GRDX

RISK FACTORS We are subject to numerous risks and uncertainties that could materially adversely affect our business, financial condition, results of operations and the value of our securities.
The risks described below are not the only risks we face.
Additional risks and uncertainties not presently known to us, or that we currently consider immaterial, may also materially adversely affect us.
If any of the following risks occur, our business, financial condition, results of operations and prospects could be materially harmed, and the trading price of our Common Stock could decline, potentially causing investors to lose all or part of their investment.
Summary of Risk Factors An investment in our securities involves a high degree of risk.
The principal risks relating to our business and securities include the following: ● Our current dependency on external funding for our operations raises a substantial doubt about our ability to continue as a going concern. ● Our level of indebtedness and our ability to make payments on or service our indebtedness could adversely affect our business, financial condition, results of operations, cash flow and liquidity. ● We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed and on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product candidate development programs, testing efforts or other operations. ● Additional offerings in the future may dilute then existing stockholders’ percentage ownership of our Company. ● We experienced significant board and management turnover during the fourth quarter of 2025, and instability in governance and leadership could adversely affect our business. ● We are a clinical stage biopharmaceutical company and have a limited operating history upon which to base an investment decision. ● We will face intense competition and may not be able to compete successfully. ● We may incur substantial product liability or indemnification claims relating to the use of our product candidates. ● We may use biological materials and may use hazardous materials, and any claims relating to improper handling, storage or disposal of these materials could be time consuming or costly. ● We will need to grow the size of our organization, and we may experience difficulties in managing this growth. ● Disruptions in the global economy and supply chains may have a material adverse effect on our business, financial condition and results of operations. ● Adverse global conditions, including economic uncertainty, may negatively impact our financial results. ● Significant disruptions of information technology systems or breaches of data security could materially adversely affect our business, results of operations and financial condition. ● Requirements associated with being a public company will increase our costs significantly and will divert significant company resources and management attention. ● We operate as a clinical stage biopharmaceutical company with relation to our retained biopharmaceutical assets but have a limited operating history upon which to base an investment decision. -20- ● Our product candidates are at an early stage of development and may not be successfully developed or commercialized. ● Any product candidates we advance into and through clinical development are subject to extensive regulation, which can be costly and time consuming, cause unanticipated delays or prevent the receipt of the required approvals to commercialize our product candidates. ● If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected. ● Because the results of preclinical studies and early clinical trials are not necessarily predictive of future results, any product candidate we advance into clinical trials may not have favorable results in later clinical trials, if any, or receive regulatory approval. ● Any product candidate we advance into and through clinical trials may cause unacceptable adverse events or have other properties that may delay or prevent their regulatory approval, limit the commercial profile of the approved labeling, or result in significant negative consequences following marketing approval, if any. ● Delays in the commencement or completion of our clinical trials could result in increased costs and delay our ability to pursue regulatory approval and commercialization of our product candidates. ● We may be required to suspend, repeat or terminate our clinical trials if they are not conducted in accordance with regulatory requirements, the results are negative or inconclusive or the trials are not well designed. ● The approval processes of regulatory authorities are lengthy, time consuming, expensive and inherently unpredictable. ● If we are unable to execute our sales and marketing strategy for our products and are unable to gain market acceptance, we may be unable to generate sufficient revenue to sustain our business. ● We are an early-stage operating company in our GridAI business with a limited operating history, and our ability to execute our business plan depends on successful customer deployments, integration with third-party systems, and scaling of our platform and personnel. ● Our near-term revenue from our GridAI business may depend on a limited number of customers, projects, or counterparties, and the loss, delay, or failure to convert pilot programs or letters of intent into long-term commercial agreements could materially adversely affect our financial condition and results of operations. ● Our GridAI platform depends on interoperability with third-party hardware, software, and energy market systems, and disruptions or limitations in such third-party systems could impair our ability to deliver services. ● Our GridAI platform relies on data inputs, forecasting models, and optimization algorithms that may be subject to error or incomplete information, and actual performance may differ from expected results, which could adversely affect customer relationships and our reputation. ● The markets in which our GridAI business operates are highly competitive, and we face competition from established energy, software, and industrial companies with greater resources, which could adversely affect our ability to grow and maintain market share. ● Our GridAI business operates in complex and evolving regulatory environments, including energy markets and infrastructure regulations, and changes in such regulations could adversely affect our business and the value of our solutions. ● Our ability to successfully commercialize our GridAI platform depends on continued adoption of artificial intelligence and energy optimization technologies, which are rapidly evolving and inherently uncertain. -21- ● We may require additional capital to fund the development and growth of our GridAI business, and there can be no assurance that such capital will be available on acceptable terms, or at all. ● Any failure of our information technology systems or those of third parties, or any cybersecurity incident, could materially adversely affect our GridAI operations, customer relationships, and reputation. ● If we accept digital assets, including stablecoins, as consideration in our transactions, we may be subject to volatility, regulatory uncertainty and accounting complexity, which could adversely affect our financial results and operations.
On December 31, 2025, we had cash and cash equivalents of approximately $0.9 million, and an accumulated deficit of approximately $208.8 million.
Based on cash on hand at December 31, 2025 and the available loan proceeds and assuming successful financing efforts, which we cannot guarantee, we anticipate having sufficient cash to fund planned operations for the next several months.
Although our business changed significantly during 2025 through the acquisition of Grid AI Corp. and the completion of the ImmunogenX rescission transaction, we are dependent on obtaining additional working capital funding from the sale of equity and/or debt securities in order to continue to execute our development plans and continue operations.
Any failure in these efforts could force us to delay, limit or terminate operations, make reductions in our workforce, discontinue research and development programs, liquidate all or a portion of assets or pursue other strategic alternatives, and/or seek protection under the provisions of the U.S.
As of April 1, 2026, the Company was in default under the -22- Revolving Loan Agreement as a result of its failure to repay amounts due at maturity, and the lender has issued a demand for repayment of the outstanding amounts.
We expect our expenses to increase in connection with our ongoing activities, including with connection to the operating of Grid AI Corp. and AMPX.
Our operating plans and other demands on our cash resources may change as a result of many factors, including costs required to advance Adrulipase, the pace of commercialization and development of the Grid AI Corp. and AMPX platform, as well as factors currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity or debt financings or other capital sources, including potentially government funding, collaborations, licenses and other similar arrangements.
Attempting to secure additional financing may divert our management from its day-to-day activities, which may adversely affect our ability to develop our product candidates.
Our future capital requirements will depend on many factors, including: ● the costs and timing of manufacturing for our product candidates; ● the costs associated with hiring additional personnel and consultants as our research and development activities increase; ● operating and integrating the Grid AI Corp. and AMPX business and ● the terms and timing of establishing and maintaining collaborations, licenses and other similar arrangements.
In particular, the September 30, 2025 Grid AI Corp. transaction included the issuance of Series H Non-Voting Convertible Preferred Stock that is convertible, subject to conditions, into a substantial number of shares of Common Stock.
We also have outstanding warrants and other equity-linked instruments, and we granted equity awards to management and directors in late 2025 and early 2026. -23- These instruments may significantly dilute existing stockholders, both economically and voting-wise, if converted, exercised or settled in shares.
We experienced significant board and management turnover during the fourth quarter of 2025, and instability in governance and leadership could adversely affect our business.
In late 2025, we underwent significant governance and leadership changes, including board resignations, changes in board composition, a new Chief Executive Officer arrangement, a new Interim Chief Financial Officer and new equity awards to management and directors.
One director resignation was accompanied by stated disagreements regarding governance, diligence and disclosure matters.
These events could adversely affect us by: ● disrupting strategic execution ● weakening internal controls or disclosure controls ● diverting management attention ● increasing legal, accounting and administrative burden ● impairing our ability to recruit, retain and motivate qualified personnel ● damaging confidence among investors, business partners, regulators, auditors and other stakeholders.
If we are unable to maintain stable and effective leadership, our business and reporting quality may be adversely affected.
Our operations are subject to risks arising from global economic conditions, supply chain disruptions and volatility in energy markets.
These risks may affect the availability, cost and timing of components, infrastructure and third-party services required to support the development and deployment of our energy orchestration platform and related technologies.
Global supply chains have experienced significant disruption in recent years, and ongoing geopolitical conflicts, trade tensions, inflationary pressures and macroeconomic uncertainty continue to impact market conditions.
In particular, disruptions affecting the energy sector, data center infrastructure and related equipment could adversely affect our ability to scale our platform, deliver services to customers and execute our business strategy.
In addition, inflationary pressures and volatility in labor, technology and infrastructure costs may increase our operating expenses and reduce our financial flexibility.
Any such disruptions or adverse developments could materially and adversely affect our business, financial condition and results of operations.
Adverse global conditions, including economic uncertainty, may negatively impact our financial results.
In addition, the global macroeconomic environment could be negatively affected by, among other things, pandemics or epidemics, instability in global economic markets, increased U.S. trade tariffs and trade disputes with other countries, instability in the -24- global credit markets, supply chain weaknesses, instability in the geopolitical environment as a result of the Russian invasion of Ukraine, conflicts in the Middle East, and foreign governmental debt concerns.
Acceptance of digital assets, including stablecoins, as consideration in our transactions may expose us to volatility, regulatory uncertainty and accounting complexity, which could adversely affect our financial results.
We are evaluating the planned acceptance of stablecoins and other digital assets as a form of consideration in certain future transactions.
The use of digital assets may expose us to risks, including potential fluctuations in value, even for assets intended to maintain a stable value, as well as risks related to cybersecurity, custody, and reliance on third-party platforms and infrastructure.
In addition, the regulatory environment for digital assets continues to evolve, and changes in laws, regulations, or interpretations by regulatory authorities could affect our ability to accept or use such assets or impose additional compliance obligations.
The accounting treatment of digital assets under U.S.
GAAP is complex and subject to interpretation.
Certain digital assets may be required to be measured at fair value with changes recognized in earnings, which could introduce volatility into our financial results.
Other digital assets may be accounted for as indefinite-lived intangible assets and subject to impairment testing, which could result in non-cash impairment charges.
Although we did not hold any digital assets as of December 31, 2025, if we elect to accept or hold such assets in the future, these risks could adversely affect our financial condition and results of operations.
Geopolitical risks associated with Russia’s invasion of Ukraine and conflicts in the Middle East, including the U.S. and Israel war with Iran, could result in increased market volatility and uncertainty, which could negatively impact our business, financial condition, and results of operations.

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Gone since FY2024

RISK FACTORS We are subject to various risks that could have a material adverse effect on our business, our financial condition and our results of operations.
These risks could cause actual operating results to differ from those expressed in certain “forward looking statements” contained in this Annual Report as well as in other communications.
Summary of Risk Factors ● Our current dependency on external funding for our operations raises a substantial doubt about our ability to continue as a going concern.
If we do not continue as a going concern, investors could lose their entire investment. ● Our level of indebtedness and our ability to make payments on or service our indebtedness could adversely affect our business, financial condition, results of operations, cash flow and liquidity. ● We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed and on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product candidate development programs, testing efforts or other operations, including. ● Future financings may dilute then existing shareholders’ percentage ownership of our company. ● If we do not consummate the transactions contemplated by the Rescission Agreement, we will remain responsible for approximately $9,278,400 of secured debt, and our level of indebtedness and our ability to make payments on or service our indebtedness could adversely affect our ability to implement our business plan as currently contemplated, and also adversely affect our financial condition, results of operations, cash flow and liquidity.
Defaults under this debt could result in a substantial loss of our assets.
We may also be required to settle conversion of our Series G Preferred Stock in cash. ● We do not expect to consummate certain previously disclosed transactions. ● We are a clinical stage biopharmaceutical company and have a limited operating history upon which to base an investment decision. ● We will face intense competition and may not be able to compete successfully. ● We may incur substantial product liability or indemnification claims relating to the use of our product candidates. ● Geopolitical risks associated with Russia’s invasion of Ukraine and Israel’s war with Hamas could result in increased market volatility and uncertainty, which could negatively impact our business, financial condition, and results of operations. -23- ● Significant disruptions of information technology systems or breaches of data security could materially adversely affect our business, results of operations and financial condition. ● Our product candidates are at an early stage of development and may not be successfully developed or commercialized. ● Any product candidates we advance into and through clinical development are subject to extensive regulation, which can be costly and time consuming, cause unanticipated delays or prevent the receipt of the required approvals to commercialize our product candidates. ● If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected. ● Because the results of preclinical studies and early clinical trials are not necessarily predictive of future results, any product candidate we advance into clinical trials may not have favorable results in later clinical trials, if any, or receive regulatory approval. ● We currently have no commercial organization.
If we are unable to establish satisfactory sales and marketing capabilities or secure a sales and marketing partner, we may not successfully commercialize any of our product candidates. ● If we breach our license or other intellectual property-related agreements for our product candidates or otherwise experience disruptions to our business relationships with our licensor, we could lose the ability to continue the development and commercialization of our product candidates. ● Our success will depend upon intellectual property, proprietary technologies and regulatory market exclusivity periods, and we may be unable to protect our intellectual property.
On December 31, 2024, we had cash and cash equivalents of approximately $0.2 million, and an accumulated deficit of approximately $202.4 million.
Subsequent to December 31, 2024, we closed on a revolving loan agreement in the principal amount of $2.0 million.
Based on cash on hand at December 31, 2024 and the available loan proceeds and assuming successful financing efforts, which we cannot guarantee, we anticipate having sufficient cash to fund planned operations through September 2025.
We are dependent on obtaining additional working capital funding from the sale of equity and/or debt securities in order to continue to execute our development plans and continue operations.
Any failure in these efforts could force us to delay, limit or -24- terminate operations, make reductions in our workforce, discontinue research and development programs, liquidate all or a portion of assets or pursue other strategic alternatives, and/or seek protection under the provisions of the U.S.
If an event of default occurs, the Lender may accelerate the indebtedness under the Revolving Loan Agreement, and an amount equal to 120% of the of the outstanding principal amount and accrued and unpaid interest plus liquidated damages and other amounts, costs, expenses and/or liquidated damages due.
We expect our expenses to increase in connection with our ongoing activities.
Our operating plans and other demands on our cash resources may change as a result of many factors, including costs required to advance Adrulipase, as well as factors currently unknown to us, and we may need to seek additional funds sooner than planned, through public or private equity or debt financings or other capital sources, including potentially government funding, collaborations, licenses and other similar arrangements.
Attempting to secure -25- additional financing may divert our management from its day-to-day activities, which may adversely affect our ability to develop our product candidates.
Our future capital requirements will depend on many factors, including: ● the costs and timing of manufacturing for our product candidates; ● the costs associated with hiring additional personnel and consultants as our research and development activities increase; ● the costs associated with advancing product candidates obtained through the Merger; and ● the terms and timing of establishing and maintaining collaborations, licenses and other similar arrangements.
We do not expect to consummate certain previously disclosed proposed transactions.
On December 27, 2023, we announced that we entered a non-binding term sheet to sell our Niclosamide program.
This transaction is not expected to move forward.
Development on the Niclosamide program is currently on hold due to capital constraints and we will continue to explore options to out license or sell this program.
There can be no assurance that any such out-licenses or sales will be consummated on terms favorable to us or at all.
Additionally, if we fail to consummate such out-licenses or sales, such failure could result in fluctuations to the market price of our Common Stock and may have a material adverse impact on our financial condition and results of operations.
If we do not consummate the transactions contemplated by the Rescission Agreement, we will remain responsible for approximately $9,278,400 of secured debt, and our level of indebtedness and our ability to make payments on or service our indebtedness could adversely affect our ability to implement our business plan as currently contemplated, and also adversely affect our financial condition, results of operations, cash flow and liquidity.
We may also be required to settle conversion of our Series G Preferred Stock in cash.
The Company expects that the closing of the Rescission Agreement will occur on or prior to June 30, 2025, subject to satisfaction of all conditions for closing, including obtaining shareholder approval by the Company for the transfer of the Membership Interests to the Shareholders.
We cannot guarantee that the closing will occur by June 30, 2025 or at all.
If the transactions contemplated by the Rescission Agreement are not consummated, we will remain responsible for an aggregate of approximately $9,278,400 of secured debt owed to Mattress Liquidators, Inc., our director Jack Syage, and to Peter Felker.
If we are not able to repay or refinance our debt as it becomes due, we will not be able to implement our business plan as currently contemplated and may be required to adopt one or more alternatives, such as selling assets, restructuring debt or obtaining additional debt or equity on terms that may be onerous or highly dilutive, if we can obtain it at all.
In addition, we may not be able to grow market share, take advantage of future opportunities or respond to competitive pressures or unanticipated requirements, which could negatively impact our business, operating results and financial condition. -26- These borrowings are secured by substantially all of the assets of IMGX and the patents and trademarks owned by IMGX.
If an event of default under any of such agreements could enable the lenders or creditors thereunder to declare all borrowings outstanding on such debt, together with accrued and unpaid interest and fees, to be due and payable.
The lenders could also elect to foreclose on our assets securing such debt.
In such an event, the Company may not be able to refinance or repay all of its indebtedness, have sufficient liquidity to meet operating and capital expenditure requirements, or hold the necessary intellectual property rights to conduct its business.
Any such acceleration could cause us to lose a substantial portion of our assets and will substantially adversely affect our ability to continue our operations.
Further, if the transactions contemplated by the Recission Agreement are not consummated, 11,777.418 shares of our Series G Preferred Stock will remain outstanding.
The holders of our outstanding shares of Series G Preferred Stock are entitled to elect to have such shares of Series G Preferred Stock redeemed for cash at a price per share equal to the then-current fair value of the Series G Preferred Stock, as described in the Certificate of Designation of Preferences, Rights and Limitations of the Series G Non-Voting Preferred Stock.
Unless we operate profitably, our ability to redeem the Series G Preferred Stock would require the availability of adequate “surplus,” which is defined as the excess, if any, of our net assets (total assets less total liabilities) over our capital.
If we do have sufficient “surplus” to effect any requested redemption of the Series G Preferred Stock, our available cash will be negatively impacted.
In addition, such reduction in our available cash could decrease the trading price of our Common Stock.
We are a clinical stage biopharmaceutical company and have a limited operating history upon which to base an investment decision.

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