OTC: GLTK

WorldCall Acquisition

On December 31, 2021, we and Worldcall Holding Inc, a privately held Utah corporation (“WHI”), entered into a Plan and Agreement of Reorganization (as amended from time to time, the “Reorganization Agreement”), pursuant to which, at closing on March 2, 2022, we acquired WHI; we issued an aggregate of 117,299,472 of the shares of our common stock to Babar Ali Syed (88,463,156 shares), Muhammad Azhar Saeed (28,445,122 shares) and Mansoor Ali (391,194 shares), the former owners of 100% WHI; and WHI was merged with and into the Company, with the Company continuing as the surviving entity (the “Reorganization”).

In connection with the Reorganization, we acquired the following interests which were owned by WHI at the closing of the Reorganization and we merged with and into WHI, with the Company continuing as the surviving entity.

In connection with the Reorganization, we acquired the following interests which were owned by WHI at the time of closing:

■

100% of Worldcall Services (Private) Limited (“WorldCall Private”), incorporated on October 5, 2009, as a private limited Company in Pakistan under the Companies Ordinance 1984 (Repealed) now Companies Act 2017, facilitates channel placement and ancillary services for WorldCALL Public (defined below).

■

100% of Ferret Consulting F.Z.C. (“FZC”), a limited liability company registered on August 24, 2016, in the Emirates of Ajman, UAE, as a Free Zone Company, in accordance with the Free Zone laws and regulations enforced in the Emirates of Ajman, U.A.E which serve solely as the holding company for WorldCALL Public.

■

Control of WorldCALL Telecom Limited (“WorldCALL Public”), a publicly-traded company in Pakistan, formed as a Public Limited Company in Pakistan on March 15, 2001, under the repealed Companies Ordinance, 1984 (now the Companies Act, 2017), through the acquisition of WorldCall Private and FZC which own 9.17% and 46.03%, respectively of WorldCALL Public.

■

Control over Route 1 Digital (Private) Limited a wholly-owned subsidiary of WorldCALL Public.

Each of the entities above is under common control due to common ownership and management.

As a result of our ownership of 100% of Worldcall Private and FZC, we indirectly hold around 55% on a fully diluted basis of WorldCALL Public. We expect slight variations in our holding % of WorldCALL Public from quarter-to-quarter, because of exchange rate translations, as WorldCALL Public’s share capital is comprised of ordinary shares and preference shares, with such preference shares US$ denominated. WorldCALL Public is licensed by Pakistan Telecommunication Authority (“PTA”) and Pakistan Electronic Media Regulatory Authority (“PEMRA”) and offers channels on cable television, broadband and technology services WorldCALL Public is in the process of what we believe is an exciting journey of technological transformation, working to expand its scope of services beyond its traditional offerings. As part of this strategic evolution, WorldCALL Public has now ventured into the realm of providing cutting-edge technology services to cater to the growing needs of businesses in an increasingly digital world.

On April 24, 2024, our Common Shares began being quoted on the OTC Pink market maintained by OTC Markets and March 26, 2026, our Common Shares began being quoted on the OTCQB (venture) market maintained by OTC Markets, provided that only a limited number of our Common Shares have been traded in a very limited and sporadic market to date.

In December 2025, we acquired a 51% interest in Moda in Pelle (defined below), which operates as a women’s footwear, bag and accessories seller in the United Kingdom and Northern Ireland, which acquisition is discussed in greater detail, below.

123 Investments Limited Acquisition

Share Exchange Agreement

On November 25, 2025, we entered into a Share Exchange Agreement (the “Exchange Agreement”), with 123 Investments Limited, a private company registered under the laws of England and Wales (“123 Investments Limited” or “Moda in Pelle”), and Stephen Buck and John Patrick Bywater, the shareholders of Moda in Pelle (the “Shareholders”). Moda in Pelle, through its subsidiaries, is an independent footwear company based in the United Kingdom, which operates a retail brick and mortar as well as e-commerce stores, and they have developed technology solutions to improve sales on e-commerce platforms which include a buyer’s application, and retail and online sales channels. The transactions contemplated by the Exchange Agreement closed on December 15, 2025 (the “Closing” and the “Closing Date”).

Pursuant to the Exchange Agreement, the Shareholders exchanged 51% of the outstanding securities of Moda in Pelle (the “Exchange” and the “Moda in Pelle Stock”) with the Company in consideration for the following, issuable pro rata with each Shareholder’s ownership of Moda in Pelle:

(i) 82,800 shares of then newly designated shares of Convertible Series A Preferred Stock of the Company (the “Series A Preferred Stock”) issued at closing (the “Closing Series A Stock”), each having a deemed value of $100 (the “Agreed Value”);

(ii) 750,000 shares of the Company’s common stock at closing (the “Closing Company Common Stock”, and together with the Closing Series A Stock, the “Closing Shares”);

(iii) up to an additional 9,200 shares of Series A Preferred Stock, issuable by the Company within seven days after the one-year anniversary of the Exchange if, and only if, the Shareholders have not defaulted in, or breached, any of their obligations, covenants or representations under the Exchange Agreement or that certain Shareholders Agreement entered into between Moda in Pelle, the Company and the Shareholders on November 25, 2025 (the “Holdback Shares”); and

(iv) the right to earn additional consideration of up to $1,000,000 (the “Earnout Consideration”) in the event that both (a) the total EBITDA of Moda in Pelle in the fiscal year ended December 31, 2026 is equal to or greater than £2.5 million; and (b) the total net profit of Moda in Pelle in the fiscal year ended December 31, 2026 is equal to or greater than 1.0 million GBP, based on the financial statements of Moda in Pelle provided to the Company by February 28, 2027; provided that because we did not uplist our common stock to a securities exchange by December 31, 2025, the earnout consideration requirement is deemed automatically met and the Earnout Consideration will be due and payable regardless of the financial results of Moda in Pelle. The Earnout Consideration may be paid, at the Company’s option, in cash or shares of Company common stock, with the total number of shares of Company common stock issuable to the Shareholders equal to the total amount of Earnout Consideration divided by the average closing price of the Company’s common stock on the last five trading days of calendar 2026, rounded up to the nearest whole share (the “Earnout Shares”).

In addition, we agreed to provide Moda in Pelle with a three-year revolving credit facility of $3,000,000 on arm’s-length commercial terms (the “Credit Facility”), to be made available as soon as practicable but no later than 14 days after funds become available to us. Because the Credit Facility was not made available by January 15, 2026, Moda in Pelle may obtain a similar facility, and we will provide sufficient collateral or security to raise $3,000,000. Additionally, because we failed to provide the Credit Facility by January 15, 2026 (the “Credit Facility Deadline”) and because the Company’s common stock was not listed on the Nasdaq Capital Market; Nasdaq Global Market, or NYSE American (an “Uplisting”) by December 31, 2025, the Shareholders are deemed to have satisfied all requirements for the Earnout Consideration. We have not made any part of the $3 million credit facility available to Moda in Pelle to date as we do not have sufficient cash on hand to make such loan.

Pursuant to the Exchange Agreement, each of the Shareholders agreed that for a period of three years following the Closing, except through Moda in Pelle or its subsidiaries, that neither would compete against the Company in the United Kingdom and such countries of the Middle East as are members of the Gulf Cooperation Council (namely, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates), in connection with any product or service offered by, researched by, or developed by, the Company, Moda in Pelle, or its subsidiaries, at any time during the three years prior to the applicable date of determination, in the software solutions industry.

The Exchange Agreement includes representations and warranties, indemnification obligations, and confidentiality obligations of the parties, customary with a transaction of the size and type as the Exchange Agreement.

The closing of the transactions contemplated by the Exchange Agreement was subject to customary closing conditions including the satisfactory outcome of due diligence by the Company; entry into the Shareholders Agreement, Voting Agreement, and Lock-Up Agreement (discussed below); and the Shareholders’ taking steps to ensure that the board of directors of Moda in Pelle has five members shortly after closing, of whom three will be appointed by the Company and two will be appointed by the Shareholders, all of which have occurred to date and which Closing occurred on December 15, 2025.

Shareholders Agreement

The Exchange Agreement also required that the Shareholders and the Company enter into a Shareholders Agreement, which Shareholders Agreement dated November 24, 2025, was entered into on November 25, 2025, to be effective on the Closing Date, and includes, among other things, the following provisions:

Transfer Restrictions: The Shareholders Agreement prohibits the sale or transfer of any shares of Moda in Pelle without the consent of shareholders who collectively own and can vote more than 75% of all shares of Moda in Pelle (a “Super Majority In Interest”), subject to certain customary exceptions to affiliates of the shareholder who agree to be bound by the Shareholders Agreement.

Buyout Right: The Shareholders Agreement provides the Company with a buyout right beginning on the earlier of (i) the date of any Uplisting and (ii) the date the Credit Facility has been made available to Moda in Pelle, and continuing until the Shareholders hold no shares in Moda in Pelle, exercisable upon written notice from the Company to the Shareholders, which provides the Company the right to purchase all, but not less than all, of the shares of Moda in Pelle then held by the Shareholders (i.e., the 49% of Moda in Pelle retained by such Shareholders following the Closing) for an aggregate cash purchase price equal to the greater of (A) 120% of the Put Option Price and (B) $200,000 for each 1% of the shares of Moda in Pelle acquired. The Put Option Price means 10% of the sum of (i) 70% of the product of ten (10) multiplied by the earnings before interest, taxes, depreciation and amortization (EBITDA) of Moda in Pelle for the most recently completed fiscal year, and (ii) 30% of the product of fourteen (14) multiplied by the free cash flow of Moda in Pelle for the most recently completed fiscal year.

Put Option: The Shareholders Agreement provides the Shareholders with the right, exercisable during the twenty business days after the annual general meeting of Moda in Pelle in the third financial year following the year in which the Credit Facility is made available to Moda in Pelle (the “Put Option” and the “Put Option Period”), to exchange up to 10% of the shares then held by the Shareholders in Moda in Pelle for shares of the Company’s common stock (with the number of put option shares being equal to (i) the Put Option Price divided by (ii) the greater of (A) the average of the volume weighted average prices (VWAPs) for the ninety days prior to the date of determination; and (B) $2.50, as adjusted equitably for stock splits, stock dividends and recapitalizations. The Put Option is subject to, and can only be exercised if, (i) the Shareholders have converted their entire holding of Series A Preferred Stock of the Company into Company common stock, and (ii) Moda in Pelle has attained at least 75% of each of the following performance targets for the third financial year following the year in which the Credit Facility is made available to Moda in Pelle: (A) revenue of GBP 49 million, (B) EBITDA of GBP 4.897 million, (C) net profit (after tax) of £2.743 million, and (D) free cash (equal to cash flow from operations less capital expenditures) of £3.5 million (the “Performance Targets”), provided that the Performance Targets were automatically reduced by 40% because the Uplisting did not occur on or before December 31, 2025 and the Credit Facility was not provided on or before the Credit Facility Deadline.

Right of First Refusal: The Shareholders Agreement provides each shareholder of Moda in Pelle, subject to certain customary permitted transfer rights, a right of first refusal to purchase any shares of Moda in Pelle which any shareholder desires to transfer, at the price that they are offered to be transferred or (i) the value of the applicable shares mutually agreed upon between the applicable offering shareholder (or his or her representative, as applicable), if any, and Moda in Pelle, or all of the remaining shareholders, as applicable, or (ii) if the applicable parties cannot agree, the value of such shares as determined in good faith by shareholders holding more than 50% of the Moda in Pelle shares.

Other Rights: The Shareholders Agreement includes (i) drag along rights, requiring the Shareholders to be dragged along in any change of control transaction proposed by the Company, but only if the Put Option Period has passed, the Uplisting has occurred, and the Credit Facility has been made available to Moda in Pelle; (ii) tag along rights, allowing the Shareholders to participate in any change of control transaction proposed by the Company, but only if the Put Option Period has passed; and (iii) certain buyout rights in the event of the death or incapacity of an individual shareholder.

The Shareholders Agreement also provides for the business and affairs of Moda in Pelle to be governed by a board of directors consisting of at least five persons, of which three will be appointed by the Company and two will be appointed by the Shareholders. The number of members on the board may be increased (but not decreased) with the consent of a Super Majority In Interest. The initial directors appointed by the Company are Mehdi Mohamed Jawad Abdullah Al Abduwani (a member of the Board of Directors of the Company), Ian Barnett, and Muhammad Azhar Saeed (the Chief Financial Officer of the Company), and the initial directors appointed by the Shareholders are Stephen Buck and John Patrick Bywater, the Shareholders. The Shareholders Agreement also provides that certain transactions involving Moda in Pelle can only be affected with approval of a Super Majority In Interest.

The Shareholders Agreement remains in full force and effect until Moda in Pelle and a Super Majority In Interest, agree in writing to its termination or until the first to occur of (i) offering of shares of Moda in Pelle pursuant to a registration statement effective under the Securities Act; (ii) the purchase by one shareholder of all the issued and outstanding shares of Moda in Pelle; or (iii) the dissolution, bankruptcy or receivership of Moda in Pelle.

The Shareholders, in respect of each year in which Moda in Pelle earns an after-tax net profit, and notwithstanding anything in this Agreement to the contrary, but subject to all applicable laws, be entitled to receive from Moda in Pelle, as a management fee, the sum of five percent (5%) of Moda in Pelle’s net profit, subject to applicable law (the “Management Fee”), provided that such Management Fee shall undergo a reduction of twenty percent (20%), to four percent (4%) of Moda in Pelle’s after-tax net profit, in the event the Shareholders’ collective shareholding in Moda in Pelle drops to equal or less than forty percent (40%) of the total shares, and shall undergo further proportionate reductions for every drop in the Shareholders’ collective shareholding in Moda in Pelle up until the level of a thirty-four percent (34%) ownership interest therein (i.e., will drop by 1/6th for each decrease in ownership of the Shareholders below forty percent (40%), and the Shareholders shall no longer be entitled to receive any Management Fee from Moda in Pelle if their collective shareholding in Moda in Pelle falls below the thirty-four percent (34%) level). No Management Fee shall be due, or earned, by any Shareholder, following any applicable date that (i) the Performance Targets are not met as of the end of the third (3rd) financial year following the date that the Credit Facility is made available to Moda in Pelle; or (ii) any Shareholder is in breach of any term or condition of any of the agreements entered into in connection with the Exchange Agreement.

Voting Agreement

The Exchange Agreement also provided that the shareholders of the Company, including the Shareholders and our majority shareholders, Babar Ali Syed and Muhammad Azhar Saeed, who held 58.69% and 18.87% of the Company’s outstanding shares of common stock, respectively, as of the parties’ entry into the Voting Agreement, would enter into a Voting Agreement, which was entered into on November 25, 2025. Pursuant to the Voting Agreement, the Shareholders appointed the Majority Shareholders with a power of attorney and irrevocable proxy to vote all shares of Company securities held by the Shareholders from time to time (including Series A Preferred Stock and Company common stock received pursuant to the Closing of the Exchange Agreement) until the earlier of (i) January 1, 2029, (ii) the date that the Shareholders hold no shared of Company securities, or (iii) the date on which the Majority Shareholders have notified the Shareholders that the Voting Agreement has been terminated. The Voting Agreement also prohibits the Shareholders from selling, transferring, or pledging Company securities without the consent of the Majority Shareholders or in violation of the Lock-Up Agreement (discussed below).

Lock-Up Agreement

The Exchange Agreement also required the Shareholders to enter into a Lock-Up and Leak-Out Agreement with the Company, pursuant to which the Shareholders agreed not to directly or indirectly transfer or pledge any shares of Company common stock issuable upon conversion of the Series A Preferred Stock for a period of two years after such conversion, without the prior written consent of the Company, except that any Shareholder may transfer: (a) up to 7.5% of such Shareholder’s then individual shareholding in the Company’s common stock in any rolling period of three (3) consecutive months, and (b) subject to such Shareholder transferring a total of no more than thirty percent (30%) of such aggregate shareholding during the entirety of the two year period (based on the original shares issued upon conversion of the Series A Preferred Stock), subject to certain customary exceptions.

Convertible Series A Preferred Stock

On November 25, 2025, the Company designated 92,000 shares of Series A Preferred Stock on November 25, 2025. The Series A Preferred Stock does not accrue or participate in any dividends. In the event of a liquidation, dissolution, or winding-up of the Company, the holders are entitled to a liquidation preference equal to the greater of the $100 stated value per share or the amount they would receive if fully converted to common stock immediately prior to liquidation, distributed ratably if assets are insufficient, and paid prior to any distribution to any junior stock (including the common stock). Conversion rights include the right to convert the Series A Preferred Stock into common stock during a 60-day period beginning on March 31, 2026 (or June 1, 2026, if an uplisting application is pending), during which holders may convert shares into common stock at the Stated Value divided by the greater of $2.00 or 80% of the initial uplisting sales price on Nasdaq Capital Market, Nasdaq Global Market, or NYSE American, adjusted for stock splits or dividends, with fractional shares rounded up. The Series A Preferred Stock automatically converts into common stock on the earlier of uplisting approval or the end of the optional conversion period, using similar pricing formulas, with a floor of $2.50 for conversions at the period’s end if no uplisting has occurred.

The Series A Preferred Stock carries no voting rights except for certain customary protective provisions, which require majority holder approval for actions such as amending the Series A designation, altering authorized shares (except by redemption or conversion), authorizing new senior or adversely affecting stock, effecting exchanges into Series A Preferred Stock shares, or issuing additional Series A Preferred Stock shares beyond the Exchange Agreement terms. Increases in authorized common or junior/pari passu preferred stock are not deemed adverse to the rights of the Series A Preferred Stock. The shares have no redemption rights.

Corporate Structure

*MIP Store 1975 Limited has 14 wholly-owned subsidiaries, incorporated on September 30, 2025.

We own 55% of WorldCALL Public through our 100% ownership of WorldCall Private (which owns 9.17% of WorldCALL Public) and FZC (which owns 46.03% of WorldCALL Public). WorldCALL Public in turn owns 100% of Route 1 Digital (Private) Limited. Around 45% of the shares of WorldCALL Public are held by public shareholders in Pakistan.

WorldCALL Public’s ordinary shares trade on the Pakistan Stock Exchange (PSX) under the symbol “WTL”.

We own 51% of 123 Investments Limited.

Description of GlobalTech Corporation and WorldCALL Public’s Operations

Corporate Law of Pakistan

Under Pakistan’s Companies Act, 2017, and WorldCALL Public’s organizational documents, WorldCALL Public’s shareholders elect its Board of Directors at annual meeting of shareholders. Its Board of Directors consists of Abbas Raza (CEO), Mehdi Mohamed Jawad Abdullah Al Abduwani (Chairman), Syed Salman Ali Shah, Muhammad Shoaib, Babar Ali Syed, Muhammad Azhar Saeed, Mubasher Lucman, Hina Babar, and Tariq Hasan. As majority shareholders of WorldCALL Public, we determine the outcome of its board of directors and any corporate transactions including mergers, acquisitions, dividends, and any dissolution. As an owner of WorldCALL Public, we receive 55% of the share of its profits or losses.

Corporate Law of United Kingdom

United Kingdom’s (UK) Companies Act 2006 and Moda in Pelle’s Articles of Association provide for Moda in Pelle elect its Board of Directors at general meetings. The current Board of Directors comprises Muhammad Azhar Saeed, John Patrick Bywater, Stephen Andrew Buck, Mehdi Mohamed Jawad Abdullah Al Abduwani and Ian Alfred Barnett. GlobalTech Corporation holds 51% of the issued share capital and voting rights of Moda in Pelle and is therefore classified as a Person with Significant Control. As the majority shareholder, GlobalTech Corporation is able to exercise decisive influence over shareholder resolutions, including the appointment and removal of directors and the approval of matters reserved to shareholders, in accordance with applicable law and Moda in Pelle constitutional documents. GlobalTech Corporation is entitled to participate in the profits and losses of Moda in Pelle in proportion to its shareholding.

Our Business Operations and Services

Our 55% owned subsidiary WorldCALL Public’s Long Distance & International (“LDI”) network provides local and international interconnect services (connections between telecom service operators) to its customers in Pakistan. WorldCALL Public also provides digital television, analog cable television, broadband internet services in Pakistan and technology services outside Pakistan. WorldCALL Public is also engaged in the development of software products and solutions that are offered as standalone service offering to clients.

We sell our digital television, analog cable television, broadband internet and technology services to consumers and businesses.

Our subsidiary company 123 Investments Limited operates with a brand name of Moda in Pelle, which focuses on premium footwear brands. The group provides design-led, high-quality footwear products through multi-channel retail and e-commerce to its customers. Its proprietary technology platforms provide operational, analytical, and customer engagement services to its trading subsidiaries.

Strategic Priorities

Our strategic priorities for business expansion include:

·

Investment in our holding companies with a goal of growing revenues, including plans to:

o

Enable new technology with the goal of growing operations.

o

Raise funding to facilitate core business growth.

o

Instilling a culture of business and operational excellence.

o

Expand our business into new markets and products.

·

Development and commercialization of technology platforms and products incorporating Artificial Intelligence and Big Data into our technology framework, seeking to obtain a competitive advantage. Segment engagement criteria is expected to be captured as follows:

o

Identify sizable market with robust credentials for future growth and with existing products and offerings that are operating on an older technology framework.

o

Identify and well-define market requirements, with no specific barriers for new entrants.

o

Access requisite technology resources for product development and management.

·

Acquisition of companies and products with scalable business models that can extract maximum benefit from the new technological landscape, including AI, Big Data, and Virtual Reality. We plan to seek out companies and/or products that have:

o

An established credible brand image and performance credentials in their respective domestic markets.

o

Technological excellence at the core of their business that can be further upgraded and developed for commercial offerings by a new technology stack.

o

Possible significant growth potential through access to growth capital and technology excellence.

·

Maximizing investor returns through diligent execution and continuous optimization while ensuring ethical and responsible innovation at the core of all our actions and plans.

·

Developing a talent pipeline to support and sustain our tech initiatives.

·

Expanding globally and forging strategic partnerships to share the fruits of success.

Technology Services and Products

Telecommunications Services

WorldCALL Public’s LDI Network provides local and international interconnect services to customers and other telecommunications providers in Pakistan using its LDI network. It is one of the largest LDI networks in Pakistan. The current capacity of WorldCALL Public’s network is nearly 8 million minutes per day of traffic.

Below is a table of quantifying WorldCALL Public’s telecommunications customers for each period presented and information on other telecommunications providers to which it provides services:

Category

December 31,

2025

December 31,

2024

December 31,

2023

Total Telecommunication Customers

3

3

3

The Company also provided telecommunication services to five non-customer operators as of December 31, 2025, December 31, 2024 and 2023, from whom no revenue is recognized by the Company. Instead, these operators function as vendors with whom the Company maintains interconnection arrangements to facilitate seamless communication across networks. Through these arrangements, the Company provides traffic to these operators, which they terminate to the relevant end user. These operators invoice the Company for their interconnect service.

Broadband Services

WorldCALL Public’s broadband services include digital television, analog cable television, and broadband internet services.

Broadband makes it easy to transfer heavy data, send/receive large emails, download music, and view videos online. According to Media Partners Asia, WorldCALL Public is one of the largest Cable Television operators in Pakistan.

■

Digital Television Services: For digital television services, WorldCALL Public provides a Set-top box for digital signal, which is a converter box that converts an encrypted signal from our central office to the customer’s location where the signal is provided to the customer’s television. Our digital television offers more than 200 channels, providing a television entertainment experience with sharper images, vibrant colors, and stereo sound. We presently have approximately 128,000 customers for our digital television at a monthly cost of between $0.20 to $8.00 per month, which includes Internet and digital television.

■

Analog Cable Television Services: For analog television services, WorldCALL Public provides a coaxial connection, which is directly connected to the customer’s television. Our analog cable television offers 80+ crystal clear channels, including a wide assortment of satellite and in-house channels with a wide range of movies, news, and documentaries. We presently have approximately 490,000 customers for our analog television at a monthly cost of between $0.20 to $8.00 per month. This does not include Internet.

■

Internet Service: We provide internet services to our customers, that allow for data downloads and data uploads. This includes internet access, email facilities, web-page facilities, and any other related internet facility or services that we may provide from time to time.

We use Hybrid Fiber Coaxial (HFC) to transport our signal from our central facility to distribution points within our network using fiber optics. We convert the signal at each location to a radio frequency (RF) signal, which is transported by coaxial cable to our customer locations to provide digital and analog cable and internet. Our Hybrid Fiber Coaxial (HFC) coverage extends to nearly 200,000 home passes in Lahore and Karachi, the two largest cities of Pakistan with a combined population of 34 million, as shown by the Pakistan Bureau of Statistics. Our Cable TV coverage extends to four (4) additional cities and reaches nearly a million households. All connectivity is provided to local loop operators on fiber for further distribution on loop holder HFC infrastructure.

We use cable modems for data connectivity where our coaxial cable is connected to a cable modem which converts the signal for download and uploads to the customer premise equipment. For FTTH (Fiber to the Home), we use Optical line termination (“OLT”) and an Optical Network Termination (“ONT”). On a fiber network, the ONT/ONU is located at customer premises. The purpose of this device is to use optical fiber to connect to the passive optical network (PON) and communicate with the Internet service provider to get an Internet connection.

Long Haul and Metro Fiber

WorldCALL Public has deployed approximately 1,900 kilometers (1,180 miles) of metro fiber in 20 cities across Pakistan to provide its customers with internet and television service. The metro fiber network is located in dense urban centers, giving it a considerable advantage in service activation and last mile connectivity to market. WorldCALL Public has an advantage over its competitors because WorldCALL Public uses its own fiber network to transmit data and provide its broadband services to its customers, whereas competitors lease fiber from other entities, including WorldCALL Public, and then build their network to offer services to end users.

WorldCALL Public also has 4,500 kilometers of fiber in three fully redundant ring configurations across one long haul infrastructure which is expected to be activated in the near future. Once activated, the combination of metro fiber and long-haul infrastructure will allow coverage to approximately 3.2 million homes.

Technology Services

WorldCALL Public has developed customized technology solutions tailored to meet specific business needs, enhancing digital transformation.

Retail footwear

The Company through its subsidiary 123 Investments Limited is engaged in women footwear business through retail and e-commerce operations.

Summary Table for Services offered

No.

Service

Service Area

End-Consumer

1

Long Distance and International (LDI)

National

1a

Bulk Sales

Telecom Operators

1b

Call termination charged per minute

Telecom Operators

2

Broadband

2a

Fiber to the Home (FTTH)

Lahore

Corporate/Residential

2b

Hybrid Fiber Coaxial (HFC)

Lahore / Karachi / Islamabad

Residential

2c

Affordable Broadband

Lahore / Karachi / Islamabad

Resellers/Residential

2d

Fiber Optic connectivity

Telecom Operators/ Corporate

3

Cable TV

3a

Analog and Digital Service (FTTH)

Lahore

Corporate/Residential

3b

Analog and Digital Service (HFC)

Lahore / Karachi / Islamabad

Residential

3c

Analog and Digital Service (Fiber Optic)

Lahore / Karachi / Islamabad

/ Multan / Faisalabad

*Local Cable Operator/

Local Loop Operator

4

Technology Services

International

Non-Residential

4a

Backing software

International

Non-Residential

*We provide Analog and Digital services via our Fiber Optic network to local cable operators, wherein each of the local operators reduces capital costs by receiving our service rather than installing equipment for receiving programming directly from Networks.

Pricing information for the listed services is as follows:

Service 1a is charged at bulk monthly rates with unlimited volumes of traffic. The origination operator is able to generate additional volumes by offering discounted calling rates for Pakistan and local Pakistani operators connected to the Company’s LDI networks which benefits from additional income by utilization of vacant capacity on the interconnect. The Company’s margin is fixed irrespective of the volume of traffic.

Service 1b is charged on per minute of traffic (on per second incremental basis) to the originating party along with a corresponding termination rate charged by the terminating party connected to Company’s LDI network.

Services 2a and 3a is direct fiber connectivity to the end user through Fiber to the Home (FTTH) architecture. Service is charged as per subscription opted by the end user, and includes cable TV and broadband data. Cable TV offerings further include the option for analogue, digital or both services.

Services 2b and 3b are direct hybrid fiber coaxial (HFC) connectivity to the end user. Service is charged as per subscription opted by the end user and includes cable TV and broadband data. Cable TV offerings further include options to have analogue, digital or both services. Compared to FTTH, HFC offers a lower capacity broadband connectivity for the end-user.

Service 2c is connecting local resellers to the Company’s backbone where service offerings and packaging is done by the Company and local loop operators only manage subscriber services for connectivity and network maintenance. The Company charges individual packages on a pre-paid top-up basis.

Service 2d provides backhaul and core network connectivity for telecom operators along with P2P links for corporate data connectivity. Telecom operator’s charges are on a long-term lease basis with O&M charged on an annual basis for a specific length of fiber optic network deployment. For corporate clients, this includes one-time charges for network deployment with monthly O&M.

Service 3c connects and provides local cable operators and local loop operators with the Company’s Cable TV services (Analogue and Digital). The connection is made on fiber optic cable to end-user premises and further distribution is handled by local loop operators through their own resources.

Service 1 is monitored for volume of traffic and applicable rates. Services 2a, 2b, 2c, 3a and 3b are monitored on subscriber connected basis. Services 2d and 3c are monitored for new sales and a Service Level Agreement (SLA) is delivered for existing customers.

Service 4a, for our software development services, the Company charges on a delivery basis with prices for services and products, as per negotiated contract terms with clients.

Service 4b, for software products, the charges are on annual and /or monthly subscription basis along with options for charging on per query and /or usage basis.

Long Distance and International traffic operations

The Company maintains a robust infrastructure and international interconnect portfolio for its international traffic operations. The operations target voice traffic coming to Pakistan principally originating from overseas Pakistani population calling home and not any significant business / corporate originations. Traditional traffic origination points are Middle Eastern countries, the United Kingdom, and North America. Termination of voice traffic is highly regulated in Pakistan and the Company has been in operation since 2004 in this segment of operations.

Prepaid and Post-Paid Customers

Our primary source of telecom revenue comes from prepaid customers, who are not required to enter into long-term fixed contracts, and we cannot be certain that these customers will continue to use our services and at the usage levels we expect. Prepaid customers are individual households who subscribe to the Company’s data and cable TV services, without entering into long-term fixed contracts. Invoices for these customers are issued at the beginning of each month, and the arrangements are short-term in nature. A significant portion of our telecom revenue, approximately 79% for the year ended December 31, 2025 comes from telecom operators and significant corporate clients that are provided connectivity services by WorldCALL Public on its fiber optic network, which are required to enter into long-term fixed contracts. WorldCALL Public enters into maintenance service contracts with customers which provide for quarterly maintenance payments to be paid to WorldCALL Public to maintain fiber optic cables. Services to these telecom operators and significant corporate clients are on a postpaid basis, where services are delivered first, and the customers are then invoiced in accordance with the agreed billing cycles stipulated in their respective contracts. Such contracts establish a longer-term relationship and recurring revenue stream for the Company, as compared to the relatively short-term arrangements with prepaid customers who have no fixed contracts. These contracts typically have a term of 20 years, provide for the customer to pay quarterly maintenance payments, provides for the right of either party to terminate the agreement with 60 days’ notice upon a breach of the agreement, if not cured in such period, allows for termination if the counterparty becomes insolvent, goes into liquidation (other than for restructuring), has a receiver or administrator appointed, makes arrangements with creditors, has assets seized, or stops business in a way that affects the other party’s rights. In addition, the customer can end the agreement at any time by giving 90 days’ written notice for any reason or no reason. In that case, WorldCALL Public must refund any unused advance payments made by the customer within 30 days after the notice period ends.

Revenue from postpaid customers represents a small percentage of our total operating revenue, and such customers can cancel our postpaid contracts with limited advance notice and without significant penalty. Furthermore, as we incur costs based on our expectations of future revenue, the sudden loss of a large number of customers or a failure to accurately predict revenue in a given market could harm our business, financial condition, results of operations, cash flows, or prospects.

AI & Big data

Artificial Intelligence (AI) maturity as a technology and its availability at reasonable pricing is impacting the conduct of business across a wide spectrum of industries. Artificial Intelligence with its ability to deliver actionable insight on a specific data-set impacts the Company’s decision-making processes and it further streamlines workflows for cost, time and operational efficiency. We believe this presents an opportunity to target existing market applications and requirements that can be better serviced by using new tools available for solutions development and delivery in the AI domain. In big data applications, data ingestion, curation and analysis, powered by technology stack available under AI, is being facilitated by enhanced processing power and development of customized algorithms for specific requirements. Cloud and hosting infrastructure is also maturing at pace with industry requirements.

In order to monitor for potential algorithmic drift or hallucinations in our open-source AI products, we have implemented a monitoring framework that tracks key model performance metrics (including accuracy and F1-score - a statistical measure used to evaluate how well an AI model is performing, taking into account precision and recall) and evaluates data distribution shifts against established baselines, utilizing open-source monitoring tools such as Evidently AI and WhyLabs.

We have also taken various steps to help mitigate algorithmic hallucinations, including implementing proactive testing using benchmark datasets (internal) and adversarial red teaming (i.e., deliberately stress-testing a model in order to uncover weaknesses, blind spots, or vulnerabilities) to seek to uncover model weaknesses. We have also established continuous monitoring through real-time observability tools that track confidence scores, user feedback, and seek to track anomaly detection in production. Mitigation involves implementing automated retraining pipelines triggered by performance decay, regularly updating models with fresh, curated data, and employing techniques like continual learning to adapt to new patterns, thereby ensuring the model remains accurate and reliable in a dynamic real-world environment.

Our core focus for software development is on regulatory compliance assurance (including risk mitigation solutions), integrated e-commerce with Enterprise Resource Planning (ERP) offerings and big data platforms. We believe our focus areas for software development have robust market credentials in terms of existing market and good future growth potential down the line. We believe that a major part of our existing market in these target segments will need to migrate to better, faster and more cost-efficient offerings developed using the latest technology stack. We believe that our focus areas represent significant opportunity as a major portion of the current market is serviced by technology products that are not AI ready or enabled and would need significant development to transform into a more competitive product.

The Company also operates a Center of Excellence (CoE) for AI & Big Data services to support our software solutions development and sales. It includes a wide-reaching industry engagement initiative to enable co-creation and collaborative software developments. A curated portfolio of significant products is showcased on our website and certain significant products are also marketed through their own dedicated branding with independent web and social media presence.

Telecom, Broadband and Cable TV Operations

Long Distance and International Operations

International voice termination into Pakistan is a major revenue stream for the Company and it increased by $1.38 million in 2025 compared to 2024. The increase in volume of traffic facilitated by additional capacity offering to our middle east client contributed to this revenue growth.

Broadband and Cable Operations

The Company has nearly 1,900 kilometers (1,180 miles) of fiber optic infrastructure deployed across 20 major cities of Pakistan with a potential ability to access a market of almost 3 million households for subscriber acquisition. We believe that this is a major asset moving forward as access to subscriber concentration points is essential for our future strategy. Our focus areas remain on upgrade of our existing HFC subscriber base to FTTH which has continued for this year.

Broadband customers increased in 2025 through our offering of more affordable broadband only service on FTTH and additional revenues of $0.35 million were recorded in 2025. It is expected that growth in subscribers will continue with additional investments in subscriber acquisitions. Additionally, we migrated part of our subscriber base on Hybrid Fiber Coaxial (HFC) network to a more robust Fiber to the Home (FTTH) offering.

Video revenue decreased in 2025 primarily due to a decline in the number of residential video customers, partially offset by an increase in average rates. We expect that the number of residential video customers will continue to decline as viewers are using streaming services and dropping cable television bundled services. We expect this trend to continue. Additionally, the decrease in Cable TV customers is mostly on account of disengagement and conversion of Cable TV connectivity to broadband reseller bandwidth which is offered to the same customers. There was minimal to no impact on the service revenue from this transition.

Technology Services and Products

Our revenues for software development and solution sales increased during the year. The Company delivered software based on Hyperledger® platform for a UK based client. The Company delivered a custom platform for the client. It entailed development of a hybrid solution that enabled the Hyperledger based platform to deliver permissioned connectivity with automated KYC integration. Features for service management that were not available in the Hyperledger® framework were developed for this purpose. The segment recorded additional revenues of $1.41 million in 2025, compared to 2024. Additional growth is expected as more products are maturing into commercial offerings and additional sales are being targeted in this segment of operations. The Company has also upgraded its internal software for commercial offering across various segments. Billcare has been developed, focusing on subscriber billing for the cable industry and is being launched in US market.

Moving forward we expect revenue contributions from technology operations and services to increase significantly.

Our technology services and products which we believe are ready for market deployment include:

Digital Lending Platform

CADNZ is a unique AI ready – Enabled Digital Lending Platform that seeks to deliver frictionless operational excellence. The platform incorporates the latest technology framework. For AI readiness, the Company has developed a robust data-management solution including data-warehousing, a customized ETL (Extract, Transform and Load) engine that can handle a wide set of data integration requirements and seamless connectivity scheme that can facilitate integration of third-party applications as per client requirements. A reporting engine delivers actionable insights along with trigger automations that can identify and highlight areas of intervention independently. Data structure has also been enabled for future AI integration for specific client requirements. We believe that CADNZ is an ideal solution for small to medium sized banks and credit unions. It replaces multiple fragmented system deployments by allowing for the integration of all functionalities into a single hub. CADNZ automates workflows, empowering banking staff to focus on customer engagements and business growth delivering seamless interactions for both clients and customers. CADNZ is specifically developed for the US banking sector and we believe that this has huge potential. In the future, the Company plans to offer this product in Europe, the UK and the Middle East. We believe that this project has potential to generate significant revenues for the Company moving forward.

CADNZ, is designed to support future AI features, but does not currently contain any such AI features and as such is not classified as an AI-powered product. The structure of CADNZ allows for the integration of AI engines in the future to improve features and productivity. However, these AI services may or may not be provided, depending on the client's choice.

The estimated market size of the global digital lending market was $11.3 billion in 2022 and is expected to grow to $30.8 billion in 2030, according to a May 2022 report by Vantage Markets Research entitled “Digital Lending Market Growth and Trends | Insights & Forecast 2025-2035 by Offering (Solutions, Services), by Deployment Mode (Cloud, On-premises), by End User (Banks, Credit Unions, NBFCs), by Region (North America, Europe, Asia Pacific, Latin America, Middle East & Africa”.

The Company hopes to launch CADNZ commercially during the second quarter of 2026. Client demos are already in progress and the Company believes that the product is deployment ready. Enhancements are planned post commercial activation and work on the same has already been initiated. At present, the primary focus is on execution of go-to-market plan. The Company estimates $0.5 million to $0.7 million as the costs to be incurred for commercial activation focused on client on-boarding.

The primary sources of revenues from CADNZ are expected to be from annual subscriptions and one time on-boarding fees. Add-ons for third party services integrated into the platform may also provide an additional revenue stream.

Compliance Assurance and Risk Mitigation

Under the auspices of the Company’s AI & Big Data Center of Excellence (CoE) initiative, the Company has worked to strengthen the collaborative development of products that make use of the latest technology stacks targeting compliance delivery and risk mitigation for various applications in law enforcement and the financial sector. Three products have been curated for global operations. These are cocreation initiatives where Go-to-Market and sales in respective territories are the responsibility of the Company.

EntityScan is focused on individual and corporate listings for usage by banks and law enforcement agencies for intelligent sanction and criminal screening for compliance and risk management. The core database is connected to a significant number of sources and is updated in near to real-time for its data points by reviewing daily updates as released by respective entities. ETL processing for uniformity is ensured and query results are further curated for accuracy and relevance. AI is deployed for curation of data (exact and fuzzy match) and processing of distorted images.

EntityScan uses AI to address key challenges in intelligent screening. It helps resolve issues like name and entity ambiguity through advanced fuzzy matching, and it extracts important data from poor-quality images using computer vision technology. This combined AI approach improves raw, unstructured data, making it more accurate and reliable. We believe that this results in an effective screening service, particularly in compliance and risk management where precision is essential.

To build this resource, EntityScan pulls data from various trusted sources, including sanctions lists, law enforcement databases, and corporate records, often in hard-to-use formats like scanned PDFs. Its AI processes automate the extraction and scrubbing of this data in near real-time. Each AI process undergoes extensive testing to ensure it works reliably and securely, with top-notch protection of data both in transit and at rest.

EntityScan’s system uses multiple layers of security and checks, including pre-launch testing, confidence scoring, human review for uncertain results, and ongoing monitoring, ensuring its AI-driven screening remains accurate and minimizes the risks of errors, especially in high-stakes environments like compliance and law enforcement.

EDFI-AI (Enhanced Digital Financial Information powered by AI is focused on predictive and pre-emptive transaction analysis that can be deployed in any transactional space for identification of suspicious and fraudulent activities. A proprietary framework ETL, processes and populates a database with historic data, curates the relationship schematics into a graphical representation of transactions collapsed for simplicity and ready analysis. Once the system is deployed, transactions can be monitored on multiple data points in parallel to isolate any anomalous behavior that may require intervention to ensure compliance. EDFI-AI as a product is primarily structured for banks. AI is deployed for a network analysis engine and use of graph database.

EDFI-AI uses AI-driven network analysis to detect fraud in financial institutions. It processes transactional data into a dynamic graph where entities (like accounts and customers) are connected by transactions. Sophisticated AI models analyze this data in real-time to help to identify fraud, money laundering, and other risks that traditional rule-based systems may miss. It continually adapts to evolving threats, reducing false positives. This system uses enterprise-grade data and internal AI models built with open-source technologies. It carefully measures accuracy using metrics like False Positive Rate, False Negative Rate and Precision/Recall balance, helping to ensure continuous improvement through feedback systems and performance monitoring.

HyperLocal PEP Scan is focused on identifying and classifying Politically Exposed Persons for financial institutions. The HyperLocal PEP listing is further augmented by review of local data to deliver a hyperlocal Politically Exposed Persons (PEP) tool. Local data ingestion is further augmented by AI enabled search tools used in facial recognition and RCA (Relatives and Close Associates) development. PEP handling by financial institutions is highly regulated and sensitive and our HyperLocal PEP Scan delivers a robust solution which is much faster to deploy with a much higher degree of accuracy than competitors’ products.

HyperLocal PEP Scan uses AI to enhance the search and mapping of politically exposed persons (PEPs). It processes localized data to find PEPs missed by global lists and builds detailed networks of PEPs. It also uses AI for facial recognition and relationship mapping across various data sources, ensuring high accuracy through validation and feedback.

This portfolio of projects is ready for commercial sale and is being marketed for global deployment in US and international markets.

According to a report by Grandview Research, the global enterprise governance, risk and compliance market size was estimated at $62.9 billion in 2024 and is expected to grow at a 13.2% compounded annual growth rate through 2030.

ERP with e-commerce integration

Our Thrivo.AI platform is being developed by the Company to integrate retail centric ERP with AI enabled e-commerce offerings. We believe that current e-commerce offerings provide limited data insight to business owners related to actual decision matrices that can translate into sales on their storefront. The Company is developing an e-commerce platform offering that would capture additional data points related to sales maturity and deliver actionable insight to business owners for improved sales conversion. AI tools are being used for creating the data-management solution and BI dashboard development. We believe that it offers unique competitive advantages for small to midsized retail operations that require additional actionable insights in the changing landscape of business operations. Thrivo.AI directly contributes towards enhanced efficiency, agility and business resilience of its clients. Thrivi.AI is being packaged in a modular architecture to ensure a smooth on-boarding of clients in the least cumbersome manner with additional cost efficiency as it delivers all-in-one integration. It is targeted to replace disparate offerings that functionally deliver ERP, retail management and e-commerce in standalone architecture.

Thrivo AI leverages internal transactional data to optimize retail performance. Using client data, it enables targeted customer segmentation, predicts customer behavior, and provides insights on sales funnels, inventory management, and dynamic pricing. These features seek to help businesses boost revenue by improving customer retention and acquisition.

According to an August 2023 report by Markets and Markets, the total e-commerce platform market size is projected to grow from $7.1 billion in 2023 to $13.5 billion in 2028.

Client demos of our Thrivo.AI platform are planned for the second quarter of 2026, with a planned commercial launch in the second quarter of 2026, with the ERP integration expected to be finalized in the second quarter of 2026. We currently estimate a cost of $0.2 million to $0.3 million for the E-commerce module (platform) and another $0.5 million to $0.7 million for the retail ERP development completion and integration.

We expect to generate revenue through this platform through one-time on-boarding fees and reoccurring quarterly revenues through revenue share from the enhanced sales expected to be delivered from the platform.

Sports League Management System

We are engaged in development of a sports league management system ‘SLMS’, for a major team sport, i.e., baseball and softball. We believe that this product has a significant market and that we have the technology assets available to deliver a highly agile and competitive product.

To ensure an earliest possible time to market for this product, the Company recently acquired a core software platform, the “CricksLab Core Engine” from CricksLab L.L.C-FZ, as discussed below. The acquisition of the core engine delivers core functionalities and Company is focused on developing an application layer for the baseball and softball. The acquired SLMS provides all functionalities related to player, team, league and tournament management. It also includes functionalities of live broadcasting (Video and Scoring), statistics and scoring. CricksLab platform is used by national cricket boards of Italy, Kuwait, Qatar and Pakistan for national management of cricket. Under the acquisition agreement, CricksLab is committed to fully supporting product development on the acquired platform.

We are currently developing an application layer and customizing the core engine product handling to include additional features related to video analytics on live streaming, merchandizing, much wider social media engagement automations and community engagement services for the benefit of end-users.

Video analytics on live streaming is being implemented to open additional avenues of business engagement related to talent identification services, coaching services and talent management services. The community engagement module is being enhanced significantly to target a much wider segment in the addressable market compared to current application.

According to a report updated in January 2025, by Fortune Business Insights entitled “Sports Management Software Market Size, Share & Industry Analysis, By Deployment (Cloud and On-premise), By Application (Player & Team Management, Event & League Management, Fan & Customer Engagement, and Ticketing & Sponsorships), By End-User (Team, Sports Association, Event Organizers and Tournament Hosts, Sponsors & Marketers, Media & Broadcasters, and Others), and Regional Forecast, 2026–2034”, the global sports management software market size was estimated to be valued at $312 million in 2024, and to grow to $1.25 billion by 2032.

We are targeting the second quarter of 2025 for the launch of the League/Club/Team/Player Management, Game Day and Scoring part of our sports league management system and the first or second quarter of 2026 for the live streaming, coaching, merchandizing and community management modules of our sports league management system. In the meantime, we plan to begin product demos in the second quarter of 2025 across various markets. We estimate the cost of launching this product at between $0.25 million to $0.4 million.

We expect to generate ongoing monthly subscriptions revenues with annual contracts for basic services, and additional fees for activation of enhanced features of our sports league management system.

CricksLab Acquisition Agreement

On April 7, 2025, we entered into a Core Engine Acquisition Agreement (the “CricksLab Agreement”) with CricksLab L.L.C-FZ.

Pursuant to the CricksLab Agreement, CricksLab (1) agreed to sell us a copy of their core engine, i.e., the proprietary software, system and solution developed and owned by CricksLab, used to develop, run and operate a cricket management and livestream platform (the “Platform”), including but not limited to source code, object code, algorithms, libraries, and documentation which was developed for the “Sports League Management System” (SLMS) (the “Core Engine”); and (2) agreed to provide us an irrevocable, perpetual, worldwide, royalty-free, and transferable license to use, modify, create adapt, distribute, commercially exploit and sublicense the Core Engine for the purpose of developing, deploying, and operating software platforms for various sports, including but not limited to, baseball, softball and other variants, and other sports and gaming applications, except Cricket (the “CricksLab Use”), but including gaming, sports simulations, entertainment, AI, and other related technologies (the “License”). The Core Engine is currently utilized as the core software for CricksLab’s service platform “CricksLab”. CricksLab is in commercial use for cricket league management by national cricket boards of Qatar, Kuwait, Italy and Pakistan.

The sale of the Core Engine and the License granted to the Company under the CricksLab Agreement included the following rights, all of which are worldwide, perpetual, irrevocable, and exclusive as to baseball, softball and other variants of bat and ball sports other than Cricket (the “GTC Use”), and non-exclusive as to every other use, other than the CricksLab Use (which shall be exclusive to CricksLab). The Company’s use of the Core Engine includes all functionalities related to player, team, league and tournament management. It also includes functionalities of live broadcasting (Video and Scoring), statistics and scoring.

The consideration for the acquisition of the Core Engine and License was 10,000,000 shares of common stock, which had an agreed upon value of $10,000,000.

The CricksLab Agreement includes provisions providing for CricksLab’s right to continue to use the Core Engine for its internal business operations and allow CricksLab to sell, license, or transfer the Core Engine to third parties, provided that such use or sale: does not violate the non-compete clause of the agreement (discussed in greater detail below); does not conflict with the GTC Use; does not affect or restrict our rights, usage, or ownership of the Core Engine in any manner, including, but not limited to the License; and that CricksLab ensures that any third party to whom the Core Engine is sold, licensed, or transferred is bound by terms no less restrictive than the Non-Compete Clause. The “Non-Compete Clause” prohibits CricksLab, indefinitely, from directly or indirectly, selling, licensing, transferring, developing, marketing, or otherwise providing any platform or solution that relates to the GTC Use or that competes with the platforms the Company intends to develop using the Core Engine. CricksLab is also prohibited under the agreement from engaging in any commercial activities—including sales, licensing, marketing, or pitching—related to baseball, softball, or similar platform development within the United States, Mexico, Japan, or any other jurisdiction where we currently operate or have announced plans to operate. We also agreed to not directly or indirectly engage in development of the Core Engine related to the CricksLab Use.

We acquired the Core Engine from CricksLab initially to develop platforms for management and live streaming of baseball, softball and other variants of bat and ball sports other than Cricket, to benefit various stakeholders, including associations, broadcasters, clubs, academies, leagues, TV studios, players, analysts, and fans. The platform is expected to support international-quality matches, live streaming, AI-powered news feeds, stories and blogs, social media automation and fan engagement features like “Guess & Win” contests. The Company is already engaged in development of an application layer for a similar team sport and plans to incorporate additional features relating to video analytics and live streaming, merchandizing, much wider social media engagement automations, and community engagement services to benefit end-users.

The CricksLab Agreement includes (i) customary covenants of each of the parties and confidentiality requirements; and (ii) customary indemnification requirements of the parties.

The transactions contemplated by the CricksLab Agreement closed on April 7, 2025.

AI Models

All of our AI models are developed using open-source Python libraries and are rigorously tested before use. Ethical AI practices are central to this platform, including fairness testing, bias mitigation, and transparency in consent processes. The AI models also generate documentation to explain the insights they provide, ensuring users can make informed decisions while staying compliant with regulations and ensuring fairness.

Backlog of Orders

We have no backlog of orders.

Seasonal Aspect of our Business

Our business is not seasonal.

Status of any Publicly Announced New Product or Service

We have no publicly announced new product or service.

Competitive Business Conditions

For each segment of business operations, we have a different competitive landscape with the following identified competitors.

Competition—Broadband/Internet in Pakistan

The following table shows our and our competitors’ respective customers for Broadband services in Pakistan as of March 26, 2026:

Operator

Customers

WorldCALL Public

128,000

Pakistan Telecommunications Company Limited (“PTCL”)

850,000

Cybernet (PVT) Limited

99,000

Transworld Associates

46,000

Nayatel (Pvt) Limited

23,000

Multinet (Pvt) Limited

30,000

Wateen (Pvt) Limited

7,000

In major metropolitan areas, for our Broadband and cable television services, we compete with two or three operators servicing a specific housing development. WorldCALL Public has transitioned to IP transit wholesale operations and future projections remain positive on account of the unserved or under-served market with good growth potential. WorldCALL Public was awarded the prestigious “Consumers’ Choice Award” for “Best Affordable Broadband Service” from 2022 to 2025.

Competition—Cable Television in Pakistan

The following table shows our and our competitors’ respective customers for digital and analog cable television service in Pakistan as of March 26, 2026:

Operator

Customers

WorldCALL Public

490,000

Pakistan Telecommunications Company Limited (“PTCL”)

90,000

Cybernet (PVT) Limited

65,000

DG Cable (Consortium)

500,000

Solo Cable (Consortium)

650,000

Data Protection

In Pakistan, there are a number of statutes and regulations on data protection to which we are subject, including the Prevention of Electronic Crimes Act, 2016, the Pakistan Telecommunications (Re-organization) Act, 1996.

Under the applicable laws and regulatory requirements, we have a responsibility to protect customer information and to ensure that information is not disclosed without prior customer consent, except as required under the law.

Costs and Effects of Compliance with Environmental Laws

We have no material costs associated with environmental laws.

Product Liability Insurance

We do not carry commercial liability, including product liability coverage. WorldCALL Public carries property insurance.

Technology Services

WorldCALL Public has developed customized technology solutions tailored to meet specific business needs, enhancing digital transformation.

Patents and Trademarks

We do not hold any patents. World Call Public holds a trademark registered with The Trademarks Registry, Karachi, Government of Pakistan, including the “WorldCall logo”. We also rely on trade secret protection for our confidential and proprietary information. 123 Investments Limited hold two brand names, one is 123 and the other is Bsoleful.

Employees

We have 459 full-time and 0 part-time employees as of February 28, 2026 as follows:

WorldCALL Telecom Limited

Full-Time (228)

Part Time (-)

Sales & Technical

119

-

Administrative

101

-

Management

8

-

Worldcall Services (Private) Limited

Full-Time (9)

Part-Time (-)

Sales

-

-

Administrative/Management

9

-

Ferret Consulting

Full-Time (2)

Part-Time (-)

Sales

-

-

Administrative/Management

2

-

123 Investments

Full-Time (220)

Part-Time (-)

Sales & Marketing

170

-

Supply Chain & Operations

32

-

IT & Technical

7

-

Administration & Management

11

-

GOVERNMENT APPROVALS

WorldCALL Public is fully licensed and registered with the following bodies:

■

Pakistan Telecommunications Authority (PTA) for Telecom and Broadband Service

■

Pakistan Electronic Media Regulatory Authority (PEMRA) for its Cable Television services.

■

Pakistan Software Export Board Call Center, Software Development and IT Services (PSEB) for whitelisting, software development for deployment to customers that require specific fiber optic transport and internet connectivity services.

■

National administrative bodies National Highway Department, Pakistan Ministry of Defense, and Ministry of Communications for Fiber Optic network deployment for its Broadband services.

■

Local governments in Pakistan for Right of Ways (ROW) for its Broadband, Digital Cable and analog television services.

All of our telecom and cable television operations are conducted through WorldCALL Public which holds the following licenses:

Type of License

Regulatory Authority

License Fees

12/31/2025

License Fees

12/31/2024

Renewal

Telecommunications and Broadband (1)

Pakistan Telecommunication Authority (the “PTA”)

$ -

$ 30,868

Under process

Cable Television (2)

Pakistan Electronic Media Regulatory Authority (“PEMRA”)

$ 63,631

$ 61,794

2024-2027

(1)

Includes origination and connectivity services. We are obligated to pay annual fees to PTA and make certain universal service fund contributions and/or research and development fund contributions, as applicable equal to 2.5% of annual gross revenues less inter-operator costs.

(2)

Includes digital and broadband television.

The table below presents a description of local business licenses relevant to our broadband and cable business in Pakistan. Unless noted otherwise, we plan to apply for renewal of these licenses prior to their expiration.

Services

License

Expiration

Long Distance and International (PTA)

Nationwide

2024 (Renewal application under process)

Local Loop (PTA)

Lahore and Karachi

2024 (Renewal application under process)

Cable TV

Islamabad/Rawalpindi

2024 (Renewal application under process)

Cable TV

Lahore

2025 (Renewal application under process)

Cable TV

Karachi

2027

GOVERNMENT REGULATION

Regulation of Telecommunications and Broadband in Pakistan

Under the Pakistan Telecommunications (Re-organization) Act, 1996, as amended (the “Telecommunications Act”), responsibility for telecommunications regulation in Pakistan lies with the Ministry of Information Technology and Telecommunication (the “MoIT&T”) and the Pakistan Telecommunications Authority (the “PTA”).

The MoIT&T is responsible for shaping and directing Pakistan’s telecommunications and information technology policies. The PTA is an autonomous body that, subject to government-issued instructions and policy directives, implements policy and monitors the activities of the various market participants through licensing, tariff regulation, investigation of complaints (including arbitration of disputes between licensees) and competition. Additionally, the Competition Commission of Pakistan regulates competition within the telecommunications sector under the Competition Act, 2010.

Telecommunications networks and services in Pakistan are principally regulated under the Telecommunications Act and the rules and regulations made thereunder (the “Telecommunications Rules”). The Telecommunications Act also defines general rules for the licensing and authorization of telecommunications networks and services and introduces principles of establishment and administration of special funds, which are intended for research and development and a universal services fund.

Cable Television is regulated under Pakistan Electronic Media Regulatory Authority (PEMRA) PEMRA Ordinance 2002 (and its amendments). PEMRA is an autonomous body that, subject to government-issued instructions and policy directives, implements policy and monitors the activities of the various market participants through licensing, and investigation of complaints (including arbitration of disputes between licensees).

The industry regulated by PEMRA falls under Ministry of Information and Broadcasting (MoIB) Government of Pakistan.

Telecom and Broadband Business Licenses

To obtain a license to provide data transmission and voice telecommunications services in Pakistan, the PTA requires a written application supported by relevant documents, as set out in the applicable regulations, and information memoranda or advertisements in respect of the relevant license.

To obtain a license to provide Cable TV and Media services in Pakistan, PEMRA requires a written application supported by relevant documents, as set out in the applicable regulations, and information memoranda or advertisements in respect of the relevant license.

Licenses for the provision of fixed telecommunications services in Pakistan are typically issued for 20 years and may be renewed on such terms and conditions, and with such fees and contributions, which are consistent with the policy of the Government of Pakistan (the “GoP”) at the time of expiration. The PTA may include such additional terms as it considers appropriate, or it may decline to renew a license for various reasons, including violations of applicable license terms, laws or regulations.

Licenses for Cable Television and Media transmission services in Pakistan are typically issued for 5 years by PEMRA and may be renewed on such terms and conditions, and with such fees and contributions, which are consistent with the policy of the “GoP” at the time of expiration. PEMRA may include such additional terms as it considers appropriate, or it may decline to renew a license for various reasons, including violations of applicable license terms, laws, or regulations.

Description of Moda in Pelle’s Operations

Overview

123 Investments Limited is the holding company of Moda in Pelle, a British women’s footwear and accessories business that has evolved over nearly five decades from a single independent shoe store into a national, omnichannel brand with a diversified product portfolio, loyal customer base, and what we believe is a scalable digital platform.

The Moda in Pelle story began in 1975, when founder Stephen Buck opened a small footwear store in Leeds, Yorkshire, England, inspired by Italian craftsmanship and a belief that women’s shoes could combine elegance, comfort, and quality at accessible price points. At a time when much of the UK footwear market was fragmented and locally focused, Moda in Pelle differentiated itself through design-led collections, premium leather materials, and a consistent aesthetic that was designed to resonate with British women.

What began as a single-location retail operation gradually expanded into a multi-store presence, as customer demand grew. By the late 1990s and early 2000s, the brand had successfully transitioned from an owner-operated retailer into a recognized national name, expanding through wholesale partnerships, department store concessions, and an increasing footprint in prime UK retail locations.

Over the decades, Moda in Pelle has navigated multiple retail cycles including shifts in consumer fashion preferences, economic downturns, and structural changes in traditional UK brick-and-mortar chains. Rather than pursuing rapid, debt-driven expansion, the business adopted a measured growth philosophy, prioritizing brand integrity, product quality, and customer loyalty.

This disciplined approach allowed Moda in Pelle to:

·
Sustain operations through periods of retail contraction;

·
Retain a loyal, repeat customer base; and

·
Preserve pricing power in the mid-to-premium footwear segment.

Management believes that the brand’s longevity is a direct result of its ability to evolve while remaining true to its core identity: fashion-forward design without compromising comfort or craftsmanship.

The most transformative phase in Moda in Pelle’s journey began in the 2010s, as consumer purchasing behavior shifted rapidly toward online channels. Anticipating this change, Moda in Pelle invested early in in-house retail technology, inventory visibility, and digital customer engagement tools. These investments enabled Moda in Pelle to scale its direct-to-consumer e-commerce platform while maintaining tight control over stock, pricing, and brand presentation.

By the early 2020s, the business had successfully repositioned itself as a digitally enabled omnichannel retailer, with sales increasingly balanced between physical retail and online channels. Currently approximately 50% of revenue is generated through physical stores and concessions and 50% through digital and partner channels, demonstrating the successful integration of traditional retail strengths with modern e-commerce capabilities.

Today, Moda in Pelle operates at a scale that management believes positions it as a meaningful participant in the UK women’s footwear market. Unlike many fashion retailers that rely on heavy promotional activity or rapid inventory turnover, Moda in Pelle employs a test-and-repeat buying model and disciplined inventory planning. This approach better enables the business to respond to customer demand in-season, reduce markdown exposure, and protect gross margins.

With nearly 50 years of operating history, an email list exceeding 500,000, and proprietary retail technology developed over decades, Moda in Pelle believes it has transitioned from a founder-led retailer into a scalable brand platform.

The next phase of Moda in Pelle’s journey is focused on:

·
Expanding digital reach and personalization;

·
Selective store and concession growth in high-quality locations;

·
International expansion through capital-light channels; and

·
Leveraging data and technology to deepen customer relationships.

Management believes Moda in Pelle’s transformation from a single Leeds store into a national omnichannel brand, demonstrates its ability to adapt, endure, and grow, positioning the business not as a legacy retailer, but as a heritage brand entering its next chapter.

Moda in Pelle’s strategy is to balance brand‑led physical retail with scalable digital and partner‑led channels, while maintaining pricing discipline and operational control across its portfolio.

Moda in Pelle’s Product Range

Moda in Pelle offers a broad and carefully balanced product range designed to meet the lifestyle needs of modern women, while remaining consistent with the brand’s premium positioning and design ethos. Moda in Pelle’s product portfolio spans footwear and accessories, structured to deliver both commercial resilience and fashion relevance across seasons, occasions, and customer preferences. Management believes this diversity underpins consistent demand, reduces reliance on any single category, and supports repeat purchasing behavior.

The product mix is deliberately weighted toward core footwear categories, with an emphasis on everyday wearability complemented by fashion-led and occasion-specific styles. The portfolio reflects a balance between casual and smart footwear, enabling the brand to capture demand across work, leisure, travel, and social use cases.

Footwear Categories and Product Mix

Moda in Pelle’s footwear offerings represent the majority of product sales and are diversified across multiple core categories:

·

Short Boots

Short boots represent the largest single category within the product range. This category has historically benefited from strong year-round demand, with heightened performance during autumn and winter seasons. Styles range from casual ankle boots to more refined silhouettes suitable for work and evening wear, reflecting Moda in Pelle’s ability to combine comfort with contemporary design.

·

Trainers

Trainers have become a core growth category, reflecting broader consumer shifts toward casualization and comfort-led fashion. Moda in Pelle’s trainers combine premium materials, elevated design details, and wearable silhouettes, with the goal of positioning them distinctively within the mid-to-premium market. This category supports cross-seasonal sales and attracts both existing customers and new, style-conscious consumers.

·

Sandals

Sandals form a significant seasonal category, performing strongly during spring and summer months. The range includes casual flats, platform styles, and more refined designs, enabling the brand to maintain relevance across holiday, leisure, and everyday use.

·

Shoes

The shoes category includes loafers, heels, and smart casual styles. While representing a smaller proportion of the overall mix, this category plays a key role in reinforcing Moda in Pelle’s heritage in classic, elegant footwear and serves customers seeking polished, versatile designs.

·

Long Boots

Long boots are a strategically important seasonal category, contributing to higher average selling prices and reinforcing the brand’s premium credentials. These products typically feature higher material input and craftsmanship, aligning closely with the brand’s heritage positioning.

·

Bags and Accessories

Bags and accessories complement the footwear range and support outfit-building and cross-selling opportunities. While representing a smaller share of total sales, this category enhances brand lifestyle appeal and increases basket size, particularly in digital channels.

Casual vs. Smart Positioning

Across all categories, the product range is intentionally skewed toward casual footwear, which represents approximately 65% of the total range, compared to 35% classified as smart footwear. This mix reflects evolving consumer preferences toward versatility, comfort, and multi-occasion use, while still maintaining a meaningful presence in more formal and dress-oriented styles.

Management believes this balance enables Moda in Pelle to remain relevant across changing fashion cycles and economic conditions, as casual footwear tends to demonstrate more stable demand patterns, while smart footwear contributes to brand elevation and margin enhancement.

Design Consistency and Range Architecture

The product range is underpinned by a consistent design architecture, developed by Moda in Pelle’s in-house design and buying teams. Collections are built around cohesive seasonal themes, with curated color palettes, materials, and silhouettes that allow individual products to stand alone while remaining part of a recognizable Moda in Pelle aesthetic.

This approach enables Moda in Pelle to:

·
Offer trend-led statement pieces alongside core, repeatable styles;

·
Refresh collections frequently without diluting brand identity; and

·
Support test-and-repeat buying strategies and in-season trading agility.

Commercial Resilience of the Range

Management believes the breadth and structure of the product range provides commercial resilience, particularly in a fashion-driven industry. By avoiding over-concentration in a single product type or trend, Moda in Pelle is able to better:

·
Smooth revenue across seasons;

·
Respond quickly to changes in customer demand; and

·
Optimize inventory deployment across retail, e-commerce, and partner channels.

Moda in Pelle’s omnichannel product range model also contributes to overall margin and stock efficiency, as different categories have been found to perform better across different channels (e.g., trainers and short boots online; long boots and smart shoes in store).

Brand Journey and Evolution

Moda in Pelle’s brand journey began with Moda in Pelle, a heritage British footwear brand founded in 1975 and built on the principles of quality, craftsmanship, and feminine design. For several decades, Moda in Pelle operated as a single-brand business, serving a loyal and increasingly affluent customer base through physical retail and, later, digital channels. As the brand matured, management recognized that long-term growth would require a more deliberate segmentation strategy—one that could capture customers at different life stages, price sensitivities, and style preferences without diluting the core brand.

Rather than stretching a single brand to serve all customers, Moda in Pelle adopted a portfolio-based approach, developing and acquiring complementary brands that sit alongside Moda in Pelle. This evolution has allowed Moda in Pelle to expand its addressable market while maintaining clear brand identities, disciplined pricing architecture, and margin control.

The Flagship: Moda in Pelle

Moda in Pelle remains the cornerstone of Moda in Pelle’s portfolio and its primary revenue and brand equity driver, producing approximately 70% of annual revenues. The brand targets women aged approximately 30–55 with mid-to-high disposable income, offering premium footwear and accessories that combine contemporary fashion with comfort and durability. Products are positioned in the mid-to-premium segment, emphasizing quality materials, distinctive design details, and wearability across multiple occasions.

The flagship brand benefits from a long operating history and strong customer loyalty, with an average annual customer spend of approximately £85 ($115) (representing the purchase of one pair of footwear per year, based on the average purchase price of Moda in Pelle footwear). Management views Moda in Pelle as the “anchor brand” that defines Moda in Pelle’s aesthetic standards, sourcing philosophy, and quality benchmarks, while also serving as the natural migration point for customers who enter Moda in Pelle through its other brands.

Shoon: Comfort, Classicism, and Longevity

Shoon represents Moda in Pelle’s comfort-led and classic footwear proposition. Designed primarily for women aged 40–55 with mid-to-higher income levels, Shoon emphasizes timeless silhouettes, practicality, and long-lasting comfort. The brand seeks to appeal to customers who prioritize wearability and quality over fast-moving fashion trends.

Shoon is positioned to attempt to provide stability within the portfolio, as management has seen that demand for classic and comfort-focused footwear tends to be less volatile across fashion cycles. Management believes Shoon complements Moda in Pelle by serving a customer segment with different purchasing motivations, while still aligning with Moda in Pelle’s overall commitment to craftsmanship and quality.

M by Moda: The Entry Point for a New Generation

Launched in 2018, M by Moda was created to address a younger demographic without diluting the premium positioning of the flagship brand. Targeting women aged approximately 25–35 with mid-range income, M by Moda seeks to offer trend-led footwear at more accessible price points. The brand draws inspiration from catwalk trends and contemporary styling, often using alternative and synthetic materials while retaining Moda in Pelle’s design DNA.

With an average annual customer spend of approximately £50 (approximately $68 as of March 24, 2026) (representing the purchase of one pair of footwear per year, based on the average purchase price of M by Moda footwear), M by Moda functions as an entry-level brand within Moda in Pelle. Management believes M by Moda plays a strategic role in introducing younger consumers to Moda in Pelle’s aesthetic and building long-term customer relationships that can migrate upward into Moda in Pelle as purchasing power increases.

French Dressing: Effortless Elegance Across the Day

French Dressing extends Moda in Pelle’s portfolio into refined, versatile fashion. Positioned around effortless elegance, the brand is designed for discerning women who value quality, sophistication that transitions seamlessly from daytime wear to evening occasions. French Dressing combines timeless design with a confident, modern edge, appealing to customers who seek understated style rather than overt trend-driven fashion.

This brand enhances ‘Moda in Pelle’s lifestyle positioning and supports cross-category and cross-brand engagement, reinforcing Moda in Pelle’s ambition to serve customers beyond single-occasion footwear purchases.

Bsoleful: Sustainability-Led Fashion Footwear

Bsoleful represents Moda in Pelle’s response to growing consumer demand for sustainability-focused fashion. The brand is positioned as fashion-forward footwear designed with sustainability considerations at its core, including material selection and responsible sourcing principles.

Bsoleful allows Moda in Pelle to participate in a rapidly expanding segment of the footwear market while testing sustainable concepts without imposing constraints on the core Moda in Pelle brand. Management views Bsoleful as both a growth opportunity and a learning platform that informs sustainability initiatives across the wider portfolio.

Emma Somerset: Heritage Reinterpreted

Emma Somerset, acquired by Moda in Pelle in 2008, is a contemporary fashion brand with a heritage extending over 60 years. The brand attempts to blend classic footwear influences with modern styling, appealing to customers who appreciate heritage craftsmanship interpreted through a contemporary lens.

The acquisition of Emma Somerset marked an important milestone in Moda in Pelle’s evolution, demonstrating its ability to integrate established brands into its operating platform while preserving their individual identity and customer appeal.

Moda Footwear: Designed to Be Worn and Remembered

Moda Footwear represents a contemporary expression of Moda in Pelle’s design philosophy. The brand focuses on footwear that is both distinctive and wearable, designed to leave a lasting impression while remaining practical for everyday use. Moda Footwear supports Moda in Pelle’s broader strategy of offering differentiated products that attempt to resonate emotionally with customers, reinforcing brand recall and repeat purchasing.

Strategic Rationale for the Portfolio

Taken together, Moda in Pelle’s brand portfolio reflects a deliberate evolution rather than opportunistic expansion. Each brand attempts to serve a clearly defined customer segment, price point, and style orientation, with the goal of allowing Moda in Pelle to:

·
Expand its addressable market across age, income, and lifestyle profiles;

·
Preserve clear brand positioning and avoid internal cannibalization;

·
Maintain pricing discipline and margin governance; and

·
Reduce reliance on a single fashion cycle or customer cohort.

Market Positioning

Moda in Pelle believes that it occupies a distinct and defensible position within the UK women’s footwear market, being positioned above mass-market and comfort-led footwear retailers, yet below ultra-luxury fashion houses, which management believes allows it to serve customers seeking elevated design, quality materials, and comfort, without the exclusivity or price volatility associated with luxury brands.

The brand’s positioning is reinforced by its core customer profile, which centers on women aged 30 to 55, with mid-to-higher disposable income, an affluent lifestyle, and a preference for sophisticated, feminine footwear. Experience has shown that these customers are not impulse-driven fast-fashion shoppers; rather, they view footwear as an investment and demonstrate high repeat-purchase behavior and long customer lifetimes.

Importantly, Moda in Pelle’s goal is for its market positioning to be channel-agnostic but brand-consistent, with the brand presenting a unified premium identity. Management believes that this consistency supports customer trust, pricing discipline, and long-term brand equity, while enabling the business to scale across multiple retail formats without diluting its positioning.

Moda in Pelle’s market position is further strengthened by its portfolio strategy, which seeks to allow Moda in Pelle to address adjacent segments without compromising the core brand. M by Moda is designed to serve a younger, more fashion-experimental customer at accessible price points, while Shoon’s goal is to appeal to customers seeking classic, comfort-led footwear. Together, these brands attempt to protect Moda in Pelle’s positioning by allowing it to remain focused on its core customer, while still capturing broader market demand.

Moda in Pelle believes that its uniqueness is rooted in a combination of heritage, design integrity, operational capability, and customer intimacy:

·

At the heart of the brand is a fully in-house design capability, with collections conceived, developed, and refined by an experienced internal team. Designs are not derivative or outsourced; they are purposefully created to be distinctive, premium, and consistently contemporary.

·

Management believes that heritage plays a central role in this differentiation. With nearly 50 years of continuous operation, Moda in Pelle is not a trend-led start-up brand but a proven business that has evolved through multiple fashion and retail cycles. This heritage seeks to underpin customer trust and reinforce perceptions of quality and craftsmanship.

·

Operationally, Moda in Pelle attempts to distinguish itself through a highly developed multichannel infrastructure supported by proprietary technology. Its in-house IT systems provide real-time stock visibility across stores, warehouses, and online platforms, with the goal of enabling seamless product logistics and reducing lost sales. This capability supports the brand’s test-and-repeat buying model, which allows it to respond quickly to demand, reduce lead times, and minimize inventory risk — which Moda in Pelle believes is a structural advantage over many traditional footwear retailers.

·

Management believes that another defining element of Moda in Pelle’s uniqueness is management’s belief, based on repeat company sales, that it has a loyal and affluent customer base. Moda in Pelle’s customer database has grown rapidly, with returning customers accounting for approximately 35% of sales in calendar 2025 (i.e., 35% of sales were the result of purchasers who purchased more than one time in 2025) and strong engagement across both physical and digital channels.

·

Finally, management believes that Moda in Pelle’s uniqueness is sustained by its experienced and stable leadership team, combining long-tenured executives with targeted new hires in technology, people, and digital growth roles. This blend of continuity and renewal is expected to allow the brand to preserve its core values while executing a forward-looking growth strategy.

Competitive Landscape

Management believes that the global footwear industry represents one of the most resilient and structurally expanding segments within the broader consumer and lifestyle sector. According to a June 2024 report by Spherical Insights, the global footwear market size was valued at $356.2 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of 4.5% from 2023 to 2033, and reach an estimated size of $553.2 billion by 2033. Spherical Insights believes the primary drivers of the market’s expansion include demand for athletic footwear, the growing demand made possible by e-commerce, and the significant advertising expenditures made by footwear firms, and the increase in demand for fashionable, comfortable footwear.

Within this global context, the UK footwear market is projected to grow from $15.0 billion in 2024 to $18.9 billion in 2030, a CAGR of 3.9%, according to a report by Grand View Horizon. Although the UK market is projected for a lower CAGR compared to the rest of the world, it continues to be projected to expand at a stable pace.

Management believes that a defining characteristic of the modern footwear industry is the blurring of traditional category boundaries, particularly between athletic and non-athletic footwear. Consumers increasingly seek versatile products that combine comfort, performance attributes, and everyday style. Moda in Pelle has seen this shift expand the addressable market for brands positioned between classic fashion footwear and purely athletic offerings.

Another major structural trend shaping the industry is the continued migration toward digital and omnichannel purchasing behavior.

Moda in Pelle has found that consumers increasingly expect seamless integration between physical retail, e-commerce, and third-party marketplaces and believes that brands that combine experiential retail environments with strong digital execution, are better positioned to capture customer attention, improve conversion, and retain long-term loyalty. This trend has accelerated competition but has also created opportunities for differentiated brands with strong customer insight, proprietary systems, and disciplined inventory management.

Sustainability has also emerged as a central purchasing consideration within the footwear and fashion industries. Management believes that consumers increasingly expect brands to take responsibility for environmental and social impacts, particularly in relation to materials sourcing, production practices, waste reduction, and product longevity. Moda in Pelle considers sustainability not as a niche differentiator but as an industry-wide expectation, where experience has shown that customers increasingly favor brands that embed ethical and environmental considerations into their design and sourcing decisions without compromising quality or style.

Distribution Channels

Moda in Pelle distributes its products through an integrated multi-channel model consisting of owned retail stores, concessions, wholesale partnerships, and direct-to-consumer online sales, supplemented by third-party digital marketplaces (each as discussed in greater detail below). Management believes that this diversified distribution structure allows Moda in Pelle to expand market reach, manage inventory efficiently, and reduce reliance on any single sales channel.

Moda in Pelle’s distribution channels are managed centrally, with inventory visibility across channels supported by in-house technology systems. Products are sourced and allocated across channels based on expected demand, historical performance, and margin considerations.

Retail Stores

Retail stores represent a core component of Moda in Pelle’s distribution strategy and are primarily located in the UK. Moda in Pelle operates a network of standalone retail stores, outlets, and concessions, with a total retail footprint of approximately 39 locations, consisting of standalone stores, concessions, and outlets.

The retail estate is designed around a small-footprint store model, with average store sizes historically averaging approximately 500 square feet, increasing to approximately 700 square feet in newer locations, and up to 1,500 square feet in selected recent store formats. New store designs are standardized and cost-engineered to support efficient deployment and consistent customer experience.

Store openings are subject to defined investment and performance criteria, including targeted contribution levels, expected payback periods of less than one year, and flexible lease structures, typically with five-year terms and break options. Retail locations are selected based on demographic data, expected footfall, and historical performance of comparable stores. Retail stores also support omnichannel functionality, including in-store returns and fulfillment of online orders, which management believes improves inventory utilization and customer service.

Moda in Pelle’s growth strategy includes the selective opening of new retail stores in the UK. Moda in Pelle’s management plans to expand the retail estate through a structured rollout program over the next several years, subject to market conditions and performance of existing stores.

Each proposed store opening is evaluated based on certain expected criteria and are typically deployed using standardized designs and modular fixtures to manage costs and reduce implementation risk.

Moda in Pelle’s retail stores are discussed in greater detail below under “Item 2. Properties”.

Wholesale Distribution

Wholesale distribution supplements Moda in Pelle’s direct retail and online operations and provides access to additional customer segments and geographic markets. Wholesale partners include department stores, television retail platforms, and independent retailers, with a focus on maintaining brand alignment and controlled product assortments.

Key wholesale relationships include QVC, Frasers Group, and a limited number of independent retail accounts. Wholesale arrangements typically involve agreed product ranges, minimum order values, and defined delivery schedules. While wholesale sales generally generate lower gross margins than direct-to-consumer channels, management believes wholesale distribution contributes to overall scale, brand visibility, and inventory throughput. Moda in Pelle periodically evaluates opportunities to expand wholesale distribution, including potential international wholesale arrangements, subject to commercial terms and brand considerations.

Online Operating Model

Moda in Pelle operates a direct-to-consumer e-commerce platform at www.modainpelle.com, which is a significant component of its distribution strategy. Online sales are conducted through Moda in Pelle’s proprietary website and through selected third-party online marketplaces.

The online platform is supported by in-house technology systems that provide real-time inventory visibility, customer data management, and integration with retail and warehouse operations. Online sales are fulfilled from a centralized stock pool that also serves physical retail locations.

Moda in Pelle’s online operations have demonstrated growth over recent years, with total online demand increasing from approximately $5.98 million in 2018 to approximately $28.16 million through December 31, 2025, supported by increased website traffic, customer database growth, and digital marketing investment.

Third-party online partners include John Lewis, Next, Debenhams, and certain other digital marketplaces. Moda in Pelle actively manages pricing, stock allocation, and promotional activity across these platforms to balance sales volume and margin.

Concessions

A retail concession is an arrangement under which Moda in Pelle is permitted to operate a branded retail presence within space owned or controlled by a third party, such as a retail or department store, without leasing a standalone location. Under these arrangements, Moda in Pelle generally occupies a relatively small physical footprint and does not hold a traditional leasehold interest in the space. Concessions form a capital-efficient component of Moda in Pelle’s physical distribution strategy. Moda in Pelle operates concessions within selected department store partners, including John Lewis, where products are displayed and sold within designated in-store spaces.

Moda in Pelle’s current concession strategy includes:

·
Expanding existing concession footprints within partner stores;

·
Increasing the number of fixtures per location; and

·
Deploying trained brand representatives in selected locations.

These arrangements typically involve a relatively small physical footprint and generally continue in effect until terminated by either party (subject in most cases to required six months’ notice). Under these concession arrangements, the Company is responsible for staffing, operating, and managing the concession, including the engagement and payment of all personnel. In addition, the Company is generally required to remit to the venue operator a percentage of gross revenue or sales generated at the concession location and in certain cases guaranty a minimum yearly fee. Concessions typically involve lower upfront investment and reduced fixed costs compared to standalone stores, as occupancy and certain operating expenses are shared with the host retailer. Management believes this model allows Moda in Pelle to increase physical presence while limiting capital exposure.

Channel Integration

Moda in Pelle manages its distribution channels on an integrated basis, with centralized inventory management and unified customer data systems. Management believes this approach supports efficient allocation of inventory, reduces lost sales, and enhances the customer experience across retail, online, and wholesale channels.

Sourcing Approach

Moda in Pelle operates a globally diversified sourcing model designed to balance product quality, supply reliability, ethical standards, and commercial efficiency. Products are sourced from a carefully curated network of manufacturing partners located across multiple geographies, selected based on their footwear craftsmanship expertise, production capabilities, and alignment with Moda in Pelle’s quality and compliance standards. Management believes that this diversified sourcing strategy reduces dependence on any single supplier or region while enabling flexibility in production planning and cost management.

Prior to delivery into the Moda in Pelle supply chain, each product undergoes a stringent multi-stage quality and compliance process. This process includes repeated fitting and wear trials conducted by Moda in Pelle’s in-house quality control team to validate comfort, durability, and fit. Size grading and final production are not approved until products meet internal performance standards. In addition, wearer trials are conducted in real-world environments to assess product performance under normal customer use conditions.

Moda in Pelle works with independent, internationally recognized testing houses, including Société Générale de Surveillance (SGS), QIMA, and the British Leather Confederation (BLC), to ensure products comply with applicable legal, safety, and material standards. Materials are reviewed by the buying and quality assurance teams to ensure specialist leathers, components, and finishes meet design intent and quality expectations prior to approval for production. Management believes this layered testing and approval framework supports consistent product quality across all brands within Moda in Pelle.

Moda in Pelle maintains a formal supplier code of conduct that applies across all of its brands. This code of conduct is based on the Ethical Trading Initiative (ETI) Base Code and requires compliance with standards relating to labor practices, health and safety, and ethical operations. Compliance is verified through periodic factory audits and documentation reviews conducted using recognized frameworks such as SMETA (Sedex Members Ethical Trade Audit) and BSCI (Business Social Compliance Initiative), supplemented by factory visits where deemed appropriate.

In sourcing leather and related materials, Moda in Pelle is a member of the Leather Working Group (LWG) and works with accredited tanneries to support responsible and traceable leather production. Management believes that participation in LWG initiatives supports continuous improvement in environmental practices within the leather supply chain while maintaining the aesthetic and performance characteristics required for premium footwear.

Moda in Pelle’s supply base is intentionally concentrated but diversified (see additional information below), with approximately 53% of the product range produced by the top five suppliers, all of whom support production across Moda in Pelle’s three brands. Management believes this structure allows Moda in Pelle to leverage scale, pricing, and production capacity, while maintaining flexibility and reducing execution risk. Supplier performance is monitored on an ongoing basis, with a focus on quality, delivery reliability, and responsiveness to in-season production requirements.

The Moda in Pelle “Buying Model” Difference

Moda in Pelle operates a test-and-repeat and trend-responsive buying model that management believes differentiates it from traditional footwear retailers and contributes to improved inventory efficiency, reduced lead times, and enhanced gross margin performance. This buying model is designed to align production commitments more closely with observed customer demand, rather than relying solely on long-range forecasting.

Under the Moda in Pelle buying model, approximately 50% of seasonal quantities are committed prior to the selling season, compared to approximately 80% under a standard industry buying model. The remaining volume is allocated dynamically, including approximately 35% to in-season repeat orders, 5% to trend-driven in-season buys, and 10% to test lines introduced to assess customer response. This structure enables continuous product development throughout the season rather than a fixed development cycle established up to 12 months in advance, as is common in traditional footwear retail models.

Average delivery lead times under the Moda in Pelle buying model are approximately 10 weeks, which management believes is faster than many in the industry. In addition, Moda in Pelle’s supplier relationships have historically allowed for average lead times of approximately four weeks on repeat orders, supported by phased shipment quantities and production capacity reserved by key manufacturing partners. Management believes these shorter lead times enhance responsiveness to best-selling products and reduce the risk of missed sales opportunities during peak trading periods.

The effectiveness of this buying model is underpinned by long-standing, trusted supplier relationships, under which Moda in Pelle is prioritized as a key customer. These relationships allow Moda in Pelle to place orders at smaller minimum order quantities than industry norms, reducing upfront capital commitments and inventory risk.

Management believes that the Moda in Pelle buying model allows Moda in Pelle to:

·
Reduce inventory exposure and markdown risk;

·
Improve sell-through rates on core and trend-led products;

·
Enhance gross margin stability across seasons; and

·
Support faster speed-to-market while maintaining quality standards.

This flexible, data-driven approach to buying and sourcing is a central component of Moda in Pelle’s operating model and is designed to support sustainable growth while preserving brand integrity and profitability.

Largest Sourcing Locations*

Location

Year Ended

December 31,

2025

Year Ended

December 31,

2024

European Union

27 %

54 %

China

42 %

31 %

India

30 %

12 %

Others

1 %

2 %

* May not total to 100% due to rounding.

Trends Affecting Business

Fashion Trends and Consumer Preferences

The footwear industry is subject to changes in fashion trends, consumer tastes, and lifestyle preferences, which may affect product demand, inventory planning, and pricing dynamics. Moda in Pelle has in recent years seen increased consumer preference for footwear that combines contemporary design with comfort and versatility, rather than purely trend-driven or formal styles. This shift is reflected in Moda in Pelle’s current product mix, in which casual footwear represents a majority of the offerings.

Fashion trends have also become more fluid and less predictable, which Moda in Pelle attributes to digital media, social platforms, and rapid dissemination of global styles. These dynamics may increase the risk of misalignment between product offerings and customer demand. As a result, forecasting accuracy and responsiveness to in-season demand are increasingly important factors affecting performance. As a result of the above, Moda in Pelle may not be able to consistently anticipate or respond effectively to future fashion trends.

At the same time, Moda in Pelle’s core customer demographic has shown continued interest in footwear positioned as durable and long-lasting, rather than disposable. While this trend supports demand for premium materials and craftsmanship, it may also limit the frequency of repeat purchases compared to fast-fashion categories and could affect sales growth rates during periods of reduced discretionary spending.

Seasonality and Weather-Related Demand Variability

Moda in Pelle’s business is subject to seasonal fluctuations that are typical of the footwear industry. Sales are generally stronger during the autumn and winter seasons, when demand for boots and closed footwear is higher, and during promotional periods. Conversely, demand patterns during spring and summer may vary depending on weather conditions and consumer travel behavior.

Unseasonal UK weather patterns, including warmer-than-expected winters or prolonged adverse weather conditions, may negatively impact demand for certain product categories. While Moda in Pelle employs phased inventory deliveries and in-season replenishment strategies to manage seasonality, these measures may not fully mitigate the effects of unexpected demand shifts or regional weather variations.

Seasonality also affects working capital requirements, inventory levels, and cash flows throughout the year.

Shift Toward Online and Omnichannel Shopping

The footwear sector has in recent years experienced a sustained shift toward online shopping and omnichannel purchasing behavior. Customers increasingly expect the ability to browse, purchase, and return products across digital platforms and physical retail locations. The digital channels now represent a significant portion of industry sales and have grown more rapidly than traditional brick-and-mortar formats in recent years.

This trend has increased competition in online channels, including from digitally native brands and large multi-brand platforms. For Moda in Pelle, it has also contributed to rising customer acquisition costs, higher return rates, and increased operational complexity related to fulfillment and inventory visibility.

Sustainability Expectations and Regulatory Considerations

Consumer awareness of environmental and social issues has increased expectations for responsible sourcing, product transparency, and sustainability initiatives within the footwear industry. Moda in Pelle management has also identified sustainability as an area of growing importance to customers and industry stakeholders. In connection therewith Moda in Pelle has implemented initiatives aimed at reducing environmental impact and improving sourcing practices.

Digital Marketing, Data Usage, and Customer Engagement

The increased importance of digital channels has heightened the role of data-driven marketing, customer segmentation, and personalization. Moda in Pelle has expanded its use of digital marketing tools and customer analytics, consistent with broader industry practices.

However, these trends also expose Moda in Pelle to risks related to data privacy, cybersecurity, and regulatory compliance, including evolving data protection laws. In addition, digital marketing effectiveness may be affected by changes in advertising platform policies, consumer data availability, and competitive bidding dynamics.

Macroeconomic Conditions and Discretionary Spending

Demand for Moda in Pelle’s products is influenced by broader macroeconomic conditions, including inflation, interest rates, employment levels, and consumer confidence. As a discretionary retail category, footwear purchases may be deferred or reduced during periods of economic uncertainty.

While Moda in Pelle’s products are positioned in the mid-to-premium segment and attempt to emphasize quality and longevity, prolonged economic downturns or sustained pressure on household disposable income could adversely affect sales volumes, margins, and inventory turnover.

Overall Impact of Trends

The trends described above affect Moda in Pelle’s operating environment, cost structure, demand patterns, and competitive positioning. Management monitors these developments and adjusts strategies accordingly; however, Moda in Pelle’s future performance will depend on its ability to respond effectively to changing consumer behavior, market conditions, and regulatory requirements.

Moda in Pelle’s operations are dependent on the skills, experience, and engagement of its employees across retail, digital, operational, and corporate functions. Management believes that maintaining an appropriately structured workforce, supported by experienced leadership and aligned cultural practices, is essential to executing Moda in Pelle’s brand-led, omnichannel business model and long-term growth strategy.

Employees and Human Capital Resources

Workforce Overview

Moda in Pelle employs personnel across retail store operations, concessions, warehouse and logistics, head office functions, and technology development. The workforce is primarily based in the UK, reflecting Moda in Pelle’s core operating footprint. Retail employees represent the largest portion of the workforce and are responsible for customer engagement, in-store execution, and brand representation across standalone stores, concessions, and outlet locations.

Centralized teams support retail operations through merchandising, supply chain coordination, marketing, e-commerce, finance, human resources, and information technology. Moda in Pelle operates an in-house warehouse and logistics function in Leeds, England, staffed by approximately 20 senior management employees, supporting store replenishment and e-commerce fulfillment through a centralized stock pool model. The table below discloses employees by department as of the date of this Report:

Department

Number of Employees

Buying

6

Customer Services

4

Design

4

Directors

3

E-commerce & Marketing

7

Finance

5

HR

2

IT

7

Merchandising

7

PA

1

Quality Control

2

Retail

148

Warehouse

24

Total headcount

220

Leadership Structure and Management Continuity

Moda in Pelle is led by an executive management team with substantial experience in fashion retail, footwear, digital commerce, and operational management. Several senior leaders have long tenure within the business, providing continuity and institutional knowledge. Management believes this stability supports disciplined decision-making, consistent brand execution, and effective risk management.

Key leadership functions include retail operations, buying and merchandising, marketing and e-commerce, finance, technology, and people and culture. Moda in Pelle maintains in-house leadership and technical expertise in areas such as retail systems, inventory management, and digital platforms, which management believes enhances operational control and reduces reliance on third-party providers.

Intellectual Property

We do not hold any patents. World Call Public holds a trademark registered with The Trademarks Registry, Karachi, Government of Pakistan, including the “WorldCall logo”. We also rely on trade secret protection for our confidential and proprietary information.

We believe that our ability to preserve the confidentiality of our trade secrets, seismic data and interpretations thereof, and operate without violating the intellectual property rights of others will be important to our success. We plan to rely on a combination of patent (where applicable, provided we do not currently have any patents or pending patents), trademark, copyright, trade secret, including federal, state and common law rights in the United States and other countries, nondisclosure agreements, and other measures to protect our intellectual property. Despite any measures taken to protect our intellectual property, unauthorized parties may attempt to copy aspects of our products or to obtain and use information that we regard as proprietary. Our business is affected by our ability to protect against misappropriation and infringement of our intellectual property and other proprietary rights.

Our intellectual property includes the content of our websites, our registered domain names, our registered and unregistered trademarks, and certain trade secrets.

Trade Marks and Intellectual Property Assets

Moda in Pelle owns or controls a portfolio of registered trademarks that are material to its business and brand identity, including:

Trademark

Jurisdiction

Status

First Use (Approx.)

Moda in Pelle

UK / EU

Registered

1975

Shoon

UK

Registered

1982

M by Moda

UK / EU

Registered

2018

BSoleful

UK

Registered

2020

These trademarks are owned by Moda in Pelle and are not subject to royalty payments to third parties. Management believes that brand names and trademarks represent one of Moda in Pelle’s most significant intangible assets.

E-Commerce and Digital Properties

Moda in Pelle believes that its e-commerce and digital infrastructure constitute a core operating asset supporting its omnichannel retail strategy. Digital properties enable Moda in Pelle to generate revenue directly, support third-party marketplace partnerships, integrate inventory across channels, and collect and analyze customer data at scale.

As of the most recent fiscal year, approximately 50% of total revenue was generated through digital channels, including Moda in Pelle’s proprietary e-commerce website and third-party online partners. Management believes that the digital channel provides scalable growth opportunities with lower marginal costs compared to physical retail expansion and is central to Moda in Pelle’s medium- and long-term strategy.

Moda in Pelle’s e-commerce platform is supported by its proprietary Retail Assistant system, which integrates inventory management, order fulfillment, merchandising, and customer data across physical and digital channels. Moda in Pelle does not currently monetize this system independently of its retail operations.

Third-Party Digital Marketplaces

In addition to its proprietary platform, Moda in Pelle distributes products through third-party digital marketplaces and online retail partners. These arrangements provide access to large, established customer bases and incremental demand, without significant capital investment in physical infrastructure. Key online partners are:

Partner

Channel Type

Relationship

John Lewis

Online concession

Ongoing

Next

Online marketplace

Ongoing

Debenhams

Online marketplace

Ongoing

QVC

Televised & digital

Ongoing

Frasers

Wholesale / digital

Ongoing

These digital assets are not owned real property but are material operating platforms supporting revenue generation. Sales through third-party platforms are generally conducted at lower gross margins than direct-to-consumer sales but require less marketing spend and working capital investment. Moda in Pelle does not rely on any single third-party technology provider for the continued operation of its e-commerce platform.

Human Capital Strategy and Talent Development

Moda in Pelle’s human capital strategy is designed to ensure that the organization has the skills and leadership capacity required to support its operational and growth objectives. This strategy emphasizes role clarity, performance management, and targeted development rather than broad-based expansion of headcount.

Management focuses on:

·
Aligning employee objectives with strategic priorities;

·
Developing leadership capability to support store expansion, digital growth, and operational scale; and

·
Maintaining succession planning for key roles.

Training and development initiatives are structured to support both functional expertise and leadership effectiveness, particularly in retail operations, buying, merchandising, and digital disciplines.

Employee Engagement and Retention

Management believes employee engagement and retention are important to maintaining consistent customer experience and operational performance. Moda in Pelle seeks to promote engagement through clear communication of business objectives, alignment between individual performance and business outcomes, and a culture that emphasizes accountability and collaboration.

Moda in Pelle’s employer proposition is aligned with its consumer brand values, emphasizing product quality, design integrity, and long-term brand stewardship. Management believes this alignment contributes to employee retention, particularly among experienced retail, design, and operational personnel.

Human Capital as an Enabler of Strategy

Management views human capital as an enabler of Moda in Pelle’s operating model, rather than a standalone growth driver. Moda in Pelle’s ability to design differentiated products, manage inventory efficiently, operate profitable retail locations, and scale digital channels, depends on maintaining a workforce with appropriate experience and functional capability.

As Moda in Pelle pursues continued growth through planned store expansion, e-commerce scaling, and selective international initiatives, management expects to continue investing in leadership capability, operational expertise, and workforce engagement to support execution while maintaining cost discipline.

Strategy and Outlook

Strategic Direction

123 Investments Limited expects its future performance to be driven by the continued strength of its brands like Moda in Pelle, Shoon, M By Moda, French Dressing, Besoleful, Emma Somerset, and Moda Footwear. Management is focused on a planned disciplined expansion across digital and third-party channels, selective geographic diversification, and increased deployment of technology with the goal of enhancing operational efficiency and customer engagement.

Management’s strategic direction for the next twelve months is focused on working to scale revenue, improve profitability, and strengthen liquidity, while maintaining disciplined cost management and prudent capital allocation. Key operational priorities to support these objectives include seeking (i) revenue growth across core channels, with emphasis on improving performance in higher-margin channels, while maintaining appropriate scale across wholesale and partner relationships; (ii) gross margin stabilization, through tighter inventory planning, reduced markdown exposure, and optimization of channel mix; (iii) administrative cost discipline, seeking to align overhead growth, revenue growth and operating scale; and (iv) continued enhancement of systems and data capabilities, particularly in demand forecasting, inventory allocation, and working capital management, to support more efficient execution.

Management believes these initiatives are achievable within the existing operating framework, subject to market conditions and execution risks. To execute the business plan described above, Moda in Pelle expects to require additional working capital funding during the next twelve months, primarily to support inventory purchases, seasonal operating requirements, and general corporate purposes. Funding requirements are expected to fluctuate during the year based on sales seasonality, inventory cycles, and the timing of receivables collections.

Management expects Moda in Pelle’s funding needs over the next twelve months to be met through a combination of (i) cash flows from operations; (ii) existing financing arrangements and trade credit, subject to availability and market conditions; and (iii) expected funding support of up to $3.0 million from the Company pursuant to the terms of the Exchange Agreement, intended to support working capital requirements. However, management also continues to focus on improving internal cash generation and working capital efficiency to reduce reliance on external funding sources over time.

Technology as a Core Growth Enabler

Technology adoption is expected to play an increasingly central role in Moda in Pelle’s future operating model. A key pillar of Moda in Pelle’s strategy is the continued enhancement and commercialization of its proprietary Retail Assistant technology, which has been developed in-house over several decades and reflects deep domain expertise in footwear retail operations.

Moda in Pelle anticipates that, over time, advanced analytics and AI-enabled features, potentially developed in collaboration with the Company could further differentiate Moda in Pelle’s digital capabilities, strengthen competitive positioning, and support scalable growth across both owned and partner channels.

Channel Mix and Digital Expansion Outlook

Management expects digital channels, including direct-to-consumer e-commerce and third-party online marketplaces, to remain the primary drivers of revenue growth. Online traffic, conversion rates, and partner-led digital sales, are expected to increase as a result of improved platform performance, expanded partner relationships, and targeted marketing initiatives.

Wholesale and third-party distribution channels are expected to provide additional scale and brand visibility, although management recognizes that these channels typically operate at lower gross margins. As a result, Moda in Pelle’s outlook assumes ongoing efforts to optimize channel mix, protect brand positioning, and balance volume growth against profitability considerations.

Future store openings are expected to be selective and capital-disciplined, with performance closely monitored against return thresholds. Management expects channel diversification to remain a key element of its commercial strategy over the next twelve months, with a focus on balancing revenue growth, margin discipline, and working capital efficiency across physical retail, digital, and third-party channels.

Management anticipates limited physical expansion, including the planned addition of one outlet and two full-price stores. In addition, three new concession locations are expected to come online, reflecting management’s view of concessions as a comparatively capital-efficient growth format.

Moda in Pelle’s digital channel is expected to remain the largest single contributor to revenue. Management believes digital channels offer scalability and improved data visibility, although performance remains subject to promotional intensity and fulfillment costs.

Management also expects additional incremental revenue from expanded third-party relationships, which are expected to provide additional reach and volume but typically at lower margins.

Overall, management believes the anticipated channel mix reflects a measured approach to growth, with increased emphasis on digital and concession-based expansion and controlled additions to physical retail.

Profitability, Liquidity, and Capital Outlook

While management expects revenue to increase in the future, profitability, if any, will depend on Moda in Pelle’s ability to contain operating cost inflation, improve working capital efficiency, and realize scale benefits from technology deployment.

Execution of Moda in Pelle’s strategy is also dependent on access to sufficient capital to normalize working capital cycles, address deferred tax and supplier obligations, and fund expansion initiatives. Management’s outlook assumes that balance sheet strengthening and improved liquidity will remain priorities as Moda in Pelle progresses through its growth phase.

Competition

The footwear market is highly competitive and fragmented, and Moda in Pelle competes with a broad range of domestic and international companies across multiple distribution channels. Competition is typically based on a number of factors, including brand recognition, product quality and design, pricing, promotional activity, customer experience, store location, digital capabilities, delivery and returns policies, and the ability to respond to changing consumer preferences and fashion trends.

Moda in Pelle competes with specialty footwear retailers that operate both physical retail stores and e-commerce platforms in the United Kingdom and internationally. These competitors include companies such as Clarks, Office, Schuh and Deichmann, as well as other regional and national footwear chains with established retail footprints and online operations.

Moda in Pelle also faces competition from direct-to-consumer and brand-owned footwear companies, including companies such as Dr. Martens, Birkenstock and Allbirds, which sell products directly to consumers through proprietary websites and, in some cases, branded retail stores. These competitors may benefit from strong brand recognition, vertically integrated operations, and direct customer relationships.

In addition, Moda in Pelle competes with general apparel and lifestyle retailers, department stores and sporting goods retailers that offer footwear as part of a broader merchandise assortment, including Marks & Spencer, Next, Zara and H&M, as well as with online marketplaces and digital retailers such as Amazon, ASOS, Zalando, and Very, which provide consumers with access to a wide range of footwear brands and price points.

Competition in the online channel is particularly intense due to low barriers to entry, high price transparency, and evolving consumer expectations regarding website functionality, mobile access, fulfillment speed, and customer service. In the brick-and-mortar channel, Moda in Pelle competes for foot traffic and favorable retail locations and must manage fixed operating costs while adapting to shifts in consumer shopping behavior.

Many of Moda in Pelle’s competitors have longer operating histories, greater brand recognition, broader geographic reach, and substantially greater financial, technological, marketing and operational resources than Moda in Pelle. These competitors may be able to respond more quickly to changes in consumer demand, adopt new technologies, secure more favorable terms from suppliers and landlords, or engage in more aggressive pricing or promotional strategies.

As a result of these competitive pressures, Moda in Pelle may experience reduced sales, lower margins, or increased marketing and operating expenses. There can be no assurance that Moda in Pelle will be able to compete successfully against current or future competitors, or that competitive conditions will not materially and adversely affect its business, financial condition and results of operations.

Government Regulations

Moda in Pelle is subject to extensive laws and regulations in the UK and other jurisdictions in which it operates or sells products. These laws and regulations govern, among other things, consumer protection, product safety, advertising and marketing practices, data protection and privacy, labor and employment matters, import and export controls, environmental protection, and ethical sourcing and supply chain transparency.

In the UK, Moda in Pelle is subject to regulation by, among others, the UK Competition and Markets Authority, Trading Standards authorities, the Health and Safety Executive, the Information Commissioner’s Office, and HM Revenue & Customs. Applicable UK laws and regulations include, without limitation, the Consumer Rights Act 2015, the Consumer Protection from Unfair Trading Regulations 2008, the General Product Safety Regulations 2005, the UK General Data Protection Regulation and the Data Protection Act 2018, and various regulations relating to product labeling, pricing, advertising claims, and electronic commerce.

Moda in Pelle’s collection, use, storage and processing of personal data are subject to data protection and privacy laws in the jurisdictions in which it operates, including the UK GDPR (General Data Protection Regulation), the Data Protection Act 2018 and, to the extent Moda in Pelle offers products or services to customers in the European Union, the EU General Data Protection Regulation. These laws impose obligations relating to transparency, lawful processing, data security, data subject rights, and cross-border data transfers, and provide for significant regulatory enforcement powers and potential fines for non-compliance. In the UK, these are further amended by the Data (Use and Access) Act 2025, which introduces flexibilities such as a new “recognized legitimate interests” basis for processing, eased rules on automated decision-making, increased fines under the Privacy and Electronic Communications Regulations up to 4% of annual turnover, and softer requirements for non-essential cookie consent.

As a footwear company sourcing products internationally, Moda in Pelle is subject to trade, customs, and supply chain regulations, including tariff classifications, country-of-origin rules, and sanctions and trade compliance laws. Moda in Pelle is also subject to supply chain transparency and modern slavery laws, including the UK Modern Slavery Act 2015. These laws require disclosure of policies and practices relating to the prevention of forced labor and human trafficking within supply chains. Potential UK reforms may impose additional due diligence requirements and import bans on products linked to forced labor.

Moda in Pelle requires its suppliers and manufacturers to comply with applicable labor, employment and workplace safety laws, including laws prohibiting child labor, forced labor and unsafe working conditions. While Moda in Pelle seeks to monitor compliance through contractual obligations and supplier standards, it does not control its third-party suppliers, and violations of such laws by suppliers could result in reputational harm, regulatory scrutiny, or disruptions to its supply chain.

Moda in Pelle is also subject to environmental laws and regulations in the jurisdictions in which it operates, including laws relating to waste management, packaging, chemical usage, emissions, sustainability disclosures, and the disposal or recycling of consumer products. Increasing regulatory focus on environmental, social and governance matters, including sustainability and climate-related disclosures, may impose additional compliance obligations and costs on Moda in Pelle. In the EU (including in Northern Ireland), the Ecodesign for Sustainable Products Regulation prohibits the destruction of unsold apparel and footwear by large enterprises starting July 19, 2026, and requires a Digital Product Passport for traceability and environmental impact data by July 2026. Extended Producer Responsibility schemes for textiles and footwear, expected to be implemented by mid-2028 in EU Member States, will hold producers accountable for collection, reuse, and recycling, with eco-modulated fees. The EU Deforestation Regulation applies to leather, rubber, and wood in footwear, requiring due diligence to ensure materials are not from deforested land, with potential fines up to 4% of EU annual turnover. Additional restrictions on per- and polyfluoroalkyl substances (PFAS) in textiles and footwear, may require product reformulation. In the UK, the Competition and Markets Authority's Green Claims Guidance for fashion, issued in October 2024, requires evidence for environmental claims to avoid greenwashing under the Consumer Protection from Unfair Trading Regulations. A voluntary UK Textiles Pact and potential mandatory Extended Producer Responsibility via government plans in early 2026 could add similar fees and reporting.

In the EU and Northern Ireland, product safety is governed by the EU General Product Safety Regulation, which requires risk assessments, traceability, and an EU-based responsible person for non-EU manufacturers. In Great Britain, the General Product Safety Regulations 2005 continue, but the UK Product Regulation and Metrology Act 2025 grants powers to update rules for safety, environmental impact, and labeling, potentially aligning selectively with EU standards.

Laws and regulations applicable to Moda in Pelle are subject to change and may be interpreted or enforced in ways that are inconsistent across jurisdictions. New or proposed legislation, regulations or enforcement practices in the UK, the EU or other markets could increase Moda in Pelle’s compliance costs, restrict its operations, require changes to its products or business practices, or otherwise materially and adversely affect its business, financial condition and results of operations.