What changed in this filing

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Item 1A. Risk Factors

2025-03-24 compared with 2024-04-01 · 456 added, 392 removed, 1059 unchanged (44% of the section changed)

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have incurred net losses since inception.

In addition, in recent years, we have shifted our business strategy to transition developing

In addition, in recent years, we have shifted our business strategy to transition to developing

and manufacturing smart products and technologies and further evolved our strategy by acquiring an online retailer and e-commerce provider

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delays resulting from, among other things, difficulties finding suppliers, shipping disruptions and delays resulting in late deliveries

of necessary supplies and materials, chip shortages, increases in expected costs due to inflationary pressures and material shortages,

or delays resulting from a need or desire to obtain additional certifications for new product configurations, or (ii) our e-commerce

operations, such as the potential for reduced discretionary consumer spending, shipping disruptions or delays, or our products not

meeting consumer expectations;

of necessary supplies and materials, chip shortages, tariffs and other trade barriers or restrictions, increases in expected costs

due to inflationary pressures and material shortages, or delays resulting from a need or desire to obtain additional certifications

for new product configurations, or (ii) our e-commerce operations, such as the potential for reduced discretionary consumer spending,

shipping disruptions or delays, or our products not meeting consumer expectations;

difficulties, including continuing to integrate our retail operations with our Sky Technologies product and technologies operations;

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achieve our strategic initiatives, grow our business and streamline our operations at a profitable level.

have incurred substantial losses in the past and reported net losses from operations of approximately $37.4 million and $26.6

million during 2023 and 2022, respectively.

As of December 31, 2023, we had an accumulated deficit of approximately $145.4

have incurred substantial losses in the past and reported net losses from operations of $35.8 million and $39.7 million during 2024 and

2023, respectively.

As of December 31, 2024, we had an accumulated deficit of $181.8 million.

cannot assure you that we can achieve or sustain profitability in the future.

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launch and market our new products and technologies, grow our sales, including our retail operations, maintain cost control discipline

while balancing development of our enhanced “all-in-one” Smart Sky Platform, costs relating to our retail operations and

potential long-term revenue growth, continue our efforts to reduce product cost, drive operating efficiencies and develop and execute

our key strategic initiatives.

Our planned expense levels are, and will continue to be, based in part on our expectations, which are

difficult to forecast accurately based on our stage of development, our recently acquired retail business, and factors outside of our

Developing and marketing our products and technologies is costly, and we anticipate our costs will increase in the future as

we continue to invest in our research and development efforts, expand our operations, and make additional expenditures to develop and

market our products and technologies, including new features, integrations, capabilities, and enhancements.

Our expenditures may not

result in improved business results or profitability over the long term, and our expenses may be greater than we anticipate, including

due to, among other things, an increase in legal risk from the use of our products and technologies due to evolving laws, regulations

or standards and from our expansion into retail operations, an inability to timely and cost-effectively introduce and sell successful

smart products and other products and technologies, a security incident or our failure, for any reason, to capitalize on growth opportunities.

In addition, we may be unable to adjust spending in a timely manner to compensate for any unexpected developments.

There is a risk that

our strategy to operate profitably may not be as successful as we envision or occur as quickly as we expect.

We may not achieve our business

objectives, and the failure to achieve such goals would have an adverse impact on us.

To the extent that our revenues do not increase

commensurate with our costs, our business, operating results, and financial condition will be materially and adversely affected.

while balancing development of our enhanced “all-in-one” Smart Sky Platform, manage costs relating to our retail operations

and potential long-term revenue growth, continue our efforts to reduce product cost, drive operating efficiencies and execute our key

strategic initiatives.

Our planned expense levels are, and will continue to be, based in part on our expectations, which are difficult

to forecast accurately based on our stage of development, our acquisition of the retail business, and factors outside of our control.

Developing and marketing our products and technologies is costly, and we anticipate our costs will increase in the future as we continue

to invest in our research and development efforts, expand our operations, and make additional expenditures to develop and market our

products and technologies, including new features, integrations, capabilities, and enhancements.

Our expenditures may not result in improved

business results or profitability over the long term, and our expenses may be greater than we anticipate, including due to, among other

things, an increase in legal risk from the use of our products and technologies due to evolving laws, regulations or standards and from

our expansion into retail operations, an inability to timely and cost-effectively introduce and sell successful smart products and other

products and technologies, a security incident or our failure, for any reason, to capitalize on growth opportunities.

In addition, we

may be unable to adjust spending in a timely manner to compensate for any unexpected developments.

There is a risk that our strategy

to operate profitably may not be as successful as we envision or occur as quickly as we expect.

We may not achieve our business objectives,

and the failure to achieve such goals would have an adverse impact on us.

To the extent that our revenues do not increase commensurate

with our costs, our business, operating results, and financial condition will be materially and adversely affected.

will require additional financing in the near-term, and if our operations do not achieve, or we experience an unanticipated delay in

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terms, or at all, and could require us to sell certain assets or discontinue or curtail our operations.

cannot ascertain that there are no substantial doubt about our ability to continue as a going concern.

cannot ascertain that there is no substantial doubt about our ability to continue as a going concern.

We will not be able to achieve

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if we cannot successfully

launch our products or further develop them to include additional features, or our products and technologies fail to satisfy customer

launch our products or further develop them to include additional features, our products and technologies fail to satisfy customer

demands or achieve widespread market acceptance, our business, operating results, financial condition, and growth prospects would be

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could result in a material adverse impact on our business.

addition, we have no experience in manufacturing our smart products.

addition, we have limited experience in manufacturing our smart products.

We may be unable to develop efficient, cost-efficient manufacturing

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certain products, preorders are not commitments to purchase our products and are subject to cancellation by customers.

If our existing

preorder and prospective customers do not perceive our products to be of sufficiently high value and quality, cost competitive and appealing

in aesthetics or performance, we may not be able to retain our current preorder customers or attract new customers, and our business,

prospects, financial condition, results of operations, and cash flows would suffer as a result.

In addition, we may incur significantly

higher and more sustained advertising and promotional expenditures than we have previously incurred to attract customers.

Until the time

that the smart products are commercially available for purchase and we are able to scale up our marketing function to support sales,

there will be significant uncertainty as to customer demand for our smart products and technologies and the sales that we will be able

Further, demand for our products and technologies will be affected by a number of factors, many of which are beyond our control,

such as our ability to obtain market acceptance;

All preorders

have been fulfilled.

If our existing preorder and prospective customers do not perceive our products to be of sufficiently high value

and quality, cost competitive and appealing in aesthetics or performance, we may not be able to retain our current preorder customers

or attract new customers, and our business, prospects, financial condition, results of operations, and cash flows would suffer as a result.

In addition, we may incur significantly higher and more sustained advertising and promotional expenditures than we have previously incurred

to attract customers.

Although some of our smart products are now commercially available, there is still significant uncertainty as to

customer demand for our smart products and technologies and whether we will be able to achieve additional sales.

Further, demand for

our products and technologies is and will continue to be affected by a number of factors, many of which are beyond our control, such

as our ability to obtain market acceptance;

declines in consumer discretionary spending;

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growth, contraction and rapid evolution of our market;

supply chain disruptions and shortages, including the potential impact

of tariffs and other trade barriers and restrictions;

and general economic conditions and trends.

we are unable to successfully release our smart products and technologies, enhance their capabilities, meet demands of our customers

or trends in preferences or achieve widespread market acceptance of our products and technologies, our business, results of operations

and financial condition could be harmed.

In addition, competitors may develop or acquire their own products or technologies, and people

may continue to rely on traditional products and technologies or existing smart home products, which would reduce or eliminate the demand

for our smart products.

we are unable to successfully release all of our planned smart products and technologies, enhance their capabilities, meet demands of

our customers or trends in preferences or achieve widespread market acceptance of our products and technologies, our business, results

of operations and financial condition could be harmed.

In addition, competitors may develop or acquire their own products or technologies,

and people may continue to rely on traditional products and technologies or existing smart home products, which would reduce or eliminate

the demand for our smart products.

If demand declines for any of these or other reasons, our business could be adversely affected.

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These adverse economic conditions include inflation, slower growth or recession, new or increased tariffs

and other changes to fiscal and monetary policy, higher interest rates, high unemployment, decreased consumer confidence in the economy,

armed hostilities, such as the ongoing military conflict between Russia and Ukraine and the Israel-Hamas war, foreign currency exchange

rate fluctuations, conditions affecting the retail environment for products we sell, and other matters that influence consumer spending

and preferences.

In addition, consumer confidence and spending can be materially adversely affected in response to financial market volatility,

negative financial news, conditions in the real estate and mortgage markets, including home equity loans and consumer credit, changes

in net worth based on market changes and uncertainty, energy shortages and cost increases, labor and healthcare costs, government actions

and general uncertainty regarding the overall future economic environment.

may view a substantial portion of the products we offer as discretionary items rather than necessities.

As a result, our operating results

are sensitive to changes in macroeconomic conditions that impact consumer spending, including discretionary spending.

Declines in consumer

spending have resulted in, and could in the future result in, decreased demand for our products and services, which has adversely affected

the results of our operations in the past and may do so in the future.

and other trade barriers and restrictions and other changes to fiscal and monetary policy, higher interest rates, high unemployment,

decreased consumer confidence in the economy, armed hostilities, such as the ongoing military conflict between Russia and Ukraine and

conflict in the Middle East, foreign currency exchange rate fluctuations, conditions affecting the retail environment for products we

sell, and other matters that influence consumer spending and preferences.

In addition, consumer confidence and spending can be materially

adversely affected in response to financial market volatility, negative financial news, conditions in the real estate and mortgage markets,

including home equity loans and consumer credit, changes in net worth based on market changes and uncertainty, energy shortages and cost

increases, labor and healthcare costs, government actions and general uncertainty regarding the overall future economic environment.

may view the products we offer as discretionary items rather than necessities.

As a result, our operating results are sensitive to changes

in macroeconomic conditions that impact consumer spending, including discretionary spending.

Declines in consumer spending have resulted

in, and could in the future result in, decreased demand for our products and services, which has adversely affected the results of our

operations in the past and may do so in the future.

invest significantly in research and development, and to the extent our research and development investments are not directed efficiently

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Further, any undetected errors or defects

in third-party technologies or applications, or cybersecurity threats or attacks related to such technologies or applications, could

impair the functionality of our products and technologies, result in increased costs and injure our reputation.

Any failure of our products

and technologies to operate effectively with existing or future technologies, or any failure of a third-party cloud infrastructure partner

to support one or more of the features of our products and technologies, could cause customer dissatisfaction and reduce the demand for

our products and technologies, resulting in harm to our business.

In addition, because some of our products and technologies will be

cloud-based, we need to continually enhance and improve our products and technologies to keep pace with changes in internet-related hardware,

software, communications and database technologies and standards.

Any failure of our products and technologies to operate effectively

with future hardware or software technologies, or to comply with new industry standards, could reduce the demand for our products and

technologies and harm our business, results of operations, and financial condition.

in third-party technologies or applications, cybersecurity threats or attacks related to such technologies or applications or widespread

outages of such third-party technologies or applications, could impair the functionality of our products and technologies, result in

increased costs and injure our reputation.

Any failure of our products and technologies to operate effectively with existing or future

technologies, or any failure of a third-party cloud infrastructure partner to support one or more of the features of our products and

technologies, could cause customer dissatisfaction and reduce the demand for our products and technologies, resulting in harm to our

In addition, because some of our products and technologies will be cloud-based, we need to continually enhance and improve

our products and technologies to keep pace with changes in internet-related hardware, software, communications and database technologies

and standards.

Any failure of our products and technologies to operate effectively with future hardware or software technologies, or

to comply with new industry standards, could reduce the demand for our products and technologies and harm our business, results of operations,

and financial condition.

smart products and technologies will depend in part on access to third-party platforms or technologies, and if any such access is withdrawn,

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addition, our ability to achieve our desired revenue and profitability goals depends on how effectively and timely we execute on our

key strategic initiatives, including development and production of an enhanced Smart Sky Platform and integration of our retail operations,

and develop and implement new strategic business initiatives.

key strategic initiatives, including development and production of an enhanced Smart Sky Platform, and develop and implement new strategic

business initiatives.

Our current key strategic initiatives include the following:

launching our smart products and technologies;

launching our Smart Sky Platform;

and marketing our products and technologies to both industry and retail customers, such as real estate developers and individuals

who desire safer lighting fixtures and smart home capabilities;

who desire safer lighting fixtures and smart home capabilities, including increasing our market penetration in these sectors;

our product innovation;

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our distribution sales channels, including our retail websites;

and operating our retail websites.

operating our retail websites.

also may identify and pursue strategic acquisition candidates that would help support these initiatives, such as the 2023 acquisition

of Belami, operates a collection of online stores carrying a variety of home décor items, including lighting, and is expected

to provide us with direct distribution sales channels for our smart products and technologies.

of Belami, an e-commerce platform that carries a variety of home décor items, including lighting.

and implementing various strategic business initiatives requires us to incur additional expenses and capital expenditures and also requires

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business and operating results would be adversely affected.

we evolve our business strategy to focus on our smart products and technologies and retail websites, our results of operations, financial

condition and cash flows may be materially adversely affected.

we continue to implement our business strategy to focus on our smart products and technologies and retail websites, our results of operations,

financial condition and cash flows may be materially adversely affected.

future growth and profitability are tied in part to our ability to successfully bring to market new and innovative smart products and

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from such products and technologies may never materialize.

we fail to successfully launch our smart products and technologies or manage and maintain our evolving business strategy, our future

we fail to successfully launch and/or market our smart products and technologies or manage and maintain our business strategy, our future

revenue growth and profitability would likely be limited and our results of operations, financial condition and cash flows would likely

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may be adversely affected or terminated.

have limited financial resources, and we expect that our evolving strategy and expansion of business activities will require additional

working capital, as we anticipate we will not generate sufficient cash flows from our operations to sustain our operations or to allow

us to effectively develop our smart products and technologies or pursue our strategic initiatives.

We are currently generating revenue

primarily from the e-commerce platform that we acquired in 2023.

We expect that the release of our new smart products and technologies

will require working capital to finish product development and manufacturing, and to support market release and provide technical customer

support upon its commercial release.

have limited financial resources, and we expect that our ongoing implementation of our strategy and expansion of business activities

will require additional working capital, as we anticipate we will not generate sufficient cash flows from our operations to sustain our

operations or to allow us to effectively develop our smart products and technologies or pursue our strategic initiatives.

We are currently

generating revenue primarily from the e-commerce platform that we acquired in 2023, and to a lesser extent, increased sales of our smart

and standard plug and play technology to large retailers.

We expect that the release of additional smart products and technologies, including

the Smart Sky Platform, will require working capital to finish product development and manufacturing, and to support market release and

provide technical customer support upon its commercial release.

the future, we will need to seek additional equity or debt financing to provide for our working capital needs.

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the state of financial markets generally and other relevant factors, including high inflation and interest rates, ongoing supply

chain disruptions and shortages, labor shortages and geopolitical conditions, any disruptions to, or volatility in, the credit and

financial markets in the United States and worldwide, and a potential economic downturn or recession.

chain disruptions and shortages, labor shortages, geopolitical conditions, including the impact of tariffs and other trade barriers

or restrictions, any disruptions to, or volatility in, the credit and financial markets in the United States and worldwide, and a

potential economic downturn or recession.

of December 31, 2024, we had approximately $15.5 million in cash and cash equivalents, including restricted cash.

As we develop our

revenue base, we have raised additional funds through the sale of our common stock and warrants and issuance of debt, including

receiving approximately $20.5 million in net proceeds from our initial public offering completed in February 2022 and aggregate net

proceeds from private placements of subordinated secured convertible promissory notes and at the market offerings (sometimes

referred as “ATM”) of our common stock during 2023 of $19.6 million during 2023.

As we develop our revenue

base, we have raised additional funds through the sale of our common stock, preferred stock and warrants and issuance of debt, including

receiving aggregate net proceeds from at the market offerings (sometimes referred as “ATM”) of our common stock of $4.3 million,

and total gross proceeds of $11.0 million from the sale of two series of newly authorized preferred stock during 2024.

For additional

information regarding our financing arrangements, see the “Liquidity and Capital Resources” heading in the

“Management’s Discussion and Analysis” section of this Form 10-K.

information regarding our financing arrangements, see the “Liquidity and Capital Resources” heading in the “Management’s

Discussion and Analysis” section of this Form 10-K.

we fail to obtain required additional financing to sustain our business before we are able to produce levels of revenue to meet our financial

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electronics and mobile phone markets have experienced chronic shortages of components during periods of exceptionally high demand.

conditions have also negatively impacted the availability of certain electronic components.

While we experienced shortages in obtaining

necessary integrated circuit chips to be used in our products, we have been able to find additional suppliers for such components.

forward, we believe we can obtain more chips as needed within a reasonable time and may be able to replace difficult to acquire components

with different products or modify our design if necessary.

If we do not properly anticipate the need for or procure critical components,

we may pay higher prices for those components, our gross margins may decrease and we may be unable to meet the demands of our customers,

which could reduce our competitiveness, cause a decline in our market share and have a material adverse effect on our results of operations.

conditions, including other trade barriers or restrictions, have also negatively impacted on the availability of and/or the price of

certain electronic components.

While we experienced shortages in obtaining necessary integrated circuit chips to be used in our products,

we were able to find additional suppliers for such components.

Going forward, we believe we can obtain more chips as needed within a

reasonable time and may be able to replace difficult to acquire components with different products or modify our design if necessary.

If we do not properly anticipate the need for or procure critical components, we may pay higher prices for those components, our gross

margins may decrease and we may be unable to meet the demands of our customers, which could reduce our competitiveness, cause a decline

in our market share and have a material adverse effect on our results of operations.

rely on a limited number of third-party manufacturers to produce our products.

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our financial results could be adversely affected if we fail to successfully reduce our current or future production costs.

depend on certain key manufacturers for our current products and plan to continue to rely on such manufacturers as we transition to sales

of our smart products.

If these relationships become strained, our results of operations and financial condition could be materially

adversely affected.

We also cannot predict whether our current or future manufacturing arrangements will be able to develop efficient,

low-cost manufacturing capabilities and processes that will enable us to meet the quality, price, engineering, design and production

standards or production volumes required to successfully mass market our products.

Even if we are successful in developing manufacturing

capabilities and processes, we cannot provide any assurance that we will do so in time to meet market demand.

Our failure to develop

such manufacturing processes and capabilities, if necessary, in a timely manner could prevent us from achieving our growth and profitability

In addition, our results of operations, financial condition and cash flows could be materially adversely affected if our

third-party manufacturers were to experience problems with product quality, credit or liquidity issues, labor or materials shortages,

or disruptions or delays in their manufacturing process or delivery of the finished products and components or the raw materials used

to make such products and components.

depend on certain key manufacturers for our products.

If these relationships become strained, our results of operations and financial

condition could be materially adversely affected.

We also cannot predict whether our current or future manufacturing arrangements will

be able to develop efficient, low-cost manufacturing capabilities and processes that will enable us to meet the quality, price, engineering,

design and production standards or production volumes required to successfully mass market our products.

Even if we are successful in

developing manufacturing capabilities and processes, we cannot provide any assurance that we will do so in time to meet market demand.

Our failure to develop such manufacturing processes and capabilities, if necessary, in a timely manner could prevent us from achieving

our growth and profitability objectives.

In addition, our results of operations, financial condition and cash flows could be materially

adversely affected if our third-party manufacturers were to experience problems with product quality, credit or liquidity issues, labor

or materials shortages, or disruptions or delays in their manufacturing process or delivery of the finished products and components or

the raw materials used to make such products and components.

may also need to hire and train a significant number of employees to engage in full-scale commercial manufacturing operations.

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In particular, our product strategy relies on our ability to reduce our production costs in order to remain competitive.

As there is no historical basis for estimating the demand for our smart products and technologies, or our ability to develop, manufacture

As there is limited historical basis for estimating the demand for our smart products and technologies, or our ability to develop, manufacture

and deliver our smart products, we may be unable to accurately estimate our inventory and production requirements, which would affect

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during 2024, we had less than 10 major vendors that accounted for a majority of our cost of sales.

For additional

information regarding our suppliers, see “Item 1.

Business – Third-Party Manufacturing and Suppliers.” In addition,

lead times for materials and components may vary significantly and depend on factors such as the specific supplier, contract terms and

demand for each component at a given time.

If we are unable to successfully implement cost reduction measures, if these efforts do not

generate the level of cost savings that we expect going forward or result in higher-than-expected costs, or if we fail to order sufficient quantities of

components in a timely manner, our business, financial condition, results of operations or cash flows could be materially adversely affected.

For additional information regarding

our suppliers, see “Item 1.

Business - Third-Party Manufacturing and Suppliers.” In addition, lead times for materials and

components may vary significantly and depend on factors such as the specific supplier, contract terms and demand for each component at

a given time.

If we are unable to successfully implement cost reduction measures, if these efforts do not generate the level of cost

savings that we expect going forward or result in higher-than-expected costs, or if we fail to order sufficient quantities of components

in a timely manner, our business, financial condition, results of operations or cash flows could be materially adversely affected.

third-party manufacturers and many of our suppliers are located in China, which exposes us to additional risks.

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other trade restrictions that could have a significant impact on our revenue and profitability.

administration has imposed tariffs

on certain products imported into the United States with China as the country of origin.

While these tariffs have not had a significant

impact on the shipment of our products to international markets to date, as we are transitioning our business, we cannot predict the

impact of future tariffs on our products and technologies, and the costs of supplies and manufacturing may increase.

If we cannot deliver

our products on a competitive and timely basis, our relationships with customers will be damaged and our financial condition could also

The future imposition of, or significant increases in, the level of tariffs, custom duties, export quotas and other barriers

and restrictions by the U.S.

on China or other countries could disrupt our supply chain, increase the cost of our raw materials and therefore

our pricing, and impose the burdens of compliance with foreign trade laws, any of which could potentially affect our bottom line and

We cannot assure you that we will not be adversely affected by changes in the trade laws of foreign jurisdictions where we sell

and seek to sell our products.

administration has imposed

additional tariffs and other trade barriers and restrictions on certain products imported into the United States with China as the

country of origin.

While these tariffs have not had a significant impact on the shipment of our products to international markets to

date, as we are continuing to transition our business, we cannot predict the impact of future tariffs on our products and technologies,

and the costs of supplies and manufacturing may increase.

If we cannot deliver our products on a competitive and timely basis, our relationships

with customers will be damaged and our financial condition could also be harmed.

The future imposition of, or significant increases in,

tariffs, custom duties, export quotas and other barriers and restrictions by the U.S.

on China or other countries could disrupt our supply

chain, increase the cost of our raw materials and therefore our pricing, and impose the burdens of compliance with foreign trade laws,

any of which could potentially affect our bottom line and sales.

We cannot assure you that we will not be adversely affected by changes

in the trade laws of foreign jurisdictions where we sell and seek to sell our products.

addition, the prosecution of intellectual property infringement and trade secret theft in China is more difficult than in the United

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and greater supply chain compliance costs.

risks may include, but are not limited to, the potential impact of fluctuations in foreign currency exchange rates, the increased global

focus on environmental and social issues and China’s potential adoption of more stringent standards in these areas, other rules

and regulations adopted by the Chinese government or provincial or local governments, and the potential impact of global market and economic

conditions on the financial stability of our manufacturers.

risks may include, but are not limited to, the potential impact of fluctuations in foreign currency exchange rates, other rules and regulations

adopted by the Chinese government or provincial or local governments, and the potential impact of global market and economic conditions

on the financial stability of our manufacturers, including the impact of tariffs and other trade barriers, as well as increasing trade

tensions between the United States and China.

may acquire other businesses, license rights to technologies or products, form alliances, or dispose of assets or operations, which could

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part of our business strategy.

For instance, we acquired Belami in 2023.

We may not complete these transactions in a timely manner, on

a cost-effective basis, or at all, and if such transactions are completed, we may not realize the expected benefits.

If we are successful

in completing an acquisition, the products and technologies that are acquired may not be successful or may require significantly greater

resources and investments than originally anticipated.

We may not be able to integrate acquisitions successfully into our existing business

and could incur or assume significant debt and unknown or contingent liabilities.

In addition, we may experience diversion of our management’s

attention from our existing business and initiatives in pursuing such a strategic transaction and could also experience negative effects

on our reported results of operations from acquisition or disposition-related charges, amortization of expenses related to intangibles

and charges for impairment of long-term assets.

For instance, we acquired Belami, an e-commerce platform, in 2023.

We may not complete these transactions

in a timely manner, on a cost-effective basis, or at all, and if such transactions are completed, we may not realize the expected benefits.

If we are successful in completing an acquisition, the products and technologies that are acquired may not be successful or may require

significantly greater resources and investments than originally anticipated.

We may not be able to integrate acquisitions successfully

into our existing business and could incur or assume significant debt and unknown or contingent liabilities.

In addition, we may experience

diversion of our management’s attention from our existing business and initiatives in pursuing such a strategic transaction and

could also experience negative effects on our reported results of operations from acquisition or disposition-related charges, amortization

of expenses related to intangibles and charges for impairment of long-term assets.

addition, if we undertake acquisitions, we may issue dilutive securities, assume, or incur debt obligations, incur large one-time expenses

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income will be reduced.

are, or in the future may be, subject to substantial regulation related to quality and safety standards applicable to our products and

are, or may be in the future, subject to substantial regulation related to quality and safety standards applicable to our products and

technologies.

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we are not able to obtain liability insurance, our business, financial conditions, and results of operations could be materially adversely

may be subject to legal claims against us or claims by us that could have a significant impact on our resulting financial performance.

are, from time to time, subject to legal claims against us or claims by us that could have a significant impact on our resulting financial

any given time, we may be subject to litigation or claims related to our products and technologies, e-commerce sales, intellectual property,

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such as from natural disasters.

will rely on third parties maintaining open marketplaces to distribute our mobile application.

If such third parties interfere with the

distribution of our application, our business would be adversely affected.

will rely on third parties maintaining open marketplaces, including the Apple App Store and Google Play, to make the mobile application

controlling our products and technologies available for download.

We cannot assure you that the marketplaces through which we distribute

our mobile application will maintain their current structures or that such marketplaces will not charge us fees to list our application

for download.

We will also depend on these third-party marketplaces to enable us and our users to update our mobile application timely,

and to incorporate new features, integrations, and capabilities.

We will be subject to requirements imposed by such marketplaces, which

may change their technical requirements or policies in a manner that adversely impacts the way in which we or third parties collect,

use and share data from users through our mobile application.

If we do not comply with these requirements, we could lose access to the

mobile application marketplace and users, and our business, results of operations, and financial condition may be harmed.

rely on third parties maintaining open marketplaces to distribute our mobile application.

If such third parties interfere with the distribution

of our application, our business would be adversely affected.

rely on third parties maintaining open marketplaces, including the Apple App Store and Google Play, to make the mobile application controlling

our products and technologies available for download.

We cannot assure you that the marketplaces through which we distribute our mobile

application will maintain their current structures or that such marketplaces will not charge us fees to list our application for download.

We will also depend on these third-party marketplaces to enable us and our users to update our mobile application timely, and to incorporate

new features, integrations, and capabilities.

We will be subject to requirements imposed by such marketplaces, which may change their

technical requirements or policies in a manner that adversely impacts the way in which we or third parties collect, use and share data

from users through our mobile application.

If we do not comply with these requirements, we could lose access to the mobile application

marketplace and users, and our business, results of operations, and financial condition may be harmed.

addition, Apple, and Google, among others, for competitive or other reasons, could stop allowing or supporting access to our mobile application

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and results of operations.

Changes to tax laws or exposure to additional

tax liabilities may have a negative impact on our operating results.

to tax laws or exposure to additional tax liabilities may have a negative impact on our operating results.

developments in U.S.

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or officer to the extent provided by Florida law.

Our second amended and restated bylaws (the “bylaws”) also contain provisions

Our third amended and restated bylaws (the “bylaws”) also contain provisions

regarding indemnification of our directors, officers and employees, including, under certain circumstances, against attorneys’

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by our stockholders against our directors and officers even though such actions, if successful, might otherwise benefit us and stockholders.

factors could have a material adverse effect on our future profitability and financial condition.

factors could have a materially adverse effect on our future profitability and financial condition.

other factors can affect our profitability and financial condition, including:

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labor disputes, strikes, slow-downs or other forms of labor or union activity;

increased tariffs or other trade barriers or restrictions;

and pressure from third-party interest groups;

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from evolving business strategies, changing product mix, changes in tax rates and opportunities existing now or in the future;

related to our information technology systems, any of which could adversely affect business operations, including any significant

breakdown, invasion, destruction, or interruption of these systems;

related to our information technology systems, or outages of third-party information technologies or software upon which we rely,

any of which could adversely affect business operations, including any significant breakdown, invasion, destruction, or interruption

of these systems;

in credit markets impacting our ability to obtain financing for our business operations;

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Act that required the SEC to adopt additional rules and regulations in these areas, such as “say on pay” and proxy access.

Stockholder activism, the current political and economic environment and the high levels of government intervention and regulatory reform

may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the way

we operate our business in ways we cannot currently anticipate.

rules and regulations applicable to public companies substantially increase our legal and financial compliance costs and make some activities

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addition, there has been increased focus from regulatory authorities, investors and other stakeholders on companies’ environmental,

social and governance (“ESG”) policies and practices, including corporate citizenship and sustainability.

Public interest

and legislative pressure related to public companies’ ESG practices continues to grow;

for example, the SEC has adopted rules requiring

climate-related disclosures and included in its regulatory agenda potential rulemaking on corporate diversity.

Furthermore, there exists

certain “anti-ESG” sentiment among some individuals and governments, and several states have enacted or proposed “anti-ESG”

policies or legislation, which may conflict with other laws and regulations.

Compliance with ESG-related rules and regulations could

increase compliance burdens and associated regulatory costs, as well as enhance the risk of claims and regulatory actions, which could

adversely impact our reputation and our efforts to raise capital, including as a result of public regulatory sanctions.

social and governance policies and practices.

Public interest and legislative pressure related to public companies’ environmental,

social and governance practices continues to grow;

for example, California has adopted certain climate-related disclosure requirements.

At the same time, there exists anti-environmental, social and governance, including anti-diversity and equity, sentiment among some stakeholders

and government institutions, and anti-environmental, social and governance policies or legislation enacted by the U.S.

federal government

or states may conflict with other laws and regulations applicable to us.

Compliance with inconsistent environmental, social and governance-related

rules and regulations, including those related to climate change, could increase compliance burdens and associated regulatory costs,

as well as enhance the risk of claims and regulatory actions, which could adversely impact our reputation and our efforts to raise capital,

including as a result of public regulatory sanctions.

future success depends on our ability to retain key employees and to attract, retain and motivate qualified personnel.

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market and economic conditions may have serious adverse consequences on our business, financial condition, and stock price.

financial markets have recently experienced, because of, among other factors, geopolitical conditions, increasing inflation and interest

rates, currency exchange rates, labor shortages and supply chain disruptions and constraints, and have in the past experienced, extreme

volatility and disruptions, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty

about economic stability.

There can be no assurance that further deterioration in credit and financial markets and confidence in economic

conditions will not occur.

In addition, inflationary factors, such as increases in interest rates, government regulations, supply and

overhead costs and transportation costs, may adversely affect our operating results, and we may not be able to offset increased costs

with increased sales price per unit, particularly as we work toward commercial manufacturing of our products.

Our general business strategy

and ability to raise capital may be adversely affected by any economic downturn or recession, volatile business environment or continued

unpredictable and unstable market conditions.

Deterioration in the equity and credit markets may make any necessary debt or equity financing

more difficult, more costly, and more dilutive.

Failure to secure any necessary financing in a timely manner and on favorable terms could

have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon

our strategic plans.

In addition, there is a risk that one or more of our current service providers and other partners could go out of

business, including as a result of difficult economic conditions, which could directly affect our ability to attain our operating goals

on schedule and on budget.

recent years, global financial markets have experienced extreme volatility and disruptions, because of, among other factors, geopolitical

conditions, including increased tariffs and other trade barriers and restrictions, high inflation and interest rates, fluctuating currency

exchange rates, labor shortages and supply chain disruptions and constraints, declines in economic growth, increases in unemployment

rates and uncertainty about economic stability.

There can be no assurance that further deterioration in credit and financial markets

and confidence in economic conditions will not occur.

In addition, inflationary factors, such as increases in interest rates, government

regulations, and increases in tariffs and other supply and overhead costs and transportation costs, may adversely affect our operating

results, and we may not be able to offset increased costs with increased sales price per unit, particularly as we continue to work toward

commercial manufacturing of our products.

Our general business strategy and ability to raise capital may be adversely affected by any

economic downturn or recession, volatile business environment or continued unpredictable and unstable market conditions.

Deterioration

in the equity and credit markets may make any necessary debt or equity financing more difficult, more costly, and more dilutive.

to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy,

financial performance and stock price and could require us to delay or abandon our strategic plans.

In addition, there is a risk that

one or more of our current service providers and other partners could go out of business, including as a result of difficult economic

conditions, which could directly affect our ability to attain our operating goals on schedule and on budget.

addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market

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of December 31, 2024, our cash and cash equivalents were approximately $15.5 million, including restricted cash.

While we are not aware of any downgrades, material

losses, or other significant deterioration in the fair value of our cash equivalents or investments since December 31, 2023, no assurance

can be given that further deterioration of the global credit and financial markets would not negatively impact our current portfolio

of cash equivalents or our ability to meet our financing objectives.

For instance, in March 2023, the FDIC took control and was appointed

receiver of Silicon Valley Bank and New York Signature Bank.

While the Company did not have any direct exposure to these banks, if other

banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the

banking system and financial markets, our operations may be negatively impacted, including any inability on our part, or on our customers’

parts, to access cash, cash equivalents or investments.

Furthermore, our stock price has declined, and may decline in the future, as

a result of the volatility of the stock market and any general economic downturn.

in Israel, including Israel-Hamas war, may adversely affect our operations, which could negatively impact our revenues and cash flows.

While we are not aware

of any downgrades, material losses, or other significant deterioration in the fair value of our cash and cash equivalents since December

31, 2024 , no assurance can be given that further deterioration of the global credit and financial markets would not negatively

impact our current portfolio of cash equivalents or our ability to meet our financing objectives.

For instance, in March 2023, the FDIC

took control and was appointed receiver of Silicon Valley Bank and New York Signature Bank.

While the Company did not have any direct

exposure to these banks, if other banks and financial institutions enter receivership or become insolvent in the future in response to

financial conditions affecting the banking system and financial markets, our operations may be negatively impacted, including any inability

on our part, or on our customers’ parts, to access cash, cash equivalents or investments.

Furthermore, our stock price has declined,

and may decline in the future, as a result of the volatility of the stock market and any general economic downturn.

in Israel, including conflicts in the Middle East, may adversely affect our operations, which could negatively impact our revenues and

a number of our individuals working on the development of our product offerings located in Israel, our business and operations are directly

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October 2023, Israel declared war against Hamas.

The intensity and duration of Israel’s current war against Hamas is difficult

to predict, as are such war’s economic implications on the Company’s business and operations and on Israel’s economy

In addition, clashes between Israel and Hezbollah in Lebanon have increased.

These conflicts, as well as actions that could

be taken in the future by NATO, the United States, the United Kingdom, the European Union or Israel’s neighboring states and other

countries, have created global security concerns that may result in a greater or lasting regional conflict.

To date, our operations have

not been adversely affected by this situation.

However, the individuals working on developing and improving our product offerings are

not only within the range of rockets from the Gaza Strip, but also within the range of rockets that can be fired from Lebanon, Syria

or elsewhere in the Middle East.

If hostile action or hostilities otherwise disrupt our Israeli operations, our ability to improve timely

our product offerings could be materially and adversely affected.

In addition, several hundred thousand Israeli reservists were drafted

to perform immediate military service.

If individuals working on improving our product offerings are called for service in the current

war with Hamas, we expect such persons would be absent for an extended period.

As a result, our operations may be disrupted by such absences,

which could materially and adversely affect our business and results of operations.

In addition, shifting economic and political conditions

in the United States and in other countries may result in changes in how the United States and other countries conduct business and other

relations with Israel, which may have an adverse impact on our Israeli operations and our business.

Although there is currently a ceasefire in place, tensions are still heightened and

it is difficult to predict whether the conflict may reignite.

Should the Israel-Hamas war resume, the war’s economic implications

on the Company’s business and operations and on Israel’s economy in general is difficult to predict.

In addition, clashes

between Israel and Hezbollah in Lebanon have increased.

These conflicts, as well as actions that could be taken in the future by NATO,

the United States, the United Kingdom, the European Union or Israel’s neighboring states and other countries, have created global

security concerns that may result in a greater or lasting regional conflict.

To date, our operations have not been adversely affected

by this situation.

However, the individuals working on developing and improving our product offerings are not only within the range of

rockets from the Gaza Strip, but also within the range of rockets that can be fired from Lebanon, Syria, Iran or elsewhere in the Middle

If hostile action or hostilities otherwise disrupt our Israeli operations, our ability to improve timely our product offerings

could be materially and adversely affected.

In addition, several hundred thousand Israeli reservists were drafted to perform immediate

military service.

If individuals working on improving our product offerings are called for service in the current war with Hamas, we

expect such persons would be absent for an extended period.

As a result, our operations may be disrupted by such absences, which could

materially and adversely affect our business and results of operations.

In addition, shifting economic and political conditions in the

United States and in other countries may result in changes in how the United States and other countries conduct business and other relations

with Israel, which may have an adverse impact on our Israeli operations and our business.

internal computer systems, or those of our third-party manufacturers or other contractors or consultants, may fail or suffer security

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and replacement.

We rely on these systems generally to manage day-to-day operations, manage relationships with our customers and

maintain our research and development data and our financial and accounting records.

Despite our implementation of security

measures, our internal computer systems, and those of our third-party manufacturers, information technology suppliers and other

contractors, vendors and consultants upon which we rely, experience from time to time, and are vulnerable to damage from computer

viruses, criminal cyberattacks, security incidents due to employee or service provider error, insider attacks, natural disasters,

terrorism, war, telecommunication and electrical failures, phishing or denial-of-service attacks, ransomware or other malware,

social engineering, malfeasance, other unauthorized physical or electronic access, or other vulnerabilities.

The failure of our

information technology systems, our inability to successfully maintain, enhance and/or replace our information technology systems as

needed, or any compromise of the integrity or security of the data we generate from our information technology systems could have a

material adverse effect on our results of operations, disrupt our business and product and technology development and make us

unable, or severely limit our ability, to respond to customer demands.

Any interruption of our information technology systems could

result in decreased revenue, increased expenses, increased capital expenditures, customer dissatisfaction and potential lawsuits,

any of which could have a material adverse effect on our results of operations, financial condition, and cash flows.

We rely on these systems generally to manage day-to-day operations, manage relationships with our customers and maintain

our research and development data and our financial and accounting records.

Despite our implementation of security measures, our internal

computer systems, and those of our third-party manufacturers, information technology suppliers and other contractors, vendors and consultants

upon which we rely, experience from time to time, and are vulnerable to damage from, computer viruses and/or malicious or destructive

code, criminal cyberattacks, security incidents due to employee or service provider error, insider attacks, natural disasters, terrorism,

war, telecommunication and electrical failures, phishing or denial-of-service attacks, ransomware or other malware, social engineering,

malfeasance, other unauthorized physical or electronic access, or other vulnerabilities.

The failure of our information technology systems,

our inability to successfully maintain, enhance and/or replace our information technology systems as needed, or any compromise of the

integrity or security of the data we generate from our information technology systems could have a material adverse effect on our results

of operations, disrupt our business and product and technology development and make us unable, or severely limit our ability, to respond

to customer demands.

Any interruption of our information technology systems could result in decreased revenue, increased expenses, increased

capital expenditures, customer dissatisfaction and potential lawsuits, any of which could have a material adverse effect on our results

of operations, financial condition, and cash flows.

We could also be adversely impacted by cybersecurity incidents that occur at third

parties that lead to widespread technology outages, interruptions or other failures of operational, communication or other systems globally

and across companies and industries.

information technology systems involve the storage of our confidential information and trade secrets, as well as our customers’

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adequate preventative measures, and future cyberattacks could go undetected and persist for an extended period of time.

to the extent artificial intelligence capabilities improve and are increasingly adopted, they may be used to identify vulnerabilities

and craft increasingly sophisticated cybersecurity attacks, and vulnerabilities may be introduced from the use of artificial intelligence

by us, our financial services providers and other vendors and third-party providers.

Further, the risk of a security breach or disruption,

particularly through cyberattacks or cyber intrusion, including by computer hackers, foreign governments, and cyber terrorists, has generally

increased as cyberattacks have become more prevalent and harder to detect and fight against.

In addition, hardware, software or applications

we procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly compromise network

and data security.

Any breach or failure of our information technology systems could result in decreased revenue, increased expenses,

increased capital expenditures, customer dissatisfaction and potential lawsuits, any of which could have a material adverse effect on

our results of operations, financial condition and cash flows.

to the extent artificial intelligence capabilities continue to improve and are increasingly adopted, they may be used to identify vulnerabilities

and craft increasingly sophisticated cybersecurity attacks, including the use of generative artificial intelligence to conduct more sophisticated

social engineering attacks on the Company, suppliers or customers., and In addition, vulnerabilities may be introduced from the use of

artificial intelligence by us, our financial services providers and other vendors and third-party providers.

Further, the risk of a security

breach or disruption, particularly through cyberattacks or cyber intrusion, including by computer hackers, foreign governments, and cyber

terrorists, has generally increased as cyberattacks have become more prevalent and harder to detect and fight against.

In addition, hardware,

software or applications we procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly

compromise network and data security or trigger a widespread outage.

Any breach or failure of our information technology systems could

result in decreased revenue, increased expenses, increased capital expenditures, customer dissatisfaction and potential lawsuits, any

of which could have a material adverse effect on our results of operations, financial condition and cash flows.

consultants, vendors and others to whom we entrust confidential data, and on whom we rely to provide products and services, face similar

threats and growing requirements.

We depend on such parties to implement adequate controls and safeguards to protect against and report

cyber incidents.

If such parties fail to deter, detect, or report cyber incidents in a timely manner, we may suffer from financial and

other harm, including to our information, operations, performance, employees, and reputation.

Because we do not control our vendors or service providers and our ability to monitor their cybersecurity

is limited, we cannot ensure the cybersecurity measures they take will be sufficient to protect any information we share with them or

prevent any disruption arising from a technology failure, cyberattack or other information or security breach.

We depend on such parties

to implement adequate controls and safeguards to protect against and report cyber incidents.

If such parties fail to deter, detect, or

report cyber incidents in a timely manner, we may suffer from financial and other harm, including to our information, operations, performance,

employees, and reputation.

we are unable to prevent or mitigate the impact of security or data privacy breaches, we could be exposed to litigation and governmental

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from using our smart products and technologies.

have begun to incorporate artificial intelligence capabilities in our product offerings, which may present operational and reputational

are in the early stages of incorporating artificial intelligence (sometimes referred to as “AI”) capabilities into certain

product offerings.

These features may become important in our operations over time.

Our competitors or other third parties may incorporate

AI into their products more quickly or more successfully than us, which could impair our ability to compete effectively and adversely

affect our results of operations.

Additionally, if the content, analyses, or recommendations that AI applications assist in producing

are or are alleged to be deficient, inaccurate, or biased, we could be subject to competitive risks, potential legal liability, and reputational

harm, and our business, financial condition and results of operations may be adversely affected.

The use of AI capabilities may also

result in cybersecurity incidents, and any such cybersecurity incidents related to our use of AI capabilities could adversely affect

our business.

Furthermore, the legal and regulatory landscape surrounding AI technologies is rapidly evolving and uncertain, and compliance

with new or changing laws, regulations or industry standards relating to AI may impose significant operational costs and may limit our

ability to use AI technologies in our products.

There can be no assurance that the measures we have taken to mitigate the potential risks

related to the use of AI technologies in our products will be sufficient.

Failure to appropriately respond to this evolving landscape

may result in legal liability, regulatory action or brand and reputational harm.

or accidental actions or inactions by employees or other third parties with authorized access to our networks may result in the exposure

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Services (“AWS”).

Customers of our cloud-based solutions need to be able to access our platform at any time, without

interruption or degradation of performance, and, in some cases, we need to provide them with service-level commitments with respect

Our cloud-based solutions depend on protecting the virtual cloud infrastructure hosted by third-party hosting services by

maintaining its configuration, architecture, features and interconnection specifications, as well as the information stored in these

virtual data centers, which is transmitted by third-party internet service providers.

Any limitation on the capacity of our

third-party hosting services could impede our ability to onboard new customers or expand the usage of our existing customers, which

could adversely affect our business, financial condition, revenues, results of operations or cash flows.

In addition, any incident

affecting our third-party hosting services’ infrastructure that may be caused by cyberattacks, natural disasters, such as

fires, floods, severe storms, or earthquakes, power loss, telecommunications failures, terrorist or other attacks, public health

crises and other similar events beyond our control could negatively affect our cloud-based solutions.

A prolonged service disruption

affecting our cloud-based solution for any of the foregoing reasons would negatively impact our ability to serve our customers and

could damage our reputation with current and potential customers, expose us to liability, cause us to lose customers or otherwise

harm our business.

We may also incur significant costs for using alternative equipment or taking other actions in preparation for,

or in reaction to, events that damage the third-party hosting services we use.

Customers of our cloud-based solutions need to be able to access our platform at any time, without interruption

or degradation of performance, and, in some cases, we need to provide them with service-level commitments with respect to uptime.

cloud-based solutions depend on protecting the virtual cloud infrastructure hosted by third-party hosting services by maintaining its

configuration, architecture, features and interconnection specifications, as well as the information stored in these virtual data centers,

which is transmitted by third-party internet service providers.

Any limitation on the capacity of our third-party hosting services could

impede our ability to onboard new customers or expand the usage of our existing customers, which could adversely affect our business,

financial condition, revenues, results of operations or cash flows.

In addition, any incident affecting our third-party hosting services’

infrastructure that may be caused by cyberattacks, natural disasters, such as fires, floods, severe storms, or earthquakes, power loss,

telecommunications failures, terrorist or other attacks, public health crises and other similar events beyond our control could negatively

affect our cloud-based solutions.

A prolonged service disruption affecting our cloud-based solution for any of the foregoing reasons

would negatively impact our ability to serve our customers and could damage our reputation with current and potential customers, expose

us to liability, cause us to lose customers or otherwise harm our business.

We may also incur significant costs for using alternative

equipment or taking other actions in preparation for, or in reaction to, events that damage the third-party hosting services we use.

provides the cloud computing infrastructure that we use to host our platform, manage data, mobile application and many of the internal

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decrease and we could be exposed to a risk of loss, litigation and regulatory proceedings.

also incur costs in order to comply with cybersecurity or data privacy regulations or with requirements imposed by business

Data privacy and cybersecurity laws in the United States and internationally are constantly changing, and the

implementation of these laws has become more complex.

These laws often develop in ways we cannot predict and may materially increase

our cost of doing business, particularly as we expand the nature and types of products and technologies we offer.

These laws may

impose stringent data protection requirements and provide for penalties for noncompliance.

To comply with current or newly enacted

laws, we may be subject to increased costs as a result of continually evaluating and modifying our policies and processes and

adapting to new requirements that are or become applicable to us.

For instance, many jurisdictions have enacted laws requiring

companies to notify individuals of data security breaches involving their personal data.

These mandatory disclosures regarding a

security breach often lead to widespread negative publicity, which may cause our customers to lose confidence in the effectiveness of

our data security measures.

also incur costs in order to comply with cybersecurity or data privacy regulations or with requirements imposed by business partners.

Data privacy and cybersecurity laws in the United States and internationally are constantly changing, and the implementation of these

laws has become more complex.

These laws often develop in ways we cannot predict and may materially increase our cost of doing business,

particularly as we expand the nature and types of products and technologies we offer.

These laws may impose stringent data protection

requirements and provide for penalties for noncompliance.

To comply with current or newly enacted laws, we may be subject to increased

costs as a result of continually evaluating and modifying our policies and processes and adapting to new requirements that are or become

applicable to us.

For instance, many jurisdictions have enacted laws requiring companies to notify individuals of data security breaches

involving their personal data.

These mandatory disclosures regarding a security breach often lead to widespread negative publicity, which

may cause our customers to lose confidence in the effectiveness of our data security measures.

our compliance efforts, we may fail to achieve compliance with applicable privacy or data protection laws and regulations as they evolve,

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public health crises, geopolitical conditions, acts or threats of war or terrorism, international conflicts, such as the Russia-Ukraine

war and Israel-Hamas war, power outages, fires, explosions, equipment failures, sabotage, political instability and the actions taken

by governments could cause damage to or disrupt our business operations, or those of our manufacturers or our customers, and could create

economic instability.

Disruptions to our information technology infrastructure from system failures, shutdowns, power outages, telecommunication

or utility failures, and other events, including disruptions at third party information technology and other service providers, could

also interfere with or disrupt our operations.

Although it is not possible to predict such events or their consequences, these events

could increase our costs, result in physical damage to or destruction or disruption of properties used in connection with the manufacture

of our products, the lack of an adequate workforce in part or all of our operations, supply chain disruptions and data, utility and communications

In addition, these events could indirectly result in increases in the costs of our insurance if they result in significant

loss of property or other insurable damage.

Furthermore, the insurance we maintain may not be adequate to cover our losses resulting

from any business interruption, including those resulting from a natural disaster or other severe weather event, and recurring extreme

weather events or other adverse events could reduce the availability or increase the cost of insurance.

Any of these developments could

have a material and adverse effect on our business, financial condition, and results of operations.

may be exposed to certain regulatory and financial risks related to climate change.

concerns about climate change may result in the imposition of new regulations or restrictions to which we may become subject.

of governments or governmental bodies have introduced or are contemplating regulatory changes in response to climate change.

the SEC recently adopted new disclosure requirements relating to climate change.

In addition, California recently passed a series of

climate disclosure bills, which may lead to other states proposing climate-related regulations that require additional climate-related

The outcome of new legislation or regulation in the U.S.

and other jurisdictions in which we operate may result in new or

additional requirements, fees, or restrictions on certain activities for us our manufacturers, our suppliers, or our customers.

with these climate change initiatives may also result in additional costs to us, including, among other things, increased production

costs, additional taxes, and reduced emission allowances or additional restrictions on production or operations, as well as increased

indirect costs resulting from our manufacturers, suppliers or customers that get passed on to us.

Any adopted future climate change regulations

could also negatively impact our ability to compete with companies situated in areas not subject to such limitations.

We may not be able

to recover the cost of compliance with new or more stringent laws and regulations, which could adversely affect our results of operations,

cash flow or financial condition.

war and conflict in the Middle East, power outages, fires, explosions, equipment failures, sabotage, political instability and the actions

taken by governments could cause damage to or disrupt our business operations, or those of our manufacturers or our customers, and could

create economic instability.

Disruptions to our information technology infrastructure from system failures, shutdowns, power outages,

telecommunication or utility failures, and other events, including disruptions at third party information technology and other service

providers, could also interfere with or disrupt our operations.

Although it is not possible to predict such events or their consequences,

these events could increase our costs, result in physical damage to or destruction or disruption of properties used in connection with

the manufacture of our products, the lack of an adequate workforce in part or all of our operations, supply chain disruptions and data,

utility and communications disruptions.

In addition, these events could indirectly result in increases in the costs of our insurance

if they result in significant loss of property or other insurable damage.

Furthermore, the insurance we maintain may not be adequate

to cover our losses resulting from any business interruption, including those resulting from a natural disaster or other severe weather

event, and recurring extreme weather events or other adverse events could reduce the availability or increase the cost of insurance.

Any of these developments could have a material and adverse effect on our business, financial condition, and results of operations.

are implementing a new enterprise resource planning system.

Our failure to implement it successfully, on time and on budget could have

a material adverse effect on us.

are in the process of implementing a new enterprise resource planning (“ERP”) system.

ERP implementations are complex, time-consuming,

and involve substantial expenditures on system software and implementation activities.

The ERP system will be critical to our ability

to provide important information to our management, obtain and deliver products, provide services and customer support, send invoices

and track payments, fulfill contractual obligations, accurately maintain books and records, provide accurate, timely and reliable reports

on our financial and operating results, and otherwise operate our business.

implementations also require transformation of business and financial processes in order to reap the benefits of the ERP system.

such implementation involves risks inherent in the conversion to a new computer system, including loss of information and potential disruption

to our normal operations.

The implementation and maintenance of the new ERP system has required, and will continue to require, the investment

of significant financial and human resources and the implementation may be subject to delays and cost overruns.

In addition, we may not

be able to successfully complete the implementation of the new ERP system without experiencing difficulties.

Any disruptions, delays

or deficiencies in the design and implementation or the ongoing maintenance of the new ERP system could adversely affect our ability

to process orders, provide services and customer support, send invoices and track payments, fulfill contractual obligations, accurately

maintain books and records, provide accurate, timely and reliable reports on our financial and operating results, including reports required

by the SEC, and otherwise operate our business.

New system implementations across the enterprise, such as the current implementation

of our new ERP system, which includes a cloud-based solution, also pose risks of outages or disruptions, which could affect our suppliers,

operations, and customers.

Issues faced by us or our third-party “cloud” computing providers, including technological or business-related

disruptions or prolonged third-party service outages, as well as cybersecurity threats, could adversely impact our business, results

of operations and financial condition for future periods.

Additionally,

if we do not effectively implement the ERP system as planned or the system does not operate as intended, the effectiveness of our internal

control over financial reporting could be adversely affected or our ability to assess it adequately could be delayed, which could cause

us to incur significant additional expenses, damage our reputation, and have a material adverse effect on us.

Related to Our Common Stock

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ability to successfully launch, and gain market acceptance of, our smart products and technologies;

reliance on product distribution arrangements with third parties;

or disputes concerning patent applications, issued patents or other proprietary rights;

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from our business, which could significantly harm our profitability and reputation.

conversion of outstanding convertible notes or exercise of outstanding warrants into shares of common stock could materially dilute our

stockholders.

of March 21, 2024, we had $1.1 million and $10.35 million aggregate principal amount of convertible notes outstanding, convertible

into shares of our common stock at $15.00 and $2,70 per share, respectively, and warrants to purchase 2,063,522 shares of our common

stock outstanding at an exercise price ranging from $2,70 to $18.00 per share.

The conversion price of the notes or exercise price

of the warrants may be less than the market price of our common stock at the time of conversion or exercise and may be subject to

future adjustment due to certain events, including our issuance of common stock or common stock equivalents at an effective price

per share lower than the conversion rate or exercise rate then in effect.

If the entire principal amount of all the outstanding

convertible notes is converted into shares of common stock, we would be required to issue an aggregate of no less than approximately

3,916,671 shares of common stock.

If all the outstanding warrants are exercised for shares of common stock, we would be required to

issue an aggregate of 2,063,522 shares of common stock.

If we issue any or all of these shares, the ownership of our stockholders

will be diluted.

conversion of outstanding convertible notes or preferred stock or exercise of outstanding warrants into shares of common stock could

materially dilute our stockholders.

of March 13, 2025, we had $15.6 million aggregate principal amount of convertible notes outstanding, convertible into shares of our

common stock at a conversion price ranging from $2.70 to $15.00 per share;

200,000 shares of Series A Preferred Stock, no par value (“Series

A Preferred Stock”) outstanding, which has an original issue price of $25.00 per share and is convertible into shares of common

stock at a conversion price of $2.00 per share;

260,000 shares of Series A-1 Preferred Stock, no par value (“Series A-1 Preferred

Stock”) outstanding, which has an original issue price of $25.00 per share and is convertible into shares of common stock at a

conversion price of $2.00 per share;

and warrants to purchase 1,523,667 shares of our common stock outstanding at a n exercise price

ranging from $2.70 to $18.00 per share.

The effective conversion price of the notes or preferred stock or exercise price of the warrants

may be less than the market price of our common stock at the time of conversion or exercise and may be subject to future adjustment due

to certain events, including our issuance of common stock or common stock equivalents at an effective price per share lower than the

conversion rate or exercise rate then in effect.

If the entire principal amount of all the outstanding convertible notes is converted

into shares of common stock, we would be required to issue an aggregate of no less than approximately 6,063,890 shares of common stock.

If all the outstanding warrants are exercised for shares of common stock, we would be required to issue an aggregate of 1,523,667 shares

of common stock.

If all of the Series A Preferred Stock and Series A-1 Preferred Stock outstanding are converted into shares of common

stock, we would be required to issue an aggregate of 2,500,000 and 3,250,000 shares of common stock, respectively.

If we issue any or

all of these shares, the ownership of our stockholders will be diluted.

securities analysts do not publish research or reports about our business, or if they publish negative evaluations of our stock, the

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your ability to influence corporate matters and could delay or prevent a change in corporate control.

executive officers, directors, 5% holders and their affiliates beneficially own, in the aggregate, approximately 39% of our outstanding

common stock, as of March 21, 2024.

As a result, these stockholders, if they act together, will be able to influence our management and

affairs and the outcome of matters submitted to our stockholders for approval, including the election of directors and any merger, consolidation

or sale of all or substantially all of our assets.

These stockholders may have interests, with respect to their common stock, that are

different from those of other investors, and the concentration of voting power among these stockholders may have an adverse effect on

the price of our common stock.

In addition, this concentration of ownership might adversely affect the market price of our common stock

In addition, our outstanding convertible

preferred stock has voting rights, which reduce the relative voting power of holders of our common stock.

executive officers, directors, 5% holders of our common stock and their affiliates beneficially own, in the aggregate, approximately

30.1% of our outstanding common stock, or 30.3% of our total voting power, as of March 13, 2025.

In addition, holders of our Series

A Preferred Stock and Series A-1 Preferred Stock, which includes certain of our officers, are entitled to vote, on an as-converted basis,

together with holders of our common stock on all matters submitted to a vote of the holders of our common stock.

As a result, the issuance

of such preferred stock effectively reduced the relative voting power of the holders of our common stock.

The holders of such preferred

stock have approximately 5.2% of the Company’s total voting power, including both common stock and such preferred stock, as of

March 13, 2025.

stockholders, if they act together, will be able to influence our management and affairs and the outcome of matters submitted to our

stockholders for approval, including the election of directors and any merger, consolidation or sale of all or substantially all of our

These stockholders may have interests that are different from those of other investors, and the concentration of voting power

among these stockholders may have an adverse effect on the price of our common stock.

In addition, this concentration of ownership might

adversely affect the market price of our common stock by:

deferring, or preventing a change of control of us;

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and economic conditions may negatively impact on our business, financial condition and share price.

over inflation, high interest rates, energy costs, geopolitical issues, the U.S.

mortgage market and a declining real estate market,

unstable global credit markets and financial conditions, and labor and supply shortages have led to periods of significant economic instability,

diminished liquidity and credit availability, declines in consumer confidence and discretionary spending, diminished expectations for

the global economy and expectations of slower global economic growth going forward, increased unemployment rates, and increased credit

defaults in recent years.

Our general business strategy may be adversely affected by any such economic downturns or recessions, volatile

business environments and continued unstable or unpredictable economic and market conditions.

If these conditions continue to deteriorate

or do not improve, it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive.

to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy,

financial performance, and share price and could require us to delay or abandon development or commercialization plans.

over inflation, high interest rates, tariffs and other trade barriers and restrictions, energy costs, geopolitical issues, the U.S.

market and a declining real estate market, unstable global credit markets and financial conditions, and labor and supply shortages have

led to periods of significant economic instability, diminished liquidity and credit availability, declines in consumer confidence and

discretionary spending, diminished expectations for the global economy and expectations of slower global economic growth going forward,

increased unemployment rates, and increased credit defaults in recent years.

Our general business strategy may be adversely affected

by any such economic downturns or recessions, volatile business environments and continued unstable or unpredictable economic and market

If these conditions continue to deteriorate or do not improve, it may make any necessary debt or equity financing more difficult

to complete, more costly, and more dilutive.

Failure to secure any necessary financing in a timely manner and on favorable terms could

have a material adverse effect on our growth strategy, financial performance, and share price and could require us to delay or abandon

development or commercialization plans.

we do not anticipate paying any cash dividends on our common stock in the foreseeable future, capital appreciation, if any, will be your

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We currently anticipate that we will retain all of our future earnings,

if any, to support operations and to finance the growth and development of our business.

As a result, capital appreciation, if any, of

our common stock will be the sole source of gain for our stockholders in the foreseeable future.

if any, to support operations, including to pay dividends on our outstanding preferred stock and interest on our outstanding debt, and

to finance the growth and development of our business.

As a result, capital appreciation, if any, of our common stock will be the sole

source of gain for our stockholders in the foreseeable future.

Anti-takeover

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

What changed 10-K

Item 1A. Risk Factors