Financial Performance - Marker Therapeutics reported a net loss of $12.2 million for the year ended December 31, 2025, compared to a net loss of $10.7 million in 2024[8]. - The net loss for the year ended December 31, 2025, was $12,163,620, compared to a net loss of $10,731,315 in 2024, indicating an increase in losses of approximately 13.4%[17]. - Total revenues for 2025 were $3.5 million, down from $6.6 million in 2024, primarily due to reduced grant income[15]. - Research and development expenses decreased to $11.8 million in 2025 from $13.5 million in 2024[6]. - General and administrative expenses remained stable at $4.2 million for both 2025 and 2024[8]. Cash and Liquidity - The company had cash, cash equivalents, and restricted cash of $17 million as of December 31, 2025, expected to fund operations through Q4 2026[5]. - Cash, cash equivalents, and restricted cash at the end of 2025 totaled $17,042,847, down from $19,192,440 at the end of 2024, representing a decrease of approximately 11.2%[17]. - The company experienced a net decrease in cash, cash equivalents, and restricted cash of $2,149,593 in 2025, compared to an increase of $4,080,990 in 2024[17]. - Net cash used in operating activities for 2025 was $12,014,081, up from $10,910,324 in 2024, reflecting a year-over-year increase of about 10.1%[17]. - The company’s cash flow from financing activities provided $9,864,488 in 2025, down from $14,991,314 in 2024, reflecting a decrease of approximately 34.1%[17]. Clinical Development - Marker Therapeutics reported a 66% objective response rate in relapsed non-Hodgkin lymphoma from the Phase 1 APOLLO study, with 50% achieving complete responses[2]. - The company anticipates providing additional APOLLO data updates in Q2 2026 and initiating a pancreatic cancer clinical program[2]. - The Phase 1 study of MT-601 in lymphoma is enrolling patients with relapsed Diffuse Large B Cell Lymphoma at the maximum dose level of 400×10⁶ cells[7]. - Marker is advancing its MAR-T platform in pancreatic cancer, with a publication in Nature Medicine reporting an 84.6% disease control rate when combined with chemotherapy[7]. Operational Changes - The company strengthened its manufacturing capabilities through a collaboration with Cellipont Bioservices, with technical transfer expected to complete in Q2 2026[7]. - Related party payable decreased by $1,710,500 in 2025, compared to an increase of $380,845 in 2024, indicating a significant change in liabilities[17]. - Deferred revenue increased by $974,799 in 2025, while there was no deferred revenue reported in 2024, suggesting growth in future revenue recognition[17]. Stock and Compensation - Proceeds from the issuance of common stock, net, were $9,863,883 in 2025, compared to $14,929,155 in 2024, showing a decline of about 33.9%[17]. - The company reported stock-based compensation of $537,540 for 2025, which is an increase from $245,864 in 2024, marking a rise of approximately 118.5%[17]. - Changes in other receivables resulted in a positive cash flow of $977,303 in 2025, contrasting with a negative change of $1,318,888 in 2024[17].

Intellectual Property and Technology Risks - The company had 45 issued and 52 pending U.S. patents covering its technology as of December 31, 2025[210]. - The company relies on third-party technology licenses, which may be difficult to replace and could lead to operational delays if not renewed[220]. - The company uses open source software in its products, which could impose unanticipated conditions or restrictions on commercialization if not properly managed[219]. - The company may be subject to significant liability for damages due to third-party intellectual property claims, which could divert management's attention and resources[218]. - The company may need to develop alternative non-infringing technology if it cannot obtain necessary licenses, which could require significant effort and expense[218]. - The company’s ability to protect its intellectual property rights is critical for maintaining its competitive position, and failure to do so could adversely affect its business[209]. - The company may experience decreased demand for its technology if changes in or loss of third-party licenses occur[222]. Regulatory and Compliance Risks - The company may incur substantial professional fees and significant management efforts to comply with Section 404 of the Sarbanes-Oxley Act[204]. - The company faces risks related to potential material weaknesses in its internal control over financial reporting, which could adversely affect investor confidence and stock price[205]. - The SEC's classification of digital assets as "securities" could lead to significant regulatory consequences, impacting trading value and liquidity of those assets[229]. - The company recognizes that state regulators and foreign jurisdictions may enforce their own securities laws, potentially leading to additional compliance challenges[237]. - The SEC's crypto task force aims to clarify federal securities laws for digital assets, which may influence future regulatory frameworks[230]. - The company has established procedures to assess whether digital assets could be classified as securities, which may evolve with regulatory changes[234]. - Any determination that a digital asset is a security could result in liability for unregistered securities offerings, impacting the company's business operations[231]. - The company is exposed to significant regulatory scrutiny and potential legal actions, which could lead to fines and penalties affecting its financial position[267]. Digital Assets and Market Risks - The company operates in the cryptocurrency and digital assets space, which carries unique risks and uncertainties[223]. - Digital assets are subject to high risks including fraud, theft, and cyber attacks, which can adversely affect the company's financial condition and operations[224]. - The intrinsic value of digital assets is uncertain and highly speculative, influenced by market adoption and future growth expectations, with no guarantee of maintaining value over time[225]. - The emergence of alternative digital assets and central bank digital currencies (CBDCs) could negatively impact the market price of cryptocurrencies held by the company, affecting its financial condition[238][242]. - The growth of digital assets with superior transaction validation mechanisms could lead to a loss of market share for the company's current investments[240]. - Cryptocurrency price volatility necessitates substantial cash reserves to maintain operational resilience, as significant declines in asset value could adversely affect financial health[249]. - The operational integrity of digital asset trading platforms is a critical risk factor, with vulnerabilities to hacking and fraud that could materially affect the company's financial condition[255]. - The company must remain vigilant about market manipulation and fraudulent activities in unregulated cryptocurrency markets, which could distort asset valuations[254]. - The evolving regulatory landscape for digital assets presents ongoing risks that could impact the company's operations and market perception[247]. Financial Performance and Stock Market Risks - The market price of the company's common stock has shown significant volatility, fluctuating between $18,890.55 and $73,163.42 per share in 2021, and between $1,293.85 and $21,139.43 per share in 2022[270]. - From January 1, 2023 to December 31, 2023, the reported closing price of the common stock fluctuated between $15.95 and $2,400.30 per share[270]. - The company received a letter from Nasdaq on February 24, 2026, indicating non-compliance with the minimum bid price requirement of $1.00 per share for 30 consecutive business days[279]. - The company has an initial compliance period of 180 calendar days, until August 24, 2026, to regain compliance with the minimum bid price requirement[280]. - If the company fails to regain compliance by August 24, 2026, it may be subject to delisting from Nasdaq, which could adversely affect stockholder value and market liquidity[281]. - The company may be considered a penny stock if delisted, which could further reduce market liquidity and discourage broker-dealers from effecting transactions[283]. - The volatility of the company's common stock may be influenced by external factors such as market conditions, analyst recommendations, and broader economic developments[271]. - The company expects significant additional capital will be needed in the near future to continue planned operations, which may lead to a decline in the market price of its common stock due to substantial sales of shares[286]. - The company has financed operations and plans to continue doing so through issuing equity, warrants, and/or convertible securities, which could significantly dilute existing stockholders' ownership[287]. - The company does not intend to pay cash dividends on its common stock for the foreseeable future, retaining all future earnings for business development and corporate purposes[288]. - The company is authorized to issue "blank check" preferred stock without stockholder approval, which could dilute current stockholder interests and impair voting rights[289]. - All warrants to purchase shares of common stock are currently out-of-the-money, with exercise prices ranging from $1.83 to $66,900, and may expire worthless if the stock price remains below these levels[290]. - The market for "penny stocks" has suffered from fraud and abuse, which the company aims to mitigate within practical limitations[285]. - The company is required to deliver a disclosure schedule prepared in accordance with SEC standards prior to any transaction involving penny stocks[284]. - The company may raise additional funds through debt or the issuance of other securities, which could have a dilutive impact on common stockholders[287]. - The company is aware of historical abuses in the penny stock market and strives to prevent similar patterns regarding its securities[285]. - The company anticipates that any future determination to pay dividends will be at the discretion of its Board[288].

Credit Losses and Loan Portfolio - As of December 31, 2025, the allowance for credit losses (ACL) on loans was $8.6 million, representing 0.95% of the total loan portfolio, compared to $8.5 million or 0.94% at December 31, 2024[111]. - Total nonaccrual loans decreased to $5.8 million, or 0.64% of total loans outstanding, from $7.5 million, or 0.83% in the previous year[114]. - The ACL as a percentage of nonperforming loans increased to 148.82% at December 31, 2025, from 113.46% at December 31, 2024[117]. - Modified loans to troubled borrowers amounted to $1.1 million at December 31, 2025, down from $1.3 million in 2024[102]. - The company recorded a release of provision for credit losses of $212 thousand for the year ended December 31, 2025, compared to a provision of $161 thousand for the previous year[117]. - The company continuously monitors its loan portfolio for potential deterioration due to economic conditions, including inflation and interest rates[116]. Deposits and Funding - As of December 31, 2025, total deposits increased by $111.1 million to $948.9 million, primarily due to a $125.5 million (60.9%) increase in money market accounts[132]. - Core deposits represented approximately 85.3% of total deposits at December 31, 2025, down from 87.3% at December 31, 2024[129]. - The company had $27.0 million in public fund deposits at December 31, 2025, compared to $15.9 million at December 31, 2024[134]. - Total certificates of deposit increased by $3.8 million (1.3%) to $299.6 million at December 31, 2025[132]. - Approximately $184.7 million of the deposit portfolio was uninsured as of December 31, 2025[135]. - The average rate paid on total deposits was 2.32% for the year ended December 31, 2025, down from 2.64% in 2024[133]. - Money market accounts represented 34.9% of total deposits at December 31, 2025, up from 24.6% at December 31, 2024[132]. Regulatory Compliance and Oversight - The Company is subject to extensive regulatory oversight by the FDIC and WDFI, which includes maintaining minimum levels of regulatory capital[151]. - The FDIC assesses deposit insurance premiums quarterly, which could impact the Company's operating expenses if rates increase significantly[159]. - Sound Community Bank is subject to comprehensive regulation by the Federal Reserve, ensuring it operates in a safe and sound manner[192]. - Non-compliance with federal or state privacy and cybersecurity laws could lead to substantial regulatory fines and reputational harm[181]. - The federal banking agencies proposed lowering the CBLR requirement to 8% effective November 25, 2025, allowing institutions a grace period to meet qualifying criteria[165]. - Sound Community Bank received a "satisfactory" rating in its most recent CRA evaluation, indicating compliance with community reinvestment obligations[174]. Investment Securities - The company had no recognized credit losses on investment securities during the year ended December 31, 2025[126]. - At December 31, 2025, there were 15 securities in an unrealized loss position for more than 12 months, but the decline in value was not attributed to credit deterioration[126]. - The company closely monitors investment securities for changes in credit risk, with potential future earnings and equity impacts if market conditions deteriorate[126]. - Sound Financial Bancorp's investment strategy emphasizes safer investments, focusing on managing risks such as credit risk and interest-rate risk[121]. Capital and Borrowings - The Company had no outstanding borrowings and an unused borrowing capacity of $18.5 million and $20.8 million as of December 31, 2025 and 2024, respectively[141]. - The Company completed a private placement of $12.0 million in subordinated notes with a fixed interest rate of 5.25% until October 1, 2025, after which it will reset quarterly based on the three-month term SOFR plus 513 basis points[142]. - Sound Community Bank had $10.0 million in outstanding borrowings from the FHLB of Des Moines and an available line of credit of $187.7 million as of December 31, 2025, relying on FHLB advances for asset and loan growth[189]. - The Bank received $153 thousand in dividends from the FHLB of Des Moines during the year ended December 31, 2025[190]. Employee and Diversity Metrics - Sound Financial Bancorp had a total of 92 full-time employees and 30 part-time employees as of December 31, 2025, with an average employee tenure of 6.38 years[210][211]. - Approximately 61% of the workforce was female, and women held 69% of the Bank's management roles, highlighting a commitment to diversity[211].

Financial Position - As of December 31, 2025, the Trust Account held $6,196,874, approximately $12.00 per share, with an additional $18,708 in cash available for working capital[167]. - As of March 5, 2024, there were 7,327,478 issued and outstanding shares of Common Stock, including 7,077,478 Class A Shares and 250,000 Class B Shares[157]. - The Company has Class A common stock subject to possible redemption amounting to $6,297,899 as of December 31, 2025, classified as temporary equity[182]. - The Company has no off-balance sheet financing arrangements or long-term liabilities, except for a monthly fee of $15,000 for office space and administrative support, which will accrue until a business combination is completed[176][177]. - The Company does not have any long-term debt or capital lease obligations as of December 31, 2025[177]. Revenue and Expenses - The Company has not generated any revenues to date and only incurs expenses related to being a public company and due diligence for business combinations[164]. - The Company incurred operating expenses totaling $2,028,609 for the year ended December 31, 2025[165]. - The net loss for the year ended December 31, 2025, was $2,339,611, which included interest income of $283,899 and a loss of $308,100 on the change in fair value of derivative warrant liabilities[169]. - The net loss for the year ended December 31, 2024, was $3,942,881, offset by interest income and a gain of $858,100 on the change in fair value of derivative warrant liabilities[166]. Business Combination and Funding - The Company intends to use funds held in the Trust Account to complete an initial business combination, with deferred underwriting fees of up to $8,050,000 contingent upon this completion[171]. - Stockholders approved an extension of the deadline for completing an initial business combination from May 2, 2025, to May 1, 2026, with potential further extensions[162]. - The Sponsor provided a total of $1,465,000 in loans for working capital purposes during the year ended December 31, 2025, with outstanding balances of $3,800,000 (plus $210,542 of accrued interest) as of December 31, 2025[175]. - The Company has received multiple Commitment Letters from the Sponsor, totaling up to $3,125,000, to ensure continued operations for at least 12 months[175]. Financial Concerns - The Company may lack sufficient financial resources to sustain operations for a reasonable period, raising substantial doubt about its ability to continue as a going concern[170]. Securities and Valuation - The Public Warrants are valued using publicly available prices and classified as Level 1 on the Fair Value Hierarchy, while Private Placement Warrants are classified as Level 3 due to the use of unobservable inputs[185]. - The Company has no dilutive securities as of December 31, 2025, resulting in diluted net income per common share being the same as basic net income per common share[187]. - The Company is obligated to pay B. Riley Securities, Inc. a cash fee of 3.5% of the gross proceeds of the Public Offering upon the consummation of the initial business combination[178]. Regulatory and Accounting Changes - The Company adopted ASU 2023-09 for the annual period beginning January 1, 2025, enhancing transparency in income tax disclosures[189]. - The Company has not entered into any transactions that create relationships with unconsolidated entities or financial partnerships[176].

Financial Position - As of December 31, 2025, the Trust Account held $6,196,874, approximately $12.00 per share, with an additional $18,708 in cash available for working capital [167]. - As of March 24, 2025, there were 6,488,146 issued and outstanding shares, including 6,238,146 Class A Shares and 250,000 Class B Shares [162]. - As of December 31, 2025, the shares of Class A common stock subject to possible redemption amounted to $6,297,899, classified as temporary equity [182]. Revenue and Expenses - The net loss for the year ended December 31, 2025, was $2,339,611, which included interest income of $283,899 and a loss of $308,100 on the change in fair value of derivative warrant liabilities [169]. - The company has not generated any revenues to date and only incurs expenses related to being a public company and due diligence for business combinations [164]. - The company incurred operating expenses totaling $2,028,609 for the year ended December 31, 2025 [165]. Business Combination Plans - The company intends to use all funds in the Trust Account to complete an initial business combination, with additional financing potentially required if public shares are redeemed [171]. - Stockholders approved an extension of the deadline for completing a business combination from May 2, 2025, to May 1, 2026, at the April 2025 Special Meeting [162]. - The company plans to use funds held outside the Trust Account primarily for business, legal, and financial due diligence related to a business combination [168]. Financial Viability - The company may lack sufficient financial resources to sustain operations for a reasonable period, raising substantial doubt about its ability to continue as a going concern [170]. - The Sponsor provided a total of $1,465,000 in loans for working capital purposes during the year ended December 31, 2025, with an outstanding balance of $3,800,000 plus accrued interest as of December 31, 2025 [175]. - The Company has no long-term debt or capital lease obligations, with a monthly fee of $15,000 for office space and administrative support, which will accrue and be payable upon completion of a business combination [177]. Securities and Valuation - The Company has no off-balance sheet financing arrangements as of December 31, 2025, and does not participate in transactions that create relationships with unconsolidated entities [176]. - The Company will pay B. Riley Securities, Inc. a cash fee of 3.5% of the gross proceeds of the Public Offering upon consummation of the initial business combination [178]. - The Public Warrants were valued using publicly available prices and classified as Level 1 on the Fair Value Hierarchy as of December 31, 2025 [185]. - The Company has no dilutive securities or contracts that could potentially be exercised or converted into common stock as of December 31, 2025, resulting in diluted net income per common share being the same as basic net income per common share [187]. Accounting Changes - The Company adopted ASU 2023-09 for the annual period beginning January 1, 2025, enhancing transparency in income tax disclosures [189].

Product Development and Clinical Trials - The company is advancing two product candidates for three clinical indications as part of its MAR-T cell program, focusing on autologous MAR-T cell therapy for lymphoma and pancreatic cancer (MT-601) and an off-the-shelf product (MT-401-OTS) for AML or MDS[16]. - In the Phase 1 APOLLO study, 66% of NHL patients achieved objective responses, with 50% demonstrating complete response, and durable responses were observed in five patients for over six months[26]. - The Phase 1/2 clinical trial (TACTOPS) for MT-601 in pancreatic cancer showed a disease control rate of 84.6% when combined with frontline chemotherapy, with no cytokine release syndrome or neurotoxicity reported[25]. - The FDA granted orphan drug designation to MT-601 for pancreatic cancer treatment and cleared the IND application for the PANACEA study, which will assess MT-601 in combination with chemotherapy[27]. - The company received a $9.5 million grant from CPRIT and a $2 million grant from NIH to support the clinical investigation of MT-601 in metastatic pancreatic cancer[27]. - The MT-401-OTS program aims to provide a fast treatment option for AML or MDS patients, with the potential for large-scale manufacturing and treatment initiation within 72 hours[28]. - The first patient in the OTS program was treated in October 2025, with preliminary safety data consistent with the favorable profile of MAR-T cells[29]. - The company plans to explore new product opportunities by customizing targeted antigens to expand the indications for MAR-T cell products[38]. - The strategy includes expediting clinical development and regulatory approval of lead product candidates, with a focus on advancing MT-601 and the OTS program[35]. - The company is advancing two MAR-T cell therapies: autologous MAR-T targeting multiple antigens and off-the-shelf (OTS) MAR-T with a pre-manufactured inventory[46][47]. - In a Phase 1 clinical trial for lymphoma, 6 out of 15 evaluable patients achieved complete responses (CR), with no relapses reported among CR patients, contrasting with a typical 30% relapse rate in CAR-T studies[54]. - The MAR-T cell therapy demonstrated a 77% estimated two-year overall survival rate in post-transplant AML patients, with 11 out of 15 remaining alive at a median follow-up of 1.9 years[72]. - In the pancreatic cancer trial, significant expansion of MAR-T cells was observed in patients responding to therapy, with no cytokine release syndrome or neurotoxicity reported[67][69]. - The clinical trials conducted by BCM showed significant in vivo expansion of MAR-T cells, indicating a promising therapeutic effect across various cancer indications[58]. - The company has not previously submitted a biologics license application, which requires extensive data to establish safety and effectiveness, complicating the regulatory approval process[182]. - Clinical trials are subject to numerous risks, including delays in recruitment and completion, which could harm commercial prospects and increase costs[186]. - The company may face delays in clinical trials due to challenges in patient enrollment, competition with other trials, and unforeseen events[195]. - The company has experienced delays in clinical trials due to COVID-19 and FDA requirements, impacting cost estimates and timelines[188]. - The results of earlier trials may not predict future outcomes, and setbacks can occur at any stage of the clinical trial process[193]. Manufacturing and Production - The company has optimized the MAR-T cell manufacturing process, reducing the total manufacturing time from 36 days to nine days, resulting in a four-fold increase in potency in vitro[37]. - The manufacturing process for MAR-T cells is designed to select and expand T cells specific for targeted antigens, aiming to restore their functionality and achieve the required patient dose[76]. - The average patient product contains approximately 4,000 different T cell clonotypes specific to 5 antigens[79]. - The company expects substantial manufacturing costs for its MAR-T cell product candidates due to patient-specific production and complex processing steps[188]. - Manufacturing capabilities may be impacted by cost overruns, unexpected delays, and regulatory approval processes, potentially leading to increased clinical trial costs and delays in product commercialization[209]. - The company relies on a limited number of vendors for critical materials and equipment, which poses risks to the manufacturing and supply of product candidates[210]. - Sole-source vendor reliance could adversely affect the ability to meet demand for product candidates, significantly harming operating results and clinical trial conduct[211]. - The manufacturing process for biologics is complex and highly regulated, with higher costs and risks of product loss or failure compared to traditional small molecule compounds[213]. Financial and Operational Risks - The company has a history of operating losses and expects these losses to continue indefinitely, raising substantial doubt about its ability to continue as a going concern[170]. - The company has no approved products or product candidates pending approval, resulting in no revenue from product sales and a reliance on raising additional financing[171]. - The company anticipates that operational costs will increase significantly, with cash and cash equivalents expected to fund operations only through Q4 2026 without additional grants[172]. - Plans to raise additional capital through common share issuance and grants are uncertain, and failure to secure this funding may lead to curtailed operations[173]. - The biotechnology industry is characterized by rapid technological developments and high competition, which may hinder the company's ability to compete effectively[170]. - The company faces risks related to compliance with various federal and state laws, which could result in significant penalties if violated[150]. - Significant uncertainty exists regarding the coverage and reimbursement status of pharmaceutical products, which can vary significantly among third-party payors[151]. - The U.S. government and foreign jurisdictions are implementing cost-containment programs that may limit sales of pharmaceutical products[153]. - The Affordable Care Act (ACA) has significantly affected the pharmaceutical industry, with ongoing legislative challenges and reforms impacting pricing and reimbursement[157]. Regulatory Environment - The FDA regulates the research, development, and marketing of biologics, requiring compliance with various preclinical and clinical approval processes[121]. - Human clinical trials typically involve three phases, with Phase 1 focusing on safety, Phase 2 on preliminary efficacy, and Phase 3 on establishing risk/benefit ratios[127]. - The BLA submission to the FDA must include all relevant data from preclinical and clinical studies, along with a substantial application user fee[128]. - The FDA aims to review standard BLA applications within ten months and priority reviews within six months after acceptance for filing[129]. - Approval letters authorize commercial marketing with specific indications, while Complete Response letters outline deficiencies and may delay approval[130]. - Orphan drug designation is granted for drugs treating rare diseases affecting fewer than 200,000 individuals in the U.S., providing seven years of exclusivity upon first approval[138][139]. - The FDA may require post-marketing studies to monitor safety and effectiveness, and can withdraw approval if compliance is not maintained[141][142]. - Fast track designation and breakthrough therapy designation expedite the review process for products addressing serious conditions with unmet medical needs[132][133]. - Products may receive accelerated approval based on surrogate endpoints likely to predict clinical benefit, with post-marketing studies required[135]. - The BPCIA establishes a 12-year exclusivity period for reference products, impacting the approval timeline for biosimilars[146]. - The FDA's regulations impose strict requirements on record-keeping, adverse experience reporting, and compliance with cGMP for approved products[141]. - The FDA may impose restrictions or withdraw approval based on newly discovered safety issues or non-compliance with regulatory standards[142][143]. Intellectual Property and Strategic Alliances - The company’s commercial success depends on obtaining and maintaining patent protection for its technology and inventions, as well as defending proprietary rights[107]. - The intellectual property portfolio includes patent applications for methods of generating multi-antigen specific T cell products and their therapeutic uses[108]. - The company believes its patent portfolio and next-generation technologies provide a substantial intellectual property position, though the biotechnology patent landscape is evolving with risks[109]. - The company reassesses the value of each patent at maintenance fee due dates, declining to pay for patents deemed of no significant strategic value[111]. - The company relies on trade secrets and regulatory protections, including orphan drug designations and market exclusivity, to maintain its proprietary position in immuno-oncology[117]. - The company entered into a Statement of Work with Cellipont for the manufacturing of MT-601, its lead MAR-T cell product, in anticipation of a pivotal trial for lymphoma in 2026[82]. - The company has entered into a strategic alliance with BCM for advancing pre-clinical and early-stage clinical trials, ensuring continued access to clinical data and manufacturing support[103]. - The BCM License Agreement includes a royalty fee schedule based on net sales, with percentages ranging from 0.65% to 5.0%[96]. - The company is responsible for up to $64.85 million in milestone payments upon achieving specific clinical and sales milestones under the BCM License Agreement[96]. - The company retains ownership over any intellectual property developed under CPRIT grant agreements, granting CPRIT a nonexclusive, irrevocable, royalty-free license for non-commercial use[105]. - If products become commercially saleable, the company is obligated to pay CPRIT a percentage of revenue ranging from low-to-mid single digits until CPRIT receives an aggregate amount of 400% of the funds paid under the grant agreements[106]. Workforce and Corporate Structure - The company has 5 full-time employees as of December 31, 2025, with no employees under collective bargaining agreements[162]. - 100% of the company's executive officers are women or self-identify as members of underrepresented minority groups[165]. - The company is incorporated in Delaware and trades on the Nasdaq Capital Market under the symbol "MRKR"[166]. - The company has not experienced any product liability claims to date but carries products and clinical trial liability insurance policies[161]. - The company has consulting agreements with leading academic scientists and regulatory experts to support its operations[163]. - The company’s human capital resources objectives include attracting and retaining a diverse workforce[165].

Financial Performance - The Company reported net income of $5.612 million for 2025, an increase of 55.8% compared to $3.601 million in 2024[106]. - Diluted earnings per share rose to $0.34 in 2025 from $0.21 in 2024, reflecting improved profitability[106]. - Non-interest income for 2025 totaled $17.0 million, a decrease of $986,000, or 5.5%, from 2024[137]. - The effective tax rate decreased to 17.4% in 2025 from 18.1% in 2024, resulting in an income tax expense of $1.2 million[139]. - The Company's total shareholders' equity increased by $12.1 million, or 11.2%, since year-end 2024[146]. Interest Income and Expenses - Net interest income increased by $6.215 million, or 17.2%, reaching $42.263 million in 2025, driven by a net interest margin improvement of 34 basis points to 3.15%[104][106]. - Total interest income for 2025 was $71.354 million, a 7.3% increase from $66.505 million in 2024[106]. - Total interest expense decreased by $1.4 million, or 4.5%, for 2025, despite a 7.2% increase in average interest-bearing deposits[115]. - Borrowings interest expense declined by $1.4 million, or 27.7%, for 2025, due to lower utilization of overnight borrowed funds[116]. - The net interest margin improved to 3.15% in 2025 from 2.81% in 2024, reflecting better cost management and interest income growth[118]. Loan and Deposit Growth - Total deposits averaged $1.236 billion in 2025, up $67.3 million or 5.8% from $1.169 billion in 2024[109]. - Total average deposits for 2025 increased by $67.3 million, or 5.8%, reflecting successful business development efforts[113]. - Total deposits grew by $47.1 million, or 3.9%, on an end-of-period basis since December 31, 2024, indicating strong customer loyalty[114]. - The loan to deposit ratio averaged 83.8% in Q4 2025, indicating ample capacity for loan portfolio growth[114]. - Average total loans for 2025 grew by $23.7 million, or 2.3%, but experienced a $35.4 million, or 3.3%, decrease in the second half due to higher commercial real estate loan payoffs[111]. Credit Quality and Risk Management - The provision for credit losses was $4.120 million in 2025, compared to $884,000 in 2024, indicating a strategic focus on managing credit risk[104]. - Non-performing loans decreased from $10.9 million (1.02% of total loans) in 2024 to $8.3 million (0.80% of total loans) in 2025, a reduction of 24%[124]. - The allowance for credit losses on loans decreased by $784,000 (5.6%) to $13.1 million at December 31, 2025, compared to $13.9 million in 2024[129]. - Total classified loans decreased by $12.2 million (52.0%) from December 31, 2024, totaling $11.3 million at December 31, 2025[124]. - The allowance for credit losses provided 158% coverage of non-performing loans at December 31, 2025, compared to 127% at the end of 2024[129]. Asset Management - The Company's total assets grew to $1.453 billion in 2025, up from $1.422 billion in 2024[100]. - Total consolidated assets increased by $31.5 million, or 2.2%, to $1.454 billion at December 31, 2025[144]. - The average balance of total interest-earning assets was $1.3 billion in 2025, with total loans averaging $1.061 billion, a 2.3% increase from 2024[108]. - The fair market value of wealth management assets totaled $2.7 billion at December 31, 2025, an increase of $122.5 million, or 4.8%, since December 31, 2024[137]. - The Company had outstanding commitments to extend credit approximating $239.9 million and standby letters of credit of $8.8 million as of December 31, 2025[175]. Capital and Liquidity - The Bank's common equity tier 1 capital ratio was 11.70% and total capital ratio was 12.88% at December 31, 2025, exceeding all regulatory capital ratios[156]. - The tier 1 leverage ratio was 9.32% at December 31, 2025, with expectations to maintain strong capital ratios throughout 2026[156]. - The Company has $311 million of overnight borrowing availability at the FHLB and $41 million at the Federal Reserve Bank, indicating ample liquidity to fund outstanding loan commitments[155]. - The Company executed $70 million of interest rate hedges during 2023 to mitigate negative variability of net interest income in a rising interest rate environment[167]. - The tangible common equity ratio (non-GAAP) increased to 7.34% as of December 31, 2025, compared to 6.64% in 2024[179]. Strategic Focus and Future Outlook - The Company aims to increase earnings per share and manage revenue growth and expense control to enhance shareholder value[196]. - The Company plans to leverage union affiliated revenue streams and implement technological advancements to drive efficiency and profitability[197]. - The strategic focus includes providing exceptional customer service and enhancing the Banking for Life philosophy through comprehensive financial solutions[199]. - The Company is committed to developing high-performing employees and managing staff attrition through a workforce succession plan[199]. - The Company anticipates providing leading banking systems and solutions to improve customer experience and meet evolving needs[199].

Revenue Performance - Fourth quarter revenue for 2025 was approximately $1.4 million, a 113% increase from $0.64 million in the third quarter[1] - Full year revenue for 2025 totaled $3.7 million, down from $7.8 million in 2024, primarily due to the absence of two large deals from the previous year[4] - Revenues for the year ended December 31, 2025, were $3,671,000, a decrease of 52.7% compared to $7,760,000 in 2024[27] Profitability and Loss - Fourth quarter gross margin improved to 35%, up from 28% in the third quarter[3] - Gross profit for 2025 was $1,218,000, down from $4,270,000 in 2024, reflecting a gross profit margin of 33.2% compared to 55.0% in the previous year[27] - Operating loss for 2025 was $7.2 million, compared to $3.8 million in 2024, driven by lower sales and consistent operating expenditures[11] - Operating loss increased to $7,185,000 in 2025 from $3,758,000 in 2024, indicating a significant rise in operating expenses[27] - Net loss for 2025 was $8.3 million, an increase from a net loss of $4.4 million in 2024, attributed to lower sales and a one-time financial commitment expenditure[13] - Net comprehensive loss for the year was $8,261,000, compared to a loss of $4,374,000 in 2024, resulting in a net loss per share of $5.68[27] - Non-GAAP Adjusted EBITDA for 2025 was $(6,856,000), compared to $(3,481,000) in 2024, showing a worsening operational performance[35] Expenses - Research and Development expenses for 2025 were $2.6 million, up from $2.4 million in 2024, due to currency exchange impacts[6] - Sales and marketing expenses increased to $2.9 million in 2025 from $2.6 million in 2024, primarily due to consultant engagements[8] - Research and development expenses rose to $2,638,000 in 2025 from $2,383,000 in 2024, highlighting continued investment in innovation[27] Financial Position - As of December 31, 2025, the company had approximately $4 million in cash and cash equivalents, with an additional $7.3 million raised through its ATM facility[15] - Total current liabilities decreased to $3,492,000 in 2025 from $4,583,000 in 2024, while total liabilities decreased to $4,733,000 from $5,240,000[25] - Total shareholders' equity increased significantly to $4,797,000 in 2025 from $2,985,000 in 2024, reflecting a stronger equity position[25] - Cash and cash equivalents at the end of 2025 were $4,057,000, up from $1,967,000 at the end of 2024, indicating improved liquidity[30] Business Development - Actelis expanded its footprint in federal and defense markets, securing deployments for U.S. military base connectivity and FAA infrastructure initiatives[7] - The company completed its MDU product family development in 2025, enabling deployments in hotels and sports venues[7] Financing Activities - Proceeds from financing activities in 2025 totaled $9,797,000, significantly higher than $3,093,000 in 2024, indicating successful capital raising efforts[30]

Revenue and Customer Base - Actelis Networks derives approximately 73% and 72% of its revenues from IoT customers for the years ended December 31, 2025, and December 31, 2024, respectively [27]. - The top ten customers accounted for approximately 62% and 74% of total revenues for the years ended December 31, 2025, and December 31, 2024, respectively [28]. Financial Position - As of December 31, 2025, Actelis had an accumulated deficit of $52 million and cash on hand of $4.4 million [29]. - The company reported a net loss of $8.3 million for the year ended December 31, 2025, and an accumulated deficit of $52 million as of the same date [193]. - Negative cash flows from operations were $7.7 million for the year ended December 31, 2025 [195]. - The company has cash on hand of $4.4 million, with long-term restricted bank deposits of $30 thousand and $91 thousand as of December 31, 2025 [195]. Product Development and Innovation - The company launched its MetaShield AI-Powered SaaS solution in December 2024, designed to monitor and protect IoT devices [26]. - Actelis' hybrid fiber networking solutions can deliver connectivity speeds of up to multi-Gigabit while supporting Fiber-grade reliability [19]. - In 2025, Actelis enhanced its service capabilities in monitoring market vulnerabilities, offering embedded software upgrades to protect against emerging threats [41]. - The company has invested nearly $100 million in developing its patented "Triple Shield" technology, enhancing connectivity performance and security through features like 256-bit encryption [101]. - In 2023, the company launched the "Gigaline" product family, addressing challenges in hybrid-fiber connectivity for IoT and telecom customers [102]. - The GL800 product line extends multi-gigabit fiber-grade connectivity to various installations, including buildings and 5G base stations [103]. - The GL900 product line enables Gigabit connectivity from fiber installations to individual offices and apartments, targeting over 20 million buildings in the US [104]. - The GL5000 and GL6000 product groups introduced in 2023 include over 40 variants of hardened, 10Gbps fiber switches for the IoT market [105]. - The MetaShield product, set to launch in 2024, is an AI-powered cybersecurity solution designed to monitor IoT devices for cyber risks and operational anomalies [107]. - The EMS network management software has been enhanced to support new products and includes advanced security features for better cyber protection [106]. Market Trends and Opportunities - The Edge AI market is projected to grow from approximately $20 billion in 2024 to nearly $190 billion by 2033, indicating significant market potential [46]. - The global cybersecurity market is expected to increase from approximately $240 billion in 2024 to nearly $500 billion by 2033, highlighting the demand for robust cybersecurity solutions [46]. - The Smart Transportation market is projected to exceed $250 billion by 2029, driven by the modernization of intelligent transportation systems [46]. - The Broadband Equity program has allocated $28 billion to modernize high-speed internet access across all 50 states, targeting underserved communities [48]. Capital Raising and Financial Compliance - In a private placement on June 30, 2025, the company raised approximately $1 million by issuing 162,602 shares of Common Stock at $6.15 per share [49]. - The Series A-3 and A-4 Warrants, exercisable at $6.15 per share, were issued in conjunction with the private placement, allowing for potential future capital [50][51]. - The company raised approximately $1.6 million from the exercise of existing warrants at a reduced price of $3.70 per share, enhancing its liquidity position [69]. - The Company entered into a Common Stock Purchase Agreement with White Lion Capital, allowing for the purchase of up to $30,000,000 in newly issued shares of Common Stock [74]. - The Company is required to file a Resale Registration Statement with the SEC for the shares issued under the Common Stock Purchase Agreement within five business days [75]. - The Company agreed to hold a Special Meeting to obtain shareholder approval for issuing Common Stock beyond the Exchange Cap within 120 days of October 1, 2025 [77]. - If shareholder approval is not obtained, the Company must call additional Special Meetings every 90 days for up to 360 days [78]. - The Company issued shares to White Lion as Commitment Shares valued at $750,000, calculated based on the lowest traded price of the Common Stock prior to issuance [79]. - The December 2025 Offering raised approximately $5 million from the sale of 4,352,500 shares of Common Stock and associated warrants [92]. - The net proceeds from the December 2025 Offering were approximately $4.46 million after deducting fees and expenses [97]. - The Board authorized an expansion of the stock repurchase program to a maximum aggregate purchase price of $1.5 million, with $50,000 already repurchased [99]. Compliance and Regulatory Issues - The company received a notification from Nasdaq regarding non-compliance with the Minimum Shareholders' Equity Requirement of $2,500,000 [55]. - Following a special meeting, the company regained compliance with Nasdaq listing requirements on August 27, 2024, but remained under a panel monitor until August 27, 2025 [56]. - The company was notified on May 12, 2025, of non-compliance with the Bid Price Rule, requiring a minimum bid price of $1.00 per share [201]. - The company faced potential delisting due to non-compliance with the Minimum Shareholders' Equity Requirement as of June 30, 2025 [202]. - A reverse stock split was executed on November 18, 2025, to help regain compliance with Nasdaq listing requirements [204]. - The company regained compliance with the Bid Price Rule on December 3, 2025, closing the previously disclosed listing matter [205]. - The company will remain under a one-year "Panel Monitor" to ensure compliance with Nasdaq listing requirements through December 5, 2026 [206]. - The company may face immediate delisting if its market value of listed securities remains below $5 million for 30 consecutive business days [212]. Strategic Focus and Growth Initiatives - The company aims to become the global leader in cyber-secure, cost-effective, and quick-to-deploy hybrid networking solutions for wide-area applications [32]. - The company has established a strong reputation with over 100 telecom service providers globally, focusing on both telecom and fast-growing IoT markets [115]. - The sales and marketing strategy includes a multi-channel approach with partners across North America, Europe, and Asia, enhancing the company's credibility and market reach [127]. - The company has focused sales efforts on the Programs of Record (PoRs) in the Department of War since late 2025, aiming to become the default technology in several branches [129]. - The company currently has projects in over 100 cities, primarily in North America and Europe, under the Smart City initiative [131]. - The company has signed an agreement to provide solutions to hundreds of airports in 39 countries since 2022, targeting airport security and baggage management [133]. - The company has entered into several large multi-year contracts with ITS, military, and airports, which will generate predictable sales for the coming years [160]. - The company is investing in expanding its sales and marketing presence in Federal and Military sectors, hiring key personnel to drive growth [159]. - The company is pursuing growth through mergers and acquisitions to fill business gaps and enhance offerings without lengthy marketing cycles [168]. - The company has projects in the Energy and Water sector, focusing on sub-station monitoring and pipeline security, with operations in North America and Europe [134]. - The company aims to leverage its unique value in IoT verticals, particularly in Federal/Military and Smart Cities, to enhance global recognition and coverage [157]. Operational Challenges and Risks - The company is subject to various federal, state, and foreign laws and regulations regarding environmental matters, which may impact operations [176]. - The company relies on a combination of trade secrets, patents, and trademarks to protect its intellectual property, with 29 patents granted in the U.S. [177][178]. - The company has a history of net losses and may incur substantial losses in the future, raising doubts about its ability to continue as a going concern [185]. - The company is focused on serving IoT verticals while continuing to serve existing Telco customers, which may complicate growth evaluation [186]. - The company has received Israeli government grants for research and development, which require compliance with specific conditions to avoid penalties [190]. - The company may continue to incur negative cash flow from operating and investing activities due to ongoing research and development, sales and marketing, and general administrative expenses [196]. - There is substantial doubt regarding the company's ability to continue as a going concern, which may limit its ability to raise additional funds through equity or debt securities [197].

Financial Performance - Net sales for 2025 were $515 million, a decrease of 6% compared to $547 million in 2024[3] - The company reported a GAAP net loss of $50 million for 2025, an improvement from a net loss of $126 million in 2024[3] - Adjusted EBITDA for 2025 was $39.2 million, slightly up from $39.1 million in 2024[3] - Gross profit margin improved to 29% in 2025, up from 22% in 2024, reflecting better operational efficiency[21] - The company forecasts adjusted EBITDA in the range of $44 million to $48 million for 2026[1] - Net loss for 2025 was $49,882 million, a significant improvement from a loss of $126,340 million in 2024[23] - Adjusted EBITDA for 2025 was $39,207 million, slightly up from $39,101 million in 2024[25] - The company reported a provision for income taxes of $2,679 million in 2025, down from $5,882 million in 2024[25] Sales Performance - U.S. crop sales decreased by 3% to $221.4 million, while U.S. non-crop sales increased by 10% to $90.3 million[21] - International sales fell by 14% to $203.4 million, contributing to the overall decline in net sales[21] Capital Structure and Liquidity - The company has entered into two new term loan agreements totaling $285 million, enhancing its capital structure and liquidity[3] - Cash flows from operating activities showed a net cash used of $21,191 million in 2025, compared to a net cash provided of $3,923 million in 2024[23] - Capital expenditures in 2025 were $3,919 million, down from $7,279 million in 2024[23] - Net cash provided by financing activities increased to $23,704 million in 2025 from $4,540 million in 2024[23] - The company had a cash balance of $12,425 million at the end of 2025, slightly down from $12,514 million at the end of 2024[23] - Payments under line of credit agreements were $223,465 million in 2025, compared to $294,356 million in 2024[23] Operational Changes - The company plans to rationalize its Los Angeles manufacturing facility, which is expected to lead to long-term operational efficiencies[2] - Personnel changes in the management of the commercial team are expected to enhance customer focus and increase sales volumes[2] Asset Management - The company incurred impairment of assets totaling $25,395 million in 2025, down from $50,414 million in 2024[23] - The company reported a decrease in customer prepayments of $19,582 million in 2025, compared to a decrease of $12,882 million in 2024[23]