NASDAQ: LASE

We
initiated our sales efforts in December 2019. For the year ended December 31, 2025, we generated sales of $8.3 million, compared to $3.4
million for the year ended December 31, 2024. We are strategically positioned to drive growth and innovation in the laser technology
market by targeting three key customer segments: government entities, Fortune 1000 companies, and medium/small businesses. Each of these
segments presents unique opportunities and challenges, and our business model is designed to cater specifically to the needs and growth
potential within each category.

For
government entities, we provide highly specialized laser solutions that meet stringent regulatory and performance standards. This segment
benefits from our expertise in delivering reliable, durable, and effective laser systems for various applications, from defense and aerospace
to public infrastructure projects. Working with government clients not only solidifies our reputation as a trusted provider of advanced
laser technology but also paves the way for new contracts and collaborative projects. One of our current projects is the Laser Shield
Anti-Drone System (“LSAD”), a joint development with our affiliate, Fonon Drone Shield Solutions, Inc., to create a laser
defense system to serve as an immediate response defense system for addressing the threat of small-scale unmanned aerial systems in conflict
zones and expeditionary locations. We successfully completed a test of the LSAD prototype at our Orlando facility.

Fortune
1000 companies represent another critical segment, where our laser technology can significantly enhance operational efficiency, precision,
and productivity. By addressing the unique challenges of large-scale industrial applications, we position ourselves as an essential partner
in the innovation strategies of these corporations. Our advanced laser solutions help these clients stay competitive and maintain high-quality
standards, driving repeat business and fostering long-term partnerships.

Medium
and small businesses constitute the third pivotal segment of our customer base. Recognizing the distinct needs and constraints of this
market, we launched the Service Partner Network (“SPN”). This initiative is designed to empower medium and small businesses
by providing them access to mobile demonstration units, enabling them to experience the advantages of our laser technology firsthand.
The SPN serves a dual purpose: it facilitates immediate equipment sales and acts as a catalyst for demonstrating the practical benefits
and capabilities of our products.

4

Through
the SPN, we also support entrepreneurs looking to start their own mobile laser cleaning or rental service businesses. Our marketing team
plays a crucial role in this ecosystem by generating and distributing leads to SPN members for a fee, thereby creating a continuous revenue
stream. This collaborative approach not only bolsters the success of our SPN partners but also promotes sustained long-term revenue growth
for us.

By
strategically targeting these three customer segments and leveraging the SPN to enhance our market penetration and product visibility,
we believe we are well-positioned for robust growth. Our comprehensive business model not only enhances customer engagement and satisfaction
across diverse markets but also solidifies our standing as an innovative leader in the laser technology industry.

We
market our products globally through our direct sales force which is located in the United States.

Recent
Developments

ICT Investments, LLC (“ICT” or “ICT
Investments”) currently owns approximately 14% of the outstanding shares of our Common Stock, Fonon Drone Shield Solutions, Inc.,
an affiliate of ICT Investments, currently owns approximately 3% of the outstanding shares of our Common Stock, Fonon Quantum Technologies
owns approximately 9% of the outstanding shares of our Common Stock and Fonon Technologies owns approximately 9% of the outstanding shares
of our Common Stock and collectively are our majority stockholders. Dmitriy Nikitin has significant voting power for all matters that are submitted to a vote of the Company’s
shareholders since he currently owns approximately 34% of the outstanding voting shares of the Company’s common stock through his
ownership of all membership interests of ICT Investments which is the controlling entity of Fonon Drone Shield Solutions, Inc., Fonon
Quantum Technologies and Fonon Technologies, Inc. On May 21, 2024 we entered into a license agreement with Fonon Drone Shield Solutions, Inc. to receive an
exclusive, worldwide, sublicensable license to its laser material processing equipment and technology, including all applications of laser
cutting, marking, engraving, laser welding, brazing, ablation, laser drilling, semiconductor chip marking, semiconductor and flat panel
display laser processing equipment, all other laser material processing equipment documented or existing in a form of know-how and/or
trade secrets in return for 3,000,000 restricted shares of our Common Stock. As of December 31, 2025, ICT Investments, through its control
of Fonon Drone Shield Solutions, Inc., Fonon Quantum Technologies and Fonon Technologies, Inc., in the aggregate will own approximately
38% of our Common Stock and will have significant voting power on all matters submitted to a vote of our stockholders, including the election
of our directors. Through our affiliation with ICT Investments, its portfolio companies and its customers, we have access to more than
1,500 high profile Fortune 5000 customer prospects as well as recognition as a global leader in manufacturing premium laser equipment.
In addition, through the expertise and reputation of our officers, board members and advisors, we have the foundation of our technologically
advanced, disruptive laser systems specifically suited for most material processes with specific cleaning requirements and challenges.

On
October 30, 2024, we entered into an Asset Purchase Agreement with CMS, a laser company located in Orlando, Florida, that designs and
builds turnkey laser material processing systems for marking, cutting, drilling and welding. CMS allows us to expand into the pharmaceutical
market for controlled-release medications that is expanding rapidly, driven by the growing need for more effective and patient-friendly
drug delivery systems. Controlled-release tablets, which gradually release medication over time, require precision manufacturing techniques
to ensure the proper dosage and timing of active ingredient release. Laser technology plays a critical role in creating micro-drilled
apertures in these tablets, ensuring accurate and consistent drug release. We believe that there is a significant opportunity to unlock
CMS’s growth potential by integrating it into our existing sales and marketing infrastructure, enhancing customer engagement and
expanding our market reach to maximize wallet share from current customers and bring new clients on board.

With
global pharmaceutical companies focusing on enhancing drug delivery mechanisms, the demand for laser-based solutions like those provided
by CMS is expected to rise. CMS’ experience in supplying laser systems to pharmaceutical companies, coupled with our sales and
marketing expertise, positions the Company to take full advantage of this growing market segment. We acquired all business assets of
CMS, including its intellectual property as well as hiring CMS’ existing workforce, including engineers and customer support personnel,
that we believe will add significant value to the acquired CMS assets.

5

On
February 10, 2025, we entered into a Lease Termination Agreement with 2701 Maitland Building Associates, LLC, the Landlord of Suite 125
containing approximately 7,981 rentable square feet that we had leased from November 7, 2022 through December 31, 2025, at a base monthly
rent of $14,818.06 (“Suite 125”). In light of our entering into a long-term lease at 250 Technology Park. Lake Mary, Florida
32746 on July 1, 2024, we determined that it did not need Suite 125 for its future growth and, since it could not sublet this space,
we entered into the Lease Termination Agreement to reduce our lease expense. Under the terms of the Lease Termination Agreement, we agreed
to pay a monthly termination fee of $14,912.14 base rent plus operating expenses for five months, saving us approximately $80,000 in
lease payments for 2025.

On
July 7, 2025, we and our subsidiary, Control Micro Systems Florida, LLC, entered into a Business Loan and Security Agreement with Agile
Capital and Agile Lending under which we received a term loan in the principal amount of $2,100,000 with total interest of $924,000 (the
“Loan”) to be repaid through weekly principal and interest payments of $94,500 commencing July 16, 2025, and ending February
18, 2026, subject to payment of a $100,000 administrative agent fee paid to Agile Capital.

On
August 5, 2025, we entered into an Asset Purchase Agreement with Fonon Quantum Technologies, Inc., an affiliate of ICT Investments, to
acquire the assets of Beamer Laser, a company that manufactures IR fiber laser marking systems that provide standard, engineered and
inline 1064nm IR laser marking solutions for a variety of industries used in tracking and traceability to serialization, 2D codes and
decorative marking. We believe that the acquisition of these assets will be of substantial financial benefit in terms of its future sales
given the importance of Beamer Laser’s standard industrial marking solutions and modular design to allow for smooth integration
into manufacturing workflows, its U.S.-based manufacturing capabilities that should help us mitigate supply chain issues and tariffs
to ensure better control over manufacturing quality, lead times and costs and with Beamer Laser’s established customer base, which
includes Fortune 100 companies in aerospace, defense and pharmaceuticals, provide us with new growth opportunities for our other laser
technology products.

On
August 28, 2025, we closed a convertible note financing with Hudson Global Ventures, LLC (“Hudson Global”). In connection
with this financing, we entered into a Securities Purchase Agreement (the “SPA”) with Hudson Global requiring that we (i)
issue 418,000 shares of our Common Stock as commitment shares, (ii) issue a warrant for 157,258 shares of our Common Stock at a conversion
price of $4.34 per share subject to customary adjustments for fundamental corporate actions such as mergers, reverse splits and stock
dividends, that is exercisable for five years or that we must earlier pay the Event of Default Black Scholes Value as that term is defined
in the warrant if our Common Stock is deemed “penny Stock” under SEC Rule 240.3a51-1, and (iii) issue a 12 month secured
convertible promissory note in the principal amount of $455,0000 (the “Hudson Convertible Note”) bearing annual interest
of 12% to be repaid through monthly amortization payments of $45,818 and that is convertible into shares of our Common Stock at a fixed
price of $4.34 per share, subject to customary adjustments for fundamental corporate actions such as mergers, reverse splits and stock
dividends, that can be prepaid within the first 60 days from August 27, 2025, without any penalty and after 60 days from August 27, 2025,
at a payment of 118% of the accrued and unpaid interest and unpaid principal of the Hudson Convertible Note. Under the terms of the SPA,
Hudson Global has piggyback rights for the conversion shares underlying the warrant and the Hudson Convertible Note as well as for the
commitment shares.

On
September 2, 2025, we entered into an agreement to exchange certain outstanding warrants issued in the August 2024 PIPE financing (the
“Exchange Agreement”). These warrants, which had an exercise price of $4.34 per share and included a full ratchet anti-dilution
provision, entitled holders to purchase up to an aggregate of 0.8 million shares of our Common Stock. In exchange for relinquishing these
warrants, the warrant holders received unrestricted shares of our Common Stock equal to 400% of the number of shares of our Common Stock
issuable upon exercise of the warrants that for all warrant holders results in an aggregate of 3.2 million unrestricted shares of our
Common Stock. We also have agreed, subject to customary exceptions, for a period of 30 days starting on September 3, 2025, not to issue
any shares of our Common Stock nor to file any registration statant or any amendment or supplement to any existing registration statement.
We also issued to the placement agent facilitating the Exchange Agreement or its designees warrants to purchase an aggregate of 56,000
shares of our restricted Common Stock that are exercisable for five years at $5.0250 per share subject to customary adjustments, including
for stock splits, stock dividends, rights offerings and fundamental transactions such as a merger resulting in a change of control.

6

On
September 12, 2025, we issued to four investors certain unsecured promissory notes (the “Notes”) under the terms of a Note
Purchase Agreement (the “NPA”). The Notes are (i) in the total principal amount of $2,111,111.12 with an Original Issuance
Discount (“OID”) equal to 10% that resulted in the Company receiving net proceeds of $1,129,400 following deductions for
expenses, including an 8% placement agency fee and 1% non-accountable allowance paid to RBW Capital Partners LLC (“RBW”),
a division of Dawson James Securities, Inc., under the terms of a Placement Agency Agreement dated September 5, 2025, between the Company
and RBW, and repayment of principal and accrued and unpaid interest of $509,600 owed to Hudson Global Ventures, LLC (“Hudson Global”)
under a convertible note in the principal amount of $455,000 issued under the term of a Securities Purchase Agreement dated August 27,
2025, (ii) due the earlier of three (3) months from the dates of the Notes which are all September 12, 2025, or in the event of a prior
subsequent financing by the Company, the Notes at the option of the holder must be repaid in full or, if applicable, are exchangeable
into the consideration in the subsequent offering, (iii) subject to a payment in the event of a default of 120% of the unpaid principal
amount, accrued interest and all other amounts owing under the Notes, which amount increases by 5% every 30 days following the date of
the event of default until the Notes are paid in full (the “Mandatory Default Amount”) and (iv) limited to prepayment only
upon a change of control of the Company subject to payment of the Mandatory Default Amount. The principal amount of the Notes remains
outstanding and the use of proceeds of this offering will be used to repay the Notes in full in addition to payment of the Mandatory
Default Amount. The Company has been in settlement discussions with the four holders of the Notes regarding claims that until the Notes
were repaid the Company could not sell securities greater than $50,000 and agreeing to enter into a PIPE transaction by October 17, 2025,
to be led by RBW Capital. The Company and its note holders have agreed to resolve this dispute through repayment of the note holders
in an amount of approximately $3.2 million from the proceeds of the current S-1 offering with HCW.

On
September 22, 2025, we entered into a securities purchase agreement (the “Purchase Agreement”) with certain accredited investors
(the “Investors”), pursuant to which we agreed to issue and sell to the Investors in a private placement (i) 1,098,902 shares
of Common Stock at a price of $3.64 per Share, (ii) Series A warrants to purchase up to 1,098,902 shares of Common Stock and (iii) Series
B warrants to purchase up to 1,098,902 shares of Common Stock for total aggregate gross proceeds of approximately $4 million. The offering
closed on September 30, 2025. The Series A Warrants have an exercise price of $3.40 per share, are exercisable upon issuance (the “Initial
Exercise Date”), and expire five years following the effective date of the resale registration statement on Form S-1 that we filed
under the terms of a registration rights agreement in connection with the Purchase Agreement. The Series B Warrants have an exercise
price of $3.40 per share, are exercisable commencing on the Initial Exercise Date and expire eighteen months following the effective
date of the resale registration statement. H.C. Wainwright & Co., LLC acted as the exclusive placement agent for the issuance and
sale of these securities. The Company agreed to pay up to an aggregate cash fee equal to 7.0% of the gross proceeds received by the Company
from this offering and issued to Wainwright warrants to purchase up to 76,923 shares of Common Stock at an exercise price per share of
$4.55, which are exercisable commencing upon issuance and a have term of five years after effective date of resale registration statement.

On
February 9, 2026, we conducted a public offering of an aggregate of (i) 7,142,858 shares (the “Shares”) of the Company’s
common stock, par value $0.001 per share (the “Common Stock”), at an offering price per Share and associated Warrants of
$0.70, (ii) five year Series A-1 Common Stock purchase warrants (the “Series A-1 Warrants”) to purchase up to 7,142,858 shares
of Common Stock at an exercise price of $0.70 per share, and (iii) twenty-four month Series A-2 Common Stock purchase warrants (the “Series
A-2 Warrants”, and, collectively with the Series A-1 Warrants, the “Warrants”) to purchase up to 7,142,858 shares of
Common Stock at an exercise price of $0.70 per share, for aggregate gross proceeds of $5,000,000.60. In connection with the closing,
the Company will issue to H.C. Wainwright & Co., LLC (“Wainwright”) or its designees warrants to purchase up to an aggregate
of 500,000 shares of Common Stock at an exercise price of $0.875 per share, which are exercisable immediately upon issuance and have
a termination date of February 6, 2031. Additionally, in connection with a note financing conducted by the Company in September 2025,
the Company will pay Wainwright a cash fee equal to $147,777.78 and issue to Wainwright or its designees unregistered warrants to purchase
up to an aggregate of 57,058 shares of Common Stock at an exercise price of $3.2375 per share, which are exercisable immediately upon
issuance and have a termination date of February 6, 2031. The net proceeds received by the Company after commissions, fees, legal expenses,
and payment of the cash fee to Wainwright, was $4,121,273.

Growth
Strategy

Our
objective is to achieve a leadership position in our industry with a focus in growth technologies including laser welding, laser cutting,
laser cleaning, semiconductor, 3-D printing, and anti-drone defense. The key elements of our growth strategy are:

Multi-Market
and Multi-Product Approach. We intend to develop and manufacture laser systems for a variety of markets to reduce the financial impact
that a downturn in any one market would have.

Accent
on Developing Standard Systems for Specific Markets. We expect to increase sales through an industry-recognized expertise in clearly
defined markets with substantial sales demand such as rust removal equipment for the shipbuilding industry, laser de-contamination equipment
for the nuclear industry and laser blasting cabinets for the general manufacturing industry.

7

Broaden
Customer Relationships. We expect to develop a global diversified customer base in a variety of industries. We seek to differentiate
ourselves from our competitors through superior product pricing, performance and service. We believe that a global presence and investments
in application engineering and support will create competitive advantages in serving multinational and local companies.

New
Product Development. We intend to target new applications early in the development cycle and drive adoption by leveraging our strong
customer relationships, engineering expertise and competitive production costs.

We
intend to continue to stay ahead of the technology curve by researching and developing cutting edge products and technologies for both
large and small businesses. In addition to our attention to Fortune 1000 companies, we also view the small companies as an attractive
market opportunity since they were previously unable to take advantage of laser processing equipment due to high prices, significant
operating costs and the technical complexities of the laser equipment. As a result, we are developing a group of standardized laser cleaning
equipment that we have named the CleanTech™ laser blaster family of equipment that we believe represents a new generation of high
power laser cleaning and rust removal systems that will be affordable to more than a million small and mid-size companies.

Facilities

Our
principal executive offices are located at 250 Technology Park, Lake Mary, Florida, 32746, to support our administrative, engineering
and operational activities. This office serves as our headquarters and is intended to allow for future growth. See “Item 2. Properties”
below.

Implications
of Being an Emerging Growth Company

As
a company with less than $1.235 billion in revenue during our most recently completed fiscal year, we qualify as an “emerging growth
company” as defined in Section 2(a) of the Securities Act of 1933, as amended, which we refer to as the Securities Act, as modified
by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we may take advantage of specified
reduced disclosure and other requirements that are otherwise applicable, in general, to public companies that are not emerging growth
companies. These provisions include:

●
Reduced
disclosure about our executive compensation arrangements;

●
No
non-binding stockholder advisory votes on executive compensation or golden parachute arrangements;

●
Exemption
from the auditor attestation requirement in the assessment of our internal control over financial reporting; and

●
Reduced
disclosure of financial information in this prospectus, limited to two years of audited financial information and two years of selected
financial information.

As
a smaller reporting company, each of the foregoing exemptions is currently available to us. We may take advantage of these exemptions
for up to five years following our initial public offering on September 29, 2022, or such earlier time that we are no longer an emerging
growth company. We would cease to be an emerging growth company if we have more than $1.235 billion in annual revenues as of the end
of a fiscal year, if we are deemed to be a large-accelerated filer under the rules of the Securities and Exchange Commission, or if we
issue more than $1.0 billion of non-convertible debt over a three-year-period.

Notwithstanding
the above, we are also currently a “smaller reporting company”, meaning that we are not an investment company, an asset-backed
issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and have a public float of less than
$75 million and annual revenues of less than $50 million during the most recently completed fiscal year. In the event that we are still
considered a “smaller reporting company”, at such time as we cease being an “emerging growth company”, the disclosure
we will be required to provide in our SEC filings will increase but will still be less than it would be if we were not considered either
an “emerging growth company” or a “smaller reporting company”. Specifically, similar to “emerging growth
companies”, “smaller reporting companies” are able to provide simplified executive compensation disclosures in their
filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) requiring
that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial
reporting; and have certain other decreased disclosure obligations in their SEC filings, including, among other things, only being required
to provide two years of audited financial statements in annual reports.

8

Our
Laser Cleaning Products

The
current administration’s focus on fiscal responsibility and budget constraints has led to reduced spending on new equipment, increasing
the need for maintenance, repair, and overhaul (MRO) of existing assets. As a result, demand for cost-effective, high-performance solutions
is rising across defense and industrial sectors.

Laser
Photonics is strategically positioned to meet this need with our TAA-compliant line of laser solutions offered under the DefenceTech
brand. Our “Made in America” industrial laser systems align with federal procurement priorities, ensuring U.S. agencies have
access to cutting-edge, domestically manufactured technology for MRO applications. As one of few industrial laser cleaning equipment
manufacturer meeting “Buy American” requirements, we are well-positioned to receive preferential consideration over foreign
competitors in the laser cleaning systems market.

Diversified
and Proprietary Technology Platform and Knowhow

We
were able to secure through our affiliation with ICT Investments a diverse portfolio of know-how, trade secrets and proprietary technologies.
We believe that we possess design documentation for the largest array of laser-based systems for material processing in North America.

Core
Technologies Underlying Each Product

Fiber
laser cleaning technology or laser ablation which we market under the Laser Blasting™ brand, is a proven, state-of-the-art, 21st
Century replacement for hazardous 19th century abrasives blasting (or sandblasting). It is a non-contact, environmentally friendly process
that removes surface coatings from metals, concrete and delicate substrates such as composites—with minimal impact on the base
material. Laser Blasting works by aiming brief pulses of high-power laser energy (in the µs–ms range) at a surface to be
prepared or cleaned of paint, rust, or other contaminants. The energy applied to the layer being removed doesn’t dissipate. Instead,
it blasts off the substrate material being cleaned. Most or all of the material being removed is vaporized, resulting in a much cleaner
process than other cleaning methods. Whatever removed material has not been vaporized may be suctioned away and filtered out of the air
as particle dust.

We
are recognized as a pioneer and an industry leader with our CleanTech™ Laser Blasting™ technology. Laser Blasting can replace
sandblasting or dry ice blasting in nearly every industry and every application where an abrasive blasting is used. It is effective on
glass, ceramics, metals, concrete, plastics and much more, and provides greater control and precision than possible with the legacy technologies
it is designed to replace. LP portable Laser Blasting systems incorporate proprietary autofocusing C-Optics technology that allows for
greater precision on uneven or contoured surfaces, even from handheld Laser Blasting systems. This innovation expands laser cleaning
from the production floor to the field. Laser Blasting is effective on small parts and sensitive materials, as well as surfaces of ships,
bridges, aircraft, pipelines, large vehicles, and trains, among others.

9

Our
Product Platforms

Since
our founding in 2019, and through IP received from ICT Investments, we have developed an extensive portfolio of products based on proprietary
technologies that form the foundation of our laser blasting equipment manufacturing solutions, which are comprised of hardware, equipment
design documentation, bills of materials, software, materials, and service practices.

Designed
in-house by industry-recognized laser scientists and inventors, our expansive product portfolio covers a broad spectrum of applications
across key industries, including maritime and shipbuilding, oil and gas, automotive manufacturing, rail transport, aerospace, defense,
and space exploration. Our CleanTech™ line scales with customer needs, starting with low price-point handheld Laser Blasters™
designed to tackle simple cleaning and surface predation jobs, to high-end AI-controlled, user-programmable C-Robotics™ made for
complex, precision production environments.

Our
state-of-the-art, performance-based “Made in America” Laser Blasting™ products are industrial-grade laser cleaning
systems developed to disrupt and displace hazardous legacy abrasives blasting (a.k.a. sandblasting) and chemical cleaning methods that
have been in common usage since the 19th century. Laser Blasting is cleaner to operate, more cost effective to own and safer for the
worker and the environment. We believe that Laser Blasting is right on time as industry is increasingly coming under pressure to phase
out abrasive blasting and chemical cleaning methods in compliance with health, environmental and safety regulations designed to protect
laborers and the environment.

Since
our founding in 2019, we have developed an extensive portfolio of proprietary equipment and technologies that formed the base for our
broad product offering, starting from relatively simple handheld devices to fully automatic and operated by AI robotic systems.

Our
diverse lines of laser cleaning equipment are used in a variety of industries to improve and promote programs to address significant
concerns about the exposure of employees to toxic airborne materials to reduce the risk of lung cancer and silicosis triggered by inhalation
of crystalline silica dust released from abrasive blasting. Laser cleaning uses photons emissions, thus eliminating the need for abrasive
media, including silica. The chart below provides information on several industries to indicate the need for laser cleaning equipment
and how our technology meets those industries’ requirements. This chart was developed by us in the last few months to allow our
salespeople to identify the specific model of our CleanTech laser blasting equipment that matches target industries and the surface integrity
parameters familiar to prospective customers. We want to demonstrate our capability to address the specific cleaning applications that
such customers require. The industry terminology is explained in our footnotes to the chart.

Below
is the description of abbreviations and definitions used in Laser Photonics Laser Blaster products qualification chart:

●
Roughing-Rough
surface condition for thick material

●
Mid-Range-Normal
level below roughest surface condition for medium material thickness

●
Finishing-Least
amount of roughness on a surface for thin materials

●
Gauge-indication
of a measurement of industrial materials.

●
Grit-indication
of roughness to apply to a surface for preparation prior to coating.

●
CAML-grade
of abrasive media used for the sandblasting industry.

●
DPI-Dots
per inch

●
LPI-Lines
per inch

●
Laser
Grade-Designated choice of laser for best results

●
Strip
Rate in Ft Squared per hour is calculated as follows: 2X (laser power in KW) / (coating thickness in mils, where one mill= .001),
X 60 minutes. Source: Robotic Laser Coating Removal System ESTCP Project WP- 0526 apps.dtic.mil

10

Our
current Laser Blasting solutions are as follows:

Handheld
CleanTech Line: We offer the widest range of Class IV handheld laser blasting equipment in the world, spanning from 50W to 3000W,
and including the world’s most powerful production laser blaster on the market — the CleanTech Industrial Roughening Laser
3060, delivering average power levels in the 10,000-watt range.

We’re
currently developing an even more powerful solution designed for seamless integration into our CleanTech Robotic Cell, complete with
safety interlocks to ensure full OSHA and FDA CDRH Class 1 compliance.

The
CleanTech 3060 is a high-performance cleaning and surface preparation system, engineered to efficiently remove rust, paint, and other
surface contaminants from materials such as steel, aluminum, iron, and a wide range of other substrates.

Our
handheld CleanTech line features five distinct pulse laser patterns, including a proprietary cleaning mode specifically designed to maximize
efficiency and minimize thermal stress, offering unmatched flexibility for a variety of industrial applications across diverse surface
types.

CleanTech™
Laser Blaster Cabinet The CleanTech™ Laser Blaster Cabinet is a fully enclosed, Class 1 laser workspace, engineered as a safer,
cleaner, and more efficient alternative to traditional sandblasting enclosures—eliminating the noise, dust, media storage, replenishment,
and cleanup associated with abrasive blasting.

Designed
for companies of all sizes, this self-contained, industrial-grade laser cleaning machine replaces abrasive blasting and chemical baths,
providing a high-precision, environmentally friendly solution for part cleaning and material preparation.

What
sets the CleanTech™ Laser Blaster Cabinet apart is its exclusive fiber laser technology, paired with a handheld laser-blasting
head, all housed within a fully enclosed 30” x 26” workspace. Built for speed, precision, safety, and flexibility, it is
the only laser-blasting cabinet in the world manufactured in full compliance with CDRH, FDA, and OSHA regulations.

With
this system, companies can eliminate hazardous dust, noise, and toxic chemicals, ensuring a safer, cleaner, and more cost-effective work
environment while achieving superior cleaning and surface preparation results.

11

CleanTech™
Class I Laser Blasting Systems

Our
CleanTech™ MegaCenter, Titan, and Titan Express automated Class I-ready laser blasting systems are purpose-built for mass production
environments. Engineered with advanced automation controls and automated material-loading capabilities, these systems deliver maximum
throughput for high-volume, high-precision manufacturing operations.

The
CleanTech™ Titan Series is a high-power, large-format laser system designed for parts cleaning, rust removal, and surface conditioning,
featuring an expansive 6′ x 12′ working area and Flex-Loading options for seamless, continuous operation. This industrial-grade,
turn-key solution can operate as a standalone unit or be fully integrated into an existing production line.

The
full CleanTech lineup includes the Titan, Titan Express, MegaCenter, and the portable CleanTech™ Handheld, ideal for use both in
the field and on the factory floor. All CleanTech systems are built for industrial durability and operate in full compliance with OSHA,
FDA, and CDRH safety standards, supporting true “Push-Button” laser-safe operation for unmatched ease of use and workplace
safety.

CleanTech™
Robotic Cell with AI

The
CleanTech™ Robotic Cell integrates our advanced User-Programmable AI (UPAI), enabling factory line workers to easily program precision
robotic operations—no coding or robotics expertise required. This breakthrough makes it simple to automate complex, repetitive
tasks in high-throughput production environments, boosting both productivity and consistency.

12

The
CleanTech™ Laser Cleaning Robot is the first commercially available, collaborative, and AI-capable laser cleaning system in the
United States. Purpose-built for precise beam positioning and tight focus, it operates at significantly lower laser power levels than
traditional handheld systems—dramatically reducing operational costs and making laser cleaning more accessible and affordable for
a wide range of industrial applications.

Safety
and efficiency are at the core of the system’s design. With optional adds on including AI, a 3D scanner and visualizer, vision
system, and a Class 1 safety enclosure, the robot can perform multiple tasks simultaneously—all while minimizing operator exposure
and ensuring full compliance with OSHA and FDA CDRH regulations.

The
result is a next-generation laser cleaning solution that combines cutting-edge automation, intelligent control, and industry-leading
safety—bringing unprecedented capability to modern manufacturing floors.

Customers

Our
intent is to establish additional relationships with Fortune 1000 customers primarily within the United States and with select Fortune
1000 customers around the globe and represent a broad array of industries, including automotive, aerospace, healthcare, consumer products,
heavy industry, machine design, research, and others.

Research,
Development and Engineering

The
principal focus of our research and development activity is the development of our proprietary laser-based cleaning equipment to replace
global sand blasting and abrasive blasting applications in a large number of markets discussed below.

Marketing
and Sales

For
the year ending in December 31, 2025, we employed 8 direct salespeople, 10 global distributors/resellers, and signed two technology partnerships
for integration of our Cleantech product line into robotic platforms for both commercial and defense applications.

In
calendar years 2023 to 2025, we invested in sales and marketing activities, including investing nearly $4 million in the development
and scaling of sales and marketing operations. We have a marketing and sales budget equal to 10% of our gross sales, and a new product
promotional budget of $0.7 million for 2026.

Product
Warranty and Support

We
offer for sale with our equipment a two-year limited warranty against defects in materials and workmanship under normal use and service
conditions following delivery of our equipment to our customers.

We
also warrant the owners of our custom laser systems that are designed and manufactured in accordance with agreed-upon specifications.
In resolving claims under both the defects and performance warranties, we have the option of either repairing or replacing the covered
laser cleaning equipment. Our warranties are automatically transferred from the original purchaser of our laser cleaning equipment and
optical components to subsequent purchasers upon delivery of our finished laser systems.

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In
general, our products carry a warranty against defects, depending on the product type and customer negotiations. The costs associated
with these warranty obligations are not expected to be significant and no such costs have been recorded in our financial statements.

Competition

The
laser cleaning market is highly fragmented, with most competitors being small, privately held, or operating within limited geographic
regions, specific industries, or niche applications. While our competitive landscape is diverse, it remains intensely competitive, shaped
by rapid technological advancements, increasing customer demands, and downward pressure on average selling prices as newer, integrated
technologies replace outdated systems.

Our
most notable competitors include P-Laser and Clean-Lasersysteme GmbH (represented in the U.S. by Adapt Laser Systems), along with smaller
players such as Laserax and 4JET. Some of these competitors are attempting to close the gap by increasing the output power of their fiber
lasers to compete with our high-powered, industrial-grade solutions.

However,
most competitors do not meet CDRH safety requirements for Class 4 laser systems, making them unlikely to be considered by many companies
that prioritize workplace safety and regulatory compliance. At Laser Photonics, customer safety is our top priority. Our systems are
designed and manufactured to fully comply with OSHA, FDA, and CDRH regulations, ensuring that companies receive not only cutting-edge
performance but also the highest level of operational safety and reliability.

We
also compete with end-users that produce laser technology, as well as with manufacturers of non-laser methods and tools, such as traditional
abrasives blasting (referred to as sandblasting), non-laser welding, cutting dies, mechanical cutters, and plasma cutters in the materials
processing market. Some of our competitors are larger, with considerably more financial, managerial, and technical resources, as well
as more extensive sales, distribution, and service networks, and greater marketing capacity.

Our
primary focus is to provide diversified industrial-grade laser-based cleaning machinery in a variety of markets. Each market has a different
group of competitors subject to rapidly changing technologies and materials, a customer base with continuously changing requirements
and geographical outsourcing challenges.

We
believe that our future success is dependent on our flexibility to adapt to changes in the marketplace, expanding our existing products
and services targeting application specific systems for each industry we serve. We continuously introduce new products and services on
a timely and cost-effective basis identifying both standard and niche laser-systems opportunities enhancing our ability to penetrate
new customers and new emerging markets.

Primary
competitive factors in our markets include:

●
Price
and value

●
Ability
to design, manufacture, and deliver new products on a cost-effective and timely basis.

●
Ability
of our suppliers to produce and deliver components in a timely manner, in the quantity desired and at the budgeted prices

●
Product
performance and reliability

●
Service
support.

●
Product
mix

●
Ability
to meet customer specifications.

●
Ability
to respond quickly to changes in market demand and technology developments.

In
the materials processing market, the competition is fragmented with a large number of competitors that are small or privately owned or
compete with us on a limited geographic, industry, or application specific basis including Trumpf GmbH, Clean Laser GMBH, P-Laser. Advanced
Laser Technology, Anilox Roll Cleaning Systems, General Lasertronics, IPGPhotonics, Laserax, and White Lion Dry Ice & Laser Cleaning
Technology. We believe that none of our competitors compete in all the industries, applications, and geographical markets which we serve
and that our products compete favorably with respect to their laser cleaning equipment.

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Intellectual
Property and License Rights

We
believe that our success depends, in part, on our ability to maintain and protect our proprietary technology and to conduct our business
without infringing on the proprietary rights of others.

We
rely primarily on a combination of trademarks and trade secrets, as well as associate and third-party confidentiality agreements, to
safeguard our intellectual property.

With
respect to proprietary know-how that is not patentable and processes for which patents are difficult to enforce, we rely on, among other
things, trade secret protection and confidentiality agreements to safeguard our interests. We believe that many elements of our laser
system manufacturing process, including our unique materials sourcing, involve proprietary know-how, technology, or data that are not
covered by patents or patent applications, including technical processes, equipment designs, algorithms, and procedures. We have taken
security measures to protect these elements. All our research and development personnel will have to sign confidentiality and proprietary
information agreements with us. These agreements address intellectual property protection issues and require our associates to assign
to us all the inventions, designs, and technologies they develop during the course of employment with us. We also require our customers
and business partners to enter into confidentiality agreements before we disclose any sensitive aspects of our modules, technology, or
business plans.

Employees
and Human Capital

As
of December 31, 2025, we employed 94 full-time team members and had no part-time employees. Our human capital strategy focuses on identifying,
recruiting, retaining, incentivizing, and effectively integrating both existing personnel and new talent, including employees, advisors,
and consultants. These efforts are essential to support our continued growth and innovation across all areas of the business.

Government
Regulation

Our
current and contemplated activities and the products and processes that will result from such activities are subject to substantial government
regulation, both in the United States and internationally.

Government
Contracts and Regulations

Our
U.S. Government business is heavily regulated. We contract with several U.S. Government agencies and entities, principally all branches
of the U.S. military. We must comply with, and are subject to, laws and regulations governing the formation, administration, and performance
of U.S. Government contracts. These laws and regulations, among other things:

●
require
certification and disclosure of all cost or pricing data in connection with certain types of contract negotiations;

●
impose
specific and unique cost accounting practices that may differ from U.S. generally accepted accounting principles (GAAP);

●
impose
acquisition regulations, which may change or be replaced over time, that define which costs can be charged to the U.S. Government,
how and when costs can be charged, and otherwise govern our right to reimbursement under certain U.S. Government contracts;

●
require
specific security controls to protect U.S. Government controlled unclassified information and restrict the use and dissemination
of information classified for national security purposes and the export of certain products, services and technical data; and compliance
with cyber security regulations by our supply chain; and

●
require
the review and approval of contractor business systems, defined in the regulations as: (i) Accounting System; (ii) Estimating System;
(iii) Earned Value Management System, for managing cost and schedule performance on certain complex programs; (iv) Purchasing System;
(v) Material Management and Accounting System, for planning, controlling and accounting for the acquisition, use, issuing and disposition
of material; and (vi) Property Management System.

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The
U.S. Government may terminate any of our government contracts and subcontracts either at its convenience or for default based on our
performance. If a contract is terminated for convenience, we generally are protected by provisions covering reimbursement for costs incurred
on the contract and profit on those costs. If a contract is terminated for default, we generally are entitled to payments for our work
that has been accepted by the U.S. Government or other governments; however, the U.S. Government could make claims to reduce the contract
value or recover its procurement costs and could assess other special penalties. For more information regarding the U.S. Government’s
right to terminate our contracts and government contracting laws and regulations, see “Risk Factors”.

Radiation
Control for Health and Safety Act

We
are subject to the laser radiation safety regulations of the Radiation Control for Health and Safety Act administered by the National
Center for Devices and Radiological Health, a branch of the United States Food and Drug Administration. Among other things, those regulations
require laser manufacturers to file new product and annual reports, to maintain quality control and sales records, to perform product
testing, to distribute appropriate operating manuals, to incorporate design and operating features in lasers sold to end-users and to
certify and label each laser sold to end-users as one of four classes (based on the level of radiation from the laser that is accessible
to users). Various warning labels must be affixed, and certain protective devices installed depending on the class of product. The National
Center for Devices and Radiological Health is empowered to seek fines and other remedies for violations of regulatory requirements.

CE
Marking

We
are subject to certain regulations in Europe as administered by the European Commission. CE Marking is required for products marketed
within the European Economic Area (EEA) and confirms that the manufacturer meets certain safety, health and environmental protection
requirements administered by the European Union. Non-compliance with these regulations could result in warnings, penalties, or fines.
We believe that we are currently in compliance with these regulations.

United
States Food and Drug Administration

Certain
products manufactured by us are integrated into systems by our customers that are subject to certain regulations administered by the
United States Food and Drug Administration. We must comply with certain quality control measurements for our products to be effectively
used in our customers’ end products. Non-compliance with quality control measurements could result in loss of business with our
customers, fines and penalties.