NASDAQ: OPTX

Syntec
Optics is vertically integrated from design and component manufacturing for lens system assembly to imaging module integration for opto-electronic
system solutions. Making our own housings, mold tools, molding parts, and nanomachining allows close interaction and recut ability, enabling
special techniques to hold tolerances to sub-micron level. Syntec has assembled a world class design-for-manufacturability team, to augment
its production team with deep expertise to fully leverage our vertical integration from component making to optics and electronics assembly.
Syntec Optics has steadily developed variety of other complementary manufacturing techniques to provide a wide suite of horizontal capabilities
including thin films deposition coatings, glass molding, polymer molding, tool-making, mechanicals manufacturing, and nanomachining.

Syntec
became a leader in the industry by pioneering polymer-based optics and then subsequently adding glass optics and optics made from
other materials including crystals and metals. Polymer-based optics provide numerous advantages compared to incumbent glass-based
optics. Polymer-based optics are smaller, lower weight, lower cost, and offer very high-performance optical solutions. For all these
reasons, Syntec is able to deliver products to our clients that are lighter, smaller, and suitable for cutting-edge technology
products including the newly evolving silicon photonics industry. For defense applications, lighter weight optics are a critical
advantage. For example, less weight on helmet equipment can reduce neck trauma for Army soldiers, and less
equipment weight is beneficial for Air Force pilots. For biomedical applications, biocompatible polymer-based optics are considered
safer. For satellite communications, the use of lighter weight metal and polymer optics reduces installation costs.

Our
designs and assembly processes are developed in-house in the United States. In 2016, Syntec Optics expanded its manufacturing facility
to nearly 90,000 square-feet, allowing us to increase our production capacity and offer additional advanced manufacturing processes under
one roof, which provide us the ability to increase sales to existing customers and increase penetration of our end-markets. Our facility
provides a streamlined, partially autonomous production process for our current customers, which comprises optical assembly, electro-optics
assembly, polymer optics molding, glass optics molding, opto-mechanical assembly, nanomachining and thin films coating. Our facility
also provides availability to expand the number of advanced manufacturing processes to handle increased volumes of existing and new customer
orders.

Syntec
had focused on three key end-markets of defense, biomedical, and consumer, all with several mission-critical applications with strong
tailwinds, then also added communications in 2023. We believe these end-markets to be acyclical based upon the Company having positive
aggregate cash flow for the past decade in spite of economic downturns. We believe the consistency of revenues over the past decade from
operations, independent of the trends of the general economy, and the mission-critical nature of our product offerings, is our basis
that these markets are acyclical. We believe our platform is well positioned as the foundation for further organic and inorganic growth
with quality earnings and high margin offerings.

According to the SPIE
Optics and Photonics most recent Industry Report (2024), optics is currently enabling 15% of the global economy, from smart phone cameras
and extended reality devices to low orbit satellite telescopes to keeping our soldiers safe with night vision devices and patients healthy
with intelligent light. This 15% figure represents the estimated value of the global optics and photonics products relative to annual
global gross domestic product. As the world transitions to further adopt optically and photonically enabled products, we will continue
our mission of developing innovative technology to serve these markets with affordable high-performance products globally. We intend
to continue to focus on our core competencies of providing innovative technology, expanding our brand portfolio and providing affordable,
sustainable and accessible optics and photonics enablers, all while being designed and manufactured in the United States.

Industry
Background

For decades, optics
and photonics have been enabling end-market products worldwide. Today, Syntec Optics light-enables products with a wide variety of materials
from aluminum, crystals, glass, and polymers. Syntec’s ground-breaking work in polymer-based optics starting in 2000 created numerous
advantages over the incumbent glass-based optics used in today’s markets:

●
Cost
– Possible 50-150x savings over glass

●
Lightweight
– Ideal for head mounted applications

●
Design
flexibility – Greater optical surface options

1

●
Bio-compatible
– Medical field benefits

●
Ease
of assembly – Ability to design in alignment features

●
Design
in features – Eliminate mounting hardware

●
Performs
better than glass – Functional parameters such as clarity, focus, contrast, brightness

●

Superior
scratch resistance – Reduce damage probability

●
Upgradability
– Reduced replacement/retrofit field cost

●
Repeatability
– Same quality & performance every time

Tailwinds
have propelled Syntec’s innovative hybrid optics where outside durable glass elements are unchanged but inside elements of optical
assemblies are changed to polymers providing lighter weight advantage. Soldiers want lower weight on helmets that are now overloaded
with devices.

Glass
is still an important medium, and Syntec Optics added glass optics in 2018, leveraging its expertise in molding technology. Certain
glasses can be molded for visible and near IR spectrum. Glass molding has also emerged as a leading technology to address growing
needs in mid wave infrared and long wave infrared, especially with growing limitations on availability of Germanium.

Syntec
Optics has offered aluminum or other metal precision-machined and nano-machined opto-mechanicals since 2000. Optical components often
require thin-films coating. Syntec Optics developed unique coating technologies by 2014 to forward integrate.

In
the year 2000, Syntec Optics developed capabilities to assemble its components into sub-systems, integrating optics as well as adding
electronics to the optics.

Addressable
Markets

Optics
and Photonics Industry Report 2024 estimated that in 2023, the manufacturing sector contributed approximately 27% of global gross
domestic product (“GDP”) annually, or an estimated $28.3 trillion, and optics and photonics comprise a substantial
amount of this market. The optics and photonics market, the value of light-enabled products and services, is estimated to be $16
trillion annually, and represents roughly 15% of the world’s economy. This 15% figure represents the estimated value of the
global optics and photonics products relative to annual global gross domestic product. Within this end-market, it is estimated that
global annual revenue for photonics-enabled products and services had exceeded $2.3 trillion in 2023. Photonics touches most sectors
of our economy including consumer electronics (barcode scanners, DVD players, TV remote controls), telecommunications (fiber optics,
lasers, switches), health (eye surgery, biomedical instruments, and imaging), industrial (laser cutting and machining), Defense and
Security (night vision, infrared cameras, remote sensing, aiming) and entertainment (holography and cinema projection). We believe
accelerating optics and photonics innovation will continue to drive economic growth and increase its share of the global
GDP.

The
potential use of photonics in varied industries is fueling growth of the optics and photonics market. We believe sectors including telecom,
transportation, healthcare, energy, aerospace, security, defense & space exploration, consumer, retail, electronics, food & agriculture,
artificial intelligence software, and robotics are in the early stages of a dramatic transformation of scope and scale due to the unprecedented
developments in advanced manufacturing of optics and photonics products, sub-systems, components, and materials. Continued mobility,
intelligence, automation, sensing, and safety needs will accelerate in years to come, which will create a large market opportunity for
such enabling businesses at the forefront of optics and photonics. The global optics and photonics sectors have experienced demand increasing
use of photonics in various applications.

The
Optics & Photonics 2024 Industry Report estimated revenue growth for six of the top areas based on CAGR from 2012 to 2023.
These areas are listed below, as examples of verticals that we intend to focus on:

●
Optical
Communications (+11%), Widespread global adoption of cloud-based services is
driving an expansion of telecom infrastructure in developing economies resulting in significant growth of the optical communications
and networking markets.

●
Sensing,
monitoring, and control (+10%), autonomous systems and the internet-of-things
continued to create demand for a wide variety of photonic sensors. Self-driving cars, drones, and other robotics systems utilize
a wide range of photonic sensors and imaging systems, some of which are increasingly benefiting from embedded artificial intelligence.
Developments in the emerging field of quantum technology should drive major advances in metrology, sensing, communications, and computing,
creating what we believe will be a multitude of new opportunities in photonics.

2

●
Advanced
manufacturing (+7%), gains in this segment were led by lasers for materials
processing while robotics and vision technologies maintained their momentum as did implementation of 3D printing/additive manufacturing.
Photonics-based production tools including lasers, optical metrology, and machine vision combined with adoption of rapid prototyping
and Industry 4.0 are driving big manufacturing changes in industries like aerospace and automobiles.

●
Semiconductor
processing (+7%), driven by demand for optical processing and metrology equipment.
Opto-electronics and mobility, integrated photonics circuits are beginning to address applications that were typically addressed
by integrated electronic circuits. POC Biosensing, terabit internet, lidar based radar, and telecom are areas that are being disrupted
due to reduced cost, size, weight, and power consumption while still improving performance and reliability. Design, develop, and
manufacturing processes are similar to micro-electronics. Integrated photonics is envisioned to play the role in industry 4.0 what
electronic integrated circuits did in industry 3.0.

●
BioMedical
(+9%), growth in diagnostic imaging, digital pathology, in vitro diagnostics,
and point-of-care diagnostics led broad-based gains across this segment. Food safety testing also saw a significant uptick. Looking
ahead, cost-effective photonics-based diagnostic and therapeutic biomedical devices are achieving higher market penetration.

●
Defense,
safety, and security (+6%), driven by gains in more than 30 sub-segments combined
with substantial upswings in video surveillance, perimeter security and sensing, and investment in equipment for directed energy
systems. Infrared systems, hyperspectral imaging, and laser-based countermeasures are all deployed, while laser weapons are emerging
as a real near-term possibility. We believe there may be increased demand for aiming, scoping, and targeting using optics and photonics.

Revolutionary Advanced Manufacturing Tailwinds

This fourth industrial revolution
(“Industry 4.0”), which encompasses the internet-of-things and smart manufacturing, marries physical production and operations
with digital technology, machine learning / artificial intelligence and big data to create a more holistic and connected ecosystem for
companies that focus on manufacturing and supply chain management. As Industry 4.0 continues to bring changes in manufacturing, technological
advancements leading to innovative photonics-enabled products, and photonics are improving manufacturing performance with photonics-enabled
technology. We expect Industry 4.0 to transform production by driving faster, more flexible and more efficient processes which will be
monetized by companies through the production of higher-quality goods at reduced costs.

Beyond the traditional industrial
automation, new transforming products from unmanned aircraft and driverless cars, smart robots in the operating rooms and artificial intelligence
of organ and tissue imaging, to augmented and virtual reality, increasingly require optics and photonics imagers, sensors, and detectors.
We expect this trend to be especially pronounced in the United States, which has seen automation as a way to be globally competitive in
spite of rising wages.

Optics and photonics
are an integral aspect of the ongoing advancement of traditional manufacturing and industrial practices. Optics and photonics can reduce
cost, size, weight, and power consumption in all spheres of technology that is making us smarter. These include our content, its context,
inter-connection for exchange, and various types of content – from imaging to detection and sensing.

Syntec
Platform Overview

Our
unifying platform is a key differentiator. We believe the unifying platform is an aggregation of horizontal and vertical optics and photonics
capabilities that span through the value-chain across materials, spectrum and advanced manufacturing processes. This unifying platform
works by providing customers with several manufacturing capabilities in one location that saves time and reduces logistical burdens and
costs. In 1999 Syntec brought precision machining capabilities into the company with the addition of Wordingham Technologies, enabling
broader capabilities for integrated optical assemblies. The acquisition of Rochester Tool and Mold provided control over making very
precise tools for molded polymer components and molded glass components in hybrid systems. Close collaboration of these acquired entities
began in 2000 and then all three acquired companies moved into one building in the city of Rochester by 2016. Investments from the cash
flow and the unification was achieved to offer customers vertical and horizontal integrated critical capabilities under one-roof for
mission critical sub-system solutions with well demonstrated metrology in both clean room optics and electro-optics assemblies. Thin
film coating laboratory and glass molding technique was developed from grounds up organically to further support the optical element
performances. Altogether, such a vertically and horizontal integrated company offers a further unification platform for consolidation
through further acquisition in a fragmented industry of advanced manufacturers for mission critical application of optics and photonics
even beyond biomedical, defense, and consumer end-markets.

Syntec
Optics has built its brand over two decades and is known as a leader to OEMs in optics and photonics sub-systems production. The dome was made from glass-filled polymer
that replaced Sapphire for domes that had to not only meet high optical performance expected from windows, but be light weight, less
expensive and rapidly scale. Ever since, we have ramped up rapidly many devices ranging from blood analyzers for patients in hospitals
to night vison goggles to keep soldiers safe. The brand has been very visible at the pivotal show for optics and photonics solution providers
annually in San Francisco’s Photonics West trade show.

3

We
currently offer a number of vertically integrated advanced manufacturing processes that deliver to our customers optically enabled products
serving mission critical applications.

Syntec’s
vertical integration strategy delivers many advantages, including greater economies of scale, lower variable production costs, decreased
logistics costs and quality concerns. Advantages of vertical integration specific at Syntec include:

Positive
differentiation is created.

●
Vertical
integration creates predictability because more information is available to our team internally. There is more access to supply chain
and production inputs. By being in more control, from start to finish, Syntec can function with stability and adapt quickly to changes
so that the most effective and profitable results can be achieved.

Asset
investments can focus on specialization.

●
Instead
of seeking vendors and contractors with specific skill sets, vertical integration allows us to invest into internal assets that can
specialize in the skill set that is required. This allows us to differentiate ourselves from others within its industry, creating
a specific brand message and value proposition that resonates consistently with our customer base.

Transaction
costs are lower throughout the supply chain.

●
With
a high level of vertical integration, we can reduce the transaction costs that occur throughout our supply chain. This is done by
removing cascaded margins imposed when dealing with suppliers and vendors that are not part of our integrated process.

Quality
assurance can be built into the system.

●
Vertical
integration allows us to put more eyes on the quality of what is being produced. From the initial supply to the final sale, a better
Q/A process within our system creates a value proposition that is more reliable. In return, greater customer satisfaction occurs,
which builds brand loyalty and return revenues.

4

It
opens new markets.

●
Vertical
Integration can open new markets to the business. By partnering with or purchasing other vendors, proprietary information, property,
or technologies can create local access that may have been otherwise unavailable. When this occurs, more profits can be achieved
with a broader base of business to pursue.

Our
Competitive Strengths

We
believe that we possess the largest share in the markets we operate in, due to our following business strengths, which distinguish us
in this competitive landscape and position us to capitalize on the anticipated continued growth in the optics and photonics enabled market:

○
Premier
Polymer-Based Optics Technology. Each of our innovative optics features custom designed components to enhance optical clarity
and performance in its particular application or setting. Syntec has assembled a world class optical and opto-mechanical design team
capable of executing on the most challenging design projects.

○
Extensive,
Growing Patent Portfolio. We have developed and filed patent applications on commercially relevant aspects of our business
including optical systems and production processes. We own three active issued patents, with an additional one patent
applications pending on manufacturing techniques in the United States.

○
Proven
Go-To-Market Strategy. We have successfully established a direct-to-business platform and have developed strong working relationships
with Tier 1 manufacturers and major OEMs, custom designing products for new and existing applications.

○
Established
Customer Base with Brand Recognition. We have a growing customer base featuring OEMs, distributors, Tier 1 suppliers across
diverse end-markets and mission critical applications in Defense, Consumer and BioMed. The quality of our products has helped drive
adoption from additional end-markets in low earth satellite communication with visibility for future growth through further expansion
of our existing relationships.

○
High
Quality Manufacturing Process. Unlike competitors that outsource their manufacturing processes, our optics are designed,
assembled and tested in the United States, ensuring that our manufacturing process is thoroughly tested, and our optics are of the
highest quality.

○
Drop-In
Replacement. Our optics modules are largely designed to be “drop-in replacements” for traditional glass-based
optics, which means that they are designed to fit into existing frames with little or no adjustments. Our target applications are
enabling mission critical devices in demanding environments. We offer a full line of compatible components and accessories to simplify
the replacement process and provide customer service to ensure a seamless transition to Low SwaP-C optics. Over their lifetime, our
optics are significantly cheaper from both an absolute cost and a cost per optic perspective. These lifetime costs, at current costs
and capacity, will naturally drop as we continue to take advantage of economies of scale.

Our
Growth Strategy

We
intend to leverage our competitive strengths, technology leadership and market share position to pursue our growth strategy through the
following:

○
Expand
Product Offerings. In the short-term, our aim is to further diversify our product offerings to give consumers, as well as
OEMs and distributors, more options for additional applications. This will be accelerated by the expansion of our production capacity
through organic and inorganic growth.

5

○
Expand
End-markets. Syntec Optics plans to further consolidate the fragmented photonics industry by expanding our portfolio of our
existing, U.S.-based, advanced manufacturing processes of making thin-film coated glass, crystal, or polymer components and their
housings, which are ultimately assembled into high performance hybrid electro-optics sub-systems. By doing so, Syntec Optics plans
to grow to the new end-markets of communications and sensing. Syntec entered the communications end-market in 2023. Syntec Optics
is currently engaged as a supplier for a U.S. Department of Commerce’s National Institute of Standards and Technology (“NIST”)
funded research and development project for the sensing end-market. The communication end-market is characterized by the use of optics
and photonics for data transmittal and reception of information, including, for example, satellite communications and other associated
applications. The sensing end-market is characterized by the use of optics and photonics to detect scattered light or light with
an altered refractive index due to the presence of a medium within a wide range of potential applications, including, for example,
disease detection and other associated applications.

○
Commercialize
Optics and Photonics Enabling Technology. We believe optics and photonics enabling technologies offer significant advantages
to glass optics and electronics enabled products currently on the market, with the potential to be lighter, smaller, higher-performing
and cheaper.

Our
core growth strategy also involves inorganic growth with complementary businesses to augment our existing unifying platform. Syntec plans
to run a disciplined process to arrive at a targeted list of companies it would like to acquire. Selected companies will have a good
management team and ownership that can apply industry findings to build the next great public company that enables light. Such a company
shall serve as a platform to add more diverse end-markets, achieve stable earnings growth, and build an R&D pipeline that brings
sustainable future growth.

Optics
and photonics companies are not clearly categorized in a small number of SIC codes, but Syntec’s long-term relationships with companies
led to a list of 100+ SICs where optics and photonics companies live. Quality of earnings, financial reporting, forecasting, controls,
and systems technology will also be used in the selection process for the roll-up.

Our
Products and Technology

Syntec
has built a solid foundation over many decades of developing new processes that produce various geometries and shapes of optical elements
used in both visible and IR spectrums. Syntec started with custom polymer optics to find a foothold and then expanded into various materials
for the Biomedical, Defense & Security, and Consumer/Industrial sectors. In 2023 it added communications as an additional end-market.
Syntec is at the forefront of innovation in single point diamond turning and has been pushing the frontiers of polymer and other materials
for use in a wide variety of optics applications and requiring tight tolerances.

Syntec’s
pioneering polymer-based optics provided numerous advantages compared to incumbent products, such as glass-based optics. Polymer-based
optics are smaller sized, lower weight, lower in power consumption, and a high cost-effective optical solution. Polymer-based optics
use polymers throughout the fabrication process which offers high production volume and fast repeatability. Other advantages of polymers
are their high impact resistance; polymers do not split like glass, making this type of optics highly durable and cost effective in applications
such as heads-up displays, goggles, and biomedical disposable optics. Another key advantage we offer customers is fast prototyping. While
advanced molding techniques are used for high volume productions and beta samples, we use nanomachining of polymers and other materials
for quick alpha samples. We further increased the competitive advantage by providing lower cost by manufacturing with in-house lower
cost glass molded glass. Often in cameras or optics sub-systems, glass and polymer elements are combined for a lower cost solution with
durability and higher performance.

Thanks
to their low density or low weight by volume, polymers are well adapted for making cutting-edge-technology products lighter and smaller.
Polymers are between two and half and five times lighter than comparable glass products and are suitable for difficult and sophisticated
refractive, reflective, and diffractive substrates with spherical, aspherical, and cylindrical prescriptions, thus reducing the number
of optical components needed in a given optical system. Molding is the most repeatable, consistent, and economical way to produce complex-shaped
optics in large volume or to integrate them onto a common substrate. Optical-grade polymers exhibit high light transmittance and are
comparable to high-grade glasses. The optical-grade polymer market is growing rapidly; new polymers with low birefringence as well as
higher and more stable refractive indices are available, offering design flexibility not possible with glass optics on their own.

Customers

Our
components are used in a variety of applications ranging from biometric, imaging, illumination, scanning, projection, blood analysis,
point of care diagnosis and fingerprint identification. Our components are also used in DNA sequencing, laser cutting, thermal imaging,
retinal eye scanning, military applications and blood analysis. By investing in new technology and reliable equipment Syntec Optics provides
low-cost precision solutions for challenging optical needs.

We
have deep, long-standing relationships with many of our customers. Our customers primarily utilize our products for defense and security,
optical diagnosis and imaging and projection lenses and heads-up displays. We work directly with customers to ensure compatibility with
existing designs and collaborate on custom design for new applications.

○
Defense
Optics – night vision goggles, missile systems and military LED lighting are just a few examples of the mission critical
components used by our defense and security customers

○
Biophotonics
– blood gas analyzer, bacteria analyzer and HIV detectors are used in medical procedures

○
Communication
Optics – low earth orbit satellite transmitters, receivers and high-precision mirrors are used in high-speed data transmission
processes

We
continue to seek to grow our customer base within our existing segments; however, we also believe that our products are well suited to
address the needs in additional segments, including semiconductor, communication, advanced manufacturing, sensing, lighting Solar-PV,
and displays and we will seek to expand our market share in these segments in the future.

Facilities

Our
corporate headquarters is in an approximately 90,000 square foot facility that we lease in Rochester, New York. This facility is leased from ELR Associates, LLC, a fully consolidated variable interest entity of Syntec Optics
Holdings Inc. The lease for this building
was entered into on July 23, 2015 for a 10-year period and has provisions for two extensions of 5 years each. The Company has exercised
the first extension (to July 2030), and we have the option to extend for an additional five-year term. We believe we will be able to
obtain additional space on commercially reasonable terms.

6

Supplier
Relationships

We
have a well-established global supply chain that underlies the sourcing of the components of our products, although we source domestically
whenever possible. We follow a lean manufacturing process and align our purchases with customer backlog. We prefer to pre-order in advance
for the year to ensure adequate supply. For nearly all our components, we ensure that we have alternate suppliers available. As a result
of our long-standing relationships with our suppliers, we are able to source materials on favorable terms within reasonable lead-times.

Sales
and Marketing

Our
proven sales and marketing strategy has allowed us to penetrate our current end-markets efficiently. We use a variety of methods to educate
consumers on the benefits of optics and photonics-enabled technologies and why they are a better investment compared to electronically
enabled technologies found in our target end-markets today. Through information found on our website and social media platforms that
educate consumers on the benefits of optics and photonics-enabled technologies, we assist consumers on how they may benefit from the
advanced manufacturing processes and technologies that we offer.

We
use a multi-pronged sales and marketing strategy to ensure that the Syntec Optics brand is at the forefront of its respective end-markets.
We have established strong relationships, particularly in the defense and biomedical industries through participation in trade shows
and other sponsored industry events, which have allowed us to reach customers to ensure we are aware of evolving customer preferences.
We are then able to leverage this customer feedback to collaborate on custom designs for new and existing applications.

We
value our customer relationships. Our website and our customer service are key elements to our sales strategy. Our website enables customers
to purchase off the shelf optics and provides access to a range of product information, technical benefits, and advanced manufacturing
services. We have a team of experts dedicated to supporting our customers’ sales, technical and service needs.

Competition

Syntec
is a vertically integrated advanced manufacturer of optics and photonics. At the public company level, competitors may have Syntec’s
suite of advanced manufacturing techniques under its corporate umbrella, but not likely under the same roof. This differentiation allows
Syntec to successfully serve OEM and Tier 1 suppliers in the Defense, Biomedical and Consumer/Industrial end-markets.

Advanced
manufacturers in the optics and photonics space enable end-products generally through a combination of materials, electromagnetic spectrum
or processes. Many of Syntec’s competitors specialize in aspects of these three areas and may not have in-house capabilities across
all three areas. For example, some of Syntec’s competitors specialize in precision motion optics, vision specialists, high-resolution
spectral cameras, electro-optical aerospace systems and or machine vision systems. Syntec can provide solutions to each of these specialty
areas by deploying its highly trained employee base and its patented intellectual property and trade secret processes.

7

In
certain instances, Syntec may collaborate on design and development of mission critical sub-components in its competitors’ products
given its broad advanced manufacturing capabilities. Syntec is excited to bring its unifying value proposition to the public market.

Intellectual
Property

The
success of our business and our technology leadership is supported by our proprietary optics and photonics enabling advanced manufacturing
processes and technologies. We have received patents and filed patent applications in the United States and other jurisdictions to provide
protection for our technology. We rely upon a combination of patent, trademark and trade secret laws in the United States and other jurisdictions,
as well as license agreements and other contractual protections, to establish, maintain and enforce rights in our proprietary technologies.
In addition, we seek to protect our intellectual property rights through non-disclosure and invention assignment agreements with our
employees and consultants and through non-disclosure agreements with business partners and other third parties.

As
of December 31, 2025 and as of December 31, 2024, we owned three active issued patents and one pending patent applications. The patents
and patent applications cover the United States. We periodically review and update our patent portfolio to protect our products and newly
developed technologies.

US
Patent 9192298B2 “Contact lens for intraocular pressure measurement” is an active worldwide application patent that is assigned
to and owned by Syntec Optics. The patent was granted in November 2015 and expires in April 2034.

US
Patent 10052731B2 “Flycutter having forced air cleaning” is an active worldwide application patent that is assigned to and
owned by Syntec Optics. The patent was granted in August 2018 and expires in December 2036.

US
Patent 11383414B2 “Parts degating apparatus using laser” is an active worldwide application patent that is assigned to and
owned by Syntec Optics. The patent was granted in July 2022 and expires in August 2040.

US
Patent Provisional 63/449,362 “Imaging Apparatus with Thermal Augmentation” is a provisional United States application. The
provisional patent application was filed on March 2, 2023.

We
periodically review our development efforts to assess the existence and patentability of new intellectual property. We pursue the registration
of our domain names and trademarks and service marks in the United States and other jurisdictions.

Government
Regulations

We
currently operate from a dedicated leased manufacturing facility located in Rochester, New York. We have never owned any facility at
which we operated. Operations at our facilities are subject to a variety of environmental, health and safety regulations, including those
governing the generation, handling, storage, use, transportation, and disposal of hazardous materials. To conduct our operations, we have
to obtain environmental, health and safety permits and registrations and prepare plans. We are subject to inspections and possible citations
by federal, state, and local environmental, health, and safety regulators. We have policies in place to assure compliance with our obligations
(for example, machine guarding, hot work, hazardous material management and transportation). We train our employees and conduct audits
of our operations to assess our fulfillment of these policies.

We
are also subject to laws imposing liability for the clean up and release of hazardous substances. Under the law, we can be liable even
if we did not cause a release on real property that we lease. We believe we have taken commercially reasonable steps to avoid such liability
with respect to our current leased facilities.

On
July 4, 2025, the One Big Beautiful Bill Act, commonly referred to as “OBBBA”, was signed into law as Public Law No. 119-21,
enacting sweeping reforms to domestic and international taxation. This legislation includes several provisions of significance to domestic
manufacturing companies with R&D expenditures:

OBBBA
restores full immediate tax deductibility for domestic research and experimental expenses incurred in 2025 and beyond. This reverses
the five-year amortization requirement previously mandated under the Tax Cuts and Jobs Act. The law also permits taxpayers to accelerate
unamortized domestic R&D expenditures incurred from January 1, 2022, through December 31, 2024, over one or two years, potentially
resulting in adjustments to prior-year tax filings.

The
law enshrines 100% first-year bonus depreciation for qualified tangible personal property placed into service after January 19, 2025,
including qualified production property (QPP) used in manufacturing facilities, potentially offering accelerated write-offs of capital
investments.

Under
U.S. GAAP, R&D costs incurred are expensed as incurred per ASC 730. The immediate tax expensing afforded by OBBBA may reduce book-tax
timing differences, simplify tax accounting, and align taxable income more closely with reported financial results.

Where
plausible, the Company plans to take advantage of these changes in 2025 and beyond. Presently, the impact is not significant, given our
current loss position.

8

Environmental
Matters

We
are subject to domestic and foreign environmental laws and regulations governing our operations, including, but not limited to, emissions
into the air and water and the use, handling, disposal and remediation of hazardous substances. A certain risk of environmental liability
is inherent in our production activities, operation of our systems and the disposal of our systems. These laws and regulations govern,
among other things, the generation, use, storage, registration, handling and disposal of chemicals and waste materials, the presence
of specified substances in electrical products, the emission and discharge of hazardous materials into the ground, air or water, the
clean up of contaminated sites, including any contamination that results from spills due to our failure to properly dispose of chemicals
and other waste materials and the health and safety of our employees.

Export
and Trade Matters

We
are subject to anti-corruption laws and regulations imposed by governments around the world with jurisdiction over our operations, including
the U.S. Foreign Corrupt Practices Act, as well as the laws of the countries where we do business. We are also subject to various trade
restrictions, including trade and economic sanctions and export controls, imposed by governments around the world with jurisdiction over
our operations. For example, in accordance with trade sanctions administered by the U.S. Department of Treasury’s Office of Foreign
Assets Control and export controls administered by the U.S. Department of Commerce, we are prohibited from engaging in transactions involving
certain persons and certain designated countries or territories, including Cuba, Iran, Syria, North Korea and the Crimea Region of Ukraine.
In addition, our systems may be subject to export regulations that can involve significant compliance time and may add additional overhead
cost to our systems. In recent years the United States government has a renewed focus on export matters. For example, the Export Control
Reform Act of 2018 and regulatory guidance thereunder have imposed additional controls and may result in the imposition of further additional
controls, on the export of certain “emerging and foundational technologies.” Our current and future systems may be subject
to these heightened regulations, which could increase our compliance costs.

See
“Risk Factors—We are subject to U.S. and foreign anti-corruption and anti-money laundering laws and regulations and could
face criminal liability and other serious consequences for violations, which could adversely affect our business, financial condition
and results of operations” for additional information about the anti-corruption and anti-money laundering laws that may affect
our business.

Legal
Proceedings

We
may be subject to legal proceedings, investigations and claims incidental to the conduct of our business from time to time. We are not
currently a party to any material litigation or other legal proceedings brought against us. We are also not aware of any legal proceeding,
investigation or claim, or other legal exposure that has a more than remote possibility of having a material adverse effect on our business,
financial condition or results of operations.

See
“Risk Factors—Any future litigation against us could be costly and time-consuming to defend.”

Employees
and Human Capital Resources

As
of December 31, 2025, we have 164 employees. We have adopted our Code of Ethics to support
and protect our culture, and we strive to create a workplace culture in line with our values: “Integrity”, “Humility”,
“Innovation”, “Discipline”, and “Continuous Improvement” and help our customers “Change the
way the world views itself, one optic at a time.” As part of our initiative to retain and develop our talent, we focus on these
key areas:

○
Safety
– Employees are regularly educated on safety around their workspaces, and employees participate in volunteer roles
on a safety committee, and in emergency readiness roles. We have a dedicated safety coordinator who tracks and measures our performance
and helps us benchmark our safety programs against our peers.

9

○
Collaboration
– As we grow, opportunities for cross-functional collaboration may not be as organic as they used to be. We have responded
to that challenge by staying mindful and acting intentionally to gather cross-functional input on new initiatives and continuous
improvement efforts.

○
Continuous
Improvement – We apply continuous improvement measure to processes as well as people. We encourage professional development
of our employees, through ongoing learning, credentialing, and collaboration with their industry peers.

Attracting
and retaining high quality talent at every level of our business is crucial to our continuing success. We have developed relationships
with the University of Rochester to further our recruitment reach. We provide competitive compensation and benefit packages, including
performance-based compensation that rewards individual and organizational achievements.

Earnout
Merger Consideration

Additional contingent shares (“Contingent Earnout Shares”) may
be payable to each holder of shares of Legacy Syntec Common Stock in the Merger, subject to achieving specified milestones, up to an
aggregate of 26,000,000 additional shares of Common Stock in three tranches.

Syntec
Optics Holdings, Inc. will issue 26,000,000 additional shares of Common Stock (the “Contingent Earnout”) to Legacy Syntec’s
existing stockholders, which Contingent Earnout shares will vest upon achievement of the targets set forth in Section
3.4(b) of the Business Combination Agreement. The Contingent Earnout shares will vest upon the Company’s Common Stock achieving
the following stock trading price thresholds (the “Contingent Earnout Trigger Price”) following the Closing: one-third (1/3rd)
at $12.50 per share, one-third (1/3rd) at $14.00 per share, and one-third (1/3rd) at $15.50 per share (as adjusted
for stock splits, stock dividends, reorganizations, recapitalizations and the like). The Contingent Earnout shares which remain unvested
as of the date five (5) years from the Closing (the “Earnout Period”) will be deemed cancelled and no longer subject to vesting.
The achievement of the Contingent Earnout Trigger Price will be based on either (a) the closing price of the Company’s common stock
equaling or exceeding the specified threshold for twenty (20) trading days within any thirty (30)-trading day period following the Closing,
or (b) upon the consummation of a change of control transaction in which the per share price implied in such change of control transaction
is greater than or equal to the applicable threshold. All Contingent Earnout shares will be issued pro rata to Legacy Syntec stockholders
in proportion to their owned shares of Legacy Syntec common stock immediately prior to the Closing.

Syntec
Optics Holdings, Inc. will issue up to 2,000,000 shares of Common Stock (the “Performance-based-Earnout”) to members
of the management team of the Company from time to time, to the extent determined by the Board of Directors in its sole discretion, to
be issued as restricted stock units or incentive equity grants pursuant to the Incentive Plan described below in Note 14. The Performance-based
Earnout shares shall be awarded by the Board of Directors based on achieving the following performance thresholds following the Closing:
one-half (1/2) at achieving revenue of $75 million and adjusted EBITDA of $22.6 million based on 2024 financial audited statements, and
one-half (1/2) at achieving revenue of $196 million and adjusted EBITDA of $50.6 million based on the 2025 financial audit statement.
No such awards have been made as of December 31, 2025.

A
description of the Merger and the terms of the Business Combination Agreement are included in the proxy statement/prospectus, dated October
5, 2023 (the “Proxy Statement/Prospectus”) as filed with the Securities and Exchange Commission (the “SEC”)
in the section entitled “Proposal No. 1 — The Business Combination Proposal” of the Proxy Statement/Prospectus.

The
foregoing description of the Earnout Merger Consideration is a summary only and is qualified in its entirety by the full text of the
Business Combination Agreement, a copy of which is attached hereto as Exhibit 2.1, which are incorporated herein by reference.

10

Item
1.01 Entry into a Material Definitive Agreement.

Debt
Financing

Credit Agreement with M&T Bank

On November 8, 2023, Syntec Optics
Holdings, Inc. (the “Company”) entered into an Amended and Restated Credit Agreement (the “Credit Agreement”)
with M&T Bank (the “Lender”) to refinance its prior indebtedness. Proceeds from the refinancing were used to repay approximately
$6.1 million under a prior revolving credit facility, approximately $1.1 million under a prior term loan, approximately $0.9 million under
a prior mortgage loan, and to pay related transaction expenses.

The
Credit Agreement provides for:

● A
revolving credit facility with a commitment currently set at $7.5 million and maturing in
November 2026;

● Term
and equipment loan facilities (which, as described below, were repaid in November 2025).

Borrowings
under the revolving facility bear interest at a rate equal to one-month Secured Overnight Financing Rate (“SOFR”) plus an
applicable margin of 3.00%. The Credit Agreement contains customary representations and warranties, affirmative and negative covenants,
and financial covenants, including a minimum fixed charge coverage ratio and a maximum total leverage ratio.

Covenant
Waivers and Amendments

During
2025 and 2024, the Company obtained certain waivers and amendments related to its financial covenants.

As
previously disclosed, the Company was not in compliance with certain financial covenants during 2024 and received amendments and waivers
from the Lender, including modifications to leverage ratio thresholds and temporary suspension of the fixed charge coverage ratio for
a specified period.

As
of September 30, 2025, the Company was not in compliance with certain financial covenants under the Credit Agreement. On November 12,
2025, the Company received a written waiver from M&T Bank with respect to those covenant defaults. In connection with the waiver,
the Company agreed to:

● Repay
approximately $1.37 million of outstanding term and equipment indebtedness;

● Reduce
the revolving credit commitment from $8.0 million to $7.5 million; and

● Execute
subordination agreements with respect to certain shareholder indebtedness.

No
amendment fees were paid to M&T Bank in connection with the November 2025 waiver or the December 2025 amendment; however, the Company
paid a prepayment premium of $63,416 in connection with the repayment of term and equipment debt.

Effective
December 31, 2025, the Company entered into a Second Amendment to the Amended and Restated Credit Agreement and executed a replacement
revolving note reflecting the previously agreed reduction of the revolving credit commitment to $7.5 million. The amendment did not modify
the maturity date (November 2026) or the existing financial covenant thresholds applicable for 2026.

As
of December 31, 2025, and through the date of this filing, the Company is in compliance with the financial covenants under the
Restated Credit Agreement.

11

Repayment
of Term and Equipment Debt; Shareholder Note

On
November 12, 2025, the Company repaid in full two term and equipment notes with M&T Bank in the aggregate amount of $1,368,732.49.

To
fund this repayment, the Company entered into a subordinated term note with its majority stockholder in the principal amount of $1,268,732.49
(the “Shareholder Note”). The Shareholder Note:

● Was
issued by Syntec Optics Holdings, Inc.;

● Bears
interest at 6.953% per annum;

● Amortizes
over 35 monthly payments;

● Matures
on October 31, 2028, at which time all remaining principal and accrued interest are due;
and

● Is
expressly subordinated to the Company’s obligations under the Credit Agreement.

The
Company and the majority stockholder entered into a subordination agreement with M&T Bank. The subordination agreement prohibits
prepayments of the Shareholder Note and restricts payments to interest only, subject to prior written approval by M&T Bank, which
may be granted or withheld in the Lender’s discretion. There are no cross-default provisions between the Shareholder Note and the
Credit Agreement.

Outstanding
Borrowings and Covenant Status

As
of December 31, 2025, the Company had $6,763,863 outstanding under the revolving credit facility.

As
of December 31, 2025, the Company was in compliance with all applicable financial covenants under the Credit Agreement.

Warrant
Agreements

The
shares issuable upon exercise of the Warrants have customary registration rights, which are contained in the respective forms of the
Warrants, requiring the Company to file and keep effective a resale registration statement registering the resale of the shares of Common
Stock underlying the Warrants.

The
foregoing description of the Warrants is a summary only and is qualified in its entirety by reference to the full text of the Warrants,
copies of which are attached hereto as Exhibit 4.4, respectively, and are incorporated herein by reference.

Related
Agreements

Concurrently
with the execution of the Business Combination Agreement, OmniLit, Legacy Syntec and the Sponsor entered into a sponsor support agreement,
a copy of which is attached as Exhibit 10.4 and is incorporated herein by reference.

Indemnification
of Directors and Officers

On
the Closing Date, in connection with the consummation of the Transactions, the Company entered into indemnification agreements with each
of its directors and executive officers. These agreements, among other things, will require the Company to indemnify the Company’s
directors and executive officers for certain expenses, including attorneys’ fees, judgments and fines incurred by a director or
executive officer in any action or proceeding arising out of their services as one of the Company’s directors or executive officers
or any other company or enterprise to which the person provides services at the Company’s request.

The
foregoing description of the indemnification agreements does not purport to be complete and is qualified in its entirety by reference
to the full text of the form of indemnification agreement, a copy of which is attached hereto as Exhibit 10.7 and is incorporated herein
by reference.

Registration
Rights Agreement

On
the Closing Date, in connection with the consummation of the Transactions, the Company entered into the Amended and Restated Registration
Rights Agreement (the “Registration Rights Agreement”) with the Sponsor, OmniLit’s officers, directors, initial
stockholders, non-redemption agreement investors (collectively, the “Insiders”) and certain Legacy Syntec stockholders.

12

The
foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference
to the full text of the Registration Rights Agreement, a copy of which is attached hereto as Exhibit 4.6 and is incorporated herein by
reference.

Corporate
Information

The
mailing address of our principal executive office is 515 Lee Rd., Rochester, New York 14606, and our telephone number is (585) 768-2513.

We
file periodic reports, proxy statements and other information with the SEC. Such reports, proxy statements and other information may
be obtained, free of charge, by visiting the SEC’s website at www.sec.gov that contains all of the reports, proxy and information
statements, and other information that we electronically file or furnish to the SEC. We also maintain a website at www.syntecoptics.com
where we make available the proxy statements, press releases, registration statements and reports on Forms 3, 4, 8-K, 10-K and 10-Q that
we (and in the case of Section 16 reports, our insiders) file with the SEC. These forms are made available as soon as reasonably practicable
after such material is electronically filed with or furnished to the SEC. Press releases are also issued via electronic transmission
to provide access to our financial and product news, and we provide notification of and access to voice and internet broadcasts of our
quarterly and annual results. Our website also includes investor presentations and corporate governance materials.