What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2026-04-02 compared with 2025-04-15 · 277 added, 338 removed, 25 unchanged (96% of the section changed)

the context requires otherwise, references in this Annual Report to “we,” “us,” “our,” and Algorhythm

refer to Algorhythm Holdings, Inc.

the context requires otherwise, references in this Annual Report to “we,” “us,” and “our,” refer

to Algorhythm Holdings, Inc.

and its consolidated subsidiaries.

otherwise expressly provided in this Annual Report, all historical per share data, number of shares issued and outstanding, stock awards,

and other common stock equivalents set forth herein relating to our common stock have been adjusted to give effect to a reverse stock

split of our common stock in a ratio of 1-for-200 effected on February 10, 2025.

are an AI technology and consumer electronics holding company with two primary business units – SemiCab and Singing Machine.

is an artificial intelligence (“AI”) enabled software logistics business operated through our subsidiary, SemiCab Holdings,

Singing Machine is a home karaoke consumer products business that designs and distributes karaoke products globally to retailers

and ecommerce partners through our subsidiary, The Singing Machine Company, Inc.

Unless otherwise expressly provided in this Annual Report, all historical

per share data, number of shares issued and outstanding, stock awards, and other common stock equivalents set forth herein relating to

our common stock have been adjusted to give effect to a reverse stock split of our common stock in a ratio of 1-for-200 effected on February

are an artificial intelligence (“AI”) technology company focused on the growth and development of SemiCab.

SemiCab is an

AI-enabled software logistics and distribution business that utilizes our SemiCab technology platform to enable retailers, brands

and transportation providers to address common supply chain problems globally.

We operate our SemiCab business through our

subsidiary, SemiCab Holdings, LLC.

to August 1, 2025, we had a second business, which was Singing Machine.

Singing Machine was a home karaoke consumer products business

that designed and distributed karaoke products to retailers and ecommerce partners globally through our subsidiary, The Singing Machine

Company, Inc.

We sold our Singing Machine business on August 1, 2025.

Accordingly, we no longer own or operate the Singing Machine business.

operations include our wholly-owned subsidiaries, SMC Logistics, Inc., a California corporation (“SMCL”), SMC-Music, Inc.,

a Florida corporation (“SMCM”), SMC (HK) Limited, a Hong Kong company (“SMH”), The Singing Machine Company, Inc.,

a Delaware corporation (“Singing Machine”), MICS Hospitality Holdings, Inc., a Delaware corporation (“MICS Hospitality”),

MICS Hospitality Management, LLC, a Delaware limited liability company (“MICS Hospitality Management”), and MICS Nomad, LLC,

a Delaware limited liability company (“MICS NY”), and our 80%-owned subsidiary, SemiCab Holdings, LLC, a Nevada limited liability

company (“SemiCab Holdings”).

is a cloud-based Collaborative Transportation Platform built to achieve the scalability required to predict and optimize loads and the

use of trucks.

To orchestrate collaboration across manufacturers, retailers, distributors, and their carriers, SemiCab uses real-time

data from AI-based load tendering and pre-built integrations with TMS and ELD partners.

To build fully loaded round trips, SemiCab uses

AI/ML techniques and advanced predictive optimization models.

2020, SemiCab has enabled major retailers, brands and transportation providers to address their transportation needs.

Orchestrated Collaboration™ AI model has proven to increase transportation capacity, improve asset utilization, reduce empty miles,

lower logistics costs, and provide visibility into the entire transportation network.

Models show that the technology has the capability

of reducing costs through optimization.

Additionally, SemiCab’s technology has the potential to play a key role in the improved

sustainability model.

Based on its proven ability to improve truck utilization rates, this could result in a dramatic reduction in the

carbon footprint of the industry.

The optimization of existing truck utilization can add trucking capacity without adding more trucks,

drivers or driven miles which addresses common problems plaguing the industry like severe driver shortage and road congestion.

optimization could also reduce carbon emissions attributable to road freight.

Singing Machine, we engage in the development, marketing, and sale of consumer karaoke audio equipment, accessories, and musical recordings.

We are a leading global karaoke and music entertainment company that specializes in the design and production of quality karaoke and

music enabled consumer products for adults and children.

Our products are among the most widely available karaoke products internationally.

mission is to “create joy through music.” To deliver on this mission, we are focused on a multi-prong approach.

In the short-term,

we seek to improve profitability by optimizing operations and continue to expand gross margins.

In the mid-to-long-term, we seek to continue

to expand our business into new verticals including automotive and connected-TV devices and grow our global distribution for our consumer

karaoke products.

a Delaware corporation (“SMC”), and RIME Holdings, LLC (“Rime”), and our 80%-owned subsidiaries, SemiCab Holdings,

LLC, a Nevada limited liability company (“SemiCab Holdings”) and SMCB Solutions Private Limited, an Indian company (“SMCB”).

Events and Developments

in Fiscal Year

2023, our board of directors approved a change in our fiscal year end from March 31 to December 31.

July 3, 2024, we completed the acquisition of substantially all of the assets and the assumption of certain liabilities of SemiCab, Inc.

for a purchase price consisting of 3,210 shares of our common stock and a 20% membership interest in SemiCab Holdings.

August 23, 2023, MICS NY entered into an agreement of lease with OAC 111 Flatiron, LLC and OAC Adelphi, LLC (collectively, the “Landlord”)

pursuant to which MICS NY agreed to lease 10,000 square feet of ground floor retail space and a portion of the basement underneath the

ground floor retail space in the property located at 111 West 24 th Street, New York, New York.

It was our intention to use

this space as a new karaoke venue, offering immersive karaoke technology and audio-visual capabilities, with restaurant and bar offerings.

Due to a lack of funding, however, we initiated termination of the lease in March 2024.

July 26, 2024, the Landlord filed a civil action in the Supreme Court of the State of New York against us and MICS NY for alleged breach

of lease, seeking monetary damages including unpaid rent, future unpaid rent, and other expenses related to the lease.

The complaint

alleged that we and MICS NY breached the lease in various material respects.

September 25, 2024, we and MICS NY entered into a settlement agreement with OAC Flatiron and OAC Adelphi for a full release and dismissal

of the complaint that became effective within five business days of our payment of $250,000 to OAC Flatiron and OAC Adelphi.

full payment of the settlement amount on October 25, 2024, and OAC Flatiron and OAC Adelphi filed a discontinuance with prejudice with

the court on October 29, 2024.

Credit Facility

March 28, 2024, we entered into a loan agreement and related revolving credit note with Oxford Commercial Finance (“Oxford”)

for a $2,000,000 revolving line of credit.

On October 17, 2024, we terminated the loan agreement and note and paid them a termination

fee of $40,000.

As of the date of termination, we had no outstanding amounts owed to Oxford.

and Symbol Change

September 5, 2024, our Certificate of Incorporation was amended to change our name from “The Singing Machine Company, Inc.”

to “Algorhythm Holdings, Inc.” In addition, effective September 8, 2024, our ticker symbol was changed from “MICS”

October 18, 2024, we amended our bylaws to reduce the quorum necessary to hold stockholder meetings from a majority of the voting power

of the shares of our common stock that are issued and outstanding to 33 1/3% of the voting power of the shares of our common stock that

are issued and outstanding.

October 22, 2024, we entered into a securities purchase agreement pursuant to which we agreed to issue and sell to each purchaser:

an original issue discount senior secured note with a principal amount equal to such purchaser’s subscription amount divided by

0.85, and (ii) a number of shares of our common stock equal to (x) 2,300,000, multiplied by (y) such purchaser’s subscription amount,

divided by (z) $2,000,000.

The Offering closed on October 24, 2024.

At the closing, we issued to the purchasers an aggregate of 2,300,000

shares of our common stock and notes in the aggregate principal amount of $2,352,941 for total proceeds of $2,000,000 net of original

issue discount of $352,941.

Univest Securities served as the placement agent in the offering and received seven percent of the gross

proceeds received by us and reimbursement of the legal fees of its counsel.

We repaid all of the notes in December 2024.

Ventures Share Repurchase

November 1, 2024, we entered into a stock repurchase agreement with Regalia Ventures LLC, a Delaware limited liability company (“Regalia

Ventures”), pursuant to which we agreed to pay $472,527 to repurchase 5,495 shares of our common stock that Regalia Ventures had

previously purchased from us on November 20, 2023.

We agreed to issue a promissory note to Regalia Holdings in the principal amount of

the purchase price of the shares at the closing of the transaction.

On February 18, 2025, the date of the closing of the transaction,

we issued a promissory note to Regalia Holdings in the amount of $472,527.

On February 27, 2025, we paid off the note in full.

Ventures is owned and controlled by Jay B.

Foreman, who serves as a member of our board of directors.

Group Share Repurchase

December 3, 2024, we entered into a stock repurchase agreement with Stingray Group, Inc., a Canadian corporation (the “Stingray

Group”), pursuant to which we agreed to pay $285,714 to repurchase 5,495 shares of our common stock that Stingray Group had previously

purchased from us on November 20, 2023.

We agreed to issue a promissory note to Stingray Group in the principal amount of the purchase

price of the shares at the closing of the transaction.

On February 18, 2025, the date of the closing of the transaction, we issued a

promissory note to Stingray Group in the amount of $285,714.

On April 3, 2025, we paid off the note in full.

Mathieu Peloquin is the

Senior Vice-President, Marketing and Communications of Stingray Group and serves as a member of our board of directors.

Offering of Securities

December 4, 2024, we sold 21,000 shares of our common stock and pre-funded warrants to purchase 258,412 shares of our common stock in

lieu of receiving shares of common stock to accredited investors.

Each share of our common stock, or pre-funded warrant in lieu thereof,

was sold together with a Series A warrant to purchase one share of our common stock and a Series B warrant to purchase one share of our

common stock, at an offering price of $34 per share of common stock or pre-funded warrant.

Univest Securities, LLC (“Univest Securities”)

served as our exclusive placement agent in connection with the offering.

We paid Univest Securities a cash fee equal to seven percent

of the aggregate gross proceeds received in the offering and a non-accountable expense allowance equal to one percent of the aggregate

gross proceeds received in the offering.

We also reimbursed Univest Securities for various expenses incurred in connection with the offering.

We received net proceeds of $8,565,000 from the offering, after deducting placement agent fees and other offering expenses.

Direct Offering of Securities

December 18, 2024, we sold 120,337 shares of our common stock to institutional investors in a registered direct offering at a purchase

price of $16.62 per share.

Univest Securities served as our exclusive placement agent in connection with the offering.

We paid Univest

Securities a cash fee equal to eight percent of the aggregate gross proceeds received in the offering.

We reimbursed Univest Securities

for various expenses incurred in connection with the offering.

We received net proceeds of $1,665,000 from the offering, after deducting

placement agent fees and other offering expenses.

Stock Split and Increase in Authorized Shares

6 unchanged sentences

stock split took effect on February 10, 2025.

of Chief Financial Officer & General Counsel

February 13, 2025, our board of directors appointed Alex Andre to serve as our Chief Financial Officer and General Counsel.

Richard Perez, who was terminated as our Chief Financial Officer on that same date.

Product Portfolio

product portfolio consists of our Singing Machine karaoke products and our SemiCab AI logistics and distribution services.

Machine Karaoke Product Offerings

karaoke products are sold directly to distributors and retail customers under our flagship Singing Machine brand name and are offered

at affordable price points that we believe deliver great value to our customers.

All of our karaoke products are Bluetooth® enabled

to allow access to digital music content via our mobile apps available on iOS and Android platforms.

Our core karaoke line offers advanced

features, including but not limited to, enabling customers to output video to a TV screen, correcting singer’s pitch in real-time

with our proprietary PitchLab™ technology, streaming karaoke content directly to the machine via WiFi, casting karaoke songs from

a mobile device to our karaoke machines through our SingCast™ casting technology, singing duets, and displaying scrolling lyrics

in-time with the song.

Our products are sold directly to consumers via our retail channels, ecommerce, our own website, and distributors

Arrangements .

offer innovative Carpool Karaoke Microphone that works specifically in the car.

In 2019, we entered into a 3-year license agreement with

CBS ® for its Carpool Karaoke brand, made popular by James Corden on The Late Show with James Corden.

agreement with CBS expired on September 30, 2022.

On February 28, 2023, we renewed this license agreement for an additional three years.

On March 16, 2023, we entered into a three-year license agreement with Sesame Street Workshop for its Sesame Street brand for karaoke

and singalong toy products, effective January 1, 2023.

Through this license agreement, we develop and offer for sale all the iconic and

beloved Sesame Street characters like Elmo, Big Bird, Cookie Monster, Abby Cadabby, and many more.

and Accessories

offer a line of traditional microphone accessories that are compatible with our karaoke machines.

These microphones feature an assortment

of colors, come wired or wireless, and may include new features like party lighting and voice changing effects.

We also offer portable

Bluetooth microphones which are marketed under our Party Machine brand.

Machine Kids Youth Electronics

have a children’s line of products offered under our Singing Machine Kids brand that have fun music entertainment features designed

specifically for children.

Our products for children introduce singing and music entertainment for young singers and offer advanced features,

such as voice changing effects, recording, Bluetooth compatibility, and portability.

intend to enter the connected vehicle karaoke device market through a partnership that we have with Stingray Group.

We have developed

microphone hardware utilizing our PitchLab™ technology to offer integrated wireless microphones for connection with major automotive

brand’s vehicles.

We are currently in discussions with many automotive brands to offer these products.

Subscriptions

conjunction with Stingray Group, we offer karaoke music subscription services for the iOS and Android platforms as well as a web-based

download store and integrated streaming services for our hardware.

We currently offer almost 20,000 licensed karaoke songs in the catalog.

SemiCab AI Logistics and Distribution

Transportation

offers transportation services to shippers and brokers that deliver products for retailers and manufacturers.

SemiCab primarily focuses

on full truck load and over-the-road transportation services.

SemiCab’s services are sold directly to shippers via bids for transportation

These bids are typically awarded for a selected number of routes for a pre-determined period of time, normally up to a year.

Subscription for Shippers

service category consists of a SaaS based platform subscription for shippers that enables them to better manage their freight network

by creating optimal lane bundles for bidding and optimized execution of loads with better control over their data and analytics.

Subscription for Brokers

also offers a software-as-a-service (“SaaS”) based platform subscription for logistics brokers that enables them to better

manage their operations for transportation execution.

The subscription primarily covers shipper management, carrier management, document

management, load operations management, invoicing, integration services, and reporting and analytics.

Development and Design

Singing Machine Karaoke Product Offerings

development is a key element of our strategic growth plan for our karaoke products.

We strive to deliver many new, exciting consumer

products to market every single year to retain and strengthen our presence in consumer karaoke products.

Strategic product development

is done in-house from our corporate headquarters in Fort Lauderdale, FL where we identify new potential categories, features, and price

Products are created in conjunction with contract product designers and inventors in collaboration with our contract manufacturers

in China to deliver products that represent tremendous value to our customers.

In addition to new products, we always look for ways to

improve existing products to hit more affordable price points or improve features based upon market feedback.

SemiCab AI Logistics and Distribution

our SemiCab logistics and distribution services, we are focused on expanding and enhancing our SemiCab platform to provide better transportation

services to our customers as well as to automate operational processes.

The objective of these additions and enhancements is to build

additional functionality and improve or automate existing functions.

This will make us more efficient, lower the costs of operation,

provide consistent and reliable services, and reduce potential human error in its processes targeting the transportation execution and

We maintain a small, dedicated software development team in India to build, host, maintain and enhance our SemiCab platform.

and Manufacturing

Machine Karaoke Product Offerings

source our karaoke products from a variety of contract manufacturers in southern China.

We are not dependent on any one supplier as we

use multiple manufacturers to make our products.

We maintain a Hong Kong office that provides us with factory management, sourcing, quality

control, engineering, and product development.

We buy finished goods from our suppliers and generally do not source raw materials for

manufacturing, however in limited circumstances where we develop proprietary hardware and software, we will secure the proprietary circuits

and provide them to our contract manufacturers for assembly into the final product.

While we are not responsible for sourcing raw materials,

we rely on our contract manufacturers’ ability to secure injected plastic, wood cabinets, integrated circuits, display panels,

speaker drivers, and other components that are necessary for assembly into our final products.

karaoke products are manufactured by our contract manufacturers and are either shipped via ocean vessels to our two third-party logistics

(“3PL”) warehouses located in California and Canada or we utilize a direct import program where our retail customers coordinate

to pick up the goods FOB China.

The direct import program allows our customers to take advantage of better ocean container rates through

bigger volume and allows us to bypass our 3PL warehouses.

We sell directly to retail customers and independent channels in Canada from

our 3PL warehouse in Canada.

Historically, most of our customers pick up goods from our warehouse (freight collect).

August 31, 2023, the lease at our Ontario, California warehouse facility expired and was not renewed.

Instead, we outsourced this business

function by entering into a service agreement with a 3PL company to provide domestic and Canadian warehousing services, effective September

SemiCab AI Logistics and Distribution

do not utilize any suppliers or manufacturers in connection with our SemiCab logistics and distribution services.

May 2, 2025, we and SemiCab Holdings entered into an equity purchase agreement with SemiCab Inc.

pursuant to which:

(i) SemiCab Holdings

purchased 9,999 shares of the issued and outstanding equity shares, Rs.

10 par value, of SMCB, representing 99.99% of the issued and

outstanding equity shares of SMCB, for $1,750,000, the payment of which amount was evidenced by the issuance of a promissory note by

us to SemiCab, Inc., and (ii) we purchased the 20% membership interest in SemiCab Holdings then held by SemiCab, Inc.

for aggregate consideration

consisting of 119,742 shares of our common stock.

The transactions closed on May 2, 2025.

The promissory note provides that $1,500,000

is due and payable by us on the first anniversary of the closing date and the remaining $250,000 is due and payable by us on the 18-month

anniversary of the closing date.

The promissory note bears interest at six percent per annum.

the closing date, we and SemiCab Holdings entered into an amended and restated employment agreement with each of Ajesh Kapoor and Vivek

Sehgal pursuant to which Mr.

Kapoor agreed to serve as the Chief Executive Officer and Chief Technology Officer of SemiCab Holdings and

Sehgal agreed to serve as the Chief Product Officer of SemiCab Holdings.

Pursuant to the terms of the employment agreements, SemiCab

Holdings granted Messrs.

Kapoor and Sehgal a membership interest in SemiCab Holdings with three quarters of each such grant subject to

certain forfeiture rights tied to continued employment with SemiCab Holdings.

Additionally, Mr.

Kapoor was granted the right to serve

as a member of our board of directors and the right to appoint an additional member of our board of directors upon the occurrence of

certain specified events.

on the closing date, we, SemiCab Holdings, Ajesh Kapoor and Vivek Sehgal entered into an amended and restated limited liability company

agreement for SemiCab Holdings which sets forth the terms and conditions governing the operation and management of SemiCab Holdings.

January 2026, the Indian government approved the purchase of the remaining outstanding equity share of SMCB, representing 0.01% of the issued and outstanding equity shares of SMCB, from Sudheer Srinivas Kadandale

of Singing Machine

August 1, 2025, we entered into an asset purchase agreement with SMC and Stingray Music USA, Inc.

(“Stingray USA”), a related

party and subsidiary of the Stingray Group, Inc.

(“Stingray Group”), pursuant to which Stingray USA purchased substantially

all of the assets, and assumed most of the liabilities, associated with our Singing Machine business for $500,000.

The transaction closed

on August 1, 2025.

Streeterville

Capital Transaction

August 21, 2025, we entered into a securities purchase agreement with Streeterville Capital, LLC, a Utah limited liability company (“Streeterville”), pursuant to which we agreed to issue and sell to Streeterville shares of our common stock in one or more pre-paid purchases (each, a “Pre-Paid Purchase” and collectively, the “Pre-Paid Purchases”)

for an aggregate purchase price of up to $20,000,000 (the “Streeterville Transaction”).

We also agreed to issue an additional

95,694 shares of our common stock to Streeterville as a commitment fee for the pre-paid purchase facility established under the securities

purchase agreement (the “Commitment Shares”).

The securities purchase agreement provides for a two-year commitment period

during which, subject to certain specified conditions, we may request additional Pre-Paid Purchases from Streeterville provided that

the amount requested is no less than $250,000 and the total outstanding balance of all Pre-Paid Purchases does not exceed $3,000,000.

The original issue discount for each additional Pre-Paid Purchase will be nine percent of the amount set forth in the applicable request

and each additional Pre-Paid Purchase will accrue interest at the rate of nine percent per annum.

We also executed a guaranty, a security

agreement, and intellectual property security agreement in favor of Streeterville as part of the Streeterville Transaction.

The Streeterville

Transaction closed on August 21, 2025.

the funding of each Pre-Paid Purchase, Streeterville has the right, but not the obligation, to purchase from us that number of

shares of common stock up to the lesser of:

(i) a number of shares of common stock equal in value to the outstanding balance of the

funded amount, and (ii) that number of shares of common stock such that Streeterville will not beneficially own greater than 9.99%

of our outstanding shares of common stock.

The purchase price of the shares of common stock will be 90% of the lowest daily volume

weighted average price during the 10 trading days immediately prior to the purchase notice date, but not less than the floor price,

which is the greater of:

(i) 20% of the “Minimum Price” as defined under Nasdaq Listing Rule 5635(d) prior to the

applicable closing of the Pre-Paid Purchase, and (ii) $0.10.

to the terms of the securities purchase agreement, we filed a registration statement on Form S-1 under the Securities Act with the SEC

to register the resale of the Commitment Shares and all shares of common stock issuable pursuant to the Pre-Paid Purchases.

The registration

statement became effective on November 10, 2025.

Listing Rule 5635(d) provides that shareholder approval is required prior to the issuance of shares of our common stock equal or greater

in number to 20% of the number of shares of our common stock issued and outstanding immediately prior to the completion of the proposed

issuance at a price that is less than the “Minimum Price” as such term is defined under Nasdaq Listing Rule 5635(d) in a

transaction that is not a public offering.

We obtained the requisite shareholder approval for the Streeterville Transaction on November

may at any time prepay all or any portion of the outstanding balance of a Pre-Paid Purchase.

In the event we elect to do so, we must

pay Streeterville an amount equal to 110% multiplied by the portion of the outstanding balance we elected to prepay.

If an event of default

occurs under a Pre-Paid Purchase, the outstanding balance will become immediately due and payable.

At anytime thereafter, upon written

notice given by Streeterville, the outstanding balance will increase by seven-and-a half percent and interest will begin accruing at

a rate of the lesser of 18% per annum or the maximum rate permitted under applicable law.

Our obligations are secured by all of our assets

pursuant to a security agreement and have been guaranteed by our operating subsidiaries pursuant to a guarantee, each entered into with

Streeterville on August 21, 2025.

Securities, LLC served as the placement agent in the offering (“Univest”).

We agreed to pay Univest a cash fee equal to eight percent of the aggregate gross proceeds that we receive from any

Pre-Paid Purchases that we complete and reimburse Univest for legal fees in the amount of $40,000.

securities purchase agreement provides for an initial Secured Pre-Paid Purchase in the principal amount of $4,390,000, before deducting

an original issue discount of $360,000 and transaction expenses of $30,000 (the “First Pre-Paid Purchase”), the terms of

which are set forth on secured prepaid purchase #1 (“Pre-Paid Purchase #1”).

The First Pre-Paid Purchase accrues interest

at the rate of nine percent per annum and has a maturity date of three years.

We paid Univest a cash fee equal to eight percent of the aggregate gross proceeds that we received from the First

Pre-Paid Purchase.

We currently have principal in the amount of approximately

$1,085,000 outstanding under the First Pre-Paid Purchase.

November 13, 2025, we entered into Secured Pre-Paid Purchase #2 with Streeterville (“Pre-Paid Purchase #2”).

Pre-Paid Purchase

#2 provides for a second Pre-Paid Purchase in the principal amount of $5,450,000, before deducting an original issue discount of $450,000

(the “Second Pre-Paid Purchase”).

The Second Pre-Paid Purchase accrues interest at the rate of nine percent per annum and

has a maturity date of three years.

Second Pre-Paid Purchase was similar to the First Pre-Paid Purchase, however the Second Pre-Paid Purchase is secured by cash in an

amount not less than the lesser of:

(i) $4,500,000, and (ii) 90% of the then-current outstanding balance of the Second Pre-Paid Purchase

(the “PPP2 Minimum Balance Amount”).

The secured funds are being held in a deposit account (the “DACA Account”)

held by RIME Holdings, LLC, a Utah limited liability company and wholly-owned subsidiary of ours that we formed in connection with this

transaction (“RIME Holdings”), pursuant to a Deposit Account Control Agreement, dated November 13, 2025, by and among RIME

Holdings, Lakeside Bank, an Illinois banking company (“Lakeside Bank”), and Streeterville.

Accordingly, of the $5,000,000

proceeds that we received from the Second Pre-Paid Purchase, $4,500,000 were placed in the DACA Account.

have the right to use funds in the DACA Account to repay any portion of the outstanding balance of the Second Pre-Paid Purchase, but

only so long as the payment does not cause the outstanding balance to drop below the PPP2 Minimum Balance Amount.

As long as no event

of default has occurred, the Company may withdraw from the Deposit Account any funds in excess of the PPP2 Minimum Balance Amount.

Holdings executed a guaranty of the obligations outstanding under the Second Pre-Paid Purchase for the benefit of Streeterville.

entered into a new placement agency agreement with Univest that superseded the placement agency agreement that we previously entered

into with them on August 21, 2025.

We agreed to pay Univest a cash fee equal to eight percent of the aggregate gross proceeds that we

receive from any Pre-Paid Purchases that we complete and reimburse Univest for legal fees in the amount of $50,000.

The Second Pre-Paid

Purchase was repaid in full on December 11, 2025.

December 19, 2025, we entered into Secured Pre-Paid Purchase #3 with Streeterville (“Pre-Paid Purchase #3”).

Pre-Paid Purchase

#3 provides for a third Pre-Paid Purchase in the principal amount of $1,090,000, before deducting an original issue discount of $90,000

(the “Third Pre-Paid Purchase”).

The Third Pre-Paid Purchase accrues interest at the rate of nine percent per annum and has

a maturity date of three years.

We paid Univest a cash fee equal to eight percent of the aggregate gross proceeds that we received from

the Third Pre-Paid Purchase.

The Third Pre-Paid Purchase was repaid in full on December 23, 2025.

February 17, 2026, we entered into Secured Pre-Paid Purchase #4 with Streeterville (“Pre-Paid Purchase #4”).

Pre-Paid Purchase

#4 provides for a fourth Pre-Paid Purchase in the principal amount of $10,355,000, before deducting an original issue discount of $855,000

(the “Fourth Pre-Paid Purchase”).

The Fourth Pre-Paid Purchase accrues interest at the rate of nine percent per annum and

has a maturity date of three years.

The Fourth Pre-Paid Purchase is similar to the Second Pre-Paid Purchase in that the Fourth Pre-Paid

Purchase is secured by cash in an amount not less than the lesser of:

(i) $3,500,000, and (ii) 90% of the then-current outstanding balance

of the Fourth Pre-Paid Purchase (the “PPP4 Minimum Balance Amount”).

Accordingly, of the $9,500,000 in proceeds that we received

from the Fourth Pre-Paid Purchase, $3,500,000 was placed in the DACA Account.

have the right to use funds in the DACA Account to repay any portion of the outstanding balance of the Fourth Pre-Paid Purchase, but

only so long as the payment does not cause the outstanding balance to drop below the PPP4 Minimum Balance Amount.

As long as no event

of default has occurred, we may withdraw from the Deposit Account any funds in excess of the PPP4 Minimum Balance Amount.

RIME Holdings

executed a guaranty of the obligations outstanding under the Fourth Pre-Paid Purchase for the benefit of Streeterville.

paid Univest a cash fee equal to eight percent of the aggregate gross proceeds received by us from the Fourth Pre-Paid Purchase that

were not placed in the DACA Account.

We will pay Univest a cash fee equal to eight percent of the funds held in the DACA Account when

they are released to us.

have not repaid any of the principal outstanding under the Fourth Pre-Paid Purchase.

SemiCab Technology Platform

logistics platforms and systems optimize visible demand by optimizing individual lanes within the logistics network.

Freight planning,

execution, and exception management rely heavily on manual workflows and fragmented systems.

As volumes increase, costs typically scale

linearly with headcount, limiting profitability and operational flexibility.

SemiCab technology platform is an AI-enabled, cloud-based collaborative transportation platform that operates at the network level.

achieves the scalability required to predict and optimize millions of loads and hundreds of thousands of trucks.

It uses real-time data

from application programming interface (“API”)-based load tendering and pre-built integrations with transportation management

system (“TMS”) partners, warehouse management system (“WMS”) partners, and electronic logging device (“ELD”)

partners to orchestrate collaboration across manufacturers, retailers, distributors, and their carriers.

It uses AI and machine learning

predictions and advanced predictive optimization models to enable fully loaded round trips.

By pooling demand and supply across shippers,

regions, and timeframes, the platform identifies return legs and cross-lane flows that are invisible under conventional planning models.

This approach enables structural efficiency improvements rather than episodic or temporary gains.

directly supports stronger unit economics and capital efficiency for our customers.

It has successfully enabled individual operators

to manage more than 2,000 loads annually.

As volumes increase, our customers benefit from lower cost per load, greater asset

utilization, lower administrative overhead and more predictable service levels.

By automating network-level decision-making, the

platform allows organizations to scale throughput without proportional increases in labor, infrastructure, or overhead.

are focused on expanding and enhancing our SemiCab technology platform to provide better transportation services to our customers as

well as to automate operational processes.

The objective of these additions and enhancements is to build additional functionality and

improve or automate existing functions.

This will make us more efficient, lower our costs of operation, enable us to provide more consistent

and reliable services, and reduce potential human error in our processes targeting transportation execution and billing.

employ a dedicated software development team that maintains and enhances our SemiCab technology platform.

Service Offering

service offering consists of contract-based, long-haul, full truckload transportation logistics and distribution services that utilize

our SemiCab technology platform.

We currently provide our services in India and are actively marketing our services in the United States

India, we offer our services through a managed services model to retailers, suppliers and manufacturers and other shippers through our

own network of shippers and brokers.

We primarily focus on full truck load and over-the-road transportation services.

Our services are

sold directly to shippers via bids for transportation services.

These bids are typically awarded for a selected number of routes for

a pre-determined period of time, normally up to a year.

and other countries, we offer our services through a software-as-a-service (“SaaS”) model called “Apex”

by selling subscriptions to shippers, carriers and third-party logistics providers (“3PLs”) to utilize our SemiCab technology

Our software enables shippers and carriers to better manage their freight network by creating optimal lane bundles for bidding

and optimized execution of loads with better control over their data and analytics.

Our software enables 3PLs to better manage their

operations for transportation execution by assisting them with shipper management, carrier management, document management, load operations

management, invoicing, integration services, and reporting and analytics.

optimizes both visible and predicted demand across the entire freight ecosystem, completely redefining the efficiencies that can be achieved

within a logistics network.

Through Apex, shippers, carriers and 3PLs can:

their own branded logistics operating systems, embedding SemiCab’s AI logic, dashboards, and APIs;

multi-party freight networks that reduce empty miles and unlock shared efficiencies;

seamlessly with existing TMS, WMS, and telematics systems through open APIs;

predictive analytics and benchmarking to identify cost savings and improve yield per lane.

SemiCab technology platform enhances traditional logistics platforms by providing them with predictive, self-learning orchestration that

automates network coordination at scale.

It continuously learns from network activity, dynamically adjusting routing, pooling, and capacity

allocation in real time.

and Marketing

Machine Karaoke Product Offerings

karaoke products are marketed and sold through our direct sales team, working in conjunction with independent sales representatives that

provide sales and customer support for our retail customers in North America.

We seek to expand our direct-to-consumer sales, which we

believe will increase overall gross margins and increase brand awareness.

Sales are recognized upon transfer of title to our customers

and are made utilizing standard credit terms of 60 to 90 days.

Our sales terms indicate that we only accept returns for defective merchandise,

however we have accepted overstock returns from our retail partners in the past.

promotion, and consumer engagement are key elements in the youth electronics, toy, and music categories.

Historically, a significant

percentage of our promotional spending has been structured as co-op promotion incentives with our large retail partners.

to focus our marketing efforts on growing brand awareness among our target consumer demographic, optimizing marketing investments, and

executing an integrated marketing strategy.

We believe that an important component of our future growth is based on speaking to the right

customer, with the right content, in the right channel, at the right time.

We have implemented online marketing, social media, and digital

analytics tools, which allow us to better measure the performance of our marketing activities, learn from our consumers, and receive

valuable insights into industry and competitor activities.

service is a critical component of our marketing strategy for our karaoke products.

We maintain a U.S.-based internal customer service

department within our corporate headquarters that responds to customer inquiries, investigates, and resolves issues, and is available

to assist customers and consumers during business hours.

SemiCab AI Logistics and Distribution

SemiCab logistics and distribution services are sold through our direct sales team who work with shippers, participate in preparing and

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executed and delivered by us.

platform subscriptions are sold through resellers.

Sales are recognized on a rolling monthly basis aligned with SaaS revenue models.

uses limited marketing and promotions at this time as it is primarily focused on creating name recognition and visibility through appropriate

social media channels, blogs, and press releases to share industry awards and customer acquisition news.

Singing Machine Karaoke Product Offerings

respect to our karaoke products, the youth electronics, toy, and music industries have many participants, none of which have a dominant

market share, though certain companies may have disproportionate strength in specific product categories.

We compete with a number of

different companies in a variety of categories, although there is no single company that competes with us across all of our product categories.

Our largest direct competitors are Singsation ® , Singtrix ® , eKids ® , Bonaok, Karaoke USA ™ ,

and Ion ® Audio.

The primary methods of competition in the industry consist of brand positioning, product innovation, quality,

price, and timely distribution.

Our competitive strengths include our ability to develop innovative new products and features, speed

to market, our relationships with major retailers, and the quality and pricing of our products.

SemiCab AI Logistics and Distribution

the AI logistics and distribution space, we compete with traditional and non-traditional logistics companies, including transportation

providers that own equipment, third-party freight brokers, technology matching services, internet freight brokers, carriers offering

logistics services, and on-demand transportation service providers.

We win business by providing reliable services at lower costs and

creating an industry-wide network that can operate more efficiently with less empty miles than the industry norm, thus creating a more

sustainable transportation network for the entire industry.

rely on a combination of word and design mark trademarks and trade secrets to protect our intellectual property.

In certain circumstances,

we will partner with third parties to develop proprietary products, and, where appropriate, we have license agreements related to the

use of third-party innovation in our products.

Our platform subscriptions are sold through a direct sales team.

Sales are recognized on a rolling monthly basis

aligned with SaaS revenue models.

We engage in only limited marketing and promotions at this time as we are primarily focused on creating

name recognition and visibility through appropriate social media channels, blogs, and press releases to share industry awards and customer

acquisition news.

customers are comprised primarily of large, fast-moving consumer products companies in India.

Our target customers in the United States

and Europe are comprised primarily of 3PLs and carriers and shippers of consumer products.

transportation services industry is highly competitive and fragmented.

We compete with traditional and non-traditional logistics companies,

including transportation providers that own equipment, third-party freight brokers, technology matching services, internet freight brokers,

carriers offering logistics services, and on-demand transportation service providers.

We win business by providing reliable services

at lower costs and creating an industry-wide network that can operate more efficiently with less empty miles than the industry norm,

thus creating a more sustainable transportation network for the entire industry.

rely on a combination of cybersecurity, trademarks, copyrights, trade secrets, and nondisclosure and non-competition agreements to establish

and protect our intellectual property and proprietary technology.

In certain circumstances, we will partner with third parties to develop

proprietary technology, and, where appropriate, we have license agreements related to the use of third-party innovation in our technology.

The duration of our trademark registrations varies from country to country.

However, trademarks

are generally valid and may be renewed indefinitely as long as they are in use and/or their registrations are properly maintained.

Singing Machine Karaoke Product Offerings

operate across geographically diverse marketplaces and sell our karaoke products globally to large, national retailers as well as independent

retailers, on our retailer’s websites, and our own direct to consumer website.

In North America, our customers include Amazon,

Costco, Sam’s Club, Target and Wal-Mart.

Our largest international territories are the U.K.

and Australia, where we sell through

international distributors.

We also sell to select international retail customers in geographic locations where we do not have a direct

sales presence.

to our top five customers and top three customers collectively in our karaoke business comprised 79% and 81% of our revenue, respectively, for the

year ended December 31, 2024 and the nine-month transition period ended December 31, 2023, respectively.

We have no long-term

contracts with these customers, and as a result, our success depends heavily on our customers’ willingness to purchase and

provide floor or shelf space for our products.

SemiCab AI Logistics and Distribution

the logistics industry, we provide our contract-based, long-haul, full truckload transportation services in the United States.

our services to any shipper that may need such services on an ongoing basis.

Our customers include Staples and Pepsi.

Singing Machine Karaoke Product Offerings

experience heightened seasonal demand for our karaoke products, typically beginning in late July, and extending into early November of

each calendar year, which is accounted for in our quarters ended September 30 th and December 31 st .

Transportation

demand is also seasonal by nature.

In the US, freight demand typically increases before the holidays and reduces after the holiday season

The agricultural produce seasons may also affect the freight markets.

In India, agricultural and festival seasons drive the

market seasons for freight.

SemiCab AI Logistics

and Distribution Services

the AI logistics and distribution space, the transportation industry not only experiences seasonality, but it is cyclic as well and goes

through regular boom and bust cycles.

Capacity falls when demand and prices are high.

By contrast, smaller operators go out of business

when supplies build up and depress prices.

Singing Machine Karaoke Product Offerings

of our karaoke products are designed to comply with all applicable mandatory and voluntary safety standards.

In the United States, these

safety standards are promulgated by federal, state and independent agencies such as the United States Consumer Product Safety Commission,

ASTM International, the Federal Communications Commission, and various states Attorney Generals and state regulatory agencies.

our products are independently tested by third party laboratories accepted by the Consumer Product Safety Commission to verify compliance

to applicable safety standards.

A similar approach is used to design and test products sold internationally.

SemiCab AI Logistics and Distribution

respect to our SemiCab AI logistics and distribution services, the transportation industry in the Unites States is regulated by the Department

of Transportation.

However, trademarks are generally valid and may be renewed

indefinitely as long as they are in use and/or their registrations are properly maintained.

operating results have been subject to seasonal trends as a result of, or as influenced by, numerous factors, including national holidays,

weather patterns, consumer demand, economic conditions, and other similar and subtle forces.

Although seasonal changes in the transportation

industry have not had a significant impact on our cash flow or results of operations, we cannot guarantee that they will not adversely

impact us in the future.

Ministry of Road Transport and Highways is the primary regulator for the road transport and automotive industry in India, overseeing

policy, regulations, and standards in that country.

Department of Transportation regulates the transportation industry in the

United States.

This federal agency mandates licensing, insurance and service requirements on the operators in this industry.

of April 14, 2025, we had a total of 25 employees.

None of our employees are represented by a collective bargaining unit or is a party

to a collective bargaining agreement.

are also subject to laws and regulations in the United States and India concerning the handling of personal information, including laws

that require us to notify governmental authorities and/or affected individuals of data breaches involving certain personal information.

Additionally,

as a publicly-traded company and issuer of stock, we are subject to and maintain compliance with various anti-corruption and anti-bribery

statutes such as the U.S.

Foreign Corrupt Practices Act.

We may in the future be subject to certain other foreign countries’ equivalent

statutes or programs in the countries in which we operate.

of March 27, 2026, we had a total of 49 employees, of which 46 were full-time employees and three were part-time employees.

employees are represented by a collective bargaining unit or is a party to a collective bargaining agreement.

file reports and other materials with the Securities and Exchange Commission (“SEC”), including annual reports on Form 10-K,

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We make available free of charge through our website

at https://ir.algoholdings.com/investor-filings#/ all materials that we file electronically with the SEC as soon as reasonably

practicable after electronically filing or furnishing such material with the SEC.

These materials are also available on the SEC’s

website at www.sec.gov.

at https://algoholdings.com/filings all materials that we file electronically with the SEC as soon as reasonably practicable after electronically

filing or furnishing such material with the SEC.

These materials are also available on the SEC’s website at www.sec.gov.

information contained on, or accessible through, our website and the SEC’s website does not constitute a part of this report.

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

What changed 10-K

Item 1. Business