As Filed with the Securities and Exchange Commission on January 26, 2026.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

AIAI HOLDINGS CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation or organization)

(Primary Standard Industrial Classification Code Number)

33-4103471

(I.R.S. Employer Identification Number)

17304 Preston Road, Suite 520

Dallas, TX 75252

(214) 935-9853

(Address, including zip code, and telephone number,

including area code, of registrant’s principal executive offices)

Todd Furniss

Chief Executive Officer

17304 Preston Road, Suite 520

Dallas, TX 75252

(214) 935-9853

(Name, address, including zip code, and telephone number,

including area code, of agent for service)

Copies to:

Kenneth L. Betts, Esq.

Egan Nelson LLP

2911 Turtle Creek Boulevard, Suite 1100

Dallas, Texas 75219

Approximate date of commencement of proposed sale to public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED JANUARY 26, 2026

PRELIMINARY PROSPECTUS

71,655,060 SHARES

AIAI Holdings Corporation

Common Stock

This prospectus relates to the registration of the resale of up to 71,655,060 shares, or the Shares, of our Class A common stock, or the common stock, by our stockholders identified in this prospectus, or the Registered Stockholders, in connection with our direct listing, or the Direct Listing, on the Nasdaq Global Market, or Nasdaq. Unlike an initial public offering, the resale by the Registered Stockholders is not being underwritten by any investment bank. The Registered Stockholders may elect to sell their Shares covered by this prospectus, as and to the extent they may determine. If the Registered Stockholders choose to sell their Shares, we will not receive any proceeds from the sale of such Shares. We have engaged RBW Capital Partners, LLC as our financial advisor, or the Advisor, to advise and assist us we respect to certain matters relating to the Direct Listing.

No public market for our common stock currently exists, and our shares of common stock have a limited history of trading in private transactions. At the time of the Direct Listing, we will have issued an aggregate of 30,926,000 shares of our common stock in private placements in connection with the acquisition of our portfolio companies at a price of $20.00 per share. For more information, see “Business—Our Portfolio Companies.” Recent sales of our common stock or securities convertible into our common stock in private transactions may have little or no relation to the opening public price of the Shares on Nasdaq or the subsequent trading price of shares of our common stock on Nasdaq. For more information, see “Sale Price History of Our Capital Stock.”

Further, the listing of our common stock on Nasdaq, without a firm-commitment underwritten offering, is a novel method for commencing public trading in shares of our common stock and, consequently, the trading volume and price of shares of our common stock may be more volatile than if shares of our common stock were initially listed in connection with an initial public offering underwritten on a firm-commitment basis.

On the day that the Shares are initially listed on Nasdaq, Nasdaq will begin accepting, but not executing, pre-opening buy and sell orders and will begin to continuously generate the indicative Current Reference Price (as defined below) on the basis of such accepted orders. The Current Reference Price is calculated each second and, during a 10-minute “Display Only” period, is disseminated, along with other indicative imbalance information, to market participants by Nasdaq on its NOII and BookViewer tools. Following the “Display Only” period, a “Pre-Launch” period begins, during which the Advisor, in its capacity as our financial advisor, must notify Nasdaq that the Shares are “ready to trade.” Once the Advisor has notified Nasdaq that the Shares are ready to trade, Nasdaq will confirm the Current Reference Price for the Shares, in accordance with Nasdaq rules. If the Advisor then approves proceeding at the Current Reference Price, the applicable orders that have been entered will be executed at such price and regular trading of the Shares on Nasdaq will commence, subject to Nasdaq conducting validation checks in accordance with Nasdaq rules. Under Nasdaq rules, the “Current Reference Price” means: (i) the single price at which the maximum number of orders to buy or sell can be matched; (ii) if there is more than one price at which the maximum number of orders to buy or sell can be matched, then it is the price that minimizes the imbalance between orders to buy or sell (i.e. minimizes the number of shares that would remain unmatched at such price); (iii) if more than one price exists under (ii), then it is the entered price (i.e. the specified price entered in an order by a customer to buy or sell) at which our shares of common stock will remain unmatched (i.e. will not be bought or sold); and (iv) if more than one price exists under (iii), a price determined by Nasdaq in consultation with the Advisor in its capacity as our financial advisor. In the event that more than one price exists under (iii), the Advisor will exercise any consultation rights only to the extent that it can do so consistent with the anti-manipulation provisions of the federal securities laws, including Regulation M, or applicable relief granted thereunder. The Registered Stockholders will not be involved in Nasdaq’s price-setting mechanism, including any decision to delay or proceed with trading, nor will they control or influence the Advisor in carrying out its role as a financial adviser. The Advisor will be issued 746,630 shares of our common stock in connection with and at the time of the Direct Listing and such shares are registered under this prospectus, and the Advisor is a Registered Stockholder. The Advisor will determine when the Shares are ready to trade and approve proceeding at the Current Reference Price primarily based on considerations of volume, timing and price. In particular, the Advisor will determine, based primarily on pre-opening buy and sell orders, when a reasonable amount of volume will cross on the opening trade such that sufficient price discovery has been made to open trading at the Current Reference Price. For more information, see the section “Plan of Distribution” of this prospectus.

We have applied to list our common stock on the Nasdaq Global Market under the symbol “AIAI.” We expect our Class A common stock to begin trading on Nasdaq on or about [___], 2026.

If our Nasdaq application is not approved or we otherwise determine that we will not be able to secure the listing of our Class A common stock on Nasdaq, we will not complete this Direct Listing. This listing is a condition to the offering. No assurance can be given that our Nasdaq application will be approved and that our common stock will ever be listed on Nasdaq. If our listing application is not approved by Nasdaq, we will not be able to consummate the offering and we will terminate this Direct Listing.

Upon completion of this offering, our founder, John P. Rochon, will beneficially own all of our issued and outstanding shares of Class B common stock, each of which has 10 votes per share, which will constitute approximately 50.1% of the voting power of our outstanding voting securities, and therefore, we will be a “controlled company” within the meaning of the listing rules of The Nasdaq Stock Market LLC. We do not intend to rely on any exemptions from the corporate governance requirements that are available to controlled companies.

We are an “emerging growth company” as defined under the federal securities laws and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus and may elect to do so in future filings. See “Prospectus Summary—Implications of Being an Emerging Growth Company.”

Investing in shares of our common stock involves a high degree of risk. See the “Risk Factors” section of this prospectus beginning on page 8 for the risks and uncertainties you should consider before investing in our common stock.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

Prospectus dated [____], 2026

TABLE OF CONTENTS

You should rely only on the information contained in this prospectus or contained in any free writing prospectus filed with the Securities and Exchange Commission. Neither we nor any of the Registered Stockholders have authorized anyone to provide any information different from, or in addition to, the information contained in this prospectus and in any free writing prospectuses we have prepared or that have been prepared on our behalf or to which we have referred you. Neither we nor any of the Registered Stockholders take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. The Registered Stockholders are offering to sell, and seeking offers to buy, their Shares only under the circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date, regardless of the time of delivery of this prospectus or of any sale of our common stock. Our business, financial condition, results of operations and prospects may have changed since such date.

For investors outside the United States: Neither we nor any of the Registered Stockholders have done anything that would permit the use of or possession or distribution of this prospectus or any related free writing prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of the Shares by the Registered Stockholders and the distribution of this prospectus outside the United States.

ABOUT THIS PROSPECTUS

This prospectus is a part of a registration statement on Form S-1 that we filed with the SEC using a “shelf” registration or continuous offering process. Under this shelf registration process, the Registered Stockholders may, from time to time, sell common stock covered by this prospectus in the manner described in the section titled “Plan of Distribution.” Additionally, we may provide a prospectus supplement to add information to, or update or change information contained in, this prospectus, including the section titled “Plan of Distribution.” You may obtain this information without charge by following the instructions under the section titled “Where You Can Find Additional Information” appearing elsewhere in this prospectus. You should read this prospectus and any prospectus supplement before deciding to invest in our common stock.

This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed or will be filed as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described under “Where You Can Find Additional Information.”

PROSPECTUS SUMMARY

This summary highlights selected information that is presented in greater detail elsewhere in this prospectus. This summary does not contain all the information you should consider before investing in our common stock. You should read this entire prospectus carefully, including the sections entitled “Risk Factors,” “Cautionary Note Regarding Forward-Looking Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the financial statements and the related notes of the company and two of our Portfolio Companies (as defined below) included elsewhere in this prospectus, before making an investment decision. Some of the statements in this prospectus constitute forward-looking statements. See the section titled “Cautionary Note Regarding Forward-Looking Information.” Unless the context otherwise requires, the terms “AIAI,” “the company,” “we,” “us,” and “our” in this prospectus refer to AIAI Holdings Corporation and our consolidated subsidiaries, which initially consist solely of our Portfolio Companies, as hereinafter defined.

Overview

AIAI was formed for the purpose of creating an AI-powered ecosystem through acquiring and scaling companies that have high potential for increased operating results through the integration of our Artificial Intelligence, or AI into their operations. We are not simply an investment vehicle—we seek to improve the operating performance of our subsidiaries through the application of our proprietary AI. The AI that we will apply to the companies that we acquire will be licensed to us by Messier 42 LLC, or M42, a company controlled by our founder, John P. Rochon, immediately prior to the effective date, or the Effective Date, of the Registration Statement of which this prospectus forms a part. See “Business—License Agreement.” AIAI will identify, acquire, and, where appropriate, consolidate high potential, AI-adjacent companies through a thorough evaluation framework that looks beyond conventional metrics. Our unique assessment methodology is designed to identify hidden value that traditional approaches miss, creating opportunities for increased stockholder returns. We expect to generate value through strong leadership coupled with technological integration, and unlocking synergies between AI and operations that remain invisible to traditional approaches. By combining complementary capabilities, we create solutions that are greater than the sum of their parts.

The global technological landscape is experiencing a fundamental shift as the industry reaches the critical threshold where AI transforms from a promising technology to a transformative force. Through our access to M42’s proprietary integrated AI, we expect to be able to capitalize on what we see as the convergence of advanced AI, mature computing infrastructure, and market readiness. AIAI’s strategic thesis rejects the siloed application of AI and instead focuses on building an integrated ecosystem where specialized capabilities amplify each other across multiple verticals such as construction, healthcare, defense, blockchain data infrastructure, digital assets, and government services.

Our operating strategy is based on the premise that we anticipate generating a higher usage rate for our AI technology through applying it directly to the operations of our wholly-owned subsidiaries, which we believe will create greater stockholder value. We expect to implement this process through the acquisition of companies with AI integration potential as opposed to the generally accepted industry practice of marketing, selling and negotiating individual license agreements with multiple unrelated clients. By creating a captive client base through targeted entity acquisitions, consisting of those that we that acquire immediately prior to the Effective Date and those we acquire thereafter, we expect to be able to implement our AI solutions in a shorter time period (which we anticipate will take four to six months following the acquisition of the target entity) as compared to the significantly longer time required to establish a third-party licensing arrangement which in our experience can last as long as or more than 24 months to complete the full integration process. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—AIAI Holdings Corporation—Overview.” Additionally, we believe our acquisition versus licensing strategy will result in a reduced execution risk and lower pursuit costs than negotiating third-party technology licenses. A study conducted by Everest Research stated that 90% of all successful AI pilot projects were never implemented.

AIAI is not just participating in the evolution of the “cognitive revolution,” it is helping to shape it. By integrating diverse companies into a cohesive AI ecosystem, the company expects to unlock value traditional models cannot replicate. We expect to build a shared intelligence layer across our portfolio to build reusable profiles of people, processes, and industries to predict outcomes and deepen relationships. The company anticipates developing reusable profiles of how individuals think and behave, applying common analytical methods across businesses, detecting cross-company patterns invisible to single datasets, and recommending progressions of products matching individual needs. For example, in construction bidding, the system will analyze project history, team psychometrics, and procurement data to produce accurate estimates with quantified confidence factors, accounting for how project type, geography, and team composition affect delivery, thereby helping firms avoid unsustainable low bids. We believe the creation of a shared knowledge base differentiates our model from traditional AI models that typically operate in isolation, being trained for specific tasks within single companies or domains and thereby only creating siloed solutions.

With a clear vision, robust portfolio, and actionable roadmap, AIAI believes it is poised to redefine industries and deliver significant value to its stockholders. Our licensed AI brings together the branches of mathematics, science, and engineering in a loosely coupled software platform that we believe can be applied to reveal undiscerned patterns and intelligence almost anywhere.

We believe the following characteristics set us apart from our competitors:

Acquisition Strategy

Our portfolio will be a deliberately curated ecosystem, not a random collection of assets. Our target investment is one that fits within our “CURA” parameters, consisting of companies that solve complex, urgent, and/or administrative problems. Our strategy targets companies with proprietary technologies and cross-vertical potential, which are analyzed using the following criteria:

We expect to concentrate on industry sectors that we believe have high potential for both financial returns and societal impact. Our initial focus will be on the following industries:

We employ a systematic approach to portfolio development and optimization, through the application of the following guidelines:

Recent Acquisitions

Immediately prior to the Effective Date, AIAI will acquire all of the issued and outstanding equity interests of the companies listed below. The consideration payable for these entities will be the number of shares of our common stock set forth in the table below issued at the initial price of $20.00 per share. Each of the acquisition agreements provides for the issuance of additional shares of our common stock in the event the initial offering price of our common stock in the Direct Listing is less than $20.00. Pursuant to the terms of the acquisition agreements for each of these companies, the companies will continue to be operated by their existing management teams or management we specifically designate. Additionally, in certain circumstances AIAI has agreed to provide additional capital required for working capital and capital expenditure purposes pursuant to annual budgets agreed to by the management teams of AIAI and each of the acquired companies. These companies are referred to collectively in this prospectus as the “Portfolio Companies.”

Our Portfolio

The following companies will be acquired by AIAI immediately prior to the Effective Date. The company’s initial portfolio will exemplify its ecosystem acquisition strategy.

Future Acquisitions

We expect our portfolio to continue to evolve and increase to capitalize on emerging opportunities and optimize overall ecosystem value. Our management and acquisition teams maintain a deep, broad network of relationships among key market participants. We believe these relationships and our research-driven origination methods provide us access to off-market opportunities that may not be available to our competitors.

In executing our acquisition strategy, we will integrate newly-acquired entities through the application of a structured yet flexible approach to technological and operational integration, enabling consistent execution while accommodating the unique characteristics of each business. This model balances autonomy with collaboration, leveraging a shared AI platform and cross-vertical data synergies to create adaptive intelligence. This model consists of three stages:

Our Opportunity

We believe that the current stage of the evolution of the cognitive revolution marks an inflection point where AI transitions from a promising tool to a transformative force. This AI revolution represents a transformative opportunity in how businesses operate. The market in which we expect to compete includes, among others, the following elements:

SAP also reports that there remain issues with strategic adoption of AI. Most AI investment is reported to be piecemeal (44%), based on department-led prioritization (32%), or ad hoc (15%). Only 9% of businesses are investing based on strategic, holistic prioritization. We believe this fragmented adoption of AI further supports our strategy of acquiring entire companies and applying our AI on an enterprise-wide basis.

The AI landscape is hypercompetitive, with rapid innovation cycles and high capital barriers. Traditional approaches, such as siloed R&D and linear roadmaps, are expected to struggle against AIAI’s ecosystem strategy, which focuses on value optimization through integration rather than direct development. We anticipate this positioning will create measurable advantages for AIAI, including rapid market responsiveness, multidimensional value creation, and reduced risk through strategic synergy.

Acquisition Pipeline

Our executive management and acquisition team maintains a deep, broad network of relationships among a wide range of market participants, including owners and lenders. We believe these relationships, along with active participation from our board members and the management teams of the Portfolio Companies and research-driven origination methods, provide us access to multiple acquisition opportunities, many of which may not be available to any competitor. As a result of the significant need for liquidity among an ever-increasing number of privately held companies, many of which fall within our investment criteria, we believe there will be an ample supply of attractive acquisitions in the future.

In the normal course of our business, we will regularly evaluate the market for companies that fit within our investment criteria to identify potential acquisition targets. As of the date of this prospectus, we are evaluating potential acquisitions with an aggregate of approximately of $1.5 billion in EBITDA that we have identified as warranting future investment consideration after initial review. As of the date of this prospectus, we have neither entered into letters of intent nor purchase agreements with respect to any potential acquisitions nor have we begun a comprehensive due diligence review with respect to any of these companies. Accordingly, we do not believe that the acquisition of any of the companies under evaluation is probable as of the date of this prospectus. Following the completion of the Offering, we will aggressively resume discussions with our pipeline of potential acquisitions which we had paused in anticipation of engaging in the Offering and expect rapid progress.

Our Licensed Technology

We will enter into a license agreement with M42 immediately prior to the effective time of the Registration Statement of which this prospectus forms a part pursuant to which the company will be granted exclusive use of the M42 integrated Behavioral (Psychometric) (PAI) and Mathematics and Science AI (together, the “M42 AI Technology”) within the designated field of use. See “Business—License Agreement.” Additionally, as of the date of this prospectus, we indirectly own approximately 5.4% of the outstanding equity of M42. See “Business—Our Assets.”

This proprietary technology represents what we believe is an advance in how machines can understand and predict human behavior and includes certain fundamental building blocks of Math and Science designed to rapidly deploy industry independent AI solutions. A crucial but often overlooked aspect of AI is Psychometric AI’s capability for making non-obvious inferences about behavioral patterns and future actions. Most AI systems available today, outside of the technology that we are licensing from M42, are based on Machine Learning, or ML. ML includes things like generative AI—the kind of AI that can write text, draw pictures, or predict outcomes based on patterns derived from huge amounts of past data. These systems need to be “prompted” by human beings and usually learn through a trial-and-error process guided by people. The technology we are licensing works very differently. It is built on a deep base of mathematics and science inside a flexible platform that combines both PAI and traditional AI. Instead of relying mostly on ML, our licensed technology uses many different branches of computer science and AI that work together, learning from both data and behavior. This allows it to study people, markets, or companies and figure out what works best—often in hours or days instead of months. See “Business—Our Technology.”

The core principle of our licensed AI technology is that true advanced artificial intelligence should be rooted in mathematics and science but always interpreted through the lens of human experience. Unlike conventional AI, which in our experience often focuses narrowly on historic data pattern recognition and resulting learnings, PAI is engineered to capture and integrate essential human attributes such as creativity, reasoning, perception, and empathy. Mainstream AI, which is built on machine learning, statistics, and deterministic algorithms, excels at pattern recognition and language processing, but often produces outputs that lack depth, context, or genuine understanding. M42’s PAI, by contrast, delivers more nuanced, creative, and human-like results on top of the rich Math and Sciences. Our licensed AI is designed “with the end in mind,” integrating the mathematical and scientific fields to create a platform that is designed to measure up to the full breadth and depth of human intelligence.

License Agreement

Under the License Agreement, M42 will grant us a license for exclusive use of the M42 AI Technology, consisting of data sources, object code, along with industry specific template applications which are directly applicable to several of the aforementioned applications, within the designated “field of use.” As a result, M42 may not, and will cause its affiliates (other than AIAI) not to, use or exploit the licensed AI within the field of use or compete with our company within our field of use. “Field of use” is defined under the License Agreement to mean the use of the licensed AI in a business model substantially similar to our company’s business model, which includes creating and operating an AI-powered ecosystem to scale companies across multiple industry segments with the expectation of improving operating results through the application of the licensed AI technology. In addition, the License Agreement prohibits M42 from providing services or solutions to any person identified in writing by us to M42 as potential acquisition targets. Pursuant to the License Agreement, we will issue approximately 25,137,000 Shares to M42 as consideration for the perpetual use of the licensed technology. In addition, we are entering into a Technology Services Agreement with M42 concurrently with the License Agreement under which we have agreed to pay M42 a fee of 3% of our annual revenues in consideration for ongoing development work, including, among other things, any operational elements, features and functional design specifications as requested by our company. We have no further payment obligations under the License Agreement. The License Agreement permits us to sublicense the technology to and through our Portfolio Companies subject to the same terms as the License Agreement, and the sublicenses shall revert back to us in the event that a Portfolio Company is sold or that the License Agreement is terminated. The License Agreement is perpetual but may be terminated by M42 for “Cause,” which is defined to include, among other things, the bankruptcy of AIAI and AIAI’s breach of a material term of the contract that is not cured within the applicable cure period.

Summary of Risk Factors

Our business is subject to numerous risks and uncertainties that you should consider before investing in our common stock. The risks are described more fully below and include, but are not limited to, risks related to the following:

Summary of Risks Relating to our Business and Operations

Summary of Risks Related to Industry Verticals

Construction

Healthcare

Digital Assets

Summary of Risks Relating to this Offering and Ownership of Our Common Stock

Corporate Information

We were incorporated in the State of Delaware in July 2024 as MXLII Corporation. On November 3, 2025, we changed our name to AIAI Holdings Corporation. Our principal executive offices are located at 17304 Preston Road, Suite 520, Dallas, Texas 75252, and our telephone number is (214) 935-9853. Our website address is www.aiaiholdings.com. The information contained on, or that can be accessed through, our website is not incorporated by reference into, and is not part of, this prospectus or any other report or document that we file with or furnish to the SEC. Investors should not rely on such information when deciding whether to purchase our common stock.

Implications of Being an Emerging Growth Company

We qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As an emerging growth company, we are eligible to take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies and may elect to take advantage of other exemptions from reporting requirements in our future filings with the Securities Exchange Commission (“SEC”). In particular, in this prospectus, these exemptions include:

We may take advantage of these exemptions up until the last day of the fiscal year following the fifth anniversary of this offering or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.235 billion in annual revenue, we have more than $700 million in market value of our stock held by non-affiliates (and we have been a public company for at least 12 months and have filed one annual report on Form 10-K) or we issue more than $1 billion of non-convertible debt securities over a three-year period. We may choose to take advantage of some, but not all, of the available exemptions. We have taken advantage of certain reduced reporting obligations in this prospectus. Further, pursuant to Section 107 of the JOBS Act, as an emerging growth company, we have elected to use the extended transition period for complying with new or revised accounting standards until those standards would otherwise apply to private companies. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold stock, and our consolidated financial statements may not be comparable to the consolidated financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards that are applicable to public companies. See “Risk Factors—Risks Related to this Offering and Ownership of Our Common Stock” which describes that we are an emerging growth company, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information in this prospectus, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and accompanying notes, before deciding to invest in our common stock. Our business, financial condition, results of operations, or prospects could also be harmed by risks and uncertainties not currently known to us or that we currently do not believe are material. If any of the risks actually occur, our business, financial condition, results of operations, and prospects could be adversely affected. In that event, the trading price of our common stock could decline, and you could lose part or all of your investment.

Risks Related to our Business and Operations, including the Portfolio Companies

We have no operating history or established financial sources.

We have no operating history and you should not rely on the past performance of other investment programs sponsored by affiliates of our founder to predict our future results. We were formed on July 19, 2024. As of the time of the Direct Listing, we have only acquired the assets, including the Portfolio Companies, as described under the caption “Business—Our Assets.” Moreover, we do not have any established financing sources. If our capital sources are insufficient to support our operations, we will not be successful.

As a result of our limited operating history and the fact that as of the date of this prospectus our AI technology has not been applied to the operations of any of the Portfolio Companies, our ability to forecast our future results of operations is limited and subject to a number of uncertainties. A number of factors could cause our growth rate to be adversely impacted, including any reduction in the acceptance of our AI, increased competition, reduction in our overall market, our inability to accurately forecast demand for our AI, or our failure, for any reason, to capitalize on growth opportunities. We will encounter uncertainties frequently experienced by growing companies in rapidly changing industries, such as the risks and uncertainties described herein. If our assumptions regarding these risks and uncertainties, which we use to plan our business, are incorrect or change, or if we do not address these risks successfully, our business would be harmed.

You should consider our prospects in light of the risks, uncertainties, and difficulties frequently encountered by companies that are, like us, in their early stage of development.

You should consider our prospects in light of the risks, uncertainties, and difficulties frequently encountered by companies that are, like us, in their early stage of development. To successfully implement our business strategy, we must, among other things:

Our business depends on our ability to attract new Portfolio Companies.

To increase our revenue, we will need to attract and acquire additional Portfolio Companies. Our success will depend to a substantial extent on the widespread understanding and acceptance of our AI. Although the demand for artificial intelligence and its applications has increased in recent years, the market for these applications has continued to evolve.

Our business strategy depends on achieving revenue growth from anticipated increases in operating results from the application of our AI technology to the operations of the Portfolio Companies.

Our business strategy depends on achieving revenue growth from anticipated near-term increases in the operating results of our Portfolio Companies resulting from the application of our AI technology to their business operations. As a result, any delay in or failure to the complete implementation of our AI technology within the operations of our Portfolio Companies, or a weaker than anticipated improvement in such business operations from the application of our technology, could materially and adversely affect us and our growth prospects. Further, even if we are successful in fully integrating our technology into the business operations of our Portfolio Companies, the increases in operating results could be significantly less than our projections at the time of acquisition.

We may not be aware of characteristics of or deficiencies in the operations or assets of the companies that we acquire, which could have a material adverse effect on our business.

While we have established a robust due diligence review process for each of our acquisitions, newly acquired businesses may have characteristics or deficiencies unknown to us that could affect their valuation or revenue potential, and such companies may not ultimately perform to our expectations. We cannot assure you that the operating performance of any newly acquired companies will not decline under our management. Any characteristics or deficiencies in any newly acquired companies that adversely affect the value of the companies or their revenue-generation potential could have a material adverse effect on our results of operations and financial condition.

We may be unable to identify and complete acquisitions of additional Portfolio Companies that meet our investment criteria, which may have a material adverse effect on our growth prospects.

Our primary investment strategy involves the acquisition of companies with high potential for increased operating results through the application of AI. These activities require us to identify suitable acquisition candidates that meet our investment criteria and are compatible with our growth strategies. We may not be able to acquire companies identified as potential acquisition opportunities. Our ability to acquire companies on favorable terms, or at all, may expose us to the following significant risks:

If we are unable to acquire companies on favorable terms, or at all, our financial condition, results of operations, cash flows, and our ability to pay dividends on, and the per share trading price of our common stock, could be adversely affected. In addition, failure to identify or complete acquisitions of suitable companies could limit our growth.

If we fail to manage our growth effectively, our expenses could increase more than expected, our revenue may not increase proportionately or at all, and we may not be able to execute on our business strategy.

We expect that the number of our Portfolio Companies will increase significantly over the next couple of years. To manage our anticipated future growth effectively, we must maintain and enhance our financial and accounting systems and our IT infrastructure. Failure to effectively manage our growth could also lead us to over-invest or under-invest in development and operations, result in or exacerbate weakness in our infrastructure, systems, or controls give rise to operational mistakes, financial losses, loss of productivity or business opportunities, and result in loss of employees and reduced productivity of remaining employees. Our growth may also require significant capital expenditures. As we expand and make related upfront capital expenditures, our margins may be reduced until we recognize growth, if any, resulting from such capital expenditures. If our management is unable to effectively manage our growth, our expenses may increase more than expected, our revenue may not increase or may grow more slowly than expected, and we may be unable to implement our business strategy, which would adversely affect our business, results of operations, and financial condition.

Our acquisition activities may pose risks that could harm our business.

As a result of our future acquisitions, we may be required to incur debt and expenditures and issue additional shares of our common stock to pay for the acquired companies. These acquisitions may dilute our stockholders’ ownership interests, delay or prevent our profitability, and may expose up to risks such as:

We cannot assure you that the price for any future acquisitions will be similar to the prices paid for the existing Portfolio Companies. If our revenue does not keep pace with our potential acquisition and expansion costs, we may incur net losses. There is no assurance that we will successfully overcome these risks or other problems encountered with acquisitions.

We are highly dependent on the key personnel of AIAI and the management teams of each of the Portfolio Companies. If we are not successful in attracting, motivating and retaining highly qualified personnel, we may not be able to successfully implement our business strategy.

Our ability to compete in the highly competitive industries in which we are engaged depends upon our ability to attract, motivate and retain highly qualified managerial personnel. We are highly dependent on the AIAI management and the management team of each of the Portfolio Companies. Although we have employment agreements with the senior executives of AIAI, substantially all of the key personnel of the Portfolio Companies do not have employment agreements and those that do exist provide for at-will employment, which means that any our employees could leave our employment at any time, with or without notice. From time to time, there may be changes to the AIAI executive team resulting from new hires or departures of executives, which could disrupt our business. Additionally, we currently do not have “key person” insurance on any of our employees.

Recruiting and retaining qualified employees, consultants and advisors for our businesses also will be critical to our success. Competition for skilled personnel is intense and the turnover rate can be high. This competition for and scarcity of qualified talent may drive increases in compensation and benefits for skilled personnel. This may increase our human capital costs, and we may not be able to attract and retain personnel on acceptable terms given the competition among numerous technology companies and academic institutions for skilled individuals. The replacement of one or more AIAI executive officers or other key employees would likely involve substantial costs and may significantly delay or prevent the achievement of our business objectives. Our business would be harmed if we fail to adequately plan for the succession of our executives or if we fail to effectively recruit, integrate, retain, and develop key talent and align our talent with our business needs, which could have a material adverse effect on our business, financial condition, results of operations, stock price, and prospects.

To induce valuable employees to remain at our company, in addition to salary and cash incentives, we expect to provide stock grants that vest over time. The value to employees of these equity grants that vest over time may be significantly affected by movements in our stock price that are beyond our control and may at any time be insufficient to counteract more lucrative offers from other companies.

Our management team has limited public company experience.

Most of the members of our management team have limited public company experience. Our entire management team, as well as other of our personnel, will need to devote substantial time to compliance, and may not effectively or efficiently manage our transition into a public company. If we are unable to effectively comply with the regulations applicable to public companies or if we are unable to produce accurate and timely financial statements, which may result in misstatements that may be material in our financial statements or possible restatement of financial results, our stock price may be materially adversely affected. Any such failures could also result in litigation or regulatory actions by the SEC or other regulatory authorities, loss of investor confidence, delisting of our securities, harm to our reputation and diversion of financial and management resources from the operation of our business, any of which could materially adversely affect our business, financial condition, results of operations, and growth prospects. Additionally, the failure of a key employee to perform in his or her current position could result in our inability to continue to grow our business or to implement our business strategy.

We will need to continue to expand the size of our organization, and we may experience difficulties in managing this growth, which could disrupt our operations.

As our acquisition and commercialization plans and strategies develop, and as we transition into operating as a public company, we expect to need additional managerial, operational, sales, marketing, financial and other personnel. Future growth would impose significant added responsibilities on members of management, including:

Our future financial performance and our ability to commercialize newly developed AI innovations will depend, in part, on our ability to effectively manage any future growth, and our management may also have to divert a disproportionate amount of its attention away from day-to-day activities in order to devote a substantial amount of time to managing these growth activities.

We currently rely, and for the foreseeable future will continue to rely, in substantial part, on certain independent organizations, advisors and consultants to provide certain services. We cannot assure you that the services of independent organizations, advisors and consultants will continue to be available to us on a timely basis when needed, or that we can find qualified replacements. In addition, if we are unable to effectively manage our outsourced activities or if the quality or accuracy of the services provided by consultants is compromised for any reason, our ability to apply our AI technology to Portfolio Companies may be delayed or terminated. We cannot assure you that we will be able to manage our existing consultants or find other competent outside contractors and consultants on economically reasonable terms, or at all.

Our Chief Executive Officer, Todd Furniss, may experience conflicts of interest from engaging in outside business activities.

The employment agreement with Mr. Furniss, our Chief Executive Officer, permits him to engage in certain designated external activities in addition to his obligations as our Chief Executive Officer. Mr. Furniss will, therefore, have a conflict of interest in allocating his time between his external obligations and his obligations to our company. We anticipate that Mr. Furniss engagement in these external activities will not require more than 15 hours a month, and accordingly, we believe that he will be able to devote substantially all of his working time to overseeing our operations. In addition, these outside duties do not conflict with or are otherwise competitive to AIAI’s business.

Unfavorable market and economic conditions may have serious adverse consequences on our business, financial condition, results of operations, stock price and prospects.

Our results of operations could be adversely affected by general conditions in the global economy and in the global financial markets. A severe or prolonged economic downturn could result in a variety of risks to our business, including a reduced ability to raise additional capital when needed on acceptable terms, if at all. A weak or declining economy could also strain our suppliers, possibly resulting in supply disruption. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the economic climate and financial market conditions could adversely impact our business.

If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, we could experience adverse consequences resulting from such compromise, including, but not limited to, regulatory investigations or actions, litigation, fines and penalties, disruptions of our business operations, reputational harm, loss of revenue or profits, loss of customers or sale, and other adverse consequences.

In the ordinary course of our business, we may process, collect, store, and transmit proprietary, confidential, and sensitive data, including personal data, intellectual property, proprietary business information and trade secrets (collectively, sensitive information). We may rely upon third-party service providers and technologies to operate critical business systems to process sensitive information in a variety of contexts, including, without limitation, third-party providers of information technology infrastructure, cloud-based infrastructure, encryption and authentication technology, employee email, content delivery to customers, and other functions. Our ability to monitor these third parties’ information security practices is limited, and these third parties may not have adequate information security measures in place. We may share or receive sensitive information with or from third parties.

Cyber-attacks, malicious internet-based activity, and online and offline fraud are prevalent and continue to increase. These threats are becoming increasingly difficult to detect. These threats come from a variety of sources, including traditional computer “hackers,” “hacktivists,” threat actors, personnel (through theft or misuse), sophisticated nation states, and nation-state-supported actors. Some actors now engage and are expected to continue to engage in cyber-attacks, including without limitation nation-state actors for geopolitical reasons and in conjunction with military conflicts and defense activities. During times of war and other major conflicts, we and the third parties upon which we rely may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our goods and services. We and the third parties upon which we rely may be subject to a variety of evolving threats, including, without limitation, social-engineering attacks (including through phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks (such as credential stuffing), personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, power grid disruptions and electrical service interruptions, earthquakes, fires, floods, tornadoes, and other similar threats. Ransomware attacks, including by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations, disruption of clinical trials, loss of data (including data related to clinical trials), and income, reputational harm, and diversion of funds. Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments. Similarly, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties and infrastructure in our supply chain or our third-party partners’ supply chains have not been compromised or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to our information technology systems or the third-party information technology systems that support us and our services.

Remote work has become more common and has increased risks to our information technology systems and data, as more of our employees and employees of third parties on which we rely utilize network connections, computers, and devices outside our premises or network, including working at home, while in transit and in public locations.

Future or past business transactions (such as acquisitions or integrations) could expose us to additional cybersecurity risks and vulnerabilities, as our systems could be negatively affected by vulnerabilities present in acquired or integrated entities’ systems and technologies.

Any of the previously identified or similar threats could cause a security incident or other interruption. A security incident or other interruption could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration, encryption, disclosure of, or access to our sensitive information. A security incident or other interruption could disrupt our ability (and that of third parties upon whom we rely) to provide our services and products. For example, the loss of clinical trial data from completed or ongoing or planned clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

We may expend significant resources or modify our business activities (including our clinical trial activities) to try to protect against security incidents. Certain data privacy and security obligations may require us to implement and maintain specific security measures, industry-standard or reasonable security measures to protect our information technology systems and sensitive information.

While we have established physical, electronic and organizational security measures to safeguard and secure our systems against security incidents, and rely on commercially-available systems, software, tools, and monitoring to provide security for our information technology systems and the processing, transmission and storage of digital information, there can be no assurance that these measures will be effective. We may be unable in the future to detect vulnerabilities in our information technology systems because such threats and techniques change frequently, are often sophisticated in nature, and may not be detected until after a security incident has occurred. Despite our efforts to identify and address vulnerabilities, if any, in our information technology systems, our efforts may not be successful. Further, we may experience delays in developing and deploying remedial measures designed to address any such identified vulnerabilities.

Applicable data privacy and security obligations may require us to notify relevant stakeholders of security incidents. Such disclosures are costly, and the disclosure or the failure to comply with such requirements could lead to adverse consequences. If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences. These consequences may include: government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing sensitive information (including personal data); litigation (including class claims); indemnification obligations; negative publicity; reputational harm; monetary fund diversions; interruptions in our operations (including availability of data); financial loss; and other similar harms. Security incidents and attendant consequences may have negative impacts to our reputation and cause customers to stop using our products, deter new customers from using our products, and negatively impact our ability to grow and operate our business.

Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and security obligations. We cannot be sure that our insurance coverage will be adequate or sufficient to protect us from or to mitigate liabilities arising out of our privacy and security practices, that such coverage will continue to be available on commercially reasonable terms or at all, or that such coverage will pay future claims.

Litigation arising in the ordinary course of business, including in connection with commercial disputes or employment claims, against us could be costly and time-consuming to defend.

We are subject, and in the future may become subject from time to time, to legal proceedings and claims that arise in the ordinary course of business such as claims brought by our partners in connection with commercial disputes, consumer class action claims, employment claims made by our current or former employees or other claims or proceedings. Litigation may result in substantial costs, settlement and judgments and may divert management’s attention and resources, which may substantially harm our business, financial condition and results of operations. Insurance may not cover such claims, may not provide sufficient payments to cover all of the costs to resolve one or more such claims and may not continue to be available on terms acceptable to us. A claim brought against us that is uninsured or underinsured could result in unanticipated costs, thereby leading analysts or potential investors to reduce their expectations of our performance, which could reduce the market price of our common stock.

Our employees, independent contractors, consultants, or commercial partners may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements and insider trading, which could have a material adverse effect on our business.

We are exposed to the risk of employee fraud or other misconduct. Misconduct by employees, independent contractors, consultants, or commercial partners could include intentional, reckless, negligent, or unintentional failures to comply with government regulations, comply with applicable fraud and abuse laws, provide accurate information to third parties, including governmental agencies, report financial information or data accurately, or disclose unauthorized activities to us. This misconduct could also involve the improper use or misrepresentation of information obtained in the course of conducting our business operations, which could result in litigation or regulatory sanctions and serious harm to our reputation. It is not always possible to identify and deter this type of misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. In addition, we are subject to the risk that a person or government could allege such fraud or other misconduct, even if none occurred. If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, financial condition, results of operations, stock price and prospects, including the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgement, possible exclusion from participation in government programs, integrity oversight and reporting obligations to resolve allegations of non-compliance, imprisonment, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of our operations.

We face intense competition and could lose acquisition opportunities to our competitors, which could adversely affect our business, financial condition and results of operations.

The market for AI products is intensely competitive and characterized by rapid changes in technology, customer requirements, industry standards, and frequent new platform and application introductions and improvements. We anticipate continued competitive challenges from current competitors who may be able to provide services to potential acquisition candidates in a manner that is more cost effective and operationally attractive to management of these entities, and in many cases, these competitors are more established and enjoy greater resources than we do. We also expect competitive challenges from new entrants into the industry. If we are unable to anticipate or effectively react to these competitive challenges, our ability to continue to acquire companies which are receptive to the application of our AI could be reduced, and we could experience a decline in our growth rate and revenue that could adversely affect our business and results of operations.

Our main sources of current and potential competition fall into several categories:

Many of our existing competitors have, and some of our potential competitors could have, substantial competitive advantages such as:

In addition, some of our larger competitors have substantially broader and more diverse platform and application offerings and may be able to leverage their relationships with distribution partners and customers based on other products or incorporate functionality into existing products to gain business in a manner that discourages potential acquisition candidates from agreeing to be purchased by us. If we are unable to sufficiently differentiate our solutions from the integrated or bundled products of our competitors, such as by offering enhanced functionality, performance, or value, we may see a decrease in demand for our AI, which could adversely affect our business, operating results, and financial condition.

If we fail to respond to rapid technological changes, extend our AI applicability, or develop new features and functionality, our ability to remain competitive could be impaired.

The market for AI is characterized by rapid technological change and frequent new platform and application introductions and enhancements, changing customer demands, and evolving industry standards. The introduction of platforms and applications embodying new technologies can quickly make existing platforms and applications obsolete and unmarketable. The success of the application to the operations of our Portfolio Companies of any enhancements or improvements to our existing AI or any new applications depends on several factors, including timely completion, adequate quality testing, integration with existing technologies, and overall market acceptance.

Our ability to continue to attract additional Portfolio Companies will likely depend on our ability to enhance and improve our AI, to develop additional functionality and use cases, introduce new features and applications and interoperate across an increasing range of devices, operating systems, and third-party applications. Potential acquisition entities may require features and capabilities that our current AI does not have or may face use cases that our current AI does not address. We will invest significantly, through our license agreement with M42, in customizing and enhancing the AI to improve the quality and ease of the application of our AI to the business operations of our Portfolio Companies. There is no assurance that any enhancements to our AI will achieve those objectives. If these research and development investments do not accurately anticipate operational demand, we may be unable to acquire additional Portfolio Companies.

Any failure of our AI to be effectively applied to our existing or future Portfolio Companies could reduce the demand for our AI and, therefore, limit our ability to grow through the acquisition of additional Portfolio Companies. If we are unable to adapt our AI in a timely and cost-effective manner, our AI may become less marketable, less competitive, or obsolete, and our operating results may be adversely affected.

The introduction of new AI platforms and applications by competitors or the development of entirely new technologies to replace existing offerings could make our AI obsolete or adversely affect our business, results of operations, and financial condition. We may experience difficulties with software development, design, or marketing that could delay or prevent our development, introduction, or implementation of any new AI application experiences, features, or capabilities which may be required by existing or future Portfolio Companies. Any delays could result in adverse publicity, loss of revenue, or reduction in market acceptance, all of which could harm our business. Moreover, new productivity features for our AI may require substantial investment, and we have no assurance that such investments will be successful. If new entities do not widely adopt any new AI application features and capabilities, we may not be able to increase the number of Portfolio Companies.

Our actual or perceived failure to comply with privacy, data protection and information security laws, regulations, and obligations could harm our business.

Certain of our operations may subject us to numerous federal, state, local, and international laws and regulations regarding privacy, data protection, information security and the storing, sharing, use, processing, transfer, disclosure, and protection of personal information and other content, the scope of which is changing, subject to differing interpretations and may be inconsistent among countries, or conflict with other rules. We are also subject to the terms of our privacy policies and obligations to third parties related to privacy, data protection, and information security. We strive to comply with applicable laws, regulations, policies, and other legal obligations relating to privacy, data protection, and information security to the extent possible. However, the regulatory framework for privacy and data protection worldwide is, and is likely to remain, uncertain for the foreseeable future, and it is possible that these or other actual or alleged obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or our practices.

The existing and emerging laws and regulations impose new and relatively burdensome obligations, and with substantial uncertainty over the interpretation and application of these and other laws and regulations, there is a risk that the requirements of these laws and regulations, or of contractual or other obligations relating to privacy, data protection, data use, or information security, are interpreted or applied in a manner that is, or is alleged to be, inconsistent with our management and processing practices, our policies or procedures, or the features of our AI. We may face challenges in addressing their requirements and making necessary changes to our policies and practices and may incur significant costs and expenses in an effort to do so. Although we endeavor to comply with our published policies, certifications, and documentation, we may at times fail to do so or may be perceived to have failed to do so. Moreover, despite our efforts, we may not be successful in achieving compliance if our employees or vendors fail to comply with our published policies and documentation. Additionally, if third parties we work with, such as developers, violate applicable laws or regulations or our policies, such violations may have an adverse effect on our business, Any failure or perceived failure by us to comply with our privacy policies, our privacy-, data protection-, data use-, or information security-related obligations to customers or other third parties or any of our other legal obligations relating to privacy, data protection, data use, or information security may result in governmental investigations or enforcement actions, litigation, claims, or public statements against us by consumer advocacy groups or others, and could result in significant liability or cause our customers to lose trust in us, which could have an adverse effect on our reputation and business. Furthermore, the costs of compliance with, and other burdens imposed by, the laws, regulations, and policies that are applicable to the businesses of our Portfolio Companies may limit the adoption and use of, and reduce the overall demand for, our AI.

Any significant change to applicable laws, regulations or industry practices regarding the collection, use, retention, security, or disclosure of our information, or regarding the manner in which the express or implied consent of customers for the collection, use, retention, or disclosure of such information is obtained, could increase our costs and require us to modify our AI, possibly in a material manner, which we may be unable to complete and may limit our ability to store and process data or develop new applications and features.

Cybersecurity and data privacy incidents or breaches may inhibit our growth.

The confidentiality and security of our information, and that of third parties, is critical to our business. Our services involve the transmission, use, and storage of information, which may be confidential or contain personally identifiable information. Any cybersecurity or data privacy incidents could have a material adverse effect on our results of operations and financial condition. While we maintain a broad array of information security and privacy measures, policies and practices, our networks may be breached through a variety of means, resulting in someone obtaining unauthorized access to our information, to information of our Portfolio Companies, or to our intellectual property; disabling or degrading service; or sabotaging systems or information. Unauthorized parties may also attempt to gain access to our systems or facilities, or those of our Portfolio Companies, through fraud or other forms of deceiving our employees, contractors, and vendors. Because the techniques used to obtain unauthorized access, or to sabotage systems, change frequently and generally are not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. We will continue to incur significant costs to continuously enhance its information security measures to defend against the threat of cybercrime. Any cybersecurity or data privacy incident or breach may result in:

Our brand, reputation and ability to attract and serve our Portfolio Companies are dependent in part upon the reliable performance of our technology.

Our brand, reputation, and ability to attract and serve our Portfolio Companies are dependent in part upon the reliable performance of, and our ability to apply, our AI to operations of our Portfolio Companies and their ability to access our AI. Interruptions in our systems, whether due to system failures, computer viruses, physical or electronic break-ins, or other factors, could affect the security or availability of our AI. Problems with the reliability or security of our systems could harm its reputation. Damage to our reputation and the cost of remedying these problems could negatively affect our business, financial condition, and operating results.

Risks Related to Industry Verticals

Construction Risks which are applicable to the operations of C.C. Carlton Industries, Ltd.

If we are unable to accurately estimate the overall risks, requirements, or costs when we bid on or negotiate a contract that is ultimately awarded to us, we may achieve a lower than anticipated profit or incur a loss on the contract.

The majority of our construction revenue and backlog are derived from fixed unit price contracts, cost plus contracts, and lump sum contracts. The nature of our contracts, particularly those that are fixed-price, subjects us to risks associated with cost overruns, operating cost inflation and potential claims for liquidated damages. Fixed unit price contracts require us to provide materials and services at a fixed unit price based on approved quantities irrespective of our actual per unit costs. Lump sum contracts require that the total amount of work be performed for a single price irrespective of our actual per unit costs. We realize a profit on our contracts only if we accurately estimate our costs and then successfully control actual costs and avoid cost overruns, and our revenue exceed actual costs. If our cost estimates for a contract are inaccurate, or if we do not execute the contract within our cost estimates, then cost overruns may cause us to incur losses or cause the contract not to be as profitable as we expected. The final results under these types of contracts could negatively affect our business, financial condition, results of operations and cash flows.

The costs incurred and gross margin realized on our contracts can vary, sometimes substantially, from our original projections due to a variety of factors, including, but not limited to:

Many of our contracts contain provisions that purport to shift some or all of the above risks from the customer to us, even in cases where the customer is partly at fault. Our experience has often been that public customers have been willing to negotiate equitable adjustments in the contract compensation or completion time provisions if unexpected circumstances arise. However, public customers may seek to impose contractual risk-shifting provisions more aggressively or there could be statutory and other legal prohibitions that prevent or limit contract changes or equitable adjustments, which could increase risks and adversely affect our business, financial condition, results of operations and cash flows.

Our failure to meet the schedule or performance requirements of our contracts could adversely affect us.

In most cases, our contracts require completion by a scheduled acceptance date. Failure to meet any such schedule could result in additional costs, penalties or liquidated damages being assessed against us, and these could exceed projected profit margins on the contract. Performance problems on existing and future contracts could cause actual results of operations to differ materially from those anticipated by us and could cause us to suffer damage to our reputation within the industry and among our customers.

Our future growth depends, in part, on sales to government entities, which are subject to a number of challenges and risks.

We derived approximately 10% and 10%, respectively, of our revenue from sales of our platform and products to federal, state, local, and foreign governments and public universities in fiscal 2024 and fiscal 2025, and a part of our growth strategy is to pursue successful procurement of government and other public sector contracts. Factors that could impede our ability to maintain or increase the amount of revenue derived from the public sector include:

The occurrence of any of the foregoing could cause governments, governmental agencies, and others in the public sector to delay or refrain from purchasing our platform and products or otherwise have an adverse effect on our business, operating results, and financial condition.

Additionally, the sale of our platform and products to the public sector is tied to budget cycles, and there are government requirements and authorizations that we may be required to meet. Further, we may be subject to audits and investigations relating to the contracts we enter into with the public sector, and violations could result in penalties and sanctions, including contract termination, refunding or forfeiting payments, fines and suspension, or debarment from future public sector business. Selling to these entities can be highly competitive, expensive, and time consuming, often requiring significant upfront time and expense. Public sector entities often require contract terms that differ from our standard arrangements and impose additional compliance requirements, require increased attention to pricing practices, or are otherwise time consuming and expensive to satisfy. For example, some of our government entity customers contract with us on the basis of our authorization under the U.S. Federal Risk and Authorization Management Program (“FedRAMP”), which has in the past required and may in the future require us to undertake additional actions and expense to ensure compliance. Public sector entities may also have statutory, contractual, or other legal rights to terminate contracts with us or our partners for convenience, for lack of funding, or due to a default, and any such termination may adversely impact our future results of operations. If we represent that we meet certain standards, authorizations (such as FedRAMP), or requirements and do not meet them, or if such authorizations are suspended or revoked, we could be subject to increased liability from our customers, investigation by regulators, or termination rights. Even if we do meet them, the additional costs associated with providing our service to public sector entities could harm our margins. Moreover, changes in underlying regulatory requirements could be an impediment to our ability to efficiently provide our service to public sector customers and to grow or maintain our customer base. Any of these risks related to contracting with public sector entities could adversely impact our future sales and results of operations or make them more difficult to predict.

Our operations are subject to hazards that may cause personal injury or property damage. Failure to maintain safe work sites could subject us to liabilities and possible losses, which may not be covered by insurance.

Construction and maintenance sites, plants and quarries are potentially dangerous workplaces subject to the usual hazards associated with providing construction and related services, and our employees and others are often put in close proximity with mechanized equipment, moving vehicles, chemical and manufacturing processes and highly regulated materials. Operating hazards can cause personal injury and loss of life, damage to or destruction of property, plant and equipment and environmental damage.

On many sites, we are responsible for safety and, accordingly, must implement safety procedures. If we fail to implement these procedures or if the procedures we implement are ineffective, we may suffer the loss of or injury to our employees or others, as well as expose ourselves to possible litigation. Despite having invested significant resources in safety programs and being recognized as an industry leader, a serious accident may nonetheless occur on one of our worksites. As a result, our failure to maintain adequate safety standards could result in reduced profitability or the loss of projects or customers and could have a material adverse impact on our business, financial condition, results of operations, and cash flows.

We maintain general liability and excess liability insurance, workers’ compensation insurance, auto insurance and other types of insurance all in amounts consistent with our risk of loss and industry practice, but this insurance may not be adequate to cover all losses or liabilities that we may incur in our operations. Insurance liabilities are difficult to assess and quantify due to unknown factors, including the severity of an injury, the determination of our liability in proportion to other parties, the number of incidents not reported and the effectiveness of our safety program. If we were to experience insurance claims or costs above our estimates, we might be required to use working capital to satisfy these claims rather than to increase operations.

To the extent that we experience a material increase in the frequency or severity of accidents or workers’ compensation and health claims, or unfavorable developments on existing claims, our results of operations and financial condition could be materially and adversely affected.

Supply chain disruptions may adversely affect our operations.

At times or in certain markets, we rely on third-party vendors and manufacturers to supply or transport many of the materials necessary for our operations. Disruptions, shortages or delays in the transportation of materials; price increases from suppliers or manufacturers; or inability to source needed materials have occurred and may continue to occur, which could adversely affect our results of operations, financial condition, cash flows and harm customer relationships. National and regional demand for cement and liquid asphalt may at times outpace the supply in the market. This imbalance creates a temporary shortage which may cause prices to increase faster than downstream products. Any material disruption at the facilities of our suppliers or otherwise within its supply chain, whether as a result of downtime, pandemic-related shutdowns, work stoppages or facility damage could prevent us from meeting customer demands or expected timelines, require us to incur unplanned capital expenditures, or cause other material disruptions to our operations, any of which could have a material adverse effect on our operations, financial position and cash flows. Further, supply chain disruptions can occur from events out of our control such as fires, floods, severe weather, natural disasters, environmental incidents or other catastrophes.

Adverse weather conditions may cause construction delays, which could slow completion of our contracts and negatively affect our revenue and cash flows.

Because all of our construction projects are built outdoors, work on our contracts is subject to unpredictable weather conditions. Severe weather events, such as tornadoes, hurricanes, rain, drought, ice and snowstorms, and high- and low- temperature extremes, occur in regions in which we operate and maintain infrastructure. Climate change could change the frequency and severity of these weather events, which may create physical and financial risks to our operations. Such risks could have an adverse effect on our financial condition, results of operations and cash flows. Increases in severe weather conditions or extreme temperatures may cause infrastructure construction projects to be delayed or canceled and limit resources available for such projects resulting in decreased revenue or increased project costs. In addition, drought conditions could restrict the availability of water supplies or limit the ability to obtain water use permits, inhibiting the ability to conduct operations. To date, our construction operations have not experienced any material impacts to their financial condition, results of operations or cash flows due to severe weather or the other physical effects of climate change.

The insurance industry may be adversely affected by severe weather events, which may impact availability of insurance coverage, insurance premiums and insurance policy terms.

Increased costs of labor and materials may materially adversely affect our business, results of operations or financial condition.

Higher than expected costs of labor and materials, including transportation costs related to increased fuel pricing, may adversely affect our ability to realize profits on our construction projects. Inflation, interest rate impacts on our suppliers’ pricing, and supply chain failures are potential causes for such increased costs. It is difficult to accurately project these costs when bidding on a project, and there is no guarantee that we will be able to pass these higher costs on to our customers. As a result, an increase in such costs could have a material adverse effect on our business, results of operations, or financial condition.

Recent inflationary pressures have materially impacted our operations and may continue to do so in the future. Specifically, we have experienced delayed commencement dates on projects as we have had to revise budgets and proposals to account for the rising costs of labor and materials. Inflation has caused the prices of key construction materials, such as steel, lumber, and concrete, to rise substantially. These increased costs have made projects more expensive overall, which, in turn, could materially affect the number of new contracts awarded to us. Additionally, stronger lending requirements, elevated borrowing costs and increased financing rates have delayed our clients in securing construction loans, further impacting project timelines. While most of these inflationary costs are passed directly to the consumer as a pass-through cost, the cumulative effect of these delays and increased costs have and may continue to have a significant adverse impact on our profitability and cash flow, particularly if we are unable to fully recover these costs from our clients.

Adverse economic conditions that impact consumer spending may materially affect our business.

Our business, as well as the businesses of our partners, is significantly influenced by general economic conditions. Economic downturns, recessions, or periods of economic uncertainty can lead to reduced consumer spending, which may have a material adverse effect on our construction and development projects. During economic downturns, consumers often reduce spending, including on new homes and commercial properties. This reduction in consumer spending can lead to decreased demand for our construction and development services, resulting in lower revenues and profitability.

Economic conditions can also impact the availability and cost of financing for our projects. Tightened credit markets and higher interest rates can make it more difficult and expensive for us and our partners to secure the necessary funding for ongoing and future projects. This can delay or halt project development, further impacting our financial performance. Economic instability can lead to disruptions in the supply chain, affecting the availability and cost of materials and labor. Increased costs and delays in obtaining necessary resources can negatively impact project timelines and budgets, reducing our overall profitability. Economic conditions can also lead to increased market volatility, affecting property values and investment returns. Fluctuations in real estate markets can impact the valuation of our projects and the ability to sell or lease properties at favorable terms, further affecting our financial stability.

Failure to maintain safe work sites could result in significant losses, which could materially affect our business and reputation.

Because our employees and others are often in close proximity with mechanized equipment, moving vehicles, and chemical substances, our construction and maintenance sites are potentially dangerous workplaces. Therefore, safety is a primary focus of our business and is critical to our reputation and performance. Many of our clients require that we meet certain safety criteria to be eligible to work on the project. Unsafe work conditions, including OSHA violations, also can increase employee and subcontractor turnover, which increases project costs and therefore our overall operating costs. If we fail to implement safety procedures, implement ineffective safety procedures or fail to have adequate insurance policies in place, our employees and subcontractors could be injured, and we could be exposed to investigations and possible litigation. Our failure to maintain adequate safety standards through our safety programs could also result in reduced profitability or the loss of projects or clients and could have a material adverse impact on our financial position, results of operations, cash flows or liquidity.

Our failure to meet the schedule or performance requirements of our contracts could adversely affect us.

In most cases, our contracts require completion by a scheduled acceptance date. Failure to meet any such schedule, unless the result of non-fault issues such as force majeure, could result in additional costs, penalties or liquidated damages being assessed against us, and these could exceed projected profit margins on the contract. Performance problems on existing and future contracts, such as material shortages, changes to the scope of work or subcontractor performance, could cause actual results of operations to differ materially from those anticipated by us and could cause us to suffer damage to our reputation within the industry and among our clients.

We could incur material costs and losses as a result of claims that our materials do not meet regulatory requirements or contractual specifications.

We provide our customers with materials designed to comply with building codes or other regulatory requirements, as well as any applicable contractual specifications. If our materials do not satisfy these requirements and specifications, material claims may arise against us, our reputation could be damaged and, if any such claims are for an uninsured, non-indemnified or product-related matter, then resolution of such claim against us could have a material adverse effect on our financial condition, results of operations or liquidity.

Our results of operations fluctuate from quarter to quarter and from year to year as they are affected, among other things, by the seasonal nature of the construction industry.

Our results of operations experience substantial fluctuations from quarter to quarter and year to year. Any negative economic conditions that occur during the months of traditionally higher sales of a given product could have a disproportionate effect on our results of operations for the entire fiscal year. We may also make strategic decisions to deliver and invoice customers at certain dates to lower costs or improve supply chain efficiencies or may be forced to do so because of supply chain issues or disruption. As a result, our results of operations are likely to fluctuate significantly from period to period such that any historical results should not be considered indicative of the results to be expected for any future period. In addition, we incur significant additional expenses in the periods leading up to the beginning of new projects which may also result in fluctuations in our results of operations. Our annual and quarterly gross profit margins are also sensitive to a number of factors, many of which are beyond our control. This seasonality in revenues, expenses and margins, along with other factors that are beyond our control, including general economic conditions, changes in consumer preferences, weather conditions, including major weather events such as hurricanes, geopolitical uncertainty, the cost or availability of raw materials or labor, discretionary spending habits and currency exchange rate fluctuations, could materially adversely affect our business, results of operations or financial condition.

We are subject to laws, rules and regulations regarding safety, health, environmental and noise pollution and other issues that could cause us to incur fines or penalties or increase our operating costs.

We are subject to federal, state local, and municipal laws, rules and regulations in the United States regarding product safety, health, environmental and noise pollution and other issues that could cause us to incur fines or penalties or increase our operating costs, all of which could have a material adverse effect on our business, results of operations or financial condition. Namely, we are required to comply with the Occupational Safety and Health Act of 1970, which helps to ensure safe and healthy working conditions for workers by setting and enforcing standards and by providing training, outreach, education, and assistance. A failure to comply with, or compliance with, any such requirements or any new requirements could result in increased expenses to modify our products, or harm to our reputation, which could have a material adverse effect on our business, results of operations or financial condition.

Healthcare risks which are applicable to the operations of gTC MediGuide and Vanguard Healthcare Solutions

We operate in a competitive industry, and if we are not able to compete effectively, our business, results of operations and financial condition would be harmed.

The market for health care and the services related thereto is competitive. We compete in a highly fragmented market with direct and indirect competitors that offer varying levels of impact to key stakeholders such as patients, clinicians, payor partners, and primary care and other specialist physician partners. Our competitive success is contingent on our ability to address the needs of key stakeholders efficiently and with superior outcomes at scale compared with competitors. We compete across various segments within the health care market, including with respect to traditional health care providers and medical practices, technology platforms, care management and coordination, digital health, telehealth and health information exchange. Competition in our market involves changing technologies, evolving regulatory requirements and industry expectations, and changes in clinician and patient needs. If we are unable to keep pace with the evolving needs of our patients and clinicians and the evolving competitive landscape in a timely and efficient manner, demand for our services may be reduced and our business, financial condition and results of operations would be harmed.

Our competitors primarily include other medical and healthcare service providers that deliver care in-person or through virtual visits. Our indirect competitors also include episodic consumer-driven point solutions, such as in-person and virtual life coaching, digital therapy and support tools and other technologies related to health care services. In addition to established health providers, we may face additional competition from new market entrants, including major retailers that have recently begun to offer in-person and virtual health care in certain markets. Generally, practices, certain hospitals, and other outpatient health providers in the local communities we serve provide services similar to those we offer, and, in some cases, our competitors may offer a broader array of services, more flexible hours or more desirable locations to patients and outpatient health providers than ours, and may have larger or more specialized medical staffs to serve patients. Furthermore, health care consumers are now able to access patient satisfaction data, as well as standard charges for services, to compare competing outpatient health providers; if any of our centers or our affiliated practices achieve poor results (or results that are lower than our competitors’) on patient satisfaction surveys, or if our standard charges are or are perceived to be higher than our competitors, we may attract fewer patients. Additional quality measures and trends toward clinical or billing transparency, including recently enacted price transparency rules that would require third-party payors to make their pricing information publicly available, may have a negative impact on our competitive position and patient volumes, as patients may prefer to use lower-cost health care providers if they deliver services that are perceived to be similar in quality to ours. Competition from specialized providers, medical practices, retailers, digital health companies and other parties could negatively impact our revenue and market share.

We may encounter competitors that have greater name recognition, longer operating histories or more resources than us. Further, our current or potential competitors may be acquired by third parties with greater available resources. As a result, our competitors may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards or patient or clinician requirements and may have the ability to initiate or withstand substantial price competition. In light of these factors, even if our model is more effective than those of our competitors, current or potential patients or clinicians may choose to turn to our competitors. If we are unable to successfully compete in the healthcare market, our business and prospects would be materially harmed.

If reimbursement rates paid by third-party payors are reduced or if third-party payors otherwise restrain our ability to deliver services to our clients, our business could be harmed.

Private third-party payors pay for the services that we provide to many of our clients. If any commercial third-party payors reduce their reimbursement rates or elect not to cover some or all of our services, our business, results of operations and financial condition may be harmed. Third-party payors may also elect to create narrow networks, which may exclude our clinicians. Our payor relationships generally operate across multiple independent regional contracts. Changes in reimbursement rates from these or other large commercial payors could adversely impact our business and results of operations.

Our commercial payor contracts are typically structured as fee-for-service arrangements, pursuant to which we, or our affiliated practices, collect the fees for patient services. Under these arrangements, we assume financial risks related to changes in the mix of insured and uninsured patients and patients covered by government-sponsored health care programs, third-party reimbursement rates and patient volume.

A portion of our revenue comes from government health care programs. Payments from federal and state government programs are subject to statutory and regulatory changes, administrative rulings, interpretations and determinations, requirements for utilization review and federal and state funding restrictions, each of which could increase or decrease program payments, as well as affect the cost of providing services to patients and the timing of payments. We are unable to predict the effect of recent and future policy changes on our operations. In addition, the uncertainty and fiscal pressures placed upon federal and state governments as a result of, among other things, deterioration in general economic conditions and the funding requirements from federal healthcare reform legislation, may affect the availability of taxpayer funds for Medicare and Medicaid programs. Changes in government health care programs may reduce the reimbursement we receive from them or private payors and could adversely impact our business and results of operations.

A substantial decrease in patient volume, an increase in the number of uninsured or underinsured patients or an increase in the number of patients covered by government health care programs, as opposed to commercial plans that have higher reimbursement levels, could reduce our profitability and adversely impact future growth. In addition, we may be unable to enter new payor contracts on favorable terms, or at all. In some cases, our revenue decreases if our volume or reimbursement decreases, but our expenses, including clinician compensation, may not decrease proportionately.

There has also been a recent trend in the healthcare sector of payors shifting to new models and value-based care arrangements. Changing legislation and other regulatory and executive developments have led to the creation of new models of care and other initiatives in both the government and private sector. Value-based care incentivizes health care providers to improve both the health and well-being of their patients while concurrently managing the medical expenses or “spend” of a particular population. Value-based care reimbursement models implemented by government health care programs or private third-party payors could materially change the manner in which mental health providers are reimbursed. Any failure on our part to adequately implement strategic initiatives to adjust to these marketplace developments could have a material adverse impact on our business.

A nominal number of our current contracts provide for incremental payments tied to the attainment of quality or performance metrics. If we fail to obtain these metrics in future periods, our revenue may decrease relative to past periods. In addition, we may enter into contracts in the future that may include parallel or full risk sharing for identified populations. These agreements would expose us to significant financial downside in the event that we are not able to improve outcomes and reduce total cost of care for the populations. These contracts may include components of medical spending, increasing the size of potential downside risk relative to traditional fee-for-service mental health spending.

The federal government and several states have enacted laws restricting the amount out-of-network providers of services can charge and recover for such services.

In December 2020, in connection with the Consolidated Appropriations Act of 2021, the No Surprises Act introduced national limitations on physician billing for certain services furnished by providers who are not in-network with the patient’s self-insured health plan, individual or group health plan (including fully-insured plans) that will go into effect on January 1, 2022. In addition, several states where we conduct business have enacted or are considering similar laws that would apply to patients having state-regulated insurance. For example, Florida, Ohio and Texas have adopted their own balance billing laws that, in certain cases, prohibit out-of-network providers from billing patients in excess of in-network rates. These measures could limit the amount we can charge and recover for services we furnish where we or our clients have not contracted with the patient’s insurer and therefore could have a material adverse effect on our business, financial condition, results of operations, and cash flows. Moreover, these measures could affect our ability to contract with certain payors and under historically similar terms and may cause, and the prospect of these changes may cause, payors to terminate their contracts with us and our affiliated practices, further affecting our business, financial condition, results of operations and cash flows. There is also risk that additional legislation at the federal and state level will give rise to major third-party payors leveraging this legislation or related changes as an opportunity to terminate and renegotiate existing reimbursement rates.

Financial pressures on patients, as well as economic conditions, may adversely affect our patient volume.

We may be adversely affected by patients’ unwillingness to pay for treatment by our clinicians. Higher numbers of unemployed individuals generally translate into more individuals without health care insurance to help pay for services, thereby increasing the potential for persons to elect not to seek treatment if they cannot afford to self-pay. Growth of patient receivables or deterioration in the ability to collect on these accounts, due to changes in economic conditions or otherwise, could have an adverse effect on our business, results of operations and financial condition. In addition, patients with high deductible insurance plans may be less likely to seek treatment as a result of higher expected out-of-pocket costs.

We may receive reimbursement for virtual services that is less than for comparable in-person services, which would negatively impact revenue and results of operations.

From time to time, we may operate in states that have not adopted laws related to parity between reimbursement rates for virtual services and in-person care. If we are not able to enter into regional payor contracts that provide for reimbursement parity between in-person and virtual services, private payors may not reimburse for virtual services at the same rates as in-person care for all patients within that market. Currently, our reimbursement rates for virtual services and in-person care are substantially similar. This is driven by contractual arrangements with our payor partners or payor policies. If we are not able to enter into or renew payor contracts on these terms or if payor policies change, we may receive reimbursement for virtual services that is less than comparable to in-person services in such states, which would negatively impact our revenue with respect to such markets, and as a result, our business, financial condition and results of operations.

Failure to timely or accurately bill for our services could have a negative impact on our patient service revenue, bad debt expense and cash flow.

Billing for our services is complex. The practice of providing mental health services in advance of payment or prior to assessing a patient’s ability to pay for such services may have a significant negative impact on our patient service revenue, bad debt expense and cash flow. We bill numerous and varied payors, including self-pay patients and various forms of commercial insurance providers. Different payors typically have differing forms of billing requirements that must be met prior to receiving payment for services rendered. Self-pay patients and third-party payors may fail to pay for services even if they have been properly billed. Reimbursement to us is typically conditioned, among other things, on our providing the proper procedure and diagnosis codes. Incorrect or incomplete documentation and billing information could result in non-payment for services rendered or reduction in reimbursement. Additional factors that could complicate our billing include variation in coverage for similar services among various payors and the difficulty of adherence to specific compliance requirements, coding and various other procedures mandated by responsible parties. To the extent the complexity associated with billing for our services causes delays in our cash collections, we assume the financial risk of increased carrying costs associated with the aging of our accounts receivable as well as the increased potential for bad debt expense.

We face inspections, reviews, audits and investigations under our commercial payor contracts and pursuant to federal and state programs. These audits could have adverse findings that may negatively affect our business, including our results of operations, liquidity, financial condition and reputation.

We are subject to various inspections, reviews, audits and investigations to verify our compliance with applicable laws and regulations and any payor-specific requirements. Commercial payors and government programs reserve the right to conduct audits. We also periodically conduct internal audits and reviews of our regulatory compliance. An adverse inspection, review, audit or investigation could result in:

We have in the past and may in the future be required to refund amounts we have been paid and/or pay fines and penalties as a result of these inspections, reviews, audits and investigations. If adverse inspections, reviews, audits or investigations occur and any of the results noted above occur, it could have a material adverse effect on our business, financial condition and results of operations. Furthermore, the legal, document production and other costs associated with complying with these inspections, reviews, audits or investigations could be significant.

Our healthcare business depends on our ability to effectively implement our AI to maintain the uninterrupted operation and data integrity of our information technology and other business systems.

Our business is dependent on maintaining effective information systems as well as the integrity and timeliness of the data we use to serve our patients, support our clinicians and payor partners and operate our business. Because of the large amount of data that we collect and manage, it is possible that hardware failures or errors in our systems could result in data loss or corruption or cause the information that we collect to be incomplete or contain inaccuracies that our partners regard as significant. If our data were found to be inaccurate or unreliable due to fraud or other error, or if we, or any of the third-party vendors we engage, were to fail to maintain information systems and data integrity effectively, we could experience operational disruptions that may impact our patients and clinicians and hinder our ability to provide care to patients, retain and attract patients, establish reserves, report financial results timely and accurately and maintain regulatory compliance, among other things.

Our information technology strategy and execution are critical to our continued success. We must continue to invest in long-term solutions that will enable us to anticipate patient needs and expectations, enhance the patient experience, act as a differentiator in the market, protect against rapidly changing cybersecurity risks and threats, and keep pace with evolving privacy and security laws, requirements and regulations, including changes in payment regimes. Our success is dependent, in large part, on maintaining the effectiveness of existing technology systems and continuing to deliver and enhance technology systems that support our business processes in a cost-efficient and resource-efficient manner.

Increasing regulatory and legislative changes will place additional demands on our information technology infrastructure that could have a direct impact on resources available for other projects tied to our strategic initiatives for our technology platform. In addition, recent trends toward greater patient engagement in health care require new and enhanced technologies, including more sophisticated applications for mobile devices. Connectivity among technologies is becoming increasingly important. We must also develop new systems to meet current market standards and keep pace with continuing changes in information processing technology, evolving industry and regulatory standards and patient needs. Failure to do so may present compliance challenges and impede our ability to deliver care to patients in a competitive manner. Even if successful, there can be no assurance that additional development projects will not be needed or arise in the future or that we have the necessary resources to complete such development projects. Further, the technological advances of our competitors or future competitors may result in our technologies or future technologies become uncompetitive or obsolete. Our failure to effectively invest in, implement improvements to and properly maintain the uninterrupted operation and data integrity of our information technology and other business systems could adversely affect our results of operations, financial position, and cash flow.

Clinicians and affiliated practices may become subject to medical liability claims, which could cause us to incur significant expenses and may require us to pay significant damages if not covered by insurance.

Our business entails the risk of medical liability claims against us, our clinicians and our affiliated practices. Although we, our clinicians and our affiliated practices carry insurance covering medical malpractice claims in amounts that we believe are appropriate in light of the risks attendant to our business, successful medical liability claims could result in substantial damage awards that exceed the limits of our and our clinicians’ insurance coverage. Our affiliated practices and clinicians carry professional liability insurance, and we separately carry a professional liability insurance policy, which covers medical malpractice claims. In addition, professional liability insurance is expensive and insurance premiums may increase significantly in the future, particularly as we expand our services. As a result, adequate professional liability insurance may not be available to our clinicians, our affiliated practices or to us in the future at acceptable costs or at all.

Any claims made against us that are not fully covered by insurance could be costly to defend against, result in substantial damage awards against us and divert the attention of our management and our affiliated medical group from our operations, which could have a material adverse effect on our business, financial condition and results of operations. In addition, any claims may adversely affect our business or reputation.

If we fail to cost-effectively develop widespread brand awareness and maintain our reputation, or if we fail to achieve and maintain market acceptance for our health services, our business could suffer.

We believe that developing and maintaining widespread awareness of our brand and maintaining our reputation for delivering high-quality care to patients is important to attract new patients and clinicians and maintain existing patients and clinicians. In addition, we have a growing number of strategic relationships with primary care and other specialist physician partners to develop our integrated care model and referral networks. Market acceptance of our services and patient acquisition depends on educating people, as well as payors and partners, as to the distinct features, ease-of-use, positive lifestyle impact, efficacy, quality and other perceived benefits of our platform as compared to alternatives. In particular, market acceptance is dependent on our ability to sufficiently saturate a particular geographic area to deliver care to local patients. The level of saturation required depends on the needs of the local market and the preferences of the patients in that market. Further, we rely on referrals and placed advertisements to spread brand awareness. Referrals are dependent on patients relaying positive experiences with our services and clinicians. If we are not successful in demonstrating to existing and potential patients, clinicians and payors the benefits of our platform, if we are not able to sufficiently saturate a market in convenient locations for patients, or if we are not able to achieve the support of payors and physician partners for our model and services, we could experience lower than expected patient retention. Further, the loss or dissatisfaction of patients or clinicians may substantially harm our brand and reputation, inhibit widespread adoption of our services, reduce our revenue, and impair our ability to attract or retain patients and clinicians.

Our brand promotion activities may not generate awareness or increase revenue and, even if they do, any increase in revenue may not offset the expenses we incur in building our brand. If we fail to successfully promote and maintain our brand, we may fail to attract or retain patients, clinicians, payors and physician partners necessary to realize a sufficient return on our brand-building efforts or to achieve the widespread brand awareness we seek.

We conduct business in a heavily regulated industry and if we fail to comply with these laws and government regulations, we could incur penalties or be required to make significant changes to our operations or experience adverse publicity, which could have a material adverse effect on our business, results of operations and financial condition.

The U.S. healthcare industry is heavily regulated and closely scrutinized by federal and state governments. Comprehensive statutes and regulations govern the manner in which we provide and bill for services and collect reimbursement from governmental programs and private payors, our contractual relationships with affiliated clinicians, vendors and patients, our marketing activities and other aspects of our operations. Of particular importance are:

Because of the breadth of these laws and the need to fit certain activities within one of the statutory exceptions and safe harbors available, it is possible that some of our business activities could be subject to challenge under one or more of such laws. Achieving and sustaining compliance with these laws may prove costly. Failure to comply with these laws and other laws can result in civil and criminal penalties such as fines, damages, overpayment recoupment, loss of enrollment status and exclusion from the Medicare and Medicaid programs. The risk of our being found in violation of these laws and regulations is increased by the fact that many of them have not been fully interpreted by the regulatory authorities or the courts, and their provisions are sometimes open to a variety of interpretations. Our failure to accurately anticipate the application of these laws and regulations to our business or any other failure to comply with regulatory requirements could create liability for us and negatively affect our business. Any action against us for violation of these laws or regulations, even if we successfully defend against it, could cause us to incur significant legal expenses, divert our management’s attention from the operation of our business and result in adverse publicity.

To enforce compliance with the federal laws, the U.S. Department of Justice and the U.S. Department of Health and Human Services (“HHS”) Office of Inspector General (“OIG”) have continued their scrutiny of health care providers, which has led to a number of investigations, prosecutions, convictions and settlements in the healthcare industry. Dealing with investigations can be time- and resource-consuming and can divert management’s attention from the business. Any such investigation or settlement could increase our costs or otherwise have an adverse effect on our business. In addition, because of the potential for large monetary exposure under the federal False Claims Act, which provides for treble damages and mandatory minimum penalties per false claim or statement, health care providers often resolve allegations without admissions of liability for significant and material amounts to avoid the uncertainty of treble damages that may be awarded in litigation proceedings. Such settlements often contain additional compliance and reporting requirements as part of a consent decree, settlement agreement or corporate integrity agreement. Given the significant size of actual and potential settlements, it is expected that the government will continue to devote substantial resources to investigating health care providers’ compliance with the health care reimbursement rules and fraud and abuse laws.

We are, and may in the future be, a party to various lawsuits, demands, claims, qui tam suits, governmental investigations and audits (including investigations or other actions resulting from our obligation to self-report suspected violations of law) and other legal matters, any of which could result in, among other things, substantial financial penalties or awards against us, mandated refunds, substantial payments made by us, required changes to our business practices, exclusion from future participation in Medicare, Medicaid and other health care programs and possible criminal penalties, any of which could have a material adverse effect on our business, results of operations, financial condition and cash flows and materially harm our reputation.

The laws, regulations and standards governing the provision of health care services may change significantly in the future. We cannot assure you that any new or changed health care laws, regulations or standards will not materially adversely affect our business. We cannot assure you that a review of our business by judicial, law enforcement, regulatory or accreditation authorities will not result in a determination that could adversely affect our operations.

Regulations related to health care are constantly evolving. To the extent regulations are revised, particularly with respect to state licensure laws, our ability to provide virtual service across regions will be hampered.

In a regulatory climate that is uncertain, our operations may be subject to direct and indirect adoption, expansion or reinterpretation of various laws and regulations. Compliance with these future laws and regulations may require us to change our practices at an undeterminable and possibly significant initial monetary and recurring expense. These additional monetary expenditures may increase future overhead, which could have a material adverse effect on our results of operations and our ability to provide virtual services in certain jurisdictions. Areas of government regulation that, if changed, could be costly to us include: rules governing the practice of medicine by physicians; laws relating to licensure requirements for psychiatrists and other licensed mental health professionals; laws limiting the corporate practice of medicine and professional fee-splitting; laws governing the issuance of prescriptions in an online setting; cybersecurity and privacy laws; and laws and rules relating to the distinction between independent contractors and employees.

In addition, a few states have imposed different, and, in some cases, additional, standards regarding the provision of services virtually. The unpredictability of this regulatory landscape means that sudden changes in policy regarding standards of care and reimbursement are possible. If a successful legal challenge or an adverse change in the relevant laws were to occur, and we were unable to adapt our business model accordingly, our operations in the affected jurisdictions would be disrupted, which could have a material adverse effect on our business, financial condition and results of operations. If we are required to adapt our business model, we may be limited to only in-person services, which may have a material adverse effect on our business, financial condition and results of operations.

The impact of healthcare reform legislation and other changes in the healthcare industry and in health care spending on us is currently unknown, but may harm our business.

Our revenue is dependent on the healthcare industry and could be affected by changes in health care spending, reimbursement and policy. The healthcare industry is subject to changing political, regulatory and other influences. The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (the “Affordable Care Act” or the “ACA”) in 2010 made major changes in how health care is delivered and reimbursed, and increased access to health insurance benefits to the uninsured and underinsured population of the United States.

Since its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA as well as efforts to repeal or replace certain aspects of the ACA. Since the enactment of the Tax Cuts and Jobs Act of 2017, there have been additional amendments to certain provisions of the ACA, and it is possible that the then-current administration and Congress will likely continue to seek to modify or build on certain provisions of the ACA. We continue to evaluate the effect that the ACA and its possible modification or repeal and replacement has on our business. It is uncertain the extent to which any such changes may impact our business or financial condition. In addition to these legal challenges, the then-current administration may advance new healthcare policy goals and objectives through statute, regulation and executive order.

Other legislative changes to provider reimbursement have been proposed and adopted since the ACA was enacted. These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011 (known as Medicare sequestration) and subsequent extensions, which began in 2013 and will remain in effect through 2029 unless additional Congressional action is taken. In January 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. New laws may result in additional reductions in Medicare and other health care funding, which may materially adversely affect customer demand and affordability for our products and, accordingly, the results of our financial operations.

Such changes in the regulatory environment may also result in changes to our payor mix that may affect our operations and revenue. In addition, certain provisions of the ACA authorize voluntary demonstration projects, which include the development of bundling payments for acute, inpatient hospital services, physician services and post-acute services for episodes of hospital care. Further, the ACA may adversely affect payors by increasing medical costs generally, which could have an effect on the industry and potentially impact our business and revenue as payors seek to offset these increases by reducing costs in other areas. Certain of these provisions are still being implemented and the full impact of these changes on us cannot be determined at this time.

Uncertainty regarding future amendments to the ACA as well as new legislative proposals to reform health care and government insurance programs, along with the trend toward managed health care in the United States, could result in reduced demand and prices for our services. We expect that additional state and federal health care reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments and other third party payors will pay for health care products and services, which could adversely affect our business, financial condition and results of operations.

If our or our vendors’ security measures fail or are breached and unauthorized access to our employees’, patients’ or partners’ data is obtained, our systems may be perceived as insecure, we may incur significant liabilities, including through private litigation or regulatory action, our reputation may be harmed, and we could lose patients and partners.

Our business involves the storage and transmission of proprietary information and sensitive or confidential data, including personal information of employees and others, as well as the PHI of our patients. Several laws and regulations require us to keep this information secure. Because of the extreme sensitivity of the information we store and transmit, the security features of our and our third-party vendors’ computer, network and communications systems infrastructure are critical to the success of our business. We cannot be sure that our security features and processes or that our vetting and oversight of third parties will be sufficient. We also exercise limited control over third-party vendors, which increases our vulnerability to problems with the technology and information services they provide. Determined threat actors would likely be able to penetrate our security or the security of our vendors with enough skills, resources, and time. A breach or failure of our or our third-party vendors’ network, hosted service providers or vendor systems could result from a variety of circumstances and events, including third-party action, employee negligence or error, malfeasance, computer viruses, cyber-attacks by computer hackers such as denial-of-service and phishing attacks, nation-state attacks, political protests, failures during the process of upgrading or replacing software and databases, power outages, hardware failures, telecommunication failures, user errors or catastrophic events. Information security risks have generally increased in recent years because of the proliferation of new technologies and the increased sophistication and activities of perpetrators of cyber-attacks. We are also dependent on a technology supply chain that involves many third parties, some of whom may not be known to us, and each of these companies may also be a source of potential risk to our patients, operations and reputation. Hackers and data thieves are increasingly sophisticated and operating large-scale and complex automated attacks, including on companies within the healthcare industry. As cyber threats continue to evolve, we and our third-party vendors may be unable to anticipate all potential threats. We may be required to expend additional resources to further enhance our information security measures and/or to investigate and remediate any information security vulnerabilities. If our or our third-party vendors’ security measures fail or are breached, it could result in unauthorized persons accessing sensitive patient data (including PHI), a loss of or damage to our data, or an inability to access data sources, process data or provide our services to our patients. A security incident may even remain undetected for an extended period, and we or our third-party vendors may be unable to anticipate such threats and attacks or implement adequate preventive measures. Such failures or breaches of our or our third-party vendors’ security measures, or our or our third-party vendors’ inability to effectively resolve such failures or breaches in a timely manner, could severely damage our reputation, adversely affect patient, provider or investor confidence in us, and reduce the demand for our services from existing and potential patients. In addition, we could face litigation, damages for contract breach, monetary penalties or regulatory actions for violation of applicable laws or regulations and incur significant costs to comply with applicable data breach notification laws and to implement remedial measures to prevent future occurrences and mitigate past violations. Although we maintain insurance covering certain security and privacy damages and related expenses, we may not carry insurance or maintain coverage sufficient to compensate for all liability and in any event, insurance coverage would not address the reputational damage that could result from a security incident.

Our Board of Directors will be briefed periodically on cybersecurity and risk management issues, and we will implement a number of processes to avoid cyber threats and to protect privacy. However, the processes we have implemented in connection with such initiatives may be insufficient to prevent or detect improper access to confidential, proprietary or sensitive data, including personal data. In addition, the competition for talent in the data privacy and cybersecurity space is intense, and we may be unable to hire, develop or retain suitable talent capable of adequately detecting, mitigating or remediating these risks. Our failure to adhere to, or successfully implement processes in response to, evolving cybersecurity threats and changing legal or regulatory requirements in this area could result in legal liability or damage to our reputation in the marketplace.

Should an attacker gain access to our network or the network of our third-party vendor, including by way of example, using compromised credentials of an authorized user, we are at risk that the attacker might successfully leverage that access to compromise additional systems and data. Certain measures that could increase the security of our systems, such as data encryption (including data at rest encryption), heightened monitoring and logging, scanning for source code errors or deployment of multi-factor authentication, take significant time and resources to deploy broadly, and such measures may not be deployed in a timely manner or be effective against an attack. As cybersecurity threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities. The inability to implement, maintain and upgrade adequate safeguards could have a material adverse effect on our business.

Our information systems must be continually updated, patched and upgraded to protect against known vulnerabilities. The volume of new vulnerabilities has increased markedly, as has the criticality of patches and other remedial measures. In addition to remediating newly identified vulnerabilities, previously identified vulnerabilities must also be continuously addressed. Accordingly, we are at risk that cyber-attackers exploit these known vulnerabilities before they have been addressed. Due to the systems and platforms that we operate, the increased frequency at which vendors are issuing security patches to their products, the need to test patches and, in some cases, coordinate with clients and vendors, before they can be deployed, we continuously face the substantial risk that we cannot deploy patches in a timely manner. These risks can be heightened as we acquire and work to integrate additional centers. We are also dependent on third-party vendors to keep their systems patched and secure in order to protect our information systems and data. Any failure related to these activities and any breach of our information systems could result in significant liability and have a material adverse effect on our business, reputation and financial condition.

Our use and disclosure of PII, including PHI, is subject to federal and state privacy and security regulations, and our failure to comply with those regulations or to adequately secure such information we hold could result in significant liability or reputational harm and, in turn, substantial harm to our affiliated practices, affiliated clinicians, patient base and revenue.

The privacy and security of personally identifiable information, or PII, stored, maintained, received or transmitted electronically is a major issue in the United States. While we strive to comply with all applicable privacy and security laws and regulations, as well as our own posted privacy policies, legal standards for privacy, including but not limited to “unfairness” and “deception,” as enforced by the Federal Trade Commission and state attorneys general, continue to evolve and any failure or perceived failure to comply may result in proceedings or actions against us by government entities or others, or could cause us to lose customers, which could have a material adverse effect on our business. Recently, there has been an increase in public awareness of privacy issues in the wake of revelations about the activities of various government agencies and in the number of private privacy-related lawsuits filed against companies. Any allegations about us, our affiliated practices or our affiliated clinicians with regard to the collection, processing, use, disclosure, or security of PII or other privacy-related matters, even if unfounded and even if we are in compliance with applicable laws, could damage our reputation and harm our business.

We also publish statements to our patients and stakeholders that describe how we handle and protect personal information. If federal or state regulatory authorities or private litigants consider any portion of these statements to be untrue or misleading, we may be subject to claims of deceptive practices, which could lead to significant liabilities and consequences, including, without limitation, costs of responding to investigations, defending against litigation, settling claims and complying with regulatory or court orders.

Numerous foreign, federal and state laws and regulations govern collection, dissemination, use and confidentiality of personally identifiable health information, including state privacy and confidentiality laws (including state laws requiring disclosure of breaches) and HIPAA.

HIPAA establishes a set of basic national privacy and security standards for the protection of PHI, by health plans, health care clearinghouses and certain health care providers, referred to as covered entities, and the business associates with whom such covered entities contract for services, which includes us. Certain of our entities and affiliated practices are covered entities, while our management service entities are business associates.

HIPAA requires covered entities and business associates to develop and maintain policies and procedures with respect to PHI that is used or disclosed, including the adoption of administrative, physical and technical safeguards to protect such information. HIPAA also implemented the use of standard transaction code sets and standard identifiers that covered entities must use when submitting or receiving certain electronic health care transactions, including activities associated with the billing and collection of health care claims.

HIPAA imposes mandatory penalties for certain violations. Penalties for violations of HIPAA and its implementing regulations include civil monetary penalties per violation, subject to annual maximums. However, a single breach incident can result in violations of multiple standards, which could result in significant fines. A person who knowingly obtains or discloses individually identifiable health information in violation of HIPAA may face a criminal fine and up to one-year of imprisonment. The criminal penalties increase if the wrongful conduct involves false pretenses or the intent to sell, transfer, or use identifiable health information for commercial advantage, personal gain, or malicious harm. HIPAA also authorizes state attorneys general to file suit on behalf of their residents. While HIPAA does not create a private right of action allowing individuals to sue us in civil court for violations of HIPAA, its standards have been used as the basis for duty of care in state civil suits such as those for negligence or recklessness in the misuse or breach of PHI. Any such penalties or lawsuits could harm our business, financial condition, results of operations and prospects.

In addition, HIPAA mandates that the Secretary of Health and Human Services (“HHS”) conduct periodic compliance audits of HIPAA covered entities or business associates for compliance with the HIPAA Privacy and Security Standards. It also tasks HHS with establishing a methodology whereby harmed individuals who were the victims of breaches of unsecured PHI may receive a percentage of the Civil Monetary Penalty fine paid by the violator.

HIPAA further requires that patients be notified of any unauthorized acquisition, access, use or disclosure of their unsecured PHI that compromises the privacy or security of such information, with certain exceptions related to unintentional or inadvertent use or disclosure by employees or authorized individuals. HIPAA specifies that such notifications must be made “without unreasonable delay and in no case later than 60 calendar days after discovery of the breach.” If a breach affects 500 patients or more, it must be reported to HHS without unreasonable delay, and HHS will post the name of the breaching entity on its public website. Breaches affecting 500 patients or more in the same state or jurisdiction must also be reported to the local media. If a breach involves fewer than 500 people, the covered entity must record it in a log and notify HHS at least annually. We have experienced minor breaches of PHI in the ordinary course of business, but none have involved more than 500 individuals. Further, the HHS Office for Civil Rights (“OCR”) published a proposed rule in January of 2021, which, among other things calls for greater care coordination and an individual’s rights to access patient records. The proposed rule specifically encourages the disclosure of PHI when needed to help individuals experiencing substance use disorder, serious mental illness and in emergency circumstances. The proposed rule is subject to a regulatory suspension announced by the Biden administration and we do not know when (or if) the final rule will be published or whether there may be additional changes to the regulations, but when it is, we will need to evaluate and potentially update our HIPAA regulatory programs and documentation to comply with such requirements.

Additionally, we may be required to comply with the Federal Substance Abuse Confidentiality Regulations known as 42 C.F.R. Part 2. In July 2020, new regulations overhauled these laws to better align with HIPAA and make other updates to facilitate better coordination of care in response to the opioid epidemic. The federal government could initiate criminal charges for violations of Part 2, which include $500 for the first offense; and $5,000 for all subsequent offenses and seek fines up to $5,000 per violation for individuals and $10,000 per violation for organizations. Under the CARES Act, Congress also gave HHS the authority to issue civil money penalties for violations of Part 2, ranging from $100 to $50,000 per violation depending on the level of culpability.

Further, the U.S. federal government and various states and governmental agencies have adopted or are considering adopting various laws, regulations and standards regarding the collection, use, retention, security, disclosure, transfer and other processing of sensitive and personal information. For example, California implemented the California Confidentiality of Medical Information Act, that imposes restrictive requirements regulating the use and disclosure of health information and other personally identifiable information. These laws and regulations are not necessarily preempted by HIPAA, particularly if a state affords greater protection to individuals than HIPAA. Where state laws are more protective, we have to comply with the stricter provisions. In addition to fines and penalties imposed upon violators, some of these state laws also afford private rights of action to individuals who believe their personal information has been misused. There are many other state-based data privacy and security laws and regulations that may impact our business. All of these evolving compliance and operational requirements impose significant costs that are likely to increase over time, may require us to modify our data processing practices and policies, divert resources from other initiatives and projects and could restrict the way services involving data are offered, all of which may adversely affect our results of operations. Certain state laws may be more stringent or broader in scope, or offer greater individual rights, with respect to sensitive and personal information than federal, international or other state laws, and such laws may differ from each other, which may complicate compliance efforts. State laws are changing rapidly and there is discussion in Congress of a new federal data protection and privacy law to which we may be subject.

The interplay of federal and state laws may be subject to varying interpretations by courts and government agencies, creating complex compliance issues for us and our clients and potentially exposing us to additional expense, adverse publicity and liability. Further, as regulatory focus on privacy issues continues to increase and laws and regulations concerning the protection of personal information expand and become more complex, these potential risks to our business could intensify. Changes in laws or regulations associated with the enhanced protection of certain types of sensitive data, such as PHI or PII, along with increased customer demands for enhanced data security infrastructure, could greatly increase our cost of providing our services, decrease demand for our services, reduce our revenue and/or subject us to additional liabilities.

In addition to the applicable federal and state laws, we are also subject to PCI DSS, a self-regulatory standard that requires companies that process payment card data to implement certain data security measures. If we or our payment processor fail to comply with the PCI DSS, we may incur significant fines or liability and lose access to major payment card systems. Our systems are subject to annual review under the PCI DSS requirements, and we have historically had, may now have, and may have in the future have items that require improvement. Industry groups may in the future adopt additional self-regulatory standards by which we are legally or contractually bound.

Because of the breadth of these laws and the narrowness of their exceptions and safe harbors, it is possible that our business activities can be subject to challenge under one or more of such laws. The scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of health care reform. Federal, state and foreign enforcement bodies have recently increased their scrutiny of interactions between health care companies and health care providers, which has led to a number of investigations, prosecutions, convictions and settlements in the healthcare industry. Any such investigations, prosecutions, convictions or settlements could result in significant financial penalties, damage to our brand and reputation, and a loss of customers, any of which could have an adverse effect on our business.

Blockchain Industry and Technology risk which are applicable to the operations of Constellation Network

If we do not compete effectively in our target markets, our business, financial condition, and results of operations could be adversely affected.

The blockchain industry is highly innovative, rapidly evolving, and characterized by significant competition, experimentation, changing customer needs, frequent introductions of new products and services, and subject to uncertain and evolving industry and regulatory requirements. We compete against a number of companies operating both within the United States and abroad, and both those that focus on traditional financial services and those that focus on blockchain-based services.

Further, the recent change in administration has led to a more favorable federal regulatory environment for digital assets, which has encouraged more traditional technology companies to enter the digital asset industry. Such companies may have significantly greater financial, technical, marketing and other resources than we do, which may allow them to more efficiently identify and capitalize upon opportunities and trends, transition and adapt their products and services, and devote greater resources to marketing and advertising, all of which could adversely affect our ability to compete effectively.

Despite this regulatory shift, our competition to date includes companies, in particular those located outside the United States, who are not required to or do not comply with the same regulatory compliance standards as us or who are subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions. The business models of such competitors rely on or benefit from being unregulated or only regulated in a small number of lower compliance jurisdictions, whilst also offering their products in highly regulated jurisdictions, including the United States, without necessarily complying with the relevant regulatory requirements in such jurisdictions.

We also intend to expend significant managerial, operational, and compliance costs to meet the legal and regulatory requirements applicable to us in the United States and other jurisdictions in which we operate. Such costs are expected increased as we expanded our products and services that we offer. We expect to continue to incur significant costs to satisfy our legal and compliance obligations, which our unregulated or less regulated competitors have not had to and will not incur.

Many innovative start-up companies and larger companies have made, and continue to make, significant investments in research and development in blockchain technology, and we expect these companies to continue to develop similar or superior products and technologies that compete with us. Further, more traditional technology and data infrastructure businesses may choose to offer blockchain-based services in the future as the industry gains adoption. Our current and potential competitors may establish cooperative relationships among themselves or with third parties that may further enhance their resources.

Our existing competitors have, and our potential competitors are expected to have, various competitive advantages over us, such as:

If we are unable to compete successfully, or if competing successfully requires us to take costly actions in response to the actions of our competitors, our business, financial condition, and results of operations could be adversely affected.

Any negative publicity regarding digital asset industry may have an outsized negative effect on consumer confidence.

As is the case with other novel technology, compared to more established and well-known industries, any negative publicity regarding blockchain technology and digital assets companies could have an outsized negative effect on confidence in blockchain technology. For example, since the inception of blockchain technology, there have been incidents of smart contract developers acting maliciously and misappropriating funds, and numerous digital asset businesses and platforms have been sued, investigated, or shut down due to fraud, illegal activities, the sale or issuance of unregistered securities, manipulative practices, business failure, and cyberattacks or security breaches. In addition, the energy usage and environmental impact of certain blockchains have attracted considerable attention, which could potentially create a negative consumer sentiment and perception of digital assets.

Adverse economic conditions and geopolitical events may adversely affect our digital asset business.

Our performance is subject to general economic conditions and their impact on blockchain technology adoption, digital assets and our customers. The United States and other key international economies have experienced cyclical downturns from time to time in which economic activity declined resulting in lower consumption rates, restricted credit, reduced profitability, weaknesses in financial markets, bankruptcies, and overall uncertainty with respect to the economy. The impact of general economic conditions on the digital assets ecosystem is highly uncertain and dependent on a variety of factors, including market adoption of stablecoins and other digital assets, global trends in the blockchain economy, central bank monetary policies, and other events beyond our control. Geopolitical developments, such as the current conflict between Russia and Ukraine and related economic and other retaliatory measures taken by the United States, the European Union, and others, the ongoing Israel-Hamas conflict, trade wars, tariffs imposed by the new administration, and foreign exchange limitations can also increase the severity and levels of unpredictability globally and increase the volatility of global financial and digital asset markets. Our business, results of operations, financial condition, and prospects may be materially and adversely affected by any negative impact on the global economy and digital assets market resulting from the conflicts in Ukraine or the Middle East, new trade policies including tariffs, or any other geopolitical tension or general adverse economic condition.

Our business is subject to the risks of natural disasters, power outages, telecommunications failures, public health crises and similar events, and to interruptions by human-made problems such as war, terrorism, cyberattacks, government shutdowns and other actions, which may impact the demand for our products or services.

Events beyond our control may damage our ability to maintain our platform and provide services to our customers. Such events include, but are not limited to, hurricanes, earthquakes, fires, floods, and other natural disasters, pandemics, power outages, telecommunications failures, and similar events. Because we rely heavily on our servers, computer and communications systems, and the internet to conduct our business and provide high-quality service to our customers, disruptions could harm our ability to effectively run our business. Moreover, our customers, partners, and other service providers face similar risks, which could directly or indirectly impact our business, financial condition, and results of operations. This means that an outage of our platform could result in our system being unavailable for a significant period of time. Terrorism, cyberattacks, and other criminal, tortious, or unintentional actions could also give rise to significant disruptions to our operations. In addition, the long-term effects of climate change on the global economy and in particular our industry are unclear; however, we recognize that there are inherent climate-related risks wherever business is conducted. Examples include drought and water scarcity, warmer temperatures, wildfires, and air quality impacts and power shutoffs associated with wildfire prevention. In addition, acts of war and other armed conflicts, disruptions in global trade, travel restrictions, quarantines, terrorism, government shutdowns and other civil, political, and geopolitical unrest could cause disruptions in our business, including, but not limited to, our business with the federal government, and lead to interruptions, delays, or loss of critical data. All of the foregoing could adversely affect our business, financial condition, and results of operations.

The future development and growth of blockchain technology is subject to a variety of factors that are difficult to predict and evaluate. If the blockchain industry does not grow as we expect, our business, financial condition, and results of operations could be adversely affected.

The first implementation of blockchain technology occurred in 2008 and remains in the early stages of development. As such, the technology has not been widely adopted, particularly by incumbent technology companies, so demand for the technology remains limited. Though we believe that the anticipated benefits of blockchain technology will create such demand, there can be no assurance that this will occur, or if it does occur, that it will be in the near term.

The further growth and development of blockchain networks, and the protocols, applications and digital assets bult thereon, represent a new and evolving paradigm that is subject to a variety of factors that are difficult to evaluate, including:

Various other technical issues have also been uncovered from time to time that have or could have resulted in disabled functionalities, exposure of certain users’ personal information, theft of users’ assets, and other negative consequences, and which required resolution with the attention and efforts of their global miner, user, and development communities. If any such risks or other risks materialize, and in particular if they are not resolved, the development and growth of blockchain technology may be significantly affected and, as a result, our business, financial condition, and results of operations could be adversely affected.

The blockchain industry as a whole has been characterized by rapid changes and innovations and is constantly evolving. Although it has experienced significant growth in recent years, the slowing or stopping of the development, general acceptance and adoption and usage of blockchain technology and digital assets may adversely impact our business, financial condition, and results of operations.

Our products and services contain third-party open-source software components. Failure to comply with the terms of the underlying open-source software licenses could harm our business.

Our products and services contain software modules licensed to us by third-party authors under “open-source” licenses. We also make certain of our own software available to customers for free under various open-source licenses. Use and distribution of open-source software may entail greater risks than use of third-party commercial software, as open-source licensors generally do not provide support, warranties, indemnification, or other contractual protections regarding infringement claims or the quality of the code. In addition, the public availability of such software may make it easier for others to compromise our products and services.

Some open-source licenses contain requirements that we make available source code for modifications or derivative works we create based upon the type of open-source software we use or grant other licenses to our intellectual property. If we combine our proprietary software with open-source software in a certain manner, we could, under certain open-source licenses, be required to release the source code of our proprietary software to the public. This would allow our competitors to create similar offerings with lower development effort and time and ultimately could result in a loss of our competitive advantages. Alternatively, to avoid the public release of the affected portions of our source code, we could be required to expend substantial time and resources to reengineer some or all of our software.

Although we monitor our use of open-source software to avoid subjecting our products and services to conditions we do not intend, we have not recently conducted an extensive audit of our use of open-source software and, as a result, there can be no assurance that our processes for controlling our use of open-source software in our products and services are, or will be, effective. If we are held to have breached or failed to fully comply with all the terms and conditions of an open-source software license, we could face litigation, infringement, or other liability. We may also be required to seek costly licenses from third parties to continue providing our offerings on terms that are not economically feasible, to reengineer our products or services, to discontinue or delay the provision of our offerings if reengineering could not be accomplished on a timely basis, or to make generally available, in source code form, our proprietary code.

Moreover, the terms of many open-source licenses have not been interpreted by U.S. or foreign courts. As a result, there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to provide or distribute our products and services. From time to time, there have been claims challenging the ownership of open-source software against companies that incorporate open-source software into their solutions. As a result, we could be subject to lawsuits by parties claiming ownership of what we believe to be open-source software.

The status of a particular digital asset, including our own native digital asset, as a “security” in any relevant jurisdiction is subject to a high degree of uncertainty and if we are unable to properly characterize a digital asset or product offering, or if the regulatory framework with respect to digital assets changes, we may be subject to regulatory scrutiny, inquiries, investigations, fines, and other penalties, which may adversely affect our business, operating results, and financial condition.

The SEC and its staff, under previous administrations, have taken the position that a range of digital assets, products and services fall within the definition of a “security” under the U.S. federal securities laws. Despite the SEC being the principal federal securities law regulator in the United States, whether or not an asset, product or service is a security or the offering thereof constitutes a securities offering under federal securities laws currently depends on the application of various judicial precedents interpreting the definition of a “security” under the U.S. federal securities laws. The application of the relevant judicial precedents requires a highly complex, fact-driven analysis. Accordingly, whether any given digital asset, product or service may ultimately be deemed to be a security is uncertain and difficult to predict notwithstanding the conclusions of the SEC or any conclusions we may draw based on our risk-based assessment regarding the likelihood that a particular digital asset, product or service could be deemed a “security” or “securities offering” under applicable laws. Adding to the complexity, the SEC staff has indicated that the security status of a particular digital asset can change over time as the relevant facts evolve.

With limited exception, the SEC and its staff generally do not provide advance guidance of the status of any particular digital asset, product or service as a security or the offering or sale thereof as a securities offering. For example, the SEC’s Strategic Hub for Innovation and Financial Technology published a framework for analyzing whether any given digital asset is a security in April 2019. The SEC staff has also issued certain no-action letters and has brought various enforcement actions and entered into settlements with numerous digital asset economy participants alleging that certain digital assets or digital asset related products or services constituted a securities offering. However, these statements, framework and settled enforcement actions are not rules or regulations of the SEC, and are not binding on the SEC or courts. For instance, on April 5, 2025, then-acting SEC Chair Mark Uyeda announced that the SEC is conducting a review of the April 2019 digital asset security framework and other related guidance issued between 2019 and 2022 to determine whether to rescind or modify such guidance. There is therefore no certainty as to whether particular digital assets, products or services are securities or whether the offering of any such digital assets, products or services constitutes a securities offering or implicates a security offering, in each case under the U.S. federal securities laws. Moreover, the SEC and the Commodity Futures Trading Commission (the “CFTC”) and their senior officials have, at times, taken conflicting positions in public statements and enforcement actions as to whether a particular digital asset is a security. Furthermore, the views of the SEC and its staff in this area have evolved over time, and, at times, have appeared contradictory.

Additionally, the Securities Act does not preempt U.S. state law with respect to determining whether a digital asset, product or service is a security. Each state has the right to enforce its own securities laws and may ultimately determine that a digital asset, product or service is a security even if the SEC has elected not to pursue enforcement or it or its staff have given assurances that it would not do so, or a digital asset, product or service is otherwise excluded from the meaning of a security at the federal level.

If any of the digital assets we hold were considered a security, U.S. exchanges that list such digital assets will either have to register as a national securities exchange or de-list such digital assets. The delisting of these digital assets would have a significantly adverse impact on the liquidity of such digital assets, which would likely have a material adverse impact on our ability to generate revenue by selling digital assets we hold.

Litigation, regulatory actions, and compliance issues could subject us to significant fines, penalties, judgments, remediation costs, negative publicity, changes to our business model, and requirements resulting in increased expenses.

Our business is subject to increased risks of litigation and regulatory actions due to several factors and from various sources, including the highly regulated nature of the digital assets industry and the focus of state and federal enforcement agencies on this sector. The evolving regulatory landscape, with heightened scrutiny and enforcement, further exacerbates these risks.

From time to time, we have been and expect to be involved in, or the subject of, reviews, requests for information, investigations and proceedings (both formal and informal) by state and federal governmental agencies and other self-regulatory organizations, regarding our business activities and our qualifications to conduct our business in certain jurisdictions, which could subject us to significant fines, penalties, obligations to change our business practices and other requirements resulting in increased expenses and diminished earnings, in the event of negative findings arising from these reviews. Our involvement in any such matter also could cause significant harm to our reputation and divert management attention from the operation of our business, even if the matters are ultimately determined in our favor. Moreover, any settlement, or any consent order or adverse judgment in connection with any formal or informal proceeding or investigation by a government agency, may prompt litigation or additional investigations or proceedings as other litigants or other government agencies begin independent reviews of the same activities.

In addition, a number of participants in the digital assets industry have been the subject of: (i) putative class action lawsuits; (ii) state attorney general actions and other state regulatory actions; (iii) federal regulatory enforcement actions, including, among others, actions relating to alleged unfair, deceptive or abusive acts or practices; and (iv) violations of state licensing and money transmission

The regulatory environment, increased regulatory compliance efforts, and enhanced regulatory enforcement result in significant operational and compliance costs and may prevent us from providing certain products and services. There can be no assurance that these regulatory matters or other factors will not, in the future, affect how we conduct our business and, in turn, may have a material adverse effect on our business. In particular, legal proceedings brought under state consumer protection statutes, including, but not limited to, California’s Digital Financial Asset Law and Illinois’ Digital Assets and Consumer Protection Act, or under federal consumer financial services statutes may result in a separate fine for each violation of the statute, which, particularly in the case of class action lawsuits, could result in damages substantially in excess of the amounts we earned from the underlying activities. Even if certain regulatory requirements are reduced or eliminated, there can be no assurance that the uncertainty created by such changes will not affect how we conduct our business and, in turn, have a material adverse effect on our business.

In addition, from time to time, through our operational and compliance controls, we identify compliance and other issues that require us to make operational changes and, depending on the nature of the issue, may result in financial remediation to impacted customers. These self-identified issues and voluntary remediation payments could be significant, depending on the issue and the number of customers impacted, and could generate litigation or regulatory investigations that subject us to additional risk.

Our interactions with a blockchain may expose us to SDN or blocked persons and new legislation or regulation could adversely impact our business or the market for digital assets.

The Office of Financial Assets Control (“OFAC”) of the U.S. Department of Treasury requires us to comply with its sanction program and not conduct business with persons named on its specially designated nationals (“SDN”) list. However, because of the pseudonymous nature of blockchain transactions we may inadvertently and without our knowledge engage in transactions with persons named on OFAC’s SDN list. Our policy prohibits any transactions with such SDN individuals, and while we have internal procedures in place, we may not be adequately capable of determining the ultimate identity of the individual or entity with whom we transact with respect to selling cryptocurrency assets or providing access to our blockchain technology. We are unable to predict the nature or extent of new and proposed legislation and regulation affecting the blockchain industry, or the potential impact of the use of digital assets by SDN or other blocked or sanctioned persons, which could have material adverse effects on our business and our industry more broadly. Further, we may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties as a result of any regulatory enforcement actions, all of which could harm our business and reputation.

The characteristics of crypto assets have been, and may in the future continue to be, exploited to facilitate illegal activity such as fraud, money laundering, tax evasion and ransomware scams; if any of our customers do so or are alleged to have done so, it could adversely affect us.

Digital assets and the blockchain industry are relatively new and, in many cases, lightly regulated or largely unregulated. Some types of digital assets have characteristics, such as the speed with which digital assets transactions can be conducted, the ability to conduct transactions without the involvement of regulated intermediaries, the ability to engage in transactions across multiple jurisdictions, the irreversible nature of certain digital asset transactions and encryption technology that anonymizes these transactions, that make digital assets particularly susceptible to use in illegal activity such as fraud, money laundering, tax evasion and ransomware scams. Two prominent examples of blockchain-based software that accepted digital assets from illegal activities include Tornado Cash and Samurai Wallet, two decentralized “mixers” that facilitated the obfuscation of digital assets procured from illegal activities. The developers of these two mixers have been charged and convicted of federal crimes relating to the use of Tornado Cash and Samurai Wallet. Furthermore, U.S. regulators, including the SEC, CFTC, and Federal Trade Commission, as well as non-U.S. regulators, have taken legal action against persons alleged to be engaged in Ponzi schemes and other fraudulent schemes involving digital currencies. In addition, the FBI has noted the increasing use of digital currency in various ransomware and romance scams.

While we believe that our risk management and compliance framework, which includes thorough reviews we conduct as part of our due diligence process, is reasonably designed to detect any such illicit activities conducted by our potential or existing customers, we cannot ensure that we will be able to detect any such illegal activity in all instances. Because the speed, irreversibility and anonymity of certain digital asset transactions make them more difficult to track, fraudulent transactions may be more likely to occur. We or our potential banking counterparties may be specifically targeted by individuals seeking to conduct fraudulent transfers, and it may be difficult or impossible for us to detect and avoid such transactions in certain circumstances. If one of our customers (or in the case of digital asset exchanges, their customers) were to engage in or be accused of engaging in illegal activities using digital assets, we could be subject to various fines and sanctions, including limitations on our activities, which could also cause reputational damage and adversely affect our business, financial condition and results of operations.

A large portion of our operating cash flow is derived from the sale of digital assets.

The sale of digital assets that we hold constitutes a large portion of our operating cash flow. If the prices of the digital assets that we hold decreases, our ability to fund our operations could be materially impacted. Similarly, if liquidity in the digital assets that we hold decreases, or if we become unable to access that liquidity due to regulatory issues, the loss of exchange accounts or the absence of counterparties to transact with in private transactions, our ability to generate operating cash flows could be materially impacted.

A large portion of our assets are concentrated in a single digital asset, our native Constellation digital asset.

Our native Constellation digital asset comprises a large portion of our digital asset treasury and of our assets overall. As such, a decline in the price of our native digital asset could have a significant and adverse impact on our ability to generate revenue from the sale of our native digital asset, which in turn would have a material adverse effect on our business and financial condition. Similar, a decline in the liquidity for our native digital asset, or in our ability to access such liquidity, could have a significant and adverse impact on our ability to generate revenue from the sale of our native digital asset, which in turn would have a materially adverse effect on our business.

The prices of digital assets are extremely volatile, and price fluctuations may adversely impact the value of digital assets that we hold.

Digital assets have historically experienced high levels of volatility far in excess of that experienced in fiat currencies or publicly-traded equity securities. A number of factors contribute to changes in digital asset prices and volatility, including changes in the supply and demand for a particular digital asset, regulatory actions, market sentiment, macroeconomic factors, utility of a particular digital asset, and idiosyncratic events such as exchange outages or commentary on social media. We are exposed to price volatility with respect to the digital assets we own. A decline in price may require us to take an impairment charge on our digital assets, and a decline in the value of the digital assets we hold in higher concentrations, including our native Constellation digital asset, may have a larger adverse impact on our operating results in any given period. Volatility in the value of digital assets or other market factors may limit our ability to convert digital assets into fiat currency at attractive prices or at all.

The loss or destruction of private keys required to access any digital assets we hold may be irreversible.

Digital assets are generally controllable only by the possessor of the unique private key relating to the digital wallet in which the digital assets are held. While blockchain protocols typically require public addresses to be published when used in a transaction, private keys must be safeguarded and kept private in order to prevent a third party from accessing the digital assets held in such a wallet. To the extent that any of the private keys relating to wallets containing digital assets is lost, destroyed, or otherwise compromised or unavailable, and no backup of the private key is accessible, we will be unable to access the digital assets held in the related wallet. Further, we cannot provide assurance that our wallet will not be hacked or compromised. Digital assets, wallets and blockchain networks have been, and may in the future be, subject to cyberattacks or security breaches, hacking, or other malicious activities. Any loss of private keys relating to, or hack or other compromise of, digital wallets used to store our digital assets could adversely our ability to access or sell our digital assets and subject us to significant financial losses in addition to losing customer trust in us and our products.

Digital assets held by us are not subject to FDIC or SIPC protections and are not insured.

We do not hold our digital assets with a banking institution or a member of the Federal Deposit Insurance Corporation (“FDIC”) or the Securities Investor Protection Corporation (“SIPC”) and, therefore, our digital assets are not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. Further the digital assets held by us are not insured. Therefore, a loss may be suffered with respect to our digital assets which is not covered by insurance and for which no person is liable in damages, which could adversely affect our operations and financial condition.

The nature of our business requires the application of complex financial accounting rules, and there is limited guidance from accounting standard-setting bodies.

The accounting rules and regulations that we must comply with are complex and subject to interpretation by the Financial Accounting Standards Board (the “FASB”), the SEC, and various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported financial results and may even affect the reporting of transactions completed before the announcement or effectiveness of a change.

Further, there have been limited precedents for the financial accounting of digital assets and related valuation and revenue recognition considerations. As such, there remains significant uncertainty on how companies should account for stablecoin and other digital asset transactions, value, and related revenue. Additionally, on January 21, 2025, the SEC launched a crypto task force dedicated to developing a comprehensive and clear regulatory framework for digital assets, and on January 23, 2025 the SEC repealed Staff Accounting Bulletin 121 and issued Staff Accounting Bulletin 122 – further evidencing the shifting landscape for digital asset accounting. Uncertainties in or changes to regulatory or financial accounting standards could result in the need to change our accounting methods and/or restate our financial statements and impair our ability to provide timely and accurate financial information, which could adversely affect our financial statements, result in a loss of investor confidence, and more generally impact our business, results of operations, financial condition, and prospects.

Future developments regarding the treatment of digital assets for U.S. and foreign tax purposes could adversely impact our business, financial condition, and results of operations.

Due to the new and evolving nature of digital assets and the absence of comprehensive tax guidance with respect to digital asset products and transactions, many significant aspects of the U.S. and foreign tax treatment of transactions involving digital assets, such as the purchase and sale of digital assets, the wrapping or bridging of digital assets, and the provision of staking rewards and other digital asset incentives and rewards products, are uncertain, and it is unclear whether, when and what guidance may be issued in the future on the treatment of digital asset transactions for U.S. and foreign tax purposes.

In 2014, the U.S. Internal Revenue Service (the “IRS”) released Notice 2014-21, discussing certain aspects of “virtual currency” for U.S. federal income tax purposes and, in particular, stating that such virtual currency is “property,” is not “currency” for purposes of the rules relating to foreign currency gain or loss, and may be held as a capital asset. From time to time, the IRS has released other notices and rulings relating to the tax treatment of virtual currency or digital assets reflecting the IRS’s position on certain issues. The IRS has not addressed many other significant aspects of the U.S. federal income tax treatment of digital assets and related transactions.

There continues to be uncertainty with respect to the timing, character and amount of income inclusions for various digital asset transactions. Although we believe our treatment of digital asset transactions for federal income tax purposes is consistent with existing positions from the IRS and/or existing U.S. federal income tax principles, because of the rapidly evolving nature of digital asset innovations and the increasing variety and complexity of digital asset transactions and products, it is possible the IRS and various U.S. states may disagree with our treatment of certain digital asset transactions for U.S. tax purposes, which could adversely affect our customers and the vitality of our business. Similar uncertainties exist in the foreign markets in which we operate with respect to direct and indirect taxes, and these uncertainties and potential adverse interpretations of tax law could impact the amount of tax we and our non-U.S. customers are required to pay, and the vitality of our platforms outside of the United States.

There can be no assurance that the IRS, the U.S. state revenue agencies, local U.S. tax authorities or foreign tax authorities will not alter their respective positions with respect to digital assets in the future or that a court would uphold the treatment set forth in existing positions. It also is unclear what additional tax authority positions, regulations, or legislation may be issued in the future on the treatment of existing digital asset transactions and future digital asset innovations under U.S. federal, U.S. state or local, or foreign tax law. Any such developments could result in adverse tax consequences for holders of digital assets and could have an adverse effect on the value of digital assets and the broader blockchain industry. Future technological and operational developments that may arise with respect to digital assets may increase the uncertainty with respect to the treatment of digital assets for U.S. and foreign tax purposes. The uncertainty regarding tax treatment of digital asset transactions impacts our customers, and could impact our business, both domestically and abroad.

Risks Related to Our Intellectual Property which are applicable both to the consolidated operations of AIAI and the individual operations of AI Research

If we are unable to obtain, maintain and protect our intellectual property rights for application to our Portfolio Companies, or if our intellectual property rights are inadequate, our competitive position could be harmed.

Our commercial success will depend in part on our ability to obtain and maintain our intellectual property protection in the United States and other countries with respect to our technology, including the AI that we have licensed from M42. We may also rely in part on trade secret, copyright, and trademark laws, and confidentiality, licensing, and other agreements with employees and third parties, all of which offer only limited protection. We seek to protect our proprietary position by filing and prosecuting intellectual property applications in the United States and abroad related to our technology. The steps we take to protect our proprietary rights may not be adequate to preclude misappropriation of our proprietary information or infringement of our intellectual property rights, both inside and outside of the United States.

Further, the examination process may require us or M42, as applicable, to narrow the claims for any intellectual property applications, which may significantly limit the scope of the protection that may be obtained if these applications issue. Any such applications may not result in patents or copyrights being issued that protect the applicable intellectual property, in whole or in part, or which effectively prevent others from commercializing competitive products. The rights that may be granted under any issued patents or copyrights may not provide us with the proprietary protection or competitive advantages we are seeking. Even if our applications are issued, they may not be issued in a form that will provide us with any meaningful protection, prevent competitors from competing with us or otherwise provide us with any competitive advantage. If we are unable to obtain and maintain protection for our technology or if the scope of the protection obtained is not sufficient, our competitors could develop and commercialize technology similar or superior to ours in a non-infringing manner, and our ability to successfully commercialize our existing and future technologies may be adversely affected.

In addition, the intellectual property prosecution process is expensive, time-consuming and complex, and we may not be able to file, prosecute, maintain, enforce or license all necessary or desirable intellectual property applications at a reasonable cost or in a timely manner. Although we will enter into non-disclosure and confidentiality agreements with parties who have access to confidential or proprietary technology, such as our employees, employees of the Portfolio Companies, collaborators, and other third parties, any of these parties may breach the agreements and disclose such technology, thereby jeopardizing our ability to seek protection. It is also possible that we or M42 will fail to identify patentable aspects of our research and development efforts in time to obtain any patent protection.

Any pending applications cannot be enforced against third parties practicing the inventions claimed in such applications unless and until a patent or copyright has been issued relating to such applications with a claim that covers infringing third-party activity. Because the issuance of a patent or copyright is not conclusive as to its inventorship, scope, validity, or enforceability, issued patents may be challenged in the courts or patent offices in the United States and abroad, including through opposition proceedings, derivation proceedings, post-grant review, inter partes review, post-grant review, derivation proceedings, interference proceedings or litigation. Such proceedings may result in the loss of protection, the narrowing of claims in such patents or the invalidity or unenforceability of such patents, which could limit our or M42’s ability to stop others from using or commercializing similar or identical technology, or limit the duration of the protection for our technology. Protecting against the unauthorized use of our intellectual property rights is expensive, time-consuming, difficult and in some cases may not be possible. In some cases, it may be difficult or impossible to detect third-party infringement or misappropriation of our intellectual property rights, even in relation to issued patent or copyright claims, and proving any such infringement may be even more difficult. If we and M42 are unable to obtain, maintain, and protect the intellectual property our competitive advantage could be harmed, and it could result in a material adverse effect on our business, financial condition, results of operations, stock price and prospects.

If we fail to comply with our obligations in the agreements under which we license intellectual property rights from third parties, including the License Agreement, or otherwise experience disruptions to our business relationships with our licensors, we could lose intellectual property rights that are important to our business.

As of the date of this prospectus, we have entered into the License Agreement and may in the future need to obtain licenses from others to advance our acquisition activities. These license agreements are expected to impose customary use and development restrictions and other obligations on us. In spite of our efforts, our licensors might conclude that we have materially breached our obligations under such license agreements and might therefore terminate the license agreements, thereby removing or limiting our ability to develop and commercialize the technology covered by the intellectual property under any such license agreements. If the License Agreement, or any such other licenses, were to be terminated, or if the underlying intellectual property protections were to fail to provide the intended exclusivity, competitors or other third parties would have the freedom to seek regulatory approval of, and to market, technology identical to ours and we may be required to cease our commercialization of our technology. Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.

Moreover, disputes may arise regarding intellectual property subject to a licensing agreement, including:

In addition, the License Agreement and any other agreements under which we may license intellectual property or technology from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects. Moreover, if disputes over the intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully commercialize the technology, including the application of the licensed AI to our Portfolio Companies, which could have a material adverse effect on our business, financial conditions, results of operations, and prospects.

If we are unable to protect the confidentiality of our proprietary information and know-how, the value of our technology could be adversely affected.

In addition to seeking intellectual property protection, we also rely on other proprietary rights, including protection of trade secrets, know-how and confidential and other proprietary information. To maintain the confidentiality of trade secrets and proprietary information, we enter into confidentiality agreements with our employees, consultants, collaborators, contractors, and other third parties who have access to our technology. However, we may not obtain these agreements in all circumstances, and individuals with whom we have these agreements may not comply with their terms. In addition, we cannot be certain that our technology and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our technology or independently develop substantially equivalent information and techniques. In the event of unauthorized use or disclosure of our proprietary information, these agreements, even if obtained, may not provide meaningful protection, particularly for our trade secrets or other confidential information. To the extent that our employees, consultants, or contractors use technology or know-how owned by third parties in their work for us, disputes may arise between us and those third parties as to the rights in related inventions.

Adequate remedies may not exist in the event of unauthorized use or disclosure of our confidential information including a breach of our confidentiality agreements. Enforcing a claim that a party illegally disclosed or misappropriated confidential information is difficult, expensive, and time consuming, and the outcome is unpredictable. In addition, some courts in and outside of the United States are less willing or unwilling to protect certain types of confidential information. If any of our confidential information were to be lawfully obtained or independently developed by a competitor or other third party, we would have no right to prevent them from using that technology or information to compete with us. The disclosure of our trade secrets or the independent development of our trade secrets by a competitor or other third party would impair our competitive position and may materially harm our business, financial condition, results of operations, stock price and prospects.

Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights, the outcome of which would be uncertain and could harm our business.

Our commercial success depends on our ability to apply our AI to our Portfolio Companies without infringing, misappropriating or otherwise violating the intellectual property and proprietary rights of third parties. We may become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our current and any other future technology, including interference proceedings, post-grant review, inter partes review and derivation proceedings before the United States Patent and Trademark Office (or similar proceedings in foreign jurisdictions). Third parties may assert infringement or other intellectual property claims against us based on existing patents or patents that may be granted in the future. As the application of AI continues to expand and more patents are issued, the risk increases that we may be subject to claims of infringement of the patent rights of third parties. If we are found to infringe a third party’s intellectual property rights, and we are unsuccessful in demonstrating that such intellectual property rights are invalid or unenforceable, we could be required to obtain a license from such third party to continue applying our AI to our Portfolio Companies. However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us, and it could require us to make substantial licensing and royalty payments. In addition, in any such proceeding or litigation, we could be found liable for significant monetary damages, including treble damages and attorneys’ fees, if we are found to have willfully infringed a patent or other intellectual property right. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, stock price and prospects. Any claims by third parties that we have misappropriated their confidential information or trade secrets could have a similar material adverse effect on our business. Defense of these claims, regardless of their merit, would involve substantial litigation expense and would be a substantial diversion of employee resources from our business.

Parties making claims against us may be able to sustain the costs of complex intellectual property litigation more effectively than we can because they have substantially greater resources. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation or administrative proceedings, there is a risk that some of our confidential information could be compromised by disclosure. In addition, any uncertainties resulting from the initiation and continuation of any litigation could have material adverse effect on our ability to raise additional funds or otherwise have a material adverse effect on our business, results of operations, financial condition and prospects.

We may become involved in lawsuits to protect or enforce our intellectual property, which could be expensive, time-consuming and unsuccessful and have a material adverse effect on the success of our business.

Competitors may infringe our intellectual property or misappropriate or otherwise violate our intellectual property rights. Litigation may be necessary in the future to enforce or defend our intellectual property rights, to protect our trade secrets, or to determine the validity and scope of our own intellectual property rights or the proprietary rights of others. If we were to initiate legal proceedings against a third party to enforce our intellectual property rights, the defendant could counterclaim that any existing intellectual property protection is invalid and/or unenforceable. In intellectual property litigation in the United States, defendant counterclaims alleging invalidity and/or unenforceability are commonplace. The outcome following legal assertions of invalidity and unenforceability is unpredictable. Our licensed intellectual property, and any we own in the future, may become involved in priority or other intellectual property related disputes. Also, third parties may initiate legal proceedings against us to challenge the validity or scope of our owned or licensed intellectual property rights. These proceedings can be expensive and time consuming. Many of our current and potential competitors have the ability to dedicate substantially greater resources to conduct intellectual property related litigations or proceedings than we can. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. Accordingly, despite our efforts, we may not be able to prevent third parties from infringing upon or misappropriating our intellectual property. Litigation and other intellectual property related proceedings could result in substantial costs and diversion of management resources, which could harm our business and financial results. In addition, in an infringement proceeding, a court may decide that a patent licensed to us is invalid or unenforceable, or may refuse to stop the other party from using the technology at issue on the grounds that our patents do not cover the technology in question. An adverse result in any litigation or other intellectual property-related proceeding could put some or all of our intellectual property rights at risk of being invalidated, held unenforceable, or interpreted narrowly.

Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation in the United States, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. There could also be public announcements of the results of hearings, motions or other interim proceedings or developments in any such proceedings. If securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the price of shares of our common stock, and could have a material adverse effect on our ability to raise necessary funds. Any of the foregoing may have a material adverse effect our business, financial condition, results of operations, stock price and prospects.

If we fail to comply with our obligations in the License Agreement and any other intellectual property licenses and funding arrangements with third parties, we could lose rights that are important to our business.

It is possible that M42 may conclude that we have materially breached the License Agreement and might therefore terminate the agreement, thereby removing our ability to apply the AI to our Portfolio Companies. If the License Agreement is terminated, or if the underlying intellectual property protection fails to provide the intended market exclusivity, competitors would have the freedom to seek regulatory approval of, and to market, AI technology similar or identical to ours. Moreover, if the License Agreement is terminated, M42 may be able to prevent us from utilizing the technology covered by the agreement. If we breach the agreement and do not adequately cure such breach, the rights in the technology licensed to us under the License Agreement will revert to M42 at no cost to M42. This could have a material adverse effect on our competitive business position, our financial condition, our results of operations, and our business prospects.

The resolution of any contract interpretation disagreement that may arise under the License Agreement could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects. Moreover, if disputes over intellectual property that we have previously applied to our Portfolio Companies or impair our ability to maintain such application on commercially acceptable terms, we may be unable to continue to operate our Portfolio Companies in the manner in which they had been previously operated, which could have a material adverse effect on our business, financial conditions, results of operations, and prospects.

Risks Related to this Offering and Ownership of Our Common Stock

The direct listing process differs from an initial public offering underwritten on a firm-commitment basis.

This is not an underwritten initial public offering of common stock. This listing of our common stock on Nasdaq differs from an underwritten initial public offering in several significant ways, which include, but are not limited to, the following:

Such differences from a firm-commitment underwritten initial public offering could result in a volatile trading price for our common stock and uncertain trading volume, which may adversely affect your ability to sell any common stock that you may purchase.

Our common stock currently has no public market. An active trading market may not develop or continue to be liquid and the market price of shares of our common stock may be volatile.

We expect our common stock to be listed and traded on Nasdaq. Prior to the listing on Nasdaq, there has not been a public market for any of our securities, and an active market for our common stock may not develop or be sustained after the listing, which could depress the market price of shares of our common stock and could affect the ability of our stockholders to sell our common stock. In the absence of an active public trading market, investors may not be able to liquidate their investments in our common stock. An inactive market may also impair our ability to raise capital by selling shares of our common stock, our ability to motivate our employees through equity incentive awards, and our ability to acquire other companies by using shares of our common stock as consideration.

In addition, we cannot predict the prices at which our common stock may trade on Nasdaq following the listing of our common stock. The opening trading price of our common stock may be unrelated to historical sales prices of our common stock and the market price of our common stock may fluctuate significantly in response to various factors, some of which are beyond our control. In particular, as this listing is taking place through a novel process that is not a firm-commitment underwritten initial public offering, there will be no traditional book building process and no price at which traditional underwriters initially sold shares to the public to help inform efficient price discovery with respect to the opening trades on Nasdaq. On the day that the shares of our common stock are initially listed on Nasdaq, Nasdaq will begin accepting, but not executing, pre-opening buy and sell orders and will begin to continuously generate the indicative Current Reference Price on the basis of such accepted orders. The Current Reference Price is calculated each second and, during a 10-minute “Display Only” period, is disseminated, along with other indicative imbalance information, to market participants by Nasdaq on its NOII and BookViewer tools. Following the “Display Only” period, a “Pre-Launch” period begins, during which the Advisor, in its capacity as our financial advisor, must notify Nasdaq that our shares are “ready to trade.” Once the Advisor has notified Nasdaq that the shares of our common stock are ready to trade, Nasdaq will confirm the Current Reference Price for the shares of our common stock, in accordance with Nasdaq rules. If the Advisor then approves proceeding at the Current Reference Price, the applicable orders that have been entered will be executed at such price and regular trading of shares of our common stock on Nasdaq will commence, subject to Nasdaq conducting validation checks in accordance with Nasdaq rules. The Advisor will determine when the shares of our common stock are ready to trade and approve proceeding at the Current Reference Price primarily based on considerations of volume, timing and price. In particular, the Advisor will determine, based primarily on pre-opening buy and sell orders, when a reasonable amount of volume will cross on the opening trade such that sufficient price discovery has been made to open trading at the Current Reference Price. If the Advisor does not approve proceeding at the Current Reference Price (for example, due to the absence of adequate preopening buy and sell interest), the Advisor will request that Nasdaq delay the open until such a time that sufficient price discovery has been made to ensure a reasonable amount of volume crosses on the opening trade. For more information, see “Plan of Distribution.”

Additionally, prior to the opening trade, there will not be a price at which underwriters initially sold shares of common stock to the public as there would be in a firm-commitment underwritten initial public offering. The absence of a predetermined initial public offering price could impact the range of buy and sell orders collected by Nasdaq from various broker-dealers.

Consequently, upon listing on Nasdaq, the public price of our common stock may be more volatile than in a firm-commitment underwritten initial public offering and could decline significantly and rapidly.

Furthermore, because of our novel listing process on Nasdaq, Nasdaq’s rules for ensuring compliance with its initial listing standards, such as those requiring a valuation or other compelling evidence of value, are untested. In the absence of a prior active public trading market for our common stock, if the price of our common stock or our market capitalization falls below those required by Nasdaq’s eligibility standards, we may not be able to satisfy the ongoing listing criteria and may be required to delist.

In addition, because of our novel listing process, individual investors, retail or otherwise, may have greater influence in setting the opening public price and subsequent public prices of our common stock on Nasdaq and may participate more in our initial trading than is typical for a firm-commitment underwritten initial public offering. These factors could result in a public price of our common stock that is higher than other investors (such as institutional investors) are willing to pay, which could cause volatility in the trading price of our common stock and an unsustainable trading price if the price of our common stock significantly rises upon listing and institutional investors believe our common stock is worth less than retail investors, in which case the price of our common stock may decline over time. Further, if the public price of our common stock is above the level that investors determine is reasonable for our common stock, some investors may attempt to short our common stock after trading begins, which would create additional downward pressure on the public price of our common stock. To the extent that there is a lack of consumer awareness among retail investors, such a lack of consumer awareness could reduce the value of our common stock and cause volatility in the trading price of our common stock. In addition, demand for our common stock may be adversely affected by any actual or perceived damage to our public reputation or brand recognition.

The public price of our common stock following the listing also could be subject to wide fluctuations in response to the risk factors described in this prospectus and others beyond our control, including:

In addition, securities exchanges have experienced price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. Stock prices of many companies have fluctuated in a manner often unrelated to the operating performance of those companies. These fluctuations may be even more pronounced in the trading market for our common stock shortly following the listing of our common stock on Nasdaq as a result of the supply and demand forces described above. In the past, stockholders have instituted securities class action litigation following periods of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business and harm our business, results of operations and financial condition.

We are pursuing a novel method for going and being public, and as a result, the trading price and volume of our shares of Class A common stock may be more volatile than that of a company that completed a traditional initial public offering (IPO)

Very few companies have completed a direct listing to date. The novelty of the direct listing process, combined with the absence of underwriters to manage the initial distribution and stabilize the aftermarket, may contribute to increased volatility in our stock price. The stock price is purely dependent on market demand and supply, which may be less predictable than in an underwritten offering, or IPO. The market for our Shares could also be less liquid than companies using traditional methods. Investor perception of our brand may be influenced by increased volatility in and less predictability of our stock price as well as general market conditions. Adverse perception of our brand may affect our stock price in ways unrelated to our underlying business performance.

The Advisor, which will own 746,630 shares of our common stock on the date of the Direct Listing, may have a conflict of interest.

Given RBW Capital Partners’ dual role as our financial advisor under Nasdaq direct listing rules and its status as a stockholder may present a conflict of interest. A conflict of interest situation can arise when a person or an entity has interests that may make it difficult to perform its work objectively and effectively. Conflicts of interest may also arise if a person or entity receives personal benefits as a result of their position. Nasdaq will determine the Current Reference Price of our common stock in the Direct Listing in consultation with the Advisor in its capacity as our financial advisor. The Advisor will determine when the shares of our common stock are ready to trade and approve proceeding at the Current Reference Price primarily based on considerations of volume, timing, and price. In particular, the Advisor will determine, based primarily on pre-opening buy and sell orders, when a reasonable amount of volume will cross on the opening trade such that sufficient price discovery has been made to open trading at the Current Reference Price. We have agreed to issue the Advisor 746,630 Shares at the time of the Direct Listing. As the Advisor will receive substantial benefits as a result of the Direct Listing, the existence of such financial interests may result in a conflict of interest on the part of the Advisor between what it may believe is best for the Company and its stockholders and what it may believe is best for itself.

Limitations on investors’ ability to trace their shares to this registration statement may preclude claims under Sections 11 and 12 of the Securities Act, potentially reducing our liability exposure and limiting investors’ remedies.

In connection with this direct listing, we are registering up to 71,655,060 shares of our common stock, all of which may be sold into the public market, that were issued in prior transactions without registration in reliance on exemptions from registration under the Securities Act. There are an additional 1,000 unregistered shares, which together with any other unregistered shares of our Class A common stock, are “restricted securities” under Rule 144 of the Securities Act and are not being offered or sold as part of this offering.

The ability for purchasers of a security in the public market to bring a claim under Section 11 of the Securities Act requires that the security purchased be traceable to the allegedly defective registration statement. In Slack Technologies, LLC v. Pirani, 598 U.S. 759 (2023), the U.S. Supreme Court held that Section 11 applies only to shares that are actually issued pursuant to the registration statement. The U.S. Court of Appeals for the Ninth Circuit, in its 2025 opinion on remand, confirmed that the tracing requirement applies in the context of direct listings and that tracing shares to a registration statement is particularly difficult where registered and unregistered shares begin trading at the same time.

Unlike the circumstances in Slack Technologies v. Pirani (cited above), where registered and unregistered securities were available for purchase at the same time, the unregistered shares will not be simultaneously available for resale at the time of this offering. These restricted securities may only be resold in compliance with Rule 144 or another applicable exemption, which requires, among other conditions, a minimum six-month holding period for securities acquired from us or our affiliates. In addition, because we will become subject to the reporting requirements of the Exchange Act for the first time upon effectiveness of this offering, Rule 144(c)(1) requires that current public information about us be available for at least 90 days before any sales of restricted securities may be made under Rule 144. As a result, restricted securities held by existing shareholders will not be eligible for resale under Rule 144 until at least 90 days after we become a reporting company, and then only if all other Rule 144 requirements are satisfied.

However, once restricted securities become eligible for resale under Rule 144, it may become difficult for purchasers to trace whether shares they acquire in the secondary market were originally sold as part of this registered offering or were restricted securities later resold in compliance with Rule 144. If questions arise about the pedigree of shares, purchasers may face difficulties establishing that they acquired securities registered pursuant to this direct listing. Accordingly, if you purchase our common stock in the open market following this direct listing, you may not be able to assert claims under Section 11 or Section 12(a)(2) of the Securities Act for any material misstatements or omissions in this registration statement or related prospectus. This limitation may reduce the potential remedies available to investors, limit recovery in the event of a violation of the federal securities laws, and adversely affect the market price of our common stock. Moreover, because our potential liability under the Securities Act may be reduced as compared to a traditional IPO, investors may face greater risk in the event of inaccurate or incomplete disclosures.

Future sales of common stock by the Registered Stockholders and other existing stockholders could cause our share price to decline.

We currently expect our common stock to be listed and traded on Nasdaq. Prior to listing on Nasdaq, there has been no public market for our common stock and there has not been a sustained history of trading in our common stock in “over-the-counter” markets. While our common stock may be sold after our listing on Nasdaq by the Registered Stockholders pursuant to this prospectus or by our other existing stockholders in accordance with Rule 144 under the Securities Act, unlike a firm-commitment underwritten initial public offering, there can be no assurance that any Registered Stockholders or other existing stockholders will sell any of their shares of common stock and there may initially be a lack of supply of, or demand for, common stock on Nasdaq. As described herein, certain shares of our common stock outstanding as of the date hereof will be registered under this registration statement. There can be no assurance that the Registered Stockholders and other existing stockholders will not sell all of their shares of common stock, resulting in an oversupply of our common stock on Nasdaq. In the case of a lack of supply of our common stock, the trading price of our common stock may rise to an unsustainable level. Further, institutional investors may be discouraged from purchasing our common stock if they are unable to purchase a block of our common stock in the open market due to a potential unwillingness of our existing stockholders to sell a sufficient amount of common stock at the price offered by such institutional investors and the greater influence individual investors have in setting the trading price. If institutional investors are unable to purchase our common stock, the market for our common stock may be more volatile without the influence of long-term institutional investors holding significant amounts of our common stock. In the case of a lack of market demand for our common stock, the trading price of our common stock could decline significantly and rapidly after our listing. Therefore, an active, liquid and orderly trading market for our common stock may not initially develop or be sustained, which could significantly depress the public price of our common stock and/or result in significant volatility, which could affect your ability to sell your shares of common stock.

You may be diluted by future issuances of preferred stock or additional common stock in connection with our incentive plans, acquisitions or otherwise; future sales of such shares in the public market, or the expectations that such sales may occur, could lower our stock price.

We have adopted an amended and restated certificate of incorporation which authorizes us to issue shares of common stock and options, rights, warrants and appreciation rights relating to our common stock for the consideration and on the terms and conditions established by our Board of Directors in its sole discretion. We could issue a significant number of shares of common stock in the future in connection with investments or acquisitions. Any of these issuances could dilute our existing stockholders, and such dilution could be significant. Moreover, such dilution could have a material adverse effect on the market price for the shares of our common stock.

The future issuance of shares of preferred stock with voting rights may adversely affect the voting power of the holders of shares of our common stock, either by diluting the voting power of our common stock if the preferred stock votes together with the common stock as a single class, or by giving the holders of any such preferred stock the right to block an action on which they have a separate class vote, even if the action were approved by the holders of our shares of our common stock.

The future issuance of shares of preferred stock with dividend or conversion rights, liquidation preferences or other economic terms favorable to the holders of preferred stock could adversely affect the market price for our common stock by making an investment in the common stock less attractive.

Because we have no obligation to pay cash dividends on our common stock, you may not receive any return on investment unless you sell your common stock for a price greater than that which you paid for it.

We currently intend to retain a substantial portion of available funds and any future earnings to fund the future acquisitions and to provide capital for the growth of our business. Any determination to declare dividends will be made at the discretion of our Board of Directors and will depend on our financial condition, operating results, capital requirements, general business conditions and other factors that our Board of Directors may deem relevant. Our future ability to pay cash dividends on our common stock may also be limited by the terms of any future debt securities or credit facility. As a result, capital appreciation, if any, of the common stock you purchase in this offering will be your sole source of gain for the foreseeable future.

We are an emerging growth company, and the reduced disclosure requirements applicable to emerging growth companies may make our common stock less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of certain exemptions and relief from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including (i) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, (ii) having the option of delaying the adoption of certain new or revised financial accounting standards, (iii) reduced disclosure obligations regarding executive compensation in this prospectus and our periodic reports and proxy statements and (iv) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We may take advantage of these exemptions until such time that we are no longer an emerging growth company. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold stock. Further, pursuant to Section 107 of the JOBS Act, we have elected to take advantage of the extended transition period for complying with new or revised accounting standards until those standards would otherwise apply to private companies. As a result, our operating results and financial statements may not be comparable to the operating results and financial statements of other companies who have adopted the new or revised accounting standards.

We will remain an emerging growth company until the earliest of (i) December 31, 2030, (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the last day of the fiscal year in which we are deemed to be a “large accelerated tiler” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock held by non-affiliates was $700.0 million or more as of the last business day of the second fiscal quarter of such year or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

It is possible that some investors will fund our common stock less attractive as a result of the foregoing, which may result in a less active trading market for our common stock and higher volatility in our stock price.

John Rochon, the Chairman of our Board of Directors, will control us, and his interests may conflict with ours or yours.

Immediately following this offering, an investment entity controlled by John Rochon, the chairman of our Board of Directors, will beneficially own 100% of our Class B Common Stock, representing approximately 50.1% of the voting power held after this offering and will, therefore, control the vote of all matters submitted to a vote of our stockholders, which will enable him to control the election of the members of our Board of Directors and other corporate decisions. Accordingly, for such period of time, Mr. Rochon will have significant influence with respect to our management, business plans, and policies, including the appointment and removal of our officers, decisions on whether to raise future capital and amending our charter and bylaws, which govern the rights attached to our common stock. In particular, during this period, Mr. Rochon will be able to cause or prevent a change of control of us or a change in the composition of our Board of Directors and could preclude any unsolicited acquisition of us. The concentration of ownership could deprive you of an opportunity to receive a premium for your shares of common stock as part of a sale of us and ultimately might affect the market price of our common stock.

Mr. Rochon, through voting agreements, also controls the operations of M42, which will license the AI technology to us pursuant to the License Agreement. Mr. Rochon and his affiliates, including M42, engage in a broad spectrum of business activities. In the ordinary course of their business activities, Mr. Rochon and his affiliates may engage in activities where their interests conflict with our interests or those of our other stockholders. Our amended and restated certificate of incorporation to be effective in connection with the closing of this offering will provide that none of Mr. Rochon, any of his affiliates, or any director who is not employed by us or its affiliates will have any duty to refrain from engaging, directly or indirectly, in the same business activities or similar business activities or lines of business in which we operate. Mr. Rochon also may pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us. In addition, Mr. Rochon may have an interest in pursuing acquisitions, divestitures, and other transactions that, in his judgment, could enhance his investment, even though such transactions might involve risks to our stockholders.

Upon listing of our shares on Nasdaq, we will be a “controlled company” within the meaning of the rules of Nasdaq and, as a result, we will qualify for exemptions from certain corporate governance requirements. If we elect to utilize one or more of these exemptions, you will not have the same protections as those afforded to stockholders of companies that are subject to such governance requirements.

After completion of this offering, Mr. Rochon will continue to control a majority of the voting power of our outstanding common stock. As a result, we will be a “controlled company” within the meaning of the corporate governance standards of Nasdaq. Under these rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including:

Although we have no current intention to utilize one or more of these exemptions following this offering, if we ultimately determine to do so you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of Nasdaq.

Investors in this offering may never obtain a return on their investment.

The declaration, amount and payment of any future dividends on shares of our common stock will be at the sole discretion of our Board of Directors, which may take into account general and economic conditions, our financial condition and results of operations, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions, the implications of the payment of dividends by us to our stockholders or by our subsidiaries to us, and any other factors that our Board of Directors may deem relevant. In addition, our ability to pay dividends is, and may be, limited by covenants of any future outstanding indebtedness we or our subsidiaries incur. Therefore, any return on investment in our common stock is solely dependent upon the appreciation of the price of our common stock on the open market, which may not occur. See “Dividend Policy.”

If securities or industry analysts do not publish research or publish unfavorable or inaccurate research about our business, our common stock price and trading volume could decline.

The trading market for our shares will be influenced, in part, by the research and reports that industry or securities analysts publish about us or our business. We do not have any control over these analysts. Securities and industry analysts do not currently, and may never, publish research on our Company. If no securities or industry analysts commence coverage of our Company, the trading price of our shares would likely be negatively impacted. In the event securities or industry analysts initiated coverage, and one or more of these analysts cease coverage of our Company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our share price or trading volume to decline. Moreover, if one or more of the analysts who cover us downgrade our stock, or if our results of operations do not meet their expectations, our share price could decline.

Provisions of our amended and restated certificate of incorporation and bylaws may delay or prevent a take-over that may not be in the best interests of our stockholders.

In addition to the ownership by Mr. Rochon of a controlling percentage of our common stock, provisions of our amended and restated certificate of incorporation and bylaws may be deemed to have anti-takeover effects, which include, among others, authorizing the issuance of shares of preferred stock which will have such rights and preferences determined from time to time by our Board of Directors. Our Board of Directors may, without stockholder approval (except as may be required under Nasdaq rules), issue additional preferred shares with dividends, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of our common stock.

Our amended and restated certificate of incorporation provides for an exclusive forum in the Court of Chancery of the State of Delaware for certain disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, (i) the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, the federal district court for the District of Delaware) shall, to the fullest extent permitted by law, be the sole and exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (c) any action arising pursuant to any provision of the General Corporation Law of the State of Delaware, or the DGCL, our certificate of incorporation or our bylaws or (d) any action asserting a claim governed by the internal affairs doctrine and (ii) to the fullest extent permitted by law, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause or causes of action arising under the Securities Act, including all causes of action asserted against any defendant to such complaint. Pursuant to our planned amended and restated certificate of incorporation, any person or entity purchasing or otherwise acquiring or holding any interest in shares of our common stock will be deemed to have had notice of and consented to the forum selection clause in our planned amended and restated certificate of incorporation described in this paragraph.

The foregoing provision would not preclude stockholders that assert claims under the Exchange Act from bringing such claims in federal court, to the extent that the Exchange Act confers exclusive federal jurisdiction over such claims, subject to applicable law.

We believe our choice of forum provision may benefit us by providing increased consistency in the application of Delaware law by chancellors and judges particularly experienced in resolving corporate disputes, efficient administration of cases on a more expedited schedule relative to other forums and protection against the burdens of multi-forum litigation. However, our choice of forum provision may impose additional litigation costs on stockholders in pursuing claims and may limit a stockholder’s ability to bring a claim in a judicial forum that it believes to be favorable for disputes with us or any of our directors, officers or other employees, which may discourage lawsuits with respect to such claims. In addition, while the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the choice of forum provision, and there can be no assurance that such provision will be enforced by a court in those other jurisdictions. If a court were to find the choice of forum provision in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.

General Risk Factors

We will incur significantly increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives and corporate governance practices.

As a public company, we will incur significant legal, accounting, and other expenses that we would not be required to incur as a private company. We will be subject to the reporting requirements of the Exchange Act, which will require, among other things, that we file with the SEC annual, quarterly, and current reports with respect to our business and financial condition. In addition, the Sarbanes-Oxley Act, as well as rules subsequently adopted by the SEC and Nasdaq to implement provisions of the Sarbanes-Oxley Act, impose significant requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial controls and changes in corporate governance practices. Further, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act) was enacted. There are significant corporate governance and executive compensation related provisions in the Dodd-Frank Act that require the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access. Emerging growth companies are exempted from certain of these requirements, but we may be required to implement these requirements sooner than budgeted or planned and thereby incur unexpected expenses. Stockholder activism, the current political environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate.

We expect the rules and regulations applicable to public companies to substantially increase our legal and financial compliance costs and to make some activities more time-consuming and costly. If these requirements divert the attention of our management and personnel from other business concerns, they could have a material adverse effect on our business, financial condition, and results of operations. The increased costs will decrease our net income or increase our net loss and may require us to reduce costs in other areas of our business or increase the prices of our products or services. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain the same or similar coverage. We cannot predict or estimate the amount or timing of additional costs we may incur to respond to these requirements. The impact of these requirements could also make it more difficult for us to attract and retain qualified persons to serve on our Board of Directors, our board committees or as executive officers.

If we fail to maintain proper and effective internal controls over financial reporting our ability to produce accurate and timely financial statements could be impaired.

We are required to maintain internal controls over financial reporting. After this offering is completed, we must perform certain system and process design evaluation and testing of the effectiveness of our internal controls over financial reporting to allow management to report on the effectiveness of our internal controls over financial reporting in our Form 10-K filing for that year, as required by Section 404 of the Sarbanes-Oxley Act. This will require that we incur substantial additional professional fees and internal costs to expand our accounting and finance functions and that we expend significant management efforts. Prior to this offering, we have never been required to test our internal controls within a specified period and, as a result, we may experience difficulty in meeting these reporting requirements in a timely manner.

If we are not able to comply with certain requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, or if we are unable to maintain proper and effective internal controls over financial reporting, we may not be able to produce timely and accurate financial statements. If that were to happen, our investors could lose confidence in our reported financial information, the market price of our stock could decline and we could be subject to sanctions or investigations by the SEC, Nasdaq or other regulatory authorities.

These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. For example, our directors or executive officers could inadvertently fail to disclose a new relationship or arrangement causing us to fail to make a required related party transaction disclosure. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in all control systems, misstatements due to error or fraud may occur and not be detected.

Changes in tax laws or exposure to additional income tax liabilities could affect our future profitability.

Factors that could materially affect our future effective tax rates include but are not limited to:

Because we do not have any history of operating at our present scale and have significant expansion plans, our effective tax rate may fluctuate in the future. Future effective tax rates could be affected by operating losses in jurisdictions where no tax benefit can be recorded under GAAP, changes in the composition of earnings in countries with differing tax rates, changes in deferred tax assets and liabilities, or changes in tax laws.

We have identified material weaknesses in the internal control over financial reporting of one of our Portfolio Companies and may identify additional material weaknesses in the future. Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud If we fail to establish and maintain effective internal controls over financial reporting, our operating results and our ability to operate our business could be harmed.

Our company has not previously been required to document and test its internal controls over financial reporting, nor has management been required to certify the effectiveness of its internal controls, and our auditors have not been required to opine on the effectiveness of its internal control over financial reporting. Similarly, our company has not been subject to the SEC’s internal control reporting requirements. Upon the completion of this offering, we will become subject to the periodic reporting requirements of the Exchange Act. We must design our disclosure controls and procedures to reasonably assure that information we must disclose in reports we file or submit under the Exchange Act is accumulated and communicated to management, and recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. We believe that any disclosure controls and procedures or internal controls and procedures, no matter how well-conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

In connection with the audit of CCCI, for the years ended December 31, 2024 and 2023, CCCI and its independent public accountants identified material weaknesses in CCCI’s internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses that CCCI and its public accountants identified in CCCI’s financial statements occurred because CCCI was a private company that had not previously been audited and had maintained a complement of resources with various levels of accounting knowledge, experience, and expertise that were not commensurate with its prospective public reporting needs. These material weaknesses relate to the lack of formal control over design and implementation, including those over information technology general control, and the lack of a sufficient complement of personnel within the financial and accounting function with an appropriate degree of knowledge, experience, and training.

We are initiating various remediation efforts, but we cannot reasonably estimate the cost of such remediation plan at this time. We can give no assurance that such efforts will remediate these material weaknesses relating to internal control over financial reporting or that additional material weaknesses in CCCI’s internal control over financial reporting will not be identified in the future.

We may discover weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements. Our internal control over financial reporting will not prevent or detect all errors and all fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

Failure to build our finance infrastructure and improve our accounting systems and controls could impair our ability to comply with the financial reporting and internal controls requirements for publicly traded companies.

As a public company, we will operate in an increasingly demanding regulatory environment, which requires us to comply with the Sarbanes-Oxley Act, the regulations of the Nasdaq Global Market, the rules and regulations of the SEC, expanded disclosure requirements, accelerated reporting requirements and more complex accounting rules. Company responsibilities required by the Sarbanes-Oxley Act include establishing corporate oversight and adequate internal control over financial reporting and disclosure controls and procedures. Effective internal controls are necessary for us to produce reliable financial reports and are important to help prevent financial fraud. After this offering is completed, we must perform system and process evaluation and testing of our internal controls over financial reporting to allow management to report on the effectiveness of our internal controls over financial reporting in our Form 10-K filing for that year, as required by Section 404 of the Sarbanes-Oxley Act. Prior to this offering, we have never been required to test our internal controls within a specified period and, as a result, we may experience difficulty in meeting these reporting requirements in a timely manner.

We anticipate that the process of building our accounting and financial functions and infrastructure will require significant additional professional fees, internal costs and management efforts. For example, we expect that we will need to implement and expand our systems and processes to enhance and streamline the management of our financial, accounting, human resources and other functions.

However, such systems will likely require us to complete many processes and procedures for the effective use of the systems, which may result in substantial costs. Any disruptions or difficulties in implementing or using these systems could adversely affect our controls and harm our business. Moreover, such disruption or difficulties could result in unanticipated costs and diversion of management attention. In addition, we may discover additional weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements. Our internal control over financial reporting will not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

If we are not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, or if we are unable to implement proper and effective internal controls, we may not be able to produce timely and accurate financial statements. If we cannot provide reliable financial reports or prevent fraud, our business and results of operations could be harmed, investors could lose confidence in our reported financial information and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

Future changes in financial accounting standards or practices may cause adverse and unexpected revenue fluctuations and adversely affect our reported results of operations.

Future changes in financial accounting standards may cause adverse, unexpected revenue fluctuations and affect our reported financial position or results of operations. Financial accounting standards in the United States are constantly under review and new pronouncements and varying interpretations of pronouncements have occurred with frequency in the past and are expected to occur again in the future. As a result, we may be required to make changes in our accounting policies. Those changes could affect our financial condition and results of operations or the way in which such financial condition and results of operations are reported. We intend to invest resources to comply with evolving standards, and this investment may result in increased general and administrative expenses and a diversion of management time and attention from business activities to compliance activities.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that can involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this prospectus, including statements regarding our future results of operations and financial position, business strategy, prospective products, product approvals, research and development costs, future revenue, timing and likelihood of success, plans and objectives of management for future operations, future results of anticipated products and prospects, plans and objectives of management are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements contained in this prospectus include, but are not limited to, statements about:

We have based these forward-looking statements largely on our current expectations and projections about our business, the industry in which we operate and financial trends that we believe may affect our business, financial condition, results of operations and prospects, and these forward-looking statements are not guarantees of future performance or development. These forward-looking statements speak only as of the date of this prospectus and are subject to a number of risks, uncertainties and assumptions described in the section titled “Risk Factors” and elsewhere in this prospectus. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein until after we distribute this prospectus, whether as a result of any new information, future events or otherwise.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this prospectus, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and you are cautioned not to unduly rely upon these statements.

INDUSTRY, MARKET, AND OTHER DATA

Unless otherwise indicated, estimates and information contained in this prospectus concerning our industry and the market in which we operate, including our general expectations, market position, market opportunity, and market size, are based on industry publications and reports generated by third-party providers, other publicly available studies, and our internal sources and estimates. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. While we have compiled, extracted, and reproduced industry data from external sources, including third-party, industry, or general publications, we have not independently verified the accuracy or completeness of the data contained in such sources. Similarly, while we believe our management estimates to be reasonable, they have not been verified by any independent sources. Forecasts and other forward-looking information with respect to industry are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this prospectus. See the section titled “Cautionary Note Regarding Forward-Looking Statements.”

The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section titled “Risk Factors” and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us.

USE OF PROCEEDS

The Registered Stockholders may, or may not, elect to sell shares of our common stock covered by this prospectus. To the extent any Registered Stockholder chooses to sell shares of our common stock covered by this prospectus, we will not receive any proceeds from any such sales of our common stock. For more information, see “Principal and Registered Stockholders.”

DIVIDEND POLICY

We currently intend to pay quarterly cash dividends to the holders of our Class A common stock, commencing with the first full fiscal quarter following the first anniversary of date of this prospectus. While we currently intend to distribute 25% of our operating cash flow less working capital and capital expenditure requirements, which we refer to herein as “Free Cash Flow,” to the holders our Class A common stock on a quarterly basis, the determination as to the declaration and payment of dividends will be at the discretion of our Board of Directors. We will not pay any dividends on the shares of our Class B common stock. Any such determination will depend upon our business prospects, operating results, financial condition, capital requirements, general business conditions, and other factors that our Board of Directors may deem relevant. The funds available for distribution, if any, will be net of the funds that are required to fund the operating costs of our business, including, without limitation, costs incurred to identify and acquire additional Portfolio Companies and capital contributions made to our subsidiaries to fund working capital and capital expenditures.

BUSINESS

General

AIAI was formed for the purpose of creating an AI-powered ecosystem through acquiring, and scaling companies that have high potential for increased operating results through the integration of our AI into their operations. We are not simply an investment vehicle—we seek to improve the operating performance of our Portfolio Companies through application of our proprietary AI. The AI that we will apply to the companies that we acquire will be licensed to us by M42, a company controlled by our founder, John P. Rochon, immediately prior to the effective date, or the Effective Date, of the Registration Statement of which this prospectus forms a part. See “—License Agreement.” AIAI identifies, acquires, and, where appropriate, consolidates high potential, AI-adjacent companies through a thorough evaluation framework that looks beyond conventional metrics. Our unique assessment methodology is designed to identify hidden value that traditional approaches miss, creating opportunities for increased stockholder returns. We expect to generate value through technological integration, unlocking synergies between AI and operations that remain invisible to traditional approaches. By combining complementary capabilities, we create solutions that are greater than the sum of their parts.

The global technological landscape is experiencing a fundamental shift as the industry reaches the critical threshold where AI transforms from a promising technology to a transformative force. Through our access to the integrated proprietary M42 AI Technology, we expect to be able to capitalize on the convergence of advanced AI, mature computing infrastructure, and market readiness. AIAI’s strategic thesis rejects the siloed application of AI and instead focuses on building an integrated ecosystem where specialized capabilities amplify each other across multiple verticals such as construction, healthcare, defense, blockchain data infrastructure, digital assets, and government services.

Our operating strategy is based on the premise that we anticipate generating a higher usage rate for our AI technology through applying it directly to our Portfolio Companies, which we believe will create greater stockholder value. We expect to implement this process through the acquisition of companies with AI integration potential as opposed to the generally accepted industry practice of marketing, selling, and negotiating individual license agreements with multiple unrelated clients. By creating a captive client base through targeted entity acquisitions, consisting of those that we acquire immediately prior to the Effective Date and those we acquire thereafter, we expect to be able to implement our AI solutions in a shorter time period (which we anticipate to be four to six months following the identification of an acquisition candidate) as compared to significantly longer time required to establish a third party licensing arrangement, which in our experience can last as long as 24 months to complete integration process. Additionally, we believe this strategy will result in a reduced execution risk and lower pursuit costs than negotiating third-party technology licenses.

AIAI is not just participating in the evolution of the “Cognitive Revolution,” it is helping to shape it. By integrating diverse companies into a cohesive AI ecosystem, the company expects to unlock value traditional models cannot replicate. With a clear vision, robust portfolio, and actionable roadmap, AIAI believes it is poised to redefine industries and deliver significant value to its stockholders. Our AI brings together the branches of mathematics, science, and engineering in a loosely coupled software platform that we believe can be applied to reveal undiscerned patterns and intelligence almost anywhere.

What Sets Us Apart

We believe the following characteristics set us apart from our competitors:

Our Opportunity

We believe that the current stage of the evolution of the Cognitive Revolution marks an inflection point where AI transitions from a promising tool to a transformative force. This AI revolution represents a transformative opportunity in how businesses operate. The market in which we expect to compete includes, among others, the following elements:

SAP also reports that there remain issues with strategic adoption of AI. Most AI investment is reported to be piecemeal (44%), based on department-led prioritization (32%), or ad hoc (15%). Only 9% of businesses are investing based on strategic, holistic prioritization. We believe this fragmented adoption of AI further supports our strategy of acquiring entire companies and applying our AI on an enterprise-wide basis.

The AI landscape is hypercompetitive, with rapid innovation cycles and high capital barriers. Traditional approaches, such as siloed R&D and linear roadmaps, are expected to struggle against AIAI’s ecosystem strategy, which focuses on value optimization through integration rather than direct development. We anticipate this positioning will create measurable advantages for AIAI, including rapid market responsiveness, multidimensional value creation, and reduced risk through strategic synergy.

Growth Strategy

General

Our growth strategy consists of multiple dimensions, beginning with our acquisition strategy. We will actively identify and acquire companies demonstrating strong potential for AI-driven enhancement, focusing on organizations with strong underlying business fundamentals and clear opportunities for value creation through AI implementation. Our target investment is one that fits within our “CURA” parameters, consisting of companies that solve complex, urgent, and/or administrative problems. Our portfolio is and will be a deliberately curated ecosystem, not a random collection of assets. Our strategy targets companies with proprietary technologies and cross-vertical potential, which are analyzed using the following criteria:

Our market expansion efforts will extend beyond our current operational footprint through carefully planned geographic expansion and sector development initiatives. We will enter into new markets through a combination of operations and strategic partnerships, always maintaining our commitment to rapid implementation and value creation. In each new market, we will establish comprehensive regulatory compliance frameworks and adapt our implementation methodologies to address local requirements and cultural considerations. We expect that this approach will enable us to maintain our accelerated implementation timeline even as we expand into new regions and sectors.

Targeted Industry Segments

We expect to concentrate on industry sectors that we believe have high potential for both financial returns and societal impact. Our initial focus will be on the following industries:

Set forth below are descriptions of the reasons why we our focusing our acquisition activities are certain targeted industries segments or verticals and how we believe our AI can assist operating performance.

Healthcare

The healthcare industry is not only essential for individual well-being—it is also a major driver of the global economy. Healthcare represents a significant portion of GDP, supporting millions of jobs and determining government policy.

The constant demand for more efficient and dynamic technology to manage persistent growth fuels investment and job creation, making healthcare one of the most resilient sectors even during economic downturns. However, the financial side of the industry isn’t without its challenges. High costs and significant fraud, waste, and abuse drain healthcare professionals, providers, and patients.

At the intersection of economics and care delivery lies the debate over efficiency, access, and sustainability. Behavioral AI improves healthcare delivery, streamlines patient interactions, and enhances predictive analytics. Whether that is helping healthcare professionals to improve care or assisting insurance partners to eliminate fraud, waste, and abuse, we believe behavioral AI helps provide better care for less.

There is an increasing urgency to transform the healthcare sector, to streamline its processes, to severely curb the drain of fraud, waste, and abuse and to engage the insightfulness of AI to advance one of the most critical, yet bloated, sectors to a much higher level of technical insight and responsiveness. Healthcare fraud, waste and abuse is well documented in the United States. Our AI can assist in identifying patterns of these activities and can help to reduce the underlying crimes while saving money and allowing for a contingent recovery of fraudulent payments.

Manufacturing

The manufacturing industry is a major driver of economic development, serving as both a major employer and a powerful engine for national growth. It encompasses everything from heavy industries like steel and automotive production to high-tech sectors such as electronics and precision equipment. Manufacturing doesn’t just produce goods, it acts as the backbone of the economic system that delivers those goods.

Economically, manufacturing plays a key role in exports, GDP, and job creation. It provides a wide range of employment opportunities, from skilled labor and machine operators to engineers and logistics professionals. As countries compete in global markets, advanced manufacturing techniques like AI have become central to staying efficient and cost-effective.

Helping to improve worker safety, eliminating extraneous waste from human blindspots, and reducing overall overhead by taking on heavy cognitive loads through automation, behavioral AI is a force multiplier for the manufacturing industry, another industrial revolution. Through leveraging the power of AI, manufacturing can stay more stable and cost-efficient, providing a competitive edge in a shifting global landscape.

Financial Services

The financial services sector is crucial in the global economy. Companies across all industries require access to capital to drive growth, implement cost-saving initiatives, and invest in innovative practices. In addition, companies turn to advisors to give expertise guidance in an extremely complex economic landscape. In this process, companies can find themselves foundering when critical decisions made by advisors are designed to primarily benefit themselves, rather than the companies.

Utilizing deep experience and specialized teams of advisors, along with a focus on profound solutions across a broad field of industries, we expect to provide direction and investment to not only help companies scale and improve revenues, but to undergo transformative change through access to sophisticate technologies and seasoned leadership. From treasury management functions to holdings of crypto currency, we expect to provide ground-up advisory services to financial services entities acquired in the future.

In a landscape that is increasingly uncertain and ruthless, establishing trusted advisory partnerships is more important than ever. What we expect to deliver is more than just capital—we anticipate providing deep insight and clarity to empower companies to not only navigate short-term complexity but to emerge transformed, stronger, smarter, and better equipped for sustained growth.

Energy and Natural Resources

As global energy demand continues to rise, the need for reliable energy solutions has never been more critical. It is absolutely crucial to national policies as well as economic stability. The energy sector is largely responsible for the continued operation and expansion of substantially all other industry segments.

We anticipate concentrating on the acquisition of midstream energy companies. These companies operate in the intermediate phase of the oil and gas industry, providing transportation, storage, and wholesale marketing of crude oil and natural gas. These companies play a crucial role in ensuring the continuous flow of energy resources from upstream producers to downstream end users and are crucial to the energy supply chain, linking raw resource extraction with refined product distribution.

Facing challenges such as price instability, government regulation, reliance on infrastructure, and a constantly growing demand, companies are under pressure to constantly innovate and sharpen their practices to find a competitive edge, not only domestically, but globally. This economic environment is ripe for transformation through the strategic use of behavioral AI that can help mitigate risk, optimize operations, and provide stability. By observing how operators interact with complex systems, it helps spot inefficiencies, reduce the chance of costly errors, and improve safety.

The energy sector plays a bedrock role in the global economy. It supports millions of jobs, drives investment, and influences all other operations. Through radical technology and innovative leadership, we aim to revolutionize the energy sector to provide greater stability and profitability.

Defense Contracting

The defense industry remains one of the most strategically important and economically significant sectors in the world. As a cornerstone of national security and technological progress, it consistently receives strong government backing, making it one of the most resistant sectors to economic downturns.

Behavioral AI revolutionizes how defense institutions make decisions, manage operations, and assess threats. By analyzing human interaction patterns and unlocking deep insights, behavioral AI reveals a hidden frontier in the defense field.

As global threats shift into asymmetric and digital dangers, the need for advanced solutions rises.

By aligning capital with visionary leadership and breakthrough technologies, we can help shape the future of global security.

Portfolio Development

We employ a systematic approach to portfolio development and optimization, through the application of the following guidelines:

Selection and Integration

Our evaluation of potential acquisitions is implemented through the application of a comprehensive due diligence plan, consisting of the following elements. The goal of our due diligence review is to assess the efficacy of the application of our AI to the operations of the target so that we acquire only those companies whose operations can be significantly enhanced through our AI and that fit into our overall operational ecosystem.

Understanding the Target’s Operational Foundation and Product Strategy

We begin our analysis by reviewing the target’ mission statement, product offerings, and services to understand the company’s operational and product focus. We then examine the target markets to gauge operational demands and product applicability. We also interview key management of the target to explore team organization, workflow management, operational priorities and product strategies. Finally, we assess current products and services for readiness to scale.

Evaluating Technical Capabilities and Infrastructure

We then assess the technical systems and infrastructure supporting the target’s AI functionality, product delivery, and scalability potential. During this process, we examine any AI technologies currently used for reliability and accuracy to assess any impediments to the application of our AI to the target’s existing operations. We also investigate the target’s data collection and management processes to evaluate consistent functionality and product performance. Finally, we assess the target’s overall expertise in AI, including certain tools required for the application of our AI to the target’s operations. This allows us to determine what additional personnel will be needed in order for the target to realize the full effect of our AI.

Reviewing Operational Execution, Team Capabilities, and Product Delivery

We then evaluate how the target executes its operations and the management team’s ability to maintain AI functionality and their capacity to deliver and productize services. During this process, we assess the management team’s operational and product development expertise. We also review resource management to evaluate efficiency in supporting product operations. Additionally, we examine the customer support process for functional reliability and service delivery and conduct a security audit to confirm product integrity.

Assessing Operational Resilience, Risks, and Product Stability

Our next step is to determine the resilience of operations, any risks to AI functionality, product stability by evaluating, among other things, technical risk impacting product reliability, dependency on a single or limited number of resources or suppliers, and prior product or service performance.

Planning for Operational Integration and Product Enhancement

Our due diligence process also includes an evaluation of the steps that will need to be taken, post-acquisition, to ensure the smooth integration of our AI into the target’s existing and contemplated operations with the goal of enhancing functionality and productization. This process includes, among other things, evaluating the feasibility of integrating our AI into the target’s existing information technology systems, identifying key personnel to be retained, aligning customer support and workflows to enhance product or service delivery, and data and database integration.

Recent Acquisitions

Immediately prior to the Effective Date, AIAI will acquire all of the issued and outstanding equity interests of the companies listed below. The consideration payable for these entities will be the number of shares of our common stock set forth in the table below issued at the initial price of $20.00 per share. Each of the acquisition agreements provides for the issuance of additional shares of our common stock in the event the initial offering price of our common stock in the Direct Listed is less than $20.00. Pursuant to the terms of the acquisition agreements for each of these companies, the companies will continue to be operated by their existing management teams. In certain circumstances, AIAI has agreed to provide additional capital required for working capital and capital expenditure purposes pursuant to annual budgets agreed to by the management teams of AIAI and each of the acquired companies.

Our Assets

Our Portfolio Companies

The following companies will be acquired by AIAI immediately prior to the Effective Date. The company’s initial portfolio will exemplify its ecosystem acquisition strategy.

Investment in M42

Immediately prior to the effective date of the Registration Statement of which this prospectus forms a part, AIAI will also own approximately 65,200 shares of Series A preferred stock issued by Messier Blocker Corporation (“Blocker Corp.”), an entity that owns approximately 6.3% of the issued and outstanding equity of M42. The Blocker Corp. preferred stock pays an annual dividend of 3% and has a liquidation preference of $5,000 per share. The Blocker Corp. preferred stock ranks senior to the common stock of Blocker Corp. and all other classes or series of capital stock issued by Blocker Corp. unless the terms of such stock expressly provide that it ranks senior to or on parity with the preferred stock. The holders of the Blocker Corp. preferred stock do not have any right to convert the preferred stock into any other equity issued by either Blocker Corp. or M42, and preferred stock is not redeemable at either the option of the holders or Blocker Corp.

Major Subsidiaries

C.C. Carlton Industries, Ltd.

General

Founded in 1993, C.C. Carlton Industries, Ltd. (CCCI) is a well-established civil construction company based in Texas, specializing in delivering full-scope civil construction, project management, and estimating services. With over 30 years of experience serving Texas, CCCI focused on civil construction services and established a strong reputation for excellence in the construction industry. Our services include clearing, site preparation, excavation, wet utility installation, dry utility installation, lift and pump stations, water treatment plants, concrete structures, streets and parking lots. Additionally, our landscaping division offers irrigation, revegetation, aquatic plantings, and custom wall construction. Backed by our deep industry expertise and proven estimating processes, CCCI has designed and managed a diverse range of projects, such as single-family subdivisions, multi-family subdivisions, apartments, commercial sites, hospitals, medical office buildings, industrial sites, schools, and municipal projects.

CCCI is dedicated to fostering long-term relationships with our clients, driven by our commitment to transparency, ethical practices, and adherence to the highest standards of quality. Our team of experienced professionals works collaboratively to deliver innovative solutions tailored to meet the unique needs of each project, ensuring customer satisfaction and project success. As CCCI continues to grow and adapt to the evolving construction landscape, remains committed to enhancing our capabilities and expanding our service offerings, positioning ourselves as a leader in the civil construction sector in Central Texas.

CCCI expects the strong demand for our services will continue, driven by (i) population growth in Texas resulting in public and private development, (ii) state and local government funding, and (iii) the need to repair and upgrade infrastructures. CCCI is prequalified to perform Texas Department of Transportation work, which gives us enhanced credibility and competitive advantage in a region where public infrastructure is expanding rapidly. As of September 30, 2025 and December 31, 2024, our remaining performance obligation backlog was $125.7 million and $131.9 million, respectively.

Operations

CCCI primarily derives revenue from fixed-price contracts in the civil construction sector with a focus on construction of site utilities, roads, bridges, and concrete structures in Texas. CCCI specializes in providing full-scope civil construction, project management, and estimating services, including but not limited to wet and dry utility installation, paving and concrete structures, site clearing and grading, lift and pump stations, and treatment plants. Additionally, our landscaping division offers irrigation, revegetation, aquatic plantings, and custom wall construction. This diverse expertise is essential for executing a variety of projects, including single-family subdivisions, multi-family subdivisions, commercial sites, hospitals, medical office buildings, industrial sites, schools, and municipal projects with efficiency and scalability.

CCCI recognizes revenue over time as work is completed, typically using an input measure such as costs incurred to date relative to total estimated costs at completion to measure progress. Costs that do not depict progress toward satisfaction of the performance obligation are included in contract costs but may not result in revenue being recognized, such as significant re-work.

Trends and Key Factors Affecting Performance

CCCI believes its future performance will be influenced by a number of factors, including those described in the section titled “Risk Factors” and elsewhere in this prospectus as well as the factors described below. While each of these factors presents significant opportunities for us, these factors also pose challenges that CCCI must successfully address in order to sustain the growth of our business and enhance our results of operations.

Weather, Natural Disasters, and Emergencies

The performance of our operation in a given period can be impacted by adverse weather conditions, severe weather events, natural disasters or other emergencies, which include, among other things, heavy or prolonged snowfall, icing, or rainfall, hurricanes, tropical storms, tornadoes, floods, extreme temperatures, wildfires, and pandemics. These conditions and events can negatively impact our financial results due to, among other things, the termination, deferral or delay of projects, reduced productivity and exposure to significant liabilities. See “Risk Factors—Risks Related to Industry Verticals—Construction.”

Seasonality

Our operations are typically affected more by weather conditions during the first and fourth quarters of our fiscal year, because cold, snowy or wet conditions can create challenging working environments that are more costly for our customers or cause delays on projects. This may alter our construction schedules and can create variability in our revenues, profitability and the required number of employees. Second and third quarter revenues are typically the highest of the year, as a greater number of projects are underway and operating conditions, including weather, are normally more accommodating.

CCCI’s Ability to Obtain New Projects and Manage Existing Projects

CCCI bids on projects that it believes offer an opportunity to meet our profitability objectives or that offer the opportunity to enter promising new markets. Our purpose-built engineering estimating software allows us to provide bids in a timely manner with high-level of data accuracy. The potential customers often conduct rigorous competitive processes for awarding contracts. CCCI will potentially face strong competition and pricing pressures for any additional contract awards from other government agencies, and CCCI may be required to qualify or continue to qualify under various multiple award task order contract criteria. See “Risk Factors—Risks Related to Industry Verticals—Construction.”

CCCI is subject to variation in scope and cost of projects from our original projections. In certain circumstances, CCCI seeks to collect or assert claims against customers, engineers, consultants, subcontractors or others involved in a project for additional costs exceeding the contract price or for amounts not included in the original contract price. Our experience has often been that customers have been willing to negotiate equitable adjustments to the contract compensation or completion time provisions if unexpected circumstances arise. However, this process may result in disputes over whether the work performed is beyond the scope of the work included in the original project plans and specifications or, if the customer agrees that the work performed qualifies as extra work, the price that the customer is willing to pay for the extra work. See “Risk Factors—Risks Related to Industry Verticals—Construction.”

Our costs primarily consist of payroll, equipment, materials, and other project related expenses. Our contracts are typically fixed price, and if CCCI is unable to accurately estimate the overall risks, requirements or costs when it bids on or negotiate a contract that is ultimately awarded to us, CCCI may achieve a lower than anticipated profit or incur a loss on the contract due to higher than estimated costs. Additionally, our costs and profitability can be adversely affected by factors such as inflation, tariffs, supply chain and other operational inefficiencies. Our future growth also depends on our ability to accurately estimate and control construction costs, a major part of which consists of implementing AIAI’s Artificial Intelligence in our engineering, estimating, and operational processes going forward. Also, our labor and training expenses may increase as a result of a shortage in the supply of skilled personnel. CCCI strives to minimize exposure to labor and material price increases in our project bids and the manner in which its executes its work. In our fixed price contracts, CCCI attempts to insulate ourselves from the unfavorable effects of inflation, when possible, by incorporating escalating wage and price assumptions into our construction cost estimates, by obtaining firm fixed price quotes from major subcontractors and material suppliers, by securing purchase commitments for materials early in the project schedule and by including contingency for these risks in our bid price. Construction and other materials used in our construction activities are generally available locally from multiple sources. See “Risk Factors.”

CCCI’s Ability to Obtain Bonding Will Have a Material Impact on Its Business

CCCI is often required to provide surety bonds securing our performance under our contracts. Our ability to obtain surety bonds primarily depends on our working capital, past performance, capitalization, credit rating, management expertise, overall capacity of the surety market and other factors. If CCCI is unable to obtain reasonably priced surety bonds in the future, it could significantly affect our ability to be awarded new contracts and could, consequently, have a material adverse effect on its business, results of operations and financial condition.

Constellation Network, Inc.

General

Since its founding in 2017, Constellation Network, Inc. (Constellation) has established credibility across both public and private sectors through the development and validation of its Hypergraph network technology. Constellation has successfully delivered secure, scalable, and verifiable decentralized infrastructure to the U.S. Department of Defense, completing one of the first government contracts to demonstrate applied decentralized infrastructure for data assurance. These achievements underscore Constellation’s ability to bridge cutting-edge blockchain innovation with mission-critical enterprise and government use cases.

Business and Technology

Constellation operates as a multi-layer organization developing applications, software, and hardware that leverage its native decentralized network, the Hypergraph blockchain. Hypergraph is designed for compatibility with existing digital workflows, providing a flexible foundation for modern, data-driven systems. Constellation’s Hypergraph network is a distributed ledger framework designed to support multiple independent application-specific environments in parallel. Rather than functioning as a single monolithic blockchain, the Hypergraph network provides a shared coordination and settlement layer that enables distinct networks, built on Constellation’s Hypergraph, to define and execute their own validation logic, data structures, and transaction types while anchoring their results to a common network for ordering and finality. Each application-specific blockchain deployed on the Hypergraph network submits cryptographically verifiable summaries of activity of the network’s coordination layer. This architecture allows different applications to process data concurrently without competing for block space, while still benefitting from shared security and interoperability. The Hypergraph network does not impose a single execution model or use case, and it is designed to accommodate a wide range of data-driven applications.

Through Constellation OS (“Constellation Open Source”), Constellation provides developer tools, APIs, and software components that integrate open-source technologies with the Hypergraph to modernize enterprise systems. These tools enable developers to issue digital assets, create decentralized application-specific networks, integrate digital wallets, and verify custom data streams. Hypergraph’s microservice-based architecture supports a wide range of business logic and data use cases, offering scalability and interoperability beyond traditional linear blockchains.

Digital Evidence Platform

Constellation’s Digital Evidence platform is a proprietary solution designed to bring verifiable data integrity to the big data sector. Built on the Constellation Open Source framework, Digital Evidence combines Constellation’s decentralized network technology with enterprise-grade tools for data verification, auditability, and automation.

Unlike conventional data assurance systems, Digital Evidence provides a multi-tenant, scalable framework that enables organizations to verify and exchange data with cryptographic certainty. The platform addresses the growing demand for trusted, audit-ready data exchange across high-security and data-intensive industries, including mobility, Internet of Things (IoT), real-world assets, communications, artificial intelligence, healthcare, and finance.

As concerns over data privacy, cybersecurity, and the reliability of centralized systems continue to rise, Constellation’s proprietary approach delivers decentralized, cryptographically secured, and scalable data solutions that modernize and transform enterprise and government data infrastructures with verifiable automation.

Strategic Position and Outlook

Constellation’s core technology and ecosystem development strategy position us to capitalize on the increasing demand for secure, interoperable, and verifiable data systems. Constellation continues to develop commercial partnerships and integrations that extend its Hypergraph technology into real-world, revenue-generating applications.

Constellation believes that its architecture - combining blockchain-grade security, enterprise composability, and AI integration - will play a critical role in the evolution of trusted digital infrastructure across both public and private sectors. Our licensed AI technology is expected to catalyze the blockchain-based verification and audit capabilities provided by Constellation. Under this model, our AI platform is intended to function as an application-layer interface that assists our Portfolio Companies in interpreting data, generating insights, and supporting operational decision making within their own environments. Constellation’s role in these solutions is to provide a distributed ledger layer that can be used to cryptographically anchor records related to data provenance, policy enforcement, and AI-generated outputs. This enables verifiable audit trails and accountability without embedding AI logic into the network protocol or storing sensitive underlying data on-chain. Any such AI-enabled solutions would be deployed at the application or enterprise level for specific use cases, such as compliance monitoring, data governance, or operational analytics and would not participate in participate in transaction validation, network security, or protocol governance.

Operations

Constellation generates revenue through multiple streams including government contracts, blockchain infrastructure services and fees, digital asset sales, hardware and SaaS subscription revenue through its retail analytics platform, and data verification services through emerging enterprise products like Digital Evidence. Constellation’s technological framework allows custom blockchain deployments with the ability to incorporate licensing fee structures and traditional SaaS subscriptions.

Constellation’s operations are characterized into the following principal areas:

Digital asset operations

Digital evidence data validation services

Retail analytics technology

Blockchain infrastructure and Web3 services

Future Acquisitions

We expect our portfolio to continue to evolve and grow to capitalize on emerging opportunities and optimize overall ecosystem value. Our management and acquisition teams maintain a deep, broad network of relationships among key market participants. We believe these relationships and our research-driven origination methods provide us access to off-market opportunities that may not be available to our competitors.

In executing our acquisition strategy, we will integrate newly-acquired entities through the application of the AIAI integration model, which provides a structured yet flexible approach to technological and operational integration, enabling consistent execution while accommodating the unique characteristics of each business. This model balances autonomy with collaboration, leveraging a shared AI platform and cross-vertical data synergies to create adaptive intelligence. This model consists of three stages:

Acquisition Pipeline

Our executive management and acquisition team maintains a deep, broad network of relationships among a wide range of market participants, including owners and lenders. We believe these relationships, along with active participation from our board members and the Portfolio Company management teams and our research-driven origination methods, provide us access to multiple acquisition opportunities, many of which may not be available to any of our competitors. As a result of the significant need for liquidity among an ever-increasing number of privately held companies, many of which fit within our investment criteria, we believe there will be an ample supply of attractive acquisitions in the future.

In the normal course of our business, we will regularly evaluate the market for companies that fit within our investment criteria to identify potential acquisition targets. As of the date of this prospectus, we are evaluating potential acquisitions with an aggregate of approximately $1.5 billion in EBITDA that we have identified as warranting future investment consideration after initial review. As of the date of this prospectus, we have neither entered into letters of intent nor purchase agreements with respect to any potential acquisitions nor have we begun a comprehensive due diligence review with respect to any of these companies. Accordingly, we do not believe that the acquisition of any of the companies under evaluation is probable as of the date of this prospectus. Following the completion of the Offering, we will aggressively resume discussions with our pipeline of potential acquisitions which we had paused in anticipation of engaging in the Offering and expect rapid progress.

Our Licensed Technology

We will enter into a license agreement with M42 immediately prior to the effective time of the Registration Statement of which this prospectus forms a part pursuant to which the company will be granted exclusive use of the integrated M42 Behavioral (Psychometric) and Mathematics and Science AI (together, the “M42 AI Technology”) within the designated field of use. See “—License Agreement.” Additionally, on the effective date of the Registration Statement of which this prospectus forms a part, we will indirectly own approximately 5.4% of the outstanding equity of M42. This proprietary technology represents what we believe is an advance in how machines can understand and predict human behavior over and includes certain fundamental building blocks of Math and Science designed to rapidly deploy industry independent AI solutions. A crucial but often overlooked aspect of AI is Psychometric AI (PAI) with its powerful capability for making non-obvious inferences about behavioral patterns and future actions. Most AI systems available today, outside of the technology we are licensing from M42, are based on Machine Learning, or ML. ML includes things like generative AI—the kind that can write text, draw pictures, or predict outcomes based on patterns derived from huge amounts of past data. These systems need to be “prompted” by human beings and usually learn through trial-and-error process guided by people. The technology we are licensing works very differently. It is based on a deep base of math and science inside a flexible platform that combines PAI and standard AI. Instead of relying mostly on ML, our system uses many different branches of computer science and AI that work together, learning from both data and behavior. This allows it to study people, markets, or companies and figure out what works best—often in hours or days instead of months.

The key difference is that traditional ML mainly copies or imitates what it is taught, following preset rules that limit what it can do. The technology that we are licensing, on the other hand, is supported with more than a billion lines of code and advanced math that let it do something called “nonmonotonic reasoning.” That means it does not need someone to tell it exactly what the end goal is. It can explore problems, adapt, and learn on its own to find the best path forward. Because of this, our licensed technology is moving closer to true Artificial General Intelligence (AGI)—the kind of AI that can think and reason more like a human being. It does this by solving tough challenges, like turning massive, complex calculations into near-instant results, using adaptive reasoning and blending both prior knowledge and new learning to keep improving.

The core principle of our licensed technology is that true advanced artificial intelligence should be rooted in mathematics but always interpreted through the lens of human experience. Unlike conventional AI, which in our experience often focuses narrowly on modeling historic data, PAI is engineered to capture and integrate essential human attributes such as creativity, reasoning, perception, and empathy. Mainstream AI, which is built on machine learning, statistics, and deterministic algorithms, excels at pattern recognition and language processing, but often produces outputs that lack depth, context, or genuine understanding. M42’s PAI, by contrast, delivers more nuanced, creative, and human-like results on top of the rich Math and Sciences. Our licensed AI is designed “with the end in mind,” integrating hundreds of mathematical and scientific fields to create a platform that measures up to the full breadth and depth of human intelligence.

License Agreement

Under the License Agreement, M42 will grant us a license for the exclusive use of the M42 AI Technology, consisting of data sources, object code, and APIs, along with industry specific template applications which are directly applicable to several of the aforementioned applications, within the designated “field of use.” As a result, M42 may not, and will cause its affiliates (other than AIAI) not to, use or exploit the licensed AI technology or compete with our company within the field of use. “Field of use” is defined under the License Agreement to mean use of the M42 AI Technology in a business model substantially similar to our company’s business model, which includes creating and operating an AI-powered ecosystem to scale companies across multiple industry segments with the expectation of improving operating results through the application of the licensed AI technology. In addition, the License Agreement prohibits M42 from providing services or solutions to any person identified in writing by us to M42 as potential acquisition targets. Pursuant to the License Agreement, we issued approximately 25,137,000 Shares to M42 as consideration for the perpetual use of the licensed technology. In addition, we are entering into a Technology Services Agreement with M42 concurrently with the License Agreement under which we have agreed to pay M42 an annual fee of 3% of our annual revenues in consideration for ongoing development work, including, among other things, any operational elements, features and functional design specifications as requested by our company. We have no further payment obligations under the License Agreement. The License Agreement permits us to sublicense the technology to and through our Portfolio Companies subject to the same terms as the License Agreement, and the sublicense shall revert back to us in the event that a Portfolio Company is sold or that the License Agreement is terminated. The License Agreement is perpetual but may be terminated by M42 for “Cause,” which is defined to include, among other things, the bankruptcy of AIAI and AIAI’s breach of a material term of the contract that is not cured within the applicable cure period.

The Application of AI to Specific Industry Segments

Set forth below are examples we believe demonstrate how the application of AI to companies in the industry segments that we are targeting should be able to improve their operations.

Construction

AI is reshaping the construction industry by enhancing efficiency, safety, and sustainability, particularly in the use of heavy equipment and broader operations, as described below:

Challenges and Considerations:

Future Potential:

Medical

AI is significantly transforming the U.S. medical vertical, enhancing patient care, operational efficiency, and innovation across healthcare systems. Below are key ways AI is making a positive impact, tailored to the U.S. context:

Challenges and Considerations:

Future Potential:

Employees

Immediately following the effective date of the Registration Statement of which this prospectus forms a part, we will have 16 full-time employees across our administration, acquisition, implementation, marketing, and administrative functions. None of our employees will be subject to a collective bargaining agreement or represented by a trade or labor union. We consider our relationship with our employees to be good. Our human capital strategy focuses on attracting, developing, and retaining exceptional talent across all areas of our organization. We have developed comprehensive training programs to ensure our employees maintain the highest levels of expertise in our technology and implementation methodologies.

Properties

We do not currently own any properties. We lease the space at which our corporate headquarters are located.

Government Regulation

The regulatory environment in which we and our Portfolio Companies operate requires careful attention to multiple frameworks and requirements. We maintain comprehensive compliance programs addressing data privacy regulations, including GDPR, CCPA, and HIPPA, as well as sector-specific requirements in healthcare, financial services, and other regulated industries, Our technology incorporates privacy protection and security measures from the ground up, enabling us to comply with applicable requirements while delivering effective solutions. We also actively monitor and participate in the development of AI-specific regulations and standards, aligning our technology and implementation practices with emerging regulatory requirements.

Legal Proceedings

We are not currently involved in any legal proceedings; however, we may in the future be involved in actual and/or threatened legal proceedings, claims, investigations, and government inquiries arising in the ordinary course of our business, including legal proceedings, claims, and governmental inquiries involving intellectual property, data privacy, and data protection, consumer protection, securities, employment, contractual rights, civil rights infringement, false or misleading advertising or other legal and/or regulatory proceedings relating to our business.

Competition

Our acquisition-focused business model faces competition from multiple sources that may impede our ability to identify and successfully acquire target companies or realize anticipated operational improvements and revenue growth.

Competitive Landscape

We compete with several categories of market participants:

Software and AI Platform Providers. The growing availability of AI-powered solutions from enterprise software vendors, specialized AI vendors, technology platforms, cloud providers, and emerging technology firms operating on a license or SaaS basis may enable companies to improve operations independently, potentially reducing the pool of attractive acquisition targets, impacting a potential target company’s willingness to be acquired, or diminishing the incremental we can deliver to acquired companies.

Internal Development Efforts. Organizations that could be acquisition targets may choose to build proprietary AI and data platforms internally rather than being open to acquisition. These internal efforts typically involve combinations of custom development, open-source software, packaged enterprise solutions, and significant IT resources. Companies pursuing internal development may view their technology initiatives as core strategic assets, making them less receptive to acquisition or reducing the operational improvements we can achieve post-acquisition.

Private Equity and Strategic Acquirers. We compete with other acquisition-focused entities, including private equity firms, strategic corporate buyers, and special purpose acquisition companies (SPACs), for attractive acquisition targets. Many of these competitors have substantially greater financial resources, broader industry networks, more established track records, and may offer higher valuations or more attractive deal terms. Some competitors are developing or acquiring their own operational improvement capabilities, including AI-driven solutions.

Consulting and Services Firms. Management consultancies, IT services providers, and system integrators offer operational improvement services to companies using third-party or proprietary AI technologies. These firms may engage with potential acquisition targets in ways that either improve their operations (reducing our potential value creation) or establish relationships that make acquisition more difficult.

Government Contractors and System Integrators. Particularly for targets serving government or regulated industries, we face competition from established contractors and integrators with existing relationships, security clearances, and compliance frameworks that may be difficult to replicate.

Competitive Factors and Challenges

While we believe we generally compete favorably with our competitors, our ability to compete successfully depends on numerous factors, many of which are outside our control:

Acquisition Capabilities. Our success depends on identifying suitable targets matching our CURA parameters, negotiating favorable terms, securing financing, and completing transactions efficiently. Competitors with greater financial resources, higher risk tolerance, or more flexible acquisition criteria may outbid us or move more quickly.

Technology Differentiation. The differentiation, effectiveness, and uniqueness of the proprietary technology we are licensing, compared to alternatives available to potential targets through software and AI providers, internal development, or consulting engagements. Additionally, the rapid pace of AI innovation means that our technological advantages may diminish as competitors develop similar or superior capabilities.

Integration and Execution. Our ability to successfully acquire targeted companies and implement our AI solutions to achieve projected operational efficiencies and revenue growth, compared to alternatives pursued by targets or offered by competitors. Integration failures or slower-than-expected results could damage our reputation and competitive position.

Pricing and Returns. The acquisition prices we pay, integration or implementation costs we incur, and returns we generate compared to alternatives available to selling shareholders and relative to our cost of capital. Competitive pressure on acquisition valuations may compress our margins and returns.

Relationships and Deal Flow. Our network of relationships with intermediaries, industry participants, and potential sellers compared to competitors with longer operating histories, larger transaction volumes, or stronger brand recognition in specific industries or geographies.

Financial and Operational Scale. Many competitors have greater financial resources to fund larger acquisitions or portfolio strategies, absorb integration failures, and outbid us for attractive targets. Larger competitors can also spread fixed costs across broader portfolios.

Market Position and Brand. Established competitors often have stronger brand recognition, longer operating histories, larger customer bases for their technologies, and more extensive case studies demonstrating successful outcomes. This may make potential acquisition targets more receptive to their approaches.

Geographic and Industry Reach. Some competitors have broader geographic presence, deeper relationships in specific industries or regions, and better access to potential acquisition targets in certain markets.

Technology and Intellectual Property. Certain competitors possess larger patent portfolios, more mature technology platforms, or greater R&D resources. Some competitors benefit from lower development costs due to geographic advantages or greater ability to attract technical talent.

Sales and Distribution. Technology vendors and consulting firms often have established sales forces, partner networks, and customer relationships that provide advantages in accessing potential targets or establishing relationships that complicate our acquisition strategies.

Risks Related to Our Competitive Position

If we cannot compete successfully, we may experience difficulty executing our business strategy:

Target Scarcity and Valuation Pressure. Increased competition for acquisition targets meeting our criteria could reduce deal flow, inflate acquisition prices, or force us to accept less favorable terms, potentially reducing returns and limiting our growth.

Technology Obsolescence. Rapid advances in AI technology could render the technology that we are licensing less competitive, requiring significant additional investment to maintain our value proposition or reducing the operational improvements we can deliver to acquired companies.

Implementation Challenges. If competitors develop superior implementation methodologies or technologies, or if our efforts underperform relative to expectations or alternatives, our ability to attract future sellers and justify acquisition valuations may be impaired.

Reputational Risk. Failed acquisitions, implementation difficulties, or underperformance relative to competitors could damage our reputation with potential sellers, financing sources, and other stakeholders critical to our strategy.

Intellectual Property Limitations. While our licensed technology is protected through trade secrets and/or proprietary information agreements, these protections have inherent limitations. Trade secrets may be independently discovered or reverse-engineered by competitors. Patents have finite terms, may be challenged or invalidated, and may not prevent competitors from developing non-infringing alternatives. The licensing arrangement itself creates dependency on our relationship with M42. Competitors developing their own intellectual property may not face these constraints.

Our competitive position ultimately depends on continuous innovation, successful execution of our acquisition strategy, and our ability to demonstrate superior returns compared to alternative uses of capital and alternative operational improvement approaches available to potential acquisition targets.

MANAGEMENT

Directors, Executive Officers and Director Nominees

The following table provides information regarding our directors, officers and director nominees as of the date of this prospectus.

Each of our directors will hold office until the fourth annual meeting of our stockholders following the date pf this prospectus and thereafter will hold office until the next annual meeting of our stockholders or, in either case, until his or her successor has been elected and qualified or until his or her death resignation, or removal. Our executive officers are appointed by our Board of Directors and hold office until their death, resignation, or removal from office.

Directors

John P. Rochon, Ph.D.

John P. Rochon, Ph.D., is the founder of AIAI and the Founder of, and served as the Chairman of M42, a strategic investment firm focused on deep tech and life sciences, since 2020. He is a highly accomplished American businessman, investor, and philanthropist with more than four decades of success across finance, operations, business planning, marketing, political strategy, and private equity. By the age of 40, he served as Chairman and CEO of Mary Kay Inc., where he led the successful leveraged buyout (“LBO”) of the company, one of the most notable private transactions in the early era of consumer-focused LBOs. Over the course of his career, he has led or participated in more than 350 business transactions across a wide range of industries.

Mr. Rochon is the founder of Richmont Capital Partners, a private investment and business holding company, and the Rochon Family Office, a multi-billion-dollar single-family office headquartered in Dallas, Texas.

In addition to his investment and board work, Mr. Rochon is actively involved in philanthropic initiatives focused on preventing sexual violence and child trafficking, including funding advanced Psychometric AI, driven behavioral pattern detection programs through the Rochon Family Trust.

He holds a B.Sc. from the University of Toronto (University College) and an MBA from the University of Toronto (Rotman School of Management) and conducted Ph.D. coursework at the University of Texas at Dallas. Mr. Rochon holds Doctor of Philosophy degrees from three universities with technology research profiles: Kiev National University, the Royal Academy of Economics and Technology (Switzerland), and WSB University (Poland). We believe that Mr. Rochon’s extensive knowledge of AI technology and his extensive corporate and leadership experience as the founder of our company and M42 qualify him to serve on our Board of Directors.

Todd A. Furniss

Todd A. Furniss is a seasoned executive, private equity investor, and healthcare strategist with over 35 years of global experience spanning operations, consulting, and investment across the Americas, Europe, and Asia. He is the Founder of, and has been CEO of gTC Group, a private equity firm focused on middle-market healthcare and business services companies, since 2011 Mr. Furniss also leads TFIP Group, a private equity firm focused on middle-market services companies.

Mr. Furniss also leads TFIP Group, a healthcare research firm dedicated to developing and advocating for improvements to the U.S. healthcare system to make it more accessible, less complex, and more affordable. He is a published author (The 60% Solution: Rethinking Healthcare), a recognized thought leader on healthcare and public policy, and a frequent media contributor.

Mr. Furniss is a co-founder of PlumTree Partners, a private equity firm launched in 2008, was the President and COO of the Everest Group, a consulting and research firm, and an executive at EDS, where he led large-scale business development initiatives and M&A strategies totaling over $6.5 billion.

He serves on multiple boards, including Parkland Health, where he chairs the Audit Committee, and Denison Ministries, and has a long-standing commitment to civic and charitable causes.

Mr. Furniss holds a Juris Doctor from George Mason University School of Law and a B.A. in Political Science from Old Dominion University. We believe that Mr. Furniss’ experience as an entrepreneur and venture capitalist, as well as his experience as a corporate leader and co-founder of our company, qualify him to serve on our Board of Directors.

Jeffrey F. Glajch

Jeffrey F. Glajch is a veteran corporate finance leader with a proven track record of driving financial strategy, operational efficiency, and enterprise growth across global industrial and specialty chemical companies. He served as Chief Financial Officer of Orion S.A. from April 2022 until December 2025, where he oversaw corporate finance, investor relations, risk management, IT and corporate sustainability. Prior to that, Mr. Glajch served as the Chief Financial Officer of Graham Corporation from March 2009 until April 2022.

Mr. Glajch has held senior financial leadership roles at companies including Graham Corporation, Air Products, Great Lakes Chemical, Fisher Scientific, and Walt Disney World Co., with experience spanning both public and private enterprises. His strategic and operational oversight has supported growth initiatives across North America and international markets. He has extensive experience in business development, IT and Human Resources.

In addition to his executive responsibilities, Mr. Glajch has been active on multiple advisory boards such as the Colorado State University Finance Department. He is also involved in organizations supporting individuals with disabilities.

Mr. Glajch holds an MBA from Purdue University, a MS in Administrative Science from Johns Hopkins University, a MS in Chemical Engineering from Clarkson University, and a B.S. in Chemistry from Carnegie Mellon University. We believe that Mr. Glajch’s financial expertise, as well as his experience as the financial officer of multiple entities, including the chief financial officer of a public company, qualify him to serve on our Board of Directors.

Andrew Schaap

Andrew Schaap is a seasoned executive and digital infrastructure innovator with more than 25 years of leadership experience across data centers, IT, private equity, and real estate. He has served as the CEO of Aligned Data Centers since June 20, 2017, where he leads one of North America’s fastest-growing data center platforms, delivering adaptive and sustainable infrastructure solutions for hyperscale and enterprise clients. Under his leadership, the company has achieved over 65x growth, completed international acquisitions, and executed multi-billion-dollar capital raises, while championing environmental and operational efficiency.

Prior to joining Aligned, Mr. Schaap spent over a decade at Digital Realty Trust (NYSE: DLR), where he served as Senior Vice President and led global client-driven builds and major international transactions across Asia-Pacific. His earlier roles include executive positions at Sterling Network Services and Sysix Technologies.

Mr. Schaap currently serves on the boards of DC Delta, Aligned Data Centers, and the Infrastructure Masons Advisory Council, and is a mentor with Great Minds in STEM, promoting diversity and access in technology education. He also advises the SMU Lyle School of Engineering, where he helped launch the world’s first Master’s program in Datacenter Systems Engineering.

He holds a B.A. in Business Administration and Marketing from Cornerstone University and has completed executive programs in Negotiation and Management Training at Harvard University. We believe Mr. Schaap’s extensive corporate and leadership experience, including executive positions at numerous entities, coupled with his private equity experience, qualify him to serve on our Board of Directors.

Honorable Donald M. Remy

The Honorable Donald M. Remy is a respected leader in public service, corporate governance, and legal affairs, with a distinguished career spanning government, law, sports, and business. He is the Founder and CEO of The Remy Group, a consulting firm advising global clients on strategy, compliance, and leadership development. Secretary Remy has served in his current capacity since April 2023.

From 2021 to 2023, Secretary Remy served as the 9th Deputy Secretary of the U.S. Department of Veterans Affairs. As Chief Operating Officer, Remy oversaw a $325 billion budget and led the largest integrated healthcare, benefits, and memorial affairs systems in the United States.

He previously served as Deputy Assistant Attorney General at the U.S. Department of Justice; Assistant General Counsel of the U.S. Army; Senior Vice President, Deputy General Counsel, and Chief Compliance Officer of Fannie Mae; Chief Operating Officer and Chief Legal Officer at the NCAA; and partner at Latham & Watkins and O’Melveny & Myers, specializing in complex litigation and regulatory matters.

Remy currently serves on several corporate and nonprofit boards, including The Mayo Clinic, AlixPartners, Granicus, Verus, and The Congressional Award. He is a recipient of the U.S. President’s Lifetime Achievement Award and has been recognized by Forbes, Savoy, Financial Times, and Black Enterprise as one of the most influential figures in law, business, and sports.

He earned his undergraduate degree from Louisiana State University and his law degree, cum laude, from Howard University School of Law. Remy served as an officer in the United States Army and was awarded the National Defense Service Medal and the Meritorious Service Medal. We believe that Mr. Remy’s extensive corporate and leadership experience, including the unique perspective that he brings as the former Deputy Secretary of the U.S. Department of Veteran Affairs, qualifies him to serve on our Board of Directors.

Doohi Lee, MD

Dr. Doohi Lee is a board-certified physician and nationally recognized leader in regenerative medicine, cosmetic surgery, and laser therapies. As Founder and Medical Director of Advanced Surgical Arts in Plano, Texas, he integrates minimally invasive surgical techniques with advanced biologics such as stem cells, PRP, and exosomes to promote healing and natural aesthetic outcomes. Dr. Lee also oversees Mind for Life Brain Center and Texas Diagnostics & Surgery, where he applies a holistic approach to both external rejuvenation and internal health optimization.

Over his multi-decade career, Dr. Lee has served as an adjunct professor at UT Southwestern and held academic appointments at Albany Medical College and New York Medical College. He was among the first physicians in the Dallas–Fort Worth area to be board certified in vein medicine and is credited with introducing musculoskeletal ultrasound to the U.S. Olympic Team in 1996. He also served as a medical educator for NASA astronauts aboard the International Space Station.

Dr. Lee is the creator of the Diamond Matrix®, a comprehensive framework that applies principles of integrative medicine to support full-spectrum wellness. He has earned numerous awards, including a Gold Medal from the American College of Phlebology, and has authored peer-reviewed publications and book chapters in musculoskeletal imaging and regenerative medicine. He currently serves as an editorial reviewer for several medical journals and remains active as a speaker, consultant, and international educator in laser technologies and aesthetic surgery.

Dr. Lee earned his M.D. from Case Western Reserve University School of Medicine, completed a fellowship in musculoskeletal radiology at the Hospital for Special Surgery, and holds a B.S. in biomedical engineering from Case Institute of Technology. He has completed multiple post-graduate fellowships and is board certified in regenerative medicine, anti-aging medicine, aesthetic medicine, laser surgery, phlebology, pain management, and diagnostic radiology. We believe Dr. Lee’s extensive experience in the healthcare section, as well as his academic and entrepreneurial experience, qualify him to serve on our Board of Directors.

Eric L. Affeldt

Eric L. Affeldt is an accomplished executive and board leader with a distinguished track record in operations, strategic growth, and private equity across the travel, leisure, and healthcare sectors. He has served as Chairman of Strata Critical Medical, Inc. (Nasdaq: BLDE), a technology-powered global organ transplant logistics and other medical services platform, since May 2021. Prior to then, Mr. Affeldt served as Chief Executive Officer from May 2019 to May 2021 and Chairman from September 2019 to May 2021 of Experience Investment Corp., which entered into a business combination with Blade in May 2021. He also serves as a director of Eisenhower Health, a nonprofit community health system based in Rancho Mirage, California. He is the past Chairman of Vail Health, a nonprofit community health system based in Colorado, and is a past Chairman of The George W. Bush Presidential Center Executive Advisory Council.

From 2006 to 2017, Mr. Affeldt served as President and Chief Executive Officer of ClubCorp (NYSE: MYCC), the world’s largest owner and operator of private golf and dining clubs. Under his leadership, ClubCorp underwent transformative growth, including its public listing on the NYSE and eventual $2.2 billion sale to Apollo Global Management in 2017. Before joining ClubCorp, he was a principal at KSL Capital Partners, a private equity firm focused on travel and leisure investments. He previously served as President and CEO of KSL Fairways, Doral Golf Resort and Spa in Florida, and the combined PGA West and La Quinta Resort and Club in California. He also held the role of President at General Aviation Holdings, Inc.

Mr. Affeldt has served on numerous public and private boards, including as Non-Executive Chairman of Cedar Fair Entertainment Company (NYSE: FUN) from 2010 to 2019. He is a former member of the Young Presidents Organization (YPO), the former manager of the Belgian National Baseball Team, and has been a director of Vail Health since 2017.

Recognized for his leadership and integrity, Mr. Affeldt was named Golf Inc. Magazine’s “Most Powerful Person in Golf” in 2010, 2014, and 2015. He received the Cecil B. Day Ethics Award from Florida State University’s Dedman School of Hospitality in 2013 and was inducted into the University of Houston’s Hospitality Hall of Honor in 2016. In 2015, he was named “Best CEO” in the consumer leisure sector by Institutional Investor and was also named to the Institutional Investor All-America Executive Team.

Mr. Affeldt holds a B.A. in Political Science and Religion from Claremont McKenna College (1979). We believe Mr. Affeldt’s extensive corporate and leadership experience, including his experience as an executive and director of multiple public companies, qualify him to serve on our Board of Directors.

Honorable Jeanne L. Phillips

Ambassador Jeanne Phillips is a seasoned diplomat, business executive, and civic leader with a distinguished career in both public service and corporate affairs. She served for 23 years in various leadership roles at Hunt Consolidated, Inc., where she has served as Senior Vice President of Corporate Engagement and International Relations since 2004. In such capacity she has led the company’s global government relations, media strategy, and philanthropic initiatives. She also served as President of Hunt Global Partnerships, the company’s social impact platform focused on building sustainable community partnerships worldwide. She now serves as Senior Counsel to Hunt Consolidated, Inc. Ambassador Phillips is also the founder and president of JLP Global Strategies, Inc., a boutique consulting firm advising public and private companies on corporate governance, crisis management, and media strategy.

From 2001 to 2003, Ambassador Phillips served as the U.S. Permanent Representative to the Organization for Economic Co-operation and Development (OECD) in Paris, France, appointed by President George W. Bush. During her tenure, she championed anti-bribery enforcement, corporate governance reform, and modernization efforts within the OECD. She also previously held senior roles in U.S. presidential inaugurations, serving as Executive Director of the 54th and Chairman of the 55th Presidential Inaugural Committees.

Ambassador Phillips has served on several corporate and nonprofit boards, including Murphy USA Inc., Turtle & Hughes Inc., and the George W. Bush Presidential Center, where she continues to shape policy and leadership initiatives. Other boards on which Ambassador Phillips serves include Southern Methodist University and Austin Street Center, as well as the Dallas Economic Development Corporation Board.

She holds a B.A. from Southern Methodist University. We believe Ambassador Phillips’ extensive corporate and executive experience, as well as the unique perspectives she brings as a former U.S. ambassador and the founder of and active participant in numerous media, crisis management, and philanthropic organizations, qualify her to serve on our Board Directors.

Melvin Greer, Ph.D.

Dr. Melvin Greer is a nationally recognized data science and artificial intelligence leader with more than two decades of experience driving innovation across government, commercial, and academic sectors. Dr. Greer has served as Intel Fellow and Chief Data Scientist at Intel Corporation since 2016, where he is responsible for advancing the company’s AI and data science platforms, with expertise spanning machine learning, neuromorphic computing, and blockchain security models. Dr. Greer is currently Senior Vice President and Chief AI Officer at Tech Elevate Innovation Labs.

Dr. Greer holds multiple patents and has authored five books and over 400 research papers, with his work cited more than 4,000 times globally. He serves as a Senior Advisor to the FBI IT and Data Division, and at UC Berkeley’s Goldman School of Public Policy, where he shapes national policy on emerging technologies. He also teaches AI applications as an adjunct faculty at Johns Hopkins University.

A recipient of numerous awards, including the BEYA Technologist of the Year, the BDPA Lifetime Achievement Award, and LinkedIn’s Top 10 Voices in Data Science, Dr. Greer is a board member of the U.S. National Academy of Science, Engineering, and Medicine.

He earned his Ph.D. in Data Management from International American University and holds advanced degrees in computer information systems and information systems from American University. We believe Dr. Greer’s extensive experience with AI and other technology, including obtaining patents and authoring research materials, as well as his experience as a Senior Advisor to the FBI, qualify him to serve on our Board of Directors.

Brigadier General (Ret.) Guy Thomas

Brigadier General (Ret.) Guy Thomas Cosentino is a highly respected strategic advisor and national security expert with over three decades of operational, geopolitical, and executive leadership experience. He has also served as Chief Executive Officer of Governance Risk Global Holdings (GRG) since December 2023, where he leads initiatives in risk assessment, brand protection, operational resilience, and capital delivery strategies for companies operating in defense, national security, and infrastructure.

From 2015 to present, he has served as President of Cosentino Strategic Solutions, a private consulting and advisory firm for companies operating in the defense, intelligence, homeland security, energy, and strategic infrastructure fields.

General Cosentino is a strategic advisor to M42, where he focuses on the application of advanced technologies, including Artificial Intelligence, to both private-sector innovation and national defense priorities. He is also Co-Chairman of the Advisory Board for American Battery Factory and a senior advisor to a number of organizations across defense, aerospace, energy, and supply chain resilience, including Cerberus Capital Management, Zeva Holdings/NextGenID, Team Housing Solutions, Baker SCI, and the Middle East Media Research Institute.

Prior to entering the private sector, General Cosentino completed a 31-year career in the U.S. Army, culminating in his role as the 28th Commandant of the National War College, the premier strategic leadership institution serving the U.S. military, civilian agencies, and international allies. His prior assignments included Deputy Director for Political-Military Affairs for the Middle East at the Joint Chiefs of Staff, Deputy Commanding General for Regional Support in Afghanistan (NATO Training Mission), and Chief of Strategy, Plans, and Assessments for the U.S.-led security transition mission in Iraq, where he helped design and implement plans to train and equip over 400,000 Iraqi Army and Police forces. From 2015 to 2023, General Cosentino served as Chief Operating Officer and Secretary of the Board for Business Executives for National Security (BENS), where he oversaw governance activities and advanced strategic dialogue between civilian and military leadership. He continues to support BENS today as a Senior Advisor.

General Cosentino holds a B.S. in Political Science from the University of the State of New York, a Master’s Degree in International Relations from Georgetown University, and a Master’s Degree in National Security and Strategic Studies from the U.S. Naval War College. We believe General Cosentino’s extensive corporate and leadership and public service experience, including his expertise in strategic leadership, qualify him to serve on our Board of Directors.

Executive Officers

Stephanie Liebman

Executive Vice President and Chief Financial Officer

Stephanie Liebman is a strategic financial executive with a distinguished track record of leadership across global enterprises. She has extensive experience in finance operations, process automation, and risk management, Ms. Liebman is known for building high-performing teams, driving operational rigor, ensuring financial integrity, and fostering a culture of accountability and innovation.

Ms. Liebman served as Chief Accounting Officer and Senior Vice President of Finance Operations at HP Inc. from December 2023 to July 2025, where she oversaw global accounting operations, financial controls, and governance processes. She remained at HP Inc. as Senior Vice President, Finance Strategic Advisor through September 2025. From February 2023 to December 2023, she was Senior Vice President and Chief Operations Officer of Finance. Prior to returning to HP for that role, she spent four years at NTT DATA Services, from March 2019 to January 2023 as Senior Vice President and Head of Risk Management, FP&A, and Real Estate. Before her tenure at NTT, Ms. Liebman held several senior leadership roles during an earlier chapter at HP, including Chief Audit Executive and Vice President of Enterprise Services Financial Operations. Early in her career, she held leadership roles at Electronic Data Systems (EDS) and led the global audit integration of EDS into HP.

Throughout her career, Ms. Liebman has received numerous leadership excellence awards and actively participates in multiple professional accounting and leadership organizations.

Ms. Liebman is a Certified Public Accountant (CPA) and Certified Fraud Examiner (CFE). She holds a Bachelor of Science in Accounting from Arizona State University. Her professional credentials and cross-industry experience make her a respected authority in finance governance and strategic enterprise leadership.

Kenneth Betts

Executive Vice President and General Counsel

Kenneth L. Betts has over 40 years of private-practice experience advising companies across a broad spectrum of industries, including commercial real estate, retail, and financial services. Mr. Betts is widely recognized for his deep expertise in capital markets, corporate finance, mergers, and acquisitions. He has represented issuers, underwriters, and placement agents in both public and private equity and debt offerings and has served as outside counsel for corporate governance matters and SEC reporting obligations.

Prior to joining the Company, Mr. Betts served as a partner at Egan Nelson LLP from November 2024 to January 2026. Prior to that, he was a partner at Winston & Strawn LLP from January 2017 to October 2024. His transactional experience spans public and private securities offerings, restructurings, and mergers. He has also advised clients on acquisitions and dispositions of assets and equity securities, reorganizations and recapitalizations, the formation of joint ventures and partnerships, and the structuring and formation of investment funds.

Mr. Betts earned his Juris Doctor from the University of Kentucky College of Law in 1985, after graduating with a Bachelor of Arts in History, with honors, from Stanford University in 1979.

Barbara Barton Weiszhaar

Senior Vice President and Chief Accounting and Tax Officer

Barbara Barton Weiszhaar is a seasoned corporate executive with nearly four decades of experience leading global tax, finance, and operational functions. With deep expertise in corporate governance, financial transformation, and strategic leadership, Ms. Weiszhaar has served as a trusted advisor through periods of complex change, including multinational mergers, corporate separations, and compliance modernization. Her ability to align financial operations with broader business goals has earned her a reputation for integrity, innovation, and results-driven leadership.

Ms. Weiszhaar began her career at Electronic Data Systems (EDS), ultimately serving as Chief Tax Officer and supporting key audit and deal functions. Following HP’s acquisition of EDS in 2008, she transitioned to Hewlett-Packard and later HP Inc., holding senior leadership roles including Chief Tax Officer, Interim Controller, and Chief of Staff/COO to the CFO from 2008 to April 2023. In these roles, she led the global tax integration of EDS into HP, oversaw the strategic tax planning during the corporate separation of HP into Hewlett Packard Enterprise and HP Inc., and built a world-class tax and finance function. Her leadership extended across compliance, M&A, audit resolution, financial reporting, and workforce development initiatives. Ms. Weiszhaar has served as Financial Consultant to HP from June 2023.

Ms. Weiszhaar has held numerous board and advisory roles with leading organizations and led many initiatives to support talent development. She has been recognized with several leadership and performance awards.

Ms. Weiszhaar holds a Master of Business Administration from the University of North Texas and a Bachelor of Business Administration in Accounting from Texas State University. Her educational foundation has been central to her success in navigating complex financial landscapes and delivering strategic outcomes throughout her distinguished career.

Family Relationships

There are no family relationships among our directors or executive officers.

Outside Director Compensation Policy

Our Outside Director Compensation Policy was adopted by our Board of Directors and approved by our stockholders in November 2025. Our Outside Director Compensation Policy became effective on the day of the effectiveness of the registration statement of which this prospectus forms a part.

Pursuant to our Outside Director Compensation Policy, each non-employee director, other than Mr. Rochon (or “outside director”), is eligible to receive compensation for his or her service consisting of cash retainers and equity awards. Our Board of Directors may amend, alter, suspend, or terminate the Outside Director Compensation Policy at any time and for any reason, provided that no such amendment, alteration, suspension, or termination will materially impair the rights of an outside director with respect to compensation that already has been paid or awarded, unless otherwise mutually agreed in writing between the outside director and us. The Outside Director Compensation Plan is administered by our Board of Directors or a designated committee of our Board of Directors.

Cash Compensation. Under our Outside Director Compensation Policy, all Non-Founder Outside Directors will be entitled to receive the following annual cash compensation for their services:

For clarity, each Outside Director who serves as the chair of a committee will receive only the additional annual fee for services as the chair of the committee and not the additional annual fee for services as a member of the committee while serving as such chair.

Each annual cash retainer and additional annual fee will be paid quarterly in arrears on a prorated basis to each outside director who has served in the relevant capacity at any point during the immediately preceding fiscal quarter, and such payment will be made no later than 30 days following the end of such immediately preceding fiscal quarter.

Equity Compensation. Outside Directors are entitled to receive all types of awards other than incentive stock options under our 2026 Plan, including discretionary awards not covered under the Outside Director Compensation Policy. Under the Outside Director Compensation Policy, nondiscretionary, automatic grants of equity awards will be made to Outside Directors as follows:

The “value” for the awards of the shares of restricted stock described above means the grant date fair value determined in accordance with U.S. generally accepted accounting principles, or such other methodology as our Board of Directors or a designated committee of our Board of Directors may determine prior to the grant of the applicable award.

Pursuant to our Outside Director Compensation Policy, in the event of change in control, each outside director will be treated in accordance with the terms of our 2026 Plan.

Outside Directors also may be eligible to receive other compensation and benefits, as may be determined by our Board of Directors or a designated committee of our Board of Directors from time to time. In addition, each outside director’s reasonable, customary, and properly documented, out-of-pocket expenses in connection with service on our Board of Directors or any committee of our Board of Directors will be reimbursed by us.

Pursuant to our Outside Director Compensation Policy, no Outside Director may be granted awards with values, and be provided any other compensation (including, without limitation, any cash retainers or fees but excluding any additional compensation earned as a result of being the chair of a committee of our Board of Directors) with amounts that, in any fiscal year, in the aggregate, exceed $250,000. Any awards or other compensation provided to an individual (a) for his or her services as an employee, or for his or her services as a consultant other than as an Outside Director, or (b) prior to the effective date of the Outside Director Compensation Policy, will be excluded for purposes of the foregoing limits.

Compensation Committee Interlocks and Insider Participation

None of the members of our compensation committee is or has been an officer or employee of our company. None of our executive officers currently serves, or during the past fiscal year served, as a member of our Board of Directors or compensation committee of any entity that has one or more executive officers serving on our Board of Directors or compensation committee.

Limitations of Liability and Indemnification

Our amended and restated certificate of incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for:

Our amended and restated bylaws require us to indemnify our directors and executive officers to the maximum extent not prohibited by the Delaware General Corporation Law and allow us to indemnify other officers, employees, and other agents as set forth in the Delaware General Corporation Law.

We will enter into indemnification agreements with each of our directors and executive officers, which require us to indemnify them against expenses, judgments, fines, settlements, and other amounts that any such person becomes legally obligated to pay in connection with any proceeding to which such person is made or threatened to be made a party by reason of the fact that such person is or was a director, officer, employee, or other agent of ours, provided such person acted in good faith and in a manner such person reasonably believed to be in our best interests.

We maintain a directors’ and officers’ insurance policy pursuant to which our directors and officers are insured against liability for actions taken in their capacities as directors and officers. We believe that these provisions in our amended and restated certificate of incorporation and amended and restated bylaws and these indemnification agreements are necessary to attract and retain qualified persons as directors and officers.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers, or control persons, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

CORPORATE GOVERNANCE

Composition of our Board of Directors

Our current Board of Directors consists of John P. Rochon and Todd A. Furniss.

Each of Messrs. Affeldt, Cosentino, Glajch, Greer, Lee, Remy, and Schaap and Ms. Phillips will become directors on the effective date of this offering. Our Board of Directors may establish the authorized number of directors from time to time by resolution. Each of the directors at the time of the Direct Listing will hold office for a three year period, expiring on the date of the fourth annual meeting of stockholders following the date of this prospectus. At each annual meeting of stockholders thereafter, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the next annual meeting following election.

Director Independence

Under the listing requirements and rules of the Nasdaq Stock Market LLC (Nasdaq Listing Rules), a majority of our directors must be independent directors. Messrs. Affeldt, Cosentino, Glajch, Greer, Lee, Remy, and Schaap and Ms. Phillips are considered independent based on the listing standards of Nasdaq. In order to promote open discussion among independent directors, our Board of Directors intends to adopt a policy of regularly conducting executive sessions of independent directors at scheduled meetings led by the lead independent director and at such other times requested by other independent directors. Executive sessions shall not include Messrs. Furniss and Rochon.

Committees of our Board of Directors

Our Board of Directors has established an audit committee, a compensation committee, a risk committee, a nominating and corporate governance committee, a finance, investment and technology committee, and an ethics committee, each of which will operate pursuant to a charter to be adopted by our Board of Directors and will be effective upon the effectiveness of the registration statement of which this prospectus is a part. Our Board of Directors may also establish other committees from time to time to assist our company and our Board of Directors. Upon the effectiveness of the registration statement of which this prospectus is a part, the composition and functioning of all of our committees will comply with all applicable requirements of the Sarbanes-Oxley Act of 2002, the Nasdaq Global Market and SEC rules and regulations, if applicable. Upon our listing on the Nasdaq Global Market, our committees’ charters will be available on our website at www.aiaiholdings.com. The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be part of this prospectus.

Audit Committee

Our audit committee will consist of Messrs. Affeldt, Glajch, and Ms. Phillips. Our Board of Directors has determined that each of these members satisfies the independence requirements under Nasdaq listing standards and Rule 10A-3(b)(l) of the Exchange Act. The chair of our audit committee will be Mr. Glajch, who our Board of Directors has determined is an “audit committee financial expert” within the meaning of SEC regulations. Each member of our audit committee can read and understand fundamental financial statements in accordance with applicable requirements. In arriving at these determinations, our Board of Directors has examined each audit committee member’s scope of experience and the nature of their employment in the corporate finance sector.

The principal duties and responsibilities of our audit committee will include, among other things:

Compensation Committee

Our compensation committee will consist of Messrs. Cosentino, Lee, and Schaap. The chair of our compensation committee will be Mr. Schaap. Our Board of Directors has determined that each of these members is independent under Nasdaq listing standards, a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act.

The principal duties and responsibilities of our compensation committee will include, among other things:

Nominating and Corporate Governance Committee

Our nominating and corporate governance committee will consist of Messrs. Cosentino and Remy and Ms. Phillips. The chair of our nominating and corporate governance committee will be Mr. Remy. Our Board of Directors has determined that each of these members is independent under Nasdaq listing standards.

The nominating and corporate governance committee’s responsibilities include, among other things: