What changed in this filing

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Item 1. Legal Proceedings

2026-07-29 compared with 2026-04-29 · 104 added, 111 removed, 530 unchanged (29% of the section changed)

11 unchanged sentences

• Endpoint ICs:

NXP, Kiloway, Quanray, Shanghai Fudan Microelectronics Group, Alibaba and Alien.

NXP, Kiloway, Quanray, Shanghai Fudan Microelectronics Group and Alien.

• Reader ICs:

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Most major reader and gateway suppliers leverage, or have a stated intent to leverage, our platform.

• Tag production systems:

• Label production systems:

These competitors include companies that have much greater financial, operating, research and development, marketing and other resources than us.

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Continued RAIN adoption by those end users and in those markets may be at risk if and when negative business, geopolitical or economic conditions arise.

The RAIN opportunity is still developing.

RAIN adoption, as well as adoption of our platform and products, including our Gen2X features, depends on many factors, including the extent to which end users understand and embrace the benefits that RAIN and our platforms and products offer;

Going forward, RAIN adoption, including adoption of our platform, products and innovations like Gen2X, will depend on many factors, such as the extent to which end users understand and embrace the benefits that RAIN and our platforms, products and features offer;

whether their benefits outweigh the cost and time to replace or modify end users’ existing systems and processes;

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As a result, we may be unable to accurately forecast our future operating results including revenue, gross margins, cash flows and profitability, any or all of which could negatively impact our financial performance.

We must introduce new products, services and solutions to compete effectively.

We introduce new products and services to advance our business, satisfy increasingly demanding end-user requirements and grow RAIN market adoption.

We commit significant resources developing and introducing these new products and services, and to improving the performance and reliability of, and reducing the costs of, our existing products and services.

We are also increasingly focused on providing enterprise solutions to partners and end users.

Whether our new or enhanced products, services and solutions will succeed is uncertain.

We must continue to introduce new products, services and solutions to foster growth and RAIN adoption.

We strive to regularly introduce new products and services to advance our business, satisfy increasingly demanding end-user requirements and grow the RAIN market by committing significant resources developing and introducing new or enhanced products, services and solutions.

Whether our new or enhanced products, services and solutions will succeed in continuing to grow RAIN adoption is uncertain.

For example, our software and cloud services offerings have not yet grown into a material source of revenue, and whether or when our investment in these areas will be successful is uncertain.

Our success developing the technologies, processes or capabilities necessary or desired for new or enhanced products, services and solutions, or licensing or otherwise acquiring them from third parties, and our ability to introduce new or enhanced products, services and solutions before our competition, depends on many factors, including:

• our ability to identify new product capabilities, services or solutions that end users will widely adopt;

Our success in developing the technologies, processes or capabilities necessary or desired for new or enhanced products, services and solutions, or licensing or otherwise acquiring them from third parties, and our ability to introduce new or enhanced products, services and solutions before our competition, depends on many factors, including:

• our ability to identify new use cases for our products, services and solutions that end users will widely and readily adopt;

• timely and efficiently completing the design process;

• timely and efficiently implementing manufacturing, assembly and testing procedures;

• timely and efficiently implementing production and testing procedures;

• attaining appropriate performance levels and certifications;

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• marketing, sales and support effectiveness.

When we introduce new products, services and solutions, our success in ramping adoption depends, in part, on us making those products, services and solutions easy for our partners and end users to deploy and use.

When we introduce new or enhanced products, services and solutions, our success in ramping adoption depends, in part, on us making those products, services and solutions easy for our partners and end users to deploy and use.

For example, when we launched our M800-family endpoint ICs, we supported our inlay partners in producing high-performing, high-quality M800-based inlays.

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If we do not succeed in identifying, developing, selling, deploying and maintaining enterprise solutions with top-tier partners and key end users across various markets and use cases, then our business prospects will suffer.

We have developed, and continue developing, solutions for retail self-checkout and loss prevention and SC&L package routing that have been, or that we expect to be, deployed by industry-leading enterprise end users.

We have developed, and continue developing, solutions for retail point of sale and loss prevention and SC&L package routing that have been, or that we expect to be, deployed by industry-leading enterprise end users.

We have also launched features in Gen2X that we believe will improve our ability to deliver cost-effective enterprise solutions.

If we do not make our offerings repeatable across multiple enterprises and in various market segments, we may fail to capitalize on our platform’s potential.

We may not gain access to and address challenging new use cases, such as health and beauty, cosmetics, pharmaceuticals and food if we do not succeed in developing relationships with top-tier solution partners who know about and believe in our solutions.

We and our partners may be unable to successfully acquire customers for our enterprise solutions, or to successfully address our market opportunity.

We may not have the opportunity to address challenging new use cases across new market segments, such as, health and beauty, cosmetics, pharmaceuticals and food, if we do not succeed in developing relationships with top-tier solution partners who know about and believe in our solutions.

We and our partners may be unable to successfully address our market opportunity for enterprise solutions.

Delivering enterprise solutions requires a partner products and services network that complements our own and that together addresses enterprise needs.

Convincing enterprises to partner with us to solve their business problems—including evaluation, design, deployment, operations and services, as well as integrating RAIN data into the enterprise’s information systems—requires tight coordination among our and our partners’ sales, marketing, operations and engineering teams.

If we do not build our enterprise solutions platform and our partner network to deliver these solutions effectively, our business prospects will suffer.

Convincing enterprises to partner with us to solve their business problems—including evaluation, design, deployment, operations and services, as well as integrating data from our platform into the enterprise’s information systems—requires tight coordination among our and our partners’ sales, marketing, operations and engineering teams.

If we do not build our enterprise solutions platform and our partner network to deliver the expected benefits effectively, our business prospects will suffer.

We rely on endpoint IC sales to generate most of our revenue.

We derive, and expect to continue to derive for some time, most of our revenue from our endpoint ICs.

If demand declines, or if we are unable to procure enough wafers to meet the demand we have, or if we are unable to raise prices to offset cost increases, then our business and operating results will suffer.

If endpoint IC demand declines, if we are unable to meet the demand we have, or if we are unable to raise prices to offset cost increases, then our business and operating results will suffer.

In addition, the continued adoption of, and demand for, our endpoint ICs derives in part from us demonstrating their benefits using our platform.

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Though less common, we have also increased prices from time to time, especially during times of increasing wafer and/or post-processing costs.

For example, we raised prices in 2021, 2022 and 2023 to accommodate higher costs.

We may be required to raise prices again if macroeconomic conditions, including inflation, or other causes, such as geopolitical instability, create upward pressure on our product costs.

Recently, and significantly due to increasing worldwide semiconductor demand, many of our vendors and subcontractors have either increased prices, signaled future price increases or both.

In response, we have notified our customers of modest, impending product price increases.

We may be required to raise prices again if economic conditions, including inflation, or other causes, such as geopolitical instability, create additional upward pressure on our product costs.

Higher prices could reduce our market share and/or dampen adoption and market growth.

Pricing commitments and other restrictive provisions in our customer agreements could adversely affect our operating results.

In the ordinary course of our business, we enter into agreements containing pricing terms that could, in some instances, adversely affect our operating results and gross margins.

For example, some contracts specify future reader or gateway pricing or contain most-favored-customer pricing for certain products.

Other agreements may contain exclusivity terms that prevent us from pursuing certain business with other customers during the exclusivity period.

Reducing prices or offering favorable terms to one customer could adversely affect our ability to negotiate favorable terms with other customers.

Changes in our product mix could adversely affect our overall gross margin.

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Poor product quality could result in significant costs to us and impair our ability to sell our products.

Our products must meet increasingly demanding specifications for quality, reliability and performance.

Our products are both highly technical and deployed in large, complex systems in which errors, defects or incompatibilities can be problematic for our partners and end users.

If we are unable to identify or correct errors, defects, incompatibilities or other problems in our products, we could experience a number of negative consequences, including lost or delayed sales or market acceptance (either of our products and solutions or RAIN generally), loss of market share and damage to our brand and reputation, increased service, warranty and replacement costs and legal actions by our partners or end users.

Moreover, if we encounter product quality issues, then we may be required to incur significant time and costs to diagnose, test and fix the issues.

There can be no assurance that such remediation efforts would be successful.

Even if successful, these efforts could further constrain our ability to supply our partners and end users with new products until we have resolved the issues.

Moreover, if we encounter product quality issues, then we may incur significant time and costs to diagnose, test and fix the issues.

These efforts may not succeed and could further constrain our ability to supply our partners and end users with new products until we resolve the issues.

End users and partners must design our products into their products and business processes.

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They may use other technologies or products and may not be receptive to introducing RAIN into their business processes or products.

Even when convinced, they often undertake long pilot programs and qualifications prior to placing orders.

These pilot programs and qualifications can be time-consuming and expensive, and there is no assurance they will result in an order for our products.

If we fail to develop new products that adequately or competitively address end users’ or our partners’ needs, then we may not receive product orders, which could adversely affect our business, prospects and operating results.

Our visibility into the length of the sales and deployment cycles for our products is limited.

We have limited visibility into end-user sales and deployment cycles, and these cycles are often longer than we anticipate.

Many factors contribute to our limited visibility, including the time our partners and end users spend evaluating our products, the time educating them on RAIN’s benefits and the time integrating our products with end users’ systems.

The length and uncertain timing of the sales and deployment cycles can lead to delayed product orders.

Even when convinced, they often undertake pilot programs and qualifications prior to placing orders.

Those pilot programs and qualifications can be time-consuming and expensive and that may not result in orders for our products, which could adversely affect our business prospects and operating results.

Our visibility into the procurement and deployment cycles for our products, while improving, is still limited.

We have limited visibility into end-user procurement and deployment cycles, and these cycles often take longer than we anticipate.

Many factors contribute to our limited visibility, including but not limited to the fact that we sell most of our products through partners rather than directly to the end user.

We also have limited visibility into the time end users spend evaluating our products, services and solutions;

the time partners spend educating end users on the benefits of using our products, services and solutions;

and the time to integrate our products, services and solutions with end users’ systems.

The length and uncertain timing of the procurement and deployment cycles can delay product orders.

In anticipation of those orders, we may incur substantial costs before the sales cycle is complete and before we receive any customer orders or payments, if we receive them at all.

An inability or limited ability of end user systems to exploit RAIN information may adversely affect the market for our products.

An inability or limited ability of end user systems to exploit RAIN data may adversely affect the market for our products, services and solutions.

A successful end-user deployment requires not only tags, readers or gateways and operating software, but RAIN integration with information systems and applications that create business value from the RAIN data.

Unless end users have access to effective analytical tools that extract business value, and enable their information systems to use these tools, RAIN deployments could stall.

Our efforts to foster development and deployment of these tools could fail.

In addition, our guidance to business-analytics providers for integrating our products with their tools could prove ineffective.

Unless end users have access to effective analytical tools that extract business value, and enable their information systems to use these tools, RAIN deployments could stall, our

efforts to foster development and deployment of these tools could fail, and our guidance to business-analytics providers for integrating our products with their tools could prove ineffective.

Solution providers and SIs are essential to the RAIN market.

They provide deployment know-how to enable end users to successfully deploy RAIN solutions.

Integrating our products with end-user information systems could prove more difficult or time-consuming than we or they anticipate, which could delay deployments.

Integrating our products with end-user information systems could prove more difficult or time-consuming than we or they anticipate, which could jeopardize deployments.

Alternative technologies may enable products and services that compete with ours.

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If we are unable to innovate using new or enhanced technologies or are slow to react to changes in existing technologies or in the market, or if we have difficulty competing with advances in new or legacy technologies, then our development of new or enhanced products could be impacted and result in product obsolescence, decreased revenue and reduced market share.

Significant changes in RAIN standards bodies, standards or qualification processes, or their failure to meet or to keep up with RAIN market needs, could impede our ability to sell our products and services.

We have historically taken a leadership position in developing RAIN industry standards, including with GS1 and ISO, and have designed our products to comply with those standards.

We could lose that leadership position or our influence in standards development, or we could choose not to participate in certain standards activities.

If industry standards were to diverge from, or fail to meet or keep up with, our or the RAIN market’s needs, then our products and services could fail in the market.

End users could delay their deployments and slow sales of our existing products or services, or limit our ability to implement new features.

If industry standards were to diverge from, or fail to meet or keep up with, our or the RAIN market’s needs, then RAIN products, including ours, could fail in the market.

End users could delay their deployments and slow sales of our existing products, or limit our ability to implement new features.

The lost opportunities as well as time and expense to develop new products or change our existing products could be substantial, and we may not ultimately succeed.

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Our products operate in spectrum bands where they are certified to transmit.

If the spectrum regulations were to change, or if our products were found to be noncompliant despite being certified to operate, then we would need to redesign our products, potentially resulting in significant costs, including costs associated with obsolete inventory.

If the spectrum regulations were to change, or if our products were found to be noncompliant despite being certified to operate, or if the spectrum regulation themselves were to be found deficient, then we would need to redesign our products, potentially resulting in significant costs, including costs associated with obsolete inventory.

Regulatory changes may also cause us to forego opportunities, adversely affecting our business.

In April 2024, NextNav, Inc.

asked the Federal Communications Commission, or FCC, to initiate a proceeding to reconfigure the 902–928 MHz ISM band, or Lower 900 MHz Band, in which we and other unlicensed services operate, to create a terrestrial backup to the U.S.

Global Positioning System to provide positing, navigation and timing, or PNT, data.

Global Positioning System, or GPS, to provide positing, navigation and timing, or PNT, data.

To pay for their proposed system, NextNav also asked to be able to license certain spectral bands, including parts of the Lower 900 MHz Band, to others to deliver 5G broadband services.

We and other RAIN providers and end users, as well as other Lower 900 MHz Band users, registered opposition to NextNav’s petition and asked the FCC to reject it.

A wide range of Lower 900 MHz Band users, industry groups and companies, including us and other RAIN providers registered opposition to NextNav’s petition and asked the FCC to reject it.

In early 2025, the FCC launched a Notice of Inquiry to explore ways in which the FCC could support alternative PNT technologies and solutions.

Comments and reply comments were due in April and May 2025, respectively.

The FCC has not yet acted on NextNav’s petition or on the PNT Notice of Inquiry and the fate of NextNav’s petition is uncertain.

NextNav has actively lobbied various federal government branches and units to support its proposal but the FCC has not yet acted on NextNav’s petition or on the PNT Notice of Inquiry and the fate of NextNav’s petition remains uncertain.

If NextNav’s petition is approved as proposed, the consequent ISM band reconfiguration could negatively impact us and our industry.

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Some of our partners promote certain of our products and services while competing with our other products and services.

For example, some of our OEM partners use our reader ICs to build and sell readers and gateways that compete with our readers and gateways.

For example, some of our OEM partners use our reader ICs to build and sell readers and gateways that compete with our readers and

Similarly, some of our partners use our readers to build and sell gateways that compete with our gateways.

If we fail to manage such conflicts successfully, then our business and operating results could be negatively affected.

Our licensing program is nascent and limited.

While we believe we have valuable RAIN intellectual property and aspire to monetize that intellectual property by licensing it to third parties, including third parties who compete with us to some extent, our experience in doing so is nascent, and our ability to grow licensing revenue remains subject to numerous risks and uncertainties.

These risks and uncertainties include our ability to maintain and grow our intellectual property portfolio and to research and develop RAIN innovations that will generate and maintain demand for licenses to our technology and features, and our ability to monitor infringement of our intellectual property rights by others and possibly seek enforcement action against those who attempt to infringe our intellectual property rights.

Our licensing program is also not singly focused on generating licensing revenue.

Our efforts to license our intellectual property are limited.

Our ability to grow licensing revenue remains subject to numerous risks and uncertainties.

These risks and uncertainties include our ability to maintain and grow our intellectual property portfolio and to research and develop RAIN innovations that will generate and maintain demand for licenses to our technology and features, our ability to monitor infringement of our intellectual property rights by others and possibly seek enforcement action against those who attempt to infringe our intellectual property rights, and the fact that our experience in licensing our intellectual property is limited.

Our licensing efforts are also not singly focused on generating licensing revenue.

Our desire to maintain close, strategic relationships with important partners or end users and to encourage them to use innovations such as Gen2X may cause us to license our intellectual property for reasons that go beyond simply deriving licensing revenue.

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Our wafer supply is not guaranteed, and we may not receive adequate supply from our foundry partners when industry demand for wafers is high, as it frequently is in the process nodes we use.

Our IC supply can also be limited by post-processing constraints, such as in testing, thinning, bumping, dicing and packaging.

Our IC supply can also be limited by post-processing constraints, such as in testing, sorting, thinning, bumping, dicing, packaging and quality assurance.

We may also experience shortfalls and price increases for components we use in our readers and gateways.

Wafer shortfalls can also artificially increase bookings as customers over-order our products and then cause sales declines as those customers consume their accumulated inventory.

Wafer shortfalls can also artificially increase bookings as customers over-order our products and then cause subsequent sales declines as those customers consume their accumulated inventory.

Additionally, if our suppliers charge us more but we are unable to raise our prices to cover those higher costs, our gross margins and other financial results could suffer.

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When we introduce new products, we may initially carry higher inventory or allow for slower inventory turns.

We typically order products from our suppliers based on sales forecasts before we receive purchase orders.

We typically order products from our suppliers based on sales forecasts and before we receive purchase orders.

Many of our partners have difficulty accurately forecasting the amount and timing of their sales, and sometimes cancel orders or reschedule product shipments with little or no advance notice to us.

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Competition and unanticipated external events, such as macroeconomic or regulatory changes, can also adversely affect demand and consequently our inventory levels, sales and operating results.

High inventory levels can increase expenses and expose us to a higher risk of product obsolescence especially when we introduce new products and technologies.

If we are unable to sell our inventory as and when we expect to, we may have to discount or expense the excess inventory and our business and financial results will be negatively impacted as a result.

High inventory levels can increase expenses and expose us to a heightened risk of product obsolescence, especially when we introduce new products and technologies.

If we are unable to sell our inventory as and when we expect to, we may have to discount or expense the excess inventory, negatively impacting our business and financial results.

We must attract and retain employees with specialized knowledge and experience to compete effectively.

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We must also adapt to changes in our executive team from time to time.

Our business could be significantly harmed if we were not able to attract and retain key talent, or if we were not able to effectively manage transitions in personnel and leadership as they arise.

Our business could be significantly harmed if we are unable to attract and retain key talent, or if we are unable to effectively manage transitions in personnel and leadership as they arise.

Acquisitions could result in operating difficulties, dilution and other harmful consequences.

We regularly evaluate potential strategic transactions, and we may pursue them if complementary to our business.

For example, in April 2023 we acquired Voyantic Oy, a global provider of RFID (primarily RAIN and NFC) inlay and label design, manufacturing and test systems.

Strategic transactions could be material to our financial condition and operating results.

We regularly evaluate potential strategic transactions, and we may pursue them if complementary or beneficial to our business.

For example, in April 2023 we acquired Voyantic Oy, a global provider of RFID (primarily RAIN and NFC) label production systems.

Future strategic transactions, if any, could be material to our financial condition and operating results.

We have limited experience executing acquisitions.

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Also, the anticipated benefit of any acquisition, domestic or foreign, may not materialize.

Future acquisitions or dispositions could result in potentially dilutive issuances of our equity securities, debt incurrence, contingent liabilities or amortization expenses or goodwill write-offs, any of which could harm our financial condition.

Future acquisitions or dispositions could result in potentially dilutive issuances of our equity securities, increased debt, contingent liabilities or amortization expenses or goodwill write-offs, any of which could harm our financial condition.

Future acquisitions may require us to obtain additional equity or debt financing, which may not be available on favorable terms or at all.

Changes in global trade policies could have a material adverse effect on us.

The state of tariffs and other trade measures worldwide remains very uncertain.

Trade policies, tariffs and other trade measures worldwide are, and are likely to remain, very uncertain.

Trade is a focus of the current U.S.

administration, and the administration has been very active in this area.

A full understanding of the amount, scope, and nature of any tariffs and other trade restrictions that the U.S.

administration, as are tariffs, and U.S.

policies have shifted rapidly as a result.

A full understanding of the amount, scope, and nature of any tariffs and other trade measures that the U.S.

may implement as well as how other countries may respond is unclear.

In February 2026, the U.S.

Supreme Court invalidated the use of the International Emergency Economic Powers Act to impose significant tariffs the administration announced and implemented beginning in 2025.

Following that decision, the administration replaced those tariffs with a 10% import surcharge on nearly all U.S.

imports under a different legal authority, which is set to expire in July 2026 unless Congress extends it.

Supreme Court determined that the International Emergency Economic Powers Act, or IEEPA, did not authorize the tariffs the U.S.

administration had implemented in 2025.

Following that decision, the administration rescinded the tariffs imposed under IEEPA effective February 24, 2026, and in its place imposed a surcharge on U.S.

imports under Section 122 of the Trade Act of 1974.

The Section 122 surcharge expired effective July 24, 2026, after which the U.S.

administration imposed tariffs of 10% or 12.5% on the largest U.S.

trading partners under authorities provided in Section 301 of the Trade Act of 1974, following determinations that those U.S.

trading partners insufficiently enforce forced labor laws.

Under separate authority, the U.S.

also imposed tariffs on imports of steel, aluminum and copper;

on certain semiconductor products including still-higher tariffs on Chinese-origin semiconductors;

and on certain additional items.

on certain semiconductor products including higher tariffs on Chinese-origin semiconductors;

and on certain additional items under Section 232 of the Trade Expansion Act of 1962.

Based on trade actions undertaken and/or threatened by the U.S.

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tariffs on our endpoint IC business is likely to be manageable because we import only a small portion of our wafers into the United States.

However, the indirect effects of U.S.

However, the indirect impact of U.S.

tariffs on products containing our endpoint ICs could be significant.

China remains a key producer of the goods our endpoint ICs connect, and a key producer of readers using our reader ICs, so the imposition of high U.S.

China remains a key producer of the goods our endpoint ICs connect, and a key producer of readers using our reader ICs, so high U.S.

tariffs on imports from China could significantly and negatively affect our business and financial results.

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For example, the U.S.

government has continued to expand controls restricting the ability to send certain products and technology related to semiconductors and semiconductor manufacturing to and within China and additional destinations.

These expanded controls include imposing additional licensing requirements on exports, re-exports and transfers of certain ICs and products containing those ICs to and within China and additional destinations.

In addition, the United States and other countries continue to expand the economic sanctions and export control restrictions imposed against Russia and Belarus and certain Russian nationals and entities after Russia invaded Ukraine.

government has continued restricting the ability to export, re-export and transfer (in country) certain products and technology related to semiconductors and semiconductor manufacturing and certain ICs and products containing those ICs to and within China and additional destinations.

In addition, the United States and other countries continue to expand the economic sanctions and export control restrictions in response to global conflicts including in Russia and Ukraine and in the Middle East.

We must undertake additional diligence efforts to comply with these and other rules, which may be time-consuming and result in delayed or lost opportunities.

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Using emerging technologies such as artificial intelligence, or AI, and machine learning, or ML, could expose us to business, financial, legal or reputational risks.

Rapid advancements in AI and ML offer great potential for improving our solutions performance, operating efficiency and engineering development, but employing them can also increase our business, financial, legal and other risks.

Rapid advancements in AI and ML offer great potential for improving our solutions performance, operating efficiency and engineering development, but using them can also increase our business, financial, legal and other risks.

As we introduce more AI and ML tools into our products and operations, we must guard against risks in using them.

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If we are unable to replace project-based revenue with new revenue streams, or if end users with large projects change or delay those projects without providing us with adequate notice, then our sales could decline from period to period and negatively affect our stock price.

Our ability to affect or determine end-user demand is limited in part because we sell and fulfill primarily through partners and rarely directly to end users.

End users drive demand for our products but because we sell our products primarily through partners, we are one step removed from those end users and are often unable to directly assess and affect their demand.

Our ability to affect or determine end-user demand is limited in part because we sell mostly through partners and rarely directly to end users.

End users drive demand for our products but because we sell our products primarily through partners, we are often at least one step removed from those end users and are often unable to directly assess and affect their demand.

Our partners may choose to prioritize selling our competitors’ products over ours, or they may offer products that compete with our products or limit sales of our products.

If our partners do not sell enough of our products or if they choose to decrease their inventories of our products, then our sales to those partners and our revenue will decline.

Our partners may not properly forecast end users’ demand for our products.

Our reserve estimates for products stocked by our distributors are based primarily on reports provided to us by those distributors, typically monthly.

If the inventory and resale information our partners and distributors provide is inaccurate, or if we do not receive it in a timely manner, then we may not have a reliable view of products we expect to be sold to end users which could ultimately have a negative impact on our operating results.

If our partners overestimate demand, they may overinvest in production capacity, which could reduce market prices and negatively affect our selling prices.

In the short term, our partners might purchase more of our products than they need, increasing their inventory and reducing our future sales to them, and distributors may, subject to time and quality limitations, seek to return products in exchange for other products.

If our partners underestimate demand, we may not be able to satisfy their needs and that of their customers, and adoption might suffer.

Our distributors may not properly forecast end users’ demand for our products.

Our reserve estimates for products stocked by our distributors are based primarily on reports those distributors provide to us, typically monthly.

If the inventory and resale information they provide is inaccurate, or if we do not receive it in a timely manner, then we may not have a reliable view of their stock and market demand, which could have a negative impact on our operating results.

If they overestimate demand, they may overinvest in stock, which could reduce market prices and negatively affect our selling prices.

They may also try, subject to time and quality limitations, to return products or exchange products.

If they underestimate demand, we may not be able to satisfy their needs and that of their customers, and adoption might suffer.

In either case, our business and operating results could be negatively affected.

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Risks Relating to Our Intellectual Property

If we are unable to protect and enforce our intellectual property, then our business could be adversely affected.

Our ability to protect and enforce our intellectual property.

Our success depends in part upon our ability to obtain, maintain and enforce our patents, copyrights, trade secrets, trademarks and other intellectual property rights and prevent third parties from infringing, misappropriating or circumventing those rights.

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Moreover, the global manufacturing and distribution systems for tags or labels incorporating our endpoint IC products could complicate our efforts to enforce our U.S.

As we increasingly work with third parties, possibly including parties that compete with us to an extent, to advance our technical innovations and features, we cannot guarantee that our efforts to protect our intellectual property will be completely effective.

We cannot guarantee that:

Also, a s we increasingly work with third parties, possibly including parties that compete with us to an extent, to advance our technical innovations and solutions offerings, we complicate our efforts to protect our intellectual property.

Specifically, we cannot guarantee that:

• any of the patents, trademarks, copyrights, trade secrets or other intellectual property rights we presently employ in our business will not lapse or be invalidated, circumvented, challenged or abandoned;

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• we will retain the right to ask for a royalty-bearing license to an industry standard if we fail to file an intellectual property declaration pursuant to the standards process;

• we will have or retain the right or ability to file for patents, trademarks or copyrights in technical or solutions opportunities where we work with third parties.

Monitoring and addressing unauthorized use of our intellectual property is difficult and costly, and litigation to enforce our intellectual property rights is time consuming, distracting, expensive and uncertain.

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Because RAIN is a type of RFID, we believe these laws and regulations apply to RAIN.

The European Commission, or the EC, has issued guidance to address privacy concerns about RFID.

The European Commission, or the EC, has issued specific guidance to address privacy concerns about RFID.

In May 2009, the EC issued a recommendation that retailers in the EU inform their customers when RFID tags are either on or embedded within products.

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If our products do not comply or enable compliance with the guidelines, then our business may suffer.

More generally, the data security and privacy legislative and regulatory landscape in the United States, EU and other jurisdictions continues evolving.

Aspects of key laws and regulations addressing data security and privacy—including, for example, the California Consumer Privacy Act of 2018, the California Privacy Rights Act, similar laws enacted in other states and the EU General Data Protection Regulation—remain unclear as of the date of this report and continue evolving, potentially with far-reaching implications.

Laws and regulations relating to privacy, data protection and security;

related industry standards and guidelines;

and continued evolution of these laws, regulations, standards, guidelines and other actual and asserted obligations, as well as their interpretation and enforcement, may require us to modify our products, practices and policies, which we may not be able to do on commercially reasonable terms or at all, and otherwise could cause us to incur substantial costs and expenses.

Any failure or perceived failure by us or any third parties with which we do business to comply with these laws and regulations or other actual or asserted obligations relating to privacy, data protection or security may result in claims or litigation;

actions against us by governmental entities;

legal and other costs;

substantial time and resources and fines, penalties or other liabilities.

Any such actions may be expensive to defend, may incur substantial legal and other costs and substantial time and resources and likely would damage our reputation and adversely affect our business, financial condition and results of operations.

Additionally, if we fail to develop products that meet end-user privacy requirements, then end users may choose not to use our products.

More generally, the cybersecurity and privacy legislative and regulatory landscape in the United States, EU and other jurisdictions continues to evolve.

Aspects of key laws and regulations addressing data security and privacy—including, for example, the California Consumer Privacy Act of 2018, the California Privacy Rights Act, similar laws enacted in other states, the EU General Data Protection Regulation and the EU Cyber Resilience Act—remain unclear as of the date of this report and continue evolving, potentially with far-reaching implications.

Laws and regulations relating to privacy, data protection and cybersecurity, related industry standards and guidelines, and extensions of these laws, regulations, standards, guidelines, etc.

may require us to modify our products, practices and policies.

We may not be able to make these modifications on commercially reasonable terms, if at all.

Any failure or perceived failure by us to comply with these privacy, data protection or cybersecurity requirements could result in adverse consequences such as claims, litigation, legal and other costs, fines, penalties or other liabilities.

Additionally, end users may choose not to use our products.

The RAIN radio protocol includes features addressing consumer privacy and authentication, and we have incorporated additional features in our products that further protect consumer privacy.

Nevertheless, a third party could still breach these features and, if such breach occurs, our reputation could be damaged and our business and prospects could suffer.

Nevertheless, a third party could still breach these features and, if such breach were to occur, our reputation could be damaged and our business and prospects could suffer.

A breach of security or other security incident impacting our systems or others used in our business could have an adverse effect on our business.

6 unchanged sentences

Our platform operates in conjunction with, and depends on, third-party products, services and components for security.

The cybersecurity threat environment continues evolving, especially with heightened activity by state-sponsored actors.

platform, or any of the third parties on which we rely suffers or is believed to have suffered a security breach or other security incident, vulnerability, error, outage, ransomware or malicious event, then we could face increased costs, claims, liability, reduced revenue and harm to our reputation.

The cybersecurity threat environment continues evolving, especially with heightened activity by state-sponsored actors.AI technologies, including AI tools used to identify and exploit security vulnerabilities, may also increase security risks.

If we, our platform, or any of the third parties on which we rely suffers or is believed to have suffered a security breach or other security incident, vulnerability, error, outage, ransomware or malicious event, then we could face increased costs, claims, liability, reduced revenue and harm to our reputation.

We devote resources to detect and prevent security breaches and other security-related incidents.

3 unchanged sentences

We have a history of losses and have only achieved profitability periodically.

We cannot be certain that we will attain or sustain profitability in the future.

We cannot be certain that we will maintain profitability in the future.

We incurred losses each year from our inception in 2000 to 2024.

Our ability to achieve or sustain profitability depends on numerous factors, many of which are not entirely in our control, including continued RAIN industry adoption and us maintaining or growing our market share.

Our ability to maintain profitability depends on numerous factors, many of which are not entirely in our control, including continued RAIN industry adoption and us maintaining or growing our market share.

Our costs of operations, product development and business and personnel expansion in sales, engineering and marketing are significant and are likely to increase as we invest in growing the market and our market share, reducing our costs and improving operations.

30 unchanged sentences

Debt financing, if available, may include covenants limiting or restricting our ability to take specific actions such as incurring additional debt, expending capital or declaring dividends, or may impose financial covenants that limit our ability to achieve our business objectives.

Our management has broad discretion in how to invest and spend our cash and cash equivalents and the proceeds from financings, including on capital expenditures, product development, working capital and other general corporate purposes.

Our management has discretion in how to invest and spend our cash and cash equivalents and the proceeds from financings, including on capital expenditures, product development, working capital and other general corporate purposes.

We may spend our cash and cash equivalents in ways that our stockholders may not agree with or that do not yield favorable returns.

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Our principal stockholders and management beneficially own a significant percentage of our stock and are able to exercise significant influence over matters subject to stockholder approval.

As of March 31, 2026, our executive officers, directors and principal stockholders, together with their respective affiliates, beneficially owned approximately 37.3% of our stock.

As of June 30, 2026, our executive officers, directors and principal stockholders, together with their respective affiliates, beneficially owned approximately 38.2% of our stock.

As a result, our executive officers, directors and principal stockholders may be able to significantly influence, in their capacity as stockholders, matters requiring approval by our stockholders, including electing directors and approving mergers, acquisitions or other transactions.

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Our ability to make scheduled payments of the principal of, to pay interest on or to refinance any current or future indebtedness, including the 2021 Notes and the 2025 Notes, or to make cash payments in connection with any conversion of the 2021 Notes or the 2025 Notes or upon any fundamental change if holders require us to repurchase their 2021 Notes or 2025 Notes for cash, depends on our future performance, which is subject to economic, financial, competitive and other factors beyond our control.

Our business may not generate sufficient future cash from operations to service our indebtedness and make necessary capital expenditures.

If we are unable to generate sufficient cash flow, then we may be required to pursue other alternatives, such as selling assets, restructuring indebtedness or obtaining additional equity capital on terms that may be onerous or highly dilutive.

If we are unable to generate sufficient cash flow to service our debt and make necessary operating and capital expenditures, then we may be required to pursue other alternatives, such as selling assets, restructuring indebtedness or obtaining additional equity capital on terms that may be onerous or highly dilutive.

Our ability to refinance any of our indebtedness, including the 2021 Notes and the 2025 Notes, will depend on the capital markets and our financial condition at that time.

36 unchanged sentences

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-Q

Item 1. Legal Proceedings