What changed in this filing

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Item 1. Business

2021-03-10 compared with 2020-03-13 · 261 added, 232 removed, 28 unchanged (95% of the section changed)

currency is rounded to the nearest thousands, except share and per share amounts.)

(All currency is rounded to the nearest

thousand, except share and per share amounts.)

Creative Realities, Inc.

is a Minnesota corporation (the “Company”)

that provides innovative digital marketing technology and solutions to retail companies, individual retail brands, enterprises

is a Minnesota

corporation that provides innovative digital marketing technology solutions to a broad range of companies, individual brands, enterprises,

and organizations throughout the United States and in certain international markets.

The Company has expertise in a broad range

of existing and emerging digital marketing technologies, as well as the related media management and distribution software platforms

and networks, device management, product management, customized software service layers, systems, experiences, workflows, and integrated

We have expertise in a broad range of existing

and emerging digital marketing technologies across approximately 15 vertical markets, as well as the related media management and

distribution software platforms and networks, device and content management, product management, customized software service layers,

systems, experiences, workflows, and integrated solutions.

Our technology and solutions include:

digital merchandising systems and omni-channel customer engagement systems, interactive

digital shopping assistants, advisors and kiosks, and other interactive marketing technologies such as mobile, social media, point-of-sale

transactions, beaconing and web-based media that enable our customers to transform how they engage with consumers.

We have expertise

in a broad range of existing and emerging digital marketing technologies, as well as the following related aspects of our business:

content, network management, and connected device software and firmware platforms;

customized software service layers;

digital media workflows;

and proprietary processes and automation tools.

We believe we are one of the world’s

leading interactive marketing technology companies that focuses on the retail shopper experience by helping retailers and brands

use the latest technologies to create better shopping experiences.

November 20, 2018, we closed on our acquisition of Allure Global Solutions, Inc.

(the “Allure Acquisition”).

the Allure Acquisition expanded our operations, geographical footprint and customer base and also enhanced our current product

offerings, the core business of Allure is consistent with the operations of Creative Realties, Inc.

main operations are conducted directly through Creative Realities, Inc., and under our wholly owned subsidiaries Allure Global

Solutions, Inc., a Georgia corporation, Creative Realities Canada, Inc., a Canadian corporation, and ConeXus World Global, LLC,

a Kentucky limited liability company.

Our other wholly owned subsidiary Creative Realities, LLC, a Delaware limited liability

company, has been effectively dormant since October 2015, the date of the merger with ConeXus World Global, LLC.

generate revenue in this business by:

with our customers to determine the technologies and solutions required to achieve their specific goals, strategies and objectives;

our customers’

digital merchandising systems

and omni-channel customer engagement systems;

content creation, production and scheduling programs and systems;

a comprehensive

series of recurring maintenance, support, and field service offerings;

interactive digital shopping assistants, advisors and kiosks;

and, other interactive marketing technologies such as mobile, social media, point-of-sale transactions, beaconing and web-based

media that enable our customers to transform how they engage with consumers.

Our main operations are conducted directly

through Creative Realities, Inc.

and our wholly owned subsidiary Creative Realities Canada, Inc., a Canadian corporation.

wholly owned subsidiaries are effectively dormant:

Creative Realities, LLC, a Delaware limited liability company, ConeXus World

Global, LLC, a Kentucky limited liability company, and Allure Global Solutions, Inc., a Georgia corporation.

We generate revenue by:

consulting with our customers to determine the technologies and solutions required to achieve their specific goals, strategies, and objectives;

designing our customers’

digital marketing experiences, content, and interfaces;

the systems architecture delivering the digital marketing experiences we design –

engineering the systems architecture delivering the digital marketing experiences we design –

both software and hardware –

and integrating those systems into a customized, reliable, and effective digital marketing experience;

the efficient, timely and cost-effective deployment of our digital marketing technology solutions for our customers;

and updating the content of our digital marketing technology solutions using a suite of advanced media, content and network

management software products;

our customers’

managing the efficient, timely and cost-effective deployment of our digital marketing technology solutions for our customers;

delivering and updating the content of our digital marketing technology solutions using a suite of advanced media, content, and network management software products;

maintaining our customers’

digital marketing technology solutions by:

providing content production and related services;

additional software-based features and functionality;

creating additional software-based features and functionality;

hosting the solutions;

monitoring solution service levels;

and responding

to and/or managing remote or onsite field service maintenance, troubleshooting and support calls.

activities generate revenue through:

and responding to and/or managing remote or onsite field service maintenance, troubleshooting and support calls.

These activities generate revenue through

bundled-solution sales;

consulting services, experience design, content development and production,

software development, engineering, implementation, and field services;

software license fees;

and maintenance and support services

related to our software, managed systems and solutions.

currently market and sell our technology and solutions primarily through our sales and business development personnel, but we

also utilize agents, strategic partners, and lead generators who provide us with access to additional sales, business development

and licensing opportunities.

digital marketing technology solutions have application in a wide variety of industries.

The industries in which we sell

our solutions are established and include automotive, apparel & accessories, banking, baby/children, beauty, CPG, department

stores, digital out-of-home (“DOOH”), electronics, fashion, fitness, foodservice/quick service restaurant (“QSR”),

financial services, gaming, luxury, mass merchants, mobile operators, and pharmacy retail;

however, the planning, development,

implementation and maintenance of technology-enabled experiences involving combinations of digital marketing technologies is relatively

new and evolving.

Moreover, a number of participants in these industries have only recently started considering or expanding

the adoption of these types of technologies, solutions and experiences as part of their overall marketing strategies.

a result, we remain without an established history of profitability.

believe that the adoption and evolution of digital marketing technology solutions will increase substantially in years to come

both in the industries in which we currently focus and in others.

We also believe that adoption of our solutions depends not only

upon the services and solutions that we provide but also upon the cost of hardware used to process and display content.

the costs of hardware configurations and software media players have historically decreased and we believe they will continue

to do so at an accelerating rate, flat panel displays and players typically constitute a large portion of the expenditure customers

make relative to the entire cost of implementing a digital marketing system implementation and can be a barrier to customer deployment.

As a result, we believe that the broader adoption of digital marketing technology solutions is likely to increase, although we

cannot predict the rate at which such adoption will occur.

key component of our business strategy, given the evolving dynamics of the industry in which we operate, is to acquire and integrate

other operating companies in the industry in conjunction with pursuing our organic growth objectives.

We believe that the selective

acquisition and successful integration of certain companies will:

consulting services, experience design, content development and production, software development, engineering,

implementation, and field services;

software subscription license fees;

and maintenance and support services related to our software,

managed systems and solutions.

We currently market and sell our technology

and solutions primarily through our sales and business development personnel, but we also utilize agents, strategic partners, and

lead generators who provide us with access to additional sales, business development and licensing opportunities.

Our digital marketing technology solutions

have application in a wide variety of industries.

The industries in which we sell our solutions are established and include

automotive, apparel & accessories, banking, baby/children, beauty, CPG, department stores, digital out-of-home (“DOOH”),

electronics, fashion, fitness, foodservice/quick service restaurant (“QSR”), financial services, gaming, luxury, mass

merchants, mobile operators, and pharmacy retail;

however, the planning, development, implementation and maintenance of technology-enabled

experiences involving combinations of digital marketing technologies is relatively new and evolving.

Moreover, a number of

participants in these industries have only recently started considering or expanding the adoption of these types of technologies,

solutions and experiences as part of their overall marketing strategies.

As a result, we remain without an established history

of profitability.

We believe that the adoption and evolution

of digital marketing technology solutions will increase substantially in years to come in the industries in which we currently

focus and in others;

however, adoption has not yet accelerated to the extent we expected, in part due to delays in capital expenditures

from our current and potential customer base as a result of the COVID-19 pandemic.

We also believe that adoption of our solutions

depends not only upon the services and solutions that we provide but also upon the cost of hardware used to process and display

While the costs of hardware configurations and software media players have historically decreased and we believe they

will continue to do so at an accelerating rate, flat panel displays and players typically constitute a large portion of the expenditure

customers make relative to the entire cost of implementing a digital marketing system implementation and can be a barrier to customer

As a result, we believe that the broader adoption of digital marketing technology solutions is likely to increase,

although we cannot predict the rate at which such adoption will occur.

Another key component of our business strategy,

given the evolving dynamics of the industry in which we operate, is to acquire and integrate other operating companies in the industry

in conjunction with pursuing our organic growth objectives.

We believe that the selective acquisition and successful integration

of certain companies will:

accelerate our growth in targeted vertical and operating markets;

enable us to cost-effectively aggregate multiple customer bases onto a single business and technology platform;

provide us with

greater operating scale on a consolidated basis;

enable us to leverage a common set of processes and tools, and cost efficiencies

company-wide;

and ultimately result in higher operating profitability and cash flow from operations.

Our management team evaluates

acquisition opportunities on an ongoing basis.

Our management team and Board of Directors have broad experience with the execution,

integration and financing of acquisitions.

We believe that, based on the foregoing, we can successfully serve as a consolidator

of multiple business and technology platforms serving similar markets.

may read and copy any materials we file with the SEC at the SEC’s public reference room at 100 F Street NE, Washington,

The public may obtain information about the operation of the public reference room by calling the SEC at 1-800-SEC-0330.

The SEC also maintains an Internet site that contains reports, proxy and information statements, and other information regarding

issuers that file electronically with the SEC.

enable us to cost-effectively aggregate

multiple customer bases onto a single business and technology platform;

provide us with greater operating scale on a consolidated

enable us to leverage a common set of processes and tools, and cost efficiencies company-wide;

and ultimately result in

higher operating profitability and cash flow from operations.

Our management team evaluates acquisition opportunities on an ongoing

Our management team and Board of Directors have broad experience with the execution, integration, and financing of acquisitions.

We believe that the COVID-19 pandemic has adversely affected our smaller competitors, and as a result, there may exist acquisition

opportunities in the future.We also believe that, based on the foregoing, we can successfully serve as a consolidator of multiple

business and technology platforms serving similar markets.

In addition to our historical product offerings

and solutions, in April 2020, we announced the joint launch of an AI-integrated non-contact temperature inspection kiosk known

as the “Thermal Mirror”

with our partner, InReality, LLC for use by businesses as COVID-19 related workplace restrictions

are reduced or eliminated.

The Thermal Mirror involves the development, marketing and sale of a new product to new customers involving

a joint effort with InReality compared to our historical products and services.

The product also uses hardware and technologies

that have not been used with our other customers.

Throughout 2020, the Company and InReality continued to develop incremental use

cases and subsequently launched a suite of Safe Space Solutions products addressing this market, each of which operate consistently

with our primary business model in that they represent a sale of hardware and a SaaS-based subscription license services contract.

You may read and copy any materials we file

with the SEC at the SEC’s public reference room at 100 F Street NE, Washington, DC 20549.

The public may obtain information

about the operation of the public reference room by calling the SEC at 1-800-SEC-0330.

The SEC also maintains an Internet site

that contains reports, proxy and information statements, and other information regarding issuers that file electronically with

The website of the SEC is www.sec.gov .

Additional information about

the Company and its public disclosures is available on our website at www.cri.com.

principal offices are located at 13100 Magisterial Drive, Ste 100, Louisville, Kentucky 40223, and our telephone number at that

office is (502) 791-8800.

We originally incorporated and organized as a Minnesota corporation

under the name Wireless Ronin Technologies, Inc.

Additional information about the Company and its public disclosures

is available on our website at www.cri.com.

Corporate Organization

Our principal offices are located at 13100

Magisterial Drive, Ste 100, Louisville, Kentucky 40223, and our telephone number at that office is (502) 791-8800.

We originally incorporated and organized

as a Minnesota corporation under the name “Wireless Ronin Technologies, Inc.”

in March 2003.

Our business initially focused on the provision of expertise in

digital media marketing solutions to customers, including digital signage, interactive kiosks, mobile, social media and web-based

media solutions.

We acquired the assets and business of Broadcast International, Inc., a Utah corporation and public registrant,

through a merger transaction that was effective as of August 1, 2014.

Then on August 20, 2014, we consummated a merger transaction

with Creative Realities, LLC, a privately owned Delaware limited liability company, in which we issued a majority of our issued

and outstanding shares of common stock.

In that merger transaction, we acquired the interactive marketing technology business of

Creative Realities that we currently operate.

Shortly after that merger, we changed our corporate name from Wireless Ronin Technologies,

Our business initially

focused on the provision of expertise in digital media marketing solutions to customers, including digital signage, interactive

kiosks, mobile, social media and web-based media solutions.

We acquired the assets and business of Broadcast International, Inc.,

a Utah corporation and public registrant, through a merger transaction that was effective as of August 1, 2014.

Then on August

20, 2014, we consummated a merger transaction with Creative Realities, LLC, a privately owned Delaware limited liability company,

in which we issued a majority of our issued and outstanding shares of common stock.

In that merger transaction, we acquired the

interactive marketing technology business of Creative Realities that we currently operate.

Shortly after that merger, we changed

our corporate name from “Wireless Ronin Technologies, Inc.”

to “Creative Realities, Inc.”

On October 15, 2015, we acquired the assets and business of ConeXus World Global,

LLC, a privately-owned Kentucky limited liability company for which we issued preferred and common stock.

In that merger transaction,

we acquired the systems integration and marketing technology business of ConeXus World that we currently operate.

On May 23, 2016,

we dissolved Broadcast International, Inc.

On November 20, 2018, we acquired Allure Global Solutions, Inc.

(“Allure”),

an enterprise software development company (as further described below).

corporate structure, including our principal operating subsidiaries, is as follows:

fiscal year ends December 31.

Neither we nor any of our predecessors have been in bankruptcy, receivership or any similar proceeding.

believe that our existing business model is highly scalable and can be expanded successfully as we continue to grow organically

and integrate our recent merger transactions, acquire and integrate other companies which operate directly in our target markets,

strengthen our operational practices and procedures, further streamline our administrative office functions, and continue to capitalize

on various marketing programs and activities.

approximately the past 18-36 months, we believe certain digital marketing technology industry trends are creating the opportunity

for retailers, brands, venue-operators, enterprises, non-profits and other organizations to create innovative shopping, marketing,

and informational experiences for their customers and other stakeholders in various venues worldwide.

On October 15,

2015, we acquired the assets and business of ConeXus World Global, LLC, a privately-owned Kentucky limited liability company for

which we issued preferred and common stock.

In that merger transaction, we acquired the systems integration and marketing technology

business of ConeXus World that we currently operate.

On May 23, 2016, we dissolved Broadcast International, Inc.

On November 20,

2018, we acquired Allure Global Solutions, Inc.

(“Allure”), an enterprise software development company (as further

described below).

Business Strategy

We believe that our existing business model

is highly scalable and can be expanded successfully as we continue to grow organically and integrate our recent merger transactions,

acquire and integrate other companies which operate directly in our target markets, strengthen our operational practices and procedures,

further streamline our administrative office functions, and continue to capitalize on various marketing programs and activities.

Industry Background

We believe certain digital marketing technology

industry trends are creating the opportunity for retailers, brands, venue-operators, enterprises, non-profits and other organizations

to create innovative shopping, marketing, and informational experiences for their customers and other stakeholders in various venues

These trends include:

the expectations of technology-savvy consumers;

(ii) addressing on-line competitors by improving physical experiences;

(iii) accelerating

decline in the cost of hardware configurations (primarily flat panel displays) and software media players;

(iv) the continued

evolution of mobile, social, software and hardware technologies, applications and tools;

(v) increasing sophistication of social

networking platforms;

(vi) increasingly complex customer requirements related to their specific digital marketing technology and

solution objectives;

and (vii) customers challenging service providers with the delivery of a satisfactory consumer experience

with the traditional pressure on reducing installation and ongoing operating costs.

a result, a growing number of retailers, brands, venue-operators and other organizations have identified the need and opportunity

to implement increasingly cost-effective and “sales-lifting”

digital marketing, and interactive experiences to market

to their customers.

These experiences include creating unique and customized experiences for targeted, timely offerings and relevant

improving engagement resulting in increased sales;

(i) the expectations of technology-savvy consumers;

(ii) addressing on-line competitors by improving

physical experiences;

(iii) accelerating decline in the cost of hardware configurations (primarily flat panel displays) and software

media players;

(iv) the continued evolution of mobile, social, software and hardware technologies, applications and tools;

increasing sophistication of social networking platforms;

(vi) increasingly complex customer requirements related to their specific

digital marketing technology and solution objectives;

and (vii) customers challenging service providers with the delivery of a

satisfactory consumer experience with the traditional pressure on reducing installation and ongoing operating costs.

As a result, a growing number of retailers,

brands, venue-operators and other organizations have identified the need and opportunity to implement increasingly cost-effective

and “sales-lifting”

digital marketing, and interactive experiences to market to their customers.

These experiences

include creating unique and customized experiences for targeted, timely offerings and relevant promotions;

improving engagement

resulting in increased sales;

and increasing shopping basket size.

We believe our clients consider

capitalizing on these industry trends to be increasingly critical to any successful “store of the future”

brand sales environment, especially where sales staff turnover is high, training outcomes are inconsistent and product knowledge

are accomplishing their strategies by implementing various digital marketing technology solutions, which:

are implemented in multiple

forms and types of configurations and locations;

We believe our clients consider capitalizing on these industry

trends to be increasingly critical to any successful “store of the future”

retail and brand sales environment, especially

where sales staff turnover is high, training outcomes are inconsistent and product knowledge is low.

Companies are accomplishing their strategies

by implementing various digital marketing technology solutions, which:

are implemented in multiple forms and types of configurations

and locations;

attempt to achieve any of a broad range of individual or combination of objectives;

contain various levels of targeting;

have the ability to instantly manage single or multiple locations remotely from a customer’s

desktop or other connected device at each location;

and are built to deliver or contain a standard or customized experience unique

to and within the customer’s environment.

have the ability to instantly manage single or multiple locations remotely from a customer’s desktop or other connected device

at each location;

and are built to deliver or contain a standard or customized experience unique to and within the customer’s

Examples of such solutions include:

Merchandising Systems, which aim to inform and interact with customers through various types of content in an integrated experience,

improve in-store customer experiences and increase overall sales, upsells, and/or cross-sales;

Sales Assistants, which aim to replace or augment existing sales resources and the level of interactive and informational

sales assistance inside the store;

Way-Finders, which aim to help customers navigate their way around individual retail stores and multi-store locations or venues,

or within individual brand categories;

Kiosks, which aim to provide data, specialized and customized broadcasts, promotional

information and coupons, train, and other forms of information and interaction with customers

Digital Merchandising Systems, which aim to inform and interact with customers through various types of content in an integrated experience, improve in-store customer experiences and increase overall sales, upsells, and/or cross-sales;

Digital Sales Assistants, which aim to replace or augment existing sales resources and the level of interactive and informational sales assistance inside the store;

Digital Way-Finders, which aim to help customers navigate their way around individual retail stores and multi-store locations or venues, or within individual brand categories;

Digital Kiosks, which aim to provide data, specialized

and customized broadcasts, promotional information and coupons, train, and other forms of information and interaction with customers

in a variety of deployment forms, types, configurations and experiences;

Menu-Board Systems, which aim to enable various types of restaurant operators the ability to remotely and on a scheduled basis,

update and modify menu information, promotions, and other forms of content dynamically;

Digital Signage which aims to deliver and manage in-store marketing and advertising campaigns, specialized and customized

broadcasts, and various other forms of messaging targeting customers in a particular experience or environment.

currently market and sell our marketing technology solutions through our direct sales force, inside sales team, and word-of-mouth

referrals from existing customers.

Select strategic partnerships and lead generation programs also drive business to the Company

through targeted business development initiatives.

We market to companies that seek digital marketing solutions across multiple

connected devices and who specifically seek or could benefit from enhancements to the customer experience offered in their stores,

venues, brands or organizations.

digital marketing technology solutions have application in a wide variety of industries.

The industries in which we sell

our solutions are established and include automotive, apparel & accessories, banking, baby/children, beauty, CPG, department

stores, digital out-of-home (“DOOH”), electronics, fashion, fitness, foodservice/quick service restaurant (“QSR”),

financial services, gaming, luxury, mass merchants, mobile operators, and pharmacy retail;

however, the planning, development,

implementation and maintenance of technology-enabled experiences involving combinations of digital marketing technologies is relatively

new and evolving.

Moreover, a number of participants in these industries have only recently started considering or expanding

the adoption of these types of technologies, solutions and experiences as part of their overall marketing strategies.

portion of our customer activity is influenced by seasonal effects related to traditional end of calendar year peak retail sales

periods and certain other factors that arise from our target customer base.

Digital Menu-Board Systems, which aim to enable various types of restaurant operators the ability to remotely and on a scheduled basis, update and modify menu information, promotions, and other forms of content dynamically;

Dynamic Digital Signage which aims to deliver and manage in-store marketing and advertising campaigns, specialized and customized broadcasts, and various other forms of messaging targeting customers in a particular experience or environment.

We currently market and sell our marketing

technology solutions through our direct sales force, inside sales team, and word-of-mouth referrals from existing customers.

strategic partnerships and lead generation programs also drive business to the Company through targeted business development initiatives.

We market to companies that seek digital marketing solutions across multiple connected devices and who specifically seek or could

benefit from enhancements to the customer experience offered in their stores, venues, brands or organizations.

In addition to our

direct sales force, we market our Safe Space Solutions suite of products through a network of distribution and reseller partners

through which we have expanded our market presence and reach.

Distributors operate on either a consignment or direct drop ship

approach and no revenue is recognized until a sale is made and product is delivered.

Our digital marketing technology solutions

have application in a wide variety of industries.

The industries in which we sell our solutions are established and include

automotive, apparel & accessories, banking, baby/children, beauty, CPG, department stores, digital out-of-home (“DOOH”),

electronics, fashion, fitness, foodservice/quick service restaurant (“QSR”), financial services, gaming, luxury, mass

merchants, mobile operators, and pharmacy retail;

however, the planning, development, implementation and maintenance of technology-enabled

experiences involving combinations of digital marketing technologies is relatively new and evolving.

Moreover, a number of

participants in these industries have only recently started considering or expanding the adoption of these types of technologies,

solutions and experiences as part of their overall marketing strategies.

A portion of our customer activity is influenced

by seasonal effects related to traditional end of calendar year peak retail sales periods, traditional spring stadium/venue opening

seasons, and certain other factors that arise from our target customer base.

Nevertheless, our revenues can be materially affected

1 unchanged sentence

outweigh certain seasonal effects.

of General Economic Conditions on our Business

believe that demand for our services will increase in part as a result of new construction and remodeling activities of pre-existing

retail, convenience store, stadium and event venues.

While we do see reductions in retail footprints across the U.S., we see a

continued focus on integration of digital into the retail marketplace and a focus on digital refreshes within the retail space

to stay relevant in an evolving e-commerce marketplace.

Recent general economic improvements generally make it easier for our

customers to justify decisions to invest in digital marketing technology solutions.

A change in the macroeconomic trend in the

Effect of General Economic Conditions

on our Business

We believe that demand for our services

will increase in part because of new construction and remodeling activities of pre-existing retail, convenience store, stadium

and event venues.

While we do see reductions in retail footprints across the U.S., we see a continued focus on integration of digital

into the retail marketplace and a focus on digital refreshes within the retail space to stay relevant in an evolving e-commerce

Recent general economic improvements generally make it easier for our customers to justify decisions to invest in

digital marketing technology solutions.

A change in the macroeconomic trend in the U.S.

could have a negative impact on our customers’

ability and/or willingness to advance their digital initiatives.

are subject to regulation by various federal and state governmental agencies.

Such regulation includes radio frequency emission

regulatory activities of the U.S.

Federal Communications Commission, the consumer protection laws of the U.S.

Federal Trade Commission,

product safety regulatory activities of the U.S.

Consumer Product Safety Commission, and environmental regulation in areas in

which we conduct business.

Some of the hardware components that we supply to customers may contain hazardous or regulated substances,

such as lead.

We are subject to regulation by various

federal and state governmental agencies.

Such regulation includes radio frequency emission regulatory activities of the U.S.

Communications Commission, the consumer protection laws of the U.S.

Federal Trade Commission, product safety regulatory activities

Consumer Product Safety Commission, and environmental regulation in areas in which we conduct business.

hardware components that we supply to customers may contain hazardous or regulated substances, such as lead.

A number of U.S.

states have adopted or are considering “takeback”

bills addressing the disposal of

electronic waste, including CRT style and flat panel monitors and computers.

have adopted or are considering “takeback”

bills addressing the disposal of electronic waste, including CRT style and

flat panel monitors and computers.

Electronic waste legislation is developing.

of the bills passed or under consideration may impose on us, or on our customers or suppliers, requirements for disposal of systems

we sell and the payment of additional fees to pay costs of disposal and recycling.

Presently, we do not believe that any such

legislation or proposed legislation will have a materially adverse impact on our business.

we believe there is presently no direct competitor with the comprehensive offering of technologies, solutions and services we

provide to our customers, there are multiple individual competitors who offer pieces of our solutions.

These include digital signage

software companies such as Stratacache, Four Winds Interactive, and Reflect Systems;

marketing services companies such as Sapient

Nitro or digital signage systems integrators such as Convergent Media Systems.

Some of these competitors may have significantly

greater financial, technical and marketing resources than we do and may be able to respond more rapidly than we can to new or

emerging technologies or changes in customer requirements.

We believe that our sales and business development capabilities, network

operations / field service management capabilities, our comprehensive offering of digital marketing technology and solutions,

brand awareness, and proprietary processes are the primary factors affecting our competitive position.

had one (1) and two (2) customers that accounted for 18.5% and 48.3% of revenue for the years ended December 31, 2019 and 2018,

respectively.

by one or more of these key customers to not renew, terminate or substantially reduce their use of our products, technology, services,

and platform could substantially slow our revenue growth and lead to a decline in revenue.

Our business plan assumes continued

growth in revenue, and it is unlikely that we will become profitable without a continued increase in revenue.

the years ended December 31, 2019 and 2018, we had sales of $1,103 (3.5% of consolidated sales) and $1,566 (6.9% of consolidated

sales), respectively, with 33 Degrees Convenience Connect, Inc., a related party that is approximately 17.5% owned by a member

of our senior management (“33 Degrees”).

sell products and services primarily throughout North America.

We have approximately 100 employees as of March 12, 2020.

do not have any employees that operate under collective-bargaining agreements.

Some of the bills passed or under consideration

may impose on us, or on our customers or suppliers, requirements for disposal of systems we sell and the payment of additional

fees to pay costs of disposal and recycling.

Presently, we do not believe that any such legislation or proposed legislation will

have a materially adverse impact on our business.

Our Thermal Mirror and other Safe Space

Solutions products are utilized by employers, in part, to evaluate the temperature of their respective employees or guests to their

Consequently, regulations from the U.S.

Food and Drug Administration, as well as state regulations related to consumer

and employee privacy rights, may apply to the sale and use of such devices within the United States.

Similarly, because the devices

are sold in Canada, regulations related to consumer and employee privacy in provinces where such regulations exist may apply to

the sale and use of such devices in those provinces in Canada.

Presently, we do not believe that any such legislation or proposed

legislation will have a materially adverse impact on our business.

While we believe there is presently no direct

competitor with the comprehensive offering of technologies, solutions and services we provide to our customers, there are multiple

individual competitors who offer pieces of our solutions.

These include digital signage software companies such as Stratacache,

Four Winds Interactive, and Reflect Systems;

marketing services companies such as Sapient Nitro or digital signage systems integrators

such as SageNet.

Some of these competitors may have significantly greater financial, technical and marketing resources than we

do and may be able to respond more rapidly than we can to new or emerging technologies or changes in customer requirements.

believe that our sales and business development capabilities, network operations / field service management capabilities, our comprehensive

offering of digital marketing technology and solutions, brand awareness, and proprietary processes are the primary factors affecting

our competitive position.

Major Customers

We had two (2) and one (1) customer(s) that

accounted for 27.8% and 18.5% of revenue for the years ended December 31, 2020 and 2019, respectively.

Decisions by one or more of these key customers

to not renew, terminate or substantially reduce their use of our products, technology, services, and platform could substantially

slow our revenue growth and lead to a decline in revenue.

Our business plan assumes continued growth in revenue, and it is unlikely

that we will become profitable without a continued increase in revenue.

For the years ended December 31, 2020 and

2019, we had sales of $1,058 (6.1% of consolidated sales) and $1,103 (3.5% of consolidated sales), respectively, with 33 Degrees

Convenience Connect, Inc., a related party that is approximately 17.5% owned by a member of our senior management (“33 Degrees”).

We sell products and services primarily

throughout North America.

We have approximately 75 employees as of

March 8, 2021.

We do not have any employees that operate under collective-bargaining agreements.

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 1. Business