500 OCEAN AVENUE

PDF page 15 · financial statements as of 2025-12-31

payable 22,131 5,525 SCRIE payable 32,403 25,636 Overdraft protection liability 22,677 Prepaid stockholder maintenance assessments 37,990 46,205 Mortgage note payable 27,176 37,125 TOTAL CURRENT LIABILITIES 296,339 197,932 NON-CURRENT LIABILITIES Mortgage note payable - less current portion 1,526,527 1,541,945 Line of Credit 430,000 400,000 Security deposits 6,020 5,755 TOTAL NON-CURRENT LIABILITIES 1,962,547 1,947,700 TOTAL LIABILITIES 2,258,886 2,145,632 STOCKHOLDERS' EQUITY Common stock, par value $1; 20,000 authorized shares, 3,805 issued and outstanding 3,805 3,805 Additional paid-in capital 2,155,490 2,130,123 Accumulated deficit (2,987,628) (2,774,651) TOTAL STOCKHOLDERS' (DEFICIENCY) (828,333) (640,723) TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIENCY) $ 1,430,553 $ 1,504,909 See accompanying notes to financial statements. -4-

PDF page 21 · financial statements as of 2025-12-31

500 Ocean Apartment Corp. Notes to Financial Statements Note 4 MORTGAGE NOTE PAYABLE (continued) Future principal payments of the mortgage are as follows: Year Ending December 31, 2026 $ 27,176 2027 29,115 2028 31,192 2029 33,417 2030 35,801 Thereafter 1,397,002 $ 1,553,703 Concurrently with obtaining the mortgage, the Corporation obtained a $500,000 credit line mortgage with Flushing Bank. The interest rate is 6.5% adjusted monthly based on the bank's rate plus 1% with a floor of 6.5%, and was 8.0% and 9.0% as of December 31, 2025 and 2024, respectively. Payments of interest only based on the amount outstanding are due monthly. All other terms of the credit line mortgage, including its maturity, are the same as the mortgage note described above. During 2025 and 2024, the Corporation borrowed an additional $30,000 and $50,000 under the line of credit making the outstanding balance $430,000 and $400,000, respectively at December 31, 2025 and 2024. The Corporation does

PDF page 3 · effective period must be checked in the document

y other principal of the Successor Sponsor. 13. Terms of Apartment Corporation Mortgage. On June 4, 2019, the Apartment Corporation refinanced the underlying mortgage with Flushing Bank, located at 220 RXR Plaza, Uniondale, New York 11556, in the principal amount of $1,750,000.00 over a 15- year term. The mortgage has an initial interest rate of 4.25% which will adjust after the initial five (5) years to 6.910% and will reset in the tenth year of the term to 2% over U.S. Treasury Note Yields, but not less than 4.25%. The mortgage requires payments of principal and interest based upon a 30-year amortization schedule in the amount of currently in the amount of $11,141.00 per month. As of the submission of this Amendment, the current principal amount of the underlying mortgage is $1,542,606.99. Concurrently, the Apartment Corporation also obtained a credit line mortgage in the amount of $500,000.00 from Flushing Bank, with an interest rate of 6.5% which adjusts monthly based o

PDF page 20 · effective period must be checked in the document

ents have been reclassified to conform to the 2025 classifications. These reclassifications had no impact on the 2024 results of operations. Note 4 MORTGAGE NOTE PAYABLE The mortgage note was refinanced with Flushing Bank on June 4, 2019. The terms of the mortgage note are as follows: Original Principal: $1,750,000 Terms: Monthly payments of $8,609 applied first to interest at 4.25% with the balance to principal. During 2024 monthly payments increased to $11,141 due to the interest rate being adjusted after the initial five years to 6.910%. The interest rate will adjust again in five years to 2% over U.S. Treasury Note yields but not less than 4.25%. Maturity: The mortgage note is based on a 30-year amortization period with the balance payable in full in 15 years, however, every five years is offered a roll over option. The mortgage note is collateralized by the land, building and improvements of the Corporation. - 9 -

PDF page 21 · financial statements as of 2025-12-31

orporation does not intend to repay that amount during 2026 and accordingly it is classified as long term on the accompanying balance sheet. Note 5 FUTURE MAJOR REPAIRS AND REPLACEMENTS The Corporation's governing documents do not require the accumulation of funds to finance estimated future major repairs and replacements. The Corporation has not conducted a study to determine the remaining useful lives of the components of common property and estimates of the costs of major repairs and replacements that may be required in the future, nor has the board of directors developed a plan to fund those needs. When funds are required for major repairs and replacements, the Corporation plans to use existing funds, borrow, increase maintenance assessments, implement a special assessment, or delay repairs and replacements until funds are available. The effect on future assessments has not been determined. Note 6 CORPORATE TAXES The financial statements do not contain a provision for f

PDF page 2 · effective period must be checked in the document

is current in its financial obligations to the Apartment Corporation and has been current for the past 12 months, including maintenance, reserve or working capital fund payments, assessments and payments for repairs and improvements promised in the Plan. The term “current” as used herein means satisfying the obligations before the expiration of any grace periods. 12. Other Buildings Other Cooperatives, Condominiums and Homeowners Associations Where the Successor Sponsor Has Greater than a Ten Percent Interest. The Successor Sponsor are owners or principals of the owner of shares or units where such owner owns, in the aggregate, more than 10% of the shares or units, as the case may be, at 163 Ocean Avenue, Brooklyn, New York (Dept. of Law File No. C83-0055 ) and 1717 Avenue N, Brooklyn, New York (Dept. of Law File No. C87-0596). The term “principal” as used herein shall mean a “principal” as defined under the regulations of the Department of Law of the State of New York in

PDF page 16 · financial statements as of 2025-12-31

$ 598,081 Less: Amount applied to mortgage amortization (25,367) (30,637) Less: Coop real estate tax abatements (16,606) (10,780) 603,955 556,664 Special assessment 102,735 Rental income 67,890 64,705 Laundry income 9,842 10,608 Interest income 1,591 1,567 Storage and other income 15,457 7,500 TOTAL REVENUES 698,735 743,779 OPERATING EXPENSES Mortgage and line of credit interest 142,620 125,718 Real estate taxes 209,721 205,057 Water and sewer charges 83,768 79,026 Heat 78,805 63,931 Insurance 98,627 85,137 Gas and electric 19,617 18,541 Repairs and maintenance 45,921 48,833 Management fees 20,400 20,400 Professional fees 26,072 28,154 Supplies 7,821 9,347 Exterminating 3,266 3,266 Landscaping 9,069 9,674 Payroll and related expenses 53,424 53,424 Rent expense 23,580 23,460 Corporate taxes 1,150 1,150 Bank and line of credit charges 735 1,402 Administrative expenses 6,548 4,564 TOTAL OPERATING EXPENSES 831,144 781,084 Excess of Expenses over Revenues Before

PDF page 19 · financial statements as of 2025-12-31

ting assessments are satisfied over time on a daily pro-rata basis using the input method. The Corporation's performance obligations related to the special assessments are satisfied when the funds are expended for designated purposes. Assessments receivable at the balance sheet date are stated at the amount expected to be collected from unit owners. The Corporation's policy is to retain legal counsel and place liens on the properties of stockholders whose assessments are delinquent. It is the opinion of the Board of Directors that the Corporation will ultimately prevail against stockholders with delinquent assessments and accordingly, no allowance for doubtful accounts was deemed necessary at December 31, 2025 and 2024. The Corporation treats uncollectable assessments, if any, as credit losses. Methods and assumptions used to evaluate when assessments are considered uncollectible include consideration of past experience, susceptibility to factors outside the Corporation's con

PDF page 21 · financial statements as of 2025-12-31

are required for major repairs and replacements, the Corporation plans to use existing funds, borrow, increase maintenance assessments, implement a special assessment, or delay repairs and replacements until funds are available. The effect on future assessments has not been determined. Note 6 CORPORATE TAXES The financial statements do not contain a provision for federal income taxes due to cumulative net operating losses for income tax purposes which are available to be carried forward to future tax periods. Because the future utilization of these tax carryforward losses is uncertain, no related deferred tax asset has been reflected in the accompanying financial statements.

PDF page 23 · financial statements as of 2025-12-31

abatements to the holder of unsold shares. The amount granted as of December 31, but not yet credited, has been recorded as SCRIE payable. Note 10 SPECIAL ASSESSMENT As of April 22, 2024 the Board of Directors approved a $27.00 per share special assessment, billable over one month, effective June 1, 2024 to approximate the NYC Coop tax abatements and increased operating expenses. Note 11 HOLDER OF UNSOLD SHARES As of December 31, 2025 and 2024, the holder of unsold shares owned 2,020 shares representing 33 apartments or approximately 53% of the issued shares of the Corporation. The holder of unsold shares was current on its financial obligations to the Corporation as of December 31, 2025 and 2024. The holder of unsold shares is responsible for $342,910 and $342,144 of the maintenance assessments in 2025 and 2024, respectively. One apartment owned by the holder of unsold shares has been rented to the Corporation, under a short-term, informal agreement, for use by the Corpo

PDF page 1 · effective period must be checked in the document

building: 1F, 1H, 1J, 2A, 2C, 2F, 2H, 2J, 2L, 3B, 3D, 3F, 3L, 4D, 4E, 4G, 4H, 4J, 4K, 5A, 5D, 5E, 5F, 5G, 5J, 5K, 6B, 6C, 6E, 6G, 6H, 6J and 6K. 7. Maintenance Increase. In November 2025 the Board of Directors implemented a 6.5% maintenance increase which became effective in January 2026.

PDF page 5 · effective period must be checked in the document

HF 18784927v.2 requirements imposed by Law, shall ultimately be borne by the Unit Owners, whether through Common Charges, special assessments, financing, or otherwise. 17. Plan as Amended by this Amendment is Incorporated by Reference . The Plan, as modified and supplemented hereby, is incorporated herein by reference with the same effect as if set forth herein at length. Accordingly, all provisions, schedules and exhibits heretofore contained in the Plan shall be deemed amended to reflect the provisions contained herein. 18. Effective Period for Using the Plan Is Extended. The offering is hereby extended and will be effective for twelve (12) months from the date of this 21st Amendment. 19. No Other Material Change. There have been no other material changes to the Offering Plan. Dated: _______, 2026 EPSILON HOLDINGS, LTD. & HIOS HOLDINGS, LTD. Successor Sponsor

PDF page 20 · effective period must be checked in the document

included as other receivable to recognize legal fees that are being reimbursed in 2026. On December 5, 2025, the Board of Directors approved an 6% maintenance increase effective January 1, 2026. The increase was deemed necessary to cover increased expenses. On December 11, 2024, the Board of Directors approved an 8% maintenance increase effective January 1, 2025. The increase was deemed necessary to cover increased expenses. Property and Equipment Property and equipment are recorded at cost. Depreciation is provided using straight-line and accelerated methods over the estimated useful lives of the respective assets. Mortgage Refinancing Costs Costs incurred in connection with refinancing the Company's mortgage in 2019 have been capitalized and are being amortized using the straight-line method over the initial five year term of the mortgage. Additional Paid-in Capital The portion of maintenance assessments used for debt amortization is treated as additional paid-in capit

PDF page 24 · effective period must be checked in the document

Ocean Apartment Corp. Notes to Financial Statements Note 14 SUBSEQUENT EVENTS As of May 6, 2026 the Board of Directors approved a $15.00 per share special assessment, billable over one month, effective July 1, 2026 to approximate the NYC Coop tax abatements and increased operating expenses. - 13 -