculated using daily VWAP) share price of $9 or more, the Company would issue an additional 50,000 shares to OTB Capital. This share …

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NOTE 7 - DEBT Convertible Debt The Company issued convertible debt during 2022 through May of 2024 under its initial round of convertible debt. The balance of convertible debt as of December 31, 2024 was $5,722,511 in outstanding principal and no remaining unamortized debt issuance costs and debt discount. As of December 31, 2024, accrued interest for the notes totaled $888,894. During 2024, the Company issued convertible debt in the form of original issue discount convertible promissory notes. These notes provide investors with a 20% discount on their investment amount. To determine the principal amount of the notes, the investment amount is divided by 0.80, reflecting that 20% original issue discount. Concurrent with the issue and sale of the notes, each holder was entitled to receive a number of shares of the Companys Common Stock, par value $0.0001 per share equal to: (i) in the case of a holder that is a Lead Investor, the quotient resulting when 20% of the Holders purchase price is divided by a price per share equal to the Valuation Cap divided by the Company Capitalization, (ii) In the case of all other holders, the quotient resulting when 5% of the Holders purchase price is divided by a price per share equal to the Valuation Cap divided by the Company Capitalization. The purchase price means the product of the principal amount of the note multiplied by 0.80. The Valuation Cap is set at $20,000,000 and the Company Capitalization means the sum of all equity securities ( …

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NOTE 10 - FAIR VALUE MEASUREMENTS Cloud Computing Arrangements - Technology Purchase Agreements In accordance with ASC 820, Fair Value Measurements and Disclosures, the Company uses various inputs to measure the fair value of its stock-based compensation liability resulting from the cash-settled written put options related to the MSA with Artemis and the SaaS with EVEMeta on a recurring basis to determine the fair value of these liabilities. The Company determines the fair value of the stock-based compensation liability using a Monte Carlo simulation. Further, as of May 12, 2025, the Company completed a fair value measurement for the cash settlement provision of its agreements with Artemis and EVEMeta, the liability classified award, using a Monte Carlo simulation model as a result of the amendment of the agreements and determined a total fair value measurement of $2,942,136. The Company recognized a stock-based compensation liability from the total fair value only to the extent in which services were provided to the Company through the amendment date, which resulted in partial recognition and was an estimate by the Company as of period end. This resulted in the recognition of a stock-based compensation liability of $116,669 as of May 12, 2025, of which $72,277 was recognized as an increase during the period April 1, 2025 to May 12, 2025 to the existing stock-based compensation liability of $44,392 as of March 31, 2025. Of the total of $72,277, $41,331 was capitalized to capi …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

NOTE 6 - INCOME TAXES The Company, with stockholders consent, elected to be taxed as an S Corporation during the years prior to 2021 under the provisions of the Internal Revenue Code under Section 1362(a) and comparable state income tax law. As an S Corporation, the Company is generally not subject to corporate income taxes and the Companys net income or loss is reported on the individual tax return of the stockholders of the Company. As a result of the UK Reorganization, the Company was no longer eligible to elect an S Corporation status for tax purposes and was subject to tax filings as a C-Corporation for the years ending 2021 through 2023. The Company filed all necessary Federal and State tax returns as a C-Corporation for the years ending 2021 through 2024, and has accrued $95,000 for any potential non-compliance penalties. The Company identified its federal and New York state tax returns as its major tax jurisdictions. The periods for income tax returns that are subject to examination for the federal and New York tax jurisdictions are 2024, 2023 and 2022. The Company believes its income tax filing positions and deductions will be sustained on audit, and management does not anticipate any adjustments that would result in a material change to its financial position. Therefore, no liabilities for uncertain tax positions have been recorded. As a result of being in a tax-loss position, the Company has not recorded a tax provision for the years ending on December 31, 2025 or …

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Recently Issued but not yet Adopted Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The standard requires that public business entities disclose additional information about specific expense categories in the notes to financial statements for interim and annual reporting periods. The standard will become effective for the Company for its fiscal year 2027 annual financial statements and interim financial statements thereafter and may be applied prospectively to periods after the adoption date or retrospectively for all prior periods presented in the financial statements, with early adoption permitted. The Company plans to adopt the standard beginning with the fiscal year 2027 annual financial statements, and management is currently evaluating the impact this guidance will have on the disclosures included in the Notes to the Consolidated Financial Statements. In July 2025, the FASB issued Accounting Standards Update (ASU) 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This ASU introduces a practical expedient, applicable to all entities, permitting the assumption that current conditions as of the balance sheet date remain unchanged over the remaining life of current accounts receivable and current contract assets arising fr …

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NOTE 3 - RELATED PARTY TRANSACTIONS The Company follows ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions. As of December 31, 2025 and 2024, the Company had payables to the Companys co-founder and Chief Executive Officer and the Companys co-founder and Chief Operating Officer for reimbursable expenses totaling $0 and $24,303, respectively. Notes Receivable and Accrued Interest - Related Party Pursuant to the Merger Agreement, on October 14, 2025, the Company loaned to House of Doge $8.0 million (the Loan), which was evidenced by a secured promissory note (the Note) that House of Doge issued in favor of the Company. On December 4, 2025, the Company and House of Doge entered into an amendment to the Note to (i) increase the principal amount of the Note to $10.0 million, (ii) permit the issuance of the Yorkville Convertible Note, as defined below, and (iii) provide for the subordination of the Companys lien over House of Doge securing House of Doges obligations under the Note to YA II PN, LTD.s, a Cayman Islands exempted limited partnership (Yorkville), with the lien in connection with the Yorkville Agreements discussed below. The Loan accrues interest at an annual rate of 5% and matures upon the earlier of (i) April 14, 2026 and (ii) the occurrence of an event of default, as defined in the Note (in most cases, with notice from the Company to House of Doge). In connection with the Loan, on October 14, 2025, …

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NOTE 8 - REVENUE RECOGNITION The Company recognizes revenue from the sale of products and services in accordance with ASC 606, Revenue from contracts with Customers . The Company generates revenues from advertising, sponsorship and league tournaments, and through the operation of its live streaming platform using a revenue model whereby gamers and creators can get free access to certain live streaming of amateur tournaments, and gamers and creators pay fees or subscriptions to compete in league competitions. The Company enters into contracts which may include combinations of products, support and professional services, which may be accounted for as separate performance obligations with differing revenue recognition patterns. At the end of December 31, 2025 and 2024, the Company did not have any contract assets or liabilities arising from contracts with customers. This was due to the fact that all service agreements for tournaments were entered into and completed in the same period. Performance Obligations The Company earns the majority of its revenue from hosting video gaming tournaments. The main performance obligation has been organizing and executing these tournaments. There are many different deliverables that are noted or implied in these contracts with customers including but not limited to, planning the event, identifying vendors and locations, completing administrative tasks, managing the event staff, coordinating the tournaments, and executing sponsorship advertiseme …

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NOTE 9 - SEGMENT REPORTING The Company and its subsidiaries manage its business activities on a consolidated basis and operate as a single operating segment (the Gaming segment). The Company is a vertically integrated social network for college gaming and its mission is to create a community which empowers gamers, streamers, and fans to interact with one another. The Companys platform, which focuses on building a centralized gaming experience for non-professional college gamers and their fans, achieves this by allowing college students to compete against one another, support their favorite gamers and teams, and win prizes. The accounting policies of the Gaming segment are the same as those described in Note 2. The Companys CODM is our Chief Executive Officer, Lavell Juan Malloy, II. The CODM uses net loss, as reported on our consolidated statements of operations and comprehensive loss, in evaluating performance of the Gaming segment and determining how to allocate resources of the Company as a whole. The CODM does not review assets in evaluating the results of the Gaming segment, and therefore, such information is not presented. The following table provides the operating financial results of our Gaming segment: Years Ended December 31, 2025 2024 Total Revenue $ - $ 105 Less: Significant and Other Segment Expenses Cost of Sales - 464 Advertising and Marketing 641,919 172,989 Legal and Professional 2,123,440 490,528 Selling, General and Administrative 3,327,087 608,904 Software …

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NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying audited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) and include the balances and results of operations of the Company and our consolidated subsidiaries. The summary of significant accounting policies presented below are designed to assist in understanding the Companys consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations of the Companys management, who is responsible for their integrity and objectivity. The Company and its subsidiaries operate as a single operating segment. Reclassification of Expenses Certain prior-period amounts have been reclassified to conform to the current-year presentation. Specifically, amounts previously reported within Selling, General and Administrative expenses have been reclassified to Software Expenses to better reflect the nature of these costs. These reclassifications had no impact on previously reported total operating expenses, net loss, or cash flows. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Segment Reporting The Company follows the guidance in ASC Topic 280, Segment Reporting , for the identification and …

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NOTE 13 - SUBSEQUENT EVENTS The Company has evaluated events and transactions subsequent to December 31, 2025 through the date these consolidated financial statements were included on Form 10-K and filed with the SEC. Other than the matters described below, there are no additional subsequent events identified that would require disclosure in the consolidated financial statements. Resignation of Chief Financial Officer Effective February 5, 2026, Chetan Jindal resigned from his position as Chief Financial Officer of Brag House Holdings, Inc. in order to pursue other opportunities. Effective February 5, 2026, the Board of Directors of the Company appointed Rene Rodriguez as the Companys Acting Chief Financial Officer. Stock Options In January of 2026, the Company issued stock options to Directors of the Company with options to purchase a total of 250,000 shares of Common Stock. The options immediately vested and carry strike prices that range from $0.45 to $0.55. Conversion of Series B Preferred Stock From January through March of 2026, shareholders of Series B Preferred Stock converted 1,743 shares of Series B Preferred Stock into 1,850,318 shares of the Common Stock. Restricted Stock Units On March 18, 2026, the Companys Board of Directors approved the cancellation of all stock options granted to the Companys CEO and COO and the grant of one RSU in exchange for each such stock option. In connection therewith, the Company granted an aggregate of 1,141,556 RSUs, of which 694,44 …

SubsequentEventsTextBlock · excerpt; the full note is in the filing