# EDGAR Filing Document

**Accession Number:** 0001939365
**File Stem:** 0001213900-25-119723
**Filing Date:** 2025-12
**Character Count:** 665878
**Document Hash:** 2dc970fbcc958374b2541d4acd111b02
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-25-119723.hdr.sgml**: 20251209

**ACCESSION NUMBER**: 0001213900-25-119723

**CONFORMED SUBMISSION TYPE**: 424B3

**PUBLIC DOCUMENT COUNT**: 4

**FILED AS OF DATE**: 20251209

**DATE AS OF CHANGE**: 20251209

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** INSPIRE VETERINARY PARTNERS, INC.
- **CENTRAL INDEX KEY:** 0001939365
- **STANDARD INDUSTRIAL CLASSIFICATION:** AGRICULTURE SERVICES [0700]
- **ORGANIZATION NAME:** 08 Industrial Applications and Services
- **EIN:** 854359258
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 424B3
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-290722
- **FILM NUMBER:** 251559917

**BUSINESS ADDRESS:**
- **STREET 1:** 780 LYNNHAVEN PKWY #400
- **CITY:** VIRGINIA BEACH
- **STATE:** VA
- **ZIP:** 23452
- **BUSINESS PHONE:** (757) 288-3088

**MAIL ADDRESS:**
- **STREET 1:** 780 LYNNHAVEN PKWY #400
- **CITY:** VIRGINIA BEACH
- **STATE:** VA
- **ZIP:** 23452

**Filed pursuant to Rule 424(b)(3)<br> Registration No. 333-290722**

**PROSPECTUS**

**INSPIRE VETERINARY PARTNERS, INC** **.**

**46,419,092 shares of Class A Common Stock**

This prospectus relates to the potential offer and resale by the selling stockholders identified in this prospectus or their permitted transferees (the "Selling Stockholders") of 46,419,092 shares of our Class A common stock, $0.0001 par value per share, (the "Class A common stock" or "Common Stock") consisting of (i) up to 26,194,092 shares of Common Stock issuable upon conversion of Series B convertible preferred stock ("Series B Preferred Stock") pursuant to that certain securities purchase agreement dated July 28, 2025 (the "Private Placement"), (ii) 7,725,000 shares of Common Stock issuable upon the exercise of warrants (at an exercise price of $1.00 per share), issued to investors in the Private Placement and (iii) up to 12,500,000 shares issuable upon conversion of the principal and accrued interest at maturity of promissory notes, as amended, in the aggregate principal amount of $1,250,000 issued to Target Capital 1, LLC ("Target") on June 10, 2025 and June 30, of 2025, respectively (collectively the "Target Notes"). See the section of this prospectus entitled "Offering" for a description of the transactions and the section entitled "Selling Stockholders" for additional information about the Selling Stockholders.

The registration of the shares of our Common Stock covered by this prospectus does not necessarily mean that any shares of our Common Stock will be sold by any of the Selling Stockholders, and we cannot predict when or in what amounts any of the Selling Stockholders may sell any of our shares of Common Stock offered by this prospectus.

The Selling Stockholders, or their respective transferees, pledgees, donees or other successors-in-interest, may sell the Common Stock through public or private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated prices. The Selling Stockholders may sell any, all or none of the securities offered by this prospectus, and we do not know when or in what amount the Selling Stockholders may sell their shares of Common Stock hereunder following the effective date of this registration statement. We provide more information about how a Selling Stockholders may sell its shares of Common Stock in the section titled "Plan of Distribution" on page 95.

There is currently a limited public trading market for our Common Stock.

Our Common Stock is listed on the Nasdaq Capital Market under the symbol "IVP." The last reported sale price of our Common Stock on the Nasdaq Capital Market on November 28, 2025, was $0.12 per share.

We are registering the shares of Common Stock on behalf of the Selling Stockholders, to be offered and sold by them from time to time. We will not receive any proceeds from the sale of the Common Stock by the Selling Stockholders in the offering described in this prospectus. We have agreed to bear all of the expenses incurred in connection with the registration of the Common Stock. The Selling Stockholders will pay or assume discounts, commissions, fees of underwriters, selling brokers or dealer managers and similar expenses, if any, incurred for the sale of the Common Stock.

We are an "emerging growth company", as that term is used in the Jumpstart Our Business Startups Act of 2012, and will be subject to reduced public company reporting requirements.

**Investing in our securities involves significant risk. You should review carefully the risk factors described in, and incorporated by reference under, "Risk Factors" beginning on page 9 of this prospectus before investing in our Class A common stock.**

**Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.**

**The date of this prospectus is December 9, 2025.**

**TABLE OF CONTENTS**

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| | |
|:---|:---|
|  | **Page** |
| [Prospectus Summary](#a_001) | 1 |
| [Cautionary Statement Regarding Forward-Looking Statements](#a_002) | 8 |
| [Risk Factors](#a_003) | 9 |
| [Use of Proceeds](#a_004) | 25 |
| [Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_005) | 26 |
| [Our Business](#a_006) | 61 |
| [Management and Board of Directors](#a_007) | 66 |
| [Executive and Director Compensation](#a_008) | 73 |
| [Security Ownership of Certain Beneficial Owners and Management](#a_009) | 80 |
| [Certain Relationships and Related Party Transactions](#a_010) | 82 |
| [Description of Capital Stock](#a_011) | 84 |
| [Private Placement of Series B Preferred Stock, Warrants and Convertible Notes](#a_012) | 89 |
| [Selling Stockholders](#a_013) | 92 |
| [Plan of Distribution](#a_014) | 95 |
| [Legal Matters](#a_015) | 97 |
| [Experts](#a_016) | 97 |
| [Where You Can Find More Information](#a_017) | 97 |
| [Index to Financial Statement](#a_018) | F-1 |

---

You should rely only on the information contained in this prospectus. Neither we, nor the Selling Stockholders have authorized anyone to provide information different from that contained in this prospectus. The Selling Stockholders are offering to sell, and seeking offers to buy, shares of Common Stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our Common Stock.

i

**PROSPECTUS SUMMARY**

Inspire Veterinary owns and operates veterinary hospitals throughout the United States. The Company specializes in small animal general practice hospitals which serve all manner of companion pets, emphasizing canine and feline breeds and including equine care. As the Company expands, it expects to acquire additional veterinary hospitals, including general practice, mixed animal facilities, and critical and emergency care.

The Company completed its initial public offering on August 31, 2023 and its shares of Class A common stock are traded on The Nasdaq Capital Market ("Nasdaq") under the symbol "IVP."

As of the date of this prospectus, the Company currently has fourteen veterinary hospitals located in nine states. Inspire Veterinary has expanded and plans to further expand through acquisitions of existing hospitals which have the financial track record, marketplace advantages and future growth potential. Because the Company leverages a leadership and support structure which is distributed throughout the United States, acquisitions are not centralized to one geographic area.

Services provided at the Company's hospitals include preventive care for companion animals consisting of annual health exams which include: parasite control; dental health; nutrition and body condition counseling; neurological examinations; radiology; bloodwork; skin and coat health and many breed specific preventive care services. Surgical offerings include all soft tissue procedures such as spays and neuters, mass removals, splenectomies and can also include gastropexies, orthopedic procedures and other types of surgical offerings based on a doctor's training. In many locations additional means of care and alternative procedures are also offered such as acupuncture, chiropractic and various other health and wellness offerings.

**Recent Developments**

*Nasdaq Delisting Notice*

 

On November 13, 2025, the Company received a notice letter (the "Notice") from the Listing Qualifications Department of Nasdaq notifying the Company that, based upon the closing bid price of the Company's Common Stock for the prior 30 consecutive business days, the Company was not in compliance with the minimum bid price requirement of Nasdaq Listing Rule 5550(a)(2). Further, the Notice stated that, pursuant to Listing Rule 5810(c)(3)(A)(iv), the Company was not eligible for any compliance period specified in Rule 5810(c)(3)(A) due to the fact that the Company has effected a reverse stock split over the prior one-year period and has effected one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one.

The Notice stated that the Company's securities will be suspended from trading on Nasdaq at the opening of business on November 24, 2025, and a Form 25-NSE will be filed with the U.S. Securities and Exchange Commission, which will remove the Company's securities from listing and registration on Nasdaq, unless the Company requests an appeal of such determination to Nasdaq's Hearings Panel (the "Panel") by November 20, 2025. The Company requested a hearing before the prescribed date, which request will stay any further suspension or delisting action by Nasdaq pending the ultimate conclusion of the hearing process. The hearing is scheduled for January 13, 2026. There can be no assurance that the Panel will grant the Company's request for continued listing or that the Company will be able to regain compliance and thereafter maintain its listing on Nasdaq.

*Partial Redemption of Series B Convertible Preferred Stock*

On December 1, 2025, the Company entered into an agreement to permit it to redeem 2,027 shares of the Series B Preferred Stock for approximately $2.7 million.

 

*Senior Convertible Promissory Notes*

On November 5, 2025, the Company issued Senior Convertible Promissory Notes to Keystone Capital Partners, LLC and Seven Knots, LLC (the "Investors"), each in the principal amount of $178,571.43 with an original issue discount of 30% such that the purchase price of each note was $125,000 (each a "Note" and together, the "Notes"). Each Note bears interest at a rate of 10% per annum, payable monthly, and matures on August 5, 2026, unless earlier converted or repaid in accordance with its terms.

The outstanding principal and accrued interest under the Notes are convertible, at the option of the holder, into shares of the Company's Common Stock. The conversion price is 90% of the lowest sale price of the Common Stock for the twenty (20) consecutive trading days ending on the trading day that is immediately prior to the conversion date, subject to customary adjustments. If the Company issues securities at a price per share less than the conversion price of the Notes, the conversion price of the Notes will be adjusted to the lower price. The Company has agreed to reserve a number of shares of its Common Stock sufficient to cover the conversion of the Notes and to file a registration statement with the Securities and Exchange Commission to register for resale the shares of Common Stock issuable upon conversion of the Notes.

 

An Investor may not convert the Notes into shares of Common Stock which, when aggregated with all other shares of the Company's Common Stock then beneficially owned by the Investor and its affiliates (as calculated pursuant to Section 13(d) of the Exchange Act, and Rule 13d-3 promulgated thereunder), would result in the Investor beneficially owning more than 4.99% of the issued and outstanding shares of the Company's Common Stock. An Investor may increase or decrease the beneficial ownership limitation, but not in excess of 9.99% of the issued and outstanding shares of the Common Stock, upon prior written notice to the Company.

The Notes must be prepaid by the Company in an amount equal to 25% of any gross proceeds received by the Company under an existing equity line of credit with Seven Knots, LLC. Any mandatory prepayment will be at a premium of 120% of the principal amount of the Notes being prepaid.

Subject to the Investors' conversion rights, if the Company completes a Qualified Financing, the Company will repay in full the then-outstanding principal amount of the Notes, any accrued but unpaid interest and a pre-payment premium equal to 120% of the Notes' value on the original issue date. A "Qualified Financing" is a financing in which the Company issues and sells shares of its equity securities to investors on or before the maturity date of the Notes with total gross proceeds to the Company of not less than $1,000,000, and excludes the conversion of the Notes or other convertible securities issued for capital raising purposes.

The Notes contain certain events of default, including non-payment, insolvency, breach of covenants, change of control and issuance of indebtedness by the Company without the Investors' consent, among others. Upon an event of default, all amounts outstanding under the Notes may become immediately due and payable at the option of the holder at a premium of 120% of the principal amount of the Notes then outstanding and any accrued but unpaid interest. In addition, for so long as the Notes remain outstanding, the interest rate will increase to an amount equal to the lesser of 24% per annum and the maximum rate permitted under applicable law.

The Company expects to use the proceeds from the issuance of the Notes for general working capital purposes.

**SUMMARY OF RISK FACTORS**

**Risks Related to our Business**

● We have a limited operating history, are not profitable and may never become profitable.

● If we fail to attract and keep senior management, we may be unable to successfully integrate acquisitions, scale our offerings of veterinary services, and deliver enhanced customer services, which may impact our results of operations and financial results.

● We may need to raise additional capital to achieve our goals.

● The Company incurs significant increased expenses and administrative burdens as a public company, which could have an adverse effect on its business, financial condition and results of operations.

● We may seek to grow our business through acquisitions of, or investments in, new or complementary businesses, and facilities, or through strategic alliances, and the failure to manage these acquisitions or strategic alliances, or to integrate them with our existing business, could have a material adverse effect on us.

● We may acquire other businesses that may be unsuccessful and could adversely dilute your ownership of our company.

● We have generated net operating loss carryforwards for U.S. income tax purposes, but our ability to use these net operating losses may be limited by our inability to generate future taxable income.

● Our management does not have experience as senior management of a public company or ensuring compliance with public company obligations, and fulfilling these obligations will be expensive and time consuming, which may divert management's attention from the day-to-day operation of its business.

● Failure to maintain effective internal controls over financial reporting could have a material adverse effect on the Company's business, operating results and stock price.

● Purchasing real estate with hospital acquisitions brings additional complexity and cost.

● Our estimate of the size of our addressable market may prove to be inaccurate.

● We may be unable to execute our growth strategies successfully or manage and sustain our growth, and as a result, our business may be adversely affected.

● We may experience difficulties recruiting and retaining skilled veterinarians due to shortages that could disrupt our business.

● Negative publicity arising from claims that we do not properly care for animals we handle could adversely affect how we are perceived by the public and reduce our sales and profitability.

● Our quarterly operating results may fluctuate due to the timing of expenses, veterinary facility acquisitions, veterinary facility closures, and other factors.

● Our reputation and business may be harmed if our or our vendors' computer network security or any of the databases containing customer, employee, or other personal information maintained by us or our third-party providers is compromised, which could materially adversely affect our results of operations.

● The animal health industry is highly competitive.

● We may be unable to adequately protect our intellectual property rights.

● We may be subject to litigation.

● Natural disasters and other events beyond our control could harm our business.

**Risks Related to Government Regulation**

● Various government regulations could limit or delay our ability to develop and commercialize our services or otherwise negatively impact our business.

● Failure to comply with governmental regulations or the expansion of existing or the enactment of new laws or regulations applicable to our veterinary services could adversely affect our business and our financial condition or lead to fines, litigation, or our inability to offer veterinary products or services in certain states.

● We may fail to comply with various state or federal regulations covering the dispensing of prescription pet medications, including controlled substances, through our veterinary services businesses, which may subject us to reprimands, sanctions, probations, fines, or suspensions.

● We are subject to environmental, health, and safety laws and regulations that could result in costs to us.

**Risks Related to our Common Shares and Securities**

● We have received a delisting notice from Nasdaq regarding our Common Stock.

● Investors who buy shares at different times will likely pay different prices.

● If securities or industry analysts do not publish research or reports about our company, or if they issue adverse or misleading opinions regarding us or our stock, our stock price and trading volume could decline.

● We do not intend to pay cash dividends for the foreseeable future.

● Our shares will be subordinate to all of our debts and liabilities, which increases the risk that you could lose your entire investment.

● Our board of directors may designate and issue shares of new classes of stock, including the issuance of up to 16,979,250 additional shares of Class B common stock, that could be superior to or adversely affect you as a holder of our Class A common stock. Although a majority of our board of directors are independent, our non-independent directors, officers, and their affiliates control approximately 54.5% of the voting power of our outstanding common stock.

● The trading price of our Common Stock is volatile, which could result in substantial losses to investors.

● The sale or availability for sale of substantial amounts of our Common Stock could adversely affect the market price.

● We are an "emerging growth company" and a "smaller reporting company" and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies and a smaller reporting companies will make our Common Stock less attractive to investors.

● We may be deemed a "controlled company" within the meaning of the rules of Nasdaq and, as a result, may qualify for, but do not intend to rely on, exemptions from certain corporate governance requirements.

**THE OFFERING**

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| | |
|:---|:---|
| Common Stock offered by Selling Stockholders | Up to 46,419,092 shares of our Class A common stock, $0.0001 par value per share, (the "Common Stock") consisting of (i) up to 26,194,092 shares issuable upon conversion of Series B convertible preferred stock ("Series B Preferred Stock") pursuant to that certain securities purchase agreement dated July 28, 2025 (the "Private Placement"), (ii) 7,725,000 shares of Common Stock issuable upon the exercise of warrants, issued to investors in the Private Placement, and (iii) up to 12,500,000 shares issuable upon conversion of the principal and accrued interest at maturity of promissory notes, as amended, in the aggregate principal amount of $1,250,000 issued to Target Capital 1, LLC ("Target") on June 10, 2025 and June 30, of 2025, respectively (collectively the "Target Notes"). |
| Class A common stock outstanding immediately prior to this offering | 38,567,465 shares of Common Stock |
| Class A common stock outstanding immediately after this offering | 84,986,557 shares of Common Stock |
| Use of proceeds | We will not receive any proceeds from the sale of shares of our Common Stock by the Selling Stockholders |
| Risk factors | Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 9 and the other information included in this prospectus for a discussion of factors you should consider carefully before deciding to invest in our securities. |
| Nasdaq symbol for our Class A common stock | "IVP" |

---

The number of shares of our Common Stock that will be outstanding immediately after this offering excludes the following:

● 20 shares of Common Stock issued to our Chair, President and Chief Executive Officer Kimball Carr in connection with his personal guaranty of certain loans to the Company at an exercise price of $6,000 per share and have an expiration date of January 1, 2028;

● 32 shares of Common Stock that are issuable upon exercise of warrants issued in connection with the initial public offering and held by Spartan Capital Securities, LLC, the underwriter in our initial public offering at an exercise price of $11,000 per share and have an expiration date of August 29, 2030;

● 332 shares of Common Stock that are issuable upon exercise of the warrants held by Target Capital 1, LLC, Dragon Dynamic Catalytic Bridge SAC Fund and 622 Capital LLC at an exercise price of $10,000 per share and have an expiration date of June 30, 2028;

● 753 shares of Common Stock that are issuable upon exercise of warrants issued in connection with the public offering in February 2024 and held by Spartan Capital Securities, LLC, the underwriter in our public offering at an exercise price of $233.75 per share and have an expiration date of August 16, 2028;

● 6,741 shares of Common Stock that are issuable upon exercise of outstanding stock options, at an exercise price of $17.00 per share. The stock options were granted and immediately vested on September 26, 2024 and have an expiration date of September 26, 2034;

● 58,480 shares of Common Stock that are issuable upon exercise of outstanding stock options, at an exercise price of $1.71 per share. The stock options were granted and immediately vested on April 1, 2025 and have an expiration date of April 1, 2035;

● 92,593 shares of Common Stock that are issuable upon exercise of outstanding stock options, at an exercise price of $1.62 per share. The stock options were granted and immediately vested on May 16, 2025 and have an expiration date of May 16, 2035;

● 34,247 shares of Common Stock that are issuable upon exercise of outstanding stock options, at an exercise price of $1.52 per share. The stock options were granted and immediately vested on May 28, 2025 and have an expiration date of May 28, 2035;

● 1,092,896 shares of Common Stock that are issuable upon exercise of warrants issued in connection with the public offering in March 2025 and held by an institutional investor, at an exercise price of $1.83 per share and have an expiration date of November 25, 2026;

● 1,092,896 shares of Common Stock that are issuable upon exercise of warrants issued in connection with the public offering in March 2025 and held by an institutional investor, at an exercise price of $1.83 per share and have an expiration date of March 25, 2030;

● 54,645 shares of Common Stock that are issuable upon exercise of warrants held by institutional investors, at an exercise price of $2.29 per share and have an expiration date of March 26, 2030;

● 193,714 shares of Common Stock that are reserved for future issuance under the Company's Common Stock Purchase Agreement dated July 29, 2025 with Seven Knots, LLC; and

● 9,450,000 shares of Common Stock that are reserved for future issuance under the Company's 2022 Equity Incentive Plan.

**CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**

This prospectus contains forward-looking statements. Forward-looking statements are based upon our current assumptions, expectations and beliefs concerning future developments and their potential effect on our business. In some cases, you can identify forward-looking statements by the following words: "may," "will," "could," "would," "should," "expect," "intend," "plan," "anticipate," "believe," "approximately," "estimate," "predict," "project," "potential," "continue," "ongoing," or the negative of these terms or other comparable terminology, although the absence of these words does not necessarily mean that a statement is not forward-looking. This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by any forward-looking statements.

We cannot predict all of the risks and uncertainties. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. These forward-looking statements are found at various places throughout this prospectus and include information concerning possible or assumed future results of our operations, including statements about potential acquisition or merger targets; business strategies; future cash flows; financing plans; plans and objectives of management; any other statements regarding future acquisitions, future cash needs, future operations, business plans and future financial results, and any other statements that are not historical facts.

All forward-looking statements speak only as of the date of this prospectus. We undertake no obligation to update any forward-looking statements or other information contained herein. Shareholders and potential investors should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements in this report are reasonable, we cannot assure stockholders and potential investors that these plans, intentions or expectations will be achieved.

These forward-looking statements represent our intentions, plans, expectations, assumptions 'and beliefs about future events and are subject to risks, uncertainties and other factors. Many of those factors are outside of our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Considering these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this prospectus. All subsequent written and oral forward-looking statements concerning other matters addressed in this prospectus and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to herein.

Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

**RISK FACTORS**

*Investing in our Class A common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together with all of the other information in this prospectus, including the section titled "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and the accompanying notes thereto included elsewhere in this prospectus, before deciding whether to invest in our Class A common stock. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties that we are unaware of or that we deem immaterial may also become important factors that adversely affect our business. The realization of any of these risks and uncertainties could have a material adverse effect on our reputation, business, financial condition, results of operations, growth and future prospects, as well as our ability to accomplish our strategic objectives. In that event, the market price of our Class A common stock could decline and you could lose part or all of your investment.*

 

*Unless the context otherwise requires, references in this section to "we," "us," "our," "Inspire Veterinary" and the "Company" refer to Inspire Veterinary Partners, Inc.*

**Risks Related to our Business**

***We have a limited operating history, are not profitable and may never become profitable.***

 ****

We have not generated any net profits to date, and we expect to continue to incur significant acquisition related costs and other expenses. Our net loss for the twelve months ended December 31, 2024 was $14,264,261 and for the year ended December 31, 2023 was $14,792,886. Our accumulated deficit as of December 31, 2024 was $36,350,281. As of December 31, 2024, we had total stockholders' equity of approximately $1,562,005. We expect to continue to incur net losses for the foreseeable future, as we continue our development and acquisition of veterinary hospitals and related veterinary servicing activities. If we fail to achieve or maintain profitability, then we may be unable to continue our operations at planned levels and be forced to reduce or cease operations.

***If our business plan is not successful, we may not be able to continue operations as a going concern and our shareholders may lose their entire investment in us.***

As of December 31, 2024, we had $723,690 cash and restricted cash.

If we fail to raise sufficient capital pursuant to the Purchase Agreement, we will have to explore other financing activities to provide us with the liquidity and capital resources we need to meet our working capital requirements and to make capital investments in connection with ongoing operations. We cannot give assurance that we will be able to secure the necessary capital when needed. Consequently, we raise substantial doubt that we will be able to continue operations as a going concern, and our independent auditors included an explanatory paragraph regarding this uncertainty in their report on our financial statements for the year ended December 31, 2024. Our ability to continue as a going concern is dependent upon our generating cash flow sufficient to fund operations and reducing operating expenses. Our business plans may not be successful in addressing the cash flow issues. If we cannot continue as a going concern, our shareholders may lose their entire investment in us. If we fail to raise sufficient capital, we will have to explore other financing activities to provide us with the liquidity and capital resources we need to meet our working capital requirements and to make capital investments in connection with ongoing operations. We cannot give assurance that we will be able to secure the necessary capital when needed. Consequently, we raise substantial doubt that we will be able to continue operations as a going concern, and our independent auditors included an explanatory paragraph regarding this uncertainty in their report on our financial statements for the years ended December 31, 2024 and 2023. Our ability to continue as a going concern is dependent upon our generating cash flow sufficient to fund operations and reducing operating expenses. Our business plans may not be successful in addressing the cash flow issues. If we cannot continue as a going concern, our shareholders may lose their entire investment in us.

***If we fail to attract and keep senior management, we may be unable to successfully integrate acquisitions, scale our offerings of veterinary services, and deliver enhanced customer services, which may impact our results of operations and financial results.***

Our success depends in part on our continued ability to attract, retain and motivate highly qualified management and senior personnel. We are highly dependent upon our senior management, particularly Kimball Carr, our President and Chief Executive Officer, and Richard Frank, our Chief Financial Officer. The loss of services of any of these individuals could negatively impact our ability to successfully integrate acquisitions, scale our employee roster, and deliver enhanced veterinary services, which may impact our results of operations and financial results. Although we have entered an employment agreement with Kimball Carr, our President and Chief Executive Officer, for one 3-year term (automatically extending for one-year terms thereafter) there can be no assurance that Mr. Carr or any other senior executive officer will extend their terms of service.

***We may need to raise additional capital to achieve our goals.***

We currently incur operate at a net loss and a comprehensive loss and anticipate incurring additional expenses as a public company. We are also seeking to identify potential complementary acquisition opportunities in the veterinary services and animal health sectors. Some of our anticipated future expenditures will include: costs of identifying additional potential acquisitions; costs of obtaining regulatory approvals; and costs associated with marketing and selling our services. We also may incur unanticipated costs. Because the outcome of our development activities and commercialization efforts is inherently uncertain, the actual amounts necessary to successfully complete the development and commercialization of our existing or future veterinary services s may be greater or less than we anticipate.

As a result, we will need to obtain additional capital to fund the development of our business. We have no master agreements or arrangements with respect to any financings, and any such financings may result in dilution to our shareholders, the imposition of debt covenants and repayment obligations or other restrictions that may adversely affect our business or the value of our common shares.

Additional funds may not be available when we need them on terms that are acceptable to us, or at all. If adequate funds are not available to us on a timely basis, we may be required to delay, limit, reduce or terminate one or more of our veterinary service programs or any future commercialization efforts.

***The Company incurs significant increased expenses and administrative burdens as a public company, which could have an adverse effect on its business, financial condition and results of operations.***

The Company will face a significant increase in insurance, legal, accounting, administrative and other costs and expenses as a public company that none of the formerly corporate or company privately-held acquisition targets that we may attempt to purchase incur as a private company. The Sarbanes-Oxley Act of 2002, as amended ("Sarbanes-Oxley Act"), including the requirements of Section 404, as well as rules and regulations subsequently implemented by the Commission, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") and the rules and regulations promulgated and to be promulgated thereunder, the Public Company Accounting Oversight Board, the Commission and the securities exchanges, impose additional reporting and other obligations on public companies. Compliance with public company requirements will increase costs and make certain activities more time-consuming. A number of those requirements will require the Company to carry out activities that it previously has not done. For example, the Company will adopt new internal controls and disclosure controls and procedures. In addition, additional expenses associated with the Commission's reporting requirements will be incurred. Furthermore, if any issues in complying with those requirements are identified (for example, if the auditors identify a material weakness or significant deficiency in the internal control over financial reporting), The Company could incur additional costs rectifying those issues, and the existence of those issues could adversely affect the Company's reputation or investor perceptions of it. Being a public company could make it more difficult or costly for the Company to obtain certain types of insurance, including director and officer liability insurance, and the Company may be forced to accept reduced policy limits and coverage with increased self-retention risk or incur substantially higher costs to obtain the same or similar coverage. Being a public company could also make it more difficult and expensive for the Company to attract and retain qualified persons to serve on the board, board committees or as executive officers. Furthermore, if the Company is unable to satisfy its obligations as a public company, it could be subject to fines, sanctions and other regulatory action and potentially civil litigation.

The additional reporting and other obligations imposed by various rules and regulations applicable to public companies will increase legal and financial compliance costs and the costs of related legal, accounting and administrative activities. These increased costs will require the Company to divert a significant amount of money that could otherwise be used to expand the business and achieve strategic objectives. Advocacy efforts by shareholders and third parties may also prompt additional changes in governance and reporting requirements, which could further increase costs.

***If we fail to manage our growth effectively, our brand, business and operating results could be harmed.***

We have experienced, and expect to continue to experience, rapid growth in our headcount and operations, which places substantial demands on management and our operational infrastructure. We will need to significantly expand our organization and systems to support our future expected growth. If we fail to manage our growth effectively, we will not be successful, and our business could fail. To manage the expected growth of our operations and personnel, we will be required to improve existing, and implement new, transaction-processing, operational and financial systems, procedures and controls. We will also be required to expand our finance, administrative and operations staff. We intend to continue making substantial investments in our technology, sales and data infrastructure. As we continue to grow, we must effectively integrate, develop and motivate a significant number of new employees, while maintaining the beneficial aspects of our existing corporate culture, which we believe fosters innovation, teamwork and a passion for our veterinary services and clients. In addition, our revenue may not grow at the same rate as the expansion of our business. There can be no assurance that our current and planned personnel, systems, procedures and controls will be adequate to support our future operations or that management will be able to hire, train, retrain, motivate and manage required personnel. If we are unable to manage our growth effectively, the quality of our platform, efficiency of our operations, and management of our expenses could suffer, which could negatively impact our brand, business, operating results and profitability.

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***We may seek to grow our business through acquisitions of, or investments in, new or complementary businesses, and facilities, or through strategic alliances, and the failure to manage these acquisitions or strategic alliances, or to integrate them with our existing business, could have a material adverse effect on us.***

The pet care industry is highly fragmented. We have completed acquisitions in the past and may pursue expansion, acquisition, investment and other strategic alliance opportunities in the future. If we are unable to manage acquisitions, or strategic ventures, or integrate any acquired businesses effectively, we may not realize the expected benefits from the transaction relative to the consideration paid, and our business, financial condition, and results of operations may be adversely affected. Acquisitions, investments and other strategic alliances involve numerous risks, including:

● problems integrating the acquired business, facilities or services, including issues maintaining uniform standards, procedures, controls and policies;

● unanticipated costs associated with acquisitions or strategic alliances;

● losses we may incur as a result of declines in the value of an investment or as a result of incorporating an investee's financial performance into our financial results;

● diversion of management's attention from our existing business;

● risks associated with entering new markets in which we may have limited or no experience;

● potential loss of key employees of acquired businesses;

● the risks associated with businesses we acquire or invest in, which may differ from or be more significant than the risks our other businesses face;

● potential unknown liabilities associated with a business we acquire or in which we invest; and

● increased legal and accounting compliance costs.

Our ability to successfully grow through strategic transactions depends upon our ability to identify, negotiate, complete and integrate suitable target businesses, facilities and services and to obtain any necessary financing. These efforts could be expensive and time-consuming and may disrupt our ongoing business and prevent management from focusing on our operations. As a result of future strategic transactions, we might need to issue additional equity securities, spend our cash, or incur debt (which may only be available on unfavorable terms, if at all), contingent liabilities, or amortization expenses related to intangible assets, any of which could reduce our profitability and harm our business. If we are unable to identify suitable acquisitions, investments or strategic relationships, or if we are unable to integrate any acquired businesses, facilities and services effectively, our business, financial condition, and results of operations could be materially and adversely affected. Also, while we employ several different methodologies to assess potential business opportunities, the new businesses or investments may not meet or exceed our expectations or desired objectives.

***We may seek to raise additional funds in the future through debt financing which may impose operational restrictions on our business and may result in dilution to existing or future holders of our common shares.***

We expect that we will need to raise additional capital in the future to help fund our business operations. Debt financing, if available, may require restrictive covenants, which may limit our operating flexibility and may restrict or prohibit us from:

● paying dividends or making certain distributions, investments and other restricted payments;

● incurring additional indebtedness or issuing certain preferred shares;

● selling some or all of our assets;

● entering into transactions with affiliates;

● creating certain liens or encumbrances;

● merging, consolidating, selling or otherwise disposing of all or substantially all of our assets; and

● designating our subsidiaries as unrestricted subsidiaries.

Debt financing may also involve debt instruments that are convertible into or exercisable for our common shares. The conversion of the debt-to-equity financing may dilute the equity position of our existing shareholders.

***We may acquire other businesses that may be unsuccessful and could adversely dilute your ownership of our company.***

As part of our business strategy, we intend to pursue acquisitions of other complementary assets and businesses and may also pursue strategic alliances. We may not be able to successfully integrate any acquisitions into our existing business, and we could assume unknown or contingent liabilities or become subject to possible stockholder claims in connection with any related-party or third-party acquisitions or other transactions. We also could experience adverse effects on our reported results of operations from acquisition-related charges, amortization of acquired technology and other intangibles and impairment charges relating to write-offs of goodwill and other intangible assets from time to time following an acquisition. Integration of an acquired company requires management resources that otherwise would be available for ongoing development of our existing business. We may not realize the anticipated benefits of any acquisition, technology license or strategic alliance.

To finance future acquisitions, we may choose to issue shares of our common stock as consideration, which would dilute your ownership interest in us. Alternatively, it may be necessary for us to raise additional funds through public or private financings. Additional funds may not be available on terms that are favorable to us and, in the case of equity financings, may result in dilution to our stockholders.

***We have generated net operating loss carryforwards for U.S. income tax purposes, but our ability to use these net operating losses may be limited by our inability to generate future taxable income.***

Our U.S. businesses have generated consolidated net operating loss carryforwards ("U.S. NOLs") for U.S. federal and state income tax purposes of $14,264,261 as of December 31, 2024. These U.S. NOLs can be available to reduce income taxes that might otherwise be incurred on future U.S. taxable income. The utilization of these U.S. NOLs would have a positive effect on our cash flow. However, there can be no assurance that we will generate the taxable income in the future necessary to utilize these U.S. NOLs and realize the positive cash flow benefit. A portion of our U.S. NOLs have expiration dates. There can be no assurance that, if and when we generate taxable income in the future from operations or the sale of assets or businesses, we will generate such taxable income before such portion of our U.S. NOLs expire. Under the Tax Cuts and Jobs Act (the "TCJA"), federal NOLs generated in tax years ending after December 31, 2017 may be carried forward indefinitely. Under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), federal NOL carryforwards arising in tax years beginning after December 31, 2017 and before January 1, 2021 may be carried back to each of the five tax years preceding the tax year of such loss. Due to our cumulative losses through December 31, 2024 we do not anticipate that such provision of the CARES Act will be relevant to us. The deductibility of federal NOLs may be limited. It is uncertain if and to what extent various states will conform to TCJA or the CARES Act.

Our ability to utilize the U.S. NOLs after an "ownership change" is subject to the rules of the United States Internal Revenue Code of 1986, as amended (the "Code") Section 382. An ownership change occurs if, among other things, the shareholders (or specified groups of shareholders) who own or have owned, directly or indirectly, 5% percent or more of the value of our shares or are otherwise treated as 5% percent shareholders under Code Section 382 and the Treasury Regulations promulgated thereunder increase their aggregate percentage ownership of the value of our shares by more than 50 percentage points over the lowest percentage of the value of the shares owned by these shareholders over a three-year rolling period. An ownership change could also be triggered by other activities, including the sale of our shares that are owned by our 5% shareholders. In the event of an ownership change, Section 382 would impose an annual limitation on the amount of taxable income we may offset with U.S. NOLs. This annual limitation is generally equal to the product of the value of our shares on the date of the ownership change multiplied by the long-term tax-exempt rate in effect on the date of the ownership change. The long-term tax-exempt rate is published monthly by the IRS. Any unused Section 382 annual limitation may be carried over to later years until the applicable expiration date for the respective U.S. NOLs (if any). In the event an ownership change as defined under Section 382 were to occur, our ability to utilize our U.S. NOLs would become substantially limited. The consequence of this limitation would be the potential loss of a significant future cash flow benefit because we would no longer be able to substantially offset future taxable income with U.S. NOLs. There can be no assurance that such ownership change will not occur in the future.

***Our management does not have experience as senior management of a public company or ensuring compliance with public company obligations, and fulfilling these obligations will be expensive and time consuming, which may divert management's attention from the day-to-day operation of its business.***

Our senior management does not have experience as senior management a publicly traded company and have limited experience complying with the increasingly complex laws pertaining to public companies. In particular, the significant regulatory oversight and reporting obligations imposed on public companies will require substantial attention from senior management and may divert attention away from the day-to-day management of its business, which could have a material adverse effect on our business, financial condition and results of operations. Similarly, corporate governance obligations, including with respect to the development and implementation of appropriate corporate governance policies will impose additional burdens on the Company's non-executive directors.

***Failure to maintain effective internal controls over financial reporting could have a material adverse effect on the Company's business, operating results and stock price.***

Effective internal control over financial reporting is necessary to increase the reliability of the Company's financial reports. The standards required for a public company under Section 404(a) of the Sarbanes-Oxley Act are significantly more stringent than those of a privately held company. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements. If the Company is not able to implement the additional requirements of Section 404(a) in a timely manner or with adequate compliance, it may not be able to assess whether its internal controls over financial reporting are effective, which may subject it to adverse regulatory consequences and could harm investor confidence and the market price of the common stock.

The Company and its auditors were not required to perform an evaluation of internal control over financial reporting as of or for the years ended December 31, 2024 or 2023 in accordance with the provisions of the Sarbanes-Oxley Act. The Company's independent registered public accounting firm will not be required to report on the effectiveness of its internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act until the Company's first annual report on Form 10-K following the date on which it ceases to qualify as an "emerging growth company," which may be up to five full fiscal years following the date of the first sale of common equity securities pursuant to an effective registration statement. If such evaluation were performed, control deficiencies could be identified by our management, and those control deficiencies could also represent one or more material weaknesses. In addition, the Company cannot, at this time, predict the outcome of this determination and whether the Company will need to implement remedial actions in order to implement effective control over financial reporting. If in subsequent years the Company is unable to assert that the Company's internal control over financial reporting is effective, or if the Company's auditors express an opinion that the Company's internal control over financial reporting is ineffective, the Company may fail to meet the future reporting obligations in a timely and reliable manner and its financial statements may contain material misstatements. Any such failure could also adversely cause our investors to have less confidence in the accuracy and completeness of our financial reports, which could have a material adverse effect on the price of the Company's common stock.

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***We may incur successor liabilities due to conduct arising prior to the completion of the various acquisitions.***

We may become subject to certain successor liabilities of recently acquired subsidiary businesses. We may also become subject to litigation claims in the operation of such businesses prior to the closing of such subsidiary acquisitions, including, but not limited to, with respect to tax, regulatory, employee or contract matters. Any litigation may be expensive and time-consuming and could divert the attention of management from its business and negatively affect its operating results or financial condition. Furthermore, the outcome of any litigation cannot be guaranteed, and adverse outcomes can affect our results of operations negatively.

***Purchasing real estate with hospital acquisitions brings additional complexity and cost.***

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By purchasing buildings and land with many of the acquisitions that the Company completes, the financing, due diligence and regulatory requirements of these purchases are much more complex. Issues such as building inspections and related delays, zoning requirements and permitting variabilities across many states all have the potential to cause delays with the purchase of acquisitions and increase the costs of acquiring target locations.

***Our estimate of the size of our addressable market may prove to be inaccurate.***

Data for retail veterinary services to domestic pets is collected for most, but not all channels, and as a result, it is difficult to estimate the size of the market and predict the rate at which the market for our services will grow, if at all. While our market size estimates have been made in good faith and is based on assumptions and estimates we believe to be reasonable, this estimate may not be accurate. If our estimates of the size of our addressable market are not accurate, our potential for future growth may be less than we currently anticipate, which could have a material adverse effect on our business, financial condition, and results of operations.

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***We may be unable to execute our growth strategies successfully or manage and sustain our growth, and as a result, our business may be adversely affected.***

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Our strategies include expanding our veterinary service offerings and building out our digital and data capabilities, growing our market share in services like grooming and training, enhancing our owned brand portfolio, and introducing new offerings to better connect with our customers. However, we may not be able to execute on these strategies as effectively as anticipated. Our ability to execute on these strategies depends on a number of factors, including:

● whether we have adequate capital resources to expand our offerings and build out our digital and data capabilities;

● our ability to relocate our pet care centers and obtain favorable sites and negotiate acceptable lease terms;

● our ability to hire, train and retain skilled managers and personnel, including veterinarians, information technology professionals, owned brand merchants, and groomers and trainers; and

● our ability to continue to upgrade our information and other operating systems and to make use of the data that we collect through these systems to offer better products and services to our customers.

Our existing locations may not maintain their current levels of sales and profitability, and our growth strategies may not generate sales levels necessary to achieve pet care center level profitability comparable to that of our existing locations. To the extent that we are unable to execute on our growth strategies in accordance with our expectations, our sales growth would come primarily from the organic growth of existing product and service offerings.

***We may experience difficulties recruiting and retaining skilled veterinarians due to shortages that could disrupt our business.***

The successful growth of our veterinary services business depends on our ability to recruit and retain skilled veterinarians and other veterinary technical staff. We face competition from other veterinary service providers in the labor market for veterinarians, and from time to time, we may experience shortages of skilled veterinarians in markets in which we operate our veterinary service businesses, which may require us or our affiliated veterinary practices to increase wages and enhance benefits to recruit and retain enough qualified veterinarians to adequately staff our veterinary services operations. If we are unable to recruit and retain qualified veterinarians, or to control our labor costs, our business, financial condition, and results of operations may be materially adversely affected.

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***Negative publicity arising from claims that we do not properly care for animals we handle could adversely affect how we are perceived by the public and reduce our sales and profitability.***

From time to time we receive claims or complaints alleging that we do not properly care for some of the pets we handle or for companion animals we handle, which mainly includes dogs and cats but may include other animals as we acquire additional facilities. Deaths or injuries may occur in the future while animals are in our care. As a result, we may be subject to claims that our animal care practices do not provide the proper level of care. Any such claims or complaints, as well as any related news reports or reports on social media, even if inaccurate or untrue, could cause negative publicity, which in turn could harm our business and have a material adverse effect on our results of operations.

***Our quarterly operating results may fluctuate due to the timing of expenses, veterinary facility acquisitions, veterinary facility closures, and other factors.***

Our expansion plans, including the timing of new and remodeled veterinary facility acquisitions, and related pre-opening costs, the amount of net sales contributed by new and existing veterinary facilities, and the timing of and estimated costs associated with veterinary facility closings or relocations, may cause our quarterly results of operations to fluctuate. Quarterly operating results are not necessarily accurate predictors of performance.

Quarterly operating results may also vary depending on a number of factors, many of which are outside our control, including:

● changes in our pricing policies or those of our competitors;

● our sales and channels mix and the relevant gross margins of the products and services sold;

● the hiring and retention of key personnel;

● wage and cost pressures;

● changes in fuel prices or electrical rates;

● costs related to acquisitions of businesses; and

● general economic factors.

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***Our continued success is largely dependent on positive perceptions of our company.***

Management believes our continued success is largely dependent on positive perceptions of our company as a high-quality employer and operator within the veterinary space. We may receive claims or complaints alleging that we do not properly care for some of the pets we handle or for companion animals we handle and sell, which may include dogs, cats, birds, fish, reptiles, and other small animals. Deaths or injuries sometimes occur while animals are in our care. As a result, we may be subject to claims that our animal care services, including grooming, training, veterinary, and other services, or the related training of our associates or handling of animals by them, do not provide the proper level of care. Our efforts to establish our reputation as a "health and wellness" company increase the risk of claims or complaints regarding our practices. Any such claims or complaints, as well as any related news reports or reports on social media, even if inaccurate or untrue, could cause negative publicity, which in turn could harm our business and have a material adverse effect on our results of operations.

To be successful in the future, we must continue to preserve, grow, and leverage the value of our reputation and our brand. Reputational value is based in large part on perceptions of subjective qualities, and even isolated incidents may erode trust and confidence and have adverse effects on our business and financial results, particularly if they result in adverse publicity or widespread reaction on social media, governmental investigations, or litigation. Our brand could be adversely affected if our public image or reputation were to be tarnished by negative publicity. Failure to comply or accusations of failure to comply with ethical, social, labor, data privacy, and environmental standards could also jeopardize our reputation and potentially lead to various adverse consumer actions. Any of these events could adversely affect our business.

As the Company grows, expanding the mergers and acquisitions team in order to select and properly integrate new locations will be necessary. We also will have to build our marketing, sales, managerial and other non-technical capabilities and make arrangements with third parties to perform certain of these other services, and we may not be successful in doing so. Building an internal sales organization is time consuming and expensive and will significantly increase our compensation expense. If we are unable to market and build proven client-acquisition processes at local level our future revenue could suffer.

***Our business may be harmed if our computer network containing employee or other information is compromised, which could adversely affect our results of operations.***

We occasionally collect or store proprietary or confidential information regarding our employees or customers, and others, including credit card information and potentially personally identifiable information. We may also collect, store, and transmit employees' health information in order to administer employee benefits; accommodate disabilities and injuries; and comply with public health requirements. We cannot assure you that future potential cyber-attacks will not expose us to material liability. Security could be compromised and confidential information, such as customer credit card numbers, employee information, or other personally identifiable information could be misappropriated, or system disruptions could occur. In addition, cyber-attacks such as ransomware attacks could lock us out of our information systems and disrupt our operations. If our information systems or infrastructure fail to perform as designed or are interrupted for a significant period of time, our business could be adversely affected.

In addition, the Company plans to expand its service offering to include, among other services, tele-veterinarian services. The Company has not implemented such tele-veterinarian services as of the date of this prospectus. However, in order to implement such services, the Company will likely require significant investments in information technology and information technology training. There can be no assurance that such investments will generate commiserate increases in revenue or profitability. In implemented, cyber-attacks such as ransomware attacks against our tele-veterinarian infrastructure could interrupt our ability to provide such services and could adversely affect that line of business.  ****

***Labor disputes may have an adverse effect on our operations.***

We are not currently party to a collective bargaining agreement with any of our employees. If we were to experience a union organizing campaign, this activity could be disruptive to our operations, increase our labor costs and decrease our operational flexibility. We cannot assure you that some or all of our employees will not become covered by a collective bargaining agreement or that we will not encounter labor conflicts or strikes. In addition, organized labor may benefit from new legislation or legal interpretations by the current presidential administration, as well as current or future unionization efforts among other large employers. Particularly, in light of current support for changes to federal and state labor laws, we cannot provide any assurance that we will not experience additional and more successful union organization activity in the future. Any labor disruptions could have an adverse effect on our business or results of operations and could cause us to lose customers. Further, our responses to any union organizing efforts could negatively impact our reputation and have adverse effects on our business, including on our financial results.

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***We may be subject to personal injury, workers' compensation, discrimination, harassment, wrongful termination, wage and hour, and other claims in the ordinary course of business.***

Our business involves a risk of personal injury, workers' compensation, discrimination, harassment, wrongful termination, wage and hour, and other claims in the ordinary course of business. We maintain general liability insurance with a self-insured retention and workers' compensation insurance with a deductible for each occurrence. We also maintain umbrella insurance above the primary general liability coverage. No assurance can be given that our insurance coverage will be available or sufficient in any claims brought against us.

Additionally, we are subject to U.S. federal, state, and local employment laws that expose us to potential liability if we are determined to have violated such employment laws, including but not limited to, laws pertaining to minimum wage rates, overtime pay, discrimination, harassment, and wrongful termination. Compliance with these laws, including the remediation of any alleged violation, may have a material adverse effect on our business or results of operations.

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***A decline in consumer spending or a change in consumer preferences or demographics could reduce our sales or profitability and adversely affect our business.***

Some of our product sales depend on consumer spending, which is influenced by factors beyond our control, including general economic conditions, disruption or volatility in global financial markets, changes in interest rates, the availability of discretionary income and credit, weather, consumer confidence, unemployment levels and government orders restricting freedom of movement. We may experience declines in sales or changes in the types of products and services sold during economic downturns. Our business could be harmed by any material decline in the amount of consumer spending, which could reduce our sales, or a decrease in the sales of higher-margin products, which could reduce our profitability and adversely affect our business.

We have also benefited from increasing pet ownership, discretionary spending on pets and current trends in humanization and premiumization in the pet industry, as well as favorable pet ownership demographics. To the extent these trends slow or reverse, our sales and profitability would be adversely affected. In particular, COVID-19 has driven an increase in pet ownership and consumer demand for our products that may not be sustained or may reverse at any time. The success of our business depends in part on our ability to identify and respond to evolving trends in demographics and consumer preferences. Failure to timely identify or effectively respond to changing consumer tastes, preferences, spending patterns and pet care needs could adversely affect our relationship with our customers, the demand for our products and services, our market share and our profitability.

***Our reputation and business may be harmed if our or our vendors' computer network security or any of the databases containing customer, employee, or other personal information maintained by us or our third-party providers is compromised, which could materially adversely affect our results of operations.***

We collect, store, and transmit proprietary or confidential information regarding our customers, employees, job applicants, and others, including credit card information and personally identifiable information. We also collect, store, and transmit employees' health information in order to administer employee benefits; accommodate disabilities and injuries; to comply with public health requirements; and to mitigate the spread of COVID-19 in the workplace. The protection of customer, employee, and company data in the information technology systems we use (including those maintained by third-party providers) is critical. In the normal course of business, we are and have been the target of malicious cyber-attack attempts and have experienced other security incidents.

Security could be compromised and confidential information, such as customer credit card numbers, employee information, or other personally identifiable information that we or our vendors collect, transmit, or store, could be misappropriated or system disruptions could occur. In addition, cyber-attacks such as ransomware attacks could lock us out of our information systems and disrupt our operations. We may not have the resources or technical sophistication to anticipate or prevent rapidly evolving types of cyber-attacks. Attacks may be targeted at us, our customers, our employees, or others who have entrusted us with information. Actual or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, train employees, and engage third-party experts and consultants. Advances in computer capabilities, new technological discoveries, or other developments may result in the breach or compromise of the technology used by us to protect transactions or other sensitive data. In addition, data and security breaches could also occur as a result of non-technical issues, including intentional or inadvertent breach by our employees or by persons with whom we have commercial relationships, that result in the unauthorized release of personal or confidential information. Any compromise or breach of our or our vendors' computer network security could result in a violation of applicable privacy and other laws, costly investigations, litigation, including class actions, and notification, as well as potential regulatory or other actions by governmental agencies and harm to our brand, business, and results of operations. As a result of any of the foregoing, we could experience adverse publicity, loss of sales, the cost of remedial measures and significant expenditures to reimburse third parties for damages, which could adversely impact our results of operations. Any insurance we maintain against the risk of this type of loss may not be sufficient to cover actual losses or may not apply to the circumstances relating to any particular loss.

***The animal health industry is highly competitive.***

The animal health industry is highly competitive. The Company is not currently engaged in product development and does not depend on product development for any of its revenue, however, the Company believes that it may face competition if the Company decides to engage in product development in future years. In such a case, the Company's competitors may include standalone animal health businesses, the animal health businesses of large pharmaceutical companies, specialty animal health businesses and companies that mainly produce generic products or offer generic services. We believe many of such competitors are conducting R&D activities in areas served by our products and or services. There are also several new start-up companies competing in the animal health industry. We may also face competition from manufacturers of drugs globally, as well as producers of nutritional health products and animal health service providers. These competitors may have access to greater financial, marketing, technical and other resources. As a result, they may be able to devote more resources to developing, manufacturing, marketing and selling their products, initiating or withstanding substantial price competition or more readily taking advantage of acquisitions or other opportunities.

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***We may be unable to adequately protect our intellectual property rights.***

We regard our brand, customer lists, trademarks, trade dress, domain names, trade secrets, proprietary technology and similar intellectual property as critical to our success. We rely on trademark law, trade secret protection, agreements and other methods with our employees and others to protect our proprietary rights. The protection of our intellectual property rights may require the expenditure of significant financial, managerial and operational resources. Moreover, the steps we take to protect our intellectual property may not adequately protect our rights or prevent third parties from infringing or misappropriating our proprietary rights, and we may be unable to broadly enforce all of our intellectual property rights. Any of our intellectual property rights may be challenged by others or invalidated through administrative process or litigation. Our trademark applications may never be granted. Furthermore, our confidentiality agreements may not effectively prevent disclosure of our proprietary information, technologies and processes and may not provide an adequate remedy in the event of unauthorized disclosure of such information.

We might be required to spend resources to monitor and protect our intellectual property rights. For example, we may initiate claims or litigation against others for infringement, misappropriation or violation of our intellectual property rights or other proprietary rights or to establish the validity of such rights. However, we may be unable to discover or determine the extent of any infringement, misappropriation or other violation of our intellectual property rights and other proprietary rights. Despite our efforts, we may be unable to prevent third parties from infringing upon, misappropriating or otherwise violating our intellectual property rights and other proprietary rights. Any litigation, whether or not it is resolved in our favor, could result in significant expense to us and divert the efforts of our technical and management personnel, which may materially and adversely affect our business, financial condition, and results of operations.

***We may be subject to litigation.***

We may become party to litigation from time to time in the ordinary course of business, which could adversely affect our business. Should any litigation in which we become involved be determined against us, such a decision could adversely affect our ability to continue operating and the market price for our Class A Common Stock and could potentially use significant resources. Even if we are involved in litigation and win, litigation can redirect significant resources of management and the Company.

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***Natural disasters and other events beyond our control could harm our business.***

Natural disasters or other catastrophic events, such as earthquakes, flooding, wildfires, power shortages, pandemics such as COVID-19, terrorism, political unrest, telecommunications failure, vandalism, cyberattacks, geopolitical instability, war, drought, sea level rise and other events beyond our control may cause damage or disruption to our operations, the operations of our suppliers and service providers, international commerce and the global economy, and could seriously harm our revenue and financial condition and increase our costs and expenses. A natural disaster or other catastrophic event in any of our major markets could have a material adverse impact on our business, financial condition, results of operations, or cash flows. Also, in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur.

**Risks Related to Government Regulation**

***Various government regulations could limit or delay our ability to develop and commercialize our services or otherwise negatively impact our business.***

We are subject to a variety of federal, state and local laws and regulations that govern, among other things, our business practices in the U.S., such as anti-corruption and anti-competition laws. rules and regulations promulgated by the Occupational Safety and Health Administration ("OSHA"), state veterinary practice acts, state veterinary ownership regulations, and by various other federal, state and local authorities regarding the medical treatment of domestic animals. See "Our Business—Government Regulation." In addition, we are subject to additional regulatory requirements, including environmental, health and safety laws and regulations administered by the U.S. Environmental Protection Agency, state, local and foreign environmental, health and safety legislative and regulatory authorities and the National Labor Relations Board, covering such areas as discharges and emissions to air and water, the use, management, disposal and remediation of, and human exposure to, hazardous materials and wastes, and public and worker health and safety. These laws and regulations also govern our relationships with employees, including minimum wage requirements, overtime, terms and conditions of employment, working conditions and citizenship requirements. Violations of or liability under any of these laws and regulations may result in administrative, civil or criminal fines, penalties or sanctions against us, revocation or modification of applicable permits, licenses or authorizations, environmental, health and safety investigations or remedial activities, warning or untitled letters or cease and desist orders against operations that are not in compliance, among other things. Such laws and regulations generally have become more stringent over time and may become more so in the future, and we may incur (directly, or indirectly through our outsourced proprietary brand manufacturing partners) material costs to comply with current or future laws and regulations. Liabilities under, and/or costs of compliance, and the impacts on us of any non-compliance, with any such laws and regulations could materially and adversely affect our business, financial condition, and results of operations. These legal and regulatory requirements differ among jurisdictions across the country and are rapidly changing and increasingly complex. The costs associated with compliance with these legal and regulatory requirements are significant and likely to increase in the future.

Any failure to comply with applicable legal and regulatory requirements could result in fines, penalties and sanctions and damage to our reputation. These developments and others related to government regulation could have a material adverse effect on our reputation, business, financial condition, and results of operations.

Additionally, some states require veterinary para-professional team members to be licensed before performing tasks and duties which are critical to the workflow of a veterinary clinic. These regulations require that we are selective in where we choose to purchase hospitals, or, allocate funds and resources to finding, training and paying for licensing for employees. As of the date of this filing, the Company has no clinics located in states where these restrictions are in place.

Further risks to our business include certain states which prohibit non-veterinarians from owning or operating a veterinary clinic. These regulations are designed to limit corporate ownership in the veterinary space and, while there are feasible workarounds which our company and others have employed, these regulations represent additional cost and complexity. Currently, the Company operates in Texas, a state in which only doctors of veterinary medicine may own veterinary hospitals. Pursuant to a management agreement between the Company and a veterinarian-owned state entity, this location is owned via a structure which complies with state regulations and allows the Company to manage necessary aspects of daily operations and derive revenue. Similarly, although no such statute exists in Indiana, the Company operates one location there and has chosen to employ a similar structure out of an abundance of caution due to uncertainty in the regulatory climate.

***Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results of operations.***

We are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply with certain Commission and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business and results of operations.

***Failure to comply with governmental regulations or the expansion of existing or the enactment of new laws or regulations applicable to our veterinary services could adversely affect our business and our financial condition or lead to fines, litigation, or our inability to offer veterinary products or services in certain states.***

All of the states in which we operate impose various registration, permit, and/or licensing requirements relating to the provision of veterinary products and services. To fulfill these requirements, we believe that we have registered with appropriate governmental agencies and, where required, have appointed a licensed veterinarian to act on behalf of each facility. All veterinarians practicing in our veterinary service businesses are required to maintain valid state licenses to practice.

In addition, certain states have laws, rules, and regulations which require that veterinary medical practices be owned by licensed veterinarians and that corporations which are not owned by licensed veterinarians refrain from providing, or holding themselves out as providers of, veterinary medical care, or directly employing or otherwise exercising control over veterinarians providing such care. We may experience difficulty in expanding our operations into other states or jurisdictions with similar laws, rules, and regulations. Our provision of veterinary services through tele-veterinarian offerings is also subject to an evolving set of state laws, rules, and regulations. Although we believe that we have structured our operations to comply with our understanding of the veterinary medicine laws of each state or jurisdiction in which we operate, interpretive legal precedent and regulatory guidance varies by jurisdiction and is often sparse and not fully developed. A determination that we are in violation of applicable restrictions on the practice of veterinary medicine in any jurisdiction in which we operate could have a material adverse effect on us, particularly if we are unable to restructure our operations to comply with the requirements of that jurisdiction.

We strive to comply with all applicable laws, regulations and other legal obligations applicable to our veterinary services. It is possible, however, that these requirements may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another or may conflict with other rules or our practices. We cannot guarantee that our practices have complied, comply, or will comply fully with all such laws, regulations, requirements, and obligations. Any failure, or perceived failure, by us to comply with our filed permits and licenses with any applicable federal-, state-, or international-related laws, industry standards or codes of conduct, regulatory guidance, orders to which we may be subject, or other legal obligations relating to privacy or consumer protection could adversely affect our reputation, brand, and business, and may result in claims, proceedings or actions against us by governmental entities or others or other liabilities. Any such claim, proceeding, or action could hurt our reputation, brand and business, force us to incur significant expenses in defending such proceedings, distract our management, increase our costs of doing business, result in a loss of customers and vendors, and may result in the imposition of monetary liability. We may also be contractually liable to indemnify and hold harmless third parties from the costs or consequences of non-compliance with any laws or regulations applicable to our veterinary services. In addition, various federal, state, and foreign legislative and regulatory bodies may expand existing laws or regulations, enact new laws or regulations, or issue revised rules or guidance applicable to our veterinary services. Any such changes may force us to incur substantial costs or require us to change our business practices. This could compromise our ability to pursue our growth strategy effectively and may adversely affect our ability to acquire customers or otherwise harm our business, financial condition, and results of operations. ****

***We may fail to comply with various state or federal regulations covering the dispensing of prescription pet medications, including controlled substances, through our veterinary services businesses, which may subject us to reprimands, sanctions, probations, fines, or suspensions.***

The sale and delivery of prescription pet medications and controlled substances through our veterinary services businesses are governed by extensive regulation and oversight by federal and state governmental authorities. The laws and regulations governing our operations and interpretations of those laws and regulations are increasing in number and complexity, change frequently, and can be inconsistent or conflicting. In addition, the governmental authorities that regulate our business have broad latitude to make, interpret, and enforce the laws and regulations that govern our operations and continue to interpret and enforce those laws and regulations more strictly and more aggressively each year. In the future, we may be subject to routine administrative complaints incidental to the dispensing of prescription pet medications through our veterinary services businesses.

***We are subject to environmental, health, and safety laws and regulations that could result in costs to us***.

In connection with the ownership and operations of our pet care centers and distribution centers, we are subject to laws and regulations relating to the protection of the environment and health and safety matters, including those governing the management and disposal of wastes and the cleanup of contaminated sites. We could incur costs, including fines and other sanctions, cleanup costs, and third-party claims, as a result of violations of or liabilities under environmental laws and regulations. Although we are not aware of any of our sites at which we currently have material remedial obligations, the imposition of remedial obligations as a result of the discovery of contaminants in the future could result in additional costs.

**Risks Related to our Class A Common Stock**

***We have received a delisting notice from Nasdaq regarding our Class A common stock.***

On November 13, 2025, the Company received a Notice from the Listing Qualifications Department of Nasdaq notifying the Company that, based upon the closing bid price of the Company's Common Stock for the prior 30 consecutive business days, the Company was not in compliance with the minimum bid price requirement of Nasdaq Listing Rule 5550(a)(2). Further, the Notice stated that, pursuant to Listing Rule 5810(c)(3)(A)(iv), the Company was not eligible for any compliance period specified in Rule 5810(c)(3)(A) due to the fact that the Company has effected a reverse stock split over the prior one-year period and has effected one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one.

The Notice stated that the Company's securities will be suspended from trading on Nasdaq at the opening of business on November 24, 2025, and a Form 25-NSE will be filed with the U.S. Securities and Exchange Commission, which will remove the Company's securities from listing and registration on Nasdaq, unless the Company requests an appeal of such determination to Nasdaq's Hearings Panel (the "Panel") by November 20, 2025. The Company requested a hearing before the prescribed date, which request will stay any further suspension or delisting action by Nasdaq pending the ultimate conclusion of the hearing process. There can be no assurance that the Panel will grant the Company's request for continued listing or that the Company will be able to regain compliance and thereafter maintain its listing on Nasdaq.

If the Class A common stock is not continued to be listed on Nasdaq, we could face significant material adverse consequences, including:

● a limited availability of market quotations for our securities;

● reduced liquidity;

● a determination that the Class A common stock is a "penny stock" which will require brokers trading in our shares to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for the common shares;

● a decrease in news about and analyst coverage for our company; and

● a decreased ability to issue additional securities or obtain additional financing in the future.

Upon delisting from Nasdaq, our Class A common stock may be traded, if at all in the over-the-counter inter-dealer quotation system, more commonly known as the OTC. OTC transactions involve risks in addition to those associated with transactions in securities traded on securities exchanges such as Nasdaq. Many OTC stocks trade less frequently and in smaller volumes than exchange-listed stocks. Accordingly, our Class A common stock would be less liquid than it would be otherwise. Also, the values of OTC stocks are often more volatile than exchange-listed stocks. Additionally, institutional investors are often prohibited from investing in OTC stocks, and it might be more challenging to raise capital when needed.

In addition, if our Class A common stock is delisted, your ability to transfer or sell your Class A common stock may be limited and the value of those securities will be materially adversely affected.

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***If our Class A common stock becomes subject to the penny stock rules, it may be more difficult to sell our Class A common stock.***

The Commission has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The OTC Bulletin Board does not meet such requirements and if the price of our Class A Common Stock is less than $5.00 and our Class A Common Stock is no longer listed on a national securities exchange such as Nasdaq, our stock may be deemed a penny stock. The penny stock rules require a broker-dealer, at least two business days prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver to the customer a standardized risk disclosure document containing specified information and to obtain from the customer a signed and dated acknowledgment of receipt of that document. In addition, the penny stock rules require that prior to effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive: (i) the purchaser's written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our Class A Common Stock, and therefore shareholders may have difficulty selling their shares.

***Investors who buy shares at different times will likely pay different prices.***

Pursuant to the terms of the Series B preferred stock and convertible promissory notes, the selling stockholders have discretion as to the timing of any conversion of the preferred stock and notes into shares of the Common Stock. If and when the selling stockholders elect to convert some or all of the preferred stock or notes the selling stockholders may resell all or a portion of such shares from time to time in its discretion and at different prices. As a result, investors who purchase shares from the selling stockholders at different times will likely pay different prices for those shares, and so may experience different levels of dilution and in some cases substantial dilution and different outcomes in their investment results. Investors may experience a decline in the value of the shares they purchase from the selling stockholders as a result of future sales made by the selling stockholders at prices lower than the prices such investors paid for their shares.

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***If securities or industry analysts do not publish research or reports about our company, or if they issue adverse or misleading opinions regarding us or our stock, our stock price and trading volume could decline.***

We will have to be obtain research coverage by securities and industry analysts; if coverage is not maintained, the market price for our stock may be adversely affected. Our stock price also may decline if any analyst who covers us issues an adverse or erroneous opinion regarding us, our business model or our stock performance, or if our operating results fail to meet analysts' expectations. If one or more analysts cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our stock price or trading volume to decline and possibly adversely affect our ability to engage in future financings.

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***We do not intend to pay cash dividends for the foreseeable future.***

We currently intend to retain our future earnings, if any, to finance the further development and expansion of our business and do not intend to pay cash dividends in the foreseeable future. We intend to invest our future earnings, if any, to fund our growth and not to pay any cash dividends on our common shares. Since we do not intend to pay dividends, your ability to receive a return on your investment will depend on any future appreciation in the market price of our common shares. There is no assurance that our common shares will appreciate in price. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as our board of directors deems relevant.

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***Our shares will be subordinate to all of our debts and liabilities, which increases the risk that you could lose your entire investment.***

Our shares are equity interests that will be subordinate to all of our current and future indebtedness with respect to claims on our assets. In any liquidation, all of our debts and liabilities must be paid before any payment is made to our shareholders. The amount of any debt financing we incur creates a substantial risk that in the event of our bankruptcy, liquidation or reorganization, we may have no assets remaining for distribution to our shareholders after payment of our debts.

***Our board of directors may designate and issue shares of new classes of stock, including the issuance of up to 16,979,250 additional shares of Class B common stock, that could be superior to or adversely affect you as a holder of our Class A common stock. Although a majority of our board of directors are independent, our non-independent directors, officers, and their affiliates control approximately 54.5% of the voting power of our outstanding common stock.***

Our board of directors has the power to designate and issue shares of classes of stock, including preferred stock that have voting powers, designations, preferences, limitations and special rights, including preferred distribution rights, conversion rights, redemption rights and liquidation rights without further shareholder approval which could adversely affect the rights of the holders of our Common Stock. In addition, our board could authorize the issuance of a series of preferred stock that has greater voting power than our Common Stock or that is convertible into our Common Stock, which could decrease the relative voting power of our Common Stock or result in dilution to our existing common stockholders. Although a majority of our board of directors are independent, our non-independent directors, officers, and their affiliates control approximately 54.5% of the voting power of our outstanding common stock. Our non-independent directors, officers and their affiliates may, through their control of over a significant portion of the voting power of our outstanding common stock, could influence the Company to take corporate actions or engage in transactions that may be at odds with the interests of other investors in our common stock.

Any of these actions could significantly adversely affect the investment made by holders of our Common Stock. Holders of Common Stock could potentially not receive dividends that they might otherwise have received. In addition, holders of our Common Stock could receive less proceeds in connection with any future sale of the Company, whether in liquidation or on any other basis.

Our articles of incorporation authorize the issuance of one hundred million (100,000,000) shares of Class A common stock, twenty million (20,000,000) shares of Class B common stock, and fifty million (50,000,000) shares of preferred stock. We currently have 38,567,465, 3,020,750 and 7,593 shares of Class A common stock, Class B common stock and Series B preferred stock, respectively, issued and outstanding. The Class B common stock is identical to the Class A common stock, except that each share of Class B common stock entitles the holder of such share 25 votes per share and is convertible into one share of Class A common stock. If our board of directors determined to issue the remaining 16,979,250 unissued Class B shares, such shares would represent an additional 424,481,250 votes and non-affiliated investors in our Class A Common Stock would have voting power of less than 1%.

Charles Stith Keiser, a member of our board of directors, owns 2,150,000 shares of our Class B common stock and 10 shares of our Class A common stock, and controls approximately 47.1% of the voting power of the outstanding common stock of the Company.

Mr. Carr, our Chair of the board, President and Chief Executive Officer and Mr. Keiser, who own a combined 2,483,250 shares of our Class B common stock and 21 shares of our Class A common stock, control approximately 54.5% of the voting power of the outstanding common stock prior to the issuance of any additional shares.

Because we do not expect any single holder or entity to hold more than 50% of the outstanding voting power of the Company, we do not believe we will qualify as a "controlled company" under the Nasdaq listing rules. See "—We may be deemed a 'controlled company' within the meaning of the rules of Nasdaq and, as a result, may qualify for, but do not intend to rely on, exemptions from certain corporate governance requirements."

However, any future issuance of Class A common stock or Class B common stock will result in substantial dilution in the percentage of our Class A common stock held by our then existing shareholders. We may value any common stock issued in the future on an arbitrary basis. The issuance of common stock for future services or acquisitions or other corporate actions may have the effect of diluting the value of the shares held by our investors and might have an adverse effect on any trading market for our Class A Common Stock.

***The trading price of our Common Stock is volatile, which could result in substantial losses to investors.***

The trading price of our Common Stock is volatile and could fluctuate widely due to factors beyond our control. This may happen because of broad market and industry factors, including the performance and fluctuation of the market prices of other companies with business operations located outside of the United States. In addition to market and industry factors, the price and trading volume for our Common Stock may be highly volatile for factors specific to our own operations, including the following:

● the potential delisting of our Common Stock from The Nasdaq Capital Market;

● variations in our revenues, earnings and cash flow;

● announcements of new investments, acquisitions, strategic partnerships or joint ventures by us or our competitors;

● announcements of new offerings, solutions and expansions by us or our competitors;

● changes in financial estimates by securities analysts;

● detrimental adverse publicity about us, our brand, our services or our industry;

● additions or departures of key personnel;

● sales of additional equity securities; and

● potential litigation or regulatory investigations.

Any of these factors may result in large and sudden changes in the volume and price at which our Common Stock will trade.

In the past, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities. If we were involved in a class action suit, it could divert a significant amount of our management's attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which could harm our results of operations. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.

***The sale or availability for sale of substantial amounts of our Common Stock could adversely affect their market price.***

Sales of substantial amounts of our Common Stock in the public market, or the perception that these sales could occur, could adversely affect the market price of our Common Stock and could materially impair our ability to raise capital through equity offerings in the future. The sale of a significant number of shares being offered could depress the market price of the Company's Common Stock.

Such volatility, including any stock-run up, may be unrelated to our actual or expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our stock. Furthermore, the stock market in general experiences price and volume fluctuations that are often unrelated or disproportionate to the operating performance of companies like us. Volatility or a lack of positive performance in the price of our shares of Common Stock may also adversely affect our ability to retain key employees.

In addition, the stock market, in general, or the market for stocks in our industry, in particular, may experience broad market fluctuations, which may adversely affect the market price or liquidity of our common shares. Any sudden decline in the market price of our common shares could trigger securities class-action lawsuits against us. If any of our shareholders were to bring such a lawsuit against us, we could incur substantial costs defending the lawsuit and the time and attention of our management would be diverted from our business and operations. We also could be subject to damages claims if we are found to be at fault in connection with a decline in our stock price.

***We are an "emerging growth company" and a "smaller reporting company" and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies and a smaller reporting companies will make our Common Stock less attractive to investors.***

We are an "emerging growth company," as defined in the JOBS Act, and we expect to take advantage of certain exemptions and relief from various reporting requirements that are applicable to other public companies that are not emerging growth companies. In particular, while we are an emerging growth company: we will not be required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act; we will be exempt from any rules that could be adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotations or a supplement to the auditor's report on financial statements; we will be subject to reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and we will not be required to hold nonbinding advisory votes on executive compensation or stockholder approval of any golden parachute payments not previously approved.

In addition, while we are an emerging growth company we can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of this extended transition period and, as a result, our operating results and financial statements may not be comparable to the operating results and financial statements of companies who have adopted the new or revised accounting standards.

We may remain an emerging growth company until as late as December 31, 2028, though we may cease to be an emerging growth company earlier under certain circumstances, including if (i) we have more than $1.235 billion in annual revenue in any fiscal year, (ii) the market value of our Class A Common Stock that is held by non-affiliates exceeds $700 million as of the last business day of its most recently completed second fiscal quarter or (iii) we issue more than $1.0 billion of non-convertible debt over a three-year period.

Even after we no longer qualify as an emerging growth company, we may still qualify as a smaller reporting company, which would allow us to continue to take advantage of many of the same exemptions from disclosure requirements, including, among other things, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, presenting only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and reduced disclosure obligations regarding executive compensation in this prospectus and our periodic reports and proxy statements.

Investors may find our Common Stock less attractive to the extent we rely on the exemptions and relief granted by the JOBS Act. If some investors find our Class A Common Stock less attractive as a result, there may be a less active trading market for our Common Stock and our stock price may decline or become more volatile.

***We may be deemed a "controlled company" within the meaning of the rules of Nasdaq and, as a result, may qualify for, but do not intend to rely on, exemptions from certain corporate governance requirements.***

Charles Stith Keiser, our director and the holder of 2,150,000 shares of our Class B common stock and 10 shares of our Class A common stock, controls approximately 47.1% of the voting power of the Company as of the date of this prospectus. However, if Mr. Keiser were to control greater than 50% of the voting power of our Class A common stock, the Company may be deemed a "controlled company" within the meaning of the corporate governance standards of Nasdaq. Under the rules of Nasdaq, a company of which more than 50% of the outstanding voting power is held by an individual, group or another company is a "controlled company" and may elect not to comply with certain stock exchange corporate governance requirements, including the requirement that a majority of the board of directors consists of independent directors, have a nominating and governance committee and compensation committee that is composed entirely of independent directors and the requirement for an annual performance evaluation of the nominating and governance committee and compensation committee.

We do not intend to rely on these exemptions and instead intend to comply with all of the corporate governance requirements imposed by state and federal law, the rules and regulations of the Securities and Exchange Commission and Nasdaq.

**USE OF PROCEEDS**

We will not receive any proceeds from the sales of shares of our Common Stock by the Selling Stockholders.

**DETERMINATION OF OFFERING PRICE**

The Selling Stockholders will offer shares of our Common Stock at the prevailing market prices or privately negotiated prices. The offering price of our Common Stock does not necessarily bear any relationship to our book value, assets, past operating results, financial condition or any other established criteria of value. Our Common Stock may not trade at the market prices in excess of the offering prices for Common Stock in any public market, will be determined in the marketplace and may be influenced by many factors, including the depth and liquidity of the market for our Common Stock.

**MARKET PRICE OF AND DIVIDENDS ON THE COMPANY'S**

**COMMON EQUITY AND RELATED STOCKHOLDER MATTERS**

Our Common Stock is listed on Nasdaq under the symbol "IVP". On November 28, 2025, the closing price on Nasdaq of our Common Stock was $0.12.

**Holders**

As of November 21, 2025, there were 131 stockholders of record for our Class A common stock, three stockholders of record for our Class B common stock and seven stockholders of record for our Series B preferred stock.

**Dividend Policy** 

We do not anticipate declaring or paying, in the foreseeable future, any cash dividends on our capital stock. We intend to retain all available funds and future earnings, if any, to fund the development and expansion of our business, and we do not anticipate paying any cash dividends in the foreseeable future. Any future determination regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects and other factors our board of directors may deem relevant.

**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 in conjunction with our consolidated financial statements and the accompanying notes thereto included elsewhere in this prospectus. Some of the information contained in this discussion and analysis or set forth elsewhere in this prospectus, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should read the sections titled "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements" 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.*

**Overview**

Inspire Veterinary Partners, Inc. is a corporation incorporated in the state of Delaware in 2020. On June 29, 2022, the Company converted into a Nevada corporation. The Company's class A common shares are traded on the Nasdaq Capital Market ("NASDAQ") under the symbol IVP. The Company owns and operates veterinary hospitals throughout the United States. The Company specializes in small animal general practice hospitals which serve all manner of companion pets, emphasizing canine and feline breeds. As the Company expands, additional modalities are expected to become a part of the offerings at its hospitals. The acquisition of The Pony Express Veterinary Hospital, Inc. includes equine care and emergency and specialty services and the Company intends to continue to expand such services.

With fourteen clinics located in nine states as of the date of this filing, Inspire purchases existing hospitals which have the financial track record, marketplace advantages and future growth potential which make them worthy acquisition targets. Because the Company leverages a leadership and support structure which is distributed throughout the United States, acquisitions are not centralized to one geographic area. The Company operates it business as one operating and one reportable segment.

The Company is the managing member of IVP Practice Holdings Co., LLC ("Holdco"), a Delaware limited liability company, which is the managing member of IVP CO Holding, LLC ("CO Holdco"), a Delaware limited liability company, IVP FL Holding Co., LLC ("FL Holdco"), a Delaware limited liability company, IVP Texas Holding Company, LLC ("TX Holdco"), a Delaware limited liability company, KVC Holding Company, LLC ("KVC Holdco"), a Hawaii limited liability company, IVP CA Holding Co., LLC ("CA Holdco"), a Delaware limited liability company, IVP MD Holding Company, LLC ("MD Holdco"), a Delaware limited liability company, IVP OH Holding ("OH Holdco"), Co, LLC, a Delaware limited liability company, IVP IN Holding Co., LLC ("IN Holdco"), a Delaware limited liability company, IVP MA Managing Co., LLC, a Delaware limited liability company ("MA Holdco"), and IVP PA Holding Company, LLC, a Delaware limited liability company ("PA Holdco"). The Company through Holdco, operates and controls all business and affairs of CO Holdco, FL Holdco, TX Holdco, KVC Holdco, CA Holdco, MD Holdco, OH Holdco, IN Holdco, MA Holdco and PA Holdco. Holdco is used to acquire hospitals in various states and jurisdictions.

The Company is the managing member of IVP Real Estate Holding Co., LLC ("IVP RE"), a Delaware limited liability company, which is the managing member of IVP CO Properties, LLC ("CO RE"), a Delaware limited liability company, IVP FL Properties, LLC ("FL RE"), a Delaware limited liability company, IVP TX Properties, LLC ("TX RE"), a Delaware limited liability company, KVC Properties, LLC, ("KVC RE"), a Hawaii limited liability company, IVP CA Properties, LLC ("CA RE"), a Delaware limited liability company, IVP MD Properties, LLC ("MD RE"), a Delaware limited liability company, IVP OH Properties, LLC ("OH RE"), a Delaware limited liability company, IVP IN Properties, LLC ("IN RE"), a Delaware limited liability company, and IVP PA Properties, LLC ("PA RE"), a Delaware limited liability company. The Company through IVP RE operates and controls all business and affairs of CO RE, FL RE, TX RE, KVC RE, CA RE, MD RE, OH RE, IN RE and PA RE. IVP RE is used to acquire real property in various states and jurisdictions.

**Our Business Model**

Services provided at owned hospitals include preventive care for companion animals consisting of annual health exams which include: parasite control; dental health; nutrition and body condition counseling; neurological examinations; radiology; bloodwork; skin and coat health and many breed specific preventive care services. Surgical offerings include all soft tissue procedures such as spays and neuters, mass removals, splenectomies and can also include gastropexies, orthopedic procedures and other types of surgical offerings based on a doctor's training. In many locations additional means of care and alternative procedures are also offered such as acupuncture, chiropractic and various other health and wellness offerings.

With acquisitions serving as one key driver of growth, the Company has developed metrics and processes for assessing, valuing, acquiring and integrating new hospitals into its network. With a focus in its early years on general practice, small companion animal hospitals, the Company selects hospitals in markets with large addressable pet populations, but not necessarily in city/urban centers. The Company recently entered the equine care, or the care of horses, sector with the addition of the Pony Express Veterinary Hospital into the Company's small-animal-only mix of locations.

Growth strategies and expansion plans call for the Company to enter emergency care and mixed animal (such as bovine and additional equine care) in future years of growth. Staffing, ownership transition plans, demographics, quality of medicine, financial performance and quality of exiting leadership are some of the many factors that are analyzed before a pending acquisition is offered a letter of intent. The Company uses a field support structure that is nationally distributed and therefore the targets for acquisition can be in most states within the United States, taking special care with more complex states which have very specific veterinary practice ownership and operations guidelines.

Risks to the ability to swiftly acquire and integrate new hospitals include: (i) national staffing shortages of veterinarians and technicians which pre-existed the current market conditions which make finding credentialed talent even more difficult; (ii) costs and time associated with finding suitable targets and performing due diligence; and (iii) difficulties in achieving growth targets post purchase which ensure hospitals grow revenue and earnings in the years post purchase.

Post purchase pressures include rising talent acquisition and staffing costs in addition to challenges in achieving productivity and average patient charges necessary to achieve growth and profitability.

**Results of Operations**

**Acquisition and Growth Strategy**

With an emphasis on general practice hospitals in its first seven to eight quarters, the Company expanded into purchase of mixed animal hospitals in late 2022, adding equine care to its mix. Further, the Company intends to continue to focus on strategically acquiring existing general practice, specialty hospitals and/or expand existing locations to include emergency care and more complex surgeries, holistic care and comprehensive diagnostics which allow it to offer more complex surgeries and internal medicine work ups.

The Company has plans to seek multi-unit practices with regional presence to facilitate growth for the Company and also to move more swiftly into being a prime provider in select markets. While purchases of individual clinics will remain a focus for the Company, these opportunities to acquire hospitals in clusters of 2 to 6 will significantly increase our pace of growth and provide numerous internal benefits such as internal case referrals and career pathing for clinicians and leadership.

We account for acquisitions under the acquisition method and are required to measure identifiable assets acquired and liabilities assumed of the acquiree at the fair values on the closing date. The Company makes an initial allocation of the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets and assumed liabilities. Below is a summary of the acquisitions that closed from the inception of the Company through September 30, 2025, and the related transaction price.

---

| | | |
|:---|:---|:---|
| **Name** | **Closing Date** | **Transaction<br> Value<sup>1</sup>** |
| Kauai Veterinary Clinic<sup>3,6</sup> | January 2021 | $1505000 |
| Chiefland Animal Hospital<sup>2</sup> | August 2021 | $564500 |
| Pets & Friends Animal Hospital<sup>2</sup> | October 2021 | $630000 |
| Advanced Veterinary Care of Pasco<sup>3</sup> | January 2022 | $1014000 |
| Lytle Veterinary Clinic<sup>2</sup> | March 2022 | $1442469 |
| Southern Kern Veterinary Clinic<sup>2</sup> | March 2022 | $2000000 |
| Bartow Animal Clinic<sup>3,4</sup> | May 2022 | $1405000 |
| Dietz Family Pet Hospital<sup>2</sup> | June 2022 | $500000 |
| Aberdeen Veterinary Clinic<sup>3</sup> | July 2022 | $574683 |
| All Breed Pet Care Veterinary Clinic<sup>2</sup> | August 2022 | $2152000 |
| Pony Express Veterinary Hospital, Inc.<sup>2</sup> | October 2022 | $3108652 |
| Williamsburg Animal Clinic<sup>3</sup> | December 2022 | $850000 |
| The Old 41 Animal Hospital<sup>2</sup> | December 2022 | $1465000 |
| Valley Veterinary Services<sup>3,5</sup> | November 2023 | $1790000 |
| DeBary Animal Clinic <sup>2,7</sup> | June 2025 | $1942500 |

---

1. The transaction value is the amount of cash consideration paid for the acquisition of the veterinary practice (and as denoted the real estate operations) that was accounted for as a single business combination, in accordance with ASC Topic 805.

2. Acquisition includes both the veterinary practice and related assets and the real estate operations in the transaction value.

3. Acquisition was for the veterinary practice and related assets only.

4. Acquisition includes the purchase of personal goodwill of $105,000 that was included in the purchase price of the veterinary practice and related assets. The total transaction value is made up of $955,000 for the veterinary practice and related assets and $350,000 for the real estate operations.

5. The transaction value excludes $200,000 for the Holdback Agreement associated with the acquisition.

6. The veterinary practice was sold on September 20, 2024.

7. The transaction value excludes $114,500 for the Holdback Agreement associated with the acquisition.

*Kauai Veterinary Clinic Acquisition and Disposal*

On January 25, 2021, the Company acquired Kauai Veterinary Clinic, Inc., located in Lihue, Hawaii on the island of Kauai providing regional and local veterinary services for $1,505,000 through the Company's wholly-owned subsidiary, IVP Practice Holding Company, LLC. Simultaneously to the closing of Kauai Veterinary Clinic Inc., the Company acquired the underlying real estate from a third party in exchange for $1,300,000 through the Company's wholly-owned subsidiary, IVP Real Estate Holding Co., LLC. These acquisitions were financed with threes loans provided by First Southern National Bank for a total of $2,383,400.

On September 20, 2024, the Company completed the divestiture of its Kauai Veterinary Clinic ("KVC") to Kauai RE Holdings LLC for $2.0 million, in notes payable assumed by the buyer, with no cash consideration. The agent for the sale was Gregory Armstrong, a current shareholder of the Company and a member of Kauai RE. Charles Keiser, DVM, is a member of Kauai RE and the father of our board member Charles Stith Keiser, who is the Company's largest shareholder through his entity Wilderness Trace Veterinary Partners, LLC. The divestiture resulted in a gain of $467,049 in fiscal year 2024, which was recorded in "Gain on sale of business" in the Statements of Operations. As a result of the transaction, the Company disposed of $125,508 of goodwill based on the relative fair value of KVC. The estimated fair value of KVC less estimated costs to sell exceeded it carrying amount as of the transaction date. As the sale of KVC was not considered, a significant disposal or a strategic shift that would have a major effect on the Company's operations or financial results, it was not reported as discontinued operations.

*Chiefland Animal Hospital Acquisition*

On August 20, 2021, the Company acquired the veterinary practice and related assets of Chiefland Animal Hospital from Polycontec, Inc. for $285,000 through the Company's wholly-owned subsidiary, IVP Practice Holding Company, LLC. Simultaneously, the Company acquired the real estate operations, consisting of land and buildings, utilized by the Chiefland practice for $279,500 through the Company's wholly-owned subsidiary, IVP Real Estate Holding Co., LLC. These acquisitions were financed with two loans provided by WealthSouth, a division of Farmers National Bank of Danville, Kentucky ("WealthSouth") for a total of $469,259.

*Pets & Friends Animal Hospital Acquisition*

On October 7, 2021, the Company acquired the veterinary practice and related assets of the Pets & Friends Animal Hospital from Pets & Friends Animal Hospital, LLC for $375,000 through the Company's wholly-owned subsidiary, IVP Practice Holding Company, LLC. Simultaneously, the Company acquired the real estate operations, consisting of land and buildings, utilized by the Pets & Friends practice for $255,000 through the Company's wholly-owned subsidiary, IVP Real Estate Holding Co., LLC. These acquisitions were financed with two loans provided by WealthSouth for a total of $535,500.

*Advanced Veterinary Care of Pasco*

On January 14, 2022, the Company acquired the veterinary practice and related assets of Advanced Veterinary Care of Pasco in Hudson, Florida from Advanced Veterinary Care of Pasco, LLC for $1,014,000 through the Company's wholly-owned subsidiary, IVP FL Holding Company, LLC. This acquisition was financed by a loan provided by WealthSouth for a total of $817,135.

*Lytle Veterinary Clinic*

On March 15, 2022, the Company acquired the veterinary practice and related assets of Lytle Veterinary Clinic in Texas from Lytle Veterinary Clinic, Inc. for $662,469 through the Company's wholly-owned subsidiary IVP Texas Holding Company, LLC and its wholly-owned subsidiary, IVP Texas Managing Co., LLC. Simultaneously, the Company acquired the real estate operations, consisting of land and buildings, utilized by the Lytle practice for $780,000 from the Lytle practice through the Company's wholly-owned subsidiary, IVP Texas Properties, LLC. This acquisition was financed by two loans provided by WealthSouth for a total of $1,141,098.

*Southern Kern Veterinary Clinic*

On March 22, 2022, the Company acquired the veterinary practice and related assets of Southern Kern Veterinary Clinic in California from Southern Kern Veterinary Clinic, Inc. for $1,500,000 through the Company's wholly-owned subsidiary IVP CA Holding Co., LLC and its wholly-owned subsidiary, IVP Texas Managing Co., LLC. Simultaneously, the real estate operations, consisting of land and buildings,) utilized by the Kern practice was purchased for $500,000 through the Company's wholly-owned subsidiary, IVP CA Properties, LLC. This acquisition was financed by two loans provided by WealthSouth for a total of $1,700,000.

*Bartow Animal Clinic*

 

On May 18, 2022, the Company acquired the veterinary practice and related assets of Bartow Animal Clinic in Bartow, Florida from Winter Park Veterinary Clinic, Inc. for $1,055,000 through the Company's wholly-owned subsidiary IVP FL Holding Company LLC. Simultaneously, the real estate operations, consisting of land and buildings, utilized by the Bartow practice was purchased for $350,000 through the Company's wholly-owned subsidiary, IVP CA Properties, LLC. This acquisition was financed by two loans provided by WealthSouth for a total of $969,000.

*Dietz Family Pet Hospital*

 

On June 15, 2022, the Company acquired the veterinary practice and related assets of Dietz Family Pet Hospital in Richmond, Texas from Dietz Family Pet Hospital, P.A. for $500,000 through the Company's wholly-owned subsidiary IVP Texas Holding Company LLC and its wholly-owned subsidiary, IVP Texas Managing Co. LLC. This acquisition was financed by a loan provided by WealthSouth for a total of $382,500.

*Aberdeen Veterinary Clinic*

 

On July 29, 2022, the Company acquired the veterinary practice and related assets of Aberdeen Veterinary Clinic in Aberdeen, Maryland from Fritz Enterprises, Inc. for $574,683 through the Company's wholly-owned subsidiary IVP MD Holding Company LLC. This acquisition was financed by a loan provided by WealthSouth for a total of $445,981.

*All Breed Pet Care Veterinary Clinic*

 

On August 12, 2022, the Company acquired the veterinary practice and related assets of All Breed Pet Care veterinary clinic in Newburgh, Indiana from Tejal Rege for $952,000 through the Company's wholly-owned subsidiary IVP IN Holding Company LLC. Simultaneously, the real estate operations, consisting of land and buildings, utilized by the All Breed practice was purchased for $1,200,000 through the Company's wholly-owned subsidiary, IVP IN Properties, LLC. This acquisition was financed by three loans provided by WealthSouth for a total of $1,945,450.

*Pony Express Veterinary Hospital*

 

On October 31, 2022, the Company acquired the veterinary practice and related assets of the Pony Express Veterinary Hospital, Inc. in Xenia, Ohio from Pony Express Veterinary Hospital, Inc. for $2,608,652 through the Company's wholly-owned subsidiary IVP OH Holding Company, LLC. Simultaneously, the real estate operations, consisting of land and buildings, utilized by the Pony Express Veterinary Hospital practice was purchased for $500,000 through the Company's wholly-owned subsidiary, IVP OH Properties, LLC. This acquisition was financed by three loans provided by First Southern National Bank for a total of $2,853,314.

*Williamsburg Animal Clinic*

On December 9, 2022, the Company acquired the veterinary practice and related assets of Williamsburg Veterinary Clinic in Williamsburg, MA from Williamsburg Animal Clinic, LLC for $850,000 through the Company's wholly owned subsidiary, IVP MA Holding Company, LLC. This acquisition was financed by a loan provided by WealthSouth for a total of $637,500.

*The Old 41 Animal Hospital*

On December 16, 2022, the Company acquired the veterinary practice and related assets of The Old 41 Veterinary Clinic in Bonita Springs, FL from The Old 41 Animal Hospital, LLC for $665,000 through the Company's wholly owned subsidiary, IVP FL Holding Company, LLC. Simultaneously, the real estate operations consisting of land and building utilized by the Old 41 practice for $800,000 from Scott A. Gregory DVM, LLC through the Company's wholly owned subsidiary, IVP FL Properties, LLC. This acquisition was financed by two loans provided by First Southern National Bank for a total of $1,208,000.

*Valley Veterinary Service Acquisition*

On November 8, 2023, the Company acquired the animal hospital and related assets of Valley Veterinary Service, Inc in Rostraver Township, Pennsylvania for $800,000 in cash, a holdback agreement for $200,000 in cash that may be paid out at the end of the two year period following the acquisition based on continued employment by the two former owners and revenue targets for year 1 and year 2 following the effective date of the acquisition, which is not included in the consideration transferred, and issuance of restricted shares of the Company's Class A common stock equal to $400,000 through the Company's wholly owned subsidiary IVP PA Holding Company, LLC. Simultaneously, the Company acquired the real estate operations consisting of land and building utilized by Valley Veterinary Services, Inc animal hospital for $590,000 from the owners of Valley Veterinary Services, Inc through the Company's wholly owned subsidiary, IVP PA Properties, LLC. This acquisition was financed by one loan provided by First Southern National Bank for $375,000 and one loan provided by Farmers National Bank of Danville for $850,000.

*Debary Animal Clinic*

 

On June 4, 2025, the Company acquired the animal clinic and related assets of DeBary Animal Clinic in DeBary, Florida for $1,850,000 in cash, a holdback agreement for $114,500 in cash that may be paid out at the end of the two year period following the acquisition based on continued employment by the former owner and revenue targets for year 1 and year 2 following the effective date of the acquisition, which is not included in the consideration transferred, and issuance of restricted shares of the Company's Class A common stock equal to $92,500 through the Company's wholly owned subsidiary IVP FL Holding Company, LLC. Simultaneously, the Company acquired the real estate operations consisting of land and building utilized by DeBary Animal Clinic for $1,132,000 from the owner of DeBary Animal Clinic through the Company's wholly owned subsidiary, IVP FL Properties, LLC. This acquisition was financed by one loan provided by Ushjo or $780,000.

**Comparability of Our Results of Operations**

*Results of Operations for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024:*

**Summary of Results of Operations**

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended<br> September 30,** | **For the Nine Months Ended<br> September 30,** |
|  | **2025** | **2024** |
| Service revenue | $9074965 | $9735585 |
| Product revenue | 3163910 | 3535388 |
| &nbsp;&nbsp;&nbsp;Total revenue | 12238875 | 13270973 |
| Operating expenses |  |  |
| &nbsp;&nbsp;&nbsp;Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 7253536 | 7705972 |
| &nbsp;&nbsp;&nbsp;Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 2507227 | 2807025 |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | 7514420 | 8080199 |
| &nbsp;&nbsp;&nbsp;Debt extinguishment loss | 689411 | 1587862 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 864293 | 1048290 |
| &nbsp;&nbsp;&nbsp;Gain on sale of business | - | (467049) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 18828887 | 20762299 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss from operations | (6590012) | (7491326) |
| Other income (expenses): |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 25 | 46 |
| &nbsp;&nbsp;&nbsp;Interest expense | (1385891) | (2801491) |
| &nbsp;&nbsp;&nbsp;Other income (expenses) | - | (4768) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expenses | (1385866) | (2806213) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss before income taxes | (7975878) | (10297539) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Benefit for income taxes | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | (7975878) | (10297539) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend on convertible series A preferred stock | - | (220850) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss attributable to class A and B common stockholders | $(7975878) | $(10518389) |
| &nbsp;&nbsp;&nbsp;Net loss per Class A and B common shares: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | $(1.55) | $(2.64) |
| &nbsp;&nbsp;&nbsp;Weighted average shares outstanding per Class A and B common shares: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | 5154703 | 3989343 |

---

**Revenue**

The following table presents the breakdown of revenue between products and services:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Nine Months Ended** | **For the Nine Months Ended** | **September 30, 2025 vs. <br> September 30, 2024** | **September 30, 2025 vs. <br> September 30, 2024** |
|  | **September 30,<br> 2025** | **September 30,<br> 2024** | **$ Change** | **% <br> Change** |
| Revenue: |  |  |  |  |
| Service Revenue | $9074965 | $9735585 | $(660620) | -7% |
| *Percentage of revenue* | 74% | 73% |  |  |
| Product Revenue | 3163910 | 3535388 | (371478) | -11% |
| *Percentage of revenue* | 26% | 27% |  |  |
| Total | $12238875 | $13270973 | $(1032098) | -8% |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Average Daily Service Revenue for the Nine Months Ended** | **Average Daily Service Revenue for the Nine Months Ended** | **September 30, 2025 vs. <br> September 30, 2024** | **September 30, 2025 vs. <br> September 30, 2024** |
| <br>**Animal Hospital & Clinics** | **September 30,<br> 2025** | **September 30,<br> 2024** | **$ Change** | **% <br> Change** |
| Kauai Veterinary Clinic<sup>1</sup> | $- | $3791 | $(3791) | -100% |
| Chiefland Animal Hospital | 1625 | 1634 | (8) | 0% |
| Pets & Friends Animal Hospital | 4477 | 3847 | 630 | 16% |
| Advanced Veterinary Care of Pasco | 2313 | 1938 | 375 | 19% |
| Lytle Veterinary Clinic | 1576 | 1822 | (246) | -13% |
| Southern Kern Veterinary Clinic | 3947 | 3701 | 208 | -7% |
| Bartow Animal Clinic | 2106 | 1898 | (169) | 11% |
| Dietz Family Pet Hospital | 1375 | 1544 | (484) | -37% |
| Aberdeen Veterinary Clinic | 827 | 1311 | 231 | -37% |
| All Breed Pet Care Veterinary Clinic | 3047 | 2816 | (96) | 8% |
| Pony Express Veterinary Hospital | 3616 | 3712 | (166) | -3% |
| Williamsburg Animal Clinic | 2185 | 2352 | (550) | -7% |
| Old 41 Animal Hospital | 905 | 1455 | 268 | -38% |
| Valley Veterinary Services Animal Hospital | 3978 | 3710 | 266 | 7% |
| DeBary Animal Clinic<sup>2</sup> | 2896 | - | 2896 | 100% |
| &nbsp;&nbsp;&nbsp;Total Daily Service Revenue | $31979 | $35531 | $(3552) |  |

---

1. The veterinary practice was sold effective September 20, 2024.

2. The veterinary practice was acquired on June 5, 2025.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Average Daily Product<br> Revenue for the <br> Nine Months Ended** | **Average Daily Product<br> Revenue for the <br> Nine Months Ended** | **September 30, 2025 vs.<br> September 30, 2024** | **September 30, 2025 vs.<br> September 30, 2024** |
| <br>**Animal Hospital & Clinics** | **September 30,<br> 2025** | **September 30,<br> 2024** | **$ Change** | **% <br> Change** |
| Kauai Veterinary Clinic<sup>1</sup> | $- | $1327 | $(1327) | -100% |
| Chiefland Animal Hospital | 1224 | 1039 | 186 | 18% |
| Pets & Friends Animal Hospital | 1269 | 1145 | 124 | 11% |
| Advanced Veterinary Care of Pasco | 662 | 528 | 134 | 25% |
| Lytle Veterinary Clinic | 822 | 937 | (115) | -12% |
| Southern Kern Veterinary Clinic | 813 | 765 | 47 | 6% |
| Bartow Animal Clinic | 951 | 998 | (47) | -5% |
| Dietz Family Pet Hospital | 455 | 625 | (169) | -27% |
| Aberdeen Veterinary Clinic | 332 | 534 | (202) | -38% |
| All Breed Pet Care Veterinary Clinic | 818 | 831 | (14) | -2% |
| Pony Express Veterinary Hospital | 1602 | 1501 | 101 | 7% |
| Williamsburg Animal Clinic | 557 | 727 | (170) | -23% |
| Old 41 Animal Hospital | 392 | 483 | (91) | -19% |
| Valley Veterinary Services Animal Hospital | 1201 | 1464 | (263) | -18% |
| DeBary Animal Clinic<sup>2</sup> | 1131 | - | 1131 | 100% |
| &nbsp;&nbsp;&nbsp;Total Daily Product Revenue | $11097 | $12903 | $(1806) |  |

---

1. The veterinary practice was sold effective September 20, 2024.

2. The veterinary practice was acquired on June 5, 2025.

**Revenue in General:** The Company believes the breakdown of gross revenue into service revenue and product revenue categories produces meaningful measures to Company management and the Company's investors in light of the Company's objective to protect the service channel and derive the majority of its revenue from services and expertise which are not capable of disruption from other channels. To achieve this objective, the Company seeks to match the industry target metric of 70% to 80% of gross revenue being derived from services: examination fees, diagnostics fees, laboratory work, surgery and others veterinary services. The Company believes these service revenue sources require veterinary professionals to preside over care delivery and, unlike some veterinary care products, cannot be replaced or sold by other non-veterinary hospital channels such as retail (including over-the-counter and online). Accordingly, the Company views products such as parasite controls, veterinary nutrition products and additives as important, but the Company does not rely on product revenue to account for more than 20% to 30% of gross revenue. Medications and therapeutics which only a licensed veterinary doctor or licensed technician can administer, while still making up part of the 20% to 30% of gross revenue, are less easily diverted to non-veterinary hospital channels as they require licensed professionals to prescribe or utilize them.

The Company uses these percentages in concert with metrics such as Revenue Per Patient Per day ("RPP") and Average Patient Charge ("APC") to analyze the comprehensive nature of diagnostics and services provided by each veterinary hospital. Sometimes referred to as "quality medicine" metrics within the veterinary service industry, the Company uses RPP and APC to determine how a doctor's time is being utilized (inclusive of all diagnostics and therapies). RPP and APC metrics are consolidated into the presentation of average daily service revenue and average daily product revenue. The Company believes these analyses help the Company ensure that its caseload is revenue positive to avoid clinicians spending time on patient work which underutilizes their time and erodes labor profitability. The Company also believes these metrics are useful to investors and potential investors to compare the Company's service-to-product revenue mix against generally accepted industry targets and specific veterinary care service provider competitors.

The services revenue and product revenue metrics are measured in dollars as calculated by the practice management software we provide to each of our clinics to track medical notes, treatment plans, services and products prescribed and provided, as well as to manage invoicing related to all of the above. Reports are generated which allow Company management to view each of these as line-items as well as measure the ratio of service revenue versus product revenue within our revenue mix.

The Company believes the ratio metric is useful for management and its investors for several reasons:

● The Company and its medical leadership teach and enable its medical staff to provide comprehensive medical care which is appropriate for each animal patient. For example, charges to a client which skew too heavily toward products and do not include necessary services may be an indicator that medical cases are not being fully diagnosed using an appropriate standard of available and appropriate diagnostics and care. This broad analysis can indicate that more questions should be asked about how cases are managed by certain providers, particularly if patterns emerge;

● Comprehensive care for pets means physical exams, dental care, blood work and many other service related line-items. An overreliance on product revenue alone (which products may be available over-the-counter outside of the veterinary channel) leaves veterinary clinics susceptible to sales transfer to other channels. In addition, appropriate veterinary care (as defined by market practice and some state licensing boards) does not include prescribing products without the delivery of diagnostic and care services.

● Advancements in veterinary care within the last decade such as anesthetic protocols, pain management, fear free medicine and other services have shown great efficacy for the betterment of patients and their recovery from illness or surgeries. The absence of certain services and procedures within, for instance, a surgery package for a patient, would indicate an opportunity to improve outcomes for a patient and extend life expectancy. These are positive outcomes for clients and, therefore, of interest and value to the Company and our investors.

**Service Revenues:** The Company recognizes service revenue from health exams, pet grooming, veterinary care, and certain other services performed at our animal hospitals or clinics and is recognized once the service is completed, as this is when the customer has the ability to direct the use of and obtain the benefits of the services. Payment terms are at the point of sale but may also occur upon completion of the service. Service revenue decreased $660,620 or 7%, to $9,074,965 for the nine months ended September 30, 2025 as compared to $9,735,585 for the nine months ended September 30, 2024. The decrease in service revenue is mainly attributed to the exclusion of KVC from 2025 results offset by results from DeBary animal clinic that was acquired in Q2 2025.

**Product Revenues:** Product revenue is recognized when control passes, which occurs at a point in time when the customer completes a transaction at our animal hospitals or clinics and receives the product. Product revenue decreased $371,478, or 11%, to $3,163,910 for the nine months ended September 30, 2025 as compared to $3,535,388 for the nine months ended September 30, 2024. The overall decrease was a result of customers purchasing less products per visit and the exclusion of KVC from 2025 results offset by results from DeBary animal clinic that was acquired in Q2 2025.

**Cost of service revenue (exclusive of depreciation and amortization):** Cost of service revenue consists of cost directly related to the animal services provided at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, laboratory costs, pet supply costs, third-party veterinarian contractors, office rent, utilities, supplies, and other cost arising as a result of the services being performed, excluding depreciation and amortization. Cost of service revenue decreased $452,436, or 6%, to $7,253,536 for the nine months ended September 30, 2025 as compared to $7,705,972 for the nine months ended September 30, 2024. The decrease in cost of service revenue excluding depreciation and amortization was driven primarily by the decrease in service revenue due to the exclusion of KVC from 2025 results. These decreases were offset by results from DeBary animal clinic that was acquired in Q2 2025.

**Cost of product revenue (exclusive of depreciation and amortization):** Cost of product revenue consists of cost directly related to the product sales at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, purchase price of the medication we dispense, and purchase price of product sold, excluding depreciation and amortization. Cost of product revenue decreased $299,768, or 11%, to $2,507,227 for the nine months ended September 30, 2025 as compared to $2,807,025 for the nine months ended September 30, 2024. The decrease in cost of product revenue was driven primarily by a decrease in product revenue due to the exclusion of KVC from 2025 results. These decreases were offset by results from DeBary animal clinic that was acquired in Q2 2025.

**General and Administrative Expense:** General and administrative expenses include personnel-related compensation costs for corporate employees, such as management, accounting, legal, acquisition related and non-recurring expenses, insurance and other expenses used to operate the business. General and administrative expenses decreased $565,779, or 7% to $7,514,420 for the nine months ended September 30, 2025 as compared to $8,080,199 for the nine months ended September 30, 2024. The decrease was primarily due to decreases in expenses from the investor relations agency contracts and marketing agreements the Company entered into during the first quarter of 2024 following the February 2024 public stock offering. These decreases were offset by increased consulting agreements relating to customer outreach and operations improvements.

**Depreciation and Amortization Expense:** Depreciation and amortization expense mainly relates to the assets used in generating revenue. Depreciation and amortization expense decreased $183,997, or 18%, to $864,293 for the nine months ended September 30, 2025 as compared to $1,048,290 for the nine months ended September 30, 2024. The decrease was primarily due to the sale of KVC during Q3 2024.

**Other Expense:** Other expense is composed primarily of interest expense and small denomination bank fee charges. Other expense decreased $1,420,347, or 51%, to $1,385,866 for the nine months ended September 30, 2025 as compared to $2,806,213 for the nine months ended September 30, 2024. The decrease was primarily due to the decrease in the financing arrangements to fund working capital at a very high effective interest rate as compared to the Company's term loans.

**Net Loss:** Net Loss decreased $2,321,661, or 23%, to $7,975,878 for the nine months ended September 30, 2025 as compared to $10,297,539 for the nine months ended September 30, 2024. The reduction of the net loss is primarily attributable to the decline in interest expense and the exclusion of the operating expenses associated with KVC.

**Comparability of Our Results of Operations**

*Results of Operations for the three months ended September 30, 2025 compared to the three months ended September 30, 2024:*

**Summary of Results of Operations**

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| | | |
|:---|:---|:---|
|  | **For the Three Months Ended <br> September 30,** | **For the Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| Service revenue | $3138670 | $2969748 |
| Product revenue | 1177462 | 1079277 |
| &nbsp;&nbsp;&nbsp;Total revenue | 4316132 | 4049025 |
| Operating expenses |  |  |
| &nbsp;&nbsp;&nbsp;Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 2678940 | 2568085 |
| &nbsp;&nbsp;&nbsp;Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 850153 | 854921 |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | 2423707 | 2988122 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 330498 | 340167 |
| &nbsp;&nbsp;&nbsp;Gain on sale of business | - | (467049) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 6283298 | 6284246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss from operations | (1967166) | (2235221) |
| Other income (expenses): |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 4 | 44 |
| &nbsp;&nbsp;&nbsp;Interest expense | (559111) | (1254149) |
| &nbsp;&nbsp;&nbsp;Other income (expenses) | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expenses | (559108) | (1254105) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss before income taxes | (2526273) | (3489326) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Benefit for income taxes | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | (2526273) | (3489326) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend on convertible series A preferred stock | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss attributable to class A and B common stockholders | $(2526273) | $(3489326) |
| &nbsp;&nbsp;&nbsp;Net loss per Class A and B common shares: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | $(0.41) | $(0.85) |
| &nbsp;&nbsp;&nbsp;Weighted average shares outstanding per Class A and B common shares: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | 6091057 | 4112531 |

---

**Revenue**

The following table presents the breakdown of revenue between products and services:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** | **September 30, 2025 vs. <br> September 30, 2024** | **September 30, 2025 vs. <br> September 30, 2024** |
|  | **September 30,<br> 2025** | **September 30,<br> 2024** | **$ Change** | **% <br> Change** |
| Revenue: |  |  |  |  |
| Service Revenue | $3138670 | $2969748 | $168922 | 6% |
| *Percentage of revenue* | 73% | 73% |  |  |
| Product Revenue | 1177462 | 1079277 | 98185 | 9% |
| *Percentage of revenue* | 27% | 27% |  |  |
| Total | $4316132 | $4049025 | $267107 | 7% |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Average Daily Service<br> Revenue for the <br> Three Months Ended** | **Average Daily Service<br> Revenue for the <br> Three Months Ended** | **September 30, 2025 vs. <br> September 30, 2024** | **September 30, 2025 vs. <br> September 30, 2024** |
| <br>**Animal Hospital & Clinics** | **September 30,<br> 2025** | **September 30,<br> 2024** | **$ Change** | **% <br> Change** |
| Kauai Veterinary Clinic<sup>1</sup> | $- | $3472 | $(3472) | -100% |
| Chiefland Animal Hospital | 1573 | 1408 | 165 | 12% |
| Pets & Friends Animal Hospital | 4505 | 3212 | 1293 | 40% |
| Advanced Veterinary Care of Pasco | 2348 | 1637 | 711 | 43% |
| Lytle Veterinary Clinic | 1545 | 1565 | (19) | -1% |
| Southern Kern Veterinary Clinic | 4318 | 3333 | 984 | 30% |
| Bartow Animal Clinic | 2068 | 1642 | 426 | 26% |
| Dietz Family Pet Hospital | 1033 | 1532 | (499) | -33% |
| Aberdeen Veterinary Clinic | 734 | 1139 | (404) | -36% |
| All Breed Pet Care Veterinary Clinic | 2930 | 2750 | 180 | 7% |
| Pony Express Veterinary Hospital | 3439 | 3386 | 53 | 2% |
| Williamsburg Animal Clinic | 2314 | 2208 | 105 | 5% |
| Old 41 Animal Hospital | 674 | 969 | (295) | -30% |
| Valley Veterinary Services Animal Hospital | 3902 | 4027 | (125) | -3% |
| DeBary Animal Clinic<sup>2</sup> | 2.733 | - | 2733 | 100% |
| &nbsp;&nbsp;&nbsp;Total Daily Service Revenue | $31383 | $32280 | $(897) |  |

---

1. The veterinary practice was sold effective September 20, 2024.

2. The veterinary practice was acquired on June 5, 2025.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Average Daily Product<br> Revenue for the <br> Three Months Ended** | **Average Daily Product<br> Revenue for the <br> Three Months Ended** | **September 30, 2025 vs. <br> September 30, 2024** | **September 30, 2025 vs. <br> September 30, 2024** |
| <br>**Animal Hospital & Clinics** | **September 30,<br> 2025** | **September 30,<br> 2024** | **$ Change** | **% <br> Change** |
| Kauai Veterinary Clinic<sup>1</sup> | $- | $1108 | $(1108) | -100% |
| Chiefland Animal Hospital | 1295 | 908 | 386 | 43% |
| Pets & Friends Animal Hospital | 1341 | 1017 | 323 | 32% |
| Advanced Veterinary Care of Pasco | 751 | 459 | 292 | 63% |
| Lytle Veterinary Clinic | 879 | 799 | 80 | 10% |
| Southern Kern Veterinary Clinic | 853 | 761 | 92 | 12% |
| Bartow Animal Clinic | 946 | 866 | 80 | 9% |
| Dietz Family Pet Hospital | 417 | 540 | (123) | -23% |
| Aberdeen Veterinary Clinic | 383 | 454 | (71) | -16% |
| All Breed Pet Care Veterinary Clinic | 885 | 840 | 44 | 5% |
| Pony Express Veterinary Hospital | 1768 | 1624 | 144 | 9% |
| Williamsburg Animal Clinic | 676 | 697 | (21) | -3% |
| Old 41 Animal Hospital | 390 | 330 | 59 | 18% |
| Valley Veterinary Services Animal Hospital | 1180 | 1327 | (147) | -11% |
| DeBary Animal Clinic<sup>2</sup> | 1035 | - | 1035 | 100% |
| &nbsp;&nbsp;&nbsp;Total Daily Product Revenue | $11763 | $11731 | $32 |  |

---

1. The veterinary practice was sold effective September 20, 2024.

2. The veterinary practice was acquired on June 5, 2025.

**Service Revenues:** The Company recognizes service revenue from health exams, pet grooming, veterinary care, and certain other services performed at our animal hospitals or clinics and is recognized once the service is completed, as this is when the customer has the ability to direct the use of and obtain the benefits of the services. Payment terms are at the point of sale but may also occur upon completion of the service. Service revenue increased $168,922 or 6%, to $3,138,670 for the three months ended September 30, 2025 as compared to $2,969,748 for the three months ended September, 2024. The increase in service revenue is mainly attributed to the general increase in spend, specifically per visit spend.

**Product Revenues:** Product revenue is recognized when control passes, which occurs at a point in time when the customer completes a transaction at our animal hospitals or clinics and receives the product. Product revenue increased $98,185, or 9%, to $1,177,462 for the three months ended September 30, 2025 as compared to $1,079,277 for the three months ended September 30, 2024. The overall increase was a result of customers purchasing more products per visit.

**Cost of service revenue (exclusive of depreciation and amortization):** Cost of service revenue consists of cost directly related to the animal services provided at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, laboratory costs, pet supply costs, third-party veterinarian contractors, office rent, utilities, supplies, and other cost arising as a result of the services being performed, excluding depreciation and amortization. Cost of service revenue increased $110,855, or 4%, to $2,678,940 for the three months ended September 30, 2025 as compared to $2,568,085 for the three months ended September 30, 2024. The increase in cost of service revenue sold excluding depreciation and amortization was driven primarily by the increase in service revenue due to higher spend.

**Cost of product revenue (exclusive of depreciation and amortization):** Cost of product revenue consists of cost directly related to the product sales at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, purchase price of the medication we dispense, and purchase price of product sold, excluding depreciation and amortization. Cost of product revenue decreased $4,768, or 1%, to $850,153 for the three months ended September 30, 2025 as compared to $854,921 for the three months ended September 30, 2024. The decrease in cost of product revenue was driven primarily by a decrease in product costs with improved pricing at the corporate level and improved ordering guidelines.

**General and Administrative Expense:** General and administrative expenses include personnel-related compensation costs for corporate employees, such as management, accounting, legal, acquisition related and non-recurring expenses, insurance and other expenses used to operate the business. General and administrative expenses decreased $564,415, or 19% to $2,423,707 for the three months ended September 30, 2025 as compared to $2,988,122 for the three months ended September 30, 2024. The decrease is primary due to decreased consulting agreements relating to customer outreach and credit card processing fees.

**Depreciation and Amortization Expense:** Depreciation and amortization expenses mainly relate to the assets used in generating revenue. Depreciation and amortization expense decreased $9,669, or 3%, to $330,498 for the three months ended September 30, 2025 as compared to $340,167 for the three months ended September 30, 2024. The decrease was primarily due to the sale of KVC during Q3 2024.

**Other Expense:** Other expenses are composed primarily of interest expenses and small denomination bank fee charges. Other expenses decreased $694,998, or 55%, to $559,108 for the three months ended September 30, 2025 as compared to $1,254,149 for the three months ended September 30, 2024. The decrease was primarily due to the decrease in the financing arrangements to fund working capital at a very high effective interest rate as compared to the Company's term loans.

**Net Loss:** Net Loss decreased $963,053, or 28%, to $2,526,273 for the three months ended September 30, 2025 as compared to $3,489,326 for the three months ended September 30, 2024. The reduction of the net loss is primarily attributable to the decline in interest expense and the exclusion of the operating expenses associated with KVC.

**Liquidity and Capital Resources**

Since inception, we have financed our operations from a combination of:

● issuances and sales of senior convertible notes;

● issuance of convertible debentures;

● borrowings under other debt consisting of: (i) a principal lending relationship with Farmers National Bank of Danville; (ii)a principal lending relationship with First Southern National Bank; (iii) short term financing arrangements under merchant cash advance agreement;

● proceeds from issuance of equity; and

● cash generated from operations.

The Company has experienced operating losses since its inception and had a total accumulated deficit of $44,326,159 as of September 30, 2025. The Company expects to incur additional costs and require additional capital as the Company continues to acquire additional veterinary hospitals, clinics and practices. During the nine months ended September 30, 2025 the Company's cash used in operations was $3,598,738.

The Company's primary short-term cash requirements are to fund working capital, lease obligations and short-term debt, including current maturities of long-term debt. Working capital requirements can vary significantly from period to period, particularly as a result of additional business acquisitions. The Company's medium-term to long-term cash requirements are to service and repay debt, to expand through acquisitions, and to invest in facilities and equipment for growth initiatives.

The Company's ability to fund its cash needs will depend, in part, on its ability to generate cash in the future, which depends on future financial results. The Company's future results are subject to general economic, financial, competitive, legislative and regulatory factors that may be outside of our control. The Company's future access to, and the availability of credit on acceptable terms and conditions, is impacted by many factors, including capital market liquidity and overall economic conditions.

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring losses and as of September 30, 2025, had an accumulated deficit and negative working capital of $44,326,159 and 5,894,301, respectively. For the three and nine months ended September 30, 2025, the Company sustained a net loss of $2,526,273 and $7,975,878, respectively. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern for the next twelve months from the date these financial statements were issued. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is contingent upon its ability to obtain additional financing and to generate revenue and cash flow to meet its obligations on a timely basis. The Company will continue to seek to raise additional funding through debt or equity financing during the next twelve months. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving these objectives.

We cannot be sure that future funding will be available to us on acceptable terms, or at all. Due to often volatile nature of the financial markets, equity and debt financing may be difficult to obtain.

We may seek to raise any necessary additional capital through a combination of private or public equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing and distribution arrangements. To the extent that we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights or future revenue streams on terms that may not be favorable to us. If we raise additional capital through private or public equity offerings, the ownership interest of our existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders' rights. If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

As of the date of this filing, the Company was in compliance with all covenants and restrictions associated with our debt agreements. The Company is not aware of any instances of breaches or non-compliance with its covenants and commitments under its debt agreements.

**Master Lending and Credit Facility**

On June 25, 2021, the Company entered into a master line of credit loan agreement ("MLOCA") with Wealth South a division of Farmers National Bank of Danville, Kentucky ("FNBD"). The MLOCA provides for a $2,000,000 revolving secured credit facility ("Revolving Line") to be drawn for the initial purchase of veterinary clinical practices ("Practices") and a $8,000,000 closed end line of credit ("Closed End Line") to be disbursed as individual loans (Term Loans) to paydown draws on the Revolving Line and to provide longer term financing of the purchase of Practices. Each draw on the Revolving Line shall be repaid with a Term Loan out of the Closed End Line within one hundred and twenty (120) days of the draw on the Revolving Line. Each draw on the Revolving Line and the Closed End Line shall not exceed eighty-five (85%) percent of the purchase price of the Practice. The Company shall contribute and maintain equity of a minimum of fifteen (15%) percent of the initial purchase price of a Practice as long as any draw on the Revolving Line or a Term Loan remains unpaid with FNBD. The Revolving Line has an interest rate equal to the New York Prime Rate plus 0.50% that shall never be less than 3.57%. Each Term Loan issued under the Closed End Line shall have a fixed interest rate of 3.98% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest rate will equal to the New York Prime Rate plus 0.65% that shall never be less than 3.57%. Each Practice to be acquired must have a minimum projected debt-service coverage ratio ("DSCR") of 1.0x, defined as earnings before interest depreciation and amortization ("EBIDA")/Annual Debt Service Requirement.

Under the MLOCA the Term Loans to acquire a Practice shall not exceed 10 years. The first twelve months of the Term Loan may be interest only. Thereafter, the Loan will convert to an amortizing loan with monthly principal and interest payments. For Practice only Term Loans ("Practice Term Loans"), after the initial twelve-month interest only period, the balance will amortize over 9 years. For Loans made to purchase real property ("RE Term Loans"), after the initial twelve-month interest only period, the balance will amortize over a 19-year period.

There is no prepayment penalty on payments on the Revolving Line. The Term Loans are subject to a refinance fee of 2% of the then outstanding principal balance of the Term Loan if paid within two years of entering into the Term Loan and 1% of the then outstanding principal balance of the Term Loan if paid within three to five years of entering into the Term Loan. The refinance fee is due only if the Term Loan is paid off by refinancing. Borrowings under the MLOCA are guaranteed by Kimball Carr, CEO & President of the Company.

Effective August 18, 2022, the MLOCA was amended such that the interest rate charge on all sums advanced under the amended and restated MLOCA shall be 5.25% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest will be equal to the New York Prime Rate plus 0.65% that shall never be less than 4.75%. The MLOCA has been fully drawn against.

Notes payable to FNBD as of September 30, 2025 and December 31, 2024 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **September 30,**<br>**2025** | **December 31,**<br>**2024** | **Issuance**<br>**Cost** |
| $237272 | CAH | 12/27/2021 | 12/27/2041 | 3.98% | $212213 | $219975 | $6108 |
| 231987 | CAH | 12/27/2021 | 12/27/2031 | 3.98% | 168930 | 187461 | 6108 |
| 216750 | P&F | 12/27/2021 | 12/27/2041 | 3.98% | 193858 | 200949 | 5370 |
| 318750 | P&F | 12/27/2021 | 12/27/2031 | 3.98% | 232110 | 257571 | 5370 |
| 817135 | Pasco | 1/14/2022 | 1/14/2032 | 3.98% | 602050 | 667050 | 3085 |
| 478098 | Lytle | 3/15/2022 | 3/15/2032 | 3.98% | 362271 | 398275 | 1898 |
| 663000 | Lytle | 3/15/2022 | 3/15/2042 | 3.98% | 602050 | 621020 | 11875 |
| 425000 | Kern | 3/22/2022 | 3/22/2042 | 3.98% | 385929 | 398089 | 7855 |
| 1275000 | Kern | 3/22/2022 | 3/22/2032 | 3.98% | 966107 | 1062126 | 4688 |
| 246500 | Bartow | 5/18/2022 | 5/18/2042 | 3.98% | 224497 | 232428 | 5072 |
| 722500 | Bartow | 5/18/2022 | 5/18/2032 | 3.98% | 556980 | 613737 | 2754 |
| 382500 | Dietz | 6/15/2022 | 6/15/2032 | 3.98% | 298128 | 328026 | 1564 |
| 445981 | Aberdeen | 7/19/2022 | 7/29/2032 | 3.98% | 352980 | 386120 | 1786 |
| 1020000 | All Breed | 8/12/2022 | 8/12/2042 | 3.98% | 942476 | 971173 | 8702 |
| 519527 | All Breed | 8/12/2022 | 8/12/2032 | 3.98% | 415513 | 453984 | 3159 |
| 225923 | All Breed | 8/12/2022 | 8/12/2032 | 5.25% | 182828 | 198905 | 3159 |
| 637500 | Williamsburg | 12/8/2022 | 12/8/2032 | 5.25% | 536269 | 580834 | 2556 |
| 850000 | Valley Vet | 11/8/2023 | 11/8/2033 | 5.25% | 783340 | 843796 | 3315 |
| $9713423 |  |  |  |  | $8018482 | $8621519 | $84424 |

---

The Company amortized $1,560 and $1,560 of issuance costs in the aggregate during the three months ending September 30, 2025 and 2024, respectively. The Company amortized $4,629 and $4,646 of issuance cost in the aggregate during the nine months ending September 30, 2025 and 2024, respectively, for the FNBD notes payable.

**FSB Commercial Loans**

In January 2021, the Company entered into three separate commercial loans with First Southern National Bank ("FSB") as part of the KVC acquisition. The first commercial loan, in the amount of $1,105,000, had a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan had monthly payments of $6,903 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $13,264 that were capitalized and being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024, required the Company to make monthly payments of $9,016 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of KVC. Refer to "Business disposal" above for further detail.

The second commercial loan with FSB, in the amount of $1,278,400, had a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan had monthly payments of $13,157 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $10,085 that were capitalized and being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024, required the Company to make monthly payments of $14,898 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of KVC. Refer to "Business disposal" above for further detail.

The third commercial loan with FSB, in the amount of $450,000, had a fixed interest rate of 5.05% and a maturity date of September 11, 2021. The commercial loan was modified on August 25, 2021 to extend the maturity date to February 25, 2023 and increase the principal amount to $469,914. The fixed rate loan had monthly payments of $27,164 and was fully paid off on the maturity date. The commercial loan had issuance costs of $753 that were capitalized and being amortized straight line over the life of the loan. This loan was paid in full in February 2023.

On October 31, 2022, the Company entered into three separate commercial loans with FSB as part of the Pony Express Practice acquisition. The first loan with FSB was in the amount of $2,086,921. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $23,138 except for a final monthly payment of $1,608,530. The commercial loan had issuance costs of $25,575 that were capitalized and are being amortized straight line over the life of the loan.

The second loan with FSB was in the amount of $400,000. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2042. The fixed rate loan has monthly payments of $2,859. The commercial loan had issuance costs of $3,277 that were capitalized and are being amortized straight line over the life of the loan.

The third loan with FSB was in the amount of $700,000. The loan has a fixed interest rate of 6.75% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $6,903 except for a final monthly payment of $423,278. The commercial loan did not have any issuance costs that were capitalized.

On December 16, 2022, the Company entered into two separate commercial loans with FSB as part of the Old 41 Practice acquisition. The first loan with FSB was in the amount of $568,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has monthly payments of $4,772 and a full payoff of the remaining principal balance at maturity. The loan had issuance costs of $4,531 that were capitalized and are being amortized straight line over the life of the loan.

The second loan with FSB was in the amount of $640,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has twelve monthly payments of approximately $2,830, followed by monthly payments of $7,443. and the interest rate is 6.50%. The loan had issuance costs of $5,077 that were capitalized and are being amortized straight line over the life of the loan.

On November 8, 2023, the Company entered into a commercial loan with FSB as part of the Valley Vet acquisition. The loan with FSB was in the amount of $375,000. The loan has a fixed rate of 8.5% and a maturity date of January 29, 2026. The fixed rate loan has monthly payments of $3,255, except one final payment of the outstanding principal balance on the note, including any accrued and unpaid interest. The loan had issuance costs of $6,877 that were capitalized and are being amortized straight line over the life of the loan.

The FSB commercial loans are guaranteed by Kimball Carr, Chief Executive Officer and President and Charles Stith Keiser, a member of our Board of Directors.

Notes payable to FSB as of September 30, 2025 and December 31, 2024 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **September 30,**<br>**2025** | **December 31,**<br>**2024** | **Issuance**<br>**Cost** |
| $1105000 | KVC | 1/25/2021 | 2/25/2041 | 4.35% | $- | $- | $13264 |
| 1278400 | KVC | 1/25/2021 | 1/25/2031 | 4.35% |  |  | 10085 |
| 469914 | KVC | 1/25/2021 | 2/25/2023 | 5.05% |  |  | 753 |
| 2086921 | Pony Express | 10/31/2022 | 10/31/2025 | 5.97% | 1605591 | 1733807 | 25575 |
| 400000 | Pony Express | 10/31/2022 | 10/31/2042 | 5.97% | 367827 | 375943 | 3277 |
| 700000 | Pony Express | 10/31/2022 | 8/16/2023 | 7.17% |  |  |  |
| 568000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 239320 | 470227 | 4531 |
| 640000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 384465 | 406641 | 5077 |
| 375000 | Valley Vet | 11/8/2023 | 1/29/2026 | 8.50% | 364470 | 375000 | 6877 |
| $7623235 |  |  |  |  | $2961673 | $3361618 | $69439 |

---

The Company amortized $2,995 and $5,146 of issuance cost in the aggregate during the three months ending September 30, 2025 and 2024, respectively. The Company amortized $8,886 and $15,325 of issuance cost in the aggregate during the nine months ending September 30, 2025 and 2024, respectively, for the FSB notes payable.

**Ushjo Commercial Loan**

On June 4, 2025, the Company entered into a commercial loan with Ushjo as part of the DeBary Animal Clinic acquisition. The loan with Ushjo was entered into on June 4, 2025, in the amount of $780,000. The loan has a fixed rate of 11.25% and a maturity date of July 1, 2026. The fixed rate loan has monthly payments for the interest portion of the loan, except one final payment of the outstanding principal balance on the note, including any accrued and unpaid interest.

Notes payable to Ushjo as of September 30, 2025 and December 31, 2024 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **September 30,**<br>**2025** | **December 31,**<br>**2024** | **Issuance**<br>**Cost** |
| $780000 | DeBary | 6/4/2025 | 7/1/2026 | 11.25% | $780000 | $- | $18810 |

---

The Company amortized $4,415 and $0 of issuance cost in the aggregate during the three months ending September 30, 2025 and 2024, respectively. The Company amortized $5,662 and $0 of issuance cost in the aggregate during the nine months ending September 30, 2025 and 2024, respectively, for the Ushjo notes payable.

Notes payable as of September 30, 2025, and December 31, 2024 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| FNBD Notes Payable | $8018480 | $8621519 |
| FSB Notes Payable | 2961673 | 3361618 |
| Ushjo Note Payable | 780000 | - |
| Total notes payable | 11760153 | 11983137 |
| Unamortized debt issuance costs | (81146) | (81909) |
| Notes payable, net of issuance cost | 11679007 | 11901228 |
| Less current portion | (3424599) | (3410465) |
| Long-term portion | $8254408 | $8490763 |

---

Notes payable repayment requirements as of September 30, 2025, in the succeeding years are summarized as follows:

---

| | |
|:---|:---|
| Remainder of 2025 | $2435653 |
| 2026 | 1985045 |
| 2027 | 876805 |
| 2028 | 914210 |
| 2029 | 954785 |
| Thereafter | 4593655 |
| Total | $11760153 |

---

**Convertible Debenture**

Between March 18 and December 28, 2021, the Company issued $2,102,500 in aggregate principal amount of 6.00% subordinated convertible promissory notes ("Convertible Debenture"). During the year ended December 31, 2022, the Company issued $1,612,000 in aggregated principal amount of the Convertible Debenture. In March 2023 the Company issued an additional $650,000 in aggregate principal amount of Convertible Debenture to five (5) separate holders. The Convertible Debenture was convertible into the Company's Class A common stock upon the Company's offering for sale its shares in a initial public offering ("IPO"). At the holder's election, the accrued interest and principal could be paid in cash or Class A common stock (such number of shares reflecting a twenty-five percent (25%) discount to the opening price per share of Class A common stock). The Convertible Debenture matured 5 years from the date of issuance to each holder. Upon an IPO, the accrued and unpaid interest was due and payable in cash on the first business day of the following month for any balance not elected to be converted into the Class A common stock. The Convertible Debenture incurred issuance costs of $40,000 that were amortized straight line over the life of the Convertible Debenture. The Company amortized $0 of issuance cost during the three months ended September 30, 2025 and 2024. The Company amortized $0 for the nine months ending September 30, 2025 and 2024.

Upon the Company's IPO closing on August 31, 2023, the majority of Convertible Debenture holders elected to convert an aggregate of $4,014,500 of principal and $399,818 of accrued interest into 14,953 shares of Class A common stock at a conversion price of $30.00 per share. The Company recorded a beneficial conversion feature as of the date of the conversion of $1,569,395 based on the IPO price of $40 per share minus the principal and accrued interest of the Convertible Debenture balance converted into common stock. Four holders of the Convertible Debenture with an aggregate principal balance of $250,000 elected to be paid back in cash and one investor with a principal balance of $100,000 elected to be paid on February 28, 2024 including accrued interest through the date of payment at 6%. As of September 30, 2025, there is no principal amount of the Convertible Debenture outstanding.

**Loans Payable**

On May 30, 2023, the Company entered into a Merchant Cash Advance Agreement for gross proceeds of $1,050,000 with an unrelated third-party financial institution. Under the terms of the initial agreement, the Company had to pay $57,346 each week for 26 weeks with the first payment due June 6, 2023. The financing arrangement had an effective interest rate of 49%. The financing arrangement included an original issuance discount ("OID") of $441,000 and issuance costs of $50,000. The OID and issuance costs associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and are amortized using the effective interest method.

On August 10, 2023, the Company amended its financing arrangement to borrow an additional $507,460, increasing weekly repayments to $76,071 over 28 weeks. This amendment decreased the effective interest rate to 41%. The modification was evaluated under ASC 470-50 and determined to be a debt extinguishment. As a result, the Company recognized a loss on extinguishment of debt of $441,618, which was recorded in the statement of operations.

On November 28, 2023, the Company amended its financing arrangement to borrow an additional $531,071, decreasing weekly payments to $56,800 over 40 weeks. This amendment increased the effective interest rate to 49%. The modification was deemed a debt extinguishment, resulting in a loss on extinguishment of debt of $485,436, recorded in the statement of operations.

On January 18, 2024, the Company amended its financing arrangement to borrow an additional $549,185, increasing weekly payments to $86,214 over 43 weeks. This amendment increased the effective interest rate to 52%. The modification was accounted for as a debt extinguishment, and the Company recorded a loss on extinguishment of debt of $728,278 in the statement of operations.

On May 7, 2024, the Company amended its financing arrangement to borrow an additional $518,750, increasing weekly payments to $90,229 over 48 weeks. This amendment decreased the effective interest rate to 49%. The modification was treated as a debt extinguishment, resulting in a loss on extinguishment of debt of $859,584, recorded in the statement of operations.

On December 24, 2024, the Company amended its financing arrangement to borrow an additional $513,650, increasing weekly payments to $71,995 over 41 weeks. This amendment decreased the effective interest rate to 43%. The modification was determined to be a debt extinguishment, and the Company recognized a loss on extinguishment of debt of $546,356 in the statement of operations.

On May 20, 2025, the Company amended its financing arrangement to borrow an additional $550,000, increasing weekly payments to $78,500 over 47 weeks. This amendment decreased the effective interest rate to 42%. The modification was accounted for as a debt extinguishment, resulting in a loss on extinguishment of debt of $689,411, recorded in the statement of operations.

On April 4, 2024, the Company entered into a new financing agreement for gross proceeds of $420,000 with a different unrelated third-party financial institution. Under the terms of the agreement, the Company had to pay $21,600 each week for 28 weeks with the first payment due April 8, 2024. The financing arrangement had an effective interest rate of 51%. The financing arrangement included an original issuance discount ("OID") of $184,800 and issuance costs of $20,000. The OID and issuance costs associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and are amortized using the effective interest method. As of September 30, 2025, the financing arrangement has been paid in full, and the original issuance discount and issuance costs have been fully amortized.

During the three and nine months ended September 30, 2025, the Company amortized $389,987 and $923,215 of OID and issuance cost, respectively. The amounts are included in interest expense on the statement of operations. During the three and nine months ended September 30, 2025, the Company made $942,000 and $2,774,400 in payments on the loan payable. The outstanding balance of the loan payable as of September 30, 2025 and December 31, 2024, were $2,057,740 and $2,340,020. The financing arrangement is secured by an interest in virtually all assets of the Company with a first security interest in accounts receivable. The financing arrangements are guaranteed by Kimball Carr, the Company's CEO.

**Convertible Notes Payable**

On March 26, 2024, Inspire entered into a securities purchase agreement with a certain investor, pursuant to which Inspire issued a convertible note payable for $500,000. The convertible note payable had a maturity date of the earlier of December 26, 2024 or the consummation of a capital raise. As of September 30, 2025, the financing arrangement has been paid in full.

On June 11, 2024, Inspire entered into a securities purchase agreement with two investors, pursuant to which Inspire issued each investor a convertible note payable") each for $250,000. The convertible notes payable have a maturity date of the earlier of February 11, 2025 or the consummation of a capital raise. As of September 30, 2025, the financing arrangement has been paid in full.

When outstanding the Convertible Notes Payable contain an original issued discount ("OID") which was: (i) fifteen percent (15%) if the Convertible Notes Payable were satisfied and paid in full on or before the forty-fifth (45th) day after the Original Issue Date (as such term was defined in the Notes), (ii) twenty percent (20%) if the Convertible Notes Payable were satisfied and paid in full after such 45th day but on or before the ninetieth (90th) day after the Original Issue Date, and (iii) thirty percent (30%) after such 90th day. The Convertible Notes Payable could be prepaid at any time prior to the Maturity Date without any penalties.

The Convertible Notes Payable had to be repaid in full from any future capital raises (debt, equity or any other form of capital raise) of Inspire. All of the funds raised had to be used to repay the Convertible Notes Payable until the Convertible Notes Payable were repaid in full.

The Convertible Notes Payable were convertible into shares of common stock of Inspire, in full or in part, at any time after issuance at the discretion of the noteholder at a fixed conversion price of $0.03 per share (the "Fixed Conversion Price").

If the Convertible Notes Payable were not repaid by the Maturity Date the default provisions were as follow: (i) The Face Value (as such term was defined in the Convertible Notes Payable) of the Convertible Notes Payable would increase by 20% (to a 50% OID -- $1,000,000 Face Value); (ii) the conversion price of the Convertible Notes Payable would become convertible at the lower of (a) the Fixed Conversion Price or (b) 20% discount to a 3-Day volume-weighted average price (the "Default Conversion Price").

On May 30, 2025, pursuant to securities purchase agreements, the Company issued Original Issue Discount Notes to two investors in the principal amounts of $204,700 and $92,000, respectively (the "Notes"). The Notes have a maturity date of March 30, 2026 and the proceeds are for general working capital. The Note to Diagonal Lending has a one-time interest payment of $24,564, and an initial payment of $114,632 due on November 30, 2025, with monthly payments of $28,658 due on the 30<sup>th</sup> of every month thereafter until March 30, 2026. The Note to Boot Capital has a one-time interest payment of $11,040, and an initial payment of $51,520 due on November 30, 2025, with monthly payments of $12,880 due on the 30<sup>th</sup> of every month thereafter until March 30, 2026.

The Company has the right to prepay the Notes upon written notice to the lender. After an occurrence of an event of default, as described in the Notes, the Notes shall become immediately due and payable and the Company will pay an amount equal to 150% times the sum of (i) the then outstanding principal amount of the Notes plus (ii) accrued and unpaid interest on the unpaid principal amount, plus (iii) default interest, if any.

The lenders will have the right to convert all or any part of the outstanding and unpaid amount of their Note into shares of the Company's common stock upon the later of 180 days from the issuance date or an event of default, as described in the notes. The conversion price of the Notes is 75% of the market price.

While the Notes remain outstanding, the Company may not, without the lenders' written consent, sell, lease, or otherwise dispose of any significant portion of its assets except in the ordinary course of business.

As of September 30, 2025 the balance of the Convertible Notes Payable was $274,908. During the year ended December 31, 2024 the Company paid off $392,857 of the notes payable and accrued interest and converted $1,357,143 into 226,249 shares of class A common stock.

**Promissory Note**

On June 10, 2025, the Company issued to Target Capital LLC ("Target") a promissory note in the principal amount of $625,000, with an original issue discount of $125,000 such that the purchase price was $500,000 (the "Target Note").

The Target Note shall not exceed the maximum amount of such interest permitted by law to be charged and a maturity date of the earlier of (i) six months from the issuance date, or (ii) the close of any capital raise conducted by the Company. The proceeds from the Target Note are for general working capital.

The Company has the right to prepay the Target Note at any time prior to the maturity date without penalty. In the event of the closing of any capital raise conducted by the Company, no less than 50% of the net proceeds shall be used to repay the Target Note, until the Target Note is paid in full.

After an occurrence of an event of default, as described in the Target Note, it shall become immediately due and payable and the original issue discount shall increase from 20% to 40%.

On June 30, 2025, the Company issued to Target a second promissory note in the principal amount of $625,000, with an original issue discount of $125,000 such that the purchase price was $500,000 (the "Second Target Note").

The Second Target Note has identical terms and provisions to the original Target Note.

**Cash Flows for the Nine Months Ended September 30, 2025 and 2024**

The following table provides detailed information about our net cash flows for the periods indicated:

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| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended <br> September 30,** | **For the Nine Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| Net cash used in operating activities | $(3555276) | $(9328339) |
| Net cash used in investing activities | (1926315) | (206155) |
| Net cash provided by financing activities | 5334147 | 10036732 |
| Net increase (decrease) in Cash, cash equivalents and restricted cash | $(147444) | $502238 |

---

*Operating Activities*

For the nine months ended September 30, 2025, operating activities used $3,555,276 of cash compared to $9,328,339 net cash used for the nine months ended September 30, 2024. The cash used was primarily due to the Company's net loss of $7,975,878 offset by non-cash expense of $3,524,358 which consisted of $864,293 of depreciation and amortization, $19,177 of amortization of issuance costs, $927,945 of amortization of debt discount, $184,558 of amortization of operating rights of use assets, $139,274 of stock-based compensation, $699,700 of issuance of class A common stock for services and $689,411 of debt extinguishment loss. The Company also saw positive working capital of $896,244, including decrease in accounts receivables of $11,971, $59,036 decrease in inventory, $557,401 decrease in prepaid expenses and other current assets, $5,770 decrease in other assets, $279,238 decrease in accounts payable, $684,170 increase in accrued expenses, and $142,866 decrease in operating lease liabilities.

For the nine months ended September 30, 2024, operating activities used $9,328,339 of cash compared to $3,065,990 net cash used for the nine months ended September 30, 2023. The cash used was primarily due to the Company's net loss of $10,297,539 offset by non-cash expense of $6,136,057, which consisted of $1,028,475 of depreciation and amortization, $15,825 of amortization of issuance costs, $2,129,380 of amortization of debt discount, $269,172 of amortization of operating rights of use assets, $23,647 for stock-based compensation, $286,696 for issuance of class A common stock for services, $1,587,862 for loss on debt modification, $20,000 for issuance of class A common stock for general release agreement, $600,000 for issuance of Class A common stock and pre-funded warrants in connection with commitment shares, $467,049 for gain on disposal of business and positive working capital of $4,440,656, including increase in accounts receivables of $86,978, $34,527 increase in inventory, $2,701,612 increase in prepaid expenses and other current assets, $12,220 increase in other assets, $1,133,012 decrease in accounts payable,$574,196 decrease in accrued expenses, $92,322 decrease in cumulative series A preferred stock dividends payable, and $80,823 decrease in operating lease liabilities. These increases were offset by decreases of $151,796 decrease in refundable income tax and $32,519 due from former owners.

*Investing Activities*

For the nine months ended September 30, 2025, the cash used was attributable to the purchase of property and equipment of $76,315 and payment for acquisition of business of $1,850,000.

For the nine months ended September 30, 2024, the cash used was attributable to the purchase of property and equipment of $206,155.

*Financing Activities*

 

For the nine months ended September 30, 2025, the cash provided was due to the $1,571,466 proceeds from issuance of class A common stock and pre-funded warrants, net of issuance costs, $2,285,521 proceeds from issuance of class A common stock and warrants, net of issuance costs, $1,020,295 proceeds from loans payable, $2,222,663 proceeds from issuance of convertible series B preferred stock, $761,190 proceeds from notes payable, net of discount, $250,000 proceeds from Convertible Notes Payable, $1,000,000 proceeds from issuance of convertible debenture, $2,774,400 repayments from loans payable, and $1,002,588 repayment of notes payable.

For the nine months ended September 30, 2024, the cash provided was due to the $8,835,458 proceeds from issuance of class A common stock and pre-funded warrants, net of issuance costs, $1,467,935 net proceeds from loans payable, $200,000 proceeds for issuance of convertible series A preferred stock, $1,000,000 proceeds from convertible note payable, $3,500,000 proceeds from exercise warrants offset by $3,916,004 payments on loan payable, $250,000 payments on convertible notes payable, $700,657 repayment on note payable and $100,000 repayment on convertible debentures.

**The Company's consolidated results of operations for the years ended December 31, 2024 compared to December 31, 2023 were significantly impacted by acquisitions.**

*Results of Operations for the years ended December 31, 2024 and 2023:*

**Summary of Results of Operations**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** | **For the Year Ended** | **For the Year Ended** |
|  | **2024** | **2023** | **$ Change** | **%<br> Change** |
| Service revenue | $12188526 | $11879934 | 308592 | 3% |
| Product revenue | 4403583 | 4795459 | (391876) | -8% |
| Total revenue | 16592109 | 16675393 | (83284) | 0% |
| Operating expenses |  |  |  |  |
| Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 9736282 | 9700963 | 35319 | 0% |
| Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 3563279 | 3420515 | 142764 | 4% |
| General and administrative expenses | 11421352 | 9476287 | 1663815 | 18% |
| Depreciation and amortization | 1308619 | 1252539 | 56080 | 4% |
| Impairment expense | 56664 |  | 56664 | 100% |
| Gain on sale of business | (467049) |  | (467049) | 100% |
| &nbsp;&nbsp;&nbsp;Total operating expenses | 25619147 | 23850304 | 1768843 | 7% |
| &nbsp;&nbsp;&nbsp;Loss from operations | (9027038) | (7174911) | (1852127) | 26% |
| Other income (expenses): |  |  |  |  |
| Interest income | 53 | 21 | 32 | 152% |
| Interest expense | (3098290) | (2538710) | (559580) | 22% |
| Loss on debt extinguishment |  | (16105) | 16105 | -100% |
| Loss on debt modification | (2134218) | (927054) | (1207164) | 130% |
| Beneficial conversion feature |  | (4137261) | 4137261 | -100% |
| Other income (expenses) | (4768) | 1134 | (5902) | -520% |
| &nbsp;&nbsp;&nbsp;Total other expenses | (5237223) | (7617975) | 2380752 | -31% |
| &nbsp;&nbsp;&nbsp;Loss before income taxes | (14264261) | (14792886) | 528625 | -4% |
| &nbsp;&nbsp;&nbsp;Benefit for income taxes |  |  |  | 0% |
| &nbsp;&nbsp;&nbsp;Net loss | (14264261) | (14792886) | 528625 | -4% |
| &nbsp;&nbsp;&nbsp;Dividend on convertible series A preferred stock | (220850) | (271245) | 50395 | -19% |
| &nbsp;&nbsp;&nbsp;Net loss attributable to class A and B common stockholders | $(14485111) | $(15064131) | 579020 | -4% |
| Net loss per Class A and B common shares: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | $(2.61) | $(3.50) |  |  |
| Weighted average shares outstanding per Class A and B common shares: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | 5550959 | 4309796 |  |  |

---

**Revenue**

The following table presents the breakdown of revenue between products and services:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Year Ended<br> December 31,** | **For the Year Ended<br> December 31,** | **December 31, 2024 vs. <br> December 31, 2023** | **December 31, 2024 vs. <br> December 31, 2023** |
|  | **2024** | **2023** | **$ Change** | **% <br> Change** |
| Revenue: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Service Revenue | $12188526 | $11879934 | $308592 | 3% |
| &nbsp;&nbsp;&nbsp;*Percentage of revenue* | 73% | 71% |  |  |
| &nbsp;&nbsp;&nbsp;Product Revenue | 4403583 | 4795459 | (391876) | -8% |
| &nbsp;&nbsp;&nbsp;*Percentage of revenue* | 27% | 29% |  |  |
| Total | $16592109 | $16675393 | $(83284) | 0% |

---

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Average Daily Service<br>Revenue for the Year Ended** | **Average Daily Service<br>Revenue for the Year Ended** | **December 31, 2024 vs.<br> December 31, 2023** | **December 31, 2024 vs.<br> December 31, 2023** |
| <br>**Animal Hospital & Clinics** | **December 31, <br> 2024** | **December 31, <br> 2023** | **$ Change** | **% <br> Change** |
| Kauai Veterinary Clinic<sup>1</sup> | $2830 | $4134 | $(1304) | -32% |
| Chiefland Animal Hospital | 1606 | 1631 | (25) | -2% |
| Pets & Friends Animal Hospital | 3602 | 2676 | 926 | 35% |
| Advanced Veterinary Care of Pasco | 1887 | 1888 | (1) | 0% |
| Lytle Veterinary Clinic | 1761 | 1759 | 1 | 0% |
| Southern Kern Veterinary Clinic | 3564 | 2809 | 755 | 27% |
| Bartow Animal Clinic | 1835 | 2350 | (515) | -22% |
| Dietz Family Pet Hospital | 1497 | 1804 | (307) | -17% |
| Aberdeen Veterinary Clinic | 1176 | 1718 | (542) | -32% |
| All Breed Pet Care Veterinary Clinic | 2747 | 2838 | (90) | -3% |
| Pony Express Veterinary Hospital | 3559 | 4070 | (511) | -13% |
| Williamsburg Animal Clinic | 2223 | 2252 | (29) | -1% |
| Old 41 Animal Hospital | 1341 | 2227 | (886) | -40% |
| Valley Veterinary Services Animal Hospital | 3673 | 2699 | 974 | 100% |
| Total Daily Service Revenue | $33302 | $34855 | $(1553) |  |

---

1. The veterinary practice was
sold effective September 20, 2024.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Average Daily Product<br> Revenue for the Year Ended** | **Average Daily Product<br> Revenue for the Year Ended** | **December 31, 2024 vs.<br> December 31, 2023** | **December 31, 2024 vs.<br> December 31, 2023** |
| <br>**Animal Hospital & Clinics** | **December 31, <br> 2024** | **December 31, <br> 2023** | **$ Change** | **% <br> Change** |
| Kauai Veterinary Clinic<sup>1</sup> | $991 | $1810 | $(819) | -45% |
| Chiefland Animal Hospital | 1017 | 1033 | (15) | -1% |
| Pets & Friends Animal Hospital | 1063 | 911 | 152 | 17% |
| Advanced Veterinary Care of Pasco | 510 | 816 | (307) | -38% |
| Lytle Veterinary Clinic | 902 | 914 | (12) | -1% |
| Southern Kern Veterinary Clinic | 744 | 530 | 214 | 40% |
| Bartow Animal Clinic | 950 | 1027 | (77) | -7% |
| Dietz Family Pet Hospital | 596 | 853 | (258) | -30% |
| Aberdeen Veterinary Clinic | 485 | 573 | (88) | -15% |
| All Breed Pet Care Veterinary Clinic | 811 | 1287 | (476) | -37% |
| Pony Express Veterinary Hospital | 1436 | 1815 | (379) | -21% |
| Williamsburg Animal Clinic | 691 | 744 | (53) | -7% |
| Old 41 Animal Hospital | 449 | 648 | (199) | -31% |
| Valley Veterinary Services Animal Hospital | 1386 | 1219 | 167 | 100% |
| Total Daily Product Revenue | $12.032 | $14180 | $(2149) |  |

---

1. The veterinary practice was
sold effective September 20, 2024.

**Revenue in General:** The Company believes the breakdown of gross revenue into service revenue and product revenue categories produces meaningful measures to Company management and the Company's investors in light of the Company's objective to protect the service channel and derive the majority of its revenue from services and expertise which are not capable of disruption from other channels. To achieve this objective, the Company seeks to match the industry target metric of 70% to 80% of gross revenue being derived from services: examination fees, diagnostics fees, laboratory work, surgery and other veterinary services. The Company believes these service revenue sources require veterinary professionals to preside over care delivery and, unlike some veterinary care products, cannot be replaced or sold by other non-veterinary hospital channels such as retail (including over-the-counter and online). Accordingly, the Company views products such as parasite controls, veterinary nutrition products and additives as important, but the Company does not rely on product revenue to account for more than 20% to 30% of gross revenue. Medications and therapeutics which only a licensed veterinary doctor or licensed technician can administer, while still making up part of the 20% to 30% of gross revenue, are less easily diverted to non-veterinary hospital channels as they require licensed professionals to prescribe or utilize them.

The Company uses these percentages in concert with metrics such as Revenue Per Patient Per day ("RPP") and Average Patient Charge ("APC") to analyze the comprehensive nature of diagnostics and services provided by each veterinary hospital. Sometimes referred to "quality medicine" metrics within the veterinary service industry, the Company uses RPP and APC to determine how a doctor's time is being utilized (inclusive of all diagnostics and therapies). RPP and APC metrics are consolidated into the presentation of average daily service revenue and average daily product revenue. The Company believes these analyses helps the Company ensure that its caseload is revenue positive to avoid clinicians spending time on patient work which underutilizes their time and erodes labor profitability. The Company also believes these metrics are useful to investors and potential investors to compare the Company's service-to-product revenue mix against generally accepted industry targets and specific veterinary care service provider competitors.

The services revenue and product revenue metrics are measured in dollars as calculated by the practice management software we provide to each of our clinics to track medical notes, treatment plans, services and products prescribed and provided, as well as to manage invoicing related to all of the above. Reports are generated which allow Company management to view each of these as line-items as well as measure the ratio of service revenue versus product revenue within our revenue mix.

The Company believes the ratio metric is useful for the management and its investors for several reasons:

● The Company and its medical leadership teach and enable its medical staff to provide comprehensive medical care which is appropriate for each animal patient. For example, charges to a client which skew too heavily toward products and do not include necessary services may be an indicator that medical cases are not being fully diagnosed using an appropriate standard of available and appropriate diagnostics and care. This broad analysis can indicate more questions should be asked about how cases are managed by certain providers, particularly if patterns emerge;

● Comprehensive care for pets means physical exams, dental care, blood work and many other service related line-items. An overreliance on product revenue alone (which products may be available over-the-counter outside of the veterinary channel) leaves veterinary clinics susceptible to sales transfer to other channels. In addition, appropriate veterinary care (as defined by market practice and some state licensing boards) does not include prescribing products without the delivery of diagnostic and care services.

● Advancements in veterinary care within the last decade such as anesthetic protocols, pain management, fear free medicine and other services have shown great efficacy for the betterment of patients and their recovery from illness or surgeries. The absence of certain services and procedures within, for instance, a surgery package for a patient, would indicate an opportunity to improve outcomes for a patient and extend life expectancy. These are positive outcomes for clients and, therefore, of interest and value to the Company and our investors.

**Service Revenues:** The Company recognizes service revenue from health exams, pet grooming, veterinary care, and certain other services performed at our animal hospitals or clinics and is recognized once the service is completed, as this is when the customer has the ability to direct the use of and obtain the benefits of the services. Payment terms are at the point of sale but may also occur upon completion of the service. Service revenue increased $308,592 or 3%, to $12,188,526 for the year ended December 31, 2024 as compared to $11,879,934 for the year ended December 31, 2023. The increase was driven primarily by the acquisition of animal hospital in Q4 2023 and an increase in the price of our services slightly offset by the sale of the KVC practice in the third quarter of 2024.

**Product Revenues:** Product revenue is recognized when control passes, which occurs at a point in time when the customer completes a transaction at our animal hospitals or clinics and receives the product. Product revenue decreased $391,876, or 8%, to $4,403,583 for the year ended December 31, 2024 as compared to $4,795,459 for the year ended December 31, 2023. The overall decrease was a result of customers purchasing less products per visit and by the sale of the KVC practice in the third quarter of 2024.

**Cost of revenue**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Year Ended** | **For the Year Ended** | **December 31,<br> 2024 vs. 2023** | **December 31,<br> 2024 vs. 2023** |
|  | **December 31, <br> 2024** | **December 31,<br> 2023** | **Variance in<br> Dollars** | **Variance in<br> Percent** |
| Cost of services revenue | $9736282 | $9700963 | $35319 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0% |
| Cost of product revenue | 3563279 | 3420515 | 142764 | 4% |
| Total cost of revenues (exclusive of depreciation and amortization, shown separately below) | $13299561 | $13121478 | $178083 | 1% |

---

**Cost of service revenue (exclusive of depreciation and amortization):** Cost of service revenue consists of cost directly related to the animal services provided at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, laboratory costs, pet supply costs, third-party veterinarian contractors, office rent, utilities, supplies, and other cost arising as a result of the services being performed, excluding depreciation and amortization. Cost of service revenue increased $35,319, or 0%, to $9,736,282 for the year ended December 31, 2024 as compared to $9,700,963 for the year ended December 31, 2023. The increase in cost of service revenue sold excluding depreciation and amortization was driven primarily by the acquisition of Valley Veterinary animal hospital and increase to service costs slightly offset by the sale of the KVC practice in the third quarter of 2024.

**Cost of product revenue (exclusive of depreciation and amortization):** Cost of product revenue consists of cost directly related to the product sales at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, purchase price of the medication we dispense, and purchase price of product sold, excluding depreciation and amortization. Cost of product revenue increased $142,764, or 4%, to $3,563,279 for the year ended December 31, 2024 as compared to $3,420,515 for the year ended December 31, 2023. The increase in cost of product revenue was driven primarily by the acquisition of Valley Veterinary animal hospital, an increase to payroll costs and increase in product cost slightly offset by the sale of the KVC practice in the third quarter of 2024.

**General and Administrative Expense:** General and administrative expenses include personnel-related compensation costs for corporate employees, such as management, accounting, legal, acquisition related and non-recurring expenses, insurance and other expenses used to operate the business. General and administrative expenses increased $1,945,065, or 21% to $11,421,352 for the year ended December 31, 2024 as compared to $9,476,287 for the year ended December 31, 2023. The increase was primarily due to the expenses generated by the Valley Veterinary practice acquisition, the IR agency contracts, marketing agreements and consulting contracts the Company entered into during the first quarter of 2024 following the February 2024 public offering and in the third quarter following the July 2024 public offering.

**Depreciation and Amortization Expense:** Depreciation and amortization expenses mainly relate to the assets used in generating revenue. Depreciation and amortization increased $56,060, or 4%, to $1,308,619 for the year ended December 31, 2024 as compared to $1,252,539 for the year ended December 31, 2023. The increase was primarily due to the acquisition of depreciable or amortizable assets as part of the Valley Veterinary acquisition.

**Other Expenses:** Other expenses are composed primarily of interest expenses and small denomination bank fee charges. Other expenses decreased $2,380,752, or 31%, to $5,237,223 for the year ended December 31, 2024 as compared to $7,617,975 for the year ended December 31, 2023. The decrease was primarily due to the decrease in the beneficial conversion offset by the financing arrangements to fund working capital at a very high effective interest rate as compared to the Company's term loans.

**Net Loss:** Net Loss decreased $528,625, or 5%, to $14,264,261 for the year ended December 31, 2024 as compared to $14,792,886 for the year ended December 31, 2023. The decrease in net loss is primarily due to the gain on sale of KVC practice during the year and omission of any beneficial conversion feature during the year ended December 31, 2024.

**Liquidity and Capital Resources**

Since inception, we have financed our operations from a combination of:

● issuance and sale of senior convertible notes;

● issuance of convertible debentures;

● borrowings under other debt consisting of: (i) a principal lending relationship with Farmers National Bank of Danville; (ii)a principal lending relationship with First Southern National Bank; (iii) short term financing arrangements under merchant cash advance agreement;

● common stock purchase agreement with Tumim Stone Capital LLC,

● proceeds from issuance of equity; and

● cash generated from operations.

The Company has experienced operating losses since its inception and had a total accumulated deficit of $36,350,281 as of December 31, 2024. The Company expects to incur additional costs and require additional capital as the Company continues to acquire additional veterinary hospitals, clinics and practices. For the year ended December 31, 2024, the Company's cash used in operations was $10,005,866.

The Company's primary short-term cash requirements are to fund working capital, lease obligations and short-term debt, including current maturities of long-term debt. Working capital requirements can vary significantly from period to period, particularly as a result of additional business acquisitions. The Company's medium-term to long-term cash requirements are to service and repay debt, to expand through acquisitions, and to invest in facilities and equipment for growth initiatives.

The Company's ability to fund its cash needs will depend, in part, on its ability to generate cash in the future, which depends on future financial results. The Company's future results are subject to general economic, financial, competitive, legislative and regulatory factors that may be outside of our control. The Company's future access to, and the availability of credit on acceptable terms and conditions, is impacted by many factors, including capital market liquidity and overall economic conditions.

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring losses and as of December 31, 2024, had an accumulated deficit of $36,350,281. For the year ended December 31, 2024, the Company sustained a net loss of $14,264,261. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern for the next twelve months from the date these financial statements were issued. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is contingent upon its ability to obtain additional financing and to generate revenue and cash flow to meet its obligations on a timely basis. The Company will continue to seek to raise additional funding through debt or equity financing during the next twelve months. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving these objectives.

We cannot be sure that future funding will be available to us on acceptable terms, or at all. Due to often volatile nature of the financial markets, equity and debt financing may be difficult to obtain.

We may seek to raise any necessary additional capital through a combination of private or public equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing and distribution arrangements. To the extent that we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights or future revenue streams on terms that may not be favorable to us. If we raise additional capital through private or public equity offerings, the ownership interest of our existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders' rights. If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

As of the date of this filing, the Company was in compliance with all covenants and restrictions associated with our debt agreements. The Company is not aware of any instances of breaches or non-compliance with its covenants and commitments under its debt agreements.

**Master Lending and Credit Facility**

On June 25, 2021, the Company entered into a master line of credit loan agreement ("MLOCA") with Wealth South a division of Farmers National Bank of Danville, Kentucky ("FNBD"). The MLOCA provides for a $2,000,000 revolving secured credit facility ("Revolving Line") to be drawn for the initial purchase of veterinary clinical practices ("Practices") and a $8,000,000 closed end line of credit ("Closed End Line") to be disbursed as individual loans (Term Loans) to paydown draws on the Revolving Line and to provide longer term financing of the purchase of Practices. Each draw on the Revolving Line shall be repaid with a Term Loan out of the Closed End Line within one hundred and twenty (120) days of the draw on the Revolving Line. Each draw on the Revolving Line and the Closed End Line shall not exceed eighty-five (85%) percent of the purchase price of the Practice. The Company shall contribute and maintain equity of a minimum of fifteen (15%) percent of the initial purchase price of a Practice as long as any draw on the Revolving Line or a Term Loan remains unpaid with FNBD. The Revolving Line has an interest rate equal to the New York Prime Rate plus 0.50% that shall never be less than 3.57%. Each Term Loan issued under the Closed End Line shall have a fixed interest rate of 3.98% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest rate will equal to the New York Prime Rate plus 0.65% that shall never be less than 3.57%. Each Practice to be acquired must have a minimum projected debt-service coverage ratio ("DSCR") of 1.0x, defined as earnings before interest depreciation and amortization ("EBIDA")/Annual Debt Service Requirement.

Under the MLOCA the Term Loans to acquire a Practice shall not exceed 10 years. The first twelve months of the Term Loan may be interest only. Thereafter, the Loan will convert to an amortizing loan with monthly principal and interest payments. For Practice only Term Loans ("Practice Term Loans"), after the initial twelve-month interest only period, the balance will amortize over 9 years. For Loans made to purchase real property ("RE Term Loans"), after the initial twelve-month interest only period, the balance will amortize over a 19-year period.

There is no prepayment penalty on payments on the Revolving Line. The Term Loans are subject to a refinance fee of 2% of the then outstanding principal balance of the Term Loan if paid within two years of entering into the Term Loan and 1% of the then outstanding principal balance of the Term Loan if paid within three to five years of entering into the Term Loan. The refinance fee is due only if the Term Loan is paid off by refinancing. Borrowing under the MLOCA are guaranteed by Kimball Carr, CEO & President of the Company.

On August 18, 2022 the MLOCA was amended and restated to terminate the revolving feature on the Revolving Line and convert the line of credit to a closed end draw note ("Closed End Draw Note") that mature on August 18, 2024. Each draw on the Closed End Draw Note shall not exceed eighty-five (85%) percent of the purchase price of the Practice. The Company shall contribute and maintain equity of a minimum of fifteen (15%) percent of the initial purchase price of a Practice as long as any draw on the Closed End Draw Note or a Term Loan remains unpaid with FNBD. The interest rate charge on all sums advance under the amended and restated MLOCA shall be 5.25% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest will be equal to the New York Prime Rate plus 0.65% that shall never be less than 4.75%. Each Practice to be acquired must have a minimum projected DSCR of 1.0x, defined as EBIDA/Annual Debt Service Requirement.

Notes payable to FNBD as of December 31, 2024 and 2023 consisted of the following:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** |<br>**Entered** |<br>**Maturity** |<br>**Interest** | **December 31,**<br>**2024** | **December 31,**<br>**2023** | **Issuance**<br>**Cost** |
| $237272 | CAH | 12/27/2021 | 12/27/2041 | 3.98% | $219975 | $228785 | $6108 |
| 231987 | CAH | 12/27/2021 | 12/27/2031 | 3.98% | 187461 | 210161 | 6108 |
| 216750 | P&F | 12/27/2021 | 12/27/2041 | 3.98% | 200949 | 208997 | 5370 |
| 318750 | P&F | 12/27/2021 | 12/27/2031 | 3.98% | 257571 | 288761 | 5370 |
| 817135 | Pasco | 1/14/2022 | 1/14/2032 | 3.98% | 667050 | 746733 | 3085 |
| 478098 | Lytle | 3/15/2022 | 3/15/2032 | 3.98% | 398275 | 444593 | 1898 |
| 663000 | Lytle | 3/15/2022 | 3/15/2042 | 3.98% | 621020 | 645392 | 11875 |
| 425000 | Kern | 3/22/2022 | 3/22/2042 | 3.98% | 398089 | 413713 | 7855 |
| 1275000 | Kern | 3/22/2022 | 3/22/2032 | 3.98% | 1062126 | 1185648 | 4688 |
| 246500 | Bartow | 5/18/2022 | 5/18/2042 | 3.98% | 232428 | 241429 | 5072 |
| 722500 | Bartow | 5/18/2022 | 5/18/2032 | 3.98% | 613737 | 683262 | 2754 |
| 382500 | Dietz | 6/15/2022 | 6/15/2032 | 3.98% | 328026 | 364708 | 1564 |
| 445981 | Aberdeen | 7/19/2022 | 7/29/2032 | 3.98% | 386120 | 428747 | 1786 |
| 1020000 | All Breed | 8/12/2022 | 8/12/2042 | 3.98% | 971173 | 1008039 | 8702 |
| 519527 | All Breed | 8/12/2022 | 8/12/2032 | 3.98% | 453984 | 503471 | 3159 |
| 225923 | All Breed | 8/12/2022 | 8/12/2032 | 5.25% | 198905 | 219347 | 3159 |
| 637500 | Williamsburg | 12/8/2022 | 12/8/2032 | 5.25% | 580834 | 637500 | 2556 |
| 850000 | Valley Vet | 11/8/2023 | 11/8/2033 | 5.25% | 843796 | 850000 | 3315 |
| $9713423 |  |  |  |  | $8621519 | $9309286 | $84424 |

---

The Company amortized $6,206 and $7,152 of issuance cost in the aggregate during the year ending December 31, 2024 and 2023, respectively, for the FNBD notes payable.

**FSB Commercial Loans**

The Company entered into three separate commercial loans with First Southern National Bank ("FSB") as part of the acquisition. The first commercial loan in the amount of $1,105,000 has a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan has monthly payments of $6,903 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $13,264 that was capitalized and is being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024 and required the lender to make monthly payments of $9,016 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of Kauai Veterinary Clinic ("KVC").

The second commercial loan with FSB entered into on January 11, 2021 in the amount of $1,278,400 has a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan has monthly payments of $13,157 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $10,085 that was capitalized and is being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024 and required the lender to make monthly payments of $14,898 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of Kauai Veterinary Clinic ("KVC").

The third commercial loan with FSB entered into on January 11, 2021 in the amount of $450,000 has a fixed interest rate of 5.05% and a maturity date of September 11, 2021. The commercial loan was modified on August 25, 2021 to extend the maturity date to February 25, 2023 and increase the principal amount to $469,914. The fixed rate loan has monthly payments of $27,164 and was fully paid off on the maturity date. The commercial loan had issuance costs of $753 that was capitalized and is being amortized straight line over the life of the loan. This loan was paid in full in February 2023.

On October 31, 2022 the company entered into three separate commercial loans with FSB as part of the Pony Express Practice acquisition. The first loan with FSB that was entered into on October 31, 2022, was in the amount of $2,086,921. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $23,138 except for a final monthly payment of $1,608,530. The commercial loan had issuance costs of $25,575 that was capitalized and is being amortized straight line over the life of the loan.

The second loan with FSB that was entered into on October 31, 2022, was in the amount of $400,000. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2042. The fixed rate loan has monthly payments of $2,859. The commercial loan had issuance costs of $3,277 that was capitalized and is being amortized straight line over the life of the loan.

The third loan with FSB that was entered into on October 31, 2022, was in the amount of $700,000. The loan has a fixed interest rate of 6.75% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $6,903 except for a final monthly payment of $423,278. The commercial loan did not have any issuance costs that were capitalized.

On December 16, 2022, the company entered into two separate commercial loans with FSB as part of the Old 41 Practice acquisition. The first loan with FSB that was entered into on December 16, 2022, was in the amount of $568,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has monthly payments of $4,772 and a full payoff of the remaining principal balance at maturity. The loan had issuance costs of $4,531 that was capitalized and is being amortized straight line over the life of the loan.

The second loan with FSB that was entered into December 16, 2022, was in the amount of $640,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has twelve monthly payments of approximately $2,830, followed by monthly payments of $7,443. and the interest rate is 6.50%. The loan had issuance costs of $5,077 that was capitalized and is being amortized straight line over the life of the loan.

On November 8, 2023, the Company entered into a commercial loan with FSB as part of the Valley Vet practice acquisition. The loan with FSB was entered into on November 8, 2022 for $375,000. The loan has a fixed interest rate of 8.5%. The loan had issuance costs of $5,077 that was capitalized and is being amortized straight line over the life of the loan.

The FSB commercial loans are guaranteed by Kimball Carr, Chief Executive Officer and President and Charles Stith Keiser, our director and former Chief Operating Officer.

Notes payable to FSB as of December 31, 2024 and 2023 consisted of the following:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** |<br>**Entered** |<br>**Maturity** |<br>**Interest** | **December 31,**<br>**2024** | **December 31,**<br>**2023** | **Issuance**<br>**Cost** |
| $1105000 | KVC | 1/25/2021 | 2/25/2041 | 4.35% | $— | $997010 | $13264 |
| 1278400 | KVC | 1/25/2021 | 1/25/2031 | 4.35% |  | 960849 | 10085 |
| 469914 | KVC | 1/25/2021 | 2/25/2023 | 5.05% |  |  | 753 |
| 2086921 | Pony Express | 10/31/2022 | 10/31/2025 | 5.97% | 1733807 | 1902452 | 25575 |
| 400000 | Pony Express | 10/31/2022 | 10/31/2042 | 5.97% | 375943 | 387433 | 3277 |
| 700000 | Pony Express | 10/31/2022 | 8/16/2023 | 7.17% |  |  |  |
| 568000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 470227 | 520697 | 4531 |
| 640000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 406641 | 623861 | 5077 |
| 375000 | Valley Vet | 11/8/2023 | 11/8/2024 | 8.50% | 375000 | 375000 | 6877 |
| $7623235 |  |  |  |  | $3361618 | $5767302 | $69439 |

---

The Company amortized $19,053 and $14,611 of issuance cost in the aggregate during the year ended December 31, 2024 and 2023, respectively, for the FSB notes payable.

Notes payable as of December 31, 2024 and 2023 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2024** | **December 31,**<br>**2023** |
| FNBD Notes Payable | $8621519 | $9309286 |
| FSB Notes Payable | 3361618 | 5767302 |
| Total notes payable | 11983137 | 15076588 |
| Unamortized debt issuance costs | (81909) | (124170) |
| Notes payable, net of issuance cost | 11901228 | 14952418 |
| Less current portion | (3410465) | (1469043) |
| Long-term portion | $8490763 | $13483375 |

---

Notes payable repayment requirements as of December 31, 2024, in the succeeding years are summarized as follows:

---

| | |
|:---|:---|
| 2025 | $3416965 |
| 2026 | 1203521 |
| 2027 | 872072 |
| 2028 | 909759 |
| 2029 | 950587 |
| Thereafter | $4630233 |

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**Bridge Notes**

In December 2021, the Company entered into two bridge loans in the aggregate of $2,500,000 with Target Capital 1, LLC and Dragon Dynamic Catalytic Bridge SAC Fund as short term secured convertible notes ("Bridge Note"). The Bridge Note was convertible into the Company's common stock, at the time of a successful initial public offering ("IPO") at the noteholder's option, at a 35% discount to the IPO price. The Bridge Note had a face value of $2,500,000 with an original issue discount ("OID") of 12% and had a maturity date of January 24, 2023. The OID of $300,000 was amortized over the life of the loan. If the Company had not issued the Company's common stock in an initial public offering pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission ("SEC") and the listing of the common stock on a "national securities exchange" as defined in Section 6 of the Securities Exchange Act of 1934, as amended ("Qualified financing") by January 24, 2023 the conversion price will be set at a 40% discount to the IPO price. The Bridge Note was funded in two installments of net proceeds of $1,100,000 in December 2021 and the second installment January 2022. The Bridge Loan had issuance costs of $70,500 for the first installment and $54,000 for the second installment that is amortized straight line over the life of the loan. The Company amortized $0 of issuance cost for the year ended December 31, 2024 and 2023.

In conjunction with the Bridge Note the Company issued warrants on January 24, 2022 to Target Capital 1, LLC and Dragon Dynamic Catalytic Bridge SAC Fund (collectively the "Bridge Lenders"). The warrants entitled the Bridge Lenders to purchase the Company's Class A common stock, at a purchase price equal to the per share price in an IPO. The quantity of the Company's common stock of subject to purchase upon exercise of the warrants is equal to 50% of the face value of the Bridge Note, divided by the per-share price in the Qualified Financing, unless a Qualified Financing had not been completed by January 24, 2023 in which case the quantity of Class A common stock subject to purchase upon exercise of the warrants will be an amount equal to 75% of the face value of the Bridge Note divided by the per-share price in the Qualified Financing. If a Qualified Financing has not consummated or the Bridge Note had not been repaid in full on or before January 24, 2027, then the quantity of common stock subject to purchase upon exercise of the warrants will be an amount equal to 100% of the face value divided by the per-share price equal to the fair market value of one share of Class A common stock as mutually agreed by the Holder and the Company. The warrants were exercisable through the fifth anniversary of the issuance date. The warrants could be redeemed at the option of the Company at any time following a Qualified Financing if the Company's common stock trade on a national securities exchange at a price equal to the purchase price of the Company's common stock in the Qualified Financing multiplied by 2 for a period of ten consecutive trading days.

On November 18, 2022, the Company entered into an Original Issue Discount Secured Convertible Note loan ("bridge loan") with Target Capital 1, LLC for $1,136,364. The note is issued at an original issue discount of 12% with an maturity date on the earlier of March 31, 2023 ("Initial Maturity Date") or the Company's sale of its Common Stock in an initial public offering pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission and the listing of the Common Stock on a "national securities exchange" as defined in Section 6 of the Securities Exchange Act of 1934, as amended ("Qualified Financing" or the "Maturity Date"). The note bears an interest rate of 12% per annum by means of the original issue discount. Upon the occurrence of an Automatic Extension, this note shall commence to accrue interest at an interest rate of 12% percent per annum on the date of the commencement of the Automatic Extension until the note is converted or is paid in full. The Company may pay the full principal amount of this note, and all accrued but unpaid interest at any time prior to the Maturity Date without the prior written consent of the Holder in the principal amount of $1,136,364, plus all accrued but unpaid interest, multiplied by 120%. In addition, and to the extent the Company is required to pay this note in cash at the on or after the Initial Maturity Date due to, upon the closing date of a Qualified Financing, the Company shall pay to the Holder $1,136,364, plus all accrued unpaid interest, multiplied by 120%. Upon the occurrence and during the continuation of an Event of Default, until the Event of Default is cured, or the Note is repaid in full, Company will pay 20% of its total gross revenues (including that of all its subsidiaries) monthly, which shall be applied to payment of principal and interest under this this note. The conversion price (the "Conversion Price") shall be equal to the price paid by the public in the Company's Qualified Financing multiplied by 0.65 (or 0.60, from and after any Automatic Extension).

In conjunction with the Original Issue Discount Secured Convertible Note with Target Capital 1, LLC the company issued the holder 412 shares of Class A Common Stock and equity classified warrants that entitle the holder to purchase the Company's common stock at a purchase price equal to the per share price in an IPO. The quantity of the Company's common stock of subject to purchase upon exercise of the warrants is equal to 75% of the face value of the Bridge Note, divided by the per-share price in the Qualified Financing.

On November 18, 2022, the Company entered into an Original Issue Discount Secured Convertible Note with 622 Capital LLC for $568,182. The note is issued at an original issue discount of 12% with an maturity date on the earlier of January 24, 2023 ("Initial Maturity Date") or the Company's sale of its Common Stock in an initial public offering pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission and the listing of the Common Stock on a "national securities exchange" as defined in Section 6 of the Securities Exchange Act of 1934, as amended ("Qualified Financing" or the "Maturity Date"). If the Company has filed its Form S-1 Registration Statement with the SEC on or prior to the Initial Maturity Date but the Qualified Financing has not closed by such date ("Automatic Extension") then all principal and accrued interest under this Note shall become due and payable in cash on July 24, 2023 (the "Final Maturity Date") or such earlier date as this Note is required be repaid. The note bears an interest rate of 12% per annum by means of the original issue discount. Upon the occurrence of an Automatic Extension, this note shall commence to accrue interest at an interest rate of 12% percent per annum on the date of the commencement of the Automatic Extension until the note is converted or is paid in full. The Company may pay the full principal amount of this note and all accrued but unpaid interest at any time prior to the Maturity Date without the prior written consent of the Holder in the principal amount of $568,182, plus all accrued but unpaid interest, multiplied by 120%. In addition, and to the extent the Company is required to pay this note in cash at the on or after the Initial Maturity Date due to, upon the closing date of Qualified Financing, the Company shall pay to the Holder $568,182, plus all accrued unpaid interest, multiplied by 120%. Upon the occurrence and during the continuation of an Event of Default, until the Event of Default is cured or the Note is repaid in full, Company will pay 20% of its total gross revenues (including that of all its subsidiaries) monthly, which shall be applied to payment of principal and interest under this this note. The conversion price (the "Conversion Price") shall be equal to the price paid by the public in the Company's Qualified Financing multiplied by 0.65 (or 0.60, from and after any Automatic Extension).

In conjunction with the Original Issue Discount Secured Convertible Note with 662 Capital LLC the company issued the holder equity classified warrants that entitle the holder to purchase the Company's common stock at a purchase price equal to the per share price in an IPO. The quantity of the Company's common stock of subject to purchase upon exercise of the warrants is equal to 50% of the face value of the Bridge Note, divided by the per-share price in the Qualified Financing, unless a Qualified Financing has not been completed by March 31, 2023 in which case the quantity of Class A common stock subject to purchase upon exercise of the warrants will be an amount equal to 75% of the face value of the Bridge Note divided by the per-share price in the Qualified Financing.

The warrants were deemed legally detachable from the Bridge Note and were fair valued using the Black Scholes Method to determine the relative fair values of the Bridge Note and the detachable warrants. The significant inputs for the Black Scholes calculation included the exercise price and common share price of $0.44, volatility rate of 27% and risk-free rate of 1.53% with a 5-year term. The proceeds received for the Bridge Note were allocated to the detached warrants based on the relative fair values. Pursuant to ASC 470 the relative fair value of the warrants attributable to a discount on debt is $429,284; this is amortized to interest expense on a straight-line basis over the term of the loan.

A roll forward of the bridge note for the year ended December 31, 2023, is below:

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| | |
|:---|:---|
| Bridge notes, December 31, 2021 | 1031917 |
| Issued for cash | 2600000 |
| Amortization of original issue discount | 386245 |
| Warrant discount | (429284) |
| Amortization of warrant discount | 303309 |
| Debt issuance costs | (164000) |
| Amortization of debt issuance costs | 170969 |
| Bridge notes, December 31, 2022 | 3899156 |
| Amortization of original issue discount | 116656 |
| Amortization of warrant discount | 125975 |
| Amortization of debt issuance costs | 62758 |
| Extinguishment of bridge notes in exchange for Series A preferred stock upon IPO on August 31, 2023 | (4204545) |
| Bridge notes, December 31, 2023 | $— |

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On June 30, 2023, the Company entered into exchange agreements (the "Exchange Agreements") with each of the Company's Bridge Note lenders, pursuant to which the lenders exchanged their existing Bridge Notes for 299 shares, 3,528 shares, and 598 shares, respectively, of Convertible Series A preferred stock (4,425 shares of Convertible Series A Preferred stock in total) (the "Exchange"). The Exchange Agreements will be deemed rescinded and the former Bridge Notes will be deemed reinstated if the Company doesn't complete an initial public offering by September 1, 2023. Upon the IPO completing on August 31, 2023, the Company recognized the extinguishment of the Bridge Notes pursuant to ASC 470 and recognized a debt extinguishment loss of $16,105. The Company recognized a beneficial conversion feature of $2,567,866 for the issuance of the Series A preferred stock on the date of the IPO due to the $4 (Pre-Reverse Split) offering price related to the IPO being known as of that date.

**Convertible Debenture**

Between March 18 and December 28, 2021, the Company issued $2,102,500 in aggregate principal amount of 6.00% subordinated convertible promissory note ("Convertible Debenture"). During the year ending December 31, 2022 the Company issued $1,612,000 in aggregated principal amount of the 6.00% Convertible Debenture. In March 2023 the Company issued an additional $650,000 in aggregate principal amount of 6.00% Convertible Debenture notes to five (5) separate holders. The Convertible Debenture is convertible into the Company's Class A Common Stock upon the Company's offering for sale its shares in a public offering ("IPO"). At the holder's election, the accrued interest and principal may be paid in cash or Class A Common Stock (such number of shares reflecting a twenty-five percent (25%) discount of the opening price per share of Class A Common Stock). The Convertible Debenture mature 5 years from the date of issuance to each holder. Prior to the maturity date, the holder is entitled to convert the Convertible Note into Class A Common Stock upon the Company's IPO. Upon an IPO the accrued and unpaid interest is due and payable in cash on the first business day of the following month of March for any balance not elected to be converted into the Class A Common Stock. The Convertible Debenture principal balance was $100,000 and $3,714,500 as of December 31, 2023 and 2022. The Convertible Debenture incurred issuance cost of $40,000 that is amortized straight line over the life of the Convertible Debenture. The Company amortized $0 and $7,996 for the years ended December 31, 2024 and 2023.

Upon the Company's IPO closing on August 31, 2023, the majority of Convertible Debenture holders elected convert an aggregate of $4,014,500 of principal and $399,818 of accrued interest into 598 shares of Class A common stock at a conversion price of $3.00 per share. The Company recorded a beneficial conversion feature as of the date of the conversion of $1,569,395 based on the PO price of $10,000 per share minus the principal and accrued interest of the Convertible Debenture balance converted into common stock. Four holders of the Convertible Debenture with an aggregate principal balance of $250,000 elected to be paid back in cash and one investor with a principal balance of $100,000 elected to be paid on February 28, 2024 including accrued interest through the date of payment at 6%.

**Loan Payable**

On May 30, 2023, the Company entered into a Merchant Cash Advance Agreement for gross proceeds of $1,050,000 with an unrelated third-party financial institution. Under the terms of the agreement, the Company must pay $57,346 each week for 26 weeks with the first payment being due June 6, 2023. The financing arrangement has an effective interest rate of 49%. The financing arrangement includes an original issuance discount ("OID") of $441,000 and issuance costs of $50,000. The OID and issuance cost associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and is amortized using the effective interest method.

On August 10, 2023, the Company amended the financing arrangement to borrow an additional $507,460 resulting in the weekly repayments increasing to $76,071 to be paid over 28 weeks. This amendment decreased the effective interest rate to 41%. The refinancing resulted in a loss on debt modification of $441,618.

On November 28, 2023, the Company amended the financing arrangement to borrow an additional $531,071 resulting in the weekly payments to decrease to $56,800 to be paid over 40 weeks. This amendment increased the effective rate to 49%. The refinancing resulted in a loss on debt modification of $485,436.

On January 18, 2024, the Company amended the financing arrangement to borrow an additional $549,185 resulting in the weekly payments to increase to $86,214 to be paid over 43 weeks. This amendment increased the effective interest rate to 52%. The refinancing resulted in a loss on debt modification of $728,278.

On May 7, 2024, the Company amended the financing arrangement to borrow an additional $518,750 resulting in the weekly payments to increase to $90,229 to be paid over 48 weeks. This amendment decreased the effective interest rate to 49%. The refinancing resulted in a loss on debt modification of $859,584.

On December 24, 2024, the Company amended the financing arrangement to borrow an additional $513,650 resulting in the weekly payments to increase to $71,995 to be paid over 41 weeks. This amendment decreased the effective interest rate to 43%. The refinancing resulted in a loss on debt modification of $546,356.

On April 4, 2024, the Company entered into a new financing agreement for gross proceeds of $420,000 with a different unrelated third-party financial institution. Under the terms of the agreement, the Company must pay $21,600 each week for 28 weeks with the first payment being due April 8, 2024. The financing arrangement has an effective interest rate of 51%. The financing arrangement includes an original issuance discount ("OID") of $184,800 and issuance costs of $20,000. The OID and issuance cost associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and is amortized using the effective interest method.

During the year ended December 31, 2024, the Company amortized $1,624,333 OID and issuance cost included in interest expense on the statement of operations. During the year ended December 31, 2024, the Company made $4,509,147 in payments on the loan payable. The outstanding balance of the loan payable as of December 31, 2024, is $2,340,020. The financing arrangement is secured by an interest in virtually all assets of the Company with a first security interest in accounts receivable. The financing arrangement is guaranteed by the Company's CEO.

During the year ended December 31, 2023, the Company amortized $671,719 of OID and issuance cost included in interest expense on the statement of operations. During the year ended December 31, 2023, the Company made $1,923,474 in payments on the loan payable. The outstanding balance of the loan payable as of December 31, 2023, is $2,063,058. The financing arrangement is secured by an interest in virtually all assets of the Company with a first security interest in accounts receivable. The financing arrangement is guaranteed by the Company's CEO.

**Convertible Notes Payable**

On March 26, 2024, Inspire entered into a securities purchase agreement (the "Purchase Agreement") with a certain investor. Pursuant to the Purchase Agreement, Inspire issued to investors Increasing OID Senior Note ("Convertible Note Payable") for $500,000. The Convertible Note Payable has a maturity date of the earlier of December 26, 2024 or the consummation of a capital raise (the "Maturity Date").

On June 11, 2024, Inspire entered into a securities purchase agreement (the "Purchase Agreement") with two investors. Pursuant to the Purchase Agreement, Inspire issued to investors Increasing OID Senior Note ("Convertible Note Payable") for $250,000 each. The Convertible Note Payable has a maturity date of the earlier of February 11, 2025 or the consummation of a capital raise (the "Maturity Date").

The Convertible Notes Payable contain an original issue discount ("OID") which shall be: (i) fifteen percent (15%) if the Convertible Notes Payable is satisfied and paid in full on or before the forty-fifth (45th) day after the Original Issue Date (as such term is defined in the Notes), (ii) twenty percent (20%) if the Convertible Notes Payable is satisfied and paid in full after such 45th day but on or before the ninetieth (90th) day after the Original Issue Date, and (iii) thirty percent (30%) after such 90th day. The Convertible Notes Payable can be prepaid at any time prior to the Maturity Date without any penalties.

The Convertible Notes Payable must be repaid in full from any future capital raises (debt, equity or any other form of capital raise) of Inspire. All of the funds raised must be used to repay the Convertible Notes Payable until the Convertible Notes Payable are repaid in full.

The Convertible Notes Payable are convertible into shares of common stock of Inspire, in full or in part, at any time after issuance at the discretion of the noteholder at a fixed conversion price of $0.75 per share (the "Fixed Conversion Price").

If the Convertible Notes Payable is not repaid by the Maturity Date the default provisions are as follow: (i) The Face Value (as such term is defined in the Convertible Notes Payable) of the Convertible Notes Payable will increase by 20% (to a 50% OID -- $1,000,000 Face Value); (ii) the conversion price of the Convertible Notes Payable will become convertible at the lower of (a) the Fixed Conversion Price or (b) 20% discount to a 3-Day volume-weighted average price (the "Default Conversion Price").

As of December 31, 2024 the balance of the convertible notes payable was $0. During the year ended December 31, 2024 the Company paid off $392,857 of the notes payable and accrued interest and converted $1,357,143 into 226,249 shares of class A common stock.

**Operating leases**

The future minimum lease payments required under leases as of December 31, 2024, were as follows:

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| | |
|:---|:---|
| **Fiscal Year** | **Operating<br> Leases** |
| 2025 | $333200 |
| 2026 | 312299 |
| 2027 | 316369 |
| 2028 | 323311 |
| 2029 | 336045 |
| Thereafter | 1332102 |
| Undiscounted cash flows | 2953326 |
| Less: imputed interest | (825858) |
| Lease liability | $2127468 |

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**Cash Flows for The Year Ended December 31, 2024 and 2023**

The following table provides detailed information about our net cash flows for the periods indicated:

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| | | |
|:---|:---|:---|
|  | **Year Ended<br> December 31,** | **Year Ended<br> December 31,** |
|  | **2024** | **2023** |
| Net cash used in operating activities | $(10005866) | $(3820771) |
| Net cash used in investing activities | (237983) | (1869530) |
| Net cash provided by financing activities | 10588578 | 5625009 |
| Net increase (decrease) in Cash, cash equivalents and restricted cash | $344729 | $(65292) |

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*Operating Activities*

Our primary source of cash from operating activities is the revenue generated from our animal hospitals and clinics. Our primary uses of cash from operating activities are the funding of our payroll and veterinary animal hospital and clinic related cost as well as the costs of supplied used in providing veterinary services. For the year ended December 31, 2024 cash flow from operations included a $14.3 million net loss, an increase of $529 thousand compared to 2023, non-cash add-backs to net loss of $6.6 million, and a $2.4 million increase in cash flows from changes in operating assets and liabilities, driven primarily by decreased outstanding accounts payable and accrued expenses and an increase to prepaid expenses offset by an increase to loans payable. Such activity, along with the timing of cash payments, are the primary drivers of the year over year changes in net cash used in operating activities.

*Investing Activities*

Our uses of cash for investing activities are capital expenditures for purchases of property and equipment for our animal hospital and clinics.

*Financing Activities*

Our primary sources of cash from financing activities are the proceeds of issuance of class A common stock and warrants, proceeds of issuance of class A common stock and pre-funded warrants, repurchase and cancellation of the class B common stock, proceeds from loans payable, payments from loans payable, proceeds from issuance of convertible series A preferred stock, proceeds from convertible note payable, payments from convertible note payable, repayment of note payable, proceeds from exercise of warrants, and repayment of convertible debentures.

**Quantitative and Qualitative Disclosures About Market Risk**

We are exposed to market risks in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily the result of fluctuations in interest rates, regulatory, and inflation.

***Interest Rate Risk***

Our credit facilities bear interest at a floating rate, generally equal to the New York Prime Rate plus an applicable margin. As a result, we are exposed to fluctuations in interest rates to the extent of our net borrowings under the Master Lending and Credit Facility, which were $11,983,137 as of December 31, 2024. The exposure to interest rate fluctuations for the Company is considered minimal. The Company's term loans issued under the Master Lending and Credit Facility have a fixed interest rate for the initial five years followed by a variable interest rate. The Company has not used any financial instruments to hedge potential fluctuations in interest rates.

As interest rates rise, there is risk in the form of more expensive loans which would negatively impact the valuation and profitability of each hospital which is purchased.

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***Inflation Risk***

We do not believe that inflation has had a material effect on our business, financial condition or results of operations. If our costs become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could harm our business, financial condition, and operating results.

**Critical Accounting Policies and Significant Judgments and Estimates**

A summary of our significant accounting policies is included in Note 2 of our audited consolidated financial statements included in this Form 10-K. The preparation of consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Our estimates and assumptions are based on historical experiences and changes in the business environment. However, actual results may differ from estimates under different conditions, sometimes materially. Critical accounting policies and estimates are defined as those that are both most important to the portrayal of our financial condition and results of operations and require management judgment. Our critical accounting policies and estimates are described below.

**Acquisitions**

The Company enters into acquisitions primarily with existing veterinary hospitals throughout the United States. When we acquire a business or assets that are determined to meet the definition of a business, we allocate the purchase consideration paid to acquire the business to the assets and liabilities acquired based on estimated fair values at the acquisition date, with the excess of purchase price over the estimated fair value of the net assets acquired recorded as goodwill. If during the measurement period (a period not to exceed 12 months from the acquisition date) we receive additional information that existed as of the acquisition date but at the time of the original allocation described above was unknown to us, we make the appropriate adjustments to the purchase price allocation in the reporting period that the amounts are determined.

**Goodwill**

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include significant changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.

The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than it's carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.

**Intangible Assets**

Intangible assets consist of client list, trademark and non-compete intangibles that result from the acquisition of veterinary hospitals or practices. Client list intangible represent the value of the long-term client relationship from the veterinary hospitals and practices. Trademark intangible assets represent the value associated with the brand names in place at the date of the acquisition. Non-compete intangible assets represent the value associated with non-compete agreements for former employees and owners in place at the date of the acquisition. The client lists and trademark are included in other intangibles, net reported in the balance sheet which are being amortized over a 5-year term based on the estimated economic useful life of the client list and trademark. The non-compete intangible asset included in other intangibles, net is amortized over a 2-year term based on the estimated useful life of the asset. The amortization of the intangible asset is computed using the straight-line method. The intangibles are evaluated for impairment on an annual basis or more frequently whenever events or circumstances occur indicating that the carrying amount may not be recoverable.

The Company uses the Multi-Period Excess Earnings Method ("MPEEM"), a form of the income approach to determine the fair market value of the client list (customer relationship) intangible assets acquired as part of the acquisitions of veterinary hospitals or practices. The principle behind the MPEEM is that the value of an intangible asset is equal to the present value of the incremental after-tax cash flows attributable only to the subject intangible asset after deducting contributory asset charges ("CAC").

The principle behind a contributory asset charge is that an intangible asset "rents" or "leases" from a hypothetical third party all the assets it requires to produce the cash flows resulting from its development, that each project rents only those assets it needs (including elements of goodwill) and not the ones that it does not, and that each project pays the owner of the assets a fair return on (and of, when appropriate) the fair value of the rented assets. Thus, any net cash flows remaining after such charges are attributable to the subject intangible asset being valued. The incremental after–tax cash flows attributable to the subject intangible asset are then discounted to their present value. CACs generally reflect an estimate of the amount a typical market participant would have to pay to use these contributory assets to generate income with the intangible asset.

The most significant assumptions used in our application of the MPEEM and in the valuation analysis of acquired client lists are:

● A useful life of 15 years where after 10 years the remaining customer base results in small positive cash flows and no terminal value was calculated.

● A discount rate of 19.6% was selected to calculate the present value of the prospective after–tax cash flows associated with the customer base and business development relationships.

● We utilized an annual Company sales retention rate of 74.0% (Veterinary Services industry rate) for the Customer Base.

● The contributory asset charges are based on returns (8.3% to 19.7%) for Net Working Capital (normalized); Fixed Assets; Assembled Workforce; Trade Name; and Non-Competes.

As of December 31, 2024 our intangible assets and goodwill balances were as follows:

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| | |
|:---|:---|
|  | **December 31,**<br>**2024** |
| Client List | $1916444 |
| Noncompete Agreement | 398300 |
| Trademark | 1047792 |
| Other Intangible Assets | 45836 |
| Goodwill | 8022082 |
|  | $11430454 |

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Our valuations of the intangible assets apart of our veterinary clinics and animal hospital acquisitions has a relatively small value allocated to the client list (customer relationship) due to our use of the Veterinary Services industry rate of 74% for the retention rate in our valuations. An increase in the rate by 6% to 80% in our valuation would result in an increase of approximately $100 thousand to the client list and a decrease of approximately $100 thousand to goodwill. We have elected to use the industry standard as our Company has minimal historical operations with less than 3 years of revenue producing activities through December 31, 2023. The company acquired Valley Veterinary Services on November 8, 2023. Management continues to evaluate the inputs used in our valuations based on quantitative and qualitative information available to the Company. The Company did not make any acquisitions during the year ended December 31, 2024.

**Off-Balance Sheet Arrangements**

We do not have any off-balance sheet arrangements.

**OUR BUSINESS**

**Overview** 

Inspire owns and operates veterinary hospitals throughout the United States. The Company specializes in small animal general practice hospitals which serve all manner of companion pets, emphasizing canine and feline breeds in addition to one location providing equine care. As the Company expands, it expects to acquire additional veterinary hospitals, including general practice, mixed animal facilities, and critical and emergency care.

The Company completed its initial public offering on August 31, 2023 and its shares of Class A Common Stock are quoted on The Nasdaq Capital Market under the symbol "IVP."

As of the date of this prospectus, the Company has fourteen veterinary hospitals located in nine states. Inspire Veterinary has expanded and plans to further expand through acquisitions of existing hospitals which have the financial track record, marketplace advantages and future growth potential. Because the Company leverages a leadership and support structure which is distributed throughout the United States, acquisitions are not centralized to one geographic area.

Services provided at the Company's hospitals include preventive care for companion animals consisting of annual health exams which include: parasite control; dental health; nutrition and body condition counseling; neurological examinations; radiology; bloodwork; skin and coat health and many breed specific preventive care services. Surgical offerings include all soft tissue procedures such as spays and neuters, mass removals, splenectomies and can also include gastropexies, orthopedic procedures and other types of surgical offerings based on a doctor's training. In many locations additional means of care and alternative procedures are also offered such as acupuncture, chiropractic and various other health and wellness offerings.

**Industry Overview and Market Opportunity**

Inspire Veterinary expects to target a five to-unit per year acquisition pipeline throughout the United States. Additional growth through the acquisition of newer practices or De Dovo growth is not expected to be ruled out but management's emphasis is expected to focus on acquiring existing veterinary hospitals throughout the United States. In years two through five the Company will seek to expand purchases beyond the small companion animal only hospital to include mixed animal (including additional equine care) and add specialty care to our geographies. With over 28,000 veterinary hospitals in the United States and less than 25% of those having been consolidated, management believes large upside potential exists and the addressable market for new acquisitions is large.

**Our Strategy**

With an emphasis on general practice hospitals in its first seven to eight quarters, the Company expanded into purchase of mixed animal hospitals in late 2022, adding equine care to its mix. Further, the Company intends to continue to the due diligence toward acquisition toward strategically acquiring existing general practice, specialty hospitals and/or expand existing locations to include emergency care and more complex surgeries, holistic care and comprehensive diagnostics which allow it to offer more complex surgeries and internal medicine work ups.

We account for acquisitions under the acquisition method and are required to measure identifiable assets acquired and liabilities assumed of the acquiree at the fair values on the closing date. The Company makes an initial allocation of the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets and assumed liabilities.

**Selling and Marketing**

Inspire Veterinary has established contacts with most major veterinary brokerages and has purchased locations in every region of the United States, providing visibility and establishing a pipeline of deals which allow the Company to extend a letter of intent on approximately 10% of the hospitals which are analyzed. The acquisitions and valuation team is sufficient for current levels of acquisition activity and personnel have already been identified for expanding this team to provide deeper integration at industry events, generating organic leads and leveraging deep relationships with service and product suppliers across the industry.

We depend upon the skills, knowledge and experience of our management personnel, as well as that of our other employees, advisors, consultants and contractors, none of which are patentable. To help protect our know-how, we require all of our employees, consultants, advisors and other contractors to enter into customary confidentiality agreements that prohibit the disclosure of confidential information.

**Competition**

The veterinary industry, as of early 2023, consists of over one dozen national consolidators and approximately 25 regional consolidators. These groups combined currently own or operate around 7,500of the nearly 30,000 veterinary hospitals in the United States.

Competitors range in size from the largest such as Mars and NVA, which collectively own approximately 4,000 hospitals, to other national and regional groups such as Pathway/Thrive, VetCor, Southern Vet Partners, Community Veterinary Partners, and others. Growth in recent years has centered primarily on mid-sized and small platforms coming into the industry and/or acquiring existing hospitals in order to achieve location numbers between 50 and 200 units. In select cases, large to mid-sized groups have absorbed competitors in order to grow numbers or move into other modes of care. Examples include Pathway's purchase of Thrive or NVA acquiring Compassion First and Southern Vet Partners acquiring Mission Vet. More than 30 groups comprise those entities owning less than 100 individual hospitals.

Increasingly, owner/operators of veterinary groups are also purchasing facilities and technology within the space, such as Pathway's purchase of Vetspire Practice software. Additionally, as the line between general practice and more specialized modes of care becomes less defined, formerly general practice-only groups are branching into additional service offerings.

Competitors of the Company possess the advantages of years in operation and the resulting brand awareness which comes with their size and time in existence. Additional advantages are the financial and infrastructure resources possessed by larger competitors such as Mars, Pathway, Southern Vet Partners, Community Vet Partners and others.

The company has an opportunity to differentiate itself from these competitors via the following:

● A broad equity offering to a large group of employees which is not offered at other veterinary entities via an Employee Stock Option Plan.

● A personalized and approach to purchasing and integrating hospitals into the Company which is not matched by other groups. Because the Company works closely with acquired locations to allow them to sustain their own practices, methods and identities, this is an approach preferred by sellers to the more homogenized model used by competitors.

● A coaching and development-based workflow which is customized for each clinician and professional, all of which provide a more one to one environment than the larger consolidators can provide.

● A valuation process based on a 3-year look back and conservative enterprise values design to support long term Return On Investment versus relying on trailing twelve measures or buying at inflated multiples of EBITDA or revenue.

**Government Regulation**

With practice acts that govern veterinary care and ownership guidelines on a state-by-state basis, Inspire Veterinary has processes and structures in place to provide the ability to own and operate in any state where it chooses to acquire locations. Governmental regulations regarding care for pets while also preserving pets as property are favorable to the continued growth of the veterinary channel.

The following descriptions of regulations constitute all applicable regulations to the Company's operations.

*Veterinary Ownership Restrictions in Certain States*

 

The State of Texas' Veterinary Licensing Act's, or V.T.C.A., Occupations Code Section 801.506 – *Prohibited Practices Relating to Certain Entities* prohibits non-licensed veterinary persons from owning or operating veterinary clinics in the state of Texas. The Company currently operates two clinics in Texas and believes it is in compliance with applicable state law.

The State of Indiana' Indiana Code, Article 38.1 Veterinarians, contains very little guidance dealing directly with veterinary practice ownership. There is no statute or regulation that explicitly defines what it means to have "ownership" of a veterinary practice in Indiana. Generally, if the veterinary clinic is owned by a limited liability company, at least one member of the limited liability company must be a veterinarian, subject to the discretion of the Indiana Board of Veterinary Medical Examiners. The Company operates one clinic in Indiana and believes it is in compliance with applicable state law.

*Limitations for Duties for Non-Credentialed Employees*

New York State, and certain other states, have language in their individual veterinary practice acts which require credentials in the form of licensure or certifications to be held by veterinary personnel who perform certain duties. This requirement varies by state, with many states having very few limitations of duties which can be performed by non-credentialled personnel while other states (such as New York) utilize language in their practice acts which can be interpreted as a blanket prohibition against employees without certification working with pets. The Company does not currently operate any clinics in New York State. There can be no assurance, however, that the Company may not seek to acquire a clinic or clinics in the New York State.

*Drug Enforcement Agency (DEA) Regulations*

With veterinary care requiring the use of some controlled and scheduled drugs, utilization logs and security procedures must be maintained in order for hospitals and clinics to be compliant with federal law. Inventory of controlled drugs is conducted, and scheduled drugs are kept secured and locked for access and use, by Company veterinarian or acceptable registered technician only pursuant to applicable federal law.

In each of these cases, Inspire has and has created structures which conform to legal standards and mitigate risk so as to allow the Company to acquire and operate in the states in which it chooses to do so.

**Employees**

As of November 24, 2025, we had 132 employees. None of our employees are represented by labor unions or covered by collective bargaining agreements.

**Properties**

With a decentralized leadership team, our company does not have a physical headquarters, but rather, has a distributed leadership team working from home offices across several states.

***Chiefland Animal Hospital (CAH)***

The real estate underlying Chiefland Animal Hospital is located at 2630 North Young Boulevard, Chiefland, Florida, and is owned by IVP FL Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $279,500 and was financed by WealthSouth, a division of Farmers National Bank ("WealthSouth").

***Pets & Friends Animal Hospital LLC (P&F)***

The real estate underlying Pets & Friends Animal Hospital is located at 3625 Baltimore Ave, Pueblo, Colorado, and is owned by IVP CO Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $216,750 and was financed by WealthSouth.

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***Advanced Veterinary Care of Pasco, LLC (AVCP)***

The real estate underlying our Advanced Veterinary Care of Pasco facility, located at 12116 Cobble Stone Drive, Hudson, Florida, is leased from Remappa Family Limited Partnership for one year with two additional possible three-year renewals. The initial rent in the first year of the lease is $2,350 per month increasing in annual increments for a total of 0.75% over ten years. The lease consists of 2,442 square feet of commercial space zoned to permit the provision of veterinary services.

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***Lytle Veterinary Clinic, Inc. (LVC)***

The real estate underlying Lytle Veterinary Clinic is located at 63245 Texas State Highway 132, Lytle, Texas, and is owned by IVP TX Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $780,000 and financed by WealthSouth.

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***Southern Kern Veterinary Clinic, Inc. (SKVC)***

The real estate underlying Southern Kern Veterinary Clinic is located at 4455 West Rosamond Boulevard, Rosamond, California, and is owned by IVP CA Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $500,000 and financed by WealthSouth.

***Bartow Animal Hospital***

The real estate underlying Bartow Animal Hospital is located at 1515 US Highway 17 South, Bartow, Florida, and is owned by IVP FL Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $350,000 and financed by WealthSouth.

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***Family Pet Care***

The real estate underlying Family Pet Car is located at 16111 Kensington Dr, Sugar Land, TX 77479, and is leased from WSE Town Center LLC.*,* for a ten-year term, with optional renewals thereafter. The rent is $8,166.67 per month. The lease consists of approximately 4,000 square feet of commercial space zoned to permit the provision of veterinary services.

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***Aberdeen Veterinary Clinic***

The real estate underlying Aberdeen Veterinary Clinic is located at 728 South Philadelphia Boulevard, Aberdeen, Maryland, and is leased from H R Fritz LLC for a five-year term, with three additional optional 5-year renewals. The rent is $4,167 per month, increasing 3% annually. The lease consists of 2,653 square feet of commercial space zoned to permit the provision of veterinary services.

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***All Breed Pet Care***

The real estate underlying the All Breed Pet Care facility is located at 7501 Peachwood Drive, Newburgh, Indiana, and is owned by IVP IN Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $1,200,000 and was financed by WealthSouth.

***The Pony Express Veterinary Hospital***

The real estate underlying The Pony Express Veterinary Hospital is located at 893 Lower Bellbrook Road, Xenia, Ohio and is owned by IVP TX Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $500,000 and was financed by WealthSouth.

***The Old 41 Animal Hospital***

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The real estate underlying The Old 41 Animal Hospital facility is located at 27551 Old 41 Road, Bonita Springs, Florida and 27567 Old 41 Road, Bonita Springs, Florida, and is owned by IVP FL Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $800,000 and was financed by WealthSouth.

***Valley Veterinary Services***

The real estate underlying Valley Veterinary Services facility is located 408 Grace Lane, Rostraver Township, Pennsylvania 15012 (Parcel Nos. 56-12-00-0-148 and 56-12-00-0-144) and is owned by IVP PA Properties, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $590,000 and was financed by WealthSouth.

***Debary Animal Clinic***

 ****

The real estate underlying the Debary Animal Clinic is located at 30 S US Hwy 17-92, Debary, Florida 32713 (Parcel No. 803402010030) and 24 S Charles R Beall Blvd, Debary, Florida 32713 (Parcel No. 803402010040) and is owned by IVP FL Holding Company, LLC, a 100%-owned subsidiary of the Company. The property was purchased for $1,132,000 and was financed by Lancer Lender RS LLC.

**Legal Proceedings**

We may from time to time become a party to various legal or administrative proceedings arising in the ordinary course of our business. As of the date hereof, neither we nor any of our subsidiaries is a party to any pending legal proceedings, nor are we aware of any such proceedings threatened against us or our subsidiaries.

**MANAGEMENT AND BOARD OF DIRECTORS**

**Executive Officers and Directors**

The names of our executive officers and directors and their ages and positions as of the date of this prospectus are set forth below.

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| Kimball Carr | 55 | Chair of the Board, President and Chief Executive Officer |
| Richard Frank | 57 | Chief Financial Officer |
| Lynley Kees | 54 | Chief People Officer |
| Laura Johnson | 43 | Vice President of Operations |
| Alexandra Quarti | 51 | Vice President of Medical Operations |
| Larry Alexander | 45 | Director |
| Phillip Balatsos | 48 | Director |
| Charles Stith Keiser | 41 | Director |
| Anne Murphy | 59 | Director |
| Erinn Thomas-Mackey, DMV | 38 | Director |
| Timothy Watters | 63 | Director |

---

 ****

***Kimball Carr*** — Mr. Carr has served as our President and Chief Executive Officer since February 2021 and as Chair of the Board of Directors since May 2025. Mr. Carr has had a varied career of over thirty years in many roles with private and public business entities. With early education in journalism and continuing education at the University of Virginia's Darden Business School, Mr. Carr's leadership career includes elevated roles for Starbucks Coffee Company, Mars Incorporated and Trupanion Medical Insurance. From March 2018 through the present, Mr. Carr served as President of Ocean 35 Inc., owner of retail brands focused on the sports of surfing and skateboarding as well as education and support of youth participation in the sports. From March 2018, Mr. Carr was the owner and founder of Grom Coast Surf & Skate, a regional commercial surf shop (subsequently closed). From December 2019 through February 2021, Mr. Carr was the director of learning and development of Blue Heron Consulting, offering comprehensive operational, financial, and medical team coaching for veterinarians and animal health care industry professionals across the country. During his tenure as a business leader, he has built multi-year growth strategies, led teams of over 2,000 professionals and delivered collective revenues in excess of $1 billion. He brings deep experience in veterinary and field operations, start-up processes, leadership development, growth strategies and turn arounds. He has led the acquisition and de novo opening of hundreds of company units over the course of his career and has built highly effective field leadership teams which have delivered industry-leading results. His connection to the pet care industry is highlighted by deep relationships he has across the sector, providing access to talent which Inspire intends to leverage. Mr. Carr's volunteer work includes service as President of the Banfield Associate Relief fund, an employee assistance program founded in relation to his role in the recovery for Banfield Associates from Hurricane Sandy in the Northeast United States. Mr. Carr attended Tidewater Community College in October 1991 and attended the University of Virginia Darden Business School executive master's of business administration from 2004 to 2006. We believe Mr. Carr is qualified to serve on the board due to his extensive background in retail business, his demonstrated success in entrepreneurial enterprises and his more than a decade of expertise in the veterinary medicine services industry.

***Richard Frank*** — Mr. Frank has served as our Chief Financial Officer since joining the Company in January 2023. From 2021 through December 2022, Mr. Frank was Chief Executive Officer of Purcell Flanagan Hay & Greene, a law firm based in Jacksonville, Florida. From 2020 through 2021, he served as Chief Financial Officer of Skygeek.com, an aviation parts e-commerce company. From 2019 to 2020, he was an independent consultant with PKF O'Connor Davies, an accounting and advisory firm. Mr. Frank also served as Chief Operating Officer and Chief Financial Officer of Beval Saddlery, LLC, a private equity owned multi-location retailer/wholesaler and e-commerce company from 2014 through 2019. Earlier in his career he was engaged in senior management positions with Blue Chip Farms, LLC, the largest equine breeding farm in New York State, Medical Recruitment Solutions, Inc., a private equity owned medical staffing start-up enterprise, Indotronix International Corporation, an information technology staffing company, Microcast, Inc., a video streaming start-up enterprise, and Factset Research Systems, Inc., a SaaS financial information company with operations in the United Kingdom, Australia and Japan. He has over twenty years of experience directing all aspects of enterprise-wide finance, operations, business development, marketing, administration and customer service, including experience in private equity owned companies, start-ups and companies with greater than $100 million per year in revenue. Mr. Frank graduated with a Bachelor of Science in Finance in 1992 from Mercy College in Yorktown, New York.

***Lynley Kees*** — Ms. Kees has served as our Chief People Officer since April 2025. Prior to that, she was Vice President of Human Resources for the Company since January 2023. Prior to joining the company, Ms. Kees served as a strategic human resources consultant since January 2020, advising executive leadership across hospitality, technology, and retail sectors. From June 2018 to February 2019, Ms. Kees served as Vice President of People at Puppet Inc., where she led a global team delivering programs in talent acquisition, total rewards, HR operations, diversity and inclusion, and people strategy. Prior to that, she was Senior Director of Human Resources Business Partner at Nike Inc. from September 2014 to September 2017, supporting global operations and driving integrated team and talent strategies. Ms. Kees also served as Vice President of Hilton Worldwide's Human Resources Consulting Group from June 2009 to September 2014, where she played a key role in the company's successful re-launch as a publicly traded entity in December 2013. Earlier in her career, she held leadership roles at EYA LLC, Grant/Morgan Associates, and Crestline Hotels & Resorts, where she supported both field operations and corporate headquarters. Ms. Kees earned a fellowship from and holds a Master of Education in Higher Education Administration from the University of South Carolina and a Bachelor of Arts in International Relations and Economics from Lehigh University, where she was awarded the Trustee Scholarship.

***Laura Johnson*** — Mrs. Johnson has served as the Vice President of Operations for the Company since September 2024. She has more than sixteen years of progressive leadership experience in the veterinary services industry, with a proven track record of managing large-scale, multi-site operations, improving profitability, and building collaborative, high-performing teams. From April 2023 to August 2024, Mrs. Johnson served as Vice President of Operations at Western Veterinary Partners, overseeing a $200 million revenue portfolio across more than 150 veterinary practices in the Western United States. Prior to that, she served as Senior Director of Operations from January 2023 to April 2023, and as Director of Operations from October 2021 to January 2023, with responsibilities for revenue portfolios ranging from $60 million to $90 million and oversight of up to 60 veterinary practices. From February 2019 to October 2021, Mrs. Johnson was Manager of Regional Operations at National Veterinary Associates, responsible for the operations and profitability of 22 practices in Utah and Nevada generating more than $60 million annually. She first joined National Veterinary Associates in October 2018 as Associate Manager of Regional Operations, managing six hospitals representing over $18 million in annual revenue. Mrs. Johnson began her career as co-founder of a family-owned, veterinarian-led nationally accredited e-commerce veterinary pharmacy, licensed in all 50 states and recognized by both the National Association of Boards of Pharmacy (Vet-VIPPS) and the Pharmacy Compounding Accreditation Board (PCAB), where she oversaw its launch, scale, marketing strategy, and execution for the first eight years. Her academic background includes earlier education at the Franklin College of Arts and Sciences at the University of Georgia, complemented by ongoing studies in applied business and technology solutions at Arizona State University.

***Alexandra Quarti*** — Ms. Quarti has served as the Vice President of Medical Operations for the Company since June 2022. Dr. Quarti has over fifteen years of progressive leadership experience in veterinary medicine and operations, spanning both private practice and multi-site corporate environments. From 2019 until she joined the Company, Dr. Quarti served as Northeast Region Director of Operations for Community Veterinary Partners (CVP), where she led all aspects of medical and business operations for 24 hospitals. Her leadership encompassed financial management, talent development, and medical quality initiatives, with a strong emphasis on aligning clinical excellence with sustainable business outcomes. Dr. Quarti began her veterinary career in private practice in Old Lyme, Connecticut from 2007 to 2008 before joining Banfield Pet Hospitals in 2008. During her eleven-year tenure with Banfield, she was promoted from Associate Doctor to Director of Veterinary Quality in 2009, where she oversaw medical quality, compliance, and operational performance for more than 20 hospitals across New England. In this role, she developed and implemented systems that elevated patient care standards, drove hospital growth, and supported teams of veterinarians and paraprofessionals in achieving consistent results. Dr. Quarti earned her Doctor of Veterinary Medicine degree from Ross University School of Veterinary Medicine in 2007 and completed her clinical year at Cornell University College of Veterinary Medicine. Prior to veterinary school, she gained broad industry experience as both a veterinary technician and an Animal Control Officer, grounding her leadership approach in a deep understanding of all levels of veterinary care. Dr. Quarti currently maintains active veterinary licenses in 9 different states.

***Larry Alexander*** — Mr. Alexander has served as a director of the Company since August 2023. He is currently the Vice President of Operations for CarepathRx, holding that role since January 2022. Previously, Mr. Alexander served as Managing Director of First Financial Bank from September 2017 through December 2021. Earlier in his career, he worked for McKesson Corporation from June 2002 through 2017, most recently as Vice President, Strategic Solutions and National Accounts from January 2010 through August 2017. Mr. Alexander brings over 20 years of experience, serving in senior leadership positions in Fortune 5, private equity, non-profit, and privately held companies, with an outstanding record of business growth and profitability across multiple industries. His career has focused on developing people and engaged and high performing teams. Mr. Alexander's proven results and leadership experience include leading multi-billion dollar negotiations, and facilitating M&A engagements and new business development. He has revived and started new businesses, with a deep focus on culture and growth. He gives generously of his time by serving many worthy organizations; chairing capital campaigns in his community; instituting college scholarship programs; leading hurricane disaster relief efforts; guest lecturing at universities; and serving on several boards of directors. Mr. Alexander graduated with a Bachelor of Science Degree in Industrial Distribution in May 2002 from Texas A&M University. We believe Mr. Alexander is qualified to serve on the Board in light of his decades of experience in business operations in public and private enterprises across multiple industries.

***Phillip Balatsos*** — Mr. Balatsos joined the Board in October 2024. Since August 2022, Mr. Balatsos has served as the Vice President of Foreign Exchange Emerging Markets Rates Sales/Trading with XP Investments US Inc., for which Mr. Balatsos provides coverage and execution of currency trading in emerging markets as well as commodity and fixed income products and derivatives for global macro hedge funds. In September 2018, Mr. Balatsos founded LAPH Hospitality, where he served as an Operator until August 2022. During his time with LAPH Hospitality, Mr. Balatsos operated a multi-location café/catering business. Mr. Balatsos previously served as a member of the board of directors of Sadot Group Inc. and sat on the audit and finance committees during his term. Prior to his tenure in hospitality, Mr. Balatsos held various positions on Wall Street including Vice President, Foreign Exchange Sales/Trading for Credit Suisse; Director, Foreign Exchange Hedge Fund Sales for Barclays Capital and Financial Advisor for Stifel Nicolaus & Co.. Mr. Balatsos graduated from Skidmore College with a Bachelor of Science in Business Administration and from the Institute of Culinary Education. We believe Mr. Balatsos is qualified to serve on the Board due to his vast experience in the financial industry and his deep understanding of markets.

***Charles Stith Keiser*** — Mr. Keiser has served on the Board since January 2022 and served as the Company's Chief Operating Officer from January 2023 to November 2023. He has served as Chief Executive Officer of Blue Heron Consulting, a veterinary consulting company serving hospitals of all sizes and specialties across North America, since March 2015. Earlier in his career, he served as Director of Student Programs for the American Animal Hospital Association from September 2011 through March 2015. He grew up in veterinary medicine as the son of a practice owning veterinarian and has spent his entire career in the industry. In addition to his employment, Mr. Keiser continues to volunteer as a facilitator and lecturer for professional skills curriculum at veterinary schools across the country. Mr. Keiser continues to develop and deliver professional development content as an adjunct faculty member at several U.S. veterinary schools. Mr. Keiser's volunteer experience includes serving as Chair of VetCAN (Veterinary Career Advisory Network), terms as President of VetPartner's Career Development and Practice Management Special Interest Groups, participation in Washington State University's CVM "Diagnostic Challenge" and a seat on the AVMA's Economics Advisory Research Council Financial Literacy task force. Mr. Keiser has served in the veterinary profession since his graduation from Hope College with a degree in Business, Management and Accounting in 2008. We believe Mr. Keiser is qualified to serve on the Board due to his substantial experience in the practice of veterinary medicine and his leadership roles teaching and serving in veterinary schools and industry groups.

***Anne Murphy*** — Ms. Murphy has served on the Board since August 2023. Since January 2021, Ms. Murphy has served as Vice President, Business Solutions and Applications at American Electric Power. Previously, Ms. Murphy served as the Chief Information Officer for Best Buy Health and Greatcall, Inc., from November 2017 through March 2020, and Chief Information Officer for Banfield Pet Hospital from 2015 through 2017. Earlier in her career, Ms. Murphy served as Technology Vice President/Senior Director at Target Corporation from 2008-2014. Ms. Murphy is the owner and president of a consulting company, Claro Vista LLC, since 2014. Ms. Murphy brings over 30 years of technology and transformational leadership experience in public, private, and private equity companies supporting utility, retail, direct to consumer and veterinary sectors. Ms. Murphy's volunteer work includes serving as Board Trustee and Operations Committee Chair at United Through Reading since 2018, Board member for Banfield Foundation in 2017, Habitat for Humanity Women's Build from 2013-2014 and Ordway Circle of Stars Board member from 2008-2010. Ms. Murphy graduated from University of St. Thomas in 2004 with a Master's of Business of Administration, and graduated from Metropolitan State University in 1998 with a Bachelor of Science in Business Administration. We believe Ms. Murphy is qualified to serve on the Board due to her multiple decades in business administration and technology leadership roles in a variety of industries, including veterinary services, and her demonstrated commitment to public service.

***Erinn Thomas-Mackey, DVM*** — Dr. Thomas-Mackey joined the Board in August 2023. She has been the Founder and Managing Member of SeaPath Advisory LLC from 2022 to present, Managing Member and Founder for Thomas-Mackey Veterinary Service from 2021 to present, and Managing Member and Founder of TwoMacks Properties LLC from 2019 to present. Earlier in Dr. Thomas-Mackey's career she was employed as an Associate Emergency Veterinarian at Animal Emergency Service, a privately owned emergency veterinary practice in Long Island, NY from August 2017 to October 2021 and as an Associate General Practice Veterinarian at Assisi Veterinary Hospital, a privately owned veterinary practice in Malverne, NY from June 2015 to June 2017. While working as a full-time veterinarian, Dr. Thomas-Mackey started her per-diem veterinary business and real estate investment company. She brings years of hands-on experience in both emergency veterinary medicine and general veterinary practice along with the unique understanding of the day-to-day needs and challenges of both veterinary doctors and practice owners alike. In addition, Dr. Thomas-Mackey has successfully navigated everyday issues practice owners face around staffing needs, optimizing practice flow, and driving revenue to increase profit margins. She also has hands-on experience with negotiating real estate deals, property evaluation, and property management. Dr. Thomas-Mackey graduated from the Tuskegee University College of Agriculture, Environment and Nutrition Sciences in 2010 with a Bachelor of Science in Biology and a Bachelor of Animal, Poultry, and Veterinary Science, and from the Tuskegee University College of Veterinary Medicine in 2014 with a Doctor of Veterinary Medicine. We believe Dr. Thomas-Mackey's broad experience in both the practice of veterinary medicine and ownership and management of veterinary practices and veterinary practice real estate, as well as her demonstrated educational and professional excellence, qualifies her to serve on the Board.

***Timothy Watters*** — Mr. Watters has served on the Board since August 2023. Mr. Watters currently serves as Chief Financial Officer of North Fork Native Plants, a wholesale plant nursery serving the Intermountain West and Pacific Northwest, a position he has held since July 2019. Previously, Mr. Watters served as Chief Operating Officer of North Fork Native Plants from May 2008 through June 2019. Earlier in his career, Mr. Watters owned a wholesale camping business, SKI International, Inc., from June 1994 through January 2008. He also worked in finance serving as Vice President of A.G. Edwards and Sons in St. Louis, Missouri from January 1990 through May 1994 and Vice President at PNC Financial Corp in Philadelphia, PA from September 1985 through September 1990. Mr. Watters brings over 38 years of experience in finance and small business ownership. Mr. Watters' volunteer work includes service as Board Chair of the Community Foundation of Teton Valley, Board Chair of the Teton Valley Community School, Treasurer of Friends of the Teton River and Chair of the Teton County Planning and Zoning Commission. Mr. Watters graduated from Denison University in June 1985 with a Bachelor of Arts in Economics. We believe Mr. Watters is qualified to serve on the Board in light of his many decades of leadership of multiple commercial businesses and financial services firms.

We are not aware of any of our directors or executive officers being involved in any legal proceedings in the past ten years relating to any matters in bankruptcy, insolvency, criminal proceedings (other than traffic and other minor offenses) or being subject to any of the items set forth under Item 401(f) of Regulation S-K.

**Board Composition, Independence and Leadership Structure**

Our Board currently consists of eight members. Our directors hold office until their successors have been elected and qualified or until the earlier of their death, resignation or removal. There are no family relationships among any of our directors or executive officers. Our Board held four meetings in 2024. Each director attended at least 75% of the aggregate of the total number of meetings held by our Board and the total number of meetings held by all committee of the Board on which he or she served, during the period for which he or she served. Directors are encouraged, but not required, to attend our annual meeting of stockholders. Three of the eight then-serving members of our Board attended the 2024 annual meeting of stockholders.

Our Board has reviewed the independence of each director and considered whether any director had or has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities. As a result of this review, our Board has determined that all of our directors, other than Kimball Carr, our Chair of the Board, Chief Executive Officer and President, and Charles Stith Keiser, are "independent directors" and meet the independence requirements under the listing requirements of the Nasdaq Stock Market and the rules and regulations of the Securities and Exchange Commission.

The Board has three standing committees — Audit, Compensation and Governance and Nominating. The membership of each of the Board committees is comprised of all independent directors, with each of the committees having a separate chairman, each of whom is an independent director. Each committee operates under a written charter that has been approved by our Board. Current copies of the charters for each committee are available on the investor relations section of our corporate website, *https://ir.inspirevet.com/governance-documents/*. Our non-management members of the Board meet in executive session at each quarterly board meeting.

The Board believes it is important to retain its flexibility to allocate the responsibilities of the offices of the Chair of the Board and the Chief Executive Officer in a way that is in the best interest of the Company at any given point in time. As such, the Board does not have a policy on whether the role of the Chief Executive Officer and Chair of the Board should be separate, or, if it is to be separate, whether the Chair should be selected from the non-management directors or be an employee. We currently operate with one individual, Kimball Carr, serving as Chief Executive Officer and Chair of the Board. The Board believes that combining the Chief Executive Officer and Chair of the Board positions is the right corporate governance structure for the Company at this time because it most effectively uses Mr. Carr's experience and knowledge of the Company, places him in the best position to focus the independent directors' attention on the issues of greatest importance to the Company and its stockholders, and provides the Company with unified leadership. As part of the Board's annual assessment process, the Board evaluates our Board leadership structure to ensure that it remains appropriate. The Board recognizes that there may be circumstances in the future that would lead it to separate the roles of Chief Executive Officer and Chair of the Board, but believes that the absence of a policy requiring either the separation or combination of these roles provides the Board with the greatest flexibility to determine the best leadership structure.

The Board has not appointed a lead independent director. However, our non-management members of the Board meet in executive session without the Chair at each quarterly board meeting.

**Board Risk Oversight**

Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. Management is responsible for the day-to-day management of risks we face, while the Board, as a whole and through its committees, has responsibility for the oversight of risk management. In its risk oversight role, the Board has the responsibility for ensuring that the risk management processes designed and implemented by management are adequate and functioning as designed.

The Board believes that establishing the right "tone at the top" and that full and open communication between executive management and the Board are essential for effective risk management and oversight. The Company's senior management usually attends our regular Board meetings and keeps the Board apprised of material risks and provides the directors access to all information necessary for them to understand and evaluate how these risks interrelate, how they affect us, and how management addresses those risks. Our CEO communicates frequently with members of the Board to discuss strategy and the challenges we face. Our CEO and senior management are available to address any questions or concerns raised by the Board on risk management-related and any other matters.'

**Board Committees and Charters**

The following table identifies the current independent and non-independent Board and Committee members:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name** | **Independent** | **Independent** | **Audit** | **Audit** | **Compensation** | **Compensation** | **Governance and <br> Nominating** | **Governance and <br> Nominating** |
| Kimball Carr |  |  |  |  |  |  |  |  |
| Larry Alexander |  | x |  | x |  |  |  | x |
| Phillip Balatsos |  | x |  | x |  |  |  |  |
| Charles Stith Keiser |  |  |  |  |  |  |  |  |
| Anne Murphy |  | x |  |  |  | x |  |  |
| Erinn Thomas-Mackey, DMV |  | x |  |  |  | x |  |  |
| Timothy Watters |  | x |  | x |  |  |  | x |

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*Audit Committee*

The current Audit Committee is composed of three independent directors: Timothy Watters, Phillip Balatsos and Larry Alexander, with Mr. Watters serving as Chair. Each member of the Audit Committee is an independent director as defined by the rules of the Securities and Exchange Commission and the Nasdaq Stock Market. The Audit Committee has the sole authority and responsibility to select, evaluate and engage independent auditors for the Company. The Audit Committee reviews with the auditors and with the Company's financial management all matters relating to the annual audit of the Company. The Audit Committee also monitors the integrity of our financial statements, the independent registered public accounting firm's qualifications and independence, the performance of our internal audit function and the auditors, and our compliance with legal and regulatory requirements. The Audit Committee also meets with our auditors to review the results of their audit and review of our annual and interim financial statements. During 2024, our Audit Committee met three times.

Our Board determined that Mr. Watters is qualified as an Audit Committee Financial Expert, as that term is defined by the rules of the Securities and Exchange Commission, in compliance with the Sarbanes-Oxley Act of 2002 and that each of the members of the Audit Committee is able to read and understand fundamental financial statements.

*Compensation Committee*

 

The Compensation Committee, which currently consists of Anne Murphy and Erinn Thomas-Mackey, with Ms. Murphy serving as Chair. Each member of the Compensation Committee is a non-employee member of our Board and our Board has determined that each member of our Compensation Committee meets the requirements for independence under the requirements of the Nasdaq Stock Market.

The Compensation Committee reviews, recommends and approves salaries and other compensation of the Company's executive officers, and administers the Company's equity incentive plans (including reviewing, recommending and approving stock option and other equity incentive grants to executive officers). In addition, the Compensation Committee reviews and approves the compensation of non-employee directors. The Compensation Committee may, in its sole discretion and at the Company's cost, retain or obtain the advice of a compensation consultant, legal counsel or other adviser. The Compensation Committee is directly responsible for the appointment, compensation and oversight of the work of any compensation consultant, legal counsel and other adviser retained by the committee.

During 2024, our Compensation Committee met four times.

*Governance and Nominating Committee*

 

The Governance and Nominating Committee consists of Larry Alexander and Timothy Watters, with Mr. Alexander serving as Chair. Each member of the Governance and Nominating Committee meets the independence requirements of the Nasdaq Stock Market. The Committee develops and recommends to the Board a policy regarding the consideration of director candidates recommended by the Company's stockholders and procedures for submission by stockholders of director nominee recommendations.

The Governance and Nominating Committee identifies individuals qualified to become members of the Board, consistent with criteria approved by the Board; recommends to the Board the director nominees for the next annual meeting of stockholders or special meeting of stockholders at which directors are to be elected; recommends to the Board candidates to fill any vacancies on the Board; develops, recommends to the Board, and reviews the corporate governance guidelines applicable to the Company; and oversees the evaluation of the Board and management.

In selecting and recommending candidates for election to the Board or appointment to any committee of the Board, the Committee does not believe that it is appropriate to select nominees through mechanical application of specified criteria. Rather, the Committee shall consider such factors at it deems appropriate, including, without limitation, the following: personal and professional integrity, ethics and values; experience in corporate management, such as serving as an officer or former officer of a publicly-held company; experience in the Company's industry; experience as a board member of another publicly-held company; diversity of expertise and experience in substantive matters pertaining to the Company's business relative to other directors of the Company; practical and mature business judgment; and composition of the Board (including its size and structure). The Governance and Nominating Committee does not have a policy with regard to the consideration of any director candidates recommended by stockholders but will consider any such recommendations in the same manner as it evaluates other potential director nominees, as set forth above.

The Governance and Nominating Committee may, in its sole discretion and at the Company's cost, retain or obtain the advice of a search firm, legal counsel or other adviser. The Governance and Nominating Committee is directly responsible for the appointment, compensation and oversight of the work of any search firm, legal counsel and other adviser retained by the committee.

During 2024, our Governance and Nominating Committee met two times.

**Code of Ethics**

We have adopted a Code of Business Conduct and Ethics (the "Code of Ethics") that applies to all of the Company's employees, including the Company's Chief Executive Officer and Chief Financial Officer. Although not required, the Code of Ethics also applies to the Company's directors. A copy the Code of Ethics has been filed as Exhibit 14.1 to our Annual Report. The Code of Ethics provides written standards that we believe are reasonably designed to deter wrongdoing and promote honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships, full, fair, accurate, timely and understandable disclosure and compliance with laws, rules and regulations, the prompt reporting of illegal or unethical behavior, and accountability for adherence to the Code of Ethics.

**Policy Against Hedging and Pledging**

We have not adopted a policy that prohibits our directors, officers and employees from engaging in short-term or speculative transactions including selling our stock "short" and transacting in publicly-traded options, warrants, puts and calls or similar instruments on our securities that are designed to hedge or offset any decrease in the market value of our Common Stock. We have not adopted a policy that prohibits directors, officers and employees from holding our stock in a margin account or pledging our stock as collateral for a loan.

**EXECUTIVE AND DIRECTOR COMPENSATION**

The Company is presenting information about executive compensation in accordance with the Securities and Exchange Commission's rule and regulations relating to "smaller reporting companies" and "emerging growth companies."

**Summary Compensation Table**

The table below sets forth the compensation paid by our Company during the two years ended December 31, 2024 and 2023 to our Chief Executive Officer and the next two highest paid executive officers of the Company (our "named executive officers").

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name and Principal Position** | **Year** | **Salary <br> ($)** | **Bonus <br> ($)** | **Option <br> Awards <br> ($)** | **Non-Equity <br> Incentive Plan <br> Compensation <br> ($)** | **All Other <br> Compensation <br> ($)<sup>(1)</sup>** | **Total** |
| Kimball Carr | 2024 | 250000 | – |  | – | 16486 | 266486 |
| &nbsp;&nbsp;&nbsp;President and Chief Executive Officer | 2023 | 233630 | – |  | – | 17061 | 250691 |
| Richard Frank<sup>(2)</sup> | 2024 | 210000 | – |  | – | 12274 | 222274 |
| &nbsp;&nbsp;&nbsp;Chief Financial Officer | 2023 | 191781 | – |  | – | 10103 | 201884 |
| Alexandra Quarti, DVM | 2024 | 198240 | – |  | – | 11766 | 210006 |
| &nbsp;&nbsp;&nbsp;Vice President of Medical Operations | 2023 | 194272 | – |  | – | 10078 | 204350 |

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(1) "All Other Compensation" consists of Company
contributions to the Company's 401(k) plan and health benefit premiums. For 2024, these contributions were as follows:

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| | | |
|:---|:---|:---|
| **Name** | **401(k) Matching <br> Contributions <br> ($)** | **Health Benefit <br> Premiums <br> ($)** |
| Kimball Carr | 7500 | 8986 |
| Richard Frank | 2112 | 10162 |
| Alexandra Quarti | 2047 | 9718 |

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(2) Mr. Frank joined the Company in January 2023.

**Outstanding Equity Awards at December 31, 2024**

Our named executive officers had no outstanding equity awards at December 31, 2024.

**Executive Officer Agreements**

*Kimball Carr Employment*

 

The Company entered into an employment agreement with Kimball Carr, the Company's President and Chief Executive Officer, on July 8, 2021 (the "Employment Agreement"). On July 7, 2024, Mr. Carr's Employment Agreement was extended to February 1, 2025. The Company and Mr. Carr entered into a new employment agreement effective February 10, 2025. The discussion that follows relates to the Employment Agreement as in effect in 2024.

Pursuant to the Employment Agreement, Mr. Carr's duties consist of devoting as much time as is necessary to perform the duties and services required under the Employment Agreement and as may be designated by the Board, and devoting his best efforts to the business and affairs of Inspire and promoting the interests of Inspire. Mr. Carr is barred from directly or indirectly, engaging in any other business that could reasonably be expected to detract from his ability to apply his best efforts in the performance of his duties to Inspire.

*Base salary*

 

Under the Employment Agreement, for 2024, Mr. Carr's base salary was tied to annual revenue targets, as follows:

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| | |
|:---|:---|
| **Annual Revenue** | **Base Salary** |
| Up to $7,500,000 | $175000 |
| $7500000 | $225000 |
| $15000000 | $250000 |
| $20000000 | $300000 |
| $25000000 | To be negotiated by the parties |

---

*Bonuses*

 

For 2024, Mr. Carr was eligible for annual bonuses under the Employment Agreement tied to annual revenue and profit targets, as follows:

<u>Annual Revenue Bonus</u>

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| | |
|:---|:---|
| **Actual Revenue Compared to Revenue Target** | **Revenue Bonus** |
| 110% or greater | 125% of Revenue Bonus Target |
| 100 – 109% | 100% of Revenue Bonus Target |
| 95 – 99% | 95% of Revenue Bonus Target |
| 90 – 94% | 90% of Revenue Bonus Target |
| Below 90% | No Revenue Bonus |

---

The "Revenue Bonus Target" was 15% of Mr. Carr's base salary for 2024.

<u>Profit Bonus</u>

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| | |
|:---|:---|
| **Actual Profit Compared to Profit Target** | **Profit Bonus** |
| 110% or greater | 125% of Profit Bonus Target |
| 100 – 109% | 100% of Profit Bonus Target |
| 95 – 99% | 95% of Profit Bonus Target |
| 90 – 94% | 90% of Profit Bonus Target |
| Below 90% | No Profit Bonus |

---

The "Profit Bonus Target" was 15% of Mr. Carr's base salary for 2024.

<u>Stock Bonus</u>

For 2024, the Board had discretion to award Mr. Carr an additional bonus in the form of fully vested shares of Class A or Class B common stock, taking into account the Company's performance for the calendar year based on the revenue and profit targets, with the value of such shares equal to between 10% and 14% of Mr. Carr's base salary for such calendar year.

No bonuses were paid to Mr. Carr in 2024.

*Benefits*

 

Mr. Carr is entitled to participate in the employee benefit plans offered to the Company's employees on the same terms and conditions as other employees.

*Covenants*

 

The Employment Agreement contains certain non-disclosure and confidentiality provisions applicable to Mr. Carr for the benefit of the Company. Mr. Carr has also agreed, during the term of his employment and for a two-year period following the termination of his employment not to solicit for employment any employee or any person who was employed by the Company within the prior six months. Mr. Carr is also barred from soliciting any client or certain former clients for a period of two years following the termination of his employment with the Company.

*Termination*

 

The Company may terminate Mr. Carr's employment immediately for cause, which includes:

● his death;

● his mental or physical incapacity that prevents him, with or without reasonable accommodation, from performing his essential duties for a period of 60 consecutive days or longer;

● disloyalty or dishonesty towards the Company;

● gross or intentional neglect of in the performance of his duties and services or material fail to perform his duties and services;

● his violation of any law, rule, or regulation (other than minor traffic violations) related to his duties;

● his material breach of any provision of the Employment Agreement or any written Inspire policy, if such breach is not cured within 10 days after written notice; and

● any other act or omission which harms or may reasonably be expected to harm the reputation or business interests of the Company.

Mr. Carr may terminate the Employment Agreement immediately for good reason, which is defined to include:

● a material breach of the Employment Agreement by the Company, if such breach is not cured within 10 days after written notice;

● a material reduction in his duties or responsibilities without his consent, if such breach is not cured within 10 days after written notice;

● a relocation of his office to a location more than 30 miles from Virginia Beach, Virginia without his consent, if such relocation is not reversed within 10 days after written notice; and

● a change in control of the Company, provided that he gives notice of termination based on such change in control within six months.

*Severance Pay*

 

In the event the Employment Agreement is terminated by Mr. Carr for good reason but not in connection with a change in control of the Company, the Company will provide Mr. Carr with severance pay equal to one year of Mr. Carr's then-current base salary, contingent on Mr. Carr executing a release of claims. In the event the Employment Agreement is terminated by Mr. Carr for good reason within six months after a change in control of the Company, the Company will provide Mr. Carr with severance pay equal to (a) one year of Mr. Carr's then-current base salary and (b) as determined in the Board's sole discretion, a pro rata stock bonus taking into account the Company's performance for the current calendar year, contingent on Mr. Carr executing a release of claims.

*Richard Frank Employment*

 

The Company entered into an employment agreement with Richard Frank, the Company's Chief Financial Officer, on January 1, 2024 (the "Frank Employment Agreement"). The Company and Mr. Frank entered into a new employment agreement effective March 1, 2025. The discussion that follows relates to the Frank Employment Agreement as in effect in 2024.

Pursuant to the Frank Employment Agreement, Mr. Frank's duties consist of devoting as much time as is necessary to perform the duties and services required under the Frank Employment Agreement and as may be designated by the Chief Executive Officer, and devoting his best efforts to the business and affairs of Inspire and promoting the interests of Inspire. Mr. Frank is barred from directly or indirectly, engaging in any other business that could reasonably be expected to detract from his ability to apply his best efforts in the performance of his duties to Inspire.

*Base salary*

 

Under the Frank Employment Agreement, for 2024, Mr. Frank's base salary was $210,000.

*Bonuses*

 

For 2024, Mr. Frank was eligible for annual bonuses under the Frank Employment Agreement tied to annual revenue and profit targets, as follows:

<u>Annual Revenue Bonus</u>

---

| | |
|:---|:---|
| **Actual Revenue Compared to Revenue Target** | **Revenue Bonus** |
| 110% or greater | 125% of Revenue Bonus Target |
| 100 – 109% | 100% of Revenue Bonus Target |
| 95 – 99% | 95% of Revenue Bonus Target |
| 90 – 94% | 90% of Revenue Bonus Target |
| Below 90% | No Revenue Bonus |

---

The "Revenue Bonus Target" was 15% of Mr. Frank's base salary for 2024.

<u>Profit Bonus</u>

---

| | |
|:---|:---|
| **Actual Profit Compared to Profit Target** | **Profit Bonus** |
| 110% or greater | 125% of Profit Bonus Target |
| 100 – 109% | 100% of Profit Bonus Target |
| 95 – 99% | 95% of Profit Bonus Target |
| 90 – 94% | 90% of Profit Bonus Target |
| Below 90% | No Profit Bonus |

---

The "Profit Bonus Target" was 15% of Mr. Frank's base salary for 2024.

<u>Stock Bonus</u>

For 2024, the Board had discretion to award Mr. Frank an additional bonus in the form of fully vested shares of Class A or Class B common stock, taking into account the Company's performance for the calendar year based on the revenue and profit targets, with the value of such shares equal to between 10% and 14% of Mr. Frank's base salary for such calendar year.

No bonuses were paid to Mr. Frank in 2024.

*Benefits*

 

Mr. Frank is entitled to participate in the employee benefit plans offered to the Company's employees on the same terms and conditions as other employees.

*Covenants*

 

The Frank Employment Agreement contains certain non-disclosure and confidentiality provisions applicable to Mr. Frank for the benefit of the Company. Mr. Frank has also agreed, during the term of his employment and for a two-year period following the termination of his employment not to solicit for employment any employee or any person who was employed by the Company within the prior six months. Mr. Frank is also barred from soliciting any client or certain former clients for a period of two years following the termination of his employment with the Company.

*Termination*

 

The Company may terminate Mr. Frank's employment immediately for cause, which includes:

● his death;

● his mental or physical incapacity that prevents him, with or without reasonable accommodation, from performing his essential duties for a period of 60 consecutive days or longer;

● disloyalty or dishonesty towards the Company;

● gross or intentional neglect of in the performance of his duties and services or material fail to perform his duties and services;

● his violation of any law, rule, or regulation (other than minor traffic violations) related to his duties;

● his material breach of any provision of the Frank Employment Agreement or any written Inspire policy, if such breach is not cured within 10 days after written notice; and

● any other act or omission which harms or may reasonably be expected to harm the reputation or business interests of the Company.

Mr. Frank may terminate the Frank Employment Agreement immediately for good reason, which is defined to include:

● a material breach of the Frank Employment Agreement by the Company, if such breach is not cured within 10 days after written notice;

● a material reduction in his duties or responsibilities without his consent, if such breach is not cured within 10 days after written notice; and

● a change in control of the Company, provided that he gives notice of termination based on such change in control within six months.

*Severance Pay*

In the event the Frank Employment Agreement is terminated by Mr. Frank for good reason but not in connection with a change in control of the Company, the Company will provide Mr. Frank with severance pay equal to one year of Mr. Frank's then-current base salary, contingent on Mr. Frank executing a release of claims. In the event the Frank Employment Agreement is terminated by Mr. Frank for good reason within six months after a change in control of the Company, the Company will provide Mr. Frank with severance pay equal to (a) one year of Mr. Frank's then-current base salary and (b) as determined in the Board's sole discretion, a pro rata stock bonus taking into account the Company's performance for the current calendar year, contingent on Mr. Frank executing a release of claims.

**Executive Incentive Compensation Recovery Policy**

We have adopted an executive incentive compensation recovery policy (the "Executive Incentive Compensation Recovery Policy") pursuant to Section 10D of the Exchange Act, Rule 10D-1 promulgated under the Exchange Act ("Rule 10D-1"), and Listing Rule 5608 adopted by Nasdaq (the "Listing Standards"). The purpose of the Executive Incentive Compensation Recovery Policy is to provide for the recovery of certain incentive-based compensation in the event of an accounting restatement. In the event of an accounting restatement, it is the Company's policy to recover reasonably promptly the amount of any erroneously awarded compensation received during the recovery period. An accounting restatement involves a restatement of the Company's financial statements due to material noncompliance with any financial reporting requirement under the federal securities laws, including any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period.

The amount of "erroneously awarded compensation" generally means the amount of incentive-based compensation (compensation that is granted, earned, or vested based wholly or in part upon the attainment of a financial reporting measure) received by a covered executive that exceeds the amount of incentive-based compensation that otherwise would have been received had it been determined based on the restated financial statements. The Company need not recover any "erroneously awarded compensation" if and to the extent that the Compensation Committee or a majority of the independent members of the Board determines that such recovery is impracticable and not required under Rule 10D-1 and the Listing Standards, including if the Compensation Committee or a majority of the independent members of the Board determines that: (i) the direct expense paid to a third party to assist in enforcing the policy would exceed the amount to be recovered after making a reasonable attempt to recover, or (ii) recovery would likely cause an otherwise tax-qualified broad-based retirement plan to fail the requirements of Section 401(a)(13) or Section 411(a) of the Internal Revenue Code of 1986, as amended, and regulations thereunder.

The policy is administered by our Compensation Committee, except that the Board may decide to act as the administrator in lieu of the Compensation Committee or designate another committee of the Board (including a special committee) to act as the administrator other than for the determination that recovery of "erroneously awarded compensation" is impracticable and not required.

**2022 Equity Incentive Plan**

Effective October 18, 2022, shareholders of Company approved the Company's 2022 Equity Incentive Plan (the "Plan"). The Plan provides for the award of stock options (incentive and non-qualified), stock awards and stock appreciation rights to officers, directors, employees and consultants who provide services to the Company.

Under the plan, the capital stock available for issuance under the Plan are the shares of the Company's authorized but unissued common stock. The number of shares issued may not exceed, at any given time, ten percent (10%) of the total of: (a) the issued and outstanding shares of the Company's common stock, and (b) all shares common stock issuable upon conversion or exercise of any outstanding securities of the Company which are convertible or exercisable into shares of common stock.

The Board may terminate the Plan at any time. Unless sooner terminated, the Plan will terminate ten years after the effective date of the Plan. The number of shares of common stock covered by each outstanding stock right, and the number of shares of common stock which have been authorized for issuance under the Plan as well as the price per share of common stock (or cash, as applicable) covered by each such outstanding option or stock appreciation rights, shall be proportionately adjusted for any increases or decrease in the number of issued shares of common stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification, or any other increase or decrease in the number of issued shares of common stock effected without receipt of consideration by the Company.

The foregoing description of the 2022 Equity Incentive Plan is qualified in its entirety by the full text of the 2022 Equity Incentive Plan, which is attached hereto as Exhibit 10.5 and is herein incorporated by reference.

**Director Compensation**

Our non-employee directors receive the following compensation:

● an annual retainer of $36,000, payable monthly; and

● an annual committee fee of $5,000 for those non-employee directors who serve on one or more committees, payable annually.

In addition, in September 2024, non-employee directors who were then serving on the Board received options to acquire shares of Class A common stock.

The following table summarizes the compensation paid to our non-employee directors during the fiscal year ended December 31, 2024:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name<sup>(1)</sup>** | **Fees <br> Earned <br> or Paid in <br> Cash <br> ($)** | **Stock <br> Awards <br> ($)** | **Option <br> Awards <br> ($)<sup>(4)(5)</sup>** | **Non-Equity <br> Plan Incentive <br> Compensation <br> ($)** | **Non-Qualified <br> Deferred <br> Compensation <br> Earnings <br> ($)** | **All Other <br> Compensation <br> ($)** | **Total** |
| Larry Alexander | 41000 | – | 3618 | – |  | – | 44618 |
| Phillip Balatsos<sup>(2)</sup> | 9000 | – |  | – |  | – | 9000 |
| Charles Stith Keiser | 36000 | – | 2382 | – |  | – | 38382 |
| Peter Lau<sup>(3)</sup> | 30750 | – | 3177 | – |  | – | 44177 |
| Anne Murphy | 41000 | – | 3618 | – |  | – | 44618 |
| John Suprock<sup>(3)</sup> | 27000 | – | 3618 | – |  | – | 44618 |
| Erinn Thomas-Mackey, DVM | 41000 | – | 3618 | – |  | – | 34368 |
| Timothy Watters | 41000 | – | 3618 | – |  | – | 30618 |

---

<sup>(1)</sup> Kimball Carr, our Chair of the Board, President and Chief Executive Officer, is not included in this table. As an employee of the Company, Mr. Carr receives no compensation for service as a director. The compensation received by Mr. Carr is shown in the Summary Compensation Table in "Executive Compensation."

<sup>(2)</sup> Mr. Balatsos joined the Company's Board in October 2024.

<sup>(3)</sup> Messrs. Lau and Suprock ceased to serve on the Company's Board as of October 9, 2024. Their stock option awards were forfeited and canceled at that time.

<sup>(4)</sup> Amount represents the aggregate grant date fair value, computed in accordance with Accounting Standards Codification Topic 718, *Compensation — Stock Compensation*, of options to acquire shares of Class A common stock granted on September 26, 2024 at an exercise price of $17 per share, which was the closing price per share of the Class A common stock on the Nasdaq Stock Market on the grant date (as adjusted for a 1-for-25 reverse stock split that was effected in January 2025). The options were fully vested on the grant date. Information about the assumptions used to value these awards can be found in Note 11 to the consolidated financial statements in the Annual Report.

<sup>(5)</sup> The following table provides information regarding the aggregate outstanding option awards held by each non-employee director as of December 31, 2024 (as adjusted for a 1-for-25 reverse stock split that was effected in January 2025):

---

| | | | |
|:---|:---|:---|:---|
| | **Stock Options** | **Stock Options** | **Stock Options** |
| <br>**Name** | **Outstanding <br> (#)** | **Outstanding <br> (#)** | **Unvested <br> (#)** |
| Larry Alexander |  | 1447 |  |
| Phillip Balatsos |  |  |  |
| Charles Stith Keiser |  | 953 |  |
| Peter Lau |  |  |  |
| Anne Murphy |  | 1447 |  |
| John Suprock |  |  |  |
| Erinn Thomas-Mackey, DVM |  | 1447 |  |
| Timothy Watters |  | 1447 |  |

---

**SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT**

The following table set forth information regarding beneficial ownership of our Class A and Class B common stock as of November 21, 2025 by (1) each of our named executive officers, (2) each of our directors, (3) all of our directors and executive officers as a group and (4) each person, or group of affiliated persons, known by us to beneficially own more than five percent of our shares of Class A or Class B common stock.

The information relating to beneficial ownership of our voting securities by our principal stockholders and management is based upon information furnished by each person using "beneficial ownership" concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person directly or indirectly has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to dispose or direct the disposition of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary interest. Unless otherwise indicated, it is our understanding and belief that the stockholders listed possess sole voting and investment power with respect to the shares shown.

The percentages below are calculated based on 38,567,465 shares of Class A common stock outstanding and 3,020,750 shares of Class B common stock outstanding.

Except as otherwise noted below, each stockholder's address is c/o Inspire Veterinary Partners, Inc. 780 Lynnhaven Parkway, Suite 400, Virginia Beach, VA 23452.

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Name of Beneficial Owner** | **Class of <br> Voting Stock <br> Beneficially <br> Owned** | **Number of <br> Shares <br> Beneficially <br> Owned** | **Percentage <br> of Shares <br> Beneficially <br> Owned** | **Total Combined <br> Percentage <br> of Shares <br> Beneficially <br> Owned** |
| **NAMED EXECUTIVE OFFICERS** |  | | | |
| Kimball Carr | Class A common | 92624<sup>(1)</sup> | \* | 1.0% |
|  | Class B common | 333250 | 11.0% |  |
| Richard Frank | Class A common | 58480<sup>(2)</sup> | \* | \* |
|  | Class B common |  |  |  |
| Alexandra Quarti | Class A common |  |  |  |
|  | Class B common |  |  |  |
| **DIRECTORS** |  |  |  |  |
| Larry Alexander | Class A common | 1448<sup>(3)</sup> | \* | \* |
|  | Class B common |  |  |  |
| Phillip Balatsos | Class A common |  |  |  |
|  | Class B common |  |  |  |
| Charles Stith Keiser | Class A common | 963<sup>(4)</sup> | \* | 5.2% |
|  | Class B common | 2150000<sup>(5)</sup> | 71.2% |  |
| Anne Murphy | Class A common | 1447<sup>(6)</sup> | \* | \* |
|  | Class B common |  |  |  |
| Erinn Thomas-Mackey | Class A common | 1449<sup>(3)</sup> | \* | \* |
|  | Class B common |  |  |  |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Name of Beneficial Owner** | **Class of <br> Voting Stock <br> Beneficially <br> Owned** | **Number of <br> Shares <br> Beneficially <br> Owned** | **Percentage <br> of Shares <br> Beneficially <br> Owned** | **Total Combined <br> Percentage <br> of Shares <br> Beneficially <br> Owned** |
| Timothy Watters | Class A common | 1447<sup>(6)</sup> | \* | \* |
|  | Class B common |  |  |  |
| **All Current Directors and Executive Officers as a Group (11 persons)** | Class A common | 192105 | \* | 6.4% |
|  | Class B common | 2483250 | 82.2% |  |
| **GREATER THAN 5% OWNERS** |  |  |  |  |
| Wilderness Trace Veterinary Partners, LLC | Class A common |  |  | 5.2% |
|  | Class B common | 2150000<sup>(7)</sup> | 71.2% |  |
| Peter Lau | Class A common |  |  | 1.3% |
|  | Class B common | 537500 | 17.8% |  |

---

\* Represents less than 1%.

(1) Includes 20 shares of Class A common stock that may
be acquired at a price of $6,000 per share upon exercise of a fully vested warrant. The warrant is exercisable until January 1,
2028. Also includes 92,593 shares of Class A common stock that may be acquired at a price of $1.62 per share upon exercise of fully
vested options.

(2) Represents 58,480 shares of Class A common stock that
may be acquired at a price of $1.71 per share upon exercise of fully vested options.

(3) Includes 1,447 shares of Class A common stock that may
be acquired at a price of $17 per share upon exercise of fully vested options.

(4) Includes 953 shares of Class A common stock that may
be acquired at a price of $17 per share upon exercise of fully vested options.

(5) Beneficially owned by Wilderness Trace Veterinary Partners,
LLC, which is controlled by Charles Stith Keiser.

(6) Represents 1,447 shares of Class A common stock that
may be acquired at a price of $17 per share upon exercise of fully vested options.

(7) Wilderness Trace Veterinary Partners, LLC is 100% owned and
controlled by Charles Stith Keiser.

**CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS**

Since January 1, 2023, there has not been, nor is there currently proposed, any transaction or series of similar transactions to which we were or are a participant and in which the amount involved exceeded or exceeds $120,000 and in which any of our directors, executive officers, holders of more than five percent of any class of our voting securities, or any member of the immediate family of any of the foregoing persons, had or will have a direct or indirect material interest, other than compensation arrangements with directors and executive officers, which are described elsewhere in this proxy statement, and as set forth below.

<u>Keiser Loans</u>

On August 10, 2022, Charles Stith Keiser, our director, former Chief Operating Officer and largest shareholder through his entity Wilderness Trace Veterinary Partners, LLC, and his father, advanced $150,000 each for a total of $300,000 to the Company for working capital needs. The advances were pursuant to an oral agreement, were interest-free, required the Company to pay a $5,000 fee to each lender as consideration for the advances and were payable upon demand by either lender. All amounts payable in satisfaction of loans to the Company made by Mr. Keiser or Dr. Keiser were repaid prior to the consummation of the Company's initial public offering on August 31, 2023.

<u>Consulting Agreements</u>

The Company received acquisition, business and financial advisory services from Blue Heron Consulting ("BHC") pursuant to a consulting agreement (the "BHC Consulting Agreement") that it entered into with BHC in June 2021. Charles Stith Keiser, our director is the Chief Operating Officer of BHC and Mr. Keiser's father is the Chief Visionary Officer of BHC. The BHC Consulting Agreement was terminated without cause by the Company in the fourth quarter of 2023. The Company paid approximately $1.1 million to BHC during the term of the agreement. The Company continues to use BHC for ad hoc services that are billed based on services provided. The Company paid BHC $83,168 during the year ended December 31, 2024.

The Company entered into a consulting agreement with Star Circle Advisory Group, LLC ("Star Circle") on August 2, 2022, to serve as financial consultant, on a non-exclusive basis, to assist with arranging bridge financing and the initial public offering of the Company. Star Circle is partially owned and controlled by Kimball Carr, our Chief Executive Officer. Star Circle was entitled to a monthly fee of $33,000, payable monthly. Each party was responsible for its own ordinary office and personnel expenses; however, Star Circle was entitled, with prior written consent from the Company, for reimbursement for required extraordinary expenses including air travel, lodging, and Company filing fees. Prior to the formal agreement between the Company and Star Circle, Star Circle provided the same services under a verbal agreement that was memorialized by the consulting agreement. During the fourth quarter of 2023 management terminated the service agreement with Star Circle Advisory. The Company incurred $284,900 in expenses for the year ended December 31, 2023.

<u>Chief Executive Officer's Warrant</u>

On January 1, 2023, the Board of Directors issued a warrant to purchase up to 20 shares of our Class A common stock at a purchase price per share equal to $6,000 to Kimball Carr, our CEO, in consideration for his personal guaranty of the Company loans. The warrant expires on January 1, 2028. The warrants were measured at fair value using the Black Scholes Method. The warrants were valued at $2,701 at the time of issuance.

<u>Sale of Veterinary Clinic</u>

On September 20, 2024, the Company sold Kauai Veterinary Clinic to Kauai RE Holdings LLC in consideration for Kauai RE Holdings LLC assuming $2 million in debt. The father of our board member, Charles Stith Keiser, is a member of Kauai RE Holdings LLC.

**Conflicts of Interest**

Members of our management are associated with other firms involved in a range of business activities. Consequently, there are potential inherent conflicts of interest in their acting as officers and directors of the Company. Although the officers and directors are engaged in other business activities, we anticipate they will devote an important amount of time to our affairs.

Our officers and directors are now and may in the future become shareholders, officers or directors of other companies, which may be formed for the purpose of engaging in business activities similar to ours. Accordingly, additional direct conflicts of interest may arise in the future with respect to such individuals acting on behalf of us or other entities. Moreover, additional conflicts of interest may arise with respect to opportunities which come to the attention of such individuals in the performance of their duties or otherwise. Currently, we do not have a right of first refusal pertaining to opportunities that come to their attention and may relate to our business operations.

Our officers and directors are, so long as they are our officers or directors, subject to the restriction that all opportunities contemplated by our plan of operation which come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available to us and the companies that they are affiliated with on an equal basis. A breach of this requirement will be a breach of the fiduciary duties of the officer or director. If we or the companies with which the officers and directors are affiliated both desire to take advantage of an opportunity, then said officers and directors would abstain from negotiating and voting upon the opportunity. However, all directors may still individually take advantage of opportunities if we should decline to do so.

**Review, Approval or Ratification of Transactions with Related Persons**

Our Code of Ethics states that directors and executive officers must avoid conflicts of interest with the Company and requires any situation that involves, or may reasonably be expected to involve, a conflict of interest with the Company to be disclosed immediately to the Chair of the Board. The Audit Committee will review issues involving potential conflicts of interest, and review and approve all related party transactions, including those required to be disclosed as a "related party" transaction under applicable federal securities laws. The Audit Committee has not adopted any specific procedures for conducting reviews of potential conflicts of interest and considers each transaction in light of the specific facts and circumstances presented. However, to the extent a potential related party transaction is presented to the Audit Committee, the Audit Committee becomes fully informed regarding the potential transaction and the interests of the related party and has the opportunity to deliberate outside of the presence of the related party. The Audit Committee only approves a related party transaction that is in the best interests of, and fair to, the Company, and seeks to ensure that any completed related party transaction is on terms no less favorable to the Company than could be obtained in a transaction with an unaffiliated third party.

**DESCRIPTION OF CAPITAL STOCK**

**General**

Our authorized capital stock consists of one hundred seventy million (170,000,000) shares of stock, consisting of three (3) classes of stock designated, respectively, as "Class A common stock," "Class B common stock" and "Preferred Stock," each such share having a par value of $0.0001 per share. The total number of authorized shares are: one hundred million (100,000,000) shares of Class A common stock; twenty million (20,000,000) shares of Class B common stock; and fifty million (50,000,000) shares of Preferred Stock.

**Class A Common Stock**

Holders of our Class A common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. No holder of shares of Class A common stock has the right to cumulate votes.

Holders of our Class A common stock are entitled to receive dividends when and if declared by our board of directors out of funds legally available therefor, subject to any statutory or contractual restrictions on the payment of dividends and to any restrictions on the payment of dividends imposed by the terms of any outstanding shares of Preferred Stock.

Upon the liquidation, dissolution or winding up of the Company, after payment in full of all amounts required to be paid to creditors and to the holders of our Preferred Stock having liquidation preferences, if any, the holders of our Class A common stock are entitled to share, along with the holders of our Class A common stock and holders of Preferred Stock which are not entitled to any liquidation preference, ratably in all assets remaining.

Holders of Class A common stock have no preemptive or redemption rights and no right to convert their common stock into any other securities. All outstanding shares of Class B common stock are fully paid and non-assessable.

**Class B Common Stock**

Holders of our Class B common stock are entitled to twenty-five (25) votes for each share held of record on all matters submitted to a vote of stockholders. No holder of shares of Class B common stock has the right to cumulate votes.

Subject to the rights of holders of Preferred Stock having preference as to dividends, the holders of our Class A common stock are entitled to receive dividends when, as and if declared by our board of directors out of legally available funds.

Upon our liquidation, dissolution or winding up of the affairs of the Company, subject to any preference right of holder of the Preferred Stock of the Company, the holders of our Class B common stock shall share equally and ratably, along with the holders of our Class A common stock and holders of Preferred Stock which are not entitled to any liquidation preference, in the Company's assets. The merger, conversion, exchange or consolidation of the Company is not deemed a liquidation, dissolution or winding up of the affairs of the Company.

Our Class B common stock may be convertible at the option of the holders, without the payment of additional consideration, at any time, into shares of Class A common stock at a conversion rate of one share of Class A common stock for each share of Class B common stock. The conversion rate of the Class B common stock will be adjusted proportionately if the Company, at any time or from time to time, (a) pays a dividend or makes a distribution for no consideration to holders of our Class A common stock, (b) subdivides (by stock split, recapitalization or otherwise) our outstanding Class A common stock into a greater number of shares, or (c) combines its outstanding Class A common stock into a smaller number of shares.

The holders of Class B common stock do not have any redemption or preemptive rights.

**Preferred Stock**

Pursuant to our articles of incorporation, our board of directors has the authority, without further action by the stockholders, to issue up to fifty million (50,000,000) shares of Preferred Stock, in one or more series. Our board of directors has the authority, without further action by the shareholders, to issue shares of Preferred Stock in one or more series and to fix the rights, preferences, privileges and restrictions granted to or imposed upon the preferred stock. Preferred Stock may be designated and issued without authorization of shareholders unless such authorization is required by applicable law, the rules of the principal market or other securities exchange on which our stock is then listed or admitted to trading.

Our board of directors may authorize the issuance of Preferred Stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of our Class A common stock or Class B common stock. The issuance of Preferred Stock, while providing flexibility in connection with possible acquisitions and other corporate purposes could, under some circumstances, have the effect of delaying, deferring or preventing a change in control of the Company.

The description of Preferred Stock in this prospectus and the description of the terms of a particular series of preferred stock in any applicable prospectus supplement are not complete. You should refer to any applicable certificate of designation for complete information.

All shares of Preferred Stock offered hereby will, when issued, be fully paid and nonassessable, including shares of Preferred Stock issued upon the exercise of preferred stock warrants or subscription rights, if any.

**Series A preferred stock**

The Company has designated 20,000 shares of the Company's authorized and unissued preferred stock as Series A preferred stock (the "Series A preferred stock"). As of the date of this prospectus, there are no shares of Series A preferred stock issued and outstanding.

**Series B preferred stock**

The Company has designated 10,000 shares of the Company's authorized and unissued preferred stock as Series B Preferred Stock (the "Series B preferred stock") and established the rights, preferences and privileges of the Series B preferred stock pursuant to a Certificate of Designations of Rights and Preferences of the Series B Preferred Stock (the "Certificate of Designations").

*General*. Each share of Series B preferred stock has a stated value of $1,000 per share and, when issued, the Series B preferred stock will be fully paid and non-assessable.

*Ranking*. The Series B preferred stock, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to all capital stock of the Company unless the Required Holders (as defined in the Series B Certificate of Designation) consent to the creation of other capital stock of the Company that is senior or equal in rank to the Series B preferred stock.

*Dividends*. The holders of Series B preferred stock will be entitled to dividends, on an as-if converted basis, equal to and in the same form as dividends actually paid on shares of the Company's Common Stock, when and if actually paid.

*Purchase Rights*. If at any time the Company grants, issues or sells any options, convertible securities, or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of any class of Common Stock (the "Purchase Rights"), then each holder of Series B preferred stock will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such holder could have acquired if such holder had held the number of shares of Common Stock acquirable upon complete conversion of all the Series B preferred stock held by such holder immediately prior to the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights at the Alternate Conversion Price (as defined below); subject to certain limitations on beneficial ownership.

*Conversion Rights*

*Conversion at Option of Holder*. Each holder of Series B preferred stock may convert all, or any part, of the outstanding Series B preferred stock, at any time at such holder's option, into shares of the Common Stock (which converted shares of Common Stock are referred to as "Conversion Shares" herein) at the fixed "Conversion Price" of $1.00 which is subject to proportional adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions.

*Voluntary Adjustment Right*. Subject to the rules and regulations of the Nasdaq, the Company has the right, at any time, with the written consent of the Required Holders, to lower the fixed conversion price to any amount and for any period of time deemed appropriate by the board of directors of the Company.

*Alternate Conversion Upon a Triggering Event*. Following the occurrence and during the continuance of a Triggering Event (as defined below), each holder may alternatively elect to convert the Series B preferred stock at the "Alternate Conversion Price" equal to the lesser of: (i) the applicable conversion price, and the greater of (A) the floor price of $0.1879 (the "Floor Price"); and (B) 80% of the lowest volume weighted average price of the Common Stock during the five consecutive trading days immediately prior to such conversion. On December 1, 2025, the Company entered into an agreement with the Required Holders under the Certificate of Designation, to lower the Floor Price to $0.05.

The Series B Certificate of Designation contains standard and customary triggering events (each, a "Triggering Event"), including but not limited to: (i) the suspension from trading or the failure to list the Common Stock within certain time periods; (ii) failure to declare or pay any dividend when due; (iii) the failure to timely file or make effective a registration statement on Form S-1 or Form S-3 pursuant to the Registration Rights Agreement (as defined below), (iv) the Company's failure to cure a conversion failure or notice of the Company's intention not to comply with a request for conversion of any Series B preferred stock, and (iv) bankruptcy or insolvency of the Company.

*Other Adjustments*. In connection with the Private Placement, the Company has agreed to seek stockholder approval at a special meeting of stockholders, of the issuance of conversion shares at a conversion price below the conversion price (the date of such approval, the "Stockholder Approval Date").

If 30 days and 60 days following the occurrence of the later of (x) the Stockholder Approval Date and (y) the earlier of (a) the effective date of the registration statement to be filed pursuant to the Registration Rights Agreement and (b) the date that the Series B preferred stock is eligible to be resold without restriction under Rule 144 of the Securities Act of 1933, as amended (the "Securities Act"), the Conversion Price then in effect is greater than the greater of the Floor Price and the Market Price (as defined in the Certificate of Designations) then in effect (each, an "Adjustment Price"), the conversion price shall automatically lower to such Adjustment Price.

*Change of Control Exchange*. Upon a change of control of the Company, each holder may require the Company to exchange the holder's shares of Series B preferred stock for consideration equal to the Change of Control Election Price (as defined in the Series B Certificate of Designation), to be satisfied at the Company's election in either (x) cash or (y) rights convertible into such securities or other assets to which such holder would have been entitled with respect to such shares of Common Stock had such shares of Common Stock been held by such holder upon consummation of such corporate event.

*Company Optional Redemption*. At any time the Company shall have the right to redeem in cash all, but not less than all, the shares of Series B preferred stock then outstanding at a redemption price equal to 125% of the greater of (i) the Conversion Amount being redeemed as of the Company optional redemption date and (ii) the product of (1) the conversion rate with respect to the Conversion Amount being redeemed as of the Company optional redemption date multiplied by (2) the greatest closing sale price of the Common Stock on any Trading Day during the period commencing on the date immediately preceding such Company optional redemption notice date and ending on the Trading Day immediately prior to the date the Company makes the entire payment required to be made.

*Fundamental Transactions*. The Series B Certificate of Designation prohibits the Company from entering specified fundamental transactions (including, without limitation, mergers, business combinations and similar transactions) unless the Company (or the Company's successor) assumes in writing all of the Company's obligations under the Certificate of Designations and the other Transaction Documents (as defined in the Series B Certificate of Designation).

*Voting Rights*. The holders of the Series B preferred stock shall have no voting power and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock, except as provided in the Certificate of Designations (or as otherwise required by applicable law).

*Covenants*. The Series B Certificate of Designation contains a variety of obligations on the Company's part not to engage in specified activities. In particular, the Company will not, and will cause the Company's subsidiaries to not, redeem, repurchase or declare any dividend or distribution on any of the Company's capital stock (other than as required under the Series B Certificate of Designation) and will not incur any indebtedness other than ordinary course trade payables or, subject to certain exceptions, incur any liens. In addition, the Company will not issue any preferred stock or issue any other securities that would cause a breach or default under the Series B Certificate of Designation.

*Reservation Requirements*. So long as any Series B preferred stock remains outstanding, the Company shall at all times reserve at least 250% of the number of shares of Common Stock as shall from time to time be necessary to effect the conversion of all Series B preferred stock then outstanding.

**Modification of Shareholder Rights**

Pursuant to Nevada Revised Statutes Article 79.390, any amendment to the articles of association (other than a change in number of authorized shares of class or series) to affect or modify shareholders' rights requires (i) a resolution adopted by the board of directors setting forth the proposed amendment and submission of the proposed amendment to the stockholders for approval; (ii) affirmative vote of stockholders holding shares in the corporation representing at least a majority of the voting power, or such greater proportion of the voting power as may be required in the case of a vote by classes or series, approving the amendment; and (iii) a certificate signed by an authorized officer setting forth the amendment, the vote by which the amendment was adopted, and filing of the certificate with the Secretary of State of Nevada.

**Anti-Takeover Effects of Provisions of Our Amended and Restated Articles of Incorporation, Our Amended and Restated Bylaws and Nevada Law**

 

*Nevada Anti-Takeover Law*

The Nevada Revised Statutes ("NRS") contain several provisions which may make a hostile take-over or change of control of our Company more difficult to accomplish. They include the following:

Under Nevada law, any one or all of the directors of a corporation may be removed by the holders of not less than two-thirds of the voting power of a corporation's issued and outstanding stock. All vacancies on the board of directors of a Nevada corporation may be filled by a majority of the remaining directors, though less than a quorum, unless the articles of incorporation provide otherwise. In addition, unless otherwise provided in the articles of incorporation, the board may fill the vacancies for the entire remainder of the term of office of the resigning director or directors. Our Articles of Incorporation do not provide otherwise.

In addition, Nevada law provides that unless otherwise provided in a corporation's articles of incorporation or bylaws, shareholders do not have the right to call special meetings. Our articles of incorporation and our bylaws do not give shareholders this right. In accordance with Nevada law, we also require advance notice of any shareholder proposals.

Nevada law provides that, unless otherwise prohibited by any bylaws adopted by the shareholders, the board of directors may amend any bylaw, including any bylaw adopted by the shareholders. Pursuant to Nevada law, our articles of incorporation grant the authority to adopt, amend or repeal bylaws exclusively to our directors.

Nevada's "combinations with interested stockholders" statutes prohibit certain business "combinations" between certain Nevada corporations and any person deemed to be an "interested stockholder" for two years after the such person first becomes an "interested stockholder" unless (i) the corporation's board of directors approves the combination (or the transaction by which such person becomes an "interested stockholder") in advance, or (ii) the combination is approved by the board of directors and sixty percent of the corporation's voting power not beneficially owned by the interested stockholder, its affiliates and associates. Furthermore, in the absence of prior approval, certain restrictions may apply even after such two-year period. For purposes of these statutes, an "interested stockholder" is any person who is (x) the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the outstanding voting shares of the corporation, or (y) an affiliate or associate of the corporation and at any time within the two previous years was the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the then outstanding shares of the corporation. Subject to certain timing requirements set forth in the statutes, a corporation may elect not to be governed by these statutes. However, we have not included any such provision in our Articles of Incorporation or Bylaws, which means these provisions apply to us.

Nevada's "acquisition of controlling interest" statutes contain provisions governing the acquisition of a controlling interest in certain Nevada corporations. These "control share" laws provide generally that any person who acquires a "controlling interest" in certain Nevada corporations may be denied certain voting rights, unless a majority of the disinterested stockholders of the corporation elects to restore such voting rights. These statutes provide that a person acquires a "controlling interest" whenever a person acquires shares of a subject corporation that, but for the application of these provisions of the NRS, would enable that person to exercise (1) one-fifth or more, but less than one-third, (2) one-third or more, but less than a majority or (3) a majority or more, of all of the voting power of the corporation in the election of directors. Once an acquirer crosses one of these thresholds, shares which it acquired in the transaction taking it over the threshold and within the 90 days immediately preceding the date when the acquiring person acquired or offered to acquire a controlling interest become "control shares" to which the voting restrictions described above apply. Our Articles of Incorporation and Bylaws currently contain no provisions relating to these statutes, and unless our Articles of Incorporation or Bylaws in effect on the tenth day after the acquisition of a controlling interest were to provide otherwise, these laws would apply to us if we were to (i) have 200 or more stockholders of record (at least 100 of which have addresses in the State of Nevada appearing on our stock ledger) and (ii) do business in the State of Nevada directly or through an affiliated corporation. As of the date of this prospectus, we have less than 100 record stockholders with Nevada addresses. However, if these laws were to apply to us, they might discourage companies or persons interested in acquiring a significant interest in or control of the Company, regardless of whether such acquisition may be in the interest of our stockholders.

**Listing** 

Our Common Stock is listed on the Nasdaq under the symbol "IVP".

**Transfer Agent and Registrar**

The transfer agent and registrar for our Common Stock is VStock Transfer, LLC.

**PRIVATE PLACEMENT OF SERIES B PREFERRED STOCK, WARRANTS AND CONVERTIBLE NOTES**

This prospectus relates to the potential offer and resale by the selling stockholders identified in this prospectus or their permitted transferees (the "Selling Stockholders") of up to 46,419,092 shares of our Class A common stock, $0.0001 par value per share, (the "Common Stock") consisting of (i) up to 26,194,092 shares issuable upon conversion of Series B convertible preferred stock ("Series B Preferred Stock") pursuant to that certain securities purchase agreement dated July 28, 2025 (the "Private Placement"), (ii) 7,725,000 shares of Common Stock issuable upon the exercise of warrants (at an exercise price of $1.00 per share), issued to investors in the Private Placement, and (iii) up to 12,500,000 shares issuable upon conversion of the Target Notes.

***Private Placement***

On July 28, 2025, the Company entered into a securities purchase agreement (the "Securities Purchase Agreement") with certain accredited investors named therein. Pursuant to the Securities Purchase Agreement, up to 7,593 shares of the Company's Series B convertible preferred stock, par value $0.0001 per share (the "Series B Preferred Stock") and accompanying warrants ("Warrants") to purchase shares of the Company's common stock, par value $0.0001 per share (the "Common Stock") may be purchased for an aggregate purchase price of up to $10 million in one or more closings (each a "Closing"). On July 29, 2025, pursuant to the Securities Purchase Agreement, the Company issued and sold, and certain investors purchased, in a private placement (the "Private Placement"): 6,340 shares of the Series B Preferred Stock and 6,340,000 Warrants to purchase shares of Common Stock for aggregate proceeds of approximately $5 million, paid in cash or through the transfer of certain Transfer Shares (as defined in the Securities Purchase Agreement) in lieu of cash. On September 9, 2025, we completed an additional closing, issuing 1,253 shares of Series B preferred stock and 1,252,500 warrants for aggregate proceeds of approximately $1 million. On December 1, 2025, the Company entered into an agreement to permit it to redeem 2,027 shares of Series B preferred stock for approximately $2.7 million.

The Warrants expire on the fifth anniversary of their initial exercisability date and have an initial exercise price of $1.00, subject to adjustment as set forth therein. Following the Stockholder Approval Date (as defined below), the exercise price of the Warrants will be subject to adjustment upon lower priced securities issuances, or upon certain triggering events which consist of specific types of default under the terms of the transaction documents. In no event can the conversion and exercise price go below $0.05, subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations and similar events.

*Series B Preferred Stock*

The Company has designated 10,000 shares of the Company's authorized and unissued preferred stock as Series B Preferred Stock (the "Series B Shares") and established the rights, preferences and privileges of the Series B Preferred Stock pursuant to the Certificate of Designations of Rights and Preferences of the Series B Preferred Stock (the "Certificate of Designations"), as summarized below:

*General*. Each share of Series B Preferred Stock has a stated value of $1,000 per share and, when issued, the Series B Preferred Stock will be fully paid and non-assessable.

*Ranking*. The Series B Preferred Stock, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company, ranks senior to all capital stock of the Company unless the Required Holders (as defined in the Certificate of Designations) consent to the creation of other capital stock of the Company that is senior or equal in rank to the Series B Preferred Stock.

*Dividends*. The holders of Series B Preferred Stock will be entitled to dividends, on an as-if converted basis, equal to and in the same form as dividends actually paid on shares of the Company's Common Stock, when and if actually paid.

*Purchase Rights*. If at any time the Company grants, issues or sells any options, convertible securities, or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of any class of Common Stock (the "Purchase Rights"), then each holder of Series B Preferred Stock will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such holder could have acquired if such holder had held the number of shares of Common Stock acquirable upon complete conversion of all the Series B Preferred Stock held by such holder immediately prior to the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights at the Alternate Conversion Price (as defined below); subject to certain limitations on beneficial ownership.

*Conversion Rights*

*Conversion at Option of Holder*. Each holder of Series B Preferred Stock may convert all, or any part, of the outstanding Series B Preferred Stock, at any time at such holder's option, into shares of the Common Stock (which converted shares of Common Stock are referred to as "Conversion Shares" herein) at the fixed "Conversion Price" of $1.00 which is subject to proportional adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions.

*Voluntary Adjustment Right*. Subject to the rules and regulations of the Nasdaq, the Company has the right, at any time, with the written consent of the Required Holders, to lower the fixed conversion price to any amount and for any period of time deemed appropriate by the board of directors of the Company.

*Alternate Conversion Upon a Triggering Event*. Following the occurrence and during the continuance of a Triggering Event (as defined below), each holder may alternatively elect to convert the Series B Preferred Stock at the "Alternate Conversion Price" equal to the lesser of: (i) the applicable conversion price, and the greater of (A) the floor price of $0.1879 (the "Floor Price"); and (B) 80% of the lowest volume weighted average price of the Common Stock during the five consecutive trading days immediately prior to such conversion. On December 1, 2025, the Company entered into an agreement with the Required Holders under the Certificate of Designation, to lower the Floor Price to $0.05.

The Certificate of Designations contains standard and customary triggering events (each, a "Triggering Event"), including but not limited to: (i) the suspension from trading or the failure to list the Common Stock within certain time periods; (ii) failure to declare or pay any dividend when due; (iii) the failure to timely file or make effective a registration statement on Form S-1 or Form S-3 pursuant to the Registration Rights Agreement (as defined below), (iv) the Company's failure to cure a conversion failure or notice of the Company's intention not to comply with a request for conversion of any Series B Preferred Stock, and (iv) bankruptcy or insolvency of the Company.

*Other Adjustments*. In connection with the Private Placement, the Company has agreed to seek stockholder approval at a special meeting of stockholders, of the issuance of conversion shares at a conversion price below the conversion price (the date of such approval, the "Stockholder Approval Date"). Stockholder approval was obtained on September 10, 2025.

If 30 days and 60 days following the occurrence of the later of (x) the Stockholder Approval Date and (y) the earlier of (a) the effective date of the registration statement to be filed pursuant to the Registration Rights Agreement and (b) the date that the Series B Preferred Stock is eligible to be resold without restriction under Rule 144 of the Securities Act of 1933, as amended (the "Securities Act"), the Conversion Price then in effect is greater than the greater of the Floor Price and the Market Price (as defined in the Certificate of Designations) then in effect (each, an "Adjustment Price"), the conversion price shall automatically lower to such Adjustment Price.

*Change of Control Exchange*. Upon a change of control of the Company, each holder may require the Company to exchange the holder's shares of Series B Preferred Stock for consideration equal to the Change of Control Election Price (as defined in the Certificate of Designations), to be satisfied at the Company's election in either (x) cash or (y) rights convertible into such securities or other assets to which such holder would have been entitled with respect to such shares of Common Stock had such shares of Common Stock been held by such holder upon consummation of such corporate event.

*Company Optional Redemption*. At any time the Company shall have the right to redeem in cash all, but not less than all, the shares of Series B Preferred Stock then outstanding at a redemption price equal to 125% of the greater of (i) the Conversion Amount being redeemed as of the Company optional redemption date and (ii) the product of (1) the conversion rate with respect to the Conversion Amount being redeemed as of the Company optional redemption date multiplied by (2) the greatest closing sale price of the Common Stock on any Trading Day during the period commencing on the date immediately preceding such Company optional redemption notice date and ending on the Trading Day immediately prior to the date the Company makes the entire payment required to be made.

*Fundamental Transactions*. The Certificate of Designations prohibit the Company from entering specified fundamental transactions (including, without limitation, mergers, business combinations and similar transactions) unless the Company (or the Company's successor) assumes in writing all of the Company's obligations under the Certificate of Designations and the other Transaction Documents (as defined in the Certificate of Designations).

*Voting Rights*. The holders of the Series B Preferred Stock shall have no voting power and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock, except as provided in the Certificate of Designations (or as otherwise required by applicable law).

*Covenants*. The Certificate of Designations contains a variety of obligations on the Company's part not to engage in specified activities. In particular, the Company will not, and will cause the Company's subsidiaries to not, redeem, repurchase or declare any dividend or distribution on any of the Company's capital stock (other than as required under the Certificate of Designations) and will not incur any indebtedness other than ordinary course trade payables or, subject to certain exceptions, incur any liens. In addition, the Company will not issue any preferred stock or issue any other securities that would cause a breach or default under the Certificate of Designations.

*Reservation Requirements*. So long as any Series B Preferred Stock remains outstanding, the Company shall at all times reserve at least 250% of the number of shares of Common Stock as shall from time to time be necessary to effect the conversion of all Series B Preferred Stock then outstanding.

***Target Notes***

On June 10, 2025, the Company issued to Target a promissory note in the principal amount of $625,000, with an original issue discount of $125,000 such that the purchase price was $500,000 (the "Target Note").

The Target Note shall not exceed the maximum amount of such interest permitted by law to be charged and a maturity date of the earlier of (i) six months from the issuance date, or (ii) the close of any capital raise conducted by the Company. The proceeds from the Target Note are for general working capital.

The Company has the right to prepay the Target Note at any time prior to the maturity date without penalty. In the event of the closing of any capital raise conducted by the Company, no less than 50% of the net proceeds shall be used to repay the Target Note, until the Target Note is paid in full.

After an occurrence of an event of default, as described in the Target Note, it shall become immediately due and payable and the original issue discount shall increase from 20% to 40%.

On June 30, 2025, the Company issued to Target a second promissory note in the principal amount of $625,000, with an original issue discount of $125,000 such that the purchase price was $500,000 (collectively with the Target Note the "Target Notes").

The second promissory note has identical terms and provisions to the original Target Note.

On August 19, 2025, the Company and Target entered into an amendment for each of the Target Notes (the "Amendment"). Pursuant to the Amendment, Target Capital shall have the right, at its option, to convert all or any portion of the outstanding principal amount and any accrued but unpaid interest under the Target Notes into shares of the Company's Common Stock at a fixed conversion price of $1.00 per share (the "Fixed Conversion Price"), subject to customary adjustments for stock splits, combinations, reclassifications, and similar events. Following the occurrence and during the continuance of a Triggering Event (as defined below), Target Capital may alternatively elect to convert into Common Stock at the "Alternate Conversion Price" equal to the lesser of: (i) the applicable conversion price, and the greater of (A) the floor price of $0.1879 (the "Floor Price"); and (B) 80% of the lowest volume weighted average price of the Common Stock during the five consecutive trading days immediately prior to such conversion. The Floor Price was adjusted to $0.05 on December 4, 2025. A Triggering Event will mean: triggering events (each, a "Triggering Event"), including but not limited to: (i) the suspension from trading or the failure to list the Common Stock within certain time periods; (ii) failure to declare or pay any dividend when due; (iii) the Company's failure to cure a conversion failure or notice of the Company's intention not to comply with a request for conversion of any Common Stock, and (iv) bankruptcy or insolvency of the Company.

All other terms and provisions of the Target Notes shall remain in full force and effect and all other terms of the Target Notes shall remain unchanged.

**SELLING STOCKHOLDERS**

The shares of Common Stock being offered by the Selling Stockholders are those issuable to the Selling Stockholders upon conversion of the Series B Preferred Stock and exercise of the warrants. For additional information regarding the issuance of the Series B Preferred Stock and the warrants, see "Private Placement of Series B Preferred Stock" above. We are registering the shares of Common Stock in order to permit the Selling Stockholders to offer the shares for resale from time to time. Except for the ownership of the Series B Preferred Stock and the warrants issued pursuant to the Securities Purchase Agreement, the issuance of the senior convertible promissory notes to Keystone Capital Partners, LLC and Seven Knots, LLC and the common stock purchase agreement dated July 29, 2025 between the company and Seven Knots, LLC, the Selling Stockholders have not had any material relationship with us within the past three years.

The table below lists the Selling Stockholders and other information regarding the beneficial ownership (as determined under Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder) of the shares of Common Stock held by each of the Selling Stockholders. The second column lists the number of shares of Common Stock beneficially owned by the Selling Stockholders, based on their respective ownership of shares of Common Stock, Series B Preferred Stock and warrants, as of November 21, 2025, assuming conversion of the Series B Preferred Stock and exercise of the warrants held by each such Selling Stockholder on that date but taking account of any limitations on conversion and exercise set forth therein.

The third column lists the shares of Common Stock being offered by this prospectus by the Selling Stockholders and does not take in account any limitations on (i) conversion of the Series B Preferred Stock set forth therein or (ii) exercise of the warrants set forth therein.

In accordance with the terms of a registration rights agreement with the holders of the Series B Preferred Stock and warrants, this prospectus generally covers the resale of 250% of the sum of (i) the maximum number of shares of Common Stock issued or issuable pursuant to Certificate of Designations and (ii) the maximum number of shares of Common Stock issued or issuable upon exercise of the warrants, in each case, determined as if the outstanding Series B Preferred Stock and warrants were converted or exercised (as the case may be) in full (without regard to any limitations on conversion or exercise contained therein solely for the purpose of such calculation) at an alternate conversion price or exercise price (as the case may be) calculated as of the trading day immediately preceding the date this registration statement was initially filed with the SEC. Because the conversion price of the Series B Preferred Stock and the exercise price of the warrants may be adjusted, the number of shares that will actually be issued may be more or less than the number of shares being offered by this prospectus.

The fourth column assumes the sale of all of the shares offered by the Selling Stockholders pursuant to this prospectus.

Under the terms of the Series B Preferred Stock, the warrants and the Target Notes, a Selling Stockholder may not convert the Series B Preferred Stock or Target Notes or exercise the warrants to the extent (but only to the extent) such Selling Stockholder or any of its affiliates would beneficially own a number of shares of our common stock which would exceed 4.99% of the outstanding shares of the Company (the "Maximum Percentage"). The number of shares in the second column reflects these limitations. The Selling Stockholders may sell all, some or none of their shares in this offering. See "Plan of Distribution."

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Number of Shares of <br> Common Stock <br> Owned Prior to Offering<sup>(1)</sup>** | **Number of Shares of <br> Common Stock <br> Owned Prior to Offering<sup>(1)</sup>** | **Maximum Number of<br> Shares of Common** | **Number of Shares of<br> Common Stock Owned After<br> Offering<sup>(3)</sup>** | **Number of Shares of<br> Common Stock Owned After<br> Offering<sup>(3)</sup>** |
| <br>**Name of Selling Stockholder** | **Number of<br> Shares** | **Percentage of<br> Outstanding<br> Shares** | **Stock to be Offered<br> Pursuant to this<br> Prospectus<sup>(2)</sup>** | **Number of<br> Shares** | **Percentage of<br> Outstanding<br> Shares** |
| **Keystone Capital Partners, LLC<sup>(12)</sup>** | 1924517<sup>(4)</sup> | 4.99% | 8344642 |  |  |
| **Seven Knots, LLC<sup>(13)</sup>** | 1924517<sup>(5)</sup> | 4.99% | 13928583 |  |  |
| **First Fire Global Opportunities Fund, LLC<sup>(14)</sup>** | 1924517<sup>(6)</sup> | 4.99% | 2331854 |  |  |
| **Pinz Capital Special Opportunities Fund, LP<sup>(15)</sup>** | 1398218<br><sup>(7)</sup> | 3.6% | 1398218 |  |  |
| **Jim Fallon<sup>(16)</sup>** | 1924517<sup>(8)</sup> | 4.99% | 4650307 |  |  |
| **CREO Investments LLC<sup>(17)</sup>** | 1924517<sup>(9)</sup> | 4.99% | 2331854 |  |  |
| **KCP Fund I, LLC<sup>(18)</sup>** | 933635<br><sup>(10)</sup> | 2.4% | 933635 |  |  |
| **Target Capital 1, LLC<sup>(19)</sup>** | 1250000<br><sup>(11)</sup> | 3.2% | 12500000 |  |  |

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\* less than 1%

(1) Applicable percentage ownership is based on 38,567,465 shares of our Common Stock outstanding as of November 21, 2025.

(2) Assumes the sale of all shares of Common Stock being offered pursuant to this prospectus. For the purposes of the calculations of shares of Common Stock to be sold pursuant to this prospectus we are assuming (a) the shares of Series B Preferred Stock are each converted without regard to any limitations set forth in the Certificate of Designations, (b) dividends on the shares of Series B Preferred Stock have not accrued, and (c) the exercise of all of the warrants in full without regard to any limitations on exercise set forth in the warrants.

(3) Represents the amount of shares that will be held by the Selling Stockholder after completion of this offering based on the assumptions that (a) all shares of Common Stock underlying the Series B Preferred Stock and warrants registered for sale by the registration statement of which this Prospectus is part of will be sold and (b) no other shares of Common Stock are acquired or sold by the Selling Stockholders prior to completion of this offering. However, the Selling Stockholders may sell all, some or none of such shares offered pursuant to this prospectus and may sell other shares of Common Stock that they may own pursuant to another registration statement under the Securities Act or sell some or all of their shares pursuant to an exemption from the registration provisions of the Securities Act, including under Rule 144.

(4) Represents the number of shares of our Common Stock beneficially owned
by this Selling Stockholder as of November 21, 2025 after giving effect to the Maximum Percentage. Without regard to the Maximum Percentage,
this Selling Stockholder would beneficially own an aggregate of 13,074,637 shares of our Common Stock, consisting of (i) 7,582,137 shares
of Common Stock underlying the outstanding Series B Preferred Stock held by the Selling Stockholder at an assumed conversion price of
$0.69 per share; and (ii) 5,492,500 shares of Common Stock issuable upon exercise of the warrants held by this Selling Stockholder.

(5) Represents the number of shares of our Common Stock beneficially owned
by this Selling Stockholder as of November 21, 2025 after giving effect to the Maximum Percentage. Without regard to the Maximum Percentage,
this Selling Stockholder would beneficially own an aggregate of 20,513,552 shares of our Common Stock, consisting of (i) 11,896,052 shares
of Common Stock underlying the outstanding Series B Preferred Stock held by the Selling Stockholder at an assumed conversion price of
$0.69 per share,; and (ii) 8,617,500 shares of Common Stock issuable upon exercise of the warrants held by this Selling Stockholder.

(6) Represents the number of shares
 of our Common Stock beneficially owned by this Selling Stockholder as of November 21, 2025 after
 giving effect to the Maximum Percentage. Without regard to the Maximum Percentage, this Selling Stockholder
 would beneficially own an aggregate of 2,331,854 shares of our Common Stock, consisting of (i) 1,800,779
 shares of Common Stock underlying the outstanding Series B Preferred Stock held by the Selling Stockholder
 at an assumed conversion price of $0.69 per share; and (ii) 531,075 shares of Common Stock issuable
 upon exercise of the warrants held by this Selling Stockholder.

(7) Represents the number of shares
 of our Common Stock beneficially owned by this Selling Stockholder as of November 21, 2025.

(8) Represents the number of shares
 of our Common Stock beneficially owned by this Selling Stockholder as of November 21, 2025 after
 giving effect to the Maximum Percentage. Without regard to the Maximum Percentage, this Selling Stockholder
 would beneficially own an aggregate of 4,650,307 shares of our Common Stock, consisting of (i) 3,591,209
 shares of Common Stock underlying the outstanding Series B Preferred Stock held by the Selling Stockholder
 at an assumed conversion price of $0.69 per share; and (ii) 1,059,097 shares of Common Stock issuable
 upon exercise of the warrants held by this Selling Stockholder.

(9) Represents the number of shares
 of our Common Stock beneficially owned by this Selling Stockholder as of November 21, 2025 after
 giving effect to the Maximum Percentage. Without regard to the Maximum Percentage, this Selling Stockholder
 would beneficially own an aggregate of 2,331,854 shares of our Common Stock, consisting of (i) 1,800,779
 shares of Common Stock underlying the outstanding Series B Preferred Stock held by the Selling Stockholder
 at an assumed conversion price of $0.69 per share; and (ii) 531,075 shares of Common Stock issuable
 upon exercise of the warrants held by this Selling Stockholder.

(10) Represents the number of shares of our Common Stock beneficially owned by this Selling Stockholder
 as of November 21, 2025.

(11) Represents
 shares of Common Stock issuable upon the conversion of the Target Notes at a conversion price of $1.00 per share. The shares being
 registered for this Selling Stockholder assumes an alternate conversion price of $0.10 per share.

(12) Keystone Capital Partners LLC is managed by RANZ Group LLC. Frederic
 Zaino in his capacity as the Managing Member of RANZ Group LLC, may be deemed to have investment discretion and voting power over
 the shares held by Keystone Capital Partners LLC. RANZ Group LLC and Mr. Zaino each disclaim any beneficial ownership of these shares.
 The business address of Keystone Capital Partners, LLC is 139 Fulton Street, Suite 412, New York, NY 10038.

(13) Seven Knots, LLC is managed by Marissa Welner. Ms. Welner in her
 capacity as Manager of Seven Knots, LLC may be deemed to have investment discretion and voting power over the shares held by Seven
 Knots, LLC. Ms. Welner disclaims any beneficial ownership of these shares. The business address of Seven Knots, LLC is 400 E 66th
 Street, New York, New York 10065.

(14) First Fire Global Opportunities Fund, LLC is managed by Eli Fireman.
 Mr. Fireman in capacity as Manager may be deemed to have investment discretion and voting power over the shares held by First Fire
 Global Opportunities Fund, LLC. Mr. Fireman disclaims any beneficial ownership of these shares. The business address of First Fire
 Global Opportunities Fund, LLC 1040 1st Ave, Suite 190, New York, NY 10022.

(15) Pinz Capital Special Opportunities Fund, LP's Chief Investment
 Officer is Matthew Pinz. Mr. Pinz in his capacity as the Chief Investment Officer may be deemed to have investment discretion and
 voting power over the shares held by Pinz Capital Special Opportunities Fund, LP. Mr. Pinz disclaims any beneficial ownership of
 these shares. The business address of Pinz Capital Special Opportunities Fund, LP is 27 Hospital Road, George Town, Grand Cayman,
 KY1-9008, Cayman Islands.

(16) Jim Fallon has sole voting and dispositive power with respect to
the shares held by him.

(17) CREO Investments LLC is managed by Andrew Cohen. Mr. Cohen in capacity
 as Manager may be deemed to have investment discretion and voting power over the shares held by CREO Investments LLC. Mr. Cohen disclaims
 any beneficial ownership of these shares. The business address of CREO Investments LLC is 16192 Coastal Highway, Lewes, Delaware
 19958.

(18) KCP Fund I, LLC is managed by RANZ Group LLC. Frederic Zaino in his capacity as the Managing Member
 of RANZ Group LLC, may be deemed to have investment discretion and voting power over the shares held by KCP Fund I, LLC. RANZ Group
 LLC and Mr. Zaino each disclaim any beneficial ownership of these shares. The business address of KCP Fund I, LLC is 139 Fulton Street,
 Suite 412, New York, NY 10038.

(19) Target
 Capital 1 LLC's General Partner is Dmitriy Shapiro. Mr. Shapiro in his capacity as the General Partner of Target Capital 1
 LLC, may be deemed to have investment discretion and voting power over the shares held by Target Capital 1 LLC. Mr. Shapiro disclaims
 any beneficial ownership of these shares. The business address of Target Capital 1 LLC is 144 Hillside Village, Rio Grande, Puerto
 Rico 00745.

The Company may supplement this prospectus from time to time as required by the rules of the SEC to include certain information concerning the security ownership of the Selling Stockholders, the number of securities offered for resale and the position, office, or other material relationship which a Selling Stockholder has had within the past three years with the Company or any of its predecessors or affiliates.

**PLAN OF DISTRIBUTION**

We are registering the shares of Common Stock issuable upon conversion of the Series B Preferred Stock and exercise of the warrants to permit the resale of these shares of Common Stock by the holders of the Series B Preferred Stock and warrants from time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by the Selling Stockholders of the shares of Common Stock, although we will receive the exercise price of any warrants not exercised by the Selling Stockholders on a cashless exercise basis. We will bear all fees and expenses incident to our obligation to register the shares of Common Stock.

The Selling Stockholders may sell all or a portion of the shares of Common Stock held by them and offered hereby from time to time directly or through one or more underwriters, broker-dealers or agents. If the shares of Common Stock are sold through underwriters or broker-dealers, the Selling Stockholders will be responsible for underwriting discounts or commissions or agent's commissions. The shares of Common Stock may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. These sales may be effected in transactions, which may involve crosses or block transactions, pursuant to one or more of the following methods:

● on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale

● in the over-the-counter market;

● in transactions otherwise than on these exchanges or systems or in the over-the-counter market;

● through the writing or settlement of options, whether such options are listed on an options exchange or otherwise;

● ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

● block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;

● purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

● an exchange distribution in accordance with the rules of the applicable exchange;

● privately negotiated transactions;

● short sales made after the date the Registration Statement is declared effective by the SEC;

● broker-dealers may agree with a selling security holder to sell a specified number of such shares at a stipulated price per share;

● a combination of any such methods of sale; and

● any other method permitted pursuant to applicable law.

The Selling Stockholders may also sell shares of Common Stock under Rule 144 promulgated under the Securities Act of 1933, as amended, if available, rather than under this prospectus. In addition, the Selling Stockholders may transfer the shares of Common Stock by other means not described in this prospectus. If the Selling Stockholders effect such transactions by selling shares of Common Stock to or through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions from the Selling Stockholders or commissions from purchasers of the shares of Common Stock for whom they may act as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers or agents may be in excess of those customary in the types of transactions involved). In connection with sales of the shares of Common Stock or otherwise, the Selling Stockholders may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the shares of Common Stock in the course of hedging in positions they assume. The Selling Stockholders may also sell shares of Common Stock short and deliver shares of Common Stock covered by this prospectus to close out short positions and to return borrowed shares in connection with such short sales. The Selling Stockholders may also loan or pledge shares of Common Stock to broker-dealers that in turn may sell such shares.

The Selling Stockholders may pledge or grant a security interest in some or all of the Series B Preferred Stock, warrants or shares of Common Stock owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of Common Stock from time to time pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending, if necessary, the list of Selling Stockholders to include the pledgee, transferee or other successors in interest as Selling Stockholders under this prospectus. The Selling Stockholders also may transfer and donate the shares of Common Stock in other circumstances in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.

To the extent required by the Securities Act and the rules and regulations thereunder, the Selling Stockholders and any broker-dealer participating in the distribution of the shares of Common Stock may be deemed to be "underwriters" within the meaning of the Securities Act, and any commission paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under the Securities Act. At the time a particular offering of the shares of Common Stock is made, a prospectus supplement, if required, will be distributed, which will set forth the aggregate amount of shares of Common Stock being offered and the terms of the offering, including the name or names of any broker-dealers or agents, any discounts, commissions and other terms constituting compensation from the Selling Stockholders and any discounts, commissions or concessions allowed or re-allowed or paid to broker-dealers.

Under the securities laws of some states, the shares of Common Stock may be sold in such states only through registered or licensed brokers or dealers. In addition, in some states the shares of Common Stock may not be sold unless such shares have been registered or qualified for sale in such state or an exemption from registration or qualification is available and is complied with.

There can be no assurance that any Selling Stockholder will sell any or all of the shares of Common Stock registered pursuant to the registration statement, of which this prospectus forms a part.

The Selling Stockholders and any other person participating in such distribution will be subject to applicable provisions of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, including, without limitation, to the extent applicable, Regulation M of the Exchange Act, which may limit the timing of purchases and sales of any of the shares of Common Stock by the Selling Stockholders and any other participating person. To the extent applicable, Regulation M may also restrict the ability of any person engaged in the distribution of the shares of Common Stock to engage in market-making activities with respect to the shares of Common Stock. All of the foregoing may affect the marketability of the shares of Common Stock and the ability of any person or entity to engage in market-making activities with respect to the shares of Common Stock.

We will pay all expenses of the registration of the shares of Common Stock pursuant to the registration rights agreement. Securities and Exchange Commission filing fees and expenses of compliance with state securities or "blue sky" laws; provided, however, a selling shareholder will pay all underwriting discounts and selling commissions, if any. We will indemnify the selling shareholders against liabilities, including some liabilities under the Securities Act in accordance with the registration rights agreements or the selling shareholders will be entitled to contribution. We may be indemnified by the Selling Stockholders against civil liabilities, including liabilities under the Securities Act that may arise from any written information furnished to us by the Selling Stockholder specifically for use in this prospectus, in accordance with the related registration rights agreements or we may be entitled to contribution.

Once sold under the registration statement, of which this prospectus forms a part, the shares of Common Stock will be freely tradable in the hands of persons other than our affiliates.

**LEGAL MATTERS**

The Crone Law Group P.C. will pass upon the validity of the securities offered in this offering.

**EXPERTS**

The consolidated financial statements as of December 31, 2024 and December 31, 2023 included in this prospectus and in the registration statement have been so included in reliance on the report of Kreit & Chiu CPA LLP, an independent registered public accounting firm, appearing elsewhere herein and in the registration statement, given on the authority of said firm as experts in auditing and accounting.

**WHERE YOU CAN FIND MORE INFORMATION**

We have filed with the SEC, under the Securities Act, a registration statement on Form S-1 relating to the securities offered hereby. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto. For further information with respect to our company and the securities we are offering by this prospectus you should refer to the registration statement, including the exhibits and schedules thereto. The SEC also maintains an Internet site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The SEC's website address is http://www.sec.gov.

We are subject to the information and periodic reporting requirements of the Exchange Act and, in accordance therewith, we file periodic reports, proxy statements and other information with the SEC. Such periodic reports, proxy statements and other information are available for inspection and copying at the website of the SEC referred to above. We maintain a website at www.inspirevet.com. You may access our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed pursuant to Sections 13(a) or 15(d) of the Exchange Act with the SEC free of charge at our website as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. Our website and the information contained on that site, or connected to that site, are not incorporated into and are not a part of this prospectus.

**INDEX TO THE INSPIRE VETERINARY PARTNERS, INC AND SUBISIDIARIES FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
| **Index** | **Page** |
| [Unaudited Condensed Consolidated Balance Sheets](#k_015) | F-2 |
| [Unaudited Condensed Consolidated Statements of Operations](#k_016) | F-3 |
| [Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity <u>(Deficit)</u>](#k_017) | F-4 |
| [Unaudited Condensed Consolidated Statements of Cash Flows](#k_018) | F-6 |
| [Notes to Consolidated Financial Statements](#k_019) | F-7 |
| [Report of the Independent Public Accounting Firm on the Consolidated Financial Statements (Firm ID # 6651)](#f_001) | F-31 |
| [Consolidated Balance Sheets as of December 31, 2024 and 202<u>3</u>](#f_002) | F-32 |
| [Consolidated Statements of Operations for the Years Ended December 31, 2024 and 202<u>3</u>](#f_003) | F-33 |
| [Consolidated Statements of Changes in Shareholders' Deficit for the Years Ended December 31, 2024 and 202<u>3</u>](#f_004) | F-34 |
| [Consolidated Statements of Cash Flows for the Years Ended December 31, 2024 and 202<u>3</u>](#f_005) | F-35 |
| [Notes to the Consolidated Financial Statements](#f_006) | F-36 |

---

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Unaudited Condensed Consolidated Balance Sheets**

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
|  | **(Unaudited)** | |
| **Assets** |  |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $341746 | $523690 |
| &nbsp;&nbsp;&nbsp;Accounts receivable, net | 28704 | 40675 |
| &nbsp;&nbsp;&nbsp;Inventory | 497614 | 516650 |
| &nbsp;&nbsp;&nbsp;Investments – equity securities | 2571429 |  |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 385055 | 942456 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 3824548 | 2023471 |
| &nbsp;&nbsp;&nbsp;Restricted cash - non-current | 234500 | 200000 |
| &nbsp;&nbsp;&nbsp;Property and equipment, net | 6889958 | 6382788 |
| &nbsp;&nbsp;&nbsp;Right-of-use assets | 1695171 | 1879729 |
| &nbsp;&nbsp;&nbsp;Intangibles assets | 1175099 | 1633927 |
| &nbsp;&nbsp;&nbsp;Goodwill | 9088263 | 8022082 |
| &nbsp;&nbsp;&nbsp;Deferred financing costs | 1000000 |  |
| &nbsp;&nbsp;&nbsp;Other assets | 48227 | 53997 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $23955766 | $20195994 |
| **Liabilities and Stockholder's Deficit** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $1700265 | 1979503 |
| &nbsp;&nbsp;&nbsp;Accrued expenses | 969940 | 285770 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | 170774 | 183981 |
| &nbsp;&nbsp;&nbsp;Loans payable, net of discount | 2057740 | 2340020 |
| &nbsp;&nbsp;&nbsp;Convertible notes payable | 274908 |  |
| &nbsp;&nbsp;&nbsp;Promissory note | 1120623 |  |
| &nbsp;&nbsp;&nbsp;Notes payable, net of discount | 3424599 | 3410465 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 9718849 | 8199739 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities, non-current | 1813828 | 1943487 |
| &nbsp;&nbsp;&nbsp;Notes payable - noncurrent | 8254408 | 8490763 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 19787085 | 18633989 |
| Commitments and Contingencies (Note 15) |  |  |
| Stockholder's Equity (Deficit) |  |  |
| &nbsp;&nbsp;&nbsp;Common stock - Class A, $0.0001 par value, 100 million shares authorized, 3,609,285 and 1,176,059 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively. | 360 | 117 |
| &nbsp;&nbsp;&nbsp;Common stock - Class B, $0.0001 par value, 20 million shares authorized, 3,020,750 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively. | 302 | 302 |
| &nbsp;&nbsp;&nbsp;Preferred stock - Convertible Series B, $0.0001 par value, 10,000 and 0 shares authorized as of September 30, 2025 and December 31, 2024, respectively, and 7,593 and 0 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively. | 1 |  |
| &nbsp;&nbsp;&nbsp;Additional paid in capital | 48494176 | 37911867 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (44326158) | (36350281) |
| &nbsp;&nbsp;&nbsp;Total stockholder's equity (deficit) | 4168681 | 1562005 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and stockholder's equity (deficit) | $23955766 | $20195994 |

---

See accompanying unaudited notes to the condensed consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Unaudited Condensed Consolidated Statements of Operations**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> September 30,** | **For the Three Months Ended<br> September 30,** | **For the Nine Months Ended<br> September 30,** | **For the Nine Months Ended<br> September 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Service revenue | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3138670 | $2969748 | $9074965 | $9735585 |
| Product revenue | 1177462 | 1079277 | 3163910 | 3535388 |
| &nbsp;&nbsp;&nbsp;Total revenue | 4316132 | 4049025 | 12238875 | 13270973 |
| Operating expenses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 2678940 | 2568085 | 7253536 | 7705972 |
| &nbsp;&nbsp;&nbsp;Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 850153 | 854921 | 2507227 | 2807025 |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | 2423707 | 2988122 | 7514420 | 8080199 |
| &nbsp;&nbsp;&nbsp;Debt extinguishment loss |  |  | 689411 | 1587862 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 330498 | 340167 | 864293 | 1048290 |
| &nbsp;&nbsp;&nbsp;Gain on sale of business | - | (467049) | - | (467049) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 6283298 | 6284246 | 18828887 | 20762299 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss from operations | (1967166) | (2235221) | (6590012) | (7491326) |
| Other income (expenses): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 4 | 44 | 25 | 46 |
| &nbsp;&nbsp;&nbsp;Interest expense | (559111) | (1254149) | (1385891) | (2801491) |
| &nbsp;&nbsp;&nbsp;Other income (expenses) | - | - | - | (4768) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expenses | (559108) | (1254105) | (1385866) | (2806213) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss before income taxes | (2526273) | (3489326) | (7975878) | (10297539) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Benefit for income taxes | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | (2526273) | (3489326) | (7975878) | (10297539) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend on convertible series A preferred stock | - | - | - | (220850) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss attributable to class A and B common stockholders | $(2526273) | $(3489326) | $(7975878) | $(10518389) |
| &nbsp;&nbsp;&nbsp;Net loss per Class A and B common shares: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | $(0.41) | $(0.85) | $(1.55) | $(2.64) |
| &nbsp;&nbsp;&nbsp;Weighted average shares outstanding per Class A and B common shares: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | 6091057 | 4112531 | 5154703 | 3989343 |

---

See accompanying unaudited notes to the condensed consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit)**

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Convertible <br> Series A** | **Convertible <br> Series A** | **Convertible<br> Series B** | **Convertible<br> Series B** | **Class A** | **Class A** | **Class B** | **Class B** | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | **Common Stock** | **Common Stock** | | | |
|  | **No. of**<br>**Shares** |<br>**Amount** | **No. of**<br>**Shares** |<br>**Amount** | **No. of**<br>**Shares** |<br>**Amount** | **No. of**<br>**Shares** |<br>**Amount** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** |<br>**Stockholders'**<br>**Equity**<br>**(Deficit)** |
| **Balance as of December 31, 2024** |  | $**-** | **-** | $**-** | **1176059** | $**117** | **3020750** | $**302** | $**37911867** | $**(36350281)** | $**1562005** |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock, net of issuance costs |  |  |  |  | 651167 | 65 |  |  | 2285456 |  | 2285521 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock and pre-funded warrants, net of issuance costs |  |  |  |  | 207896 | 21 |  |  | 1571445 |  | 1571466 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  |  |  | 84429 | 8 |  |  | (8) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | - | - | - | - | - | (2415036) | (2415036) |
| **Balance as of March 31, 2025** |  | $**-** | **-** | $**-** | **2119551** | $**211** | **3020750** | $**302** | $**41768760** | $**(38765317)** | $**3003956** |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of common stock in connection with business acquisition |  |  |  |  | 54734 | 5 |  |  | 92495 |  | 92500 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock for services |  |  |  |  | 150000 | 15 |  |  | 245085 |  | 245100 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  |  |  |  |  | 139274 |  | 139274 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | - | - | - | - | - | (3034568) | (3034568) |
| **Balance as of June 30, 2025** |  | $**-** | **-** | $**-** | **2324285** | $**231** | **3020750** | $**302** | $**42245614** | $**(41799885)** | $**446262** |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock for services |  |  |  |  | 400000 | 40 |  |  | 454560 |  | 454600 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  |  |  | 885000 | 89 |  |  | (89) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of Series B preferred stock and warrants in exchange for cash and equity securities investment, net of issuance costs |  |  | 7593 | 1 |  |  |  |  | 5794091 |  | 5794092 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | - | - | - | - | - | (2526273) | (2526273) |
| **Balance as of September 30, 2025** |  | $**-** | **7593** | $**1** | **3609285** | $**360** | **3020750** | $**302** | $**48494176** | $**(44326158)** | $**4168681** |

---

See accompanying unaudited notes to the condensed consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit)**

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Convertible <br> Series A** | **Convertible <br> Series A** | **Convertible<br> Series B** | **Convertible<br> Series B** | **Class A** | **Class A** | **Class B** | **Class B** | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | **Common Stock** | **Common Stock** | | | |
|  | **No. of**<br>**Shares** |<br>**Amount** | **No. of**<br>**Shares** |<br>**Amount** | **No. of**<br>**Shares** |<br>**Amount** | **No. of**<br>**Shares** |<br>**Amount** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** |<br>**Stockholders'**<br>**Equity**<br>**(Deficit)** |
| **Balance as of December 31, 2023** | 403640 | $40 |  | $- | 2817 | $- | 3891500 | $389 | $20426569 | $(21215257) | $(788259) |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock and pre-funded warrants, net of issuance costs |  |  |  |  | 1144 |  |  |  | 3375458 |  | 3375458 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  |  |  | 17680 | 2 |  |  | (2) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of Class A common stock and pre-funded warrants in connection with commitment shares |  |  |  |  | 486 |  |  |  | 600000 |  | 600000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of convertible series A preferred stock | 20000 | 2 |  |  |  |  |  |  | 199998 |  | 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock for services |  |  |  |  | 1562 |  |  |  | 286696 |  | 286696 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock in connection with general release agreement |  |  |  |  | 98 |  |  |  | 20000 |  | 20000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible series A preferred stock into class A common stock | (363725) | (36) |  |  | 5916 | 1 |  |  | 35 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock cumulative dividends |  |  |  |  |  |  |  |  | (2250) |  | (2250) |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock dividend | 21227 | 2 |  |  |  |  |  |  | 212268 | (212270) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | - | - |  | - | - | - | - | - | - | (3421792) | (3421792) |
| **Balance as of March 31, 2024** | **81142** | $**8** |  | $**-** | **29703** | $**3** | **3891500** | $**389** | $**25118772** | $**(24849319)** | $**269853** |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  |  |  | 4100 |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible series A preferred stock into class A common stock | (54771) | (5) |  |  | 7960 | 1 |  |  | 4 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock dividend | 858 |  |  |  |  |  |  |  | 10830 | (8580) | 2250 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | - | - |  | - | - | - | - | - | - | (3386421) | (3386421) |
| **Balance as of June 30, 2024** | **27229** | $**3** |  | $**-** | **41763** | $**4** | **3891500** | $**389** | $**25129606** | $**(28244320)** | $**(3114318)** |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock and warrants, net of issuance costs |  |  |  |  | 5859 | 1 |  |  | 5459999 |  | 5460000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  |  |  | 234154 | 23 |  |  | (23) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of class A common stock warrants |  |  |  |  | 140000 | 14 |  |  | 3499986 |  | 3500000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible series A preferred stock into class A common stock | (27229) | (3) |  |  | 10892 | 1 |  |  | 2 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible notes payable |  |  |  |  | 101881 | 10 |  |  | 649990 |  | 650000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  |  |  |  |  | 23647 |  | 23647 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | - | - |  | - | - | - | - | - | - | (3489326) | (3489326) |
| **Balance as of September 30, 2024** | **-** | $**-** |  | $**-** | **534548** | $**53** | **3891500** | $**389** | $**34763207** | $**(31733646)** | $**3030003** |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock and pre-funded warrants, net of issuance costs |  |  |  |  | 72000 | 7 |  |  | 1851574 |  | 1851581 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  |  |  | 328000 | 33 |  |  | (33) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of class A common stock warrants |  |  |  |  | 100000 | 10 |  |  | 499990 |  | 500000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible notes payable |  |  |  |  | 124368 | 12 |  |  | 707131 |  | 707143 |
| &nbsp;&nbsp;&nbsp;&nbsp;Repurchase and cancellation of the class B common stock |  |  |  |  |  |  | (870750) | (87) |  | (649913) | (650000) |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock for services |  |  |  |  | 17143 | 2 |  |  | 89998 |  | 90000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | - | - |  | - | - | - | - | - | - | (3966722) | (3966722) |
| **Balance as of December 31, 2024** | **-** | $**-** |  | $**-** | **1176059** | $**117** | **3020750** | $**302** | $**37911867** | $**(36350281)** | $**1562005** |

---

See accompanying unaudited notes to the condensed consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Unaudited Condensed Consolidated Statements of Cash Flows**

---

| | | |
|:---|:---|:---|
|  | **For the Nine Months Ended** | **For the Nine Months Ended** |
|  | **September 30,** | **September 30,** |
|  | **2025** | **2024** |
| **Cash flows from operating activities:** |  |  |
| Net loss | $(7975878) | $(10297539) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 864293 | 1028475 |
| &nbsp;&nbsp;&nbsp;Amortization of debt issuance costs | 19177 | 15825 |
| &nbsp;&nbsp;&nbsp;Amortization of debt discount | 927945 | 2129380 |
| &nbsp;&nbsp;&nbsp;Amortization of operating right of use assets | 184558 | 269172 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 139274 | 23647 |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock for services | 699700 | 286696 |
| &nbsp;&nbsp;&nbsp;Loss on debt extinguishment | 689411 |  |
| &nbsp;&nbsp;&nbsp;Loss on debt modification |  | 1587862 |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock in connection with general release agreement |  | 20000 |
| &nbsp;&nbsp;&nbsp;Issuance of Class A common stock and pre-funded warrants in connection with commitment shares |  | 600000 |
| &nbsp;&nbsp;&nbsp;Gain on disposal of business |  | (467049) |
| Changes in operating assets and liabilities, net of effect of acquisitions: |  |  |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 11971 | (86978) |
| &nbsp;&nbsp;&nbsp;Due from former owners |  | 32519 |
| &nbsp;&nbsp;&nbsp;Inventory | 59036 | (34527) |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 557401 | (2701612) |
| &nbsp;&nbsp;&nbsp;Other assets | 5770 | (12220) |
| &nbsp;&nbsp;&nbsp;Accounts payable | (279238) | (1133012) |
| &nbsp;&nbsp;&nbsp;Accrued expenses | 684170 | (574196) |
| &nbsp;&nbsp;&nbsp;Cumulative Series A preferred stock dividends payable |  | (92322) |
| &nbsp;&nbsp;&nbsp;Other assets, net |  |  |
| &nbsp;&nbsp;&nbsp;Refundable income tax |  | 151796 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | (142866) | (74256) |
| Net cash used in operating activities | (3555276) | (9328339) |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment | (76315) | (206155) |
| &nbsp;&nbsp;&nbsp;Payment for acquisition of business | 1850000 | - |
| Net cash used in investing activities | (1926315) | (206155) |
| **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of class A common stock and warrants, net of issuance costs | 2285521 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of class A common stock and pre-funded warrants, net of issuance costs | 1571466 | 8835458 |
| &nbsp;&nbsp;&nbsp;Repurchase and cancellation of the class B common stock |  |  |
| &nbsp;&nbsp;&nbsp;Net proceeds from loans payable | 1020295 | 1467935 |
| &nbsp;&nbsp;&nbsp;Repayments on loans payable | (2774400) | (3916004) |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of convertible series A preferred stock |  | 200000 |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of convertible series B preferred stock | 2222663 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from convertible notes payable | 250000 | 1000000 |
| &nbsp;&nbsp;&nbsp;Payments on convertible notes payable |  | (250000) |
| &nbsp;&nbsp;&nbsp;Proceeds from notes payable, net of discount | 761190 |  |
| &nbsp;&nbsp;&nbsp;Repayment of notes payable | (1002588) | (700657) |
| &nbsp;&nbsp;&nbsp;Proceeds from exercise of warrants |  | 3500000 |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of promissory note | 1000000 |  |
| &nbsp;&nbsp;&nbsp;Repayment of convertible debentures | - | (100000) |
| Net cash provided by financing activities | 5334147 | 10036732 |
| &nbsp;&nbsp;&nbsp;Net increase (decrease) in Cash, cash equivalents and restricted cash | (147444) | 502238 |
| &nbsp;&nbsp;&nbsp;Cash, cash equivalents and restricted cash, beginning of period | 723690 | 378961 |
| &nbsp;&nbsp;&nbsp;Cash, cash equivalents and restricted cash, end of period | $576246 | $881199 |
| **Supplemental Disclosure of Cash Flow Information** |  |  |
| &nbsp;&nbsp;&nbsp;Interest payments during the year | $1385891 | $1552313 |
| &nbsp;&nbsp;&nbsp;Income tax refund | $- | $151796 |
| **Noncash investing and financing activity** |  |  |
| &nbsp;&nbsp;&nbsp;Acquisition of equity securities in connection with issuance of Series B Preferred Stock | $2571429 | $- |
| &nbsp;&nbsp;&nbsp;Issuance of common stock in connection with business acquisition | $92500 | $- |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock for conversion of convertible notes payable | $- | $650000 |
| &nbsp;&nbsp;&nbsp;Series A Preferred Stock Dividend | $- | $220850 |

---

See accompanying unaudited notes to the condensed consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**1. Description of Business**

**Business Description**

Inspire Veterinary Partners, Inc. (the "Company" or "Inspire") is a C-corporation which was incorporated in the state of Delaware on December 2, 2020. On June 29, 2022, the Company converted into a Nevada C-corporation ("Conversion"). The Conversion did not result in any change in the corporate name, business, management fiscal year, accounting, location of the principal executive officer, capitalization structure, or assets or liabilities of the Company. The Company owns and operates veterinary hospitals throughout the United States. The Company specializes in small animal general practice hospitals which serve all manner of companion pets, emphasizing canine and feline breeds.

As the Company expands, additional modalities are becoming a part of the offerings at its hospital, including equine care. With 14 clinics located in 9 states as of the date of this filing, Inspire purchases existing hospitals which have the financial track record, marketplace advantages and future growth potential to make them worthy acquisition targets. Because the company leverages a leadership and support structure which is distributed throughout the United States, acquisitions are not centralized to one geographic area. The Company operates its business as one operating and one reportable segment.

Services provided at owned hospitals include preventive care for companion animals consisting of annual health exams which include: parasite control; dental health; nutrition and body condition counseling; neurological examinations; radiology; bloodwork; skin and coat health and many breed specific preventive care services. Surgical offerings include all soft tissue procedures such as spays and neuters, mass removals, splenectomies and can also include gastropexies, orthopedic procedures and other types of surgical offerings based on a doctor's training. In many locations additional means of care and alternative procedures are also offered such as acupuncture, chiropractic and various other health and wellness offerings.

The Company is the managing member of IVP Practice Holdings Co., LLC ("Holdco"), a Delaware limited liability company, which is the managing member of IVP CO Holding, LLC ("CO Holdco"), a Delaware limited liability company, IVP FL Holding Co., LLC ("FL Holdco"), a Delaware limited liability company, IVP Texas Holding Company, LLC ("TX Holdco"), a Delaware limited liability company, KVC Holding Company, LLC ("KVC Holdco"), a Hawaii limited liability company, IVP CA Holding Co., LLC ("CA Holdco"), a Delaware limited liability company, IVP MD Holding Company, LLC ("MD Holdco"), a Delaware limited liability company, IVP OH Holding ("OH Holdco"), Co, LLC, a Delaware limited liability company, IVP IN Holding Co., LLC ("IN Holdco"), a Delaware limited liability company, IVP MA Managing Co., LLC, a Delaware limited liability company ("MA Holdco"), and IVP PA Holding Company, LLC, a Delaware limited liability company ("PA Holdco"). The Company through Holdco, operates and controls all business and affairs of CO Holdco, FL Holdco, TX Holdco, KVC Holdco, CA Holdco, MD Holdco, OH Holdco, IN Holdco, MA Holdco and PA Holdco. Holdco is used to acquire hospitals in various states and jurisdictions.

The Company is the managing member of IVP Real Estate Holding Co., LLC ("IVP RE"), a Delaware limited liability company, which is the managing member of IVP CO Properties, LLC ("CO RE"), a Delaware limited liability company, IVP FL Properties, LLC ("FL RE"), a Delaware limited liability company, IVP TX Properties, LLC ("TX RE"), a Delaware limited liability company, KVC Properties, LLC, ("KVC RE"), a Hawaii limited liability company, IVP CA Properties, LLC ("CA RE"), a Delaware limited liability company, IVP MD Properties, LLC ("MD RE"), a Delaware limited liability company, IVP OH Properties, LLC ("OH RE"), a Delaware limited liability company, IVP IN Properties, LLC ("IN RE"), a Delaware limited liability company, and IVP PA Properties, LLC ("PA RE"), a Delaware limited liability company. The Company through IVP RE operates and controls all business and affairs of CO RE, FL RE, TX RE, KVC RE, CA RE, MD RE, OH RE, IN RE and PA RE. IVP RE is used to acquire real property in various states and jurisdictions.

![](image_002.jpg)

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**2.** **Retrospective Adjustments**

On January 27, 2025, the Company effected a 25-for-1 reverse stock split ("Reverse Split") of the Company's authorized and outstanding shares of Class A common stock. All information included in these financial statements has been adjusted, on a retrospective basis for all periods presented to reflect the Reverse Split, unless otherwise stated.

**3.** **Significant Accounting Policies and Basis of Presentation**

**Basis of Presentation**

The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2024, which are included with the Company's Annual Report on Form 10-K and related amendments filed with the United States Securities Exchange Commission ("SEC"). Furthermore, the Company's significant accounting policies are disclosed in the audited consolidated financial statements for the years ended December 31, 2024 and 2023, included in the Company's Annual Report on Form 10-K filed with the SEC. Since the date of those audited consolidated financial statements, there have been no changes to the Company's significant accounting policies, except as noted below.

The accompanying unaudited interim condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America ("GAAP") for interim financial information. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification ("ASC") and as amended by Accounting Standards Updates ("ASU") of the Financial Accounting Standards Board ("FASB").

In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements for the periods presented reflect all adjustments, consisting of only normal recurring adjustments, necessary to fairly present the Company's financial position, results of operations, and cash flows. The December 31, 2024, consolidated balance sheet was derived from audited financial statements, but does not include all GAAP disclosures. The unaudited condensed consolidated financial statements for the interim periods are not necessarily indicative of results for the full year.

**Going Concern**

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring losses and as of September 30, 2025, had an accumulated deficit and negative working capital of $44,326,158 and $5,894,301, respectively. For the three and nine months ended September 30, 2025, the Company sustained a net loss of $2,526,273 and $7,975,878, respectively. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern for the next twelve months from the date these financial statements were issued. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is contingent upon its ability to obtain additional financing and to generate revenue and cash flow to meet its obligations on a timely basis. The Company will continue to seek to raise additional funding through debt or equity financing during the next twelve months from the date of issuance of these financial statements. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving these objectives.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**Principles of Consolidation**

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

**Use of Estimates**

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.

**Fair Value Measurement**

The fair value of the Company's financial assets and liabilities reflects management's estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

---

| | |
|:---|:---|
| **Level 1** | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. |

---

---

| | |
|:---|:---|
| **Level 2** | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. |

---

---

| | |
|:---|:---|
| **Level 3** | Unobservable inputs based on the Company's assessment of the assumptions that market participants would use in pricing the asset or liability. |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | **Fair Value Measurement** | **Fair Value Measurement** | **Fair Value Measurement** |
|  | **Fair Value at<br> September 30,**<br>**2025** | **Level 1** | **Level 2** | **Level 3** |
| Investment - Equity Securities | $2571429 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $2571429 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | **Fair Value Measurement** | **Fair Value Measurement** | **Fair Value Measurement** |
|  | **Fair Value at<br> December 31,** <br>**2024** | **Level 1** | **Level 2** | **Level 3** |
| Investment - Equity Securities | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |

---

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

For the Company's equity securities measured at fair value on a recurring basis using significant unobservable inputs (Level 3), the following table provides a reconciliation of the beginning and ending balance for each category therein, and gains or losses recognized during the three and nine months ended September 30, 2025:

---

| | |
|:---|:---|
| Beginning Balance - December 31, 2024 | $- |
| Equity securities acquired as consideration for issuance of Series B Preferred Stock | 2571429 |
| Re-measurement adjustments |  |
| Change in fair value of equity securities | - |
| Ending balance - September 30, 2025 | $2571429 |

---

---

| | |
|:---|:---|
|  | **September 30, <br> 2025** |
|  | **Equity Securities** |
| Fair Value | $2571429 |
| Valuation technique | ASC 321 measurement alternative |
| Significant unobservable unit | Observable price changes in orderly transactions for the same or similar securities |

---

**Accounts Receivable and Allowance for Expected Credit Losses**

Accounts receivable consist of amounts due from veterinary customers. The Company records an allowance for current expected credit losses for estimated losses inherent in its trade accounts receivable portfolio. In establishing the required allowance, management considers historical losses adjusted for current market conditions, the financial condition of the customer, the amount of receivables in dispute, and the current receivables aging and payment patterns. The Company does not have any off-balance sheet credit exposure related to its customers. The allowance for current expected credit losses was $6,574 and $2,892 as of September 30, 2025 and December 31, 2024.

**Investments - Equity Securities**

The Company accounts for investments in accordance with ASC 321 – Equity Securities. The Company closed an investment of $2,571,429 in preferred series D shares of Stella Diagnostics, Inc. ("Stella"). The Company neither has control nor significant influence through investment in preferred shares. The Company accounted for the investment in Stella using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.

For the nine months ended September 30, 2025 and 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company's impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of September 30, 2025 and December 31, 2024, the Company did not recognize impairment against the investment security.

**Deferred Financing Costs**

Deferred financing costs represent third-party, incremental costs incurred in connection with the Purchase Agreement (defined in Note 15) the Company entered into. The Purchase Agreement was not effective as of September 30, 2025. Accordingly, the related deferred financing costs are presented as such on the condensed consolidated balance sheet. Reclassification of these deferred financing costs to additional paid-in capital will be recorded when the Purchase Agreement is effective.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**Stock-Based Compensation**

The stock-based payments are accounted for in accordance with the provisions of ASC 718, Compensation — Stock Compensation. The Company measures the estimated fair value of the stock-based award on the date of grant using the Black-Scholes-Merton option pricing model ("Black-Scholes Model") and recognizes compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award. The Black-Scholes Model requires the use of a number of assumptions including volatility of the stock price, the weighted average risk-free interest rate, and the vesting period in determining the fair value of stock-based awards. The expected term is based on the "simplified method", due to the Company's limited stock award history. Under this method, the term is estimated using the weighted average of the service vesting period and contractual term of the option award. As the Company's Class A common stock has a limited history in the public markets, the Company has identified several public entities of similar size, complexities and industry and calculates historical volatility based on the volatilities of these companies. Although the Company believes its assumptions used to calculate stock-based compensation expenses are reasonable, these assumptions can involve complex judgments about future events, which are open to interpretation and inherent uncertainty. In addition, significant changes to our assumptions could significantly impact the amount of expense recorded in a given period. The Company accounts for forfeitures in the period in which they occur, rather than estimate expected forfeitures.

**Basic and Diluted Net Loss Per Share**

Basic net loss per common share is computed by dividing net loss by the weighted-average number of common shares outstanding during each period. Diluted net loss per share of common shares includes the effect, if any, from the potential exercise or conversion of securities, such as convertible debt, share options and warrants, which would result in the issuance of incremental shares of common shares. For diluted net loss per share, the weighted-average number of common shares is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive. For all periods presented, basic and diluted net loss per share are the same, as any additional share equivalents would be anti-dilutive. As the Company has reported a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share.

The following outstanding potentially dilutive Common Shares equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive:

---

| | | |
|:---|:---|:---|
|  | **For the Period Ended** | **For the Period Ended** |
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| Warrants | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9834074 | &nbsp;&nbsp;&nbsp;&nbsp;1142 |
| Convertible notes payable | 507529 |  |
| Stock Options | 192061 | 4747 |
| Total | 10533664 | 5889 |

---

**Emerging Growth Company Status**

The Company is an Emerging Growth Company, as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these unaudited condensed consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**4.** **Property and equipment**

As of September 30, 2025, and December 31, 2024, property and equipment, net, consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| Land | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1482310 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1333810 |
| Buildings | 4439332 | 3951512 |
| Computers and equipment | 1636253 | 1403400 |
| Furniture and fixtures | 129204 | 129204 |
| Automobile | 80219 | 80219 |
| Leasehold improvements | 776418 | 713733 |
|  | 8543736 | 7611878 |
| Less - accumulated depreciation | (1653779) | (1229090) |
| Property and Equipment, net | $6889958 | $6382788 |

---

Depreciation expense for the three months ended September 30, 2025 and 2024 was $179,152 and $143,385, respectively. Depreciation expense for the nine months ended September 30, 2025 and 2024 was $405,466 and $423,896, respectively.

**5.** **Goodwill and Intangible Assets**

The following table shows the changes in the carrying amount of goodwill for the period:

---

| | |
|:---|:---|
| **Goodwill as of December 31, 2023** | 8147590 |
| Disposals | (125508) |
| **Goodwill as of December 31, 2024** | 8022082 |
| Acquisitions | 1066181 |
| **Goodwill as of September 30, 2025** | $9088263 |

---

There was no goodwill impairment recognized in the nine months ended September 30, 2025 and 2024.

The following summarizes the Company's intangible assets as of September 30, 2025 and December 31, 2024:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| Client List | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1916444 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1916444 |
| Noncompete Agreement | 398300 | 398300 |
| Trademark | 1047792 | 1047792 |
| Other Intangible Assets | 45836 | 45836 |
| Accumulated amortization | (2233273) | (1774445) |
|  | $1175099 | $1633927 |

---

Amortization expense was $151,346 and $196,782 for the three months ended September 30, 2025 and 2024, respectively, and $458,828 and $624,396 for the nine months ended September 30, 2025 and 2024, respectively.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

Expected future amortization expense of intangible assets as of September 30, 2025, is as follows:

---

| | |
|:---|:---|
| Remainder of 2025 | $149198 |
| 2026 | 575259 |
| 2027 | 368079 |
| 2028 | 82563 |
| 2029 |  |
| 2030 | - |
|  | $1175099 |

---

**6.** **Business disposal**

On September 20, 2024, the Company completed the divestiture of its Kauai Veterinary Clinic ("KVC") to Kauai RE Holdings LLC for $2.0 million, in notes payable assumed by the buyer, with no cash consideration. The agent for the sale was Gregory Armstrong, a current shareholder of the Company and a member of Kauai RE. Charles Keiser, DVM, is a member of Kauai RE and the father of our board member Charles Stith Keiser, who is the Company's largest shareholder through his entity Wilderness Trace Veterinary Partners, LLC. The divestiture resulted in a gain of $467,049 in fiscal year 2024, which was recorded in "Gain on sale of business" in the Statements of Operations. As a result of the transaction, the Company disposed of $125,508 of goodwill based on the relative fair value of KVC. The estimated fair value of KVC less estimated costs to sell exceeded it carrying amount as of the transaction date. As the sale of KVC was not considered a significant disposal or a strategic shift that would have a major effect on the Company's operations or financial results, it was not reported as discontinued operations.

**7.** **Debt**

**Master Lending and Credit Facility**

On June 25, 2021, the Company entered into a master line of credit loan agreement ("MLOCA") with Wealth South a division of Farmers National Bank of Danville, Kentucky ("FNBD"). The MLOCA provides for a $2,000,000 revolving secured credit facility ("Revolving Line") to be drawn for the initial purchase of veterinary clinical practices ("Practices") and a $8,000,000 closed end line of credit ("Closed End Line") to be disbursed as individual loans (Term Loans) to paydown draws on the Revolving Line and to provide longer term financing of the purchase of Practices. Each draw on the Revolving Line shall be repaid with a Term Loan out of the Closed End Line within one hundred and twenty (120) days of the draw on the Revolving Line. Each draw on the Revolving Line and the Closed End Line shall not exceed eighty-five (85%) percent of the purchase price of the Practice. The Company shall contribute and maintain equity of a minimum of fifteen (15%) percent of the initial purchase price of a Practice as long as any draw on the Revolving Line or a Term Loan remains unpaid with FNBD. The Revolving Line has an interest rate equal to the New York Prime Rate plus 0.50% that shall never be less than 3.57%. Each Term Loan issued under the Closed End Line shall have a fixed interest rate of 3.98% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest rate will equal to the New York Prime Rate plus 0.65% that shall never be less than 3.57%. Each Practice to be acquired must have a minimum projected debt-service coverage ratio ("DSCR") of 1.0x, defined as earnings before interest depreciation and amortization ("EBIDA")/Annual Debt Service Requirement.

Under the MLOCA the Term Loans to acquire a Practice shall not exceed 10 years. The first twelve months of the Term Loan may be interest only. Thereafter, the Loan will convert to an amortizing loan with monthly principal and interest payments. For Practice only Term Loans ("Practice Term Loans"), after the initial twelve-month interest only period, the balance will amortize over 9 years. For Loans made to purchase real property ("RE Term Loans"), after the initial twelve-month interest only period, the balance will amortize over a 19-year period.

There is no prepayment penalty on payments on the Revolving Line. The Term Loans are subject to a refinance fee of 2% of the then outstanding principal balance of the Term Loan if paid within two years of entering into the Term Loan and 1% of the then outstanding principal balance of the Term Loan if paid within three to five years of entering into the Term Loan. The refinance fee is due only if the Term Loan is paid off by refinancing. Borrowings under the MLOCA are guaranteed by Kimball Carr, CEO & President of the Company.

Effective August 18, 2022, the MLOCA was amended such that the interest rate charge on all sums advanced under the amended and restated MLOCA shall be 5.25% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest will be equal to the New York Prime Rate plus 0.65% that shall never be less than 4.75%. The MLOCA has been fully drawn against.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

Notes payable to FNBD as of September 30, 2025 and December 31, 2024 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **September 30,**<br>**2025** | **December 31,**<br>**2024** | **Issuance**<br>**Cost** |
| $237272 | CAH | 12/27/2021 | 12/27/2041 | 3.98% | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;212213 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;219975 | $6108 |
| 231987 | CAH | 12/27/2021 | 12/27/2031 | 3.98% | 168930 | 187461 | 6108 |
| 216750 | P&F | 12/27/2021 | 12/27/2041 | 3.98% | 193858 | 200949 | 5370 |
| 318750 | P&F | 12/27/2021 | 12/27/2031 | 3.98% | 232110 | 257571 | 5370 |
| 817135 | Pasco | 1/14/2022 | 1/14/2032 | 3.98% | 602050 | 667050 | 3085 |
| 478098 | Lytle | 3/15/2022 | 3/15/2032 | 3.98% | 362271 | 398275 | 1898 |
| 663000 | Lytle | 3/15/2022 | 3/15/2042 | 3.98% | 602050 | 621020 | 11875 |
| 425000 | Kern | 3/22/2022 | 3/22/2042 | 3.98% | 385929 | 398089 | 7855 |
| 1275000 | Kern | 3/22/2022 | 3/22/2032 | 3.98% | 966107 | 1062126 | 4688 |
| 246500 | Bartow | 5/18/2022 | 5/18/2042 | 3.98% | 224497 | 232428 | 5072 |
| 722500 | Bartow | 5/18/2022 | 5/18/2032 | 3.98% | 556980 | 613737 | 2754 |
| 382500 | Dietz | 6/15/2022 | 6/15/2032 | 3.98% | 298128 | 328026 | 1564 |
| 445981 | Aberdeen | 7/19/2022 | 7/29/2032 | 3.98% | 352980 | 386120 | 1786 |
| 1020000 | All Breed | 8/12/2022 | 8/12/2042 | 3.98% | 942476 | 971173 | 8702 |
| 519527 | All Breed | 8/12/2022 | 8/12/2032 | 3.98% | 415513 | 453984 | 3159 |
| 225923 | All Breed | 8/12/2022 | 8/12/2032 | 5.25% | 182828 | 198905 | 3159 |
| 637500 | Williamsburg | 12/8/2022 | 12/8/2032 | 5.25% | 536269 | 580834 | 2556 |
| 850000 | Valley Vet | 11/8/2023 | 11/8/2033 | 5.25% | 783340 | 843796 | 3315 |
| $9713423 |  |  |  |  | $8018482 | $8621519 | $84424 |

---

The Company amortized $1,560 and $1,560 of issuance costs in the aggregate during the three months ending September 30, 2025 and 2024, respectively. The Company amortized $4,629 and $4,646 of issuance cost in the aggregate during the nine months ending September 30, 2025 and 2024, respectively, for the FNBD notes payable.

**FSB Commercial Loans**

In January 2021, the Company entered into three separate commercial loans with First Southern National Bank ("FSB") as part of the KVC acquisition. The first commercial loan, in the amount of $1,105,000, had a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan had monthly payments of $6,903 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $13,264 that were capitalized and being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024, required the Company to make monthly payments of $9,016 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of KVC. Refer to "Business disposal" above for further detail.

The second commercial loan with FSB, in the amount of $1,278,400, had a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan had monthly payments of $13,157 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $10,085 that were capitalized and being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024, required the Company to make monthly payments of $14,898 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of KVC. Refer to "Business disposal" above for further detail.

The third commercial loan with FSB, in the amount of $450,000, had a fixed interest rate of 5.05% and a maturity date of September 11, 2021. The commercial loan was modified on August 25, 2021 to extend the maturity date to February 25, 2023 and increase the principal amount to $469,914. The fixed rate loan had monthly payments of $27,164 and was fully paid off on the maturity date. The commercial loan had issuance costs of $753 that were capitalized and being amortized straight line over the life of the loan. This loan was paid in full in February 2023.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

On October 31, 2022, the Company entered into three separate commercial loans with FSB as part of the Pony Express Practice acquisition. The first loan with FSB was in the amount of $2,086,921. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $23,138 except for a final monthly payment of $1,608,530. The commercial loan had issuance costs of $25,575 that were capitalized and are being amortized straight line over the life of the loan.

The second loan with FSB was in the amount of $400,000. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2042. The fixed rate loan has monthly payments of $2,859. The commercial loan had issuance costs of $3,277 that were capitalized and are being amortized straight line over the life of the loan.

The third loan with FSB was in the amount of $700,000. The loan has a fixed interest rate of 6.75% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $6,903 except for a final monthly payment of $423,278. The commercial loan did not have any issuance costs that were capitalized.

On December 16, 2022, the Company entered into two separate commercial loans with FSB as part of the Old 41 Practice acquisition. The first loan with FSB was in the amount of $568,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has monthly payments of $4,772 and a full payoff of the remaining principal balance at maturity. The loan had issuance costs of $4,531 that were capitalized and are being amortized straight line over the life of the loan.

The second loan with FSB was in the amount of $640,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has twelve monthly payments of approximately $2,830, followed by monthly payments of $7,443. and the interest rate is 6.50%. The loan had issuance costs of $5,077 that were capitalized and are being amortized straight line over the life of the loan.

On November 8, 2023, the Company entered into a commercial loan with FSB as part of the Valley Vet acquisition. The loan with FSB was in the amount of $375,000. The loan has a fixed rate of 8.5% and a maturity date of January 29, 2026. The fixed rate loan has monthly payments of $3,255, except one final payment of the outstanding principal balance on the note, including any accrued and unpaid interest. The loan had issuance costs of $6,877 that were capitalized and are being amortized straight line over the life of the loan.

The FSB commercial loans are guaranteed by Kimball Carr, Chief Executive Officer and President and Charles Stith Keiser, a member of our Board of Directors.

Notes payable to FSB as of September 30, 2025 and December 31, 2024 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **September 30,**<br>**2025** | **December 31,**<br>**2024** | **Issuance**<br>**Cost** |
| $1105000 | KVC | 1/25/2021 | 2/25/2041 | 4.35% | $- | $- | $13264 |
| 1278400 | KVC | 1/25/2021 | 1/25/2031 | 4.35% |  |  | 10085 |
| 469914 | KVC | 1/25/2021 | 2/25/2023 | 5.05% |  |  | 753 |
| 2086921 | Pony Express | 10/31/2022 | 10/31/2025 | 5.97% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1605591 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1733807 | 25575 |
| 400000 | Pony Express | 10/31/2022 | 10/31/2042 | 5.97% | 367827 | 375943 | 3277 |
| 700000 | Pony Express | 10/31/2022 | 8/16/2023 | 7.17% |  |  |  |
| 568000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 239320 | 470227 | 4531 |
| 640000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 384465 | 406641 | 5077 |
| 375000 | Valley Vet | 11/8/2023 | 1/29/2026 | 8.50% | 364470 | 375000 | 6877 |
| $7623235 |  |  |  |  | $2961673 | $3361618 | $69439 |

---

The Company amortized $2,995 and $5,146 of issuance cost in the aggregate during the three months ending September 30, 2025 and 2024, respectively. The Company amortized $8,886 and $15,325 of issuance cost in the aggregate during the nine months ending September 30, 2025 and 2024, respectively, for the FSB notes payable.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**Ushjo Commercial Loan**

On June 4, 2025, the Company entered into a commercial loan with Ushjo as part of the DeBary Animal Clinic acquisition. The loan with Ushjo was entered into on June 4, 2025, in the amount of $780,000. The loan has a fixed rate of 11.25% and a maturity date of July 1, 2026. The fixed rate loan has monthly payments for the interest portion of the loan, except one final payment of the outstanding principal balance on the note, including any accrued and unpaid interest.

Notes payable to Ushjo as of September 30, 2025 and December 31, 2024 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **September 30,**<br>**2025** | **December 31,**<br>**2024** | **Issuance**<br>**Cost** |
| $780000 | DeBary | 6/4/2025 | 7/1/2026 | 11.25% | $780000 | $- | $18810 |

---

The Company amortized $4,415 and $0 of issuance cost in the aggregate during the three months ending September 30, 2025 and 2024, respectively. The Company amortized $5,662 and $0 of issuance cost in the aggregate during the nine months ending September 30, 2025 and 2024, respectively, for the Ushjo notes payable.

Notes payable as of September 30, 2025, and December 31, 2024 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| FNBD Notes Payable | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8018480 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8621519 |
| FSB Notes Payable | 2961673 | 3361618 |
| Ushjo Note Payable | 780000 | - |
| Total notes payable | 11760153 | 11983137 |
| Unamortized debt issuance costs | (81146) | (81909) |
| Notes payable, net of issuance cost | 11679007 | 11901228 |
| Less current portion | (3424599) | (3410465) |
| Long-term portion | $8254408 | $8490763 |

---

Notes payable repayment requirements as of September 30, 2025, in the succeeding years are summarized as follows:

---

| | |
|:---|:---|
| Remainder of 2025 | $2435653 |
| 2026 | 1985045 |
| 2027 | 876805 |
| 2028 | 914210 |
| 2029 | 954785 |
| Thereafter | 4593655 |
| Total | $11760153 |

---

**Convertible Debenture**

Between March 18 and December 28, 2021, the Company issued $2,102,500 in aggregate principal amount of 6.00% subordinated convertible promissory notes ("Convertible Debenture"). During the year ended December 31, 2022, the Company issued $1,612,000 in aggregated principal amount of the Convertible Debenture. In March 2023 the Company issued an additional $650,000 in aggregate principal amount of Convertible Debenture to five (5) separate holders. The Convertible Debenture was convertible into the Company's Class A common stock upon the Company's offering for sale its shares in a initial public offering ("IPO"). At the holder's election, the accrued interest and principal could be paid in cash or Class A common stock (such number of shares reflecting a twenty-five percent (25%) discount to the opening price per share of Class A common stock). The Convertible Debenture matured 5 years from the date of issuance to each holder. Upon an IPO, the accrued and unpaid interest was due and payable in cash on the first business day of the following month for any balance not elected to be converted into the Class A common stock. The Convertible Debenture incurred issuance costs of $40,000 that were amortized straight line over the life of the Convertible Debenture. The Company amortized $0 of issuance cost during the three months ended September 30, 2025 and 2024. The Company amortized $0for the nine months ending September 30, 2025 and 2024.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

Upon the Company's IPO closing on August 31, 2023, the majority of Convertible Debenture holders elected to convert an aggregate of $4,014,500 of principal and $399,818 of accrued interest into 14,953 shares of Class A common stock at a conversion price of $30.00 per share. The Company recorded a beneficial conversion feature as of the date of the conversion of $1,569,395 based on the IPO price of $40 per share minus the principal and accrued interest of the Convertible Debenture balance converted into common stock. Four holders of the Convertible Debenture with an aggregate principal balance of $250,000 elected to be paid back in cash and one investor with a principal balance of $100,000 elected to be paid on February 28, 2024 including accrued interest through the date of payment at 6%. As of September 30, 2025, there is no principal amount of the Convertible Debenture outstanding.

**Loans Payable**

On May 30, 2023, the Company entered into a Merchant Cash Advance Agreement for gross proceeds of $1,050,000 with an unrelated third-party financial institution. Under the terms of the initial agreement, the Company had to pay $57,346 each week for 26 weeks with the first payment due June 6, 2023. The financing arrangement had an effective interest rate of 49%. The financing arrangement included an original issuance discount ("OID") of $441,000 and issuance costs of $50,000. The OID and issuance costs associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and are amortized using the effective interest method.

On August 10, 2023, the Company amended its financing arrangement to borrow an additional $507,460, increasing weekly repayments to $76,071 over 28 weeks. This amendment decreased the effective interest rate to 41%. The modification was evaluated under ASC 470-50 and determined to be a debt extinguishment. As a result, the Company recognized a loss on extinguishment of debt of $441,618, which was recorded in the statement of operations.

On November 28, 2023, the Company amended its financing arrangement to borrow an additional $531,071, decreasing weekly payments to $56,800 over 40 weeks. This amendment increased the effective interest rate to 49%. The modification was deemed a debt extinguishment, resulting in a loss on extinguishment of debt of $485,436, recorded in the statement of operations.

On January 18, 2024, the Company amended its financing arrangement to borrow an additional $549,185, increasing weekly payments to $86,214 over 43 weeks. This amendment increased the effective interest rate to 52%. The modification was accounted for as a debt extinguishment, and the Company recorded a loss on extinguishment of debt of $728,278 in the statement of operations.

On May 7, 2024, the Company amended its financing arrangement to borrow an additional $518,750, increasing weekly payments to $90,229 over 48 weeks. This amendment decreased the effective interest rate to 49%. The modification was treated as a debt extinguishment, resulting in a loss on extinguishment of debt of $859,584, recorded in the statement of operations.

On December 24, 2024, the Company amended its financing arrangement to borrow an additional $513,650, increasing weekly payments to $71,995 over 41 weeks. This amendment decreased the effective interest rate to 43%. The modification was determined to be a debt extinguishment, and the Company recognized a loss on extinguishment of debt of $546,356 in the statement of operations.

On May 20, 2025, the Company amended its financing arrangement to borrow an additional $550,000, increasing weekly payments to $78,500 over 47 weeks. This amendment decreased the effective interest rate to 42%. The modification was accounted for as a debt extinguishment, resulting in a loss on extinguishment of debt of $689,411, recorded in the statement of operations.

On April 4, 2024, the Company entered into a new financing agreement for gross proceeds of $420,000 with a different unrelated third-party financial institution. Under the terms of the agreement, the Company had to pay $21,600 each week for 28 weeks with the first payment due April 8, 2024. The financing arrangement had an effective interest rate of 51%. The financing arrangement included an original issuance discount ("OID") of $184,800 and issuance costs of $20,000. The OID and issuance costs associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and are amortized using the effective interest method. As of September 30, 2025, the financing arrangement has been paid in full, and the original issuance discount and issuance costs have been fully amortized.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

During the three and nine months ended September 30, 2025, the Company amortized $389,987 and $923,215 of OID and issuance cost, respectively. The amounts are included in interest expense on the statement of operations. During the three and nine months ended September 30, 2025, the Company made $942,000 and $2,774,400 in payments on the loan payable. The outstanding balance of the loan payable as of September 30, 2025 and December 31, 2024, were $2,057,740 and $2,340,020. The financing arrangement is secured by an interest in virtually all assets of the Company with a first security interest in accounts receivable. The financing arrangements are guaranteed by Kimball Carr, the Company's CEO.

**Convertible Notes Payable**

On March 26, 2024, Inspire entered into a securities purchase agreement with a certain investor, pursuant to which Inspire issued a convertible note payable for $500,000. The convertible note payable had a maturity date of the earlier of December 26, 2024 or the consummation of a capital raise. As of September 30, 2025, the financing arrangement has been paid in full.

On June 11, 2024, Inspire entered into a securities purchase agreement with two investors, pursuant to which Inspire issued each investor a convertible note payable") each for $250,000. The convertible notes payable have a maturity date of the earlier of February 11, 2025 or the consummation of a capital raise. As of September 30, 2025, the financing arrangement has been paid in full.

When outstanding the Convertible Notes Payable contain an original issued discount ("OID") which was: (i) fifteen percent (15%) if the Convertible Notes Payable were satisfied and paid in full on or before the forty-fifth (45th) day after the Original Issue Date (as such term was defined in the Notes), (ii) twenty percent (20%) if the Convertible Notes Payable were satisfied and paid in full after such 45th day but on or before the ninetieth (90th) day after the Original Issue Date, and (iii) thirty percent (30%) after such 90th day. The Convertible Notes Payable could be prepaid at any time prior to the Maturity Date without any penalties.

The Convertible Notes Payable had to be repaid in full from any future capital raises (debt, equity or any other form of capital raise) of Inspire. All of the funds raised had to be used to repay the Convertible Notes Payable until the Convertible Notes Payable were repaid in full.

The Convertible Notes Payable were convertible into shares of common stock of Inspire, in full or in part, at any time after issuance at the discretion of the noteholder at a fixed conversion price of $0.03 per share (the "Fixed Conversion Price").

If the Convertible Notes Payable were not repaid by the Maturity Date the default provisions were as follow: (i) The Face Value (as such term was defined in the Convertible Notes Payable) of the Convertible Notes Payable would increase by 20% (to a 50% OID -- $1,000,000 Face Value); (ii) the conversion price of the Convertible Notes Payable would become convertible at the lower of (a) the Fixed Conversion Price or (b) 20% discount to a 3-Day volume-weighted average price (the "Default Conversion Price").

On May 30, 2025, pursuant to securities purchase agreements, the Company issued Original Issue Discount Notes to two investors in the principal amounts of $204,700 and $92,000, respectively (the "Notes"). The Notes have a maturity date of March 30, 2026 and the proceeds are for general working capital. The Note to Diagonal Lending has a one-time interest payment of $24,564, and an initial payment of $114,632 due on November 30, 2025, with monthly payments of $28,658 due on the 30<sup>th</sup> of every month thereafter until March 30, 2026. The Note to Boot Capital has a one-time interest payment of $11,040, and an initial payment of $51,520 due on November 30, 2025, with monthly payments of $12,880 due on the 30<sup>th</sup> of every month thereafter until March 30, 2026.

The Company has the right to prepay the Notes upon written notice to the lender. After an occurrence of an event of default, as described in the Notes, the Notes shall become immediately due and payable and the Company will pay an amount equal to 150% times the sum of (i) the then outstanding principal amount of the Notes plus (ii) accrued and unpaid interest on the unpaid principal amount, plus (iii) default interest, if any.

The lenders will have the right to convert all or any part of the outstanding and unpaid amount of their Note into shares of the Company's common stock upon the later of 180 days from the issuance date or an event of default, as described in the notes. The conversion price of the Notes is 75% of the market price.

While the Notes remain outstanding, the Company may not, without the lenders' written consent, sell, lease, or otherwise dispose of any significant portion of its assets except in the ordinary course of business.

As of September 30, 2025 the balance of the Convertible Notes Payable was $274,908. During the year ended December 31, 2024 the Company paid off $392,857 of the notes payable and accrued interest and converted $1,357,143 into 226,249 shares of class A common stock.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**Promissory Note**

On June 10, 2025, the Company issued to Target Capital LLC ("Target") a promissory note in the principal amount of $625,000, with an original issue discount of $125,000 such that the purchase price was $500,000 (the "Target Note").

The Target Note shall not exceed the maximum amount of such interest permitted by law to be charged and a maturity date of the earlier of (i) six months from the issuance date, or (ii) the close of any capital raise conducted by the Company. The proceeds from the Target Note are for general working capital.

The Company has the right to prepay the Target Note at any time prior to the maturity date without penalty. In the event of the closing of any capital raise conducted by the Company, no less than 50% of the net proceeds shall be used to repay the Target Note, until the Target Note is paid in full.

After an occurrence of an event of default, as described in the Target Note, it shall become immediately due and payable and the original issue discount shall increase from 20% to 40%.

On June 30, 2025, the Company issued to Target a second promissory note in the principal amount of $625,000, with an original issue discount of $125,000 such that the purchase price was $500,000 (the "Second Target Note").

The Second Target Note has identical terms and provisions to the original Target Note.

**8.** **Related Party Transactions**

**Blue Heron**

The Company's director, Charles Stith Keiser, is the Chief Operating Officer of Blue Heron Consulting ("BHC"), and Mr. Keiser's father, Dr. Charles "Chuck" Keiser, is the Chief Visionary Officer of BHC. During the three months ended September 30, 2025 and 2024 the Company has incurred $35,000 and $0 in expenses for, respectively. The Company has incurred $94,043 and $83,168 in expenses for the nine months ended September 30, 2025 and 2024, respectively. These expenses are recorded as a component of "General and administrative expenses" in the accompanying condensed consolidated statement of operations.

**Sale of KVC**

On September 20, 2024, the Company sold KVC to Kauai RE Holdings LLC. The agent for the sale was Gregory Armstrong, a current shareholder of the Company and a member of Kauai RE. Charles Keiser, DVM, is a member of Kauai RE and the father of our board member Charles Stith Keiser, who is the Company's largest shareholder through his entity Wilderness Trace Veterinary Partners, LLC, refer to Note 6 Business disposal for further detail.

**9.** **Stockholders' Equity**

The Company is authorized to issue 170,000,000 shares, of which 100,000,000 shares are designated as Class A common stock, with a par value of $0.0001 per share (the "Class A Common Stock"), 20,000,000 shares are designated as Class B common stock, with a par value of $0.0001 per share (the "Class B Common Stock"), and 50,000,000 shares are designated as Preferred Stock, with a par value of $0.0001 per share (the "Preferred Stock").

Each outstanding share of Class A common stock is entitled to vote on each matter on which the stockholders of the Company is entitled to vote, and each holder of Class A common stock is entitled to one (1) vote for each share of Class A common stock held by such holder.

Each outstanding share of Class B common stock is entitled to vote on each matter on which the stockholders of the Company is entitled to vote, and each holder of Class B common stock is entitled to twenty-five (25) votes for each share of Class B common stock held by such holder. Each Class B common stock is convertible to 1/100<sup>th</sup> of 1 share of Class A common stock.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

All shares of Class A common stock and Class B common stock (collectively "common stock") will be identical and will entitle the holders thereof to the same rights and privileges, except as otherwise provided above.

**Convertible Series A Preferred Stock**

On June 30, 2023, the Company amended its articles of incorporation by the filing of a certificate of designation for the Series A Preferred Stock. One million shares of the Series A Preferred Stock are authorized under the Series A Certificate of Designation, with each having a stated value of $10.00 per share, with a par value of $0.0001. The Series A Preferred Stock earns a dividend rate equal to 12% of the stated rate per annum, which such dividend may be payable either in cash or in-kind at the sole option of the Company.

Holders of shares of the Series A Preferred Stock are entitled to a liquidation preference in the event of any dissolution, liquidation or winding up of the Company equal to the stated value plus any accrued and unpaid dividends on such stock. Holders of shares of Series A Preferred Stock are also entitled to convert such shares at any time and from time, at the option of such holder, into a number of shares of Class A common stock equal to the stated value divided by a conversion price. The conversion price is equal to 60% of the dollar volume-weighted average price for shares for the Company's Class A common stock for the three trading days immediately preceding the date of the conversion. However, the conversion price can never be less than 50% of the per-share price for shares of Class A common stock during the Company's initial public offering. For any conversion during the Company's initial three days of market trading, the conversion price will be equal to 60% of the price for the Company's underwritten initial public offering.

On October 2023, the Company amended its article of incorporation to increase the total number of shares of preferred stock designated as Series A preferred stock to 2,000,000 shares.

The conversion price of the convertible series A preferred stock to be no less than $1.00 per share, as adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction conducted after the date of the series A preferred stock amendment.

The holders of the Series A Preferred Stock have the right to vote on all matters submitted to a vote of shareholders on an as-if-converted basis together with the holders of shares of the Company's Class A and Class B common stock, voting together as a single class.

On June 30, 2023, the Company issued 442 shares of Series A Preferred Stock to the holders of the Bridge Notes in exchange for the Bridge Notes (the "Exchange").

In connection with the Exchange, the Company also issued warrants (the "New Warrants") to purchase additional shares of Class A common stock. The New Warrants were issued in exchange for the existing warrants held by the former Bridge Note holders. The exercise price of the shares to be issued pursuant to the New Warrants is $10,000 per share. The number of shares to be issued upon exercise of the New Warrants is equal to the quotient of 75% of the outstanding Series A Preferred Stock value divided by the exercise price, amounting to 332 shares. Also, in connection with the Exchange, the Company entered into new registration rights agreements (the "New Registration Rights Agreements") with each of holders, pursuant to which the Company has agreed to register the public resale of the shares of Class A common stock issuable upon conversion of the Series A Preferred Stock and upon exercise of the under the New Warrants. The New Registration Rights Agreements supersede in their entirety the prior registration rights agreements with the former senior secured lenders. If Company did not close the initial public offering on or before September 1, 2023, the Exchange Agreements would have been deemed rescinded, and the former Bridge Notes would have been deemed reinstated. As the offering was outside the control of the Company the Company did not recognize the full extinguishment of the Bridge Notes until the IPO was completed on August 31, 2023. The Company recognized a beneficial conversion feature of $2,567,866 for the issuance of the Series A Preferred Stock on the date of the IPO due to the $4 (pre-Reverse Split) offering price related to the IPO being known as of that date.

As of September 30, 2025 and December 31, 2024, there were no shares of Series A Preferred Stock outstanding, respectively.

**Convertible Series B Preferred Stock**

On July 28, 2025, the Company, entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") with certain accredited investors named therein. Pursuant to the Securities Purchase Agreement, up to 7,590 shares of the Company's Series B convertible preferred stock, par value $0.0001 per share (the "Series B Preferred Stock" or "Preferred Stock") and accompanying warrants ("Warrants") to purchase shares of the Company's common stock, par value $0.0001 per share (the "Common Stock") may be purchased for an aggregate purchase price of up to $10 million in one or more closings (each a "Closing").

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

On July 29, 2025, pursuant to the Securities Purchase Agreement, the Company issued and sold, and certain investors purchased, in a private placement (the "Private Placement"): 6,340 shares of the Series B Preferred Stock and 6,340,000 Warrants to purchase shares of Common Stock for aggregate proceeds of approximately $5 million, paid in cash and through the transfer of 514,286 shares of Stella Diagnostics Series D Preferred Stock, in lieu of cash. The shares were initially recognized at the negotiated transaction price of $5.00 per share (totaling $2.57 million), which represented the most reliably determinable fair value at the acquisition date and reflected on the unaudited condensed consolidated balance sheet as investment – equity securities. On September 9, 2025, the Company completed an additional closing, issuing 1,253 shares of Series B preferred stock and 1,252,500 warrants for aggregate proceeds of approximately $1 million.

The Warrants expire on the fifth anniversary of their initial exercisability date and have an initial exercise price of $1.00, subject to adjustment as set forth therein. The exercise price of the Warrants will be subject to adjustment upon lower priced securities issuances, or upon certain triggering events which consist of specific types of default under the terms of the transaction documents. In no event can the conversion and exercise price go below $0.1879, subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations and similar events.

Each holder of Series B Preferred Stock may convert all, or any part, of the outstanding Series B Preferred Stock, at any time at such holder's option, into shares of the Common Stock (which converted shares of Common Stock are referred to as "Conversion Shares" herein) at the fixed "Conversion Price" of $1.00 which is subject to proportional adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions.

The holders of the Series B Preferred Stock shall have no voting power and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock, except as provided in the Certificate of Designations (or as otherwise required by applicable law).

As of September 30, 2025 and December 31, 2024, there were 7,593 and 0 shares of Series B Preferred Stock outstanding, respectively.

**Nasdaq Compliance**

The Company had received a notice letter from Nasdaq on April 10, 2025 stating that, based on stockholders' equity as reported in the Annual Report on Form 10-K for the fiscal year ended December 31, 2024, the Company was not in compliance with the minimum stockholders' equity requirement for continued inclusion on the Nasdaq Capital Market. On August 26, 2025, following the first closing of a private placement of Series B convertible preferred stock, which is discussed above, Nasdaq notified the Company that it determined that the Company complies with Nasdaq's minimum stockholders' equity requirement.

**Common Stock & Pre-Funded Warrants**

On March 25, 2025, the Company entered into a securities purchase agreement with an institutional investor, pursuant to which the Company agreed to issue and sell to the investor in a registered direct offering (the "Offering") 207,896 shares of Class A common stock, pre-funded warrants to purchase up to 885,000 shares of Class A common stock, five-year warrants (the "Series A Warrants") to purchase up to 1,092,896 shares of Class A common stock and eighteen-month warrants (the "Series B Warrants" and, together with the Series A Warrants, the "Common Warrants") to purchase up to 1,092,896 shares of Class A common stock. Gross proceeds from the Offering, before deducting the placement agent's fees and other offering expenses, were $2,000,000. Each Common Warrant has an exercise price per share of $1.83 and was exercisable beginning on June 11, 2025.

**Crone Consulting Agreement** 

On June 30, 2025, the Company entered into a consulting agreement with Mark Crone. As consideration for legal consulting services, the Company issued 200,000 shares of common stock to Mr. Crone pursuant to the Company's 2022 Equity Incentive Plan. The agreement may be terminated by either party at any time and for any reason and also contains standard confidentiality clauses. The shares were issued on July 30, 2025 pursuant to this agreement. For the three and nine months ended September 30, 2025, the Company recorded $164,000 in consulting fees related to this agreement.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**Alchemy Consulting Agreement**

On July 2, 2025, the Company entered into a consulting agreement with Alchemy Advisory, LLC ("Alchemy"). As consideration for consulting services, the Company issued 350,000 shares of common stock to Alchemy pursuant to the Company's 2022 Equity Incentive Plan. The agreement may be terminated by either party at any time and for any reason and also contains standard confidentiality clauses. The shares were issued on July 2, 2025 pursuant to this agreement. For the three and nine months ended September 30, 2025, the Company recorded $236,000 in consulting fees related to this agreement.

**10.** **Stock Compensation**

Effective October 18, 2022, the Board of Directors of Inspire Veterinary Partners adopted the 2022 Equity Incentive Plan, (the "2022 Plan"). The plan provides for the award of stock options (incentive and non-qualified), stock awards and stock appreciation rights to officers, directors, employees and consultants who provide services to the Company. The number of shares issued may not exceed, at any given time, ten percent (10%) of the total of: (a) the issued and outstanding shares of the Company's common stock, and (b) all shares of common stock issuable upon conversion or exercise of any outstanding securities of the Company which are convertible or exercisable into shares of common stock. The 2022 Plan expires on October 18, 2032.

The Company recognizes stock-based compensation expense from stock-based payments using the grant date fair-value, including for stock options. The fair value of options awarded to employees is measured on the grant date using the Black-Scholes option-pricing model and is recognized as an expense over the requisite service period on a straight-line basis.

All stock options are exercisable into class A common stock.

There were 0 and 185,320 stock options granted und ender the 2022 Plan to the Company's employees and directors during the three and nine months ended September 30, 2025, and no stock options granted for three and nine months ended September 30, 2024.

The stock options granted during nine months ended September 30, 2025, were valued utilizing the Black-Scholes options pricing model with the following inputs: $1.46 - $1.71 of stock price, 3.95% -4.06% risk-free rate, 47.33% - 49.19% volatility, 0% dividend rate, and the expected term of 5.00 years.

The following is a summary of outstanding stock options as of September 30, 2025 and December 31, 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of Shares** | **Weighted Average Exercise<br> Price** | **Weighted Average Remaining Life (years)** | **Aggregate Intrinsic<br> Value** |
| **Options outstanding as of December 31, 2023** | **-** | $**-** | **-** | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;Issued | 9459 | 33.88 | 10.00 |  |
| &nbsp;&nbsp;&nbsp;Expired and forfeited |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | - | - | - | - |
| **Options outstanding as of December 31, 2024** | **9459** | $**33.88** | **9.74** | $**-** |
| **Options exercisable as of December 31, 2024** | **9459** | $**33.88** | **9.74** | $- |
| &nbsp;&nbsp;&nbsp;Issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Expired and forfeited |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | - | - | - | - |
| **Options outstanding as of March 31, 2025** | **9459** | $**33.88** | **9.50** | $**-** |
| **Options exercisable as of March 31, 2025** | **9459** | $**33.88** | **9.50** | $- |
| &nbsp;&nbsp;&nbsp;Issued | 185320 | 1.62 | 10.00 |  |
| &nbsp;&nbsp;&nbsp;Expired and forfeited | (2718) |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | - | - | - | - |
| **Options outstanding as of June 30, 2025** | **192061** | $**2.75** | **9.83** | $**-** |
| **Options exercisable as of June 30, 2025** | **192061** | $**2.75** | **9.83** | $**-** |
| &nbsp;&nbsp;&nbsp;Issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Expired and forfeited |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | - | - | - | - |
| &nbsp;&nbsp;&nbsp;**Options outstanding as of September 30, 2025** | **192061** | $**2.75** | **9.58** | $**-** |
| **Options exercisable as of September 30, 2025** | **192061** | $**2.75** | **9.58** | $**-** |

---

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

The following is the vesting terms associated with those shares for the nine months ended September 30, 2025:

---

| | | | |
|:---|:---|:---|:---|
| **Tranche** | **Shares<br> Granted** | **Vesting <br> Method** | **Vesting Terms** |
| Tranche 1 | 192061 | Immediate | The vesting date is immediate and is fully vested on the grant date |
| Total | 192061 |  |  |

---

**11.** **Warrants**

As of September 30, 2025, outstanding Common Share warrants and exercise prices related to unit offerings are as follows:

---

| | | |
|:---|:---|:---|
| **Exercise Price** | **Number of Shares** | **Expiry Date** |
| $6000.00 | 20 | January 2028 |
| 11000.00 | 32 | August 2030 |
| 233.75 | 753 | August 2028 |
| 10000.00 | 332 | June 2028 |
| 1.83 | 1092896 | March 2030 |
| 1.83 | 1092896 | November 2026 |
| 1.00 | 7592500 | September 2030 |
| 2.29 | 1844 | March 2030 |
| 2.29 | 547 | March 2030 |
| 2.29 | 35041 | March 2030 |
| 2.29 | 17213 | March 2030 |

---

During the periods ended September 30, 2025 and December 31, 2024, 969,429 and 21,780 pre-funded warrants were exercised, respectively..

**12.** **Retirement Plan**

During the year ending December 31, 2022, the Company implemented a qualified 401(K) retirement plan. The Company offers eligible domestic full-time employees participation in certain 401K plans. The plans provide for a discretionary annual company contribution. In addition, employees may contribute a portion of their salary to the plans, which for certain of the 401K plans, is partially matched by the Company. The plans may be amended or terminated at any time. The Company contributed and expensed $32,643 and $34,118 during the three months ending September 30, 2025 and 2024, respectively. The Company contributed and expensed $94,413 and $115,771 during the nine months ending September 30, 2025 and 2024, respectively.

**13.** **Income Taxes**

The Company has incurred losses since inception, which have generated net operating loss ("NOL") carryforwards. As of September 30, 2025 and December 31, 2024, no tax benefit was reported with respect to these NOL carry-forwards in the accompanying financial statements because the Company believes the realization of the Company's net deferred tax assets for the NOL for combined federal and state jurisdictions was considered more likely than not that it will not be realized and accordingly, the potential tax benefits of the net loss carry-forwards are fully offset by a full valuation allowance. The Company's effective tax rate is different than the federal statutory tax rate because the Company has established a full valuation allowance against its net deferred income tax asset.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**14.** **Leases**

 

The Company determines if an arrangement is a lease at inception. Operating leases are included in right-of-use assets ("ROU"), operating lease liabilities, and operating lease liabilities, non-current. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. None of the leases entered into have an implicit rate, the Company uses its incremental borrowing rate based on the information available at lease commencement date in determining the present value of future payments. Incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. The ROU assets also include any prepaid lease payments made and initial direct costs incurred and exclude lease incentives. The Company's lease terms may include options to extend or terminate the lease, which is recognized when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet.

The Company has operating leases for real estate. The Company has certain intercompany leases between its subsidiaries, and these transactions and balances have been eliminated in consolidation and are not reflected in the tables and information presented below.

The components of lease expense included in the Company's unaudited condensed statements of operations were as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **For the three months ended<br> September 30,** | **For the three months ended<br> September 30,** | **For the nine months ended<br> September 30,** | **For the nine months ended<br> September 30,** |
|  | **Expense**<br>**Classification** | **2025** | **2024** | **2025** | **2024** |
| **Operating lease expense:** |  |  |  |  |  |
| Amortization of ROU asset | &nbsp;&nbsp;General and administrative | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;53417 | $50978 | $172405 | $154525 |
| Accretion of Operating lease liability | &nbsp;&nbsp;General and administrative | 13574 | 11460 | 39061 | 36453 |
| &nbsp;&nbsp;&nbsp;Total operating lease expense |  | $66991 | $62438 | $211466 | $190978 |
| Other lease expense | &nbsp;&nbsp;General and administrative | 7423 | 20887 | 40279 | 27689 |
| &nbsp;&nbsp;&nbsp;Total |  | $74414 | $83325 | $251745 | $218667 |

---

Other information related to leases is as follows:

---

| | | |
|:---|:---|:---|
|  | **As of <br> September 30,**<br>**2025** | **As of <br> December 31,**<br>**2024** |
| Remaining lease term: |  |  |
| &nbsp;&nbsp;&nbsp;Operating leases (in years) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.14 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.77 |
| Discount rate: |  |  |
| &nbsp;&nbsp;&nbsp;Operating leases | 7.24% | 7.25% |

---

Amounts relating to leases were presented on the unaudited condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024 in the following line items:

---

| | | | |
|:---|:---|:---|:---|
|  | <br>**Balance Sheet Classification** | **As of <br> September 30,**<br>**2025** | **As of<br> December 31,**<br>**2024** |
| **Assets:** |  |  |  |
| Operating lease assets | &nbsp;&nbsp;Right-of-use assets | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1695171 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1879729 |
| **Liabilities:** |  |  |  |
| Operating lease liabilities | &nbsp;&nbsp;Operating lease liabilities | 170774 | 183981 |
| Operating lease liabilities | &nbsp;&nbsp;Operating lease liabilities, non-current | 1813828 | 1943487 |
| Total lease liabilities |  | $1984602 | $2127468 |

---

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

The future minimum lease payments required under leases as of September 30, 2025, were as follows:

---

| | |
|:---|:---|
| **Fiscal Year** | **Operating<br> Leases** |
| Remainder of 2025 | $77319 |
| 2026 | 312299 |
| 2027 | 316369 |
| 2028 | 323311 |
| 2029 | 336045 |
| Thereafter | 1332102 |
| &nbsp;&nbsp;&nbsp;Undiscounted cash flows | 2697445 |
| Less: imputed interest | (712843) |
| &nbsp;&nbsp;&nbsp;Lease liability | $1984602 |

---

**15.** **Commitments and Contingencies**

As of September 30, 2025, substantially all of the Company's assets were pledged as collateral for the Company's credit facilities.

On November 30, 2023, the Company entered into a common stock purchase agreement with a 3<sup>rd</sup> party investor (the "Investor"), to which the investor committed to purchase up to $30 million of the Company's Class A common stock.

Under the terms and subject to the conditions of the Purchase Agreement, the Company has the right, but not the obligation, to sell to the Investor, and the Investor is obligated to purchase, shares of Class A common stock in an amount up to $30 million. Such sales of Class A common stock by the Company, if any, will be subject to certain limitations, and may occur from time-to-time in the Company's sole discretion, over the period commencing once certain customary conditions are satisfied, including the filing and effectiveness of a resale registration statement with the U.S. Securities and Exchange Commission (the "Commission") with respect to the shares to be sold to the Investor under the Purchase Agreement and ending on the first day of the month following the 24-month anniversary of the date on which the resale registration statement is declared effective by the Commission. The Investor has no right to require the Company to sell any shares of Class A common stock to the Investor, but the Investor is obligated to purchase shares of Class A common stock pursuant to a valid purchase notice delivered by the Company, subject to certain conditions and limitations.

Purchase Price

The shares of Class A common stock to be issued by the Company and purchased by the Investor will be sold at a purchase price equal to 95% of the lowest daily volume-weighted average price of the Class A common stock on the Nasdaq Capital Market (or any eligible substitute exchange) during the three consecutive trading days immediately following the trading date on which a valid purchase notice is delivered to the Investor by the Company. Such purchase price will be adjusted for reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction by the Company with respect to its Class A common stock.

Actual sales of shares of Class A common stock to the Investor will depend on a variety of factors to be determined by the Company from time-to-time, including, among other things, market conditions, the trading price of the Company's Class A common stock, and the working capital needs, if any, of the Company.

The net proceeds from sales, if any, under the Purchase Agreement to the Company will depend on the frequency and prices at which the Company sells shares of Class A common stock to the Investor. the Company expects that any proceeds received by the Company from such sales to the Investor will be used for working capital and general corporate purposes.

Purchase Limits

Pursuant to the Purchase Agreement, the Company may not require the Investor to purchase, and the Investor will have no obligation to purchase, shares of Class A common stock in excess of a number equal to the lowest of (i) 100% of the average daily trading volume of the Class A common stock on the Nasdaq Capital Market (or any other eligible national stock exchange, as applicable) for the five consecutive trading days immediately prior to the trading date on which a valid purchase notice is delivered to the Investor, (ii) a 30% discount to the daily trading volume in the Class A common stock on the Nasdaq Capital Market (or any other eligible national stock exchange, as applicable), and (iii) $2 million divided by the volume-weighted average price for the Class A common stock on the trading day immediately prior to the trading date on which a valid purchase notice is delivered to the Investor.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

Consistent with certain applicable Nasdaq rules, the Company may not issue to the Investor more than 12,143 shares of its Class A common stock (the "Exchange Cap") under the Purchase Agreement, which number of shares is equal to 19.99% of the shares of the Company's Class A common stock issued and outstanding immediately prior to the execution of the Purchase Agreement, unless the Company obtains stockholder approval to issue shares of its Class A common stock in excess of such limit in accordance with applicable rules of Nasdaq or any other applicable national stock exchange.

Fees

As consideration for the Investor's irrevocable commitment to purchase shares of Class A Common Stock, upon execution of the Purchase Agreement, the Company became obligated to issue to the Investor a number of shares of Class A Common Stock equal to $600,000 divided by the average daily volume-weighted average price for the Class A Common Stock on the Nasdaq Capital Market during the five consecutive trading days ending on the trading date immediately prior to the Company's filing of an initial registration statement pursuant to the Registration Rights Agreement described below. In certain circumstances, the Company may become obligated to pay to the Investor a cash fee equal to $600,000 in lieu of issuing such shares of Class A Common Stock, under the terms and subject to the conditions described more fully in the Purchase Agreement.

Certain Representations, Warranties and Covenants

The Purchase Agreement contains customary representations, warranties, conditions, and indemnification obligations of each of the Company and the Investor. Pursuant to the Purchase Agreement, the Investor has agreed not to enter into or effect, in any manner whatsoever, directly or indirectly, any short sales of the Company's Class A Common Stock or hedging transaction which establishes a net short position with respect to the Class A Common Stock. In addition, the Company has covenanted, among other things, through the 24-month anniversary of the signing of the Purchase Agreement, to not effect or enter into any agreement to issue any shares of Class A Common Stock or securities convertible into or exercisable or exchangeable into shares of Class A Common Stock except in limited circumstances.

The Company has the right to terminate the Purchase Agreement at any time following the satisfaction of certain conditions precedent relating to the initial sale of shares to the Investor, subject to the Company paying all documented fees and amounts to the Investor's legal counsel and, if the agreement is terminated prior to effectiveness of the resale registration statement, the Company paying the $600,000 cash commitment fee to the Investor or, if the agreement is terminated after such effectiveness, the Company issuing all commitment shares of Class A Common Stock to the Investor.

The Purchase Agreement will automatically terminate on (i) the 24-month anniversary of the effective date of the initial resale registration statement filed with the Commission, (ii) the date when the Investor purchases its total commitment, (iii) the date when the shares of Class A Common Stock are no longer listed on the Nasdaq Capital Market or another eligible national stock exchange, or (iv) when the Company is subject to a voluntary or involuntary bankruptcy or insolvency proceeding.

In addition, the Investor may terminate the Purchase Agreement upon (i) the occurrence of an event constituting a material adverse effect (as defined in the Purchase Agreement), (ii) the occurrence of a change of control transaction of the Company, (iii) the failure by the Company to file a registration statement by the applicable deadline set forth in the Registration Rights Agreement, (iv) the lapse of the effectiveness, or unavailability of, a registration statement filed by the Company pursuant to the Registration Rights Agreement in certain other circumstances set forth in the Purchase Agreement, (v) the suspension of trading of the Class A Common Stock for a period of three (3) consecutive trading days, or (vi) the material breach of the Purchase Agreement by the Company, which breach is not cured within the 10 trading days after receipt of notice of such breach.

On December 28, 2023, the Company amended the agreement to provide that, if the number of commitment shares required to be issued by the Company to the Investor and its affiliates (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3 promulgated thereunder) pursuant to the Purchase Agreement would result in the beneficial ownership by the Investor of more than 4.99% of the outstanding shares of Class A common stock of the Company, then the Company shall be obligated to deliver to the Investor: (i) the number of shares of Class A common stock that, after giving effect to the issuance thereof to the Investor, would result in the Investor and its affiliates beneficially owning one (1) share less than 4.99% of the outstanding shares of Class A common stock of the Company, and (ii) a warrant to purchase shares of Class A common stock (such warrant, the "Warrant" and the shares issuable upon exercise thereof, the "Warrant Shares"), granting the Investor the right to purchase, at an exercise price of $0.01 per Warrant Share, up to that number of Warrant Shares equal to the difference between (x) the number of shares that would be required to be issued to the Investor as commitment shares but-for the 4.99% ownership limitation, and (y) the number of shares of Class A common stock to be issued to the Investor as commitment shares.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

The amendment further provided that, if the issuance of the total number of commitment shares of Class A common stock and Warrant Shares by the Company to the Investor would cause the beneficial ownership of the Investor and its affiliates to exceed 19.99% of the outstanding shares of Class A common stock of the Company, and the Company has not obtained stockholder approval for the issuance of such shares of Class A common stock in an amount in excess of the 19.99% ownership threshold in accordance with the applicable rules of The Nasdaq Capital Market on or before May 24, 2024, then the Company shall be obligated to pay to the Investor an amount in cash equal to $600,000 minus the value of the shares of Class A common stock issuable to the Investor as commitment shares and the value of the Warrant Shares issuable upon exercise of the Warrant. Stockholder approval was obtained in March 2024.

On February 14, 2024, the Company issued 12,143 shares of Class A Common stock, per share to an Investor. In addition, the Company, on February 13, 2024, issued a prefunded warrant to purchase up to 16,549 shares of Class A common stock of the Company to the Investor. The Company issued the shares and the warrant in fulfilment to its obligation to issue "commitment shares" to the Investor upon its entry into the purchase agreement. The Company issued the shares and warrant to the Investor exempt from registration pursuant to Rule 506(b) of Regulation D under the Securities Act of 1933. The Company did not receive any proceeds with respect to the issuance of the Commitment Shares or the Warrant and does not expect to receive any material proceeds from the Investor's exercise, if any, of Warrant for the purchase of Warrant shares.

The Company is no longer selling shares under this agreement and no shares were sold by the Company to the Investor during the quarter ended September 30, 2025.

**Common Stock Purchase Agreement**

On July 29, 2025, Inspire entered into a Common Stock Purchase Agreement (the "Purchase Agreement") with Seven Knots, LLC ("Seven Knots"), pursuant to which Seven Knots committed to purchase, subject to certain conditions and limitations, up to $50 million of shares of the Company's Class A common stock.

Under the terms of the Purchase Agreement, the Company may, at its sole discretion, direct Seven Knots to purchase shares of common stock in amounts not to exceed $5 million per purchase notice, provided that the closing sale price of the common stock is at least $0.75 per share and other customary conditions are satisfied. Seven Knots's ownership is limited to 4.99% of the Company's outstanding common stock.

For the quarter ended September 30, 2025, the Company did not issue or sell any shares of the Company's Class A common stock under the Purchase Agreement.

**Holdback Agreements**

As part of the Valley Veterinary Services, Inc. ("Valley Vet") acquisition in November 2023, a portion of the purchase price in the amount of $200,000 was classified as restricted cash in the accompanying unaudited condensed consolidated balance sheet. The Holdback Agreement dictates that $80,000 is contingent upon both former owners (now employees of the Company) still being employed by the Company as of November 8, 2024 and the Valley Vet Practice's gross revenue exceeding 105% of the target gross revenue. The remaining $120,000 is contingent upon both former owners (now employees of the Company) still being employed by the Company as of November 8, 2025 and the Valley Vet Practice's gross revenue exceeding 110% of the target gross revenue.

The Company determined that the first milestone of the Holdback Agreement had been met, as the Valley Vet Practice's gross revenue exceeded 105% of the target and both former owners remained employed. As a result, the Company released and paid out the $80,000 holdback amount in accordance with the agreement in January 2025. The remaining holdback amount of $120,000 is classified as restricted cash in the accompanying unaudited condensed balance sheet as of September 30, 2025.

As part of the DeBary Animal Clinic acquisition in June 2025, a portion of the purchase price in the amount of $114,500 was classified as restricted cash in the accompanying unaudited condensed consolidated balance sheet. The Holdback Agreement dictates that $40,000 is contingent upon former owner (now employee of the Company) still being employed by the Company as of June 3, 2026 and the DeBary Animal Clinic's gross revenue exceeding 105% of the target gross revenue. The remaining $74,500 is contingent upon both former owners (now employees of the Company) still being employed by the Company as of June 3, 2027 and the DeBary Animal Clinic's gross revenue exceeding 110% of the target gross revenue.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**16.** **Business Acquisition**

**<u>Acquisition of Debary Animal Clinic</u>** 

On June 4, 2025, the Company and IVP FL Holding Company LLC, a wholly-owned subsidiary, entered into an asset purchase agreement with Joseph A. Suarez, DVM (the "Seller Parties") to acquire substantially all of the assets of Debary Animal Clinic, a veterinary clinic. At the Closing, the Seller Parties delivered a duly executed assignment of the acquired assets, thereby selling, assigning, and transferring to the Company all rights, title, and interest in the assets of the practice.

The aggregate consideration paid by the Company for the acquisition of the business and real estate was approximately $1,942,500, consisting of: (a) $1,850,000 in cash and (b) $92,500 in restricted shares of the Company's Class A common stock, calculated based on the closing price of the Company's stock on the Nasdaq Capital Market on the trading day immediately prior to the Closing Date. In addition, the acquisition agreement includes a holdback arrangement for $114,500 in cash, which may be paid to the Sellers at the end of the first and second years following the acquisition, contingent upon the continued employment of the former owners and the achievement of specified revenue targets for each respective year. In accordance with ASC 805, Business Combinations, the holdback amount is excluded from the purchase price allocation and will be recognized as compensation expense for post-combination services as earned.

The Acquisition was accounted for as a business combination in accordance with ASC 805, with the Company as the accounting acquirer. Under this method of accounting, Debary Animal Clinic's acquired assets are recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the estimated fair value of the net assets acquired is recognized as goodwill.

The following table summarizes the preliminary allocation of the purchase price to the assets acquired as of the acquisition date. These values are provisional and subject to adjustment during the measurement period (up to one year from the acquisition date) as additional information becomes available:

---

| | |
|:---|:---|
| Closing Cash Consideration | $1850000 |
| Closing Equity Consideration | 92500 |
| **Total Consideration** | **1942500** |
| Inventory | 40000 |
| Buildings | 487819 |
| Land | 148500 |
| Furniture, Fixtures & Equipment | 200000 |
| Goodwill | 1066181 |
| **Total Consideration** | $**1942500** |

---

The company incurred acquisition costs included in general and administrative of $70,046 related to the business acquisition.

The preliminary fair values assigned to the customer list and fixed assets (including buildings, land, and furniture, fixtures, and equipment) are based on management's initial estimates and have not yet been supported by independent third-party valuations or detailed internal analyses. These amounts are subject to change as the Company completes its valuation procedures and obtains additional information regarding the fair value of these assets. The final purchase price allocation may differ materially from these preliminary amounts, and any adjustments will be recognized retrospectively as required under ASC 805. The measurement period will not exceed one year from the acquisition date.

Goodwill is calculated as the excess of the total consideration transferred over the estimated fair value of the identifiable net assets acquired. The goodwill recognized in this transaction primarily reflects expected synergies from integrating the acquired operations, the assembled workforce, and other intangible assets that do not qualify for separate recognition. Goodwill is not deductible for tax purposes.

Any adjustments to the provisional amounts during the measurement period will be recognized retrospectively as if the accounting for the business combination had been completed at the acquisition date.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**17.** **Segment Information**

Management evaluates the Company's veterinary clinics as a single reportable segment as a result of aggregating multiple operating segments, because all of the Company's veterinary clinics have similar economic characteristics and provide similar services to similar types of customers. Our single reportable segment comprises the structure used by our Chief Executive Officer, who collectively have been determined to be our Chief Operating Decision Maker ("CODM"), to make key operating decisions and assess performance. Our CODM evaluates our single reportable segment's operating performance based on individual veterinary clinic net income (loss) before interest expense, income tax expense, depreciation and amortization, corporate general and administrative expense, debt extinguishment loss, gain of sale, interest and other income, and gains or losses on sales of clinic ("Adjusted Clinic EBITDA"). Our single reportable segment's assets are consistent with total assets included in the Company's consolidated balance sheets.

The following table includes revenue, significant veterinary clinic and hospital operating expenses, and Adjusted Clinic EBITDA for the Company's clinics, reconciled to the consolidated amounts included in the Company's consolidated statements of operations:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the three months ended<br> September 30,** | **For the three months ended<br> September 30,** | **For the nine months ended<br> September 30,** | **For the nine months ended<br> September 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenue** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Service revenue | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3138670 | $2969748 | $9074965 | $9735585 |
| &nbsp;&nbsp;&nbsp;Product revenue | 1177462 | 1079277 | 3163910 | 3535388 |
| Total Clinics level revenue | 4316132 | 4049025 | 12238875 | 13270973 |
| **Operating expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 2678940 | 2568085 | 7253536 | 7705972 |
| &nbsp;&nbsp;&nbsp;Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 850153 | 854921 | 2507227 | 2807025 |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | 610629 | 65093 | 2015056 | 2034074 |
| Total Clinics level expenses | 4139722 | 3488099 | 11775819 | 12547071 |
| **Adjusted Clinics EBITDA** | $176410 | $560926 | $463056 | $723902 |
| Reconciliation of Adjusted Clinics EBITDA to net income |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 330498 | 340167 | 864293 | 1048290 |
| &nbsp;&nbsp;&nbsp;Interest income | (4) | (44) | (25) | (46) |
| &nbsp;&nbsp;&nbsp;Interest expense | 559111 | 1254149 | 1385891 | 2801491 |
| &nbsp;&nbsp;&nbsp;Debt extinguishment loss |  |  | 689411 | 1587862 |
| &nbsp;&nbsp;&nbsp;Other income (expenses) |  |  |  | 4768 |
| &nbsp;&nbsp;&nbsp;Gain on sale of business |  | (467049) |  | (467049) |
| &nbsp;&nbsp;&nbsp;Corporate general and administrative | 1813078 | 2923029 | 5499364 | 6046125 |
| **Net Income** | $(2526273) | $(3489326) | $(7975878) | $(10297539) |

---

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Unaudited Condensed Consolidated Financial Statements**

**18.** **Subsequent Events**

The Company follows the guidance in FASB ASC 855-10 for the disclosure of subsequent events. The Company evaluated subsequent events through the date the financial statements were issued and determined the Company had the following subsequent events:

On October 6, 2025, the Company entered into a Merchant Cash Advance Agreement for gross proceeds of $525,000 with an unrelated third-party financial institution. Under the terms of the initial agreement, the Company pays $27,000 each week for 28 weeks with the first payment due October 17, 2025. The financing arrangement included issuance costs of $25,000.

On October 22, 2025, the Company entered into an additional Merchant Cash Advance Agreement for gross proceeds of $1,050,000 with the same unrelated third-party financial institution as above. Under the terms of the initial agreement, the Company pays $47,520 each week for 32 weeks with the first payment due October 31, 2025. The financing arrangement included issuance costs of $50,000.

In October 2025, the Company sold 151,894 shares of Class A common stock pursuant to a common stock purchase agreement dated July 29, 2025.

On November 5, 2025, the Company issued Senior Convertible Promissory Notes to two investors, each in the principal amount of $178,571.43 with an original issue discount of 30% such that the purchase price of each note was $125,000 (each a "Note" and together, the "Notes"). Each Note bears interest at a rate of 10% per annum, payable monthly, and matures on August 5, 2026, unless earlier converted or repaid in accordance with its terms. The outstanding principal and accrued interest under the Notes are convertible, at the option of the holder, into shares of the Company's Class A common stock. The conversion price is 90% of the lowest sale price of the Class A common stock for the twenty (20) consecutive trading days ending on the trading day that is immediately prior to the conversion date, subject to customary adjustments. Each investor's ownership is limited to 4.99% of the Company's outstanding Class A common stock. An Investor may increase or decrease the beneficial ownership limitation, but not in excess of 9.99% of the issued and outstanding shares of the Company's Class A common stock upon prior written notice to the Company.

The Notes must be prepaid by the Company in an amount equal to 25% of any gross proceeds received by the Company under an existing equity line of credit with the Investor. Any mandatory prepayment will be at a premium of 120%. Subject to the investors' conversion rights, if the Company completes a Qualified Financing, the Company will repay in full the then-outstanding principal amount of the Notes, any accrued but unpaid interest and a pre-payment premium equal to 120% of the Notes' value on the original issue date. A "Qualified Financing" is a financing in which the Company issues and sells shares of its equity securities to investors on or before the maturity date of the Notes with total gross proceeds to the Company of not less than $1,000,000, and excludes the conversion of the Notes or other convertible securities issued for capital raising purposes.

The Notes contain certain events of default, including non-payment, insolvency, breach of covenants, change of control and issuance of indebtedness by the Company without the Investors' consent, among others. Upon an event of default, all amounts outstanding under the Notes may become immediately due and payable at the option of the holder at a premium of 120%. In addition, for so long as the Notes remain outstanding, the interest rate will increase to an amount equal to the lesser of 24% per annum and the maximum rate permitted under applicable law.

**Report of Independent Registered Public Accounting Firm**

Board of Directors and Shareholders

Inspire Veterinary Partners, Inc.

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of Inspire Veterinary Partners, Inc. (the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of operations, changes in stockholders' equity (deficit), and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of Inspire Veterinary Partners, Inc. as of December 31, 2024 and 2023, and the consolidated results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

**Explanatory Paragraph – Going Concern** 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 3 to the financial statements, the Company has incurred recurring losses and at December 31, 2024, had an accumulated deficit of $36,350,281 and a working capital deficit of $6,176,268. For the year ended December 31, 2024, the Company sustained a net loss of $14,264,261 and used $10,005,866 in operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might become necessary should the Company be unable to continue as a going concern.

**Basis for Opinion**

 

These financial statements are the responsibility of the entity's management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to Inspire Veterinary Partners, Inc. in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Inspire Veterinary Partners, Inc. is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Kreit & Chiu CPA LLP

We have served as Inspire Veterinary Partners, Inc.'s auditor since 2021.

Los Angeles, California

March 31, 2025

**Inspire Veterinary Partners, Inc. and Subsidiaries** 

**Consolidated Balance Sheets** 

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2024** | **2023** |
| **Assets** |  |  |
| &nbsp;&nbsp;&nbsp;Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $523690 | $178961 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net | 40675 | 28573 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due from former owners |  | 32519 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | 516650 | 571512 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Refundable income tax |  | 151796 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 942456 | 388759 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 2023471 | 1352120 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted cash - non-current | 200000 | 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and equipment, net | 6382788 | 7949144 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Right-of-use assets | 1879729 | 1616198 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other intangibles, net | 1633927 | 2513028 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Goodwill | 8022082 | 8147590 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets | 53997 | 12895 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $20195994 | $21790975 |
| **Liabilities and Stockholder's Deficit** |  |  |
| &nbsp;&nbsp;&nbsp;Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $1979503 | $3206594 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | 285770 | 858334 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cumulative Series A preferred stock dividends payable |  | 92322 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | 183981 | 141691 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans payable, net of discount | 2340020 | 1713831 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Convertible debentures, net of issuance costs |  | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes payable, net of discount | 3410465 | 1469043 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 8199739 | 7581815 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities, non-current | 1943487 | 1514044 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes payable - noncurrent | 8490763 | 13483375 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 18633989 | 22579234 |
| Commitments and Contingencies (Note 15) |  |  |
| Stockholder's Equity (Deficit) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common stock - Class A, $0.0001 par value, 4 million shares authorized, 1,176,059 and 2,817 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively. | 117 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common stock - Class B, $0.0001 par value, 20 million shares authorized, 3,020,750 and 3,891,500 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively. | 302 | 389 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock, $0.0001 par value, 1 million shares authorized, 0 and 403,640 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively. |  | 40 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional paid in capital | 37911867 | 20426569 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated deficit | (36350281) | (21215257) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholder's equity (deficit) | 1562005 | (788259) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and stockholder's equity (deficit) | $20195994 | $21790975 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Consolidated Statements of Operations**

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2024** | **2023** |
| Service revenue | $12188526 | $11879934 |
| Product revenue | 4403583 | 4795459 |
| Total revenue | 16592109 | 16675393 |
| Operating expenses |  |  |
| Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 9736282 | 9700963 |
| Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 3563279 | 3420515 |
| General and administrative expenses | 11421352 | 9476287 |
| Depreciation and amortization | 1308619 | 1252539 |
| Impairment expense | 56664 |  |
| Gain on sale of business | (467049) | - |
| &nbsp;&nbsp;&nbsp;Total operating expenses | 25619147 | 23850304 |
| &nbsp;&nbsp;&nbsp;Loss from operations | (9027038) | (7174911) |
| Other income (expenses): |  |  |
| Interest income | 53 | 21 |
| Interest expense | (3098290) | (2538710) |
| Loss on debt extinguishment |  | (16105) |
| Loss on debt modification | (2134218) | (927054) |
| Beneficial conversion feature |  | (4137261) |
| Other income (expenses) | (4768) | 1134 |
| &nbsp;&nbsp;&nbsp;Total other expenses | (5237223) | (7617975) |
| &nbsp;&nbsp;&nbsp;Loss before income taxes | (14264261) | (14792886) |
| &nbsp;&nbsp;&nbsp;Benefit for income taxes | - | - |
| &nbsp;&nbsp;&nbsp;Net loss | (14264261) | (14792886) |
| &nbsp;&nbsp;&nbsp;Dividend on convertible series A preferred stock | (220850) | (271245) |
| &nbsp;&nbsp;&nbsp;Net loss attributable to class A and B common stockholders | $(14485111) | $(15064131) |
| Net loss per Class A and B common shares: |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | $(2.61) | $(3.50) |
| Weighted average shares outstanding per Class A and B common shares: |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | 5550959 | 4309796 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Consolidated Statements of Changes in Stockholders' Equity (Deficit)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Convertible Series A<br> Preferred Stock** | **Convertible Series A<br> Preferred Stock** | **Class A<br> Common Stock** | **Class A<br> Common Stock** | **Class B <br> Common Stock** | **Class B <br> Common Stock** | | | |
|  | **No. of Shares** | **Amount** | **No. of Shares** | **Amount** | **No. of Shares** | **Amount** | **Additional**<br>**Paid-in Capital** | **Accumulated**<br>**Deficit<br> (As Restated)** | **Stockholders'<br> (Deficit)**<br>**Equity<br> (As Restated)** |
| **Balance as of December 31, 2022** | - | $- | 388 | $- | 4300000 | $430 | $1107537 | $(6243448) | $(5135481) |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of warrants to CEO |  |  |  |  |  |  | 2701 |  | 2701 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of convertible series A preferred stock in exchange for bridge note | 442459 | 44 |  |  |  |  | 4440644 |  | 4440688 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock in connection with initial public offering, net of issuance costs |  |  | 640 |  |  |  | 5439571 |  | 5439571 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible debentures into class A common stock |  |  | 598 |  |  |  | 4414317 |  | 4414317 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of class B common stock into class A common stock |  |  | 163 |  | (408500) | (41) | 41 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible series A preferred stock into class A common stock | (56711) | (6) | 792 |  |  |  | 6 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock cumulative dividends |  |  |  |  |  |  | (92322) |  | (92322) |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock dividend | 17892 | 2 |  |  |  |  | 178921 | (178923) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of common stock in connection with business acquisition |  |  | 163 |  |  |  | 400000 |  | 400000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of common stock for services |  |  | 72 |  |  |  | 397892 |  | 397892 |
| &nbsp;&nbsp;&nbsp;&nbsp;Beneficial conversion feature on convertible debentures |  |  |  |  |  |  | 1569395 |  | 1569395 |
| &nbsp;&nbsp;&nbsp;&nbsp;Beneficial conversion feature on convertible series A preferred stock |  |  |  |  |  |  | 2567866 |  | 2567866 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net Loss |  |  |  |  |  |  |  | (14792886) | (14792886) |
| **Balance as of December 31, 2023** | 403640 | $40 | 2817 | $- | 3891500 | $389 | $20426569 | $(21215257) | $(788259) |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of Class A common stock and pre-funded warrants in connection with commitment shares |  |  | 486 |  |  |  | 600000 |  | 600000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock and pre-funded warrants, net of issuance costs |  |  | 73144 | 7 |  |  | 5227032 |  | 5227039 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock and warrants, net of issuance costs |  |  | 5859 | 1 |  |  | 5459999 |  | 5460000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock for services |  |  | 18705 | 2 |  |  | 376694 |  | 376696 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of class A common stock in connection with general release agreement |  |  | 98 |  |  |  | 20000 |  | 20000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Issuance of convertible series A preferred stock | 20000 | 2 |  |  |  |  | 199998 |  | 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible notes payable |  |  | 226249 | 22 |  |  | 1357121 |  | 1357143 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible series A preferred stock into class A common stock | (445725) | (44) | 24767 | 3 |  |  | 41 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock cumulative dividends |  |  |  |  |  |  | (2250) |  | (2250) |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible series A preferred stock dividend | 22085 | 2 |  |  |  |  | 223098 | (220850) | 2250 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of class A common stock warrants |  |  | 240000 | 24 |  |  | 3999976 |  | 4000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Exercise of pre-funded warrants |  |  | 583934 | 58 |  |  | (58) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Repurchase and cancellation of the class B common stock |  |  |  |  | (870750) | (87) |  | (649913) | (650000) |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  |  |  | 23647 |  | 23647 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | - | (14264261) | (14264261) |
| **Balance as of December 31, 2024** | - | - | 1176059 | 117 | 3020750 | 302 | 37911867 | (36350281) | 1562005 |

---

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Consolidated Statements of Cash Flows**

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2024** | **2023** |
| **Cash flows from operating activities:** |  |  |
| Net loss | $(14264261) | $(14792886) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 1337723 | 1252540 |
| &nbsp;&nbsp;&nbsp;Amortization of debt issuance costs | 15825 | 128583 |
| &nbsp;&nbsp;&nbsp;Amortization of debt discount | 2275594 | 864350 |
| &nbsp;&nbsp;&nbsp;Amortization of operating right of use assets | 329878 | 162298 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 23647 |  |
| &nbsp;&nbsp;&nbsp;Issuance of warrants to CEO |  | 2701 |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock for services | 376696 | 397892 |
| &nbsp;&nbsp;&nbsp;Debt extinguishment loss |  | 16105 |
| &nbsp;&nbsp;&nbsp;Loss on debt modification | 2134218 | 927054 |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock in connection with general release agreement | 20000 |  |
| &nbsp;&nbsp;&nbsp;Issuance of Class A common stock and pre-funded warrants in connection with commitment shares | 600000 |  |
| &nbsp;&nbsp;&nbsp;Bad debt provision |  | 123513 |
| &nbsp;&nbsp;&nbsp;Beneficial conversion feature |  | 4137261 |
| &nbsp;&nbsp;&nbsp;Gain on disposal of business | (467049) |  |
| &nbsp;&nbsp;&nbsp;Impairment expense | 56664 |  |
| Changes in operating assets and liabilities, net of effect of acquisitions: |  |  |
| &nbsp;&nbsp;&nbsp;Accounts receivable | (12102) | (152086) |
| &nbsp;&nbsp;&nbsp;Due from former owners | 32519 | 237364 |
| &nbsp;&nbsp;&nbsp;Inventory | 12418 | 84912 |
| &nbsp;&nbsp;&nbsp;Refundable income tax | 151796 | 40343 |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (553697) | (134964) |
| &nbsp;&nbsp;&nbsp;Other assets | (41102) |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | (1227091) | 2187663 |
| &nbsp;&nbsp;&nbsp;Accrued expenses | (593544) | 813144 |
| &nbsp;&nbsp;&nbsp;Cumulative Series A preferred stock dividends payable | (92322) |  |
| &nbsp;&nbsp;&nbsp;Other assets, net |  | 16561 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | (121676) | (133119) |
| Net cash used in operating activities | (10005866) | (3820771) |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment | (237983) | (383730) |
| &nbsp;&nbsp;&nbsp;Payment for acquisition of businesses | - | (1485800) |
| Net cash used in investing activities | (237983) | (1869530) |
| **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of class A common stock and warrants, net of issuance costs | 5460000 | 5439571 |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of class A common stock and pre-funded warrants, net of issuance costs | 5227039 |  |
| &nbsp;&nbsp;&nbsp;Repurchase and cancellation of the class B common stock | (650000) |  |
| &nbsp;&nbsp;&nbsp;Net proceeds from loans payable | 1981585 | 2038531 |
| &nbsp;&nbsp;&nbsp;Payments on loans payable | (5113947) | (1923474) |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of convertible series A preferred stock | 200000 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from convertible note payable | 1000000 | 650000 |
| &nbsp;&nbsp;&nbsp;Payments on convertible note payable | (294118) | (250000) |
| &nbsp;&nbsp;&nbsp;Repayment of note payable | (1121981) | (329620) |
| &nbsp;&nbsp;&nbsp;Proceeds from exercise of warrants | 4000000 |  |
| &nbsp;&nbsp;&nbsp;Repayment of convertible debentures | (100000) | - |
| Net cash provided by financing activities | 10588578 | 5625009 |
| &nbsp;&nbsp;&nbsp;Net increase (decrease) in Cash, cash equivalents and restricted cash | 344729 | (65292) |
| &nbsp;&nbsp;&nbsp;Cash, cash equivalents and restricted cash, beginning of period | 378961 | 444253 |
| &nbsp;&nbsp;&nbsp;Cash, cash equivalents and restricted cash, end of period | $723690 | $378961 |
| **Supplemental Disclosure of Cash Flow Information** |  |  |
| &nbsp;&nbsp;&nbsp;Interest payments during the year | $1552313 | $188952 |
| &nbsp;&nbsp;&nbsp;Income tax refund | $151796 | $- |
| **Noncash investing and financing activity** |  |  |
| &nbsp;&nbsp;&nbsp;Series A Preferred Stock Dividend | $220850 | $271245 |
| &nbsp;&nbsp;&nbsp;Acquisition of assets through operating leases | 593409 | 1031523 |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock for conversion of convertible notes payable | 1357143 | - |
| &nbsp;&nbsp;&nbsp;Issuance of common stock in connection with business acquisition | - | 400000 |
| &nbsp;&nbsp;&nbsp;Issuance of convertible series A preferred stock due to conversion of bridge note | - | 4440688 |
| &nbsp;&nbsp;&nbsp;Issuance of class A common stock due to conversion of convertible debentures | - | 4414317 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**Inspire Veterinary Partners, Inc. and Subsidiaries**

**Notes to Consolidated Financial Statements**

**December 31, 2024**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Description of Business** 

**Business Description**

Inspire Veterinary Partners, Inc. (the "Company" or "Inspire") is a C-corporation which incorporated in the state of Delaware on December 2, 2020. On June 29, 2022, the Company converted into a Nevada C-corporation ("Conversion"). The Conversion did not result in any change in the corporate name, business, management, fiscal year, accounting, location of the principal executive officer, capitalization structure, or assets or liabilities of the Company. The Company owns and operates veterinary hospitals throughout the United States. The Company specializes in small animal general practice hospitals which serve all manner of companion pets, emphasizing canine and feline breeds.

As we expand, additional modalities are becoming a part of the services offered at our hospitals, including equine care. With 13 clinics located in 9 states as of the date of this filing, Inspire purchases existing hospitals which have the financial track record, marketplace advantages and future growth potential to make them worthy acquisition targets. Because the Company leverages a leadership and support structure which is distributed throughout the United States, acquisitions are not centralized to one geographic area. The Company operates its business as one operating and one reportable segment.

Services provided at owned hospitals include preventive care for companion animals consisting of annual health exams which include: parasite control; dental health; nutrition and body condition counseling; neurological examinations; radiology; bloodwork; skin and coat health and many breed specific preventive care services. Surgical offerings include all soft tissue procedures such as spays and neuters, mass removals, splenectomies and can also include gastropexies, orthopedic procedures and other types of surgical offerings based on a doctor's training. In many locations additional means of care and alternative procedures are also offered such as acupuncture, chiropractic and various other health and wellness offerings.

The Company is the managing member of IVP Practice Holdings Co., LLC ("Holdco"), a Delaware limited liability company, which is the managing member of IVP CO Holding, LLC ("CO Holdco"), a Delaware limited liability company, IVP FL Holding Co., LLC ("FL Holdco"), a Delaware limited liability company, IVP Texas Holding Company, LLC ("TX Holdco"), a Delaware limited liability company, KVC Holding Company, LLC ("KVC Holdco"), a Hawaii limited liability company, and IVP CA Holding Co., LLC ("CA Holdco"), a Delaware limited liability company, IVP MD Holding Company, LLC ("MD Holdco"), a Delaware limited liability company, IVP OH Holding ("OH Holdco"), Co, LLC, a Delaware limited liability company, IVP IN Holding Co., LLC ("IN Holdco"), a Delaware limited liability company, IVP MA Managing Co., LLC, a Delaware limited liability company ("MA Holdco"), and IVP PA Holding Company, LLC, a Delaware limited liability company ("PA Holdco"). The Company through Holdco, operates and controls all business and affairs of CO Holdco, FL Holdco, TX Holdco, KVC Holdco, CA Holdco, MD Holdco. Holdco, OH Holdco, IN Holdco, MA Holdco and PA Holdco are used to acquire hospitals in various states and jurisdictions.

The Company is the managing member of IVP Real Estate Holding Co., LLC ("IVP RE"), a Delaware limited liability company, which is the managing member of IVP CO Properties, LLC ("CO RE"), a Delaware limited liability company, IVP FL Properties, LLC ("FL RE"), a Delaware limited liability company, IVP TX Properties, LLC ("TX RE"), a Delaware limited liability company, KVC Properties, LLC, ("KVC RE"), a Hawaii limited liability company, IVP CA Properties, LLC ("CA RE"), a Delaware limited liability company, IVP MD Properties, LLC ("MD RE"), a Delaware limited liability company, IVP OH Properties, LLC ("OH RE"), a Delaware limited liability company, IVP IN Properties, LLC ("IN RE"), a Delaware limited liability company, and IVP PA Properties, LLC ("PA RE"), a Delaware limited liability company. The Company through IVP RE operates and controls all business and affairs of CO RE, FL RE, TX RE, KVC RE, CA RE, MD RE, OH RE, IN RE and PA RE. IVP RE are used to acquire real property in various states and jurisdictions.

![](image_003.jpg)

**Initial Public Offering**

On August 31, 2023, we closed our IPO of 640 shares of class A common stock, at a public price of $1,000.00 per share. The total net proceeds we received in the IPO were approximately $5.4 million after deducting underwriting discounts and commissions of $512,000 and offering expenses of $448,429. The Company's class A common shares are traded on the Nasdaq Capital Market ("NASDAQ") under the symbol IVP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **RETROSPECTIVE ADJUSTMENTS** 

On May 8, 2024, the Company effected a 100-for-1 reverse stock split ("Reverse Split") of the Company's authorized and outstanding shares of Class A common stock. All information included in these financial statements has been adjusted, on a retrospective basis for all periods presented to reflect the Reverse Split, unless otherwise stated.

On January 27, 2025, the Company effected a 25-for-1 reverse stock split ("Reverse Split") of the Company's authorized and outstanding shares of Class A common stock. All information included in these financial statements has been adjusted, on a retrospective basis for all periods presented to reflect the Reverse Split, unless otherwise stated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **Significant Accounting Policies and Basis of Presentation** 

**Basis of Presentation**

The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America ("GAAP"). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification ("ASC") and as amended by Accounting Standards Updates ("ASU") of the Financial Accounting Standards Board ("FASB").

**Going Concern**

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring losses and as of December 31, 2024, had an accumulated deficit of $36,350,281. For the year ending December 31, 2024, the Company sustained a net loss of $14,264,261. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern for the next twelve months from the date these financial statements were issued. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is contingent upon its ability to obtain additional financing and to generate revenue and cash flow to meet its obligations on a timely basis. The Company will continue to seek to raise additional funding through debt or equity financing during the next twelve months from the date of issuance of these financial statements. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving these objectives.

**Principles of Consolidation**

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

**Use of Estimates**

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of sales and expenses during the reporting period. Actual results could differ from those estimates.

**Cash and Cash Equivalents**

The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. As of December 31, 2024 and 2023 the Company had no cash equivalents.

Financial instruments that potentially subject the Company to a significant concentration of credit risk consist of cash. Cash is deposited in checking accounts at accredited financial institutions with high credit-quality and is insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000, which at times, may exceed federally insured limits. The excess amounts as of December 31, 2024 and 2023, were $473,690 and $114,080, respectively. Management believes that these financial institutions are financially sound, and, accordingly, minimal credit risk exists with respect to these high-quality financial institutions.

**Restricted Cash**

Restricted Cash consisted of cash designated to settle a holdback agreement related to our acquisition of Valley Veterinary Services, Inc. to be settled by February 8, 2026 if specific contingencies are met (see note 12 for more information).

**Accounts Receivable and Allowance for Expected Credit Losses**

Accounts receivable consist of amounts due from veterinary customers. The Company records an allowance for current expected credit losses for estimated losses inherent in its trade accounts receivable portfolio. In establishing the required allowance, management considers historical losses adjusted for current market conditions, the financial condition of the customer, the amount of receivables in dispute, and the current receivables aging and payment patterns. The Company does not have any off-balance sheet credit exposure related to its customers. The allowance for current expected credit losses was $2,892 and $123,513 as of December 31, 2024 and 2023, respectively. During the years ended December 31, 2024 and 2023, the company wrote-off $89,725 and $0 from the allowance for current expected credit losses, respectively.

**Due from Former Owners**

The Company enters into asset purchase agreements related to the acquisitions of veterinary hospitals and as part of these agreements contractually obligates the former owners of the veterinary hospitals to reimburse the Company for any monies collected by the former owners for revenues earned subsequent to the closing date of the acquisition, less monies paid by the former owner on behalf of the Company for expenses incurred subsequent to the closing date of the acquisition. Any adjustments relating to pre-acquisition amounts will be reflected in goodwill.

**Inventory**

Inventory is recorded at the lower of cost or net realizable value. Cost is using the weighted average method. Inventory consists of inventoriable supplies used for veterinary care and services.

**Leases**

The Company reviews all arrangements for potential leases, and at inception, determines whether a lease is an operating or finance lease. Lease assets and liabilities, which generally represent the present value of future minimum lease payments over the term of the lease, are recognized as of the commencement date. Leases with an initial lease term of twelve months or less are classified as short-term leases and are not recognized in the balance sheets unless the lease contains a purchase option that is reasonably certain to be exercised.

Lease term, discount rate, variable lease costs and future minimum lease payment determinations require the use of judgment and are based on the facts and circumstances related to the specific lease. Lease terms are generally based on their initial non-cancellable terms, unless there is a renewal option that is reasonably certain to be exercised. Various factors, including economic incentives, intent, past history and business needs are considered to determine if a renewal option is reasonably certain to be exercised. The implicit rate in a lease agreement is used when it can be determined to value the lease obligation. Otherwise, the Company's incremental borrowing rate, which is based on information available as of the lease commencement date, including applicable lease terms and the current economic environment, is used to determine the value of the lease obligation.

**Property and Equipment**

Property and equipment are recorded at cost, less accumulated depreciation. Depreciation of property and equipment is determined using the straight line method over the estimated useful lives of the related assets up to the salvage value. Expenditures for repairs and maintenance are charged to expense as incurred, and expenditures for betterments and major Improvements are capitalized and depreciated over the remaining useful lives of the assets. The carrying amount of the assets sold or retired and the related accumulated depreciation are eliminated in the year of disposal, with resulting gains or losses included in operations.

Estimated useful lives are as follows for major classes of property and equipment:

---

| | |
|:---|:---|
| Computers and equipment | 3 – 7 years |
| Furniture and fixtures | 5 – 7 years |
| Automobile | 5 – 7 years |
| Leasehold improvements | 5 – 15 years |
| Buildings | 5 – 15 years |

---

**Acquisitions**

The Company enters into acquisitions primarily with existing veterinary hospitals throughout the United States. When we acquire a business or assets that are determined to meet the definition of a business, we allocate the purchase consideration paid to acquire the business to the assets and liabilities acquired based on estimated fair values at the acquisition date, with the excess of purchase price over the estimated fair value of the net assets acquired recorded as goodwill. If during the measurement period (a period not to exceed 12 months from the acquisition date) we receive additional information that existed as of the acquisition date but at the time of the original allocation described above was unknown to us, we make the appropriate adjustments to the purchase price allocation in the reporting period that the amounts are determined.

**Goodwill**

Goodwill represents the excess of the cost of an acquired business over the fair value assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include significant changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.

The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than it's carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.

The Company has recorded Goodwill in connection with business acquisitions during the year ended December, 31 2023 (see Note 5). During the years ended December 31, 2024 and 2023, the Company recorded no impairment of Goodwill.

**Intangible Assets**

Intangible assets consist of client list, trademark and non-compete intangibles that result from the acquisition of veterinary hospitals or practices. Client list intangible assets represent the value of the long-term client relationship from the veterinary hospitals and practices. Trademark intangible assets represent the value associated with the brand names in place at the date of the acquisition. Non-compete intangible assets represent the value associated with non-compete agreements for former employees and owners in place at the date of the acquisition. The client lists and trademarks' are included in intangible assets reported in the balance sheet which are being amortized over a 5-year term based on the estimated economic useful life of the client list and trademark. The non-compete intangible asset included in other intangibles, net is amortized over a 2-year term based on the estimated useful life of the asset. The amortization of the intangible asset is computed using the straight-line method. The intangibles are evaluated for impairment on an annual basis or more frequently whenever events or circumstances occur indicating that the carrying amount may not be recoverable.

**Revenue Recognition**

The Company recognizes service revenue from veterinary care services once the service is completed, as this is when the customer has the ability to direct the use of and obtain the benefits of the service. Payment terms are typically at the point of sale but may also occur upon completion of the service. The Company's service contracts are primarily with veterinary customers. Product revenue is recognized when control passes, which occurs at a point in time when the customer completes a transaction at our animal hospitals or clinics and receives the product. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account for revenue recognition. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company's performance obligations are the delivery of veterinary services at the estimated net realizable amount for those services and goods. The Company's accounting methodologies and processes include an evaluation of the historical collection and consideration of whether contractual allowances are necessary based on historical experience. Revenue is reported net of sales discounts and excludes sales taxes.

**Cost of service revenue (exclusive of depreciation and amortization)**

Cost of service revenue consists of cost directly related to the animal services provided at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, laboratory costs, pet supply costs, third-party veterinarian contractors, office rent, utilities, supplies, and other cost arising as a result of the services being performed, excluding depreciation and amortization.

**Cost of product revenue (exclusive of depreciation and amortization)**

Cost of product revenue consists of cost directly related to the product sales at the Company's veterinary clinics and animal hospitals, which primarily includes personnel-related compensation costs of the employees at the Company's veterinary clinics or animal hospitals, purchase price of the medication we dispense, and purchase price of product sold, excluding depreciation and amortization.

**General and administrative expenses**

General and administrative expenses include personnel-related compensation costs for corporate employees, such as management, accounting, legal, acquisition related and non-recurring expenses, insurance and other expenses used to operate the business.

**Depreciation and Amortization Expense**

Depreciation and amortization expenses mainly relate to the assets used in generating revenue.

**Convertible Instruments**

The Company evaluates and accounts for conversion options embedded in convertible instruments in accordance with ASC 815 "Derivatives and Hedging Activities".

Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

The Company accounts for convertible instruments (when we have determined that the embedded conversion options should not be bifurcated from their host instruments) as follows: The Company records when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption. The Company recognized a beneficial conversion feature of $1,569,395 during the year ended December 31, 2023.

The Company records a discount to convertible notes and convertible preferred stock for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note, if applicable. Debt discounts under these arrangements are amortized to noncash interest expense using the effective interest rate method over the term of the related debt to their date of maturity.

**Debt Issuance Costs**

Debt issuance costs are specifically identifiable costs associated with issuance of a new debt instrument. Debt issuance costs are reported on the consolidated balance sheet as a direct deduction from the face amount of the related debt. Debt issuance costs are amortized to interest expense over the term of the related debt.

**Advertising Costs**

The Company expenses advertising costs as they are incurred. Advertising expenses were $181,473 and $107,766 for the years ending December 31, 2024 and 2023, respectively. These costs are included in "General and administrative expenses" in the accompanying consolidated statements of operations.

**Stock Warrants**

Certain warrants that were granted by the Company for lenders through convertible bridge loans transactions (see also Note 8 Debt - Bridge Note) are classified as a component of permanent equity since they are freestanding financial instruments that are legally detachable and separately exercisable, do not embody an obligation for the Company to repurchase its own shares, and permit the holders to receive a fixed number of shares of common stock upon exercise for a fixed exercise price and thus, are considered as indexed to the Company's own stock. In addition, the warrants must require physical settlement and may not provide any guarantee of value or return. We present the allocated value for the warrants within additional paid-in capital in our consolidated balance sheet. The value assigned to the warrants was determined based on a relative fair value allocation between the warrants and related debt. The fair value of the warrants was determined using a Black Scholes valuation and applying a discount for the lack of marketability for the warrants.

**Income Tax**

The Company and its U.S. subsidiaries file a consolidated federal income tax return and is taxed as a C-Corporation, whereby it is subject to federal and state income taxes. The Company accounts for income taxes in accordance with ASC 740, "Income Taxes". ASC 740 requires an asset and liability approach for financial accounting and reporting for income taxes and established for all the entities a minimum threshold for financial statement recognition of the benefit of tax positions and requires certain expanded disclosures. The provision for income taxes is based upon income or loss after adjustment for those permanent items that are not considered in the determination of taxable income. Deferred income taxes represent the tax effects of differences between the financial reporting and tax basis of the Company's assets and liabilities at the enacted tax rates in effect for the years in which the differences are expected to reverse. The Company evaluates the recoverability of deferred tax assets and establishes a valuation allowance when it is more likely than not that some portion or all the deferred tax assets will not be realized. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In management's opinion, adequate provisions for income taxes have been made. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary.

**Stock-Based Compensation**

The stock-based payments are accounted for in accordance with the provisions of ASC 718, Compensation — Stock Compensation. The Company measures the estimated fair value of the stock-based award on the date of grant using the Black-Scholes-Merton option pricing model ("Black-Scholes Model") and recognizes compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award. The Black-Scholes Model requires the use of a number of assumptions including volatility of the stock price, the weighted average risk-free interest rate, and the vesting period in determining the fair value of stock-based awards. The expected term is based on the "simplified method", due to the Company's limited stock award history. Under this method, the term is estimated using the weighted average of the service vesting period and contractual term of the option award. As the Company Class A common stock has a limited history in the public markets, the Company has identified several public entities of similar size, complexities and industry and calculates historical volatility based on the volatilities of these companies. Although the Company believes its assumptions used to calculate stock-based compensation expenses are reasonable, these assumptions can involve complex judgments about future events, which are open to interpretation and inherent uncertainty. In addition, significant changes to our assumptions could significantly impact the amount of expense recorded in a given period. The Company accounts for forfeitures in the period in which they occur, rather than estimate expected forfeitures.

**Basic and Diluted Net Loss Per Share**

Basic net loss per common share is computed by dividing net loss by the weighted-average number of common shares outstanding during each period. Diluted net loss per share of common shares includes the effect, if any, from the potential exercise or conversion of securities, such as convertible debt, share options and warrants, which would result in the issuance of incremental shares of common shares. For diluted net loss per share, the weighted-average number of common shares is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive. For all periods presented, basic and diluted net loss per share are the same, as any additional share equivalents would be anti-dilutive.

The following outstanding potentially dilutive Common Shares equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive:

---

| | | |
|:---|:---|:---|
|  | **Year ended** | **Year ended** |
|  | **December 31,** | **December 31,** |
|  | **2024** | **2023** |
| Warrants | $1142 | $384 |
| Convertible Series A Preferred Shares |  | 6458 |
| Stock Options | 4747 | - |
| Total | $5889 | $6842 |

---

**Recently Adopted Accounting Pronouncements**

On November 27, 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which requires incremental disclosures related to an entity's reportable segments, effective for annual periods beginning after December 15, 2023. The Company adopted ASU 2023-07 on December 31, 2024, which resulted in additional disclosures in the notes to our consolidated financial statements that we applied retrospectively to all prior periods presented. See Note 16. Segment Information.

The FASB and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2024. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company's reported financial position or operations in the near term.

**Emerging Growth Company Status**

The Company is an Emerging Growth Company, as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **Property and equipment** 

As of December 31, 2024 and 2023, property and equipment, net, consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2024** | **2023** |
| Land | $1333810 | $1983810 |
| Buildings | 3951512 | 4607874 |
| Computers and equipment | 1403400 | 1425774 |
| Furniture and fixtures | 129204 | 143874 |
| Automobile | 80219 | 101269 |
| Leasehold improvements | 713733 | 499310 |
|  | 7611878 | 8761911 |
| Less - accumulated depreciation | (1229090) | (812767) |
| Property and Equipment, net | $6382788 | $7949144 |

---

Depreciation expense was $559,380 and $503,477 for the years ended December 31, 2024 and 2023, respectively.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **Goodwill and Intangible Assets** 

The following table shows the changes in the carrying amount of goodwill for the years ended December 31, 2024 and 2023:

---

| | |
|:---|:---|
| **Goodwill as of December 31, 2022** | $7614553 |
| Acquisitions | 533037 |
| **Goodwill as of December 31, 2023** | 8147590 |
| Disposals | (125508) |
| **Goodwill as of December 31, 2024** | $8022082 |

---

There was no goodwill impairment recognized in the years ended December 31, 2024 and 2023.

The following summarizes the Company's intangibles assets not including goodwill as of December 31, 2024 and 2023:

---

| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2024** | **2023** |
| Client List | $1916444 | $2071000 |
| Noncompete Agreement | 398300 | 398300 |
| Trademark | 1047792 | 1117200 |
| Other Intangible Assets | 45836 | 45836 |
| Accumulated amortization | (1774445) | (1119308) |
|  | $1633927 | $2513028 |

---

Amortization expenses were $778,343 and $749,062 for the years ended December 31, 2024 and 2023, respectively.

Expected future amortization expense of intangible assets as of December 31, 2024 is as follows:

---

| | |
|:---|:---|
| 2025 | $608025 |
| 2026.0 | 575259 |
| 2027.0 | 368079 |
| 2028.0 | 82564 |
| 2029.0 | - |
|  | $1633927 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **Business acquisitions** 

**<u>Valley Veterinary Service</u>**

On November 8, 2023, the Company acquired the animal hospital and related assets of Valley Veterinary Service, Inc., a Pennsylvania corporation ("Valley Vet Practice") by entering into an Asset Purchase Agreement ("Valley Vet APA") with Michelle Bartus, VMD and Peter Nelson, VMD ("Valley Vet") in exchange for the payment of $800,000 in cash, issuance of restricted shares of the Company's Class A common stock equal to the quotient obtained by dividing $400,000 by the official closing price of one share of Class A common stock as reported by the Nasdaq Capital Market on the trading date immediately prior to the closing and a holdback agreement for $200,000 in cash that may be paid out at the end of the two year period following the acquisition based on continued employment by the two former owners and revenue targets for year 1 and year 2 following the effective date of the acquisition, which is not included in the consideration transferred through the Company's wholly owned subsidiary IVP PA Holding Company, LLC. Simultaneously, the real estate operations (land and building) utilized by the Valley Vet animal hospital were purchased through a Real Estate Purchase Agreement in exchange for $590,000 from Valley Vet through the Company's wholly owned subsidiary, IVP PA Properties, LLC.

The total consideration paid for the combined acquisitions from the Valley Vet animal hospital in the amount of $1,790,000 was accounted for as single business combinations, in accordance with ASC Topic 805. The Company will record the assets acquired and liabilities assumed at their respective fair values as of the acquisition date. Due to the timing of the acquisition, the Company's purchase accounting related to the valuation of the inventory, fixed assets, intangible assets, goodwill and liabilities assumed is not yet complete and subject to revision.

---

| | |
|:---|:---|
| Consideration: |  |
| &nbsp;&nbsp;&nbsp;Cash paid prior to the time of closing | $1390000 |
| &nbsp;&nbsp;&nbsp;Consideration paid in Common Stock | 400000 |
| Acquisition costs included in general and administrative | 39535 |
| Recognized amounts of identifiable assets acquired |  |
| &nbsp;&nbsp;&nbsp;Inventory | 74405 |
| &nbsp;&nbsp;&nbsp;Building | 445786 |
| &nbsp;&nbsp;&nbsp;Land | 144214 |
| &nbsp;&nbsp;&nbsp;Furniture, fixtures & equipment | 64058 |
| &nbsp;&nbsp;&nbsp;Trademark (5-year life) | 264500 |
| &nbsp;&nbsp;&nbsp;Non-compete agreement (2-year life) | 44000 |
| &nbsp;&nbsp;&nbsp;Client list (5-year life) | 220000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total identifiable net assets assumed | 1256963 |
| &nbsp;&nbsp;&nbsp;Goodwill | 533037 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $1790000 |

---

**Pro-Forma Financial Information (Unaudited)**

The following unaudited pro forma information presents the consolidated results of Valley Vet Practice included in the Company's consolidated statement of operations for the year end December 31, 2023, as if the acquisitions were made on January 1, 2023. The unaudited pro forma information is presented for illustrative purposes only. It is not necessarily indicative of the results of operations of future periods, or the results of operations that actually would have been realized had the entities been a single company during the periods presented or the results that the combined company will experience after the acquisition. The unaudited pro forma information does not give effect to the potential impact of current financial conditions, regulatory matters or any anticipated synergies, operating efficiencies or cost savings that may be associated with the acquisition. The unaudited pro forma information also does not include any integration costs or remaining future transaction costs that the companies may incur related to the acquisition as part of combining the operations of the companies. As a result of the adjustment, $23,220 of amortization expense for the acquired intangible assets was applied in calculating the Net Loss, for the years ended December 31, 2023.

The unaudited pro forma consolidated results of revenue and net loss, assuming the acquisitions had occurred on January 1, 2023, is as follows:

---

| | |
|:---|:---|
|  | **Year Ended**<br>**December 31,<br> 2023** |
| Revenue | $18438565 |
| Net loss | $(14840964) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **Business disposal** 

On September 20, 2024, the Company completed the divestiture of its Kauai Veterinary Clinic ("KVC") to Kauai RE Holdings LLC for $2.0 million, in notes payable assumed by the buyer, with no cash consideration. The agent for the sale was Gregory Armstrong, a current shareholder of the Company and a member of Kauai RE. Charles Keiser, DVM, is a member of Kauai RE and the father of our board member Charles Stith Keiser, who is the Company's largest shareholder through his entity Wilderness Trace Veterinary Partners, LLC. The divestiture resulted in a gain of $467,049 in fiscal year 2024, which was recorded in "Gain on sale of business" in the Statements of Operations. As a result of the transaction, the Company disposed of $125,508 of goodwill based on the relative fair value of KVC. The estimated fair value of KVC less estimated costs to sell exceeded it carrying amount as of the transaction date. As the sale of KVC was not considered a significant disposal or a strategic shift that would have a major effect on the Company's operations or financial results, it was not reported as discontinued operations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **Debt** 

**Master Lending and Credit Facility**

On June 25, 2021, the Company entered into a master line of credit loan agreement ("MLOCA") with Wealth South a division of Farmers National Bank of Danville, Kentucky ("FNBD"). The MLOCA provides for a $2,000,000 revolving secured credit facility ("Revolving Line") to be drawn for the initial purchase of veterinary clinical practices ("Practices") and a $8,000,000 closed end line of credit ("Closed End Line") to be disbursed as individual loans (Term Loans) to paydown draws on the Revolving Line and to provide longer term financing of the purchase of Practices. Each draw on the Revolving Line shall be repaid with a Term Loan out of the Closed End Line within one hundred and twenty (120) days of the draw on the Revolving Line. Each draw on the Revolving Line and the Closed End Line shall not exceed eighty-five (85%) percent of the purchase price of the Practice. The Company shall contribute and maintain equity of a minimum of fifteen (15%) percent of the initial purchase price of a Practice as long as any draw on the Revolving Line or a Term Loan remains unpaid with FNBD. The Revolving Line has an interest rate equal to the New York Prime Rate plus 0.50% that shall never be less than 3.57%. Each Term Loan issued under the Closed End Line shall have a fixed interest rate of 3.98% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest rate will equal to the New York Prime Rate plus 0.65% that shall never be less than 3.57%. Each Practice to be acquired must have a minimum projected debt-service coverage ratio ("DSCR") of 1.0x, defined as earnings before interest depreciation and amortization ("EBIDA")/Annual Debt Service Requirement.

Under the MLOCA the Term Loans to acquire a Practice shall not exceed 10 years. The first twelve months of the Term Loan may be interest only. Thereafter, the Loan will convert to an amortizing loan with monthly principal and interest payments. For Practice only Term Loans ("Practice Term Loans"), after the initial twelve-month interest only period, the balance will amortize over 9 years. For Loans made to purchase real property ("RE Term Loans"), after the initial twelve-month interest only period, the balance will amortize over a 19-year period.

There is no prepayment penalty on payments on the Revolving Line. The Term Loans are subject to a refinance fee of 2% of the then outstanding principal balance of the Term Loan if paid within two years of entering into the Term Loan and 1% of the then outstanding principal balance of the Term Loan if paid within three to five years of entering into the Term Loan. The refinance fee is due only if the Term Loan is paid off by refinancing. Borrowing under the MLOCA are guaranteed by Kimball Carr, CEO & President of the Company.

On August 18, 2022 the MLOCA was amended and restated to terminate the revolving feature on the Revolving Line and convert the line of credit to a closed end draw note ("Closed End Draw Note") that mature on August 18, 2024. Each draw on the Closed End Draw Note shall not exceed eighty-five (85%) percent of the purchase price of the Practice. The Company shall contribute and maintain equity of a minimum of fifteen (15%) percent of the initial purchase price of a Practice as long as any draw on the Closed End Draw Note or a Term Loan remains unpaid with FNBD. The interest rate charge on all sums advance under the amended and restated MLOCA shall be 5.25% for the first five years of the loan. Immediately following the fixed rate period, the rate of interest will be equal to the New York Prime Rate plus 0.65% that shall never be less than 4.75%. Each Practice to be acquired must have a minimum projected DSCR of 1.0x, defined as EBIDA/Annual Debt Service Requirement. The MLOCA has been fully drawn against, see the notes payable for the individual notes payable to FNDB for further detail below.

Notes payable to FNBD as of December 31, 2024 and 2023 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **December 31,**<br>**2024** | **December 31,**<br>**2023** | **Issuance**<br>**Cost** |
| $237272 | CAH | 12/27/2021 | 12/27/2041 | 3.98% | $219975 | $228785 | $6108 |
| 231987 | CAH | 12/27/2021 | 12/27/2031 | 3.98% | 187461 | 210161 | 6108 |
| 216750 | P&F | 12/27/2021 | 12/27/2041 | 3.98% | 200949 | 208997 | 5370 |
| 318750 | P&F | 12/27/2021 | 12/27/2031 | 3.98% | 257571 | 288761 | 5370 |
| 817135 | Pasco | 1/14/2022 | 1/14/2032 | 3.98% | 667050 | 746733 | 3085 |
| 478098 | Lytle | 3/15/2022 | 3/15/2032 | 3.98% | 398275 | 444593 | 1898 |
| 663000 | Lytle | 3/15/2022 | 3/15/2042 | 3.98% | 621020 | 645392 | 11875 |
| 425000 | Kern | 3/22/2022 | 3/22/2042 | 3.98% | 398089 | 413713 | 7855 |
| 1275000 | Kern | 3/22/2022 | 3/22/2032 | 3.98% | 1062126 | 1185648 | 4688 |
| 246500 | Bartow | 5/18/2022 | 5/18/2042 | 3.98% | 232428 | 241429 | 5072 |
| 722500 | Bartow | 5/18/2022 | 5/18/2032 | 3.98% | 613737 | 683262 | 2754 |
| 382500 | Dietz | 6/15/2022 | 6/15/2032 | 3.98% | 328026 | 364708 | 1564 |
| 445981 | Aberdeen | 7/19/2022 | 7/29/2032 | 3.98% | 386120 | 428747 | 1786 |
| 1020000 | All Breed | 8/12/2022 | 8/12/2042 | 3.98% | 971173 | 1008039 | 8702 |
| 519527 | All Breed | 8/12/2022 | 8/12/2032 | 3.98% | 453984 | 503471 | 3159 |
| 225923 | All Breed | 8/12/2022 | 8/12/2032 | 5.25% | 198905 | 219347 | 3159 |
| 637500 | Williamsburg | 12/8/2022 | 12/8/2032 | 5.25% | 580834 | 637500 | 2556 |
| 850000 | Valley Vet | 11/8/2023 | 11/8/2033 | 5.25% | 843796 | 850000 | 3315 |
| $9713423 |  |  |  |  | $8621519 | $9309286 | $84424 |

---

The Company amortized $6,206 and $7,152 of issuance cost in the aggregate during the years ended December, 2024 and 2023, respectively, for the FNBD notes payable.

**FSB Commercial Loans**

The Company entered into three separate commercial loans with First Southern National Bank ("FSB") as part of the acquisition. The first commercial loan in the amount of $1,105,000 has a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan has monthly payments of $6,903 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $13,264 that was capitalized and is being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024 and required the lender to make monthly payments of $9,016 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of Kauai Veterinary Clinic ("KVC"), refer to Note 7 Business disposal for further detail.

The second commercial loan with FSB entered into on January 11, 2021 in the amount of $1,278,400 has a fixed interest rate of 4.35% and a maturity date of January 25, 2024. The fixed rate loan has monthly payments of $13,157 and a full payoff of the remaining principal balance at maturity. The commercial loan had issuance costs of $10,085 that was capitalized and is being amortized straight line over the life of the loan. The Company entered into a Forbearance Agreement that extended the maturity date to August 31, 2024 and required the Company to make monthly payments of $14,898 and increased the interest rate to 8.15% per annum. On September 20, 2024, this loan was assumed by Kauai RE Holdings LLC in the sale of Kauai Veterinary Clinic ("KVC"), refer to Note 7 Business disposal for further detail.

The third commercial loan with FSB entered into on January 11, 2021 in the amount of $450,000 has a fixed interest rate of 5.05% and a maturity date of September 11, 2021. The commercial loan was modified on August 25, 2021 to extend the maturity date to February 25, 2023 and increase the principal amount to $469,914. The fixed rate loan had monthly payments of $27,164 and was fully paid off on the maturity date. The commercial loan had issuance costs of $753 that was capitalized and is being amortized straight line over the life of the loan. This loan was paid in full in February 2023.

On October 31, 2022 the Company entered into three separate commercial loans with FSB as part of the Pony Express Practice acquisition. The first loan with FSB that was entered into on October 31, 2022, was in the amount of $2,086,921. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2025. The fixed rate loan has monthly payments of $23,138 except for a final monthly payment of $1,608,530. The commercial loan had issuance costs of $25,575 that was capitalized and is being amortized straight line over the life of the loan.

The second loan with FSB that was entered into on October 31, 2022, was in the amount of $400,000. The loan has a fixed interest rate of 5.97% and a maturity date of October 31, 2042. The fixed rate loan has monthly payments of $2,859. The commercial loan had issuance costs of $3,277 that was capitalized and is being amortized straight line over the life of the loan.

The third loan with FSB that was entered into on October 31, 2022, was in the amount of $700,000. The loan has a fixed interest rate of 6.75% and a maturity date of April 1, 2023. The fixed rate loan has monthly payments of $6,903 except for a final monthly payment of $423,278. The commercial loan did not have any issuance costs that were capitalized.

On December 16, 2022, the Company entered into two separate commercial loans with FSB as part of the Old 41 Practice acquisition. The first loan with FSB that was entered into on December 16, 2022, was in the amount of $568,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has monthly payments of $4,772 and a full payoff of the remaining principal balance at maturity. The loan had issuance costs of $4,531 that was capitalized and is being amortized straight line over the life of the loan.

The second loan with FSB that was entered into December 16, 2022, was in the amount of $640,000. The loan has a fixed interest rate of 6.50% and a maturity date of December 16, 2025. The fixed rate loan has twelve monthly payments of approximately $2,830, followed by monthly payments of $7,443. and the interest rate is 6.50%. The loan had issuance costs of $5,077 that was capitalized and is being amortized straight line over the life of the loan.

On November 8, 2023, the Company entered into a commercial loan with FSB as part of the Valley Vet acquisition. The loan with FSB was entered into on November 8, 2023, in the amount of $375,000. The loan has a fixed rate of 8.5% and a maturity date of November 8, 2024. The fixed rate loan has monthly payments of $3,255, except one final payment of the outstanding principal balance on the note, including any accrued and unpaid interest. The loan had issuance costs of $6,877 for the year ended December 31, 2023, that was capitalized and is being amortized straight line over the life of the loan.

The FSB commercial loans are guaranteed by Kimball Carr, the Company's Chief Executive Officer and President and Charles Stith Keiser, the Company's director and Chief Operating Officer.

Notes payable to FSB as of December 31, 2024 and 2023 consisted of the following:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Original**<br>**Principal** | <br>**Acquisition** | <br>**Entered** | <br>**Maturity** |<br>**Interest** | **December 31,**<br>**2024** | **December 31,**<br>**2023** | **Issuance**<br>**Cost** |
| $1105000 | KVC | 1/25/2021 | 2/25/2041 | 4.35% | $- | $997010 | $13264 |
| 1278400 | KVC | 1/25/2021 | 1/25/2031 | 4.35% |  | 960849 | 10085 |
| 469914 | KVC | 1/25/2021 | 2/25/2023 | 5.05% |  |  | 753 |
| 2086921 | Pony Express | 10/31/2022 | 10/31/2025 | 5.97% | 1733807 | 1902452 | 25575 |
| 400000 | Pony Express | 10/31/2022 | 10/31/2042 | 5.97% | 375943 | 387433 | 3277 |
| 700000 | Pony Express | 10/31/2022 | 8/16/2023 | 7.17% |  |  |  |
| 568000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 470227 | 520697 | 4531 |
| 640000 | Old 41 | 12/16/2022 | 12/16/2025 | 6.50% | 406641 | 623861 | 5077 |
| 375000 | Valley Vet | 11/8/2023 | 11/8/2024 | 8.50% | 375000 | 375000 | 6877 |
| $7623235 |  |  |  |  | $3361618 | $5767302 | $69439 |

---

The Company amortized $19,053 and $14,611 of issuance cost in the aggregate for the years ended December 31, 2024 and 2023 respectively, for the FSB notes payable.

Notes payable as of December 31, 2024 and 2023 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2024** | **December 31,**<br>**2023** |
| FNBD Notes Payable | $8621519 | $9309286 |
| FSB Notes Payable | 3361618 | 5767302 |
| Total notes payable | 11983137 | 15076588 |
| Unamortized debt issuance costs | (81909) | (124170) |
| Notes payable, net of issuance cost | 11901228 | 14952418 |
| Less current portion | (3410465) | (1469043) |
| Long-term portion | $8490763 | $13483375 |

---

Notes payable repayment requirements as of December 31, 2024, in the succeeding years are summarized as follows:

---

| | |
|:---|:---|
| 2025 | $3416965 |
| 2026 | 1203521 |
| 2027 | 872072 |
| 2028 | 909759 |
| 2029 | 950587 |
| Thereafter | 4630233 |
| Total | $11983137 |

---

**Bridge Note**

In December 2021, the Company entered into two bridge loans in the aggregate of $2,500,000 with Target Capital 1, LLC and Dragon Dynamic Catalytic Bridge SAC Fund as short term secured convertible notes ("Bridge Note"). The Bridge Note was convertible into the Company's common stock, at the time of a successful initial public offering ("IPO") at the noteholder's option, at a 35% discount to the IPO price. The Bridge Note had a face value of $2,500,000 with an original issue discount ("OID") of 12% and had a maturity date of January 24, 2023. The OID of $300,000 was amortized over the life of the loan. If the Company had not issued the Company's common stock in an initial public offering pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission ("SEC") and the listing of the common stock on a "national securities exchange" as defined in Section 6 of the Securities Exchange Act of 1934, as amended ("Qualified financing") by January 24, 2023 the conversion price will be set at a 40% discount to the IPO price. The Bridge Note was funded in two installments of net proceeds of $1,100,000 in December 2021 and the second installment January 2022. The Bridge Loan had issuance costs of $70,500 for the first installment and $54,000 for the second installment that is amortized straight line over the life of the loan. The Company amortized $0 of issuance cost for the year ended December 31, 2024 and 2023.

In conjunction with the Bridge Note the Company issued warrants on January 24, 2022 to Target Capital 1, LLC and Dragon Dynamic Catalytic Bridge SAC Fund (collectively the "Bridge Lenders"). The warrants entitled the Bridge Lenders to purchase the Company's Class A common stock, at a purchase price equal to the per share price in an IPO. The quantity of the Company's common stock of subject to purchase upon exercise of the warrants is equal to 50% of the face value of the Bridge Note, divided by the per-share price in the Qualified Financing, unless a Qualified Financing had not been completed by January 24, 2023 in which case the quantity of Class A common stock subject to purchase upon exercise of the warrants will be an amount equal to 75% of the face value of the Bridge Note divided by the per-share price in the Qualified Financing. If a Qualified Financing has not consummated or the Bridge Note had not been repaid in full on or before January 24, 2027, then the quantity of common stock subject to purchase upon exercise of the warrants will be an amount equal to 100% of the face value divided by the per-share price equal to the fair market value of one share of Class A common stock as mutually agreed by the Holder and the Company. The warrants were exercisable through the fifth anniversary of the issuance date. The warrants could be redeemed at the option of the Company at any time following a Qualified Financing if the Company's common stock trade on a national securities exchange at a price equal to the purchase price of the Company's common stock in the Qualified Financing multiplied by 2 for a period of ten consecutive trading days.

On November 18, 2022, the Company entered into an Original Issue Discount Secured Convertible Note loan ("bridge loan") with Target Capital 1, LLC for $1,136,364. The note is issued at an original issue discount of 12% with an maturity date on the earlier of March 31, 2023 ("Initial Maturity Date") or the Company's sale of its Common Stock in an initial public offering pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission and the listing of the Common Stock on a "national securities exchange" as defined in Section 6 of the Securities Exchange Act of 1934, as amended ("Qualified Financing" or the "Maturity Date"). The note bears an interest rate of 12% per annum by means of the original issue discount. Upon the occurrence of an Automatic Extension, this note shall commence to accrue interest at an interest rate of 12% percent per annum on the date of the commencement of the Automatic Extension until the note is converted or is paid in full. The Company may pay the full principal amount of this note, and all accrued but unpaid interest at any time prior to the Maturity Date without the prior written consent of the Holder in the principal amount of $1,136,364, plus all accrued but unpaid interest, multiplied by 120%. In addition, and to the extent the Company is required to pay this note in cash at the on or after the Initial Maturity Date due to, upon the closing date of a Qualified Financing, the Company shall pay to the Holder $1,136,364, plus all accrued unpaid interest, multiplied by 120%. Upon the occurrence and during the continuation of an Event of Default, until the Event of Default is cured, or the Note is repaid in full, Company will pay 20% of its total gross revenues (including that of all its subsidiaries) monthly, which shall be applied to payment of principal and interest under this this note. The conversion price (the "Conversion Price") shall be equal to the price paid by the public in the Company's Qualified Financing multiplied by 0.65 (or 0.60, from and after any Automatic Extension).

In conjunction with the Original Issue Discount Secured Convertible Note with Target Capital 1, LLC the company issued the holder 412 shares of Class A Common Stock and equity classified warrants that entitle the holder to purchase the Company's common stock at a purchase price equal to the per share price in an IPO. The quantity of the Company's common stock of subject to purchase upon exercise of the warrants is equal to 75% of the face value of the Bridge Note, divided by the per-share price in the Qualified Financing.

On November 18, 2022, the Company entered into an Original Issue Discount Secured Convertible Note with 622 Capital LLC for $568,182. The note is issued at an original issue discount of 12% with an maturity date on the earlier of January 24, 2023 ("Initial Maturity Date") or the Company's sale of its Common Stock in an initial public offering pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission and the listing of the Common Stock on a "national securities exchange" as defined in Section 6 of the Securities Exchange Act of 1934, as amended ("Qualified Financing" or the "Maturity Date"). If the Company has filed its Form S-1 Registration Statement with the SEC on or prior to the Initial Maturity Date but the Qualified Financing has not closed by such date ("Automatic Extension") then all principal and accrued interest under this Note shall become due and payable in cash on July 24, 2023 (the "Final Maturity Date") or such earlier date as this Note is required be repaid. The note bears an interest rate of 12% per annum by means of the original issue discount. Upon the occurrence of an Automatic Extension, this note shall commence to accrue interest at an interest rate of 12% percent per annum on the date of the commencement of the Automatic Extension until the note is converted or is paid in full. The Company may pay the full principal amount of this note and all accrued but unpaid interest at any time prior to the Maturity Date without the prior written consent of the Holder in the principal amount of $568,182, plus all accrued but unpaid interest, multiplied by 120%. In addition, and to the extent the Company is required to pay this note in cash at the on or after the Initial Maturity Date due to, upon the closing date of Qualified Financing, the Company shall pay to the Holder $568,182, plus all accrued unpaid interest, multiplied by 120%. Upon the occurrence and during the continuation of an Event of Default, until the Event of Default is cured or the Note is repaid in full, Company will pay 20% of its total gross revenues (including that of all its subsidiaries) monthly, which shall be applied to payment of principal and interest under this this note. The conversion price (the "Conversion Price") shall be equal to the price paid by the public in the Company's Qualified Financing multiplied by 0.65 (or 0.60, from and after any Automatic Extension).

In conjunction with the Original Issue Discount Secured Convertible Note with 662 Capital LLC the company issued the holder equity classified warrants that entitle the holder to purchase the Company's common stock at a purchase price equal to the per share price in an IPO. The quantity of the Company's common stock of subject to purchase upon exercise of the warrants is equal to 50% of the face value of the Bridge Note, divided by the per-share price in the Qualified Financing, unless a Qualified Financing has not been completed by March 31, 2023 in which case the quantity of Class A common stock subject to purchase upon exercise of the warrants will be an amount equal to 75% of the face value of the Bridge Note divided by the per-share price in the Qualified Financing.

The warrants were deemed legally detachable from the Bridge Note and were fair valued using the Black Scholes Method to determine the relative fair values of the Bridge Note and the detachable warrants. The significant inputs for the Black Scholes calculation included the exercise price and common share price of $0.44, volatility rate of 27% and risk-free rate of 1.53% with a 5-year term. The proceeds received for the Bridge Note were allocated to the detached warrants based on the relative fair values. Pursuant to ASC 470 the relative fair value of the warrants attributable to a discount on debt is $429,284; this is amortized to interest expense on a straight-line basis over the term of the loan.

A roll forward of the bridge note for the year ended December 31, 2023, is below:

---

| | |
|:---|:---|
| Bridge notes, December 31, 2021 | 1031917 |
| Issued for cash | 2600000 |
| Amortization of original issue discount | 386245 |
| Warrant discount | (429284) |
| Amortization of warrant discount | 303309 |
| Debt issuance costs | (164000) |
| Amortization of debt issuance costs | 170969 |
| Bridge notes, December 31, 2022 | 3899156 |
| Amortization of original issue discount | 116656 |
| Amortization of warrant discount | 125975 |
| Amortization of debt issuance costs | 62758 |
| Extinguishment of bridge notes in exchange for Series A preferred stock upon IPO on August 31, 2023 | (4204545) |
| Bridge notes, December 31, 2023 | $- |

---

On June 30, 2023, the Company entered into exchange agreements (the "Exchange Agreements") with each of the Company's Bridge Note lenders, pursuant to which the lenders exchanged their existing Bridge Notes for 299 shares, 3,528 shares, and 598 shares, respectively, of Convertible Series A preferred stock (4,425 shares of Convertible Series A Preferred stock in total) (the "Exchange"). The Exchange Agreements will be deemed rescinded and the former Bridge Notes will be deemed reinstated if the Company doesn't complete an initial public offering by September 1, 2023. Upon the IPO completing on August 31, 2023, the Company recognized the extinguishment of the Bridge Notes pursuant to ASC 470 and recognized a debt extinguishment loss of $16,105. The Company recognized a beneficial conversion feature of $2,567,866 for the issuance of the Series A preferred stock on the date of the IPO due to the $4 (Pre-Reverse Split) offering price related to the IPO being known as of that date.

**Convertible Debenture**

Between March 18 and December 28, 2021, the Company issued $2,102,500 in aggregate principal amount of 6.00% subordinated convertible promissory note ("Convertible Debenture"). During the year ending December 31, 2022 the Company issued $1,612,000 in aggregated principal amount of the 6.00% Convertible Debenture. In March 2023 the Company issued an additional $650,000 in aggregate principal amount of 6.00% Convertible Debenture notes to five (5) separate holders. The Convertible Debenture is convertible into the Company's Class A Common Stock upon the Company's offering for sale its shares in a public offering ("IPO"). At the holder's election, the accrued interest and principal may be paid in cash or Class A Common Stock (such number of shares reflecting a twenty-five percent (25%) discount of the opening price per share of Class A Common Stock). The Convertible Debenture mature 5 years from the date of issuance to each holder. Prior to the maturity date, the holder is entitled to convert the Convertible Note into Class A Common Stock upon the Company's IPO. Upon an IPO the accrued and unpaid interest is due and payable in cash on the first business day of the following month of March for any balance not elected to be converted into the Class A Common Stock. The Convertible Debenture principal balance was $100,000 and $3,714,500 as of December 31, 2023 and 2022. The Convertible Debenture incurred issuance cost of $40,000 that is amortized straight line over the life of the Convertible Debenture. The Company amortized $0 and $7,996 for the years ended December 31, 2024 and 2023.

Upon the Company's IPO closing on August 31, 2023, the majority of Convertible Debenture holders elected convert an aggregate of $4,014,500 of principal and $399,818 of accrued interest into 598 shares of Class A common stock at a conversion price of $3.00 per share. The Company recorded a beneficial conversion feature as of the date of the conversion of $1,569,395 based on the PO price of $10,000 per share minus the principal and accrued interest of the Convertible Debenture balance converted into common stock. Four holders of the Convertible Debenture with an aggregate principal balance of $250,000 elected to be paid back in cash and one investor with a principal balance of $100,000 elected to be paid on February 28, 2024 including accrued interest through the date of payment at 6%.

**Loan Payable**

On May 30, 2023, the Company entered into a Merchant Cash Advance Agreement for gross proceeds of $1,050,000 with an unrelated third-party financial institution. Under the terms of the agreement, the Company must pay $57,346 each week for 26 weeks with the first payment being due June 6, 2023. The financing arrangement has an effective interest rate of 49%. The financing arrangement includes an original issuance discount ("OID") of $441,000 and issuance costs of $50,000. The OID and issuance cost associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and is amortized using the effective interest method.

On August 10, 2023, the Company amended the financing arrangement to borrow an additional $507,460 resulting in the weekly repayments increasing to $76,071 to be paid over 28 weeks. This amendment decreased the effective interest rate to 41%. The refinancing resulted in a loss on debt modification of $441,618.

On November 28, 2023, the Company amended the financing arrangement to borrow an additional $531,071 resulting in the weekly payments to decrease to $56,800 to be paid over 40 weeks. This amendment increased the effective rate to 49%. The refinancing resulted in a loss on debt modification of $485,436.

On January 18, 2024, the Company amended the financing arrangement to borrow an additional $549,185 resulting in the weekly payments to increase to $86,214 to be paid over 43 weeks. This amendment increased the effective interest rate to 52%. The refinancing resulted in a loss on debt modification of $728,278.

On May 7, 2024, the Company amended the financing arrangement to borrow an additional $518,750 resulting in the weekly payments to increase to $90,229 to be paid over 48 weeks. This amendment decreased the effective interest rate to 49%. The refinancing resulted in a loss on debt modification of $859,584.

On December 24, 2024, the Company amended the financing arrangement to borrow an additional $513,650 resulting in the weekly payments to increase to $71,995 to be paid over 41 weeks. This amendment decreased the effective interest rate to 43%. The refinancing resulted in a loss on debt modification of $546,356.

On April 4, 2024, the Company entered into a new financing agreement for gross proceeds of $420,000 with a different unrelated third-party financial institution. Under the terms of the agreement, the Company must pay $21,600 each week for 28 weeks with the first payment being due April 8, 2024. The financing arrangement has an effective interest rate of 51%. The financing arrangement includes an original issuance discount ("OID") of $184,800 and issuance costs of $20,000. The OID and issuance cost associated with the financing arrangement are presented in the balance sheets as a direct deduction from the carrying amount of the financing arrangement and is amortized using the effective interest method.

During the year ended December 31, 2024, the Company amortized $1,624,333 of OID and issuance cost included in interest expense on the statement of operations. During the year ended December 31, 2024, the Company made $4,509,147 in payments on the loan payable. The outstanding balance of the loan payable as of December 31, 2024, is $2,340,020. The financing arrangement is secured by an interest in virtually all assets of the Company with a first security interest in accounts receivable. The financing arrangement is guaranteed by the Company's CEO.

During the year ended December 31, 2023, the Company amortized $671,719 of OID and issuance cost included in interest expense on the statement of operations. During the year ended December 31, 2023, the Company made $1,923,474 in payments on the loan payable. The outstanding balance of the loan payable as of December 31, 2023, is $2,063,058. The financing arrangement is secured by an interest in virtually all assets of the Company with a first security interest in accounts receivable. The financing arrangement is guaranteed by the Company's CEO.

**Convertible Notes Payable**

On March 26, 2024, Inspire entered into a securities purchase agreement (the "Purchase Agreement") with a certain investor. Pursuant to the Purchase Agreement, Inspire issued to investors Increasing OID Senior Note ("Convertible Note Payable") for $500,000. The Convertible Note Payable has a maturity date of the earlier of December 26, 2024 or the consummation of a capital raise (the "Maturity Date").

On June 11, 2024, Inspire entered into a securities purchase agreement (the "Purchase Agreement") with two investors. Pursuant to the Purchase Agreement, Inspire issued to investors Increasing OID Senior Note ("Convertible Note Payable") for $250,000 each. The Convertible Note Payable has a maturity date of the earlier of February 11, 2025 or the consummation of a capital raise (the "Maturity Date").

The Convertible Notes Payable contain an original issue discount ("OID") which shall be: (i) fifteen percent (15%) if the Convertible Notes Payable is satisfied and paid in full on or before the forty-fifth (45th) day after the Original Issue Date (as such term is defined in the Notes), (ii) twenty percent (20%) if the Convertible Notes Payable is satisfied and paid in full after such 45th day but on or before the ninetieth (90th) day after the Original Issue Date, and (iii) thirty percent (30%) after such 90th day. The Convertible Notes Payable can be prepaid at any time prior to the Maturity Date without any penalties.

The Convertible Notes Payable must be repaid in full from any future capital raises (debt, equity or any other form of capital raise) of Inspire. All of the funds raised must be used to repay the Convertible Notes Payable until the Convertible Notes Payable are repaid in full.

The Convertible Notes Payable are convertible into shares of common stock of Inspire, in full or in part, at any time after issuance at the discretion of the noteholder at a fixed conversion price of $0.75 per share (the "Fixed Conversion Price").

If the Convertible Notes Payable is not repaid by the Maturity Date the default provisions are as follow: (i) The Face Value (as such term is defined in the Convertible Notes Payable) of the Convertible Notes Payable will increase by 20% (to a 50% OID -- $1,000,000 Face Value); (ii) the conversion price of the Convertible Notes Payable will become convertible at the lower of (a) the Fixed Conversion Price or (b) 20% discount to a 3-Day volume-weighted average price (the "Default Conversion Price").

As of December 31, 2024 the balance of the convertible notes payable was $0. During the year ended December 31, 2024 the Company paid off $392,857 of the notes payable and accrued interest and converted $1,357,143 into 226,249 shares of class A common stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **Related Party Transactions** 

**Blue Heron**

The Company entered into a consulting agreement with Blue Heron Consulting ("BHC") on June 24, 2021, pursuant to which BHC will consult with the Company on an on-going basis in connection with the Company's acquisition of veterinary practices throughout the United States and will serve as the Company's business and financial advisor with respect to its acquisition strategy and in connection with specific acquisition targets. The Company's director and Chief Operating Officer Charles Stith Keiser is the Chief Operating Officer of BHC, and the Company's director Dr. Charles "Chuck" Keiser is the Chief Visionary Officer of BHC.

Under the Consulting Agreement, BHC is entitled to a monthly fee for on-going services including:

● the preparation of valuation packages of potential acquisitions (including the gathering of pertinent information, financial and background data, completion of deal packets and financial projection worksheets used by the Company to calculate practice values);

● the institution of turnover protocols and procedures of hospitals immediately post-purchase; systems reporting; the formulation of individual hospital goals and targets;

● on-going monthly support of hospital units (including medical and operational coaching, business growth projections, establishment of financial targets and margin improvements, growth milestones) and recruiting support.

During the fourth quarter of 2023 management terminated the service agreement with Blue Heron. The Company continues to use BHC for ad hoc services following the termination of the agreement that is billed based on services provided. The Company has incurred $83,168 and $907,866 in expenses for the years ended December 31, 2024, and 2023, respectively. These expenses are recorded as a component of "General and administrative expenses" in the accompanying consolidated statement of operations.

**Star Circle Advisory**

The Company entered into a consulting agreement with Star Circle Advisory Group, LLC ("Star Circle") on August 2, 2022, to serve as financial consultant, on a non-exclusive basis, to assist with arranging bridge financing and the initial public offering of the Company. Star Circle is owned and controlled by Kimball Carr, Chief Executive Officer ("CEO"), Peter Lau, former Interim Chief Financial Officer and Director, James Coleman, Director, and Richard Marten, Director. Star Circle is entitled to a monthly fee of $33,000, payable monthly. Each party is responsible for its own ordinary office and personnel expenses; however, Star Circle is entitled, with prior written consent from the Company, for reimbursement for required extraordinary expenses including air travel, lodging, and Company filing fees. The consulting agreement will terminate on August 1, 2024, unless terminated earlier by mutual agreement of the parties or by either party upon 30 days written notice. The consulting agreement may also be extended by mutual agreement. Prior to the formal agreement between the Company and Star Circle, Star Circle provided the same services under a verbal agreement that was memorialized by the consulting agreement. During the fourth quarter of 2023 management terminated the service agreement with Star Circle Advisory. The Company has incurred $0 and $284,900 in expenses for the years ended December 31, 2024 and 2023. These expenses are recorded as a component of "General and administrative expenses" in the accompanying consolidated statement of operations.

**Chief Executive Officer's Warrant**

On January 1, 2023, the board of directors issued 500 warrants of Class A common stock issuable upon cashless exercise of a warrant granted to Kimball Carr, our CEO, in consideration for his personal guaranty of the Company loans. The warrant expires on January 1, 2028. The Warrant is fully paid and nonassessable shares of Class A common stock at a purchase price per share equal of $4. The warrants were measured at fair value using the Black Scholes Method to determine the fair value of warrants issued to the CEO. The significant inputs for the Black Scholes calculation included the exercise price and common share price of $1.73, volatility rate of 27.13% and risk-free rate of 3.94% with a 5-year term. The warrants were valued at $2,701 at the time of issuance and the entire amount was recorded as an expense in General and administrative expenses in the accompanying consolidated statement of operations for the year ended December 31, 2023.

**Sale of KVC**

On September 20, 2024, KVC sold Kauai Veterinary Clinic ("KVC") to Kauai RE Holdings LLC. The agent for the sale was Gregory Armstrong, a current shareholder of the Company and a member of Kauai RE. Charles Keiser, DVM, is a member of Kauai RE and the father of our board member Charles Stith Keiser, who is the Company's largest shareholder through his entity Wilderness Trace Veterinary Partners, LLC, refer to Note 7 Business disposal for further detail.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **Stockholders' Equity** 

The Company is authorized to issue 25,000,000 shares, of which 4,000,000 shares are designated as Class A common stock, with a par value of $0.0001 per share (the "Class A Common Stock"), 20,000,000 shares are designated as Class B common stock, with a par value of $0.0001 per share (the "Class B Common Stock"), and 1,000,000 shares are designated as Preferred Stock, with a par value of $0.0001 per share (the "Preferred Stock").

Each outstanding share of Class A Common Stock is entitled to vote on each matter on which the stockholders of the Company is entitled to vote, and each holder of Class A Common Stock is entitled to one (1) vote for each share of Class A Common Stock held by such holder.

Each outstanding share of Class B Common Stock is entitled to vote on each matter on which the stockholders of the Company is entitled to vote, and each holder of Class B Common Stock is entitled to twenty-five (25) votes for each share of Class B Common Stock held by such holder.

All shares of Class A Common Stock and Class B Common Stock (collectively "Common Stock") will be identical and will entitle the holders thereof to the same rights and privileges, except as otherwise provided above.

On November 15, 2022, the Company amended the consulting agreement with Alchemy Advisory, LLC until June 30, 2023. The contract amendment stipulates an additional fee of $40,000 as well as 33 restricted shares of the Company's Class A Common Stock. The Company recorded the $144,168 fair value of the common stock with $0 and $108,126 expensed during the years ended December 31, 2024 and 2023, respectively. The Company amortizes the cost of the common stock issued over the life of the agreement.

On November 15, 2022, the Company entered into a consulting agreement with 662 Capital LLC. The contract stipulates the Company will issue 17 restricted shares of the Company's Class A Common Stock for services rendered. The Company recorded the $72,084 fair value of the common stock with $0 and $54,063 expensed during the years ended December 31, 2024 and 2023, respectively. The Company amortizes the cost of the common stock issued over the life of the agreement.

**Convertible Series A preferred stock**

On June 30, 2023, the Company amended its articles of incorporation by the filing of a certificate of designation for the Series A preferred stock. One million shares of the Series A Preferred stock are authorized under the Series A Certificate of Designation, with each such having a stated value of $10.00 per share, with a par value of $0.0001. The Series A preferred stock earns a dividend rate equal to 12% of the stated rate per annum, which such dividend may be payable either in cash or in-kind at the sole option of the Company.

Holders of shares of the Series A preferred stock are entitled to a liquidation preference in the event of any dissolution, liquidation or winding up of the Company equal to the stated value plus any accrued and unpaid dividends on such stock. Holders of shares of Series A preferred stock are also entitled to convert such shares at any time and from time, at the option of such holder, into a number of shares of Class A common stock equal to the stated value divided by a conversion price. The conversion price is equal to 60% of the dollar volume-weighted average price for shares for the Company's Class A common stock for the three trading days immediately preceding the date of the conversion. However, the conversion price can never be less than 50% of the per-share price for shares of Class A common stock during the Company's initial public offering. For any conversion during the Company's initial three days of market trading, the conversion price will be equal to 60% of the price for the Company's underwritten initial public offering.

On November 7, 2023, the Company amended its article of incorporation to increase the total authorized preferred stock by 2,000,000 shares.

The conversion price of the convertible series A preferred stock to be no less than $1.00 per share, as adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction conducted after the date of the series A preferred stock amendment.

The holders of the Series A preferred stock have the right to vote on all matters submitted to a vote of shareholders on an as-if-converted basis together with the holders of shares of the Company's Class A and Class B common stock, voting together as a single class.

On June 30, 2023, the Company issued 442 shares of Series A preferred stock to the holders of the Bridge Notes in exchange for the Bridge Notes (the "Exchange").

In connection with the Exchange, the Company also issued warrants (the "New Warrants") to purchase additional shares of Class A common stock. The New Warrants were issued in exchange for the existing warrants held by the former Bridge Note holders. The exercise price of the shares to be issued pursuant to the New Warrants is the price of the shares of Class A common stock to be issued in this offering. The number of shares to be issued upon exercise of the New Warrants is equal to the quotient of 75% of the outstanding Series A preferred stock value divided by the exercise price. Also, in connection with the Exchange, the Company entered into new registration rights agreements (the "New Registration Rights Agreements") with each of holders, pursuant to which the Company has agreed to register the public resale of the shares of Class A common stock issuable upon conversion of the Series A preferred stock and upon exercise of the under the New Warrants. The New Registration Rights Agreements supersede in their entirety the prior registration rights agreements with the former senior secured lenders. If the Company does not close this offering on or before September 1, 2023, the Exchange Agreements will be deemed rescinded, and the former Bridge Notes will be deemed reinstated. As the offering was outside the control of the Company the Company did not recognize the full extinguishment of the Bridge Notes until the IPO was completed on August 31, 2023. The Company recognized a beneficial conversion feature of $2,567,866 for the issuance of the Series A preferred stock on the date of the IPO due to the $4 offering price related to the IPO being known as of that date.

As of December 31, 2024 all of the convertible Series A preferred stock has been converted and there are no remaining shares outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **Stock Compensation** 

Effective October 18, 2022, the Board of Directors of Inspire Veterinary Partners adopted the 2022 Equity Incentive Plan, (the "2022 Plan"). The plan provides for the award of stock options (incentive and non-qualified), stock awards and stock appreciation rights to officers, directors, employees and consultants who provide services to the Company. The number of shares issued may not exceed, at any given time, ten percent (10%) of the total of: (a) the issued and outstanding shares of the Company's common stock, and (b) all shares common stock issuable upon conversion or exercise of any outstanding securities of the Company which are convertible or exercisable into shares of common stock. The Stock Option Plan expires on October 18, 2032.

The Company recognizes stock-based compensation expense from stock-based payments using the grant date fair-value, including for stock options. The fair value of options awarded to employees is measured on the grant date using the Black-Scholes option-pricing model and is recognized as an expense over the requisite service period on a straight-line basis.

All stock options are exercisable into class A common stock.

The following is a summary of outstanding stock options as of December 31, 2024 and 2023:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of Shares** | **Weighted<br> Average<br> Exercise<br> Price** | **Weighted Average Remaining Life(years)** | **Aggregate Intrinsic Value** |
| **Options outstanding as of December 31, 2022** | **-** | $**-** | **-** | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;Issued |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Expired and forfeited | **-** |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | - | - | - | - |
| **Options outstanding as of December 31, 2023** | **-** | $**-** | **-** | $- |
| **Options exercisable as of December 31, 2023** | **-** | $**-** | **-** | - |
| **Options outstanding as of December 31, 2023** | **-** | $**-** | **-** | $- |
| &nbsp;&nbsp;&nbsp;Issued | 236469 | 1.36 | 10.0 |  |
| &nbsp;&nbsp;&nbsp;Expired and forfeited |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercised | - | - | - | - |
| **Options outstanding as of December 31, 2024** | **236469** | $**1.36** | **9.74** | $**-** |
| &nbsp;&nbsp;&nbsp;**Options exercisable as of December 31, 2024** | **236469** | $**1.36** | **9.74** | $- |

---

The following is the vesting terms associated with those shares:

---

| | | | |
|:---|:---|:---|:---|
| **Tranche** | **Shares<br> Granted** | **Vesting <br> Method** | **Vesting Terms** |
| Tranche 1 | 236469 | Straight-line | The vesting date is immediate and is fully vested on the grant date |
| Total | 236469 |  |  |

---

The Black-Scholes option-pricing model includes the following weighted average assumptions to determine the grant share-based awards:

---

| | | |
|:---|:---|:---|
|  | **Years Ended December 31,** | **Years Ended December 31,** |
|  | **2024** | **2023** |
| **Assumptions:** |  |  |
| Risk-free interest rate | 3.49-3.55% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-% |
| &nbsp;&nbsp;&nbsp;Expected dividend yield | -% | -% |
| &nbsp;&nbsp;&nbsp;Expected volatility | 51.14-52.38% | -% |
| &nbsp;&nbsp;&nbsp;Expected life (in years) | 5.00-5.46 |  |

---

During the years ended December 31, 2024 and 2023, the Company recognized stock-based compensation from options of $23,647 and $0, respectively. As of December 31, 2024, there was $0 in unrecognized stock-based compensation related to unvested stock options.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **Retirement Plan** 

During the year ending December 31, 2022, the Company implemented a qualified 401(K) retirement plan. The Company offers eligible domestic full-time employees participation in certain 401K plans. The plans provide for a discretionary annual company contribution. In addition, employees may contribute a portion of their salary to the plans, which certain of the 401K plans, is partially matched by the Company. The plans may be amended or terminated at any time. The Company contributed and expensed approximately $148,207 and $124,166 during the years ended December 31, 2024 and 2023, respectively.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.** **Income Taxes** 

The Company estimated NOL carry-forwards for Federal and State income tax purposes of $30,078,801 and $23,232,961 as of December 31, 2024, respectively, and $14,924,318 for both federal and state as of December 31, 2023. No tax benefit was reported with respect to these NOL carry-forwards in the accompanying financial statements because the Company believes the realization of the Company's deferred tax assets was not considered more likely than not to be realized and accordingly, the potential tax benefits of the deferred tax assets are fully offset by a full valuation allowance. The Company's deferred tax assets and liabilities as of December 31, 2024 and 2023 are as follows:

---

| | | |
|:---|:---|:---|
|  | **Year ended December 31,** | **Year ended December 31,** |
|  | **2024** | **2023** |
| Deferred tax assets: |  |  |
| Net Operating Loss Carryforwards | $7388670 | $3684694 |
| Accrued Expenses | 76922 | 112936 |
| Stock Based Compensation | 5667 | 98625 |
| Charitable Contribution Carryforward | 600 | 621 |
| ROU Asset | (450486) | (400605) |
| Lease Liability | 509858 | 410405 |
| R&D Sec 174 | 1376 | 1830 |
| &nbsp;&nbsp;&nbsp;**Total deferred tax assets** | 7532607 | 3908505 |
| Deferred tax liabilities: |  |  |
| Amortization/Depreciation | 60469 | 89165 |
| &nbsp;&nbsp;&nbsp;**Total deferred tax liabilities** | 60469 | 89165 |
| Valuation allowance | (7472138) | (3819340) |
| Net deferred Tax Assets (Liabilities) | $- | - |

---

The differences between the total calculated income tax (benefit) provision and the expected income tax computed using the U.S. federal income tax rate are as follows:

---

| | | |
|:---|:---|:---|
|  | **2024** | **2023** |
| Tax benefit at statutory tax rate | (2933037) | (2872031) |
| State benefit, net of federal benefit | (511292) | (210273) |
| Beneficial conversion feature |  | 868825 |
| Other permanent differences | 27484 | 3713 |
| Valuation allowance | 3652798 | 2209897 |
| Prior Period Adj | (235953) | (131) |
|  | $- | $- |

---

Income tax benefit consists of the following for the years ending December 31, 2024 and 2023:

---

| | | |
|:---|:---|:---|
|  | **December 31 2024** | **December 31 2023** |
| Current income benefit expense |  |  |
| &nbsp;&nbsp;&nbsp;Federal | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;State | - | - |
|  | $- | $- |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.** **Leases** 

*Accounting for Leases as Lessee*

The Company determines if an arrangement is a lease at inception. Operating leases are included in right-of-use assets ("ROU"), operating lease liabilities, and operating lease liabilities, non-current. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. None of the leases entered into have an implicit rate, the Company uses its incremental borrowing rate based on the information available at lease commencement date in determining the present value of future payments. Incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. The ROU assets also include any prepaid lease payments made and initial direct costs incurred and exclude lease incentives. The Company's lease terms may include options to extend or terminate the lease, which is recognized when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet.

The Company has operating leases for real estate. The Company has certain intercompany leases between its subsidiaries, and these transactions and balances have been eliminated in consolidation and are not reflected in the tables and information presented below.

The components of lease expense included on the Company's consolidated statements of operations were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Expense Classification** | **For the Year Ended December 31,** | **For the Year Ended December 31,** |
| **Operating lease expense:** |  | **2024** | **2023** |
| Amortization of ROU asset | &nbsp;&nbsp;General and administrative | $215231 | $132138 |
| Accretion of Operating lease liability | &nbsp;&nbsp;General and administrative | 45613 | 25667 |
| &nbsp;&nbsp;&nbsp;Total operating lease expense |  | $260844 | $157805 |
| Other lease expense | &nbsp;&nbsp;General and administrative | 61408 | 28012 |
| &nbsp;&nbsp;&nbsp;Total |  | $322252 | $185817 |

---

Other information related to leases is as follows:

---

| | | |
|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** |
|  | **2024** | **2023** |
| Remaining lease term: |  |  |
| &nbsp;&nbsp;&nbsp;Operating leases (in years) | 8.77 | 9.29 |
| Discount rate: |  |  |
| &nbsp;&nbsp;&nbsp;Operating leases | 7.25% | 7.03% |

---

Amounts relating to leases were presented on the consolidated balance sheets as of December 31, 2024 and 2023 in the following line items:

---

| | | | |
|:---|:---|:---|:---|
|  | **Balance Sheet Classification** | **Year Ended December 31,** | **Year Ended December 31,** |
| **Assets:** |  | **2024** | **2023** |
| Operating lease assets | &nbsp;&nbsp;Right-of-use assets | $1879729 | $1616198 |
| **Liabilities:** |  |  |  |
| Operating lease liabilities | &nbsp;&nbsp;Operating lease liabilities | 183981 | 141691 |
| Operating lease liabilities | &nbsp;&nbsp;Operating lease liabilities, non-current | 1943487 | 1514044 |
| Total lease liabilities |  | $2127468 | $1655735 |

---

The future minimum lease payments required under leases as of December 31, 2024, were as follows:

---

| | |
|:---|:---|
| **Fiscal Year** | **Operating<br> Leases** |
| 2025 | $333200 |
| 2026 | 312299 |
| 2027 | 316369 |
| 2028 | 323311 |
| 2029 | 336045 |
| Thereafter | 1332102 |
| &nbsp;&nbsp;&nbsp;Undiscounted cash flows | 2953326 |
| Less: imputed interest | (825858) |
| &nbsp;&nbsp;&nbsp;Lease liability | $2127468 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.** **Commitments and Contingencies** 

As of December 31, 2024, substantially all of the Company's assets were pledged as collateral for the Company's credit facilities.

**Common Stock Purchase Agreement**

On November 30, 2023, the Company entered into a common stock purchase agreement with a 3<sup>rd</sup> party investor (the "Investor"), to which the investor committed to purchase up to $30 million of the Company's Class A common stock.

Under the terms and subject to the conditions of the Purchase Agreement, the Company has the right, but not the obligation, to sell to the Investor, and the Investor is obligated to purchase, shares of Class A Common Stock in an amount up to $30 million. Such sales of Class A Common Stock by the Company, if any, will be subject to certain limitations, and may occur from time-to-time in the Company's sole discretion, over the period commencing once certain customary conditions are satisfied, including the filing and effectiveness of a resale registration statement with the U.S. Securities and Exchange Commission (the "Commission") with respect to the shares to be sold to the Investor under the Purchase Agreement and ending on the first day of the month following the 24-month anniversary of the date on which the resale registration statement is declared effective by the Commission. The Investor has no right to require the Company to sell any shares of Class A Common Stock to the Investor, but the Investor is obligated to purchase shares of Class A Common Stock pursuant to a valid purchase notice delivered by the Company, subject to certain conditions and limitations.

Purchase Price

The shares of Class A Common Stock to be issued by the Company and purchased by the Investor will be sold at a purchase price equal to 95% of the lowest daily volume-weighted average price of the Class A Common Stock on the Nasdaq Capital Market (or any eligible substitute exchange) during the three consecutive trading days immediately following the trading date on which a valid purchase notice is delivered to the Investor by the Company. Such purchase price will be adjusted for reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction by the Company with respect to its Class A Common Stock.

Actual sales of shares of Class A Common Stock to the Investor will depend on a variety of factors to be determined by the Company from time-to-time, including, among other things, market conditions, the trading price of the Company's Class A Common Stock, and the working capital needs, if any, of the Company.

The net proceeds from sales, if any, under the Purchase Agreement to the Company will depend on the frequency and prices at which the Company sells shares of Class A Common Stock to the Investor. the Company expects that any proceeds received by the Company from such sales to the Investor will be used for working capital and general corporate purposes.

Purchase Limits

Pursuant to the Purchase Agreement, the Company may not require the Investor to purchase, and the Investor will have no obligation to purchase, shares of Class A Common Stock in excess of a number equal to the lowest of (i) 100% of the average daily trading volume of the Class A Common Stock on the Nasdaq Capital Market (or any other eligible national stock exchange, as applicable) for the five consecutive trading days immediately prior to the trading date on which a valid purchase notice is delivered to the Investor, (ii) a 30% discount to the daily trading volume in the Class A Common Stock on the Nasdaq Capital Market (or any other eligible national stock exchange, as applicable), and (iii) $2 million divided by the volume-weighted average price for the Class A Common Stock on the trading day immediately prior to the trading date on which a valid purchase notice is delivered to the Investor.

Consistent with certain applicable Nasdaq rules, the Company may not issue to the Investor more than 12,143 shares of its Class A Common Stock (the "Exchange Cap") under the Purchase Agreement, which number of shares is equal to 19.99% of the shares of the Company's Class A Common Stock issued and outstanding immediately prior to the execution of the Purchase Agreement, unless the Company obtains stockholder approval to issue shares of its Class A Common Stock in excess of such limit in accordance with applicable rules of Nasdaq or any other applicable national stock exchange.

Fees

As consideration for the Investor's irrevocable commitment to purchase shares of Class A Common Stock, upon execution of the Purchase Agreement, the Company became obligated to issue to the Investor a number of shares of Class A Common Stock equal to $600,000 divided by the average daily volume-weighted average price for the Class A Common Stock on the Nasdaq Capital Market during the five consecutive trading days ending on the trading date immediately prior to the Company's filing of an initial registration statement pursuant to the Registration Rights Agreement described below. In certain circumstances, the Company may become obligated to pay to the Investor a cash fee equal to $600,000 in lieu of issuing such shares of Class A Common Stock, under the terms and subject to the conditions described more fully in the Purchase Agreement.

Certain Representations, Warranties and Covenants

The Purchase Agreement contains customary representations, warranties, conditions, and indemnification obligations of each of the Company and the Investor. Pursuant to the Purchase Agreement, the Investor has agreed not to enter into or effect, in any manner whatsoever, directly or indirectly, any short sales of the Company's Class A Common Stock or hedging transaction which establishes a net short position with respect to the Class A Common Stock. In addition, the Company has covenanted, among other things, through the 24-month anniversary of the signing of the Purchase Agreement, to not effect or enter into any agreement to issue any shares of Class A Common Stock or securities convertible into or exercisable or exchangeable into shares of Class A Common Stock except in limited circumstances.

The Company has the right to terminate the Purchase Agreement at any time following the satisfaction of certain conditions precedent relating to the initial sale of shares to the Investor, subject to the Company paying all documented fees and amounts to the Investor's legal counsel and, if the agreement is terminated prior to effectiveness of the resale registration statement, the Company paying the $600,000 cash commitment fee to the Investor or, if the agreement is terminated after such effectiveness, the Company issuing all commitment shares of Class A Common Stock to the Investor.

The Purchase Agreement will automatically terminate on (i) the 24-month anniversary of the effective date of the initial resale registration statement filed with the Commission, (ii) the date when the Investor purchases the Total Commitment, (iii) the date when the shares of Class A Common Stock are no longer listed on the Nasdaq Capital Market or another eligible national stock exchange, or (iv) when the Company is subject to a voluntary or involuntary bankruptcy or insolvency proceeding.

In addition, the Investor may terminate the Purchase Agreement upon (i) the occurrence of an event constituting a material adverse effect (as defined in the Purchase Agreement), (ii) the occurrence of a change of control transaction of the Company, (iii) the failure by the Company to file a registration statement by the applicable deadline set forth in the Registration Rights Agreement, (iv) the lapse of the effectiveness, or unavailability of, a registration statement filed by the Company pursuant to the Registration Rights Agreement in certain other circumstances set forth in the Purchase Agreement, (v) the suspension of trading of the Class A Common Stock for a period of three (3) consecutive trading days, or (vi) the material breach of the Purchase Agreement by the Company, which breach is not cured within the 10 trading days after receipt of notice of such breach.

On December 28, 2023, the Company amended the agreement to provide that, if the number of commitment shares required to be issued by the Company to the Investor and its affiliates (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3 promulgated thereunder) pursuant to the Purchase Agreement would result in the beneficial ownership by the Investor of more than 4.99% of the outstanding shares of Class A common stock of the Company, then the Company shall be obligated to deliver to the Investor: (i) the number of shares of Class A common stock that, after giving effect to the issuance thereof to the Investor, would result in the Investor and its affiliates beneficially owning one (1) share less than 4.99% of the outstanding shares of Class A common stock of the Company, and (ii) a warrant to purchase shares of Class A common stock (such warrant, the "Warrant" and the shares issuable upon exercise thereof, the "Warrant Shares"), granting the Investor the right to purchase, at an exercise price of $0.0001 per Warrant Share, up to that number of Warrant Shares equal to the difference between (x) the number of shares that would be required to be issued to the Investor as commitment shares but-for the 4.99% ownership limitation, and (y) the number of shares of Class A common stock to be issued to the Investor as commitment shares.

The amendment further provided that, if the issuance of the total number of commitment shares of Class A common stock and Warrant Shares by the Company to the Investor would cause the beneficial ownership of the Investor and its affiliates to exceed 19.99% of the outstanding shares of Class A common stock of the Company.

On February 14, 2024, the Company issued 486 shares of Class A Common stock to an Investor. In addition, the Company, on February 13, 2024, issued a prefunded warrant to purchase up to 662 shares of Class A common stock of the Company to the Investor. The Company issued the shares and the warrant in fulfilment to its obligation to issue "commitment shares" to the Investor upon its entry into the purchase agreement. The Company issued the shares and warrant to the Investor exempt from registration pursuant to Rule 506(b) of Regulation D under the Securities Act of 1933. The Company did not receive any proceeds with respect to the issuance of the Commitment Shares or the Warrant and does not expect to receive any material proceeds from the Investor's exercise, if any, of Warrant for the purchase of Warrant shares.

**Holdback Agreement**

As part of the Valley Veterinary Services, Inc. acquisition in November 2023, a portion of the purchase price in the amount of $200,000 as part of the Holdback Agreement classified as restricted cash in the accompanying consolidated balance sheet. The Holdback Agreement dictates that $80,000 is contingent upon both former owners (now employees of the Company) still being employed by the Company as of November 8, 2025 and the Valley Vet Practice's gross revenue exceeding 105% of the target gross revenue. The remaining $120,000 is contingent upon both former owners (now employees of the Company) still being employed by the Company as of November 8, 2025 and the Valley Vet Practice's gross revenue exceeding 110% of the target gross revenue.

As the contingent consideration arrangement in which the Holdback amounts are automatically forfeited if the employment of the former owners (now employees of the Company) terminates is accounted for as compensation for post combination services. The Company will recognize the contingent consideration from the Holdback Agreement when probable.

As of the year ended December 31, 2024, the Company determined that the first milestone of the Holdback Agreement had been met, as the Valley Vet Practice's gross revenue exceeded 105% of the target and both former owners remained employed. As a result, the Company released and paid out the $80,000 holdback amount in accordance with the agreement in January 2025.

**Lawsuit Against Former Employee**

The Company is addressing a situation where a former animal clinic and hospital violated their non-compete agreement post-employment. Quantifying the resulting harm is complex and ongoing. Legal action has been initiated in Ohio State Court against the former owner, with efforts underway to fulfill court requirements for service. The Company's claim is straightforward, with no counterclaims. It anticipates a favorable judgment, likely resulting in compensation below a certain threshold.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**16.** **Segment Information** 

Management evaluates the Company's veterinary clinics as a single reportable segment as a result of aggregating multiple operating segments, because all of the Company's veterinary clinics have similar economic characteristics and provide similar services to similar types of customers. Our single reportable segment comprises the structure used by our Chief Executive Officer, who collectively have been determined to be our Chief Operating Decision Maker ("CODM"), to make key operating decisions and assess performance. Our CODM evaluates our single reportable segment's operating performance based on individual veterinary clinic net income (loss) before interest expense, income tax expense, depreciation and amortization, corporate general and administrative expense, loss on debt modification, gain of sale, interest and other income, and gains or losses on sales of clinic ("Adjusted Clinic EBITDA"). Our single reportable segment's assets are consistent with total assets included in the Company's consolidated balance sheets.

The following table includes revenue, significant veterinary clinic and hospital operating expenses, and Adjusted Clinic EBITDA for the Company's clinics, reconciled to the consolidated amounts included in the Company's consolidated statements of operations:

---

| | | |
|:---|:---|:---|
|  | **For the year ended<br> December 31,** | **For the year ended<br> December 31,** |
|  | **2024** | **2023** |
| **Revenue** |  |  |
| &nbsp;&nbsp;&nbsp;Service revenue | $12188526 | $11879934 |
| &nbsp;&nbsp;&nbsp;Product revenue | 4403583 | 4795459 |
| Total Clinics level revenue | 16592109 | 16675393 |
| **Operating expenses** |  |  |
| &nbsp;&nbsp;&nbsp;Cost of service revenue (exclusive of depreciation and amortization, shown separately below) | 9736282 | 9700963 |
| &nbsp;&nbsp;&nbsp;Cost of product revenue (exclusive of depreciation and amortization, shown separately below) | 3563279 | 3420515 |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | 2688157 | 3056702 |
| Total Clinics level expenses | 15987718 | 16178180 |
| **Adjusted Clinics EBITDA** | $604391 | $497213 |
| Reconciliation of Adjusted Clinics EBITDA to net loss |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 1308619 | 1252539 |
| &nbsp;&nbsp;&nbsp;Gain on sale of business | (467049) |  |
| &nbsp;&nbsp;&nbsp;Loss on debt extinguishment |  | 16105 |
| &nbsp;&nbsp;&nbsp;Interest expense | 3098237 | 2538710 |
| &nbsp;&nbsp;&nbsp;Loss on debt modification | 2134218 | 927054 |
| &nbsp;&nbsp;&nbsp;Beneficial conversion feature |  | 4137261 |
| &nbsp;&nbsp;&nbsp;Other income (expenses) | 4768 | (1134) |
| &nbsp;&nbsp;&nbsp;Corporate general and administrative | 8733195 | 6419585 |
| &nbsp;&nbsp;&nbsp;Impairment expense | 56664 | - |
| **Net Loss** | $(14264261) | $(14792907) |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.** **Subsequent Events** 

The Company follows the guidance in FASB ASC 855-10 for the disclosure of subsequent events. The Company evaluated subsequent events through the date the financial statements were issued and determined the Company had the following subsequent events:

**Animal Hospital and Clinic Acquisition**

On February 26, 2025, Inspire Veterinary Partners Inc entered a non-binding Letter of Intent ("LOI") with an animal hospital and clinic ("Practice") to purchase substantially all of the properties and assets of the Practice. Management has evaluated the LOI and has determined that the acquisition is not a significant transaction.

**Common Stock & Pre-Funded Warrants**

On March 25, 2025, Inspire Veterinary Partners (the "Company") entered into a securities purchase agreement (the "Purchase Agreement") with an institutional investor, pursuant to which the Company agreed to issue and sell to the investor in a registered direct offering (the "Offering") 207,896 shares (the "Shares") of Class A Common Stock (the "Common Stock"), pre-funded warrants (the "Pre-Funded Warrants") to purchase up to 885,000 shares of Common Stock, five-year warrants (the "Series A Warrants") to purchase up to 1,092,896 shares of Common Stock and eighteen-month warrants (the "Series B Warrants" and, together with the Series A Warrants, the "Common Warrants") to purchase up to 1,092,896 shares of Common Stock. Gross proceeds from the Offering, before deducting the placement agent's fees and other offering expenses, were $2,000,000.

**PROSPECTUS**

**46,419,092 Shares of Class A Common Stock**

![](image_001.jpg)

***December 9, 2025***