Citius Oncology (CTOR) Risk Analysis

Citius Pharma provides all of our operational functions, systems and infrastructure pursuant to the A&R Shared Services Agreement. We may not be able to replace these services or enter into appropriate third-party agreements on terms and conditions, including cost, comparable to those that we receive from Citius Pharma under the A&R Shared Services Agreement. Additionally, after that agreement terminates, we may be unable to sustain the services at the same levels or obtain the same benefits as when we were receiving such services and benefits from Citius Pharma. When we begin to operate these functions separately, if we do not have our own adequate systems and business functions in place, or are unable to obtain them from other providers, we may not be able to operate our business effectively or at comparable costs, and our profitability may decline. In addition, we have historically received informal support from Citius Pharma, which may not be addressed in the agreements with Citius Pharma. The level of this informal support is expected to diminish over time. The loss of some or all of these services would be difficult for the Company to replace quickly if at all. Such a loss would be expected to have a material adverse effect on the Company's operations at least in the near term. In addition, we owe Citius Pharma for fees for each of the services set forth in the A&R Shared Services Agreement and we reimburse Citius Pharma for all reasonable out-of-pocket costs and expenses that it incurs in connection with providing the services. In connection with the closing of the Merger, Citius Pharma made a loan to the Company. The loan is evidenced by an unsecured promissory note issued by the Company, dated August 16, 2024, as amended September 10, 2025, in the principal amount of $3,800,111 to Citius Pharma. The promissory note bears no interest and is repayable in full upon the date at which the Company has closed a series of capital raises that in the aggregate provide gross proceeds of at least $50 million through the issuance of debt or equity securities or the royalty-backed monetization of LYMPHIR™. To date the Company has raised $36 million in capital raises and the likelihood of raising an additional $14 million to trigger the repayment obligation is uncertain at this time. These costs we owe for services rendered by Citius Pharma to the Company and under the terms of the promissory note could have a material adverse effect on the Company's operations and revenues.

Suren Dutia, Myron Holubiak, Dr. Eugene Holuka, Leonard Mazur, Dennis McGrath, Robert Smith, and Carol Webb serve on the Board. Mr. Mazur, Jaime Bartushak and Dr. Czuczman, continue to serve as our executive officers. All of these individuals continue in their director and/or management positions with Citius Pharma. In addition, such directors and officers own shares of Citius Pharma common stock, and warrants and/or options to purchase shares of Citius Pharma common stock. Their position at Citius Pharma and the ownership of Citius Pharma equity or equity awards creates, or may create the appearance of, conflicts of interest when these directors and officers are faced with decisions that could have different implications for Citius Pharma than the decisions have for the Company. For example, potential conflicts of interest could arise in connection with the resolution of any dispute that may arise between Citius Pharma and the Company regarding the terms of the A&R Shared Services Agreement governing the services provided by Citius Pharma to the Company and the relationship between the companies. Potential conflicts of interest may also arise if the Company enters into commercial arrangements with Citius Pharma in the future. As a result of these actual or apparent conflicts, the Company might be precluded from pursuing certain growth initiatives.

Except for one director, all of our directors, executive officers and employees will also be directors and employees of Citius Pharma; the employees are all available pursuant to the A&R Shared Services Agreement. As a result of this arrangement, our relationship with Citius Pharma could give rise to certain conflicts of interest that could have an impact on our research and development programs, business opportunities, and operations generally. Even though we are developing different technologies in different fields than Citius Pharma, we could be in competition with Citius Pharma for research scientists, financing and other resources, licensing, manufacturing, and distribution arrangements. Citius Pharma will engage for its own business in research and product development programs, investments, and business ventures, and we will not be entitled to participate or to receive an interest in those programs, investments, or business ventures. Citius Pharma will not be obligated to present any particular research and development, investment, or business opportunity to us, even if the opportunity would be within the scope of our research and development plans or programs, business objectives, or investment policies. These opportunities may include, for example, opportunities to acquire businesses or assets, including but not limited to patents and other intellectual property that could be used by us or by Citius Pharma. Each conflict of interest will be resolved by the respective boards of directors in keeping with their fiduciary duties and such policies as they may implement from time to time.

We are an emerging growth company, as defined in the JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies," including exemption from compliance with the auditor attestation requirements under Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We will remain an emerging growth company until the earliest of: (a) the fifth anniversary of the closing of TenX's initial public offering, which was consummated on October 18, 2022, (b) the end of the fiscal year in which our total gross revenues exceed $1.235 billion, (c) the date one we qualify as a large accelerated filer as that term is defined by Rule 12b-2 of the Exchange Act, or (d) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. In addition, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. We are also a smaller reporting company as defined in the Exchange Act. 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 take advantage of many of the same exemptions from disclosure requirements including exemption from compliance with the auditor attestation requirements of Section 404 and reduced disclosure obligations regarding executive compensation in our registration statements, periodic reports and proxy statements. We will be able to take advantage of these scaled disclosures for so long as our common stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100 million during the most recently completed fiscal year and our common stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter. We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and its market price may be more volatile.

The Certificate of Incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a breach of fiduciary duty, any action asserting a claim against us arising pursuant to the DGCL, the Certificate of Incorporation or the Bylaws, or any action asserting a claim against us that is governed by the internal affairs doctrine; provided that this provision would not apply to suits brought to enforce a duty or liability created by the Securities Exchange Act of 1934, as amended (the "Exchange Act"). In addition, the Certificate of Incorporation provides that, unless we consent in writing to the selection of an alternative forum, the U.S. federal district courts shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. For the avoidance of doubt, this provision is intended to benefit and may be enforced by us, our officers and directors, the underwriters to any offering giving rise to such complaint, and any other professional entity whose profession gives authority to a statement made by that person or entity and who has prepared or certified any part of the documents underlying the offering. We note, however, that there is uncertainty as to whether a court would enforce this provision and that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. These choice of forum provisions may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors and officers, which may discourage such lawsuits against us and our directors and officers or could result in increased costs for our stockholders to bring a claim in the chosen forum. If a court were to find the choice of forum provisions in the Certificate of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.

Our Certificate of Incorporation and Bylaws contain provisions that could significantly reduce the value of our shares to a potential acquiror or delay or prevent changes in control or changes in our management without the consent of the Board. The provisions in our governance documents include the following: - a classified board of directors divided into three classes, with only one class of directors being elected in each year and each class serving a three-year term, which may delay the ability of stockholders to change the membership of a majority of the Board;- no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;- in the event that Citius Pharma ceases to beneficially own more than 50% of the voting power of the then-outstanding shares of stock entitled to vote generally in the election of directors (the "Trigger Event,"), the approval of at least 66-2/3% of the shares entitled to vote will be required to remove a director for cause, and the prohibition on removal of directors without cause;- the ability of the Board to authorize the issuance of shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror;- the ability of the Board to alter our Bylaws without obtaining stockholder approval;- upon the occurrence of the Trigger Event, the required approval of at least 66-2/3% of the shares entitled to vote to adopt, amend or repeal the Bylaws or repeal the provisions of our Certificate of Incorporation regarding the election and removal of directors;- upon the occurrence of the Trigger Event, a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;- upon the occurrence of the Trigger Event, the requirement that a special meeting of stockholders may be called only by the Board, the chair of the Board, the chief executive officer, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;- advance notice procedures that stockholders must comply with in order to nominate candidates to the Board or to propose matters to be acted upon at a stockholders' meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror's own slate of directors or otherwise attempting to obtain control of us; and - upon the occurrence of the Trigger Event, we also become subject to the anti-takeover provisions contained in Section 203 of the General Corporation Law of the State of Delaware ("DGCL"). Under Section 203, a corporation may not, in general, engage in a business combination with any holder of 15% or more of our capital stock unless the holder has held the stock for three years or, among other exceptions, the Board has approved the transaction.

In the past, securities litigation has often been brought against a company following a decline in the market price of its securities. If we face such litigation, it could result in substantial costs and a diversion of management's attention and resources, which could harm our business.

Citius Pharma controls approximately 79% of the voting power of the outstanding shares of common stock as of December 10, 2025. As a result, the Company is a "controlled company" within the meaning of the corporate governance standards of Nasdaq. Under these corporate governance standards, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a "controlled company" and may elect not to comply with certain corporate governance requirements. For example, controlled companies: - are not required to have a board that is composed of a majority of "independent directors" as defined under the Nasdaq continued listing requirements;- not required to have a compensation committee that is composed entirely of independent directors or have a written charter addressing the committee's purpose and responsibilities; and - are not required to have director nominations be made, or recommended to the full board of directors, by its independent directors or by a nominating and corporate governance committee that is composed entirely of independent directors, and to adopt a written charter or a board resolution addressing the nominations process. While we do not currently rely on these exemptions, we may opt to utilize these exemptions in the future as long as we remain a controlled company. Accordingly, our stockholders may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of Nasdaq.

The trading market for common stock may be influenced by the research and reports that industry or securities analysts publish about us or our business. We currently have research coverage by three securities and industry analysts. If any of the analysts who cover us issue an adverse opinion regarding us, our business model, our intellectual property or our stock performance, or if our commercialization efforts for LYMPHIR, or any clinical trials and operating results fail to meet the expectations of analysts, our stock price would likely decline. If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Our Board has the authority to issue up to 10,000,000 shares of preferred stock and to fix and determine the relative rights and preferences of any such preferred stock without further stockholder approval. As a result, our Board could authorize the issuance of one or more series of preferred stock that would grant preferential rights to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption of the preferred shares, together with a premium, prior to the redemption of the common stock. In addition, our Board could authorize the issuance of a series of preferred stock that has greater voting power than the common stock or that is convertible into common stock, which could decrease the relative voting power of the common stock or result in dilution to our existing stockholders.

If our common stock were removed from listing with The Nasdaq Capital Market, we may be subject to the so-called "penny stock" rules. The SEC has adopted regulations that define a "penny stock" to be any equity security that has a market price per share of less than $5.00, subject to certain exceptions, such as any securities listed on a national securities exchange, which is the exception on which we rely. For any transaction involving a "penny stock," unless exempt, the rules impose additional sales practice requirements on broker-dealers, subject to certain exceptions. If the common stock were delisted and determined to be a "penny stock," a broker-dealer may find it more difficult to trade the common stock and an investor may find it more difficult to acquire or dispose of the common stock on the secondary market.

The common stock is listed for trading on The Nasdaq Capital Market, and the continued listing of the common stock on The Nasdaq Capital Market is subject to compliance with a number of listing standards. These listing standards include the requirement of maintaining a minimum level of stockholders' equity and maintaining a minimum stock price of $1.00. The failure to meet any listing standard would subject Company to potential loss of listing. If the common stock were no longer listed on The Nasdaq Capital Market or any other Nasdaq market, investors might only be able to trade on one of the over-the-counter markets, including the OTC Bulletin Board or in the Pink Sheets (a quotation medium operated by Pink Sheets LLC). This would impair the liquidity of the common stock, not only in the number of shares that could be bought and sold at a given price, which might be depressed by the relative illiquidity, but also through delays in the timing of transactions and reduction in media coverage. In addition, we could face significant material adverse consequences, including: - a limited availability of market quotations for our securities;- a limited amount of news and analyst coverage for us; and - a decreased ability to issue additional securities or obtain additional financing in the future. In the event of a future delisting, we intend to take actions to restore our compliance with Nasdaq's continued listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with Nasdaq's continued listing requirements.

Citius Pharma has stated its intention to effect a pro rata distribution of an undetermined amount of the common stock it holds in Citius Oncology to Citius Pharma stockholders at a yet-to-be determined date in the future. As of December 10, 2025, approximately 79% of our outstanding shares of common stock are owned by Citius Pharma. The timeline and details with respect to such distribution have not been announced. Stockholders receiving shares of our common stock in such distribution may be able to sell those shares immediately in the public market. Although we have no actual knowledge of any plan or intention of any significant Citius Pharma stockholder to sell our common stock following the potential distribution, it is likely that some Citius Pharma stockholders, possibly including some of its larger stockholders, would sell their shares of our common stock received in the potential distribution if we do not fit their investment objectives or in order to cover the related tax liability. The sales of significant amounts of our common stock or the perception in the market that this will occur may decrease the market price of our common stock and increase the volatility of our common stock.

For the foreseeable future, until LYMPHIR generates significant revenue, if at all, we will need to raise capital to finance our operations, including possible acquisitions or strategic transactions. To do so, we might be required to issue equity securities, resulting in the dilution of the ownership interests of our present stockholders. The Company is currently authorized to issue an aggregate of 400,000,000 shares of common stock and 10,000,000 shares of preferred stock, of which 84,797,846 shares are outstanding as of December 23, 2025. We may also issue additional shares of common stock or other securities that are convertible into or exercisable for common stock in connection with hiring or retaining employees, or for other business purposes. The future issuance of any such additional shares of common stock or common stock equivalents may create downward pressure on the trading price of the common stock.

Subject to certain exceptions, the amended and restated registration rights agreement entered into in connection with the Merger (the "A&R Registration Rights Agreement") provides for certain restrictions on transfer with respect to the securities of the Company, including shares held by 10XYZ Holdings, LP, the sponsor of TenX, and securities held by certain directors and officers of the Company and Citius Pharma. Such restrictions expired February 9, 2025, subject to certain exceptions. Following the expiration of the lock-up period, such equity holders are not restricted from selling or distributing shares of common stock held by them, other than by applicable securities laws. Further, because we are not expected to generate revenue in the near future, we will need to continue to raise capital through one or more equity financings in order to continue commercializing LYMPHIR and developing our other product candidates. As such, sales of a substantial number of shares of common stock and/or securities convertible into common stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of the common stock.

Following the Merger, the market price of our common stock has fluctuated significantly due to a number of factors, some of which are beyond our control, including those factors discussed in this "Risk Factors" and "Risk Factor Summary" section of this report and many others, such as: - the Company's cash resources available to successfully commercialize LYMPHIR, including covering the costs of licensing payments, product manufacturing and other third-party goods and services;- the Company's ability to meet its contractual obligations;- the Company's ability to commercialize LYMPHIR or any future product candidates, if approved;- the level of success and the cost of our marketing efforts for LYMPHIR and any future product candidates;- unanticipated serious safety concerns related to the use of LYMPHIR or any other product candidate;- announcements regarding results of any pre-clinical or clinical trials relating to our future product candidates;- adverse regulatory decisions;- changes in laws or regulations applicable to LYMPHIR or any future product candidates, including but not limited to clinical trial requirements for approvals and post-approval requirements;- the Company's dependence on third parties and on Citius Pharma under the A&R Shared Services Agreement;- future issuances of debt or equity securities;- actual or anticipated fluctuations in the Company's financial condition and operating results, including fluctuations in our quarterly and annual results;- the Company's inability to establish additional partnerships, the termination of license agreements by our existing partners or announcements by our partners regarding therapeutic candidates competitive with ours;- the introduction of new technologies or enhancements to existing technologies by us or others in the industry;- the recruitment or departure of key scientific or management personnel;- announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by the Company or our competitors;- the Company's failure to meet the estimates and projections of the investment community or that we may otherwise provide to the public;- publication of research reports about us, the indications we seek to treat or our industry, or oncology research in particular, or positive or negative recommendations or withdrawal of research coverage by securities analysts;- changes in the market valuations of similar companies;- overall performance of the equity markets;- announcements or actions taken by Citius Pharma as the Company's majority stockholder;- sales (or distributions) of our common stock by Citius Pharma, or our other stockholders in the future;- trading volume of our common stock;- legal disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain and maintain patent protection for LYMPHIR or any future product candidates, government investigations and the results of any proceedings or lawsuits, including, but not limited to, patent or stockholder litigation;- significant lawsuits, including patent or stockholder litigation;- the impact of any natural disasters or public health emergencies;- general economic, industry and market conditions other events or factors, many of which are beyond the Company's control; and - changes in accounting standards, policies, guidelines, interpretations or principles. In addition, in the past, stockholders have initiated Company action lawsuits against biotechnology and biopharmaceutical companies following periods of volatility in the market prices of these companies' stock. Such litigation, if instituted against us, could cause the Company to incur substantial costs and divert our management's attention and resources, which could have a material adverse effect on our business, financial condition and results of operations.