{"url_path":"/sec/akan/10-k/2026/item-3","section_key":"item-3","section_title":"Item 3 KEY INFORMATION**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-09","source_url":"https://www.sec.gov/Archives/edgar/data/1888014/0001213900-26-066800-index.html","accession_number":"0001213900-26-066800","cik":"0001888014","ticker":"AKAN","issuer_name":"AKANDA CORP.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1888014/0001213900-26-066800-index.html","primary_entity_key":"0001888014","primary_entity_name":"AKANDA CORP."},"word_count":23203,"has_tables":true,"body_markdown":"**ITEM 3. KEY INFORMATION**\n\n** **\n\n**A.**\n**[Reserved]**\n\n** **\n\n**B.**\n**Capitalization\nand Indebtedness**\n\n \n\nNot applicable.\n\n \n\n**C.**\n**Reasons\nfor the Offer and Use of Proceeds**\n\n \n\nNot applicable.\n\n \n\n**D.**\n**Risk\nFactors**\n\n \n\n*The following risks relate\nspecifically to our business and should be considered carefully. Our business, financial condition and results of operations could be\nharmed by any of the following risks. As a result, the trading price of our common shares could decline and shareholders could lose part\nor all of their investment.*\n\n \n\n**Risks Related to the First Towers Transaction**\n\n** **\n\n**The market price of our Common Shares is\nexpected to continue to fluctuate after the First Towers Transaction.**\n\n  \n\nThe market price of the\ncommon shares of Akanda has and is expected to continue to, fluctuate, potentially significantly, following completion of the Transaction,\nas a result of a variety of factors, including for example, among others, general market and economic conditions, changes in our businesses,\noperations and prospects, interest rates, general market, industry and economic conditions and other factors generally affecting the\nstock prices, federal, state and local legislation, governmental regulation and legal developments in the industry segments in which\nAkanda now operates. In addition, any significant price or volume fluctuations in the stock market generally could have a material adverse\neffect on the market for, or liquidity of, our common shares, regardless of the post-transaction actual operating performance.\n\n \n\n**As a result of the First Towers Transaction,\nthe market price for our common shares may be affected by factors different from, or in addition to, those that historically have affected\nor currently affect the market prices of Akanda Common Stock.**\n\n  \n\nFirst Towers’ business\ndiffers from those of Akanda’s historical cannabis operations, and, accordingly, our results of operations post-Transaction have\nbeen and will likely continue to be affected by some factors that are different from those currently or historically affecting the results\nof operations of Akanda.\n\n** **\n\n**Failure to attract, motivate and retain\nexecutives and other key employees could diminish the anticipated benefits of the Transaction.**\n\n  \n\nThe success of our integration\nof First Towers into our company will depend in part on our ability to retain the talents and dedication of key professionals of First\nTowers. It is possible that these employees may decide not to remain with First Towers. If key employees terminate their employment,\nor if an insufficient number of employees are retained to maintain effective operations, Akanda’s business activities with respect\nto our First Towers subsidiary may be adversely affected and management’s attention may be directed to hiring suitable replacements,\nall of which may cause that business to suffer. In addition, Akanda may not be able to locate suitable replacements for any key employees\nthat leave either company or offer employment to potential replacements on reasonable terms. No assurance can be given that post-Transaction,\nAkanda will be able to attract or retain key employees to the same extent that those companies have been able to attract or retain their\nown employees in the past.\n\n \n\n1\n\n \n\n  \n\n**The First Towers Transaction has and may\ncontinue to cause disruptions in the business of Akanda and First Towers, which could have an adverse effect on Akanda’s business\nand financial results.**\n\n  \n\nThe First Towers Transaction\nhas caused disruptions in the business of Akanda and of First Towers, including by diverting some of the attention of their respective\nmanagement toward the completion of the First Towers Transaction instead of focusing on their respective business. In addition, Akanda\nhas diverted significant management resources in an effort to complete the First Towers Transaction and integrate First Towers into our\ncompany, which could have been applied to further building its legacy business.\n\n \n\n**Akanda may be exposed to increased litigation,\nwhich could have an adverse effect on Akanda’s business and operations post-Transaction.**\n\n  \n\nAkanda may be exposed to\nincreased litigation from stockholders (including former stockholders of First Towers), customers, suppliers, distributors, consumers\nand other third parties following the First Towers Transaction. Such litigation may have an adverse impact on Akanda’s business\nand results of operations or may cause disruptions to Akanda’s operations.\n\n** **\n\n**Akanda’s cannabis business may be\nsecondary to First Tower’s existing business. Akanda Shareholders will therefore after the Transaction have a continuing equity\ninterest predominantly in the business of First Towers.**\n\n  \n\nAkanda expects to continue\nits planned development of the hemp and cannabis cultivation business in Gabriola Island, British Columbia; however, the assets and existing\nbusiness of First Towers are expected to account for a substantial percentage of the combined business’ focus.\n\n** **\n\n**Akanda’s debt post-Transaction may\nlimit its financial flexibility.**\n\n  \n\nAkanda assumed approximately\n$20 million of First Towers indebtedness, although a significant amount has been prepaid to date. Our indebtedness could have adverse\neffects on the financial condition and results of operations of Akanda post-Transaction, including:\n\n \n\n \n**●**\nincreasing its vulnerability\nto changing economic, regulatory and industry conditions;\n\n \n\n \n●\nlimiting its ability to\ncompete and its flexibility in planning for, or reacting to, changes in its business and the industry;\n\n \n\n \n●\nlimiting its ability to\npay dividends to its stockholders, if at all;\n\n \n\n \n●\nlimiting its ability to\nborrow additional funds; and\n\n \n\n \n●\nincreasing its interest\nexpense and requiring Akanda post-Transaction to dedicate a substantial portion of its cash flow from operations to payments on its\ndebt, thereby reducing funds available for working capital, capital expenditures, acquisitions, share repurchases, dividends and\nother purposes.\n\n \n\nThe ability of Akanda post-Transaction\nto arrange any additional financing for the purposes described above or otherwise will depend on, among other factors, Akanda’s\nfinancial position and performance, as well as prevailing market conditions and other factors beyond its control.\n\n \n\n2\n\n \n\n \n\n**Holders of Akanda’s common shares\nwill be diluted by the future issuance of additional common shares underlying the issuances of Class B Special Shares in connection with\nthe First Towers Transaction or otherwise; future sales of such shares in the public market or the expectation that such sales may occur\nmay decrease the market price of Akanda’s common shares.**\n\n  \n\nAkanda is expected to issue\na significant number of common shares in the future, relative to the number of shares outstanding, in connection with the issuance of\nits Class B Special Shares that are held by the former shareholders of First Towers, in addition to the common shares already issued\nto such former shareholders upon the conversion of their Class A Special Shares issued at the closing of the First Towers Transaction.\nThese issuances have and are expected to further dilute Akanda existing stockholders, and such dilution could be significant. Moreover,\nsuch dilution could have a material adverse effect on the market price for the shares of Akanda’s common shares. Since the Class\nB Special Shares vote with the common shares as a single class, the voting rights of existing common shareholders of Akanda will be adversely\naffected, by diluting the voting power of Akanda’s common shares.\n\n \n\n**Risks Related to Akanda’s Cannabis Business**\n\n \n\n**We are an early-stage cannabis company\nwith limited operating history and these operations may never become profitable.**\n\n \n\nAkanda was only recently\nincorporated to be a holding company in 2021, with operating subsidiaries having limited operating histories and generating minimal revenue.\nSince then, we have discontinued our European operations while we are seeking to launch our hemp and THC/CBD farming facility in British\nColumbia, Canada. We remain an early-stage company and have limited financial resources and minimal operating cash flow. If we cannot\nsuccessfully develop, manufacture and distribute our planned cannabis products, or have capacity constraints, quality control problems\nor other disruptions, we may not be able to develop or offer market-ready commercial products at acceptable costs, which would adversely\naffect our ability to effectively enter the market or expand our market share. A failure by us to achieve a low-cost structure through\neconomies of scale or improvements in cultivation, manufacturing or distribution processes would have a material adverse effect on our\ncommercialization plans and our business, prospects, results of operations and financial condition.\n\n \n\nWe expect to require additional\nfunding to develop and launch our pre-revenue hemp and THC/CBD cultivation facility in Gabriola Island, British Columbia. However,\nthere can be no assurance that additional funding will be available to us for the development of our planned businesses, which will require\nthe commitment of substantial resources. Accordingly, you should consider our prospects in light of the costs, uncertainties, delays\nand difficulties frequently encountered by companies in the early stages of development. Potential investors should carefully consider\nthe risks and uncertainties that an early stage company with a very limited operating history will face. In particular, potential investors\nshould consider that we may be unable to:\n\n \n\n●successfully\nimplement or execute our business plan, or that our business plan is sound;\n\n \n\n●effectively\npursue business opportunities, including potential acquisitions;\n\n \n\n●adjust\nto changing conditions or keep pace with increased demand;\n\n \n\n●attract\nand retain an experienced management team; or\n\n \n\n●raise\nsufficient funds in the capital markets to effectuate our business plan, including expanding\nproduction capacity. licensing and approvals.\n\n** **\n\n**Demand for cannabis and its derivative\nproducts could be adversely affected and significantly influenced by scientific research or findings, regulatory proceedings, litigation,\nor media attention.**\n\n \n\nThe legal cannabis industry\nin Canada and in many other potential markets for us is at an early stage of its development. Consumer perceptions regarding legality,\nmorality, consumption, safety, efficacy and quality of medicinal cannabis are mixed and evolving and can be significantly influenced\nby scientific research or findings, regulatory investigations, litigation, media attention and other publicity regarding the consumption\nof medicinal cannabis products. There can be no assurance that future scientific research, findings, regulatory proceedings, litigation,\nmedia attention or other research findings or publicity will be favorable to the medicinal cannabis market or any particular product,\nor consistent with earlier publicity. Future research reports, findings, regulatory proceedings, litigation, media attention or other\npublicity that are perceived as less favorable than, or that question, earlier research reports, findings or publicity, could have a\nmaterial adverse effect on the demand for medicinal cannabis and on our business, results of operations, financial condition and cash\nflows. Public opinion and support for medicinal cannabis use has traditionally been inconsistent and varies from jurisdiction to jurisdiction.\nOur ability to gain and increase market acceptance of our business may require substantial expenditures on investor relations, strategic\nrelationships and marketing initiatives. There can be no assurance that such initiatives will be successful, and their failure to materialize\ninto significant demand may have an adverse effect on our financial condition.\n\n** **\n\n3\n\n \n\n \n\n**Our success will depend, in part, on our\nability to continue to enhance our product offerings to respond to technological and regulatory changes and emerging industry standards\nand practices.**\n\n \n\nRapidly changing markets,\ntechnology, emerging industry and regulatory standards and frequent introduction of new products characterize our business and planned\nbusiness. The process of cultivating and processing our planned cannabis products to meet applicable standards and successfully marketing\nsuch products and obtaining necessary licenses requires significant continuing costs, marketing efforts, third-party commitments and\nregulatory approvals. We may also decide to expand our planned product offering to include cannabis oils and extracts, and ultimately,\nto produce consumer branded cannabis products. We may not be successful in expanding our production capacity, or obtaining any required\nregulatory approvals or licenses, to implement our growth plans, which, together with any capital expenditures made in our operations,\nmay have a material adverse effect on our business, financial condition and operating results.\n\n** **\n\n**We are subject to the inherent risk of\nexposure to product liability claims.**\n\n \n\nAs a planned cultivator\nand distributor of products designed to be ingested by humans, we will face an inherent risk of exposure to product liability claims,\nregulatory action and litigation if our products are alleged to have caused bodily harm or injury. In addition, the sale of our planned\nproducts involves the risk of injury to consumers due to tampering by unauthorized third parties or product contamination. Adverse reactions\nresulting from human consumption of our products alone or in combination with other medications or substances could occur. We may be\nsubject to various product liability claims, including, among others, that our products caused injury or illness, include inadequate\ninstructions for use or include inadequate warnings concerning health risks, possible side effects or interactions with other substances.\nProduct liability claims or regulatory actions against us could result in increased costs, could adversely affect our reputation with\nour clients and consumers generally, and could have a material adverse effect on our results of operations and financial condition. There\ncan be no assurances that we will be able to obtain or maintain product liability insurance on acceptable terms or with adequate coverage\nagainst potential liabilities. Such insurance is expensive and may not be available in the future on acceptable terms, or at all. The\ninability to obtain sufficient insurance coverage on reasonable terms or to otherwise protect against potential product liability claims\ncould prevent or inhibit the commercialization of our products.\n\n \n\n**We are subject to the inherent risks involved\nwith product recalls.**\n\n \n\nManufacturers and distributors\nof products are sometimes subject to the recall or return of their products for a variety of reasons, including product defects, such\nas contamination, unintended harmful side effects or interactions with other substances, packaging safety and inadequate or inaccurate\nlabelling disclosure. If any of our planned products are recalled due to an alleged product defect or for any other reason, we could\nbe required to incur the unexpected expense of the recall and any legal proceedings that might arise in connection therewith. There can\nbe no assurance that any quality, potency or contamination problems will be detected in time to avoid unforeseen product recalls, regulatory\naction or lawsuits. Additionally, if our products are subject to recall, our reputation could be harmed. A recall for any of the foregoing\nreasons could lead to decreased demand for our planned products and could have a material adverse effect on our results of operations\nand financial condition. Additionally, product recalls may lead to increased scrutiny of our operations by regulatory agencies, requiring\nfurther management attention, potential loss of applicable licenses, and increased legal fees and other expenses.\n\n** **\n\n**Research regarding the medical benefits,\nviability, safety, efficacy, use and social acceptance of cannabis or isolated cannabinoids (such as cannabidiol and tetrahydrocannabinol)\nremains in early stages.**\n\n \n\nThere have been relatively\nfew clinical trials on the benefits of cannabis or isolated cannabinoids (such as cannabidiol and tetrahydrocannabinol). Although we\nbelieve that the articles, reports and studies published support our beliefs regarding the viability, safety, efficacy, dosing and social\nacceptance of cannabis, future research and clinical trials may prove such statements to be incorrect, or could raise concerns regarding,\nand perceptions relating to, cannabis. Given these risks, uncertainties and assumptions, investors should not place undue reliance on\nsuch articles and reports. Future research studies and clinical trials may draw opposing conclusions to those stated herein or reach\nnegative conclusions related to medical cannabis, which could have a material adverse effect on the demand for our future products and\ncould result in a material adverse effect on our business, financial condition and results of operations or prospects.\n\n** **\n\n4\n\n \n\n \n\n**We may not be able to maintain effective\nquality control systems.**\n\n \n\nWe may not be able to maintain\nan effective quality control system. The effectiveness of our quality control system and our ability to maintain any Good Agricultural\nand Collecting Practices (“**GACP**”) certification we may receive with respect to our planned manufacturing, processing\nand testing facilities depend on a number of factors, including the design of our quality control procedures, training programs, and\nthe ability to ensure that our employees adhere to our policies and procedures. We also may depend on third party service providers to\nmanufacture, process or test our products, that are subject to GACP requirements.\n\n \n\nWe expect that regulatory\nagencies will periodically inspect our and our service providers’ facilities to evaluate compliance with applicable GACP requirements.\nFailure to comply with these requirements may subject us or our service providers to possible regulatory enforcement actions. Any failure\nor deterioration of our or our service providers’ quality control systems, including loss of the GACP certification we may receive,\nmay have a material adverse effect on our business, results of operations and financial condition.\n\n** **\n\n**The cannabis and cannabinoid industries\nface strong opposition.**\n\n \n\nMany political and social\norganizations oppose hemp and cannabis and their legalization, and many people, even those who support legalization, oppose the sale\nof hemp, cannabis and their derivatives in their geographies. Our business will need support from local governments, industry participants,\nconsumers and residents to be successful. Additionally, there are large, well-funded businesses and industry groups that may have a strong\nopposition to the cannabis industry. For example, the pharmaceutical and alcohol industries have traditionally opposed cannabis legalization.\nAny efforts by these or other industries opposed to cannabis to halt or impede the cannabis industry could have detrimental effects on\nour business.\n\n \n\n**We are subject to the risks inherent in\nan agricultural business.**\n\n \n\nOur business involves the\ngrowing of cannabis, which is an agricultural product. As a result, our financial results are subject to the risks inherent to the agricultural\nbusiness, such as crop disease, mold or mildew, insect infestations, volatile weather, drought, absorption of heavy metals, climate change\nand similar agricultural risks, which may adversely affect supply, reduce production and sales volumes, increase production costs, or\nprevent or impair shipments. Natural elements have had and could continue to have a material adverse effect on the production of our\ncannabis products, while prior use of pesticides at our agricultural sites, if not discovered prior to cultivation on such sites, could\nlead to the production of tainted and unsaleable product, which could negatively impact the results of our operations. Additionally,\ncrop insurance is generally not available to cannabis.\n\n \n\nWe further have not started\nany farming or cultivation at our British Columbia location and are subject to the additional risks of starting an agricultural business.\nCannabis cultivation and processing, can significantly influence the demand for agricultural equipment. Changing demand for certain agricultural\nproducts could have an effect on the price of farming output and consequently the demand for certain of our equipment and could also\nresult in higher research and development costs related to changing machine requirements. Additionally, cannabis cultivation dynamics\nis similar to that of other agricultural commodities cultivation dynamics in that failure to deliver quality products that meet customer\nneeds at competitive prices ahead of competitors could have a significant adverse effect on the Company’s business. Our business\nresults, therefore, depends on our ability to understand and anticipate our customers’ specific preferences and requirements, and\npreplan and cultivate cannabis products accordingly to meet such customer demand.\n\n** **\n\n**Our business will be reliant upon third\nparty suppliers, service providers and distributors.**\n\n \n\nAs our business grows, we\nwill need a supply chain for certain material portions of the production and distribution process of our products. Our suppliers, service\nproviders and distributors may elect, at any time, to breach or otherwise cease to participate in supply, service or distribution agreements,\nor other relationships, on which our operations rely. Loss of our suppliers, service providers or distributors would have a material\nadverse effect on our business and operational results.\n\n \n\nPart of our strategy is\nto enter into and maintain arrangements with third parties related to the development, testing, marketing, manufacturing, distribution\nand commercialization of our products. Our revenues are dependent on the successful efforts of these third parties, including the efforts\nof our distribution partners. Entering into strategic relationships can be a complex process and the interests of our distribution partners\nmay not be or remain aligned with our interests. Some of our current and future distribution partners may decide to compete with us,\nrefuse or be unable to fulfill or honor their contractual obligations to us, or change their plans to reduce their commitment to, or\neven abandon, their relationships with us. There can be no assurance that our distribution partners will market our products successfully\nor that any such third-party collaboration will be on favorable terms.\n\n** **\n\n5\n\n \n\n \n\nOur profit margins and the\ntimely delivery of our products are dependent upon the ability of our outside suppliers and manufacturers to supply us with products\nin a timely and cost-efficient manner. Our ability to develop our business and enter new markets and sustain satisfactory levels of sales\nin each market depends upon the ability of our outside suppliers and manufacturers to produce the ingredients and products and to comply\nwith all applicable regulations. The failure of our primary suppliers or manufacturers to supply ingredients or produce our products\ncould adversely affect our business operations.\n\n** **\n\n**There is no assurance that our sales and\npromotional activities will be successful.**\n\n \n\nOur future growth and profitability\nwill depend on the effectiveness and efficiency of sales and promotional expenditures, including our ability to (i) achieve the\nnecessary licenses and regulatory approvals for our cultivation facility, (ii) determine the appropriate creative message and media\nmix for future marketing expenditures and (iii) effectively manage cultivation and processing costs in order to maintain acceptable\noperating margins. There can be no assurance that our sales and promotional expenditures will result in revenues in the future or will\ngenerate awareness of our products and services. In addition, no assurance can be given that we will be able to manage our sales and\npromotional expenditures on a cost-effective basis.\n\n \n\nWe believe that maintaining\nand promoting our brand is critical to expanding our customer base. Maintaining and promoting our brand will depend largely on our ability\nto provide quality, reliable and innovative products, which we may not do successfully. We may introduce new products or services that\nour customers do not like, which may negatively affect our brand and reputation. Maintaining and enhancing our brand may require us to\nmake substantial investments, and these investments may not achieve the desired goals. If we fail to successfully promote and maintain\nour brand or if we incur excessive expenses in this effort, our business and financial results from operations could be materially adversely\naffected.\n\n \n\n**We may be unable to sustain our planned\npricing models.**\n\n \n\nOnce we expect to commence\ncultivation of our products, significant price fluctuations or shortages in the cost of materials may increase our cost of goods sold\nand cause our results of operations and financial condition to suffer. If we are unable to secure materials at a reasonable price, we\nmay have to alter or discontinue selling some of our products or attempt to pass along the cost to our customers, any of which could\nadversely affect our results of operations and financial condition.\n\n \n\nAdditionally, increasing\ncosts of labor, freight and energy could increase our and our suppliers’ cost of goods. If our suppliers are affected by increases\nin their costs of labor, freight and energy, they may attempt to pass these cost increases on to us. If we pay such increases, we may\nnot be able to offset them through increases in its pricing, which could adversely affect our results of operations and financial condition.\n\n** **\n\n**We may be unable to effectively manage\nfuture growth.**\n\n \n\nWe may be subject to growth-related\nrisks, including capacity constraints and pressure on our internal systems and controls. Our ability to manage growth effectively will\nrequire us to continue to implement and improve our operational and financial systems and to expand, train and manage our employee base.\nRapid growth of our business may significantly strain our management, operations and technical resources. If we are successful in obtaining\nlarge orders for our products once we commence cultivation, we will be required to deliver large volumes of products to our customers\non a timely basis and at a reasonable cost. We may not obtain large-scale orders for our products and if we do, we may not be able to\nsatisfy large-scale production requirements on a timely and cost-effective basis. Our inability to deal with this growth may have a material\nadverse effect on our business, financial condition, results of operations and prospects.\n\n** **\n\n**We are subject to significant competition\nby new and existing competitors in the cannabis industry.**\n\n \n\nThe industry in which we\noperate and intend to operate is subject to intense and increasing competition. Many of our competitors have greater resources that may\nenable them to compete more effectively than us in the cannabis industry, or they have a longer operating history and greater capital\nresources and facilities, which may enable them to compete more effectively in this market. We expect to face additional competition\nfrom existing licensees and new market entrants who are granted licenses in the jurisdictions in which we operate or intend to operate.\nIf a significant number of new licenses are granted in the near term, we may experience increased competition for market share and may\nexperience downward pricing pressure on our products as new entrants increase production. Such competition may cause us to encounter\ndifficulties in generating revenues and market share, and in positioning our products in the market. If we are unable to successfully\ncompete with existing companies and new entrants to the market, our lack of competitive advantage will have a negative effect on our\nbusiness and financial condition.\n\n** **\n\n**We could be subject to a security breach\nthat could result in significant damage or theft of products and equipment.**\n\n \n\nBreaches of security at\nour British Columbia facilities may occur and could result in damage to or theft of products and equipment. A security breach at our\nBritish Columbia facilities could result in a significant loss of inventory or work in process, expose us to liability under applicable\nregulations and increase expenses relating to the investigation of the breach and implementation of additional preventative security\nmeasures, any of which could have an adverse effect on our business, financial condition and results of operations.\n\n** **\n\n6\n\n \n\n \n\n**Risks Related to Our International Operations**\n\n** **\n\n**As a company based outside of the United\nStates, we are subject to economic, political, regulatory and other risks associated with international operations.**\n\n \n\nOur business is subject\nto risks associated with conducting business outside of the United States. Our operations are based primarily in Canada and Mexico. Accordingly,\nour future results could be harmed by a variety of factors, including, without limitation, the following:\n\n** **\n\n \n**●**\neconomic weakness, including\ninflation, or political instability in non-U.S. economies and markets;\n\n \n\n \n●\ndiffering and changing\nregulatory requirements for product licenses and approvals;\n\n \n\n \n●\ndiffering jurisdictions\ncould present different issues for securing, maintaining or obtaining freedom to operate in such jurisdictions;\n\n \n\n \n●\ndifficulties in compliance\nwith different, complex and changing laws, regulations and court systems of multiple jurisdictions and compliance with a wide variety\nof foreign laws, treaties and regulations;\n\n \n\n \n●\nchanges in applicable non-U.S.\nregulations and customs, tariffs and trade barriers;\n\n \n\n \n●\nchanges in applicable non-U.S.\ncurrency exchange rates and currency controls;\n\n \n\n \n●\nchanges in a specific country’s or region’s political or economic environment;\n\n \n\n \n●\ntrade protection measures,\nimport or export licensing requirements or other restrictive actions by governments;\n\n \n\n \n●\ndiffering reimbursement\nregimes and price controls in certain non-U.S. markets;\n\n \n\n \n●\nnegative consequences from\nchanges in tax laws;\n\n \n\n \n●\ncompliance with applicable\ntax, employment, immigration and labor laws for employees living or traveling abroad, including, for example, the variable tax treatment\nin different jurisdictions of options granted under our share option schemes or equity incentive plans;\n\n \n\n \n●\nworkforce uncertainty in\ncountries where labor unrest is more common than in the United States;\n\n \n\n \n●\ndifficulties associated\nwith staffing and managing international operations, including differing labor relations;\n\n \n\n \n●\nproduction shortages resulting\nfrom any events affecting raw material supply or manufacturing capabilities abroad; and\n\n \n\n \n●\nbusiness interruptions\nresulting from geo-political actions, including war and terrorism, or natural disasters, including droughts, floods and fires.\n\n \n\n7\n\n \n\n \n\n **Political, social and geopolitical\nconditions can adversely affect our existing and planned business.**\n\n \n\nPolitical, social and geopolitical\nconditions in the markets in which our products are expected to be sold have been and could continue to be difficult to predict, resulting\nin adverse effects on our business. The results of elections, referendums or other political conditions (including government shutdowns),\ngeopolitical events and tensions, wars and other military conflicts in these markets have in the past impacted and could continue to\nimpact how existing laws, regulations and government programs or policies are implemented or result in uncertainty as to how such laws,\nregulations, programs or policies may change, including with respect to the negotiation of new trade agreements, new, expanded or retaliatory\ntariffs against certain countries or covering certain products or ingredients, sanctions, environmental and climate change regulations,\ntaxes, benefit programs, the movement of goods, services and people between countries, relationships between countries, customer or consumer\nperception of a particular country or its government and other matters. Such conditions have resulted in and could continue to result\nin exchange rate fluctuation, limitations on access to credit markets and other corporate banking services, including working capital\nfacilities, volatility in global stock markets and global economic uncertainty and heightened risk to employee safety, any of which can\nadversely affect our existing and planned business.\n\n** **\n\n**Political uncertainty may have an adverse\nimpact on our operating performance and results of operations.**\n\n** **\n\nGeneral political uncertainty\nmay have an adverse impact on our operating performance and results of operations. In particular, the U.S. and the world at large continue\nto experience significant political events that cast uncertainty on global financial and economic markets. It is presently unclear as\nto all of the actions the second Trump administration in the U.S. will implement, and if implemented, how these actions may impact us\nor how we intend to operate in or with the U.S. Any actions taken by the Trump administration, including the many recent executive orders,\nmay have a negative impact on the U.S. or World economy in general and on our business, financial condition, and results of operations\nin particular. Political, social and geopolitical conditions can adversely affect our existing and planned business.\n\n \n\n**We may seek international sales in the\nfuture, and such sales may be subject to unexpected exchange rate fluctuations, regulatory requirements and other barriers.**\n\n \n\nWe currently expect that\nany sales we may have will be denominated in U.S. Dollars or Mexican Pesos and that we may, in the future, have sales denominated in the\ncurrencies of additional countries in which we may establish operations or distribution. In addition, we expect to incur the majority\nof our operating expenses in U.S. Dollars and Canadian Dollars. Our international sales may be subject to unexpected regulatory requirements\nand other barriers. Any fluctuation in the exchange rates of foreign currencies may negatively affect our business, financial condition\nand results of operations. We have not previously engaged in foreign currency hedging. If we decide to hedge our foreign currency exposure,\nwe may not be able to hedge effectively due to lack of experience, unreasonable costs or illiquid markets. In addition, those activities\nmay be limited in the protection they provide from foreign currency fluctuations and can themselves result in losses.\n\n** **\n\n**Tax regulations and challenges by tax authorities\ncould have a material adverse effect on our business.**\n\n** **\n\nWe expect to operate in\na number of countries and will therefore be regularly examined by and remain subject to numerous tax regulations. Changes in our global\nmix of earnings could affect our effective tax rate. Furthermore, changes in tax laws could result in higher tax-related expenses and\npayments. Legislative changes in any of the countries in which we operate could materially impact our tax receivables and liabilities\nas well as deferred tax assets and deferred tax liabilities. Additionally, the uncertain tax environment in some regions in which we\noperate may limit our ability to successfully challenge an adverse determination by any local tax authorities. We expect to operate in\ncountries with complex tax rules, which may be interpreted in a variety of ways and could affect our effective tax rate. Future interpretations\nor developments of tax regimes or a higher than anticipated effective tax rate could have a material adverse effect on our tax liability,\nreturn on investments and business operations.\n\n \n\n8\n\n \n\n \n\nIn addition, our subsidiaries\noperate in, are incorporated in and are tax residents of, various jurisdictions. The tax authorities in the various jurisdictions in\nwhich we and our subsidiaries operate, or are incorporated, may disagree with and challenge our assessments of our transactions, tax\nposition, deductions, exemptions, where we or our subsidiaries are tax resident, or other matters. If we are unsuccessful in responding\nto any such challenge from a tax authority, we may be required to pay additional taxes, interest, fines or penalties, we may be subject\nto taxes for the same business in more than one jurisdiction or may also be subject to higher tax rates, withholding or other taxes.\nA successful challenge could potentially result in payments to the relevant tax authority of substantial amounts that could have a material\nadverse effect on our financial condition and results of operations.\n\n \n\nEven if we are successful\nin responding to challenges by taxing authorities, responding to such challenges may be expensive, consume time and other resources,\nor divert management’s time and focus from our business operations. Therefore, a challenge as to our tax position or status or\ntransactions, even if unsuccessful, may have a material adverse effect on our business, financial condition, results of operations or\nliquidity or the business, financial condition, and results of operations.\n\n** **\n\n**We face the risk of disruption from labor\ndisputes and changes to labor laws, which could result in significant additional operating costs or alter our relationship with our employees.**\n\n \n\nWe are required to comply\nwith extensive labor regulations in each of the countries in which we have employees, including with respect to wages, social security\nbenefits and termination payments. Labor or employee led disruptions could have a material adverse effect on our business, results of\noperations and financial condition.\n\n** **\n\n**Risks Related to our Cannabis Regulatory Framework**\n\n** **\n\n**The cannabis regulatory regime is relatively\nnew in Canada, and laws and enforcement could rapidly change again.**\n\n \n\nIn Canada, cannabis regulation\nis primarily managed by individual provinces and territories, although the federal government sets the framework through the Cannabis\nAct. Each province or territory has its own regulatory agency responsible for the sale, distribution, and use of cannabis within its\njurisdiction. From a federal perspective, Health Canada is responsible for administering the federal regulatory program for cannabis\nproduction and medical purposes, including granting licenses, setting licensure requirements, and enforcing compliance.\n\n \n\nOn September 5, 2024, Akanda’s\nwholly-owned subsidiary, 1468243 B.C. Ltd., was issued a hemp license by Health Canada to propagate industrial hemp. The license is valid\nthrough September 5, 2027.\n\n \n\nOur activities are, and\nwill continue to be, subject to evolving regulation by governmental authorities. Due to the current regulatory environment in Canada,\nnew risks may emerge; management may not be able to predict all such risks.\n\n \n\nOur activities are, and\nwill continue to be, subject to evolving regulation by governmental authorities.\n\n** **\n\n**Cannabis laws, regulations, and guidelines\nare dynamic and subject to changes.**\n\n \n\nCannabis laws and regulations\nare dynamic and subject to evolving interpretations which could require us to incur substantial costs associated with compliance or alter\ncertain aspects of our business plan. It is also possible that regulations may be enacted in the future that will be directly applicable\nto certain aspects of our businesses. We cannot predict the nature of any future laws, regulations, interpretations or applications,\nnor can we determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated,\ncould have on our business. Management expects that the legislative and regulatory environment in the cannabis industry in the Canada\nand internationally will continue to be dynamic and will require innovative solutions to try to comply with this changing legal landscape\nin this nascent industry for the foreseeable future. Failure to comply with any such legislation may have a material adverse effect on\nour business, financial condition and results of operations.\n\n \n\nPublic opinion can also\nexert a significant influence over the regulation of the cannabis industry. A negative shift in the public’s perception of the\ncannabis industry could affect future legislation or regulation in different jurisdictions.\n\n** **\n\n9\n\n \n\n \n\n**There are risks associated with the regulatory\nregime and permitting requirements of our operations.**\n\n \n\nAchievement of our business\nobjectives is contingent, in part, upon compliance with regulatory requirements enacted by governmental authorities and obtaining all\nregulatory approvals, where necessary, for the cultivation, processing and sale of our products. Our wholly-owned subsidiary, 1468243\nB.C. Ltd., currently holds a hemp license for propagating industrial hemp. We may not be able to obtain or maintain the necessary licenses,\npermits, quotas, authorizations, certifications or accreditations to operate our business going forward, or may only be able to do so\nat great cost. We cannot predict the time required to secure all appropriate regulatory approvals for our products, or the extent of\ntesting and documentation that may be required by local governmental authorities.\n\n \n\nOur officers and directors\nmust rely, to a great extent, on our local legal counsel and local consultants retained in the Canada in order to keep abreast of material\nlegal, regulatory and governmental developments as they pertain to and affect our business operations, and to assist us with governmental\nrelations. We must rely, to some extent, on those members of management and the Board who have previous experience working and conducting\nbusiness in the Canada in order to enhance our understanding of and appreciation for the local business culture and practices in such\njurisdictions.\n\n \n\nWe also rely on the advice\nof local experts and professionals in connection with any current and new regulations that develop in respect of banking, financing and\ntax matters in the jurisdictions in which we operate. Any developments or changes in such legal, regulatory or governmental requirements\nor in local business practices in such jurisdictions are beyond our control and may adversely affect our business.\n\n  \n\nWe will incur ongoing costs\nand obligations related to regulatory compliance. Failure to comply with applicable laws, regulations and permitting requirements may\nresult in enforcement actions thereunder, including orders issued by regulatory or judicial authorities causing operations to cease or\nbe curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial actions.\nWe may be required to compensate those suffering loss or damage by reason of our operations and may have civil or criminal fines or penalties\nimposed for violations of applicable laws or regulations. In addition, changes in regulations, more vigorous enforcement thereof or other\nunanticipated events could require extensive changes to our operations, increased compliance costs or give rise to material liabilities,\nwhich could have a material adverse effect on our business, results of operations and financial condition.\n\n \n\n**Any failure on our part to comply with\napplicable regulations or to obtain and maintain the necessary licenses and certifications could prevent us from being able to carry\non our business, and there may be additional costs associated with any such failure.**\n\n \n\nOur business activities\nare heavily regulated in all jurisdictions where we do business. Our operations are subject to various laws, regulations and guidelines\nby governmental authorities relating to the cultivation, processing, manufacture, marketing, management, distribution, transportation,\nstorage, sale, packaging, labelling, pricing and disposal of cannabis and cannabis products. In addition, we are subject to laws and\nregulations relating to employee health and safety, insurance coverage and the environment. Laws and regulations, applied generally,\ngrant government agencies and self-regulatory bodies broad administrative discretion over our activities, including the power to limit\nor restrict business activities as well as impose additional disclosure requirements on our products and services.\n\n \n\nAny failure by us to comply\nwith applicable regulatory requirements could:\n\n \n\n \n●\nrequire extensive changes\nto our operations;\n\n \n\n \n●\nresult in regulatory or\nagency proceedings or investigations;\n\n \n\n10\n\n \n\n \n\n \n●\nresult in the revocation\nof our licenses and permits, the imposition of additional conditions on licenses to operate our business, and increased compliance\ncosts;\n\n \n\n \n●\nresult in product recalls\nor seizures;\n\n \n\n \n●\nresult in damage awards,\ncivil or criminal fines or penalties;\n\n \n\n \n●\nresult in the suspension\nor expulsion from a particular market or jurisdiction of our key personnel;\n\n \n\n \n●\nresult in restrictions\non our operations or the imposition of additional or more stringent inspection, testing and reporting requirements;\n\n \n\n \n●\nharm our reputation; or\n\n \n\n \n●\ngive rise to material liabilities.\n\n \n\nThere can be no assurance\nthat any future regulatory or agency proceedings, investigations or audits will not result in substantial costs, a diversion of management’s\nattention and resources or other adverse consequences to our business.\n\n \n\nIn addition, changes in\nregulations, government or judicial interpretation of regulations, or more vigorous enforcement thereof or other unanticipated events\ncould require extensive changes to our operations, increase compliance costs or give rise to material liabilities or a revocation of\nour licenses and other permits. Furthermore, governmental authorities may change their administration, application or enforcement procedures\nat any time, which may adversely affect our ongoing regulatory compliance costs. There is no assurance that we will be able to comply\nor continue to comply with applicable regulations.\n\n \n\n**The legal cannabis market is a relatively\nnew industry. As a result, the size of our target market is difficult to quantify, and investors will be reliant on their own estimates\non the accuracy of market data.**\n\n \n\nBecause the cannabis industry\nis in a nascent stage, there is a lack of information about comparable companies available for potential investors to review in deciding\nwhether to invest in us and, few, if any, established companies whose business model we can follow or upon whose success we can build.\nAccordingly, investors should rely on their own estimates regarding the potential size, economics and risks of the cannabis market in\ndeciding whether to invest in our Common Shares. We are an early-stage company that has not generated net income. There can be no assurance\nthat our growth estimates are accurate or that the cannabis market will be large enough for our business to grow as projected.\n\n \n\nAlthough we are committed\nto researching and developing new markets and products and improving existing products, there can be no assurances that such research\nand market development activities will prove profitable or that the resulting markets or products, if any, will be commercially viable\nor successfully produced and marketed. We must rely largely on our own market research to forecast sales and design products as detailed\nforecasts and consumer research are not generally obtainable from reliable third-party sources in the United Kingdom, the European market,\nCanada and in other international jurisdictions.\n\n \n\nIn addition, there is no\nassurance that the industry and market will continue to exist and grow as currently estimated or anticipated or function and evolve in\nthe manner consistent with management’s expectations and assumptions. We could also be subject to other events or circumstances\nthat adversely affect the cannabis industry, such as the imposition of further restrictions on sales and marketing or further restrictions\non sales in certain areas and markets. In this respect, we may determine that exiting the industry is in the best financial interests\nof the Company and may undertake all necessary actions to effectuate a shift to another industry.\n\n \n\n11\n\n \n\n \n\n**U.S. federal law has changed, but Marijuana remains a controlled\nsubstance.**\n\n \n\nAlthough the legal framework\nis changing, there are significant legal restrictions and regulations that govern the cannabis industry in the United States. Some forms\nof marijuana remain a Schedule I drug under the Controlled Substances Act, making it illegal under federal law in the United States to,\namong other things, cultivate, distribute or possess cannabis in the United States. As of 2024, 47 states, the District of Columbia,\nand the U.S. Territories of Guam, Puerto Rico, and the U.S. Virgin Island allow the of cannabis for medical purposes. 24 states and the\nDistrict of Columbia have legalized cannabis for recreational purposes. In those states in which the use of marijuana has been legalized,\nits use remains a violation of federal law pursuant to the Controlled Substances Act. The Controlled Substances Act presently classifies\nmarijuana in general as a Schedule I controlled substance, however, marijuana or marijuana products approved by the Food & Drug Administration\n(FDA) or subject to a state-issued medical license has been rescheduled to Schedule III as of April 28, 2026.\n\n \n\nOn December 18, 2025, President\nTrump signed an executive order directing the Attorney General to expedite the reclassification of cannabis from a Schedule 1 to a Schedule\nIII substance under the Controlled Substance Act. On April 23, 2026, the Department of Justice issued an order rescheduling medical marijuana,\nenabling its export or import by permit, and establishing a DEA registration process for entities holding state medical licenses. A new\nhearing on June 29, 2026 will evaluate broader changes to marijuana’s status under U.S. federal law.\n\n \n\nWhile the order does not\nfederally legalize marijuana or its recreational use, it marks a significant policy shift by formally recognizing the drug’s potential\nmedical value for the first time in over 50 years. Schedule III indicates evidence supporting accepted medical use and the moderate to\nlow potential for physical and psychological dependence. The primary implications of rescheduling are: (a) the elimination of IRS Section\n280E which enables state-legal cannabis business to deduct standard operating expenses from their federal taxes, (b) reduced administrative\nand regulatory barriers for clinical trials, (c) a pathway for the FDA to develop federal standards for product quality, labeling accuracy,\nand consumer protection, (e) reduced legal risks for financial institutions, (f) the listing of U.S. medicinal cannabis companies on\nU.S. stock exchanges, and (g) federal de-prioritization on non-violent marijuana offenses. Rescheduling, nonetheless, does not permit\ninterstate commerce of cannabis within the United States, nor does it override state laws criminalizing marijuana use or provide full\nbanking protections for financial institutions providing traditional services to the U.S. cannabis market. As part of the executive order,\na pilot program was established for Medicare beneficiaries to receive up to $500 annually for doctor-recommended CBD products starting\nin 2026.\n\n \n\nHowever, until marijuana\nin all its forms is rescheduled by the Attorney General and until the regulatory framework with respect to marijuana adapts to these\nrecent and future changes, there is a risk that federal authorities may enforce current federal law. Financial transactions involving\nproceeds generated by, or intended to promote, cannabis-related business activities in the United States may form the basis for prosecution\nunder applicable U.S. federal money laundering legislation. While the approach to enforcement of such laws by the federal government\nin the United States has trended toward non-enforcement against individuals and businesses that comply with medical or adult-use cannabis\nregulatory programs in states where such programs are legal, strict compliance with state laws with respect to cannabis will neither\nabsolve us of liability under U.S. federal law, nor will it provide a defense to any federal proceeding which may be brought against\nus should we expand our operations into the U.S.  However, since U.S. federal law criminalizing the use of marijuana pre-empts state\nlaws that legalize its use, enforcement of federal law regarding marijuana may be a significant risk and could greatly harm our business,\nprospects, revenue, results of operation and financial condition if we were to expand our operations into the United States. We currently\nhave no operations in the United States and no current plans to expand our operations into the United States in the foreseeable future.\n\n \n\nOur activities are, and\nwill continue to be, subject to evolving regulation by governmental authorities. The legality of the production, cultivation, extraction,\ndistribution, retail sales, transportation and use of cannabis differs among states in the United States. Due to the current regulatory\nenvironment in the United States, new risks may emerge; management may not be able to predict all such risks. Due to the conflicting\nviews between state legislatures and the federal government regarding cannabis, cannabis businesses are subject to inconsistent laws\nand regulations. There can be no assurance that the federal government will not enforce federal laws relating to marijuana and seek to\nprosecute cases involving marijuana businesses that are otherwise compliant with state laws in the future. To date, federal enforcement\nagencies have taken little or no action against state-compliant cannabis businesses in the United States. However, the DOJ may change\nits enforcement policies at any time, with or without advance notice. The uncertainty of U.S. federal enforcement practices going forward\nand the inconsistency between U.S. federal and state laws and regulations may present risks for us if we expand our operations into the\nUnited States in the future; however the reclassification to Schedule III, the possibility of a future FDA medicinal regulatory framework\nfor cannabis, and future hearings on the broader status of marijuana under U.S. federal law, reduces some of this uncertainty.\n\n** **\n\n12\n\n \n\n \n\n**Risks Related to Financials and Accounting**\n\n** **\n\n**Our financial situation creates doubt as\nto whether we will continue as a going concern.**\n\n** **\n\nAkanda\ndid not generate material revenues in 2025, as a result of shutting down its Canmart operations, and does not of yet generate any revenues\nfrom its British Columbia farming facility. Furthermore, although Akanda is generating revenues as a result of its 2025 acquisition of\nFirst Towers, there can be no assurances that we will be able to achieve a level of revenues adequate to generate sufficient cash flow\nfrom operations or obtain funding from additional financing through private placements, public offerings and/or bank financing necessary\nto support our working capital requirements. \n\n \n\nTo\nthe extent that revenue generated by our First Towers subsidiary, and funds generated from any private placements, public offerings and/or\nbank financing, are insufficient, we will have to raise additional working capital. No assurance can be given that our revenues will\nincrease or that additional financing will be available, or if available, will be on acceptable terms. These conditions raise substantial\ndoubt about our ability to continue as a going concern. If adequate working capital is not available, we may be forced to discontinue\noperations, which would cause investors to lose their entire investment. \n\n \n\n**Akanda will require additional financing\nand cannot be certain that such additional financing will be available on reasonable terms when required, or at all.**\n\n  \n\nTo date, Akanda has relied\nprimarily on equity and debt financing to carry on its business. Akanda has limited financial resources and operating cash flow and can\nmake no assurance that sufficient funding will be available to it to fund its operating expenses and to further develop its business.\n\n \n\nAny additional financing\nmay involve substantial dilution for the existing shareholders. There can be no assurance that such additional capital will be available,\non a timely basis or on acceptable terms. Failure to obtain such additional financing could result in delay or indefinite postponement\nof operations or the further development of its business with the possible loss of such properties or assets. If adequate funds are not\navailable or are not available on acceptable terms, Akanda may not be able to fund its business or the expansion thereof, take advantage\nof strategic acquisitions or investment opportunities or respond to competitive pressures. Such inability to obtain additional financing\nwhen needed could have a Material Adverse Effect on its business, financial condition and results of operations.\n\n \n\n**We are subject to significant accounts\npayable and other current liabilities.**\n\n \n\nWe have total current liabilities\nof $6,199,365 as of December 31, 2025. We may also incur indebtedness from time to time to fund operations, which have historically been\nconverted into equity but in the future may be required to be repaid at maturity. Our operations are not currently able to generate sufficient\ncash flows to meet our payable and other liabilities, which could reduce our financial flexibility, increase interest expenses, and adversely\nimpact our operations. We have not historically generated sufficient cash flow from operations to enable us to repay indebtedness and\nto fund other liquidity needs, including capital expenditure requirements. Such indebtedness could affect our operations in several ways,\nincluding the following:\n\n \n\n●a\nsignificant portion of our cash flows could be required to be used to service such indebtedness.\n\n \n\n●a\nhigh level of indebtedness could increase our vulnerability to general adverse economic and\nindustry conditions.\n\n \n\n●any\ncovenants contained in the agreements governing such outstanding indebtedness could limit\nour ability to borrow additional funds, dispose of assets, pay dividends and make certain\ninvestments.\n\n \n\n●a\nhigh level of indebtedness may place us at a competitive disadvantage compared to our competitors\nthat are less leveraged and, therefore, our competitors may be able to take advantage of\nopportunities that our indebtedness may prevent us from pursuing.\n\n \n\n●debt\ncovenants may affect our flexibility in planning for, and reacting to, changes in the economy\nand in our industry, if any; and\n\n \n\n●any\nability to convert or exchange such indebtedness for equity in the Company can cause substantial\ndilution to existing stockholders of the Company.\n\n \n\n13\n\n \n\n \n\n**Changes in accounting standards and subjective\nassumptions, estimates and judgments by management related to complex accounting matters could significantly affect our financial results.**\n\n** **\n\nAccounting principles generally\naccepted in IFRS and related pronouncements, implementation of guidelines and interpretations with regard to a wide variety of matters\nthat are relevant to our businesses, such as, but not limited to, revenue recognition, stock-based compensation, trade promotions, and\nincome taxes, are highly complex and involve many subjective assumptions, estimates and judgments by our management. Changes to these\nrules or their interpretation or changes in underlying assumptions, estimates or judgments by our management could significantly change\nour reported results.\n\n \n\n**Our subsidiary, Bophelo, is currently in\ninsolvency proceedings.**\n\n \n\nOur indirect wholly-owned\nsubsidiary, Bophelo, was placed into liquidation by the High Court of Lesotho (the “Lesotho Court”) in July 2022 pursuant\nto an unauthorized application and request (the “Liquidation Application”) that was filed by Louisa Mojela, our former Executive\nChairman, who was terminated as Executive Chairman of Akanda, and the Mophuti Matsoso Development Trust (“MMD Trust”), which\nwe believe was established by Ms. Mojela. Mr. Chavonnes Cooper of Cape Town, South Africa, was appointed by the Lesotho Court as liquidator\nof Bophelo for purposes of maintaining the value of the assets owned or managed by Bophelo. While we intend to contest and seek to reverse\nthe determination by the Lesotho Court to place Bophelo in liquidation, and will seek to recover significant loans made to Bophelo to\nfund the execution of Bophelo’s business plan, including payment of rents and staffing costs in the event that the Lesotho Court\ndoes not reverse its determination to place Bophelo in liquidation, there can be no assurance that we will be successful in reversing\nthe Lesotho Court’s determination to place Bophelo in liquidation.\n\n \n\nAs a result of Bophelo’s liquidation, during\nthe year ended December 31, 2022, Bophelo ceased operations and we derecognized its assets and have since determined that it is no longer\na significant subsidiary. We will continue to report about Bophelo, until such time as our inquiry into the liquidation confirms that\nthe process is complete.\n\n** **\n\n**There are tax risks we may be subject to\nin carrying out our business in multiple jurisdictions.**\n\n \n\nWe will operate and, accordingly,\nwill be subject to income tax and other forms of taxation in multiple jurisdictions. We may be subject to income taxes and non-income\ntaxes in a variety of jurisdictions and our tax structure may be subject to review by both domestic and foreign taxation authorities.\nThose tax authorities may disagree with our interpretation and/or application of relevant tax rules. A challenge by a tax authority in\nthese circumstances might require us to incur costs in connection with litigation against the relevant tax authority or reaching a settlement\nwith the tax authority and, if the tax authority’s challenge is successful, could result in additional taxes (perhaps together\nwith interest and penalties) being assessed on us, and as a result an increase in the amount of tax payable by us. In addition, we may\nbe subject to different taxes imposed by the local governments in the jurisdictions where we operate, and changes within such tax, legal\nand regulatory framework may have an adverse effect on our financial results.\n\n \n\nTaxation laws and rates\nwhich determine taxation expenses may vary significantly in different jurisdictions, and legislation governing taxation laws and rates\nare also subject to change. Therefore, our earnings may be affected by changes in the proportion of earnings taxed in different jurisdictions,\nchanges in taxation rates, changes in estimates of liabilities and changes in the amount of other forms of taxation. The determination\nof our provision for income taxes and other tax liabilities will require significant judgment (including based on external advice) as\nto the interpretation and application of these rules. We may have exposure to greater than anticipated tax liabilities or expenses.\n\n \n\n**There is a risk that we will be a passive\nforeign investment company (“PFIC”) for U.S. federal income tax purposes for the current or any future taxable year,\nwhich could result in material adverse U.S. federal income tax consequences if you are a U.S. Holder.**\n\n \n\nIf we (or any of our non-U.S.\nsubsidiaries) are a PFIC for any taxable year during which a U.S. Holder owns Common Shares, certain adverse U.S. federal income\ntax consequences could apply to such U.S. Holder. The determination of whether a corporation is a PFIC for a taxable year depends,\nin part, on the application of complex U.S. federal income tax rules that are subject to differing interpretations. In addition,\nthe determination of whether a corporation will be a PFIC for any taxable year generally can only be made after the close of such\ntaxable year. Therefore, it is possible that we could be classified as a PFIC for our initial taxable year or in future years\ndue to changes in the nature of our business, composition of our assets or income, as well as changes in our market capitalization. In\nparticular, our PFIC status will depend, in part, on the amount of cash that we raise and how quickly we utilize the cash in our business.\nBased upon the foregoing, it is uncertain whether we will be a PFIC for our current taxable year or any future taxable year.\nWe have not determined, if we (or any of our non-U.S. subsidiaries) were to be classified as a PFIC for a taxable year, whether\nwe will provide information necessary for a U.S. Holder to make a “qualified electing fund” election which, if available,\nwould result in tax treatment different from (and generally less adverse than) the general tax treatment for PFICs. Accordingly, U.S.\nHolders should assume that they will not be able to make a qualified electing fund election with respect to our Common Shares. The PFIC\nrules are complex, and each U.S. Holder should consult his, her or its own tax advisor regarding the PFIC rules, the elections which\nmay be available, and how the PFIC rules may affect the U.S. federal income tax consequences relating to the ownership and disposition\nof our Common Shares.\n\n** **\n\n14\n\n \n\n \n\n**Failure to develop our internal controls\nover financial reporting as we grow could have an adverse effect on our operations.**\n\n \n\nAs we mature, we will need\nto continue to develop and improve our current internal control systems and procedures to manage our growth. We are required to establish\nand maintain appropriate internal controls over financial reporting. Failure to establish appropriate controls, or any failure of those\ncontrols once established, could adversely affect our public disclosures regarding our business, financial condition or results of operations.\nIn addition, management’s assessment of internal controls over financial reporting may identify weaknesses and conditions that\nneed to be addressed in our internal controls over financial reporting or other matters that may raise concerns for investors.\n\n \n\n**Risks Related to Our Common Shares**\n\n** **\n\n**We will need to raise additional funding,\nwhich may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay,\nlimit or terminate our product and business development efforts or other operations.**\n\n \n\nWe need to seek additional\nfunds, through public or private equity or debt financings, government or other third-party funding, marketing and distribution arrangements\nand other collaborations, strategic alliances or a combination of these approaches. Raising funds in the current economic environment\nmay present additional challenges. It is not certain that we have accounted for all costs and expenses of future development and regulatory\ncompliance. Even if we believe we have sufficient funds for our current or future operating plans, we may seek additional capital if\nmarket conditions are favorable or if we have specific strategic considerations.\n\n \n\nAny additional fundraising\nefforts may divert the attention of our management team from their day-to-day activities, which may adversely affect our ability to launch\nour business and develop and commercialize our products. In addition, we cannot guarantee that future financing will be available in\nsufficient amounts or on terms acceptable to us, if at all. Moreover, the terms of any future financing may adversely affect the holdings\nor the rights of our shareholders, and the issuance of additional securities, whether equity or debt, by us, or the possibility of such\nissuance, may cause the market price of our shares to decline. The sale of additional equity or convertible securities may dilute our\nexisting shareholders.\n\n \n\nThe incurrence of indebtedness\nwould result in increased fixed payment obligations, and we may be required to agree to certain restrictive covenants, such as limitations\non our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other\noperating restrictions that could adversely affect our ability to conduct our business.\n\n \n\nWe could also be required\nto seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable and\nwe may be required to relinquish rights to some of our technologies or products or otherwise agree to terms unfavorable to us, any of\nwhich may have a material adverse effect on our business, operating results and prospects.\n\n \n\nIf we are unable to obtain\nfunding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our research or development\nprograms or the commercialization of any product, or be unable to expand our operations or otherwise capitalize on our business opportunities,\nas desired, which could materially affect our business, financial condition and results of operations.\n\n \n\n**Future sales and issuances of our capital\nstock or rights to purchase capital stock could result in additional dilution of the percentage ownership of our shareholders and\ncould cause the price of our Common Shares to decline.**\n\n** **\n\nWe may issue additional\nsecurities. Future sales and issuances of our capital stock or rights to purchase our capital stock could result in substantial dilution\nto our existing shareholders. We may sell Common Shares, convertible securities, and other equity securities in one or more transactions\nat prices and in a manner as we may determine from time to time. If we sell any such securities in subsequent transactions, investors\nmay be materially diluted. New investors in such subsequent transactions could gain rights, preferences, and privileges senior to those\nof holders of our Common Shares.\n\n** ** \n\n15\n\n \n\n \n\n**The Company has effected numerous reverse\nstock splits and may effect additional reverse stock splits in the future, which has in the past and could in the future have the effect\nof decreasing the liquidity of our Common Shares and further causing the Company’s stock price to decline relative to its value\nbefore the reverse stock split.**\n\n** **\n\nThe Company may strategically\neffect one or more additional reverse stock splits from time to time during 2026 or beyond; however, there can be no assurance that the\nCompany will so effect additional reverse stock splits or what the ratio(s) may be for any such reverse stock split(s). The Company’s\ndecision whether or not (and when) to effect additional reverse stock splits (and at what ratio to effect such reverse stock splits)\nwill be based on a number of factors, including market conditions, existing and anticipated trading prices for the Common Shares and\nthe requirements of the Nasdaq Capital Market. The Company has effected reverse stock splits when there is downward pressure on the trading\nprice of its Common Shares, sometimes as a result of the sale into the market of registered Common Shares upon the conversion of outstanding\nconvertible promissory notes.\n\n \n\nThe liquidity of the Common\nShares has in the past, and may in the future, be affected adversely by a reverse stock split given the reduced number of shares that\nwill be outstanding following a reverse stock split, especially if the market price of the Common Shares does not increase as a result\nof the reverse stock split. Although the Company believes that a higher market price of its Common Shares may help generate greater or\nbroader investor interest, the Company cannot assure you that a reverse stock split will result in a share price that will attract new\ninvestors and may instead carry the risk of dampening the overall attractiveness of the Company’s securities. In addition, the\nCompany’s reverse stock splits have increased the number of stockholders who own odd lots (less than 100 shares) of Common Shares,\ncreating the potential for such stockholders to experience an increase in the cost of selling their shares and greater difficulty effecting\nsuch sales.\n\n \n\nAny future reverse stock\nsplit can also cause a decline in the value of the Common Shares relative to its value before the reverse stock split, and the Company\ncan make no assurance that the market price of the Company’s Common Shares will remain at or above the post-split price on the\ncommencement of trading on its effective date, as many times stocks decrease in value after a reverse stock split.\n\n \n\nFinally, although the Company\ndoes not believe that its reverse stock splits have violated or any further reverse stock splits will violate any particular Nasdaq rules,\nand the Company further believes that it is in compliance with the Nasdaq listing standards, the Company can give no assurance that the\nCompany’s numerous prior reverse stock splits and potential future reverse stock splits will not result in Nasdaq issuing a deficiency\nnotice or even delisting the Company from the Nasdaq Capital Market, which would have a material adverse effect on our ability to raise\ncapital, the stock price and liquidity of the Common Shares, or the value of the Common Shares held by the Company’s shareholders.\n\n** **\n\n**We incur increased costs as a result of\noperating as a public company and our management is required to devote substantial time to new compliance initiatives.**\n\n \n\nAs a public company, particularly\nafter we are no longer an emerging growth company, we incur and will incur significant legal, accounting and other expenses that we did\nnot incur as a private company. In addition, the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, and rules implemented by\nthe SEC and Nasdaq, impose various requirements on public companies, including requirements to file periodic and event-driven reports\nwith respect to our business and financial condition and operations and establish and maintain effective disclosure and financial controls\nand corporate governance practices. Our management and other personnel have limited experience operating a public company, which may\nresult in operational inefficiencies or errors, or a failure to improve or maintain effective internal controls over financial reporting\n(“**ICFR**”) and disclosure controls and procedures necessary to ensure timely and accurate reporting of operational\nand financial results. Our existing management team will need to devote a substantial amount of time to these compliance initiatives,\nand we may need to hire additional personnel to assist us with compliance. Moreover, these rules and regulations will increase our\nlegal and financial compliance costs and will make some activities more time consuming and costly.\n\n \n\nPursuant to Section 404\nof the Sarbanes-Oxley Act (“**Section 404**”), we are required to furnish a report by our management on our\nICFR, which, after we are no longer an emerging growth company, must be accompanied by an attestation report on ICFR issued by our independent\nregistered public accounting firm. To achieve compliance with Section 404 within the prescribed period, we will document and evaluate\nour ICFR, which is both costly and challenging. In this regard, we will need to continue to dedicate internal resources, potentially\nengage outside consultants, and adopt a detailed work plan to assess and document the adequacy of our ICFR, continue steps to improve\ncontrol processes as appropriate, validate through testing that controls are functioning as documented, and implement a continuous reporting\nand improvement process for ICFR. If our management and/or auditors determine that there are one or more material weaknesses in our ICFR,\nsuch a determination could cause an adverse reaction in the financial markets due to a loss of confidence in the reliability of our consolidated\nfinancial statements.\n\n** **\n\n16\n\n \n\n \n\nIn addition, changing laws,\nregulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing\nlegal and financial compliance costs and making some public company required activities more time consuming. These laws, regulations\nand standards are subject to varying interpretations, in many cases due to their lack of specificity and, as a result, their application\nin practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty\nregarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We intend to\ninvest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative\nexpenses and divert management’s time and attention from revenue generating activities to compliance activities. If our efforts\nto comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies, regulatory\nauthorities may initiate legal proceedings against us and our business may be harmed.\n\n \n\nBeing a public company and\ncomplying with applicable rules and regulations make it more expensive for us to obtain director and officer liability insurance.\nThese factors could also make it more difficult for us to attract and retain qualified executive officers and members of our Board.\n\n \n\n**We may not be able to maintain a listing\nof our Common Shares on Nasdaq. If we fail to meet applicable listing requirements, Nasdaq may delist our Common Shares from trading,\nin which case the liquidity and market price of our Common Shares could decline.**\n\n \n\nSince 2022, we have received\nfour notifications of non-compliance from Nasdaq, the most recent being in May 2026 when we received a letter from the Listing Qualifications\nDepartment of Nasdaq, notifying us that we are not in compliance with the periodic filing requirements for continued listing set forth\nin Nasdaq Listing Rule 5250(c)(1) as a result of our failure to file our Annual Report on Form 20-F for the fiscal year ended December\n31, 2025 with the SEC by the required due date. We expect that we will again be in compliance with Nasdaq upon the filing of this Annual\nReport on Form 20-F.\n\n \n\nWe cannot assure you that we will be able to meet the continued listing\nstandards of Nasdaq in the future. If we fail to comply with the applicable listing standards and Nasdaq delists our Common Shares, we\nand our shareholders could face significant material adverse consequences, including:\n\n \n\n \n●\na limited availability\nof market quotations for our Common Shares;\n\n \n\n \n●\nreduced liquidity for our\nCommon Shares;\n\n \n\n \n●\na determination that our\nCommon Shares are “penny stock”, which would require brokers trading in our Common Shares to adhere to more stringent\nrules and possibly result in a reduced level of trading activity in the secondary trading market for our Common Shares;\n\n \n\n \n●\na limited amount of news\nabout us and analyst coverage of us; and\n\n \n\n \n●\na decreased ability for\nus to issue additional equity securities or obtain additional equity or debt financing in the future.\n\n \n\nThe Company can give no\nassurance that it will not again be subject to delisting as a result of non-compliance with any Nasdaq listing requirement.\n\n \n\n**We are a foreign private issuer and take\nadvantage of the less frequent and detailed reporting obligations applicable to foreign private issuers.**\n\n \n\nWe are a “foreign\nprivate issuer”, as such term is defined in Rule 405 under the Securities Act, and are not subject to the same requirements\nthat are imposed upon U.S. domestic issuers by the SEC. Under the Exchange Act, we are subject to reporting obligations that, in certain\nrespects, are less detailed and less frequent than those of U.S. domestic reporting companies. As a result, we do not file the same reports\nthat a U.S. domestic issuer files with the SEC, although we are required to file with or furnish to the SEC the continuous disclosure\ndocuments that we are required to file in Canada under Canadian securities laws, if applicable. In addition, our officers, directors,\nand principal shareholders are exempt from the reporting and “short swing” profit recovery provisions of Section 16\nof the Exchange Act. Therefore, our shareholders may not know on as timely a basis when our officers, directors and principal shareholders\npurchase or sell shares.\n\n \n\n17\n\n \n\n \n\nAs a foreign private issuer,\nwe are exempt from the rules and regulations under the Exchange Act related to the furnishing and content of proxy statements. We\nare also exempt from Regulation FD, which prohibits issuers from making selective disclosures of material non-public information.\nWhile we comply with the corresponding requirements relating to proxy statements and disclosure of material non-public information under\nCanadian securities laws, if and when applicable, these requirements differ from those under the Exchange Act and Regulation FD\nand shareholders should not expect to receive the same information at the same time as such information is provided by U.S. domestic\ncompanies. In addition, we have more time than U.S. domestic companies after the end of each fiscal year to file our annual report\nwith the SEC and are not required under the Exchange Act to file quarterly reports with the SEC.\n\n \n\nIn addition, as a foreign\nprivate issuer, we have the option to follow certain Canadian corporate governance practices instead of those otherwise required under\nthe applicable rules of Nasdaq for domestic U.S. issuers, except to the extent that such practices would be contrary to U.S. securities\nlaws, and provided that we disclose the requirements we are not following and describe the Canadian practices we follow instead. We may\nin the future elect to follow home country practices in Canada instead of those otherwise required under the applicable rules of Nasdaq\nfor domestic U.S. issuers with regard to certain corporate governance matters.\n\n \n\nAs a result, our shareholders\nmay not have the same protections afforded to shareholders of U.S. domestic companies that are subject to all corporate governance requirements.\n\n \n\n**We may lose our status as a foreign private\nissuer in the United States, which would result in increased costs related to regulatory compliance under United States securities laws.**\n\n \n\nWe will cease to qualify\nas a “foreign private issuer,” as defined in Rule 405 under the Securities Act and Rule 3b-4 under the Exchange\nAct, if, as of the last business day of our second fiscal quarter, more than 50% of our outstanding Common Shares are directly or indirectly\nowned by residents of the United States and any of the following three circumstances applies: (i) the majority of our executive\nofficers or directors are U.S. citizens or residents; (ii) more than 50% of our assets are located in the United States; or (iii) our\nbusiness is administered principally in the United States. If we determine that we fail to qualify as a foreign private issuer, we will\ncease to be eligible to avail ourselves of the forms and rules designated for foreign private issuers beginning on the first day\nof the fiscal year following such determination. Among other things, this will result in loss of the exemption from registration\nunder the Exchange Act provided by Rule 12g3-2(b) thereunder, and, if we are required to register our Common Shares under section\n12(g) of the Exchange Act, we will have to do so as a domestic issuer. Further, any securities that we issue in unregistered or\nunqualified offerings both within and outside the United States will be “restricted securities” (as defined in Rule 144(a)(3) under\nthe Securities Act) and will continue to be subject to United States resale restrictions notwithstanding their resale in “offshore\ntransactions” pursuant to Regulation S under the Securities Act. As a practical matter, this will likely require us to register\nmore offerings of our securities under the Securities Act on either a primary offering or resale basis, even if they take place entirely\noutside the United States. The resulting legal and administrative costs of complying with the resulting regulatory requirements are anticipated\nto be substantial, and to subject us to additional exposure to liability for which we may not be able to obtain insurance coverage on\nfavorable terms, or at all.\n\n \n\n**If our share price fluctuates, you could\nlose a significant part of your investment.**\n\n \n\nThe market price of our\nCommon Shares could be subject to wide fluctuations in response to, among other things, the risk factors described in this section of\nthe Annual Report on Form 20-F, and other factors beyond our control, such as fluctuations in the valuation of companies perceived\nby investors to be comparable to us.\n\n \n\n18\n\n \n\n \n\nFurthermore, the stock markets\nhave experienced price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many\ncompanies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad\nmarket and industry fluctuations, as well as general economic, political, and market conditions, such as recessions, interest rate changes\nor international currency fluctuations, may negatively affect the market price of our Common Shares. In the past, many companies that\nhave experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the\ntarget of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert our management’s\nattention from other business concerns, which could seriously harm our business.\n\n \n\nThe public offering price\nof our Common Shares has been determined by negotiations between us and the underwriter based upon many factors and may not be indicative\nof prices that will prevail following the closing of an offering. Volatility in the market price of our Common Shares may prevent investors\nfrom being able to sell their shares at or above the public offering price. As a result, you may suffer a loss on your investment.\n\n \n\n**Investors may be unable to enforce judgments\nagainst certain of our directors and officers because they reside outside of the United States.**\n\n \n\nWe are incorporated under\nthe laws of the Province of Ontario, Canada and most of our assets are located outside of the United States. Furthermore, most of our\ndirectors and officers reside outside of the United States in Canada. As a result, investors may not be able to effect service of process\nwithin the United States upon such of our directors or officers or enforce against them in U.S. courts, judgments predicated on U.S.\nsecurities laws. Likewise, it may also be difficult for an investor to enforce in U.S. courts, judgments obtained against these persons\nin courts located in jurisdictions outside of the United States.\n\n \n\nAs a result of the above,\npublic shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of our\nBoard of Directors or controlling shareholders than they would as public shareholders of a U.S. based company.\n\n** **\n\n**We do not intend to pay dividends on our\nCommon Shares in the near future, and, consequently, your ability to achieve a return on your investment will depend on appreciation\nin the price of our Common Shares.**\n\n \n\nWe have never declared or\npaid any cash dividend on our Common Shares and do not currently intend to do so in the foreseeable future. We currently anticipate that\nwe will retain future earnings for the development, operation and expansion of our business and do not anticipate declaring or paying\nany cash dividends in the foreseeable future. Therefore, the success of an investment in our Common Shares will depend upon any future\nappreciation in their value. There is no guarantee that our Common Shares will appreciate in value or even maintain the price at which\nyou purchased them.\n\n** **\n\n**If securities or industry analysts do not\npublish research or publish inaccurate or unfavorable research about us, our share price and trading volume could decline.**\n\n \n\nThe trading market for our\nCommon Shares will depend, in part, on the research and reports that securities or industry analysts publish about us or our operations.\nWe do not have any control over these analysts and their research and reports. Securities and industry analysts do not currently, and\nmay never, publish research on our business. If no security or industry analysts commence coverage on us, the trading price for our Common\nShares would likely be negatively affected. In the event securities or industry analysts initiate coverage, if one or more of the analysts\nwho cover us downgrade our shares or publish inaccurate or unfavorable research about our business, our share price would likely decline.\nIn addition, if our operating results fail to meet the forecast of analysts, our share price would likely decline. If one or more of\nthese analysts cease coverage of us or fail to publish reports on us regularly, demand for our shares could decrease, which might cause\nour share price and trading volume to decline.\n\n \n\n19\n\n \n\n \n\n**Specific Risks Related to Our First Towers’\nBusiness**\n\n** **\n\n**First Towers has a limited operating history\nand operates in an innovative and steady sector with long-term commitments. Its future earnings, if any, and cash flows are subject to\nthese long-term commitments, resulting in uncertainty about the prospects of Akanda post-Transaction.**\n\n \n\nFirst Towers was founded\nin February 2017 and is focused on tower development and operating its 700+km fiber optic network in the attractive wireless market of\nMexico, with an intention to expand to other Latin American countries. Consequently, First Towers is subject to all the risks and uncertainties\ninherent in a new business and in connection with the development and sale of new services. In addition, the fiber optic/telecommunications\nindustry is an innovative sector. Accordingly, investors should consider First Towers’ prospects in light of the costs, uncertainties,\ndelays, and difficulties frequently encountered by companies in this early stage of development and operating in a changing and evolving\nsector. Investors should carefully consider the risks and uncertainties that a company, such as First Towers, with a limited operating\nhistory will face. In particular, investors should consider that First Towers cannot provide assurance that it will be able to:\n\n ** **\n\n \n●\nsuccessfully implement\nor execute First Towers’ current business plan;\n\n \n\n \n●\nmaintain First Towers’\nmanagement team;\n\n \n\n \n●\nraise sufficient funds\nin the capital markets to effectuate First Towers’ business plan;\n\n \n\n \n●\nattract, enter or maintain\ncontracts with, and retain clients; and/or\n\n \n\n \n●\ncompete effectively in\nthe extremely competitive environment in which First Towers operates.\n\n \n\nIf First Towers cannot successfully\naccomplish any of the foregoing objectives, First Towers’ business may not succeed.\n\n \n\n**First Towers’ insurance may not adequately\ncover its operating risk and Akanda post-Transaction may have difficulty obtaining insurance at economically viable rates.**\n\n \n\nFirst Towers has insurance\nto protect its assets, operations and employees. While First Towers believes its insurance coverage addresses all material risks to which\nFirst Towers is exposed and is adequate and customary in its current state of operations, such insurance is subject to coverage limits\nand exclusions and may not be available for all the risks and hazards to which First Towers is exposed. In addition, no assurance can\nbe given that such insurance will be adequate to cover its liabilities or will be generally available in the future or, if available,\nthat premiums will be commercially justifiable. If First Towers were to incur substantial liability and such damages were not covered\nby insurance or were in excess of policy limits, or if First Towers were to incur such liability at a time when First Towers is not able\nto obtain liability insurance, its business, results of operations and financial condition could be materially adversely affected. First\nTowers’ limited operating history may make it difficult to obtain insurance policies at competitive rates. Insurance that is otherwise\nreadily available, such as workers’ compensation, general liability, title insurance and directors’ and officers’ insurance,\nis more difficult for First Towers to find and more expensive because of its involvement in emerging areas. There are no guarantees that\nAkanda post-Transaction, particularly with Akanda’s continued business in hemp and cannabis cultivation, will be able to find insurance\ncoverage at otherwise competitive, or even economically viable terms.\n\n \n\n20\n\n \n\n ** **\n\n**First Towers’ growth and financial\nhealth are subject to substantial uncertainty due to extreme market volatility in securities prices, reduced liquidity and credit availability,\nrating downgrades of certain investments and declining values.**\n\n** **\n\nThe financial markets in\nthe United States have experienced substantial uncertainty during recent years, particularly following the COVID-19 outbreak and potential\nonset of reciprocal U.S. tariffs. This uncertainty has included, among other things, extreme volatility in securities prices, reduced\nliquidity and credit availability, rating downgrades of certain investments and declining values with respect to others. If capital and\ncredit markets continue to experience uncertainty and available funds remain limited, Akanda post-Transaction may not be able to obtain\ndebt or equity financing or to refinance its existing indebtedness on favorable terms or at all, which could affect its strategic operations,\nfinancial performance and force modifications to its operations. These conditions currently have not precluded Akanda post-Transaction\nfrom accessing credit markets or financing its operations, but there can be no assurance that financial markets and confidence in major\neconomies will not deteriorate. In addition, Akanda post-Transaction may be vulnerable to changes in market preferences or other market\nchanges, such as general economic conditions, recession and fears of recession, interest rates, tax rates, policies, and inflation. The\nU.S. is currently experiencing unusually high rates of inflation, and Akanda post-Transaction may experience a compression in its margins\nas a result. The U.S. and global economies have in the past, and will in the future, experience recessionary periods and periods of economic\ninstability. During such periods, the existing and potential customers of Akanda post-Transaction may choose not to expend the amounts\nthat Akanda post-Transaction anticipates based on its expectations with respect to the addressable market for the services offered. There\ncould also be a number of other effects from adverse general business and economic conditions on the business of Akanda post-Transaction,\nincluding insolvency of any of third-party suppliers or contractors, decreased market confidence, decreased interest in communications\nsolutions, decreased discretionary spending and reduced customer demand for the services offered, any of which could have a Material\nAdverse Effect on the business, financial condition and results of operations.\n\n** **\n\n**The current and future state of the domestic\nand global economy, including increased costs and inflation may adversely affect the operations and anticipated revenue of Akanda post-Transaction.**\n\n** **\n\nThe business of Akanda post-Transaction\nmay be adversely affected by changes in domestic and international economic conditions, including inflation, which can adversely affect\nAkanda post-Transaction due to the increasing costs of critical materials, equipment, labor, and other services. In addition, inflation\nis often accompanied by higher interest rates. Continued inflationary pressures could impact the profitability of Akanda post-Transaction.\nInflation may also affect the ability to enter into future traditional debt financing, as high inflation may result in an increase in\ncosts related to any future financing.\n\n \n\nThe U.S. Congress, the Canadian\nHouse of Commons, the General Congress of the United Mexican States, the Organization for Economic Co-operation and Development, and\nother government agencies in jurisdictions where Akanda and its affiliates do business have been focused on issues related to the taxation\nof multinational corporations. Specific attention has been paid to “base erosion and profit shifting,” where payments are\nmade between affiliates from a jurisdiction with high tax rates to a jurisdiction with lower tax rates. As a result, the tax laws in\nthe United States, Canada and Mexico and other countries in which Akanda and its affiliates do business could change on a prospective\nor retroactive basis, and any such change could adversely affect the Akanda post-Transaction.\n\n \n\n**A significant failure or deterioration\nin the First Towers’ dark fiber optic network and its control systems could have a Material Adverse Effect on its business and\noperating results.**\n\n \n\nThe quality and integrity\nof First Towers’ dark fiber optic networks are critical to the success of our business and operations. As such, it is imperative\nthat First Towers (and First Towers’ service providers’) network and its control systems operate effectively and successfully.\nThe network and its control systems can be negatively impacted by the design of the control systems, the quality training programs and\nadherence by employees to control guidelines. Although First Towers strives to ensure that all of its service providers have implemented\nand adhere to high-quality control systems, any significant failure or deterioration of such systems could have a Material Adverse Effect\non its infrastructure, business, and operating results.\n\n \n\n21\n\n \n\n \n\n**First Towers may experience breaches of\nsecurity at its facilities or on its networks or losses as a result of the theft of its products.**\n\n \n\nA security breach or any\ntheft at one of First Towers’ facilities or to its networks could result in a significant loss of available service/coverage, expose\nFirst Towers to additional liability under applicable regulations and to potentially costly litigation or increase expenses relating\nto the resolution and future prevention of these thefts or breaches and may deter potential customers from choosing First Towers’\nservices, any of which could have an adverse effect on its business, financial condition and results of operations.\n\n \n\n**First Towers’ networks and services\nmay be affected from time to time by design and manufacturing defects that could cause a Material Adverse Effect on First Towers’\nbusiness and result in harm to First Towers’ reputation.**\n\n \n\nFirst Towers offers telecommunication\ninfrastructure and provides networks and service connections that can be affected by design and manufacturing defects. Sophisticated\noperating system software and applications, as well as hardware on its networks can often have issues that can unexpectedly interfere\nwith the intended operation of hardware or software products and give rise to connectivity or service connection issues. Defects can\nalso exist in components and products First Towers purchases from third parties. Component defects could make First Towers’ infrastructure\nunsafe and create a risk of environmental or property damage and personal injury. As a result, First Towers’ infrastructure may\nfrom time to time not perform as anticipated and may not meet customer expectations. There can be no assurance First Towers will be able\nto detect and fix all issues and defects in its available infrastructure and it cannot guarantee that one tenant’s defect or malfunction\nwill not affect other tenants utilizing the infrastructure. Failure to conduct timely repairs can result in widespread technical and\nperformance issues affecting First Towers’ infrastructure and the network providers utilizing it. In addition, First Towers can\nbe exposed to product liability claims, recalls, product replacements or modifications, write-offs of inventory, property, plant and\nequipment, and/or intangible assets, and significant warranty and other expenses, including litigation costs and regulatory fines. Quality\nproblems can also adversely affect the experience for users of First Towers’ infrastructure, and result in harm to First Towers’\nreputation, loss of competitive advantage, poor market acceptance, reduced demand for products and services, delay in new product and\nservice introductions and lost sales.\n\n \n\n**First Towers will need to raise substantial\nadditional funds in the future, which funds may not be available or, if available, may not be available on acceptable terms.**\n\n \n\nChanging circumstances may\ncause First Towers to consume capital more rapidly than anticipated. The continued growth of First Towers’ business, including\ndevelopment, regulatory approval and leasing space, will significantly increase First Towers’ expenses going forward, regardless\nof First Towers’ ability to generate revenue. As a result, First Towers will be required to seek substantial additional funds to\ncontinue its business. First Towers’ future capital requirements will depend on many factors, including:\n\n \n\n \n●\nthe cost of building towers\nand installing fiber;\n\n \n\n \n●\nobtaining and maintaining\nany regulatory clearance or approvals;\n\n \n\n \n●\nmaintenance of current\ninfrastructure;\n\n \n\n \n●\nany change in development\npriorities;\n\n \n\n \n●\nthe revenue generated by\nuse of towers and fiber;\n\n \n\n \n●\nthe cost of ongoing compliance\nwith regulatory requirements;\n\n \n\n22\n\n \n\n \n\n \n●\nexpenses incurred in connection\nwith potential litigation or governmental investigations;\n\n \n\n \n●\nanticipated or unanticipated\ncapital expenditures; and\n\n \n\n \n●\nunanticipated general and\nadministrative expenses.\n\n \n\nFirst Towers may need to\nraise additional funds in the future to support its operations. If First Towers is required to secure additional financing, such additional\nfundraising efforts may divert First Towers’ management from their day-to-day activities. If First Towers is unable to raise additional\ncapital in sufficient amounts or on terms acceptable to First Towers, First Towers may be prevented from carrying out its business plan.\nThis would have a Material Adverse Effect on First Towers’ business, financial condition and results of operations.\n\n** **\n\n**First Towers may be subject to risks associated\nwith climate change, including the potential increased impact of severe weather events on First Towers’ operations and infrastructure.**\n\n \n\nThe potential physical effects\nof climate change, such as increased frequency and severity of storms, floods, fires, fog, mist, hail, freezing conditions, sea-level\nrise and other climate-related events, could affect First Towers’ operations, infrastructure and financial results. First Towers\ncould incur significant costs to improve the climate resiliency of its infrastructure and otherwise prepare for, respond to, and mitigate\nsuch physical effects of climate change. First Towers is not able to accurately predict the materiality of any potential losses or costs\nassociated with the physical effects of climate change.\n\n** **\n\n**First Towers and its third-party suppliers\nmust comply with environmental, health and safety laws and regulations, which can be expensive and restrict how First Towers does, or\ninterrupt First Towers’ business.**\n\n \n\nFirst Towers’ and\nits third-party manufacturers’ and suppliers’ activities may involve the generation, use, storage and disposal of hazardous\nmaterials. First Towers may work with materials, compounds and samples that could be hazardous to human health and safety and the environment.\nFirst Towers’ operations may also produce waste products. Accordingly, First Towers and its third-party manufacturers and suppliers\nare subject to federal, state, local and foreign environmental, health and safety laws and regulations, and permitting and licensing\nrequirements. If First Towers does not comply with applicable laws and regulations, and permitting and licensing requirements, First\nTowers may be subject to fines, penalties, a suspension of our business or other sanctions.\n\n** **\n\n**First Towers’ networks, service coverage,\nand telecommunication infrastructure may be subject to regulation, or local municipal approvals, which may limit demand for First Towers’\ninfrastructure in particular locations and harm our business and operating results.**\n\n \n\nOperating a telecommunications\ninfrastructure company in Mexico presents several risk factors, particularly regarding regulatory challenges. The Mexican government\nhas implemented reforms aimed at increasing competition and digital inclusion, which can lead to stricter compliance requirements and\npotential market shifts. First Towers’ infrastructure may be subject to regulatory approval, particularly by local governments,\nwhich may impact First Towers’ ability to site infrastructure in particular advantageous locations. Additionally, geopolitical\nconcerns, including the presence of foreign technology providers, could lead to policy changes that impact infrastructure investments\nand customer commitments, which may cause outages if new suppliers need to be obtained or legacy equipment needs to be updated. Such\noutages may limit demand for First Towers’ services and consequently materially harm its business and results of operations. Depending\non the height of certain telecommunication infrastructure, First Towers may also need to cooperate with the Federal Aviation Administration\n(FAA) and Agencia Federal de Aviación Civil (AFAC) for necessary safety standards.\n\n \n\n23\n\n \n\n \n\n**Infrastructure development and maintenance\nis a long, expensive and uncertain process.**\n\n** **\n\nThe infrastructure development\nand maintenance process is a costly, complex and time-consuming process, and investments in infrastructure development and maintenance\noften involve a long wait until a return, if any, can be achieved on such an investment. First Towers might face difficulties or delays\nin the infrastructure development and maintenance process that will result in First Towers’ inability to timely offer services\nthat satisfy the market, which might allow competing services to emerge during the developing new infrastructure and maintaining existing\ninfrastructure development. First Towers anticipates making significant investments in construction and development to expand its services\nand coverage, but such investments are inherently speculative and require substantial capital expenditures. Any unforeseen technical\nobstacles and challenges that First Towers encounters in the research and development, permitting, construction, and/or associated processes\ncould result in delays in or the abandonment of a particular service or coverage area, may substantially increase development costs,\nand may negatively affect its results of operations.\n\n** **\n\n**Rapid technological changes may adversely\naffect the market acceptance of First Towers’ networks and services and could adversely affect its business, financial condition\nand results of operations.**\n\n** **\n\nThe telecommunications market\nis subject to technological changes, introduction of new products and services, change in customer demands and evolving industry standards.\nFirst Towers’ future success will depend upon its ability to keep pace with technological developments and to timely address the\nincreasingly sophisticated needs of its customers by supporting existing and new technologies and by developing and introducing enhancements\nto its current products and new products. First Towers may not be successful in developing and marketing its infrastructure in response\nto technological change, evolving industry standards or customer requirements, particularly satellite-based internet/communication infrastructure.\nIn addition, First Towers may experience difficulties internally or in conjunction with key vendors and partners that could delay or\nprevent the successful development, introduction and sale of its infrastructure may not adequately meet the requirements of the market\nand may not achieve any significant degree of market acceptance. If release dates of First Towers’ new products or infrastructure\nare delayed or, if when released, they fail to achieve market acceptance, First Towers’ business, operating results and financial\ncondition may be adversely affected.\n\n** **\n\n**First Towers may face competition from\nother telecommunications companies, many of which have substantially greater resources.**\n\n \n\nThe telecommunications industry\nis evolving rapidly and is highly competitive. There are many telecommunication companies, both with and without their own infrastructure,\nwhich have substantially greater resources, expertise and capital. First Towers’ failure to compete with such industry participants\ncould have a material adverse effect on First Towers’ ability to grow its business and consequently its results of operations and\nfinancial condition.\n\n \n\n**If First Towers’ services do not\nexperience significant growth, if First Towers cannot create and expand its customer base, or if its services do not achieve broad acceptance,\nthen First Towers may not be able to achieve its anticipated level of growth.**\n\n \n\nWe cannot accurately predict\nthe future growth rates or sizes of the markets for First Towers’ services. Demand for First Towers’ services may not increase,\nor may decrease, either generally or in specific markets, for particular types of services or during particular time periods. The expansion\nof the telecommunication market in general, and the market for First Towers’ services in particular, depends on a number of factors,\nincluding the following:\n\n \n\n \n●\ncustomer satisfaction with\ntelecommunication provider;\n\n \n\n \n●\ncustomer satisfaction with\nFirst Towers’ specific services;\n\n \n\n \n●\nFirst Towers’ ability\nto technologically reduce maintenance costs;\n\n \n\n \n●\nthe cost, performance and\nreliability of First Towers’ services and services offered by First Towers’ competitors;\n\n \n\n24\n\n \n\n \n\n \n●\ncustomer perceptions regarding\nthe effectiveness and value of First Towers’ network and use of physical telecommunication infrastructure;\n\n \n\n \n●\nobtaining timely regulatory\napprovals, including, access to airspace, right of ways, and the wireless spectrum; and\n\n \n\n \n●\nmarketing efforts and publicity\nregarding First Towers’ services.\n\n \n\nIf First Towers’ services\nspecifically do not gain wide market acceptance, then First Towers may not be able to achieve its anticipated level of growth and our\nrevenue and results of operations will decline.\n\n \n\n**If First Towers’ long-term contracts\nare not maintained, First Towers may not earn enough revenue to become profitable.**\n\n** **\n\nFirst Towers relies on long-term\ncontracts to build its tower infrastructure and for the lease of its fiber network. Economic downturns, changing consumer preferences,\nor unexpected disruptions may make these commitments difficult to uphold or less profitable overtime. Additionally, failure to adapt\nto new industry trends or renegotiate contracts effectively could result in declining revenue, reputational damage, or financial strain.\nFirst Towers inability to be flexible in agreements, continuously assess market dynamics to mitigate risks, or adapt to consumer preferences\ncould result in the loss of long-term contracts underpinning its revenue generation.\n\n \n\n**First Towers may engage in transactions\nwith businesses that may be affiliated with our officers, directors or significant stockholders, and which may involve actual or potential\nconflicts of interest.**\n\n** **\n\nFirst Towers may decide\nto make investments in one or more businesses affiliated with its officers, directors or significant stockholders. Although First Towers\nwill not specifically focus on, or target, any particular transaction with any affiliates or affiliated entities, First Towers would\npursue such a transaction if First Towers determined that such an affiliated investment was attractive from a risk-adjusted return perspective,\nand such transaction were approved by a majority of Combined Corporation’s independent and disinterested directors. Any such activity\nwould involve actual or potential conflicts of interest. Although First Towers is confident that it can navigate these conflicts consistent\nwith best practices and applicable law, the existence or appearance of such conflicts of interest could make our securities less attractive\nand thereby reduce their trading prices.\n\n** **\n\n**Risks\nRelated to First Towers’ Business and Operations - Regulations and Compliance**\n\n** **\n\n**Operating a telecommunications infrastructure\nbusiness requires significant resources.**\n\n** **\n\nFirst Towers operates a\ntelecommunications infrastructure business. As a result, First Towers expects a significant amount of its management’s time and\nexternal resources to be used to comply with the laws, regulations and guidelines that impact First Towers’ business, and changes\nthereto, and such compliance may place a significant burden on First Towers’ management and other resources. Additionally, First\nTowers may be subject to a variety of local laws, regulations and guidelines in each of the jurisdictions in which First Towers operates,\nwhich may differ among these various jurisdictions. Complying with multiple regulatory regimes will require additional resources and\nmay impair our ability to expand into certain jurisdictions.\n\n** **\n\n25\n\n \n\n \n\n**The growth of First Towers’ business\ncontinues to be subject to new and changing federal, state, and local laws and regulations.**\n\n** **\n\nChanges in applicable federal,\nstate, and local regulations, including zoning restrictions, environmental requirements, FAA and AFAC compliance, security requirements,\nor permitting requirements and fees, could restrict the products and services First Towers may offer or impose additional compliance\ncosts on First Towers. Violations of applicable laws, or allegations of such violations, could disrupt First Towers’ business and\nresult in a Material Adverse Effect on First Towers’ operations. First Towers cannot predict the nature of any future laws, regulations,\ninterpretations or applications, including local, state or federal, and it is possible that regulations may be enacted in the future\nthat will be materially adverse to First Towers’ business or which would have materially significant costs of compliance which\ncould negatively impact First Towers’ business.\n\n** **\n\n**First Towers is subject to Canadian Privacy\nand Data Security Laws, which impose a range of obligations on First Towers. Failure to comply with PIPEDA and other provincial privacy\nlegislation could expose First Towers to significant liability and reputational harm.**\n\n** **\n\nFirst Towers is subject\nto Canadian federal and, where applicable, provincial privacy legislation, including the Personal Information Protection and Electronic\nDocuments Act (“PIPEDA”) and substantially similar provincial laws in British Columbia, which govern the collection, use,\nand disclosure of personal information in the course of commercial activities and impose a range of obligations on First Towers. Failure\nto comply with PIPEDA and other provincial privacy legislation could expose First Towers to significant liability and reputational harm.\n\n  \n\nIncreasingly, companies\nare subject to a wide variety of attacks on their networks and information technology infrastructure on an ongoing basis. Traditional\ncomputer “hackers,” malicious code (such as viruses and worms), phishing attempts, employee theft or misuse, denial of service\nattacks, ransomware attacks and sophisticated nation-state and nation-state supported actors engage in intrusions and attacks that create\nrisks for our (and our suppliers’) internal networks, vehicles, infrastructure, and cloud deployed products and the information\nthey store and process. Although First Towers has implemented security measures to prevent such attacks, its networks and systems may\nbe breached due to the actions of outside parties, employee error, malfeasance, a combination of these, or otherwise, and as a result,\nan unauthorized party may obtain access to our systems, networks, or data.\n\n \n\nFirst Towers may face difficulties\nor delays in identifying or otherwise responding to any attacks or actual or potential security breaches or threats. A breach in our\ndata security could create system disruptions or slowdowns and provide malicious parties with access to information stored on our networks,\nresulting in data being publicly disclosed, altered, lost, or stolen, which could subject us to liability and adversely impact our financial\ncondition. Further, any breach in our data security could allow malicious parties to access sensitive systems, such as our product lines\nand the vehicles themselves. Such access could adversely impact the safety of our employees and customers.\n\n \n\nIn addition, First Towers\nmay incur significant financial and operational costs to investigate, remediate and implement additional tools, devices and systems designed\nto prevent actual or perceived security breaches and other security incidents, as well as costs to comply with any notification obligations\nresulting from any security incidents. Any of these negative outcomes could adversely impact the market perception of First Towers’\nproducts and customer and investor confidence in our company, and would materially and adversely affect business, prospects, financial\ncondition, results of operations, and cash flows.\n\n \n\n26\n\n \n\n \n\n**Risks Related to First Towers’ Business\nand Operations - Intellectual Property**\n\n** **\n\n**First Towers may be subject to risks related\nto information technology systems, including cyber-security risks; successful cyber-attacks or technological malfunctions can result\nin, among other things, financial losses, the inability to process transactions, the unauthorized release of confidential information\nand reputational risk, all of which would negatively impact First Towers’ business, financial condition or results of operations.**\n\n** **\n\nFirst Towers’ use\nof technology is critical to its continued operations. First Towers may be susceptible to operational, financial and information security\nrisks resulting from cyber-attacks or technological malfunctions. Successful cyber-attacks or technological malfunctions affecting First\nTowers or its service providers can result in, among other things, financial losses, the inability to process transactions, the unauthorized\nrelease of confidential or proprietary information and reputational risk. As cyber-security threats continue to evolve, First Towers\nmay be required to use additional resources to continue to modify or enhance protective measures or to investigate security vulnerabilities,\nwhich could have a Material Adverse Effect on First Towers’ business, financial condition or results of operations.\n\n** **\n\n**Maintaining the integrity of First Towers’\ncomputer systems and protecting confidential information and personal identifying information may become increasingly costly, as cyber-security\nincidents could disrupt business operations, result in the loss of critical and confidential information, and adversely impact First\nTowers’ reputation and results of operations.**\n\n** **\n\nGlobal cyber-security threats\nand incidents can range from uncoordinated individual attempts that gain unauthorized access to information technology systems, both\ninternally and externally, to sophisticated and targeted measures, known as advanced persistent threats, directed at First Towers and\nits affiliated agents. In the ordinary course of First Towers’ business, First Towers intends to collect and store sensitive data,\nincluding its proprietary business information and IP, and personally identifiable information of First Towers’ customers. Additionally,\nFirst Towers may rely on third-party providers, including cloud storage solution providers. The secure processing, maintenance and transmission\nof this information are critical to First Towers’ operations and with respect to information collected and stored by First Towers’\nthird-party service providers, First Towers may be reliant upon their security procedures. First Towers’ systems and the confidential\ninformation on them may also be compromised by employee misconduct or employee error. First Towers and third-party service providers\nmay experience these types of internal and external threats and incidents, which can result in the misappropriation and unavailability\nof critical data and confidential or proprietary information (First Towers’ own and that of third parties, including personally\nidentifiable information) and the disruption of business operations. Depending on their nature and scope, these incidents could potentially\nalso result in the destruction or corruption of such data and information. The potential consequences of a material cyber-security incident\ninclude reputational damage, litigation with third parties, diminution in the value of the services First Towers provides to our customers,\nand increased cyber-security protection and remediation costs, which in turn could adversely affect First Towers’ competitiveness\nand results of operations. Developments in the laws and regulations governing the handling and transmission of personal identifying information\nin the United States may require First Towers to devote more resources to protecting such information, which could in turn adversely\naffect First Towers’ results of operations and financial condition.\n\n** **\n\n**Losses or unauthorized access to or releases\nof confidential information, including personal information, could subject First Towers to significant reputational, financial, legal\nand operational consequences.**\n\n** **\n\nFirst Towers intends to\nuse and store confidential information, including personal information, with respect to First Towers’ customers and employees.\nFirst Towers intends to devote significant resources to network and data security, including through the use of encryption and other\nsecurity measures intended to protect its systems and data, but these measures cannot provide absolute security, and losses or unauthorized\naccess to or releases of confidential information occur and could materially adversely affect First Towers’ business, reputation,\nresults of operations and financial condition. First Towers’ business also intends to share confidential information with suppliers\nand other third parties. First Towers may rely on global suppliers that are also exposed to ransomware and other malicious attacks that\ncan disrupt business operations. Although First Towers intends to take steps to secure confidential information that is provided to or\naccessible by third parties working on First Towers’ behalf, such measures may not always be effective and losses or unauthorized\naccess to or releases of confidential information occur. Such incidents and other malicious attacks could materially adversely affect\nFirst Towers’ business, reputation, results of operations and financial condition.\n\n \n\n27\n\n \n\n \n\n**Any material disruption in our information\nsystems could adversely affect First Towers’ business.**\n\n** **\n\nFirst Towers may rely on\ninformation technology networks and systems to operate and manage its business. First Towers’ information technology networks and\nsystems will process, transmit and store personal and financial information, proprietary information of First Towers’ business,\nand also allow First Towers to coordinate its business across its operation bases, and allow First Towers to communicate with its employees\nand externally with customers, suppliers, partners, and other third parties. While First Towers believes it takes reasonable steps to\nsecure these information technology networks and systems, and the data processed, transmitted, and stored thereon, such networks, systems,\nand data may be susceptible to cyberattacks, viruses, malware, or other unauthorized access or damage (including by environmental, malicious,\nor negligent acts), which could result in unauthorized access to, or the release and public exposure of, First Towers’ proprietary\ninformation. Any of the foregoing could cause substantial harm to First Towers’ business, require First Towers to make notifications\nto governmental authorities, or the media, and could result in litigation, investigations or inquiries by government authorities, or\nsubject First Towers to penalties, fines, and other losses relating to the investigation and remediation of such an attack or other unauthorized\naccess or damage to First Towers’ information technology systems and networks.\n\n** **\n\n**First Towers Risks Related to Third Parties**\n\n** **\n\n**First Towers may be subject to liability\narising from any fraudulent or illegal activity by its employees, contractors and consultants.**\n\n** **\n\nFirst Towers may be exposed\nto the risk that its employees, independent contractors and consultants may engage in fraudulent or other illegal activity. Misconduct\nby these parties could include intentional, reckless, or negligent conduct or disclosure of unauthorized activities to First Towers that\nviolate (i) government regulations, (ii) manufacturing standards, (iii) federal and state laws and regulations, or (iv) laws that require\nthe true, complete and accurate reporting of financial information or data. It is not always possible for First Towers to identify and\ndeter misconduct by its employees and other third parties, and the precautions taken by First Towers to detect and prevent this activity\nmay not be effective in controlling unknown or unmanaged risks or losses or in protecting First Towers from governmental investigations\nor other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. If any actions are brought against\nFirst Towers, including by former employees, independent contractors or consultants, and First Towers is not successful in defending\nitself or asserting its rights, those actions could have a significant impact on First Towers’ business, including the imposition\nof civil, criminal and administrative penalties, damages, monetary fines, contractual damages, reputational harm, diminished profits\nand future earnings, and the curtailment of First Towers’ operations, any of which would have an adverse effect on its business,\nfinancial condition and results from operations.\n\n**  **\n\n**First Towers’ dependence on suppliers\nand service partners for the parts and components in its development and maintenance of telecommunication infrastructure may result in\nshortages of key components necessary for First Towers’ products and services.**\n\n** **\n\nFirst Towers intends to\nrely on purchased parts and services which First Towers sources from several suppliers and service partners, some of whom are currently\nsingle source suppliers for these components and services. First Towers’ supply and service base may be located globally, and many\nof the components used in First Towers’ telecommunication infrastructure must be custom made for First Towers. This supply chain\nexposes First Towers to multiple potential sources of delivery failure or component shortages for First Towers’ services. First\nTowers has not historically maintained long-term agreements with its suppliers, though First Towers is taking steps to put in place certain\nlong-term agreements. While First Towers believes that it may be able to establish alternate supply relationships and can obtain replacement\ncomponents and services, First Towers may be unable to do so in the short term or at all at prices that are favorable to First Towers.\nFirst Towers may experience source disruptions in its supply and service chains which may cause delays in its production process for\nboth prototype and commercial production of telecommunication infrastructure components and parts. First Towers is also in some cases\nsubject to sole source suppliers for certain pieces of equipment for which First Towers relies on, or may be reliant on to achieve our\nnetwork coverage in particular areas. Changes in business conditions, wars, governmental changes, political intervention, and other factors\nbeyond First Towers’ control or which First Towers does not presently anticipate, could also affect First Towers’ suppliers’\nability to deliver components and services to First Towers on a timely basis. Furthermore, if First Towers experiences significantly\nincreased demand for infrastructure development or maintenance of its telecommunication infrastructure, or need to replace its existing\nsuppliers, there can be no assurance that additional supplies of component parts will be available when required on terms that are acceptable\nto First Towers, or at all, or that any supplier would allocate sufficient supplies to First Towers in order to meet First Towers’\nrequirements or fill our orders in a timely manner. The disruption in the supply of components from suppliers could lead to delays in\nFirst Towers’ offered services, which could materially adversely affect First Towers’ business prospects and operating results.\n\n \n\n28\n\n \n\n \n\n**If First Towers or First Towers’\nthird-party service providers experience a security breach, or if unauthorized parties otherwise obtain access to First Towers’\ncustomers’ data, First Towers’ reputation may be harmed, demand for services may be reduced, and First Towers may incur significant\nliabilities.**\n\n** **\n\nFirst Towers’ services\nmay involve the storage, processing and transmission of data, including certain confidential and sensitive information. Any security\nbreach, including those resulting from a cyber-security attack, phishing attack, or any unauthorized access, unauthorized usage, virus\nor similar breach or disruption could result in the loss or destruction of or unauthorized access to, or use, alteration, disclosure,\nor acquisition of, data, damage to First Towers’s reputation, litigation, regulatory investigations, or other liabilities. These\nattacks may come from individual hackers, criminal groups, and state-sponsored organizations. If First Towers’ security measures\nare breached as a result of third-party action, employee error, a defect or bug in First Towers’ products or those of its third-party\nservice providers, malfeasance or otherwise and, as a result, someone obtains unauthorized access to First Towers’ data, including\nFirst Towers’ confidential, sensitive, or other information about individuals, or any of these types of information is lost, destroyed,\nor used, altered, disclosed, or acquired without authorization, First Towers’ reputation may be damaged, First Towers’ business\nmay suffer, and First Towers could incur significant liability. Even the perception of inadequate security may damage First Towers’\nreputation and negatively impact its ability to win new customers and retain and receive timely payments from existing customers. Further,\nFirst Towers could be required to expend significant capital and other resources to address any data security incident or breach, which\nmay not be covered or fully covered by First Towers’ insurance and which may involve payments for investigations, forensic analyses,\nlegal advice, public relations advice, system repair or replacement, or other services. First Towers may engage third-party vendors and\nservice providers to store and otherwise process First Towers’ data, including confidential, sensitive, and other information about\nindividuals. First Towers’ vendors and service providers may also be the targets of cyberattacks, malicious software, phishing\nschemes, and fraud. First Towers’ ability to monitor its vendors and service providers’ data security is limited, and, in\nany event, third parties may be able to circumvent those security measures, resulting in the unauthorized access to, misuse, acquisition,\ndisclosure, loss, alteration, or destruction of our data, including confidential, sensitive, and other information about individuals.\nTechniques used to sabotage or obtain unauthorized access to systems or networks are constantly evolving and, in some instances, are\nnot identified until after they have been launched against a target. First Towers and its service providers may be unable to anticipate\nthese techniques, react in a timely manner, or implement adequate preventative and mitigating measures. If First Towers is unable to\nefficiently and effectively maintain and upgrade its system safeguards, First Towers may incur unexpected costs and its systems may become\nmore vulnerable to unauthorized access or disruption.\n\n**  **\n\n**For certain of the components and services\nincluded in First Towers’ products there may be a limited number of suppliers First Towers can rely upon and if First Towers is\nunable to obtain these components and services when needed, First Towers could experience delays in repairing or maintaining its telecommunication\ninfrastructure and providing services, and its financial results could be adversely affected.**\n\n** **\n\nFirst Towers intends to\nacquire most of the components for the repair and maintenance of its telecommunication infrastructure from suppliers and subcontractors.\nSuppliers of some of the components may require First Towers to place orders with significant lead-times to assure supply in accordance\nwith its manufacturing requirements. Delays in supply, or unavailability of services, may significantly hurt First Towers’ ability\nto fulfill our contractual obligations and may significantly hurt First Towers’ business and result of operations. In addition,\nFirst Towers may not be able to continue to obtain such components or services from these suppliers on satisfactory commercial terms.\nDisruptions of our offered services could ensue if First Towers was required to obtain components or services from alternative sources,\nwhich would have an adverse effect on First Towers’ business, results of operations and financial condition.\n\n \n\n29\n\n \n\n \n\n**First Towers may pursue strategic transactions\nin the future, which could be difficult to implement, disrupt First Towers’ business or change First Towers’ business profile\nsignificantly.**\n\n \n\nFirst Towers intends to\nconsider potential strategic transactions, which could involve acquisitions of businesses or assets, joint ventures or investments in\nbusinesses, products or technologies that expand, complement or otherwise relate to First Towers’ current or future business. Should\nFirst Towers’ relationships fail to materialize into significant agreements, or should First Towers fail to work efficiently with\nthese companies, First Towers may lose sales and marketing opportunities and First Towers’ business, results of operations and\nfinancial condition could be adversely affected. These activities, if successful, create risks such as, among others: (i) the need to\nintegrate and manage the businesses and products acquired with First Towers’ own business and products; (ii) additional demands\non First Towers’ resources, systems, procedures and controls; (iii) disruption of First Towers’ ongoing business; and (iv)\ndiversion of management’s attention from other business concerns. Moreover, these transactions could involve: (a) substantial investment\nof funds or financings by issuance of debt or equity securities; (b) substantial investment with respect to technology transfers and\noperational integration; and (c) the acquisition or disposition of product lines or businesses. Also, such activities could result in\none-time charges and expenses and have the potential to either dilute the interests of First Towers’ existing shareholders or result\nin the issuance of, or assumption of debt. Such acquisitions, investments, joint ventures or other business collaborations may involve\nsignificant commitments of financial and other resources. Any such activities may not be successful in generating revenue, income or\nother returns, and any resources First Towers committed to such activities will not be available to First Towers for other purposes.\nMoreover, if First Towers is unable to access the capital markets on acceptable terms or at all, First Towers may not be able to consummate\nacquisitions, or may have to do so on the basis of a less than optimal capital structure. First Towers’ inability to take advantage\nof growth opportunities or address risks associated with acquisitions or investments in businesses may negatively affect First Towers’\noperating results. Additionally, any impairment of goodwill or other intangible assets acquired in an acquisition or in an investment,\nor changes to earnings associated with any acquisition or investment activity, may materially reduce First Towers’ earnings. Future\nacquisitions or joint ventures may not result in their anticipated benefits, and First Towers may not be able to properly integrate acquired\nproducts, services, technologies or businesses with First Towers’ existing products and operations or successfully combine personnel\nand cultures. Failure to do so could deprive First Towers of the intended benefits of those acquisitions.\n\n** **\n\n**First Towers’ telecommunication infrastructure\nmay be at risk of unexpected technical failure due to the unavailability of third-party information and infrastructure services such\nas communications, data processing, computing power, SaaS, and other information and infrastructure services or technical issues with\nthird party dependent data and software platforms.**\n\n \n\nFirst Towers’ telecommunication\ninfrastructure may experience technical difficulties that prevent customers from collecting and processing data in near real-time or\na timely manner. The most common technical problem First Towers’ customers may experience is the unavailability of third-party\ncommunications, data processing, computing power, SaaS, and other information and infrastructure services which is necessary to process\nand collect data through First Towers’ offered services. While this may not affect the performance of First Towers’ telecommunication\ninfrastructure or the collection of the data, it could potentially prevent customers from being able to access their data, services,\nand analysis in near real-time or a timely manner.\n\n** **\n\n30\n\n \n\n \n\n**Miscellaneous Risks**\n\n \n\n**Future acquisitions and strategic investments\ncould be difficult to integrate, divert the attention of key management personnel, disrupt our business, dilute shareholder value, and\nharm our results of operations and financial condition.**\n\n \n\nWe consummated the Transaction\nwith First Towers to expand our business offerings and be less reliant on the cannabis market. We may further, in the future seek to\nacquire or invest in, other businesses, products, or technologies that we believe could complement our operations or expand our breadth,\nenhance our capabilities, or otherwise offer growth opportunities. While our growth strategy with respect to our planned cannabis operations\nmay include broadening our product offerings, implementing an aggressive marketing plan and employing product diversification, there\ncan be no assurance that our systems, procedures and controls will be adequate to support our operations as they expand. We cannot assure\nyou that our personnel, systems, procedures or controls will be adequate to support our operations in the future or that we will be able\nto successfully implement appropriate measures consistent with our growth strategy. As part of our planned growth and diversified product\nofferings, we may have to implement new operational and financial systems, procedures and controls to expand, train and manage our employee\nbase, and maintain close coordination among our staff. We cannot guarantee that we will be able to do so, or that if we are able to do\nso, we will be able to effectively integrate them into our existing staff and systems. Additionally, the integration of our acquisitions,\nincluding with First Towers, and pursuit of potential future acquisitions may divert the attention of management and cause us to incur\nvarious expenses in identifying, investigating, and pursuing suitable acquisitions, whether or not they are consummated. Any acquisition,\ninvestment or business relationship may result in unforeseen operating difficulties and expenditures. In addition, we have limited experience\nin acquiring other businesses. Specifically, we may not successfully evaluate or utilize the acquired products, assets or personnel,\nor accurately forecast the financial impact of an acquisition transaction, including accounting charges. Moreover, the anticipated benefits\nof any acquisition, investment, or business relationship may not be realized, including with respect to First Towers, or we may be exposed\nto unknown risks or liabilities associated with our acquisitions.\n\n \n\nWe may not be able to find\nand identify desirable acquisition targets or we may not be successful in entering into an agreement with any one target. Acquisitions\ncould also result in dilutive issuances of equity securities or the incurrence of debt, which could harm our results of operations. In\naddition, if an acquired business fails to meet our expectations, our business, results of operations, and financial condition may suffer.\nIn some cases, minority shareholders may exist in certain of our non-wholly-owned acquisitions (for businesses we do not purchase as\nan 100% owned subsidiary) and may retain minority shareholder rights which could make a future change of control or necessary corporate\napprovals for actions more difficult to achieve and/or more costly.\n\n \n\nWe may also make strategic\ninvestments in early-stage companies developing products or technologies that we believe could complement our business or expand our\nbreadth, enhance our technical capabilities, or otherwise offer growth opportunities. These investments may be in early-stage private\ncompanies for restricted stock. Such investments are generally illiquid and may never generate value. Further, the companies in which\nwe invest may not succeed, and our investments could lose their value.\n\n \n\n**We are dependent upon our management, and\nthe loss of any member of our management team could have a material adverse effect on our operations.**\n\n \n\nOur success is dependent\nupon the ability, expertise, judgment, discretion and good faith of our senior management and key employees, including, without limitation,\nKatie Field, our Interim Chief Executive Officer and Executive Director, Gurcharn Deol, our Chief Financial Officer, Chris Cooper, a\ndirector who also leads our First Towers subsidiary, and the other executives of First Towers. The loss of any member of our management\nteam or any of our key employees could have a material adverse effect on our business and results of operations. While employment agreements\nand incentive programs are customarily used as primary methods of retaining the services of key employees, these agreements and incentive\nprograms cannot assure the continued services of such employees. Any loss of the services of such individuals, or an inability to attract\nother suitably qualified persons when needed, could have a material adverse effect on our business, operating results or financial condition.\nWe do not currently maintain key-person insurance on the lives of any of our key employees or members of management. Competition for\nqualified technical, sales and marketing staff, as well as officers and directors can be intense, and no assurance can be provided that\nwe will be able to attract or retain such qualified individuals in the future, which may adversely affect our operations.\n\n** **\n\n31\n\n \n\n \n\n**Our directors and officers may have conflicts\nof interest in conducting their duties.**\n\n** **\n\nWe may be subject to various\npotential conflicts of interest because of the fact that some of our officers and directors may be engaged in the cannabis industry through\ntheir participation in corporations, partnership or joint ventures, which are potential competitors of our company. Situations may arise\nin connection with potential acquisitions in investments where the other interests of these directors and officers may conflict with\nthe interests of our company. Our directors and officers with conflicts of interest will be subject to the procedures set out in the\nrelated Canadian law and regulations.\n\n \n\n**Our executive officers are engaged in other\nbusiness activities and, accordingly, may not devote sufficient time to our business affairs, which may affect our ability to conduct\noperations.**\n\n \n\nOur executive officers and\ndirectors may devote time to their outside business interests, so long as such activities do not materially or adversely interfere with\ntheir duties to us. In some cases, our executive officers and directors may have fiduciary obligations associated with these business\ninterests that interfere with their ability to devote time to our business and affairs and that could adversely affect our operations.\nThese business interests could require significant time and attention of our executive officers and directors. For example, our Interim\nChief Executive Officer and Executive Director, Ms. Katie Field, is the Chief Executive Officer and Chairman of Halo among other ventures,\nand Chris Cooper, our director and head of our First Towers subsidiary, is affiliated with other ventures.\n\n \n\n**Adverse global economic, market and industry\nconditions and other geopolitical issues may impact our operations which could have a negative effect on our business results and financial\ncondition and liquidity.**\n\n \n\nOur performance may be affected\nby global economic market and industry conditions (including the current inflationary economic environment, rising interest rates and\ndisruptions related to the banking industry) as well as geopolitical issues and other conditions with global reach. In recent years,\nconcerns about the global economic outlook have adversely affected market and business conditions in general. Macroeconomic weakness\nand uncertainty make it more difficult for us to manage our operations and accurately forecast revenue, gross margin and operating expenses.\nFurther, recent bank failures and other adverse developments that affect financial institutions, transactional counterparties, or other\nthird parties, or concerns or rumors about these events, have led to market-wide liquidity problems. While we have no borrowings with\nor deposit exposure to these recently failed banks and has not experienced an adverse impact to our liquidity or to its business operations,\nfinancial conditions, geopolitical issues, such as the conflict over the Strait of Hormuz and renewed conflict between Iran and the United\nStates, the Russian invasion of Ukraine, armed conflict between Israel and groups based in surrounding regions, relations between the\nU.S. and China, tariff and trade policy changes, and increasing potential of conflict involving countries in Asia that are or may be\ncritical to our supply-chain operations, such as Taiwan and China, have resulted in increasing global tensions and create uncertainty\nfor global commerce. In addition, rising inflation has affected businesses across many industries, including our business industry, by\nincreasing the costs of labor, employee healthcare, components and freight and shipping, which may further constrain our customers’\nor prospective customers’ budgets. To the extent there is a sustained general economic downturn, and our platform and services\nare perceived by customers or potential customers as costly, or too difficult to deploy or migrate to, our revenue may be disproportionately\naffected by delays or reductions in spending. Sustained or worsening of global economic conditions and geopolitical issues may increase\nour cost of doing business, materially disrupt its supply chain operations, cause its customers to reduce or delay spending and intensify\npricing pressures. We cannot predict the timing, strength or duration of any economic slowdown, instability or recovery, generally or\nwithin any particular industry. If the economic conditions of the general economy or markets in which we operate worsen from present\nlevels, demand for our existing and planned products and services, and our business, financial condition and results of operations, could\nbe adversely affected.\n\n \n\n32\n\n \n\n \n\n**Disease outbreaks or public health emergencies\ncould adversely affect our future operations.**\n\n \n\nOur planned and existing\noperations could be significantly and adversely affected by the effects of a widespread global outbreak of a contagious disease and other\nunforeseen events and the related economic repercussions. We cannot accurately predict the effects global pandemics or other public health\nemergencies will have on our operations and the ability of others to meet their obligations with us, including uncertainties relating\nto the ultimate geographic spread of the disease, the severity of the disease, the duration of the outbreak, and the length of travel\nand quarantine restrictions imposed by governments of affected countries. The ultimate impact on us and our significant suppliers and\nprospective customers is unknown, but our operations and financial condition could suffer in the event of any of these types of unpredictable\nevents. Further, any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our business,\nresults of operations, financial condition and cash flows.** **\n\n \n\n**We may incur significant costs to defend\nour intellectual property and other proprietary rights.**\n\n \n\nThe ownership and protection\nof trademarks, patents, trade secrets and intellectual property rights are significant aspects of our future success. Unauthorized parties\nmay attempt to replicate or otherwise obtain and use our products and technology. Policing the unauthorized use of our current or future\ntrademarks, patents, trade secrets or intellectual property rights could be difficult, expensive, time-consuming and unpredictable, as\nmay be enforcing these rights against unauthorized use by others.\n\n \n\nIn addition, other parties\nmay claim that our products infringe on their proprietary rights such as trade secrets. Such claims, regardless of their merit, may result\nin the expenditure of significant financial and managerial resources, legal fees, injunctions, temporary restraining orders and/or require\nthe payment of damages. Additionally, we may need to obtain licenses from third parties who allege that we have infringed on their lawful\nrights. Such licenses may not be available on terms acceptable to us or at all. In addition, we may not be able to obtain or utilize\non terms that are favorable to us, or at all, licenses or other rights with respect to intellectual property that we do not own.\n\n** **\n\n**If we sustain cyber-attacks or other privacy\nor data security incidents that result in security breaches that disrupt our operations or result in the unintended dissemination of\nprotected personal information or proprietary or confidential information, or if we are found by regulators to be non-compliant with\nstatutory requirements for the protection and storage of personal data, we could suffer a loss of revenue, increased costs, exposure\nto significant liability, reputational harm and other serious negative consequences.**\n\n \n\nAs our operations expand,\nwe may process, store and transmit large amounts of data in our operations, including protected personal information as well as proprietary\nor confidential information relating to our business and third parties. Experienced computer programmers and hackers may be able to penetrate\nour layered security controls and misappropriate or compromise our protected personal information or proprietary or confidential information\nor that of third parties, create system disruptions or cause system shutdowns. They also may be able to develop and deploy viruses, worms\nand other malicious software programs that attack our systems or otherwise exploit any security vulnerabilities. Hardware, software,\nor applications we develop or procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly\ncompromise information security. Our facilities may also be vulnerable to security incidents or security attacks, acts of vandalism or\ntheft, coordinated attacks by activist entities, misplaced or lost data, human errors, or other similar events that could negatively\naffect our systems and our customer’s data.\n\n \n\n**We may become involved in litigation matters\nthat are expensive and time consuming, and, if resolved adversely, could harm our reputation, business, financial condition or results\nof operations.**\n\n \n\nWe may become involved in\nlitigation matters that are expensive and time consuming, and, if resolved adversely, could harm our reputation, business, financial\ncondition or results of operations.\n\n \n\n33\n\n \n\n \n\nFor instance, on January 29, 2024, Shailesh Bhushan, our former\nChief Financial Officer, filed a complaint with the Employment Standards Branch of British Columbia claiming unpaid salary and invoices\nin the aggregate amount of CAD $271,990 from the period December 2022 through November 2023. The Company previously offered to Mr. Bhushan\nan annual salary of CAD $60,000 and as such, believes the claim to be frivolous, strongly disputes the amount claimed, and intends to\nvigorously defend itself. Please refer to Note 28 of the Audited Consolidated Financial Statements included in this Annual Report\non Form 20-F for the fiscal year ended December 31, 2025 for details of the legal proceedings with Mr. Bhushan.\n\n \n\nIn January 2024 and January 2025, the Company received subpoenas from\nthe SEC, Division of Enforcement, in an investigation entitled, In the Matter of Halo Collective. The subpoenas requested production of\ncertain documents and information related to, among other things, marketing efforts by third parties, the issuance of shares to consultants,\nthe Company’s spin off from Halo and press releases. We can offer no assurances as to the outcome of the investigation or the potential\naffect, if any, on the Company or the results of our operation.\n\n \n\nManagement is unable to\nassess the likelihood that we would be successful in any trial with respect to ongoing matters. Accordingly, no assurance can be given\nthat if we go to trial and ultimately lose, or if we decide to settle at any time, such an adverse outcome would not be material to our\nconsolidated financial position. Additionally, in any such case, we will likely be required to use available cash, or the proceeds from\nfuture offerings, towards the judgment or settlement, that we otherwise would have used to build our business. In such event, we would\nbe required to raise additional capital sooner than we otherwise would, of which we can give no assurance of success, or delay, curtail\nor cease the commercialization of some or all of our products and services.\n\n \n\n**Declaration, payment and amounts of dividends,\nif any, to stockholders of Akanda will be uncertain.**\n\n \n\nAkanda has not historically\npaid cash dividends on its capital stock. Whether any dividends are declared or paid to stockholders of Akanda, and the amounts of any\nsuch dividends that are declared or paid, are uncertain and depend on a number of factors. The Akanda Board will have the discretion\nto determine the dividend policy of Akanda, including the amount and timing of dividends, if any, that Akanda may declare from time to\ntime, which may be impacted by any of the following factors:\n\n \n\n \n**●**\nAkanda\nmay not have enough cash to pay such dividends or to repurchase shares due to its cash requirements, capital spending plans, cash\nflow or financial position;\n\n \n\n \n●\ndecisions\non whether, when and in which amounts to make any future distributions will remain at all times entirely at the discretion of the\nAkanda Board, which could change its dividend practices at any time and for any reason;\n\n \n\n \n●\nthe amount\nof dividends that Akanda may distribute to its stockholders is subject to restrictions under Canadian law and is limited by restricted\npayment and leverage covenants in any of Akanda’s credit facilities or other indebtedness and, potentially, the terms of any\nfuture indebtedness that Akanda may incur; and\n\n \n\n \n●\ncertain\nlimitations on the amount of dividends subsidiaries of Akanda can distribute to Akanda, as imposed by law, regulators or agreements.\n\n \n\nStockholders should be aware\nthat they have no contractual or other legal right to dividends that have not been declared.\n\n \n\n34"}