{"url_path":"/sec/karo/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/1828102/0001213900-26-066795-index.html","accession_number":"0001213900-26-066795","cik":"0001828102","ticker":"KARO","issuer_name":"Karooooo Ltd.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1828102/0001213900-26-066795-index.html","primary_entity_key":"0001828102","primary_entity_name":"Karooooo Ltd."},"word_count":27421,"has_tables":true,"body_markdown":"**Item\n3. KEY INFORMATION**\n\n** **\n\n \n**A.**\n**RESERVED**\n\n** **\n\n \n**B.**\n**CAPITALIZATION\nAND INDEBTEDNESS**\n\n** **\n\nNot\napplicable.\n\n \n\n \n**C.**\n**REASONS\nFOR THE OFFER AND USE OF PROCEEDS**\n\n** **\n\nNot\napplicable.\n\n \n\n \n**D.**\n**RISK\nFACTORS**\n\n** **\n\n*You\nshould carefully consider the risks and uncertainties described below and the other information in this annual report before making an\ninvestment in our ordinary shares. Our business, financial condition or results of operations could be materially and adversely affected\nif any of these risks occurs and as a result, the market price of our ordinary shares could decline and you could lose all or part of\nyour investment. Additional risks and uncertainties not currently known to us, or which we currently deem immaterial, may also adversely\naffect our business, financial condition or results of operations. This annual report also contains forward-looking statements that involve\nrisks and uncertainties. See “Special Note Regarding Forward-Looking Statements”. Our actual results could differ materially\nand adversely from those anticipated in these forward-looking statements as a result of certain factors, including the risks described\nbelow and elsewhere in this annual report.*\n\n* *\n\n*A\nsummary of the risk factors is followed by a detailed description of each risk factor.*\n\n* *\n\n**RISK\nFACTOR SUMMARY**\n\n** **\n\n**Risks\nRelating to Our Business and Operations**\n\n** **\n\n \n●\nWe\nmay not be able to add new customers and retain existing customers, which could have a material adverse effect on our ability to\ngrow our business and increase revenue.\n\n \n\n \n●\nWe\nmay not be able to retain or drive margin expansion with our existing customers, which could adversely affect our financial results.\n\n \n\n1\n\n \n\n \n\n \n●\nThe\neffects of macroeconomic and geopolitical events on our business, customers and partners – including  , the conflicts\nin the Middle East and related disruptions to shipping, the Russia-Ukraine conflict, political and economic uncertainty in Mozambique,\ngeopolitical tensions involving China, financial distress caused by bank failures, global supply chain disruptions, foreign currency\nfluctuations, elevated inflation and interest rates, shifting trade, tariff and monetary policies, and pandemic or widespread outbreak\nof illnesses, could have a material adverse effect on our business, financial condition and results of operations.\n\n \n\n \n●\nOur\ninability to adapt to rapid technological change, including artificial intelligence, in our industry and related industries, could\nimpair our ability to remain competitive and adversely affect the results of our operations.\n\n \n\n \n●\nOur\ninability to successfully recover should we experience a disaster or other business continuity issue could cause material financial\nloss, loss of human capital, regulatory actions, reputational harm and/or legal liability.\n\n \n\n \n●\nThe\nglobal market for fleet management and operational intelligence solutions is highly fragmented and competitive. If we do not compete\neffectively in such markets, our operating results may be harmed.\n\n \n\n \n●\nAn\nincrease in factory-fitted or embedded telematics technology in new vehicles in our markets could result in reduced demand for our\noperational intelligence platform, which could have a material adverse effect on our revenue.\n\n \n\n \n●\nOur\ndependence on various lead generation programs could adversely affect our operating results if we are required to pay more for such\nprograms or we are unable to attract new customers at the same historic rate.\n\n \n\n \n●\nIf\nwe are unable to successfully convert customer sales leads into customer sales on a cost-effective basis, our revenue and results\nof operations would be adversely affected.\n\n \n\n2\n\n \n\n \n\n**Risks\nRelating to Our Reliance on Third Parties**\n\n** **\n\n \n●\nThe\nconduct of third-party security officers engaged in stolen vehicle recovery (“SVR”) operations in support of our services\nfrom time to time involves the use of force, which could expose the Company to reputational harm or, potentially, civil and/or criminal\nliability.\n\n \n\n \n●\nWe\ndepend on certain key suppliers, telemetry and video hardware vendors and original equipment manufacturers (“OEM”) as\npart of our hardware manufacturing process, procurement and customer acquisition process. An interruption in the supply of components,\nthird party hardware vendors and OEM fitted telemetry could impair our customer acquisition process.\n\n \n\n \n●\nWe\ndepend on specific open-source software and third-party software licenses, and the inability to license or use such software from\nthird parties could render our platform inoperable or pose other risks.\n\n \n\n**Risks\nRelating to Our Growth Strategy**\n\n** **\n\n \n●\nWe\nhave experienced growth in recent periods. If we fail to manage our growth effectively, we may be unable to execute our business\nplan, maintain high levels of service or address competitive challenges adequately.\n\n \n\n \n●\nWe\nmay not effectively execute on our expansion strategy, which may adversely affect our ability to maintain our historical growth and\nearnings trends.\n\n \n\n \n●\nInvestments\ninto our operational intelligence platform and technology infrastructure may not yield the desired results.\n\n \n\n \n●\nIf\nwe fail to maintain or enhance our brand recognition or reputation, our business could be harmed.\n\n \n\n \n●\nOur\ncorporate culture has contributed to our success, and if we cannot maintain this culture, we could lose the innovation, creativity\nand teamwork fostered by our culture, which could harm our business.\n\n \n\n**Risks\nRelating to Our Intellectual Property, Data Privacy and Cybersecurity**\n\n** **\n\n \n●\nEvolving\nregulation and changes in applicable laws relating to the Internet, data privacy and cybersecurity may increase our expenditure on\ncompliance measures or otherwise limit the solutions we can offer, which may harm our business and adversely affect our financial\ncondition.\n\n \n\n \n●\nAny\nsignificant disruption in service on our operational intelligence platform or in our computer systems, through cybersecurity breaches,\ncomputer viruses or otherwise or disruption of our platform, including as a result of artificial intelligence, could damage our reputation\nand result in a loss of customers, which would harm our business and results of operations.\n\n \n\n3\n\n \n\n \n\n \n●\nSecurity\nor privacy breaches in our electronic transactions or data may expose us to additional liability, regulatory sanctions or result\nin a loss of customers, all of which events could harm our business.\n\n \n\n \n●\nThe\ndevelopment and maintenance of systems to increase cyber resilience is costly and requires ongoing monitoring and updating to address\nincreasing prevalence and sophistication of cyberattacks. The preventive actions we take to reduce the risks associated with cyberattacks,\nincluding protection of our systems and networks, may be insufficient to repel or mitigate the effects of a cyberattack in the future.\n\n \n \n \n\n \n●\nAny\ncybersecurity threats or previous cybersecurity incidents could affect our business, results of operations or financial conditions.\n\n \n\n**Risks\nRelated to Legal Proceedings**\n\n** **\n\n \n●\nWe\nmay incur material losses and costs as a result of lawsuits or claims that may be brought against us which are related to product\nliability, warranty, product recalls, client service interruptions, patent infringement or other matters, and any litigation against\nus could be costly and time-consuming to defend and could harm our business, financial condition and results of operations.\n\n \n\n**Risks\nRelating to Our Operations in South Africa and Other Emerging Markets**\n\n** **\n\n \n●\n\nWe\nconduct a material amount of our business in foreign currencies, which heightens our exposure\nto the risk of exchange rate fluctuations.\n\n \n\n●Operating\nin emerging markets is impacted by infrastructure deficits, energy insecurity, poor governance,\npolitical instability, macroeconomic volatility and cultural challenges, which could negatively\nimpact our business, financial condition and results of operations.\n\n \n\n**Risks\nRelating to Investments in Singapore Companies**\n\n** **\n\n \n●\nWe\nare incorporated in Singapore, and our shareholders may have more difficulty in protecting their interests than they would as shareholders\nof a corporation incorporated in the United States.\n\n \n\n**Risks\nRelating to Our Ordinary Shares**\n\n** **\n\n \n●\nOur\nstock price may fluctuate and you could lose all or a significant part of your investment.\n\n \n\n \n●\nAs\na foreign private issuer and “controlled company” within the meaning of the Nasdaq rules, we are permitted to, and we\nwill, rely on exemptions from certain corporate governance standards. Our reliance on such exemptions may afford less protection\nto holders of our ordinary shares.\n\n \n\n \n●\nIf\nwe fail, for any reason, to effectively or efficiently maintain proper internal control procedures for compliance with the Sarbanes\nOxley Act of 2002 (“SOX”), or Section 404 of SOX, such failure could materially and adversely affect our business, results\nof operations and financial condition.\n\n \n\n4\n\n \n\n \n\n**RISK\nFACTORS**\n\n** **\n\n**Risks\nRelating to Our Business and Operations**\n\n** **\n\n**We\nmay not be able to add new customers and retain existing customers, which could have a material adverse effect on our ability to grow\nour business and increase revenue.**\n\n** **\n\nWe\nmarket and sell our mobility data analytics solutions to a wide range of customers, from consumers and sole proprietors to small and\nmedium-sized businesses and large enterprises. To grow our revenue, we must continue to add new customers and subscribers and retain\nexisting subscribers. Our strategy is to increase new subscription sales by increasing penetration in our existing markets and with existing\ncustomers, upgrading and enhancing our platform and solutions and by opportunistically entering new markets that represent a potential\nsource of demand. Our success in adding new customers may be tied to a number of factors, including demand for our operational intelligence\nplatform, the rate of new vehicle sales, the success of our sales and marketing campaigns, our ability to generate leads, our relationships\nwith channel partners, price and service competition, general economic conditions and, in the case of our safety and security services,\nthe real and perceived threat of vehicle theft and discounts offered by insurers for risk mitigation.\n\n \n\nSelling\nto consumers or sole proprietors and small business customers may, in some instances, be more difficult than selling to medium-sized\nbusinesses and large enterprise customers. Consumers and sole proprietors and small businesses may have higher default rates, are price\nsensitive, may be difficult to reach with targeted sales campaigns and may have higher churn rates, in part because of the scale of their\nbusinesses and the ease of switching solutions.\n\n \n\nOn\nthe other hand, the typical sales cycle for medium-sized businesses and larger enterprises may be longer than that of our consumer, sole\nproprietor and small business customers. These customers may have more complex business, operational, procurement, integration and contractual\nrequirements and their scale may result in less favorable contract terms. Our sales cycle runs from lead generation to the installation\nof the device. Our typical sales cycle for large enterprises ranges from 3 to 24 months. Medium enterprise sales cycles run between 1\nto 8 months with small business and sole proprietor sale cycles running between 1 to 90 days. The consumer sales cycle runs between 1\nand 60 days. A number of factors influence the length and variability of our sales cycle, including the need to educate potential customers\nabout the uses and benefits of our solutions, the discretionary nature of purchasing and budget cycles, and the competitive nature of\nevaluation and purchasing approval processes. It may be difficult for us to predict the timing of when we will enter into subscription\ncontracts with medium-sized businesses and large enterprises and how quickly such contracts can be implemented. This could make the timing\nof our revenues uncertain and difficult to predict.\n\n \n\n**We\nmay not be able to retain or drive margin expansion with our existing customers, which could adversely affect our financial results.**\n\n** **\n\nWe\ngenerally sell our operational intelligence platform pursuant to subscription agreements with an initial minimum term of 36 months. The\nmajority of these agreements provide for automatic renewal on a month-to-month basis thereafter unless the customer elects otherwise.\nOur customers have no obligation to renew all or any of these agreements after the expiration of the initial term or any renewal term.\nIf our efforts to satisfy our existing customers are not successful, we may not be able to retain them or expand our relationship with\nthem and, as a result, our revenue and growth could be materially and adversely affected. Customers may choose to cancel or not renew\ntheir subscriptions or to downsize their subscriptions for a number of reasons, including the belief that our solutions are not required\nfor their personal or business needs or are otherwise not as cost-effective as initially anticipated, a desire to reduce discretionary\nspending, a belief that our competitors’ solutions provide better value, an economic downturn in their industries or the markets\nin which they operate, and customers may not renew their subscriptions when they refresh their fleet with new vehicles. Large enterprise\ncustomers may also decrease the number of vehicles covered by subscription contracts if their fleet sizes decrease. Additionally, our\ncustomers may cancel or not renew for reasons entirely out of our control, such as the dissolution of their business or personal financial\ndistress.\n\n \n\n5\n\n \n\n \n\nPart\nof our growth strategy is to retain customers and drive margin expansion by providing enhanced and additional software solutions to existing\ncustomers while keeping our costs low. Our ability to provide an advanced software platform to existing customers in a cost-effective\nmanner depends, in significant part, on our ability to anticipate industry evolution, practices and standards and to continue to enhance\nour platform and existing software solutions, such as integration with fuel cards, GPS navigation devices, as well as various third-party\nsoftware and products manufactured by original equipment manufacturers (“OEMs”), or partnership with vehicle insurance providers,\nor to introduce or acquire new software features on a timely basis to keep pace with technological developments both within our industry\nand in related industries, including integration with developing technologies and platforms such as artificial intelligence (“AI”),\nmachine learning and big data analytics. However, we may prove unsuccessful either in developing new software features or in expanding\nthe third-party software and products with which our operational intelligence platform integrates, such third-party software and products\nmay become incompatible or replace our solutions, and such efforts may not be cost-effective – See “Our platform integrates\nwith third-party technologies and if our platform becomes incompatible with these technologies, our platform would lose functionality\nand flexibility and our customer acquisition and retention could be adversely affected.” In addition, the success of any enhancement\nor new feature depends on several factors, including the timely completion, introduction and market acceptance of the enhancement or\nfeature. Any new software applications or features we develop or acquire might not be introduced in a timely or cost-effective manner\nand might not achieve the broad market acceptance necessary to generate significant revenue. If any of our competitors implements new\ntechnologies before we are able to implement them, better anticipates the innovation and integration opportunities in related industries\nor implements them in a more cost-effective manner, those competitors may be able to provide more effective or less expensive solutions\nthan ours, which may also negatively affect our ability to retain our existing customers and drive margin expansion.\n\n \n\n**The\neffects of macroeconomic and geopolitical events, , including the conflicts in the Middle East and related disruptions to shipping, the\nRussia-Ukraine conflict, political and economic uncertainty in Mozambique, geopolitical tensions involving China, financial distress\ncaused by bank failures, global supply chain disruptions, foreign currency fluctuations, elevated inflation and interest rates, shifting\ntrade, tariff and monetary policies, and pandemics or widespread outbreaks of illnesses, could have a material adverse effect on our\nbusiness, financial condition and results of operations.**\n\n** **\n\nOur\ngrowth strategy involves further expansion of our operations and customer base internationally. Macroeconomic and geopolitical events,\ncan disrupt our business, customers or partners. These include conflicts in the Middle East and related shipping disruptions, the Russia-Ukraine\nconflict, political and economic uncertainty in Mozambique, geopolitical tensions involving China, financial distress caused by bank\nfailures, global supply chain disruptions, foreign currency fluctuations, elevated inflation and interest rates, shifting trade, tariff\nand monetary policies, and pandemics or widespread outbreaks of illnesses, create increased uncertainty and strain on the global economy\nand could have a material adverse effect on our business, financial condition and results of operations. The conflicts in the Middle\nEast have caused serious disruption to the economies of the most directly affected countries, such as the UAE, in which we have a presence,\nnegatively affecting their short-term growth prospects.\n\n \n\nSince\nthe October 2024 elections, Mozambique continues to grapple with political and economic uncertainty, with an ongoing insurrection in\nthe north and limited institutional capacity. Frequent natural disasters exacerbate these vulnerabilities. While the situation has stabilized\ncompared to the immediate post-election period, underlying challenges remain. During the height of the disruption, we temporarily suspended\nbilling to support our customers. Although normal operations have largely resumed, activity levels have not fully recovered to pre-election\nlevels, and the operating environment remains constrained**.** The continued weakness of the Mozambican metical against the\nSouth African rand, particularly since early 2025, has further intensified the decline in reported revenue. The ongoing uncertainty could\ncontinue to have an adverse effect on our business in Mozambique.\n\n \n\n6\n\n \n\n \n\nGeopolitical\ntensions, including the ongoing conflict between Russia and Ukraine, may adversely impact the economies of neighboring countries, such\nas Poland, in which we have a presence. Similarly, conflicts in the Middle East may negatively impact the economies of countries like\nthe UAE, in which we have a presence. We expect minimal growth in the UAE and may have to suspend billing to support and retain our UAE\ncustomers. We have already experienced an increase in the costs of fitment and sales in Asia, due to sharp increases in fuel prices.\nAny increase in tensions between China and Taiwan, or other countries, including threats of military actions or escalation of military\nactivities, could adversely affect our supply chain partners’ operations in these areas – See “We depend on certain\nkey suppliers and vendors as part of our hardware manufacturing process. An interruption in the supply chain could impair our product\navailability, adversely affecting distribution and growth.”\n\n \n\nThe\nevolving global energy crisis could continue to significantly disrupt supply chains and cause uncertainty in the global economy, which\ncould negatively impact our business prospects. In South Africa, progress has been made in stabilizing the electricity grid, but the\ngovernment owned power utility’s ability to meet electricity demand remains a concern, and could continue to have an adverse effect\non our business, financial condition and results of operations.\n\n \n\nWe\nare subject to fluctuations in foreign exchange rates between the South African rand, our reporting currency, and currencies of other\ncountries where we market our solutions or source our raw components, for example the Euro, Singapore dollar, U.S. dollar,\nPolish zloty and Mozambican metical. Such fluctuations may result in significant increases or decreases in our reported revenue and other\nresults as expressed in South African rand, and in the reported value of our assets, liabilities and cash flows – See “Risks\nRelating to Our Operations in South Africa and Other Emerging Markets”.\n\n \n\nTrade\nbarriers, including tariffs, import and export restrictions, and evolving geopolitical trade policies in regions where we operate may\ndisrupt supply chain logistics, and affect the manufacturing of our core hardware, which could negatively impact our revenue growth and\noperating margins. As such, changes or uncertainties, including in international trade relations, legislation and regulations (including\nthose related to tariffs, taxation and importation), enforcement priorities, or economic and monetary policies, could result in heightened\ndiplomatic tensions or political and civil unrest, among other potential impacts, may have a material adverse effect on the global economy\nas a whole and/or our business, or may require us to significantly modify one or more of our current business practices.\n\n \n\nThe\nimpact of these risks may also have the effect of heightening many of the other risks described in this “Risk Factors” section\nor otherwise directly or indirectly impact our business in unpredictable ways.\n\n \n\n**Our\ninability to adapt to rapid technological change, including artificial intelligence in our industry and related industries could impair\nour ability to remain competitive and adversely affect our results of operations.**\n\n** **\n\nThe\nindustry in which we operate, and related industries, are characterized by rapid technological change, frequent introductions of new\napplications and evolving industry standards. In addition to the telematics or fleet management industry, we are subject to changes in\nthe automotive software and technology industry with rapid technological advancement to mobile handsets, multi-functional driver terminals,\non-board cameras, advanced driver-assistance systems (“ADAS”) and workflow management software. As the technology used in\neach of these industries evolves, we will face new integration and competition challenges. For example, as mobile handsets have evolved\nto include GPS tracking technology, they have become competitors against our solutions. Additionally, ADAS technology, with embedded\nAI, may have features that are similar to or overlap with our solutions. Furthermore, major gains in fuel efficiency and electric automobiles\nmay lead to a relative decrease in the demonstrable return on investment of our solutions as perceived by our customers. If we are unable\nto adapt to rapid technological change, it could have a material adverse effect on our results of operations and our ability to remain\ncompetitive.\n\n \n\n7\n\n \n\n \n\n**Our\nplatform integrates with third-party technologies and if our platform becomes incompatible with these technologies, our platform would\nlose functionality and flexibility and our customer acquisition and retention could be adversely affected.**\n\n** **\n\nOur\nplatform integrates with third-party software and devices to allow our platform to perform key functions. For example, we offer integration\nwith work-flow software products, such as business intelligence software, enterprise resource planning systems, routing and scheduling\nand freight management logistics billing systems, among others. Although to date this integration has been accomplished using application\nprogramming interfaces (“API”), other open software interfaces and simple physical linkages, we cannot guarantee that this\nease of integration will continue or that we will be able to integrate with other products as easily in future or without additional\ncost. Newer vehicles and devices may be developed, which include different ports and do not allow for our platform to be integrated through\nsimple physical linkages. Further, the risk exists that undetected errors, viruses or bugs may be present in third-party software that\nour customers use in conjunction with our platform.\n\n \n\nChanges\nto third-party software that our customers use in conjunction with our platform could also render our platform inoperable. Customers\nmay conclude that our software is the cause of these errors, bugs or viruses and terminate their subscriptions. The inability to easily\nintegrate with, or any defects in, third-party software could result in increased costs, or in delays in software releases or updates\nto our platform until such issues have been resolved, which could have a material adverse effect on our business, financial condition,\nresults of operations, cash flows and future prospects and could damage our reputation.\n\n \n\n**Our\nsoftware solutions rely on cellular (GSM/LTE) and GNSS (including GPS, Glonass, Galileo) or regionally equivalent networks (including\nQZSS) and any disruption, failure or increase in costs could impede our profitability and harm our financial results.**\n\n** **\n\nTwo\ncritical links in our current solutions are between telematics devices and GPS or equivalent Global Navigation Satellite Systems (“GNSS”)\nsuch as Glonass, Galileo and Quasi-Zenith Satellite System (“QZSS”) and between telematics devices and cellular networks,\nwhich allow us to obtain location data and transmit it to our system. Increases in the fees charged by cellular carriers for data transmission\nor changes in the cellular networks, such as a cellular carrier discontinuing support of the network currently used by our telematics\ndevices, requiring retrofitting of our telematics devices, could increase our costs and impact our profitability. We have initiated a\nprocess to migrate new installations to the next generation of cellular network compatibility in order to maximize expected useful life\nof our telematics devices, however, cellular carriers could in the future migrate allotted bandwidth from one network to another. Also,\nwhile we have included the ability to store GPS data in our telematics devices in case of temporary cellular network connectivity failure,\nwidespread disruptions or extended failures of the cellular networks would materially and adversely affect our solutions’ functionality\nand utility and harm our financial results.\n\n \n\nGPS-equivalent\nservices like Glonass, Galileo and QZSS are satellite-based positioning systems consisting of a constellation of orbiting satellites.\nThese satellites and their ground support systems are complex electronic systems subject to electronic and mechanical failures and possible\nsabotage and it is not certain that the various government agencies will remain committed to the operation and maintenance of such satellites\nover a long period. In addition, technologies that rely on GPS or Glonass, Galileo and QZSS depend on the use of radio frequency bands\nand any modification of the permitted uses of these bands may adversely affect the functionality of such satellites and, in turn, our\nsolutions.\n\n \n\n8\n\n \n\n \n\nMany\nGPS satellites currently in orbit have outlived their expected lifespans and are subject to damage by the hostile space environment in\nwhich they operate. If a significant number of satellites were to become inoperable, there could be a substantial delay before they are\nreplaced with new satellites. A reduction in the number of operating satellites below the 24-satellite standard established for GPS may\nimpair the utility of the GPS system and the growth of current and additional market opportunities. In addition, natural phenomena such\nas solar storms, software updates to GPS satellites and ground control segments, and infrequent known constellation-related events, such\nas GPS week number rollover, may adversely affect our products and customers. We depend on public access to open technical specifications\nin advance of system updates to mitigate these problems, which may not be available or complete.\n\n \n\nThe\nGPS satellites and their ground control and monitoring stations are maintained and operated by the U.S. Department of Defense. The Department\nof Defense does not currently charge users for access to the satellite signals, but we cannot provide assurance that they will not do\nso in the future. It is also possible that agencies that operate GPS equivalent services like Glonass, Galileo and QZSS begin to charge\nusers for access. Any such disruption, failure or increase in costs could impede the functionality and/or cost of our solutions which\ncould have a material adverse effect on our financial condition and results of operations.\n\n \n\n**The\npace of 5G adoption is uncertain, and we may not be able to meet customer expectations and timelines.**\n\n** **\n\n5G\nadoption continues to grow, but at different speeds across the countries where we operate. The 5G market may require us to design hardware\nthat meets certain technical specifications. If 5G is adopted faster than we expect, we may have difficulty introducing new solutions\nand meeting such technical specifications within the expected timelines. If 5G is adopted more slowly than we expect, we may not realize\nthe growth we anticipate, and our related investments may not pay off as planned. If we are unable to manage challenges with regard to\n5G markets and related opportunities, it could have a material adverse effect on our financial condition and results of operations.\n\n \n\n**Our\ninability to successfully recover should we experience a disaster or other business continuity issue could cause material financial loss,\nloss of human capital, regulatory actions, reputational harm and/or legal liability.**\n\n** **\n\nShould\nwe experience a local or regional disaster or other business continuity problem, such as an earthquake, hurricane, terrorist attack,\npandemic, security breach, power loss, telecommunications failure or other natural or man-made disaster, our continued success will depend,\nin part, on the availability of personnel, office facilities, and the proper functioning of computer, telecommunication and other related\nsystems and operations. We could potentially experience material adverse interruptions to our operations or delivery of services to customers\nin a disaster recovery scenario.\n\n \n\nFor\nexample, due to historic levels of relative under-investment in infrastructure, in particular, electricity, the South African government\nowned power utility, Eskom, continues electricity rationing and planned blackouts due to its inability to meet demand. Although we have\nmade contingency arrangements for use of generators at our various locations, the lack of a constant, reliable supply of electricity\ncould have a material adverse effect on our business, financial condition and results of operations.\n\n \n\nEven\nwith our disaster recovery arrangements in place, our services could be interrupted. Our suppliers and customers are also subject to\nthe risk of catastrophic events. In those circumstances, our ability to deliver our services in a timely manner, as well as the demand\nfor our solutions, may be adversely impacted by factors outside our control. If our systems were to fail or be negatively impacted as\na result of a natural disaster, pandemic or other catastrophic event, the ability to deliver our services to our customers would be impaired,\nour reputation could suffer and we could be subject to contractual penalties.\n\n \n\n9\n\n \n\n \n\n**The\nglobal market for fleet management and operational intelligence solutions is highly fragmented and competitive. If we do not compete\neffectively in such markets, our operating results may be harmed.**\n\n** **\n\nThe\nglobal market for fleet management and operational intelligence solutions, including telematics, tracking and mobility solutions, is\nhighly fragmented, competitive and rapidly changing. Competition in such markets is based primarily on the level of difficulty in installing,\nusing and maintaining solutions, total cost of ownership, product performance, functionality, customer service, interoperability, brand\nand reputation, distribution channels, industries and the financial resources of the vendor. We expect competition in such markets to\nintensify in the future with the introduction of new technologies and market entrants.\n\n \n\nThe\nglobal market for fleet management and operational intelligence solutions is highly competitive. Our growth will depend, in part, on\na combination of the continued growth in the market for these solutions, our ability to increase our market share and our customers’\ncontinued operation in the regions in which we operate. We compete with a number of companies in each of the geographic markets in which\nwe operate, some of which have established sizable market shares in the relevant markets. We expect competition to intensify in the future\nwith the introduction of new technologies, the use of mobile devices and new market entrants from outside the telematics industry, such\nas enterprise software vendors or large technology companies expanding into the category. As competition intensifies, we expect that\nprice competition for telematics solutions, including fleet management and operational intelligence solutions, to intensify, which could\ncause our revenues to decline and have a material adverse effect on our results of operations.\n\n \n\nFor\nexample, mobile service providers and global software platforms, such as Google, provide limited services at lower prices or at no charge,\nsuch as basic GPS based mapping, tracking and turn-by-turn navigation that could be expanded or further developed to more directly compete\nwith our operational intelligence solutions. In addition, wireless carriers, such as Verizon, offer SaaS fleet management solutions that\nbenefit from the carrier’s scale and cost advantages, which we may be unable to match. Similarly, vehicle OEMs may provide factory\nembedded or after-market installed devices and effectively compete against us by directly or indirectly partnering with other fleet management\nservice providers. Furthermore, companies such as Google, Amazon and others have substantially greater financial, technical and marketing\nresources, relationships with large vendor partners, larger global presence, larger customer bases, longer operating histories, greater\nbrand recognition and more established relationships than we do and may decide to compete in the market for fleet management and operational\nintelligence solutions.\n\n \n\nSuch\ncompetition could result in reduced operating margins, increased sales and marketing expenses and the loss of market share, any of which\ncould have a material adverse effect on our results of operations.\n\n \n\n**Industry\nconsolidation may give our competitors advantages over us, which could result in a loss of customers and/or a reduction in revenue.**\n\n** **\n\nSome\nof our competitors have made or may make acquisitions or enter into partnerships or other strategic relationships to offer more comprehensive\nservices or achieve greater economies of scale. In addition, new entrants not currently considered competitors may enter our market through\nacquisitions, partnerships or strategic relationships. Potential entrants may have competitive advantages over us, such as greater name\nrecognition, longer operating histories, more varied services and larger marketing budgets, as well as greater financial, technical and\nother resources. Industry consolidation may result in competitors with more compelling service offerings or greater pricing flexibility\nthan we have or business practices that make it more difficult for us to compete effectively, including on the basis of price, sales\nand marketing programs, technology or service functionality. These pressures could result in a loss of subscribers and/or a reduction\nin revenue.\n\n \n\n**Failure\nof businesses to adopt fleet management and operational intelligence solutions could reduce the demand for our platform.**\n\n** **\n\nWe\nderive, and expect to continue to derive, substantial revenue from the sale of subscriptions to customers choosing our operational intelligence\nplatform. Widespread acceptance and usage of fleet management and operational intelligence solutions is critical to our future revenue\ngrowth and success. If the market for fleet management and operational intelligence solutions fail to grow, or grows more slowly than\nwe currently anticipate, demand for our solutions would be negatively affected.\n\n \n\n10\n\n \n\n \n\nThe\nmarket for fleet management and operational intelligence solutions is subject to changing customer demand and trends in preferences.\nSome of the potential factors that could affect interest in and demand for fleet management and operational intelligence solutions include:\n\n \n\n \n●\nthe\neffectiveness and reliability of the software platforms;\n\n \n\n \n●\nfluctuations\nin fuel and vehicle maintenance costs, which are significant drivers of customer demand for fleet management and operational intelligence\nsolutions;\n\n \n\n \n●\nassumptions\nregarding general mobile workforce inefficiency and the extent to which efficiency can be improved through fleet management and operational\nintelligence solutions;\n\n \n\n \n●\nthe\nextent of governmental and regulatory burden placed on the fields of transportation and occupational health and safety;\n\n \n\n \n●\nthe\nprice, performance, features, functionality, customer service and availability of solutions that compete with ours; and\n\n \n\n \n●\nour\nability to maintain high levels of customer satisfaction.\n\n \n\nFailure\nof businesses to adopt fleet management and operational intelligence solutions could have a material adverse effect on our business,\nresults of operations and financial condition.\n\n \n\n**Automotive\nmarket conditions and the evolving nature of the automotive industry towards autonomous vehicles could adversely affect demand for our\nsolutions.**\n\n** **\n\nNew\nvehicle sales may decline for various reasons, including adverse changes in the general economic environment, a reduction in our customers’\ndiscretionary spending or an increase in new vehicle tariffs, taxes or fuel prices. A decline in vehicle production levels or labor disputes\naffecting the automobile industry in the markets in which we operate may also impact the volume of new vehicle sales. A decline in vehicle\nproduction levels or sales of new vehicles in the markets in which we operate could result in a long-term decrease in the overall number\nof vehicles and consequently, a decrease in our total addressable market, resulting in reduced demand for our solutions which could have\na material adverse effect on our business, results of operations and financial condition.\n\n \n\nThe\nautomotive industry is also increasingly focused on the development of Autonomous Driving (“AD”) and Advanced Driver Assistance\nSystem (“ADAS”) technologies, including the utilization of artificial intelligence, with the goal of developing and introducing\na commercially viable, fully automated driving experience. There has also been an increase in consumer preferences for mobility on demand\n(“MoD”) services, such as vehicle and ride-sharing, as opposed to automobile ownership, which may result in a long-term reduction\nin the number of vehicles per capita and sales of new vehicles. A reduction in the number of vehicles per capita and sales of new vehicles\ncould reduce our addressable market for solutions.\n\n \n\nThe\nincrease in MoD services has also attracted increased competition from entrants outside the traditional automotive industry. If we do\nnot continue to innovate to develop or acquire new and compelling solutions that capitalize upon new technologies in response to OEM\nand consumer preferences, this could have a material adverse effect on our results of operations.\n\n \n\n**An\nincrease in factory-fitted or embedded telematics technology in new vehicles in our markets could result in reduced demand for our operational\nintelligence platform, which could have a material adverse effect on our revenue.**\n\n** **\n\nCertain\nOEMs have begun embedding technology similar to our own technology in new vehicles prior to their initial sale, creating the potential\nfor products and services that may overlap with our operational intelligence platform. This may preclude us from increasing sales to\ncustomers purchasing such vehicles. The inability to market and sell our solutions to new customers or partner with OEMs to embed our\nsolutions into their devices prior to their initial sale could have a material adverse effect on our ability to grow our subscriber base\nand increase revenue.\n\n \n\n11\n\n \n\n \n\n**Our\ndependence on various lead generation programs could adversely affect our operating results if we need to pay more for such programs\nor we are unable to attract new customers at the same rate.**\n\n** **\n\nWe\nuse a number of lead generation channels to promote our operational intelligence platform, along with inside sales and field sales teams.\nSignificant increases in the costs of one or more of our lead generation channels would increase our overall lead generation costs or\ncause us to choose less expensive and perhaps less effective channels. For example, a portion of our potential customers locate our website\nthrough search engines and social media platforms, representing one of the most efficient means for generating cost-effective customer\nleads. If search engine companies modify their search algorithms in a manner that reduces the prominence of our listing, or if our competitors’\nsearch engine optimization efforts are more successful than ours, fewer potential customers may click through to our website or lead\npages. In addition, the cost of purchased listings has increased in the past and may continue to increase in the future. In regions where\nwe are reliant on inside sales and field sales teams, an increase in labor costs may increase our lead generation costs and cost of customer\nacquisition. As we add to or change the mix of our lead generation strategies, we may need to expand into channels with significantly\nhigher costs than our current channels, which could have a material adverse effect on our cost of subscriber acquisition and results\nof operations. If we are unable to maintain effective advertising programs, our ability to attract new customers could be materially\nand adversely affected and our advertising and marketing expenses could increase substantially, further affecting our results of operations.\n\n \n\n**If\nwe are unable to successfully convert customer sales leads into customers on a cost-effective basis, our revenue and results of operations\nwould be adversely affected.**\n\n** **\n\nWe\ngenerate a substantial amount of our revenue from the sale of subscriptions to our operational intelligence platform. In order to grow,\nwe must continue to efficiently and cost effectively convert customer leads, many of whom have not previously used fleet management and\noperational intelligence solutions, into customers.\n\n \n\nWe\nrely on our inside sales teams and our field sales representatives to drive cost-effective conversion of customer leads into customers.\nTo execute our growth plan, we must continue to attract and retain highly qualified inside sales and field sales personnel. We may experience\ndifficulty in hiring, training and retaining highly skilled inside sales and field sales personnel. An inability to convert customer\nsales leads into customers on a cost-effective basis could have a material adverse effect on our financial condition and results of operations.\nSee “—The loss of one or more of our key management team members or personnel, or our failure to attract, train and retain\nother highly qualified personnel, could harm our business,” below.\n\n \n\n**An\nactual or perceived reduction in theft rates may adversely impact demand for certain of our applications, which could result in a loss\nof customers and a decline in growth.**\n\n** **\n\nDemand\nfor our vehicle tracking and asset recovery solutions is influenced by prevailing or expected theft rates. Vehicle theft rates may decline\nas a result of various factors, such as the availability of improved security systems, implementation of improved or more effective law\nenforcement measures and improved economic or political conditions in markets that have high theft rates. If vehicle theft rates in our\nmarkets decline significantly, or if vehicle owners or insurance companies believe that vehicle theft rates have declined or are expected\nto decline, demand for some of our operational intelligence platform applications may decline, which could result in a loss of customers\nand a decline in growth.\n\n \n\n**We\nare subject to the risk of defaults by our customers and business partners.**\n\n** **\n\nEntering\ninto subscription agreements with customers, particularly consumers and sole proprietors whose credit may not be as strong as that of\nour large enterprise customers, exposes us to credit risk in the event of customer defaults, and we may not be paid all amounts due under\nour subscription agreements. In deciding whether to enter into subscription agreements with prospective customers, we may rely on information\nfurnished by or on behalf of them. We may also rely on representations of those prospective customers as to the accuracy and completeness\nof that information. The inaccuracy of such information or representations affects our ability to accurately evaluate the credit risk\nof a customer, and an increase in the default rates of our customers could have a material adverse effect on our business, results of\noperations and financial condition.\n\n \n\n12\n\n \n\n \n\nAlthough\nbank failures in the United States and Europe have prompted global regulators to implement resolution plans to handle failures of systemically\nimportant banks, the risk of banks and financial institutions winding down and liquidating, entering receivership or becoming insolvent\nin the future in response to financial conditions affecting the banking system and financial markets, remains, which may cause our customers\nand business partners to face difficulties accessing cash, cash equivalents or financing. This would lead to an increase in default rates\nand could have an adverse effect on our business, results of operations and financial condition.\n\n \n\nIn\naddition, the Middle Eastern conflicts, political and economic uncertainty in Mozambique, currency fluctuations and elevated inflation\nand interest rates has made the operating environment challenging and has disrupted our customers’ normal operations, which may\ncause an increase in the default rates of our customers and could lead to an adverse effect on our business, results of operations and\nfinancial condition.\n\n \n\n**We\nprovide minimum service level commitments to certain of our customers, and our failure to meet them could cause us to issue credits for\nfuture subscriptions, which could harm our results of operations.**\n\n** **\n\nCertain\nof our subscription agreements currently, and may in the future, provide minimum service level commitments regarding items such as unit\nand platform uptime, functionality, platform performance or operational turnaround times. If we are unable to meet the stated service\nlevel commitments for these subscribers or suffer extended periods of service unavailability, we are or may be contractually obligated\nto provide these subscribers with credits for future subscriptions, or provide services at no cost, which could adversely impact our\nrevenue.\n\n \n\n**Risks\nRelating to Our Reliance on Third Parties**\n\n** **\n\n**The\nconduct of third-party security officers engaged in stolen vehicle recovery (“SVR”) operations in support of our services\nfrom time to time involves the use of force, which could expose the Company to reputational harm or, potentially, civil and/or criminal\nliability.**\n\n** **\n\nWe\nwork with local law enforcement authorities and licensed third-party security officers to recover our customers’ stolen vehicles.\nThese recovery teams are armed and undergo training on recovery procedures including conflict management and the controlled use of force\nin response to threats, including being the target of gunfire by vehicle theft suspects.\n\n \n\nSVR\noperations in South Africa, which are provided in connection with our services, are conducted under an arm’s length agreement by\na third-party service provider, for which the agreement requires the service provider to comply with local law and our policies and procedures\nrelated to SVR operations.\n\n \n\nFrom\nMarch 1, 2020 through February 28, 2026, 0.028% of SVR operations conducted by our service provider have resulted in injury or death\nas a result of weapons discharge. While in each of these incidents local law enforcement authorities determined that the security\nofficers engaged in the action acted lawfully and in compliance with the policies and procedures outlined in our service level agreement\nwith the service provider, there can be no assurance that a later determination will not find fault on the part of such security personnel.\n\n \n\nIn\nlight of the nature of SVR operations, future incidents in which force is required are likely to occur. If the security officers engaged\nin such SVR operations are found to be at fault in any similar incident in the future, it could result in civil and/or criminal liability\nfor us, including monetary damages or other penalties. Even if we are not found liable, we could suffer reputational harm if we are negatively\nassociated with such incidents. While we have policies and procedures in place governing the use of force by our service provider, there\ncan be no assurance that these policies and procedures, even if followed, would entirely mitigate any resulting reputational harm or\ncivil and/or criminal liability that may result from an incident.\n\n \n\n13\n\n \n\n \n\n**Our\nfinancial results are affected directly by the operating results of our licensees and their employees, over whom we do not have direct\ncontrol.**\n\n** **\n\nOur\noperations in Botswana, Malawi, Rwanda and Zimbabwe, which are conducted by independent businesses that are licensees pursuant to franchise\nagreements with us, comprised 0.1% of our revenue for the financial year ended February 28, 2026 and 0.1% of our revenue for the financial\nyear ended February 28, 2025. Our licensees generate revenue in the form of hardware and subscription revenue billed to customers. Accordingly,\nour financial results depend in part upon the operational and financial success of our licensees. We may have to terminate licensees\ndue to various reasons, including non-payment. Additionally, if licensees fail to renew their license agreements, or if we decide to\nrestructure license agreements in order to induce licensees to renew these agreements, then our revenues may decrease and profitability\nfrom new licensees may be lower than in the past due to reduced royalties and other incentives we may need to provide.\n\n \n\nWe\nrely in part on our licensees and the manner in which they operate their locations to develop and promote our business in Botswana, Malawi,\nRwanda and Zimbabwe. Although we have developed criteria to evaluate and screen prospective licensees, we cannot be certain that our\nlicensees will have the business acumen or financial resources necessary to operate successful businesses in their franchise areas and\nlocal laws may limit our ability to terminate or modify these franchise agreements. Moreover, despite our training, support and monitoring,\nlicensees may not successfully operate in a manner consistent with our standards and requirements or may not hire and train qualified\nemployees. The failure of our licensees to operate their franchises successfully could have a material adverse effect on us, our reputation,\nour brand and our ability to attract prospective licensees, which could have a material adverse effect on our business, financial condition\nor results of operations.\n\n \n\n**Our\nlicensees and their employees could take actions that could harm our business.**\n\n** **\n\nOur\nlicensees are independent businesses and the employees who work for them are not our employees, nor do we exercise control over their\nday-to-day operations. Our licensees may not operate their businesses in a manner consistent with industry standards or may not attract\nand retain qualified employees. If licensees were to provide diminished quality of service to customers, engage in fraud, misappropriation,\nmisconduct or negligence or otherwise violate the law, including with respect to any laws relating to sanctions, our brand and reputation\nmay suffer materially, and we may become subject to liability claims based upon such actions of our licensees and their employees.\n\n \n\nBrand\nvalue can be severely damaged even by isolated incidents, particularly if the incidents receive considerable negative publicity or result\nin litigation. Some of these incidents may relate to the way we manage our relationship with our licensees, our growth strategies or\nthe ordinary course of our business or our licensees’ business. Other incidents may arise from events that are, or may be, beyond\nour control and may damage our brand, such as actions taken (or not taken) by one or more licensees or their employees relating to health,\nsafety, welfare or other matters, litigation and claims, failure to maintain high ethical and social standards for all of our operations\nand activities, failure to comply with local laws and regulations and illegal activity targeted at us or others. Our brand value could\ndiminish significantly if any such incidents or other matters erode consumer confidence in us, which may result in a decrease in our\nrevenue, which in turn would materially and adversely affect our business, financial condition and results of operations.\n\n \n\n**We\ndepend on certain key suppliers and vendors as part of our hardware manufacturing process. An interruption in the supply chain could\nimpair our product availability, thereby adversely affecting distribution and growth.**\n\n** **\n\nThe\nmanufacturing of our core hardware requires advanced production planning, including the purchase of specific components and evaluation\nof component-related design elements. We currently purchase the latest Global System for Mobile Communications (“GSM”), including\nLong-Term Evolution (“LTE”), module components of our hardware, semiconductors and other passive components from certain\nthird-party suppliers, and we also source other hardware and devices from third-party suppliers that integrate into our device agnostic\noperational intelligence platform. In addition, we currently depend principally on certain third-party suppliers to supply and manufacture\ncomponents of our hardware for our PC boards and to manufacture our GSM, LTE and GNSS components. These modules and many of the other\ncomponents used in the manufacture of our devices have extended lead times on orders. We do not have contracts or volume commitments\nin place with our third-party suppliers but instead place purchase orders on a periodic as-needed basis.\n\n \n\n14\n\n \n\n \n\nWe\nhave in the past experienced, and may in the future experience, component shortages and the predictability of the availability of these\ncomponents may be limited. For example, we utilize semiconductor chips in certain of the hardware products that we manufacture. Over\nthe last several financial years, there was an ongoing global silicon component shortage, which resulted in increases in the cost of\ndevices and components and delays in shipments of goods across many industries, including components used in our Internet of Things (“IoT”)\ndevices. Although the semiconductor chip supply crisis has been largely resolved, it still carries a degree of uncertainty.\n\n \n\nSupply\nchain disruptions such as of port congestion with the challenges facing shipping routes and shippers having to explore alternative routes,\njet fuel shortages and air freight delays can impede supply chains, leading to depleted inventories and resulting in a backlog of merchandise\nstranded in transit. Increases in the cost of devices or components, or freight to transport those items, could negatively impact our\nability to fulfill engineering design changes or customer demand, each of which could adversely impact our results of operations. The\nongoing conflict in the Middle East and disruption to shipping through the Strait of Hormuz have contributed to inflationary pressures\nglobally, resulting in fuel and shipping costs increases. Shipping costs to the European Union and Africa have increased recently, and\nwe expect device product costs to also increase.\n\n \n\nWhile\nour hardware is designed such that components may be interchanged in case of supply disruptions or unavailability, any interruptions\nor delays in the supply of components could require us to identify and integrate our manufacturing logistics with an alternate supplier\nor use a substitute component. If the facilities of one of our contract manufacturers were to suffer a major business interruption event,\nit could take up to three months or longer to replace production capacity. Interruption in the supply of components from our contract\nmanufacturers could impair our production capacity, and we may not have recourse against our suppliers through contractual representations,\nwarranties, indemnification provisions or otherwise, which could have a material adverse effect on our business, results of operations\nand financial condition.\n\n \n\nThese\nsuppliers or vendors could fail to provide equipment or service on a timely basis, or fail to meet our performance expectations, for\na number of reasons, including, for example, disruption to the global supply chain as a result of geopolitical factors, effects of a\npandemic, natural disasters or the potential impacts of global climate change. The introduction of tariffs by the US presidential administration\nmay have significant ripple effects on global supply chains, requiring manufacturers and supply chain leaders to adjust sourcing strategies,\nmanage cost fluctuations, and rethink global trade dependencies. This may result in higher prices of certain components and may lead\nto growth constraints on specific product categories.\n\n \n\nAlthough\nwe have extended our supply orders in terms of lead times and have made pre-emptive purchases to build out our inventory, we cannot guarantee\nthat we will have sufficient inventory for our needs at all times. Any interruption or delay in the supply of any of these devices or\ncomponents, or the inability to obtain these devices or components from alternate sources at acceptable prices and within a reasonable\namount of time, could harm our ability to onboard new customers.\n\n \n\n**Our\noperational intelligence platform relies on specific third-party software and any inability to license or use such software from third\nparties could render our platform inoperable.**\n\n** **\n\nWe\nrely on software and other intellectual property licensed from third parties, including mapping software, business intelligence tools\nand data from third party vendors such as Google, HERE and Sisense to develop and provide solutions to our customers. In addition, we\nmay need to obtain future licenses from third parties to use software or other intellectual property associated with our solutions. We\ncannot assure you that these licenses will be available to us on acceptable terms, without significant price increases or at all. Any\nloss of the right or inability to obtain the right to use any such software or other intellectual property required for the development\nand maintenance of our solutions could result in interruptions in the provision of our solutions until equivalent technology is either\ndeveloped by us, or, if available from others, is identified, obtained, and integrated, which could harm our business.\n\n \n\n15\n\n \n\n \n\n**Our\nuse of open-source software may pose particular risks to our proprietary software and systems.**\n\n** **\n\nWe\nuse open-source software in our proprietary software and systems and intend to continue using open-source software in the future. The\nterms of many open-source licenses to which we are subject have not been interpreted by European, Singaporean, South African or U.S.\ncourts or courts of other jurisdictions, and there is a risk that those licenses could be construed in a manner that imposes unanticipated\nconditions or restrictions on our ability to commercialize our solutions. Open-source software providers may also change their open-source\nofferings to commercial products. The licenses applicable to our use of open-source software may require that source code that is developed\nusing open-source software be made available to the public and that any modifications or derivative works to certain open-source software\ncontinue to be licensed under open-source licenses. Moreover, we cannot ensure that we have not incorporated additional open-source software\nin our software in a manner that is inconsistent with the terms of the applicable license or our current or future policies and procedures.\nIn that event, we could be required to seek licenses from third parties in order to continue offering our solutions, to re-develop our\nsolutions, to discontinue sales of our solutions, or to release our proprietary software source code under the terms of an open-source\nlicense, any of which could have a material adverse effect on our business.\n\n \n\nAlthough\nwe employ open-source software license screening measures, if we were to combine our proprietary software products with open-source software\nin a certain manner we could, under certain open-source licenses, be required to release the source code of our proprietary software\nproducts. If we fail to comply with these licenses, we may be subject to certain requirements, including requirements that we offer our\nsolutions that incorporate the open-source software for no cost, that we make available source code for modifications or derivative works\nwe create based upon, incorporating or using the open-source software and that we license such modifications or derivative works under\nthe terms of applicable open-source licenses. If an author or other third party that distributes such open-source software were to allege\nthat we had not complied with the conditions of one or more of these licenses, we could be required to incur significant legal expenses\ndefending against such allegations and could be subject to significant damages, enjoined from the sale of our products that contained\nthe open-source software and required to comply with onerous conditions or restrictions on these products, which could disrupt the distribution\nand sale of these products.\n\n \n\nFrom\ntime to time, there have been claims challenging the rights in open-source software against companies that incorporate it into their\nproducts. We and our customers may face claims from third parties claiming infringement of their intellectual property rights for what\nwe believe to be permissive open-source software, or demanding the release or license of the open-source software or derivative works\nthat we developed using such software (which could include our proprietary source code) or otherwise seeking to enforce the terms of\nthe applicable open-source license. These claims could result in litigation that could be costly to defend, have a negative effect on\nour business, financial condition and results of operations, and could require us to purchase a costly license, publicly release the\naffected portions of our source code, be limited in or cease the sale or use of the implicated software unless and until we can re-engineer\nsuch software to avoid infringement or change the use of, or remove, the implicated open-source software, which could require us to devote\nadditional research and development resources, or take other remedial actions.\n\n \n\nIn\naddition to risks related to license requirements, use of certain open-source software can lead to greater risks than use of third-party\ncommercial software, as open-source licensors generally do not provide warranties, indemnities or other contractual protections with\nrespect to the software (for example, non-infringement or functionality). Some open-source projects have known vulnerabilities and architectural\ninstabilities and are provided on an “as-is” basis which, if not properly addressed, could negatively affect the performance\nof our product. Our use of open-source software may also present additional security risks because the source code for open-source software\nis publicly available, which may make it easier for hackers and other third parties to determine how to breach our website, our software\nplatform and systems that rely on open-source software.\n\n \n\nAny\nof these risks could be difficult to eliminate or manage, and, if not addressed, could have a material adverse effect on our business,\nfinancial condition, results of operations and prospects.\n\n \n\n16\n\n \n\n \n\n**Risks\nRelating to Our Growth Strategy**\n\n** **\n\n**We\nhave experienced growth in recent periods. If we fail to manage our growth effectively, we may be unable to execute our business plan,\nmaintain high levels of service or address competitive challenges adequately.**\n\n** **\n\nWe\nincreased the number of our full-time employees from 5,711 as at February 28, 2025 to 7,405 as at February 28, 2026. Our subscription\nrevenue increased from ZAR 4,068.2 million for the financial year ended February 28, 2025 to ZAR 4,843.7 million for the financial year\nended February 28, 2026 and our total subscribers increased from 2,302,236 as at February 28, 2025 to 2,662,222 as at February 28, 2026.\nOur growth has placed, and may continue to place, significant pressure on our managerial, administrative, operational, financial and\nother resources. We intend to further expand our overall business, customer base, headcount and operations. Our global organization and\nworkforce require substantial management effort to maintain. We will be required to continue to improve our operational and financial\ncontrols and reporting procedures and we may not be able to do so effectively. As such, we may be unable to manage our expenses effectively\nin the future, which may negatively impact our gross profit or operating expenses in any particular quarter.\n\n \n\n**We\nmay not effectively execute on our expansion strategy, which may adversely affect our ability to maintain our historical growth and earnings\ntrends.**\n\n** **\n\nCartrack\nhas grown rapidly over the last several years. Companies that grow rapidly can experience significant difficulties as a result. Our primary\nexpansion strategy focuses on organic growth, including increased regional market penetration. However, we may not be able to successfully\nexecute on these aspects of our expansion strategy, which may cause our future growth rate to decline below our recent historical levels,\nor may prevent us from growing at all.\n\n \n\nWhile\nwe operate in numerous jurisdictions and our software platform and local company websites are designed for ease of localizations, we\nmay find it difficult to localize our company website and software platform into certain foreign languages, and we may be required to\ninvest significant resources in order to do so in markets in which we do not yet operate. Furthermore, in addition to the expansion of\nour business into new geographical markets, we seek to develop a range of mobility and monitoring solutions in select markets. We may\nnot succeed in these efforts or achieve our customer acquisition, customer retention or other goals. In some international markets, customer\npreferences and buying behaviors may be different, and we may use business or pricing models that are different from our traditional\nsubscription model to provide our mobility data analytics solutions to customers in those markets, or we may be unsuccessful in implementing\nthe appropriate business model. Our revenue from new markets may not exceed the costs of establishing, marketing, and maintaining our\nofferings.\n\n \n\nIn\naddition, conducting expanded international operations would subject us to new risks. These risks include:\n\n \n\n \n●\nlocalization\nof our operational intelligence platform and the specific features and applications, including the addition of foreign languages\nand adaptation to new local practices and regulatory requirements;\n\n \n\n \n●\nlack\nof experience in other geographic markets;\n\n \n\n \n●\nstrong\nlocal competitors;\n\n \n\n \n●\nthe\ncost and burden of complying with, lack of familiarity with, and unexpected changes in, foreign legal and regulatory requirements,\nincluding, but not limited to, changes in international trade policy, cybersecurity and AI regulation, or labor regulations;\n\n \n\n \n●\ndifficulties\nin managing and staffing international operations;\n\n \n\n \n●\nfluctuations\nin currency exchange rates or restrictions on foreign currency;\n\n \n\n \n●\npotentially\nadverse tax consequences, including the complexities of transfer pricing, value-added or other tax systems, double taxation and restrictions\nand/or taxes on the repatriation of earnings;\n\n \n\n17\n\n \n\n \n\n \n●\ndependence\non third parties, including commercial partners with whom we do not have extensive experience;\n\n \n\n \n●\nincreased\nfinancial accounting and reporting burdens and complexities;\n\n \n\n \n●\ngeopolitical,\nsocial, and economic instability, terrorist attacks, pandemics and other natural disasters, extreme weather or climate events and\nsecurity concerns in general; and\n\n \n\n \n●\nreduced\nor varied protection for intellectual property rights in some countries.\n\n \n\nOperating\nin international markets also requires significant management attention and financial resources. The investment and additional resources\nrequired to establish operations and manage growth in other countries may not produce desired levels of revenue or profitability.\n\n \n\nVarious\nother factors, such as economic conditions and competition may impede or restrict the growth of our operations. The success of our strategy\nalso depends on our ability to manage our growth effectively, which in turn depends on a number of factors, including our ability to\nadapt our credit, operational, technology and governance infrastructure to accommodate expanded operations. Even if we are successful\nin continuing our growth, such growth may not offer the same levels of potential profitability, and we may not be successful in controlling\ncosts relative to revenue. As such, we may not be able to achieve our long-term targets for expense management and profitability. Accordingly,\nour inability to maintain growth or to effectively manage growth could have a material adverse effect on our business, financial condition\nand results of operations.\n\n \n\n**Investments\ninto our operational intelligence platform and technology infrastructure may not yield the desired results.**\n\n** **\n\nWe\nhave developed a scalable and proprietary operational intelligence platform to facilitate and integrate our business operations, data\ngathering analysis and online marketing capabilities and have invested significant capital and time into building and enhancing our operational\nintelligence platform and infrastructure. To remain competitive, we expect to continue to make significant investments in our operational\nintelligence platform. However, there is no guarantee that the capital and resources we have invested or will invest in the future will\nallow us to develop suitable operational intelligence platform enhancements or software applications or maintain and expand our operational\nintelligence platform and technology infrastructure as intended, which could have a material adverse effect on our ability to compete\nor require us to purchase expensive software solutions from third-party developers.\n\n \n\nIf\nour investments in our operational intelligence platform and technology infrastructure do not yield the desired results, it could have\na material adverse effect on our business, financial condition, results of operations and prospects.\n\n \n\n**If\nwe fail to maintain or enhance our brand recognition or reputation, our business could be harmed.**\n\n** **\n\nWe\nbelieve that maintaining, enhancing and protecting our brand and our reputation are critical to our relationships with our customers\nand to our ability to attract new customers. We also believe that our brand and reputation will be increasingly important as competition\nin our market continues to develop. Our success in this area will depend on a wide range of factors, some of which are beyond our control,\nincluding the following:\n\n \n\n \n●\nthe\nefficacy of our marketing efforts;\n\n \n\n \n●\nour\nability to continue to offer stable, high-quality, innovative and error and bug-free applications;\n\n \n\n \n●\nour\nability to retain existing customers and attract new customers;\n\n \n\n \n●\nour\nability to maintain high customer service levels and satisfaction;\n\n \n\n18\n\n \n\n \n\n \n●\ntechnology\ndevelopments that minimize demand for our solutions;\n\n \n\n \n●\nour\nability to successfully differentiate our applications from those of our competitors;\n\n \n\n \n●\nour\nability to obtain and maintain intellectual property;\n\n \n\n \n●\nactions\nof competitors and other third parties;\n\n \n\n \n●\npositive\nor negative publicity;\n\n \n\n \n●\nany\nmisuse or perceived misuse of our applications;\n\n \n\n \n●\ninterruptions,\ndelays or attacks on our platform or applications; and\n\n \n\n \n●\nlitigation,\nlegislative or regulatory-related developments.\n\n \n\nIf\nour brand promotion activities are not successful, our growth and results of operations may be harmed. Furthermore, negative publicity,\nwhether or not justified, relating to events or activities attributed to us, our employees, our partners or others associated with any\nof these parties, may tarnish our reputation and reduce the value of our brand. Damage to our reputation and loss of brand equity may\nreduce demand for our applications and could have a material adverse effect on our business, financial condition and results of operations.\nMoreover, any attempts to rebuild our reputation and restore the value of our brand may be costly and time-consuming, and such efforts\nmay not ultimately be successful.\n\n \n\n**The\nloss of one or more of our key management team members or personnel, or our failure to attract, train and retain other highly qualified\npersonnel, could harm our business.**\n\n** **\n\nWe\ndepend on the continued service and performance of our senior management team, including our founder and Chief Executive Officer, Isaias\n(Zak) Jose Calisto. In addition, the sales, customer service-driven and research and development focus of our business is vital to our\ngrowth plan and the loss of key personnel could disrupt our operations. To execute our growth plan, we must attract and retain highly\nqualified employees. Competition for these employees is intense, and we may not be successful in attracting and retaining qualified employees\nwith appropriate skills. This is particularly the case in Southeast Asia where there is increased competition for qualified employees\nwith the appropriate language skills. In addition, new hires require significant training and, in most cases, take significant time before\nthey achieve full productivity. Our recent and planned hires may not become as productive as we expect, and we may be unable to hire\nor retain sufficient numbers of qualified employees. If we fail to attract, hire and train new employees, or fail to retain, focus and\nmotivate our current employees, it could have a material adverse effect on our business and growth prospects.\n\n \n\n**Our\ncorporate culture has contributed to our success, and if we cannot maintain this culture, we could lose the innovation, creativity and\nteamwork fostered by our culture, which could harm our business.**\n\n** **\n\nWe\nbelieve that our vertically integrated and customer-centric corporate culture is key to our success, which we believe fosters innovation,\ncreativity and teamwork among our employees. As we continue to grow, we may encounter difficulties in maintaining or adapting our culture\nto sufficiently meet the needs of our future and evolving operations, and we must be able to effectively integrate, develop and motivate\na growing number of employees. In addition, our ability to maintain our culture as a publicly listed company in the United States, with\nthe attendant changes in policies, practices, corporate governance and management requirements may be challenging. Any failure to preserve\nour culture, particularly if we are unable to preserve our culture across the various markets in which we operate, could also negatively\naffect our ability to retain and recruit employees, maintain our performance or execute on our business strategy, which could have a\nmaterial adverse effect on our business, financial condition, results of operations and prospects.\n\n \n\n19\n\n \n\n \n\n**We\nmay expand by acquiring or investing in other companies, which may divert our management’s attention, result in dilution to our\nshareholders, and consume resources that are necessary to sustain our business.**\n\n** **\n\nWe\nmay in the future acquire complementary platforms, solutions, technologies, or businesses. We also may enter into relationships with\nother businesses to expand our portfolio of solutions or our ability to provide our solutions in foreign jurisdictions. Negotiating these\ntransactions can be time-consuming, difficult and expensive, and our ability to complete these transactions may often be subject to conditions\nor approvals that are beyond our control. Consequently, these transactions, even if undertaken and announced, may not close.\n\n \n\nAn\nacquisition, investment, joint venture, alliance or new business relationship may result in unforeseen operating difficulties and expenditures.\nIn particular, we may encounter difficulties assimilating or integrating the businesses, technologies, solutions, employees, or operations\nof acquired companies, particularly if the key employees of the acquired company choose not to work for us, or display a conflicting\ncorporate culture or work ethic, the acquired company’s technology is not easily adapted to be compatible with ours, or we have\ndifficulty retaining the customers of any acquired business due to changes in management or otherwise. Acquisitions may also disrupt\nour business, divert our resources, and require significant management attention that would otherwise be available for the development\nof our business. Moreover, the anticipated benefits of any acquisition, investment, or business relationship may not be realized or we\nmay be exposed to unknown liabilities, including litigation against the companies we may acquire. For one or more of those transactions,\nwe may:\n\n \n\n \n●\nissue\nadditional equity securities that would dilute our shareholders;\n\n \n\n \n●\nuse\ncash that we may need in the future to operate our business;\n\n \n\n \n●\nlose\nkey employees of any acquired business;\n\n \n\n \n●\nface\nchallenges in successfully integrating, operating and managing acquired businesses and workforce and instilling our culture and work\nethic into new management and employees;\n\n \n\n \n●\nincur\ndebt on terms unfavorable to us or that we are unable to repay or that may place burdensome restrictions on our operations;\n\n \n\n \n●\nincur\nlarge charges or substantial liabilities; or\n\n \n\n \n●\nbecome\nsubject to adverse tax consequences, or substantial depreciation, deferred compensation or other acquisition-related accounting charges.\n\n \n\nAny\nof these risks could harm our business and results of operations.\n\n \n\n**We\nhave entered, and expect to continue to enter, into collaboration agreements or partnerships and these activities involve risks and uncertainties.**\n\n** **\n\nWe\nhave entered, and expect to continue to enter, into collaboration agreements with local partners to the extent required pursuant to local\nlaws and regulations in order to penetrate certain geographic regions to effectively grow our business. Entering into collaborations\nor partnerships involves risks and uncertainties, including the risk that a given partner could fail to satisfy its obligations, which\nmay result in certain liabilities to us for guarantees and other commitments. Further, since we may not exercise control over our current\nor future partners, we may not be able to require our partners to take the actions that we believe are necessary to implement our business\nstrategy. Additionally, differences in views among partners may result in delayed decision-making or failure to agree on major issues.\nIf any of these difficulties cause any of our partners to deviate from our business strategy, or if this leads any of our collaborations\nor partnerships to fail to attract the intended customer base, it could have a material adverse effect on our results of operations.\n\n \n\n20\n\n \n\n \n\n**Risks\nRelating to Our Intellectual Property, Data Privacy and Cybersecurity**\n\n** **\n\n**Evolving\nregulation and changes in applicable laws relating to the Internet and data privacy may increase our expenditure related to compliance\nefforts or otherwise limit the solutions we can offer, which may harm our business and adversely affect our financial condition.**\n\n** **\n\nThe\ntransmission of data over the Internet and cellular networks is a critical component of our operational intelligence and subscription\nmodel. As Internet commerce continues to evolve, increased regulation by federal, state or foreign agencies becomes more likely, particularly\nin the areas of data privacy, and data security. We are subject to this complex and evolving patchwork of data privacy and data security\nlaws and regulations in the jurisdictions in which we operate. These laws and regulations impose numerous obligations on our business,\nincluding those relating to the collection, use, disclosure, transfer, destruction and security of personal information. The requirements\nunder these laws are often complex, vary by jurisdiction and can be subject to unclear or conflicting interpretations. These laws may\nalso carry significant penalties for non-compliance, including substantial fines and private litigation. Despite our efforts to comply\nwith these obligations, our products, services and operations may not fully comply with all applicable laws and regulations at all times.\nIn addition, taxation of services provided over the Internet or other charges imposed by government agencies or by private organizations\nfor accessing the Internet may be imposed. Any regulation imposing greater fees for Internet use or restricting information exchange\nover the Internet could result in a decline in the profitability and viability of Internet-based services, which could harm our business.\n\n \n\nOur\nsolutions enable us to collect, manage and store a wide range of data related to fleet management, vehicle location and tracking and\nother telematics services such as fuel usage, engine temperature, speed and mileage and, in the case of our field service application,\nincludes customer information, job data, schedule and invoice information. A valuable component of our solutions is our ability to analyze\nthis data and present the user with actionable business intelligence, including AI-powered decision-making tools. We expect AI to play\nan increasingly important role in our future product and service offerings. As with many developing technologies, AI presents risks and\nchallenges that could affect its further development, adoption, and use, and therefore our business. The use of AI technologies could\nlead to the unauthorized disclosure of sensitive, proprietary, or confidential information and could lead to new potential cyberattack\nmethods or increase the frequency or intensity of such attacks. We obtain our data from a variety of sources, including our customers\nand third-party sources or service providers. We cannot assure you that the data we require for our proprietary data sets will be available\nfrom these sources in the future or that the cost of such data will not increase. The United States and various state governments have\nadopted or proposed limitations on the collection, distribution and use of personal information. Several foreign jurisdictions, including\nSouth Africa, Singapore and the European Union, have adopted legislation (including directives or regulations) that increase or change\nthe requirements governing data collection and storage in these jurisdictions. Further, such data privacy laws and regulations may be\namended in the future. Any failure to adhere to or successfully implement processes in response to changing regulatory requirements in\nthis area could result in legal liability or impairment to our reputation in the marketplace, which could have a material adverse effect\non our business, financial condition, results of operations and prospects.\n\n \n\nThe\ncurrent European Union legislation related to data protection is the General Data Protection Regulation (“GDPR”). While we\nappointed a Data Protection Officer to oversee and supervise our compliance with European data protection regulations and have taken\nsteps to mitigate the risks of GDPR, we cannot provide any assurance that we are in compliance with all aspects of European data protection\nregulations, including GDPR. Despite our ongoing efforts to bring practices into compliance, we may not be successful either due to various\nfactors within our control, such as limited financial or human resources, or other factors outside of our control. For example, while\nwe seek to enter into data processing agreements with third-parties with whom we share data, or who share data with us, we may be unable\nto execute agreements with all such third-parties. It is also possible that local data protection authorities may have different interpretations\nof the GDPR, leading to potential inconsistencies amongst various EU member states. The Artificial Intelligence Act of the European Union,\nalso known as the EU AI Act or the AI Act came into force on August 1, 2024, with different provisions of the law going into effect in\ndifferent stages in 2025.\n\n \n\n21\n\n \n\n \n\nIn\nSingapore, the Personal Data Protection Act 2012, No. 26 of 2012 generally requires organizations to give notice and obtain consents\nprior to collection, use or disclosure of personal data (data, whether true or not, about an individual who can be identified from that\ndata or other accessible information). The Protection of Personal Information Act, No. 4 of 2013 (the “POPI Act”) applies\nto our South African subsidiaries.\n\n \n\nIn\n2023, China issued its Interim Measures for the Administration of Generative Artificial Intelligence Services. Under the law, the provision\nand use of generative AI services must “respect the legitimate rights and interests of others” and are required to “not\nendanger the physical and mental health of others, and do not infringe upon others’ portrait rights, reputation rights, honor rights,\nprivacy rights, and personal information rights”.\n\n \n\nWe\nhave updated and will continue to evaluate our Group data protection and security policies, charters, and procedures to assist in maintaining\ndata privacy and data security in line with international practices. If our privacy or data security measures fail to comply, or are\nperceived to fail to comply, with current or future laws and regulations, we may be subject to litigation, regulatory investigations\nor other liabilities.\n\n \n\nMoreover,\nif future laws and regulations limit our customers’ ability to use and share this data or our ability to store, process and share\ndata with our clients over the Internet, demand for our solution could decrease, our costs could increase, and our results of operations\nand financial condition could be harmed.\n\n \n\nU.S.\ntreatment of data protection is accomplished by legislation at the federal level within sector-specific contexts and so definitions of\nwhat kinds of data are covered will vary from one law to the next. In recent years, a proliferation of comprehensive state data privacy\nlaws was enacted in several jurisdictions in the US, in addition to those already in effect. Furthermore, as regulations continue to\ndevelop, enforcement actions may increase. As such, businesses are required to allocate adequate resources to ensure compliance with\ndata privacy laws.\n\n \n\nIn\naddition, AI has seen significant expansion in terms of technology, adoption, proposed regulation and enforcement. In 2022, the White\nHouse Office of Science and Technology Policy (OSTP) released its “Blueprint for an AI Bill of Rights.” This nonbinding framework\ndelineates five principles to guide the development of AI, including a section dedicated to data privacy, encouraging AI professionals\nto seek individuals’ consent on data use. The expansion of AI policies and regulation, particularly at the U.S. state level, is\npossible.\n\n \n\nOn\nthe U.S. federal level, despite the American Data Privacy and Protection Act in 2022, there has not been significant advancement toward\nan omnibus privacy law.\n\n \n\nThe\nOECD’s *Recommendation on Artificial Intelligence*—adopted in 2019 and updated in 2023 and 2024—is the first\nintergovernmental standard promoting trustworthy AI. It establishes five principles for responsible AI development and five recommendations\nfor national and international action. These principles aim to ensure AI systems are human-centric, trustworthy, and aligned with democratic\nvalues and human rights. Given our global presence, we continue to explore the adoption of group policies that would afford us compliance\nwith similar legislation in the countries we operate in.\n\n \n\nWe\nalso operate an insurance agency and brokerage business that markets short-term insurance policies and selected insurance-related value-add\nvehicle products to our customers. This results in us receiving personally identifiable information with the customer’s consent.\nThis information is increasingly subject to legislation and regulation. This legislation and regulation are generally intended to protect\nindividual privacy and the privacy and security of personal information. We could be adversely affected if government regulations require\nus to significantly change our business practices with respect to this type of information or if the insurance providers who use our\nmarketplace violate applicable laws and regulations.\n\n \n\n22\n\n \n\n \n\nChanges\nin applicable laws and regulations may materially increase our direct and indirect compliance and other expenses of doing business, having\na material adverse effect on our business, financial condition and results of operations. If there were to be changes to statutory or\nregulatory requirements, we may be unable to comply fully with or maintain all required licenses and approvals. Regulatory authorities\nhave relatively broad discretion to grant, renew and revoke licenses and approvals. If we do not have all requisite licenses and approvals,\nor do not comply with applicable statutory and regulatory requirements, the regulatory authorities could preclude or temporarily suspend\nus from carrying on some or all of our activities or institute financial penalties on us, which could have a material adverse effect\non our business, results of operations and financial condition.\n\n \n\nWe\ncannot predict whether any proposed legislation or regulatory changes will be adopted, or what impact, if any, such proposals or, if\nenacted, such laws could have on our business, results of operations and financial condition. If we fail to comply with applicable laws\nand regulations, we may be subject to investigations, criminal penalties or civil remedies, including fines, injunctions, loss of an\noperating license or approval, increased scrutiny or oversight by regulatory authorities, the suspension of individual employees, limitations\non engaging in a particular business or redress to customers. The cost of compliance and the consequences of non-compliance could have\na material adverse effect on our business, results of operations and financial condition. In addition, a failure to comply with applicable\nlaws and regulations could have a material adverse effect on our business, results of operations and financial condition by exposing\nus to negative publicity and reputational damage or by harming our customer or employee relationships.\n\n \n\nIn\nmost jurisdictions, government regulatory authorities have the power to interpret and amend applicable laws and regulations, and have\ndiscretion to grant, renew and revoke the various licenses and approvals we need to conduct our activities. Such authorities may require\nus to incur substantial costs in order to comply with such laws and regulations. Regulatory statutes are broad in scope and subject to\ndiffering interpretation. In some areas of our businesses, we act on our own or the industry’s interpretations of applicable laws\nor regulations, which may differ by jurisdiction. In the event those interpretations are different from the interpretations of regulatory\nauthorities, we may be penalized or precluded from carrying on our previous activities.\n\n \n\n**Our\noperational intelligence platform may contain undetected defects or software errors, which could result in damage to our reputation,\nmarket rejection of our products, or adversely affect our business, financial condition and results of operations.**\n\n** **\n\nOur\ncontinued growth depends in part on the ability of our existing and potential customers to access our solutions and platform capabilities\nat any time and within an acceptable period of time. We have experienced, and may in the future experience, disruptions, outages, and\nother performance problems due to a variety of factors, including infrastructure changes, introductions of new functionality, human or\nsoftware errors, capacity constraints due to an overwhelming number of users accessing our platform simultaneously, denial of service\nattacks, or other security-related incidents. We must update our operational intelligence platform rapidly to keep pace with the evolving\nmarket including the third-party software and devices with which our solutions integrate, and we have a history of frequently introducing\nnew versions. Our solutions could contain undetected errors or defects, especially when first introduced or when new versions are released\nthat are difficult to detect and correct despite third-party testing. Our solutions, including software, may not be free from errors\nor defects, which could result in damage to our reputation or a material adverse effect on our results of operations.\n\n \n\nIt\nmay become increasingly difficult to maintain and improve our performance, especially during peak usage times and as our solutions and\nplatform capabilities become more complex and our user traffic increases. If our platform is unavailable or if our users are unable to\naccess our solutions and platform capabilities within a reasonable amount of time or at all, we may experience a loss of customers, lost\nor delayed market acceptance of our platform and solutions, delays in payment to us by customers, harm to our reputation and brand, legal\nclaims against us, and the diversion of our resources. In addition, to the extent that we do not effectively address capacity constraints,\nupgrade our systems as needed and continually develop our technology and network architecture to accommodate actual and anticipated changes\nin technology, our business, financial condition and results of operations may be adversely affected.\n\n \n\n23\n\n \n\n \n\nThe\noperation of our hardware is controlled by the firmware loaded on the hardware. We generally provide firmware updates to our customers\nby “over-the-air” wireless communication directly to our customers’ telematics devices. If the firmware does not function\nas expected and prevents the uploading of updated firmware, it would require direct servicing of the installed on-board computer by trained\nemployees resulting in significant costs. Variations among communications protocols in the markets in which we operate enhance the risk\nof error in the remote installation of firmware. Although we attempt to manage this risk by introducing firmware updates in stages so\nthat the success of deployment to a small number of telematics devices can be assessed before the installment risk is expanded to a larger\ncustomer base, there can be no assurance that we will be successful in detecting firmware operation and integration problems or otherwise\nin managing our exposure to remediation expense related to the deployment of firmware updates.\n\n \n\n**Our\nuse of AI and generative AI tools presents risks and challenges that could adversely affect our business and require that we incur substantial\ncosts**\n\n** **\n\nWe\nuse AI and generative AI tools in certain of our products, services and operations, including customer service, data analytics, product\ndevelopment and code creation. AI is a rapidly evolving and disruptive technology and the long-term implications of its use are still\nuncertain. We expect that the increasing adoption and use of AI technologies will continue to accelerate and have significant impacts\non our business and the industries we serve. Our competitors may incorporate AI more quickly or successfully and our solutions could\nbecome less competitive as a result. AI-related laws and regulations in the U.S., EU and a variety of other countries and jurisdictions\nare rapidly evolving and are subject to significant uncertainty and could impose significant compliance costs, restrict certain AI applications,\nor require us to alter our AI-related practices.\n\n \n\nAI\nmay also produce erroneous or misleading content and outputs that infringe on the intellectual property or data privacy rights of others.\nAlthough we take measures to address the accuracy and appropriate use of generative AI content, including through internal policies and\ntraining, these efforts may not always be successful. Any failure by our personnel, contractors, or partners to adhere to our policies,\nor otherwise use AI in an inappropriate manner, could result in violations of confidentiality obligations and laws or regulations, jeopardize\nour IP rights, or expose our products or business systems to defects and malware, any of which could damage our business and result in\nreputational, technical, or competitive harm.\n\n \n\n**Our\n“over-the-air” transmission of firmware updates could permit a third party to disable our customers’ telematics devices\nor introduce malware into our customers’ telematics devices, which could expose us to customer claims.**\n\n** **\n\n“Over-the-air”\ntransmission of our firmware updates potentially provides the opportunity for a third party to modify or disable our customers’\noperating systems or introduce malware into our customers’ operating systems. While no such incidents have occurred to date, there\ncan be no assurance that they will not occur in the future. For example, a third party could attempt to introduce software modifications\nproviding incorrect location data and functionality or the deletion of data. Damage to our customers’ telematics devices as a result\nof such incidents could only be remedied through direct servicing of their installed telematics devices by trained employees resulting\nin significant costs, particularly if the incidents were to be widespread. Moreover, such incidents could expose us to various claims\nby our customers, the outcome of which would be uncertain. Third party interference with our over-the-air transmission of firmware or\nwith our customers’ telematics devices during such processes could have a material adverse effect our business, financial condition\nand results of operations.\n\n \n\n**Any\nsignificant disruption in service on our operational intelligence platform or in our computer systems, through cybersecurity breaches,\ncomputer viruses or otherwise or disruption of our platform, including as a result of artificial intelligence, could damage our reputation\nand result in a loss of customers, which would harm our business and results of operations.**\n\n** **\n\nOur\nbrand, reputation, and ability to attract, retain, and serve our customers are dependent upon the reliable performance of our service\nand our customers’ ability to access our solutions at all times. Our customers rely on our solutions to make operating decisions\nrelated to their fleet, as well as to measure, store and analyze valuable data regarding their businesses. Our solutions are vulnerable\nto interruption and our data centers are vulnerable to damage or interruption from human error, intentional bad acts, computer viruses\nor hackers, earthquakes, hurricanes, floods, fires, war, terrorist attacks, power losses, hardware failures, systems failures, telecommunications\nfailures, and similar events, any of which could limit our customers’ ability to access our solutions. Prolonged delays or unforeseen\ndifficulties in connection with adding capacity or upgrading our network architecture may cause our service quality to suffer. Any event\nthat significantly disrupts our service or exposes our data to misuse could damage our reputation and harm our business and results of\noperations, including reducing our revenue, causing us to issue credits to customers, subjecting us to potential liability, increasing\nour churn rates, or increasing our cost of acquiring new customers.\n\n \n\n24\n\n \n\n \n\nWe\nhost our solutions and serve our customers from our network servers, which are principally located at third-party data center facilities\nin South Africa, Singapore, the Netherlands, United Arab Emirates and France. While we control and have access to our servers and all\nof the components of our network that are located in our external data centers, we do not control the operation of these facilities.\nProblems faced by our third-party data centers with the telecommunications network providers with whom we or they contract, or with the\nsystems by which our telecommunications providers allocate capacity among their customers, including us, could adversely affect the experience\nof our customers. Our third-party data center operators could decide to close their facilities without adequate notice. In addition,\nany financial difficulties, such as bankruptcy, faced by our third-party data center operators or any of the service providers with whom\nwe or they contract may have negative effects on our business, the nature and extent of which are difficult to predict. Our disaster\nrecovery systems are located at third-party hosting facilities. While we are increasing our back-up capability, our systems have not\nbeen tested under actual disaster conditions and may not have sufficient capacity to recover all data and services in the event of an\noutage. In the event of a disaster in which our disaster recovery systems are irreparably damaged or destroyed, we could experience interruptions\nin access to our solutions. Any changes in third-party service levels at our data centers or any errors, defects, disruptions, or other\nperformance problems with our solutions could harm our reputation and may damage our data. Interruptions in our services might reduce\nour revenue, cause us to issue credits or refunds to customers, subject us to potential liability, or harm our customer retention rate.\nCompliance with the various data protection laws across nations is challenging due to the complex and sometimes contradictory nature\nof the different regulatory regimes. Because data protection regulations are not uniform among the various nations in which we operate,\nour ability to transmit consumer information across borders is limited by our ability to comply with conditions and restrictions that\nvary from country to country. In countries with particularly strict data protection laws, we might not be able to transmit data out of\nthe country at all and may be required to host individual servers in each such country where we collect data.\n\n \n\nWe\nhave experienced, and may experience in the future, disruptions, outages, and other performance problems due to a variety of factors,\nincluding infrastructure changes, introductions of new functionality, human or software errors, capacity constraints due to an overwhelming\nnumber of users accessing our solutions and platform capabilities simultaneously, denial of service attacks, or other security-related\nincidents. It may become increasingly difficult to maintain and improve our performance, especially during peak usage times and as our\nsolutions and platform capabilities become more complex and our user traffic increases. If our solutions and platform capabilities are\nunavailable or if our users are unable to access our solutions and platform capabilities within a reasonable amount of time or at all,\nwe may experience a loss of customers, lost or delayed market acceptance of our platform and solutions, delays in payment to us by customers,\nharm to our reputation and brand, legal claims against us, and the diversion of our resources. The systems we rely upon also remain vulnerable\nto damage or interruption from a number of other factors, including access to the internet, the failure of our network or software systems,\nor significant variability in visitor traffic on our product websites, earthquakes, floods, fires, power loss, telecommunication failures,\ncomputer viruses, human error and similar events or disruptions. Some of our systems are not fully redundant and our disaster recovery\nplanning is not sufficient for all eventualities. Our systems are also subject to intentional acts of vandalism. Despite any precautions\nwe may take, the occurrence of a natural disaster, a decision by any of our third-party hosting providers to close a facility we use\nwithout adequate notice for financial or other reasons, or other unanticipated problems at our hosting facilities could cause system\ninterruptions and delays, and result in loss of critical data and lengthy interruptions in our services.\n\n \n\nIn\naddition, to the extent that we do not effectively address capacity constraints, upgrade our systems as needed and continually develop\nour technology and network architecture to accommodate actual and anticipated changes in technology, our business, financial condition\nand results of operations may be adversely affected.\n\n \n\nCybersecurity\nincidents are increasing in frequency and evolving in nature and include, but are not limited to, installation of malicious software,\nunauthorized access to data and other electronic security breaches that could lead to disruptions in systems, unauthorized release of\nconfidential or otherwise protected information and the corruption of data. Given the unpredictability of the timing, nature and scope\nof information technology disruptions, there can be no assurance that the procedures and controls we employ will be sufficient to prevent\nsecurity breaches from occurring and we could be subject to manipulation or improper use of our systems and networks or financial losses\nfrom remedial actions, any of which could have a material adverse effect on our business, financial condition, results of operations\nand prospects.\n\n \n\n25\n\n \n\n \n\n**Security\nor privacy breaches in our electronic transactions or data may expose us to additional liability or result in a loss of customers, either\nof which events could harm our business.**\n\n \n\nUse\nof our solutions involve the storage, transmission and processing of our customers’ proprietary data, including potentially personal\nor identifying information. We may experience data security breaches or unauthorized disclosures of personal, confidential or proprietary\ninformation. Any inability on our part to protect the information security of our operational intelligence platform or the privacy of\nconfidential information could have a material adverse effect on our profitability by exposing us to additional liability, increasing\nour expenses relating to resolution of these breaches and deterring users from using our solutions. Further, unauthorized access to,\nor security breaches of, our solutions could result in the loss, compromise or corruption of data, loss of business, severe reputational\ndamage adversely affecting customer or investor confidence, regulatory investigations and orders, litigation, indemnity obligations,\ndamages for contract breach, penalties for violation of applicable laws or regulations, significant costs for remediation and other liabilities.\nFor example, under the GDPR, substantial penalties for failure to comply with the regulations can be imposed, including a fine of up\nto €20 million or up to 4% of the annual worldwide turnover, whichever is greater. We have incurred and expect to incur significant\nexpenses to prevent security breaches and achieve compliance with all applicable laws and regulations including the GDPR, such as deploying\nadditional employees and protection technologies, training employees, and engaging third-party experts and consultants. Our errors and\nomissions insurance coverage mitigating certain security and privacy damages and claim expenses may not be sufficient to compensate for\nall liabilities we may incur.\n\n \n\nIn\naddition, our and our third-party vendors’ systems, operations and information technology systems are vulnerable to damage or interruption\nfrom human error, physical break-ins, unauthorized access, hacking, malware, ransomware, denial of service attacks, spurious spam attacks,\nintentional acts of vandalism and similar events. The availability and use of AI-enabled technologies also increase the sophistication\nand threat posed to information technology systems. We cannot guarantee that our current security methods and measures will effectively\ncounter evolving security risks, prevent future slowdowns or disruptions, protect against extraordinary attacks while addressing the\nsecurity and privacy requirements of existing and future users. Any physical or electronic break-in or other security breach or compromise\nof the information handled by us or our service providers may jeopardize the security or integrity of information in our computer systems\nand networks or those of our customers and cause significant interruptions in our and our customers’ operations. Although we have\ndeveloped systems and processes that are designed to protect customer information and prevent data loss and other security breaches,\nincluding systems and processes designed to reduce the impact of a security breach at a third-party vendor, such measures cannot provide\nabsolute security. It is also possible that, despite existing safeguards, our employees could misappropriate our customers’ proprietary\ninformation or data, exposing us to a risk of loss or litigation and possible liability. Customers and other end-users who rely on our\nsolutions for applications that are integral to their businesses may have a greater sensitivity to security vulnerabilities than customers\nfor software solutions generally. Any such access, breach, or other loss of information could result in legal claims or proceedings,\nliability under applicable federal or state laws and regulatory penalties. Under certain applicable law, notice of breaches must be made\nto affected individuals, and for extensive breaches, notice may need to be made to the media or state attorneys general. Such a notice\ncould harm our reputation and our ability to compete. Unauthorized access, loss, or dissemination could also damage our reputation or\ndisrupt our operations, including our ability to conduct our analyses, deliver results, provide customer assistance, conduct research\nand development activities, collect, process, and prepare company financial information, and manage the administrative aspects of our\nbusiness. Further, any system failures, slowdowns or disruptions will likely result in unanticipated disruptions in service to our users,\ndecreased levels of user satisfaction and significant negative effects on our reputation, which could have a material adverse effect\non our business.\n\n \n\nWe\nrely on third-party encryption and authentication technology to provide secure transmission of confidential information over the Internet,\nincluding customer bank account numbers. Advances in technological capabilities, new discoveries in the field of cryptography or other\nevents or developments could result in a compromise or breach of the technology we use to protect sensitive transaction data. If we are\nunable to detect and prevent unauthorized use of bank account numbers, our business could suffer. If any such compromise of our security,\nor the security of our customers, were to occur, it could result in misappropriation of proprietary information or interruptions in operations\nand have a material adverse effect on our reputation or the reputation of our customers.\n\n \n\n26\n\n \n\n \n\n**If\nour operational intelligence platform does not comply with quality standards set forth under our subscription agreements or we breach\nour obligations under our subscription agreements, our subscribers may assert claims for reduced payments or seek damages from us.**\n\n** **\n\nUnder\nour subscription contracts, we typically provide certain representations and warranties to our subscribers, including, among others,\nthat we have not knowingly incorporated any intellectual property which infringes the rights of any third-party, the software being delivered\nhas been developed as per the specifications provided and is free from any patent defects and services will be provided with reasonable\ncare.\n\n \n\nIn\nthe case of any breach of these representations and warranties, we would be required to take certain remedial steps, including: modifying\nthe solution, defending our subscribers in any litigation arising from an intellectual property rights infringement claim by a third-party,\nproviding functionally equivalent replacements to the subscribers, rectifying the defect and indemnifying our subscribers for any direct\nlosses arising from such a breach of representations and warranties.\n\n \n\nSuch\nsteps may involve significant monetary costs and management time. Any inability to predict our performance and measure our productivity\nwould further compound these risks and expose us to additional liabilities. Our subscribers could seek significant compensation from\nus for the losses they suffer. Although our subscription agreements typically contain provisions designed to limit our exposure to product\nliability claims, existing or future laws or unfavorable judicial decisions could negate these limitations. Even if not successful, a\nproduct liability claim brought against us would likely be time-consuming, costly and could seriously damage our reputation in the marketplace,\nmaking it harder for us to sell our solutions.\n\n \n\n**An\nassertion by a third party that we are infringing on its intellectual property could subject us to costly and time-consuming litigation\nor expensive licenses and our business could be harmed.**\n\n** **\n\nThe\nindustries in which we operate are characterized by the existence of entities, including leading companies, competitors, patent holding\ncompanies and non-practicing entities that hold a large number of patents, copyrights, trademarks and trade secrets. Further, the industries\nare characterized by frequent litigation based on allegations of infringement or other violations of intellectual property rights. Such\nentities may assert patent, copyright, trademark or other intellectual property claims against us, our customers and partners, and those\nfrom whom we license technology and intellectual property. Much of this litigation involves patent holding companies or other adverse\npatent owners who have no relevant product revenues of their own. We do not have a patent portfolio of our own and even if we did, a\npatent portfolio may provide little or no deterrence to such patent holding companies or non-practicing entities.\n\n \n\nLegal\nproceedings involving intellectual property rights are highly uncertain and can involve complex legal and scientific questions. We cannot\nassure you that we will prevail in any current or future intellectual property infringement or other litigation given the complex technical\nissues and inherent uncertainties in such litigation. Defending such claims, regardless of their merit, could be time-consuming and distracting\nto management, result in costly litigation or settlement, cause development delays, or require us to enter into royalty or licensing\nagreements. Insurance may not cover or be insufficient for any such claim. In addition, we could be obligated to indemnify our customers\nagainst third parties’ claims of intellectual property infringement based on our solutions. If our solutions violate any third-party\nintellectual property rights, we could be required to withdraw those solutions from the market, re-develop those solutions or seek to\nobtain licenses from third parties, which might not be available on reasonable terms or at all. Any efforts to re-develop our solutions,\nobtain licenses from third parties on favorable terms or license a substitute technology might not be successful and, in any case, might\nsubstantially increase our costs and harm our business, financial condition and results of operations. Withdrawal of any of our solutions\nfrom the market could also harm our business, financial condition and results of operations. Further, we may not have the ability to\nterminate or amend our supplier contracts in connection with such solutions being withdrawn from the market, nor may we have recourse\nthrough representations, warranties, indemnification provisions or otherwise in such supplier contracts.\n\n \n\nIn\naddition, we incorporate open-source software into our platform. Given the nature of open-source software, third parties might assert\ncopyright and other intellectual property infringement claims against us based on our use of certain open-source software programs, particularly\nin the United States. The terms of many open-source licenses to which we are subject have not been interpreted by U.S. courts or courts\nof other jurisdictions, and there is a risk that those licenses could be construed in a manner that imposes unanticipated conditions\nor restrictions on our ability to commercialize our solutions. In that event, we could be required to seek licenses from third parties\nin order to continue offering our solutions, to re-develop our solutions, to discontinue sales of our solutions, or to release our proprietary\nsoftware source code under the terms of an open-source license, any of which could have a material adverse effect on our business.\n\n \n\n27\n\n \n\n \n\n**If\nwe are unable to protect our intellectual property and proprietary technologies, our business may be adversely affected.**\n\n** **\n\nOur\nfuture success and competitive position depend in large part on our ability to protect our intellectual property and proprietary technologies.\nWe rely on a combination of trademark, copyright, and trade secret laws, as well as confidentiality procedures and contractual restrictions,\nto establish and protect our intellectual property rights, all of which provide only limited protection and may not currently or in the\nfuture provide us with a competitive advantage.\n\n \n\nWe\nenter into confidentiality agreements with our employees, independent contractors and other individual advisors and enter into confidentiality\nagreements with licensees and other third parties, including suppliers and partners. We have not entered into invention assignment agreements\nwith licensees and third parties. However, we cannot guarantee that we have entered into such agreements with each party that has or\nmay have had access to our proprietary information, know-how and trade secrets. Moreover, no assurances can be given that these agreements\neffectively prevent access to, distribution, use, misuse, misappropriation, reverse engineering or disclosure of confidential or proprietary\ninformation. Further, these agreements may not provide adequate remedy in the event of unauthorized disclosure of confidential or proprietary\ninformation. In addition, others may independently discover our trade secrets or develop similar technologies and processes, and, in\neither event we would not be able to assert trade secret rights.\n\n \n\nWe\nalso rely to a limited extent on trademark and copyright law. We have no patents or patent applications. We cannot make any assurances\nthat any future trademark registrations will be issued for pending or future applications or that any registered trademarks will be enforceable\nor provide adequate protection of our proprietary rights. Intellectual property rights protection is territorial in nature and therefore,\nsuccessfully obtaining intellectual property rights protection in one jurisdiction may not necessarily provide protection in another\njurisdiction. For example, while we have obtained certain registered trademarks in South Africa, Namibia, Nigeria and Tanzania, we have\nnot obtained registered trademarks in all of the jurisdictions in which we operate or plan to operate. Accordingly, we rely primarily\non common law or unregistered rights in such jurisdictions, which may not provide the same scope of protection as registered trademarks\nand may be insufficient for our business. In addition, third-parties have filed, and may in the future file, for registration of trademarks\nsimilar or identical to our trademarks, thereby impeding our ability to build brand identity and possibly leading to market confusion.\nIn addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or\ntrademarks that incorporate variations of our registered or unregistered trademarks or trade names.\n\n \n\nWe\ncannot guarantee that any patents or trademarks will issue from any future patent or trademark applications, that any patents or trademarks\nthat issue from such applications will give us the protection that we seek, or that any such patents or trademarks will not be challenged,\ninvalidated, or circumvented. Any patents or trademarks that may be issued in the future from future patent and trademark applications\nmay not provide sufficiently broad protection and may not be enforceable in actions against alleged infringers.\n\n \n\nEven\nupon intellectual property rights registration, there is no certainty that our intellectual property rights will provide us with substantial\nprotection or commercial benefit. Despite our efforts to protect our intellectual property, some of our innovations may not be protectable,\nand our intellectual property rights may offer insufficient protection from competition or unauthorized use, lapse or expire, be challenged,\nnarrowed, invalidated, or misappropriated by third parties, or be deemed unenforceable or abandoned, which, could have a material adverse\neffect on our business, financial condition, results of operations and prospects and the legal remedies available to us may not adequately\ncompensate us.\n\n \n\n28\n\n \n\n \n\nWe\ncannot guarantee that the steps we take will be adequate to protect our technologies and intellectual property, that any patent and trademark\napplications will lead to issued patents or registered trademarks, that others will not develop or patent similar or superior technologies\nor solutions, or that our trademarks and other intellectual property will not be challenged, invalidated, or circumvented by others.\nFurthermore, effective patent, trademark, copyright, and trade secret protection may not be available in every country in which our solutions\nare available or where we have employees or independent contractors. In addition, the legal standards relating to the validity, enforceability,\nand scope of protection of intellectual property rights in Internet-related industries are uncertain and still evolving. The steps we\nhave taken and will take may not prevent unauthorized use, reverse engineering, or misappropriation of our technologies and we may not\nbe able to detect any of the foregoing. Defending and enforcing our intellectual property rights may result in litigation, which can\nbe costly and divert management attention and resources. Any such litigation may not be successful even if such rights have been infringed\nand an adverse decision could limit the scope of such rights. If our efforts to protect our technologies and intellectual property are\ninadequate, the value of our intangible assets may be diminished and competitors may be able to replicate our solutions and methods of\noperations. Any of the foregoing events could have a material adverse effect on our business, financial condition, and results of operations.\n\n \n\n**Risks\nRelated to Legal Proceedings**\n\n** **\n\n**We\nmay incur material losses and costs as a result of lawsuits or claims that may be brought against us which are related to product liability,\nwarranty, product recalls, client service interruptions or other matters, and any litigation against us could be costly and time-consuming\nto defend and could harm our business, financial condition and results of operations.**\n\n** **\n\nWe\nare exposed to product liability and product warranty claims in the normal course of business, in the event that our solutions actually\nor allegedly fail to perform as expected, or the use of our solutions results, or is alleged to result, in non-compliance with applicable\nregulations, bodily injury and/or property damage. Our safety and security services may be disabled or prove to be ineffective as a result\nof techniques employed by car thieves or the discovery of technological weaknesses by such persons. We could experience material product\nwarranty or product liability costs in the future.\n\n \n\nEffective\nJuly 1, 2025, our third-party vehicle recovery provider discontinued the 3-year limited stolen vehicle recovery warranty for new subscribers.\nAs a result, new subscribers on or after July 1, 2025 no longer receive this warranty.  Although we have no observed an adverse\nimpact on our sales performance since the warranty was discontinued, the limited warranty that remain in effect subscribers who enrolled\nprior to July 1, 2025, may still expose us to future litigation and associated costs.\n\n \n\nIf\nthere were a systematic failure of any of our solutions, we could suffer significant damage to our reputation and any product liability\ninsurance we maintain might not be sufficient to prevent us from suffering a material economic loss. While we carry insurance and maintain\nreserves for product liability claims, we have not established a liability reserve under these warranties. Our insurance coverage may\nbe inadequate if such claims do arise, and any defense costs and liability not covered by insurance could have a material adverse impact\non our financial condition, results of operations or cash flow. A future claim could involve the imposition of punitive damages, the\naward of which, pursuant to local laws, may not be covered by insurance. In addition, warranty and certain other claims are not typically\ncovered by insurance. Any product liability or warranty issues may adversely impact our reputation as a manufacturer of high-quality,\neffective and safe solutions and could have a material adverse effect on our business, results of operations and financial condition.\n\n \n\nFurthermore,\nwe have in the past and may in the future become subject to legal proceedings and claims that arise in the ordinary course of business,\nsuch as claims brought by our clients or vendors in connection with commercial disputes or employment claims made by our current or former\nemployees. Internal fraud, which may include the stealing and dissemination of customers’ personally identifiable information,\nmay also create significant customer distrust and result in litigation against us. Actions taken by third-party security officers involved\nin SVR operations as part of our services may also result in legal proceedings and claims which could then result in reputational harm\nto us or criminal and/or civil liability, including monetary damages or other penalties. See “Risk Factors— Risks Relating\nto Our Reliance on Third Parties—The conduct of third-party security officers engaged in SVR operations in support of our services\nfrom time to time involves the use of force, which could expose the Company to reputational harm or, potentially, civil and/or criminal\nliability.”\n\n \n\n29\n\n \n\n \n\nWe\nare unable to predict the outcome of such legal proceedings. Such proceedings might result in substantial costs, regardless of the outcome,\nand may divert management’s attention and resources, which might seriously harm our business, financial condition and results of\noperations. Insurance might not cover such claims, might not provide sufficient payments to cover all the costs to resolve one or more\nsuch claims, and might not continue to be available on terms acceptable to us. A claim brought against us that is uninsured or underinsured\ncould result in unanticipated costs, potentially resulting in a material adverse effect on our business, financial condition, and results\nof operations.\n\n \n\n**Risks\nRelating to Our Operations in South Africa and Other Emerging Markets**\n\n** **\n\n**We\nconduct a material amount of our business in foreign currencies, which heightens our exposure to the risk of exchange rate fluctuations.**\n\n** **\n\nWe\nare subject to fluctuations in foreign exchange rates between the South African rand, our reporting currency, and currencies of\nother countries where we market our solutions or source our raw components, for example the Euro, the Singapore dollar,\nPolish zloty, U.S. dollar and Mozambican metical. Such fluctuations may result in significant increases or decreases in our reported\nrevenue and other results as expressed in South African rand, and in the reported value of our assets, liabilities and cash flows.\nIn addition, currency fluctuation may adversely affect receivables, payables, debt, firm commitments and forecast transactions\ndenominated in foreign currencies. In particular, translation risks arise where parts of the cost of revenue are not denominated in\nthe same currency of such sales. The U.S. dollar/South African rand exchange rates have historically been volatile and we expect\nthis volatility to continue. Fluctuation in exchange rates, depreciation of local currencies, changes in monetary and/or fiscal\npolicy or inflation in the countries in which we operate could negatively impact the prices at which the ordinary shares trade and\nhave a material adverse effect on our business, financial condition, results of operations and prospects.\n\n \n\n**Exchange\ncontrols may restrict the ability of our subsidiaries to convert or transfer sums in foreign currencies.**\n\n** **\n\nOur\nability to generate operating cash flows at the holding company level depends on the ability of our subsidiaries, including Cartrack\nHoldings Proprietary Limited, to upstream funds. In particular, companies operating in South Africa are subject to exchange control limitations.\nExchange controls in South Africa are administered by the South African Reserve Bank (“SARB”) pursuant to the Exchange Control\nRegulations, 1961, as amended, which regulates transactions between South African residents and non-residents. While exchange controls\nhave been relaxed in recent years and may continue to be relaxed, South African companies remain subject to restrictions on their ability\nto export capital outside of the Common Monetary Area, which includes South Africa, Namibia, Lesotho and Eswatini. In addition, as the\ncash flows of certain countries are highly dependent on the export of certain raw materials, the ability to convert such currencies can\nbe limited by the timing of payments for such exports, which may require us to organize our currency conversions around such constraints.\nThese restrictions may affect the manner in which we finance our transactions outside South Africa and the geographic distribution of\nour debt.\n\n \n\nWe\ncan offer no assurance that additional restrictions on currency exchange will not be implemented in the future or that these restrictions\nwill not limit the ability of our subsidiaries to transfer cash to us, which could have a material adverse effect on our business, financial\ncondition, results of operations and prospects.\n\n \n\n**The\nmarkets in which we operate are exposed to high inflation and interest rates which could increase our operating costs and thereby reduce\nour profitability.**\n\n** **\n\nThe\neconomies of countries in which we operate, including South Africa, Mozambique, Tanzania and Kenya in the past have been, and in the\nfuture may continue to be, characterized by rates of inflation and interest rates that are substantially higher than those prevailing\nin the United States and other highly developed economies. High rates of inflation could increase our costs in such regions and decrease\nour operating margins. In particular, the inflation rate in South Africa, where we have significant operations, is relatively high compared\nto developed, industrialized countries. As at February 2026, the annual CPI stood at 3.0% compared to 3.2% in February 2025. Inflation\nin South Africa generally results in an increase in our operational costs in rand. Higher and sustained inflation in the future, with\na consequent increase in operational costs could have a material adverse effect on our results of operations and our financial condition\nand could result in operations being discontinued or reduced or rationalized, which could have a material adverse effect on our business,\nfinancial condition and results of operations.\n\n \n\nAlthough\nhigher interest rates would increase the amount of income we earn on our cash balances, they would also adversely affect our ability\nto obtain cost-effective debt financing in certain countries in which we operate.\n\n \n\n30\n\n \n\n \n\n**The\nlaws and regulations which we are subject to, such as U.S. and other anti-corruption laws, trade controls, economic sanctions and similar\nlaws and regulations in the jurisdictions which we operate, are complex and the regulatory and political regimes under which we operate\nare volatile. Our failure to comply with the relevant laws, regulations, executive orders and directives could subject us to civil, criminal\nand administrative penalties and harm our reputation.**\n\n** **\n\nDoing\nbusiness on a worldwide basis requires us to comply with the laws and regulations of various foreign jurisdictions, including those not\nspecifically related to our industry. These laws, regulations, executive orders, directives and enforcement priorities place restrictions\non our operations, trade practices, partners and investment decisions. In particular, our operations are subject to U.S. and foreign\nanti-corruption and trade control laws and regulations, such as the Foreign Corrupt Practices Act (the “FCPA”), export controls\nand economic sanctions programs, including those administered by the U.S. Treasury Department’s Office of Foreign Assets Control\n(“OFAC”). As a result of doing business in foreign countries and with foreign partners, we are exposed to a heightened risk\nof violating anti-corruption and trade control laws and sanctions regulations.\n\n \n\nThe\nFCPA prohibits us from providing anything of value to foreign officials for the purposes of obtaining or retaining business or securing\nany improper business advantage. It also requires us to keep books and records that accurately and fairly reflect our transactions. As\npart of our business, we may deal with state-owned business enterprises, the employees of which are considered foreign officials for\npurposes of the FCPA. In addition, the United Kingdom Bribery Act (the “Bribery Act”) extends beyond bribery of foreign public\nofficials and also apply to transactions with individuals not employed by a government. The provisions of the Bribery Act are also more\nonerous than the FCPA in a number of other respects, including jurisdiction, non- exemption of facilitation payments and penalties. Some\nof the international locations in which we operate lack a developed legal system and have higher than normal levels of corruption.\n\n \n\nEconomic\nsanctions programs restrict our business dealings with certain sanctioned countries, persons and entities, such as Zimbabwe, a country\nin which we have a licensee.\n\n \n\nViolations\nof anti-corruption and trade control laws and sanctions regulations are punishable by civil penalties, including fines, denial of export\nprivileges, injunctions, asset seizures, debarment from government contracts and revocations or restrictions of licenses, as well as\ncriminal fines and imprisonment. We have established policies and procedures designed to assist our compliance with applicable U.S. and\ninternational anti-corruption and trade control laws and regulations, including the FCPA, the Bribery Act and trade controls and sanctions\nprograms administered by OFAC, and have trained our employees to comply with these laws and regulations. However, there can be no assurance\nthat all of our employees, consultants, agents or other associated persons will not take actions in violation of our policies and these\nlaws and regulations, and that our policies and procedures will effectively prevent us from violating these regulations in every transaction\nin which we may engage or provide a defense to any alleged violation. In particular, we may be held liable for the actions that our local\nstrategic partners take inside or outside of the United States, even though our partners may not be subject to these laws. Such a violation,\neven if our policies prohibit it, could have a material adverse effect on our reputation, business, results of operations and financial\ncondition.\n\n \n\nOur\ncontinued international expansion, including in developing countries, and our development of new partnerships and joint venture relationships\nworldwide, could increase the risk of FCPA, OFAC or Bribery Act violations in the future. Additionally, our software contains encryption\ntechnologies, certain types of which are subject to U.S. and foreign export control regulations and, in some foreign countries, restrictions\non importation and/or use. Any failure on our part to comply with encryption or other applicable export control requirements could result\nin financial penalties or other sanctions under the U.S. export regulations, including restrictions on future export activities, which\ncould harm our business and results of operations. Regulatory restrictions could impair our access to technologies needed to improve\nour solutions and may also limit or reduce the demand for our solutions in certain geographic regions.\n\n \n\n31\n\n \n\n \n\nFurthermore,\nwe currently market and sell regulated insurance products as an intermediary agent in South Africa through a brokerage registered as\nan authorized Financial Services Provider (“FSP”) that is a wholly owned subsidiary of ours. FSPs are subject to a variety\nof regulations, including the Financial Advisory and Intermediary Services Act, No. 37 of 2002. We may from time-to-time face challenges\nresulting from changes in applicable law and regulations in South Africa, or changes in approach to oversight of the insurance brokerage\nbusiness or other regulators in South Africa.\n\n \n\nAdditionally,\nwe have to comply with the South African anti-corruption law, the Prevention and Combating of Corrupt Activities Act, No. 12 of 2004,\nas amended (“PRECCA”). This law prohibits public and private bribery and criminalizes various categories of corrupt activities.\nPRECCA also contains a reporting obligation to authorities of known or suspected corrupt activities which is triggered when the value\nof any known or suspected acts of corruption exceeds ZAR 100,000. Failure to report said corrupt activities is a criminal offense under\nPRECCA and imposes significant penalties on those convicted of corrupt activities. Regulation 43 of the South African Companies Act No.\n71 of 2008 (“South African Companies Act”) also contains a number of anti-corruption compliance obligations that we must\nadhere to.\n\n \n\nAlthough\nwe have policies and procedures in place to comply with financial crime regulation, these policies and procedures may not prevent all\nsituations of money laundering, bribery, fraud or corruption, including actions by our employees, for which we might be held responsible.\nAny such event may have severe consequences, including sanctions, fines and reputational consequences, which could have a material adverse\neffect on our business, financial condition, results of operations and prospects.\n\n \n\n**Operating\nin emerging markets, such as South Africa, subjects us to greater political, economic and market risks than those we would face if we\nonly operated in more developed markets, which could increase our operating costs.**\n\n** **\n\nFor\nthe financial year ended February 28, 2026, 75% (FY 2025: 74%) of our revenue was derived from South Africa. Emerging markets, including\nSouth Africa, are subject to greater risks than more developed markets. The political, economic and market conditions in many emerging\nmarkets present risks that could make it more difficult to operate our business successfully. These risks include:\n\n \n\n \n●\nthe\nstrength of emerging market economies;\n\n \n\n \n●\nfluctuations\nin interest rates;\n\n \n\n \n●\npolitical\nand economic instability, including higher rates of inflation and currency fluctuations;\n\n \n\n \n●\nhigh\nlevels of crime and unemployment;\n\n \n\n \n●\ninconsistent\nsupply or failure of infrastructure;\n\n \n\n \n●\nhigher\nlevels of corruption, including bribery of public officials;\n\n \n\n \n●\nloss\ndue to civil strife, acts of war or terrorism, guerrilla activities and insurrection;\n\n \n\n \n●\na\nlack of well-developed legal systems which could make it difficult for us to enforce our intellectual property and contractual rights;\n\n \n\n \n●\npotential\nadverse changes in laws and regulatory practices, including import and export license requirements and restrictions, tariffs, taxation\nand other laws or policies affecting foreign trade or investment;\n\n \n\n32\n\n \n\n \n\n \n●\nrestrictions\non the right to convert or repatriate currency or export assets;\n\n \n\n \n●\nintroduction\nof or changes to indigenization and empowerment programs;\n\n \n\n \n●\nlogistical\nand communications challenges;\n\n \n\n \n●\ndifficulties\nin staffing and managing operations and ensuring the safety of our employees;\n\n \n\n \n●\ngreater\nrisk of uncollectible accounts and longer collection cycles; and\n\n \n\n \n●\nfuture\ndowngrades of the debt ratings of the countries in which we operate, particularly in South Africa, where the current sovereign debt\ncredit rating is below investment grade, with a predominantly stable outlook;\n\n \n\nIf\nwe are unable to effectively manage these risks, it could have a material adverse effect on our business, financial condition and results\nof operations.\n\n \n\nWe\nhave operations in other African and Asian countries, and governments in Africa and Asia have in the past intervened in the economies\nof their respective countries and occasionally made significant changes in policy and regulations. Governmental actions have often involved,\namong other measures, nationalizations and expropriations, price controls, currency devaluations, mandatory increases on wages and employee\nbenefits, capital controls, limits on imports and arbitrary interference with private ownership of contract rights. Our business, financial\ncondition and results of operations may be adversely affected by changes in government policies or regulations, including such factors\nas exchange rate and exchange control policies, inflation control policies, price control policies, consumer protection policies, import\nduties and restrictions, liquidity of domestic capital and lending markets, electricity rationing, tax policies, including tax increases\nand retroactive tax claims, and other political, diplomatic, social and economic developments in or affecting the countries in which\nwe operate. In the future, the level of intervention by African and Asian governments may continue to increase. It is difficult to predict\nthe future political, economic and market environment in these countries, and these or other measures could have a material adverse effect\non the economy of the countries in which we operate and, consequently, could have a material adverse effect on our business, financial\ncondition and results of operations.\n\n \n\n**We\nface the risk of disruption from labor disputes and changes to labor laws, which could result in significant additional operating costs\nor alter our relationship with our employees.**\n\n** **\n\nWe\nare required to comply with extensive labor regulations in each of the countries in which we have employees, including with respect to\nwages, social security benefits and termination payments. In particular, South African laws relating to labor regulate work time, provide\nfor mandatory compensation in the event of termination of employment for operational reasons, and impose monetary penalties for non-compliance\nwith administrative and reporting requirements in respect of affirmative action policies, could result in significant costs.\n\n \n\nLabor\nlegislation in South Africa has stringent requirements in relation to the relationship with employees. For example, under the Labour\nRelations Amendment Act, No. 66 of 1995 (as amended) (the “LRA”), an employee on a fixed term contract must be permanently\nemployed unless the employer can establish justification for employment on a fixed term basis. The reasons available to an employer for\njustifying a fixed term contract are limited. Temporary employees are required to be given the same pay and benefits as permanent employees,\nincluding pensions and medical insurance coverage. The LRA provides strict penalties for failure to comply with its provisions and in\ncertain instances breach of the legislation amounts to a criminal offense.\n\n \n\nFurthermore,\nthe Employment Equity Act, No. 55 of 1998 (as amended) (the “EEA”) creates obligations and administrative requirements in\nrespect of non-discrimination and equity in employment matters. Fines of up to 10% of revenue may be imposed in the event of non-compliance\nwith certain provisions of the EEA.\n\n \n\nIn\naddition, future changes to South African legislation and regulations relating to labor may increase our costs or alter our relationship\nwith our employees. Resulting disruptions could have a material adverse effect on our business, results of operations and financial condition.\n\n \n\n33\n\n \n\n \n\n**If\nwe do not achieve applicable black economic empowerment objectives in our South African operations, we risk early termination of certain\nof our subscription contracts and the loss of the corresponding revenue.**\n\n** **\n\nThe\nSouth African government, through the Broad-Based Black Economic Empowerment Act No, 53 of 2003 (as amended), and the codes of good practice\nand industry charters published pursuant thereto, has established a legislative framework for the promotion of broad-based black economic\nempowerment, or “B-BBEE”. Achievement of specified B- BBEE objectives is measured by a scorecard which establishes a weighting\nfor the various objectives of B-BBEE, which include procuring goods and services from black-owned businesses (or from businesses that\nhave earned good B-BBEE scores) and achieving certain levels of black South African employment and management participation, which is\nthen translated to an entity’s “contributor level”. Compliance may affect the ability of a company to secure contracts\nin the public and private sectors in South Africa. We have some customers that require us to maintain specific/specified B-BBEE contributor\nlevels as measured under the Amended Broad-Based Black Economic Empowerment Information and Communication Technology Sector Code. We\ncurrently maintain a level 8 B-BBEE contributor level.\n\n \n\nThe\ngovernment has set, and is in the process of setting, specific equity targets by sector and region, where transformation initiatives\nhave lagged.\n\n \n\nFailing\nto achieve or maintain a specified B-BBEE contributor level could affect our ability to maintain existing customers or to sell to large\nenterprise customers in South Africa, which could have an adverse effect on our business, financial condition and results of operations.\n\n \n\n**Tax\nregulations and challenges by tax authorities could have a material adverse effect on us and we may be subject to challenges by tax authorities.**\n\n** **\n\nWe\noperate in a number of countries and are therefore regularly examined by and remain subject to numerous tax regulations. Changes in our\nglobal mix of earnings could affect our effective tax rate.\n\n \n\nFurthermore,\nchanges in tax laws could result in higher tax-related expenses and payments. Legislative changes in any of the countries in which our\nbusinesses operate could materially impact our tax receivables and liabilities as well as deferred tax assets and deferred tax liabilities.\nAdditionally, the uncertain tax environment in some regions in which our businesses operate may limit our ability to successfully challenge\nadverse determination by any local tax authorities. Some of our businesses operate in countries with complex tax rules, which may be\ninterpreted in a variety of ways and could affect our effective tax rate. Future interpretations or developments of tax regimes or a\nhigher than anticipated effective tax rate could have a material adverse effect on our tax liability, return on investments and business\noperations.\n\n \n\nIn\naddition, we and our businesses operate in, are incorporated in and are tax residents of, various jurisdictions. The tax authorities\nin the various jurisdictions in which we and our businesses operate, or are incorporated, may disagree with and challenge our assessments\nof our transactions, tax position, deductions, exemptions, where we or our subsidiaries or businesses are tax resident, or other matters.\nIf we, or our businesses, are unsuccessful in responding to any such challenge from a tax authority, we, or our businesses, may be required\nto pay additional taxes, interest, fines or penalties, we, or our businesses, may be subject to taxes for the same business in more than\none jurisdiction or may also be subject to higher tax rates, withholding or other taxes. A successful challenge could potentially result\nin payments to the relevant tax authority of substantial amounts that could have a material adverse effect on our financial condition\nand results of operations.\n\n \n\nResponding\nto any challenges by tax authorities may be expensive, consume time and other resources, or divert management’s time and focus\nfrom the operations of our businesses, even if we are successful. Therefore, a challenge as to our, or our businesses’, tax position\nor status or transactions, may have a material adverse effect on our business, financial condition, results of operations or liquidity\nof our businesses.\n\n \n\n34\n\n \n\n \n\n**A\nbreach of any of the covenants or other provisions contained in funding facilities could result in an event of default, which could result\nin amounts outstanding under these facilities becoming immediately due and payable as well as foreclosure by our lenders upon our critical\nassets.**\n\n** **\n\nOur\nwholly-owned subsidiary, Cartrack (Pty) Ltd, entered into a short-term facility with Capitec Bank Limited and The Standard Bank of South\nAfrica Limited. Purple Rain Properties No 444 Proprietary Limited, also a wholly-owned subsidiary, entered into a mortgage bond in favor\nof The Standard Bank of South Africa Limited. These facilities are more fully described under Item 5.B. “Operating and Financial\nReview and Prospects - Liquidity and Capital Resources - Loan and Funding Facilities.”\n\n \n\nSimilarly,\nCartrack Portugal, S.A., secured a EUR 2.0 million and EUR1.0 million loan, from Banco Comercial Português, S.A.\n\n \n\nIn\nthe event that we enter into a funding facility with any of our bankers, it is customary for obligations under such credit facility agreement\nto be guaranteed by one or more of our significant subsidiaries and to be secured by a lien on bank accounts, cash and cash equivalent\ninvestments, intellectual property, insurance policies, insurance proceeds and a pledge of the shares of certain of our subsidiaries\nincorporated in South Africa. A breach of any of these covenants or other provisions of credit facilities could result in an event of\ndefault, which if not cured or waived, could result in amounts outstanding under such credit facilities becoming immediately due and\npayable. In the event that some or all of the amounts outstanding under such credit facilities are accelerated and become immediately\ndue and payable, we may not have the funds to repay, or the ability to refinance, such outstanding amounts under the credit facilities,\nor our lenders could foreclose upon critical assets, which could have a material adverse effect on our business, results of operations\nand financial condition.\n\n \n\n**Changes\nin practices of insurance companies in the markets in which we provide our solutions could have an adverse effect on demand for products\nand services.**\n\n** **\n\nWe\ndepend in part on the practices of insurance companies in some of our markets to support demand for our operational intelligence platform.\nFor example, in South Africa, which is currently our largest market based on new subscriber additions, insurance companies either mandate\nthe installation of tracking devices as a prerequisite for providing insurance coverage to owners of certain vehicles, or provide insurance\npremium discounts to encourage vehicle owners to subscribe to vehicle tracking and mobile asset recovery solutions such as ours. We benefit\nfrom this continued practice in the South African and certain other markets of:\n\n \n\n \n●\naccepting\nmobile asset location technologies such as ours as a preferred security product;\n\n \n\n \n●\nproviding\npremium discounts for using location and recovery products and services such as ours; and\n\n \n\n \n●\nmandating\nthe use of our products and services, or similar products and services, for certain vehicles.\n\n \n\nIf\nany of these policies or practices change, revenues from the sale of our solutions could decline, which could have a material adverse\neffect on our business, results of operations and financial condition.\n\n \n\n**Risks\nRelating to Investments in Singapore Companies**\n\n** **\n\n**We\nare incorporated in Singapore, and our shareholders may have more difficulty in protecting their interests than they would as shareholders\nof a corporation incorporated in the United States.**\n\n** **\n\nOur\ncorporate affairs are governed by our constitution and by the laws governing companies incorporated in Singapore. The rights of our shareholders\nand the responsibilities of the members of our board of directors under Singapore law may be different from those applicable to a corporation\nincorporated in the United States. Therefore, our public shareholders may have more difficulty in protecting their interests in connection\nwith actions taken by us, our management, members of our board of directors or our controlling shareholder than they would as shareholders\nof a corporation incorporated in the United States. For example, controlling shareholders in corporations incorporated in Delaware are\nsubject to fiduciary duties while controlling shareholders in Singapore companies are not subject to such duties.\n\n \n\n35\n\n \n\n \n\nIn\naddition, only persons who are registered as shareholders in our register of members are recognized under Singapore law as our shareholders.\nOnly registered shareholders have legal standing to institute shareholder actions against us or otherwise seek to enforce their rights\nas shareholders. Investors in our ordinary shares who are not specifically registered as shareholders in our register of members (for\nexample, where such shareholders hold ordinary shares indirectly through the depository trust company “DTC”) are required\nto be registered as shareholders in our register of members in order to institute or enforce any legal proceedings or claims against\nus, our directors or our executive officers relating to shareholder rights. The administrative process of becoming a registered shareholder\ncould result in delays prejudicial to any such legal proceeding or enforcement action. See Exhibit 2.2 “Description of Ordinary\nShares—Comparison of Shareholder Rights” for a discussion of certain differences between Singapore and Delaware corporation\nlaw.\n\n \n\n**It\nmay be difficult for you to enforce any judgment obtained in the United States against us, our directors, officers or our affiliates.**\n\n** **\n\nA\nmajority of our directors and officers reside outside the United States. In addition, a majority of our assets and the assets of those\npersons are located outside the United States. As a result, it may be difficult to enforce in the United States any judgment obtained\nin the United States against us or any of these persons, including judgments based upon the civil liability provisions of the U.S. securities\nlaws. In addition, in original actions brought in courts in jurisdictions located outside the United States, it may be difficult for\ninvestors to enforce liabilities based upon U.S. securities laws.\n\n \n\nThere\nis no treaty between the United States and Singapore providing for the reciprocal recognition and enforcement of judgments in civil and\ncommercial matters and a final judgment for the payment of money rendered by any federal or state court in the United States based on\ncivil liability, whether or not predicated solely upon the federal securities laws, would, therefore, not be automatically enforceable\nin Singapore. It is not clear whether a Singapore court may impose civil liability on us or our directors and officers who reside in\nSingapore in an action brought in the Singapore courts against us or such persons with respect to a violation solely of the federal securities\nlaws of the United States.\n\n \n\nIn\naddition, holders of book-entry interests in the ordinary shares (for example, where such shareholders hold ordinary shares indirectly\nthrough the DTC) will be required to be registered shareholders as reflected in our register of members in order to have standing to\nbring a shareholder action and, if successful, to enforce a foreign judgment against us, our directors or our executive officers in the\nSingapore courts. Any such enforcement action would be subject to applicable Singapore laws. The administrative process of becoming a\nregistered shareholder could result in delays that could be prejudicial to any legal proceeding or enforcement action. In making a determination\nas to enforceability of a judgment of a state court or a federal court of the United States, the Singapore courts would have regard to,\namong others, whether the judgment was final and conclusive, given by a court of law of competent jurisdiction, expressed to be for a\nfixed sum of money, whether it was procured by fraud, or in breach of principles of natural justice, or whether the enforcement thereof\nwould be contrary to public policy.\n\n \n\nAccordingly,\nthere can be no assurance that the Singapore courts would enforce against us, our directors or our officers, judgments obtained in the\nUnited States which are predicated upon the civil liability provisions of the federal securities laws of the United States.\n\n \n\n**Subject\nto the general authority to allot and issue new ordinary shares provided by our shareholders, the Singapore Companies Act and our constitution,\nour directors may allot and issue new ordinary shares on terms and conditions and for such purposes as may be determined by our board\nof directors in its sole discretion. Any issuance of new shares would dilute the percentage ownership of existing shareholders and could\nadversely impact the market price of our ordinary shares.**\n\n** **\n\nUnder\nSingapore law, we may only allot and issue new ordinary shares with the prior approval of our shareholders in a general meeting. Subject\nto the general authority to allot and issue new ordinary shares provided by our shareholders, the provisions of the Singapore Companies\nAct, and our constitution, we may allot and issue new ordinary shares on such terms and conditions as our directors may think fit to\nimpose. Such terms and conditions may be adverse to the rights of holders of our ordinary shares. Any additional issuances of new ordinary\nshares could dilute the percentage ownership of our existing shareholders and may adversely impact the market price of our ordinary shares.\n\n \n\n36\n\n \n\n \n\nBecause\nnew issuances of ordinary shares are subject to shareholder approval, if a sufficient number of shares have not been approved for issuance\nin any given year, we may be delayed in raising capital through equity offerings or delayed or prevented from consummating an acquisition\nusing our ordinary shares.\n\n \n\nAssuming\nshareholders have approved the issuance of new shares, we may seek to raise capital in the future, including to fund acquisitions, future\ninvestments and other growth opportunities. We may, for these and other purposes, issue additional ordinary shares or securities convertible\ninto ordinary shares. Any additional issuances of new ordinary shares could dilute the percentage ownership of our existing shareholders\nand may also adversely impact the market price of our ordinary shares.\n\n \n\n**We\nare subject to the laws of Singapore, which differ in certain material respects from the laws of the United States.**\n\n** **\n\nAs\na Singapore-incorporated company, we are required to comply with the laws of Singapore, certain of which are capable of extra-territorial\napplication, as well as our constitution. In particular, we are required to comply with certain provisions of the Securities and Futures\nAct, Chapter 289 of Singapore, which prohibit certain forms of market conduct and information disclosures, and impose criminal and civil\npenalties on corporations, directors and officers in respect of any breach of such provisions. In addition, the Singapore Code on Take-Overs\nand Mergers, or “Singapore Take-Over Code”, which specifies, among other things, certain circumstances in which a general\noffer is to be made upon a change in control of a Singapore-incorporated public company, and further specifies the manner and price at\nwhich voluntary and mandatory general offers are to be made.\n\n \n\nThe\nlaws of Singapore and of the United States differ in certain significant respects. The rights of our shareholders and the obligations\nof our directors and officers under Singapore law may be different from those applicable to U.S. corporations, including those incorporated\nin Delaware, in material respects, and our shareholders may have more difficulty and less clarity in protecting their interests in connection\nwith actions taken by our management, members of our board of directors or our controlling shareholders than would otherwise apply to\nU.S. corporations, including those incorporated in Delaware. See Exhibit 2.2 “Description of Ordinary Shares—Comparison of\nShareholder Rights” for a discussion of certain differences between Singapore and Delaware corporation law.\n\n \n\nIn\naddition, the application of Singapore law, in particular, the Singapore Companies Act may, in certain circumstances, impose more restrictions\non us, our shareholders, directors and officers than would otherwise be applicable to U.S. corporations, including those incorporated\nin Delaware. For example, the Singapore Companies Act requires a director to act with a reasonable degree of diligence in the discharge\nof the duties of his office and, in certain circumstances, imposes criminal liability for specified contraventions of particular statutory\nrequirements or prohibitions. In addition, pursuant to the provisions of the Singapore Companies Act, shareholders holding 10% or more\nof the total number of paid-up shares as at the date of the deposit carrying the right of voting at general meetings (disregarding paid-up\nshares held as treasury shares) may by depositing a requisition, require our directors to convene an extraordinary general meeting. If\nour directors do not within 21 days after the date of deposit of the requisition proceed to convene a meeting, the requisitioning shareholders,\nor any of them representing more than 50% of the total voting rights represented of all of them, may themselves, proceed to convene such\nmeeting, and we will be liable for the reasonable expenses incurred by such requisitioning shareholders. We are also required by the\nSingapore Companies Act to deduct corresponding amounts from fees or other remuneration payable by us to such of the directors who are\nin default.\n\n \n\n37\n\n \n\n \n\n**Singapore\ntake-over laws contain provisions that may vary from those in other jurisdictions.**\n\n** **\n\nThe\nSingapore Take-Over Code applies to, among others, corporations with a primary listing of their equity securities in Singapore. While\nthe Singapore Take-Over Code is drafted with, among others, listed public companies in mind, unlisted public companies with more than\n50 (fifty) shareholders and net tangible assets of S$5.0 million or more, must also observe the letter and spirit of the general principles\nand rules of the Singapore Take-Over Code, wherever this is possible and appropriate. Public companies with a primary listing overseas\nmay apply to Securities Industry Council (“SIC”) to waive the application of the Singapore Take-Over Code. As at the date\nof this annual report, no application has been made to SIC to waive the application of the Singapore Take-Over Code in relation to us.\n\n \n\nIn\nthis regard, the Singapore Take-Over Code contains certain provisions that may possibly delay, deter or prevent a future take-over or\nchange in control of us. Under the Singapore Take-Over Code, except with the consent of SIC, any person acquiring an interest, whether\nby a series of transactions over a period of time or not, either on his own or together with parties acting in concert with him, in 30%\nor more of our voting shares is required to extend a take-over offer for all remaining voting shares in accordance with the procedural\nand other requirements under the Singapore Take-Over Code.\n\n \n\nExcept\nwith the consent of SIC, such a take-over offer is also required to be made if a person holding between 30% and 50% (both inclusive)\nof our voting shares, either on his own or together with parties acting in concert with him, acquires additional voting shares representing\nmore than 1% of our voting shares in any six-month period. While the Singapore Take-Over Code seeks to ensure an equality of treatment\namong shareholders in take-over or merger situations, its provisions could substantially impede the ability of the shareholders to benefit\nfrom a change of control and, as a result, may adversely affect the market price of the ordinary shares and the ability to realize any\nbenefit from a potential change of control.\n\n \n\n**Risks\nRelating to Our Ordinary Shares**\n\n** **\n\n**Our\nstock price may fluctuate and you could lose all or a significant part of your investment.**\n\n** **\n\nThe\nmarket price of our ordinary shares may be influenced by many factors, some of which are beyond our control, including:\n\n \n\n \n●\nactual\nor anticipated variations in our operating results;\n\n \n\n \n●\nthe\nfailure of financial analysts to cover our ordinary shares;\n\n \n\n \n●\nchanges\nin financial estimates by financial analysts, or any failure by us to meet or exceed any of these estimates, or changes in the recommendations\nof any financial analysts that elect to follow our ordinary shares or the shares of our competitors;\n\n \n\n \n●\nchanges\nin market valuations of similar companies;\n\n \n\n \n●\nannouncements\nby us or our competitors of significant contracts, acquisitions, strategic partnerships or joint ventures;\n\n \n\n \n●\nfuture\nsales of our shares by us or our shareholders;\n\n \n\n \n●\nshort\nsales, hedging and other derivative transactions involving our ordinary shares and the publication of short seller and similar reports;\n\n \n\n38\n\n \n\n \n\n \n●\ninvestor\nperceptions of us and the industry in which we operate;\n\n \n\n \n●\ngeneral\neconomic, industry or market conditions; and\n\n \n\n \n●\nthe\nother factors described in this “Risk Factors” section.\n\n \n\nIn\naddition, the stock market in general has experienced substantial price and volume fluctuations that have often been unrelated or disproportionate\nto the operating performance of the particular companies affected. These broad market and industry factors may materially harm the market\nprice of our ordinary shares, regardless of our operating performance. In the past, following periods of volatility in the market price\nof certain companies’ securities, securities class action litigation has been instituted against these companies. This type of\nlitigation, if instituted against us, could have a material adverse effect on our business, financial condition and results of operations.\n\n \n\n**The\nordinary shares are traded on more than one stock exchange and this may result in price variations between the markets.**\n\n** **\n\nThe\nordinary shares are listed on each of the Nasdaq and the JSE. Trading in the ordinary shares therefore will take place in different currencies\n(U.S. dollars on the Nasdaq and South African Rand on the JSE), and at different times (resulting from different time zones, different\ntrading days and different public holidays in the United States and South Africa). The trading prices of the ordinary shares on these\ntwo markets may differ as a result of these, or other, factors. Any decrease in the price of ordinary shares on either one of these markets\ncould cause a decrease in the trading prices of ordinary shares on the other market.\n\n \n\n**Sales\nof substantial amounts of our ordinary shares in the public market, or the perception that these sales may occur, could cause the market\nprice of our ordinary shares to decline.**\n\n** **\n\nSales\nof substantial amounts of our ordinary shares in the public market, or the perception that these sales may occur, could cause the market\nprice of our ordinary shares to decline. This could also impair our ability to raise additional capital through the sale of our equity\nsecurities. We are authorized to issue an unlimited number of shares as there is no concept of authorized share capital under Singapore\nlaw. Moreover, we have entered into a registration rights agreement pursuant to which we have granted demand and piggyback registration\nrights to our Chief Executive Officer, Isaias (Zak) Jose Calisto.\n\n \n\n**Although\nwe have paid dividends in the past, our ability to pay dividends in the future depends on many factors and we cannot guarantee you that\nwe will continue to pay dividends in the future.**\n\n** **\n\nThe\npayment and timing of dividends in cash or other distributions (such as a return of capital to shareholders through share buy-backs,\nfor example) are determined by the board after considering factors that include: earnings and Free Cash Flow; current and anticipated\ncapital requirements; economic conditions; contractual, legal, tax and regulatory restrictions (including covenants contained in any\nfinancing agreements); the ability of Group subsidiaries to distribute funds to Karooooo; and such other factors the board may deem relevant.\nWe aim to reinvest retained earnings to the extent that it aligns with the Group’s required return on incrementally reinvested\ncapital, return on equity, and short to medium-term growth strategy. The board may, by ordinary resolution, declare dividends at a general\nmeeting of its shareholders, but no dividend shall be payable except out of our profits, and the amount of any such dividend shall not\nexceed the amount recommended by the board of directors. Subject to Karooooo’s constitution and in accordance with the Singapore\nCompanies Act, the board of directors may, without the approval of shareholders, declare and pay interim dividends, but any final dividends\nthe board declares must be approved by an ordinary resolution at a general meeting of shareholders.\n\n \n\nWe\ncannot provide assurances regarding the amount or timing of dividend payments and may decide not to pay dividends in the future. As a\nresult, you should not rely on an investment in our ordinary shares to provide dividend income and if we do not pay dividends, capital\nappreciation, if any, of our ordinary shares will be a shareholder’s sole source of gain in the near future. See “Dividends\nand Dividend Policy.”\n\n \n\n39\n\n \n\n \n\n**If\nsecurities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, the price\nof our ordinary shares and our trading volume could decline.**\n\n** **\n\nThe\ntrading market for our ordinary shares will depend in part on the research and reports that securities or industry analysts publish about\nus or our business. Securities and industry analysts do not currently, and may never, publish research on our company. If no or too few\nsecurities or industry analysts commence coverage of our company, the trading price for our ordinary shares would likely be negatively\naffected. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover us downgrade our ordinary\nshares or publish inaccurate or unfavorable research about our business, the price of our ordinary shares would likely decline. If one\nor more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our ordinary shares could\ndecrease, which might cause the price of our ordinary shares and trading volume to decline.\n\n \n\n**Requirements\nassociated with being a public company in the United States require significant company resources and management attention.**\n\n** **\n\nAs\na U.S. public company, we incur significant additional legal, accounting, reporting, compliance and other expenses as a result of having\npublicly traded ordinary shares in the United States. We also incur costs including, but not limited to, costs and expenses for directors’\nfees, increased directors’ and officers’ insurance, investor relations, and various other costs relating to being a public\ncompany registered in the United States.\n\n \n\nWe\nalso incur costs associated with United States corporate governance requirements, including requirements under SOX, as well as rules\nimplemented by the SEC, Nasdaq and the JSE. These rules and regulations increase our legal and financial compliance costs and make some\nmanagement and corporate governance activities more time-consuming and costly, particularly after we are no longer an “emerging\ngrowth company.” These rules and regulations make it more difficult and more expensive for us to obtain director and officer liability\ninsurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same\nor similar coverage. This could have an adverse impact on our ability to recruit and retain a qualified independent board.\n\n \n\nOur\nsenior management and other employees have devoted, and will need to continue to devote, a substantial amount of time and attention away\nfrom revenue producing activities to management and administrative oversight, adversely affecting our ability to attract and complete\nbusiness opportunities and increasing the difficulty in both retaining professionals and managing and growing our businesses. Furthermore,\nnew rules and regulations relating to disclosure, financial reporting and controls and corporate governance, or varying interpretations\nof existing rules and regulations, could be adopted by the SEC, Nasdaq or other regulatory bodies and exchange entities from time to\ntime, and could result in a significant increase in legal, accounting and compliance costs and make certain activities more time-consuming\nand costly. Any of these effects could have a material adverse effect on our business, financial condition and results of operations.\n\n \n\nFor\nas long as we are an “emerging growth company” under the JOBS Act, our independent registered public accounting firm will\nnot be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of SOX. We could\nbe an emerging growth company for up to five years from our IPO. See “Summary— Implications of Being an Emerging Growth Company,”\nbelow.\n\n \n\nFurthermore,\nafter the date we are no longer an emerging growth company, our independent registered public accounting firm will only be required to\nattest to the effectiveness of our internal control over financial reporting depending on our market capitalization. Even if our management\nconcludes that our internal control over financial reporting is effective, our independent registered public accounting firm may still\ndecline to attest to our management’s assessment or may issue an adverse opinion report if it is not satisfied with our controls\nor the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently\nfrom us. In addition, in connection with the implementation of the necessary procedures and practices related to internal control over\nfinancial reporting, we may identify deficiencies that we may not be able to remediate in time to meet the deadline imposed by SOX for\ncompliance with the requirements of Section 404(b). Failure to comply with Section 404(b) could subject us to regulatory scrutiny and\nsanctions, impair our ability to raise capital, cause investors to lose confidence in the accuracy and completeness of our financial\nreports and negatively affect our share price.\n\n \n\n40\n\n \n\n \n\n**As\na foreign private issuer and “controlled company” within the meaning of the Nasdaq rules, we are permitted to, and we will,\nrely on exemptions from certain corporate governance standards. Our reliance on such exemptions may afford less protection to holders\nof our ordinary shares.**\n\n** **\n\nNasdaq’s\ncorporate governance rules require listed companies to have, among other things, a majority of independent directors and independent\ndirector oversight of executive compensation, nomination of directors and corporate governance matters. As a foreign private issuer,\nwe are permitted to, and we will, follow home country practice in lieu of the above requirements. While a majority of the directors on\nour board of directors are independent directors and all of our board committees consist entirely of independent directors, as long as\nwe rely on the foreign private issuer exemption to certain of the Nasdaq corporate governance standards, a majority of the directors\non our board of directors are not required to be independent directors, and that certain of our board committees do not have to consist\nentirely of independent directors. Therefore, to the extent we rely on such exemptions in the future, our board of directors’ approach\nto governance may be different from that of a board of directors consisting of a majority of independent directors, and, as a result,\nthe management oversight of our company may be more limited than if we were subject to all of the Nasdaq corporate governance standards.\n\n \n\nIn\nthe event we no longer qualify as a foreign private issuer, we intend to rely on the “controlled company” exemption under\nthe Nasdaq corporate governance rules. A “controlled company” under the Nasdaq corporate governance rules is a company of\nwhich more than 50% of the voting power is held by an individual, group or another company. Our controlling shareholder controls a majority\nof the combined voting power of our outstanding ordinary shares, making us a “controlled company” within the meaning of the\nNasdaq corporate governance rules. As a controlled company, we would be eligible to elect not to comply with certain of the Nasdaq corporate\ngovernance standards, including the requirement that a majority of directors on our board of directors are independent directors and\nthat certain of our board committees consist entirely of independent directors. We may utilize some of these exemptions.\n\n \n\nAccordingly,\nour shareholders will not have the same protection afforded to shareholders of companies that are subject to all of the Nasdaq corporate\ngovernance standards, and the ability of our independent directors to influence our business policies and affairs may be reduced.\n\n \n\n**If\nwe fail, for any reason, to effectively or efficiently maintain proper internal control procedures, such failure could materially and\nadversely affect our business, results of operations and financial condition.**\n\n** **\n\nSection\n404(a) of SOX, requires that management assess and report annually on the effectiveness of our internal control over financial reporting\nand identify any material weaknesses in our internal control over financial reporting. Although Section 404(b) of SOX, requires our independent\nregistered public accounting firm to issue an annual report that addresses the effectiveness of our internal control over financial reporting,\nwe have opted to rely on the exemptions provided in the JOBS Act, and consequently will not be required to comply with U.S. Securities\nand Exchange Commission (“SEC”) rules that implement Section 404(b) until such time as we are no longer an EGC.\n\n \n\nIf\nit is determined that we are not in compliance with Section 404(a), we will be required to implement new internal control procedures\nand re-evaluate our financial reporting. We may experience higher than anticipated operating expenses as well as outside auditor fees\nduring the implementation of these changes and thereafter. We may need to hire additional qualified employees in order for us to maintain\ncompliance with Section 404. During the course of documenting and testing our internal control procedures, in order to satisfy the requirements\nof Section 404(a), we may identify weaknesses and deficiencies in our internal control over financial reporting. For example, as previously\ndisclosed in our Annual Report on Form 20-F for the financial year ended February 28, 2025, material weaknesses were identified in relation\nto privileged user access and change management controls relating to certain of our systems as well as journal processing controls in\none of our subsidiaries as at February 28, 2025. During the financial year ended February 28, 2026, we implemented remediation measures\nand, based on our Section 404(a) assessment, our management concluded that, as at February 28, 2026, our internal control over financial\nreporting was effective. See Item 15 “Controls and Procedures.” If we fail, for any reason, to implement these changes effectively\nor efficiently, such failure could harm our operations, financial reporting or financial results and the trading price of our ordinary\nshares, expose us to increased risk of fraud or misuse of corporate assets, subject us to regulatory investigations and civil or criminal\nsanctions and could result in our conclusion that our internal control over financial reporting is not effective.\n\n \n\n41\n\n \n\n \n\n**Insiders\nhave substantial control over us and may have interests that are different from the interests of our other shareholders.**\n\n** **\n\nCertain\nof our major shareholders may have interests that are different from, or are in addition to, the interests of our other shareholders.\nIn particular, our Chief Executive Officer and certain of his affiliates may be deemed to beneficially own approximately 68.5% of outstanding\nshares as at May 29, 2026. For so long as such shareholders continue to own a significant percentage of our ordinary shares, they will\nbe able to significantly influence the composition of our board of directors and the approval of actions requiring shareholder approval\nthrough their voting power. Additionally, as a consequence of our “staggered” board of directors, as further described in"}