Financial Analysis

NOTE 3 BUSINESS COMBINATION On January 19, 2024, TruGolf Holdings, Inc. (formerly known as Deep Medicine Acquisition Corp., DMAQ) completed a business combination (the Business Combination) with TruGolf, Inc. (TruGolf Nevada) pursuant to the terms of the Agreement and Plan of Merger dated May 26, 2023. Upon closing, TruGolf Nevada became a wholly-owned subsidiary of the Company, and the combined company was renamed TruGolf Holdings, Inc. The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, DMAQ was treated as the acquired company for accounting purposes, with TruGolf Nevada as the accounting acquirer. Accordingly, the consolidated financial statements of the Company represent a continuation of the financial statements of TruGolf Nevada, with the assets and liabilities of DMAQ recognized at their historical carrying values at the closing date. No goodwill or other intangible assets were recorded as a result of the Business Combination. The aggregate consideration paid to TruGolf Nevada shareholders consisted of 14,934 shares of the Companys Class A and Class B common stock, determined using an exchange ratio of approximately 1.14:1 based on 13,098 shares of TruGolf Nevada common stock outstanding immediately prior to closing. For a complete description of the Business Combination, including the purchase price allocation, transaction costs, and the composition of shares issued at closing, refer t …

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NOTE 20 COMMITMENTS AND CONTINGENCIES Legal Claims There are no material pending legal proceedings in which the Company or any of its subsidiaries is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of its voting securities, or security holder is a party adverse to the Company, or has a material interest adverse to the Company. …

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NOTE 9 NOTES PAYABLE Notes payable consisted of the following as of December 31: SCHEDULE OF NOTES PAYABLE 2025 2024 Note payable - Ethos Management Inc. $ - $ - Note payable - Mercedez-Benz 9,733 19,733 Note payable 9,733 19,733 Less deferred loan fees - Ethos Management Inc. - - Less current portion (9,733 ) (10,001 ) Note payable long-term portion $ - $ 9,732 Ethos Management Inc. In January 2023, the Company entered into a financing agreement with Ethos Asset Management Inc. (the Ethos Loan or Ethos) in the principal amount of up to $ 10 million. Pursuant to the terms of the Ethos Loan, the Company may draw down financing proceeds equal to $ 833,333 each month beginning in April 2023, up to the $ 10 million amount. Interest associated with the Ethos Loan is fixed at 4 % per annum and has a 3 three-year grace period for principal and interest payments. Annual principal and interest payments will commence in 2027 and continue through 2034. As a condition to funding, the Company provided Ethos with a $ 1,875,000 deposit as collateral (the Deposit Collateral) for the note. The Ethos Loan stipulates that fundings should happen approximately every 30 banking days, subject to Ethos completing periodic internal audits to ensure the Company was in compliance with the terms of the loan agreement. In August 2023, Ethos informed the Company that unrelated to the Company, Ethos was undergoing a routine audit of its portfolio, and pending the close of the audit, borrowers may experienc …

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SCHEDULE OF DISAGGREGATED REVENUE 2025 2024 Year Ended December 31, 2025 2024 Revenues: Golf Simulators (1) $ 14,681,994 $ 13,708,760 Content Software Subscriptions 3,710,245 7,852,699 Franchise Revenue 13,125 - Other (2) 473,633 297,405 Total net revenue $ 18,878,997 $ 21,282,649 (1) Includes items such as hardware and proprietary perpetual licenses. (2) Includes items such as shipping income and installation income.

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NOTE 21 INCOME TAXES The Company adopted ASU 2023-09 on January 1, 2025, on a prospective basis. Accordingly, the enhanced income tax disclosures required under the new standard are presented only for the year ended December 31, 2025. Prior period amounts have not been recast and are therefore not comparable. Components of Income Tax Expense (Benefit) The components of income tax expense (benefit) from continuing operations for the years ended December 31, 2025 and 2024, are as follows: SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT) December 31, 2025 December 31, 2024 Current income tax expense (benefit): Federal $ $ State Foreign Total current income taxes $ Deferred income tax expense (benefit): Federal $ 2,758,300 $ 1,878,000 State 591,300 406,800 Foreign Total deferred income taxes 3,349,600 2,284,800 Change in valuation allowance (3,349,600 ) (2,284,800 ) Income tax expense (benefit) $ $ The Company recorded no current or deferred income tax expense for the years ended December 31, 2025 and 2024, primarily due to losses and a full valuation allowance on deferred tax assets. Enhanced Disclosures (ASU 2023-09 2025) Effective Tax Rate Reconciliation (2025) The following is a reconciliation of the statutory federal income tax rate applied to pre-tax net loss compared to the income taxes in the statement of operations for the year ended December 31, 2025. In accordance with ASU 2023-09, reconciling items greater than 5% of the statutory tax rate are presented separate …

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NOTE 18 LEASES The Company is party to two leases: (i) office space in Centerville, Utah (the Centerville Lease) and (ii) a warehouse in North Salt Lake City, Utah (the SLC Lease). The Centerville lease is scheduled to expire in May 2028 and the SLC Lease is scheduled to expire in November 2026. The Company has operating leases for its corporate headquarters and warehouse. The Company determines if an arrangement contains a lease at inception based on the ability to control a physically distinct asset. Operating lease right-of-use assets are recorded in the consolidated balance sheets on the initial measurement of the lease liability as adjusted to include prepaid rent and initial direct costs less any lease incentives received. Lease liabilities are measured at the commencement date based on the present value of the lease payments over the lease term. The Company separately accounts for lease and non-lease components within lease agreements. The Company uses its incremental borrowing rate to present value the lease liability as key inputs to determine the interest rate implicit in the lease are not shared by lessors. Operating lease expense is recorded on a straight-line basis over the lease term. Right-of-use assets and lease liabilities for short-term leases are not recognized in the consolidated balance sheets. Payments for short-term leases are recognized in the consolidated statements of operations on a straight-line basis over the lease term. When measuring lease liabi …

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NOTE 11 RELATED PARTY NOTES AND LOANS PAYABLE Related party notes payable consisted of the following as of December 31: SCHEDULE OF RELATED PARTY NOTES PAYABLE 2025 2024 Note payable - ARJ Trust $ 650,000 $ 650,000 Note payable - McKettrick 500,000 800,000 Note payable - Carver 74,000 111,000 Loan - Chris Jones 1,600,000 2,000,000 Notes payable 2,824,000 3,561,000 Less current portion (2,537,000 ) (2,937,000 ) Note payable long-term portion $ 287,000 $ 624,000 Future maturities of related party notes and loan payables as of December 31, 2025: SCHEDULE OF FUTURE MATURITIES OF RELATED PARTY NOTES PAYABLE 2026 $ 2,537,000 2027 287,000 Total $ 2,824,000 ARJ Trust In December 2008, the Company entered into a note payable with ARJ Trust, a trust that is indirectly controlled by the Companys chief executive officer. The note had a principal amount of $ 500,000 , an interest rate of 8.50 % per annum, and an amended maturity date of September 30, 2025 . The Company is required to make monthly interest-only payments of $ 3,541 . In June 2010, the Company entered into a second note payable with ARJ Trust. The note has a principal amount of $ 150,000 , an interest rate of 8.50 % per annum, and an amended maturity date of September 30, 2025 . The Company is required to make monthly interest-only payments of $ 1,063 . On September 30, 2025 , the maturity date of the notes was extended to September 30, 2026 . The Company made interest-only payments of $ 55,248 during the years ended Decembe …

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Recent Accounting Pronouncements In September 2025, the FASB issued ASU 2025-06, IntangiblesGoodwill and OtherInternal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which modernizes the guidance for capitalizing internal-use software costs to better reflect contemporary software development practices, including agile and iterative methodologies. The amendments remove all references to prescriptive project stages from the existing three-stage framework and replace them with a principles-based approach under which an entity begins capitalizing software costs when two criteria are met: (1) management has authorized and committed to funding the software project, and (2) it is probable that the project will be completed and the software will be used to perform its intended function. The standard also supersedes the existing guidance on website development costs under Subtopic 350-50 and incorporates those costs into the Subtopic 350-40 framework, and requires capitalized internal-use software costs to comply with the disclosure requirements of ASC 360-10, Property, Plant, and Equipment. ASU 2025-06 is effective for all entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted, and the standard may be applied on a retrospective, prospective, or modified retrospective basis. The Company is currently evaluating the impact …

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NOTE 4 DISAGGREGATION OF REVENUES The Companys revenues are disaggregated based on revenue type, including (i) golf simulators, (ii) content software subscriptions, (iii) franchise revenue, and (iv) other. The Companys net revenues for the years ended December 31, 2025 and 2024, are disaggregated as follows: SCHEDULE OF DISAGGREGATED REVENUE 2025 2024 Year Ended December 31, 2025 2024 Revenues: Golf Simulators (1) $ 14,681,994 $ 13,708,760 Content Software Subscriptions 3,710,245 7,852,699 Franchise Revenue 13,125 - Other (2) 473,633 297,405 Total net revenue $ 18,878,997 $ 21,282,649 (1) Includes items such as hardware and proprietary perpetual licenses. (2) Includes items such as shipping income and installation income. …

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NOTE 19 SEGMENT INFORMATION The Company currently operates as one business segment, which is also the sole reportable segment, focusing on the manufacturing and sales of indoor golf simulators. The Companys business offerings have similar economic and other characteristics, including the nature of products, manufacturing, types of customers, and distribution methods. The determination of a single business segment is consistent with the consolidated financial information regularly provided to the Companys chief operating decision maker (CODM). The Companys CODM is its Principal Executive and Financial Officer and Director, who reviews and evaluates consolidated profit and loss and total assets for the purpose of assessing performance, making operating decisions, allocating resources, and planning and forecasting for future periods. In addition to the significant expense categories included within net loss presented on the Companys Consolidated Statements of Operations, see below for disaggregated amounts that comprise consulting, contract labor, personnel, business development, royalty, and marketing expenses: SCHEDULE OF REVENUE BY SEGMENT INFORMATION 2025 2024 Years Ended December 31, 2025 2024 Consulting expenses $ 2,821,782 $ 1,226,900 Contract labor 1,425,166 1,365,640 Personnel expenses 4,615,951 9,314,415 Business development expenses 332,514 528,264 Marketing expenses 776,316 710,658 Other expenses * 5,650,242 2,838,222 Total operating expenses $ 15,621,971 $ 15,984,09 …

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NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the Unites States of America (GAAP) and in conformity with the instructions on Form 10-K and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (the SEC). The consolidated financial statements include the amounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements reflect all adjustments consisting of normal recurring accruals, which are, in the opinion of management, necessary for a fair presentation of such statements. Reclassifications Certain reclassifications have been made to the financial statements for the year ended December 31, 2024, to conform to the financial statement presentation for the year ended December 31, 2025. These reclassifications had no effect on net loss or cash flows as previously reported. Use of Estimates The preparation of these consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as the disclosure of contingent assets and liabilities, at the date of and during the reported period of the consolidated financial statements. Actual results …

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NOTE 16 STOCKHOLDERS EQUITY (DEFICIT) Preferred Stock The Company has authorized preferred stock of 10,000,000 shares with a par value of $ 0.0001 . Series A Convertible Preferred Stock On April 22, 2025, in connection with the signing of the Exchange Agreements, see Note 10 PIPE Convertible Notes , the Company designated 50,000 shares of the Companys authorized and unissued preferred stock as Series A Convertible Preferred Stock (Series A Preferred). Each share of Series A Preferred has a stated value of $ 1,000 per share. The Series A Preferred, with respect to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to all capital stock of the Company. The holders of Series A Preferred will be entitled to 10% per annum dividends, payable in cash or shares of Class A common stock, provided that if the shares of Class A common stock are utilized to pay the dividends then the dividend rate will be recalculated to 15%. The Series A Preferred had a conversion rate of $ 6.31 per share and convert into Class A common stock. On each six-month anniversary of the initial issuance date of the Series A Preferred conversion price adjusted to the closing price of the Class A common stock on such date. On October 22, 2025, the conversion price was adjusted to $ 2.16 pursuant to such provisions. As a result of the 2026 Reverse Stock Split, the conversion price was adjusted to $ 21.60 . As of December 31, 2025 and December 31, 2024 …

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NOTE 23 SUBSEQUENT EVENTS Corporate Redomestication On March 10, 2026, the Company completed its redomestication from a Delaware corporation to a Nevada corporation (the Redomestication) by filing a certificate of conversion with the Secretary of State of the State of Delaware and articles of conversion with the Nevada Secretary of State. The Redomestication was approved by the Companys stockholders at the annual meeting held on February 17, 2026. In connection with the Redomestication, the Company adopted new articles of incorporation and bylaws governed by the laws of the State of Nevada. At the effective time of the Redomestication, each outstanding share of Class A Common Stock, Class B Common Stock, and Series A Preferred Stock of the Delaware corporation was automatically converted into one corresponding share of the Nevada corporation, with no change in par value. Stockholders are not required to exchange their existing stock certificates. The Redomestication did not result in any change to the Companys business, management, properties, employees, assets, liabilities, or net worth, other than costs incurred in connection with the Redomestication, and did not adversely affect the Companys existing material contracts. Stock Repurchase Subsequent to December 31, 2025, the Company repurchased 67,240 shares of its Class A common stock in two separate transactions for an aggregate purchase price of $ 532,275 , including all fees and commissions, pursuant to the Companys shar …

SubsequentEventsTextBlock · excerpt; the full note is in the filing