As filed with the Securities and Exchange Commission on April 11, 2025

Registration No. 333-___________

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form S-4

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

BLACKBOXSTOCKS INC.

(Exact name of registrant as specified in its charter)

Blackboxstocks Inc.
5430 LBJ Freeway, Suite 1485
Dallas, Texas 75240
(972) 726-9203

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Gust Kepler
President and Chief Executive Officer
5430 LBJ Freeway, Suite 1485
Dallas, Texas 75240
(972) 726-9203

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this registration statement becomes effective and upon completion of the merger.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, 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, 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, a smaller reporting company, or 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. ☐

If applicable, place an ☒ in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) ☐

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ☐

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 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

PRELIMINARY — SUBJECT TO COMPLETION, DATED April 11, 2025

Joint Proxy And Consent Solicitation Statement/Prospectus

MERGER PROPOSED — YOUR VOTE IS VERY IMPORTANT

To the Stockholders of Blackboxstocks Inc. and REalloys Inc.:

On March 10, 2025, Blackboxstocks Inc., a Nevada corporation (“Blackboxstocks”), RABLBX Merger Sub, Inc., a Nevada corporation and a wholly owned subsidiary of Blackboxstocks (“Merger Sub”), and REalloys Inc. (“REalloys”), a Nevada corporation, entered into an Agreement and Plan of Merger (as may be amended from time to time, the “Merger Agreement”), which provides for, among other things, the merger of the Merger Sub with and into REalloys, with REalloys continuing as the surviving corporation (the “surviving corporation”) and a wholly owned subsidiary of Blackboxstocks (following the consummation of the Merger (as defined below) and the name change described below, the “Combined Company”), on the terms and conditions set forth in the Merger Agreement (the “Merger”). In connection with the consummation of the Merger, the Combined Company is expected to be renamed “REalloys Inc.” and the surviving corporation is expected to be named to “REalloys Solutions Inc.” The boards of directors of each of Blackboxstocks and REalloys have approved the Merger Agreement and the transactions contemplated by the Merger Agreement, including the Merger.

If the Merger is completed:

or (i) an aggregate of approximately [●] shares of Blackboxstocks common stock at closing, (ii) an aggregate of approximately [●] shares of Series C Preferred Stock at closing (which is subject to adjustment in the event the parties raise capital in excess of certain thresholds), (iii) warrants to purchase up to an aggregate of approximately [●] shares of Blackboxstocks common stock, based on an assumed price of $[●] per share, the closing price of the Blackboxstocks common stock on Nasdaq on [●], 2025, and (iv) an aggregate of approximately [●] shares of Blackboxstocks common stock as related to the REalloys SAFEs, based on an assumed price of $[●] per share, the closing price of the Blackboxstocks common stock on Nasdaq on [●], 2025.

Additionally, at the Effective Time, each warrant (the “REalloys Warrants”) issued pursuant to that certain securities purchase agreement, dated as of March 6, 2025, by and between REalloys and the investor named therein, that is outstanding and unexercised immediately prior to the Effective Time, will be converted into and become a warrant to purchase Blackboxstocks common stock), and Blackboxstocks shall assume the terms of the REalloys Warrants pursuant to the terms of the Merger Agreement and as further described herein.

Additionally, each holder of Blackboxstocks common stock of record as of immediately prior to the Effective Time shall be entitled to one contingent value right (“CVR”) for each share of Blackboxstocks common stock held by such holder, which shall be issued by Blackboxstocks pursuant to a Contingent Value Rights Agreement as contemplated by the Merger Agreement (the “CVR Agreement”). The CVRs will represent the rights to receive cash payments in connection with certain transactions involving the assets, rights and properties owned, used or usable by Blackbox.io Inc., a Nevada corporation and wholly owned subsidiary of Blackboxstocks (“Blackbox Operating”), which was organized to conduct historical operations of Blackboxstocks.

In addition, prior to the Effective Time: (i) Gust Kepler and Leonard Sternheim agreed to enter into a Securities Transfer Agreement, in a form acceptable to Gust Kepler and Leonard Sternheim, pursuant to which Gust Kepler will sell 1,634,999 shares of Series A Convertible Preferred Stock, par value $0.001 per share, of Blackboxstocks (the “Series A Preferred Stock”) to Leonard Sternheim (the “Preferred Transfer”), which sale shall be contingent upon and effective concurrently with Closing (the “Securities Transfer Agreement”) and (ii) Blackboxstocks and Gust Kepler will execute an option agreement (the “Option Agreement”) substantially in the form attached hereto as Annex G, pursuant to which Blackboxstocks shall have the right to call for redemption and Gust Kepler shall have the right to cause Company to redeem all of the remaining issued and outstanding Series A Preferred Stock, following such Preferred Transfer, held by Gust Kepler in exchange for shares of Series A Preferred Stock of Blackbox Operating.

Immediately upon completion of the Merger and the transactions contemplated in the Merger Agreement (i) REalloys stockholders will own approximately 92.7% of the fully diluted equity of the Combined Company and (ii) current Blackboxstocks stockholders, holders of certain outstanding options and warrants to purchase shares of Blackboxstocks common stock will own approximately 7.3% of the fully diluted equity of the Combined Company. Immediately following the Merger, subject to the approval of the current Blackboxstocks stockholders, it is anticipated that the combined company may need to effect a reverse stock split at a ratio between [●]-for-[●] and [●]-for-[●] with respect to its issued and outstanding common stock. The reverse stock split, if under taken, will be intended to result in an increase Blackboxstocks’ stock price to at least $4.00 per share and is expected to be undertaken if the parties deem it necessary to meet Nasdaq listing requirements.

Blackboxstocks’ common stock is currently listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “BLBX.” On March 7, 2025, the last full trading day before the announcement of the Merger, the last reported sale price of Blackboxstocks common stock was $3.46 per share, and on [●], 2025, the latest practicable date prior to the date of this joint proxy and consent solicitation statement/prospectus, the last reported sale price of Blackboxstocks’ common stock was $[●] per share. Blackboxstocks and REalloys urge you to obtain current market quotations for the price of Blackboxstocks’ common stock.

Each of Blackboxstocks and REalloys expects that the Merger will qualify as a “reorganization” or tax deferred contribution within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”).

Blackboxstocks will hold a special meeting of its stockholders (the “Special Meeting”), while REalloys will solicit its stockholders’ approval by written consent. Blackboxstocks stockholders will be asked to consider and vote upon the following proposals:

The Blackboxstocks Special Meeting will be held on [●], 2025 at [●] a.m., Central Time, and will be “virtual,” meaning that you can participate in the meeting online by visiting [●] at the appointed time and date and entering the control number included in your proxy card or voting instruction form. Blackboxstocks stockholders are encouraged to access the Special Meeting website before the start time. Please allow ample time for online check-in. Blackboxstocks stockholders will not be able to attend the special meeting in person.

REalloys stockholders will be asked to approve by written consent a proposal to adopt and approve the Merger Agreement and the transactions contemplated thereby, including the Merger (the “REalloys Merger Proposal”).

Completion of the Merger is conditioned upon satisfaction or waiver of all closing conditions under the Merger Agreement, including, among other things, (i) the approval by Blackboxstocks stockholders of: the Nasdaq Proposal, the Incentive Plan Proposal, the Reverse Stock Split Proposal, the Authorized Share Increase Proposal and the Adjournment Proposal, each of which requires the affirmative vote of the majority of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the subject matter and that are voted for or against the matter, and the Reverse Stock Split Proposal must also be approved by the holders of a majority of the issued and outstanding Blackboxstocks common stock, separately as a class, and (ii) the adoption and approval of the REalloys Merger Proposal by written consent of the holders of at least 50.1% of the outstanding shares of REalloys capital stock.

Blackboxstocks board of directors has determined that it is advisable and in the best interest of Blackboxstocks and its stockholders to enter into the Merger Agreement, and the Blackboxstocks board of directors has authorized and approved the terms of the Merger Agreement and the transactions contemplated thereby and recommends that Blackboxstocks stockholders vote “FOR” the Nasdaq Proposal, “FOR” the Incentive Plan Proposal, “FOR” the Reverse Stock Split Proposal, “FOR” the Authorized Share Increase Proposal, and “FOR” the Adjournment Proposal.

REalloys board of directors has (i) determined that the Merger Agreement and transactions contemplated thereby, including the Merger, are advisable and fair to and in the best interests of REalloys and its stockholders, (ii) unanimously approved the Merger Agreement and the transactions contemplated thereby, including the Merger and (iii) unanimously recommended that REalloys stockholders adopt and approve the Merger Agreement and the transactions contemplated thereby, including the Merger, by written consent.

This joint proxy and consent solicitation statement/prospectus provides you with important information about the special meeting and solicitation of written consents, Blackboxstocks, REalloys, the proposed Merger and the transactions and documents related to the Merger. Please carefully read this entire joint proxy and consent solicitation statement/prospectus, including “Risk Factors” beginning on page 34.

For the Blackboxstocks stockholders: your vote is very important. Whether or not you plan to attend the Special Meeting, please take the time to vote by completing and returning the enclosed proxy card to Blackboxstocks or by granting your proxy electronically over the Internet or by telephone. If your shares are held in “street name,” you must instruct your broker in order to vote on all proposals.

Sincerely,

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the Blackboxstocks securities to be issued in the Merger or determined if this joint proxy and consent solicitation statement/prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

This joint proxy and consent solicitation statement/prospectus is dated [●], 2025 and is first expected to be mailed or otherwise delivered to the stockholders of Blackboxstocks and REalloys on or about [●], 2025.

Blackboxstocks Inc.

5430 LBJ Freeway, Suite 1485

Dallas, Texas 75240

Notice Of Special Meeting Of Stockholders
To Be Held On [●], 2025

[●] a.m. Central Time

To be Held Online at [●]

To the Stockholders of Blackboxstocks Inc.:

NOTICE IS HEREBY GIVEN that a special meeting of the stockholders (the “Special Meeting”) of Blackboxstocks Inc., a Nevada corporation (“Blackboxstocks,” “we,” “our,” or “us”), will be held on [●], 2025, at [●] a.m., Central Time, and will be “virtual,” meaning that you can participate in the meeting online at [●], to consider and vote upon the following matters:

The Special Meeting will be a virtual meeting via live webcast on the Internet. As a Blackboxstocks stockholder, you will be able to attend the Special Meeting, vote and submit questions during the Special Meeting by visiting [●] and entering the control number included in the proxy card that you receive. If you are a “street name” holder, you must obtain a proxy from your broker or nominee in order to attend the Special Meeting and vote your shares. Blackboxstocks stockholders are encouraged to access the Special Meeting before the start time of [●] Central Time on [●], 2025. Please allow ample time for online check-in. Blackboxstocks stockholders will not be able to attend the Special Meeting in person.

Our board of directors has fixed the close of business on [●], 2025 as the record date for the Special Meeting. Only holders of record of shares of Blackboxstocks capital stock at the close of business on such date are entitled to receive notice of, and vote at, the Special Meeting or at any postponement(s) or adjournment(s) of the Special Meeting. A complete list of our stockholders of record entitled to vote at the Special Meeting will be available for ten (10) days before the Special Meeting at our principal executive office for inspection by stockholders during ordinary business hours for any purpose germane to the Special Meeting. The email should state the purpose of the request and provide proof of ownership of our voting securities as of the record date. The stockholder list will also be available online during the Special Meeting.

Approval of each of the Nasdaq Proposal, the Incentive Plan Proposal, the Reverse Stock Split Proposal, the Authorized Share Increase Proposal and the Adjournment Proposal requires the affirmative vote of the majority of the votes of the shares present in person or represented by proxy at the Special Meeting and entitled to vote on the subject matter and that are voted for or against the matter, and the Reverse Stock Split Proposal must also be approved by the holders of a majority of the issued and outstanding Blackboxstocks common stock, separately as a class.

OUR BOARD OF DIRECTORS HAS DETERMINED THAT IT IS ADVISABLE AND IN THE BEST INTEREST OF BLACKBOXSTOCKS AND ITS STOCKHOLDERS TO ENTER INTO THE MERGER AGREEMENT, AND THE BOARD HAS AUTHORIZED AND APPROVED THE TERMS OF THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY. OUR BOARD OF DIRECTORS HAS APPROVED THE MERGER AGREEMENT AND RECOMMENDS THAT BLACKBOXSTOCKS STOCKHOLDERS VOTE “FOR” THE NASDAQ PROPOSAL, “FOR” THE INCENTIVE PLAN PROPOSAL, “FOR” THE REVERSE STOCK SPLIT PROPOSAL, “FOR” THE AUTHORIZED SHARE INCREASE PROPOSAL, AND “FOR” THE ADJOURNMENT PROPOSAL

Your vote is very important. If your shares are registered in your name as a stockholder of record of Blackboxstocks, whether or not you expect to attend the Special Meeting, please sign and return the enclosed proxy card promptly in the envelope provided or promptly submit your proxy by telephone or over the Internet following the instructions on the proxy card, to ensure that your shares will be represented at the Special Meeting.

To participate in the virtual meeting, you will need the control number that is printed in the box marked by the arrow on your proxy card. If your shares are held in the name of a bank, brokerage firm, or other nominee, you should follow the instructions provided by them in order to participate in the virtual meeting.

You may revoke a proxy at any time prior to its exercise at the meeting by following the instructions in the enclosed joint proxy and consent solicitation statement/prospectus. If you are a “street name” holder, your bank, broker or other nominee should provide instructions explaining how you may change or revoke your voting instructions.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD ON [●], 2025, TO BE HELD ONLINE AT [●]: This notice is not a form for voting and presents only an overview of the more complete joint proxy and consent solicitation statement/prospectus. We urge you to read the accompanying joint proxy and consent solicitation statement/prospectus, including its annexes and the section titled “Risk Factors” beginning on page 34, carefully and in their entirety. Copies of the joint proxy and consent solicitation statement/prospectus and the accompanying proxy card are available, without charge, on the internet, on our website www.blackboxstocks.com, and can be obtained by sending an e-mail to investors@blackboxstocks.com. To obtain timely delivery, our stockholders must request the materials no later than five (5) business days prior to the Special Meeting. If you have any questions concerning the Merger, the Merger Agreement, the proposals, the Special Meeting or the accompanying joint proxy and consent solicitation statement/prospectus or need help voting your shares of Blackboxstocks securities, please contact Blackboxstocks’ investor relations department at investors@blackboxstocks.com.

REalloys Inc.

7280 W. Palmeto Park Rd.

Suite 302N

Boca Raton, FL 33433

Notice Of Solicitation Of Written Consent
For Action To Be Taken By Written Consent
In Lieu Of A Meeting Of Stockholders

To the Stockholders of REalloys Inc.:

Included in the accompanying joint proxy and consent solicitation statement/prospectus is a consent solicitation statement furnished by the board of directors of REalloys Inc., a Nevada corporation (“REalloys”), to the holders (collectively, the “REalloys stockholders”) of record of the outstanding shares of REalloys common stock and Series X Preferred Stock, par value $0.0001 per share (the “Series X Preferred Stock”) at the close of business on [●], 2025 (the “REalloys Record Date”).

This joint proxy and consent solicitation statement/prospectus is being delivered to REalloys stockholders as of the record date, to solicit written consent to the adoption and approval of the Agreement and Plan of Merger, dated as of March 10, 2025 (as may be amended from time to time, the “Merger Agreement” and such transactions contemplated thereunder, the “Merger”), by and among Blackboxstocks Inc., a Nevada corporation (“Blackboxstocks”), RABLBX Merger Sub, Inc., a Nevada corporation and a wholly owned subsidiary of Blackboxstocks (“Merger Sub”), and REalloys, pursuant to which Merger Sub will merge with and into REalloys, with REalloys continuing as the surviving corporation and a wholly owned subsidiary of Blackboxstocks, and to the transactions contemplated by the Merger Agreement, including the Merger (the “REalloys Merger Proposal”).

As an REalloys stockholder on the REalloys Record Date, you are urged to complete, date and sign the enclosed written consent and promptly return the completed and executed written consent by one of the means described in “REalloys Solicitation of Written Consent — Submission of Consents” beginning on page 116 of the enclosed joint proxy and consent solicitation statement/prospectus. REalloys’ board of directors has set [●], 2025, as the target final date for receipt of written consents. REalloys reserves the right to extend the final date for receipt of written consents without any prior notice to stockholders.

The enclosed joint proxy and consent solicitation statement/prospectus describes the Merger Agreement and the proposed Merger in detail and includes, as Annex A, the complete text of the Merger Agreement. We urge you to read the accompanying joint proxy and consent solicitation statement/prospectus, including all documents incorporated by reference into the accompanying joint proxy and consent solicitation statement/prospectus and its annexes carefully and in their entirety. In particular, you should carefully read the section captioned “Risk Factors” beginning on page 34 of the enclosed joint proxy and consent solicitation statement/prospectus for a discussion of certain risk factors relating to the Merger Agreement and the Merger.

Approval of the REalloys Merger Proposal requires the written consent of the holders of at least 50.1% of the outstanding shares of REalloys capital stock.

In considering the recommendation of the board of directors of REalloys with respect to the REalloys Merger Proposal, you should be aware that certain of REalloys’ directors and executive officers have interests that are different from, or in addition to, the interests of REalloys stockholders generally, as further described in the accompanying joint proxy and consent solicitation statement/prospectus.

A REalloys stockholder will have the right to seek appraisal of the fair value of such REalloys stockholder’s shares of REalloys stock if the Merger is completed, in lieu of receiving the per share Merger Consideration, but only if such REalloys stockholder does not sign and return a written consent to the REalloys Merger Proposal and otherwise complies with the procedures of Section 92A.300 to 92A.500 of the Nevada Revised Statutes (“NRS”), which is the appraisal rights statute applicable to Nevada corporations. These appraisal rights are summarized in the accompanying joint proxy and consent solicitation statement/prospectus.

Your written consent is very important. The Merger Agreement must be adopted by the written consent of REalloys stockholders of at least 50.1% of the outstanding shares of REalloys capital stock, in order for the Merger to be consummated. PLEASE NOTE: Your consents, as evidenced by your signing and returning the signature page to the enclosed written consent, are irrevocable once they are received by REalloys, as explained in the joint proxy and consent solicitation statement/prospectus. If you have any questions concerning the Merger, the Merger Agreement, the REalloys Merger Proposal, the written consent or the accompanying joint proxy and consent solicitation statement/prospectus, would like additional copies of the accompanying joint proxy and consent solicitation statement/prospectus or need help executing the written consent, please contact REalloys:

REalloys Inc.

7280 W. Palmeto Park Rd.

Suite 302N

Boca Raton, FL 33433

E-mail: corpsec@realloys.com

REALLOYS’ BOARD OF DIRECTORS HAS CAREFULLY CONSIDERED THE MERGER AND THE TERMS OF THE MERGER AGREEMENT AND HAS DETERMINED THAT THE MERGER IS ADVISABLE AND FAIR TO AND IN THE BEST INTERESTS OF REALLOYS AND ITS STOCKHOLDERS. ACCORDINGLY, REALLOYS’ BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT REALLOYS STOCKHOLDERS APPROVE THE MERGER AND ADOPT AND APPROVE THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE MERGER, BY EXECUTING AND DELIVERING THE WRITTEN CONSENT FURNISHED WITH THIS JOINT PROXY AND CONSENT SOLICITATION STATEMENT/PROSPECTUS.

Reference To Additional Information

This joint proxy and consent solicitation statement/prospectus includes important business and financial information about Blackboxstocks. Additional information about Blackboxstocks is available to you without charge upon your request. You can obtain any of the documents filed with or furnished to the Securities and Exchange Commission, or the “SEC,” by Blackboxstocks at no cost from the SEC’s website at http://www.sec.gov. You may also request copies of these documents at no cost by requesting them in writing or by telephone at the following address and telephone number:

Blackboxstocks Inc.:

5430 LBJ Freeway, Suite 1485

Dallas, Texas 75240

(972) 726-9203

Attention: Corporate Secretary

To obtain timely delivery of these documents, you must request them no later than five (5) business days before the date of the special meeting or deadline for submitting written consents. This means that Blackboxstocks stockholders requesting documents must do so by [●], 2025 and REalloys stockholders requesting documents must do so by [●], 2025.

You should rely only on the information contained in this document. No one has been authorized to provide you with information that is different from that contained in this document. This document is dated [●], 2025, and you should assume that the information in this document is accurate only as of such date. Neither the mailing nor delivery of this document to Blackboxstocks stockholders or REalloys stockholders nor the issuance by Blackboxstocks of shares of Blackboxstocks common stock in connection with the merger will create any implication to the contrary.

ABOUT THIS JOINT PROXY AND CONSENT SOLICITATION STATEMENT/PROSPECTUS

Except where the context otherwise indicates, information contained in this document regarding Blackboxstocks has been provided by Blackboxstocks and information contained in this document regarding REalloys has been provided by REalloys. See “Where You Can Find More Information” beginning on page 233 of this joint proxy and consent solicitation statement/prospectus for more details.

This document does not constitute an offer to sell, or a solicitation of an offer to buy any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.

Table Of Contents

Questions And Answers

The following are answers to some questions that Blackboxstocks stockholders and REalloys stockholders may have regarding the proposed Merger and the other proposals being considered by Blackboxstocks stockholders and REalloys stockholders. Blackboxstocks and REalloys urge you to read carefully this entire joint proxy and consent solicitation statement/prospectus, including the annexes, because the information in this section does not provide all the information that might be important to you.

Unless the context otherwise requires, references in this joint proxy and consent solicitation statement/prospectus to “Blackboxstocks” refers to Blackboxstocks Inc., a Nevada corporation; “Merger Sub” refers to RABLBX Merger Sub, Inc., a Nevada corporation and a wholly owned subsidiary of Blackboxstocks, and “REalloys” refers to REalloys Inc., a privately-held Nevada corporation.

Questions and Answers About the Merger

Blackboxstocks, Merger Sub and REalloys have entered into an Agreement and Plan of Merger, dated as of March 10, 2025 (as may be amended from time to time, the “Merger Agreement”). Pursuant to the Merger Agreement, Merger Sub will be merged with and into REalloys, with REalloys continuing as the surviving company (the “surviving corporation”) and a wholly owned subsidiary of Blackboxstocks (following the consummation of the Merger and the name changes described below, the “combined company” or the “Combined Company” and such closing of the Merger, the “Closing” and such date, the “Closing Date”). See “The Merger” beginning on page 118 and “The Merger Agreement” beginning on page 135 of this joint proxy and consent solicitation statement/prospectus. A copy of the Merger Agreement is attached to this joint proxy and consent solicitation statement/prospectus as Annex A.

If the Merger is completed:

Additionally, at the Effective Time, each warrant (the “REalloys Warrants”) issued pursuant to that certain securities purchase agreement, dated as of March 6, 2025, by and between REalloys and the investor named therein, that is outstanding and unexercised immediately prior to the Effective Time, will be converted into and become a warrant to purchase Blackboxstocks common stock, and Blackboxstocks shall assume the terms of the REalloys Warrants pursuant to the terms of the Merger Agreement and as further described herein.

Additionally, each holder of Blackboxstocks common stock of record as of immediately prior to the Effective Time shall be entitled to one contingent value right (“CVR”) for each share of Blackboxstocks common stock held by such holder, which shall be issued by Blackboxstocks pursuant to a Contingent Value Rights Agreement as contemplated by the Merger Agreement (the “CVR Agreement”). The CVRs will represent the rights to receive cash payments in connection with certain transactions involving the assets, rights and properties owned, used or usable by Blackbox Operating.

In addition, prior to the Effective Time: (i) Gust Kepler and Leonard Sternheim agreed to enter into a Securities Transfer Agreement, in a form acceptable to Gust Kepler and Leonard Sternheim, pursuant to which Gust Kepler will sell 1,634,999 shares of Series A Convertible Preferred Stock, par value $0.001 per share, of Blackboxstocks (the “Series A Preferred Stock”) to Leonard Sternheim (the “Preferred Transfer”), which sale shall be contingent upon and effective concurrently with Closing (the “Securities Transfer Agreement”) and (ii) Blackboxstocks and Gust Kepler will execute an option agreement (the “Option Agreement”) substantially in the form attached hereto as Annex G, pursuant to which Blackboxstocks shall have the right to call for redemption and Gust Kepler shall have the right to cause Company to redeem all of the remaining issued and outstanding Series A Preferred Stock, following such Preferred Transfer, held by Gust Kepler in exchange for shares of Series A Preferred Stock of Blackbox Operating.

In connection with the consummation of the Merger, (i) at the Effective Time, Blackboxstocks will amend its Articles of Incorporation (as amended, the “Blackboxstocks Articles”) to cause its name to be changed to “REalloys Inc.” and (ii) at the Closing (as part of the filing of the certificate of merger) REalloys will amend its Articles of Incorporation (the “REalloys Articles”) to cause its name to be changed to “REalloys Solutions Inc.” 

For the Merger to be consummated, the Merger Agreement requires, among other things, unless otherwise waived by Blackboxstocks and REalloys:

This joint proxy and consent solicitation statement/prospectus contains important information about the Merger and the proposals being voted on by Blackboxstocks stockholders and REalloys stockholders, and you should read it carefully. This document collectively serves as a proxy statement of Blackboxstocks, consent solicitation statement of REalloys and a prospectus of Blackboxstocks. It is a joint proxy and consent solicitation statement because both the Blackboxstocks and REalloys boards of directors are soliciting proxies or written consents from their respective stockholders. It is a prospectus because Blackboxstocks will issue shares of Blackboxstocks common stock and Series C Preferred Stock to REalloys stockholders in connection with the Merger. Your vote is important. You are encouraged to submit your proxy or written consent as soon as possible after carefully reviewing this joint proxy and consent solicitation statement/prospectus and its annexes.

Questions and Answers for Blackboxstocks Stockholders

These interests may influence the Blackboxstocks directors in making their recommendation that you vote in favor of the approval of the Nasdaq Proposal and other proposals. For a more complete description of these interests, see “The Merger — Interests of Blackboxstocks’ Directors and Executive Officers in the Merger” beginning on page 128 of this joint proxy and consent solicitation statement/prospectus.

Blackboxstocks Inc.

5430 LBJ Freeway, Suite 1485

Dallas, Texas 75240

(972) 726-9203

Attention: Gust Kepler, President and Chief Executive Officer

Telephone: (972) 726-9203

Questions and Answers for REalloys Stockholders

Risk Factors

You should carefully consider the risks described below in evaluating whether to vote for or consent to the proposals discussed herein. The risks and uncertainties described below are not the only ones Blackboxstocks and REalloys face, and these factors should be considered in conjunction with general investment risks and other information included in this joint proxy and consent solicitation statement/prospectus, including the matters addressed in the section titled “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 94 of this joint proxy and consent solicitation statement/prospectus. You should read and consider the risks associated with the business of REalloys beginning on page 49 of this joint proxy and consent solicitation statement/prospectus as these risk factors will also affect the operations of the Combined Company going forward because the business of the Combined Company will be REalloys’ business. You should also read and consider the risk factors associated with Blackboxstocks beginning on page 81 of this joint proxy and consent solicitation statement/prospectus because these risk factors may affect the operations and financial results of the Combined Company.

Risks Related to the Proposed Merger

There is no assurance when or if the Merger will be completed. Any delay in completing the Merger may substantially reduce the potential benefits that Blackboxstocks and REalloys expect to obtain from the Merger.

Completion of the Merger is subject to the satisfaction or waiver of a number of conditions, as set forth in the Merger Agreement, including the approval by Blackboxstocks’ stockholders, approval by Nasdaq of Blackboxstocks’ application for the initial listing of Blackboxstocks’ common stock to be issued in connection with the Merger, and other customary closing conditions. There can be no assurance that Blackboxstocks and REalloys will be able to satisfy the closing conditions or that closing conditions beyond their control will be satisfied or waived. For a discussion of the conditions to the completion of the Merger, see the section titled “The Merger Agreement - Conditions to the Closing of the Merger” beginning on page 138 of this joint proxy and consent solicitation statement/prospectus. If the conditions are not satisfied or waived, the Merger may not occur or may not be completed within the expected timeframe, and Blackboxstocks and REalloys each may materially and adversely lose some or all of the potential benefits that Blackboxstocks and REalloys expect to achieve as a result of the Merger and could result in additional transaction costs or other effects associated with uncertainty about the Merger. In addition, pursuant to the Merger Agreement, Blackboxstocks may extend the originally scheduled End Date (defined in the Merger Agreement as the nine month anniversary of the date of the Merger Agreement, subject to possible extension pursuant to the terms of the Merger Agreement) for sixty (60) days in the event that the SEC has not declared effective under the Securities Act this registration statement on Form S-4. Moreover, each of Blackboxstocks and REalloys has incurred and expects to continue to incur significant expenses related to the Merger, such as legal and accounting fees, some of which must be paid even if the Merger is not completed.

Blackboxstocks and REalloys can agree at any time to terminate the Merger Agreement, even if Blackboxstocks’ stockholders and/or REalloys’ securityholders have already adopted the Merger Agreement and thereby approved the Merger and the other transactions contemplated by the Merger Agreement. Blackboxstocks and REalloys can also terminate the Merger Agreement under other specified circumstances.

In addition, if the Merger Agreement is terminated and Blackboxstocks’ or REalloys’ board of directors determines to seek another business combination, it may not be able to find a third party willing to provide equivalent or more attractive consideration than the consideration to be provided by each party in the Merger. In such circumstances, the Blackboxstocks Board of Directors may elect to, among other things, divest all or a portion of Blackboxstocks’ business, or take the steps necessary to liquidate all of Blackboxstocks’ business and assets, and in either case, the consideration that Blackboxstocks receives may be less attractive than the consideration to be received by Blackboxstocks pursuant to the Merger Agreement.

The issuance of shares of Blackboxstocks common stock to REalloys stockholders in the Merger will substantially dilute the voting power of current Blackboxstocks stockholders. Having a minority share position will reduce the influence that current stockholders have on the management of Blackboxstocks.

Pursuant to the terms of the Merger Agreement, at the Effective Time, Blackboxstocks will issue (or reserve for future issuance) to REalloys stockholders as Merger Consideration: (i) approximately [●] shares of its common stock, using the assumed Exchange Ratio of [●], (ii) approximately [●] shares of Series C Preferred Stock at a ratio of one share of REalloys Preferred Stock to one share of Series C Preferred Stock (which is subject to change depending on the number of outstanding securities of Blackboxstocks and REalloys at the effective time of the Merger), (iii) warrants to purchase up to an aggregate of approximately [●] shares of Blackboxstocks common stock based on an assumed price of $[●] per share, the closing price of the Blackboxstocks common stock on Nasdaq on [●], 2025, and (iv) an aggregate of approximately [●] shares of Blackboxstocks common stock as related to the REalloys SAFEs, based on an assumed price of $[●] per share, the closing price of the Blackboxstocks common stock on Nasdaq on [●], 2025, in each case after giving effect to the proposed reverse stock split contemplated by the Reverse Stock Split Proposal. As a result, upon completion of the Merger, the current Blackboxstocks stockholders and holders of certain outstanding options and warrants to purchase shares of Blackboxstocks common stock will hold approximately [●] pre-reverse stock split shares, which is currently expected to be approximately 7.3% of the fully diluted equity of the Combined Company as further described under “The Merger - General” in this joint proxy and consent solicitation statement/prospectus. Accordingly, the issuance of the shares of Blackboxstocks common stock to REalloys stockholders in the Merger will significantly reduce the ownership stake and relative voting power of each share of Blackboxstocks common stock held by current Blackboxstocks stockholders. Consequently, following the Merger, the ability of Blackboxstocks’ current stockholders to influence the management of Blackboxstocks will be substantially reduced.

The issuance, or expected issuance, of Blackboxstocks common stock and Series C Preferred Stock in connection with the Merger could decrease the market price of Blackboxstocks common stock.

In connection with the Merger and as part of the Merger Consideration, Blackboxstocks expects to issue shares of Blackboxstocks common stock and Series C Preferred Stock to REalloys stockholders. The anticipated issuance of Blackboxstocks common stock and Series C Preferred Stock in the Merger may result in fluctuations in the market price of Blackboxstocks common stock, including a stock price decrease. In addition, the perception in the market that the holders of a large number of shares of Blackboxstocks common stock may intend to sell shares could reduce the market price of Blackboxstocks common stock.

CVR holders may not receive any payment on the CVRs and the CVRs may otherwise expire valueless.

Pursuant to the CVR Agreement and the Merger Agreement, holders of each share of Blackboxstocks common stock immediately prior to Closing, will receive a dividend of one contractual contingent value right entitling such holders to receive net proceeds received by Blackboxstocks from any transaction in which the Blackboxstocks or Blackbox Operating grants, sells, licenses or otherwise transfers some or all of the rights to any and all of the assets, rights, and properties owned, used, or useable by Blackbox Operating in connection with or related to the business as conducted by Blackbox Operating, or, under certain circumstances, distribution of securities of Blackbox Operating held by Blackboxstocks, and all of the Blackboxstocks rights therein. The right of Blackboxstocks stockholders to receive any future payment on or to derive any value from the CVRs will be contingent solely upon the achievement of the events specified in the CVR Agreement within the time period specified in the CVR Agreement. If the payment triggering events are not achieved for any reason within the time period specified in the CVR Agreement, no payments will be made under the CVRs, and the CVRs will expire valueless.

Additionally, the U.S. federal income tax treatment of the CVRs is subject to substantial uncertainty. There is no legal authority directly addressing the U.S. federal income tax treatment of the receipt of, and payments under, the CVRs, and there can be no assurance that the IRS would not assert, or that a court would not sustain, a position that could potentially result in adverse U.S. federal income tax consequences to holders of the CVRs.

In particular, as discussed in the section titled “CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE RECEIPT OF CONTINGENT VALUE RIGHTS,” Blackboxstocks intends to take the position that the fair market value of the CVRs cannot be reasonably ascertained on the date of the issuance of the CVRs and, accordingly, the issuance of the CVRs constitutes an “open transaction.” Accordingly, absent a change in law requiring otherwise, Blackboxstocks will not report the issuance of the CVRs as a current distribution of property with respect to its stock and will instead report each future cash payment (if any) on the CVRs as a distribution by Blackboxstocks for U.S. federal income tax purposes, with each such payment being reported as a dividend to the extent of Blackboxstocks current or accumulated earnings and profits in the year in which such payment is made. there is no authority directly addressing whether the issuance of contingent value rights with characteristics similar to the CVRs should be treated as a distribution of property with respect to Blackboxstocks’ common stock, a distribution of equity, a “debt instrument” or an “open transaction” for U.S. federal income tax purposes. Applicable U.S. Treasury regulations provide that “open transaction” treatment is only available in those “rare and extraordinary cases” involving contingent payment obligations in which the “fair market value of the obligation cannot reasonably be ascertained.” If the issuance of the CVRs is treated as an “open transaction,” a CVR holder would not generally recognize income in respect of the CVRs at the time such CVRs are issued and would take no tax basis in the CVRs. Future cash payments (if any) on the CVRs would be treated as a distribution and constitute a dividend to the extent of the CVR holder’s pro rata share of Blackboxstocks current or accumulated earnings and profits (as determined for U.S. federal income tax purposes) in the taxable year of such payment, then as a non-taxable return of capital to the extent of the CVR holder’s basis in its Blackboxstocks common stock, and finally as capital gain from the sale or exchange of Blackboxstocks common stock with respect to any remaining payment.

The intended benefits of the Merger may not be realized.

The Merger poses risks for Blackboxstocks’ and REalloys’ ongoing operations, including, among others:

As a result of the foregoing, the Combined Company may be unable to realize the full strategic and financial benefits currently anticipated from the Merger, and Blackboxstocks and REalloys cannot assure you that the Merger will be accretive to Blackboxstocks or REalloys in the near term or at all. Furthermore, if Blackboxstocks and REalloys fail to realize the intended benefits of the Merger, the market price of the Combined Company’s common stock could decline to the extent that the market price reflects those benefits. Blackboxstocks’ stockholders will have experienced substantial dilution of their ownership interests in Blackboxstocks without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent the Combined Company is able to realize only part of the strategic and financial benefits currently anticipated from the Merger.

Because the lack of a public market for REalloys common stock makes it difficult to evaluate the fairness of the Merger, REalloys stockholders may receive consideration in the Merger that is greater than or less than the fair market value of REalloys common stock.

The outstanding common stock of REalloys is privately held and is not traded in any public market. The lack of a public market makes it extremely difficult to determine the fair market value of REalloys common stock. Since the percentage of Blackboxstocks’ common stock and Series C Preferred Stock to be issued to REalloys stockholders was determined based on negotiations between the parties, it is possible that the value of the Blackboxstocks common stock and Series C Preferred Stock to be issued in connection with the Merger will be greater than the fair market value of REalloys shares. Alternatively, it is possible that the value of the shares of Blackboxstocks common stock and Series C Preferred Stock to be issued in connection with the Merger will be less than the fair market value of REalloys shares.

Directors and officers of Blackboxstocks and REalloys may have interests in the Merger that are different from, or in addition to, those of Blackboxstocks stockholders and REalloys stockholders generally that may influence them to support or approve the Merger.

The officers and directors of Blackboxstocks and REalloys may have interests in the Merger that are different from, or are in addition to, those of Blackboxstocks stockholders and REalloys stockholders generally. Effective upon the closing of the Merger, David Argyle, Leonard Sternheim and Robert Winspear are expected to be employed as executive officers by the Combined Company. It is expected that six of the current directors of REalloys, and one current director of Blackboxstocks will be appointed as directors of the Combined Company after the completion of the Merger and may receive cash and equity compensation in consideration for such service as described in more detail in the section titled “Management of the Combined Company” beginning on page 154 of this joint proxy and consent solicitation statement/prospectus. Contingent upon closing of the Merger, Gust Kepler has agreed to sell Leonard Sternheim certain shares of Blackboxstocks Series A Preferred Stock that will effectively confer voting control of the Combined Company currently held by Mr. Kepler to Mr. Sternheim for nominal consideration. Upon the Merger, the vesting of outstanding equity awards held by Blackboxstocks’ directors and officers will accelerate, and certain Blackboxstocks officers may be entitled to certain severance benefits in connection with changes in their employment. In addition, the directors and executive officers of Blackboxstocks and REalloys also have certain rights to indemnification or to directors’ and officers’ liability insurance that will survive the completion of the Merger. These interests may have influenced the directors and executive officers of Blackboxstocks and REalloys to support or recommend the proposals presented to Blackboxstocks and REalloys stockholders. See the sections titled “The Merger - Interests of Blackboxstocks’ Directors and Executive Officers in the Merger” beginning on page 128 and “The Merger - Interests of REalloys’ Directors and Executive Officers in the Merger” beginning on page 131 of this joint proxy and consent solicitation statement/prospectus.

If the Merger is completed, REalloys executive officers and REalloys appointees to the Combined Company’s board of directors will have the ability to significantly influence the Combined Company’s management and business affairs, as well as matters submitted to the Combined Company’s board of directors or stockholders for approval, especially if they decide to act together with the current REalloys stockholders.

Upon completion of the Merger, the former REalloys stockholders will own approximately 92.7% of the Combined Company on a fully diluted basis, excluding the effects of adjustments based on Blackboxstocks’ net cash at closing. Contingent upon closing of the Merger, Gust Kepler has also agreed to sell Leonard Sternheim certain shares of Blackboxstocks Series A Preferred Stock that will effectively confer voting control of the Combined Company to Mr. Sternheim. If the Merger is completed, the Combined Company is expected to be led by REalloys’ executive officers. Furthermore, the Combined Company’s anticipated board of directors will consist of seven members, six of which will be appointed by REalloys and one of which will be appointed by Blackboxstocks, pursuant to the terms and conditions of the Merger Agreement. As a result, such persons, if they choose to act together, will have the ability to significantly influence the Combined Company’s management and business affairs, as well as matters submitted to the Combined Company’s board of directors or stockholders for approval.

The announcement and pendency of the Merger could have an adverse effect on Blackboxstocks’ or REalloys’ business, financial condition, results of operations or business prospects.

The announcement and pendency of the Merger could disrupt Blackboxstocks’ and/or REalloys’ businesses in the following ways, among others:

Should they occur, any of these matters could adversely affect the businesses of, or harm the financial condition, results of operations or business prospects of, Blackboxstocks or REalloys.

During the pendency of the Merger, Blackboxstocks or REalloys may not be able to enter into a business combination with another party and will be subject to contractual limitations on certain actions because of restrictions in the Merger Agreement.

Covenants in the Merger Agreement impede the ability of Blackboxstocks or REalloys to make dispositions or acquisitions or complete other transactions that are not in the ordinary course of business pending completion of the Merger. As a result, if the Merger is not completed, the parties may be at a disadvantage to their competitors. In addition, while the Merger Agreement is in effect and subject to limited exceptions, each party is prohibited from soliciting, initiating, encouraging or taking actions designed to facilitate any inquiries or the making of any proposal or offer that could lead to the entering into certain extraordinary transactions with any third party, such as a sale of assets, an acquisition, a tender offer, a Merger or other business combination outside the ordinary course of business. These restrictions may prevent each of Blackboxstocks and REalloys from pursuing otherwise attractive business opportunities or other capital structure alternatives and making other changes to their business or executing certain of their business strategies prior to the completion of the Merger, which could be favorable to Blackboxstocks stockholders or REalloys stockholders. See the section titled “The Merger Agreement - No Solicitation” beginning on page 141 of this joint proxy and consent solicitation statement/prospectus.

The rights of REalloys stockholders who become Blackboxstocks stockholders in the Merger and Blackboxstocks stockholders following the Merger will be governed by the Blackboxstocks Articles, as amended, and the Blackboxstocks Bylaws.

Upon consummation of the Merger, outstanding shares of REalloys common stock will be converted into the right to receive shares of Blackboxstocks common stock pursuant to the Exchange Ratio and each outstanding share of REalloys Preferred Stock will be converted into one share of Series C Preferred Stock. REalloys stockholders who receive shares of Blackboxstocks common stock and Series C Preferred Stock in the Merger will become Blackboxstocks stockholders. As a result, REalloys stockholders who become stockholders in Blackboxstocks will be governed by Blackboxstocks Articles, as amended, and the Blackboxstocks Bylaws, rather than being governed by the REalloys Articles and the REalloys bylaws (the “REalloys Bylaws”). Pursuant to the Merger Agreement, the Blackboxstocks Articles may be amended, subject to Blackboxstocks stockholders’ approval of the Reverse Stock Split Proposal and the Authorized Share Increase Proposal, immediately prior to the Effective Time. See the section titled “Comparison of Corporate Governance and Stockholders’ Rights” beginning on page 226 of this joint proxy and consent solicitation statement/prospectus.

The Exchange Ratio is not adjustable based on the market price of Blackboxstocks’ common stock, so the Merger consideration at the closing may have a greater or lesser value than at the time the Merger Agreement was signed.

The Merger Agreement has set the Exchange Ratio formula for the REalloys common stock, and the Exchange Ratio is only adjustable upward or downward to reflect Blackboxstocks’ and REalloys’ equity capitalization as of immediately prior to the Effective Time and the excess cash Blackboxstocks has at the effective time of the Merger. Any changes in the market price of common stock before the completion of the Merger will not affect the number of shares REalloys securityholders will be entitled to receive pursuant to the Merger Agreement. Therefore, if before the completion of the Merger, the market price of Blackboxstocks common stock declines from the market price on the date of the Merger Agreement, then REalloys securityholders could receive Merger consideration with substantially lower value. Similarly, if before the completion of the Merger, the market price of Blackboxstocks common stock increases from the market price on the date of the Merger Agreement, then REalloys securityholders could receive Merger Consideration with substantially more value for their shares of REalloys common stock than the parties had negotiated for in the establishment of the Exchange Ratio. For a discussion of the Exchange Ratio, see the section titled “The Merger Agreement - Exchange Ratio” beginning on page 137 of this joint proxy and consent solicitation statement/prospectus.

If the Merger does not qualify as a reorganization under Section 368(a) of the Internal Revenue Code of 1986, as amended, or is otherwise taxable to U.S. REalloys stockholders, then such holders may be required to pay U.S. federal income taxes.

For U.S. federal income tax purposes, the Merger is intended to constitute a reorganization or tax deferred contribution within the meaning of Section 368(a) of the Code. If the Internal Revenue Service (the “IRS”) or a court determines that the Merger should not be treated as a reorganization, a holder of REalloys stock or warrants would recognize taxable gain or loss upon the exchange of REalloys stock or warrants for Blackboxstocks common stock or warrants pursuant to the Merger Agreement.

Blackboxstocks is expected to incur substantial expenses related to the Merger with REalloys.

Blackboxstocks has incurred, and expects to continue to incur, substantial expenses in connection with the Merger, as well as operating as a public company. Blackboxstocks will incur significant fees and expenses relating to legal, accounting, financial advisory and other transaction fees and costs associated with the Merger. Actual transaction costs may substantially exceed Blackboxstocks’ estimates and may have an adverse effect on the Combined Company’s financial condition and operating results.

Failure to complete the Merger could negatively affect the value of Blackboxstocks common stock and the future business and financial results of both Blackboxstocks and REalloys.

If the Merger is not completed, the ongoing businesses of Blackboxstocks and REalloys could be adversely affected. Moreover, each of Blackboxstocks and REalloys will be subject to a variety of risks associated with the failure to complete the Merger, including without limitation the following:

If the Merger is not completed, the market price of Blackboxstocks common stock and the business and financial results of both Blackboxstocks (including the cessation of its operations) and REalloys could be materially affected.

The Merger is expected to result in a limitation on the Combined Company’s ability to utilize its net operating loss carryforward.

Under Section 382 of the Code, use of Blackboxstocks’ net operating loss carryforwards (“NOLs”) will be limited if Blackboxstocks experiences a cumulative change in ownership of greater than 50% in a moving three-year period. At December 31, 2024, Blackboxstocks had approximately $4.4 million of net operating loss carryforwards, which NOLs will begin to expire in 2035 and are available to offset taxable income or reduce taxes payable through 2040. Blackboxstocks will experience an ownership change as a result of the Merger and therefore its ability to utilize its NOLs and certain credit carryforwards remaining at the effective time of the Merger will be limited. The limitation will be determined by the fair market value of Blackboxstocks’ common stock outstanding prior to the ownership change, multiplied by the applicable federal rate. It is expected that the Merger will impose a limitation on Blackboxstocks’ NOLs. Limitations imposed on Blackboxstocks’ ability to utilize NOLs could cause U.S. federal and state income taxes to be paid earlier than would be paid if such limitations were not in effect and could cause such NOLs to expire unused, in each case reducing or eliminating the benefit of such NOLs.

The Merger may be completed even though material adverse changes may result from the announcement of the Merger, industry-wide changes or other causes.

In general, either party can refuse to complete the Merger if there is a material adverse effect (as defined in the Merger Agreement) affecting the other party between March 10, 2025, the date of the Merger Agreement, and the closing of the Merger. However, some types of changes do not permit either party to refuse to complete the Merger, even if such changes would have a material adverse effect on Blackboxstocks or REalloys, as the case may be:

If adverse changes occur but Blackboxstocks and REalloys must still complete the Merger, the market price of Blackboxstocks common stock may suffer. For a more complete discussion of what constitutes a material adverse effect on Blackboxstocks or REalloys under the Merger Agreement, see the section titled “The Merger Agreement - Representations and Warranties” beginning on page 140 of this joint proxy and consent solicitation statement/prospectus.

Blackboxstocks and REalloys may become involved in securities litigation or stockholder derivative litigation in connection with the Merger, and this could divert the attention of Blackboxstocks and REalloys management and harm the Combined Company’s business, and insurance coverage may not be sufficient to cover all related costs and damages.

Securities litigation or stockholder derivative litigation frequently follows the announcement of certain significant business transactions, such as the sale of a business division or announcement of a business combination transaction. Blackboxstocks and REalloys may become involved in this type of litigation in connection with the Merger, and the Combined Company may become involved in this type of litigation in the future. Litigation often is expensive and diverts management’s attention and resources, which could adversely affect the business of Blackboxstocks, REalloys and the Combined Company.

Risks Related to the Proposed Reverse Stock Split

The reverse stock split may not increase the Combined Company’s stock price over the long term.

If the Reverse Stock Split Proposal is approved, Blackboxstocks may effect a reverse stock split in order to cause its stock price to be at least $4.00 with a ratio between [●]-for-[●] and [●]-for-[●] immediately prior to the Merger. While it is expected that the reduction in the number of outstanding shares of common stock will proportionally increase the market price of the Combined Company’s common stock upon effectiveness of the reverse stock split, it cannot be assured that the reverse stock split will result in any sustained proportionate increase in the market price of the Combined Company’s common stock, which is dependent upon many factors, including the business and financial performance of the Combined Company, general market conditions, and prospects for future success, which are unrelated to the number of shares of the Combined Company’s common stock outstanding. Thus, while the stock price of the Combined Company might meet the initial listing requirements for Nasdaq initially, it cannot be assured that it will continue to do so.

The reverse stock split would have the effect of increasing the amount of common stock that the Combined Company is authorized to issue without further approval by the Combined Company’s stockholders.

As a result of the reverse stock split, if effected, and after giving effect to the Merger, the Combined Company expects that it will have between approximately [●] shares and [●] shares of common stock outstanding, excluding shares underlying the Series C Preferred Stock, REalloys Warrants, and other outstanding securities convertible or exercisable into shares of common stock and any issued fractional shares in the aggregate, compared to approximately [●] shares of common stock outstanding of the Combined Company after giving effect to the Merger and in the absence of a reverse stock split, based on the assumed Exchange Ratio of [●]. The proposed increase in shares of authorized stock pursuant to the Authorized Share Increase Proposal is anticipated to authorize Blackboxstocks to issue up to [●] shares of common stock and does not anticipate reducing this amount in connection with the reverse stock split. As a result, it is anticipated that, following the reverse stock split, the Combined Company will have the ability to issue between approximately [●] and [●] additional shares of common stock, including shares that may be issued pursuant to awards that have been granted and outstanding warrants. Except in certain instances, as required by law or by the rules of the securities exchange that lists the Combined Company’s common stock, these additional shares may be issued by the Combined Company without further vote of the Combined Company’s stockholders. If the Combined Company’s board of directors chooses to issue additional shares of the Combined Company’s common stock, such issuance could have a dilutive effect on the equity, earnings and voting interests of the Combined Company’s stockholders.

The reverse stock split may decrease the liquidity of Blackboxstocks’ common stock.

Although the Blackboxstocks Board of Directors believes that the anticipated increase in the market price of Blackboxstocks common stock could encourage interest in its common stock and possibly promote greater liquidity for its stockholders, such liquidity could also be adversely affected by the reduced number of shares outstanding after the reverse stock split. The reduction in the number of outstanding shares may lead to reduced trading and a smaller number of market makers for Blackboxstocks’ common stock.

The reverse stock split may lead to a decrease in overall market capitalization of the Combined Company.

Should the market price of Blackboxstocks’ common stock decline after the reverse stock split, in the event that it is effected, the percentage decline may be greater, due to the smaller number of shares outstanding, than it would have been prior to the reverse stock split. A reverse stock split is often viewed negatively by the market and, consequently, can lead to a decrease in the overall market capitalization of the Combined Company. If the per share market price does not increase in proportion to the reverse stock split ratio, then the value of the Combined Company, as measured by its stock capitalization, will be reduced. In some cases, the per-share stock price of companies that have effected reverse stock splits subsequently declined back to pre-reverse split levels and, accordingly, it cannot be assured that the total market value of Blackboxstocks common stock will remain the same after the reverse stock split is effected, or that the reverse stock split will not have an adverse effect on Blackboxstocks’ stock price due to the reduced number of shares outstanding after the reverse stock split.

Risks Related to the Combined Company Following the Merger

Blackboxstocks stockholders and REalloys stockholders may not realize a benefit from the Merger commensurate with the ownership dilution they will experience in connection with the Merger.

If the combined organization is unable to realize the full strategic and financial benefits currently anticipated from the Merger, Blackboxstocks stockholders and REalloys stockholders will have experienced substantial dilution of their ownership interests in their respective companies without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent the combined organization is able to realize only part of the strategic and financial benefits currently anticipated from the Merger. Furthermore, if the Combined Company fails to realize the intended benefits of the Merger, the market price of Blackboxstocks common stock could decline to the extent that the market price reflects those benefits.

The market price of the Combined Company’s common stock after the Merger may be subject to significant fluctuations and volatility, and the stockholders of the company may be unable to resell their shares at a profit and may incur losses.

There has not been a public market for the Combined Company’s common stock. The market price of the Combined Company’s common stock could be subject to significant fluctuation following the Merger. The current business of Blackboxstocks differs from that of REalloys in important respects and, accordingly, the results of operations of the Combined Company and the market price of the Combined Company’s common stock following the Merger may be affected by factors different from those currently affecting the results of operations of Blackboxstocks. Market prices for securities of companies operating in the same industries that the Combined Company expects to operate within have historically been particularly volatile and have shown extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. Broad market and industry factors, as well as general economic, political and market conditions such as recessions or interest rate changes, may seriously affect the market price of the Combined Company’s common stock, regardless of the actual operating performance of the Combined Company. Some of the factors that may cause the market price of the Combined Company’s common stock to fluctuate include:

In the past, following periods of volatility in the overall market and the market prices of particular companies’ securities, securities class action litigation has often been instituted against these companies. Litigation of this type, if instituted against the Combined Company, could result in substantial costs and a diversion of management’s attention and resources of the Combined Company. Any adverse determination in any such litigation or any amounts paid to settle any such actual or threatened litigation could require that the Combined Company make significant payments.

If the Merger is consummated, the business operations, strategies and focus of the Combined Company will fundamentally change, and these changes may not result in an improvement in the value of its common stock.

Pending the consummation of the Merger it is currently anticipated that the Combined Company would focus its resources on executing REalloys’ current business plan.

Following the Merger, it is expected that the Combined Company’s primary product will be REalloys’ products. Consequently, if the Merger is consummated, an investment in Blackboxstocks’ common stock will primarily represent an investment in the business operations, strategies and focus of REalloys. REalloys’ failure to successfully market its products will significantly diminish the anticipated benefits of the Merger and have a material adverse effect on the business of the Combined Company. There is no assurance that the Combined Company’s business operations, strategies or focus will be successful following the Merger, and the Merger could depress the value of the Combined Company’s common stock.

The unaudited pro forma condensed combined financial statements are presented for illustrative purposes only, and future results of the Combined Company may differ materially from the unaudited pro forma financial statements presented in this joint proxy and consent solicitation statement/prospectus.

The unaudited pro forma condensed combined financial statements contained in this joint proxy and consent solicitation statement/prospectus are presented for illustrative purposes only and may not be an indication of the Combined Company’s financial condition or results of operations following the completion of the Merger for several reasons. The unaudited pro forma condensed combined financial statements have been derived from the historical financial statements of Blackboxstocks and REalloys and adjustments and assumptions have been made regarding the Combined Company. The information upon which these adjustments and assumptions have been made is preliminary, and these kinds of adjustments and assumptions are difficult to make with accuracy. Moreover, the unaudited pro forma condensed combined financial statements do not reflect all costs that are expected to be incurred by the Combined Company in connection with the Merger. As a result, the actual financial condition and results of operations of the Combined Company following the completion of the Merger may not be consistent with, or evident from, these unaudited pro forma condensed combined financial statements. The assumptions used in preparing the pro forma financial information may not prove to be accurate, and other factors may affect the Combined Company’s financial condition or results of operations following the Merger. Any decline or potential decline in the Combined Company’s financial condition or results of operations may cause significant variations in the market price of Blackboxstocks common stock.

The Combined Company may issue additional equity securities in the future, which may result in dilution to existing investors.

To the extent the Combined Company raises additional capital by issuing equity securities, the Combined Company’s stockholders may experience substantial dilution. The Combined Company may, from time to time, sell additional equity securities in one or more transactions at prices and in a manner it determines. If the Combined Company sells additional equity securities, existing stockholders may be materially diluted. In addition, new investors could gain rights superior to existing stockholders, such as liquidation and other preferences. In addition, the number of shares available for future grant under the Combined Company’s equity compensation plans may be increased in the future. In addition, the exercise of outstanding options or warrants to purchase shares of capital stock may result in dilution to the Combined Company’s stockholders upon any such exercise.

All of Blackboxstocks’ outstanding shares of common stock are, and any shares of Blackboxstocks common stock that are issued in the Merger will be, freely tradable without restrictions (subject to the Lock-Up Agreements (as defined herein) or further registration under the Securities Act, except for any shares held by affiliates of the Combined Company, as defined in Rule 144 under the Securities Act. Rule 144 defines an affiliate as a person who directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Combined Company and would include persons such as the Combined Company’s directors and executive officers and large stockholders. In turn, resales, or the perception by the market that a substantial number of resales could occur, could have the effect of depressing the market price of the Combined Company’s common stock.

The concentration of the capital stock ownership with insiders of the Combined Company after the Merger will likely limit the ability of the stockholders of the Combined Company to influence corporate matters.

Following the Merger, the executive officers, directors, five percent or greater stockholders, and the respective affiliated entities of the Combined Company will, in the aggregate, beneficially own approximately [●]% of the Combined Company’s outstanding common stock and 100% of the Combined Company’s outstanding Series A Preferred Stock. As a result, these stockholders, acting together, have control over matters that require approval by the Combined Company’s stockholders, including the election of directors and approval of significant corporate transactions. Corporate actions might be taken even if other stockholders oppose them. This concentration of ownership might also have the effect of delaying or preventing a corporate transaction that other stockholders may view as beneficial.

Certain stockholders could attempt to influence changes within Blackboxstocks, which could adversely affect Blackboxstocks’ operations, financial condition and the value of Blackboxstocks’ common stock.

The Combined Company’s stockholders may from time to time seek to acquire a controlling stake in the Combined Company, engage in proxy solicitations, advance stockholder proposals or otherwise attempt to effect changes. Campaigns by stockholders to effect changes at publicly traded companies are sometimes led by investors seeking to increase short-term stockholder value through actions such as financial restructuring, increased debt, special dividends, stock repurchases or sales of assets or the entire company. Responding to proxy contests and other actions by activist stockholders can be costly and time-consuming and could disrupt the Combined Company’s operations and divert the attention of the Combined Company’s Board of Directors and senior management from the pursuit of the proposed Merger transaction. These actions could adversely affect the Combined Company’s operations, financial condition, ability to consummate the Merger and the value of the Combined Company’s common stock.

The sale or availability for sale of a substantial number of shares of common stock of the Combined Company after the Merger could adversely affect the market price of such shares after the Merger.

Sales of a substantial number of shares of common stock of the Combined Company in the public market after the Merger and other legal restrictions on resale, or the perception that these sales could occur, could adversely affect the market price of such shares and could materially impair the Combined Company’s ability to raise capital through equity offerings in the future. Immediately following the closing of the Merger, the Combined Company will have outstanding approximately [●] shares of common stock, without giving effect to the proposed reverse stock split and excluding securities underlying securities convertible or exercisable into shares of common stock of the Combined Company, based on the assumed Exchange Ratio of [●] and approximately [●] shares of Series C Preferred Stock. This includes the shares being issued to REalloys stockholders as Merger Consideration, which may be resold in the public market immediately without restriction, subject to applicable rules and regulations of the Securities Act and subject to the Lock-Up Agreements (as defined herein) as related to certain prior stockholders of REalloys. Blackboxstocks and REalloys are unable to predict what effect, if any, market sales of securities held by significant stockholders, directors or officers of the Combined Company or the availability of these securities for future sale will have on the market price of the Combined Company’s common stock after the Merger.

If securities analysts do not publish research or reports about the business of the Combined Company, or if they publish negative evaluations, the price of the Combined Company’s common stock could decline.

The trading market for the Combined Company’s common stock will rely in part on the availability of research and reports that third-party industry or financial analysts publish about the Combined Company. Furthermore, if one or more of the analysts who do cover the Combined Company (if any) downgrades its stock, its stock price would likely decline. If one or more of these analysts cease coverage of the Combined Company, the Combined Company could lose visibility in the market, which in turn could cause its stock price to decline. Additionally, if securities analysts publish negative evaluations of competitors in the industry of the Combined Company, the comparative effect could cause the Combined Company’s stock price to decline.

The Combined Company’s management will be required to devote substantial time to comply with public company regulations.

As a public company, the Combined Company will incur significant legal, accounting and other expenses that REalloys did not incur as a private company. The Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), as well as rules implemented by the SEC and Nasdaq, impose various requirements on public companies, including those related to corporate governance practices. The Combined Company’s management and other personnel will need to devote a substantial amount of time to these requirements. Moreover, these rules and regulations will increase the Combined Company’s legal and financial compliance costs relative to those of REalloys and will make some activities more time consuming and costly.

The Sarbanes-Oxley Act requires, among other things, that the Combined Company maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, the Combined Company must perform system and process evaluation and testing of its internal control over financial reporting to allow management and the Combined Company’s independent registered public accounting firm to report on the effectiveness of its internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act (“Section 404”). The Combined Company’s compliance with these requirements will require that it incur substantial accounting and related expenses and expend significant management efforts. The Combined Company will likely need to hire additional accounting and financial staff, including a Chief Financial Officer, to satisfy the ongoing requirements of Section 404. The costs of hiring such staff may be material and there can be no assurance that such staff will be immediately available to the Combined Company. Moreover, if the Combined Company is not able to comply with the requirements of Section 404, or if the Combined Company or its independent registered public accounting firm identifies deficiencies in its internal control over financial reporting that are deemed to be material weaknesses, investors could lose confidence in the accuracy and completeness of the Combined Company’s financial reports, the market price of the Combined Company’s common stock could decline and the Combined Company could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

The Combined Company may not be able to timely and effectively implement controls and procedures required by Section 404 that will be applicable to the Combined Company after the Merger.

REalloys is not currently subject to Section 404. However, following the Merger, the Combined Company will be subject to Section 404. The standards required for a public company under Section 404 are significantly more stringent than those required of REalloys as a privately held company. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that will be applicable to the Combined Company after the Merger. If management is not able to implement the additional requirements of Section 404 in a timely manner or with adequate compliance, it may not be able to assess whether its internal control over financial reporting is effective, which may subject the Combined Company to adverse regulatory consequences and could harm investor confidence and cause the market price of the Combined Company’s common stock to decline.

Subsequent to the consummation of the Merger, the Combined Company may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on its financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.

Although Blackboxstocks and REalloys have conducted due diligence on each other, there can be no assurances that their diligence revealed all material issues that may be present in the other company’s business, that all material issues through a customary amount of due diligence will be uncovered, or that factors outside of Blackboxstocks’ and REalloys’ control will not later arise. As a result, the Combined Company may be forced to later write-down or write-off assets, restructure operations, or incur impairment or other charges that could result in losses. Even if due diligence successfully identifies certain risks, unexpected risks may arise, and previously known risks may materialize in a manner not consistent with each company’s preliminary risk analysis. Even though these charges may be non-cash items and may not have an immediate impact on liquidity, the fact that the Combined Company reports charges of this nature could contribute to negative market perceptions about the Combined Company or its securities. In addition, charges of this nature may make future financing difficult to obtain on favorable terms or at all.

Anti-takeover provisions under Nevada corporate law may make it difficult for the Combined Company stockholders to replace or remove its board of directors and could deter or delay third parties from acquiring the Combined Company, which may be beneficial to the stockholders of the Combined Company.

The Combined Company will be subject to the anti-takeover provisions of Nevada law and the Nevada Revised Statutes (the “NRS”). Sections 78.411 through 78.444 of the NRS regulate business combinations with interested stockholders. Nevada law defines an interested stockholder as a beneficial owner (directly or indirectly) of 10% or more of the voting power of the outstanding shares of the corporation. Pursuant to Sections NRS 78.411 through 78.444, combinations with an interested stockholder remain prohibited for three years after the person became an interested stockholder unless (i) the transaction is approved by the board of directors or the holders of a majority of the outstanding shares not beneficially owned by the interested party, or (ii) the interested stockholder satisfies certain fair value requirements. NRS 78.434 permits a Nevada corporation to opt-out of the statute with appropriate provisions in its articles of incorporation. Pursuant to the terms of the Blackboxstocks Articles, which shall be the governing articles following the Merger, the Combined Company will not to be governed by the terms and provisions of Sections 78.411 through 78.444, inclusive, of the NRS.

NRS Sections 78.378 through 78.3793 regulates the acquisition of a controlling interest in an issuing corporation. An issuing corporation is defined as a Nevada corporation with 200 or more stockholders of record, of which at least 100 stockholders have addresses of record in Nevada and does business in Nevada directly or through an affiliated corporation. NRS Section 78.379 provides that an acquiring person and those acting in association with an acquiring person obtain only such voting rights in the control shares as are conferred by a resolution of the stockholders of the corporation, approved at a special or annual meeting of the stockholders. Stockholders who vote against the voting rights have dissenters’ rights in the event that the stockholders approve voting rights. Section 78.378 provides that a Nevada corporation’s articles of incorporation or bylaws may provide that these sections do not apply to the corporation. Pursuant to the terms of the Blackboxstocks Articles, which shall be the governing articles following the Merger, the Combined Company will not to be governed by the terms and provisions of Sections 78.378 through 78.3793 of the NRS.

Blackboxstocks’ President and Chief Executive Officer currently exercises voting control over our Blackboxstocks and, upon closing of the Merger and the associated transfer of Series A Preferred Stock, will transfer such voting control to Leonard Sternheim who will then assume control over the Combined Company, and such control may be in conflict to your interests.

As of the Blackboxstocks Record Date, Gust Kepler, who serves as a director, President and Chief Executive Officer of Blackboxstocks, owns 598,210 shares of common stock (and has investment authority on an additional 767 shares) representing approximately 16.5% of the issued and outstanding common stock of Blackboxstocks. In addition, Mr. Kepler owns 3,269,998 shares of our Series A Preferred Stock (each of which is entitled to 100 votes on all stockholder matters) representing 100% of the issued and outstanding Series A Preferred Stock, collectively representing approximately 99.1% of the voting power of our stockholders (based upon 3,622,874 shares of common and 3,269,998 shares of Series A Preferred Stock issued and outstanding). After the Merger Mr. Kepler will continue own shares of our outstanding capital stock (including shares of Series A Preferred Stock) representing approximately [●]% of the voting power of our stockholders and will sell to Leonard Sternheim shares of Series A Preferred Stock representing approximately [●]% of the voting power of our stockholders. As a result, Mr. Kepler has been able, and Mr. Sternheim will acquire the right in connection with the Merger, to exercise control over all matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions.

Blackboxstocks is, and the Combined Company will be, a “controlled company” within the meaning of the Nasdaq rules and, as a result, qualifies for, and may elect to rely on, exemptions from certain corporate governance requirements that provide protection to the stockholders of companies that are subject to such corporate governance requirements.

Gust C. Kepler, who serves as a director, President and Chief Executive Officer of Blackboxstocks, beneficially owns all of the issued and outstanding shares of Blackboxstocks Series A Preferred Stock, representing more than 50% of the voting power for the election of members of the Blackboxstocks Board of Directors. Upon consummation of the Merger, it is expected that Leonard Sternheim will acquire 45% of Mr. Kepler’s shares of Series A Preferred Stock. Upon exercise of the Option Agreement, Mr. Sternheim will own 100% of the Series A Preferred Stock. As a result, Blackboxstocks is and the Combined Company will continue to be a “controlled company” within the meaning of the corporate governance standards of the Nasdaq rules. Under these rules, a listed company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain of Nasdaq’s corporate governance requirements.

As a controlled company, the Combined Company may rely on certain exemptions from the Nasdaq standards that may enable us not to comply with certain Nasdaq corporate governance requirements. As a consequence, in the event that the Combined Company elects to rely on certain exemptions from the Nasdaq standards provided to “controlled companies,” Combined Company common stockholders will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the Nasdaq Capital Market.

Blackboxstocks and REalloys do not anticipate that the Combined Company will pay any cash dividends in the foreseeable future.

The current expectation is that the Combined Company will retain its future earnings, if any, to fund the development and growth of the Combined Company’s business. As a result, capital appreciation, if any, of the common stock of the Combined Company will be your sole source of gain, if any, for the foreseeable future.

In the event that the Combined Company fails to satisfy any of the listing requirements of The Nasdaq Capital Market, its common stock may be delisted, which could affect its market price and liquidity.

Following the Merger, the Combined Company’s common stock is expected to be listed on The Nasdaq Capital Market. For continued listing on The Nasdaq Capital Market, the Combined Company will be required to comply with the continued listing requirements, including the minimum market capitalization standard, the corporate governance requirements and the minimum closing bid price requirement, among other requirements. In the event that the Combined Company fails to satisfy any of the listing requirements of The Nasdaq Capital Market, its common stock may be delisted. If the Combined Company is unable to list on The Nasdaq Capital Market, it would likely be more difficult to trade in or obtain accurate quotations as to the market price of the Combined Company’s common stock. If the Combined Company’s securities are delisted from trading on The Nasdaq Capital Market, and the Combined Company is not able to list its securities on another exchange or to have them quoted on Nasdaq, the Combined Company’s securities could be quoted on the OTC Bulletin Board or on the “pink sheets.” As a result, the Combined Company could face significant adverse consequences including:

An active trading market for Combined Company common stock may not develop.

The listing of Combined Company common stock on the Nasdaq Capital Market does not assure that a meaningful, consistent and liquid trading market exists. An active trading market for shares of Combined Company common stock may never develop or be sustained. If an active market for the Combined Company common stock does not develop, it may be difficult for investors to sell their shares either without depressing the market price for the shares or at all.

The Combined Company may acquire businesses or products, or form strategic alliances, in the future, and may not realize the benefits of such acquisitions.

The Combined Company may acquire additional businesses or products, form strategic alliances, or create joint ventures with third parties that it believes will complement or augment its existing business. If the Combined Company acquires businesses with promising markets or technologies, it may not be able to realize the benefit of acquiring such businesses if it is unable to successfully integrate them with its existing operations and company culture. The Combined Company may encounter numerous difficulties in developing, manufacturing, and marketing any new products resulting from a strategic alliance or acquisition that delay or prevent it from realizing their expected benefits or enhancing its business. There is no assurance that, following any such acquisition, the Combined Company will achieve the synergies expected to justify the transaction, which could result in a material adverse effect on the Combined Company’s business and prospects.

Following the Merger, the Combined Company expects to take advantage of reduced disclosure and governance requirements applicable to smaller reporting companies, which could result in the Combined Company’s common stock being less attractive to investors.

Following the Merger, the Combined Company expects to have a public float of less than $250 million and therefore qualify as a smaller reporting company under the rules of the SEC. As a smaller reporting company, we expect to be able to take advantage of reduced disclosure requirements, such as simplified executive compensation disclosures and reduced financial statement disclosure requirements in our future SEC filings. Decreased disclosures in our future SEC filings due to our status as a smaller reporting company may make it harder for investors to analyze our results of operations and financial prospects. We cannot predict if investors will find the Combined Company’s common stock less attractive if we rely on these exemptions. If some investors find the REalloys common stock less attractive as a result, there may be a less active trading market for the Combined Company’s common stock and the stock price may be more volatile. The Combined Company may take advantage of the reporting exemptions applicable to a smaller reporting company until it is no longer a smaller reporting company, which status would end once it has a public float greater than $250 million. In that event, the Combined Company could still be a smaller reporting company if its annual revenues were below $100 million and it has a public float of less than $700 million.

Risks Related to REalloys Prior to the Consummation of the Merger

Unless otherwise indicated, reference in this section, “Risks Related to REalloys Prior to the Consummation of the Merger” and elsewhere in this joint proxy and consent solicitation statement/prospectus to the REalloys business being adversely affected, negatively impacted or harmed will include an adverse effect on, or a negative impact or harm to, the business, reputation, financial condition, results of operations, revenue and future prospects of the Combined Company. References in this section to the “Company,” “we,” “our,” or “us” generally refer to REalloys Inc.

Risks Related to REalloys’ Business and Industry

We are dependent on short term contract work and there are no guarantees that REalloys will receive any additional orders or contracts.

The Euclid Magnet Facility is currently producing rare earth metals and magnet materials for the DLA, the DOE’s AMES National Laboratory and NdFeB magnet industry clients. Contract works are short term in nature, often less than six months, and there are no guarantees that any additional orders will be receive by REalloys after July 2025.

In addition to the short term limited rare earth metals and magnet materials contract works, the Euclid Magnet Facility is under development to significantly increase production of NdFeB magnet materials commencing in the fourth quarter of 2025 to expand to 500 metric tonnes per annum (“mtpa”) magnet materials and magnet production capacity by the second quarter of 2026 and 1,000 mtpa production of magnet materials and magnets by the second quarter of 2027. REalloys has no history of commercial operations at these forecasted volumes and the lack of operating at these forecasted scale limits the accuracy of any forward-looking forecasts, prospects or business outlooks or plans.

REalloys may not be able to secure the necessary feedstock, offtake, or equipment in order to economically produce NdFeB magnet materials and magnets, including from the HLREE.

REalloys is in discussions with the Saskatchewan Research Counsel (“SRC”), located in Saskatoon, Saskatchewan Province, Canada to utilize, on a toll manufacturing basis, their SRC Separation Facilities to process HLREE concentrate and/or third party concentrate and/or light rare earth oxides and/or re-cycled magnets into light rare earth metals and/or heavy rare earth oxides. There can be no assurances that such discussions with the SRC will lead to a definitive agreement. Additionally, there are no assurances that the signing of a definitive agreement will lead to suitable and verified third party sources of rare earth concentrates and/or light rare earth oxides and/or re-cycled magnets and/or heavy rare earth oxides available for process at the SRC Separation Facilities prior to or after HLREE concentrate becomes available. Currently, the SRC Separation Facilities’ expansion to meet the forecasted feedstock requirements of the Euclid Magnet Facility is not scheduled to be commissioned until the second quarter of 2026 and any delays in completion, any capital and operating cost overruns and any quality issues will have an adverse impact on REalloys’ forecasted second quarter 2026 production schedules and financial viability.

REalloys realizes revenue at the Euclid Magnet Facility from contract works, which include the production of a limited amount rare earth metals and magnet materials for and on behalf of its clients. To date, REalloys has yet to realize any revenues from the direct production and/or sale of NdFeB magnet materials and magnet or critical minerals, or rare earth minerals, and its operating and capital investment and cash flow needs have been financed through the issuances of debt and equity raises and not through cash flows derived from its operations. As a result, REalloys has little historical financial and operating information available to help potential investors evaluate its performance. Any profitability in the future from our business will be dependent upon the development of the projects, the award of additional contract works beyond July 2025, and the production of NdFeB magnet materials and magnets, which is subject to numerous risk factors. Accordingly, REalloys may not realize profits, including in the medium to long term. Additional expenditures may be required for working capital purposes, including but not limited to meeting minimum expenditure commitments at the HLREE, constructing, completing and installing additional NdFeB magnet materials and magnet production equipment. Additionally, REalloys’ magnet materials and magnet production capabilities might not be able to fully utilize the nameplate capacity of the equipment.

REalloys also has limited operating history upon which to base estimates of future operating costs and capital requirements. Actual operating costs and economic returns of any and all of REalloys’ projects may materially differ from the costs and returns estimated, and accordingly our financial condition, results of operations and cash flows may be negatively affected. Further, REalloys has no history in operating a business, except for the Euclid Magnet Facility’s contract works, other than pursuing a business combination. In the near term, REalloys’ development and growth depends on its ability to: (i) to extend and source new contract works, (ii) successfully produce magnet materials and magnets at the Euclid Magnet Facility; (iii) secure additional reliable sources of Light Rare Earth Elements (“LREE”) and Heavy Rare Earth Elements (“HREE”) feedstock at prices that are acceptable and attractive to REalloys, (iv) receive processed LREE and HREE materials from the SRC Separation Facilities on acceptable commercial terms and conditions; and (v) secure additional NdFeB magnet materials and magnet customers that are willing and able to purchase REalloys’ magnet materials and magnets at prices that are expected to be profitable for REalloys. Delays in the completion of the expansion of the Euclid Magnet Facility could have a material adverse effect on our business, results of operations and financial condition as well as any delays to the completion and commissioning of the expansion at the SRC Separation Facilities, currently anticipated for the second quarter of 2025.

We may not be able to generate positive cash flows from our expected future business operations. Our long-term success will depend on implementing the business strategy and operational plan of REalloys, as well as our ability to generate revenues, achieve and maintain profitability and develop positive cash flows from our magnet materials and magnet production.

Our ability to continue with development of our business plan to produce and sell NdFeB magnet materials and magnets, to receive LREE and HREE products from the SRC Separation Facilities, and our plans regarding the Euclid Magnet Facility and the HLREE, ultimately depends on our ability to generate revenues, achieve and maintain profitability, and generate positive cash flow from our operations. We cannot assure you that our projects will result in achieving and maintaining profitability and developing positive cash flows. The economic viability of REalloys’ future business activities has many risks and uncertainties including, but not limited to:

REalloys’ future business activities may change because of any one or more of these risks and uncertainties.

We may experience time delays, unforeseen expenses, increased capital costs, and other complications while developing our projects, these could delay the start of revenue-generating activities and increase development costs.

The production of LREE and HREE materials, NdFeB magnet materials and magnets and mineral exploration and mining by nature involve significant risks and hazards, including environmental hazards, as well as industrial and mining accidents. These include, for example, occupational hazards, leaks, ruptures, explosions, chemical spills, seismic events, fires, cave-ins and blockages, flooding, discharges of gasses and toxic substances, contamination of water, air or soil resources, unusual and unexpected rock formation affecting mineralization or wall rock characteristics, ground or slope failures, rock bursts, wildfires, radioactivity and other accidents, incidents, or conditions resulting from mining or manufacturing activities, including, among others, blasting and the transport, storage and handling of hazardous materials. In particular, the production of LREE and HREE materials, NdFeB magnet materials and magnets involves the use of heavy equipment, operations at high temperatures and the use of dangerous chemicals, among others. These operations can be dangerous and safety incidents in these operations may cause damage to and loss of equipment, injury or death, monetary losses and potential legal liabilities. Any such incident could have a material adverse effect on our business, operating results and financial condition.

Furthermore, there is the risk that relevant regulators and others may impose fines and work stoppages for both compliant and non-compliant exploration, production or mining operating procedures and activities, which could reduce or halt exploration, production or mining until lifted. The occurrence of any of these events could delay or halt exploration and production, increase production costs and result in financial and regulatory liability for us, which could have a material adverse effect on our business, results of operations and financial condition. In addition, the relevant environmental authorities have issued and may issue administrative directives and compliance notices in the future, to enforce the provisions of the relevant statutes to take specific anti-pollution measures, continue with those measures and/or to complete those measures. The authorities may also order the suspension of part, or all of, our operations if there is non-compliance with legislation. Contravention of some of these statutes may also constitute a criminal offense and an offender may be liable for a fine or imprisonment, or both, in addition to administrative penalties. As a result, the occurrence of any of these events may have a material adverse effect on our business, results of operations and financial condition. REalloys may also face the risks of tariffs and other restrictions of trade as LREE and HREE materials cross international borders.

We may not be able to reach a definitive agreement with the SRC as regards to the utilization of the SRC Separation Facilities, or achieve terms favorable to us, or at all.

While we are currently in discussions with the SRC as related to the utilization of their SRC Separation Facilities, there can be no assurance that we will reach a definitive agreement with the SRC on favorable terms to REalloys, or at all. If we are unable to negotiate, finalize and maintain such agreement or enter into an alternative arrangement with another toll processing facility and/or satisfy the conditions therein, or if are only able to do so on terms that are unfavorable to us, this will have a negative effect on our supply chain, strategy and current projections, including projections related to future production capabilities. If this happens, our results of operations and financial condition could be materially and adversely affected.

We may not successfully establish or maintain collaborative, joint venture and licensing arrangements, which could adversely affect our ability to vertically integrate into further mid-stream and downstream processing of NdFeB magnet materials and magnets.

A key element of our long-term business strategy is to vertically integrate into further downstream and mid-stream processing of NdFeB magnet materials and magnets. To implement this vertical integration strategy successfully, we are currently negotiating an agreement with the SRC and the use of their SRC Separation Facilities and may seek further strategic arrangement and agreements. We may also need to license certain intellectual property related to these mid-stream and downstream processes and/or develop the ability, or collaborate with, purchase, or form a joint venture with existing participants in the LREEs, HREEs and magnet materials and magnet production supply chain. In addition, other licenses that may be necessary for some of these mid-stream and downstream processing steps have not yet been obtained. Any failure to establish or maintain collaborative, joint venture or licensing arrangements to produce mid-stream and downstream products on favorable terms could adversely affect our business prospects, financial condition or ability to develop and commercialize downstream magnet materials and magnets.

We are dependent directly and indirectly on US government contracts, which often are only partially funded, subject to immediate termination, and heavily regulated and audited as the targeted NdFeB magnet materials and magnet clients of REalloys include direct sale of materials to the US government and to companies reliant on US government contracts. The interruption of or termination or failure to fund, or negative audit findings for, one or more of these contracts could have an adverse impact on our business, financial condition, results of operations and cash flows.

REalloys is aiming to build a secured fully integrated North American high-performance NdFeB magnet materials and magnet supply chain and contract works for the US Protected Markets. Over its lifetime, a US government program may be implemented by the award of many different individual contracts and subcontracts. REalloys’ non-US government clients are also heavy reliant on US government funding. As such, we are subject to both direct and indirect impacts on US government funding and programs. The funding of US government programs is subject to US Congressional appropriations. In recent years, US government appropriations have been affected by larger US government budgetary issues and related legislation. Although multi-year contracts may be authorized and appropriated in connection with major procurements, Congress generally appropriates funds on a government fiscal year basis. Procurement funds are typically made available for obligation over the course of one to three years. Consequently, programs often initially receive only partial funding, and additional funds are obligated only as Congress authorizes further appropriations. We cannot predict the extent to which total funding and/or funding for individual programs will be included, increased or reduced as part of the annual appropriations process ultimately approved by Congress and the President of the United States or in separate supplemental appropriations or continuing resolutions, as applicable. The termination of funding for a US government program would result in a loss of anticipated future revenue attributable to that program, which could have an adverse impact on our operations. In addition, the termination of a program or the failure to commit additional funds to a program that already has been started could result in lost revenue and increase our overall costs of doing business.

Generally, US government contracts are subject to oversight audits by US government representatives. Such audits could result in adjustments to our direct contract costs as well as indirectly by our non-US government clients’ contract costs. Any costs found to be improperly allocated to a specific contract will not be reimbursed, and such costs already reimbursed must be refunded. We have recorded contract revenue based on costs we expect to realize. However, we do not know the outcome of any future audits and adjustments, and we may be required to materially reduce our revenue or profits upon completion and final negotiation of audits. Negative audit findings could also result in termination of a contract, forfeiture of profits, suspension of payments, fines or suspension or debarment from US government contracting or subcontracting for a period of time.

In addition, US government contracts generally contain provisions permitting termination, in whole or in part, without prior notice at the US government’s convenience upon payment only for work done and commitments made at the time of termination. We can give no assurance that one or more of our US government contracts will not be terminated and this also applies to our non-US government clients thar are reliant on US government contracts. Also, we can give no assurance that we would be able to procure new contracts to offset the revenue or backlog lost as a result of any termination of our and/or our non-US government US government contracts. Because a significant portion of our revenue and our non-US government clients’ US government contracts will be dependent on performance and payment under our US government contracts, the loss of one or more large contracts could have a material adverse impact on our business, financial condition, results of operations and cash flows.

Conducting business with the US government is also subject to specific procurement regulations and a variety of socioeconomic and other requirements. These requirements, although customary in US government contracts, will increase our performance and compliance costs. These costs might increase in the future, thereby reducing our margins, which could have an adverse effect on our business, financial condition, results of operations and cash flows.

In addition, the US government has and may continue to implement initiatives focused on efficiencies, affordability and cost growth and other changes to its procurement practices, such as those pursued by the recently created Department of Government Efficiency (“DOGE”). On January 20, 2025, President Trump announced an executive order establishing the DOGE to maximize government efficiency and productivity. In February 2025, President Trump stated that he has directed DOGE to review Pentagon spending for potential waste and fraud. Pressures on and uncertainty surrounding the US federal government’s budget and potential changes in budgetary priorities, could adversely affect our revenue, financial condition, and results of operations. President Trump, through executive orders, as well as at the direction of the US Office Management and Budget, have implemented further US government expenditure cuts and reductions, including but not limited to, repeal of a waiver that expedited the use of DPA Title III funds for the DIB. These initiatives and changes to procurement practices may change the way US government contracts are solicited, negotiated and managed, which may affect whether and how we pursue opportunities to provide our products and services to the US government, including the terms and conditions under which we do so, which may have an adverse impact on our business, financial condition, results of operations and cash flows.

Additionally, on March 20, 2025, President Trump issued an executive order titled “Immediate Measures to Increase Mineral Production,” aimed at accelerating domestic mineral production by expediting permits, prioritizing federal land use and expanding investment opportunities. These measures could adversely impact the development and execution of REalloys North American integrated high-performance NdFeB magnet materials supply chain for the following reasons, including but not limited to:

There could be both tariff and other trade restrictions between the US and/or Canada and/or other countries that might have significant negative impacts on REalloys’ business strategy and negatively impact cash flows.

Changes in US federal policy that affect the geopolitical landscape could give rise to circumstances outside our control that could have negative impacts on our business operations.

Changes in US federal policy that affect the geopolitical landscape could give rise to circumstances outside our control that could have negative impacts on our business operations. For example, during the prior Trump administration, increased tariffs were implemented on goods imported into the US, particularly from China, Canada, and Mexico. On February 1, 2025, the US imposed a 25% tariff on imports from Canada and Mexico, which were subsequently suspended for a period of one month, and a 10% additional tariff on imports from China. Historically, tariffs have led to increased trade and political tensions, between not only the US and China, but also between the US and other countries in the international community. In response to tariffs, other countries have implemented retaliatory tariffs on US goods. Political tensions because of trade policies could reduce trade volume, investment, technological exchange, and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Any changes in political, trade, regulatory, and economic conditions, including, but not limited to, US and China trade policies, could have a material adverse effect on our financial condition or results of operations.

Until the HLREE can satisfy our feedstock needs, if ever, our business is subject to the availability of LREE and HREE oxides, re-cycle magnets, and other mineral feedstock, in quantities and prices that allow REalloys to develop and commercially operate the Euclid Magnet Facility and related production of its products.

William J. Lewis, P.Geo. of Micon International Limited prepared a S-K 1300 Technical Report (“Technical Report”) on HLREE dated December 6, 2024, and we plan to de-risk this project as recommended in the Technical Report while concurrently expanding the capabilities and capacity of the Euclid Magnet Facility. HLREE is at the exploration phase and is not and production and therefore is not able to satisfy the feedstock needs necessary for the development and commercial operation of our Euclid Magnet Facility and may never be able to do so. Unless and until HLREE is capable of satisfying our feedstock needs, we will be required to enter into feedstock supply agreements with third parties. We currently intend on sourcing rare earth feedstocks for the SRC Separation Facilities to process and deliver to the Euclid Magnet Facility from verified third-party sources prior to the development of the HLREE. We are in the process of pursuing feedstock supply and offtake arrangements with potential counterparties to provide adequate sources of feedstock for the purchase of all or substantially all our production from the Euclid Magnet Facility, once operational, on terms favorable to us. Such arrangements may not be able to provide all the feedstock which we may require or at economical or favorable prices to us. If we are unable to secure supply agreements that ensure that all our feedstock needs are met or if we are able to secure such agreements, but the counterparties fail to meet their obligations, we may not achieve our goals. If this happens, our results of operations and financial condition could be materially and adversely affected.

The planned development of the HLREE involves numerous uncertainties that could affect the feasibility or profitability of the project.

The HLREE Technical Report includes a description of risks related to HLREE, which are further described below:

The above risks are only a subset of the overall risks associated with potential development of the HLREE. In addition to the risks stated above, REalloys believes that additional risks are associated with the potential development of HLREE as described in this section.

There is no history of producing minerals from HLREE. The HLREE is an exploration stage property in the early stage of exploration and evaluation. Mine development projects typically require a number of years and significant expenditures during the exploration and development phases before production is possible. The economic feasibility of exploration and development projects is based on many factors, such as the following:

The costs, timing and complexities of exploration, development and construction activities may be increased by the location of HLREE (or other properties that may subsequently be acquired) and demand by other mineral exploration and mining companies. It is common in exploration programs and in development, construction, and mine start-ups to experience unplanned problems and delays. Accordingly, our activities may not result in profitable mining operations, and we may not succeed in establishing mining operations or profitably producing minerals from our projects at all or in a reasonable timeframe.

Mineral operations are subject to market forces outside of our control which could negatively impact us.

The marketability of minerals is affected by numerous factors beyond our control including market fluctuations, government regulations relating to prices, taxes, royalties, allowable production, imports, exports and supply and demand. One or more of these risk elements could have an impact on the costs of our operations and, if significant enough, could impact on our business and financial conditions.

We may be adversely affected by fluctuations in demand for, and prices of, NdFeB magnet materials and magnets and necessary feedstock.

Because our revenue is, and will for the foreseeable future be, derived primarily from the production and sale of NdFeB magnet materials and magnets other than contract works at the Euclid Magnet Facility, changes in demand for, and the market price of, and taxes and other tariffs and fees imposed upon such products and their input could significantly affect our profitability. Our financial results may be significantly adversely affected by declines in the prices of NdFeB magnet materials and magnets or increases in the prices of necessary feedstock. NdFeB magnet materials and magnet prices may fluctuate and are affected by numerous factors beyond our control such as interest rates, exchange rates, taxes, tariffs, inflation or deflation, fluctuation in the relative value of the US dollar against foreign currencies on the world market, shipping and other transportation and logistics costs, global and regional supply and demand for NdFeB magnet materials and magnets, potential industry trends, such as competitor consolidation or other integration methodologies, and the political and economic conditions of countries that produce and procure NdFeB magnet materials and magnets. Furthermore, supply side factors have a significant influence on price volatility for critical and rare earth minerals, necessary feedstock, and NdFeB magnet materials and magnet prices. Supply of rare earth minerals, necessary feedstock, and NdFeB magnet materials and magnets is currently dominated by Chinese producers. The Chinese Central Government regulates production via quotas and environmental standards and has and may continue to change such production quotas and environmental standards. Periods of over supply or speculative trading of critical and rare earth minerals can lead to significant fluctuations in the market price and supply of critical and rare earth minerals and magnets. The Chinese Central Government has also restricted the export of processing equipment for the production of rare earths minerals, magnet materials and magnets and this could have adverse impact on our projects.

In contrast, extended periods of high commodity prices may create economic dislocations that may be destabilizing to critical and rare earth minerals supply and demand and ultimately to the broader markets. While some periods of high critical and rare earth mineral market prices generally are beneficial to our financial performance if we are producing rare earth minerals, if ever, or if magnet materials and magnet prices rise in concert with such higher mineral prices, strong critical and rare earth mineral prices however also create economic pressure to identify or create alternate technologies that ultimately could depress future long-term demand for NdFeB magnet materials and magnets or increase our feedstock costs, and at the same time may incentivize development of competing mining properties.

Additionally, because we are and will be in the future heavily dependent on third parties for feedstock, changes in the demand for, the market price of, or taxes, tariffs, or other fees imposed on such feedstock may affect our ability to acquire our supply needs at an economical price. Changes in the price of feedstock could materially and adversely affect our operations and ultimate financial results.

We may not be able to convert current commercial discussions and/or memorandums of understanding with customers for the sale of our NdFeB magnet materials and magnets and other products into definitive contracts, which may have a negative effect on our business.

REalloys does not currently have any contractually committed customers for the planned output and delivery of NdFeB magnet materials and magnets, except for existing contract works at the Euclid Magnet Facility. We are actively working on an expansion project to increase production from current levels for contract works to 500 mtpa of NdFeB magnet materials and magnets. Our success depends on our ability to generate revenue and operate profitably, which depends in part on our ability to identify target customers and convert such contacts into meaningful orders or expand on current customer relationships. REalloys does not currently have any revenue or definitive off-take or sales agreements with customers in place, except for existing contract works at the Euclid Magnet Facility. Although REalloys is in periodic discussions with potential customers regarding potential offtake agreements, there is no assurance that the parties will be able to reach an agreement or that REalloys will be able to produce and deliver the required NdFeB magnet materials and/or magnets in accordance with the customer’s required specifications and timing requirements. If we are unable to negotiate, finalize and maintain such agreements and satisfy the conditions thereto in order to enter into definitive agreements, or are only able to do so on terms that are unfavorable to us, we will not be able to generate any revenue, which would have a material adverse effect on our business, prospects, operating results and financial condition.

We anticipate that in some cases our products will be delivered to certain customers on an early trial deployment basis, where such customers can evaluate whether our products meet their performance requirements before they commit to meaningful orders of our products. If our targeted customers do not commit to making meaningful orders, or at all, it could adversely affect our business, prospects and results of operations. Our customers may require protections in the form of price reductions and similar arrangements that allow them to require us to deliver additional products or reimburse them for losses they suffer as a result of our late delivery or failure to meet agreed upon specification. Delays in delivery of our products, unexpected performance problems or other events could cause us to fail to meet these contractual commitments, resulting in delays in obtaining the necessary materials used in our production process, defects in material or workmanship or unexpected problems in our manufacturing process, which could lead to unanticipated revenue and earnings losses and financial penalties. The occurrence of any of these events could harm our business, prospects, results of operations and financial results.

Prior to reaching expected production rates at the Euclid Magnet Facility, we intend to enter short- and long-term sales contract works with existing and new customers. However, there can be no assurance that these customers will enter sales contracts for our products. Even if we do enter into offtake and/or sales agreements, we may fail to deliver the product required by such agreements or may experience production costs more than the fixed price to be paid to us under such agreements. The failure to enter such contracts may have a material adverse effect on our financial position and results of operations.

The success of our business will depend, in part, on the growth of existing and emerging uses for NdFeB magnet materials and magnets.

Our strategy is to produce and sell NdFeB magnet materials and magnets, which are used in US Protected Markets, and other existing and emerging technologies, such as, among others, hybrid and electric vehicles, wind turbines, robotics, medical equipment, military equipment and other high-growth, advanced motion technologies. The success of our business accordingly depends on the continued growth of these end markets and successfully commercializing NdFeB magnet materials and magnets, in such markets. If the market for these existing and emerging technologies does not grow as we expect, if it grows more slowly than we expect, or if the demand for our products in these markets decreases, then our business, prospects, financial condition and operating results could be harmed. In addition, the market for these technologies tends to be cyclical, which exposes us to increased volatility, and it is uncertain as to how such macroeconomic factors will impact our business.

A prolonged or significant economic contraction in the United States or worldwide could put downward pressure on market prices of NdFeB magnet materials and magnets. Protracted periods of low prices for NdFeB magnet materials and magnets could significantly reduce revenues and the availability of required development funds in the future. This could cause substantial reductions to, or a suspension of, magnet production operations, impair asset values and reduce our results of operations and financial condition.

Demand for REalloys’ products may be impacted by demand for downstream products incorporating NdFeB magnet materials and magnets, including hybrid and electric vehicles, wind turbines, robotics, medical equipment, military equipment and other high-growth, advanced motion technologies, as well as demand in the general automotive and electronic industries. Lack of growth or changes in these markets may adversely affect the demand for our products. Any unexpected costs or delays in the commercialization of NdFeB magnet materials and magnets or any of our other expected products, or less than expected demand for the critical existing and emerging technologies that use NdFeB magnet materials and magnets, could have a material adverse effect on our financial condition or results of operations.

An increase in the global supply of NdFeB magnet materials and magnets, or dumping, predatory pricing and other tactics by our competitors or state actors may adversely affect our profitability.

The pricing and demand for NdFeB magnet materials and magnets is affected by a number of factors beyond our control, including growth of economic development and the global supply and demand for NdFeB magnet materials and magnets. China is projected to account for a substantial portion of global NdFeB magnet materials and magnet production in the near future. China dominates the manufacture of metals and NdFeB magnet materials and magnets from rare earths, capabilities that are not currently materially present in the United States, and the Chinese Central Government regulates production via quotas and environmental standards. Over the past few years, there has been significant restructuring of the Chinese markets in line with China Central Government policy. If we reach anticipated production rates for NdFeB magnet materials and magnets and other planned downstream products and subsequently become fully operational and integrated, increased competition may lead our competitors to engage in predatory pricing or other behaviors designed to inhibit further downstream integration. Any increase in the amount of NdFeB magnet materials and magnets or related products available in the market, including those exported from other nations would result in increased competition and may result in price reductions, reduced margins or loss of potential market share, any of which could materially adversely affect our profitability. As a result of these factors, we may not be able to compete effectively against current and future competitors.

Industry consolidation may result in increased competition, which could result in a reduction in revenue.

Some of our competitors have made, or may make, acquisitions or enter partnerships or other strategic relationships to achieve competitive advantages. In addition, new entrants not currently considered competitors may enter our market through acquisitions, partnerships, or strategic relationships. We expect these trends to continue as demand for rare earth materials increases. Industry consolidation may result in competitors with more compelling product offerings or greater pricing flexibility than we have, or business practices that make it more difficult for us to compete effectively, including based on price, sales, technology or supply. For example, in December 2021, China merged three state entities to establish the China Rare Earth Group Co. Ltd (“China Rare Earth Group”), that accounts for more than half of China’s heavy rare earths supplies. China Rare Earth Group has enhanced pricing power of key rare earths, such as dysprosium and terbium, which has brought changes to the global rare earth supply chain. These competitive pressures could have a material adverse effect on our business.

Our ability to generate revenue will be diminished if we are unable to compete with substitutions for our rare earth, NdFeB magnet materials and magnets.

Technology changes rapidly in the industries and end markets that utilize our materials. If these industries introduce new technologies or products that no longer require the rare earth materials or NdFeB magnet materials and magnets we produce or may produce in the future, or suitable substitutes become available, this could result in a decline in demand for our rare earth materials or NdFeB magnet materials and magnets. If the demand for our rare earth materials or NdFeB magnet materials and magnets decreases, it will have a material adverse effect on our business and the results of our operations.

The HLREE is at the exploration stage and REalloys has not commenced construction or commission of the mine nor related facilities, and the development of the HLREE into a producing mine is subject to a variety of risks, any number of which may cause the development of the HLREE into a producing mine to not occur, be delayed, or not result in the commercial extraction of minerals.

The area comprising the HLREE might not be able to be commercially mined, and our ongoing exploration programs may not result in the development of profitable commercial mining operations. Few properties or deposits that are explored are ultimately developed into producing mines. Major expenses will be required to complete the HLREE. We may not be able to develop the HLREE into an operating mine and doing so may not result in the commercial extraction of mineral deposits. There are many factors that may result in the HLREE not reaching completion or production, including failure to obtain adequate funding, failure to successfully complete a preliminary feasibility study (“PFS”) or a definitive feasibility study (“DFS”) that indicates that the project could profitably produce rare earth minerals, failure to meet lease related timelines, failure to satisfy other operational risks regarding obtaining adequate power, water, expertise and human resources, failure to obtain and sustain the necessary permits for operations and other aspects of the business of operating the HLREE, failure to produce a HLREE concentrate from mining operations, and failure to be able to technically extract LREE and HREE oxides from HLREE concentrate. We may never reach commercial or profitable production of rare earth minerals. Even if the HLREE is mined, we may not realize profits from our exploration or development activities in the short, medium, or long term. The actual risks that we will face in the future in connection with the HLREE are unknown at this time, but may include:

REalloys’ operates in a highly competitive industry in a high demand and growth environment and additional manufacturing, refining and mining competitors could result in a reduction in revenue.

The rare earth magnet production and critical and rare earth minerals mining and processing markets are capital intensive and competitive. Production of NdFeB magnet materials and magnets, and critical and rare earth minerals is dominated by our Chinese competitors. These competitors may have greater financial resources, as well as other strategic advantages to operate, maintain, improve and possibly expand their facilities. Additionally, our Chinese competitors have historically been able to produce at relatively low costs due to domestic economic and regulatory factors, including less stringent environmental and other governmental regulations and lower labor and benefit costs. For instance, many of our Chinese competitors dispose of the waste material from beneficiation in wet tailings dams, which are significantly less expensive to operate and potentially more harmful to the environment than the dry tailings method that we would expect to employ. Even upon successful completion of our planned business stages and/or projects, if we are not able to achieve our anticipated costs of production, then any strategic advantages that our competitors may have over us, including, without limitation, lower labor, compliance and production costs, could have a material adverse effect on our business.

Some of our competitors have made, or may make, acquisitions or enter partnerships or other strategic relationships to achieve competitive advantages. In addition, new entrants who are not currently considered competitors may enter our market through acquisitions, partnerships or strategic relationships. We expect these trends to continue as demand for NdFeB magnet materials and magnets and critical and rare earth materials increases. Industry consolidation may result in competitors with more compelling product offerings or greater pricing flexibility than we have, or business practices that make it more difficult for us to compete effectively, including based on price, sales, technology or supply. These competitive pressures could have a material adverse effect on our business.

Mineral Resource estimates are based on interpretation and assumptions and could be inaccurate or yield less mineral production under actual conditions than is currently estimated. Any material changes in these estimates could affect the economic viability of the HLREE, our financial condition and ability to be profitable.

The estimates for mineral resources, including those included in the HLREE Technical Reports, are estimates only and no assurance can be given that the anticipated tonnages and grades will be achieved. There are numerous uncertainties inherent in estimating mineral resources, including many factors beyond our control. Such estimation is a subjective process, and the accuracy of any mineral resources estimate is a function of the quantity and quality of available data and of the assumptions made and judgments used in engineering and geological interpretation. In addition, there can be no assurance that mineral recoveries in small scale laboratory tests will be duplicated in larger scale tests under on-site conditions or during production, if any. If our actual mineral resources are less than current estimates or if we fail to develop our mineral resources base through the realization of identified mineralized potential, our results of operations or financial condition may be materially and adversely affected. Evaluation of mineral resources occurs from time to time, and they may change depending on further geological interpretation, drilling results and mineral and magnet prices.

Changes in China’s or the United States’ political environment and policies, including changes in export/import policy may adversely affect our business.

Because all of the current dominance of China in the critical and rare earth minerals industry, the possibility of adverse changes in trade or political relations with China, political instability in China, increases in labor or shipping costs, the occurrence of prolonged adverse weather conditions or a natural disaster such as an earthquake or typhoon, or the outbreak of global pandemic disease, could severely interfere with our industry and would have a material adverse effect on our operations.

Our sales may be adversely affected by the current and future political environment in China and the policies of the China Central Government. China could oversupply our markets in the United States and elsewhere with either cheaper magnet products or rare earth minerals or feedstock. China has historically heavily subsidized its domestic rare earth producers with respect to both rare earth feedstock and magnets. The United States government has called for substantial changes to foreign trade policy with China and has from time to time raised (as well as has proposed to further raise in the future), tariffs on several Chinese goods. China has at times retaliated with increased tariffs on United States goods, or the ban of exports of rare earth technologies and feedstock to other countries such as the United States. While some impacts of Chinese trade policy may be beneficial for our business, any changes in United States trade policy could trigger retaliatory actions by affected countries, including China, resulting in trade wars which could likely result in increased volatility in the prices of rare earth and critical minerals, necessary feedstock, and NdFeB magnet materials and magnets. Furthermore, unless and until these dynamic changes in favor of the increased competitiveness of domestic production, domestic production may not be economically viable in the global marketplace. As we are heavily dependent upon third-party feedstock unless and until the HLREE becomes a producing mine capable of satisfying our feedstock needs, if ever, and as China currently dominates the global supply of rare earth feedstock necessary for the production of NdFeB magnet materials and magnets, any changes in United States and China relations, including through changes in policies by the Chinese government could adversely affect our financial condition and results of operations, including: changes in laws, regulations or the interpretation thereof, confiscatory taxation, governmental royalties, restrictions on currency conversion, imports or sources of supplies, or the expropriation or nationalization of private enterprises.

The production of NdFeB magnet materials and magnets is a capital-intensive business that requires the commitment of substantial resources; if we do not have sufficient capital or other resources necessary to provide for such production, it could negatively impact our business.

NdFeB magnet materials and magnet production require large amounts of capital, and long-term production and processing requires significant capital investment, working capital, and ongoing maintenance expenditure. We expect to materially increase our capital expenditure and working capital requirements to begin production of NdFeB magnet materials and magnets and support the growth of our business and operations. Our business plan is based on, among other things, expectations as to capital expenditures and if we are unable to fund those capital expenditures or the level of necessary capital expenditures increases above our current expectations, we will not achieve the targets set forth in our business plan or be able to develop currently contemplated or future capital projects or be able to continue production at cost-effective levels. We may not be able to raise additional capital (debt or equity) to complete or fund our projects. Furthermore, any such reduction in capital expenditure may cause us to forego some of the benefits of any future increases in commodity prices, as it is generally costly or impossible to resume production immediately or complete a deferred expansionary capital expenditure project once delayed, which may adversely affect our results of operations or financial condition.

The amount of capital required for completion and build-out of the REalloys’ Projects may increase materially from our current estimates, and we expect to raise further funds through equity or debt financing, joint ventures, production sharing arrangements or other means. Consequently, we depend on our ability to successfully access the capital and financial markets. Any inability to access the capital or financial markets may limit our ability to fund our ongoing operations, execute our business plan or pursue investments that we may rely on for future growth.

Until commercial production is achieved by our projects, we will continue to incur operating and investing net cash outflows associated with including, but not limited to, build out and growth of our Euclid Magnet Facility, maintaining and acquiring properties, undertaking ongoing activities, funding the working capital requirements of our contract works and the funding obligations to develop the assets of our projects. We will require additional capital to fund our ongoing operations, complete our Euclid Magnet Facility, potentially invest into expanding production at the SRC Separation Facilities and — in connection with our HLREE — explore and define HREE mineralization and establish any future mining or HREE manufacturing operations. Such additional funding may not be available to us on satisfactory terms, or at all.

In order to finance our future ongoing operations and future capital needs, we will require additional funds through the issuance of additional equity or debt securities. Depending on the type and terms of any financing we pursue, stockholders’ rights and the value of their investment in our shares of common stock could be reduced. Any additional equity financing will dilute shareholdings. If the issuance of new securities results in diminished rights to holders of our common stock, the market price of our common stock could be negatively impacted. New or additional debt financing, if available, may involve restrictions on financing and operating activities. In addition, if we issue secured debt securities, the holders of the debt would have a claim to our assets that would be prior to the rights of stockholders until the debt is paid. Interest on such debt securities would increase costs and negatively impact operating results.

If we are unable to obtain additional financing, as needed, at competitive rates, our ability to fund our current operations and implement our business plan and strategy will be affected, and we would be required to reduce the scope of our operations and scale back our exploration, development and mining programs. There is, however, no guarantee that we will be able to secure any additional funding or be able to secure funding which will provide us with sufficient funds to meet our objectives, which may adversely affect our business and financial position. Certain market disruptions may increase our cost of borrowing or affect our ability to access one or more financial markets. Such market disruptions could result from:

If additional capital is not available in sufficient amounts or on a timely basis, REalloys will experience liquidity problems, and REalloys could face the need to significantly curtail current operations, change our planned business strategies and pursue other remedial measures. Any curtailment of business operations would have a material negative effect on operating results, the value of REalloys’ securities, and REalloys’ ability to continue as a going concern.

Mineral exploration and development and mining are potentially hazardous and subject to conditions or events beyond our control, which could have a material adverse effect on our business or plans.

Mineral exploration, development and mining involve various types of risks and hazards, including, but not limited to the following:

These risks could result in damage to, or destruction of, mineral properties, production equipment, facilities or other properties, personal injury, environmental damage, delays in mining, increased production costs, monetary losses, or possible legal liability. We may not be able to obtain insurance to cover these risks at economically feasible premiums or at all. Insurance against certain environmental risks, including potential liability for pollution or other hazards resulting from the disposal of waste products from production, may be prohibitively expensive or not available. Any losses we incur related to any significant events that are not covered by insurance policies may have a material adverse effect on our business

There will be significant hazards associated with our activities, some of which may not be fully covered by insurance. To the extent we must pay the costs associated with such risks, our business may be negatively affected.

In the course of exploration, development and production of our projects, certain risks, and in particular, unexpected or unusual geological operating conditions including rock bursts, cave-ins, fires, flooding and earthquakes may occur. Such occurrences could result in damage to mineral properties or facilities thereon, personal injury or death, environmental damage to our properties or the properties of others, delays in mining, monetary losses and possible legal liability.

Although we maintain insurance to protect against certain risks in such amounts as we consider being reasonable, our insurance will not cover all of the potential risks associated with our operations. We may also be unable to maintain insurance to cover certain risks at economically feasible premiums. In addition, insurance coverage may not continue to be available or may not be adequate to cover any resulting liability. Should such liabilities arise, they could reduce or eliminate any future profitability and result in increasing costs and a decline in the value of our securities.

Moreover, insurance against risks such as environmental pollution or other hazards as a result of exploration and production is not generally available to companies in the mining industry on acceptable terms. As a result, we may become subject to liability for pollution or other hazards that may not be insured against. Losses from these events may cause us to incur significant costs that could have a material adverse effect upon our financial performance and results of operations.

Any failure by management to manage growth properly could negatively impact our business.

Future growth may place strains on our financial, technical, operational and administrative resources and cause us to rely more on project partners and independent contractors, thus, potentially adversely affecting our financial position and results of operations. We may not be successful in upgrading our technical, operational and administrative resources or increasing our internal resources sufficiently to provide certain of our services currently provided by third parties or which will be necessary in the future. Our inability to achieve or manage growth may materially and adversely affect our business, results of operations and financial condition.

Certain estimates of market opportunity and forecasts of market growth may prove to be inaccurate.

From time to time, we make statements with estimates of the addressable market for our solutions and the rare earth minerals market in general. Market opportunity estimates and growth forecasts, whether obtained from third-party sources or developed internally, are subject to significant uncertainty and are based on assumptions and estimates that may prove to be inaccurate. The estimates and forecasts relating to the size and expected growth of the target market, market demand and adoption, capacity to address this demand and pricing may also prove to be inaccurate. In particular, estimates regarding the current and projected market opportunity are difficult to predict. The estimated addressable market may not materialize for many years, if ever, and even if the markets meet the size estimates and growth forecasts, our business could fail to grow at similar rates.

A power or other utility disruption or shortage at our Projects could temporarily delay operations and increase costs, which may negatively impact our business.

Instability in electrical or other utility supply could cause sporadic outages and brownouts. Any such outages or brownouts could have a negative impact on our production. As a result, our revenue could be adversely impacted and our relationships with our customers could suffer, adversely impacting our ability to generate future revenue and otherwise perform our contractual obligations. In addition, if power to any of our projects is disrupted during certain phases of our production processes, we may incur significant expenses that may adversely affect our business.

Increasing costs, including rising electricity and other utility costs, or limited access to raw materials may adversely affect our profitability.

We use significant amounts of electricity and other utilities, including water, in our operations at our projects and such usage will increase as we increase production. We also use significant amounts of raw materials, whether rare earth feedstock or other raw materials such as chemical reagents used to process rare earth oxides. We will need to purchase utilities and raw materials in the open market and as a result, we could be subject to significant volatility in cost and availability. We may not be able to pass on increased prices of such utilities or raw materials through to our customers in the form of price increases. If the HLREE is not completed, operative, and commercial, we will be wholly reliant on third-party sources for feedstock for NdFeB magnet materials and magnet production which could be costly and damaging to results of operations. A significant increase in the price or decrease in the availability of these utilities or raw materials could materially increase our operating costs and adversely affect our profit margins and production volumes.

Fluctuations in transportation costs or disruptions in transportation services or damage or loss during transport could decrease our competitiveness or impair our ability to deliver products to our customers.

We will need to transport our products to our future customers wherever they may be located. Finding affordable and dependable transportation is important because it allows us to supply customers around the world. Labor disputes, embargos, government restrictions, work stoppages, pandemics, derailments, damage or loss events, adverse weather conditions, other environmental events, changes to rail or ocean freight systems or other events and activities beyond our control could interrupt or limit available transport services, which could result in customer dissatisfaction and loss of sales potential and could materially adversely affect our results of operations.

A shortage of equipment and supplies could adversely affect our ability to operate our business.

We currently do and likely will depend on various supplies and equipment to carry out our activities, and, if warranted, future exploration, development, mining, and processing operations. A shortage of such supplies, equipment or parts could have a material adverse effect on our ability to carry out our planned activities or increase our operating costs and expenses.

We will need to produce our products to exacting specifications in order to provide future customers with a consistently high-quality product. An inability to meet individual customer specifications would negatively impact our business.

Upon the expansion of our Euclid Magnet Facility, we need to produce NdFeB magnet materials and magnets to meet customer needs and specifications and to provide customers with consistently high-quality products and to meet ever-stricter purity requirements. Inability to perfect the NdFeB magnet materials and magnet production process to the level necessary to meet individual customer specifications may have a material adverse effect on our financial condition or results of operations. In addition, customer needs and specifications may change with time. Any delay or failure in developing processes to meet changing customer needs and specifications may have a material adverse effect on our financial condition or results of operations. Additionally, natural disasters could also impact the facilities of our customers, which could have a material adverse effect on our ability to deliver our product to our customers or our customer’s demand for our products.

Diminished access to water may adversely affect our operations.

Any disruption and/or lack of access to water supply at the HLREE, the SRC Separation Facilities and/or the Euclid Magnet Facility or decrease in available water supply may have a material adverse effect on our operations and our financial condition or results of operations. In addition, future regulation or industry best practices may require more complex water reuse and recycling processes, which may increase operating costs.

Work stoppages or similar difficulties, breakdown in labor relations, or a shortage of skilled technicians and engineers could significantly disrupt our operations and reduce our revenues.

A work stoppage by any of the third parties providing services in connection with construction at our projects could significantly delay our projects, especially our Euclid Magnet Facility, and disrupt our operations, reduce our revenues and materially adversely affect our results of operations. Efficient production of critical minerals and rare earth products, NdFeB magnet materials and magnets using modern techniques and equipment requires skilled technicians and engineers. In addition, our optimization and eventual downstream efforts will significantly increase the number of skilled operators, maintenance technicians, engineers and other personnel required to successfully operate our business. In the event that we are unable to hire, train and retain the necessary number of skilled technicians, engineers and other personnel there could be an adverse impact on our labor costs and our ability to reach anticipated production levels in a timely manner, which could have a material adverse effect on our results of operations.

We depend on key personnel for the success of our business. If we fail to retain our key personnel or if we fail to attract additional qualified personnel, we may not be able to achieve our desired level of growth, and our business could suffer.

We highly value and depend on the contributions of our senior management and key personnel, particularly our experts with respect to magnet production. Our success continues to depend largely upon the performance of key officers, employees and consultants who have advanced us to our current stage and contributed to our potential for future growth. The market for qualified talent has become increasingly competitive, with shortages of qualified talent relative to the number of available opportunities being experienced in all the markets where we conduct our operations. The ability to remain competitive by offering higher compensation packages and programs for growth and development of personnel, with a view to retaining existing talent and attracting new talent, has become increasingly important to us and our operations in the current climate. We may not be able to replace our senior management or key personnel (including personnel that are key to magnet materials and magnet production) with persons of equivalent expertise and experience within a reasonable period of time or at all if one or more of our senior management and key personnel are not retained, and we may incur additional expenses to recruit, train and retain additional personnel. Any prolonged inability to retain key individuals, or to attract and retain new talent as we grow, could have a material adverse effect upon our growth potential and prospects. Additionally, we have not purchased any “key-man” insurance for our directors, officers or key employees.

The hiring and retention of a highly qualified Chief Financial Officer (“CFO”) may be necessary for REalloys’ future success.

We do not currently have a CFO. We believe that it is important to the future success of our business to find a qualified individual to be the CFO. We are currently conducting a search for a qualified CFO. The prospective CFO may require key operational expertise in manufacturing or mining, and relationships and reputations that have been established and maintained in order to help REalloys maintain good customer relations, identify new business opportunities, prepare and file financial and other statutory reports as required by regulators and the Nasdaq Capital Market. Identifying and hiring such an individual on terms acceptable to us may take a significant amount of time. Until a qualified CFO is hired, we heavily depend on the services of our senior management team to satisfy the business requirements of such an office. The inability to find, hire, and retain a qualified CFO could impair REalloys’ ability to manage the Company’s business, which could harm our business and operating results.

We could be subject to certain agreements with government entities if REalloys is provided us with certain incentives and favorable financing and contain conditions and obligations, including local investment, job creation, and repayment terms, that, if not complied with, could negatively impact our business or require us to repay that financing or lose access to those incentives.

We could be offered incentives by Saskatchewan, Canada, as well as the State of Ohio in the United States, and the city of Euclid, Ohio, to remain, expand and operate our Projects, especially our Euclid Magnet Facility. These incentives could include cash grants, development financing at favorable terms, certain tax exemptions and rights to participate in government-subsidized jobs programs, among other things. If we do not comply with certain conditions and obligations in any such agreements, the governmental entities may terminate these potential respective agreements under which the incentives are to be provided, potentially resulting in REalloys’ being required to repay certain funds and/or losing access to the applicable incentives and subsidized jobs programs.

Our business may be adversely affected by force majeure events outside our control, including labor unrest, civil disorder, war, subversive activities or sabotage, extreme weather conditions, fires, floods, tornados, explosions or other catastrophes, epidemics or quarantine restrictions.

We may be impacted by natural disasters, wars, health epidemics or pandemics or other events outside of our control. If major disasters such as tornados, earthquakes, wildfires, health epidemics or pandemics, floods or other events occur, or our information system or communications network breaks down or operates improperly, our ability to continue operations at our projects may be seriously damaged, or we may have to stop or delay production and shipment of our products. We may incur expenses or delays relating to such events outside of our control, which could have a material adverse impact on our business, operating results and financial condition.

Our success depends on developing and maintaining relationships with local communities and stakeholders.

Our ongoing and future success depends on developing and maintaining productive relationships with the communities surrounding our projects, including those people who may have rights or may assert rights to certain of our properties and other stakeholders in our operating locations. Local communities and stakeholders may be dissatisfied with our activities or the level of benefits provided, which may result in legal or administrative proceedings, civil unrest, protests, direct action or campaigns against us. Any such occurrence could materially and adversely affect our business, financial condition or results of operations, as well as our ability to commence or continue exploration or mine development activities.

We may face exposure to adverse movements in foreign currency exchange rates.

Our business may expand further internationally and as a result, a significant portion of our revenues, expenses, current assets and current liabilities may be preliminary denominated in foreign currencies, while our financial statements are expressed in US dollars. A decrease in the value of such foreign currencies compared to the US dollar could result in losses in revenues from currency exchange rate fluctuations. To date, we have not hedged against risks associated with foreign exchange rate exposure. Any hedging techniques we may implement in the future may not be successful, and our business, financial condition, and results of operations may be materially adversely affected by exchange rate fluctuations.

Continuing or worsening inflationary pressures and associated changes in monetary policy may result in increases to the cost of our goods, services, personnel and capital, which in turn could cause our capital expenditure and operating costs to rise.

Inflation has been an ongoing concern in the US and Canada since 2021. Ongoing inflationary pressures may result in increases to the costs of our products, services and personnel, which would, in turn, cause our capital expenditures and operating costs to rise. Sustained levels of high inflation could cause the US Federal Reserve and other central banks to increase interest rates, which could have the effects of raising the cost of capital and depressing economic growth, either of which, or the combination thereof, could hurt the financial and operating results of our business and impact our ability to raise capital.

Our business could be impacted by political events, trade and other international disputes, war, and terrorism.

Political events, trade and other international disputes, war, and terrorism could harm or disrupt international commerce and the global economy and could have a material effect on our business as well as our potential customers, suppliers, contract manufacturers, distributors, and other business partners.

Political events, trade and other international disputes, wars, and terrorism can lead to tariffs or trade restrictions, which could adversely impact our business. The resulting increased costs could adversely impact our gross margin and make our products less competitive or reduce demand. Countries could also adopt other measures, such as controls on imports or exports of goods, technology or data, that could adversely impact our operations and supply chain and limit our ability to offer products and services. These measures could require us to take various actions, including changing suppliers or restructuring business relationships. Complying with new or changed trade restrictions is expensive, time-consuming and disruptive to our operations. Such restrictions can be announced with little or no advance notice. If disputes and conflicts escalate in the future, actions by governments in response could be significantly more severe and restrictive and could materially affect our business.

Political unrest, threats, tensions, actions and responses to any social, economic, business, geopolitical, military, terrorism, or acts of war involving key commercial, development or manufacturing markets such as China, Canada, Mexico, Israel, Europe, or other countries or regions could materially impact any international operations we undertake, including procuring supplies from or selling our products into foreign markets. If any of these events or conditions occur, the impact on us, our employees and potential customers is uncertain, particularly if emergency circumstances, armed conflicts or an escalation in political instability or violence disrupts our product development, data or information exchange, payroll or banking operations, product or materials shipping by us or our suppliers and other unanticipated business disruptions, interruptions and limitations in telecommunication services or critical systems or applications reliant on a stable and uninterrupted communications infrastructure.

US and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine. On February 24, 2022, a full-scale military invasion of Ukraine by Russian troops was reported. In response to the military conflict, the United States and other North Atlantic Treaty Organization member states, as well as non-member states, announced targeted economic sanctions on Russia, including certain Russian citizens and enterprises, and the continuation of the conflict may trigger additional economic and other sanctions. The potential impacts of the conflict and related sanctions could include supply chain and logistics disruptions, macro financial impacts resulting from the exclusion of Russian financial institutions from the global banking system, volatility in foreign exchange rates and interest rates, inflationary pressures on raw materials and energy and heightened cybersecurity threats.

In addition, on October 7, 2023, Hamas militants and members of other terrorist organizations infiltrated Israel’s southern border from the Gaza Strip and conducted a series of terror attacks on civilian and military targets. Shortly following the attack, Israel’s security cabinet declared war against Hamas, and Israel launched an aerial bombardment of various targets within the Gaza Strip and then also began ground operations in the Gaza Strip, which remain ongoing. Other terrorist and/or regional organizations have joined the hostilities as well, including Hezbollah in Lebanon, and it is possible that other countries in the Middle East, including Iran, will become further involved in hostilities with Israel, resulting in a further widening of the conflict. The intensity and duration of Israel’s current wars are difficult to predict as are such wars’ implications for the global economy.

Although our business has not been materially impacted by these geopolitical issues, it is impossible to predict the extent to which our operations will be impacted in the short and long term, or the ways in which conflicts may impact our business including the implementation of tariffs between the US and Canada. The extent and duration of military action, sanctions, and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described herein.

A downturn in global economic conditions may materially adversely affect our business and results of operations.

Our business and results of operations are affected by international, national and regional economic conditions. We are unable to predict any disruptions in financial markets, credit availability, and adverse economic conditions throughout the world. Any economic downturn can affect businesses in a number of ways that could result in unfavorable consequences to us. Adverse global economic conditions could negatively affect the prices of our products or may cause our current or potential customers to delay or reduce purchases which could, in turn, result in reductions in sales volumes or prices, materially and adversely affecting results of operations and cash flows. Volatility and disruption of global financial markets could limit our customers’ abilities to obtain adequate financing to maintain operations and proceed with planned or new capital spending initiatives, leading to a reduction in sales volume that could materially and adversely affect results of operations and cash flow. In addition, a decline in our customers’ ability to pay as a result of an economic downturn may lead to increased difficulties in the collection of accounts receivable, higher levels of reserves for doubtful accounts and write-offs of accounts receivable, and higher operating costs as a percentage of revenues.

Unanticipated changes in our income tax rates or exposure to additional tax liabilities may affect our future financial results.

Our future effective income tax rates may be favorably or unfavorably affected by unanticipated changes in the valuation of our deferred tax assets and liabilities or by changes in tax laws or their interpretation. Any proposed changes to US and non-US tax legislation and the ultimate enactment of any of them could have a negative impact on our effective tax rate. Foreign governments may enact tax laws, including in response to guidelines issued by international organizations that could result in further changes to global taxation and materially affect our financial position and results of operations. In addition, we are subject to the continuous examination of our income tax returns by the Internal Revenue Service and other tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes. These continuous examinations may result in unforeseen tax-related liabilities, which may harm our future financial results.

An increasing number of states and foreign jurisdictions have adopted laws or administrative practices that impose new taxes on all or a portion of gross revenue or other similar amounts or impose additional obligations to collect transaction taxes such as sales, consumption, value added or similar taxes. We may not have sufficient lead time to build systems and processes to collect these taxes properly, or at all. Failure to comply with such laws or administrative practices, or a successful assertion by such states or foreign jurisdictions requiring us to collect taxes where we do not, could result in material tax liabilities, including for past sales, as well as penalties and interest.

Risks Related to REalloys’ Legal, Compliance, and Regulations

Our operations at our Projects are subject, or may become subject, to extensive and costly environmental requirements; and current and future laws, regulations and permits impose or may impose significant costs, liabilities or obligations or could limit or prevent our ability to continue our current operations or to undertake new operations.

We are subject, or may be subject in the future, to numerous and detailed, federal, state and local environmental laws, certifications, regulations and permits, including, without limitation, those pertaining to employee health and safety, air emissions, water usage, wastewater and stormwater discharges, air quality standards, greenhouse gas (“GHG”), emissions, water usage and pollution, waste management, plant and wildlife protection, handling and disposal of radioactive substances, remediation of soil and groundwater contamination, land use, reclamation and restoration of properties, the discharge of materials into the environment, procurement of certain materials used in our operations and groundwater quality and availability. These requirements may result in significant costs, liabilities and obligations, impose conditions that are difficult to achieve or otherwise delay, limit or prohibit current or planned operations. These requirements may in the future result in exploration and development in connection with the HLREE being delayed, limited or prevented, and development operations may be curtailed. Failure to comply with these laws, regulations and permits, including as they evolve, may result in the assessment of administrative, civil and criminal penalties, the issuance of injunctions to limit or cease operations, fines, the suspension or revocation of permits and other sanctions or the loss of support from key stakeholders. Pursuant to such requirements, we may also be subject to third-party claims, including for damages to property or injury to persons arising from our operations. Moreover, environmental legislation and regulation, as well as the expectations of stakeholders, are evolving in a manner which may require stricter standards and enforcement, increased fines and penalties for non-compliance, cessation of operations, more stringent environmental assessments, and a heightened degree of responsibility for companies and their officers, directors and employees. Any changes in these laws, regulations or permits (or the interpretation or enforcement thereof) or any sanctions, damages, costs, obligations or liabilities in respect of these matters could have a material adverse effect on our business and/or the results of our operations and financial condition.

Our activities are subject to environmental laws and regulations that may increase our costs of doing business and restrict our operations.

Our activities are subject to environmental regulations in the jurisdiction in which we operate. Environmental legislation generally provides for restrictions and prohibitions on spills, releases or emissions into the air, discharges into water, management of waste, management of hazardous substances, protection of natural resources, antiquities and endangered species and reclamation of lands disturbed by mining operations. Certain types of operations require the submission and approval of environmental impact assessments. Environmental legislation is evolving in a manner involving stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and a heightened degree of responsibility for companies and their officers, directors and employees. Compliance with environmental laws and regulations and future changes in these laws and regulations may require significant capital outlays, cause material changes or delays in our current and planned operations and future activities and reduce the profitability of operations. It is possible that future changes in these laws or regulations could have a significant adverse impact on the projects or some portion of our business, causing us to re-evaluate those activities at that time.

Examples of current US federal laws which may affect our current operations and may impact future business and operations include, but are not limited to, the following:

The validity of our title to the HLREE and future properties may be disputed by others claiming title to all or part of such properties.

The acquisition of title to rare earth properties is a very detailed and time-consuming process. Title to, and the area of, concessions may be disputed. Although we believe we have taken reasonable measures to ensure proper title to our interests in our properties, there is no guarantee that title to any such properties will not be challenged or impaired. Third parties may have valid claims underlying portions of our interests, including prior unregistered liens, agreements, transfers or claims and title may be affected by, among other things, undetected defects. In addition, we may be unable to operate on such properties as permitted or to enforce its rights with respect to such properties.

We will be required to obtain and sustain government permits and approvals to develop and operate the Projects, a process which is often costly and time-consuming. Failure to obtain or retain any necessary permits or approvals for our planned operations may negatively impact our business.

We are required to obtain and renew government permits and approvals for our projects in connection with any exploration and development activities that we may in the future undertake and, prior to mining any mineralization that we discover, we may be required to obtain additional governmental permits and approvals that we do not currently possess or anticipate. Obtaining and renewing any of these governmental permits is a complex, time-consuming and uncertain process involving numerous jurisdictions, multiple government agencies, public hearings and possibly costly undertakings. The timeliness and success of permitting efforts are contingent upon many variables, some of which are not within our control, including the interpretation of approval requirements administered by the applicable government authority as well as the time required for, and the outcome of, any necessary environmental impact assessment.

We may not be able to obtain or renew permits or approvals that are necessary to our planned operations, or we may discover that the cost and time required to obtain or renew such permits and approvals exceeds our expectations. Any unexpected delays, costs or conditions associated with the governmental approval process could delay our planned exploration, development and mining operations, which in turn could materially adversely affect our prospects, revenues and profitability. In addition, our prospects may be adversely affected by the revocation or suspension of permits or by changes in the scope or conditions for use of any permits obtained.

For example, in addition to the permits that we have been issued to date, we are required to obtain other permits and approvals before construction or operations related to zoning, rezoning, construction mining, mineral concentration and chemical manufacturing. To obtain certain permits, we may be required to conduct environmental studies and collect and present data to governmental authorities pertaining to the potential impact of our current and future operations upon the environment and to take steps to avoid or mitigate those impacts. The permitting rules, and interpretation thereof, are complex and have generally become more stringent over time. In some cases, the public (including environmental interest groups) has rights to comment upon, and submit objections to, permit applications and environmental impact statements prepared in connection therewith, and otherwise participate in the permitting process, including challenging the issuance of permits, validity of environmental impact statements and determinations and performance of permitted activities. Accordingly, permits required for our operations, including our projects, may not be issued, maintained, exchanged, amended or renewed in a timely fashion or at all, or may be issued or renewed upon conditions that restrict our ability to conduct our operations economically. Any such failure to obtain, maintain, exchange, amend or renew permits, or other permitting delays or conditions, including in connection with any environmental impact analyses, could have a material adverse effect on our business, results of operations and financial condition.

Private parties, such as environmental organizations and local residents, frequently attempt to intervene in the permitting process to persuade regulators to deny necessary permits or seek to overturn permits that have been issued. These third-party actions can materially increase the costs of and cause delays in the permitting process and could cause us not to proceed with the development or operation of a property. In addition, our ability to successfully obtain key permits and approvals to explore for, develop, operate and expand operations will likely depend on our ability to undertake such activities in a manner consistent with the creation of social and economic benefits in the surrounding communities, which may or may not be required by law. Our ability to obtain permits and approvals and to successfully operate in particular communities may be adversely affected by real or perceived detrimental events associated with our activities.

Our failure to comply with applicable anti-corruption, anti-bribery, anti-money laundering and similar laws and regulations could negatively impact our reputation and results of operations.

The legal and regulatory framework in which we operate is complex, and our governance and compliance policies and processes may not prevent potential breaches of law or accounting or other governance practices. Our operating and ethical codes, among other standards and guidance, may not prevent instances of fraudulent behavior and dishonesty, nor guarantee compliance with legal and regulatory requirements.

We are required to comply with anti-corruption laws and regulations imposed by governments around the world with jurisdiction over our operations, which may include the laws of the other countries (for example, the US Foreign Corrupt Practices Act) where we do business or have a close connection. These laws and regulations may restrict our operations, trade practices, investment decisions and partnering activities. These and other applicable laws prohibit us and our officers, directors, employees and business partners acting on our behalf, including agents, from corruptly offering, promising, authorizing or providing anything of value to “foreign officials” for the purposes of influencing official decisions or obtaining or retaining business or otherwise obtaining favorable treatment. We are subject to the jurisdiction of various governments and regulatory agencies around the world, which may bring our personnel and representatives into contact with “foreign officials” responsible for issuing or renewing permits, licenses or approvals or for enforcing other governmental regulations.

Our failure to successfully comply with these laws and regulations may expose us to reputational harm, as well as significant sanctions, including criminal fines, imprisonment, civil penalties, disgorgement of profits, injunctions and debarment from government contracts, as well as other remedial measures. Investigations of alleged violations can be expensive and disruptive. Compliance, on the other hand, often adds cost and complexity to the permitting process and subsequent operations. We continuously develop and maintain policies and procedures designed to comply with applicable anti-corruption, anti-bribery, anti-money laundering and similar areas. However, there can be no guarantee that our policies and procedures will effectively prevent violations by our employees or business partners acting on our behalf, for which we may be held responsible, and any such violation could adversely affect our reputation, business, results of operations and financial condition.

Our operations at our projects are subject, or may become subject, to environmental, health and safety regulations, which could impose additional costs and compliance requirements, and we may face claims and liability for breaches, or alleged breaches, of such regulations and other applicable laws.

Our operations at our projects are subject to compliance with various environmental, health and safety laws, regulations, permitting requirements and standards.

We are subject to environmental laws, regulations and permits in the various jurisdictions in which we operate. These environmental laws, regulations, and permits present greater risks if we progress our mining operations. Such regulations would include those relating to, among other things, the removal and extraction of natural resources, the emission and discharge of materials into the environment, including plant and wildlife protection, remediation of soil and groundwater contamination, reclamation and closure of properties, including waste storage facilities, groundwater quality and availability, and the handling, storage, transport and disposal of wastes and hazardous materials. Pursuant to such requirements, we may be subject to inspections or reviews by government authorities. Failure to comply with these environmental requirements may expose us to litigation, fines or other sanctions, including the revocation of permits and suspension of operations. We expect to continue to incur significant capital and other compliance costs related to such requirements. These laws, regulations and permits, and the enforcement and interpretation thereof, change frequently and generally have become more stringent over time. If our noncompliance with such regulations were to result in the release of hazardous materials into the environment, such as soil or groundwater, we could be required to remediate such contamination, which could be costly. Moreover, noncompliance could subject us to private claims for property damage or personal injury based on exposure to hazardous materials or unsafe working conditions. In addition, changes in applicable requirements or stricter interpretation of existing requirements may result in costly compliance requirements or otherwise subject us to future liabilities. The occurrence of any of the foregoing, as well as any new environmental, health and safety laws and regulations applicable to our business or stricter interpretation or enforcement of existing laws and regulations, could have a material adverse effect on our business, financial condition and results of operations.

We also could be liable for any environmental contamination at, under or released from our or our predecessors’ currently or formerly owned or operated properties or third-party waste disposal sites. Certain environmental laws impose joint and several strict liabilities for the release of hazardous substances at such properties or sites, without regard to fault or the legality of the original conduct. A generator of waste can be held responsible for contamination resulting from the treatment or disposal of such waste at any off-site location (such as a landfill), regardless of whether the generator arranged for the treatment or disposal of the waste in compliance with applicable laws. Costs associated with liability for removal or remediation of contamination or damage to natural resources could be substantial and liability under these laws may attach without regard to whether the responsible party knew of, or was responsible for, the presence of the contaminants. Accordingly, we may be held responsible for more than our share of the contamination or other damage, up to and including the entire amount of such damage. In addition to potentially significant investigation and remediation costs, such matters can give rise to claims from governmental authorities and other third parties, including orders, inspections, fines or penalties, natural resource damage, personal injury, property damage, toxic torts and other damages. Our costs, liabilities and obligations relating to environmental matters could have a material adverse effect on our business, financial position and results of operations.

Additionally, due to the nature of our operations, our employees and contractors are exposed to varying degrees of risk in the workplace. These risks may include exposure to dangerous situations, machinery or materials and/or health hazards and have the potential to result in disease, personal injury or death. We are subject to laws and regulations concerning the health, safety and security of our employees (including third-party personnel) working at sites and persons who are not employed by us but may be directly affected by our operations under our management and, accordingly, must implement adequate health and safety systems and procedures. Health and safety incidents can result in loss of life, losses and liabilities, work stoppages, serious damage to equipment or property or environmental damage. These risks can, singularly or in combination, have a material effect on our reputation, results of operations and financial condition. In the event of disease, injury or death arising out of the negligence of an employer or its employees, a risk of civil and, in certain circumstances, criminal litigation exists. In the case of a work-related fatality, an employer may be subjected to criminal charges in a court of law. Furthermore, such incidents can result in citations for violation of various health and safety laws and regulations that could have a material adverse effect on our results of operations, financial condition and/or prospects.

The impact of climate change may adversely affect our operations and/or result in increased costs to comply with changes in regulations.

Climate change is an international and community concern which may directly or indirectly affect our business and current and future activities. The continuing rise in global average temperatures has created varying changes to regional climates across the world and extreme weather events have the potential to delay or hinder our exploration activities at our mineral projects, and to delay or cease operations at any future mine. This may require us to make additional expenditures to mitigate the impact of such events, which may materially and adversely increase our costs and/or reduce production at a future mine. Governments at all levels are amending or enacting additional legislation to address climate change by regulating, among other things, carbon emissions and energy efficiency, or where legislation has already been enacted, regulation regarding emission levels and energy efficiency are becoming more stringent. As a significant emitter of greenhouse gas emissions, the mining industry is particularly exposed to such laws and regulations. Compliance with such legislation and regulations, including the associated costs, may have a material adverse effect on our business, financial condition, results of operations, prospects and our ability to commence or continue our exploration and future development and mining operations.

Changing climate patterns may also affect the availability of water. If the effects of climate change cause prolonged disruption in the delivery of essential commodities, then production efficiency may be reduced, which may have a material adverse effect on our business, financial condition, results of operations and prospects.

In addition, climate change is perceived as a threat to communities and governments globally and stakeholders may demand reductions in emissions or call upon companies to better manage their consumption of climate-relevant resources. A number of governments have already introduced or are moving to introduce climate change legislation and treaties at the international, national, state/provincial and local levels. Regulations relating to emission levels (such as carbon taxes) and energy efficiency are becoming more stringent. If the current regulatory trend continues, this may result in increased costs at the HLREE.

Regulations and pending legislation governing issues involving climate change could result in increased operating costs that could have a material adverse effect on our business.

Several governments or governmental bodies have adopted or are contemplating regulatory changes in response to the potential impact of climate change. In the US, on December 15, 2009, the EPA published its findings that emissions of carbon dioxide, methane and other GHGs present an endangerment to public health and the environment because emissions of such gases are, according to the EPA, contributing to the warming of the earth’s atmosphere and other climate changes. Based on these findings, the EPA has developed and implemented regulations that restrict GHG emissions under existing provisions of the CAA, including one rule that limits GHG emissions from motor vehicles beginning with the 2012 model year. The EPA has asserted that these final motor vehicle GHG emission standards trigger the CAA construction and operating permit requirements for stationary sources, commencing when the motor vehicle standards took effect on January 2, 2011. On June 3, 2010, the EPA published its final rule to address the permitting of GHG emissions from stationary sources under the Prevention of Significant Deterioration (“PSD”) and Title V permitting programs. This rule “tailored” these permitting programs to apply to certain stationary sources of GHG emissions in a multi-step process, with the largest sources first subject to permitting. However, based on a decision of the US Supreme Court, only facilities already required to obtain PSD permits for other criteria pollutants must also reduce GHG emissions that exceed certain thresholds consistent with guidance for determining “best available control technology” standards for GHG, which guidance was published by the EPA in November 2010.

In addition, both houses of Congress have considered legislation to reduce GHG emissions and many states have already taken legal measures to reduce GHG emissions, primarily through the development of GHG inventories, GHG emission fees, GHG permitting and/or regional GHG “cap and trade” programs. Most of these “cap and trade” programs work by requiring major sources of emissions to acquire and surrender emission allowances, with the number of allowances available for purchase reduced each year until the overall GHG emission-reduction goal is achieved.

Legislation and increased regulation regarding climate change could impose significant costs on us and/or our suppliers, including costs related to increased energy requirements, capital equipment, environmental monitoring, and reporting and/or other costs to comply with such regulations. Any adopted future climate change regulations could also negatively impact our ability to compete with companies situated in areas not subject to such regulations. Alternatively, climate change legislation could potentially benefit our business by driving demand for products utilizing rare earth containing products. We cannot predict how legislation and regulation will affect our financial condition, operating performance, or ability to compete. Even without such regulations, increased awareness, or any adverse publicity in the global marketplace about the rare earth industry’s potential impacts on the environment could harm our reputation and business. The potential physical impacts of climate change on our operations are highly uncertain and would be particular to the geographic circumstances in the areas in which we operate. These may include changes in precipitation, storm patterns and intensities, water shortages and changing temperatures. These factors may have an adverse impact on the cost, production, or financial performance of our operation

We are exposed to possible litigation risks, including permit disputes (including in respect of access and/or validity of tenure), environmental claims, occupational health and safety claims and employee claims. Further, we may be involved in disputes with other parties in the future that may result in litigation. Current or future litigation or administrative proceedings could have a negative impact on our business.

We may become involved in, named as a party to, or be the subject of, various legal proceedings, including regulatory proceedings, tax proceedings and legal actions, relating to personal injuries, property damage, property taxes, land rights, the environment and contract disputes.

The outcome of outstanding, pending or future proceedings cannot be predicted with certainty and may be determined adversely to us and as a result, could have a material adverse effect on our assets, liabilities, business, financial condition or results of operations. Even if we prevail in any such legal proceeding, the proceedings could be costly, time-consuming and may divert the attention of management and key personnel from our business operations, which could adversely affect our financial condition.

If we take federal monies, we could become subject to federal regulations. This could delay timing and increase costs.

To date, we have not accepted any federal grants other than existing contract works at the Euclid Magnet Facility. The acceptance of federal monies makes REalloys and its operations subject to continued compliance with various federal regulations. The imposition of any additional federal regulations as a result of accepting any federal monies could delay the timing of the expected completion of our projects and increase our costs. Any such delays or increased costs could harm our business and operations.

Risks Related to REalloys’ Intellectual Property and Technology

Our business may be harmed if we fail to properly protect our intellectual property.

We believe that the success of our business depends, in part, on our proprietary technology, information, algorithms, processes and know-how. We will rely on statutory copyright, trademark, patent and trade secret laws, client license agreements, employee and third-party nondisclosure agreements and other methods to protect our proprietary rights. Nevertheless, these resources afford only limited protection and the actions we take to protect our intellectual property rights both in the United States and abroad may not be adequate. We cannot assure you that we have secured, or will be able to secure, appropriate or adequate protection for all our proprietary rights. In particular, third parties may infringe or misappropriate our proprietary technologies or other intellectual property rights, and our trade secrets may be vulnerable to disclosure or misappropriation by employees, contractors and other persons, which could have a material adverse effect on our business, financial condition and results of operations. Various parties may challenge, invalidate or circumvent our patents, trademarks and other intellectual property rights. Claims allowed on any current or future patents may not be sufficiently broad to protect our technology. Effective patent, copyright and trade secret protection may be unavailable or limited in some of the markets in which we operate, and our trade secrets may be vulnerable to disclosure or misappropriation by employees, contractors and other persons. In addition, litigation may be necessary to enforce our intellectual property rights, protect our trade secrets or determine the validity and scope of the proprietary rights of others. The outcome of any such litigation may not be in our favor, and any such litigation may be costly and may divert management attention as well as other resources away from our business. An adverse determination in any such litigation may impair our intellectual property rights and may harm our business, prospects and reputation. The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition and results of operations.

If we infringe, or are accused of infringing, the intellectual property rights of third parties, it may increase our costs or prevent us from being able to commercialize new products.

There is a risk that we may infringe, or may be accused of infringing, the proprietary rights of third parties under patents and pending patent applications belonging to third parties that may exist in the United States and elsewhere in the world that relate to our rare earth products and processes. Because the patent application process can take several years to complete, there may be currently pending applications that may later result in issued patents that cover our products and processes. In addition, our products and processes may infringe existing patents.

Defending ourselves against third-party claims, including litigation, would be costly and time-consuming and would divert management’s attention from our business, which could lead to delays in the completion of our projects and our downstream expansion plans. If third parties are successful in their claims, we might have to pay substantial damages or take other actions that are averse to our business. As a result of intellectual property infringement claims, or to avoid potential claims, we might:

In addition, we could be subject to claims that our employees, or we, have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of third parties.

If we are unable to resolve claims that may be brought against us by third parties related to their intellectual property rights on terms acceptable to us, we may be precluded from offering some of our products or using some of our processes.

We may not be able to adequately protect our intellectual property rights. If we fail to adequately enforce or defend our intellectual property rights, our business may be harmed.

Much of the technology used in the markets in which we compete is protected by patents and trade secrets, and our commercial success will depend in significant part on our ability to obtain and maintain patent and trade secret protection for our products and methods. To compete in these markets, we rely or may rely on a combination of trade secret protection, nondisclosure and licensing agreements, patents and trademarks to establish and protect our proprietary intellectual property rights, including our proprietary rare earth oxide and magnet production processes that are not currently patented. Our intellectual property rights may be challenged or infringed upon by third parties or we may be unable to maintain, renew or enter into new license agreements with third-party owners of intellectual property on reasonable terms. In addition, our intellectual property may be subject to infringement or other unauthorized use outside of the United States. In such case, our ability to protect our intellectual property rights by legal recourse or otherwise may be limited, particularly in countries where laws or enforcement practices are undeveloped or do not recognize or protect intellectual property rights to the same extent as the United States. Unauthorized use of our intellectual property rights or our inability to preserve existing intellectual property rights could adversely impact our competitive position and results of operations. The loss of our patents, if and once received, could reduce the value of the related products. In addition, the cost to litigate infringements of our patents (if and once received) or other intellectual property, or the cost to defend ourselves against patent or other intellectual policy infringement actions by others, could be substantial and, if incurred, could materially affect our business and financial condition.

Proprietary trade secrets and unpatented know-how are also very important to our business. We rely on trade secrets to protect certain aspects of our technology, especially where we do not believe that patent protection is appropriate or obtainable. However, trade secrets are difficult to protect. Our employees, consultants, contractors, outside scientific collaborators and other advisors may unintentionally or willfully disclose our confidential information to competitors, and confidentiality agreements may not provide an adequate remedy in the event of unauthorized disclosure of confidential or proprietary information. Enforcing a claim that a third party illegally obtained and is using our trade secrets is expensive and time consuming, and the outcome is unpredictable. Moreover, our competitors may independently develop equivalent knowledge, methods and know-how. Failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

Our failure to secure trademark registrations could adversely affect our ability to market our products and operate our business.

Any future trademark applications in the United States and any other jurisdictions where we may file may not be allowed registration, and we may not be able to maintain or enforce our registered trademarks. During trademark registration proceedings, we may receive rejections. Although we are given an opportunity to respond to those rejections, we may be unable to overcome such rejections. In addition, in the USPTO and in corresponding foreign agencies, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks. Opposition or cancellation proceedings may be filed against our applications and/or registrations, and our applications and/or registrations may not survive such proceedings. Failure to secure such trademark registrations in the United States and in foreign jurisdictions could adversely affect our ability to market our products and our business.

We may be subject to claims that our employees have wrongfully used or disclosed alleged trade secrets of their former employers.

As is common in our industry, we may employ individuals who were previously employed at other companies similar to ours, including our competitors or potential competitors. We may become subject to claims that these employees or we have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former employers. Litigation may be necessary to defend against these claims. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management.

Obtaining and maintaining patent protection depends on compliance with various procedures and other requirements, and our patent protection could be reduced or eliminated in case of non-compliance with these requirements.

Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or applications will be due to the relevant patent agencies in several stages over the lifetime of the patents and /or applications. The relevant patent agencies require compliance with a number of procedurals, documentary, fee payment and other provisions during the patent application process. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are situations in which failure to comply with the relevant requirements can result in the abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, our competitors might be able to use our technologies and know-how which could have a material adverse effect on our business, prospects, financial condition and results of operation.

Patent terms may be inadequate to protect our competitive position on our products for an adequate amount of time.

Patents have a limited lifespan. In the United States, if all maintenance fees are timely paid, the natural expiration of a patent is generally 20 years from its earliest US non-provisional filing date. Various extensions may be available, but the life of a patent, and the protection it affords, is limited. Even if patents covering our products are obtained, once the patent life has expired for a product, we may be open to competition from competitive products. Given the amount of time required for the development, testing and regulatory review of new products, patents protecting such products might expire before or shortly after such products are commercialized. As a result, our patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.

We may be subject to claims challenging the inventorship of our patents and other intellectual property.

We may be subject to claims that former employees, collaborators or other third parties have an interest in our patents or other intellectual property, such as an inventor or co-inventor or an author. For example, we may have inventorship or ownership disputes arise from conflicting obligations of consultants or others who are involved in developing our products. Litigation may be necessary to defend against these and other claims challenging inventorship or our ownership of our patents or other intellectual property. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as exclusive ownership of, or the right to use, valuable intellectual property. Such an outcome could have a material adverse effect on our business. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

If our information technology systems, or those of third parties upon which we rely, or our data are or were compromised, we could experience adverse consequences resulting from such compromise, including regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse consequences.

In the ordinary course of business, we collect, receive, store, process, generate, use, transfer, disclose, make accessible, protect, secure, dispose of, transmit, and share sensitive information, including proprietary and confidential business data, trade secrets, intellectual property, sensitive third-party data and personal data with respect to our employees (collectively, “sensitive data”).

Our and our third-party vendors’ and business partners’ information technology systems may be damaged or compromised by malicious events, such as cyberattacks, physical or electronic security breaches, malicious internet-based activity, online and offline fraud, natural disasters, fire, power loss, performance failures in key software platforms, telecommunications failures, personnel misconduct and human error.

Such threats are prevalent and continue to rise, are increasingly difficult to detect, and come from a variety of sources, including internal bad actors, such as employees or contractors (through theft or misuse), or third parties (including traditional computer hackers, “hacktivists,” persons involved with organized crime, or sophisticated foreign state or foreign state-supported actors).

Cybersecurity threats can employ a wide variety of methods and techniques, which are constantly evolving, and have become increasingly complex and sophisticated; all of which increase the difficulty of detecting and successfully defending against them. We and the third parties upon which we rely are subject to a variety of these evolving threats, including social-engineering attacks (including through deep fakes, which may be increasingly more difficult to identify as fake, and 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), credential harvesting, 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, earthquakes, fires, floods, and other similar threats. In particular, severe ransomware attacks are becoming increasingly prevalent - particularly for companies like ours that are engaged in critical infrastructure or manufacturing - and can lead to significant interruptions in our operations, loss of sensitive data 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. Furthermore, because the techniques used to obtain unauthorized access or sabotage systems change frequently and generally are not identified until after they are launched against a target, we and our third-party vendors and business partners may be unable to anticipate these techniques or implement adequate preventative measures.

Remote work has become more common and has increased risks to our information technology systems and data, as more of our employees utilize network connections, computers, and devices outside our premises or network, including working at home, while in transit and in public locations. Additionally, 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. Furthermore, we may discover security issues that were not found during due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program.

We rely on third-party service providers and technologies to operate certain business systems to process sensitive information in a variety of contexts, including cloud-based infrastructure, data center facilities, encryption and authentication technology, and other functions. We also rely on third-party service providers to provide other products, services, parts, or otherwise to operate our business. 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. Certain of the third parties on which we rely have in the past, and may in the future, experience cybersecurity incidents. We could experience adverse consequences resulting from any security incidents or other interruptions experienced by third-party service providers. Any damages award if our third-party service providers fail to satisfy their privacy or security-related obligations to us may be insufficient to cover our damages, or we may be unable to recover such award, and our reputation could be harmed.

We, and the third-party business partners and vendors upon which we rely, may in the future experience cybersecurity threats, including threats or attempts to disrupt our information technology infrastructure and unauthorized attempts to gain access to sensitive or confidential information. Future cyberattacks may have a material impact on our business or financial results. The security measures we have, or may in the future, have to protect our information and our customers’ information and to prevent data loss and other security incidents may not be successful. Security incidents could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration, encryption, disclosure of, or access to our sensitive information or our information technology systems, or those of the third parties upon whom we rely. A security incident or other interruption could disrupt our ability (and that of third parties upon whom we rely) to provide our products and services.

We may expend significant resources or modify our business activities to try to protect against security incidents. Certain data privacy and security obligations may require us to implement and maintain specific security measures or industry-standard or reasonable security measures to protect our information technology systems and sensitive information. We may not be able to detect and remediate all vulnerabilities because the threats and techniques used to exploit vulnerability change frequently and are often sophisticated in nature. Therefore, such vulnerabilities could be exploited but may not be detected until after a security incident has occurred. These vulnerabilities pose material risks to our business. 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 provide notice of data security incidents involving certain types of data, including personal data. Such disclosures are costly, and the disclosure or the failure to comply with such requirements could lead to adverse consequences.

Actual or perceived breaches of security measures, unauthorized access to our system or the systems of the third-party vendors that we rely upon, or any other cybersecurity threats may cause us to experience adverse consequences, such as 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. A security incident involving our software or information technology infrastructure could permit a malicious third party to gain access, via our systems, to the public or private energy grids our systems are connected to or to critical energy, datacenter, or other mission critical infrastructure in the United States and abroad, which could result in severe damage, malfunction, or complete termination of the impacted infrastructure and operations of third parties. Security incidents and attendant consequences may cause customers to stop using our products and services, deter new customers from using our products and services, and negatively impact our ability to grow and operate our business. Security incidents may have further impacts on third parties that are connected to our systems, including public and private entities and entities providing critical services.

We are dependent upon information technology systems, which are subject to cyber threats, disruption, damage and failure. Any unauthorized access to, disclosure, or theft of personal information we gather, store, or use could harm our reputation and subject us to claims or litigation. Further, a failure of our information technology and data security infrastructure could adversely affect our business and operations.

We maintain information necessary to conduct our business, including confidential and proprietary information as well as personal information regarding our customers and employees, in digital form. We also use computer systems to deliver our products and services and operate our businesses. Data maintained in digital form is subject to the risk of unauthorized access, modification, exfiltration, destruction or denial of access and our computer systems are subject to cyberattacks that may result in disruptions in service. We use many third-party systems and software, which are also subject to supply chain and other cyberattacks. We attempt to develop and maintain information security programs to identify and mitigate cyber risks, but the development and maintenance of these programs is costly and requires ongoing monitoring and updating as technological changes and efforts to overcome security measures become more sophisticated. Accordingly, despite our efforts, the risk of unauthorized access, modification, exfiltration, destruction or denial of access with respect to data or systems and other cybersecurity attacks cannot be eliminated entirely, and the risks associated with a potentially material incident remain. In addition, we provide some confidential, proprietary and personal information to third parties in certain cases when it is necessary to pursue business objectives. While we obtain assurances that these third parties will protect this information and, where we believe appropriate, monitor the protections employed by these third parties, there is a risk the confidentiality of data held by third parties may be compromised.

If our information or cyber security systems or data are compromised in a material way, our ability to conduct our business may be impaired, we may lose profitable opportunities or the value of those opportunities may be diminished and, as described above, we may lose revenue as a result of unlicensed use of our intellectual property. If personal information of our customers or employees is misappropriated, our reputation with our customers and employees may be damaged, resulting in loss of business or morale, and we may incur costs to remediate possible harm to our customers and employees or damages arising from litigation and/or to pay fines or take other action with respect to judicial or regulatory actions arising out of the incident. Insurance we obtain may not cover losses or damage associated with such attacks or events.

We rely on various information technology systems. These systems remain vulnerable to disruption, damage or failure from a variety of sources, including, but not limited to, errors by employees or contractors, computer viruses, cyberattacks, including phishing, ransomware, and similar malware, misappropriation of data by outside parties, and various other threats. Techniques used to obtain unauthorized access to or sabotage our systems are under continuous and rapid evolution, and we may be unable to detect efforts to disrupt our data and systems in advance. Breaches and unauthorized access carry the potential to cause losses of assets or production, operational delays, equipment failure that could cause other risks to be realized, inaccurate recordkeeping, or disclosure of confidential information, any of which could result in financial losses and regulatory or legal exposure and could have a material adverse effect on our business, financial condition or results of operations. We may incur material losses relating to cyberattacks or other information security breaches in the future. Our risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As such threats continue to evolve, we may be required to expend additional resources to modify or enhance any protective measures or to investigate and remediate any security vulnerabilities.

We expect to enjoy only limited geographical protection with respect to certain patents and we may not be able to protect our intellectual property rights throughout the world.

Filing, prosecuting and defending appropriate patents in all countries throughout the world would be prohibitively expensive. Competitors may use our and our licensors’ technologies in jurisdictions where we would not have obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we and our licensors have patent protection, but enforcement is not as strong as that in the United States or the EU. These products may compete with our products and/or technology, and our and our licensors’ patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

In addition, we may decide to abandon national and regional patent applications before grant. The grant proceeding of each national or regional patent is an independent proceeding which may lead to situations in which applications might in some jurisdictions be refused by the relevant patent offices, while granted by others. It is also quite common that depending on the country, the scope of patent protection may vary for the same product candidate or technology.

The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws or rules and regulations in the United States and the EU, and many companies have encountered significant difficulties in protecting and defending such rights in such jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in other jurisdictions, whether or not successful, could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing, and could provoke third parties to assert claims against us.

We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. Furthermore, while we intend to protect our intellectual property rights in our expected significant markets, we cannot ensure that we will be able to initiate or maintain similar efforts in all jurisdictions in which we may wish to market our product candidates. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate, which may have an adverse effect on our ability to successfully commercialize our product candidates in all of our expected significant foreign markets. If we or our licensors encounter difficulties in protecting, or are otherwise precluded from effectively protecting, the intellectual property rights important for our business in such jurisdictions, the value of these rights may be diminished, and we may face additional competition from others in those jurisdictions.

Some countries also have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, some countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent. If we or any of our licensors is forced to grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired.

Risks Related to REalloys’ Financial Condition, Indebtedness and Securities

REalloys has a history of losses, and we expect to continue to incur losses and may not achieve or maintain profitability.

For the period ended December 31, 2024, we had a net loss of approximately $5.4 million and no revenues. As of December 31, 2024, we had an accumulated deficit of approximately $5.2 million. We expect to incur losses for at least the next year, as we continue to incur expenses related to the Euclid Magnet Facility and the HLREE. We may not be able to generate sufficient revenues to cover our expenses and achieve profitability or be able to maintain profitability.

Since its inception, REalloys’ has generated negative operating cash flows and we may experience negative cash flow from operations in the future. Our consolidated financial statements have been prepared on a going concern basis.

Since its inception, REalloys has generated negative operating cash flows and may experience negative cash flow from operations in the future. Our consolidated financial statements have been prepared on a going-concerned basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business. Our independent registered public accounting firm has included in its report for the period ended December 31, 2024, an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is contingent upon other factors, our ability to achieve our revenue forecasts and our ability to raise additional capital through sales of our securities, including this offering, and incurrence of debt, as needed to fund future growth. Our future operations are dependent upon the identification and successful completion of equity or debt financing and the continued achievement of profitable operations at an indeterminate time in the future. We may not be successful in completing equity or debt financing or in achieving profitability. The financial statements do not give effect to any adjustments relating to the carrying values and classifications of assets and liabilities that would be necessary should we be unable to continue as a going concern.

REalloys will need to raise additional capital to finance its losses and negative cash flows from operations and may continue to be dependent on additional capital raising if our operations do not reach commercial profitability. There are no assurances that REalloys would be able to raise additional capital on terms favorable to it. If REalloys is unsuccessful in manufacturing its products and raising capital, it will need to reduce activities, curtail, or cease operations. 

We may be unable to raise additional capital, which could harm our ability to compete.

We have in the past and expect in the future to expend significant capital for our ongoing operations. We may be required to raise additional capital over the next few years. We may consume available resources more rapidly than anticipated and we may not be able to raise additional funds when needed or on acceptable terms.

If we raise additional funds through issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our common stock. While our management team believes that REalloys can continue raising additional equity capital to continue in operational existence for the foreseeable future, if we are unable to obtain adequate financing or financing on terms satisfactory to us, when we require it, our ability to continue to pursue our business objectives and to respond to business opportunities, challenges, or unforeseen circumstances could be significantly limited, and our business, operating results, financial condition, and prospects could be materially adversely affected.

The Series X Preferred Stock provides for the payment of dividends in cash or in shares of REalloys’ common stock, and we may not be permitted to pay such dividends in cash, which will require us to have shares of common stock available to pay the dividends.

The holders of the Series X Preferred Stock are entitled to dividends of 8.0% per annum, compounded each calendar quarter, which are payable in arrears quarterly on the Maturity Date (as defined in the Certificate of Designations of the Series X Preferred Stock (the “Series X Certificate of Designations”)) in cash, “in kind” in the form of additional shares of Series X Preferred Stock, or in a combination thereof, at the holder’s discretion. Upon the occurrence and during the continuance of a Triggering Event (as defined in the Series X Certificate of Designations), the Series X Stock accrues dividends at a rate of 15% per annum.

As such, it is possible that we will not have sufficient available shares to pay the dividend in common stock, which would require the payment of the dividend in cash. We will not be permitted to pay the dividend in cash unless we are legally permitted to do so under Nevada law, which requires cash to be available from surplus or net profits neither of which we currently have available.

Our Series X Preferred Stock contains certain customary covenants as well as financial and non-financial covenants, and instances of non-compliance may lead to the declaration of certain triggering events, which could increase our dividend payment obligations and mandatory redemption, among others.

The Series X Preferred Stock contains customary covenants as well as financial and non-financial covenants. Pursuant to the terms of the Series X Certificate of Designations, at any time after issuance of the Series X Preferred Stock, to the extent (i) the Merger Agreement is terminated for any reason before the Merger is consummated and (ii) REalloys raises capital in any financing, REalloys is required to use 50% of the aggregate gross proceeds from such financing to redeem all or any portion of the Series X Preferred Stock then outstanding. The amortization payments due upon such redemption are payable by REalloys in cash at a price equal to the product of (i) 110% and (ii) the Stated Value (as defined in the Series X Certificate of Designation) of the shares of Series X Preferred Stock being redeemed plus any and all accrued and unpaid dividends on such shares of Series X Preferred Stock.

In addition, the Series X Certificate of Designations includes certain Triggering Events, including, among other things, REalloys’ failure to pay any amounts due to the holders of Series X Preferred Stock when due. In connection with a Triggering Event, each holder of Series X Preferred Stock will be able to require REalloys to redeem in cash any or all of the holder’s shares of Series X Preferred Stock at a premium set forth in the Series X Certificate of Designations. Additionally, REalloys is subject to certain affirmative and negative covenants regarding the incurrence of indebtedness, the existence of liens, restricted payments and investments, restrictions on redemption and cash dividends, restrictions on transfer of assets, the maturity of indebtedness, change in nature of business, preservation of existence, maintenance of properties, intellectual property and insurance, transactions with affiliates, restricted issuances and restrictions on acquisitions, among other matters, pursuant to the terms of the Series X Certificate of Designations.

Our obligations as related to the Series X Preferred Stock may limit our flexibility in raising capital, and limit such aggregate gross proceeds we may receive from any financings, which may in turn have an adverse effect on our business and operations. Additionally, upon the occurrence of certain Triggering Events, which we may not be able to control, we will be required to redeem the Series X Preferred Stock pursuant to the terms of the Series X Certificate of Designations, which will have a material adverse effect on our financial condition and operations.

Capital and operating cost estimates made in respect of our current and future development projects and mines may not prove to be accurate.

Capital and operating cost estimates made in respect of our current and future development projects and mines may not prove to be accurate. Capital and operating costs are estimated based on the interpretation of geological data, feasibility studies, anticipated climatic conditions and other factors. Any of the following events, among the other events and uncertainties described herein, could affect the ultimate accuracy of such estimates: (i) unanticipated changes in grade and tonnage of ore to be mined and processed; (ii) incorrect data on which engineering assumptions are made; (iii) delay in construction schedules and unanticipated transportation costs; (iv) the accuracy of major equipment and construction cost estimates; (v) labor negotiations; (vi) changes in government regulation (including regulations regarding prices, cost of consumables, royalties, duties, taxes, permitting and restrictions on production quotas on exportation of minerals); and (vii) title claims.

Risks Related to Blackboxstocks Prior to the Consummation of the Merger

Unless otherwise indicated, reference in this section, “Risks Related to Blackboxstocks Prior to the Consummation of the Merger” and elsewhere in this joint proxy and consent solicitation statement/prospectus to the Blackboxstocks business being adversely affected, negatively impacted or harmed will include an adverse effect on, or a negative impact or harm to, the business, reputation, financial condition, results of operations, revenue and future prospects of the Combined Company. References in this section to the “Company,” “we,” “our,” or “us” generally refer to Blackboxstocks Inc. and as applicable, our wholly owned subsidiaries.

Risks Related to Ownership of Blackboxstocks Common Stock

We may not be able to satisfy listing requirements of Nasdaq or maintain a listing of our common stock on Nasdaq.

We are required to meet certain financial and liquidity criteria to maintain our Nasdaq listing. If we violate or fail to satisfy Nasdaq listing requirements, our common stock may be delisted. In addition, our board of directors may determine that the cost of maintaining our listing on a national securities exchange outweighs the benefits of such listing. A delisting of our common stock from Nasdaq may materially impair our stockholders’ ability to buy and sell our common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our common stock. The delisting of our common stock would significantly impair our ability to raise capital and the value of your investment.

If our shares of securities become subject to the penny stock rules, it would become more difficult to trade our shares.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. If we do not maintain a listing on Nasdaq or another national securities exchange and if the price of our common stock is less than $5.00, our common stock could be deemed a penny stock. The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock, and therefore stockholders may have difficulty selling their shares.

Fluctuations in our quarterly revenues may cause the price of our common stock to decline.

Our operating results have varied significantly from quarter to quarter in the past, and we expect our operating results to vary from quarter to quarter in the future due to a variety of factors, many of which are outside of our control. Therefore, if revenues are below our expectations, this shortfall is likely to adversely and disproportionately affect our operating results. Accordingly, we may not attain positive operating margins in future quarters. Any of these factors could cause our operating results to be below the expectations of securities analysts and investors, which likely would negatively affect the price of our common stock.

We are a “controlled company” within the meaning of the Nasdaq rules and, as a result, qualify for, and may elect to rely on, exemptions from certain corporate governance requirements that provide protection to the stockholders of companies that are subject to such corporate governance requirements.

Gust C. Kepler, who serves as a director, President and Chief Executive Officer of the Company, beneficially owns more than 50% of the voting power for the election of members of our board of directors. As a result, we are and will continue to be a “controlled company” within the meaning of the corporate governance standards of the Nasdaq rules. Under these rules, a listed company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain of Nasdaq’s corporate governance requirements.

As a controlled company, we may rely on certain exemptions from the Nasdaq standards that may enable us not to comply with certain Nasdaq corporate governance requirements. As a consequence, in the event that we elect to rely on certain exemptions from the Nasdaq standards provided to “controlled companies,” you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the Nasdaq Capital Market.

We do not anticipate paying any cash dividends in the foreseeable future.

We do not intend to declare and pay dividends on our common stock for the foreseeable future. We currently intend to invest future earnings, if any, to fund growth, to develop business, for working capital needs and for general corporate purposes. Therefore, you are not likely to receive any dividends on your common stock for the foreseeable future and the success of an investment in shares of our common stock will depend upon any future appreciation in their value. There is no guarantee that shares of our common stock will appreciate in value. In addition, foreign, U.S. or state law or the agreements governing our indebtedness may impose requirements that may restrict our ability to pay dividends to our common stockholders. 

Risks Related to Blackboxstocks’ Business

We expect to invest in growing our business, which may cause our sales and marketing, research and development, and other expenses to increase and our margins to decline.

We believe that our revenue growth, as well as our ability to improve or maintain margins and profitability, will depend upon, among other factors, our ability to address the challenges, risks, and difficulties described elsewhere in this “Risk Factors” section and the extent to which our various service offerings grow and contribute to our results of operations. We cannot provide assurance that we will be able to successfully manage any such challenges or risks to our future growth. In addition, our customer base may not continue to grow or may decline due to a variety of possible risks, including increased competition, changes in the regulatory landscape, and the maturation of our business. Any of these factors could cause our revenue growth to decline and may adversely affect our margins and profitability. Failure to continue our revenue growth or margin improvement could have a material adverse effect on our business, financial condition, and results of operations. You should not rely on our historical rate of revenue growth as an indication of our future performance.

If we do not continue to attract new subscriber customers, or if existing customers do not renew their subscriptions, or renew on less favorable terms, it could have a material adverse effect on our business, financial condition, and results of operations.

In order to grow our business, we must continually attract new subscribing customers and reduce the level of non-renewals in our business. Our ability to do so depends in large part on the success of our sales and marketing efforts. We may not accurately predict future trends with respect to rates of customer renewals. Our subscribing customer base may decline or fluctuate due to a number of factors, including the prices of our subscriptions, the prices of services offered by our competitors and the efficacy and cost-effectiveness of our solutions. If we are unable to retain and increase sales of our Blackbox System platform to existing subscribing customers or attract new ones for any of the reasons above or for other reasons, our business, financial condition, and results of operations could be adversely affected.

In order to achieve profitability, we must increase revenue levels.

We need to increase current revenue levels by increasing paid subscriptions to our Blackbox System platform or develop additional revenue sources from new products, services or applications if we are to attain and maintain consistent profitability. If we are unable to achieve increased revenue levels, losses could continue for the near term and possibly longer, and we may not attain profitability or generate positive cash flow from operations in the future.

We intend to introduce new products and services. There can be no assurance that we will be able to introduce such products and services effectively or profitably.

We intend to expand our product and service offering including the introduction of products and services which employ and expand upon our current proprietary system and technology. These products and services are expected to include applications targeted for investors who are not day traders or swing traders and products designed for professional traders. We introduced certain products and services in 2024 and 2025, expect to continue to introduce additional products and services in 2025 and spend significant capital on advertising and marketing of such products and services. If we are unable to generate significant revenue from this or other new products and services, we may incur significant operating losses.

We expect to face increasing competition in the market for our platform and services.

We face significant competition and we expect such competition to increase. Our industry and the markets we serve are evolving rapidly and becoming increasingly competitive. Larger and more established companies may focus on our markets and could directly compete with us. Smaller companies could also launch new platforms and services that compete with us and that could gain market acceptance quickly. We also expect our existing competitors in the markets to continue to focus on these areas. A number of these companies may have greater financial, technological, and other resources than we do and greater name recognition than us, which may enable them to compete more effectively. Specifically, we believe the following companies to be direct competitors: Trade Ideas, Flow Algo, Unusual Whales and Trade Alert. Companies with social media platforms dedicated to financial markets include Discord, Stock Twits and Wall Street Bets. Our competitors may announce new products, services, or enhancements that better address changing industry standards or the needs of our customers, such as mobile access. Any such increased competition could cause pricing pressure, loss of market share, or decreased customer engagement, any of which could adversely affect our business and operating results.

If we are not able to maintain and enhance our reputation and brand recognition, our business, financial conditions and results of operations will be harmed.

We believe that maintaining and enhancing our reputation and brand recognition is critical to our relationships with existing subscribing customers and our ability to attract new subscribing customers. The promotion of our brand may require us to make substantial investments, and we anticipate that, as our market becomes increasingly competitive, these marketing initiatives may become increasingly difficult and expensive. Our marketing activities may not be successful or yield increased revenue, and to the extent that these activities yield increased revenue, the increased revenue may not offset the expenses we incur, and our results of operations could be harmed. In addition, any factor that diminishes our reputation or that of our management, including failing to meet the expectations of our customers, could make it substantially more difficult for us to attract new customers. Similarly, because our subscribing customers often act as references for us with prospective new customers, any existing customer that questions the quality of our work or that of our employees could impair our ability to secure additional new customers. If we do not successfully maintain and enhance our reputation and brand recognition with our customers, our business may not grow and we could lose these relationships, which would harm our business, financial condition, and results of operations.

The estimates of market opportunity and forecasts of market growth included in this prospectus may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, our business may not grow at similar rates, or at all.

Market opportunity estimates and growth forecasts included in this prospectus are subject to significant uncertainty and are based on assumptions and estimates which may not prove to be accurate. The estimates and forecasts included in this prospectus relating to size and expected growth of our target market may prove to be inaccurate. Even if the markets in which we compete meet the size estimates and growth forecasts included in this prospectus, our business may not grow at similar rates, or at all. Our growth is subject to many factors, including our success in implementing our business strategy, which is subject to many risks and uncertainties.

We rely on software-as-a-service, or SaaS, technologies from third parties.

We rely on SaaS technologies from third parties in order to operate critical functions of our business, including financial management services, relationship management services, marketing services and data storage services. Some of our vendor agreements may be unilaterally terminated by the counterparty for convenience. If these services become unavailable due to contract cancellations, extended outages or interruptions, because they are no longer available on commercially reasonable terms or prices, or for any other reason, our expenses could increase, our ability to manage our finances could be interrupted, our processes for managing our offerings and supporting our consumers and partners could be impaired, and our ability to access or save data stored to the cloud may be impaired until equivalent services, if available, are identified, obtained, and implemented, all of which could harm our business, financial condition, and results of operations.

Any restrictions on our use of, or ability to license data, or our failure to license data and integrate third-party technologies, could have a material adverse effect on our business, financial condition, and results of operations.

We depend upon licenses from third parties for some of the technology and data used in our applications, and for some of the technological platforms upon which these applications are built and operate. We expect that we may need to obtain additional licenses from third parties in the future in connection with the development of our solutions and services. In addition, we obtain a portion of the data that we use from various securities and option exchanges. We believe that we have all rights necessary to use the data that is incorporated into our solutions and services. However, we cannot assure you that our licenses for information will allow us to use that information for all potential or contemplated applications and solutions.

In the future, data providers could withdraw their data from us or restrict our usage for any reason, including if there is a competitive reason to do so, if legislation is passed restricting the use of the data, or if judicial interpretations are issued restricting use of the data that we currently use in our solutions and services. If a substantial number of data providers were to withdraw or restrict their data and if we are unable to identify and contract with suitable alternative data suppliers and integrate these data sources into our service offerings, our ability to provide solutions and services to our subscribing customers would be materially adversely impacted, which could have a material adverse effect on our business, financial condition, and results of operations.

We also integrate into our proprietary applications and use third-party software to maintain and enhance, among other things, content generation and delivery, and to support our technology infrastructure. Our use of third-party technologies exposes us to increased risks, including, but not limited to, risks associated with the integration of new technology into our solutions, the diversion of our resources from development of our own proprietary technology, and our inability to generate revenue from licensed technology sufficient to offset associated acquisition and maintenance costs. These technologies may not be available to us in the future on commercially reasonable terms or at all and could be difficult to replace once integrated into our own proprietary applications. Most of these licenses can be renewed only by mutual consent and may be terminated if we breach the terms of the license and fail to cure the breach within a specified period of time. Our inability to obtain, maintain, or comply with any of these licenses could delay development until equivalent technology can be identified, licensed, and integrated, which would harm our business, financial condition, and results of operations.

Most of our third-party licenses are non-exclusive and our competitors may obtain the right to use any of the technology covered by these licenses to compete directly with us. If our data suppliers choose to discontinue support of the licensed technology in the future, we might not be able to modify or adapt our own solutions.

We are dependent on a limited number of key executives and employees, the loss of which could negatively impact our business.

Our business is led by our CEO Gust Kepler and a small group of key employees. The loss of one or more of these executives could negatively impact our business.

Risks Related to Blackboxstocks’ Intellectual Property

We may not be able to halt the operations of entities that copy our intellectual property or that aggregate our data as well as data from other companies, including social networks, or copycat online services that may misappropriate our data. These activities could harm our brand and our business.

From time to time, third parties may try to access content or data from our networks through scraping, robots, or other means and use this content and data or combine this content and data with other content and data as part of their services. These activities could degrade our brand, negatively impact our platform and system performance and harm our business. We have employed contractual, technological or legal measures in an attempt to halt unauthorized activities, but these measures may not be successful. In addition, if our customers do not comply with our terms of service, they also may be able to abuse our tools, solutions, and services and provide access to our solutions and content to unauthorized users. We may not be able to detect any or all of these types of activities in a timely manner and, even if we could, technological and legal measures may be insufficient to stop these actions. In some cases, particularly in the case of online services operating from outside of the United States, our available legal remedies may not be adequate to protect our business against such activities. Regardless of whether we can successfully enforce our rights against these parties, any measures that we may take could require us to expend significant financial or other resources.

Third parties may initiate legal proceedings alleging that we are infringing or otherwise violating their intellectual property rights, the outcome of which would be uncertain and could have a material adverse effect on our business, financial condition, and results of operations.

Our commercial success depends on our ability to develop and commercialize our platform, products and services and use our proprietary technology without infringing the intellectual property or proprietary rights of third parties. From time to time, we may be subject to legal proceedings and claims in the ordinary course of business with respect to intellectual property. We are not currently subject to any material claims from third parties asserting infringement of their intellectual property rights.

Intellectual property disputes can be costly to defend and may cause our business, operating results, and financial condition to suffer. Whether merited or not, we have in the past and may in the future face allegations that we, our partners, our licensees, or parties indemnified by us have infringed or otherwise violated the patents, trademarks, copyrights, or other intellectual property rights of third parties. Such claims may be made by competitors seeking to obtain a competitive advantage or by other parties. Some third parties may be able to sustain the costs of complex litigation more effectively than we can because they have substantially greater resources. Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions, or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the price of our common stock. Moreover, any uncertainties resulting from the initiation and continuation of any legal proceedings could have a material adverse effect on our ability to raise the funds necessary to continue our operations. Assertions by third parties that we violate their intellectual property rights could therefore have a material adverse effect on our business, financial condition, and results of operations.

Failure to maintain, protect, or enforce our intellectual property rights could harm our business and results of operations.

We may pursue the registration of our domain names, trademarks, and service marks in the United States. We also strive to protect our intellectual property rights by relying on federal, state, and common law rights, as well as contractual restrictions. We typically enter into confidentiality and invention assignment agreements with our employees and contractors, and confidentiality agreements with parties with whom we conduct business in order to limit access to, and disclosure and use of, our proprietary information. However, we may not be successful in executing these agreements with every party who has access to our confidential information or contributes to the development of our technology or intellectual property rights. Those agreements that we do execute may be breached, and we may not have adequate remedies for any such breach. These contractual arrangements and the other steps we have taken to protect our intellectual property rights may not prevent the misappropriation or disclosure of our proprietary information nor deter independent development of similar technology or intellectual property by others.

Effective trade secret, patent, copyright, trademark and domain name protection is expensive to obtain, develop and maintain, both in terms of initial and ongoing registration or prosecution requirements and expenses and the costs of defending our rights. We have invested in and may, over time, increase our investment in protecting our intellectual property through patent filings that could be expensive and time-consuming. Our trademarks and other intellectual property rights may be challenged by others or invalidated through administrative process or litigation. We have not yet applied for or obtained any issued patents that provide protection for our technology or products. Moreover, any issued patents we may obtain may not provide us with a competitive advantage and, as with any technology, competitors may be able to develop similar or superior technologies to our own, now or in the future. In addition, due to a recent U.S. Supreme Court case, it has become increasingly difficult to obtain and assert patents relating to software or business methods, as many such patents have been invalidated for being too abstract to constitute patent-eligible subject matter. We do not know whether this will affect our ability to obtain patents on our innovations, or successfully assert any patents we may pursue in litigation or pre-litigation campaigns.

Monitoring unauthorized use of the content on our platform, and our other intellectual property and technology, is difficult and costly. Our efforts to protect our proprietary rights and intellectual property may not have been and may not be adequate to prevent their misappropriation or misuse. Third parties, including our competitors, could be infringing, misappropriating, or otherwise violating our intellectual property rights. We may not be successful in stopping unauthorized use of our content or other intellectual property or technology. Further, we may not have been and may not be able to detect unauthorized use of our technology or intellectual property, or to take appropriate steps to enforce our intellectual property rights. Any inability to meaningfully enforce our intellectual property rights could harm our ability to compete and reduce demand for our solutions and services. Our competitors may also independently develop similar technology. Effective patent, trademark, copyright and trade secret protection may not be available to us in every jurisdiction in which our solutions or technology are hosted or available. Further, legal standards relating to the validity, enforceability, and scope of protection of intellectual property rights are uncertain. The laws in the United States and elsewhere change rapidly, and any future changes could adversely affect us and our intellectual property. Our failure to meaningfully protect our intellectual property rights could result in competitors offering solutions that incorporate our most technologically advanced features, which could reduce demand for our solutions.

We may find it necessary or appropriate to initiate claims or litigation to enforce our intellectual property rights, protect our trade secrets, or determine the validity and scope of intellectual property rights claimed by others. In any lawsuit we bring to enforce our intellectual property rights, a court may refuse to stop the other party from using the technology at issue on grounds that our intellectual property rights do not cover the use or technology in question. Further, in such proceedings, the defendant could counterclaim that our intellectual property is invalid or unenforceable and the court may agree, in which case we could lose valuable intellectual property rights. Litigation is inherently uncertain and any litigation of this nature, regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources, any of which could adversely affect our business and results of operations. If we fail to maintain, protect, and enforce our intellectual property, our business and results of operations may be harmed.

The laws of some foreign countries do not protect intellectual property rights to the same extent as the laws of the United States. Many companies have encountered significant problems in protecting and defending intellectual property rights in certain foreign jurisdictions. The legal systems of some countries, particularly developing countries, do not favor the enforcement of intellectual property protection. This could make it difficult for us to stop the infringement or misappropriation of our intellectual property rights. Proceedings to enforce our intellectual property in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business. In addition, changes in the law and legal decisions by courts in the United States and foreign countries may affect our ability to obtain adequate protection for our technology and the enforcement of intellectual property.

If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our markets of interest and our business may be adversely affected.

We believe that our brand is critical to the success of our business, and we plan to utilize trademark registration and other means to protect it. Our business would be harmed if we were unable to protect our brand against infringement and its value was to decrease as a result.

We have registered our “Blackboxstocks” tradename and logo with the USPTO. We may apply for registration of additional product name or marks.

The registered or unregistered trademarks or trade names that we own or license may be challenged, infringed, circumvented, declared generic, lapsed, or determined to be infringing on or dilutive of other marks. We may not be able to protect our rights in these trademarks and trade names, which we need in order to build name recognition with customers and potential partners. In addition, third parties may in the future file for registration of trademarks similar or identical to our trademarks. If they succeed in registering or developing common law rights in such trademarks, and if we are not successful in challenging such third-party rights, we may not be able to use these trademarks to commercialize our technologies or solutions in certain relevant countries. If we are unable to establish name recognition based on our trademarks and trade names, we may not be able to compete effectively and our business may be adversely affected.

If we are unable to protect the confidentiality of our trade secrets, our business and competitive position could be harmed.

We rely heavily on trade secrets and confidentiality agreements to protect our unpatented know-how, technology, and other proprietary information, including our technology platform, and to maintain our competitive position. With respect to our technology platform, we consider trade secrets and know-how to be one of our primary sources of intellectual property. However, trade secrets and know-how can be difficult to protect. We seek to protect these trade secrets and other proprietary technology in part by entering into non-disclosure and confidentiality agreements with parties who have access to them, such as our employees, outside contractors, consultants, advisors, and other third parties. We also enter into confidentiality and invention or patent assignment agreements with our employees and consultants. The confidentiality agreements are designed to protect our proprietary information and, in the case of agreements or clauses containing invention assignment, to grant us ownership of technologies that are developed through a relationship with employees or third parties. We cannot guarantee that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary information, including our technology and processes. Despite these efforts, no assurance can be given that the confidentiality agreements we enter into will be effective in controlling access to such proprietary information and trade secrets. The confidentiality agreements on which we rely to protect certain technologies may be breached, may not be adequate to protect our confidential information, trade secrets, and proprietary technologies and may not provide an adequate remedy in the event of unauthorized use or disclosure of our confidential information, trade secrets, or proprietary technology. Further, these agreements do not prevent our competitors or others from independently developing the same or similar technologies and processes, which may allow them to provide a service similar or superior to ours, which could harm our competitive position.

Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive, and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or unwilling to protect trade secrets. If any of our trade secrets 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. If any of our trade secrets were to be disclosed to or independently developed by a competitor or other third party, it could harm our competitive position, business, financial condition, results of operations, and prospects.

If we fail to comply with our obligations under license or technology agreements with third parties, we may be required to pay damages and we could lose license rights that are critical to our business.

We license certain intellectual property, including technologies and software from third parties, that is important to our business, and we may enter into future additional agreements that provide us with licenses to valuable intellectual property or technology. If we fail to comply with any of the obligations under our license agreements, we may be required to pay damages and the licensor may have the right to terminate the license. Termination by the licensor would cause us to lose valuable rights, and could prevent us from selling our solutions and services, or adversely impact our ability to commercialize future solutions and services. Our business would suffer if any current or future licenses terminate, if the licensors fail to abide by the terms of the license, if the licensors fail to enforce licensed patents against infringing third parties, if the licensed intellectual property are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms. In addition, our rights to certain technologies are licensed to us on a non-exclusive basis. The owners of these non-exclusively licensed technologies are therefore free to license them to third parties, including our competitors, on terms that may be superior to those offered to us, which could place us at a competitive disadvantage. Moreover, our licensors may own or control intellectual property that has not been licensed to us and, as a result, we may be subject to claims, regardless of their merit, that we are infringing or otherwise violating the licensor’s rights. In addition, the agreements under which we license intellectual property or technology from third parties are generally 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. Any of the foregoing could harm our competitive position, business, financial condition, results of operations, and prospects.

If we cannot license rights to use intellectual property on reasonable terms, we may not be able to commercialize new solutions or services in the future.

In the future, we may identify additional third-party intellectual property we may need to license in order to engage in our business, including to develop or commercialize new solutions or services. However, such licenses may not be available on acceptable terms or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. These established companies may have a competitive advantage over us due to their size, capital resources, and greater development or commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. Even if such licenses are available, we may be required to pay the licensor substantial royalties based on sales of our solutions and services. Such royalties are a component of the cost of our solutions or services and may affect the margins on our solutions and services. In addition, such licenses may be non-exclusive, which could give our competitors access to the same intellectual property licensed to us. If we are unable to enter into the necessary licenses on acceptable terms or at all, if any necessary licenses are subsequently terminated, if our licensors fail to abide by the terms of the licenses, if our licensors fail to prevent infringement by third parties, or if the licensed intellectual property rights are found to be invalid or unenforceable, our business, financial condition, results of operations, and prospects could be affected. If licenses to third-party intellectual property rights are, or become required for us, to engage in our business, the rights may be non-exclusive, which could give our competitors access to the same technology or intellectual property rights licensed to us. Moreover, we could encounter delays and other obstacles in our attempt to develop alternatives. Defense of any lawsuit or failure to obtain any of these licenses on favorable terms could prevent us from commercializing solutions and services, which could harm our competitive position, business, financial condition, results of operations, and prospects.

Risks Relating to the Merger

The Company will allocate time and resources to effecting the Merger and incur non-recurring costs related to the REalloys Merger.

The Company and its management have allocated and will continue to be required to allocate time and resources to effecting the completion of the pending Merger transaction with REalloys and related and incidental activities. There is a risk that the challenges associated with managing these various Merger initiatives may have a business impact and that consequently the underlying businesses will not perform in line with expectations. This could have an adverse effect on the reputation, business, financial condition or results of operations of the Company.

In addition, the Company expects to incur a number of non-recurring costs associated with the Merger, including taxes, legal fees, advisor fees, filing fees, mailing expenses, and financial printing expenses. There can be no assurance that the actual costs will not exceed those estimated and the actual completion of the Merger may result in additional and unforeseen expenses. Many of these costs will be payable whether or not the Merger is completed. While it is expected that benefits of the Merger achieved by the Company will offset these transaction costs over time, this net benefit may not be achieved in the short-term or at all, particularly if the Merger are delayed or does not happen at all. These combined factors could adversely affect the business, results of operations or financial condition of the Company.

The Merger will require REalloys Inc. to apply for an initial listing on Nasdaq which may not be granted.

The Merger is expected to be treated as a reverse merger by Nasdaq which will require the post-Merger Company to apply for an initial listing on the Nasdaq Capital Market. There are numerous listing requirements including but not limited to minimum equity requirements and certain minimum requirements for stockholder holdings and a minimum bid price of $4.00 per share. There can be no assurance that the Company will be able to meet the initial listing requirements of the Nasdaq Capital Market which could result in either the Company’s delisting or termination of the Merger.

The calculation of the number of Blackboxstocks shares to be issued may be adjusted if there is a change in REalloys share capital between the date of Merger Agreement and Closing.

The calculation of the number of Company shares to be issued in the Merger may be adjusted in the event that REalloys issues any share capital between the date of the Merger Agreement and Closing pursuant to the exchange ratio in the Merger Agreement. The parties may not be permitted to terminate the Merger Agreement because of changes in the exchange ratio.

The Merger may not be completed on the terms or timeline currently contemplated, or at all, as Blackboxstocks or REalloys may be unable to satisfy conditions or obtain the approvals required to complete the Merger or such approvals may contain material restrictions or conditions.

Completion of the Merger is subject to numerous conditions. Although the Company is diligently applying its efforts to take, or cause to be taken, all actions to do, or cause to be done, all things necessary, proper or advisable to consummate the Merger, there can be no assurance that these conditions will be fulfilled or that the Merger will be completed on the terms or timeline currently contemplated, or at all. We have and will continue to expend time and resources and incur expenses related to the Merger. Many of these expenses must be paid regardless of whether the Merger are consummated. Governmental agencies and/or the Nasdaq may not approve the Merger, may impose conditions to the approval of the Merger or require changes to the terms of the Merger. Any such conditions or changes could have the effect of delaying completion of the Merger, imposing costs on or limiting the revenues of the Company following the Merger or otherwise reducing the anticipated benefits of the Merger.

Completion of the Merger may trigger certain provisions in agreements to which the Company or its operating subsidiary is a party.

The completion of the Merger may trigger certain change in control, consent, assignment or other provisions in agreements to which the Company, our subsidiary Blackbox Operating, or REalloys is a party. In addition, the completion of the Merger may trigger certain technical provisions in agreements to which the Company, Blackbox Operating or REalloys is a party. If such parties are unable to assert that such provisions should not apply, or the parties are unable to comply with or negotiate waivers of those provisions, the counterparties may exercise their rights and remedies under the agreements, including potentially terminating such agreements or seeking monetary damages. Even if the Company, Blackbox Operating or REalloys is able to negotiate waivers, the counterparties may require a fee for such waivers or seek to renegotiate the agreements on terms less favorable to the Company.

Failure to complete the Merger could adversely affect the market price of our common stock as well as our business, financial condition and results of operations.

If the Merger is not completed for any reason, the price of our common stock may decline, and our business, financial condition and results of operations may be impacted to the extent that the market price of our common stock reflects positive market assumptions that the Merger will be completed and the related expected benefits will be realized; based on significant expenses, such as legal, advisory and financial services which generally must be paid regardless of whether the Merger is completed; based on potential disruption of our business and distraction of our workforce and management team and other contemplated transactions under the Merger Agreement (the “Contemplated Transactions”).

The announcement and pendency of the Merger could have an adverse effect on the stock price of our common stock as well as our business, financial condition, results of operations or business prospects.

The announcement and pendency of the Merger could disrupt our businesses in negative ways. For example, customers and other third-party business partners may seek to terminate and/or renegotiate their relationships with the Company as a result of the Merger, whether pursuant to the terms of their existing agreements or otherwise. In addition, current and prospective employees may experience uncertainty regarding their future roles with the Company upon consummation of the Merger, which might adversely affect our ability to retain, recruit and motivate key personnel. Should they occur, any of these events could adversely affect the price of our common stock, or harm our financial condition, results of operations or business prospects.

We may have difficulty attracting, motivating and retaining executives and other employees in light of the Merger.

We may have difficulty attracting, motivating and retaining executives and other employees in light of the Merger. Uncertainty about the effect of the Merger on our employees may have an adverse effect. This uncertainty may impair our ability to attract, retain and motivate personnel until the Merger is completed.

Litigation relating to the Merger, if any, could result in an injunction preventing the completion of the Merger and/or substantial costs to the Company.

Securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into acquisition, merger or other business combination agreements like the Merger Agreement. Even if such a lawsuit is without merit, defending against these claims can result in substantial costs and divert management time and resources. An adverse judgment could result in monetary damages, which could have a negative impact on our liquidity and financial condition. Lawsuits that may be brought against us or our directors could also seek, among other things, injunctive relief or other equitable relief, including a request to rescind parts of the Merger Agreement already implemented and to otherwise enjoin the parties from consummating the Merger. One of the conditions to the closing of the Merger is that no order preventing the consummation of the Contemplated Transactions shall have been issued by and governmental authority of competent jurisdiction and remain in effect and that there shall not be any law which has the effect of making the consummation of the Contemplated Transactions illegal. Consequently, if a plaintiff is successful in obtaining an injunction prohibiting completion of the Merger, that injunction may delay or prevent the Merger from being completed within the expected time frame or at all, which may adversely affect our business, financial position and results of operations.

Blackboxstocks General Risk Factors

If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our stock, or if our results of operations do not meet their expectations, our stock price and trading volume could decline.

The trading market for our securities will be influenced by the research and reports that securities or industry analysts publish about us or our business (or the absence of such research or reports). If 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 stock price or trading volume to decline. Moreover, if one or more of the analysts who cover us downgrade recommendations regarding our stock, or if our results of operations do not meet their expectations, our stock price could decline and such decline could be material.

We are an “emerging growth company” and our compliance with the reduced reporting and 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 Jumpstart Our Business Startups Act, or the JOBS Act, and we have elected to take advantage of certain exemptions and relief from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” These provisions include, but are not limited to: being permitted to have only two years of audited financial statements and only two years of related management’s discussion and analysis of financial condition and results of operations disclosures; being exempt from compliance with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act; being subject to reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and not being required to hold nonbinding advisory votes on executive compensation or on any golden parachute payments not previously approved.

In addition, while we are an “emerging growth company,” we will not be required to comply with any new financial accounting standard until such standard is generally applicable to private companies. As a result, our financial statements may not be comparable to companies that are not “emerging growth companies” or elect not to avail themselves of this provision.

We may remain an “emerging growth company” until as late as December 31, 2026, the fiscal year-end following the fifth anniversary of the completion of our initial public offering, though we may cease to be an “emerging growth company” earlier under certain circumstances, including if (i) we have more than $1.07 billion in annual revenue in any fiscal year, (ii) we become a “large accelerated filer,” with at least $700 million of equity securities held by non-affiliates as of the end of the second quarter of that fiscal year, or (iii) we issue more than $1.0 billion of non-convertible debt over a three-year period.

The exact implications of the JOBS Act are still subject to interpretations and guidance by the SEC and other regulatory agencies, and we cannot assure you that we will be able to take advantage of all the benefits of the JOBS Act. In addition, investors may find our common stock less attractive to the extent we rely on the exemptions and relief granted by the JOBS Act. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may decline or become more volatile.

If we are unable to implement and maintain effective internal controls over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports.

As a public company, we are required to maintain internal controls over financial reporting and to report any material weaknesses in such internal controls. We are required to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act. However, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act until the date we are no longer an “emerging growth company” as defined in the JOBS Act. Accordingly, you will not be able to depend on any attestation concerning our internal control over financial reporting from our independent registered public accounting firm for the foreseeable future.

The process of designing and implementing internal controls over financial reporting is time consuming, costly, and complicated. If during the evaluation and testing process, we identify one or more material weaknesses in our internal control over financial reporting or determine that existing material weaknesses have not been remediated, our management will be unable to assert that our internal control over financial reporting is effective. Even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm may conclude that there are material weaknesses with respect to our internal controls or the level at which our internal controls are documented, designed, implemented, or reviewed. If we are unable to assert that our internal control over financial reporting is effective, or when required in the future, if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the valuation of our common stock could be adversely affected.