Recent developments include a Nasdaq non-compliance issue due to share price and expansion of MBody AI's commercial deployment ahead of a merger with Check-Cap.

• Check-Cap has been reported to face Nasdaq non-compliance due to its share price, raising concerns about continued listing status [N1].
• MBody AI Corp, related to Check-Cap through a pending merger, expanded its deployment with a Fortune 500 gaming and hospitality operator across multiple properties, indicating commercial traction [N1].
• The broader biotech and medtech sectors experienced after-hours rallies across key names, including Check-Cap [N2].

The company has demonstrated positive net income and earnings per share, indicating operational profitability. Strategic moves such as acquiring exclusive regional rights and entering into a merger with MBody AI suggest efforts to expand commercial reach and product offerings. The support from Israeli Innovation Authority grants and tax benefits may provide financial advantages. The expansion of MBody AI's deployment with a Fortune 500 client reflects potential commercial traction.

Check-Cap faces significant risks including Nasdaq listing non-compliance due to share price, which could lead to delisting and reduced market liquidity. The company's liquidity ratios are low, indicating potential short-term financial stress. Geopolitical instability in Israel and supply chain risks related to key components sourced from Russia may disrupt operations. Management's broad discretion over financing proceeds may not align with shareholder interests. The company's PFIC status introduces adverse tax implications for U.S. investors, potentially limiting investment appeal.

Check-Cap's moat is derived from its proprietary medical technology developed with support from Israeli government grants, which include conditions on manufacturing location and royalty obligations. The company's exclusive rights acquisitions and strategic partnerships, such as the pending merger with MBody AI, contribute to its competitive positioning. However, the company's exposure to geopolitical risks in Israel and reliance on regulatory approvals for manufacturing and licensing may limit its moat strength. The company's ability to maintain Nasdaq listing compliance and manage liquidity constraints also impacts its competitive stability.

• Nasdaq Listing Compliance Risk: The company has faced Nasdaq non-compliance due to its share price, which may result in delisting from the Nasdaq Capital Market, affecting liquidity and shareholder value.
• Geopolitical and Supply Chain Risks: Operations are concentrated in Israel, exposing the company to political, economic, and military instability. Supply chain disruptions, especially related to components sourced from Russia, may impact product manufacturing.
• Liquidity Constraints: As of December 31, 2025, the company had a current ratio of 0.05 and cash ratio of 0.05, indicating limited short-term liquidity to cover current liabilities.
• Tax and Regulatory Risks: The company is subject to Israeli tax laws with contingent liabilities related to Innovation Authority grants and may be classified as a passive foreign investment company for U.S. tax purposes, which has adverse tax consequences for U.S. investors.
• Management Discretion on Use of Proceeds: Management has broad discretion in allocating net proceeds from financings, which may not align with shareholder interests or increase market value.

• Check-Cap Ltd is a foreign private issuer headquartered in Israel.
• The company files annual reports on Form 20-F and periodic reports on Form 6-K with the SEC.
• As of December 31, 2025, Check-Cap reported cash and equivalents of $2.0 million and short-term investments of $217.0 million, with current assets totaling $219.0 million and current liabilities of $4.049 million, resulting in a current ratio of 0.05 and a cash ratio of 0.05.
• For the fiscal year ended December 31, 2025, the company reported net income of $4.14 million and basic and diluted EPS of $0.66 per share.
• The company has a contingent liability related to Israeli Innovation Authority (IIA) grants, requiring royalty payments on sales of products developed with IIA funding until full repayment of grants plus interest.
• Check-Cap's principal offices, R&D facilities, manufacturing sites, and some suppliers are located in Israel, exposing the company to geopolitical and economic risks related to the region.
• The company has risks related to maintaining Nasdaq listing compliance, including share price requirements, and has recently faced Nasdaq non-compliance due to share price.
• Check-Cap has broad management discretion in the use of net proceeds from financings, which may not always align with shareholder interests.
• The company has entered into a Purchase Agreement with ARC for up to $30 million in share purchases over three years, with certain ownership and issuance limitations.
• Check-Cap acquired exclusive Ghost Kitchen area representative rights in New Jersey through an asset purchase agreement with Parea LLC in 2025.
• The company is subject to Israeli tax laws and government programs that provide tax benefits contingent on meeting certain manufacturing and investment conditions in Israel.
• Check-Cap is considered a passive foreign investment company (PFIC) for U.S. tax purposes for 2025 and may be for 2026, which has tax implications for U.S. investors.
• The company has cybersecurity risk management programs overseen by the Board and Audit Committee, with no material cybersecurity incidents reported.
• Recent news highlights include a Nasdaq non-compliance issue due to share price and broader biotech and medtech sector rallies.
• Check-Cap announced an expansion of MBody AI Corp's deployment with a Fortune 500 gaming and hospitality operator, related to a pending merger between Check-Cap and MBody AI.