VerifyMe, Inc.
For the period ended Mar 31, 2026. Filed May 15, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 15, 2026
VRME$8.98+10.3%Stored close · as of Sep 30, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0001214659-25-016707
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001214659-26-006262
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 101 previous paragraphs and 81 current paragraphs.
32 unchanged; 16 reworded; 32 added; 51 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 12 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (32)
Current report
As discussed in the section “Partnerships” below, we ceased providing ProActive services to our prior carrier partner in September 2025. In February 2026, we ceased providing Premium services to our prior carrier partner. While we no longer provide ProActive and Premium services to our prior carrier partner, we continue to provide Direct Premium services to our customers who use our prior carrier partner for their shipping needs.
Current report
Beginning in September 2025, we began providing ProActive services to our new Strategic Partner. We are currently establishing the ability to offer our Premium services to our Strategic Partner. We expect to begin broadly offering Premium and Direct Premium services to customers of our new Strategic Partner in the second quarter of 2026.
Current report
Zen Credit Note Repayment
Current report
On May 11, 2026, our $2.0 million promissory note issued under our Loan Agreement with ZenCredit matured and became due and payable. On May 11, 2026, we received from ZenCredit our principal balance of $2.0 million plus our final quarterly interest payment of $80 thousand, and we reversed a credit loss reserve of $12 thousand.
Current report
Nasdaq Delisting Notice
Current report
Merger Agreement
Current report
On February 11, 2026, we entered into the Merger Agreement with the Merger Sub and Open World. Upon the terms and subject to the satisfaction of the conditions described in the Merger Agreement, Merger Sub will merge with and into Open World, Merger Sub will cease to exist and Open World will become our wholly-owned subsidiary. At the Effective Time, (i) each holder of ordinary shares of Open World outstanding immediately prior to the Effective Time (excluding holders of Excluding Shares and Dissenting Shares, as defined in the Merger Agreement) will be entitled to receive the number of shares of our common stock, based on the Exchange Ratio, (ii) each investor in Open World SAFEs outstanding immediately prior to the Effective Time will be entitled to receive a right to a number of shares of our common stock based on the Exchange Ratio and (iii) any outstanding option to purchase shares of Open World shall be converted into an option to purchase the number of shares of our common stock based on the Exchange Ratio.
Current report
Immediately following the Closing, our pre-Closing stockholders are expected to collectively retain approximately 10% of the post-Closing aggregate number of shares of our common stock and holders of Open World ordinary shares and Open World SAFEs will receive as merger consideration newly issued shares of our common stock representing approximately 90% of the post-Closing aggregate number of shares of our common stock.
Current report
The Merger Agreement contains customary representations, warranties and covenants, including, among others, (i) covenants requiring each of us and Open World to conduct its business in the ordinary course during the period between the execution of the Merger Agreement and the Closing or earlier termination of the Merger Agreement, subject to certain exceptions, (ii) covenants prohibiting us and Open World from engaging in certain kinds of transactions during such period (without the prior written consent of the other), and (iii) a covenant restricting us and Open World from activities relating to the soliciting, initiating, encouraging, inducing or facilitating the communication, making, submission or announcement of any alternative acquisition proposals or inquiries.
Current report
The Merger Agreement also requires us, in cooperation with the Open World, to prepare and file with the SEC a registration statement on Form S-4 that will contain a proxy statement relating to a Company stockholder meeting to be held in connection with the Merger (the “Registration Statement”) and pursuant to which our shares of common stock will be registered under the Securities Act of 1933, as amended (the “Securities Act”), to be issued by virtue of the Merger and the contemplated transactions thereunder. We shall use its reasonable best efforts to (i) cause the Registration Statement to comply with applicable rules and regulations promulgated by the SEC, (ii) cause the Registration Statement to become effective as promptly as practicable, and (iii) keep the Registration Statement effective as long as is necessary to consummate the Merger and the contemplated transactions thereunder. In addition, under the Merger Agreement, the parties agreed to other customary provisions including (i) obtaining requisite stockholder approval to consummate the Merger and the contemplated transactions thereunder, (ii) obtaining regulatory approvals from relevant governmental authorities, (iii) indemnifying our directors and officers for a period of six years following the Closing, (iv) completing certain disclosure obligations required by the SEC and listing requirements promulgated by the Nasdaq Capital Market (“Nasdaq”), (v) electing or appointing to the positions of officers and directors of Company and the surviving corporation certain persons designated by Open World, and (vi) executing employment agreements between us and Adam Stedham and Jennifer Cola.
Current report
Pursuant to Merger Agreement, we have also agreed to enter into a Registration Rights Agreement and an Exchange Agent Agreement in forms reasonably acceptable to us and Open World at Closing.
Current report
Closing of the Merger is subject to various customary closing conditions. Each party’s obligations to effect the Merger and otherwise consummate the contemplated transactions thereunder are conditioned upon (i) the effectiveness of the Registration Statement on Form S-4, (ii) expiration or termination of applicable regulatory waiting periods, (iii) no restraints from any governmental authority preventing the consummation of the contemplated transactions under the Merger Agreement, (iv) us and Open World obtaining the respective requisite stockholder votes to consummate the transactions contemplated by the Merger Agreement, (v) us causing our PeriShip subsidiary to terminate its current credit facility, (vi) us effectuating a reverse stock split upon the request of Open World, (vii) Nasdaq’s approval of our Nasdaq listing application for the post-Merger entity, (viii) receipt of written approval of the Merger by the Cayman Islands Trade and Business Licensing Board, and (ix) execution of the Registration Rights Agreement. Our and Merger Sub’s obligations to effect the Merger and otherwise consummate the contemplated transactions thereunder are further conditioned upon customary closing conditions. Open World’s obligations to effect the Merger and otherwise consummate the contemplated transactions thereunder are further conditioned upon customary closing conditions as well as (i) us having Closing Net Cash, as defined in the Merger Agreement, of no less than $1 million, and (ii) our common stock having not been delisted from Nasdaq.
Current report
In connection with and subject to the Closing of the Merger, outstanding time-based and performance-based restricted stock awards and restricted stock units held by certain of our employees and directors at Closing will accelerate and vest, regardless of any performance conditions, at the Effective Time.
Current report
At the Closing of the Merger, pursuant to the Merger Agreement, each of David Edmonds, Marshall Geller, Howard Goldberg, and Adam Stedham are expected to resign as directors of our Board of Directors.
Current report
The foregoing description of the Merger Agreement does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the full text of the Merger Agreement.
Current report
On April 15, 2026, we entered into the First Amendment to Agreement and Plan of Merger, effective April 13, 2026 (the “First Amendment”), with the Merger Sub and Open World, pursuant to which the outside date in the Merger Agreement, defined below, was extended from June 30, 2026 to August 31, 2026. The foregoing description of the First Amendment does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the full text of the First Amendment.
Current report
On September 24, 2025, we began offering ProActive services to the customers of an alternative Preferred Shipping Partner. We are currently establishing the ability to offer our Premium services to our Strategic Partner. We expect to begin broadly offering Premium and Direct Premium services to customers of our new Strategic Partner in the second quarter of 2026.
Current report
Revenue
Current report
Revenue decreased $2,683 thousand or 60% during the first quarter of 2026 compared to the first quarter of 2025. The decrease in revenue primarily relates to the termination of our agreement, effective September 24, 2025, with our prior carrier partner to offer our ProActive services.
Current report
Gross Profit
Current report
Management and Technology
Current report
Management and technology expenses decreased by $356 thousand to $570 thousand for the three months ended March 31, 2026, compared to $926 thousand for the three months ended March 31, 2025. The decrease primarily relates to lower amortization of intangible assets as a result of the previously reported asset impairment in the third quarter of 2025, and a decrease in wages from reduced headcount.
Current report
General and administrative expenses increased by $160 thousand to $1,016 thousand for the three months ended March 31, 2026, compared to $856 thousand for the three months ended March 31, 2025. The increase relates to legal expenses associated with the Company’s proposed merger with Open World, partially offset by a decrease in stock compensation and wages.
Current report
Interest Income, net
Current report
Cash used in operations was $711 thousand during the three months ended March 31, 2026, compared to $404 thousand during the three months ended March 31, 2025.
Current report
Cash used in investing activities was $109 thousand during the three months ended March 31, 2026, compared to $156 thousand during the three months ended March 31, 2026.
Current report
On August 25, 2023, the Company entered into a Convertible Note Purchase Agreement with certain investors for the sale of convertible promissory notes for the aggregate principal amount of $1,100 thousand of which $475 thousand was purchased by related parties including certain members of management and the Board of Directors. As of December 31, 2025, $400 thousand was held by related parties. The notes are subordinated unsecured obligations of the Company and accrue interest at a rate of 8% per year payable semiannually in arrears on February 25 and August 25 of each year, beginning on February 25, 2024. The notes will mature on August 25, 2026, unless earlier converted or repurchased at a conversion price of $1.15 per share of common stock. The Company may not redeem the notes prior to the maturity date. For the year ended December 31, 2025, interest expense related to the convertible debt was $61 thousand. As of January 21, 2025, $350 thousand was converted to common stock, none of which was related parties. As of March 31, 2026, the amount outstanding on the convertible debt was $750 thousand and included in Convertible note and Convertible note related party on the accompanying Consolidated Balance Sheets.
Current report
In connection with the Merger Agreement we have agreed that PeriShip Global will not utilize the PNC Facility or RLOC from the execution of the Merger Agreement. Additionally, we have agreed that at least three business days prior to closing of the merger to cause PeriShip Global to use its reasonable best efforts to obtain and deliver to Open World, a customary payoff letter with respect to the PNC Facility. As such, we do not expect to be able to utilize the PNC Facility or RLOC unless the merger is not completed pursuant to the terms of the merger agreement.
Current report
We believe that our cash and cash equivalents, together with the proceeds from the warrant inducement and loan agreement, will fund our operations for the next 12 months including expected capital expenditures.
Current report
Revenue Recognition
Current report
We recognize revenue based on the principals established in the Financial Accounting Standards Board Accounting Standard Codification (“ASC”) Topic 606,Revenue from Contracts with Customers. The timing of revenue recognition, billings and cash collections results in unbilled revenue (contract assets) and deferred revenue (contract liabilities) on the consolidated balance sheets. Amounts charged to our clients become billable according to the contract terms, which usually consider the delivery completion. Unbilled amounts will generally be billed and collected within 30 days but typically no longer than 60 days. When we advance bill clients prior to the work being performed, generally, such amounts will be earned and recognized in revenue within twelve months. These assets and liabilities are reported on the consolidated balance sheets on a contract-by-contract basis at the end of each reporting period. Changes in the contract asset and liability balances during the three-month period ended March 31, 2026, were not materially impacted by any other factors.
Current report
Applying the practical expedient in ASC Topic 606, we recognize the incremental costs of obtaining contracts (sales commissions) as an expense when incurred if the amortization period of the assets that we otherwise would have recognized is one year or less. As of March 31, 2026, we did not have any capitalized sales commissions.
Removed paragraphs (51)
Previous report
Authentication: The Authentication segment specializes in anti-counterfeit and brand protection. This is critical in the current landscape of increased counterfeit activity and customer expectations
Previous report
On July 29, 2025, PeriShip Global entered into (i) a Digital Channel Program Agreement (the “Program Agreement”) and (ii) a Partner API Access Agreement (the “Integration Agreement” and together with the Program Agreement, the “Agreements”) with an alternative Preferred Shipping Partner (“Partner”). The Agreements provide PeriShip Global access to designated Partner services at promotional rates as part of a specialized logistics management services for time-sensitive and perishable shipments, including proactive monitoring, weather tracking, and issue resolution through certain digital channel program applications. Pursuant to the Integration Agreement, PeriShip Global will be permitted to develop Interfaces to certain Partner APIs, Access Services and Information (as such terms are defined in the Integration Agreement). The Agreements have a term of three years, subject to customary termination and renewal provisions.
Previous report
Our Authentication segment has a contract with HP Indigo. We believe this partnership can be used to enable brand owners to securely prevent counterfeiting.
Previous report
FedEx
Previous report
On August 26, 2025, the FedEx Corporation notified providers, including PeriShip Global, that it would be providing preferred shipping services internally and that the providers would no longer be approved FedEx preferred shippers effective September 24, 2025. As such, PeriShip Global is no longer a FedEx preferred shipper and our Precision Logistics segment can no longer offer our Proactive services to FedEx customers. We continue to provide our Premium services to FedEx customers. As a result of this change, it is likely that our revenues from Proactive services will materially decline in the quarters ended December 31, 2025 and March 31, 2026 as compared to the quarters ended December 31, 2024 and March 31, 2025. We expect our Proactive services revenues to substantially recover during 2026 as we transition additional customers and increase our existing and new customer bases.
Previous report
Partner Agreements
Previous report
On July 29, 2025, PeriShip Global entered into a Program Agreement, and an Integration Agreement with an alternative Preferred Shipping Partner (“Partner”). The Agreements provide PeriShip Global access to designated Partner services at promotional rates as part of a specialized logistics management services for time-sensitive and perishable shipments, including proactive monitoring, weather tracking, and issue resolution through certain digital channel program applications. Pursuant to the Integration Agreement, PeriShip Global will be permitted to develop Interfaces to certain Partner APIs, Access Services and Information (as such terms are defined in the Integration Agreement). The Agreements have a term of three years, subject to customary termination and renewal provisions.
Previous report
ZenCredit Agreement
Previous report
Nasdaq Deficiency Notice
Previous report
Consolidated revenue decreased $402 thousand or 7% during the third quarter of 2025 compared to the third quarter of 2024. The decrease is primarily due to a $767 thousand decrease related to discontinued services with two customers in our Proactive services, partially offset by increased revenues from new and existing customers in the Precision Logistics segment. The decrease in revenue in our Authentication segment is primarily due to the divestiture of our Trust Codes Global business in December 2024.
Previous report
Segment Management and Technology
Previous report
Segment management and technology expenses decreased by $585 thousand to $744 thousand for the three months ended September 30, 2025, compared to $1,329 thousand for the three months ended September 30, 2024. The decrease relates primarily to the divestiture of Trust Codes Global in December 2024, a decrease in management wages and stock compensation expense, and the capitalization of development expense related to internally used software in our Precision Logistics segment.
Previous report
General and administrative expenses decreased by $109 thousand to $669 thousand for the three months ended September 30, 2025, compared to $778 thousand for the three months ended September 30, 2024. The decrease relates primarily to a decrease in stock-based compensation and management wages.
Previous report
Goodwill and Intangible Asset Impairment
Previous report
As a result of a long-lived asset and goodwill asset impairment assessments performed in the third quarter of 2025, an intangible asset impairment charge of $2,788 thousand and a goodwill impairment charge of $1,062 thousand was recorded for the three months ended September 30, 2025 relating to the Precision Logistics segment. An intangible asset impairment charge of $901 thousand and a goodwill impairment charge of $1,351 thousand was recorded for the three months ended September 30, 2024 relating to Authentication segment.
Previous report
Interest Income(Expense), net
Previous report
Comparison of the Nine months ended September 30, 2025, and 2024
Previous report
Consolidated revenue decreased $2,538 thousand for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The decrease is primarily due to the decreased demand across several of our Proactive services customers, one customer’s shift to use their cold chain strategy, and a discontinued contract with one customer in our Premium services. The decrease in revenue in our Authentication segment is primarily due to the divestiture of our Trust Codes Global business in December 2024.
Previous report
Gross profit for the nine months ended September 30, 2025, was $5,154 thousand, compared to $6,245 thousand for the nine months ended September 30, 2024. The resulting gross margin was 37% for the nine months ended September 30, 2025, compared to 38% for the nine months ended September 30, 2024. The gross profit decrease relates to the decrease in Premium services revenue which has higher margins than Proactive services, and the decrease in Authentication revenue from the divestiture of our Trust Codes Global business in December 2024. Our Proactive services gross margin percentage improved in 2025 compared to 2024.
Previous report
Segment Management and Technology
Previous report
Segment management and technology expenses decreased by $1,599 thousand to $2,590 thousand for the nine months ended September 30, 2025, compared to $4,189 thousand for the nine months ended September 30, 2024. The decrease relates primarily to the divestiture of Trust Codes Global in December 2024 and gain on derecognized liability in our Authentication segment and a decrease in management wages and severance expense in our Precision Logistics segment.
Previous report
General and Administrative Expenses
Previous report
General and administrative expenses decreased by $539 thousand to $2,241 thousand for the nine months ended September 30, 2025, compared to $2,780 thousand for the nine months ended September 30, 2024. The decrease relates primarily to a decrease in stock-based compensation from $1,055 thousand for the nine months ended September 30, 2024 to $465 thousand for the nine months ended September 30, 2025.
Previous report
Research and Development
Previous report
Research and development expenses were $15 thousand and $65 thousand for the nine months ended September 30, 2025, and 2024, respectively.
Previous report
Sales and Marketing
Previous report
Sales and marketing expenses decreased by $194 thousand to $805 thousand for the nine months ended September 30, 2025, compared to $999 thousand for the nine months ended September 30, 2024. The decrease is primarily related to a reduction in employees and consultants in our Precision Logistics and Authentication segments.
Previous report
Goodwill and Intangible Asset Impairment
Previous report
As a result of a long-lived asset and goodwill asset impairment assessment performed in the third quarter of 2025, an intangible asset impairment charge of $2,788 thousand and a goodwill impairment charge of $1,062 thousand was recorded for the nine months ended September 30, 2025 relating to the Precision Logistics segment. An intangible asset impairment charge of $914 thousand and a goodwill impairment charge of $1,351 thousand was recorded for the nine months ended September 30, 2024 relating to Authentication segment.
Previous report
Interest Income (Expense), net
Previous report
Interest income was $121 thousand for the nine months ended September 30, 2025, compared to interest expense of $109 thousand for the nine months ended September 30, 2024. This increase in interest income primarily relates to the repayment of the Term Note in the first quarter of 2025 reducing interest expense as well as the increase in interest income from the Company’s investment of the proceeds from the warrants exercise in January 2025, and interest income earned on the Loan Agreement with ZenCredit entered on August 8, 2025.
Previous report
Net Loss
Previous report
Consolidated net loss for the nine months ended September 30, 2025, and 2024 was $4,218 thousand and $3,323 thousand, respectively. The increased loss relates primarily to the one time goodwill and intangible asset impairment, noted above, and the gain on change in fair value of the contingent consideration related to the acquisition of Trust Codes Global for the nine months ended September 30, 2024 that did not recur in the nine months ended September 30, 2025. The resulting consolidated loss per share for the nine months ended September 30, 2025, and nine months ended September 30, 2024, was $0.34 and $0.32 per basic and diluted share, respectively.
Previous report
Our operations provided $549 thousand of cash during the nine months ended September 30, 2025, compared to $302 thousand during the comparable period in 2024.
Previous report
Cash used by investing activities was $2,566 thousand during the nine months ended September 30, 2025, compared to $353 thousand during the nine months ended September 30, 2024. The increase in spending in investing activities relates primarily to a Promissory Note of $2 million with ZenCredit entered into on August 8, 2025 and increased capitalized software costs in the nine months ended September 30, 2025.
Previous report
On March 6, 2025, the Company entered into an ATM with Roth pursuant to which the Company may issue and sell, from time to time, shares of its common stock up to an aggregate offering price of $15.8 million. Roth acts as the sales agent and is entitled to a 3.0% commission on gross proceeds from sales under the program.
Previous report
In connection with the ATM, we incurred direct legal and audit fees totaling $150 thousand. These costs have been recorded as deferred offering costs within other current assets and will be reclassified to additional paid-in capital and amortized over a period of one year once shares are issued. Deferred offering costs will be assessed for recoverability at each reporting period. If management determines that the ATM program is not probable to be utilized, the deferred costs will be expensed to general and administrative expenses.
Previous report
During the nine months ended September 30, 2025, and as of the date of this filing, we have not sold any shares of common stock through the ATM.
Previous report
We believe that our cash and cash equivalents will fund our operations beyond the next 12 months. We may issue additional debt or equity as we grow our business which we expect to grow organically, and if the opportunity arises, through key acquisitions that will help accelerate the growth of our business.
Showing the first 40 of 51 passages. Open the source sections for the rest.
Reworded paragraphs (16)
Previous wording
VerifyMe, Inc. (“VerifyMe,” the “Company,” “we,” “us,” or “our”), is a logistics company that specializes in time and temperature sensitive products, as well as providing brand protection and enhancement solutions. We operate a Precision Logistics segment which includes the operations of our subsidiary PeriShip Global and accounts for nearly all VerifyMe revenue, and an Authentication segment. Through our Precision Logistics segment, we provide a value-added service for sensitive parcel management driven by a proprietary software platform that provides predictive analytics from key metrics such as pre-shipment weather analysis, flight-tracking, sort volumes, and traffic, delivered to customers via a secure portal. The portal provides real-time visibility into shipment transit and last-mile events which is supported by a service center. Through our Authentication segment our technologies enable brand owners to deter counterfeit and diversion activities. Further information regarding our business segments is discussed below:
Current wording
VerifyMe, Inc. (“VerifyMe,” the “Company,” “we,” “us,” or “our”), is a logistics company that specializes in time and temperature sensitive products, as well as providing brand protection and enhancement solutions. Prior to 2026, we reported two operating segments: Precision Logistics and Authentication. We are not actively pursuing authentication business but continue servicing existing customers. As of January 1, 2026, the Authentication segment falls below segment reporting quantitative thresholds, and is therefore not required to be presented as a separate reportable segment. As a result, beginning in 2026, we changed our internal reporting to the chief operating decision maker who is our Chief Executive Officer, and combined Precision Logistics and Authentication into a single segment, leaving Precision Logistics. This represents a reduction in the number of reportable segments by aggregation, not a re-labeling. Through our Precision Logistics segment, we provide a value-added service for sensitive parcel management driven by a proprietary software platform that provides predictive analytics from key metrics such as pre-shipment weather analysis, flight-tracking, sort volumes, and traffic, delivered to customers via a secure portal. The portal provides real-time visibility into shipment transit and last-mile events which is supported by a service center.
Previous wording
**Precision Logistics:**The Precision Logistics segment specializes in predictive analytics for optimizing delivery of time and temperature sensitive perishable products. We manage complex industry-specific shipping logistic processes that require critical time, temperature control and handling to prevent spoilage and delayed delivery times and brand impairment. Utilizing predictive analytics from multiple data sources including flight-tracking, weather, traffic, major carrier feeds, and time of day data, we provide our clients an end-to-end vertical approach for their most critical service delivery needs. Using our proprietary IT platform, we provide real-time information and analysis to mitigate supply chain flow interruption, as well as delivering last-mile resolution for key markets, including the perishable healthcare and food industries.
Current wording
The Precision Logistics segment specializes in predictive analytics for optimizing delivery of time and temperature sensitive perishable products. We manage complex industry-specific shipping logistic processes that require critical time, temperature control, and handling to prevent spoilage and delayed delivery times and brand impairment. Utilizing predictive analytics from multiple data sources including flight-tracking, weather, traffic, major carrier feeds, and time of day data, we provide our clients an end-to-end vertical approach for their most critical service delivery needs. Using our proprietary IT platform, we provide real-time information and analysis to mitigate supply chain flow interruption, as well as delivering last-mile resolution for key markets, including the perishable healthcare and food industries.
Previous wording
On April 3, 2025, we received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based on the closing bid price of our common stock for 30 consecutive business days, we no longer meet Nasdaq Listing Rule 5550(a)(2), which requires listed companies to maintain a minimum bid price of at least $1 per share (the “Minimum Bid Price Rule”). The Nasdaq Listing Rules provide a compliance period of 180 calendar days, or until September 30, 2025, in which to regain compliance with the Minimum Bid Price Rule. On October 1, 2025, we received written notice from the Listing Qualifications staff of Nasdaq providing a second 180 calendar day compliance period, or until March 30, 2026, in which to regain compliance with the Minimum Bid Price Rule. On October 17, 2025, we received written notice from the Listing Qualifications staff of Nasdaq stating that for the last 10 consecutive business days, the closing bid price of our common stock has been at $1.00 per share or greater, and accordingly, we regained compliance with the minimum bid price requirements set forth in The Nasdaq Listing Rules for continued listing on the Nasdaq Capital Market. Nasdaq informed us in the compliance notice that it now considers this matter closed.
Current wording
On April 17, 2026, we received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based on the closing bid price of our common stock for 30 consecutive business days, we no longer meet Nasdaq Listing Rule 5550(a)(2), which requires listed companies to maintain a minimum bid price of at least $1 per share (the “Minimum Bid Price Rule”). The Nasdaq Listing Rules provided us a compliance period of 180 calendar days, or until October 14, 2026, in which to regain compliance with the Minimum Bid Price Rule. See the “Risk Factors” section in this report.
Previous wording
Traditionally, most shipping businesses utilize the carrier’s data platform for tracking which generally informs the shipping enterprise, and their customers, when a package is in transit, when a package has been delivered, and some level of detail of the path which a package traveled. We believe taking the data feeds from a carrier and adding real-time visibility with predictive analytics and the human intervention factor of our service center gives us a competitive advantage against other third-party platforms that solely rely on the carrier’s data feeds. We utilize a variety of input sources beyond the carrier’s data feed. Our proprietary “Predictive Analytics” technology is fed real-time meteorology data, traffic and road construction data, and power grid information to help predict issues before they happen. If an alert is created the shipper and our service center will work to address the issue and save the perishable product from spoiling, saving the shipper significant costs and reducing the need to replace products that are no longer viable. We have meteorologists on staff that track world-wide weather patterns to address predicted issues before they happen. We believe the company has two significant areas of opportunity. First, our services are specifically designed to address the needs of small and medium size agriculture, food and beverage companies. Second, the pharmaceutical and healthcare industries represent significant opportunities due to the enhanced tracking and customer service associated with distribution of these products. We are focusing our sales emphasis on those industries.
Current wording
Traditionally, most shipping businesses utilize the carrier’s data platform for tracking which generally informs the shipping enterprise, and their customers, when a package is in transit, when a package has been delivered, and some level of detail of the path which a package traveled. We believe taking the data feeds from a carrier and adding real-time visibility with predictive analytics and the human intervention factor of our service center agents give us a competitive advantage against other third-party platforms that solely rely on the carrier’s data feeds. We utilize a variety of input sources beyond the carrier’s data feed. Our proprietary “Predictive Analytics” technology is fed real-time meteorology data, traffic and road construction data, and power grid information to help predict issues before they happen. If an alert is created the shipper and our service center agents work to address the issue saving the perishable product from spoiling, while saving the shipper significant costs and reducing the need to replace products that are no longer viable. We have meteorologists on staff that track world-wide weather patterns to address predicted issues before they happen. We believe the company has two significant areas of opportunity. First, our services are specifically designed to address the needs of small and medium-sized health care, agriculture, food and beverage companies. Second, the pharmaceutical and healthcare industries represent significant opportunities due to the enhanced tracking and customer service associated with distribution of these products. We are focusing our sales emphasis on those industries and discovering other industries that need a “high touch”, “white glove” exception management team.
Previous wording
On August 26, 2025, FedEx Corporation notified providers, including PeriShip Global, that it would be providing preferred shipping services internally and that the providers would no longer be approved FedEx preferred shippers effective September 24, 2025. As such, PeriShip Global is no longer a FedEx preferred shipper and our Precision Logistics segment can no longer offer our Proactive services to FedEx customers. We continue to provide our Premium services to FedEx customers. On September 24, 2025, we began offering Proactive services to the customers of an alternative Preferred Shipping Partner.
Current wording
On August 26, 2025, our prior carrier partner, notified providers, including PeriShip Global, that it would be providing preferred shipping services through its own internal platform and that the providers would no longer be approved as preferred shippers effective September 24, 2025. As such, PeriShip Global is no longer a preferred shipper for our prior carrier partner and our Precision Logistics segment ceased providing ProActive services to our prior carrier partner’s customers in September 2025. We continued to provide Premium services to our prior carrier partner until we ceased providing Premium services in February 2026. While we no longer provide ProActive and Premium services to our prior carrier partner, we continue to provide Direct Premium services to our customers who use our prior carrier partner for their shipping needs.
Previous wording
In response to market conditions and lower demand some carriers have implemented strategies to address a potential global recession. We have seen a softening in demand for some services related to high-end perishable items which seem to be impacted by reduced discretionary spending by U.S. consumers. While a recession, whether global or more localized to the U.S., may decrease the demand for our services that are more discretionary in nature, we believe that the internal cost cutting measures, if implemented by carriers, may benefit out-sourced service providers. Additionally, the U.S. presidential administration has imposed tariffs on goods imported into the U.S. In response, several foreign governments have imposed new tariffs on certain goods imported from the U.S. and additional retaliatory measures against U.S. goods are expected. These or additional changes in U.S. or international trade policy, along with continued uncertainty surrounding such policies, could lead to further weakened business conditions. We can provide no assurances that a decline in discretionary consumer spending will not have a negative impact on our revenues and results of operations.
Current wording
We have seen a softening in demand for some services related to high-end perishable items which seem to be impacted by reduced discretionary spending by U.S. consumers. In response to uncertainty in the global market and lower demand some carriers have implemented strategies to address a potential global recession. Additional changes in U.S. or international trade policy, along with continued uncertainty surrounding such policies, could lead to further weakened business conditions. Additionally, inflation and uncertainty and instability in the global economy and geopolitical events such as a war in Iran and unrest in areas of the world that are dependent upon fuel production can negatively affect transportation costs and further reduce consumer spending leading to fewer goods being transported globally. We can provide no assurances that a decline in discretionary consumer spending for these or any reasons will not have a negative impact on our revenues and results of operations.
Previous wording
We experience seasonal fluctuations in our net revenues from sales in our Precision Logistics segment. Revenues from sales are generally higher in the fourth quarter than in other quarters due to increased holiday shipments. While the fourth quarter is historically our highest revenue quarter, we expect revenues from Proactive services to decline in the quarter ended December 31, 2025 as compared to the quarter ended December 31, 2024 due to the previously disclosed loss of FedEx as a shipping supplier. The seasonality of our business may cause fluctuations in our quarterly operating results.
Current wording
We typically experience seasonal fluctuations in our net revenues from sales in our Precision Logistics segment. Revenues from sales are generally higher in the fourth quarter than in other quarters due to increased holiday shipments. While the fourth quarter is historically our highest revenue quarter, revenues from ProActive services declined in the quarter ended December 31, 2025 as compared to the quarter ended December 31, 2024 due to the previously disclosed loss of our prior carrier partner as a shipping supplier integrating our service offerings, and larger shippers not wanting to change shipping suppliers during the peak season. We anticipate that the historical seasonality trends of the business will return in 2026.The seasonality of our business may cause fluctuations in our quarterly operating results.
Previous wording
Gross profit for the three months ended September 30, 2025, was $2,073 thousand, compared to $1,895 thousand for the three months ended September 30, 2024. The resulting gross margin was 41% for the three months ended September 30, 2025, compared to 35% for the three months ended September 30, 2024. The gross profit increase relates primarily to decreased costs related to our Proactive services.
Current wording
Gross profit for the three months ended March 31, 2026, was $960 thousand, compared to $1,490 thousand for the three months ended March 31, 2025. The resulting gross margin was 54% for the three months ended March 31, 2026, compared to 33% for the three months ended March 31, 2025. The gross profit percentage increase relates to the mix of ProActive and Premium services provided during the quarter, and process improvements implemented to increase ProActive services margins.
Previous wording
Research and development expenses were $5 thousand for the three months ended September 30, 2025, and 2024, respectively.
Current wording
Research and development expenses were $0 and $5 thousand for the three months ended March 31, 2026 and March 31, 2025, respectively.
Previous wording
Sales and marketing expenses decreased by $164 thousand to $237 thousand for the three months ended September 30, 2025, compared to $401 thousand for the three months ended September 30, 2024. This improvement was primarily due to a decrease in headcount and travel expense in the Precision Logistics and Authentication segments.
Current wording
Sales and marketing expenses decreased by $155 thousand to $141 thousand for the three months ended March 31, 2026, compared to $296 thousand for the three months ended March 31, 2025. The decrease primarily relates to a decrease in headcount.
Previous wording
Interest income, net was $67 thousand for the three months ended September 30, 2025, compared to interest expense, net of $29 thousand for the three months ended September 30, 2024. This increase primarily relates to a reduction of interest expense resulting from the repayment of the Term Note in the first quarter of 2025, an increase in interest income from the Company’s investment of proceeds from the warrants exercise in January 2025, and interest income earned on the promissory note with ZenCredit entered on August 8, 2025.
Current wording
Interest income, net was $88 thousand for the three months ended March 31, 2026, compared to $22 thousand for the three months ended March 31, 2025. This increase primarily relates to a reduction of interest expense resulting from the repayment of the Term Note in the first quarter of 2025, offset by interest income earned on the promissory note with ZenCredit entered on August 8, 2025.
Previous wording
Consolidated net loss for the three months ended September 30, 2025, and 2024 was $3,356 thousand and $2,424 thousand, respectively. The increased loss relates primarily to the one time goodwill and intangible asset impairment, noted above, and the gain on change in fair value of the contingent consideration related to the acquisition of Trust Codes Global for the three months ended September 30, 2024 that did not recur in the three months ended September 30, 2025. The resulting consolidated loss per share for the three months ended September 30, 2025, and three months ended September 30, 2024, was $0.26 and $0.23 per basic and diluted share, respectively.** **
Current wording
Net loss for the three months ended March 31, 2026 and 2025 was $679 thousand and $571 thousand, respectively. The increased loss primarily relates to the decrease in revenues resulting from the previously disclosed loss of the Company’s former carrier partner. The resulting consolidated loss per share for the three months ended March 31, 2026, and three months ended March 31, 2025, was $0.05 and $0.05 per basic and diluted share, respectively.** **
Previous wording
Cash provided by financing activities during the nine months ended September 30, 2025, was $3,201 thousand compared to cash used in financing activities during the nine months ended September 30, 2024 of $438 thousand. The increased cash primarily relates to proceeds from the exercise of warrants, partially offset by the repurchase of shares under the repurchase program and repayment of the Term Note during the nine months ended September 30, 2025.
Current wording
Cash used in financing activities during the three months ended March 31, 2026, was $14 thousand, compared to cash provided by financing activities during the three months ended March 31, 2025, of $3,444 thousand. The decrease primarily relates to one-time proceeds received from the exercise of warrants during the three months ended March 31, 2025.
Previous wording
On August 8, 2025, we entered into the Loan Agreement with ZenCredit. Pursuant to the Loan Agreement, we agreed to loan ZenCredit up to $2 million and on August 11, 2025 we loaned ZenCredit $2 million in exchange for a promissory note issued pursuant to the Loan Agreement. Pursuant to the terms of the Loan Agreement, ZenCredit will pay us regular quarterly interest payments at an annual interest rate of 16%. The term of the initial promissory note is nine months at which time all accrued principal and interest is due to us unless we elect to make an Additional Loan (as such term is defined in the Loan Agreement) subject to the terms of the Loan Agreement. As of September 30, 2025, we reserved $12 thousand allowance for expected credit loss on the Note.
Current wording
On August 8, 2025, we entered into the Loan Agreement with ZenCredit. Pursuant to the Loan Agreement, we agreed to loan ZenCredit up to $2 million and on August 11, 2025 we loaned ZenCredit $2 million in exchange for a promissory note issued pursuant to the Loan Agreement that matures on May 11, 2026. Pursuant to the terms of the Loan Agreement, ZenCredit will pay us regular quarterly interest payments at an annual interest rate of 16%. The term of the initial promissory note is nine months at which time all accrued principal and interest is due to us subject to the terms of the Loan Agreement. As of March 31, 2026, we reserved $12 thousand allowance for expected credit loss on the Note.
Previous wording
On September 22, 2022, we entered into the PNC Facility with PNC Bank, National Association. The PNC Facility includes a $1 million RLOC. The RLOC has no scheduled payments of principal until maturity, and bears interest per annum at a rate equal to the sum of Daily SOFR plus 2.85% with monthly interest payments. The RLOC is guaranteed by the Company and secured by the assets of PeriShip Global and the Company. As of September 30, 2025, $0 was outstanding on the RLOC. On August 8, 2025, the Company extended the line of credit to September 30, 2026.
Current wording
On September 22, 2022, we entered into the PNC Facility with PNC Bank, National Association. The PNC Facility includes a $1 million RLOC. The RLOC has no scheduled payments of principal until maturity, and bears interest per annum at a rate equal to the sum of Daily SOFR plus 2.85% with monthly interest payments. The RLOC is guaranteed by the Company and secured by the assets of PeriShip Global and the Company. On August 8, 2025, the Company extended the line of credit to September 30, 2026. As of March 31, 2026, $0 was outstanding on the RLOC.
Previous wording
Our financial statements are impacted by the accounting policies used and the estimates and assumptions made by management during their preparation. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows and which require the application of significant judgment by management. We believe estimates and assumptions related to these critical accounting policies are appropriate under the circumstances; however, should future events or occurrences result in unanticipated consequences, there could be a material impact on our future financial position, results of operations or cash flows.
Current wording
We have identified below the critical accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows and which require the application of significant judgment by management. We believe estimates and assumptions related to these accounting policies are appropriate under the circumstances; however, should future events or occurrences result in unanticipated consequences, there could be a material impact on our future financial position, results of operations or cash flows.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Our financial statements are impacted by the accounting policies used and the estimates and assumptions made by management during their preparation. Management has determined that there are no critical accounting estimates that require disclosure.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
On August 8, 2025, we entered into a Master Loan Agreement and Promissory Note (the “Loan Agreement”) with ZenCredit Ventures, LLC (“ZenCredit”). Pursuant to the Loan Agreement, we agreed to loan ZenCredit up to $2 million. Pursuant to the terms of the Loan Agreement, ZenCredit will pay us regular quarterly interest payments at an annual interest rate of 16%. The term of the initial promissory note is nine months at which time all accrued principal and interest is due to us unless we elect to make an Additional Loan (as such term is defined in the Loan Agreement) subject to the terms of the Loan Agreement. On August 11, 2025, we loaned ZenCredit $2 million in exchange for a promissory note issued pursuant to the Loan Agreement.
Previous report — wording carried elsewhere
The following discussion analyzes our results of operations for the nine months ended September 30, 2025, and 2024.