What changed in this filing

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Item 1A. Risk Factors

2026-03-31 compared with 2025-03-12 · 862 added, 361 removed, 464 unchanged (72% of the section changed)

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degree of risk.

You should consider carefully the risks and uncertainties described below and all information contained in this Report,

You should carefully consider the risks and uncertainties described below and all information contained in this Report,

before you decide whether to purchase our securities.

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condition, results of operations and prospects would likely suffer, possibly materially.

In addition, the trading price of our common

stock could decline due to any of these risks or uncertainties, and you may lose part or all of your investment.

These disclosures reflect our beliefs and opinions

as to factors that could materially and adversely affect us and our securities in the future.

References to past events are provided by

way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred

in the past or their likelihood of occurring in the future.

In addition, the trading price of our common stock could decline due to any

of these risks or uncertainties, and you may lose part or all of your investment.

Risks Relating to Our Business

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for management, may damage our operations and financial results and cause our stock price to decline.

We depend, to a significant degree, on the skills, experience and efforts

of our management team, and other personnel, particularly in the management of our subsidiary PeriShip Global.

Our failure to attract,

integrate, motivate and retain existing or additional personnel in a timely fashion, and develop successors with commensurate skills and

talents, could disrupt or otherwise harm our operations and financial results.

The loss of services of certain of our management team

and key employees, an inability to attract or retain qualified personnel in the future could delay the development of and negatively impact

the operations and profitability of our business.

We depend, to a significant degree, on the skills,

experience and efforts of our management team, and other personnel, particularly in the management of our subsidiary PeriShip Global.

Our failure to attract, integrate, motivate, and retain existing or additional personnel in a timely fashion, and develop successors with

commensurate skills and talents, could disrupt or otherwise harm our operations and financial results.

The loss of services of certain

of our management team and key employees, or an inability to attract or retain qualified personnel in the future, could delay the development

of and negatively impact the operations and profitability of our business.

Our future growth will depend upon the success of our Precision

Logistics segment and future businesses we may acquire.

If we fail to effectively execute our strategy, our competitive position and financial

performance could be materially harmed.

Our future growth will depend upon the success of our Precision Logistics

segment and future businesses we may acquire.

We are currently engaged in efforts to find and acquire businesses, which is intended to

streamline operations, improve profitability and improve our overall competitiveness.

The successful execution of our strategy is subject

to significant uncertainties and may require additional capital and operational expenditures.

If we fail to execute our strategy effectively,

our ability to realize the intended benefits may be compromised.

Even if we successfully implement our strategy, we may not see the intended

results, diminishing the expected improvements to efficiency or revenue generation.

This could materially and adversely affect our competitive

position, financial performance, and brand reputation.

Our Precision Logistics segment relies on one key strategic partner

Logistics segment.

If we fail to effectively execute our strategy, our competitive position and financial performance could be materially

Our future growth will depend upon the success

of our Precision Logistics segment and future businesses we may acquire.

We are currently engaged in efforts to streamline operations,

improve profitability, and improve our overall competitiveness.

The successful execution of our strategy is subject to significant uncertainties

and may require additional capital and operational expenditures.

If we fail to execute our strategy effectively, our ability to realize

the intended benefits may be compromised.

Even if we successfully implement our strategy, we may not see the intended results, diminishing

the expected improvements to efficiency or revenue generation.

This could materially and adversely affect our competitive position, financial

performance, and brand reputation.

Our Precision Logistics segment relies on our Strategic Partner

for shipping services for our customers and as a source for customers representing a substantial percentage of our revenues.

is dependent, and we believe that it will continue to depend on our relationship with one strategic partner.

PeriShip Global partners

with one major global carrier for all its customers’ shipping needs.

While we work closely with this key strategic partner and have

transportation services and pricing agreements in place covering the shipping services they provide to our customers, such agreements

are subject to termination or modification from time to time.

If our strategic partner is unwilling or unable to supply to us the shipping

services we market and sell on acceptable terms, or at all, or otherwise elects to terminate its business relationship with us, we may

not be able to obtain alternative shipping services from other providers on acceptable terms, in a timely manner, or at all, and our business

may be materially and adversely impacted.

We do not currently have any alternative shipping service suppliers from which we can obtain

the shipping services we currently receive from our strategic partner.

Establishing the necessary information technology infrastructure

and business relationship with another shipping services provider would be costly and time consuming and may ultimately not be successful

or cost-effective.

Further, any increase in the prices charged by our single strategic partner or failure to perform by our strategic

partner could cause our costs to increase or could cause us to experience short-term unavailability of shipping services on which our

business relies.

In particular,

delays and other shipping disruptions at our strategic partner significantly negatively impact our business.

Our business involves the

shipment of time and temperature sensitive goods, so our customers are significantly negatively impacted by delays and other shipping

disruptions that cause product loss, spoilage and reputational harm.

An increase in delays and other shipping disruptions on the part

of our strategic partner could cause our clients to seek shipping solutions from our competitors who use alternative shipping service

If these events occur, it may reduce our profitability or may cause us to increase our prices.

In addition, any material interruptions

in shipping services by this strategic partner may result in significant cost increases and reduce sales, which could harm our business,

financial condition and results of operations and may have a material adverse impact on our business.

to relying on this strategic partner for shipping services, a material portion of our revenue has been generated through a service agreement

pursuant to which this strategic partner resells our services to its customers under a “white label” arrangement, which we

refer to as a Premium Service.

Under this arrangement we provide our logistics services to our strategic partner’s customers in

exchange for a pre-negotiated service fee per shipment.

Sales through our strategic partner accounted for approximately 16% of revenue

of our Precision Logistics segment for the year ended December 31, 2024, and 17% for the year ended December 31, 2023.

Our strategic partner

has begun to provide its own service offerings to its customers, and we expect revenue from our Premium Services in our Precision Logistics

segment will begin to decrease as we experience a reduction in business for these services.

If we fail to offset a reduction in business

for our Premium Services in our Precision Logistics segment through our ProActive Services or other service offerings, our business, financial

condition and results of operations could be materially adversely affected.

Global partners with our Strategic Partner, a major global carrier, for its customers’ shipping needs.

Our business is dependent,

and we believe that it will continue to depend on our relationship with our Strategic Partner.

On August 26, 2025, our prior carrier

partner notified providers, including PeriShip Global, that it would be providing preferred shipping services internally and that the

providers would no longer be approved preferred shippers effective September 24, 2025.

As such, PeriShip Global is no longer a preferred

shipper with our prior carrier partner and our Precision Logistics segment ceased providing ProActive services to our prior carrier partner’s

customers in September 2025.

We continued to provide Premium services to our prior carrier partner until we ceased providing Premium

services in February 2026.

While we no longer provide ProActive and Premium services to our prior carrier partner we can and continue

to provide Direct Premium services to our customers who use our prior carrier partner for their shipping needs.

On September 24, 2025, we began

offering ProActive services to customers of our new Strategic Partner.

W e are currently establishing

the ability to offer our Premium services to our Strategic Partner.

We expect to begin broadly offering Premium and Direct Premium services

to customers of our new Strategic Partner in the second quarter of 2026.

While we work closely with our

Strategic Partner and have transportation services and pricing agreements in place covering the shipping services they provide to our

customers, such agreements are subject to termination or modification from time to time.

If our Strategic Partner is unwilling or unable

to supply to us the shipping services we market and sell on acceptable terms, or at all, or otherwise elects to terminate its business

relationship with us, we may not be able to obtain alternative shipping services from other providers on acceptable terms, in a timely

manner, or at all, and our business may be materially and adversely impacted.

We do not currently have any alternative shipping service

suppliers from which we can obtain the shipping services we currently receive from our Strategic Partner.

In addition, establishing the

necessary information technology infrastructure and business relationship with our Strategic Partner, or with other shipping and carrier

services providers, may be costly and time consuming and may ultimately not be successful or cost-effective.

Further, any increase in

the prices charged by our Strategic Partner or failure to perform by our Strategic Partner could cause our costs to increase or could

cause us to experience short-term unavailability of shipping services on which our business relies.

In particular, delays and other

shipping disruptions at our Strategic Partner may have a significantly negative impact our business.

Our business involves the shipment

of time and temperature sensitive goods, so our customers are significantly negatively impacted by delays and other shipping disruptions

that cause product loss, spoilage, and reputational harm.

An increase in delays and other shipping disruptions on the part of our Strategic

Partner could cause our clients to seek shipping solutions from our competitors who use alternative shipping service providers.

events occur, it may reduce our profitability or may cause us to increase our prices.

In addition, any material interruptions in shipping

services by this Strategic Partner may result in significant cost increases and reduce sales, which could harm our business, financial

condition and results of operations and may have a material adverse impact on our business.

of the change from our prior carrier partner to our Strategic Partner through which we provide our ProActive services, it is likely that

our revenues from ProActive services will materially decline in the quarters ended March 31, 2026 and June 30, 2026 as compared to the

quarters ended March 31, 2025 and June 30 2025.

We expect our ProActive services revenues to substantially recover during 2026 as we transition

additional customers and increase our existing and new customer bases however, there can be no assurance that our ProActive service

revenue will return to historical levels .

In addition, a material portion of our gross margin

has been generated from our prior carrier partner reselling our Premium services to its customers.

Our prior carrier partner is no longer

reselling these services to its customers.

We are now directly selling these services to legacy customers of our prior carrier partner

and we are working to establish the ability to offer these services to customers of our Strategic Partner.

Premium services accounted

for approximately 19% of revenue of our Precision Logistics segment for each of the years ended December 31, 2025, and 2024, respectively.

Our prior carrier partner provides its own service offering to its customers that competes with our Premium services, and we expect revenue

related to our prior carrier partner will decrease over time as it competes with us for these customers.

Our goal is to offset these decreases

by offering Premium services associated with our Strategic Partner.

If we fail to offset any reduction in business in our Precision Logistics

segment through our Premium services or ProActive Services, our business, financial condition and results of operations could be materially

adversely affected.

Our business is subject to seasonal trends.

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affected by factors that are outside of our control.

There can be no assurance that our historic operating patterns will continue in future

periods as we cannot influence or forecast many of these factors.

In addition, as a result of the change from

our prior carrier partner to our Strategic Partner through which we provide our ProActive services, it is likely that our revenues from

ProActive services will materially decline in the quarters ended March 31, 2026 and June 2026 as compared to the quarters ended March

31, 2025 and June 2025.

There can be no assurance that our historic operating patterns will continue in future periods as we cannot

influence or forecast many of these factors.

Severe climate conditions and other catastrophic events can have

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competitive, cyclical, and is expected to remain so for the foreseeable future.

We face competition in all geographic markets and each industry sector in which we operate.

We have and may face continued

competition by strategic partners.

Many of these competitors have significantly more resources and are actively pursuing acquisition opportunities

and are developing new technologies to gain competitive advantages.

We face competition in all geographic markets and each

industry sector in which we operate.

We have and may face continued competition by strategic partners.

Many of these competitors have

significantly more resources and are actively pursuing acquisition opportunities and are developing new technologies to gain competitive

The primary competitive factors are price and quality of service.

Increased competition or our inability to compete successfully may lead to a reduction in our volume, reduced revenues, reduced profit

margins, increased pricing pressure, or a loss of customer relationships, any one of which could affect our business and financial results.

Numerous competitive factors could impair our ability to maintain our current profitability, including the following:

Increased competition or our inability to compete successfully

may lead to a reduction in our volume, reduced revenues, reduced profit margins, increased pricing pressure, or a loss of customer relationships,

any one of which could affect our business and financial results.

Numerous competitive factors could impair our ability to maintain our

current profitability, including the following:

· our competitors may periodically reduce their prices to gain business, especially during times of weak

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· our inability to achieve expected customer retention levels or sales growth targets;

· we compete with many other transportation and logistics service providers, which has included and may include our strategic partners, some of which have greater capital resources

or lower cost structures than us;

· we compete with many other transportation and logistics service providers, which has included and may

include our strategic partners, some of which have greater capital resources or lower cost structures than us;

· our strategic partners may take steps to position their own product offerings as a replacement or competitor

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Our future growth will depend upon the success

of our strategic partners who integrate our solutions into their product offerings .

We rely on strategic partnerships with one large logistics carrier

for our Precision Logistics segment and larger companies which integrate our technologies into their product offerings for our legacy

Authentication segment.

These strategies leave us largely dependent upon the success of our partners.

If any of our strategic partners

who include our technology in their products cease to do so, or we fail to obtain other partners who will incorporate, embed, integrate

or bundle our technology, or these partners are unsuccessful in their efforts, expanding deployment of our technology, our business and

future growth would be materially and adversely affected.

of our Strategic Partner to integrate our solutions into their service offerings and our ability to continue to provide Direct Premium

services to legacy customers of our prior carrier.

Our Precision Logistics segment relies on the

integration of our ProActive and Premium services solutions into our Strategic Partner’s service offerings to its customers.

also rely on the ability to continue to provide Direct Premium services to our customers who use our prior carrier partner for their shipping

These strategies leave us largely dependent upon the success of our Strategic Partner and prior carrier partner and their

policies related to the use of our services in connection with their shipping services.

If our Strategic Partner or prior carrier partner

cease to do so, or we fail to obtain other partners who will incorporate, embed, integrate, or bundle our technology, or these logistics

carriers are unsuccessful in their efforts, expanding deployment of our technology, our business and future growth would be materially

and adversely affected.

Damage to our brand image and corporate reputation could materially

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other intangible assets, and future impairment of these assets could have a material adverse impact on the Company's financial results.

the date of this Report, the Company has recorded significant goodwill and other identifiable intangible assets on its balance sheet as

a result of its acquisition of the PeriShip Global business in 2022.

A number of factors may result in impairments to goodwill and other

intangible assets, including significant negative industry or economic trends, disruptions to our business, increased competition and

significant changes in the use of the assets.

charges could adversely affect the Company's financial condition or results of operations in the periods recognized.

As of the date of

this Report, the Company has recorded significant goodwill and other identifiable intangible assets on its balance sheet as a result of

its acquisition of the PeriShip Global business in 2022.

As a result of a long-lived asset and goodwill asset impairment assessment

performed in September 2025, an intangible asset impairment charge of $2,788 thousand and a goodwill impairment charge of $1,062 thousand

was recorded for the year ended December 31, 2025 relating to the Precision Logistics segment.

An intangible asset impairment charge of

$964 thousand and a goodwill impairment charge of $1,351 thousand was recorded for the year ended December 31, 2024 relating to Authentication

A number of factors may result in future impairments to our remaining goodwill and other intangible

assets, including significant negative industry or economic trends, disruptions to our business, increased competition, and significant

changes in the use of the assets.

Impairment charges could adversely

affect the Company's financial condition or results of operations in the periods recognized.

Our customers’ businesses may be negatively

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For example, inflation

and uncertainty and instability in the global economy and geopolitical events may lead to fewer goods being transported.

Many of the products

our clients ship are luxury or discretionary products and the demand for such products may decrease in adverse economic times.

when adverse economic times arise, customers may select competitors that offer lower rates or choose to ship their goods without logistical

support in an attempt to lower their costs.

In addition, changes in the United States’ or international trade policy, including

tariffs, export controls, quotas, embargoes, or sanctions, could trigger additional retaliatory actions by affected countries, resulting

in “trade wars” and further increased costs for goods transported globally, which may negatively impact our customers.

and other economic factors such as recessions could have an adverse effect on our business, financial conditions and results of operations

and we might be forced to lower our rates or lose customers.

and uncertainty and instability in the global economy and geopolitical events such as a war in Iran and unrest in areas of the world that

are dependent upon fuel production can negatively affect transportation costs and further reduce consumer spending leading to fewer goods

being transported globally.

Many of the products our clients ship are luxury or discretionary products and the demand for such products

may decrease in adverse economic times.

Further, when adverse economic times arise, customers may select competitors that offer lower

rates or choose to ship their goods without logistical support in an attempt to lower their costs.

In addition, changes in the United

States’ or international trade policy, including tariffs, export controls, quotas, embargoes, or sanctions, could trigger additional

retaliatory actions by affected countries, resulting in “trade wars” and further increased costs for goods transported globally,

which may negatively impact our customers.

These and other economic factors such as recessions could have an adverse effect on our business,

financial conditions and results of operations and we might be forced to lower our rates or lose customers.

Overall economic conditions that reduce

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demand some carriers have implemented strategies to address a potential global recession.

In April 2023, the major carrier that PeriShip

Global partners with laid out steps it was taking to slash $4 billion in permanent costs by the end of its 2025 fiscal year in response

to these market conditions and lower demand.

In June 2023, the major carrier stated that due to ongoing demand its plans to ground 29

more aircraft in its fiscal year that started in June 2024.

In mid-December 2024 the carrier forecasted flat revenue year over year for

We have seen a softening in demand for some services

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Global supply-chain delays and shortages, which

are out of our control, are currently affecting a wide variety of businesses globally including one of our customers.

Supply-chain delays

shortages may affect our customers or potential customers which would adversely affect our operations.

We have a history

of losses and we may never achieve or maintain profitability .

Since our inception,

we have incurred operating losses each year due to costs incurred in connection with research and development activities and general and

administrative expenses associated with our operations.

In addition, we have made significant expenditures on acquisitions and may continue

to complete acquisitions in the future.

We expect to continue to incur expenditures to develop and market our services and to make acquisitions

and could continue to incur operating losses and negative operating cash flow.

We may encounter unforeseen expenses, difficulties, complications,

delays and other unknown factors that may adversely affect our business.

Our ability to generate profits will depend, in part, on our

expenses and our ability to generate revenue.

Our prior losses and any future losses have had and may continue to have an adverse effect

on our working capital.

If we fail to generate revenue and become profitable, or if we are unable to fund our continuing losses, our shareholders

could lose all or part of their investments.

Our ability to

use our net operating losses to offset future taxable income may be subject to certain limitations.

Our net operating loss

carryforwards ("NOLs"), and certain other tax attributes could be unavailable to offset future income tax liabilities because

of restrictions under U.S.

Under the Tax Cuts and Jobs Act, or the TCJA, federal NOLs generated in tax years ending after December

31, 2017, may be carried forward indefinitely.

are out of our control, can affect a wide variety of businesses globally including our customers.

Supply-chain delays shortages may affect

our customers or potential customers which would adversely affect our operations.

We have a history of losses and we may never

achieve or maintain profitability .

Since our inception, we have incurred operating

losses each year due to costs incurred in connection with research and development activities and general and administrative expenses

associated with our operations.

In addition, we have made significant expenditures on acquisitions.

We expect to continue to incur expenditures

to market our services and could continue to incur operating losses and negative operating cash flow.

We may encounter unforeseen expenses,

difficulties, complications, delays, and other unknown factors that may adversely affect our business.

Our ability to generate profits

will depend, in part, on our expenses and our ability to generate revenue.

Our prior losses and any future losses have had and may continue

to have an adverse effect on our working capital.

If we fail to generate revenue and become profitable, or if we are unable to fund our

continuing losses, our stockholders could lose all or part of their investments.

Our ability to use our net operating losses

to offset future taxable income may be subject to certain limitations.

Our net operating loss carryforwards ("NOLs"),

and certain other tax attributes could be unavailable to offset future income tax liabilities because of restrictions under U.S.

Under the Tax Cuts and Jobs Act, or the TCJA, federal NOLs generated in tax years ending after December 31, 2017, may be carried forward

indefinitely.

The carryforwards are limited to 80% of each subsequent year's net income.

In addition, Sections

382 and 383 of the Internal Revenue Code (“IRC”), contain rules that limit the ability of a corporation that undergoes an

"ownership change" (generally, any change in ownership of more than 50% of the corporation's stock over a three-year period)

to utilize its pre-change NOLs and tax credit carryforwards to offset future taxable income.

These rules generally operate by focusing

on ownership changes involving stockholders owning directly or indirectly 5% or more of the stock of a corporation and any change in ownership

arising from a new issuance of stock by the company.

Generally, if an ownership change occurs, the yearly taxable income limitation on

the use of NOLs and tax credit carryforwards and certain built-in losses is equal to the product of the applicable long-term, tax-exempt

rate and the value of the corporation's stock immediately before the ownership change.

The Company completed an IRC Section 382 analysis

in 2022 and determined that an ownership change occurred sufficient to impose additional limitations on the use of NOL carryforwards.

The Company has not completed an IRC Section 382 analysis in 2023 or 2024.

In the event future ownership changes are determined, we might

be unable to offset our taxable income with losses, or our tax liability with credits, before such losses and credits expire, in which

event we could incur larger federal and state income tax liabilities than we would have had we not experienced an ownership change.

In addition, Sections 382 and 383 of the Internal

Revenue Code (“IRC”), contain rules that limit the ability of a corporation that undergoes an "ownership change"

(generally, any change in ownership of more than 50% of the corporation's stock over a three-year period) to utilize its pre-change NOLs

and tax credit carryforwards to offset future taxable income.

These rules generally operate by focusing on ownership changes involving

stockholders directly or indirectly owning 5% or more of the stock of a corporation and any change in ownership arising from a new issuance

of stock by the company.

Generally, if an ownership change occurs, the yearly taxable income limitation on the use of NOLs and tax credit

carryforwards and certain built-in losses is equal to the product of the applicable long-term, tax-exempt rate and the value of the corporation's

stock immediately before the ownership change.

The Company completed an IRC Section 382 analysis in 2022 and determined that an ownership

change occurred sufficient to impose additional limitations on the use of NOL carryforwards.

The Company has not completed an IRC Section

382 analysis in 2023, 2024 or 2025.

In the event future ownership changes are determined, we might be unable to offset our taxable income

with losses, or our tax liability with credits, before such losses and credits expire, in which event we could incur larger federal and

state income tax liabilities than we would have had we not experienced an ownership change.

In connection with the Merger Agreement and

Merger, we are analyzing whether that potential transaction, combined with other stock ownership changes, could trigger an ownership change

pursuant to IRS Section 382.

If an ownership change is found as a result of the Merger pursuant to IRS Section 382, the amount of our

NOLs we can carryforward each year could be limited or eliminated.

Because our name and brand could be confused

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our business.

If our technologies

do not work as anticipated once we achieve meaningful sales, we will not be successful .

Our business depends

on our ability to market and sell our technology.

Without material sales and acceptance from customers with respect to our technologies,

we will not be successful.

We can provide no assurances that the market will accept our products or that we will achieve any meaningful

If our technology

cannot be used successfully to proactively provide analytics logistics management, we may not be able to generate material revenue .

Our proprietary technology

is the core of our PeriShip Global operations.

If our technologies do not work as anticipated

once we achieve meaningful sales, we will not be successful .

Our business depends on our ability to market

and sell our technology.

Without material sales and acceptance from customers with respect to our technologies, we will not be successful.

We can provide no assurances that the market will accept our products or that we will achieve any meaningful sales.

If our technology cannot be used successfully

to proactively provide analytics logistics management, we may not be able to generate material revenue .

Our proprietary technology is the core of our

PeriShip Global operations.

The failure of our technology will result in the stoppage of our operation.

fact our business is the monitoring of time sensitive goods movement, any stoppage will result in the financial loss and service liability

In order to stay competitive, we need to ensure the continuity and the timeliness of our service, it is essential that the technology

platform has redundancy built in, high performing and scalable.

We may not continue to invest in our Authentication segment operations

and as a result, we may not be able to complete the development and commercialization of our Authentication segment products.

Given our planned use of capital, we may not have the ability to fund

and invest in the development and commercialization of our Authentication segment.

If we do not invest in our Authentication segment,

we may have to significantly delay, scale back or discontinue our operations and the development or commercialization of our Authentication

Segment, which could harm our results of operations.

Our Authentication segment has historically

targeted large companies and, their internal policies and resistance to change may impair our ability to successfully commercialize our

Authentication segment.

Our ability to become successful and generate

positive cash flow within our Authentication segment will be dependent upon the extent of commercialization of products using our technology.

Commercialization of new technology products often has a very long lead time.

This problem is exacerbated when customers are large entities.

Our current and target customers are large entities.

These factors may adversely affect our ability to commercialize our Authentication

technologies.

Further, we cannot assure you that commercialization will result in profitability.

We will need to expand our sales, marketing

and support organizations and our distribution arrangements to increase market acceptance of our products and services .

We currently have a limited number of sales, marketing,

customer service and support personnel and may need to increase our staff, or further outsource our sales process, to generate a greater

volume of sales and to support any new customers or the expanding needs of existing customers.

The employment market for sales, marketing,

customer service and support personnel in our industry is very competitive, and we may not be able to hire the kind and number of sales,

marketing, customer service and support personnel we are targeting.

Our inability to hire or outsource qualified sales, marketing, customer

service and support personnel may harm our business, operating results and financial condition.

We may not be able to sufficiently build

out our distribution network or enter into arrangements with qualified sales personnel on acceptable terms or at all.

If we are not able

to develop greater distribution capacity, we may not be able to generate sufficient revenue to continue our operations.

Due to the fact our business is

the monitoring of time sensitive goods movement, any stoppage will result in the financial loss and service liability damage.

to stay competitive, we need to ensure the continuity and the timeliness of our service, it is essential that the technology platform

has redundancy built in, high performing and scalable.

We are not currently expanding our sales,

marketing and support organizations and our distribution arrangements, which will limit our ability to increase market acceptance of our

products and services .

We are not currently expanding our sales, marketing

and support organizations or our distribution arrangements which will limit our ability to increase market acceptance of our products

and services.

We will continue to evaluate the appropriate use of our sales and marketing strategies and may choose to expand our sales,

marketing and support organizations or our distribution arrangements in the future, which may require us to increase our staff, or further

outsource our sales process, to generate a greater volume of sales and to support any new customers or the expanding needs of existing

The employment market for sales, marketing, customer service, and support personnel in our industry is very competitive, and

we may not be able to hire the kind and number of sales, marketing, customer service and support personnel we are targeting.

Our inability

to hire or outsource qualified sales, marketing, customer service and support personnel may harm our business, operating results, and

financial condition.

We may not be able to sufficiently build out our distribution network or enter into arrangements with qualified sales

personnel on acceptable terms or at all.

If we are not able to develop greater distribution capacity, we may not be able to generate sufficient

revenue to continue our operations.

If we fail to protect or enforce our intellectual

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of our proprietary information or deter independent development of similar technologies by others.

As management deems appropriate,

we will pursue the registration of our domain names, trademarks, and service marks in the U.S.

As management deems appropriate, we may pursue

the registration of our domain names, trademarks, and service marks in the U.S.

and in certain locations outside the U.S.

We will seek to protect our trademarks, patents and domain names in an increasing number of jurisdictions, a process that is expensive

and time-consuming and may not be successful or which we may not pursue in every location.

It may be expensive and cost prohibitive to

file patents worldwide and we may be financially required to file patents in select countries where we see the greatest potential for

our technologies.

We may, over time, increase our investment in protecting our innovations through increased patent filings that are expensive

and time-consuming and may not result in issued patents that can be effectively enforced.

The terms of our

patents may not be sufficient to effectively protect our business.

In most countries in

which we file patent applications, including the U.S., the term of an issued patent is twenty years from the earliest claimed filing date

of a non-provisional patent application in the applicable country.

With respect to any issued patents in the U.S., we may be entitled

to obtain a patent term extension or extend the patent expiration date provided we meet the applicable requirements for obtaining such

patent term extensions.

Although such extensions may be available, the life of a patent and the protection it affords is by definition

In addition, the rights granted under any issued patents may not provide us with protection or competitive advantages against

competitors with similar technology.

Furthermore, our competitors may independently develop similar technologies.

For these reasons, we

may have competition for our technologies.

Upon the expiration of our issued patents, we will not be able to assert such patent rights

against potential competitors and our business and results of operations may be adversely affected.

If we are required

to sue third parties who we allege are violating our intellectual property rights, or if we are sued for violating a third party’s

patents or other intellectual property rights, we may incur substantial expenses, and we could incur substantial damages, including amounts

we cannot afford to pay .

Litigation may be necessary

to enforce our intellectual property rights, protect our trade secrets or determine the validity and scope of proprietary rights claimed

Patent and intellectual property litigation is extremely expensive and beyond our ability to pay.

While third parties

do, under certain circumstances, finance litigation for companies that file suit, we cannot assure you that we could find a third party

to finance any claim we choose to pursue.

Moreover, third parties frequently refuse to finance companies that are sued.

litigation of this nature, regardless of outcome or merit, could result in substantial costs, adverse publicity or diversion of management

and technical resources, any of which could adversely affect our business and operating results.

If we fail to maintain, protect and enforce

our intellectual property rights, our business and operating results may be harmed.

to protect our trademarks, patents, and domain names in an increasing number of jurisdictions, a process that is expensive and time-consuming

and may not be successful or which we may not pursue in every location.

It may be expensive and cost prohibitive to file patents worldwide

and we may be financially required to file patents in select countries where we see the greatest potential for our technologies.

over time, increase our investment in protecting our innovations through increased patent filings that are expensive and time-consuming

and may not result in issued patents that can be effectively enforced.

If we are required to sue third parties

who we allege are violating our intellectual property rights, or if we are sued for violating a third party’s patents or other intellectual

property rights, we may incur substantial expenses, and we could incur substantial damages, including amounts we cannot afford to pay .

Litigation may be necessary to enforce our intellectual

property rights, protect our trade secrets or determine the validity and scope of proprietary rights claimed by others.

Patent and intellectual

property litigation is extremely expensive and beyond our ability to pay.

While third parties do, under certain circumstances, finance

litigation for companies that file suit, we cannot assure you that we could find a third party to finance any claim we choose to pursue.

third parties frequently refuse to finance companies that are sued.

Any litigation of this nature, regardless of outcome or merit,

could result in substantial costs, adverse publicity or diversion of management and technical resources, any of which could adversely

affect our business and operating results.

If we fail to maintain, protect and enforce our intellectual property rights, our business

and operating results may be harmed.

From time-to-time, we may face allegations that

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financial officers.

In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal control

over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related

costs and significant management oversight.

To maintain and improve the effectiveness of our disclosure controls and procedures and internal control over financial

reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related costs

and significant management oversight.

Our management concluded that our disclosure controls

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Any failure to implement and maintain effective internal control

over financial reporting also could adversely affect the results of periodic management evaluations and annual independent registered

over financial reporting could also adversely affect the results of periodic management evaluations and annual independent registered

public accounting firm attestation reports regarding the effectiveness of our internal control over financial reporting that we will eventually

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to these trends, which may lead to significant ongoing software development costs and capital investments in information technology infrastructure.

We may be unable to accurately determine the needs of our customers and integrate cohesively with our key strategic partner, and identify

the trends in the transportation services industry, in a timely and cost-effective manner, which could result in decreased demand for

our services and a corresponding decrease in our revenues.

Despite testing, external and internal risks, such as malware, insecure coding,

“Acts of God,” data leakage and human error pose a direct threat to our information technology systems and operations.

may also be subject to cybersecurity attacks and other intentional hacking.

Any failure to identify and address such defects or errors

or prevent a cyber-attack could result in service interruptions, operational difficulties, loss of revenues or market share, liability

to customers or others, diversion of resources, injury to our reputation and increased service and maintenance costs.

Addressing such

issues could prove to be impossible or very costly and responding to resulting claims or liability could similarly involve substantial

We must maintain and enhance the reliability and speed of our information technology systems to remain competitive and effectively

handle higher volumes of shipments.

If our information technology systems are unable to manage additional volume for our operations as

our business grows, or if such systems are not suited to manage the various service modes we offer or businesses we acquire, our service

levels and operating efficiency could decline.

If we fail to hire and retain qualified personnel to implement, protect and maintain our

information technology systems or if we fail to upgrade our systems to meet our customers’ and strategic operating partners’

demands, our business and results of operations could be seriously harmed.

This could result in a loss of customers or a decline in the

volume of shipments we receive from customers.

We may be unable to accurately determine the needs of our customers and integrate our technology and services cohesively with our key

Strategic Partner, our prior carrier partner, or other logistic carriers, or identify the trends in the transportation services industry,

in a timely and cost-effective manner, which could result in decreased demand for our services and a corresponding decrease in our revenues.

Despite testing, external and internal risks, such as malware, insecure coding, “Acts of God,” data leakage and human error

pose a direct threat to our information technology systems and operations.

We may also be subject to cybersecurity attacks and other intentional

Any failure to identify and address such defects or errors or prevent a cyber-attack could result in service interruptions, operational

difficulties, loss of revenues or market share, liability to customers or others, diversion of resources, injury to our reputation and

increased service and maintenance costs.

Addressing such issues could prove to be impossible or very costly and responding to resulting

claims or liability could similarly involve substantial cost.

We must maintain and enhance the reliability and speed of our information

technology systems to remain competitive and effectively handle higher volumes of shipments.

If our information technology systems are

unable to manage additional volume for our operations as our business grows, or if such systems are not suited to manage the various service

modes we offer or businesses we acquire, our service levels and operating efficiency could decline.

If we fail to hire and retain qualified

personnel to implement, protect and maintain our information technology systems or if we fail to upgrade our systems to meet our customers’

and strategic operating partners’ demands, our business and results of operations could be seriously harmed.

This could result in

a loss of customers or a decline in the volume of shipments we receive from customers.

Our information technology systems also depend

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Fluctuations in labor costs, changes in

the availability of key suppliers, or catastrophic events may increase the cost of our products and services.

the availability of transportation service, or catastrophic events may increase the cost of our products and services.

Increases in labor costs might be difficult to

pass on to our customers.

In our Authentication segment security pigments, and ink canisters are key elements in the cost of our products.

Our inability to offset material price inflation could adversely affect our results of operations.

We rely on one global carrier for transportation

services, one supplier to procure our raw materials, one strategic partner to produce our ink canisters, and it is difficult to predict

what effects shortages or price increases for the raw materials we use to make our products may have in the future.

Our ability to manage

inventory and meet delivery requirements may be constrained by our supplier’s inability to scale production and adjust delivery

during times of volatile demand.

Our inability to fill our supply needs would jeopardize our ability to fulfill obligations under current

contracts or enter new contracts to sell our products, which would, in turn, result in reduced sales and profits, contract penalties or

terminations, and damage to customer relationships.

We rely on our Strategic Partner, and for certain legacy customers our prior carrier partner, for transportation

Our ability to meet delivery requirements may be constrained by our Strategic Partner’s and prior carrier partner’s

inability to adjust delivery during times of volatile demand.

Our inability to fill the needs of our customers regardless of whether they

use our Strategic Partner, our prior carrier partner, or another logistic carrier for their shipping needs would jeopardize our ability

to fulfill obligations under current contracts or enter new contracts to sell our products, which would, in turn, result in reduced sales

and profits, contract penalties or terminations, and damage to customer relationships.

Our ability to become profitable is largely

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Our ability to become profitable depends upon

a number of factors, including our ability to (i) identify and evolve with emerging technological and broader industry trends, (ii) develop

and maintain competitive products, (iii) defend our market share against an ever-expanding number of competitors including many new and

non-traditional competitors, (iv) enhance our products by adding innovative features that differentiate our products from those of our

competitors and prevent commoditization of our products, (v) develop, manufacture and bring compelling new products to market quickly

and cost-effectively, (vi) monitor disruptive technologies and business models, (vii) achieve sufficient return on investment for new

products introduced based on capital expenditures and research and development spending, (viii) respond to changes in overall trends related

to end market demand, (ix) leverage our strategic partnerships to develop and commercialize new and existing products and (x) attract,

develop and retain individuals with the requisite skill, expertise and understanding of customers’ needs to develop new technologies

and introduce new products and sell our current products.

The failure of our technologies or products to gain market acceptance due to

more attractive offerings by our competitors or the failure to address any of the above factors could significantly reduce our revenues

and adversely affect our competitive standing and prospects.

The expenses or losses associated with lack

of widespread market acceptance of our solutions may harm our business, operating results and financial condition .

Rapid technological changes and frequent new

product introductions are typical in the markets we serve.

Our future success will depend in part on continuous, timely development and

introduction of new products that address evolving market requirements.

To the extent we fail to introduce new and innovative products,

we may lose any market share we have to our competitors, which may be difficult or impossible to regain.

Any inability, for technological

or other reasons, to successfully develop and introduce new products could harm our business.

Additionally, we may experience delays

in the development and introduction of products, we may be unable to keep pace with the rapid rate of change in anti-counterfeiting and

security products’ research, and any new products acquired or developed by us may not meet the requirements of the marketplace

or achieve market acceptance.

If we are unable to develop new products to meet market demands, our business could be materially adversely

a number of factors, including our ability to (i) identify and evolve with emerging technological and broader logistics industry trends,

(ii) develop and maintain competitive technologies, (iii) defend our market share against an ever-expanding number of competitors including

many new and non-traditional competitors, (iv) enhance our technologies by adding innovative features that differentiate our technologies

from those of our competitors and prevent commoditization of our technologies (v) monitor disruptive technologies and business models,

(vi) respond to changes in overall trends related to end market demand, (vii) leverage our current and any future strategic partnerships

to commercialize existing technologies and (viii) attract, develop and retain individuals with the requisite skill, expertise and understanding

of customers’ needs to sell our current technologies.

The failure of our technologies to gain market acceptance due to more attractive

offerings by our competitors or the failure to address any of the above factors could significantly reduce our revenues and adversely

affect our competitive standing and prospects.

Risks Relating to our Common Stock

Upon exercise of our outstanding

options or warrants, conversion of our Series B Convertible Preferred Stock, conversion of our Convertible debt, and vesting of our

restricted stock units, we will be obligated to issue a substantial

number of additional shares of common stock which will dilute our present shareholders .

We are obligated to issue additional shares of our common stock in

connection with our outstanding options, warrants and shares of our Series B Convertible Preferred Stock.

For the years ended December

31, 2024, there were approximately 7,971,000 anti-dilutive shares consisting 1,606,000 unvested performance restricted stock units, 414,000

restricted stock units and restricted stock awards, 221,000 shares issuable upon exercise of stock options, 4,629,000 shares issuable

upon exercise of warrants, 957,000 shares issuable upon conversion of convertible debt, and 144,000 shares issuable upon conversion of

preferred stock.

The exercise, conversion or exchange of warrants or convertible securities, including for other securities, will cause

us to issue additional shares of our common stock and will dilute the percentage ownership of our shareholders.

In addition, we have in

the past, and may in the future, exchange outstanding securities for other securities on terms that are dilutive to the securities held

by other shareholders not participating in such exchange.

Upon exercise of our outstanding warrants,

conversion of our Series B Convertible Preferred Stock, conversion of our Convertible debt, and vesting of our restricted stock units,

we will be obligated to issue a substantial number of additional shares of common stock which will dilute our present stockholders .

We are obligated to issue additional shares of

our common stock in connection with our outstanding warrants and shares of our Series B Convertible Preferred Stock.

For the year ended

December 31, 2025, there were approximately 3,976,000 anti-dilutive shares consisting 1,322,000 unvested performance restricted stock

units, 303,000 restricted stock units and restricted stock awards, 1,555,000 shares issuable upon exercise of warrants, 652,000 shares

issuable upon conversion of convertible debt, and 144,000 shares issuable upon conversion of preferred stock.

The exercise, conversion

or exchange of warrants or convertible securities, including for other securities, will cause us to issue additional shares of our common

stock and will dilute the percentage ownership of our stockholders.

In addition, we have in the past, and may in the future, exchange

outstanding securities for other securities on terms that are dilutive to the securities held by other stockholders not participating

in such exchange.

Offers or availability for sale of a substantial

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future at a time and price that we deem reasonable or appropriate.

If our existing shareholders and investors seek to sell a substantial

If our existing stockholders and investors seek to sell a substantial

number of shares of our common stock, such selling efforts may cause significant declines in the market price of our common stock.

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Because we may issue preferred stock without

the approval of our shareholders and have other anti-takeover defenses, it may be more difficult for a third party to acquire us and could

the approval of our stockholders and have other anti-takeover defenses, it may be more difficult for a third party to acquire us and could

depress our stock price .

In general, our Board of Directors may issue,

without a vote of our shareholders, one or more additional series of preferred stock that have more than one vote per share, although

without a vote of our stockholders, one or more additional series of preferred stock that have more than one vote per share, although

the Company’s ability to designate and issue preferred stock is currently restricted by covenants under our agreements with prior

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in both a drop in our stock price and a decline in interest of our common stock.

This could make it more difficult for shareholders to

This could make it more difficult for stockholders to

sell their common stock.

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is performing well.

Because we do not intend to pay cash dividends

on our shares of common stock, any returns will be limited to the value of our shares .

We currently anticipate that we will retain future

earnings for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for

the foreseeable future.

Any return to shareholders will therefore be limited to the increase, if any, of our share price.

Because we have not historically paid cash

dividends on our shares of common stock, any returns will be limited to the value of our shares .

We have never declared or paid a cash dividend.

Pursuant to the Merger Agreement, we may, but have no obligation to, declare, set aside, and pay on or after the closing date of the Merger

a cash dividend to holders of our capital stock insomuch as any dividend does not make us unable to comply with the closing net cash requirement

set forth in the Merger Agreement.

We cannot be certain what our cash balance will be at the closing of the Merger and whether there will

be any amount above the closing net cash requirement set forth in the Merger Agreement available to be issued as a dividend.

dividend can be declared, our Board of Directors has no obligation and is not required to declare a dividend by the Merger Agreement.

Our Board of Directors currently anticipates declaring a cash dividend prior to the closing of the Merger.

The declaration and payment

of dividends is subject to the discretion of our Board of Directors and will depend upon our earnings (if any), our financial condition,

and our capital requirements.

Nevada law permits a corporation to pay dividends out of earnings or surplus.

Any return to stockholders

will therefore be limited to the increase, if any, of our share price.

There can be no assurance that we will be

able to comply with the continued listing standards of the Nasdaq Capital Market, a failure of which could result in a de-listing of our

common stock and certain warrants .

The Nasdaq Capital Market requires that the trading

price of its listed stocks remain above one dollar in order for the stock to remain listed.

If a listed stock trades below one dollar

for more than 30 consecutive trading days, then it is subject to delisting from the Nasdaq Capital Market.

In addition, to maintain a

listing on the Nasdaq Capital Market, we must satisfy minimum financial and other continued listing requirements and standards, including

those regarding director independence and independent committee requirements, minimum stockholders’ equity, and certain corporate

governance requirements.

If we are unable to satisfy these requirements or standards, we could be subject to delisting, which would have

a negative effect on the price of our common stock and warrants and would impair your ability to sell or purchase our common stock or

warrants when you wish to do so.

In the event of a delisting, we would expect to take actions to restore our compliance with the listing

requirements, but we can provide no assurance that any such action taken by us would allow our common stock or warrants to become listed

again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the minimum

bid price requirement, or prevent future non-compliance with the listing requirements.

Provisions of our publicly traded warrants

could discourage an acquisition of us by a third party .

In addition to certain provisions of our amended and restated

articles of incorporation, as amended, and our amended and restated by-laws, certain provisions of our outstanding warrants could make

it more difficult or expensive for a third party to acquire us.

The warrants prohibit us from engaging in certain transactions constituting

“fundamental transactions” unless, among other things, the surviving entity assumes our obligations under the warrants.

and other provisions of the warrants could prevent or deter a third party from acquiring us even where the acquisition could be beneficial

Risks Relating to our Debt

able to comply with the continued listing standards of Nasdaq, a failure of which could result in a de-listing of our common stock and

certain warrants .

Nasdaq requires that the trading price of its

listed stocks remain above one dollar in order for stock to remain listed.

If a listed stock trades below one dollar for more than 30

consecutive trading days, then it is subject to delisting from the Nasdaq.

In addition, to maintain a listing on Nasdaq, we must satisfy

minimum financial and other continued listing requirements and standards, including those regarding director independence and independent

committee requirements, minimum stockholders’ equity, and certain corporate governance requirements.

If we are unable to satisfy

these requirements or standards, we could be subject to delisting, which would have a negative effect on the price of our common stock

and warrants and would impair your ability to sell or purchase our common stock or warrants when you wish to do so.

In the event of a

delisting, we would expect to take actions to restore our compliance with the listing requirements, but we can provide no assurance that

any such action taken by us would allow our common stock or warrants to become listed again, stabilize the market price or improve the

liquidity of our common stock, prevent our common stock from dropping below the minimum bid price requirement, or prevent future non-compliance

with the listing requirements.

Provisions of our warrants could discourage

an acquisition of us by a third party .

In addition to certain provisions of our amended

and restated articles of incorporation, as amended, and our amended and restated by-laws, certain provisions of our outstanding warrants

could make it more difficult or expensive for a third party to acquire us.

The warrants prohibit us from engaging in certain transactions

constituting “fundamental transactions” unless, among other things, the surviving entity assumes our obligations under the

These and other provisions of the warrants could prevent or deter a third party from acquiring us even where the acquisition

could be beneficial to you.

Risks Relating to Loan Agreement and our Debt

We are subject to credit risk related to the Loan Agreement and

related promissory note with ZenCredit which could lead to unexpected losses.

On August 8, 2025, we entered into the Loan Agreement with ZenCredit,

pursuant to which we agreed to loan ZenCredit up to $2 million.

Pursuant to the terms of the Loan Agreement, ZenCredit will pay us regular

quarterly interest payments at an annual interest rate of 16%.

The term of the initial promissory note is nine months at which time all

accrued principal and interest is due to us subject to the terms of the Loan Agreement.

On August 11, 2025, we loaned ZenCredit $2 million

in exchange for a promissory note issued pursuant to the Loan Agreement that matures on May 11, 2026.

As of December 31, 2025, we reserved

$12 thousand allowance for expected credit loss on the Note.

We are exposed to the risk that the principal of, or interest on, the

Loan Agreement and related promissory note will not be repaid timely or at all.

In addition, while ZenCredit has represented to us that

it owns assets the present fair value of which are greater than the amount that will be required to pay the probable liabilities of its

then existing debts and liabilities as they become due and payable considering all financing alternatives and potential asset sales reasonably

available to it;

and (ii) has capital that is not unreasonably small in relation to its respective business as presently conducted, the

promissory note under the Loan Agreement is not secured by any specific collateral and our remedies should a default occur will be limited

and may be insufficient to cover our outstanding exposure.

Under the Loan Agreement we are required to attempt to resolve any disputes

arising under the Loan Agreement through informal mediation and then arbitration prior to seeking any judicial remedy.

The creditworthiness of ZenCredit may be affected by many factors,

including local market conditions and general economic conditions, and ZenCredit may be less able to withstand competitive, economic and

financial pressures than other businesses, which could affect its ability to repay amounts outstanding under the Loan Agreement.

our review of ZenCredit prior to issuing the loan may not have adequately assessed and reduced our credit risk, and we may not adequately

adapt to changes in economic or any other conditions affecting ZenCredit and the quality of the loan.

These factors may result in unexpected

losses and adversely affect our business, financial condition, or results of operations.

If we do not timely pay amounts due and

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restrictive covenants that limit our operating flexibility.

As of January 21, 2025, the Term Note balance of the PNC Facility was paid

in full and no future principal payments are due.

As of December 31, 2025, $0 was outstanding on the RLOC.

In the event of a continuing default, our senior

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notes for the aggregate principal amount of $1,100 thousand.

As of January 21, 2025, $350 thousand was converted to common stock.

notes are subordinated unsecured obligations of the Company and accrue interest at a rate of 8% per year payable semiannually in arrears.

The notes will mature on August 25, 2026, unless earlier converted or repurchased at a conversion price of $1.15 per share of common stock.

As of March 13, 2026, $350 thousand was converted to common stock.

are subordinated unsecured obligations of the Company and accrue interest at a rate of 8% per year payable semiannually in arrears.

notes will mature on August 25, 2026, unless earlier converted or repurchased at a conversion price of $1.15 per share of common stock.

Although we believe the majority of our investors will choose to convert into shares, if this does not occur, this may have a material

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and remedies to collect such amounts, which would include foreclosing on collateral constituting substantially all of our assets and the

assets of our PeriShip Global subsidiary As a result, a default under applicable debt covenants could have an adverse effect on our financial

assets of our PeriShip Global subsidiary.

As a result, a default under applicable debt covenants could have an adverse effect on our financial

condition or results of operations.

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be in the best interests of our stockholders.

Risks Relating to the Merger

The Merger is subject to closing conditions

and may not be completed, the Merger Agreement may be terminated in accordance with its terms, and we may be required to pay a termination

fee upon termination.

The Merger is

subject to customary closing conditions that must be satisfied or waived prior to the consummation of the Merger, including, among other

(i) approval by our stockholders and Open World’s shareholders necessary to consummate the Merger and the contemplated transactions

thereunder having been duly obtained;

(ii) a registration statement on Form S-4 having been declared effective under the Securities Act

and not being subject to any stop order;

(iii) our common stock issuable in the Merger having been approved for listing on Nasdaq;

any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”) having expired

or been terminated, and all other required regulatory approvals having been obtained;

(v) Open World having received written approval

of the Merger by the Cayman Islands Trade and Business Licensing Board;

(vi) the absence of any order by a governmental authority permanently

enjoining or otherwise prohibiting consummation of the Merger;

(vii) the accuracy of the respective representations and warranties of

each party, subject to certain materiality qualifications;

(viii) compliance by the parties with their respective covenants;

the absence of any material adverse effect with respect to either party.

can be given that the required stockholder and shareholder approvals will be obtained or that the required conditions to closing will

be satisfied or waived, and, if all required approvals are obtained and the conditions are satisfied or waived, no assurance can be given

as to the terms, conditions, and timing of such approvals.

Any delay in completing the Merger could cause the combined company not to

realize, or to be delayed in realizing, some or all of the benefits that the parties expect to achieve if the Merger is successfully completed

within the expected time frame.

Additionally,

either party may terminate the Merger Agreement under certain circumstances, including, among other reasons, if the Merger is not completed

by June 30, 2026, subject to certain conditions.

In the event the Merger Agreement is terminated by us under specified circumstances,

we may be required to pay Open World a termination fee of $500,000 or an expense reimbursement fee of $400,000, as applicable.

The pendency of the Merger could adversely

affect our business and operations and the business operations of Open World.

Prior to closing, the Merger Agreement requires

us and Open World to conduct our respective businesses in the ordinary course consistent with past practices.

During the pendency of the

Merger, we have agreed to refrain from taking certain actions without Open World consent, including making certain acquisitions or dispositions,

incurring certain indebtedness, issuing equity securities (subject to limited exceptions), or entering into certain material contracts.

These restrictions may delay or prevent us from

pursuing business opportunities that may arise pending the completion of the Merger, which could have a material adverse effect on our

, financial condition, and results of operations, regardless of whether the Merger is ultimately consummated.

These restrictions could

also have a material adverse effect on Open World’s business, which could have a material adverse effect on the combined company’s

business, financial condition, and results of operations should the Merger be consummated.

The risk, and adverse effect, of such restrictions

could be exacerbated by any delay in consummation of the Merger or termination of the Merger Agreement.

The announcement and pendency of the Merger

may create uncertainty that could adversely affect our business relationships and the business relationships of Open World.

Parties with which we and Open World do business

may experience uncertainty associated with the Merger, including with respect to current or future business relationships with the combined

company following the Merger.

Customers, suppliers, distributors, and other business partners may delay or defer entering into new business

relationships, seek to negotiate changes to existing relationships, or consider entering into relationships with parties other than us

or Open World.

In addition, uncertainty about the effect of the

Merger on employees may adversely affect the parties’ ability to attract, retain, and motivate key personnel during the pendency

of the Merger and for a period of time thereafter.

Key employees may depart because of issues relating to the uncertainty and difficulty

of integration or a desire not to remain with the combined company following the Merger, which could have a material adverse effect on

the business, financial condition, and results of operations of either party or the combined company.

Securities class action and derivative lawsuits

may be filed challenging the Merger, and an adverse ruling in any such lawsuit may delay or prevent the Closing.

Securities class action lawsuits and derivative

lawsuits are often brought against public companies that have entered into merger or business combination agreements.

Such lawsuits may

be brought against us, Open World, or our respective directors, alleging that the boards of directors breached their fiduciary duties

to stockholders or shareholders by entering into the Merger Agreement.

There can be no assurance that such litigation

or legal proceedings will not be brought, and if brought, that we or Open World will be successful in defending against them.

outcome in such matters, as well as the costs and efforts of a defense even if successful, could have a material adverse effect on the

business, results of operations, or financial position of the parties or the combined company, including through the possible diversion

of resources or distraction of key personnel.

One of the conditions to the Closing is that no order by any court or governmental authority

has been entered that prohibits the Merger, and consequently, if a plaintiff is successful in obtaining such an order, the Merger may

be delayed or prevented from being completed.

The Merger may be completed even though

a material adverse effect may result from the announcement of the Merger, industry-wide changes, or other causes.

In general, neither we nor Open World are obligated

to complete the Merger if there is a material adverse effect affecting the other party between the date of the Merger Agreement and the

However, certain types of changes are excluded from the concept of a “material adverse effect” as defined in the

Merger Agreement.

Such exclusions include but are not limited to:

changes in general economic, business, financial, regulatory or domestic or international political conditions;

natural disasters, pandemics,

or other public health events;

changes in cryptocurrency or digital asset market conditions, regulatory developments affecting digital

assets, or volatility in cryptocurrency valuations;

a decline in the market price or trading volume of our common stock;

changes resulting

from the announcement or pendency of the Merger;

changes in applicable laws or GAAP;

and actions required by a governmental authority

pursuant to Antitrust Laws (as defined in the Merger Agreement).

Therefore, if any of these events were to occur affecting either us or

Open World, the other party would still be obligated to effect the Closing, and the stock price of the combined company may suffer.

in turn may reduce the value of the Merger to our stockholders or Open World securityholders, or both.

If the Merger is not completed, our stock

price may decline significantly, and our business may be adversely affected.

If the Merger is not completed for any reason,

including as a result of either party’s stockholders or shareholders failure to approve the applicable proposals, our ongoing business

may be adversely affected.

Without realizing any of the expected benefits of the Merger, we would be subject to a number of risks, including

the following:

· We may experience negative reactions from the financial markets, including negative impacts on the price

of our common stock.

· We may experience negative reactions from our customers, suppliers, business partners, and employees.

· We will be required to pay our costs relating to the Merger, such as financial advisory, legal, and accounting

fees, whether or not the Merger is completed.

· The market price of our common stock could decline to the extent that the current market price reflects

a market assumption that the Merger will be completed.

The Exchange Ratio in the Merger is fixed

and will not be adjusted to reflect changes in the market price of our common stock or changes in the relative performance of the parties.

Under the Merger Agreement, each ordinary shares

of Open World (other than excluded shares and dissenting shares), and certain other Open World securities, as set forth in the Merger

Agreement, will be converted or have the right to convert into a number of shares of our common stock equal to the Exchange Ratio.

Exchange Ratio is fixed and will not be adjusted based on changes in the market price of our common stock or the economic performance

of either party prior to the Closing.

If the market price of our common stock increases

before the Closing, Open World securityholders may receive consideration with a higher dollar value than was negotiated at the time the

Merger Agreement was executed.

Conversely, if the market price of our common stock decreases before the Closing, Open World securityholders

may receive consideration with a lower dollar value.

The Merger Agreement does not contain a price-based termination right.

Some of our and Open World officers and

directors have interests in the Merger that are different from yours and that may influence them to support or approve the Merger without

regard to your interests.

Certain of our and Open World officers and directors

participate in arrangements that provide them with interests in the Merger that are different from yours, including, among others, the

continued service as an officer or director of the combined company, severance benefits, the acceleration of certain outstanding equity

awards, and continued indemnification.

For example, after the Merger, Scott Greenberg,

our current Chairman will continue as a director of the combined company and may receive cash and other compensation from the combined

Additionally, Adam Stedham, our Chief Executive Officer and President, and Jennifer Cola, our Chief Financial Officer, will continue

as officers of the combined company pursuant to written employment agreements.

Further, upon the Effective Time of the Merger, the vesting

of certain outstanding equity awards held by our directors and officers will accelerate.

These interests, among others, may influence our

and Open World’s officers and directors to support or approve the Merger.

The Merger will involve substantial costs,

whether or not the Merger is consummated.

We and Open World have incurred and expect to

continue to incur substantial non-recurring costs associated with the Merger, including transaction fees and other costs related to completing

the transaction.

These costs and expenses include fees paid to legal, financial, and accounting advisors, filing fees, printing costs,

and other costs and expenses.

Portions of these transaction costs are contingent upon the Closing occurring, although some have been and

will be incurred regardless of whether the Merger is consummated.

The Merger Agreement limits our and Open

World’s ability to pursue alternatives to the Merger and includes the potential obligation to pay a Termination Fee.

Under the Merger Agreement, both we and Open World

are subject to customary “no-shop” restrictions that limit our ability to solicit, initiate, or knowingly facilitate or encourage

alternative acquisition proposals.

From the date of the Merger Agreement until the earlier of the Closing or the termination of the Merger

Agreement, each party has agreed not to engage in discussions or negotiations with, or furnish information to, any third party that is

seeking to make or has made an acquisition proposal.

However, under certain circumstances, our Board

of Directors may engage in negotiations with a third party that makes an unsolicited bona fide written acquisition proposal if our board

determines in good faith, after consultation with its financial advisor and outside legal counsel, that such proposal constitutes a superior

proposal and that failure to engage in such negotiations would be inconsistent with its fiduciary duties.

If our Board of Directors changes

its recommendation to stockholders or terminates the Merger Agreement to enter into an alternative transaction, we may be required to

pay Open World a termination fee of $500,000.

These provisions

could discourage a potential third-party acquirer that might have an interest in acquiring all or a significant portion of VerifyMe from

considering or proposing that acquisition, even if it were prepared to pay a higher price than the implied value of the Merger, or might

result in a potential third-party acquirer proposing a lower price because of the added expense of the termination fee.

We and Open World must obtain certain regulatory

approvals and clearances to consummate the Merger, which, if delayed, not granted, or granted with unacceptable conditions, could prevent,

substantially delay, or impair consummation of the Merger.

Completion of the Merger is conditioned upon the

expiration or termination of the applicable waiting period under the HSR Act and receipt of all other required regulatory approvals, including

any approvals required by state or federal regulators for digital asset or cryptocurrency-related business activities.

In addition, Open

World is required to receive written approval of the Merger from the Cayman Islands Trade and Business Licensing Board.

Both we and Open World have agreed to make any

necessary filings under the HSR Act and other applicable Antitrust Laws as promptly as practicable and to use reasonable best efforts

to obtain all necessary regulatory approvals.

However, there can be no assurance that the relevant waiting periods will expire, or that

regulatory authorizations will be obtained.

At any time before or after consummation of the Merger, the Department of Justice, the Federal

Trade Commission, any state attorney general, or a governmental authority in another jurisdiction could take action under applicable antitrust

laws, including seeking to enjoin completion of the Merger or requiring divestitures or other concessions as a condition to approval.

Any conditions, limitations, or delays in obtaining

regulatory approvals could have the effect of delaying or impeding consummation of the Merger or imposing additional costs or limitations

on the combined company following completion of the Merger.

Risks Relating to the Combined Company should

the Merger be effected

Combining our and Open World’s businesses

may be more difficult, costly or time-consuming than expected and the combined company may fail to realize the anticipated synergies and

other benefits of the Merger, which may adversely affect the combined company’s business results and negatively affect the value

of the combined company’s common stock following the Closing.

The success of the Merger will depend, in part,

on the combined company’s ability to realize the anticipated benefits and synergies from integrating our and Open World’s

To realize these anticipated benefits and synergies, the combined company must successfully combine and integrate the operations

of both companies.

If the combined company is unable to achieve these objectives, the anticipated benefits and synergies of the Merger

may not be realized fully, or at all, or may take longer to realize than expected.

The integration process may involve unforeseen

difficulties and may require a disproportionate amount of management and financial resources.

Potential difficulties the combined company

may encounter in the integration process include:

· combining the companies’ operations and corporate functions;

· integrating personnel from the two companies;

· harmonizing operating practices, employee development and compensation programs, internal controls, and other policies, procedures,

and processes;

· maintaining existing agreements with customers, suppliers, and vendors and leveraging relationships with such third parties for the

benefit of the combined company;

· addressing possible differences in business backgrounds, corporate cultures, and management philosophies;

· consolidating the companies’ administrative and information technology infrastructure;

· coordinating distribution and marketing efforts.

It is possible that the integration process could

result in the loss of key employees, the loss of customers, the disruption of either company’s or both companies’ ongoing

businesses, inconsistencies in standards, controls, procedures, and policies, unexpected integration issues, higher than expected integration

costs, and an overall post-completion integration process that takes longer than originally anticipated.

The actual integration may result

in additional and unforeseen expenses.

If the combined company is not able to adequately address integration challenges, we may be unable

to successfully integrate operations and the anticipated benefits of the integration plan may not be realized.

An inability to realize the full extent of the

anticipated benefits of the Merger, as well as any delays encountered in the integration process, could have an adverse effect upon the

revenues, level of expenses and operating results of the combined company, which may adversely affect the value of the combined company’s

common stock following the consummation of the Merger.

Moreover, if the combined company is unable to realize the full strategic and financial

benefits currently anticipated from the Merger, our stockholders will have experienced substantial dilution of their ownership interests

without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent the combined company is able

to realize only part of the strategic and financial benefits currently anticipated from the Merger.

The combined company may not be able to

retain customers, suppliers, or business partners, or such third parties may seek to modify contractual relationships with the combined

company, which could have an adverse effect on the combined company’s business and operations.

Third parties may terminate or alter existing

contracts or relationships with the combined company as a result of the Merger.

Certain customers, suppliers, or other business partners

may seek to terminate or modify contractual obligations following the Closing, whether or not contractual rights are triggered as a result.

There can be no guarantee that customers, suppliers, and business partners will remain with or continue to have a relationship with the

combined company or do so on the same or similar contractual terms following the Closing.

If any customers, suppliers or distributors

seek to terminate or modify contractual obligations or discontinue the relationship with the combined company, then the combined company’s

business and results of operations may be harmed.

If the combined company’s suppliers or other

business partners seek to terminate or modify an arrangement with the combined company, the combined company may be unable to procure

necessary services from other providers in a timely and efficient manner and on acceptable and cost-effective terms, or at all.

we and Open World have contracts with third parties that may require consent from these parties in connection with the Merger.

consents cannot be obtained, the combined company may suffer a loss of potential future revenue, incur costs, and lose rights that may

be material to the combined company's business.

In addition, third parties with whom we or OpenWorld currently have relationships may

terminate or otherwise reduce the scope of their relationship in anticipation of the Closing.

Any such disruptions could limit the combined

company’s ability to achieve the anticipated benefits of the Merger.

The adverse effect of any such disruptions could also be exacerbated

by a delay in the Closing or by a termination of the Merger Agreement.

If the combined company fails to attract

and retain management and other key personnel, it may be unable to successfully integrate the businesses or execute its business plan.

The combined company’s ability to compete

in its industry depends on its ability to attract and retain highly qualified managerial, financial, technical, and other personnel.

combined company will be highly dependent on its management and key employees.

Competition for qualified personnel is intense, and there

can be no assurance that the combined company will be able to attract and retain the personnel necessary for the development of its business.

In particular, the combined company’s success will depend on the continued services of Open World’s Chief Executive Officer,

Matthew Shaw, who will continue in such role following the Merger.

Shaw, who brings extensive experience in the finance industry and

management of crypto and other digital asset companies, is critical to the combined company’s strategic plan, and the loss of him

could significantly disrupt the combined company’s operations.

The combined company will operate in complex and

rapidly evolving segments of the digital assets industry that are not widely understood and that require highly specialized expertise

in areas such as blockchain infrastructure design, tokenomics, exchange and market structure, regulatory compliance across multiple jurisdictions,

real-world asset tokenization, and post-launch operations.

The pool of individuals with the background and experience necessary to provide

Open World’s infrastructure and launch services, including senior leaders with financial, crypto and regulatory expertise, is extremely

The combined company will face intense competition for qualified personnel from other consulting and advisory firms, crypto-native

companies, software and other technology firms, financial institutions, and emerging Web3 projects, many of which have significantly greater

resources, brand recognition, or compensation flexibility than the combined company will.

Open World’s executives, including Mr.

are employed at will and may terminate employment at any time, and Open World does not currently maintain key-person life insurance for

its executive officers.

The loss of any key personnel, or the inability to attract and retain key personnel, could delay or prevent the

achievement of the combined company’s business objectives and could materially and adversely affect the combined company’s

business, financial condition, and results of operations.

Following the Merger, our current stockholders

will have a significantly reduced ownership and voting interest in the combined company compared to their ownership of VerifyMe prior

to the Merger.

After the Closing, our current stockholders will

own a significantly smaller percentage of the combined company than their ownership of VerifyMe prior to the Merger.

Immediately after

the Closing, our stockholders as of immediately prior to the Closing, are expected to own approximately 10% of the outstanding shares

of the combined company, and Open World securityholders are expected to own approximately 90% of the outstanding shares of the combined

The exact equity stake of our stockholders and Open World securityholders in the combined company immediately following the Effective

Time will depend on the Fully Diluted Parent Common Stock and Fully Diluted Company Shares (each as defined in the Merger Agreement) determined

immediately prior to the Closing.

As a result of this reduced ownership percentage,

our current stockholders will be able to exercise significantly less influence over the management and policies of the combined company

following the Merger than they currently exercise over VerifyMe.

Similarly, Open World securityholders who become our stockholders will

own a majority of the outstanding shares of common stock of the combined company.

The market price of the combined company’s

common stock after the Merger may be affected by factors different from those currently affecting the shares of our common stock prior

to completion of the Merger.

Upon completion of the Merger, Open World securityholders

will become our stockholders as stockholders of the combined company.

Our business currently differs, and may differ in the future, in

certain respects from that of Open World and certain adjustments may be made to our business as a result of the Merger.

Accordingly, the

results of operations of the combined company and the market price of the combined company’s common stock after the completion of

the Merger may be affected by factors different from those currently affecting our results of operations and market price of our common

stock prior to completion of the Merger.

The combined company may be unable to obtain

the additional capital, equity or debt financing required to fund its operations and growth, which could adversely affect its business,

prospects and ability to continue as a going concern.

We and Open World expect the combined company

to require substantial additional capital to fund working capital needs and to support its growth initiatives.

The combined company’s

capital needs may increase due to factors outside its control, including regulatory changes affecting digital assets, volatility in crypto

markets that impacts client demand, elongated client sales cycles, delayed collections, or unanticipated operating or legal expenses.

The combined company may seek additional funds through dilutive equity offerings, debt financings, strategic investments, joint ventures

or other arrangements.

However, market conditions, including periods of illiquidity or volatility in broader capital markets or in the

digital asset sector, may limit its ability to raise funds in a timely manner, in sufficient quantities, or on terms acceptable to the

combined company, if at all.

If the combined company raises additional equity

financing, holders of its equity securities may experience dilution, the per share value of its equity securities could decline, and new

securities may have rights, preferences or privileges that are senior to those of its existing stockholders.

If the combined company incurs

indebtedness, the terms of any debt securities or credit facilities may contain restrictive covenants that limit its ability to incur

additional debt, pay dividends, repurchase shares, make investments, dispose of assets, or engage in certain business activities, including

entering new markets or consummating acquisitions.

Debt instruments may also require the combined company to maintain specified financial,

liquidity or other ratios, grant security interests in its assets, and could include variable interest rates that increase its cost of

In the event of a liquidation or bankruptcy, lenders would be repaid before holders of its equity securities.

If the combined

company issues convertible or other derivative securities, they may contain anti-dilution or reset provisions that could result in additional

dilution to stockholders.

The combined company’s ability to raise

capital may also be constrained by its operating performance, the perceived risks of its business model, its limited operating history

in public markets, and legal or regulatory developments affecting crypto-related businesses, including restrictions on certain activities,

enhanced compliance requirements, or adverse enforcement actions in jurisdictions where the combined company or its clients operate.

Additionally,

counterparties may require terms that are costly or include governance, information or consent rights that limit its flexibility.

are unavailable or insufficient, or are available only on unfavorable terms, the combined company may be forced to delay, scale back or

discontinue some or all of its growth plans, reduce headcount or marketing, forgo strategic opportunities, or alter its business model.

Any of these outcomes could materially and adversely affect its competitive position, client relationships and reputation, and could harm

its business, financial condition, results of operations and prospects.

If the combined company cannot obtain sufficient capital to meet

its obligations as they come due, the combined company may be unable to continue as a going concern.

Open World’s management has limited

experience in operating a public company and may not successfully or effectively manage the transition to a public company.

The executive officers of Open World have limited

experience in the management of a publicly traded company.

The Open World management team may not successfully or effectively manage its

transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities

While members of the management team have extensive experience in the finance and digital asset and token industries, their limited

experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it

is likely that an increasing amount of their time may be devoted to these activities, which will result in less time being devoted to

the management and growth of the combined company.

The combined company may not have adequate personnel with the appropriate level of

knowledge, experience, and training in the accounting policies, practices or internal control over financial reporting required of public

companies in the United States.

The development and implementation of the standards and controls necessary for the combined company to

achieve the level of accounting standards required of a public company in the United States may require costs greater than expected.

is possible that the combined company will be required to expand its employee base and hire additional employees to support its operations

as a public company, which will increase its operating costs in future periods.

The combined company is expected to be a

controlled company as defined under Nasdaq exchange listing rules and should it choose to rely on controlled company exemptions, you would

not have the same protections afforded to stockholders of companies that are subject to these corporate governance requirements.

Immediately following this offering, we expect

that some Open World securityholders will beneficially own more than 50% of the voting power of the combined company’s outstanding

common stock.

Under the Nasdaq listing rules, a company of which more than 50% of the voting power is held by an individual, group, or

another company is a controlled company and is permitted to elect to rely, and may rely, on certain exemptions from corporate governance

requirements, including:

· an exemption from the requirement that a majority of its board of directors be independent directors;

· an exemption from the requirement that its compensation committee be comprised entirely of independent

directors and have a written charter addressing the committee’s purpose and responsibilities.

If the combined company relies on any such exemptions,

our current stockholders who remain stockholders of the combined company and the combined company’s investors would not have the

same protections afforded to stockholders of companies that are subject to these corporate governance requirements.

The combined company’s

status as a controlled company could make the combined company’s common stock less attractive to certain investors, could limit

the oversight of management by the combined company’s board of directors, and could adversely affect the trading price or liquidity

of the combined company’s common stock.

In addition, the Open World securityholders holding more than 50% of the voting power of

the combined company, either individually or if applicable as a group, will be able to exert significant influence over the outcome of

matters requiring stockholder approval of the combined company, including the election of directors, mergers, acquisitions, dispositions,

financing transactions, and other significant corporate actions, which may conflict with the interests of its other stockholders.

company operating in the crypto infrastructure and token launch services industry, where regulatory expectations and market practices

continue to evolve, such concentration of control could also influence its approach to governance, compliance, or risk tolerance in ways

that other stockholders may not view as favorable.

Upon and after completion of the Merger,

the combined company may be unable to meet the continued listing standards of Nasdaq, which could result in delisting, reduced liquidity,

increased volatility, and harm to its ability to raise capital.

Upon completion of the Merger, the combined company

will be required to meet the initial and continuing listing requirements to maintain the listing and continued trading of its common stock

These initial listing requirements are more difficult to achieve than the continued listing requirements.

Pursuant to the Merger

Agreement, we agreed to take, or cause to be taken, all actions, and to do or cause to be done all things, necessary, proper or advisable

under applicable laws and the rules and policies of Nasdaq and the SEC to cause the shares of our common stock being issued in the Merger

to be approved for listing on Nasdaq at or prior to the Effective Time.

Based on information currently available to us, we anticipate

that our common stock will be unable to meet the $4.00 (or, to the extent applicable, $3.00) minimum bid price initial listing requirement

at the Closing unless we effect a reverse stock split.

Pursuant to the Merger Agreement, upon Open World’s request, our Board of

Directors would be required to effect a reverse stock split of our issued and outstanding common stock at a ratio ranging from any whole

number between 1-for-2 and 1-for-10, as determined by our Board of Directors in its discretion.

At our annual meeting of stockholders

held on October 8, 2025, our stockholders authorized our Board of Directors to effect at any time until the

one-year anniversary date of the annual meeting , in its discretion, a reverse stock split of our outstanding and treasury shares

of common stock at a ratio ranging from 1-for-2 to 1-for 10, to be determined by our Board of Directors, without any corresponding change

in the number of authorized shares of our common stock and approved a corresponding amendment to our Amended and Restated Articles of

Incorporation, as amended, to effect the reverse stock split.

Often times a reverse stock split will not result in a trading price for

the affected common stock that is proportional to the ratio of the split.

Following the merger, if the combined company is unable to satisfy

Nasdaq listing requirements, Nasdaq may notify the combined company that its shares of common stock will not be listed on Nasdaq.

Upon a potential delisting from Nasdaq, if the

common stock of the combined company is not then eligible for quotation on another market or exchange, trading of the shares could be

conducted in the over-the-counter market or on an electronic bulletin board established for unlisted securities such as the

Pink Sheets or the OTC Bulletin Board.

In such event, it is likely that there would be significantly less liquidity in the trading of

the common stock of the combined company;

decreases in institutional and other investor demand for the shares, coverage by securities

analysts, market making activity and information available concerning trading prices and volume;

and fewer broker dealers willing to execute

trades in the common stock of the combined company.

Also, it may be difficult for the combined company to raise additional capital if

the combined company’s common stock is not listed on a major exchange.

The occurrence of any of these events could result in a further

decline in the market price of the common stock of the combined company and could have a material adverse effect on the combined company.

Even if the combined company remains listed, failure

to maintain compliance on a consistent basis or to timely cure any deficiency could divert significant management attention and resources,

subject it to public warnings or grace periods, and negatively affect the market price and liquidity of its securities.

There can be no

assurance that the combined company will be able to regain or maintain compliance with the continued listing requirements, that any appeal

or plan of compliance would be successful, or that the combined company’s securities will remain listed.

Any of the foregoing could

materially and adversely affect the value of the combined company’s common stock.

Risks Relating to a Reverse Stock Split

Subject to the Merger Agreement, our Board of Directors currently

has discretion to effect a reverse stock split of our common stock at a ratio ranging from 1-for-2 to 1-for 10 without further stockholder

approval, which could adversely effect our stockholders and the value of our common stock.

At our annual meeting of stockholders held on

October 8, 2025, our stockholders authorized our Board of Directors to effect at any time until the

one-year anniversary date of the annual meeting , in its discretion, a reverse stock split of our outstanding and treasury shares

of common stock at a ratio ranging from 1-for-2 to 1-for 10, to be determined by our Board of Directors, without any corresponding change

in the number of authorized shares of our common stock and approved a corresponding amendment to our Amended and Restated Articles of

Incorporation, as amended, to effect the reverse stock split.

Pursuant to the Merger Agreement, we have agreed not to effect a reverse

stock split unless requested by Open World.

Based on information currently available to us,

we anticipate that our common stock will be unable to meet the $4.00 (or, to the extent applicable, $3.00) minimum bid price initial listing

requirement at the Closing of the Merger unless we effect a reverse stock split.

There is no assurance that if a reverse stock split is

implemented it will result in:

· a share price that will comply with Nasdaq’s minimum bid price initial listing requirement at the

Closing of the Merger;

· a share price of the combined company that will comply with Nasdaq’s continued listing standards;

· a trading price for our common stock that is proportional to the ratio of the split;

· a share price that will attract new investors, including institutional investors, or that the market price

of our common stock will satisfy the investing requirements of those investors;

· an improvement in the trading liquidity of our common stock.

Additionally, if a reverse

stock split is effected, it may:

· adversely effect the liquidity of the shares of our common stock, especially if the market price of our

common stock does not increase as a result of the reverse stock split;

· may increase the number of stockholders who own odd lots (less than 100 shares) of our common stock, creating

the potential for such stockholders to experience an increase in the cost of selling their shares and greater difficulty effecting such

Any of the foregoing could adversely affect our

stockholders and value of our common stock.

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