NASDAQ: CODA

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Our
imaging sonar series which is marketed under the name Echoscope®, Echoscope PIPE® and Echoscope PIPE NANO
Gen Series® are used primarily in the underwater construction, offshore renewables, and offshore oil and gas,
complex underwater mapping, salvage operations, dredging, bridge inspection, navigation of underwater hazard, port and harbor
security, ship hull scanning, mining, commercial and defense diving, robotics, autonomous underwater vehicle market, marine sciences
sectors and more broadly applications for real time 3D monitoring, inspection and visualization underwater. Uniquely, the
Echoscope® technology is a single sensor for multiple underwater applications that can be used to image in 3D, moving
objects in zero visibility water conditions. Competing technologies such as the multibeam is intended for mapping the seabed.
However, they are not designed for imaging moving objects.

Our
diving technology marketed under the name “CodaOctopus® DAVD” targets the global defense and commercial
diving markets. We have two variants of the DAVD, (the tethered and untethered variants). The tethered variant is used with a
connection to a surface vessel, and the untethered variant is not connected to a surface mothership for air supply. The target
market for the untethered variant is the military and special forces operations divers.

The
DAVD solution has the potential to radically change how diving operations are performed globally because it delivers real time information
simultaneously to the divers underwater and their surface-based dive supervisors. The DAVD Head- Up Display (“HUD”)
is used as a data portal for the diver while underwater. Various types of information are displayed to the diver in the HUD in real time,
thereby increasing the capability of the interaction between the diver and the
dive supervisor and therefore the overall effectiveness of the dive operations. When paired with our Echoscope® technology it forms a comprehensive solution
for diving in zero-visibility water conditions, which is one of the biggest challenges for diving operations.

The
DAVD untethered solution (“DUS”) is designed for the Defense and Military market where diving is performed without connection
to a surface vessel. These divers typically performs special forces operations, mine detection and clearance or
reconnaissance and surveillance. Similar to the tethered variant, the DAVD HUD is used for displaying a range of mission-related information
to the diver.

DAVD’s
concept of using a pair of glasses, which is capable of augmented reality display, inside the face mask, helmet or other diving suits
is protected by a patent. The Company has an exclusive license to exploit this utility patent.

The
Marine Technology Business operates through the Company’s wholly owned subsidiaries Coda Octopus Products, Inc., (Orlando), Coda
Octopus Products Ltd (UK), Coda Octopus Products A/S (Denmark).

Acoustics
Sensors and Materials Business

The
Company acquired Precision Acoustics Limited (PAL) on October 29, 2024. PAL is a supplier of acoustic sensors materials, and consultancy services in the field of acoustics. PAL serves
a broad base of markets such as the medical, subsea, defense, universities and research and development institutes. PAL also performs
calibration services for medical devices and is accredited to ISO/IEC 17025 standard. PAL is one of only two organizations in the United
Kingdom with this certification, alongside the National Physical Laboratory (NPL). Globally, only a handful of facilities hold ISO/IEC
17025 accreditation for these measurements. Ultrasonic free-field sensitivity calibration is critical for markets that require precision
ultrasonic measurement, strict safety compliance, and full metrological traceability. These include regulated and high-risk applications,
such as diagnostic and therapeutic medical ultrasound and defense and underwater acoustics, where free-field calibration is essential
to ensure accurate beam sensitivity and minimal interference. PAL’s operations are based in the United Kingdom.

Defense
Engineering Services Business (Services Segment)

Our
Defense Engineering Services Businesses are suppliers of embedded solutions and sub-assemblies which they design, manufacture and
sell as a component of mission critical integrated defense systems. The Defense Engineering Services Business established its
business in 1977 and has been supporting a number of significant defense programs for over 40 years, including
Raytheon’s Close in Weapon Support (CIWS) and Northrop Grumman’s Mine Hunting Systems Program (AQS-24). The
Defense Engineering Services business model entails engineering components for integration into broader defense programs, such as
the CIWS program. Typically, they are contracted to develop and supply prototypes units which are validated for broader integration
into these Defense programs and thereafter, subject to meeting the acceptance criteria, these lead to contracts for manufacture,
repair and upgrade for the life of the program, which can span decades. We enjoy sole source status for the parts that we design and
supply into these programs. This business model ensures recurring and long tail revenues. Coda Octopus Engineering, Inc. and Coda
Octopus Martech Ltd, qualify as small businesses. This opens opportunities under state requirements to collaborate with Prime
Defense Contractors on these programs. A significant part of the revenue generated by the Defense Engineering Services Business is
highly concentrated and is usually derived from a small number of prime defense contractors such as Raytheon, Northrop, Atlas
Electronics or Thales Underwater. In any one financial year, between 20% to 30% of our consolidated revenues may be derived from
these customers either alone or collectively.

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The
Defense Engineering Services Businesses operate through our wholly owned subsidiaries, Coda Octopus Engineering, Inc (“COEI”),
which is based in Salt Lake City, Utah and which we acquired in 2007, and Coda Octopus Martech Limited (“Martech”),
which is based in Portland, United Kingdom which we acquired in 2006.

Cross-Group
Synergies

Our Marine Technology business, PAL,
and the Defense Engineering Services Business operate as a fully integrated capability, combining shared customer relationships,
complementary technologies, and deep specialist engineering expertise. Together, they deliver end-to-end solutions in underwater
acoustics and measurement, supported by the design and manufacture of robust, ruggedized systems engineered for deployment in
demanding and hostile environments. These capabilities span the entire technology value chain, from acquisition and processing
through to computation, analysis, and visualization.

The Group increasingly operates on a
collaborative basis, with each business drawing on the strengths of the others to deliver complex customer programs and coordinated
responses to broader-scope tenders. Our Defense Engineering Services Business plays a central role in the Group’s growth
strategy, providing the engineering depth and systems expertise required to accelerate innovation and enhance the delivery of
technology solutions across the Marine Technology portfolio.

This integrated operating model enhances the Group’s control over intellectual property and reinforces its
competitive position. PAL’s recognized expertise in ultrasonic and acoustic measurement underpins the Group’s core technologies
and continues to shape the development and evolution of integrated, value-led solutions based on proprietary technology.

Key
Pillars for our Growth Plans

Our
volumetric real time 3D imaging sonar technology (the Echoscope® technology) and our DAVD are our most promising products
for the Company’s near-term growth.

The
Echoscope® is widely used in the commercial offshore marine market for a wide range of activities from real time 3D monitoring,
salvage and recovery, placements and landings, mining, etc. The biggest market opportunity for scalable growth around the Echoscope
is in the defense sector which is undergoing structural and transformational changes through the deployment of new classes of
underwater vehicles, including manned, unmanned surface, and fully autonomous platforms. These platforms vary in size, from large
vehicles exceeding 85 feet in length and weighing over 85 tons, to compact, one-person-deployable systems. A common requirement
across all platforms is the need for reliable underwater vision. This capability is essential for safe and accurate navigation,
situational awareness, environmental understanding, data collection, and mission execution. The Echoscope directly addresses these
needs by providing high-resolution, real-time 3D imaging in complex underwater environments. The defense sector deploys these
underwater vehicles for a range of mission-critical applications, most notably Mine Countermeasures, Anti-Submarine Warfare,
Surveillance and Reconnaissance, and Infrastructure Protection (such as undersea cables). The Echoscope is currently being evaluated for integration into
active future defense programs.

All
next-generation defense vehicle programs share a common objective of integrating advanced technologies and enhanced capabilities.
Central to this evolution is the development of smarter vehicles equipped with tools like the Echoscope® which deliver
real-time, three-dimensional data (live XYZ data) for informed real time decision-making. Its versatility across a wide range of
defense mission applications supports the consolidation of sensor suite requirements on these platforms. A key advantage lies in
addressing SWaP (Size, Weight, and Power) constraints. With the potential to reduce the number of active sensors on these platforms
the Echoscope offers the opportunity to lower power consumption and overall vehicle weight and directly contributing to extended
mission durations. This capability represents a unique and valuable benefit which the Echoscope brings to the defense underwater
vehicles programs.

The
launch by the Company of its Echoscope PIPE NANO Gen Series® in fiscal year 2025, our ultra-compact real time 3D imaging sonar
marks a critical step in enabling next-generation subsea AI enabled autonomy. As the subsea industry transitions from vessel-intensive,
human -in-the-loop workflows, NANO Gen Series provides the real time 3D perception required to unlock scalable, software driven
autonomy across a growing range of platforms. It functions as a core perception sensor for AI-enabled platforms, supporting navigation,
obstacle avoidance, target recognition and guidance and adaptive mission execution with reliance on bandwidth limited communications
or post-processing capability. The introduction of our NANO Gen Series which is a shade bigger
than a smartphone, is a significant leap forward as it positions the Company to address a broad swathe of the underwater vehicle
market, where these vehicles are increasingly becoming smaller. With the introduction of our NANO Gen sonar series in fiscal year
2025 we saw real progress in the Defense underwater vehicle market and have had several key and successful trials with the new NANO
sonar as it is aligned with the strongest growth drivers in the subsea market for autonomy, Edge AI, reduced operational costs and
scalable deployment. By enabling higher levels of autonomy and mission efficiency in a single, compact sensor, NANO Gen Series strengthens
the Echoscope’s role as a critical sensor to the next generation of intelligent subsea platforms.

We
also believe that the DAVD system, which is a relatively new technology and presents significant capabilities to the diving market, is
poised to radically change the way diving operations are performed globally by providing a fully integrated suite of sensor data shared
in real time by the diver and the dive supervisor on the surface. Current diving is done largely by voice command missions from the topside
using disparate suite of systems for video data, communications, and positioning.

The
DAVD tethered variant is now a commercial offering and is in the early stages of adoption with the US Navy in over 14 commands. We continue
to work to achieve adoption in the global market.

The
DAVD untethered solution (DUS) presents the biggest market opportunity for DAVD technology. In the USA alone there are over 14,000
divers that could utilize this solution including U.S. Special Operations Forces (SOF), EOD (Explosive Ordnance Disposal), US Army,
Marine Corps, US Coast Guard, first responders and law enforcement.

In the Fiscal Year 2024, the DAVD untethered solution was the subject of a joint
funded U.S and Foreign Navy program, the DUS Hardening Program, under which the DAVD technology was adapted and hardened for SOF
applications. During the fiscal year 2024 we made significant progress by delivering major project deliverables such as a new
generation head up display (DAVD HUD), which is in a much smaller form factor and higher resolution. Following the successful
completion of the DUS Hardening Program, we made further progress during the fiscal year 2025 when we received the first production
order for the untethered variant and delivered 16 DAVD Untethered Systems for the U.S Navy MK16 Rebreather system. These are the culmination of extensive field testing and direct feedback from operational divers. The production unit is now undergoing
final approval for Authorization for Navy Use (ANU). This is an essential approval process which permits the system to be used in live
operation. We also delivered all program
deliverables under the DUS Hardening Program to a foreign navy sponsor including training on the DUS, which now enables
this navy to move to the next stage of their evaluation by introducing this technology to their internal users. In the 2025 FY
we also received our first small batch order for DAVD system from a very influential European-based foreign navy, and we are contracted to
provide training in our second quarter of fiscal 2026 to this navy.

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The
concept of utilizing a pair of transparent glasses in the HUD underwater for this purpose, is protected by patent. All component parts
of the DAVD system are proprietary to the Company and include software (4G USE® DAVD Edition), Diver Processing Pack –
telemetry system (DPP), topside Supervisor Console Controller and real time 3D Sonar. The Company benefits from the exclusive license
from the U.S. Department of the Navy at Naval Surface Warfare Center Panama City Division to utilize the utility patent covering the
concept of using the pair of transparent glasses as a data hub underwater. The DAVD tethered variant is classified as an “Authorization
for Navy Use” item and also benefits from CE marking certifying that the DAVD system meets the essential health, safety and environmental
requirements of the UK and European Union. The untethered variant is currently going through validation process.

Our
corporate structure is as follows:

Corporate
History

The
Company began as Coda Technologies Limited. This company now operates under the name Coda Octopus Products Limited, a United Kingdom
corporation formed in 1994 as a start-up company with its origins as a research group at Heriot-Watt University, Edinburgh, Scotland.
Initially, its operations consisted primarily of developing software for subsea mapping and visualization using sidescan sonar (a technology
widely used in commercial offshore geophysical survey and naval mine-hunting to detect objects on, and textures of, the surface of the
seabed).

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In
June 2002, we acquired Octopus Marine Systems Ltd, a UK corporation, and changed our name to Coda Octopus Limited. At the time of its
acquisition, Octopus Marine Systems was producing geophysical products broadly similar to those of Coda, but targeted at the less sophisticated,
easy-to-use, “workhorse” market.

In
December 2002, Coda Octopus Ltd acquired OmniTech AS, a Norwegian corporation, which became a wholly owned subsidiary of the Company,
and which subsequently changed its name to Coda Octopus R&D A/S. At the time of acquisition, this company had been engaged for over
ten years in developing a revolutionary imaging sonar technology capable of producing real time three-dimensional (“3D”)
underwater images for use in subsea activities. Coda Octopus Products Limited (Edinburgh based) then developed our visualization software
(Underwater Survey Explorer) to control and display the images from the real time 3D sonar device. This technology is now marketed by
us under the brand name “Echoscope®”, Echoscope PIPE® and Echoscope PIPE NANO
Gen Series®. All activities of this now-defunct Norwegian subsidiary, Coda Octopus R&D A/S, have been transferred
to Coda Octopus Products Limited (Edinburgh).

On
July 13, 2004, the Company effected a reverse merger pursuant to the terms of a share exchange agreement between The Panda Project, Inc.
(“Panda”), a Florida corporation, and a now defunct entity affiliated with Coda Octopus Ltd. (“Coda Parent”).
Panda acquired the shares of Coda Octopus Limited, a UK corporation and a wholly owned subsidiary of Coda Parent, in consideration for
the issuance of a total of 1,432,143 shares of common stock to Coda Parent and other shareholders of Coda Octopus Limited. The shares
issued represented approximately 90.9% of the issued and outstanding shares of Panda. The share exchange was accounted for as a reverse
acquisition of Panda by Coda. Subsequently, Panda was reincorporated in Delaware and changed its name to Coda Octopus Group, Inc.

In
June 2006, the Company acquired Coda Octopus Martech Limited (“Martech”), which is part of our Defense Engineering Services Business. This is an English corporation.

In
April 2007, the Company acquired Coda Octopus Engineering, Inc. (“COEI”), formerly known as Colmek
Inc., which is part of our Defense Engineering Services Business. This is a Utah corporation.

In
December 2013 Coda Octopus Products Limited established Coda Octopus Products Pty Ltd (Australia) to grow our presence in Australia and
New Zealand. These activities were interrupted by the Coronavirus Pandemic in 2020 and since then we have not had personnel on the ground
and therefore these operations have been slow to regain momentum.

On
October 29, 2024, we acquired into the Group, Precision Acoustics Limited - “PAL” - a company established under the laws
of England. This company was acquired to gain access to its expertise and expand our capabilities and offering to the market. It was
also acquired to leverage its existing technologies and expertise, which are used in other market sectors, into one of our main markets,
the subsea market.

Coda
Octopus Group, Inc., is organized under the laws of the State of Delaware as a holding company that conducts its business through its
subsidiaries, several of which are organized under the laws of foreign jurisdictions, including England, Scotland, Denmark, Australia
and India. This may have an adverse impact on the ability of U.S. investors to enforce a judgment obtained in U.S. courts against these
entities, or to effect service of process on the officers and directors managing the foreign subsidiaries. These companies’ operations
must comply with the laws of the countries under which they are incorporated, and these laws are likely to be different from the equivalent
laws of the United States.

Corporate Information

Our principal executive offices are located at 3300
S. Hiawassee Rd, Orlando, FL 32835. Our telephone number is +1 (407) 735-2406. We maintain a corporate website at www.codaoctopusgroup.com.
The reference to the Company’s website address does not constitute incorporation by reference of the information on the Company’s
website into this Form 10-K.

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Marine
Technology Business (“Products Segment”)

Our
Marine Technology Business develops proprietary solutions for both the commercial and defense subsea market. The range of solutions which
it offers to the market are complementary and include:

Product

Family

Composition

Real
time volumetric imaging sonar

Echoscope®/
Echoscope PIPE® range, Echoscope PIPE NANO Gen Series® range

Hardware
and Software

Diving
Technology

DAVD range

Hardware
and Software

Digital
Audio Communications System

Voice
HUB_4

Hardware
and Software

GNSS-Aided
Navigation Systems (providing heading, pitch, yaw and roll data at sea)

F280
Series®

Hardware
and Software

Geophysical
Solutions

(used
in conjunction with sidescan and sub-bottom data acquisition)

DA4G®,
GeoSurvey® and Survey Engine

Hardware
and software

These
products and/or solutions are sold, rented or leased into various marine sectors such as:

●
Marine
geophysical survey

●
Offshore
Renewables (“Wind Energy”)

●
Underwater
construction, inspection and monitoring

●
Diving
Companies

●
Commercial
and Defense Diving

●
Salvage
and decommissioning

●
Oil
and Gas (O&G”)

●
Robotics

●
Autonomous underwater vehicles

●
Commercial
fisheries

●
Environmental,
mammal and habitat monitoring

●
Underwater
Defense Applications

●
Underwater
vehicles

●
Port
and Harbor Security, law enforcement and first responders

●
Research
and education

1.
Geophysical Range of Products

The
Geophysical range of products is marketed under the brands DA4G®, GeoSurvey® and Survey Engine®.
We started our business in 1994 designing and developing the GeoSurvey® software and hardware package for acquisition
and processing of sidescan sonar and sub-bottom profiler data. For over two decades, our GeoSurvey has been an industry leading software
package in the market for data acquisition and interpretation and provides feature rich solutions and productivity enhancing tools for
the most exacting survey requirements. Designed specifically for sidescan and sub-bottom data acquisition, GeoSurvey®
has been purchased by numerous leading survey companies throughout the world and has been the workhorse for processing data for Oil &
Gas companies for many years. DA4G is a hardware acquisition system and both GeoSurvey® and Survey Engine®
are complementary software packages which are used for processing the data post-acquisition.

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2.
Inertial Positioning and Attitude Measurement Systems (“Motion Products”)

We
have been selling our GNSS Aided Inertial Measurement Systems for over 20 years. Our current generation of F280 Series® was
released to the market in 2021 and is used to provide data on accurate positioning, heading, pitch, roll and yaw at sea. The F280 Series®
is an advancement of our F180® series and is highly complementary to our real time Echoscope® sonar
series and they are packaged together to provide a more comprehensive solution. The products within the F280 Series ® range
can be sold with or without our Echoscope®.

3.
Real Time Volumetric Imaging Sonars (ranging from 3D/4D, 5D and 6D)

We
design, develop and supply what we believe is the world’s most advanced series of real time volumetric imaging sonar (Echoscope®,
Echoscope PIPE® and recently added Echoscope PIPE® NANO Gen Series). This is the culmination of over 25 years of research
and development. Our sonar innovations are multi-tiered and extend to hardware, firmware and software, all of which co-exist and are
co-dependent on each other. In other words, hardware, firmware and software operate as sub-systems to each other. We believe that the
highly complex nature of this new technology will make it extremely difficult to reverse engineer our sonar products.

Prior
to 2018, we were selling our third generation of Echoscope imaging sonar (3G Sonar Series which were of limited application due to size, weight, power and price (SWAPs)). In January 2018, we launched our 4G
Sonar Series which were largely form factor revisions, and removed the SWAPs issues.
Building on our 4G developments, we continued our innovation and in 2021 released our latest generation of sonar, Echoscope
PIPE® to the market which advanced the capabilities of the technology and antecedent sonar products significantly. We
continued investing in our Echoscope Technology and in 2025 based on our breakthrough technology chip set, we were able to introduce
our new Echoscope PIPE NANO Gen Series® which is significantly reduced in form factor (a shade bigger than
smartphones) and further opens the opportunities for our technology in the small underwater vehicles space, drones and
robotics and platforms designed for autonomy and AI driven requirements.

We
believe that the Echoscope PIPE® technology is superior to the other imaging sonars in the market as it generates real
time 3D, 4D, 5D and 6D images of the underwater environment irrespective of low or zero visibility conditions and, unlike conventional
sonars, can image a volume of data (as opposed to a slice of data). The capability of our volumetric imaging sonars covers a broad breadth
of activities underwater particularly for any form of real time monitoring in 3D, underwater construction, salvaging, placements, decommissioning,
obstacle avoidance, complex underwater mapping and real time 3D navigation in zero visibility conditions. Uniquely also, using a single
sensor (our Echoscope PIPE®) range we can provide different data outputs to the various parts of the survey team, thus
reducing the number of different sensors required on these underwater projects, and ultimately reducing the costs associated with these
operations.

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About
the Company’s 5D and 6D PIPE Sonars Innovations

The
acronym PIPE stands for Parallel Intelligent Processing Engine.

5D
and 6D imaging sonars are new to the subsea market and constitute an innovation by the Company.

5D
Sonars (Echoscope PIPE®)

The
Company’s 5D Sonars is capable of processing and utilizing much more of the data that is acquired and processed by our latest
PIPE volumetric imaging sonars. Prior to this, due to limitation of processing technologies, there was an upper limit to the amount
of data our antecedent sonars could acquire and process. This meant that in the previous generation of sonars (3G and 4G series)
when a signal was emitted, they returned a single range and intensity value per beam. In our 5D Sonars we return multiple range and
intensity values per beam (Full Time Series data). This new capability provides more information about the underwater
environment.

6D
Sonars (Echoscope PIPE®)

The
Company’s 6D Sonars process and utilize much more of the data acquired by the sonar. 6D Sonars generate multiple real time 3D full
time series images. The latest
PIPE technology generates multiple 3D images simultaneously in real time using different sonar/acoustic parameters (such as different
beamforming methods, frequency, range, field of view, pulse length and other acoustic filters or shading). This allows for different
data sets to be provided to different parts of the survey team in real time (thus consolidating the sensors and the associated costs
and effectiveness of the solution). We are not aware of any sonar that offers either 5D or 6D Capability.

Echoscope
PIPE NANO Gen Series®

The
Company’s NANO Gen Series sonars were introduced during third fiscal quarter of 2025. The NANO Gen Series is
pivotal for the Company as it addresses the small underwater vehicles, drones, autonomous and robotics platforms which is a growing
part of the underwater vehicles market – where these are getting increasingly smaller. The biggest market opportunity for our
scalable growth around the Echoscope is in the defense sector which is undergoing a major transformation through the deployment of
new classes of underwater vehicles, including manned, unmanned surface, and fully autonomous platforms which are becoming
increasingly small. The introduction of NANO is important as it positions the Company to address a broader swathe of
the imaging sonar market. We believe our NANO Gen Series is aligned with the strongest growth drivers in the subsea market by
enabling higher levels of autonomy and mission efficiency with a single ultra compact sensor supporting multiple high-value use
cases including subsea navigation, inspection, 3D modeling, 3D perception, seabed imaging and change detection and therefore
allowing operators to consolidate hardware, reduce integration complexity and lower the total system cost. This multi-mission
flexibility positions NANO Gen Series as a platform-agnostic technology for AUVs, ROVs, hybrid vehicles, resident subsea systems and
future autonomous fleets.

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Echoscope®
Software

The
Echoscope® technology is used in conjunction with our internally developed software (USE, Construction Monitoring System (CMS), 4G
USE®, 4G USE® DAVD Edition and 4G USE® DAVD Flex Edition). The software
is a critical component of the capabilities and features of our sonar series.

Our
software development capability is an important part of our strategy to maintain our lead in designing, manufacturing, and selling
state-of-the-art real-time volumetric imaging sonars and our DAVD System. It also allows us to be responsive to our
customers’ requirements for new features and capabilities around our solutions.

We
have now launched our fourth-generation multi-sensor software platform which is marketed under the name “4G USE®”,
which is a multi-sensor platform allowing users to bring in and utilize a variety of sensor data including sonar, positioning, camera,
lidar, video processing and other sources of point cloud data and seamlessly merging above and below the water data captured from the
sonar and camera. It is also the platform for our DAVD software, and this module is marketed under the brands 4G USE®
DAVD Edition and 4G USE® DAVD Flex Edition and our new 4G USE® Obstacle Detection/Avoidance software.

Diver
Augmented Vision Display (DAVD) System – Diving Technology

Funded
by the Office of Naval Research (“ONR”) through its Future Naval Capabilities (FNC) program, and in close collaboration
with NAVSEA 00C3 and Naval Surface Warfare Center, Panama City Division (“NSWC PCD”) we have developed a cutting-edge
Augmented Reality (AR) technology (DAVD), purpose-built product to enhance diver safety, performance and situational awareness in
low-visibility and technically demanding underwater environments.

DAVD
is a complete end-to-end diver management solution incorporating as a key element a high-resolution, fully transparent glass head-up
display (“DAVD HUD”), integrated directly inside the diving helmet (for hard hat surface air supply diving) or full-facemask
(for tethered and untethered defense, commercial and recreational diving applications) or diving suits.

Problem
In Context

The
concept of using a pair of transparent glasses in the HUD to render real time information for underwater applications is protected by
patent and Coda Octopus has an exclusive license from United States Department of the Navy at NSWC PCD to exploit this patent for all
underwater diving activities.

The
US Government, as represented by Secretary of the Navy (Arlington, VA), describes the challenge for divers in an abstract from their
patent application as follows:

“By
their very nature, underwater dive missions are difficult and inherently dangerous. Furthermore, the complexity of underwater missions
can make it difficult or impossible for a diver to retain all pre-mission briefing information. For these reasons, it is critical for
underwater divers to have access to environmental data and mission data while in the water. However, in low visibility water environments,
divers can rarely see handheld displays or gauges. Accordingly, divers are generally supplied with audio-communicated information from
a topside location. The topside-supplied information can include descriptions of sonar images, blueprints, maps, pictures, etc. Unfortunately,
it can be very difficult and confusing for a diver to interpret a topside personnel’s audio description of the topside personnel’s
visual interpretation. Combining this with unreliable audio communication can lead to mission failures or disasters.”

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It
further describes the objective of the Invention as:

“Accordingly,
it is an object of the present invention to provide an underwater diver with real-time visual information available to topside personnel.

Another
object of the present invention is to provide real-time visual information to an underwater diver for viewing in water environments irrespective
of water visibility levels.

Other
objects and advantages of the present invention will become more obvious hereinafter in the specification and drawings.”

How
does DAVD Change this?

The
DAVD system addresses all the challenges described above including removing the interpretation of the underwater scene to the topside
by providing the diver with real time data and first-person interpretation. The DAVD technology benefits not only the diver and direct
supervisor on the surface, but also engineers, end-clients, rescue workers and support personnel who all have a vested interest in a
successful and safe diving mission. DAVD provides the location of the diver, the dive support vessel, work site assets and any hazards
that are known or discovered in real-time. Real-time compass and depth are also displayed to the diver to reduce disorientation. Visibility
for the diver and team is significantly enhanced with both real-time camera and 3D sonar data (providing underwater night-vision) and
also high-resolution maps and models of the entire work site and surroundings. Communication is transformed from low quality audio speech
to high quality digital audio and video, text messaging, visual alerts and automated navigation guidance. The safety of the diver and
team is paramount. DAVD ensures the Diver and Supervisor are visually synchronized and can safely coordinate movement, tasks and instructions
with full health monitoring and logging of the entire mission. Using the current method of diving, data and information sharing end when
the diver leaves the surface.

The
DAVD solution is currently in early-stage adoption with the US Navy and enjoys the benefit of the classification Authorization for
Navy Use (ANU) item for the Tethered variant. DAVD also is certified for CE markings which covers compliance with the European Union and the United Kingdom
health environmental and health and safety requirements.

We
continue to evolve the DAVD technology. We delivered the new generation of DAVD HUD at the end of fiscal year 2024 and following the
completion of the DUS Hardening Program, which funded the adaptation of the DAVD technology for the special forces sector, we delivered
16 DUS new generation systems which are now the subject of evaluation for broader adoption by this community of users.

During
fiscal 2025 we received contracts for several funded programs for the incorporation of the DAVD technology into diving
apparatus including diving masks and diving suits including DSEND (Deep Sea Expeditionary with No Compression System). DAVD is being leveraged as a critical life support and visualization component, enhancing diver safety and mission effectiveness by delivering
real time life support data via the DAVD HUD and 3D situational awareness through Echoscope technology. These initiatives exemplify the
growing recognition of DAVD and Echoscope technologies as mission-critical tools in the evolving landscape of advanced military diving
and underwater operations.

Marine
Technology Business Accreditations

Coda
Octopus Products Limited has the requisite accreditations for its business including being Lloyds Register accredited to ISO 9001:2015
and Cyber Essentials Plus certification.

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Acoustic
and Materials Business (Precision Acoustics Limited (“PAL”))

PAL is a recognized leader in the ultrasound and acoustic
measurement field. Specializing in acoustic hydrophone design and innovative acoustic materials, they provide a comprehensive range of
products and solutions, with a primary focus on medical imaging and Non-Destructive Testing (NDT). NDT is used to validate the viability
of structures such as aircraft, ship hulls, wellheads and other subsea structures. Their expertise extends to working closely with national
and global standard-setting bodies (such as the National Physical Laboratory of the UK), contributing to the establishment of the primary
measurement standards in the industry. PAL also performs calibration services for medical devices and is accredited to ISO/IEC 17025
standard. PAL is one of only two organizations in the United Kingdom with this certification, alongside the National Physical Laboratory
(NPL). Globally, only a handful of facilities hold ISO/IEC 17025 accreditation for these measurements. Ultrasonic free-field sensitivity
calibration is critical for markets that require precision ultrasonic measurement, strict safety compliance, and full metrological traceability.
These include regulated and high-risk applications, such as diagnostic and therapeutic medical ultrasound and defense and underwater
acoustics, where free-field calibration is essential to ensure accurate beam sensitivity and minimal interference.

PAL
has the requisite accreditations for its business including being Lloyds Register accredited to ISO 9001:2015 and Cyber Essentials Plus
certification and ISO/IEC 17025 covering ultrasonic hydrophone calibration capabilities—specifically in Ultrasonic Free-Field Sensitivity.

Defense Engineering Services Businesses (“Services Segment”)

Our
Defense Engineering Services Businesses comprise Coda Octopus Engineering, Inc. (“COEI”) which is based in Salt Lake City and Coda
Octopus Martech Limited which is based in Portland, UK.

They
largely operate as sub-contractors to prime defense contractors, and their engineering solutions typically constitute sub-components
designed for integration into larger defense programs of record where high levels of reliability and quality are essential pre-requisites
for securing and maintaining these agreements with their customers. Typically, they prototype subassemblies for their customers and after
going through various acceptance tests, including first article inspection approvals, they are then awarded the manufacturing contracts.
Many of these manufacturing contracts have a repeat orders profile which typically follows the life cycle of the defense program that
is using the subassembly component within the broader program.

These
arrangements often give the Defense Engineering Services Businesses long term preferred/sole supplier status for the sub-components they supply
into these programs and provide them with opportunity to participate in any requirements for technology refresh or obsolescence
management for the components supplied. They generally use these long-standing relationships to win more contracts with these
customers.

In
order to grow, the Defense Engineering Business relies on increasing the number of new programs it attracts annually. In
addition, we are increasingly combining our engineering capabilities with our product offerings. This enables us to offer systems
which are complete with installation and support to maximize the utilization of our collective expertise to advance our
technologies.

Coda
Octopus Martech Limited (“Martech”)

Martech,
which is UK-based, operates in the specialized niche of bespoke design and manufacturing services mainly to the United Kingdom defense
and subsea industries. Its services are provided on a custom subcontract basis where high quality and high integrity devices are required
in small quantities. Their skill set includes both hardware and software design.

Martech
enjoys pre-approvals to allow it to be short-listed for certain types of government contracts. Much of the more significant business
secured by Martech is through the formal government or government contractor tendering process. Martech has the requisite accreditations
for its business including being Lloyds Register accredited to ISO 9001:2015 and Cyber Essentials Plus certification.

14

Coda
Octopus Engineering, Inc. (“COEI”)

COEI, which is US-based, is a supplier of embedded solutions and sub-assemblies which they design and manufacture and sell into mission critical integrated
defense systems such as the Close-In-Weapons System (CIWS). This business was established 1977 and has been supporting several
significant US defense programs for over 45 years, including Raytheon’s CIWS and Northrop Grumman’s Mine Hunting Systems
Program (AQS-24). This business was at the heart of technology for search and recovery of the Titanic in 1985 with its long-range
telemetry system for underwater instrumentation. COEI’s business model entails designing sub-assemblies which are components
of broader defense programs. COEI is the sole source for the hardware and software components that they supply to these programs.
This business model ensures recurring and long tail revenues since we continue to supply parts, typically for the life of the
program, which can span decades. Their work scope typically extends to both hardware and software design.

COEI
has the requisite accreditations for its business, including being Lloyds Register accredited to ISO 9001:2015 and NIST (National Institute
of Science and Technology) 800-171 certification.

Sales
and Marketing

The
Marine Technology Business markets its products through its internal sales team, website, industry events such as trade shows, webinars,
live demonstrations of the technology, industry relationships and a network of non-exclusive agents in foreign countries such as Japan,
China, Korea and South Africa.

PAL
markets its products through its internal sales team, its website and a network of non-exclusive agents in Japan, China, India and Korea.

COEI
markets its products through its internal sales team, website, industry events and a network of non-exclusive agents in the US and
Canada.

Martech
markets its products through its internal sales team, website and industry events.

Competition

Marine
Technology Business

In
our Marine Technology Business, we are exposed to the following competitive challenges:

15

Real
Time 3D/4D/5D and 6D Volumetric Sonar (Echoscope® Technology)

A
significant portion of our revenue is generated from our Echoscope® technology.

Within
the domain of real-time 3D imaging, we are aware of only a single recent entrant to the market: WaterLinked AS. The specific capabilities
and intended applications of their sonar system remain uncertain; however, publicly available datasheets indicate that it is designed
solely as an acoustic camera with a notably limited imaging range and crucially limited resolution. Consequently, the product appears
to offer limited performance and remains at a nascent stage of technological development.

Entry into this market depends upon specialized marine electronics, acoustic, know-how, and software development skills. The learning curve, which
has resulted in the advancement of our real time 3D sonar device, is the culmination of two decades of research and development in this
field.

Companies
such as Kongsberg Gruppen, R2Sonic, LLC, Tritech International Ltd., United Kingdom, BlueView Technologies Inc., USA (now a part of Teledyne
Technologies Incorporated), and Norbit Group AS Norway and Kraken Robotics are examples of companies offering imaging sonar solutions
(such as multibeam sonars, SAS sonars and/or 2D scanning sonars), but none of these sonar offerings are directly comparable or competitors
to our real time volumetric 3D/4D/5D and 6D sonar solutions as their scanning sonar, single beam or multibeam sonars are not real time
3D imaging sonars and therefore cannot image moving targets underwater.

Specifically,
we believe that they do not have the same capabilities as our Echoscope® technology in terms of real time inspection
and monitoring by generating 3D, 4D, 5D and 6D images of moving objects underwater including in environments in low or zero
visibility conditions. Notwithstanding it should be noted that Teledyne has acquired a significant number of substantial subsea
companies (examples are Reson and BlueView). Teledyne has much greater resources, liquidity and market reach than our Company and
has many operating verticals. We therefore can give no assurance that companies such as these will not enter this market.
Furthermore, companies such as Kongsberg Gruppen and Teledyne can expend significantly more in any one fiscal year on R&D and
Business Development, key pillars for increasing market share of underwater imaging sonars, than the Company. Notwithstanding, we
believe that our recent development and introduction of 5D/6D - Echoscope PIPE® sonar capability in conjunction with
our software (4G USE® a multi-sensor platform) further distinguishes our volumetric sonars and significantly extends
our lead in real time 3D/4D/5D and 6D Imaging of moving objects underwater over competitors in the subsea imaging market.
Furthermore, we believe that the addition of Precision Acoustic’s expertise in this area will help the Company in maintaining
its lead in this area. We are not aware of any other imaging sonars in the market capable of generating real time 5D and 6D imagery
underwater, which are Coda Octopus inventions. The innovations around Echoscope PIPE® are the subject of numerous
patent applications. We have been awarded US 10,718,865 and US 10,816,652 patents which concerns a method of compressing beamformed
data and method of compressing sonar data, respectively. These two patents are important “method patents” since we are
handling significantly more data than in our previous generation of sonars.

16

We
seek to compete on the basis of producing high quality products employing cutting edge technology that is easy to use by the operators
without specialized skills in sonar technology. We intend to continue our research and development activities to continually improve
our products, seek new applications for our existing products, develop new innovative products and grow the market for our products and
expertise.

Diver
Augmented Vision Display System (“DAVD”)

A
material portion of our revenue is generated from our DAVD technology.

There
are various diving systems in the market that provide a combination of different aspects of our DAVD system but no systems that directly
compete in the form of embedded fully transparent glasses mounted internally within the diver helmet or mask for visual display of a
range of data and augmented reality information which can be directly consumed by the diver underwater. This concept is protected by
US Patent 10,877,282.

The
DAVD system provides a unique diver centric system with localized and external sensors to provide increased safety, scene awareness and
vital communication in the form of Digital Audio, Ultra-Low-Light Video, Text and technical instruction and access to a complete media
hub for effective communication between diver and supervisor. The DAVD system provides the following capabilities:

●
Fully
Transparent High-Definition HUD mounted internally within supported Dive Helmets and Dive Masks, including Kirby Morgan KM37, KM37SS,
KM97 and SL17 Helmets, as well as the Interspiro Divator MK II, OTS Guardian and Dräger Panorama Nova Dive, Diveways and DSENDs.

●
Fully
integrated 1st person perspective digital low-light camera with advanced video processing and real-time edge enhancement for Diver
and Dive Supervisor

●
Fully
integrated noise-cancelling Digital Audio at source, replacing legacy communications

●
Integrated
Diver Head Tracking for accurate 3D scene visualization with full support for subsea positioning systems for accurate Diver positioning

●
Telemetry
Information on demand including Dive Timers, Depth and Compass Heading, Live position Lat/Long (when connected to external diving
positioning system), Waypoint Range and Bearing as well as external Dive Computer data

●
Instant
Digital Voice and Text Communication between Dive Supervisor and Diver, including auto and pre-defined messaging

●
Transmit
unlimited on-demand media to Diver including Images, Instructional Videos, Technical Drawings and other assets to assist in live
operations

●
Creation
and transfer of unlimited step-by-step mission instructions with text, video and image support for common diver tasks and operations

●
Full
Mixed-Reality 3D Display for Diver using live Sonar, pre-surveyed Sonar data and 3D models

●
Divers
HUD Display fully adjustable between 2D Mode, and 3D Mode with 1st person and 3rd person perspective

There
are several diver related products and sensors that can be worn by the diver such as telemetry systems, navigational aids, dive computers,
video and sonar systems and probes and sensors such as magnetic and thickness. Each of these systems typically have an independent display,
typically on the device or wrist worn.

Video
systems generally provide no direct benefit to the diver and are intended for top-side visualization. The DAVD provides video data
directly to the diver.

More
recent advances in technology have introduced head mounted display (HMD) as either replacement or as additional display close to the
divers’ eyes. These are typically presented in the form of a monocular display mounted externally to the divers’ mask in
which the diver must look at this display through a single eye. These are not intended for long term use and are more for occasional
glance at data for reference. Dual HMDs are also provided in certain products to replace what the diver can see through the mask
with a computer display.

17

The
drawback of such HMD is that the diver loses all sense of the natural surrounding and the real environment is placed using the computer
display. Examples of monocular and dual lens HMD include Shearwater Nerd 2, Tritech DMD (Diver Mounted Display) and Blueprint Subsea
Artemis HMD.

Furthermore,
a significant challenge for diving is the operating environment where zero visibility conditions typically prevail. Combining our DAVD
with our Echoscope® removes this barrier for diving operations.

Acoustic
Sensors and Materials Business

PAL
sells several products, some of which are customized for the customer’s specific application. It is exposed to the following competitive
challenges:

Needle
and Membrane Hydrophones and Fibre-Optic Hydrophones Market.

For
its needle and membrane hydrophone ranges, which are a highly specialized range of products, competition is limited. The principal competitors
offering both needle and membrane hydrophones are Onda Corporation, Sunnyvale, CA, USA and Gampt, Merseberg, Germany. For its fibre-optic
hydrophones range of products, its main competitors are Onda Corporation, Sunnyvale, CA, USA, RP Acoustics, Stuttgart, Germany and Muller
Instruments, Oberursel, Germany.

Single
element Transducers Market

PAL
supplies single element transducers. There are many suppliers of ultrasonic transducers including Olympus, USA, Imasonic, Besancon, France;
Vermon, France; Sonatest, UK; Waygate Technologies, USA as well as numerous smaller organizations in China. However, these competitors
offer commercial-off-the-shelf (COTs) products whereas PAL offers custom design single element transducers based on its customers’
specifications and therefore competition is limited for this specialist customization capability.

Automated
Measurement Systems Market

PAL
supplies Automated Measurement Systems. Its main competitors in this area are Onda Corporation, Sunnyvale, CA, USA; Acertara Acoustic
Laboratories, Longmont, CO, USA and Gampt, Merseberg, Germany. These companies offer acoustic measurement systems which are comparable
with the PA UMS system. However, PAL faces less competition for its Automated Measurement Systems since its focus is on customization
to their customers’ specifications.

Passive
Acoustic materials Market

PAL
supplies passive acoustic materials. Competition is limited as it has a license from the UK National Physical Laboratory to distribute
a wide range of ultrasonic absorbers and encapsulants incorporating NPL’s intellectual property.

Measurements
and Calibration Market

As
a provider of measurements and calibration services in the UK, PAL’s main competitor is National Physical Laboratory (NPL), UK
who is the only provider of ISO17025 accredited hydrophone calibration services, in addition to the ultrasonic power calibration service.
They also provide ultrasonic and underwater acoustic field characterization services. However, there is a long-established collaboration
between PAL and NPL, and both organizations act as supplier and customer of each other. Elsewhere, numerous notified bodies or national
measurement institutions (TuV, Germany; SGS, France; GUM Poland; PTB, Germany) offer some specific measurement services.

Defense
Engineering Services Businesses

COEI and Martech compete with larger
contractors, such as the primes, in the defense industry. Typical among these are Ultra Electronics, Atlas, BAE Systems, Thales Underwater,
Raytheon and Northrop Grumman, all of whom are also partners on various projects. The strongest competitors are often the prime contractors
themselves as they predominantly have the option to execute the work package internally as opposed to subcontracting with us.

Intellectual
Property

We
operate in an industry in which innovation, investment in new ideas and protection of our intellectual property rights are critical for
our continued success. When we can, we protect our innovations and inventions through a variety of means, including, but not limited
to, applying for patent, copyright, and trademark protection domestically and internationally, and protecting our trade secrets. We incentivize
our employees to innovate through our Patent Reward Scheme.

Patents

Our
patented inventions along with our strategy to enhance these inventions are at the heart of the Company’s strategy for growth and
development. We expend a material part of our resources in building our Patent Portfolio. We also incentivize our staff to contribute
to our Patent Portfolio by having in place a competitive Patent Reward Scheme.

18

Our
patent portfolio consists of the following:

Patent
No.

Description

Expiration
Date

US
7,466,628

Concerns
a method of constructing mathematical representations of objects from reflected sonar signals

January
1, 2027

US
7,489,592

Concerns
a method of automatically performing a patch test for a sonar system, where data from a plurality of overlapping three-dimensional
(3D) sonar scans of a surface, as the platform is moved, are used to compensate for biases in mounting the sonar system on the platform

March
5, 2027

US
7,898,902

Concerns
a method of representation of sonar images allowing 3D sonar data to be represented by a two-dimensional image

June
13, 2028

US
8,059,486

Concerns
a method of rendering volume representation of sonar images.

April
16, 2028

Japan
5565964

Concerns
a method for drilling/levelling by an underwater drilling/levelling construction device

January
13, 2031

Japan
5565957

Concerns
a method of construction management for a 3D sonar device

October
13, 2030

US
8,854,920

Concerns
a method of volumetric rendering of 3D sonar data sets

June
22, 2033

US
9,019,795

Concerns
a method of object tracking using sonar imaging through point matching between 3D data sets

November
30, 2033

US
10,088,566

Concerns
a method of object tracking using sonar imaging using a bounding sphere for object tracking

November
25, 2036

US
10,718,865

Concerns
a method of compressing beamformed sonar data

March
1, 2039

US
10,816,652

Concerns
a method of compressing sonar data

October
28, 2038

US
11,061,136

Concerns
a method of tracking unknown possible objects with sonar

March
28, 2039

US
11,204,108

Concerns
a method of predicting and adjusting the laying of cable using sonar imaging.

March
22, 2039

US
11,448,755

Concerns
a method of correcting beamformed data through split aperture beamforming

June
3, 2041

US11,579,288

Concerns
a method of pseudo random frequency sonar ping generation for the purposes of data and hardware cost reduction

April
14, 2038

JP7224959

Concerns
a method of compressing sonar data

February
28, 2038

US10,
877,282

Head
Up Display System for Underwater Face Plate (within an underwater dive helmet or dive mask)

License
for exclusive use granted to Coda Octopus.

US
11,846,733

Concerns
a method of stabilizing sonar images

October
30, 2035

JP
7403226

Concerns
a method of pseudo random frequency sonar ping generation to reduce data and hardware cost

April
14, 2038

US
11,874,407

Concerns
technologies for dynamic, real time, four-dimensional volumetric multi-object underwater scene segmentation

September
30, 2041

US11,789,146

Concerns
a combined method of location of sonar detection device

August
5, 2039

Trademarks

We
own the registered trademarks listed below and they are used in conjunction with the products that we market and sell:

Coda®,
Octopus®, CodaOctopus®, CodaOctopus & Design®, Octopus & Design®,
F180®, F280®, F280 Series®, Echoscope®, Echoscope 4G®, Echoscope
5D®, 5D Echoscope®, Echoscope 6D®, 6D Echoscope®, Echoscope PIPE®,
Ping-Pong Echoscope Sonar®, Ping-Pong Echoscope®, Ping-Pong Sonar®, Echoscope Sequencer®
4G Underwater Survey Explorer®, 4G USE®, Echoscope Sequencer®, Survey Engine®,
Dimension®, DAseries®, Echoscope PIPE NANO Gen Series®, Echoscope PIPE 6G NANO®,
GeoSurvey® CodaOctopus® Air, CodaOctopus® Vantage®; CodaOctopus®
UIS; CodaOctopus® USE, Sentiris®, Thermite®; PA and PA Precision Acoustics.

In
addition, we have registered several internet domain names including www.codaoctopus.com; www.codaoctopusgroup.com; www.codaoctopusengineering.com;
www.colmek.com and www.martechsystems.co.uk; www.codaoctopusmartech.com; and www.acoustics.co.uk.

Research
and Development (“R&D”)

Research
and Development is foundational to our business strategy to ensure our growth strategy and maintain our competitiveness. The main costs
that are incurred in this area are wages and salaries, researching, prototyping, and validation and testing. The acquisition of PAL into
the Group on October 29, 2024, may result in an increase in R&D expenditure as we seek to take advantage of PAL’s expertise
with a view to bringing more products and solutions to the market.

Our
products are complex and therefore we can give no assurance that even with spending a significant part of our resources on R&D,
we will be successful in our development goals or realize significant monetization of these developments or new technologies may not surpass our R&D innovation by the time these are realized as products or capabilities. Furthermore, even
following the launch of any product we may not succeed. Moreover, we may incur significant research and development expenditures
without realizing viable products.

19

Government
Regulation

We
sell our products and services internationally and therefore we are subject to numerous laws concerning general business regulations
in the various jurisdictions in which we operate. Governmental actions (such as trade protection measures, including export duties
and quotas and custom duties and tariffs) may have a material impact on our business and directly affect our revenue and business prospects. We are also
subject to compliance with the U.S. Foreign Corrupt Practices Act and other applicable U.S. and foreign laws prohibiting corrupt
payments to government officials and other third parties. We are subject to laws and policies of the U.S. and other jurisdictions
affecting trade, foreign investment, loans, and taxes.

Furthermore,
many of our products are subject to export control regimes including in the United States, United Kingdom, Denmark, and Australia.
Where our products are subject to such export control requirements, they may only be exported to our customers if there is a valid
export license granted by the relevant government body. Moreover, these regulations may change from time to time in these
jurisdictions, including the United States, depending on the existing relationship with the country to which the goods are exported.
Increasingly the area of export control of technologies is used as a political tool and therefore inherently fluid and uncertain
– making business decisions even more complex. Our international activities are significant to our revenues and profits (see
Note 16 “Disaggregation of Revenue”). We are therefore dependent on obtaining, on a timely basis, export licenses to many foreign
jurisdictions including China. Furthermore, we may expend significant financial and other resources, including investment capital in
a country to increase sales. However, changes in government trade policy including policy on exporting technology may affect our
ability to sell our technology and therefore impact on our growth prospects.

In addition, as a supplier to US Government Bodies such as the Department
of Defense (“DoD”), we may be subject to numerous laws and regulations relating to the award, administration,
Defense Federal Acquisition Regulations (“DFARs”) and performance of US Government contracts, including the False Claims
Act. Non-compliance found by any one agency could result in fines, penalties, debarment, or suspension from receiving additional contracts
with all US Government agencies. Given our dependence on US Government business, suspension or debarment could have a material adverse
effect on our business and results of operations. In addition, the costs of complying with some of the regulations including DFARS may
be prohibitive.

We
are dependent on Government funding for a significant part of our revenue generation. To secure certain types of Defense contracts, we
need as a pre-requisite to meet DFAR on security (including regulations on the type of IT system which
must be in place, receiving, handling and storing certain classes of materials). In many instances we do not hold these credentials,
and we may therefore not qualify to compete for such contracts.

We
are also required to maintain certain accreditations including ISO 900 accreditation, Cyber Essentials, Cyber Essential Plus.

Employees

As
of the date hereof, we employ approximately 100 employees worldwide, of which 10 hold management positions. A large majority of our employees
have a background in science, technology, software and hardware engineering, with a substantial part being educated to a degree level.
A number of our employees hold PhD’s in the area of their specialization. None of our employees are employed under a collective
agreement and we have not experienced any organized labor difficulties in the past.

Available
Information

Our
internet address is www.codaoctopusgroup.com, where we make available, free of charge, our annual reports on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports, as soon as reasonably practicable after we electronically
file such material with, or furnish it to, the Securities Exchange Commission (“SEC”). Our SEC reports can be accessed through
the investor relations section of our website. With the exception of our annual and periodic reports (Form 10-K and Form 10-Q), the information
found on the Company’s website is not intended to be incorporated by reference into this or any other report we file with or furnish
to the SEC and are expressly excluded from any such form or reporting.