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Item 3. Legal Proceedings

2026-03-20 compared with 2025-03-25 · 38 added, 11 removed, 1 unchanged (98% of the section changed)

the ordinary course of business, we may become a party to lawsuits involving various matters.

The impact and outcome of litigation, if

any, is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm

our business.

We believe the ultimate resolution of any such current proceeding will not have a material adverse effect on our continued

financial position, results of operations or cash flows, except as otherwise set forth below.

However, assessment of the current litigation

or other legal claims could change in light of the discovery of facts not presently known to the Company or by judges, juries or other

finders of fact, which are not in accord with management’s evaluation of the possible liability or outcome of such litigation or

of the date of this Annual Report, we are not the subject of any legal proceedings that are expected, individually or in the aggregate,

to have a material adverse impact on our financial position or results of operations.

We are not currently involved

in any legal proceedings, except as described below.

From time to time, we may become a party to various legal actions and complaints

arising in the ordinary course of business.

In addition to commitments and obligations in the ordinary course of business, we may be subject

to various claims, pending and potential legal actions for damages, investigations relating to governmental laws and regulations and other

matters arising out of the normal conduct of our business.

It is possible that our cash flows or results of operations could be materially

affected in any particular period by the unfavorable resolution of one or more of these contingencies.

Dispute with Former Management

October 10, 2025, the Company initiated litigation in the Circuit Court of the Thirteenth Judicial Circuit in and Hillsborough County,

Florida against certain former officers and/or directors of the Company (collectively, the “Former Management Parties”).

The complaint asserts claims including, among others, breach of the fiduciary duty of loyalty, breach of contract, tortious interference

with a contract, tortious interference with business relationships, and other applicable claims, arising out of the Former Management

Parties’ efforts to threaten harm the Company as leverage to force the retraction of a vote of the majority shareholders.

December 10, 2025, Defendants filed a motion to compel arbitration of all claims in the suit.

The Company does not agree that all the

claims in the suit are subject to mandatory arbitration, and filed an opposition to that motion on December 22, 2025.

A hearing is currently

scheduled on the motion to compel arbitration for April 27, 2026.

the Company believes it has meritorious claims, litigation is inherently uncertain, and there can be no assurance regarding the outcome

or timing of resolution.

January 2026, the Company has also served a notice of claims against the Former Management Parties for misrepresentations and omissions

of material fact in connection with an acquisition of certain limited liability company membership interests, which that resulted in,

among other things, supposed promises of equity and related arrangements to such individuals.

The Company intends to seek, among other

relief, rescission and cancellation of any purported commitments related to or resulting from the misrepresentations and omissions, as

well as related equitable and monetary remedies.

of December 31, 2025, obligations associated with these arrangements are reflected as liabilities on the Company’s consolidated

balance sheet in the aggregate amount of approximately $17,500,000.

the potential resolution of this matter may result in a gain contingency, no amounts have been recognized in the accompanying consolidated

financial statements for any potential recovery or reduction of the recorded liability.

If the Company prevails in the litigation, all

or a portion of the recorded liability may be reversed in a future period.

The Company will continue to evaluate this matter and will

adjust the related liability, if appropriate, based on developments in the litigation.

See Note 13 to the consolidated financial statements

for additional information regarding this matter.

SAFETY DISCLOSURES

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 3. Legal Proceedings