BOXL Boxlight Corp - 10-K

ITEM 1A. RISK FACTORS

An investment in our securities involves a high degree of risk. You should carefully consider all of the risks described below, together with the other information contained in this Annual Report, including our financial statements and related notes, before making a decision to invest in our securities. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment.

Summary Risk Factors

Some of the factors that could materially and adversely affect our business, financial condition, results of operations, and cash flows include, but are not limited to, the following:

• our ability to continue to operate as a going concern;

• our ability to maintain a listing of our Class A common stock on the Nasdaq Capital Market;

• our ability to comply with certain covenants, minimum EBITDA and borrowing base requirements under our existing credit agreement, or in the alternative, to continue to obtain forbearances or waivers from the lender thereunder;

• our indebtedness, a substantial amount of which is bearing interest at a variable rate;

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• our history of operating losses;

• our ability to raise additional capital;

• changes in the sales of our display products;

• changes in U.S. administrative policy, including the imposition of or increases in tariffs, changes to existing trade agreements, and any resulting changes in international trade relations, such as trade wars;

• changes in the spending policies or budget priorities for government funding of schools, colleges, universities, other education providers, or government agencies;

• seasonal fluctuations in our business;

• changes in our working capital requirements and cash flow fluctuations;

• competition in our industry;

• our ability to enhance our products and to develop, introduce, and sell new technologies and products at competitive prices and in a timely manner;

• our reliance on resellers and distributors to promote and sell our products;

• the success of our strategy to increase sales in the business and government market;

• changes in market saturation for our products;

• challenges growing our sales in foreign markets;

• our dependency on third-party suppliers;

• our reliance on highly skilled personnel;

• our ability to enter into and maintain strategic alliances with third parties;

• our inability to successfully complete or manage strategic restructuring;

• unfavorable global economic or political conditions, including the ongoing conflict between Russia and Ukraine, and Israel and Hamas, and broader instability in the Middle East, which may disrupt global freight routes and supply chains;

• war, terrorism, other acts of violence, or potential effects of future pandemics;

• a breach in security of our electronic data or our information technology systems, including any cybersecurity attack;

• our ability to keep pace with developments in technology;

• consumer product and environmental laws;

• risks inherently related to our foreign operations;

• our compliance with the Foreign Corrupt Practices Act;

• income taxation for our worldwide operations;

• our ability to ship and transport components and final products efficiently and economically across long distances and borders;

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• compliance with export control laws;

• fluctuations in foreign currencies;

• unstable market and economic conditions and potential disruptions in the credit markets;

• defects in our products and detection thereof;

• patents or other intellectual property rights necessary to protect our proprietary technology and business;

• assertions against us relating to intellectual property rights;

• our inability to predict or anticipate the duration or adapt to the long-term economic and business consequences of a global pandemic;

• our inability to predict or adapt to the unstable market and economic conditions of the global economy;

• our ability to continue to attract and retain customers;

• our ability to sell additional products and services to customers;

• our ability to raise funds in a timely fashion and successfully manage cash flow needs and financing plans;

• our ability to anticipate consumer preferences and successfully develop attractive products; and

• our ability to develop, implement, and maintain an effective system of internal control over financial reporting.

Risks Related to Our Business, Operations, and Financial Condition

We have not complied with certain covenants, minimum liquidity, and borrowing base requirements under the Credit Agreement and this could cause us to be unable to continue to operate as a going concern.

As of December 31, 2025, we owed approximately $32.2 million to the lender under our Credit Agreement. During 2024 and 2025, we did not comply with certain financial covenants, minimum liquidity requirements, and borrowing base requirements under the Credit Agreement. Although we have obtained waivers and amendments from the lender with respect to these instances of noncompliance, there can be no assurance that we will be able to maintain compliance with the Credit Agreement in the future or that additional waivers or amendments will be available on acceptable terms or at all.

We were in compliance with the borrowing base requirements under the Credit Agreement for the period ended December 31, 2025. On December 18, 2025, the Company entered into the Eleventh Amendment to the Credit Agreement, which eliminated the Senior Leverage Ratio covenant and replaced it with a Minimum Consolidated Adjusted EBITDA covenant, commencing with the period ending March 31, 2026.

These conditions, together with our historical operating losses and liquidity constraints, raise substantial doubt about our ability to continue as a going concern for a period of one year following the issuance of these financial statements.

Our ability to continue as a going concern is dependent upon our ability to generate sufficient cash flows from operations, obtain additional waivers or other relief under the Credit Agreement for any future covenant or borrowing base noncompliance, or refinance our indebtedness with the existing lender or a new lender. If the lender were to refuse to grant future waivers or declare an event of default, the lender could accelerate the maturity of our obligations under the Credit Agreement.

In the event of an acceleration, we would be required to refinance our indebtedness or obtain additional capital, which we may not be able to do on acceptable terms, on a timely basis, or at all. Our ability to refinance existing debt or raise additional capital is dependent on market conditions and other factors beyond our control.

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If we were required to pursue refinancing or capital raising in response to an imminent or declared default, we could be forced to do so on an expedited basis, which could further limit available options and adversely affect the terms of any such transaction. If we are unable to successfully execute one or more of the foregoing plans, our business, financial condition, and results of operations could be materially adversely affected, and we may be required to significantly curtail or cease operations.

In view of these matters, continuation as a going concern is dependent upon our ability to continue to achieve positive cash flow from operations, obtain waivers or other relief under the Credit Agreement for any future non-compliance with the Senior Leverage Ratio, borrowing base requirements, or any other covenants or requirements under the Credit Agreement, or refinance our Credit Agreement with a different lender. Furthermore, in the event the Lender refuses to grant waivers to avoid a future default, the Lender might accelerate our obligations under the Credit Agreement. In order to satisfy such obligations, we would similarly have to refinance our obligations or seek additional capital, which we might not be able to do on acceptable terms or on a timely basis, or at all. Our ability to refinance our existing debt is based upon credit markets and economic forces that are outside of our control. There can be no assurance that we will be successful in refinancing our debt or raising additional capital, whether on acceptable terms, or on a timely basis, or at all. Furthermore, if we were attempting to refinance our obligations or raise capital in response to an imminent or declared acceleration and default, we might have to do so on an expedited basis, which might further jeopardize our ability to successfully refinance or obtain capital. In the event we fail in any of the efforts described in the preceding sentences, our business may materially suffer or even cease operations.

Additionally, as we have previously disclosed, there is substantial doubt about our ability to continue as a going concern.

We have a substantial amount of indebtedness bearing interest at a variable rate, which may adversely affect our cash flow and our ability to operate our business.

We have a significant amount of indebtedness. As of December 31, 2025, we have approximately $32 million of indebtedness outstanding, all of which is secured. Our substantial amount of indebtedness could have important consequences. For example, it could:

• increase our vulnerability to adverse economic, industry, or competitive developments;

• result in an event of default if we fail to satisfy our obligations with respect to our Credit Agreement or which event of default could result in all of our debt becoming immediately due and payable and could permit our lenders to foreclose on our assets securing such debt;

• require a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use cash flow to fund our operations, capital expenditures, and future business opportunities;

• limit our ability to service our indebtedness; or

• limit our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, or general corporate purposes.

The occurrence of any one of these events could have a material adverse effect on our business, financial condition, results of operations, or prospects.

In addition, borrowings under the Credit Agreement bear interest at variable rates. If these rates were to increase significantly, the risk related to our substantial indebtedness would intensify. While we may enter into agreements limiting our exposure to higher interest rates, any such agreements may not offer complete protection for this risk.

Our ability to raise additional capital may be limited by various factors, including doubts as to our ability to continue as a going concern, our substantial indebtedness, the terms of our preferred stock, and warrants and potentially limited availability of shares of Class A common stock under our charter.

In order to continue to operate our business, we expect to need to raise additional capital, whether to refinance our outstanding indebtedness or to fund working capital needs.

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Our ability to raise additional capital is based upon equity and credit markets and economic forces that are outside of our control. Because of doubts about our ability to continue as a going concern, our substantial indebtedness, there can be no assurance that we will be successful in refinancing our debt or raising additional capit al, whether on acceptable terms, or at all. Furthermore, if we were attempting to refinance our obligations or raise capital in response to an imminent or declared acceleration and default on our indebtedness, we might have to do so on an expedited basis, which might further jeopardize our ability to successfully refinance or obtain capital.

Certain terms of the warrant we issued to the lender under our credit agreement may discourage potential equity investors. The warrant was originally issued to the lender in partial consideration for entering into the credit agreement on December 31, 2021. The warrant was originally exercisable for 8,514 shares of Class A common stock at $480.00 per share. Pursuant to the terms of the warrant, based on the Class A common stock price on March 31, 2022, the exercise price per share and shares issuable under the warrant were adjusted to $285.60 and 14,309, respectively. Furthermore, under the terms of the warrant, certain subsequent equity issuances at a price per share less than then-effective exercise price per share under the warrant trigger additional adjustments of the exercise price and shares subject to exercise. Pursuant to such adjustments features, an equity issuance in 2022 caused the exercise price per share and shares issuable under the warrant to adjust to $264.00 and 15,480, respectively. Following our equity issuance in February 2025, the exercise price per share and shares issuable under the warrant were adjusted to $116.34 and 35,121, respectively. In September 2025, we entered into a Securities Purchase Agreement with certain institutional accredited investors, and the exercise price per share and shares issuable under the warrant were adjusted to $90.66 and 45,077 shares, respectively. In October 2025, all outstanding shares of the Series B and Series C convertible preferred stock were converted into shares of the Class A common stock. The exercise price per share was adjusted to $87.48 per share, and the number of shares issuable upon exercise increased to 46,704 shares. Future equity issuances at a price per share less than $116.34 that are not exempt from the adjustment feature would trigger further adjustments. These features may discourage future equity investors, thus potentially further hampering our capital raising efforts.

In addition, following a private placement offering in February 2025, which included the issuance of 1,323,000 common warrant shares, the number of authorized but unissued shares of Class A common stock remaining under our articles of incorporation would not be sufficient to issue shares should all of the common warrants be exercised. On February 20, 2025, the Company filed with the Secretary of State of the State of Nevada amendments to increase the number of authorized shares of Class A common stock to at least 25,000,000 shares.

In an effort to maintain the listing of the Company’s Class A common stock on the Nasdaq Capital Market, during 2025, the Company effected two reverse stock splits of its Class A common stock. On February 14, 2025, the Company effected a 1-for-5 reverse stock split of its authorized, issued and outstanding shares of Class A common stock. Subsequently, on December 22, 2025, the Company effected an additional 1-for-6 reverse stock split of its issued and outstanding shares of Class A common stock pursuant to a Certificate of Change filed with the Secretary of State of the State of Nevada on December 16, 2025. As a result of these reverse stock splits and the resulting reduction in the number of authorized but unissued shares of Class A common stock, the Company’s ability to raise additional capital through the issuance of Class A common stock or securities convertible into or exercisable for Class A common stock has been significantly constrained.

In the event we are unable to raise capital in the future in sufficient amounts, on a timely basis or on acceptable terms, our business may materially suffer or even cease operations.

We have incurred net losses, our revenues have been declining, and our future profitability is not certain.

For the fiscal years ended December 31, 2025 and 2024, we incurred net losses attributable to common stockholders of $25.1 million and $29.6 million, respectively. Our total revenues declined 19.6% from $135.9 million for the fiscal year ended December 31, 2024 to $109.2 million for the fiscal year ended December 31, 2025. Our operating results for future periods are subject to numerous uncertainties and we cannot be certain that we will be profitable or that we will not experience further substantial losses in the future. If we are not able to increase revenue and reduce our costs or otherwise improve our margins, we may not be able to achieve profitability in future periods and our business, financial condition, results of operations, and cash flows may be adversely affected.

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Unfavorable global economic or political conditions, including the ongoing and widespread conflicts, may adversely affect our business, financial condition, or results of operations .

Our results of operations could be adversely affected by general conditions in the global economy and in the global financial markets. Inflation rates, particularly in the United States, have increased recently to levels not seen in years. Increased inflation may result in increased operating costs (including our labor costs), reduced liquidity, and limitations on our ability to access credit or otherwise raise debt and equity capital. In addition, the United States Federal Reserve has raised, and may again raise, interest rates in response to concerns about inflation. Increases in interest rates, especially if coupled with reduced government spending and volatility in financial markets, may have the effect of further increasing economic uncertainty and heightening these risks, which may impact our ability to raise additional capital in the future. Increased or new restrictions on international trade, such as tariffs, can adversely affect the Company’s operations and supply chain and limit the Company’s ability to offer and sell its products and services to customers. The U.S. and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the military conflicts across multiple regions.

It is not possible to predict the broader or longer-term consequences of these conflicts, which could include further sanctions, embargoes, regional instability, energy shortages, geopolitical shifts and adverse effects on macroeconomic conditions, security conditions, currency exchange rates and financial markets. Such geopolitical instability and uncertainty could have a negative impact on our ability to sell to, ship products to, collect payments from, and support customers in certain regions based on trade restrictions, embargoes and export control law restrictions, and logistics restrictions including closures of air space, and could increase the costs, risks and adverse impacts from these new challenges. We may also be the subject of increased cyber-attacks. While currently the countries involved in these conflicts do not constitute a portion of our business, a significant escalation or expansion of economic disruption or the conflicts’ current scope could have a material adverse effect on our results of operations.

In addition, the risk of cybersecurity incidents has increased in connection with the ongoing war, driven by justifications such as retaliation for the sanctions imposed in conjunction with the war, or in response to certain companies’ continued operations in certain regions. It is possible that these attacks could have collateral effects on additional critical infrastructure and financial institutions globally, which could adversely affect our operations and could increase the frequency and severity of cyber-based attacks against our information technology systems. While we have taken actions to mitigate such potential risks, the proliferation of malware from the war into systems unrelated to the war or cyberattacks against U.S. companies in retaliation for U.S. sanctions against certain regions or U.S. support of certain regions could also adversely affect our operations.

We insure ourselves against many types of risks; however, while this insurance may mitigate certain of the risks associated with general market disruptions, including the risk related to the banking system and the ongoing war across the globe, our level of insurance may not cover all losses we could incur. The potential effects of these conditions could have a material adverse effect on our business, results of operations and financial condition.

War, terrorism, other acts of violence, natural disasters, changing weather conditions, changing circumstances related to potential effects of future epidemics, pandemics, or other health crises, are unpredictable and could adversely affect our business operations and the market for our products.

War, terrorism, other acts of violence or natural or man-made disasters, changing weather conditions, or any epidemic, global pandemic, or other health crises, may affect the markets in which we operate, our customers, our delivery of products and customer service, and could have a material adverse impact on our business, results of operations, or financial conditions.

Our business may be adversely affected by instability, disruption or destruction in a geographic region in which we operate, regardless of cause, including war, terrorism, riot, civil insurrection or social unrest, and natural or man-made disasters or changing weather conditions, including famine, food, fire, earthquake, storm, hurricane, epidemic, pandemic events or other health crises. Such events may cause customers to suspend their decisions on using our products and services, make it impossible to attend or sponsor trade shows or other conferences in which our products and services are presented to customers and potential customers, cause restrictions, postponements and cancellations of events that attract large crowds and public gatherings such as trade shows at which we have historically presented our products, and give rise to sudden significant changes in regional and global economic conditions and cycles that could interfere with purchases of goods or services, commitments to develop new products. These events also pose significant risks to our personnel and to physical facilities, transportation, and operations, which could materially adversely affect our financial results.

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With any such future events or circumstances, there may be a risk related to modification of the traditional classroom setting, similar to what occurred during 2020 to 2021 during the COVID-19 pandemic, when many classrooms were all virtual, that may result in reduced demand for our classroom solutions, including reduced demand for our interactive displays due to extended or indefinite distance and digital learning.

There is also a risk of reduced borrowing with our factoring and purchase order financing facilities, as well as the risk of inability to raise additional capital.

We generate a substantial portion of our revenue from the sale of our display products, and any significant reduction in sales of these products would materially harm our business.

For the year ended December 31, 2025, we generated approximately 71% of our revenues from sales of our interactive display products, consisting of interactive flat-panels and whiteboards. A decrease in demand for our interactive displays would significantly reduce our revenue. If any of our competitors introduces attractive alternatives to our interactive displays, we could experience a significant decrease in sales as customers migrate to those alternative products.

Changes in U.S. administrative policy, including the imposition of or increases in tariffs, changes to existing trade agreements, and any resulting changes in international trade relations, such as trade wars, may have a material adverse impact on our business, results of operations, or financial condition.

In January 2025, the global tariff landscape began to quickly change with the U.S. implementing new and/or increased tariffs on various foreign countries, either generally or with respect to certain products. Certain foreign countries have, and may continue to, change their tariff policies in response to changes in the U.S. tariff policy. Sales outside the US represented 50% of our revenues for the year ended December 31, 2025. In addition, we acquire certain products from OEMs that are manufactured in countries that may be subject to new or increased tariffs, including China. In addition, tariffs could increase the costs of components for those products that we sell and have the potential to disrupt existing supply chains. An increase in the costs of the goods that we sell could make them less affordable for customers, which would negatively impact customer demand and have a material adverse impact on our business, results of operations, or financial condition. It is uncertain whether our OEMs in those countries will pass through increased costs to us, which would result in a negative impact on our business, results of operations, or financial conditions. It is impossible to predict with any certainty the effects that any new tariffs may ultimately have on our industry or our financial condition.

Our business is subject to seasonal fluctuations, which may cause our operating results to fluctuate from quarter-to-quarter and adversely affect our working capital and liquidity throughout the year.

Our revenues and operating results normally fluctuate as a result of seasonal variations in our business, driven largely by the purchasing cycles of the educational market. Traditionally, the bulk of expenditures by school districts occurs in the second and third calendar quarters after receipt of budget allocations. We expect quarterly fluctuations in our revenues and operating results to continue. These fluctuations could result in volatility and adversely affect our cash flow. As our business grows, these seasonal fluctuations may become more pronounced. As a result, we believe that sequential quarterly comparisons of our financial results may not provide an accurate assessment of our financial position.

Our working capital requirements and cash flows are subject to fluctuation, which could have an adverse effect on our financial condition.

Our working capital requirements and cash flows have historically been, and are expected to continue to be, subject to quarterly and yearly fluctuations, depending on a number of factors. Factors which could result in cash flow fluctuations include:

• the level of sales and the related margins on those sales;

• the collection of receivables;

• the timing and size of purchases of inventory and related components; and

• the timing of payment on payables and accrued liabilities.

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If we are unable to manage fluctuations in cash flow, our business, operating results and financial condition may be materially adversely affected. For example, we may be unable to make the required interest payments on our indebtedness.

We operate in a highly competitive industry.

We are engaged in the interactive education industry. We face substantial competition from developers, manufacturers, and distributors of interactive learning products and solutions, including interactive flat-panel displays, interactive whiteboards, micro-computer data logging products, and any new product we may offer in the future. The industry is highly competitive and characterized by frequent product introductions and rapid technological advances that have substantially increased the capabilities and use of interactive flat-panel displays, interactive whiteboards, micro-computer-based logging technologies, and combinations of them. We face increased competition from companies with strong positions in certain markets we serve, and in new markets and regions we may enter. These companies manufacture and/or distribute new, disruptive, or substitute products that compete for the pool of available funds that previously could have been spent on interactive displays and associated products.

Many of these competitors have, and our potential competitors may have, significantly greater financial and other resources than we do and have spent, and may continue to spend, significant amounts of resources to try to enter or expand their presence in the market. In addition, low-cost competitors have appeared in China and other countries. We may not be able to compete effectively against these current and future competitors. Increased competition or other competitive pressures have and may continue to result in price reductions, reduced margins, or loss of market share, any of which could have a material adverse effect on our business, financial condition, or results of operations.

Some of our customers are required to purchase equipment by soliciting proposals from several sources and, in some cases, are required to purchase from the lowest bidder. While we attempt to price our products competitively, based upon the relative features they offer, our competitors’ prices and other factors, we are often not the lowest bidder and, in such cases, may lose sales.

Competitors may be able to respond to new or emerging technologies and changes in customer requirements more effectively and faster than we can or devote greater resources to the development, promotion, and sale of products than we can. Current and potential competitors may establish cooperative relationships among themselves or with third parties, including through mergers or acquisitions, to increase the ability of their products to address the needs of customers. If these interactive display competitors or other substitute or alternative technology competitors acquire significantly increased market share, it could have a material adverse effect on our business, financial condition, or results of operations.

If we are unable to continually enhance our products and to develop, introduce, and sell new technologies and products at competitive prices and in a timely manner, our business will be harmed.

The market for interactive learning and collaboration solutions is still emerging and evolving. It is characterized by rapid technological change and frequent new product introductions, many of which may compete with, be considered as alternatives to or replace our interactive displays. For example, significant sales of tablet computers by competitors to school districts in the U.S., whose technology budgets could otherwise have been used to purchase interactive displays, continue to increase. Accordingly, our future success will depend upon our ability to enhance our products and to develop, introduce, and sell new technologies and products offering enhanced performance and functionality at competitive prices and in a timely manner.

The development of new technologies and products involves time, substantial costs, and risks. Our ability to successfully develop new technologies will depend in large measure on our ability to maintain a technically skilled research and development staff and to adapt to technological changes and advances in the industry. The success of new product introductions depends on a number of factors, including timely and successful product development, market acceptance, the effective management of purchase commitments and inventory levels in line with anticipated product demand, the availability of components in appropriate quantities and costs to meet anticipated demand, the risk that new products may have quality or other defects and our ability to manage distribution and production issues related to new product introductions. If we are unsuccessful in selling the new products that we develop and introduce, or any future products that we may develop, we may carry obsolete inventory and have reduced available working capital for the development of other new technologies and products.

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If we are unable, for any reason, to enhance, develop, introduce, and sell new products in a timely manner, or at all, in response to changing market conditions or customer requirements or otherwise, our business will be harmed.

We may not be successful in our strategy to increase sales in the business and government markets.

The majority of our revenue has been derived from sales to the education market. Our business strategy contemplates expanding our sales in both the education market as well as the business and government training sectors. However, to date, there has been limited adoption of interactive displays and collaboration solutions in the business and government markets, and these solutions may fail to achieve wide acceptance in this market. Successful expansion into the business and government markets will require us to augment and develop new distribution and reseller relationships, and we may not be successful in developing those relationships. In addition, widespread acceptance of our interactive solutions may not occur due to a lack of familiarity with how our products work, the perception that our products are difficult to use and a lack of appreciation of the contribution they can make in the business and government markets. In addition, the Boxlight brands are less recognized in these markets as compared to the education market. A key part of our strategy to grow in the business and government market is to develop strategic alliances with companies in the unified communications and collaboration sector, and there can be no assurance that these alliances will help us to successfully grow our sales in this market.

Furthermore, our ability to successfully grow in the business and government market depends upon revenue and cash flows derived from sales to the education market. As the education market represents a significant portion of our revenue and cash flow, we utilize cash from sales in the education market for our operating expenses. If we cannot continue to augment and develop new distributor and reseller relationships, market our brand, develop strategic alliances, and innovate new technologies, we may not be successful in our strategy to grow in the business and government market.

As a result of market saturation, our future sales of interactive displays in developed markets may slow or decrease.

As a result of the high levels of penetration in developed markets, the education market for interactive displays in the U.S., U.K., and Australia may have reached saturation levels. Future sales growth in those markets and other developed markets with similar penetration levels may, as a result, be difficult to achieve, and our sales of interactive displays may decline in those countries. If we are unable to replace the revenue and earnings, we have historically derived from sales of interactive displays to the education market in these developed markets, whether through sales of additional products, sales in other underserved markets, such as Africa, Latin America, and Asia, sales in the business and government market or otherwise, our business, financial condition and results of operations may be materially adversely affected.

We face significant challenges growing our sales in foreign markets.

For our products to gain broad acceptance in all markets, we may need to develop customized solutions specifically designed for each country in which we seek to grow our sales and to sell those solutions at prices that are competitive in that country. For example, while our hardware requires only minimal modification to be usable in other countries, our software and content require significant customization and modification to adapt to the needs of foreign customers. Specifically, our software will need to be adapted to work in a user-friendly way in several languages and alphabets, and content that fits the specific needs of foreign customers (such as, for example, classroom lessons adapted to specific foreign curricula) will need to be developed. If we are not able to develop, or choose not to support, customized products and solutions for use in a particular country, we may be unable to compete successfully in that country and our sales growth in that country will be adversely affected. We cannot assure you that we will be able to successfully develop or choose to support customized solutions for each foreign country in which we seek to grow our sales or that our solutions, if developed, will be competitive in the relevant country.

Growth in many foreign countries will require us to price our products competitively in those countries. In certain developing countries, we have been and may continue to be required to sell our products at prices significantly below those that we are currently charging in developed countries. Such pricing pressures could reduce our gross margins and adversely affect our revenue.

Our customers’ experience with our products will be directly affected by the availability and quality of our customers’ Internet access. We are unable to control broadband penetration rates, and, to the extent that broadband growth in emerging markets slows, our growth in international markets could be hindered.

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In addition, we will face lengthy and unpredictable sales cycles in foreign markets, particularly in countries with centralized decision-making. In these countries, particularly in connection with significant technology product purchases, we have experienced recurrent requests for proposals, significant delays in the decision-making process and, in some cases, indefinite deferrals of purchases or cancellations of requests for proposals. If we are unable to overcome these challenges, the growth of our sales in these markets would be adversely affected, and we may incur unrecovered marketing costs, impairing our profitability.

Our suppliers may not always be able to supply components or products to us on a timely basis and on favorable terms, and as a result, our dependency on third-party suppliers has adversely affected our revenue and may continue to do so.

We do not manufacture any of the products we sell and distribute and, therefore, rely on our suppliers for all products and components and depend on obtaining adequate supplies of quality components on a timely basis with favorable terms. Some of those components, as well as certain complete products that we sell, are provided to us by only one key supplier or contract manufacturer. We are subject to disruptions in our operations if our sole or limited supply contract manufacturers decrease or stop production of components and products, or if such suppliers and contract manufacturers do not produce components and products of sufficient quantity. Alternative sources for our components are not always available. Many of our products and components are manufactured overseas, so they have long lead times, and events such as local disruptions, natural disasters, or political conflict may cause unexpected interruptions to the supply of our products or components. In addition, we do not have written supply agreements with our suppliers. Although we are endeavoring to enter into written agreements with certain of our suppliers, we cannot assure that our efforts will be successful. Furthermore, the Company may experience materially adverse impacts on its supply chain in the event of sanctions or shipping embargoes caused by any conflict, war, or pandemics.

We rely on highly skilled personnel, and if we are unable to attract, retain, or motivate qualified personnel, we may not be able to operate our business effectively.

Our success depends in large part on the continued employment of senior management and key personnel who can effectively operate our business, as well as our ability to attract and retain skilled employees. Competition for highly skilled management, technical, research and development, and other employees is intense in the high-technology industry, and we may not be able to attract or retain highly qualified personnel in the future. In making employment decisions, particularly in the high-technology industry, job candidates often consider the value of the equity awards they would receive in connection with their employment. Our long-term incentive programs may not be attractive enough or perform sufficiently to attract or retain qualified personnel.

If any of our employees leaves us, and we fail to effectively manage a transition to new personnel, or if we fail to attract and retain qualified and experienced professionals on acceptable terms, our business, financial condition, and results of operations could be adversely affected.

Our success also depends on our having highly trained financial, technical, recruiting, sales, and marketing personnel. We will need to continue to hire additional personnel as our business grows. A shortage in the number of people with these skills or our failure to attract them to our Company could impede our ability to increase revenues from our existing products and services, ensure full compliance with federal and state regulations, or launch new product offerings would have an adverse effect on our business and financial results.

We may have difficulty in entering into and maintaining strategic alliances with third parties.

We have entered into and we may continue to enter into strategic alliances with third parties to gain access to new and innovative technologies and markets. These parties are often large, established companies. Negotiating and performing under these arrangements involves significant time and expense, and we may not have sufficient resources to devote to our strategic alliances, particularly those with companies that have significantly greater financial and other resources than we do. The anticipated benefits of these arrangements may never materialize and performing under these arrangements may adversely affect our results of operations.

We may be unable to successfully complete or manage strategic restructuring to our brand

We continue to position our organization for future growth through the alignment of our brand strategy. Based on the long-term outlook of the industry, we believe our recent initiatives to streamline our brands and unify our go-to-market

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message will position the Company for further success. However, changes to our brand strategy could negatively impact future revenues if not completed successfully.

We use resellers and distributors to promote and sell our products.

Substantially all our sales are made through resellers and distributors. Industry and economic conditions have the potential to weaken the financial position of our resellers and distributors. Such resellers and distributors may no longer sell our products, or may reduce efforts to sell our products, which could materially adversely affect our business, financial condition, and results of operations. Furthermore, if our resellers and distributors’ abilities to repay their credit obligations were to deteriorate and result in the write-down or write-off of such receivables, it would negatively affect our operating results and, if significant, could materially adversely affect our business, financial condition, and results of operations.

In addition, our resellers and most of our distributors are not contractually required to sell our products exclusively and may offer competing interactive display products, and therefore we depend on our ability to establish and develop new relationships and to build on existing relationships with resellers and distributors. We cannot ensure that our resellers and distributors will act in a manner that will promote the success of our products. Factors that are largely within the control of those resellers and distributors but are important to the success of our products include:

• the degree to which our resellers and distributors actively promote our products;

• the extent to which our resellers and distributors offer and promote competitive products; and

• the quality of installation, training, and other support services offered by our resellers and distributors.

In addition, if some of our competitors offer their products to resellers and distributors on more favorable terms or have more products available to meet their needs, there may be pressure on us to reduce the price of our products, or those resellers and distributors may stop carrying our products or de-emphasize the sale of our products in favor of the products of these competitors. If we do not maintain and continue to build relationships with resellers and distributors, our business will be harmed.

If our electronic data is compromised, our business could be significantly harmed.

We and our business partners maintain significant amounts of data electronically in locations around the world. This data relates to all aspects of our business, including current and future products under development, as well as certain customer, consumer, supplier, partner, and employee data. We maintain systems and processes designed to protect this data, but notwithstanding such protective measures, there is a risk of intrusion, cyber-attacks, or tampering that could compromise the integrity and privacy of this data. In addition, we provide confidential and proprietary information to our third-party business partners in certain cases where doing so is necessary to conduct our business. While we obtain assurances from those parties that they have systems and processes in place to protect such data, and where applicable, that they will take steps to assure the protection of such data by third parties, nonetheless those partners may also be subject to data intrusion or otherwise compromise the protection of such data. Any compromise of the confidential data of our customers, consumers, suppliers, partners, employees or ourselves, or failure to prevent or mitigate the loss of or damage to this data through breach of our information technology systems or other means could substantially disrupt our operations, harm our customers, consumers, employees and other business partners, damage our reputation, violate applicable laws and regulations, subject us to potentially significant costs and liabilities and result in a loss of business that could be material.

A failure to keep pace with developments in technology could impair our operations or competitive position.

Our business continues to demand the use of sophisticated systems and technology. These systems and technologies must be refined, updated, and replaced with more advanced systems on a regular basis in order for us to meet our customers’ demands and expectations. If we are unable to do so on a timely basis or within reasonable cost parameters, or if we are unable to appropriately and timely train our employees to operate any of these new systems, our business could suffer. We also may not achieve the benefits that we anticipate from any new system or technology, such as fuel abatement technologies, and a failure to do so could result in higher than anticipated costs or could impair our operating results.

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An information security incident, including a cybersecurity breach, could have a negative impact to the Company’s business or reputation.

To meet business objectives, the Company relies on both internal information technology (IT) systems and networks, and those of third parties and their vendors, to process and store sensitive data, including confidential research, business plans, financial information, intellectual property, and personal data that may be subject to legal protection. The extensive information security and cybersecurity threats, which affect companies globally, pose a risk to the security and availability of these IT systems and networks, and the confidentiality, integrity, and availability of the Company’s sensitive data. The Company continually assesses these threats and makes investments to increase internal protection, detection, and response capabilities, as well as ensure the Company’s third-party providers have the required capabilities and controls to address these risks. To date, the Company has not experienced any material impact on the business or operations resulting from information or cybersecurity attacks; however, because of the frequently changing attack techniques, along with the increased volume and sophistication of the attacks, there is the potential for the Company to be adversely impacted. This impact could result in reputational, competitive, operational, or other business harm as well as financial costs and regulatory action.

Risks Related to Our Industry and Regulations

Decreases in, or stagnation of, spending or changes in the spending policies or budget priorities for government funding of schools, colleges, universities, other education providers, or government agencies may have a material adverse effect on our revenue.

Our customers include primary and secondary schools, colleges, universities, other education providers and, to a lesser extent, government agencies, each of which depends heavily on government funding. Epidemics, pandemics, and other health crises, such as the COVID-19 pandemic, can result in economic recession that could cause a substantial disruption in, decrease or stagnation of, spending and budget priorities for government funding of schools, colleges, universities, and other education providers and government agencies. The economy had only recently experienced a similar disruption from the worldwide recession of 2008 and subsequent sovereign debt and global financial crisis, which resulted in substantial declines in the revenues and fiscal capacity of many national, federal, state, provincial, and local governments. If our products are not a high priority expenditure for such institutions, or if such institutions allocate expenditures to substitute alternative technologies, we could lose revenue.

Any additional decrease in, stagnation of or adverse change in national, federal, state, provincial, or local funding for primary and secondary schools, colleges, universities, or other education providers or for government agencies that use our products could cause our current and prospective customers to further reduce their purchases of our products, which could cause us to lose additional revenue. In addition, a specific reduction in governmental funding support for products such as ours could also cause us to lose revenue.

If our products fail to comply with consumer product or environmental laws, it could materially affect our financial performance.

Because we sell products used by children in classrooms and because our products are subject to environmental regulations in some jurisdictions in which we conduct business and sell our products, we are and will be required to comply with a variety of product safety, product testing and environmental regulations, including compliance with applicable laws and standards with respect to lead content and other child safety and environmental issues. If our products do not meet applicable safety or regulatory standards, we could experience lost sales, diverted resources, and increased costs, which could have a material adverse effect on our financial condition and results of operations. Events that give rise to actual, potential, or perceived product safety or environmental concerns could expose us to government enforcement action or private litigation and result in product recalls and other liabilities. In addition, negative consumer perceptions regarding the safety of our products could cause negative publicity and harm our reputation.

Risks Related to our Foreign Operations

We are subject to risks inherently related to our foreign operations.

Sales outside the US represented 50% of our revenues for the year ended December 31, 2025. We have committed, and may continue to commit, significant resources to our international operations and sales and marketing activities.

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Our significant foreign operations subject us to several risks related to these international business activities that may increase costs, lengthen sales cycles, and require significant management attention. International operations carry certain risks and associated costs, such as the complexities and expense of administering a business abroad, complications in compliance with, and unexpected changes in regulatory requirements, foreign laws, international import and export legislation, trading and investment policies, exchange controls, tariffs and other trade barriers, difficulties in collecting accounts receivable, potential adverse tax consequences, uncertainties of laws, difficulties in protecting, maintaining or enforcing intellectual property rights, difficulty in managing a geographically dispersed workforce in compliance with diverse local laws and customs, and other factors, depending upon the country involved. Moreover, local laws and customs in many countries differ significantly and compliance with the laws of multiple jurisdictions can be complex, difficult, and costly. We cannot ensure that risks inherent in our foreign operations will not have a material adverse effect on our business.

We must comply with the Foreign Corrupt Practices Act.

We are required to comply with the United States Foreign Corrupt Practices Act, which prohibits U.S. companies from engaging in bribery of or other prohibited payments to foreign officials for the purpose of obtaining or retaining business and requires that we maintain adequate financial records and internal controls to prevent such prohibited payments. Our international operations are managed by the Sahara team who are required to comply with the U.K. Bribery Act 2010 which goes further than current U.S. legislation where the Bribery Act is not limited to foreign officials but also includes customers and includes all form of inducement and incentives; the same standard is expected of all our Sahara employees of other European countries where similar legislation is in force under EU-Law Corruption, extortion, bribery, pay-offs, theft and other fraudulent practices may occur in countries where we do business. If our competitors engage in these practices, they may receive preferential treatment from personnel of some companies, giving our competitors an advantage in securing business or from government officials who might give them priority in obtaining new business, which would put us at a disadvantage. If our employees or other agents are found to have engaged in such practices, we could suffer severe penalties.

Our worldwide operations will subject us to income taxation in many jurisdictions, and we must exercise significant judgment to determine our worldwide financial provision for income taxes. That determination ultimately is an estimate, and, accordingly, we cannot assure that our historical income tax provisions and accruals will be adequate.

We are subject to income taxation in the United States and numerous other jurisdictions. Significant judgment is required in determining our worldwide provision for income taxes. In the ordinary course of our business, there are many transactions and calculations where the ultimate tax determination is uncertain. Although we believe our tax estimates are reasonable, we cannot assure you that the final determination of any tax audits and litigation will not be materially different from that which is reflected in our historical income tax provisions and accruals. Should additional taxes be assessed against us as a result of an audit or litigation, there could be a material adverse effect on our current and future results and financial condition.

Certain of our subsidiaries provide products to and may from time to time undertake certain significant transactions with us and our other subsidiaries in different jurisdictions. In general, cross-border transactions between related parties and, in particular, related party financing transactions, are subject to close review by tax authorities. Moreover, several jurisdictions in which we operate have tax laws with detailed transfer pricing rules that require all transactions with nonresident related parties to be priced using arm’s-length pricing principles and require the existence of contemporaneous documentation to support such pricing. A tax authority in one or more jurisdictions could challenge the validity of our related party transfer pricing policies. If in the future any taxation authorities are successful in challenging our financing or transfer pricing policies, our income tax expense may be adversely affected and we could become subject to interest and penalty charges, which may harm our business, financial condition and operating results.

If we are unable to ship and transport components and final products efficiently and economically across long distances and borders, our business would be harmed.

We transport significant volumes of components and finished products across long distances and international borders. Any increases in our transportation costs, as a result of increases in the price of oil or otherwise, would increase our costs and the final prices of our products to our customers. In addition, any increases in customs or tariffs, as a result of changes to existing trade agreements between countries or otherwise, could increase our costs or the final cost of our products to our customers or decrease our margins. Such increases could harm our competitive position and could have a material adverse effect on our business. The laws governing customs and tariffs in many countries are complex and often

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include substantial penalties for non-compliance. Disputes may arise and could subject us to material liabilities and have a material adverse effect on our business.

If our procedures to ensure compliance with export control laws are ineffective, our business could be harmed.

Our extensive foreign operations and sales are subject to far reaching and complex export control laws and regulations in the United States and elsewhere. Violations of those laws and regulations could have material negative consequences for us, including large fines, criminal sanctions, prohibitions on participating in certain transactions, and government contracts, sanctions on other companies if they continue to do business with us and adverse publicity.

We will be exposed to fluctuations in foreign currencies that may materially adversely affect our results of operations.

Our reporting currency is the U.S. dollar. Sahara consolidates results using the British pound (with principal functional currencies in British pound, Euro, and U.S. dollar) and Boxlight Latin America uses the Mexican Peso as functional currency to report revenue and expenses. As a result, we will be exposed to foreign exchange rate fluctuations when we translate the financial statements of our group companies into U.S. dollars in consolidation. If there is a change in foreign currency exchange rates, the translation of any of the group companies’ financial statements into U.S. dollars will lead to a translation gain or loss which is recorded as a component of other comprehensive income. In addition, we may have certain monetary assets and liabilities that are denominated in currencies other than the relevant entity’s functional currency. To the extent the U.S. dollar strengthens or weakens against certain foreign currencies then the translation of foreign currency denominated transactions will result in a change to reported revenue, operating expenses, and net income for subsidiary operations. We have not entered into agreements or purchased instruments to hedge our exchange rate risks, although we may do so in the future. The availability and effectiveness of any hedging transaction may be limited, and we may not be able to successfully hedge our exchange rate risks fully.

We monitor our foreign exchange exposures, and these activities mitigate, but do not eliminate, our exposure to exchange rate fluctuations. As a result, exchange rate fluctuations may materially adversely affect our operating results in future periods.

Unstable market and economic conditions may have serious adverse consequences on our business, financial condition, and results of operations.

The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, and uncertainty about economic stability. Any such volatility and disruptions may have adverse consequences on us or the third parties upon whom we rely.

Risks Related to Our Intellectual Property and Technology

Defects in our products can be difficult to detect before shipment. If defects occur, they could have a material adverse effect on our business.

Our products are highly complex and sophisticated and, from time to time, have contained and may continue to contain design defects or software “bugs” or failures that are difficult to detect and correct in advance of shipping.

The occurrence of errors and defects in our products could result in loss of, or delay in, market acceptance of our products, including harm to our brand. Correcting such errors and failures in our products could require significant expenditure of capital by us. In addition, we are rapidly developing and introducing new products, and new products may have higher rates of errors and defects than our established products. The Boxlight Group has historically provided product warranties, with the average duration being between three and five years, and the failure of our products to operate as described could give rise to warranty claims. The consequences of such errors, failures and other defects and claims could have a material adverse effect on our business, financial condition, results of operations and our reputation.

We may not be able to obtain patents or other intellectual property rights necessary to protect our proprietary technology and business.

Our commercial success depends to a significant degree upon our ability to develop new or improved technologies and products, and to obtain patents or other intellectual property rights or statutory protection for these technologies and

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products in the United States and other countries. We will seek to patent concepts, components, processes, designs, and methods, and other inventions and technologies that we consider have commercial value or that will likely give us a technological advantage. Boxlight owns rights in patents and patent applications for technologies relating to interactive displays and other complementary products in the United States and other countries such as Germany, Mexico, Israel, Japan, Taiwan, and China. Despite devoting resources to the research and development of proprietary technology, we may not be able to develop technology that is patentable or protectable. Patents may not be issued in connection with pending patent applications, and claims allowed may not be sufficient to allow them to use the inventions that they create exclusively. Furthermore, any patents issued could be challenged, re-examined, held invalid or unenforceable or circumvented and may not provide sufficient protection or a competitive advantage. In addition, despite efforts to protect and maintain patents, competitors and other third parties may be able to design around their patents or develop products similar to our products that are not within the scope of their patents. Finally, patents provide certain statutory protection only for a limited period of time that varies depending on the jurisdiction and type of patent. The statutory protection term of certain of our material patents may expire soon and, thereafter, the underlying technology of such patents can be used by any third-party including competitors.

Prosecution and protection of the rights sought in patent applications and patents can be costly and uncertain, often involve complex legal and factual issues, and consume significant time and resources. In addition, the breadth of claims allowed in our patents, their enforceability, and our ability to protect and maintain them cannot be predicted with any certainty. The laws of certain countries may not protect intellectual property rights to the same extent as the laws of the United States. Even if our patents are held to be valid and enforceable in a certain jurisdiction, any legal proceedings that we may initiate against third parties to enforce such patents will likely be expensive, take significant time, and divert management’s attention from other business matters. We cannot assure that any of the issued patents or pending patent applications will provide any protectable, maintainable or enforceable rights or competitive advantages to us.

In addition to patents, we will rely on a combination of copyrights, trademarks, trade secrets and other related laws and confidentiality procedures and contractual provisions to protect, maintain and enforce our proprietary technology and intellectual property rights in the United States, the United Kingdom, Mexico, Australia, Malaysia, Canada, Turkey Sweden, Finland, Germany, Holland, and China. However, our ability to protect our brands by registering certain trademarks may be limited. In addition, while we will generally enter into confidentiality and nondisclosure agreements with our employees, consultants, contract manufacturers, distributors, and resellers and with others to attempt to limit access to and distribution of our proprietary and confidential information, it is possible that:

• misappropriation of our proprietary and confidential information, including technology, will nevertheless occur;

• our confidentiality agreements will not be honored or may be rendered unenforceable;

• third parties will independently develop equivalent, superior or competitive technology or products;

• disputes will arise with our current or future strategic licensees, customers or others concerning the ownership, validity, enforceability, use, patentability or registrability of intellectual property; or

• unauthorized disclosure of our know-how, trade secrets or other proprietary or confidential information will occur.

• we cannot assure that we will be successful in protecting, maintaining, or enforcing our intellectual property rights. If we are unsuccessful in protecting, maintaining, or enforcing our intellectual property rights, then our business, operating results, and financial condition could be materially adversely affected, which could:

• adversely affect our relationships with current or future distributors and resellers of our products;

• adversely affect our reputation with customers;

• be time-consuming and expensive to evaluate and defend;

• cause product shipment delays or stoppages;

• divert management’s attention and resources;

• subject us to significant liabilities and damages;

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• require us to enter into royalty or licensing agreements; or

• require us to cease certain activities, including the sale of products.

If it is determined that we have infringed, violated or are infringing or violating a patent or other intellectual property right of any other person or if we are found liable in respect of any other related claim, then, in addition to being liable for potentially substantial damages, we may be prohibited from developing, using, distributing, selling or commercializing certain of our technologies and products unless we obtain a license from the holder of the patent or other intellectual property right. We cannot assure that we will be able to obtain any such license on a timely basis or on commercially favorable terms, or that any such licenses will be available, or that workarounds will be feasible and cost-efficient. If we do not obtain such a license or find a cost-efficient workaround, our business, operating results and financial condition could be materially adversely affected, and we could be required to cease related business operations in some markets and restructure our business to focus on our continuing operations in other markets.

Our business may suffer if it is alleged or determined that our technology or another aspect of our business infringes the intellectual property of others.

The markets in which we will compete are characterized by the existence of many patents and trade secrets and also by litigation based on allegations of infringement or other violations of intellectual property rights. Moreover, in recent years, individuals and groups have purchased patents and other intellectual property assets for the purpose of making claims of infringement to extract settlements from companies like ours. Also, third parties may make infringement claims against us that relate to technology developed and owned by one of our suppliers for which our suppliers may or may not indemnify us. Even if we are indemnified against such costs, the indemnifying party may be unable to uphold its contractual obligations and determining the extent of such obligations could require additional litigation. Claims of intellectual property infringement against us or our suppliers might require us to redesign our products, enter into costly settlements or license agreements, pay costly damage awards, or face a temporary or permanent injunction prohibiting us from marketing or selling our products or services. If we cannot or do not license the infringed intellectual property on reasonable terms or at all, or substitute similar intellectual property from another source, our revenue and operating results could be adversely impacted. Additionally, our customers and distributors may not purchase our offerings if they are concerned that they may infringe third-party intellectual property rights. Responding to such claims, regardless of their merit, can be time consuming, costly to defend in litigation, divert management’s attention and resources, damage our reputation, and cause us to incur significant expenses. The occurrence of any of these events may have a material adverse effect on our business, financial condition, and operating results.

If we are unable to anticipate consumer preferences and successfully develop attractive products, we might not be able to maintain or increase our revenue or achieve profitability.

Our success depends on our ability to identify and originate product trends as well as to anticipate and react to changing demands and preferences of customers in a timely manner. If we are unable to introduce new products or technologies in a timely manner or our new products or technologies are not accepted by our customers, our competitors may introduce more attractive products, which would adversely impact our competitive position. Failure to respond in a timely manner to changing consumer preferences could lead to, among other things, lower revenues and excess inventory positions of outdated products.

We may be unable to keep pace with changes in technology as our business and market strategy evolves.

We will need to respond to technological advances and emerging industry standards in a cost-effective and timely manner in order to remain competitive. The need to respond to technological changes may require us to make substantial, unanticipated expenditures. There can be no assurance that we will be able to respond successfully to technological change.

Risks Related to Our Class A Common Stock

We may not be able to maintain a listing of our Class A common stock on Nasdaq.

Because our Class A common stock is listed on the Nasdaq Capital Market, we must meet certain financial and liquidity criteria to maintain such listing. From time to time, the Company has been out of compliance with Nasdaq’s listing standards.

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On April 7, 2025, the Company received a letter from Nasdaq notifying the Company that it did not satisfy the continued listing requirements under Nasdaq Listing Rule 5550(b), specifically the requirements that listed companies maintain stockholders’ equity of at least $2.5 million. The Company subsequently submitted a compliance plan to Nasdaq and took steps to remedy the noncompliance, which resulted in Nasdaq confirming on October 8, 2025, that the Company was in compliance with the stockholders’ equity rule. Nasdaq, however indicated that it will continue to monitor the Company’s compliance with the minimum stockholders’ equity requirements and, if at the time of its next periodic report the Company does not comply, the Company may be subject to delisting.

The Company also previously reported, due to director resignations, noncompliance with Nasdaq Rule 5605(c)(2)(A), which requires, among other things, that audit committees have at least three members, of which at least one member have past employment experience in finance or accounting, requisite professional certification in accounting, or any other comparable experience or background which results in the individual’s financial sophistication. The resignations also resulted in the Company not being in compliance with Nasdaq Rule 5605(b)(1), which requires that a majority of the board of directors must be comprised of independent directors as defined in Nasdaq listing standards. The Company was subsequently able to regain compliance with these requirements through the election of new directors, as confirmed by Nasdaq on October 8, 2025.

In addition, the Company has previously not been compliant with Nasdaq Listing Rule 5550(a)(2), which requires that listed companies maintain a minimum closing bid price. The Company resolved that issue with a reverse stock split of its authorized, issued, and outstanding shares of Class A common stock, at a ratio of 1-for-5 which became effective on February 14, 2025. Subsequently, on December 22, 2025, the Company effected another reverse stock split of its authorized, issued, and outstanding shares of Class A common stock, at a ratio of 1-for-6, in order to increase the per-share trading price of its Class A common stock.

While the Company has resolved prior instances of Nasdaq listing noncompliance, and the Company believes, as of the date hereof, that it is in compliance with Nasdaq’s listing standards, the Company’s history of noncompliance could suggest that further incidents of noncompliance could occur in the future.

A delisting of our Class A common stock from Nasdaq may materially impair our stockholders’ ability to buy and sell our Class A common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our Class A common stock. In the event our stock is delisted from Nasdaq, whether by choice or otherwise, the delisting of our Class A common stock could significantly impair our ability to raise capital and stockholder value.

Future sales of our Class A common stock could adversely affect our share price, and any additional capital raised by us through the sale of equity or convertible debt securities may dilute your ownership in our securities and may adversely affect the market price of our Class A common stock.

The development and marketing of new products and the expansion of distribution channels require a significant commitment of resources. From time to time, we may seek additional equity or debt financing to finance working capital requirements, continue our expansion, develop new products, or make acquisitions or other investments. Most recently, on February 19, 2025, we sold, in a private placement, an aggregate of (i) 43,333 shares of Class A common stock, (ii) prefunded warrants to purchase up to an aggregate of 177,167 shares of Class A common stock, and (iii) warrants to purchase up to an aggregate of 220,500 shares of Class A common stock. In addition, if our business plans change, general economic, financial, or political conditions in our industry change, or other circumstances arise that have a material effect on our cash flow, the anticipated cash needs of our business, as well as our conclusions as to the adequacy of our available sources of capital, could change significantly. Any of these events or circumstances could result in significant additional funding needs, requiring us to raise additional capital. If additional funds are raised through the issuance of equity shares, preferred shares, or debt securities, the terms of such securities could impose restrictions on our operations and would reduce the percentage ownership of our existing stockholders. If financing is not available on satisfactory terms, or at all, we may be unable to expand our business or to develop new business at the rate desired and our results of operations may suffer.

In addition, we may from time to time raise capital through an “at the market” equity offering program (“ATM Program”), under which shares of our Class A common stock may be sold into the public market through designated sales agents. Sales under an ATM Program, if any, may occur from time to time depending on market conditions and our capital needs. Any sales of shares of our Class A common stock pursuant to an ATM Program could increase the number of shares of our Class A common stock outstanding and may result in dilution to our existing stockholders. Moreover, the availability of shares for sale under an ATM Program, or the perception that such sales may occur, could adversely affect the market price of our Class A common stock.

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The market price of our Class A common stock may continue to be volatile, which could cause the value of our common stock to fluctuate and possibly decline significantly.

The market price of our Class A common stock may be highly volatile and subject to wide fluctuations. In 2025, the price of our Class A common stock declined from $12.00 on January 2, 2025 to $1.91 per share on December 30, 2025. As of March 26, 2026, our Class A common stock closed at $1.28 per share. In addition, our financial performance, government regulatory action, the imposition of tariffs or trade wars, tax laws, and market conditions in general, and conflicts between Ukraine and Russia, and Israel and Hamas, and their resulting impact on the economy at large, could have a significant impact on the future market price of our Class A common stock. Some of the factors that could negatively affect our share price or result in fluctuations in the price of our common stock include:

• our operating and financial performance and prospects;

• our quarterly or annual earnings or those of other companies in our industry;

• the public’s reaction to our press releases, our other public announcements, and our filings with the SEC;

• changes in, or failure to meet, earnings estimates or recommendations by research analysts who track our Class A common stock or the stock of other companies in our industry;

• the failure of analysts to cover our Class A common stock;

• strategic actions by us or our competitors, such as acquisitions or restructurings;

• announcements by us, our competitors, or our vendors of significant contracts, acquisitions, joint marketing relationships, joint ventures, or capital commitments;

• new laws or regulations or new interpretations of existing laws or regulations applicable to our business;

• changes in accounting standards, policies, guidance, interpretations, or principles;

• announcements by third parties or governmental entities of significant claims or proceedings against us;

• new laws and governmental regulations, or other regulatory developments, applicable to our industry;

• changes in U.S. administrative policy, including the imposition of or increases in tariffs, changes to existing trade agreements, and any resulting changes in international trade relations, such as trade wars;

• changes in general conditions in the United States and global economies or financial markets, including both social and economic conditions resulting from any epidemics, pandemics, or other health crises, and conflicts between Ukraine and Russia, and Israel and Hamas, war, incidents of terrorism, natural disasters, changing weather conditions, or responses to such events;

• continued decreases in government spending levels on education;

• changes in key personnel;

• sales of our common stock by us, members of our management team, or our stockholders;

• the granting or exercise of employee stock options or other equity awards;

• the volume of trading in our Class A common stock; and

• the realization of any risks described in this Item 1A under the caption “Risk Factors”.

Furthermore, the stock market has recently experienced extreme volatility that, in some cases, has been unrelated or disproportionate to the operating performance of particular companies. These broad market and industry fluctuations may adversely affect the market price of our Class A common stock, regardless of our actual operating performance.

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In the past, following periods of market volatility, stockholders have instituted securities class action litigation. If we were involved in securities litigation, it could have a substantial cost and divert resources and the attention of executive management from our business regardless of the outcome of such litigation.

Our Articles of Incorporation, Bylaws, and Nevada law may have anti-takeover effects.

Our Articles of Incorporation authorize the issuance of common stock and preferred stock. Each share of Class A common stock entitles the holder to one vote on all matters to be voted upon by stockholders, and the Class B common stock has no vote, except as required by law. In addition, the Board has the authority to issue additional shares of preferred stock and to determine the price, rights, preferences, privileges, and restrictions of those shares without any further vote or action by the stockholders. The rights of the holders of common stock will be subject to, and may be adversely affected by, the rights of the holders of any preferred stock that may be issued in the future. The ability of our Board to issue additional shares of preferred stock could make it more difficult for a third party to acquire a majority of our voting stock. Other provisions of our Bylaws also may have the effect of discouraging, delaying or preventing a merger, tender offer or proxy contest, which could have an adverse effect on the market price of our Class A common stock.

In addition, certain provisions of Nevada law applicable to our company could also delay or make more difficult a merger, tender offer or proxy contest involving our company, including Sections 78.411 through 78.444 of the Nevada Revised Statutes, which prohibit a Nevada corporation from engaging in any business combination with any “interested stockholder” (as defined in the statute) for a period of two years unless certain conditions are met. In addition, our senior management is entitled to certain payments upon a change in control and certain of the stock options and restricted shares we have granted provide for the acceleration of vesting in the event of a change in control of our Company.

Certain provisions of our outstanding warrants could discourage an acquisition of us by a third party .

On July 22, 2022, we sold, in a registered direct offering, an aggregate of: (i) 29,167 shares of Class A common stock, (ii) prefunded warrants to purchase up to an aggregate of 1,471 shares of Class A common stock, and (iii) common warrants to purchase up to an aggregate of 30,637 shares of Class A common stock. In addition, following our reverse stock split at a ratio of 1-for-5, on February 19, 2025, we sold, in a private placement, an aggregate of (i) 43,333 shares of Class A common stock, (ii) prefunded warrants to purchase up to an aggregate of 177,167 shares of Class A common stock, and (iii) common warrants to purchase up to an aggregate of 220,500 shares of Class A common stock. Certain provisions of our outstanding prefunded warrants and outstanding common warrants could make it more difficult or expensive for a third party to acquire us. Certain of our outstanding warrants provide that, in the event of certain transactions constituting “fundamental transactions” (defined in the warrant forms, but including transactions such as mergers in which the company is not the surviving entity and transactions in which more than 50% of the Company’s voting power is acquired), holders of such warrants will have the right to receive from us or a successor entity upon exercise of the warrant the same type or form of consideration (and in the same proportion) that is being offered and paid to the holders of our Class A common stock in the fundamental transaction.

Additionally, in the event of a fundamental transaction, holders of our privately placed common warrants may instead opt to require us or our successor to purchase the unexercised portion of the common warrants at their “Black Scholes Value” (as described in the common warrant).

These fundamental transaction provisions could prevent or deter a third party from acquiring us, even where the acquisition could be beneficial to the holders of our Class A common stock.

We have no intention of declaring dividends in the foreseeable future.

The decision to pay cash dividends on our Class A common stock rests with our Board and will depend on our earnings, unencumbered cash, capital requirements, and financial condition. We do not anticipate declaring any dividends in the foreseeable future, as we intend to use any excess cash to fund our operations. Investors in our Class A common stock should not expect to receive dividend income on their investment, and investors will be dependent on the appreciation of our Class A common stock to earn a return on their investment.

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If securities or industry analysts do not publish research or reports about us, or if they adversely change their recommendations regarding our Class A common stock, then our stock price and trading volume could decline.

The trading market for our Class A common stock will be influenced by the research and reports that industry or securities analysts publish about us, our industry, and our market. If no analyst elects to cover us and publish research or reports about us, the market for our Class A common stock could be severely limited and our stock price could be adversely affected. In addition, if one or more analysts ceases coverage of us or fails to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. If one or more analysts who elect to cover us adversely change their recommendations regarding our Class A common stock, our stock price could decline.

We may be exposed to risks relating to evaluations of controls required by the Sarbanes-Oxley Act of 2002.

Pursuant to the Sarbanes-Oxley Act of 2002, our management is required to report on the effectiveness of our internal control over financial reporting. Although we prepare our financial statements in accordance with accounting principles generally accepted in the United States, our internal accounting controls may not meet all standards applicable to companies with publicly traded securities. If we fail to implement any required improvements to our disclosure controls and procedures, we may be obligated to report control deficiencies. In either case, we could become subject to regulatory sanction or investigation. Further, these outcomes could damage investor confidence in the accuracy and reliability of our financial statements.

If we fail to develop, implement, and maintain an effective system of internal control over financial reporting, the accuracy and timing of our financial reporting in future periods may be adversely affected.

The Sarbanes-Oxley Act and related rules and regulations require that management report annually on the effectiveness of our internal control over financial reporting and assess the effectiveness of our disclosure controls and procedures on a quarterly basis. Effective internal controls are necessary for us to provide timely and reliable financial reports and effectively prevent fraud. We have identified control deficiencies that constituted a material weakness in our internal controls and procedures in the past and may experience a material weakness in future years. If we fail to maintain adequate internal controls, our financial statements may not accurately reflect our financial condition. Any material misstatements could require a restatement of our consolidated financial statements, cause us to fail to meet our reporting obligations or cause investors to lose confidence in our reported financial information, leading to a decline in the market value of our securities.

Unstable market and economic conditions and potential disruptions in the credit markets may adversely affect our business, including the availability and cost of short-term funds for liquidity requirements and our ability to meet long-term commitments, which could adversely affect our results of operations, cash flows, and financial condition.

If internally generated funds are not available from operations, we may be required to rely on the banking and credit markets to meet our financial commitments and short-term liquidity needs. Our access to funds under our revolving credit facility or pursuant to arrangements with other financial institutions is dependent on the financial institution’s ability to meet funding commitments. Financial institutions may not be able to meet their funding commitments if they experience shortages of capital and liquidity or if they experience high volumes of borrowing requests from other borrowers within a short period of time.

In addition, the global credit and financial markets have recently experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, inflationary pressure, interest rate changes, and uncertainty about economic stability. More recently, the closures of Silicon Valley Bank, Signature Bank, and First Republic Bank and their placement into receivership with the Federal Deposit Insurance Corporation (FDIC) created bank-specific and broader financial institution liquidity risk and concerns. Future adverse developments with respect to specific financial institutions or the broader financial services industry may lead to market-wide liquidity shortages, impair the ability of companies to access near-term working capital needs, and create additional market and economic uncertainty. There can be no assurance that future credit and financial market instability and a deterioration in confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any such economic downturn, liquidity shortages, volatile business environment, or continued unpredictable and unstable market conditions. If the equity and credit markets deteriorate, or if adverse developments are experienced by financial institutions, it may cause short-term liquidity risk and also make any necessary debt or equity financing more difficult, more costly, and more dilutive. Failure to secure any necessary financing in a timely manner and

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on favorable terms could have a material adverse effect on our growth strategy, financial performance, and stock price and could require us to delay or abandon clinical development plans. In addition, there is a risk that one or more of our current service providers, financial institutions, manufacturers, and other partners may be adversely affected by the foregoing risks, which could directly affect our ability to attain our operating goals on schedule and on budget.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management’s Discussion and Analysis ("MD&A") should be read in conjunction with our financial statements and the related notes thereto included elsewhere herein. MD&A contains forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations, and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect,” and the like, and/or future-tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements in this Annual Report. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors.

Historical results may not indicate future performance. Our forward-looking statements reflect our current views about future events, are based on assumptions, and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. We undertake no obligation to publicly update or revise any forward-looking statements, including any changes that might result from any facts, events, or circumstances after the date hereof that may bear upon forward-looking statements. Furthermore, we cannot guarantee future results, events, levels of activity, performance, or achievements.

Overview

We are a technology company that develops, sells, and services interactive solutions predominantly for the global education market, but also for the corporate and government sectors. We are seeking to become a worldwide leading innovator and integrator of interactive products and software solutions and improve collaboration and effective communication in meeting environments. We currently design, produce, and distribute interactive technologies including our interactive and non-interactive flat-panel displays, LED video walls, media players, classroom audio and campus communication, cameras, and other peripherals for the education market and non-interactive solutions including flat-panels, LED video walls, and digital signage. We also distribute STEM products, including our 3D printing and robotics solutions, and our portable science lab. All products are integrated into our classroom software suite that provides tools for whole class learning, assessment, and collaboration. In addition, we offer professional training services related to our technology to our U.S. educational customers. To date, we have generated the majority of our revenue in the U.S. and internationally from the sale of interactive displays and related software to the educational market. We have sold our solutions into over 70 countries and into over 1.5 million classrooms and meeting spaces. We sell our products and software through more than 1,000 global reseller partners. We believe we offer the most comprehensive and integrated line of interactive display solutions, audio products, peripherals and accessories, software, and professional development for schools and enterprises on the market today. The majority of our products are backed by nearly 30 years of research and development.

Advances in technology and new options for the introduction of technology into the classroom have forced school districts to look for solutions that allow teachers and students to bring their own devices into the classroom, provide school districts with information technology departments with the means to access data with or without internet access, handle

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higher demand for video, as well as control cloud and data storage challenges. Our design teams are able to quickly customize systems and configurations to serve the needs of clients so that existing hardware and software platforms can communicate with one another. Our goal is to become a single source solution to satisfy the needs of educators around the globe and provide a holistic approach to the modern classroom.

Components of our Results of Operations and Financial Condition

Revenue

The Company’s sales of interactive devices, including panels, whiteboards, and other interactive devices generally include hardware maintenance services, a license to use software, and the provision of related software maintenance. In most cases, interactive devices are sold with hardware maintenance services.

The Company’s installation, training, and professional development services include third-party products and services and are generally sold separately from the Company’s products.

Cost of revenue

Our cost of revenue is comprised of the following:

• third-party logistics costs;

• costs to purchase components and finished goods directly;

• inbound and outbound freight costs and duties;

• costs associated with the repair of products under warranty;

• write-downs of inventory carrying value to adjust for excess and obsolete inventory and periodic physical inventory counts;

• cost of professionals to deliver the professional development training; and

• customs expense.

We outsource some of our warehouse operations and order fulfillment, and we purchase products from related entities and third parties. Our product costs vary directly with volume and are based on the costs of underlying product components as well as the prices we negotiate with our contract manufacturers. Shipping costs fluctuate with volume as well as with the method of shipping chosen in order to meet customer demand. As a global company with suppliers centered in Asia and customers located worldwide, we have used, and may in the future use, air shipping to deliver our products directly to our customers. Air shipping is more costly than sea or ground shipping or other delivery options and it is rarely used as a result. The Company did not experience material delays in shipping during 2025 or 2024 that materially negatively impacted our revenues.

Gross profit and gross profit margin

Our gross profit and gross profit margin have been, and may in the future be, influenced by several factors including: product, channel, and geographical revenue mix; changes in product costs related to the release of newer models; component, contract manufacturing and supplier pricing, freight, duties, and other shipping costs, and foreign currency exchange. As we primarily procure our product components and manufacture our products in Asia, our suppliers incur many costs, including labor costs, in other currencies. To the extent that exchange rates move unfavorably for our suppliers, they may seek to pass these additional costs on to us, which could have a material impact on our future average selling prices and unit costs. Gross profit and gross profit margin may fluctuate over time based on the factors described above.

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Operating expenses

We classify our operating expenses into three categories: general and administrative, depreciation and amortization, and research and development.

General and administrative . General and administrative expense consists of personnel-related costs, which include salaries, commissions, and stock-based compensation, as well as the costs of professional services, such as accounting and legal, facilities, information technology, and other administrative expenses. General and administrative expense may fluctuate as a percentage of revenue, notably in the second and third quarters of our fiscal year when we have historically experienced our highest levels of revenue.

Depreciation and amortization . Depreciation and amortization expense consists of depreciation of our property and equipment and amortization of our intangible assets.

Research and development . Research and development expense consists primarily of personnel-related costs, prototype and sample costs, design costs, and global product certifications, mostly for wireless certifications.

Other income (expense), net

Other (expense) income, net, primarily consists of interest expense associated with our debt financing arrangements, certain impacts of changes in foreign exchange rates, and the effects of changes in the fair value of derivative liabilities and changes in the fair value of warrants.

Income tax expense

We are subject to income taxes in the United States, Canada, the United Kingdom, Mexico, Sweden, Finland, Holland, Australia, Denmark, and Germany, where we do business. The United Kingdom, Mexico, Sweden, Finland, Holland, Germany, Australia, Canada, and Denmark have a statutory tax rate different from that in the United States. Additionally, certain of our international earnings are also taxable in the United States. Accordingly, our effective tax rates will vary depending on the relative proportion of foreign to U.S. income, the absorption of foreign tax credits, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws. We regularly assess the likelihood of adverse outcomes resulting from the examination of our tax returns by the U.S. Internal Revenue Service, or IRS, and other tax authorities to determine the adequacy of our income tax reserves and expenses. Should actual events or results differ from our current expectations, charges or credits to our income tax expense may become necessary. Any such adjustments could have a significant impact on our results of operations.

Operating Results

For the years ended December 31, 2025, and 2024

Revenues. Total revenues for the year ended December 31, 2025 were $109.2 million as compared to $135.9 million for the year ended December 31, 2024, resulting in a 19.6% decrease. The decrease in revenues was due to lower sales volume across all markets, primarily resulting from lower global demand for interactive flat panel displays as well as competitive industry pricing.

Cost of Revenues. Cost of revenues for the year ended December 31, 2025 was $75.6 million as compared to $89.0 million for the year ended December 31, 2024, resulting in a 15.0% decrease. The decrease in cost of revenues was attributable to the decrease in units sold, offset by increases in tariffs expense.

Gross Profit . Gross profit for the year ended December 31, 2025 was $33.6 million as compared to $46.9 million for the year ended December 31, 2024. Gross profit margin declined to 30.8% for the year ended December 31, 2025 compared to 34.5% for the year ended December 31, 2024, primarily related to changes in the product mix, increases in pricing pressure within the industry, and the impact of a $1.5 million increase in tariffs on the cost of our products compared to the prior year.

General and Administrative Expense. General and administrative expense for the year ended December 31, 2025 was $35.5 million and 32.5% of revenue, as compared to $41.8 million and 30.7% of revenue for the year ended December 31, 2024. The decrease was primarily related to a decrease in personnel-related expenses of approximately $4.2

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million, a reduction in sales and marketing expenses of approximately $1.3 million, and a decrease in professional fees of approximately $0.6 million.

Depreciation and Amortization Expenses. Depreciation and amortization expenses for the year ended December 31, 2025 were $10.3 million, representing 9.4% o f revenue as compared to $20.5 million re presenting 15.1% of revenue for the year ended December 31, 2024. The decrease in de preciation and amortization expenses for the year ended December 31, 2025 was primarily related to the $12.3 million accelerated amortization expense in the year ended December 31, 2024.

Research and Development Expense. Research and development expense was $4.3 million or 3.9% of revenue for the year ended December 31, 2025, as compared to $4.1 million or 3.0% of revenue for the year ended December 31, 2024 . Research and development expense primarily consists of costs associated with the development of proprietary technology. The increase was attributable to the allocation of certain general and administrative expenses to new and ongoing research and development projects.

Other Expense, net. Other expense for the year ended December 31, 2025 was $8.4 million as compared to $10.8 million for the year ended December 31, 2024. Other expense consists primarily of interest expense on our term loan.

Net Loss. Net loss attributable to common shareholders was $25.1 million and $29.6 million for the years ended December 31, 2025, and 2024, respectively, after deducting fixed dividends to Series B preferred shareholders of $1.3 million in each year.

To provide investors with additional insight and allow for a more comprehensive understanding of the information used by management in its financial and decision-making surrounding operations, we supplement our consolidated financial statements presented on a basis consistent with U.S. generally accepted accounting principles (“GAAP”) with EBITDA and Adjusted EBITDA, both non-GAAP financial measures of earnings.

EBITDA represents net loss before income tax expense, interest expense, net, and depreciation and amortization expense. Adjusted EBITDA represents EBITDA, adjusted for stock compensation expense and changes in fair value of derivative liabilities, purchase accounting impact for fair valuing inventory and deferred revenue, impairment of goodwill, and severance charges. Our management uses EBITDA and Adjusted EBITDA as financial measures to evaluate the profitability and efficiency of our business model. We use these non-GAAP financial measures to assess the strength of the underlying operations of our business. These adjustments, and the non-GAAP financial measure that is derived from them, provide supplemental information to analyze our operations between periods and over time. We find this especially useful when reviewing results of operations, which include large non-cash amortizations of intangible assets from acquisitions. Investors should consider our non-GAAP financial measures in addition to, and not as a substitute for, financial measures prepared in accordance with GAAP.

The following table contains reconciliations of net losses to EBITDA and adjusted EBITDA for the periods presented.

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Reconciliation of net loss for the years ended

December 31, 2025 and 2024 to EBITDA and Adjusted EBITDA

(in thousands)

Net loss

Depreciation and amortization

Interest expense

Income tax (benefit)

EBITDA

Stock compensation expense

Change in fair value of derivative liabilities

Change in fair value of related party derivative liabilities

Change in fair value of common warrants

Loss on warrant issuance

Purchase accounting impact of fair valuing inventory

Purchase accounting impact of fair valuing deferred revenue

Severance charges

Adjusted EBITDA

Discussion of the Effect of Seasonality on Financial Condition

Certain accounts on our balance sheets are subject to seasonal fluctuations. As our business and revenues grow, we expect these seasonal trends to be reduced. The bulk of our products are shipped to our educational customers prior to the beginning of the school year, usually in July, August, or September. To prepare for the upcoming school year, we generally build up inventories during the second quarter of the year. Therefore, inventories tend to be at the highest levels at that point in time. In the first quarter of the year, inventories tend to decline significantly as products are delivered to customers and we do not need the same inventory levels during the first quarter. Accounts receivable balances tend to be at the highest levels in the third quarter, in which we record the highest level of sales.

We have been very proactive, and will continue to be proactive, in obtaining contracts during the fourth and first quarters of each year in order to help offset the seasonality of our business.

Liquidity and Capital Resources

Credit Agreement Amendments and Covenant Relief

As of December 31, 2025, we had cash and cash equivalents of $9.4 million, a working capital balance of $26.6 million, and a current ratio of 1.62. At December 31, 2024, we had $8.0 million of cash and cash equivalents, a working capital balance of $1.3 million, and a current ratio of 1.02.

For the years ended December 31, 2025 and 2024, we had net cash used in operating activities of $3.3 million and $0.4 million, respectively. Cash used in operating activities increased year over year as a result of a change in working capital management. We had net cash used in investing activities of $0.1 million and $0.5 million for the years ended December 31, 2025 and 2024, respectively. Cash used in investing activities is primarily related to purchases of property and equipment. For the years ended December 31, 2025 and 2024, we had net cash provided by financing activities of $3.4 million and net cash used in financing activities of $7.1 million, respectively. Cash provided by financing activities for the year ended December 31, 2025 was primarily related to net proceeds from the issuance of common stock and prefunded warrants of $9.0 million and proceeds from the issuance of short-term debt of $2.5 million, partially offset by $8.1 million in principal payments. Cash used in financing activities for the year ended December 31, 2024 was primarily related to principal payments on debt of $9.9 million and $1.3 million in payments of fixed dividends to our Series B preferred shareholders, partially offset by $4.0 million proceeds from short-term debt.

Our liquidity needs are funded by operating cash flow and available cash. Our cash requirements consist primarily of day-to-day operating expenses, capital expenditures, and contractual obligations with respect to facility leases. We lease

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all of our office facilities. We expect to make future payments on existing leases from cash generated from operations. We have limited credit available from our major vendors and are required to prepay a percentage of our inventory purchases, which further constrains our cash liquidity. In addition, our industry is seasonal with many sales to educational customers occurring during the second and third quarters when schools make budget appropriations and classes are not in session, limiting disruptions related to product installation. This seasonality makes our needs for cash vary significantly from quarter to quarter.

As of December 31, 2025, the Company had approximately $32.2 million of indebtedness outstanding under its Credit Agreement with Whitehawk Capital Partners, LP, as Collateral Agent, and Whitehawk Finance LLC, as Lender.

During the fiscal year ended December 31, 2025, the Company entered into the Eighth, Ninth, Tenth, and Eleventh Amendments to the Credit Agreement (collectively, the “2025 Amendments”) to address prior instances of non-compliance with certain financial covenants and to restructure key terms of the facility. In particular, the Company had not maintained compliance with the Senior Leverage Ratio and borrowing base covenants at various measurement dates during 2025. The Lender waived each of these events of default in connection with the respective amendments.

Most significantly, on December 18, 2025, the Company entered into the Eleventh Amendment. The Eleventh Amendment extended the final maturity date of the loans from December 31, 2025, to April 1, 2027, suspended mandatory quarterly amortization payments through June 30, 2026, and replaced the Senior Leverage Ratio financial covenant with a Minimum Consolidated Adjusted EBITDA covenant commencing with the quarter ending March 31, 2026. The Company is also required to maintain qualified cash of at least $1.5 million The Company is also required to meet Borrowing Base covenants with allowed over advances of for the month ending December 31, 2025, $4,000,000; for the month ending January 31, 2026, $4,500,000; for the month ending February 28, 2026, $5,500,000 and (from and after the month ending March 31, 2026 (and each Fiscal Month thereafter), $4,000,000 (the “Permitted Over Advance”). The Eleventh Amendment includes revised mandatory prepayment provisions requiring 50% (or 100% if in default) of net cash proceeds from equity offerings and certain debt to be applied to loan prepayments, with up to $5.0 million allocable for working capital and general corporate purposes.

Capital Raise

In September 2025, the Company completed a registered direct offering of 222,222 shares of Class A common stock at $18.00 per share, generating approximately $4.0 million in gross proceeds. Net proceeds were used for working capital and debt reduction pursuant to the Company’s agreement with its senior lender. This offering was conducted through the Company’s effective shelf registration statement on Form S-3.

In December 2025 and until exhaustion of the “at the market” equity offering program (“ATM Program”) in January 2026 the Company has shown the ability to raise capital to fund operations. Past success is not indicative of future results and the Company has evaluated the going concern consideration as such.

Tariff Environment

On February 20, 2026, the Supreme Court of the United States ruled that the International Emergency Economic Powers Act (“IEEPA”) does not authorize the imposition of tariffs, effectively invalidating IEEPA-based tariffs that had been in effect since February 2025. The Company’s diversified supply chain and global revenue base have historically provided a degree of insulation from direct tariff impacts. The elimination of these tariffs is expected to reduce input cost pressures and improve the purchasing environment for the Company’s education and government customers, and may result in refund recoveries for IEEPA tariffs previously paid by the Company or its suppliers during the applicable period. The tariff environment is in a state of flux and the Company is actively pursuing refund recovery activities as further clarity is provided by the Court of International Trade and the US Customs and Border Protection releases the process for recovery.

Going Concern Assessment

The Company has evaluated conditions and events, in the aggregate, that may raise doubt about its ability to continue as a going concern within one year after the date these financial statements are issued, in accordance with ASC 205-40.

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The Company acknowledges that it has a history of operating losses, has incurred recurring negative cash flows from operations, and has required multiple amendments and waivers under its Credit Agreement due to non-compliance with financial covenants in prior periods. The Company acknowledges it is a reasonable concern that compliance will be maintained at all future measurement dates.

Management believes that the following factors provide potential upside to help alleviate cash restrictions over the next year:

• The extension of the Credit Agreement maturity to April 1, 2027, pursuant to the Eleventh Amendment, eliminates the near-term risk of debt maturity acceleration and provides the Company with an extended runway within which to execute its operational and any recapitalization, if necessary, plans;

• The replacement of the Senior Leverage Ratio covenant with the Minimum Consolidated Adjusted EBITDA covenant establishes a financial compliance framework that management believes is more achievable based on the Company’s current and projected operating performance;

• The suspension of mandatory quarterly amortization payments through June 30, 2026, provides near-term cash flow relief;

• The September 2025 capital raise of approximately $4.0 million in gross proceeds demonstrated continued access to the equity capital markets and provided additional liquidity;

• The invalidation of IEEPA tariffs by the Supreme Court in February 2026 reduces supply chain cost pressures seen during 2025 and provides for a non-insignificant, cash injection into the Company in 2026; and

• Management’s continued focus on operational efficiency, expense reduction, and revenue diversification into the corporate and government markets as well expansion as with a new product offering coming to market in 2026.

Notwithstanding the foregoing, there is substantial doubt as to the Company’s ability to continue as a going concern as the Company is dependent upon its ability to maintain compliance with the financial covenants under the Credit Agreement as amended, achieve positive cash flow from operations, and, if necessary, access additional financing. There can be no assurance that the Company will be successful in maintaining compliance with its financial covenants, achieving profitability, or raising additional capital on acceptable terms or at all. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Preferred Stock and Capital Structure Considerations

To the extent not previously converted into the Company’s Class A common stock, the outstanding shares of our Series B preferred stock became redeemable at the option of the holders at any time or from time to time commencing on January 1, 2024 upon, 30 days’ prior written notice to the Company, for a redemption price, payable in cash, equal to the sum of (a) ($10.00) multiplied by the number of shares of Series B preferred stock being redeemed (the “Redeemed Shares”), plus (b) all accrued and unpaid dividends, if any, on such Redeemed Shares. We may be required to seek alternative financing arrangements or restructure the terms of the agreement with the Series B preferred shareholders on terms that are not favorable to us if cash and cash equivalents are not sufficient to fully redeem the Series B preferred shares. We are currently evaluating alternatives to refinance or restructure the Series B preferred shares, including extending the maturity of the Series B preferred shares beyond the current optional conversion date.

On February 20, 2025, we filed with the Secretary of State of the State of Nevada (i) an Amendment to the Certificate of Designation of our Series B Preferred Stock (the “Series B Amendment”) and (ii) an Amendment to the Certificate of Designation of our Series C Preferred Stock (the “Series C Amendment” and, together with the Series B Amendment, the “Amendments”). Each Amendment was approved by the holders of a majority of the outstanding shares of Series B Preferred Stock or Series C Preferred Stock, as applicable, in accordance with the applicable Certificate of Designation. Pursuant to the Amendments, neither the Series B Preferred Stock nor the Series C Preferred Stock shall be convertible into Class A Common Stock until the earlier of (1) the effectiveness of an amendment to the articles of incorporation of the Company increasing the number of shares of authorized Class A Common Stock to at least 25,000,000 shares (subject to adjustments as set forth therein) and (2) August 19, 2025.

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On October 1, 2025, the Company converted all outstanding Series C preferred stock into common stock and amended the Series B preferred stock to eliminate redemption and conversion features, reducing potential future cash obligations.

At-the-Market Offering (“ATM Program”)

During the year ended December 31, 2025, the Company raised approximately $0.66 million of net proceeds through sales of its Class A Common Stock under its “at the market” offering program (“ATM Program”). The proceeds were used for working capital and general operating purposes. See Note 12 – Stockholders’ Equity to the consolidated financial statements for additional information regarding the Company’s ATM program.

Given the uncertainty surrounding global supply chains, global markets, and general global uncertainty as a result of new U.S. tariff policy, trade wars, and the ongoing and widespread conflicts across multiple regions , the availability of debt and equity capital has been reduced and the cost of capital has increased. Furthermore, recent adverse developments affecting the financial services industry including events involving limited liquidity, defaults, non-performance, or other adverse developments that affect financial institutions may lead to market-wide liquidity problems. This in turn could result in a reduction in our ability to access funding sources and credit arrangements in amounts adequate to finance our current and future business operations. Increasing our capital through equity issuance at this time could cause significant dilution to our existing stockholders. However, there can be no guarantee we will be able to access capital when needed or be able to manage through the current challenges in the equity and debt finance markets by managing payment terms with our customers and vendors.

Cash and cash equivalents, along with anticipated cash flows from operations, may not provide sufficient liquidity for our working capital needs, debt service requirements, or to maintain minimum liquidity requirements under our Credit Agreement, and we may need to raise capital to meet current working capital requirements including maintaining sufficient inventory levels to meet future sales demand.

Inventory Financing Agreement

On November 3, 2025, we entered into an amended and restated inventory finance agreement with J.J. Astor & Co. (the “Inventory Purchaser”), pursuant to which the Inventory Purchaser may, from time to time, finance up to $9.0 million of our finished goods inventory purchases from our contract manufacturers. Under this arrangement, we are required to pay a deposit equal to 20% of the purchase price of the applicable inventory, and the Inventory Purchaser funds the remaining balance directly to the supplier and takes title to the inventory.

We have determined that this arrangement results in the recognition of the financed inventory and a corresponding financing obligation on our consolidated balance sheets, as the risks and rewards of ownership are substantially retained by us during the financing period. Accordingly, financed inventory is included within inventories, net of reserves, and the related payment obligations are presented as related party accounts payable on our consolidated balance sheets.

For each inventory purchase financed under the agreement, we are obligated to pay the Inventory Purchaser an amount equal to the funded purchase amount plus a contractual premium within 90 days of the funding date. The agreement also requires us to pay monthly monitoring fees and provides for additional fees based on unused financing availability. In the event we fail to satisfy our payment obligations when due, the Inventory Purchaser may accelerate amounts owed, impose default interest and penalties, and sell the inventory collateral. We would remain liable for any deficiency resulting from such sale.

The agreement further provides the Inventory Purchaser with the right, at its election, to convert certain outstanding payment obligations into shares of our Class A common stock, subject to ownership limitations and other contractual restrictions.

As of December 31, 2025, the aggregate outstanding obligation under this arrangement was $3.7 million, recorded as related party accounts payable on our consolidated balance sheet. This arrangement represents a form of short-term inventory financing and exposes us to material liquidity, cash flow, and operational risks.

On April 1, 2026, we entered into an amendment to the inventory finance agreement, pursuant to which $556,200 of the outstanding balance was converted into 600,000 shares of common stock (the “Conversion Shares”) at a conversion price of $0.927 per share. Further, the parties agreed that, if the aggregate proceeds from the sale of the Conversion Shares are less than $556,200, the Company shall pay the shortfall in cash within five trading days. Michael Pope, Chairman of

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the Company’s Board of Directors, and its former president and chief executive officer, is the chief executive officer of J.J. Astor. J.J. Astor is beneficially owned, directly or indirectly, by a private investment fund managed by Mr. Pope.

Additional information regarding this inventory financing arrangement is included in Note 15 - Commitments and Contingencies to our consolidated financial statements.

Recent Financing

See Note 9 to the consolidated financial statements.

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with generally accepted accounting principles accepted in the United States. In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures. We base our assumptions, estimates, and judgments on historical experience, current trends, and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates, and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Our significant accounting policies are discussed in detail in Note 1 to the accompanying consolidated financial statements, and briefly summarized below. We believe that the following accounting estimates are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective, or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain :

1. Revenue Recognition

2. Inventory Reserve

3. Goodwill and Intangible Assets

4. Share-based Compensation

5. Derivative Warrant Liabilities

6. Income Taxes

REVENUE RECOGNITION

In accordance with the FASB’s Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers) (“Topic 606”), the Company recognizes revenue at the amount to which it expects to be entitled when control of the products or services is transferred to its customers. Control is generally transferred when the Company has a present right to payment and the significant risks and rewards of ownership of products or services are transferred to its customers. Product revenue is derived from the sale of interactive panels, audio and communication equipment, and related software and accessories to distributors, resellers, and end users. Service revenue is derived from hardware maintenance services, product installation, training, software maintenance, and subscription services.

The Company’s sales of interactive devices, including panels, whiteboards, audio and communication equipment, and other interactive devices generally include hardware maintenance services, a license to software, and the provision of related software maintenance. Interactive devices are generally sold with hardware maintenance services with terms ranging from 36-60 months. Software maintenance includes technical support, product updates on a when and if available basis, and error correction services. At times, non-interactive projectors are also sold with hardware maintenance services with terms ranging from 36-60 months. The Company also licenses software independently of its interactive devices, in which case it is bundled with software maintenance, and in some cases, subscription services that include access to online content, access to replacement parts, and cloud-based applications. The Company’s software subscription services provide

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access to content and software applications on an as needed basis over the Internet, but do not provide the right to take delivery of the software applications.

The Company’s product sales, including those with software and related services, generally include a single payment up front for the products and services, and revenue is recorded net of estimated sales returns and rebates based on the Company’s expectations and historical experience. For most of the Company’s product sales, control transfers, and therefore, revenue is recognized when products are shipped at the point of origin. When the Company transfers control of its products to the customer prior to the related shipping and handling activities, the Company has adopted a policy of accounting for shipping and handling activities as a fulfillment cost rather than a performance obligation. For other software product sales, control is transferred when the customer receives the related access code or interactive hardware, since the customer’s access code or connection to the interactive hardware activates the software license at which time the software is made available to the customer. For the Company’s software maintenance, hardware maintenance, and subscription services, revenue is recognized ratably over time as the services are provided, since time is the best output measure of how those services are transferred to the customer.

The Company’s installation, training, and professional development services are generally sold separately from the Company’s products. Control of these services is transferred to our customers over time with hours/time incurred in providing the service being the best depiction of the transfer of services since the customer is receiving the benefit of the services as the work is performed.

For contracts with multiple performance obligations, each of which represents promises within a contract that are distinct, the Company allocates revenue to all distinct performance obligations based on their relative stand-alone selling prices (“SSPs”).

INVENTORY RESERVE

Inventories are stated at the lower of cost or net realizable value and include spare parts and finished goods. Inventories are primarily determined using specific identification and the first-in, first-out (“FIFO”) cost methods. Cost includes direct cost from the Contract Manufacturer (“CM”) or Original Equipment Manufacturer (“OEM”), plus material overhead related to the purchase, inbound freight, and import duty costs.

We continuously review our inventory levels to identify slow-moving merchandise and markdowns necessary to clear slow-moving merchandise, which reduces the cost of inventories to its estimated net realizable value. Consideration is given to several quantitative and qualitative factors, including current pricing levels and the anticipated need for subsequent markdowns, aging of inventories, historical sales trends, and the impact of market trends and economic conditions. Estimates of markdown requirements may differ from actual results due to changes in quantity, quality, and mix of products in inventory, as well as changes in consumer preferences, market and economic conditions.

As of December 31, 2025 and December 31, 2024, our reserve for inventory obsolescence was $2.5 million and $3.2 million, respectively.

GOODWILL AND INTANGIBLE ASSETS

Goodwill represents the cost in excess of the fair value of the net assets of acquired businesses. Goodwill is not amortized and is not deductible for tax purposes. Under ASC Topic 350 “ Business Combinations ,” we have an option to perform a “qualitative” assessment of the Company to determine whether further impairment testing is necessary. If an entity believes, as a result of its qualitative assessment, that it is more-likely-than-not that the fair value of the business is less than the carrying amount, the quantitative impairment test is required. Otherwise, no further testing is required. If we determine that the Company meets these criteria, we perform a qualitative assessment. In this qualitative assessment, we consider the following items: macroeconomic conditions, industry and market conditions, overall financial performance, and other entity specific events. In addition, we assess whether the most recent fair value determination results in an amount that exceeds the carrying amount of the Company. Based on these assessments, we determine whether the likelihood that a current fair value determination would be less than the current carrying amount is not more likely than not.

During the year ended December 31, 2023, the Company identified multiple triggering events, including declines in market capitalization, changes in reporting units, and deteriorating industry conditions, and performed interim goodwill

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impairment testing. As a result of these tests, the Company recorded goodwill impairment charges that fully eliminated the goodwill balances of its Americas and EMEA reporting units.

As of December 31, 2025, the Company had no remaining goodwill, and therefore no goodwill impairment testing was required during the year ended December 31, 2025.

Intangible assets are amortized using the straight-line method over their estimated period of benefit. We evaluate the recoverability of intangible assets periodically and take into account events or circumstances that warrant revised estimates of useful lives or that indicate that impairment exists. Intangible assets are assessed for impairment if indicators of potential impairment exist using an undiscounted cash-flow approach.

During the year ended December 31, 2024, due to triggering events, the Company performed intangible testing as of September 30, and December 31, 2024.

As of September 30, 2024, the Company determined that a triggering event had occurred as a result of a decline in the Company’s revenues resulting from lower sales volume, primarily resulting from lower global demand for interactive flat panel displays. As a result, the Company performed an interim impairment test on its finite-lived intangible assets using undiscounted cash flows. Based on the results of our interim test as of September 30, 2024, we concluded that the estimated undiscounted cash flows exceeded the respective carrying value and, as such, we concluded that the intangible assets assigned to each reporting unit, as of September 30, 2024, were not impaired.

As of December 31, 2024, the Company performed intangible impairment testing as a result of another triggering event identified due to further declines in the Company’s revenues. The Company’s methodology for estimating the total value of undiscounted cash flows was consistent with the approach used for the intangible asset recoverability test as of September 30, 2024. Certain estimates and assumptions, including the Company’s operating forecast for 2025 and future periods, were further revised based on current industry and Company trends. Based on the quantitative test performed, no impairment was deemed necessary. However, due to forecasted industry changes in the interactive flat panel display market as well as the Company’s operational strategy, the useful lives of certain intangible assets have been revised to reflect the current expected economic useful lives. The modification in useful lives resulted in accelerated amortization of approximately $12.3 million for both the Americas and EMEA reporting segments during the year ended December 31, 2024.

For the year ended December 31, 2025, the Company identified certain triggering events and circumstances that required it to evaluate its finite‑lived intangible assets for impairment. Management performed a recoverability test and concluded that the carrying amounts were recoverable; accordingly, no impairment losses were recognized related to the Company’s finite‑lived intangible assets during the year ended December 31, 2025.

SHARE-BASED COMPENSATION

The Company estimates the fair value of each stock option compensation award at the grant date by using the Black-Scholes option pricing model; the fair value of each restricted stock unit awarded is the market price of the underlying shares at the date of grant. The fair value determined represents the cost for the award and is recognized over the vesting period during which an employee is required to provide service in exchange for the award. Accordingly, stock compensation expense is recognized based on the estimated fair value of the awards which is amortized as compensation expense on a straight-line basis over the vesting period. Total expense related to the award is reduced by the fair value of the options that are forfeited by the employees that leave the Company prior to vesting as they occur.

The Company estimates the fair value of the long-term incentive plan by using a Monte Carlo Simulation Model. The amount of each award earned will depend on the performance of the Company relative to certain performance targets related to share price appreciation of the Company’s Class A common stock during the respective performance cycles. As amounts earned for the awards are based on changes in the Company’s stock price, the Company will recognize a liability for compensation cost each reporting period based on the fair value as of each reporting date proportionally with the elapsed time at each reporting period.

DERIVATIVE WARRANT LIABILITIES

The Company classifies common stock purchase warrants as equity if the contracts (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a

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requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions as either an asset or a liability. The Company assesses the classification of its freestanding derivatives at each reporting date to determine whether a change in classification between equity and liabilities is required.

The Company determined that certain warrants to purchase common stock do not satisfy the criteria for classification as equity instruments due to the existence of certain net cash and non-fixed settlement provisions that are not within the sole control of the Company. Such warrants are measured at fair value at each reporting date, and the changes in fair value are included in determining net income for the period.

INCOME TAXES

The Company follows the asset and liability method of accounting for income taxes pursuant to the pertinent guidance issued by the FASB. Deferred income taxes are recorded to reflect the estimated future tax effects of differences between the financial statement and tax basis of assets, liabilities, operating losses, and tax credit carry forwards using the tax rates expected to be in effect when the temporary differences reverse. Valuation allowances, if any, are recorded to reduce deferred tax assets to the amount management considers more likely than not to be realized. Such valuation allowances are recorded for the portion of the deferred tax assets that are not expected to be realized based on the levels of historical taxable income and projections for future taxable income over the periods in which the temporary differences will be deductible.