Cosmos Health Inc. Commitments Disclosure

NOTE 15 – COMMITMENTS AND CONTINGENCIES

Legal Matters

From time to time, the Company may be involved in litigation relating to claims arising out of the Company’s operations in the normal course of business. As of December 31, 2025, the following litigations were pending. None of the below is expected to have a material financial or operational impact.

Urban Planning Compensation Claim – Cana Laboratories

In October 2023, the Company’s subsidiary, Cana Laboratories, was approached by an attorney representing two clients seeking compensation of €39,211 related to 34.70 square meters of urban sprawl, for which an Act of Imputation had been issued by the Department of Urban Planning. The Company’s legal counsel has advised that Cana is not obligated to accept the compensatory value as agreed and has suggested exploring an out-of-court settlement. As of the date of this report, the clients’ attorney has not provided further communication.

Pending Lawsuits Against Hospitals – Cana Laboratories SA

Cana Laboratories SA v. Evangelismos Hospital (Case No. ΑΓ1530/2022) — Cana Laboratories SA filed a lawsuit seeking recovery of approximately €278,054 ($326,852) plus accrued interest for unpaid invoices. The court issued Decision No. 2161/2025 rejecting the claim, against which the Company has filed an appeal before the Council of State. The ultimate outcome of the appeal remains uncertain at this time.

Cana Laboratories SA v. Evangelismos Hospital (Case No. ΑΓ1225/2023) — Cana Laboratories SA filed a lawsuit seeking recovery of approximately €248,382 ($291,501) plus accrued interest for unpaid invoices. The hearing, originally scheduled for April 8, 2025, has been postponed to May 19, 2026. Legal counsel assesses the likelihood of success and collection of the claimed amount as probable.

Cana Laboratories SA v. Konstantopouleio Hospital (Case No. ΑΓ1234/2023) — Cana Laboratories SA had initiated legal proceedings to recover approximately €1,291 ($1,515) plus accrued interest for unpaid invoices. This matter has been subsequently resolved through full repayment of the outstanding balance by the defendant.

Cana Laboratories SA v. Papanikolaou Hospital (Case No. ΑΓ575/2024) — Cana Laboratories SA had initiated legal proceedings to recover approximately €89,948 ($105,563) plus accrued interest for unpaid invoices. This matter has been subsequently resolved through full repayment of the outstanding balance by the defendant.

Cana Laboratories SA v. Theageneio Hospital (Case No. ΑΓ574/2024) — Cana Laboratories SA had initiated legal proceedings to recover approximately €16,272 ($19,097) plus accrued interest for unpaid invoices. This matter has been subsequently resolved through full repayment of the outstanding balance by the defendant. 

All above claims have been classified under “Other assets” within non-current assets in the Company’s consolidated balance sheets as of December 31, 2025. 

Employment Dispute – Cana Laboratories

A lawsuit filed on April 5, 2018, by a former employee against the Company’s subsidiary, Cana, before the Athens Court of First Instance, sought the nullification of the termination of employment and compensation for unpaid wages and moral damages. Following multiple appeals, Judgment No. 1192/2024 was issued on September 26, 2023, requiring Cana to reinstate the former employee, with a penalty of €200 per day for non-compliance. According to the Company’s legal counsel, for the penalty to be enforceable, the former employee must file a new lawsuit requesting reinstatement. As of the date of this report, no such lawsuit or request for reinstatement has been received.

On April 28, 2025, the Company entered into a settlement agreement with a former employee, acknowledging its obligation to pay €62,500 ($83,719) gross (€62,250 net after applicable severance tax) as termination compensation in nine scheduled installments from April to December 2025, with any additional tax, social security, or other charges to be borne solely by the Company; upon timely and full payment of all installments, the former employee agreed to accept the settlement and confirm the lawfulness and validity of the February 23, 2018 termination. As of December 31, 2025, the Company had not executed the last three installments, resulting in an outstanding balance of €31,125 ($36,528). Subsequent to the reporting date, one installment of €6,917 ($8,117) has been executed, with the two remaining installments expected to be settled by the end of the second quarter of 2026.

Neiada A., Neiadas B. v. Cana Laboratories SA

In February 2025, plaintiffs filed a lawsuit against the Company’s subsidiary, Cana Laboratories SA before the Single-Member First Instance Court of Athens, seeking restitution of a leased property and recovery of approximately €21,678 ($25,441) in outstanding rent and compensation for use. The monetary claims have been subsequently settled by the Company. The claim for restitution of the leased property is expected to be resolved through voluntary surrender of the premises, thereby avoiding forced execution.

DA Melissotopi Ltd v. Cana Laboratories SA

In July 2025, plaintiff filed a lawsuit against Cana Laboratories SA before the Single-Member First Instance Court of Athens, asserting claims of approximately €17,868 ($20,970) related to storage and safekeeping fees, custodial and maintenance services, and electronic platform management. The hearing is currently estimated to be scheduled in 2027. Based on the assessment of legal counsel, a significant portion of the claim is expected to be dismissed as inadmissible, with maximum estimated exposure of approximately €4,000 ($4,694).

Claims for Recovery of Receivables

Cosmofarm SA v. Papaleka E. — Cosmofarm SA has initiated legal proceedings before the Single-Member First Instance Court of Athens to recover approximately €20,301 ($23,825) in unpaid invoices. The hearing is estimated to be scheduled in the second half of 2026. Legal counsel assesses the claim as likely to be upheld.

Cosmofarm SA v. Katsanis G. — Cosmofarm SA has initiated legal proceedings before the Single-Member First Instance Court of Athens to recover approximately €15,143 ($17,772) in unpaid invoices. The hearing is estimated to be scheduled in the second half of 2026. Legal counsel assesses the claim as likely to be upheld.

Cosmofarm SA v. Renieris A. — Cosmofarm SA has initiated legal proceedings before the Single-Member First Instance Court of Athens to recover approximately €15,255 ($17,903) in unpaid invoices. The hearing is estimated to be scheduled in the second half of 2026. Legal counsel assesses the claim as likely to be upheld.

Tax Assessments — SkyPharm S.A.

In February 2026, the Greek tax authorities issued corrective assessments against the Company's subsidiary SkyPharm S.A. relating to corporate income tax for fiscal years 2017 and 2018 and VAT for fiscal year 2018, aggregating approximately €955,430 ($1,121,510) plus statutory interest. These assessments were issued subsequent to December 31, 2025 and no such assessments were pending, threatened, or known to the Company as of the balance sheet date. The Company has appealed the assessments through the applicable administrative process and based on the advice of legal counsel, believes it has strong grounds for a favourable resolution on both procedural and substantive grounds.

Advisory Agreements

The Company has entered into various advisory and consulting agreements with third-party advisors, under which the advisors provide marketing, investor relations, digital marketing, and general business advisory services. As consideration, the Company issues common stock, with the number of shares, fair value, and vesting schedules established at the grant date. Certain agreements include clawback provisions for unvested shares if the arrangement is terminated prior to full vesting. Stock-based compensation expense related to these agreements is recognized evenly over the respective service periods and is classified as “General and administrative expenses” in the consolidated statements of operations and comprehensive income (loss).

On September 5, 2025, the Company entered into a marketing services agreement with a third-party advisor, pursuant to which it issued 300,000 shares of its common stock in exchange for stock awareness, investor relations, and digital marketing services. The shares carry full voting rights and vest at a rate of 150,000 shares per month over the 2-month term of the agreement. The fair value of the shares on the issuance date was $0.649 per share, resulting in a total fair value of $194,700.

On July 24, 2025, the Company entered into a marketing services agreement with a third-party advisor, pursuant to which it issued 169,549 shares of its common stock in exchange for marketing and distribution services. The shares carry full voting rights and vest at a rate of 28,258 shares per month over the 6-month term of the agreement. In accordance with the terms of the agreement, if the Company terminates the arrangement, any unvested shares as of the termination date will be subject to claw back. The fair value of the shares on the issuance date was $0.5898 per share, resulting in a total fair value of $100,000.

On November 21, 2023, the Company entered into certain consulting agreements with four third-party consultants for the provision of a variety of services such as digital marketing, advisory services relating to target acquisitions and M&As and other additional services as described in the respective agreements. The agreements have duration from ten to 18 months and the consultants will solely receive stock consideration for the services rendered. More precisely, they have been awarded a total of 970,000 shares of the Company’s common stock valued at a total of $999,100 based on the fair value of the Company’s common stock as of the agreements’ date. On September 17, 2024 the terms of two out of the four aforementioned consulting agreements were extended and the consultants received additional 440,000 shares as complementary compensation for the extended services to be provided. The additional stock-based consideration was valued at a total of $501,600 based on the fair value of the Company’s common stock as of the agreements’ date.

On July 1, 2024 the Company entered into a consulting agreement with a third-party consultant for the provision of a variety of services such as preparation of press releases and other publications, relationship management and other additional services as described in the respective agreement. The agreement has a duration of 16 months, and the consultant will solely receive stock consideration for the services rendered. More precisely, they have been awarded a total of 240,000 shares of the Company’s common stock valued at a total of $264,000 based on the fair value of the Company’s common stock as of the agreements’ date. On July 1, 2025, the Company entered into a new consulting agreement with the above third-party advisor, pursuant to which it issued 240,000 shares of its common stock in exchange for general advisory services. The shares carry full voting rights and vest at a rate of 20,000 shares per month over the 12-month term of the agreement. In accordance with the terms of the agreement, if the Company terminates the arrangement under Section 19 (Termination), any unvested shares as of the termination date will be subject to claw back. The fair value of the shares on the issuance date was $0.3939 per share, resulting in a total fair value of $94,536.

On June 3, 2025, the Company entered into a consulting agreement with a third-party consultant, under which the consultant will provide non-exclusive business advisory services, growth strategy guidance, and networking support through October 30, 2025. As consideration, the Company issued 150,000 shares of common stock, fully earned on the effective date. If the closing price of the common stock nine months after the effective date is lower than the closing price on the effective date (subject to adjustment for corporate actions), the Company will issue additional shares such that the total value of shares issued equals $70,000 based on the nine-month market price. The stock-based consideration was valued at a total of $68,550 based on the fair value of the Company’s common stock as of the agreement’s date.

The corresponding stock-based compensation expense is accrued evenly over the term of the agreements. For the years ended December 31, 2025 and 2024 the Company has recorded $1,047,391 and $994,307, respectively, as stock-based compensation for the above agreements, classified as “General and administrative expenses” in the Company’s consolidated statements of operations and comprehensive Income (loss).

Research and Development Agreements

The Company entered into a Research & Development agreement with Doc Pharma S.A. on May 17, 2021. Under this agreement, Doc Pharma is responsible for the research, development, design, registration, copy rights and licenses of 250 nutritional supplements for the final products called Sky Premium Life®. More specifically, Doc Pharma is responsible for the product development and the Company has added 165 of such products codes in its portfolio as of December 31, 2025. The licenses purchased by Doc Pharma SA are capitalized and included in “Goodwill and intangible assets, net” of the Company’s Consolidated Balance Sheets as of December 31, 2025. Thus, no relevant R&D expense had been charged to the Company’s Consolidated Statements of Operations and Comprehensive Loss, concerning this agreement.

On June 25, 2022, the Company signed a research and development (“R&D”) agreement with a third party (CloudPharm PC), through which the Company assigned to the third party the development of new products and services in the field of health, focusing on the human intestinal microbiome. The project includes two phases. Phase 1 has a 20-month duration and its cost amounts to EUR 758,000 ($838,450) and phase 2, has a 22-month duration and a cost of EUR 820,000 ($907,084). The amount will be due and payable upon completion of the corresponding phases. The Company records the corresponding R&D expense based on the project’s progress, which is invoiced by the third party in the relevant period. For the 12-month periods ended December 31, 2025 and 2024, the Company incurred $22,996 and $0 of such costs respectively included in “Research and Development costs” in the Company’s Consolidated Statements of Operations and Comprehensive Loss. 

On January 23, 2024, the Company completed the acquisition of Cloudscreen, a cutting-edge Artificial Intelligence (AI) powered platform. The acquisition is pursuant to a purchase agreement announced on October 11, 2023. Cloudscreen is a multimodal platform specialized in drug repurposing, a process that involves uncovering new target proteins or indications for existing drugs for use in treating different diseases. The total purchase price amounted to $637,080 incorporating both cash and stock consideration. The platform is included in “Goodwill and intangible assets, net” in the Company’s Consolidated Balance Sheets.

On December 3, 2024, the Company entered into a Research Study Agreement with the National Hellenic Research Foundation (“NHRF” or the “Contractor”) for an in vitro study supporting modifications to an existing invention. This study is conducted under a prior agreement between the Company, NHRF, and CloudPharm PC, originally signed on June 15, 2022. Under the agreement, while conducting the study, NHRF will ensure scientific rigor, provide periodic updates, and maintain confidentiality. Cosmos Health will supply the necessary documentation and support to the research. Ownership of the research protocol is shared among CloudPharm PC, NHRF and Cosmos Health, while NHRF retains control over its methodologies. NHRF is prohibited from publishing findings without Cosmos Health’s approval or using the study for any other purpose. The total contract value is €60,000 plus VAT, payable in three installments. For the 12-month period ended December 31, 2025, the Company incurred €45,000 ($50,052) in costs related to this agreement, which were recorded under “Research and Development costs” in the Company’s Consolidated Statements of Operations and Comprehensive Loss.

On December 6, 2024, the Company signed an Independent Contractor Agreement with a third-party contractor (the “Contractor”). The Contractor will provide oncology research and development services exclusively to the Company. The contract lasts three years (December 5, 2024 – December 5, 2027) and may be extended by mutual agreement. The Company may terminate the contract immediately for specific causes, including felony conviction, fraud, or loss of medical license. Either party may terminate the contract with a 30-day written notice. Certain compensation obligations will remain effective after termination. The monthly consideration to be paid to the Contractor is based on the commencement of the Clinical Trials (as defined in the agreement) and New Drugs Applications (as defined in the agreement) and additional cash and stock consideration is payable based on certain milestones. None of the milestones were met as of December 31, 2025, and thus the Company has incurred no expenses as of the end of the period.

On December 31, 2024, the Company signed an agreement with a related party, DocPharma SA (the “Licensor”), through which the Company obtained a royalty-bearing, exclusive worldwide license to actively commercialize the patents owned by the Licensor, through research and preclinical and clinical trials for the useful life of the patents, or for 20 years, whichever is longer. The patents, filed in 2016 and 2017 respectively, cover innovative treatments for cancer. The terms of the agreement include an initial payment of EUR 500,000 due by the end of 2025, followed by fixed annual payments of EUR 350,000 during the five-year Start-Up Term from 2025 to 2030. After the Start-Up Term, the Company will pay an 1.5% royalty on annual net sales of licensed products covered by an issued patent. Moreover, the Company retains an optional buy-out right for a total amount of EUR 7,500,000, which can be exercised with a 60 day-notice and a 60-day close period. The Company also has the right to sublicense the patents. For the 12-month period ended December 31, 2025, the Company incurred EUR 350,000 ($410,760) in royalties concerning this agreement, which were included in “Research and Development costs” in the Company’s Consolidated Statements of Operations and Comprehensive Loss.