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Item 1A. Risk Factors

2026-03-30 compared with 2025-06-30 · 472 added, 573 removed, 45 unchanged (96% of the section changed)

10 unchanged sentences

Related to Our Business

factors raise substantial doubt about the Company’s ability to continue as a going concern.

Company has incurred significant losses since its inception, including a net loss of $6.3 million for the year ended December 31, 2024,

and has an accumulated deficit of $123.1 million as of December 31, 2024.

These factors, among others, raise substantial doubt about

the Company’s ability to continue as a going concern.

The Company’s continuation as a going concern is dependent upon its

ability to generate positive cash flows from operations and to secure additional sources of equity and/or debt financing.

Company’s intent to fund operations through equity and debt financing arrangements, there is no assurance that such financing will

be available on terms acceptable to the Company, if at all.

independent auditors have included an explanatory paragraph in their audit report regarding the Company’s ability to continue as

a going concern.

This going concern risk may materially limit our ability to raise additional funds through the issuance of new debt

or equity or may adversely affect the terms upon which such capital may be available.

The inability to obtain sufficient financing on

acceptable terms could have a material adverse effect on the Company’s financial condition, results of operations, and business

Company is actively pursuing strategies to mitigate these risks.

However, there can be no assurance that these efforts will prove successful

or that the Company will achieve its intended financial stability.

The failure to successfully address these going concern risks may

materially and adversely affect the Company’s business, financial condition, and results of operations.

Investors should consider

the substantial risks and uncertainties inherent in the Company’s business before investing in the Company’s securities.

failure to develop or maintain effective internal controls over financial reporting or difficulties encountered in implementing or improving

our internal controls over financial reporting could harm our operating results and prevent us from meeting our reporting obligations.

internal controls, particularly those related to financial reporting, are necessary for us to produce reliable financial reports.

cannot provide reliable financial reports, our business and operating results could be harmed, investors could lose confidence in our

reported financial information, and the trading price of our common stock could drop significantly.

In addition, investors relying upon

this misinformation could make an uninformed investment decision, and we could be subject to sanctions or investigations by the SEC or

other regulatory authorities or to stockholder class action securities litigation.

In connection

with the audit of our financial statements as of and for the year ended December 31, 2024 (the “2024 audit”), our management

identified a material weakness in our internal control over financial reporting related to the lack of accounting department resources

and/or policies and procedures to ensure recording and disclosure of items in compliance with U.S.

This material weakness resulted

in adjustments to our prepaid expense accounts and recording short term notes receivable net of current expected credit losses in connection

with the 2024 audit.

In response to the material weakness, we took a number of remediation steps to enhance our internal controls, including

implementing additional procedures and utilizing external consulting resources with experience and expertise in U.S.

GAAP and public company

accounting and reporting requirements to assist management with its accounting and reporting of complex and/or non-recurring transactions

and related disclosures.

In connection with

the audit of our financial statements as of and for the year ended December 31, 2024 (the “2024 audit”), our management determined

that the material weakness identified in connection with the 2024 audit had not been fully remediated and resulted in adjustments to

the accounting treatment related to our prepaid expense accounts and recording short term

notes receivable net of current expected credit losses during the 2024 audit, which resulted in the late filing of the 2024 Annual

the year ended December 31, 2024 audit, we identified the lack of sufficient number of personnel within the accounting function to adequately

segregate duties, the Company did not have a designed and implemented effective Information Technology General Controls (“ITGC”)

related to access controls to financial accounting system, and the Company did not have formalized documentation of its processes and

controls that could be evaluated for proper design and implementation.

to continue to take steps to enhance our internal controls, including implementing additional internal procedures and utilizing well-established

external consulting resources with experience and expertise in U.S.

GAAP and public company accounting and reporting requirements.

If we are unable to remediate the material weaknesses and achieve and maintain effective internal control over financial

reporting and effective disclosure controls, our business could be adversely affected.

uncertain economic conditions, including inflation and the risk of a global recession could impair our ability to forecast and may harm

our business, operating results, including our revenue growth and profitability, financial condition and cash flows.

inflation rates have come down substantially from their 2022 highs, the U.S.

economy is still experiencing higher than target inflation

rates, and high levels of inflation persist in many countries around the world.

Historically, we have not experienced significant inflation

risk in our business.

The global economy suffers from slowing growth and elevated interest rates, and many economists are still unsure

whether a global recession may begin in the near future.

If the global economy slows, our business would likely be adversely affected.

business and operations would suffer in the event of computer system failures, cyberattacks or a deficiency in our cybersecurity or a

natural disaster.

are growing risks related to the security, confidentiality and integrity of personal and corporate information stored and transmitted

electronically due to increasingly diverse and sophisticated threats to networks, systems and data security.

Potential attacks span a

spectrum from attacks by criminal hackers, hacktivists, and nation state or state-sponsored actors, to employee malfeasance and human

or technological error.

the implementation of security measures, our internal computer systems, and those of third parties on which we rely (including our vendors,

contractors and other third-party partners who process information on our behalf or have access to our systems), are vulnerable to damage

from computer viruses, malware, ransomware, phishing attacks and other forms of social engineering, denial-of-service attacks, third

party or employee theft or misuse and other negligent actions, natural disasters, terrorism, war, telecommunication and electrical failures,

cyberattacks or cyber-intrusions over the internet, security incidents, disruptions, attachments to emails, persons inside our organization,

or persons with access to systems inside our organization.

The risk of a security breach or disruption, particularly through cyberattacks

or cyber intrusion, including by computer hackers, foreign governments, and cyber terrorists, has generally increased as the number,

intensity and sophistication of attempted attacks and intrusions from around the world have increased.

If such an event were to occur

and cause interruptions in our operations, it could result in a material disruption of our product development programs.

To the extent

that any disruption or security breach was to result in a loss of or damage to our data or applications, or inappropriate disclosure

of confidential or proprietary information, we could incur material legal claims (including class claims) and liability, substantial

remediation costs, regulatory enforcement, liability under data protection laws, additional reporting requirements and damage to our

reputation, and the further development of our product lines could be delayed.

have a history of negative cash flows and will require additional financing to execute our business strategy.

have incurred recurring losses and experienced negative cash flows from operations.

We incurred net loss of $16.9 million for the

year ended December 31, 2025.

As of December 31, 2025, we remain in a development and investment stage with respect to our digital

asset and software initiatives and have not generated material revenue from these initiatives.

Our ability to continue developing

and deploying our software platforms depends on our ability to obtain additional financing.

There can be no assurance that such

financing will be available on acceptable terms, or at all.

If we are unable to secure sufficient capital when needed, we may be

required to delay, reduce, or eliminate development activities, reduce operating expenses, or otherwise materially modify our

business plans.

Any equity financing may result in substantial dilution to our stockholders, and debt or convertible debt financing

may impose restrictive covenants that could adversely affect our operations.

are in an early-stage development phase under our current business model.

the divestiture of our prior diagnostics business , we transitioned to a digital asset–focused software strategy.

Our RWA + EAI initiatives remain in development phases and have not generated material revenue.

We have limited operating history under

our current business model, and investors have limited historical information upon which to evaluate our prospects.

Our future success

depends on our ability to successfully develop, deploy, and commercialize new software platforms in competitive and evolving markets.

future growth may be limited.

ability to achieve our expansion objectives and to manage our growth effectively depends upon a variety of factors, including our ability

to attract and retain skilled employees, to successfully position and market our product candidates when available, to protect our existing

intellectual property, to capitalize on the potential opportunities we are pursuing with third parties and to acquire sufficient funding

whether internally or externally.

To accommodate growth and compete effectively, we will need cash to fund our operations, including

continuing our research and development efforts on our product candidates, develop additional procedures and controls and increase, train,

motivate and manage our workforce.

There is no assurance that our personnel, systems, procedures and controls will be adequate to support

our potential future operations.

will need additional financing in order to grow our business.

time to time, in order to expand operations to meet customer demand, we will need to incur additional capital expenditures.

These capital

expenditures are intended to be funded from third party sources, including the incurring of debt and/or the sale of additional equity

In addition to requiring additional financing to fund capital expenditures, we may require additional financing to fund working

capital, research and development, sales and marketing, general and administrative expenditures and operating losses.

The incurrence

of debt creates additional financial leverage and therefore an increase in the financial risk of our operations.

The sale of additional

equity securities will be dilutive to the interests of current equity holders.

In addition, there can be no assurance that such additional

financing, whether debt or equity, will be available to us or that it will be available on acceptable commercial terms.

Any inability

to secure such additional financing on appropriate terms could have a materially adverse impact on our business, financial condition

and operating results.

conditions, including direct or indirect acts of war or terrorism, could have an adverse effect on our operations and financial results.

operations could be disrupted by geopolitical conditions, political and social instability, acts of war, terrorist activity or other

similar events.

It is not possible to predict the broader consequences of current global conflicts, although such consequences can include

rising geopolitical tensions, rising regional instability, geopolitical shifts, cyberattacks or the disruption of energy exports for

the parties involved, neighboring parties, or supporting parties of these conflicts or their resulting sanctions.

Such consequences could

materially adversely affect global trade, currency exchange rates, regional economies and the global economy.

These situations remain

uncertain, and while it is difficult to predict the impact of any of the foregoing, these conflicts and actions taken in response to

these conflicts could increase our costs, disrupt our supply chain, reduce our sales and earnings, impair our ability to raise additional

capital when needed on acceptable terms, if at all, or otherwise adversely affect our business, financial condition, and results of operations.

are subject to litigation, which could result in significant expenses and negatively impact our business, financial condition, and results

of operations.

January 29, 2025, Lifesci Capital LC (“Lifesci”) filed a lawsuit against us in the United States District Court for the Southern

District of New York, alleging breach of contract and seeking damages in the amount of $503,483.

We believe that no amount is owed to

Lifesci under the agreement at issue and are vigorously defending against the claims.

However, litigation is inherently uncertain and

costly, and we cannot guarantee the outcome.

An adverse result in this or other legal matters could materially impact our business, reputation,

financial condition, and results of operations.

related to regulatory approval

if our development efforts are successful, we may not obtain regulatory approval for any of our product candidates in the United States

or other jurisdictions, which would prevent us from commercializing our product candidates.

Even if we obtain regulatory approval for

our product candidates, any such approval may be subject to limitations, including with respect to the approved indications or patient

populations, which could impair our ability to successfully commercialize our product candidates.

are not permitted to market or promote or sell any of our product candidates before we receive regulatory approval from the FDA or comparable

foreign regulatory authorities, and we may never receive such regulatory approval for any of our product candidates.

Securing marketing

approval requires the submission of extensive preclinical and clinical data and supporting information to regulatory authorities for

each therapeutic indication to establish the product candidate’s safety and efficacy for that indication.

Securing marketing approval

also requires the submission of information about the product manufacturing process to, and inspection or remote regulatory assessment

of manufacturing facilities and clinical trial sites by, the regulatory authorities.

If we do not receive approval from the FDA and comparable

foreign regulatory authorities for any of our product candidates, we will not be able to commercialize such product candidates in the

United States or in other jurisdictions.

If significant delays in obtaining approval for and commercializing our product candidates occur

in any jurisdiction, our business, financial condition, results of operations, stock price and prospects will be materially harmed.

if our product candidates are approved, they may:

be subject to limitations on the

indicated uses or patient populations for which they may be marketed, distribution restrictions, or other conditions of approval;

contain significant safety warnings,

including boxed warnings, contraindications, and precautions;

not be approved with label statements necessary or

desirable for successful commercialization;

contain requirements for costly post-market testing

and surveillance, or other requirements, including the submission of a REMS to monitor the safety or efficacy of the products.

regulatory approval processes of the FDA and comparable foreign regulatory authorities are lengthy, time consuming and inherently unpredictable.

If we are not able to obtain, or experience delays in obtaining, required regulatory approvals, we will not be able to commercialize

our product candidates as expected, and our ability to generate revenue may be materially impaired.

time required to obtain approval by the FDA and comparable foreign regulatory authorities is unpredictable but typically takes many years

following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory

In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change

during the course of a product candidate’s clinical development and may vary among jurisdictions and there may be varying interpretations

of data obtained from preclinical studies or clinical trials, any of which may cause delays or limitations in the approval or a decision

not to approve an application.

These regulatory requirements may require us to amend our clinical trial protocols, conduct additional

preclinical studies or clinical trials that may require regulatory or IRB approval, or otherwise cause delays in the approval or rejection

of an application.

Any delay in obtaining or failure to obtain required approvals could materially adversely affect our ability to generate

revenue from the particular product candidate, which may materially harm our business, financial condition, results of operations, stock

price and prospects.

we experience delays in obtaining approval, if we fail to obtain approval of a product candidate or if the label for a product candidate

does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate, the commercial

prospects for such product candidate may be harmed and our ability to generate revenues from that product candidate may be materially

in product candidate manufacturing or formulation may result in additional costs or delay.

product candidates are developed through preclinical studies to later stage clinical trials towards approval and commercialization, it

is common that various aspects of the development program, such as manufacturing methods, facilities, equipment and formulation, are

altered along the way in an effort to optimize processes and results.

Any of these changes could cause our product candidates to perform

differently and affect the results of planned clinical trials or other future clinical trials conducted with the altered materials.

changes may also require additional testing, or notification to, or approval by the FDA or a comparable foreign regulatory authority.

This could delay completion of clinical trials, require the conduct of bridging clinical trials or studies, require the repetition of

one or more clinical trials, increase clinical trial costs, delay approval of our product candidates and/or jeopardize our ability to

commence product sales and generate revenue.

approval by the FDA or comparable foreign regulatory authorities is limited to those specific indications and conditions for which approval

has been granted, and we may be subject to substantial fines, penalties, injunctions, or other enforcement actions, including criminal

actions, if we are determined to be promoting the use of our products for unapproved or “off label” uses, resulting in damage

to our reputation and business.

must comply with requirements concerning advertising and promotion for any product candidates for which we obtain marketing approval.

Promotional communications with respect to therapeutics are subject to a variety of legal and regulatory restrictions and continuing

review by the FDA, Department of Justice, Department of Health and Human Services’ Office of Inspector General, state attorneys

general, members of Congress, and the public.

When the FDA or comparable foreign regulatory authorities issue regulatory approval for

a product candidate, the regulatory approval is limited to those specific uses and indications for which a product is approved.

are not able to obtain FDA approval for desired uses or indications for our product candidates, we may not market or promote them for

those indications and uses, referred to as off label uses, and our business, financial condition, results of operations, stock price

and prospects may be materially harmed.

We also must sufficiently substantiate any claims that we make for our products, including claims

comparing our products to other companies’ products, and must abide by the FDA’s strict requirements regarding the content

of promotion and advertising.

physicians may choose to prescribe products for uses that are not described in the product’s labeling and for uses that differ

from those tested in clinical trials and approved by the regulatory authorities, we are prohibited from marketing and promoting the products

for indications and uses that are not specifically approved by the FDA.

These off label uses are common across medical specialties and

may constitute an appropriate treatment for some patients in varied circumstances.

Regulatory authorities in the United States generally

do not restrict or regulate the behavior of physicians in their choice of treatment within the practice of medicine.

Regulatory authorities

do, however, restrict communications by biopharmaceutical companies concerning off label use.

we are found to have impermissibly promoted any of our product candidates, we may become subject to significant liability and government

The FDA and other agencies actively enforce the laws and regulations regarding product promotion, particularly those prohibiting

the promotion of off label uses, and a company that is found to have improperly promoted a product may be subject to significant sanctions.

The federal government has levied large civil and criminal fines against companies for alleged improper promotion and has enjoined several

companies from engaging in off label promotion.

The FDA has also requested that companies enter into consent decrees or permanent injunctions

under which specified promotional conduct is changed or curtailed.

the United States, engaging in the impermissible promotion of our products, following approval, for off label uses can also subject us

to false claims and other litigation under federal and state statutes.

These include fraud and abuse and consumer protection laws, which

can lead to civil penalties, and criminal fines and agreements with governmental authorities that materially restrict the manner in which

we promote or distribute therapeutic products and conduct our business.

These restrictions could include corporate integrity agreements

and non- or deferred prosecution agreements and could lead to exclusion from participation in federal and state healthcare programs,

and suspension and debarment from government contracts and refusal of orders under existing government contracts.

These False Claims

Act lawsuits against manufacturers of drugs and biologics have increased significantly in volume and breadth.

In addition, False Claims

Act lawsuits may expose manufacturers to follow-on claims by private payers based on fraudulent marketing practices.

This growth in litigation

has increased the risk that a biopharmaceutical company will have to defend a false claims action, pay civil penalties, criminal fines

or restitution, agree to comply with burdensome reporting and compliance obligations, and be excluded from Medicare, Medicaid, or other

federal and state healthcare programs.

If we do not lawfully promote our approved products, if any, we may become subject to such litigation

and, if we do not successfully defend against such actions, those actions may have a material adverse effect on our business, financial

condition, results of operations, stock price and prospects.

the United States, the promotion of biopharmaceutical products is subject to additional FDA requirements and restrictions on promotional

If after one or more of our product candidates obtains marketing approval the FDA determines that our promotional activities

violate its regulations and policies pertaining to product promotion, it could request that we modify our promotional materials or subject

us to regulatory or other enforcement actions, including issuance of warning letters or untitled letters, suspension or withdrawal of

an approved product from the market, requests for recalls, payment of civil fines, disgorgement of money, imposition of operating restrictions,

injunctions or criminal prosecution, and other enforcement actions.

Similarly, industry codes in foreign jurisdictions may prohibit companies

from engaging in certain promotional activities and regulatory agencies in various countries may enforce violations of such codes with

civil penalties.

If we become subject to regulatory and enforcement actions our business, financial condition, results of operations,

stock price and prospects will be materially harmed.

if our product candidates receive regulatory approval, we will be subject to ongoing obligations and continued regulatory review, which

may result in significant additional expense and limit how we manufacture and market our products.

product candidate for which we obtain marketing approval will be subject to extensive and ongoing requirements of and review by the FDA

and comparable foreign regulatory authorities, including requirements related to the manufacturing processes, post approval clinical

data, labeling, packaging, distribution, adverse event reporting, shortage reporting, risk management plans, supply chain security, storage,

recordkeeping, export, import, advertising, marketing, and promotional activities for such product.

These requirements further include

submissions of safety and other post-marketing information, including manufacturing deviations and reports, registration and listing

requirements, the payment of annual fees, continued compliance with current Good Manufacturing Practice, or cGMP, requirements relating

to manufacturing, quality control, quality assurance, and corresponding maintenance of records and documents, and good clinical practices,

or GCPs, for any clinical trials that we conduct post approval.

FDA and comparable foreign regulatory authorities will continue to closely monitor the safety profile of any product even after approval.

If the FDA or comparable foreign regulatory authorities become aware of new safety information after approval of any of our product candidates,

they may withdraw approval, issue public safety alerts, require labeling changes or establishment of a REMS or similar strategy, impose

significant restrictions on a product’s indicated uses or marketing, or impose ongoing requirements for potentially costly post

approval studies or post-market surveillance.

Any such restrictions could limit sales of the product.

and any of our suppliers or collaborators, including our contract manufacturers, could be subject to periodic unannounced inspections

or remote regulatory assessments by the FDA to monitor and ensure compliance with cGMPs and other FDA regulatory requirements.

holders must further notify the FDA, and depending on the nature of the change, obtain FDA preapproval for product and manufacturing

addition, later discovery of previously unknown adverse events or that the product is less effective than previously thought or other

problems with our products, manufacturers or manufacturing processes, or failure to comply with regulatory requirements both before and

after approval, may yield various negative results, including:

restrictions on manufacturing, distribution,

or marketing of such products;

restrictions on the labeling, including required additional

warnings, such as black boxed warnings, contraindications, precautions, and restrictions on the approved indication or use;

modifications to promotional pieces;

issuance of corrective information;

requirements to conduct post-marketing studies or other

clinical trials;

clinical holds or termination of clinical trials;

requirements to establish or modify a REMS or similar

changes to the way the product candidate is administered;

liability for harm caused to patients or subjects;

reputational harm;

the product becoming less competitive;

warning, untitled, or cyber letters;

suspension of marketing or withdrawal of the products

from the market;

regulatory authority issuance of safety alerts, Dear

Healthcare Provider letters, press releases, or other communications containing warnings or other safety information about the product

refusal to approve pending applications or supplements

to approved applications that we submit;

recalls of products;

fines, restitution or disgorgement of profits or revenues;

suspension or withdrawal of marketing approvals;

refusal to permit the import or export of our products;

product seizure or detention;

FDA debarment, suspension and debarment from government

procurement and non-procurement programs, and refusal of orders under existing government contracts, exclusion from federal healthcare

programs, consent decrees, corporate integrity agreements, or non- or deferred prosecution agreements;

injunctions, the imposition of civil penalties, criminal

fines, or imprisonment.

of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, or

could substantially increase the costs and expenses of commercializing such product, which in turn could delay or prevent us from generating

significant revenues from its marketing and sale.

Any of these events could further have other material and adverse effects on our operations

and business and could adversely impact our business, financial condition, results of operations, stock price and prospects.

FDA’s policies or those of comparable foreign regulatory authorities may change and additional government regulations may be enacted

that could prevent, limit or delay regulatory approval of our product candidates, limit the marketability of our product candidates,

or impose additional regulatory obligations on us.

Changes in medical practice and standard of care may also impact the marketability

of our product candidates.

we are slow or unable to adapt to changes in existing requirements, standards of care, or the adoption of new requirements or policies,

or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and be subject

to regulatory enforcement action.

any of the above actions take place, we could be prevented from or significantly delayed in achieving profitability.

Further, the cost

of compliance with post approval regulations may have a negative effect on our operations and business and could adversely impact our

business, financial condition, results of operations, stock price and prospects.

related to commercialization

face significant competition from other biopharmaceutical and biotechnology companies, academic institutions, government agencies, and

other research organizations, which may result in others discovering, developing or commercializing products more quickly or marketing

them more successfully than us.

If their product candidates are shown to be safer or more effective than ours, our commercial opportunity

may be reduced or eliminated.

development and commercialization of cancer immunotherapy products is characterized by rapidly advancing technologies, intense competition

and a strong emphasis on proprietary rights.

We face competition with respect to our current product candidates, and will face competition

with respect to any product candidates that we may seek to develop or commercialize in the future, from major biopharmaceutical companies,

specialty biopharmaceutical companies, and biotechnology companies worldwide.

There are a number of large biopharmaceutical and biotechnology

companies that currently market and sell products or are pursuing the development of products for the treatment of solid tumors, including

oncolytic immunotherapy and cancer vaccine approaches.

Potential competitors also include academic institutions, government agencies,

and other public and private research organizations that conduct research, seek patent protection, and establish collaborative arrangements

for research, development, manufacturing, and commercialization.

our product candidates are intended to be used in combination with other drugs with different mechanisms of action, if and when marketed

they will still compete with a number of drugs that are currently marketed or in development that also target cancer.

To compete effectively

with these drugs, our product candidates will need to demonstrate advantages in clinical efficacy and safety compared to these competitors

when used alone or in combination with other drugs.

commercial opportunities could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective,

have fewer or less severe side effects, are easier to administer or are less expensive alone or in combination with other therapies than

any products that we may develop alone or in combination with other therapies.

Our competitors also may obtain FDA or comparable foreign

regulatory authority approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors

establishing a strong market position before we are able to enter the market.

Further, depending on the specific competing product, earlier

approval of a competitor’s products could block us from receiving approval and could require that we change our development strategy.

In addition, our ability to compete may be affected in many cases by insurers or other third-party payors coverage decisions or third-party

intellectual property rights that another may allege are violated by our product candidates.

of the companies with which we are competing or may compete in the future have significantly greater financial resources and expertise

in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals, and marketing

approved products than we do.

Mergers and acquisitions in the biopharmaceutical and biotechnology industries may result in even more

resources being concentrated among a smaller number of our competitors.

Early stage companies may also prove to be significant competitors,

particularly through collaborative arrangements with large and established companies.

These third parties compete with us in recruiting

and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical

trials, as well as in developing or acquiring technologies complementary to, or necessary for, our programs.

If we are unable to successfully

compete with these companies our business, financial condition, results of operations, stock price and prospects may be materially harmed.

we are unable to establish effective marketing, sales and distribution capabilities or enter into agreements with third parties to market

and sell our product candidates, if they are approved, the revenues that we generate may be limited and we may never become profitable.

and when our product candidates receive marketing approval, we intend to commercialize our product candidates on our own in the United

States and potentially with pharmaceutical or biotechnology partners in other geographies.

In order to commercialize our products, we

must continue to build our marketing, sales, and distribution capabilities or make arrangements with third parties to perform these services,

and we may not be successful in doing so.

We have incurred and we expect we will continue to incur expenses prior to product launch or

even approval in order to recruit a sales force and develop a marketing and sales infrastructure.

If a commercial launch is delayed as

a result of FDA or comparable foreign regulatory authority requirements or other reasons, we would incur these expenses prior to being

able to realize any revenue from sales of our product candidates.

Our sales force and marketing teams may not be successful in commercializing

our product candidates.

This may be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing

may also or alternatively decide to collaborate with third-party marketing and sales organizations to commercialize any approved product

candidates in the United States, in which event, our ability to generate product revenues may be limited.

To the extent we rely on third

parties to commercialize any products for which we obtain regulatory approval, we may receive less revenues than if we commercialized

these products ourselves, which could materially harm our prospects.

In addition, we would have less control over the sales efforts of

any other third parties involved in our commercialization efforts, and could be held liable if they failed to comply with applicable

legal or regulatory requirements.

have no prior experience in the marketing, sale, and distribution of biopharmaceutical products, and there are significant risks involved

in building, managing, growing and operating a commercial infrastructure.

The establishment and development of commercial capabilities,

including compliance plans, to market any products we may develop is, and will continue to be expensive and time consuming and could

delay any product launch, and we may not be able to successfully develop this capability.

We have and will continue to compete with other

biopharmaceutical and biotechnology companies, including oncology-focused companies, to recruit, hire, train, manage, and retain marketing

and sales personnel, which is expensive and time consuming and could delay any product launch.

Developing our sales capabilities may

also divert resources and management attention away from product development.

the event we are unable to develop an effective marketing and sales infrastructure, we may not be able to commercialize our product candidates

in the United States or elsewhere in an effective manner, which could limit our ability to generate product revenues and materially harm

our business, financial condition, results of operations, stock price and prospects.

Factors that may inhibit our efforts to commercialize

our product candidates include:

the inability to recruit, train,

manage, and retain adequate numbers of effective sales and marketing personnel;

the inability of sales personnel to obtain access to

physicians or persuade adequate numbers of physicians to prescribe our product candidates;

our inability to effectively oversee

a geographically dispersed sales and marketing team;

the costs associated with training sales and marketing

personnel on legal and regulatory compliance matters and monitoring their actions;

an inability to secure adequate coverage and reimbursement

by government and private health plans;

the clinical indications for which the products are

approved and the claims that we may make for the products;

limitations or warnings, including distribution or

use restrictions, contained in the products’ approved labeling;

any distribution and use restrictions imposed by the

FDA or comparable foreign regulatory authorities or to which we agree as part of a mandatory REMS or voluntary risk management plan;

third-party intellectual property rights that another

may allege are violated by our product candidates;

liability for sales or marketing personnel who fail

to comply with the applicable legal and regulatory requirements;

the lack of complementary products to be offered by

sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines;

unforeseen costs and expenses associated with creating

an independent sales and marketing organization or engaging a contract sales organization.

we continue to evolve from a company primarily involved in research and development to a company also expected to be involved in commercialization,

we may encounter difficulties in managing our growth and expanding our operations successfully.

anticipate that, as our operations expand and, assuming that our development, testing, studies and trials are successful, we will need

to expand our internal manufacturing, marketing and sales capabilities.

Managing our future growth will impose significant added responsibilities

on members of our management team and will be time consuming and costly.

We must be able to manage our development efforts effectively;

manage our clinical trials effectively;

hire, train and integrate additional management, development, administrative and sales and marketing

and improve managerial, development, operational and finance systems, all of which may impose a strain on our administrative

and operational infrastructure.

product candidates are based on a novel approach to the treatment of cancer, which makes it difficult to predict the time and cost of

product candidate development.

can be no assurance that any development problems we experience in the future will not cause significant delays or unanticipated costs,

or that such development problems can be solved.

Should we encounter development problems, including unfavorable preclinical or clinical

trial results, the FDA and foreign regulatory authorities may refuse to approve our product candidates, or may require additional information,

tests, or trials, which could significantly delay product development and significantly increase our development costs.

Moreover, even

if we are able to provide the requested information or trials to the FDA, there would be no guarantee that the FDA would accept them

or approve our product candidates.

We may also experience delays in developing a sustainable, reproducible and scalable manufacturing

process, or developing or qualifying and validating product release assays, other testing and manufacturing methods, and our equipment

and facilities in a timely manner, which may prevent us from completing our clinical trials or commercializing our product candidates

on a timely or profitable basis, if at all.

addition, the clinical trial requirements of the FDA and comparable foreign regulatory authorities and the criteria these regulators

use to determine the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended

use and market of the potential products.

The FDA and comparable foreign regulatory authorities have limited experience with the approval

of oncolytic immunotherapies.

Limited immunotherapies have received FDA approval to date.

Any product candidates that are approved may

be subject to extensive post approval regulatory requirements, including requirements pertaining to manufacturing, distribution, and

We may need to devote significant time and resources to compliance with these requirements.

our product candidates do not achieve broad market acceptance, the revenues that we generate from their sales may be limited, and we

may never become profitable.

have never commercialized a product candidate for any indication.

Even if our product candidates are approved by the appropriate regulatory

authorities for marketing and sale, they may not gain acceptance among physicians, patients, third-party payors, and others in the medical

If any product candidates for which we obtain regulatory approval do not gain an adequate level of market acceptance, we could

be prevented from or significantly delayed in achieving profitability.

Additionally,

efforts to educate the medical community and third party payors on the benefits of our product candidates may require significant resources

and may not be successful.

If any of our product candidates is approved but does not achieve an adequate level of market acceptance,

we could be prevented from or significantly delayed in achieving profitability.

degree of market acceptance of any of our product candidates will depend on a number of factors, some of which are out of our control,

including the following:

the efficacy of our product

candidates in combination with marketed checkpoint blockade drugs;

the commercial success of the checkpoint blockade

drugs with which our products are co-administered;

the prevalence and severity of adverse events

associated with our product candidates or those products with which they are co-administered;

the clinical indications for which the products

are approved and the approved claims that we may make for the products;

limitations or warnings contained in the product’s

FDA-approved labeling or those of comparable foreign regulatory authorities, including potential limitations or warnings for our

product candidates that may be more restrictive than other competitive products;

changes in the standard of care for the targeted

indications for our product candidates, which could reduce the marketing impact of any claims that we could make following FDA approval

or approval by comparable foreign regulatory authorities, if obtained;

the relative convenience and ease of administration

of our product candidates by direct injection into tumors, a less common method for the administration of oncology therapies than

systemic administration, which may result in slower adoption of our therapies;

the relative convenience and ease of administration

of any products with which our product candidates are co-administered;

the cost of treatment compared with the economic

and clinical benefit of alternative treatments or therapies;

the availability of adequate coverage or reimbursement

by third parties, such as insurance companies and other healthcare payors, and by government healthcare programs, including Medicare

and Medicaid;

the price concessions required by third party

payors to obtain coverage;

the extent and strength of our marketing and

distribution of our product candidates;

the safety, efficacy, and other potential

advantages over, and availability of, alternative treatments already used or that may later be approved;

distribution and use restrictions imposed

by the FDA or comparable foreign regulatory authorities with respect to our product candidates or to which we agree as part of a

REMS or voluntary risk management plan;

the timing of market introduction of our product

candidates, as well as competitive products;

our ability to offer our product candidates

for sale at competitive prices;

the willingness of the target patient population

to try new therapies and of physicians to prescribe these therapies;

the extent and strength of our manufacturing

operations and our third-party manufacturer and supplier support;

the actions of companies that market any products

with which our product candidates are co-administered;

the approval of other new products;

adverse publicity about our product candidates

or any products with which they are co-administered, or favorable publicity about competitive products;

potential product liability claims.

successful commercialization of our product candidates, if approved, will depend in part on the extent to which government authorities

and health insurers establish adequate reimbursement levels and pricing policies.

of any approved drug candidate will depend in part on the availability of coverage and reimbursement from third-party payers such as

government insurance programs, including, but not limited to, Medicare and Medicaid, private health insurers, health maintenance organizations

and other health care related organizations, who are increasingly challenging the price of medical products and services.

coverage and reimbursement may be uncertain.

Adoption of any drug by the medical community may be limited if third-party payers will

not offer adequate formulary coverage.

Additionally, significant uncertainty exists as to the reimbursement status of newly-approved

Cost control initiatives may decrease coverage and payment levels for any drug and, in turn, the price that we will be able to

charge and/or the volume of our sales.

We are unable to predict all changes to the coverage or reimbursement methodologies that will

be applied by private or government payers.

Any denial of private or government payer coverage or inadequate reimbursement could harm

our business and reduce our revenue.

addition, both the federal and state governments in the United States and foreign governments continue to propose and pass new legislation,

regulations, and policies affecting coverage and reimbursement rates, which are designed to contain or reduce the cost of health care.

Further federal and state proposals and healthcare reforms are likely, which could limit the prices that can be charged for the product

candidates that we develop and may further limit our commercial opportunity.

For example, the Inflation Reduction Act of 2022, or IRA,

includes several measures intended to lower the cost of prescription drugs and related healthcare reforms, including limits on price

increases, inflation and non-compliance penalties, and subjecting an escalating number of drugs to annual maximum fair price negotiations

We cannot be sure whether additional legislation related to the IRA will be issued or enacted, or what impact, if any, such

changes will have on the profitability of any of our drug candidates, if approved for commercial use, in the future.

There also may be

future changes unrelated to the IRA that result in reductions in potential coverage and reimbursement levels for our product candidates,

if approved and commercialized, and we cannot predict the scope of any future changes or the impact that those changes would have on

our operations.

Similarly, several states have established prescription drug affordability boards that set upper payment limits (maximum

prices that can be charged for specific drugs) for select high-cost drugs.

We cannot be sure whether additional state legislation related

to price caps will be enacted, or what impact, if any, such changes will have on the profitability of any of our drug candidates, if

approved for commercial use, in the future.

future reimbursement for approved product candidates, if any, is substantially less than we project, or rebate and/or discount, or fees

and obligations associated with them are substantially greater than we expect, our future net revenue and profitability could be materially

size of the potential market for our product candidates is difficult to estimate and, if any of our assumptions are inaccurate, the actual

markets for our product candidates may be smaller than our estimates.

potential market opportunities for our product candidates are difficult to estimate and will depend in large part on the drugs with which

our product candidates are co-administered and the success of competing therapies and therapeutic approaches.

Our estimates of the potential

market opportunities are predicated on many assumptions, which may include industry knowledge and publications, third-party research

reports, and surveys of clinics.

Although we believe that our internal assumptions are reasonable, these assumptions involve the exercise

of significant judgment on the part of our management, are inherently uncertain, and their reasonableness has not been assessed by an

independent source.

If any of the assumptions proves to be inaccurate, the actual markets for our product candidates could be smaller

than our estimates of the potential market opportunities.

ability to grow depends on several factors, including successful product development, user adoption, access to capital, technological

performance, regulatory developments, and market conditions affecting digital assets.

If we are unable to successfully execute our development

plans, attract users, or compete effectively, our growth prospects may be limited.

Additionally, evolving regulatory frameworks, economic

conditions, or declines in digital asset market activity may constrain our ability to expand operations or generate revenue.

customer-facing platforms may not achieve user adoption or generate revenue.

success of BesTrade and our planned RWA + EAI initiatives depends on our ability to attract and retain users.

User adoption may be adversely

affected by competition, market volatility, technological limitations, regulatory changes, or security concerns.

If we are unable to

achieve sufficient user engagement, our ability to generate subscription-based or other revenue from these platforms may be materially

software development efforts may be delayed, exceed budget, or fail to perform as intended.

development of BesTrade and RWA + EAI involves technical complexity, integration challenges, and evolving product requirements.

timelines may be extended due to technical obstacles, changes in regulatory requirements, resource constraints, or unforeseen operational

Internally developed systems may contain errors, defects, or vulnerabilities that could result in operational disruption, reputational

harm, or financial loss.

AI Blockchain platform is internally developed and may not function as intended.

Blockchain is used internally to support digital asset portfolio monitoring, analytics, and operational oversight.

As an internally developed

and evolving system, it may contain errors, design limitations, or cybersecurity vulnerabilities.

Failures or deficiencies in internal

systems could impair decision-making, result in inaccurate reporting, or expose us to financial or operational risk.

are exposed to significant digital asset price volatility.

maintain digital assets as part of our treasury and investment activities, including our internally managed C10 portfolio.

Digital asset

markets have historically experienced significant price volatility.

Market fluctuations may materially impact the fair value of our holdings

and could adversely affect our financial condition and results of operations.

Digital asset prices may be influenced by factors beyond

our control, including regulatory developments, macroeconomic conditions, market sentiment, technological changes, and security events.

regulatory environment surrounding digital assets, tokenization, and AI-enabled financial tools is evolving and uncertain.

asset markets and tokenization initiatives are subject to evolving regulatory frameworks in the United States and internationally.

authorities may impose new or additional requirements relating to securities laws, commodities laws, anti-money laundering compliance,

custody requirements, or other regulatory regimes.

Changes in applicable regulations or regulatory interpretations could limit our ability

to operate our platforms as currently contemplated, increase compliance costs, or require modification of our business model.

platforms could be subject to regulatory classification that imposes additional obligations.

is designed to provide analytics and informational tools and does not operate as a broker, exchange, custodian, or trading venue.

regulatory authorities may interpret aspects of our activities differently.

If regulators were to determine that our activities require

registration, licensing, or compliance with additional regulatory requirements, we could incur substantial costs, face operational limitations,

or be required to modify or discontinue certain activities.

depend on third-party service providers for technology infrastructure and digital asset custody.

rely on third-party providers for hosting infrastructure, data services, and, where applicable, digital asset custody and related services.

The failure, disruption, or insolvency of these providers, or cybersecurity incidents affecting them, could adversely affect our operations,

financial condition, and reputation.

business and operations could suffer in the event of computer system failures, cyberattacks, or deficiencies in our cybersecurity.

operations depend on the secure and reliable performance of our technology systems and infrastructure.

Cybersecurity incidents, including

unauthorized access, malware attacks, system disruptions, or data breaches, could result in operational interruptions, loss of digital

assets, regulatory scrutiny, litigation, or reputational harm.

As our platforms develop and potentially expand user engagement, our exposure

to cybersecurity risk may increase.

“C10” Treasury strategy subjects our financial condition to extreme market volatility.

hold a concentrated basket of digital assets.

Because our Common Stock may trade as a high-beta proxy for these assets, our stock

price may fluctuate significantly based on global crypto market swings, completely independent of our AI infrastructure.

Concentration

of Control and Sole Custody of Digital Assets May Expose the Company to Significant Financial and Operational Risks

Crypto-Centric

Pursuant to the Lead Investor Agreement, the Company is required to adopt a Treasury Reserve Policy that establishes

cryptocurrencies as our primary ongoing treasury reserve asset.

Operational Control:

The Faraday-appointed Co-Chief Executive Officer has been granted sole responsible for all of the Company’s

business operations, including crypto-related businesses, with the sole exception of the legacy medical-related business.

Access to Digital Assets:

The Lead Investor Agreement states that the Faraday-appointed Co-CEO shall have sole access to all crypto-related

accounts of the Company, subject to delegation.

Point of Failure:

If the Co-CEO becomes incapacitated, or if there is a security breach, loss of credentials, or misappropriation

involving these specific accounts, we do not have an immediate, native backup mechanism to access our own treasury assets.

event could result in the total and irretrievable loss of our primary treasury assets, materially harming our financial condition

and operational viability.

We may fail to execute our pivot from therapeutics to Web3 .

We are undergoing a transition from a clinical-stage oncology company (Qualigen) to an AI and digital asset infrastructure ecosystem provider.

There is no guarantee that our management’s historical experience will translate to success in the decentralized infrastructure space.

have in the past, and may in the future, enter into partnerships, collaborations, joint ventures, or strategic alliances with third parties.

If we are unsuccessful in establishing or maintaining strategic relationships with these third parties or if these third parties fail

to deliver certain services, our business, operating results, and financial condition could be adversely affected.

have in the past, and may in the future, enter partnerships, collaborations, joint ventures, or strategic alliances with third parties

in connection with the development, operation, and enhancement of our platform and products and the provision of our services.

strategic relationships with third parties and negotiating and documenting relationships with them may be time-consuming and complex

and may distract management.

Moreover, we may be delayed, or not be successful, in achieving the objectives that we anticipate as a result

of such strategic relationships.

For example, we rely on our strategic relationship with Faraday Future to fuel our decentralized AI

models and on-chain strategies.

If Faraday Future experiences financial distress, supply chain disruptions, or shifts its strategic priorities

away from our partnership, we may lose access to the critical data required for our EAIRWA ecosystem.

In evaluating counterparties in

connection with partnerships, collaborations, joint ventures or strategic alliances, we consider a wide range of economic, legal and

regulatory criteria depending on the nature of such relationship, including the counterparties’ reputation, operating results and

financial condition, operational ability to satisfy our and our customers’ needs in a timely manner, efficiency and reliability

of systems, certifications costs to us or to our customers, and licensure and compliance status.

Despite this evaluation, third parties

may still not meet our or our customers’ needs, which may adversely affect our ability to deliver products and services to customers,

and could adversely affect our business, operating results, and financial condition.

Counterparties to any strategic relationship may

have economic or business interests or goals that are, or that may become, inconsistent with our business interests or goals, and may

subject us to additional risks to the extent any such third party becomes the subject of negative publicity, faces its own litigation

or regulatory challenges, or faces other adverse circumstances.

Conflicts may arise with our strategic partners, such as the interpretation

of significant terms under any agreement, which may result in litigation or arbitration which would increase our expenses and divert

the attention of our management.

If we are unsuccessful in establishing or maintaining strategic relationships with third parties, our

ability to compete in the marketplace or to grow our revenue could be impaired and our business, operating results, and financial condition

could be adversely affected.

future development and growth of crypto is subject to a variety of factors that are difficult to predict and evaluate.

If crypto does

not grow as we expect, our business, operating results, and financial condition could be adversely affected.

assets built on blockchain technology were only introduced in 2008 and remain in the early stages of development.

In addition, different

crypto assets are designed for different purposes.

The further growth and development of any crypto assets and their underlying networks

and other cryptographic and algorithmic protocols governing the creation, transfer, and usage of crypto assets represent a new and evolving

paradigm that is subject to a variety of factors that are difficult to evaluate.

operate in a highly competitive industry and we compete against unregulated or less regulated companies and companies with greater financial

and other resources, and our business, operating results, and financial condition could be adversely affected if we are unable to compete

crypto industry is highly innovative, rapidly evolving, and characterized by healthy competition, experimentation, changing customer

needs, frequent introductions of new products and services, and subject to uncertain and evolving industry and regulatory

requirements.

We expect competition to intensify in the future as existing and new competitors introduce new products or enhance

existing products.

We face significant competition from a variety of companies around the world, in particular those located outside

the United States, who at times are and may in the future be subject to significantly less stringent regulatory and compliance

requirements in their local jurisdictions.

Their business models rely on being unregulated or only regulated in a small number of

lower compliance jurisdictions, whilst also offering their products in highly regulated jurisdictions, including the United States,

without necessarily complying with the relevant regulatory requirements in such jurisdictions.

Given the uneven enforcement by

United States and foreign regulators, many of these competitors have been able to operate from offshore while offering large numbers

of products and services to consumers, including in the United States, without complying with the relevant licensing and other

requirements in these jurisdictions, and historically without penalty.

We also have expended significant managerial, operational,

and compliance costs to comply with laws and regulations applicable to us in the jurisdictions in which we operate, and expect to

continue to incur significant costs to comply with these requirements, which these unregulated or less regulated competitors have

not had to incur.

As regulations and compliance requirements in the United States become clearer, we may face increased competition

from companies based in the United States.

Our current and potential competitors may establish cooperative relationships among

themselves or with third parties that may further enhance their resources.

If we are unable to compete successfully, or if competing

successfully requires us to take costly actions in response to the actions of our competitors, our business, operating results, and

financial condition could be adversely affected.

we cannot keep pace with rapid industry changes to provide new and innovative products and services, the use of our products and services,

and consequently our net revenue, could decline, which could adversely affect our business, operating results, and financial

industry has been characterized by many rapid, significant, and disruptive products and services in recent years.

We expect new services

and technologies to continue to emerge and evolve, which may be superior to, or render obsolete, the products and services that we currently

For example, decentralized networks and other disruptive technologies such as generative AI may fundamentally alter the use

of our products or services in unpredictable ways.

We cannot predict the effects of new services and technologies on our business.

our ability to grow our customer base and net revenue will depend heavily on our ability to innovate and create successful new products

and services, both independently and in conjunction with third-party developers.

In particular, developing and incorporating new products

and services into our business may require substantial expenditures, take considerable time, and ultimately may not be successful.

new products or services could fail to attract customers, generate revenue, or perform or integrate well with third-party applications

and platforms.

In addition, our ability to adapt and compete with new products and services may be inhibited by regulatory requirements

and general uncertainty in the law or other factors.

Moreover, we must continue to enhance our technical infrastructure and other technology

offerings to remain competitive and maintain a platform that has the required functionality, performance, capacity, security, and speed

to attract and retain customers.

As a result, we expect to incur significant costs and expenses to develop and upgrade our technical

infrastructure to meet the evolving needs of the industry.

Our success will depend on our ability to develop, scale, and incorporate

new offerings and adapt to technological changes and evolving industry practices.

If we are unable to do so in a timely or cost-effective

manner, our ability to successfully compete, to retain existing customers, and to attract new customers may be impacted and our business,

operating results, and financial condition could be adversely affected.

particular crypto asset, product or service’s status as a “security” in any relevant jurisdiction is subject to a high

degree of uncertainty and if we are unable to properly characterize a crypto asset or product offering, we may be subject to regulatory

scrutiny, inquiries, investigations, fines, and other penalties, which could adversely affect our business, operating results, and financial

or not an asset, product, or service is a security or constitutes a securities offering under federal securities laws is ultimately determined

by a federal court.

The legal test for determining whether any given crypto asset, product, or service is an investment contract security

was set forth in the 1946 Supreme Court case SEC v.

and whether any given crypto asset, product, or service is

a note in the 1990 Supreme Court case Reves v.

Ernst & Young .

The legal tests for determining whether any given crypto asset,

product, or service is a security requires a highly complex, fact-driven analysis.

Accordingly, whether any given crypto asset, product

or service would be ultimately deemed by a federal court to be a security is uncertain and difficult to predict notwithstanding the conclusions

of the SEC or any conclusions we may draw based on our risk-based assessment regarding the likelihood that a particular crypto asset,

product or service could be deemed a “security” or “securities offering” under applicable laws.

theft, loss, or destruction of private keys required to access any crypto assets held in custody for our own account.

If we are unable

to access our private keys or if we experience a hack or other data loss relating to our ability to access any crypto assets, it could

cause regulatory scrutiny, reputational harm, and other losses.

assets are generally controllable only by the possessor of the unique private key relating to the digital wallet in which the crypto

assets are held.

While blockchain protocols typically require public addresses to be published when used in a transaction, private keys

must be secured and kept private in order to prevent a third party from accessing the crypto assets held in such a wallet.

To the extent

that any of the private keys relating to our wallets containing crypto assets held for our own account is lost, destroyed, or otherwise

compromised or unavailable, and no backup of the private key is accessible, we will be unable to access the crypto assets held in the

related wallet.

Further, we cannot provide assurance that our wallets will not be hacked or compromised.

Crypto assets and blockchain

technologies have been, and may in the future be, subject to security breaches, hacking, or other malicious activities.

to our limited operating history, it may be difficult to evaluate our business and future prospects, and we may not be able to achieve

or maintain profitability in any given period .

began to transition our operations in 2025 and since then our business model has continued to evolve.

Our limited operating history

and the volatile nature of our business make it difficult to evaluate our current business and our future prospects.

encountered and will continue to encounter risks and difficulties as described in this section.

If we do not manage these risks

successfully, our business, operating results, and financial condition could be adversely affected.

business metrics and other estimates are subject to inherent challenges in measurement and change as our business evolves, and our business,

operating results, and financial condition could be adversely affected by real or perceived inaccuracies in those metrics or any changes

in metrics we disclose.

regularly review our key business metrics to evaluate our business, measure our performance, identify trends affecting our business,

and make strategic decisions.

These key business metrics are calculated using internal company data and have not been validated by an

independent third-party.

While these numbers are based on what we believe to be reasonable estimates for the applicable period of measurement

at the time of reporting, there are inherent challenges in such measurements.

If we fail to maintain an effective analytics platform,

our key business metrics calculations may be inaccurate, and we may not be able to identify those inaccuracies.

Additionally, we may

in the future calculate certain key business metrics using third-party data.

While we believe the third-party data we have used in the

past or may use in the future is reliable, we have not independently verified and may not in the future independently verify the accuracy

or completeness of the data contained in such sources and there can be no assurance that such data is free of error.

Any inaccuracy in

the third-party data we use could cause us to overstate or understate our key business metrics.

We generally will not update previously

disclosed key business metrics for any such inaccuracies or adjustments that are immaterial.

We may change our key business metrics from

time to time, which may be perceived negatively.

Given the rapid evolution of the crypto markets and our revenue sources, we regularly

evaluate whether our key business metrics remain meaningful indicators of the performance of our business.

Further if investors or the

media perceive any changes to our key business metrics disclosures negatively, our business, operating results, and financial condition

could be adversely affected.

may suffer losses due to abrupt and erratic market movements.

crypto asset market has been characterized by significant volatility and unexpected price movements, and has experienced significant

declines in the past.

economic conditions could adversely affect our business.

performance is subject to general economic conditions, and their impact on the crypto asset markets and our customers.

The United States

and other key international economies have experienced cyclical downturns from time to time in which economic activity declined resulting

in lower consumption rates, restricted credit, reduced profitability, weaknesses in financial markets, bankruptcies, and overall uncertainty

with respect to the economy.

Adverse general economic conditions have impacted in the past, and may impact in the future, the cryptoeconomy,

although the extent of such impacts remains uncertain and dependent on a variety of factors, including market adoption of crypto assets,

global trends in the cryptoeconomy, central bank monetary policies, instability in the global banking system, volatility and disruptions

in the capital and credit markets, and other events beyond our control.

Geopolitical developments, such as trade wars and foreign exchange

limitations can also increase the severity and levels of unpredictability globally and increase the volatility of global financial and

crypto asset markets.

To the extent general economic conditions and crypto assets markets materially deteriorate or decline for a prolonged

period, our ability to generate revenue and to attract and retain customers could suffer and our business, operating results and financial

condition could be adversely affected.

Moreover, even if general economic conditions were to improve following any such deterioration,

there is no guarantee that the cryptoeconomy would similarly improve.

we fail to maintain an effective system of disclosure controls and procedures and internal control over our financial reporting, our

ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired.

a public company we incur significant legal, accounting, and other expenses.

The Sarbanes-Oxley Act of 2002 and related rules of the

SEC require, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.

In order to maintain and, if required, improve our disclosure controls and procedures and internal control over financial reporting to

meet this standard, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related

costs and significant management oversight.

If we encounter material weaknesses or deficiencies in our internal control over financial

reporting, we may not detect errors on a timely basis and our Consolidated Financial Statements may be materially misstated.

to implement and maintain effective internal control over financial reporting could also adversely affect the results of periodic management

evaluations and annual independent registered public accounting firm attestation reports regarding the effectiveness of our internal

control over financial reporting that are required to be included in our periodic reports filed with the SEC.

Ineffective disclosure

controls and procedures or internal control over financial reporting may adversely affect investor confidence in us and, as a result,

negatively impact the price of our common stock and have a material and adverse effect on our business, operating results, and

financial condition.

may require additional capital to support business growth, and this capital might not be available.

intend to continue to make investments in our business, which investments may require us to secure additional funds.

Additional financing

may not be available on terms favorable to us, if at all, including due to general macroeconomic conditions, crypto market conditions

and any disruptions in the crypto market, instability in the global banking system, increasing regulatory uncertainty and scrutiny or

other unforeseen factors.

In the event of a downgrade of our credit rating, our ability to raise additional financing may be adversely

affected and any future debt offerings or credit arrangements we propose to enter may be on less favorable terms or terms that may not

be acceptable to us.

SEC Enforcement Actions Against Our Co-CEO, Chief Advisor, and Lead Investor Could Materially Disrupt Our Operations and Restrict Access

to Our Treasury Assets.

June 2025, FF (the “Lead Investor”), our Co-CEO (Jiawei Wang), and our Chief Advisor (YT Jia) received SEC Wells Notices regarding

alleged federal securities law violations.

The SEC is considering seeking remedies that include barring Mr.

Jia from serving

as officers or directors of a public company.

Pursuant to our Lead Investor Agreement, Mr.

Wang is solely responsible for our non-medical

business operations.

He has also been granted sole access, subject to delegation, to all of our crypto-related accounts.

If the SEC successfully

pursues a D&O bar against Mr.

Wang, we could face an immediate crisis in executive leadership and potential delays or inability to

access our primary treasury reserve assets.

An SEC enforcement action against Mr.

Jia could impair our damage our reputation with institutional

Because FF is our Lead Investor and controls significant board and operational appointments, any financial penalties,

injunctions, or reputational damage suffered by FF as a result of the SEC’s investigation could materially and adversely affect

our business, capital structure, and ability to raise future funding.

have been involved, and may continue to be involved, in disputes, claims or proceedings arising from our operations or class actions

from time to time, which could result in significant liabilities and reputational harm and could materially and adversely affect our

business, financial condition and results of operations

may be involved in disputes, claims or proceedings arising out of our operations.

In addition, we may have disagreements with regulatory

bodies in the course of our operations, which may subject us to administrative proceedings and unfavorable orders, directives or decrees

that may result in financial losses.

Ongoing disputes, claims or proceedings may divert our management’s attention and consume

their time and our other resources.

the past, shareholders of public companies have often brought securities class action suits against an issuer following periods of instability

in the market price of an issuer’s securities, or after the publication of third-party research reports.

As of the date of this

Annual Report, we are not aware of any lawsuits threatened or filed against us based on any alleged violation of securities laws.

cannot assure you that there would not be any future claims against us or that we would successfully defend against them.

Any such suit,

whether or not successful, could harm our reputation, result in share price volatility and a loss of customers, and restrict our ability

to raise capital in the future.

Even if claims do not result in litigation or are resolved in our favor, these claims, and the time and

resources necessary to resolve them, could divert the resources of our management and require significant expenditures, which could prevent

us from competing effectively and could have an adverse effect on our business, operating results, and financial condition.

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.

Furthermore, any disputes, claims or proceedings which are initially not of material

importance may escalate and become important to us, due to a variety of factors, such as the facts and circumstances of the cases, the

likelihood of loss, the monetary amount at stake and the parties involved.

As of the date of this Annual Report, we are not able to quantify

the likelihood or amount of exposure from any of these potential actions.

publicity arising from disputes, claims or proceedings may damage our reputation and adversely affect the image of our brands and products.

In addition, if any verdict or award is rendered against us, we could be required to pay significant monetary damages, assume other liabilities

and even to suspend or terminate the related business ventures or projects.

Consequently, our business, results of operations and financial

condition may be materially and adversely affected.

Related to Our Intellectual Property

we are unable to obtain, maintain, and enforce adequate intellectual property protection for our core technologies, our competitors could

develop and commercialize similar products, which would materially and adversely affect our business.

success depends in large part on our ability to protect our proprietary technology, brand, trade secrets, and institutional knowledge

We rely on a combination of patents, trademarks, copyrights, trade secrets, and confidentiality and license agreements to protect

our artificial intelligence and blockchain-based innovations.

These critical assets include our protocol, infrastructure, and application

layer technologies , as well as current and future developments related to our RWA and EAI ecosystem.

the patent prosecution process is expensive, time-consuming, and complex, particularly within the rapidly evolving Web3 and cryptocurrency

environments.

We may not be able to file, prosecute, maintain, or enforce all necessary patent applications globally at a reasonable

cost or in a timely manner.

It is possible that our pending or future patent applications will not result in issued patents, or that

our intellectual property rights could be challenged, narrowed, invalidated, or circumvented by competitors developing alternative decentralized

Furthermore, changes in U.S.

patent law and ongoing patent reform may increase the uncertainty and costs associated with obtaining

and defending patents.

by third parties that we infringe upon their intellectual property rights could be costly, time-consuming, and materially and adversely

affect our business.

artificial intelligence, cryptocurrency, and blockchain industries are characterized by rapid technological advancement, a proliferation

of patents, and frequent, complex litigation regarding intellectual property rights.

As we execute our strategy, we may become subject

to adversarial proceedings if competitors or non-practicing entities assert that our products or technologiesinfringe upon their proprietary

against any such claims of infringement could cause us to incur substantial legal costs, divert the attention of our management and technical

personnel, and substantially increase our operating losses.

If we are found to infringe a third party’s valid intellectual property

rights, we could be subject to significant monetary damages, enjoined from developing or commercializing the infringing technologies,

or forced to obtain costly licenses, which may not be available on commercially reasonable terms.

heavily rely on trade secrets and confidentiality agreements to safeguard our competitive advantage, and these measures may not adequately

protect our proprietary information.

addition to patent protection, we rely on the protection of trade secrets, know-how, and confidential proprietary information to safeguard

our AI-driven trading infrastructure and decentralized technology protocols.

To maintain the confidentiality of these assets, including

the algorithms powering the [___] ’s execution, we rely in part on non-disclosure agreements with our employees, outside developers,

and partners within the AIxC Labs ecosystem.

these precautions, these agreements may not effectively prevent the unauthorized disclosure of confidential information.

claim of misappropriation is inherently difficult and expensive.

Because we expect to rely on third parties, such as global stablecoin

issuers, the need to share confidential information increases the risk that our trade secrets could become known by competitors.

lose protection for our trade secrets, the value of our technology would be greatly reduced, severely harming our ability to build a

global leading ecosystem that integrates AI, crypto, and blockchain.

on intellectual property protection in certain jurisdictions outside the United States could adversely affect our global competitive

prosecuting, and defending our intellectual property across our global digital ecosystem is prohibitively expensive.

We face significant

difficulties in obtaining and enforcing our rights in jurisdictions outside the United States, where legal systems may not favor the

enforcement of such rights.

Competitors may use our technology in these regions to develop competing products.

Efforts to enforce our

rights abroad can be time-consuming and expose us to risks of invalidation or counterclaims, potentially reducing our commercial advantage

in key foreign markets.

requirements of being a public company may strain our resources and divert management’s attention.

a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley

Act”), the Dodd-Frank Wall Street Reform and Consumer Protection Act and other applicable securities rules and regulations.

Exchange Act requires, among other things, that we file annual and current reports with the SEC with respect to our business and operating

Compliance with these rules and regulations increases our legal and financial compliance costs, makes some activities more difficult,

time-consuming, or costly, and increases demand on our systems and resources.

a result of disclosure of information in this Annual Report and in filings required of a public company, our business and financial condition

is more visible, which we believe may result in threatened or actual litigation, including by competitors and other third parties.

such claims are successful, our business and operating results could be harmed, and even if the claims do not result in litigation or

are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert resources of our management

and harm our business and operating results.

of rapid growth and expansion could place a significant strain on our resources, including our employee base, which could negatively

impact our operating results.

recent strategic transition into the Web3 and AI sectors to become a gateway to the AI Web3 world places a significant strain and demands

on our management, our operational and financial resources, customer operations, research and development, sales and marketing, administrative,

and other resources.

To manage our possible future growth effectively, we will be required to continue to improve our management, operational

and financial systems.

Future growth would also require us to successfully hire, train, motivate and manage our employees.

our continued growth and the evolution of our business plan will require significant additional management, technical and administrative

If we are unable to manage our growth successfully, we may not be able to effectively manage the growth and evolution of our

current business and our operating results could suffer.

Macroeconomic

and financial market disruptions may adversely affect our liquidity, operations, and results.

in global financial markets, including volatility in equity and digital asset prices and reduced availability of capital, could limit

our access to financing, increase our cost of capital, and disrupt our customers and partners.

Stress affecting banks and payment partners,

as well as crypto market intermediaries such as exchanges, lenders, stablecoin issuers, and custodians, could impair our liquidity, reduce

customer activity, and negatively impact our operations.

persistent inflation, interest rate changes, geopolitical instability, sanctions and supply chain constraints may reduce customer spending,

trading volumes, and demand for our products and services.

These conditions can also lengthen payment cycles, increase credit losses

and write-offs, and constrain working capital.

If capital markets tighten, we may be unable to raise funds on acceptable terms or at

all, limiting our ability to fund operations, invest, or pursue growth opportunities, including the necessary funding to pursue our strategic

investments in the technology infrastructure or completion of our RWA tokenization initiatives involving FFAI stock.

Any of these factors

could materially and adversely affect our business, financial condition, results of operations, and prospects.

public scrutiny and negative publicity could damage our reputation and adversely affect our business and prospects.

Characteristics

of the crypto ecosystem, including decentralization, cross-border activity, and pseudonymous transactions, can attract heightened attention

from the public, regulators, and the media.

As our business expands to include the Web3 Store and RWA + EAI ecosystem development, we

may face increased scrutiny from regulators in existing and new markets.

Allegations or negative publicity regarding platform failures,

security incidents, or regulatory actions in the broader crypto industry, whether or not accurate, can lead to government inquiries,

increased oversight, and reputational harm.

This scrutiny could deter customers and partners from utilizing our AI-driven trading infrastructure,

dampening demand for our services.

Responding to inquiries or litigation can be costly and divert management’s attention, and adverse

perceptions could negatively impact the market price of our securities.

data and information in this Annual Report were obtained from third-party sources and were not independently verified by us.

Annual Report includes data and information from publicly available third party publications and reports.

These sources often include

projections based on assumptions that may not materialize, and markets relevant to our business, including digital asset and financial

technology markets, may not grow at the rates projected or at all.

Broader macroeconomic, regulatory, and industry specific factors discussed

in this report introduce uncertainty that could cause actual outcomes to differ materially from projections.

have not independently verified the third party data and information included here.

Such data may have been collected using methodologies

different from our own, and while these publications often state that their information is believed to be reliable, accuracy and completeness

are not guaranteed.

You should not place undue reliance on third party data or projections in this report.

Related to the Ownership of Our Securities

2 unchanged sentences

remain available for issuance, including shares of common stock issuable upon the exercise of outstanding derivative securities.

management will continue to have broad discretion to issue shares of our common stock in a range of transactions, including capital-raising

Our management will continue to have broad discretion to issue shares of our common stock in a range of transactions, including capital-raising

transactions, mergers, acquisitions and other transactions, without obtaining stockholder approval, unless stockholder approval is required

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors