{"url_path":"/sec/fdct/10-k/2026/item-3","section_key":"item-3","section_title":"Item 3 **","topic":"sec","document":{"doc_type":"10-K/A","doc_date":"2026-06-08","source_url":"https://www.sec.gov/Archives/edgar/data/1722731/0001493152-26-027724-index.html","accession_number":"0001493152-26-027724","cik":"0001722731","ticker":"FDCT","issuer_name":"FDCTECH, INC.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1722731/0001493152-26-027724-index.html","primary_entity_key":"0001722731","primary_entity_name":"FDCTECH, INC."},"word_count":962,"has_tables":true,"body_markdown":"**ITEM\n3.**\n**LEGAL\nPROCEEDINGS**\n\n \n\nThe\nCompany and its subsidiaries are involved in the following legal proceedings:\n\n \n\n**Asher\nAlkoby, et al. v. FDCTech**\n\n \n\nThis\naction is pending in the London Circuit Commercial Court under Claim Number LM-2024-000330 as of December 9, 2024. The claimants are\nAsher Alkoby and other former shareholders of Alchemy Markets Ltd. (“AML”), a Malta-incorporated broker that FDCTech purchased\nin June 2023. Following completion of the acquisition, the Company discovered that in 2019, the target company had anti-money laundering\ndeficiencies and was fined by the Financial Intelligence Analysis Unit.\n\n \n\nAn\nexternal audit also revealed that the previous shareholders had taken loans from the company that were never repaid, resulting in the\nnet capital of the company being lower than disclosed during negotiations. Based on these findings, FDCTech withheld the final payment\nto the sellers.\n\n \n\nThe\nclaimants are seeking approximately $1.02 million in amounts they allege are owing under the Share Sale Agreement, which they are seeking\nto rectify to make it legally enforceable. The Company has counterclaimed for a declaration that the Share Sale Agreement is ineffective\nand unenforceable and seeks repayment of $915,000 paid to the sellers. On October 17, 2025, the Court granted the claimants permission\nto amend their claim to include a third claimant. The Company has prepared an Amended Defense and Counterclaim through Counsel, which\nwas served May 9, 2025. A Costs and Case Management Conference took place on November 17, 2025, at which directions will be given to\nthe trial, which will take place in November 2026.\n\n \n\n**FDCTech,\nInc. v. Intelligenceline.com, Fintelegram.com, et al.**\n\n \n\nThis\naction is pending in the Superior Court of California, County of Orange. FDCTech alleges that the defendants, through their websites\nIntelligenceline.com, Fintelegram.com, and Criticalintel.com, published false and defamatory statements accusing the Company of fraud,\nillegal conduct, and regulatory violations. The Company claims these statements have caused significant reputational and financial harm,\nincluding lost business opportunities. FDCTech further alleges that the defendants engaged in an extortion scheme by demanding payment\nfor the removal of defamatory content.\n\n \n\nThe\ncomplaint asserts claims for defamation per se, defamation per quod, trade libel, and false light, seeking damages and injunctive relief.\nThe complaint was filed in 2025 but had not yet been served as of December 31, 2025. A hearing took place on December 15, 2025, at the\nCompany’s motion. Following the hearing, the court instructed FDCTech to conduct an investigation as to the beneficial owner of\nIntelligenceline.com.\n\n \n\n**Alchemy\nMarkets Ltd. v. Il-Korp għall-Analizi ta’ Informazzjoni Finanzjarja (Ref: 104/2023)**\n\n \n\nThis\nappeal is pending before the Court of Appeal (Inferior Jurisdiction) in Malta. On September 23, 2023, the Financial Intelligence Analysis\nUnit (FIAU) imposed an administrative penalty of €419,997 and a follow-up directive on Alchemy Markets Ltd. (formerly NSFX Limited),\na subsidiary of the Company, based on a compliance examination conducted between November 25, 2019, and December 5, 2019. The examination\noccurred approximately four years prior to the decision and under a different ownership and control of the subsidiary.\n\n \n\nThe\nCompany filed this appeal on October 19, 2023, challenging the decision-making process that led to the imposition of the penalty as well\nas the law on which it was based, asserting that the penalty is arbitrary and excessive, and claiming that certain aspects of the decision\nare unfounded both by law and in fact. The Company seeks to overturn the administrative penalty and the follow-up directive imposed by\nFIAU. The case is in the evidentiary production stage pertaining to the Company as appellant. On October 24, 2025, a hearing was held\nfor the Company to continue presenting evidence. The Court scheduled an additional hearing for the FIAU to cross-examine the Company’s\nwitnesses for February 2, 2026, to be heard before Madam Justice Rachel Montebello, following which the matter will be adjourned for\nfinal legal submissions.\n\n \n\n**Alchemy\nMarkets Ltd. v. L-Avukat tal-Istat u Il-Korp għall-Analizi ta’ Informazzjoni Finanzjarja (Ref: 159/2024)**\n\n \n\nThis\nconstitutional challenge is pending before the First Hall Civil Court (Constitutional Jurisdiction) in Malta and relates to the same\nSeptember 23, 2023, FIAU decision described above. The Company filed this application on April 2, 2024, challenging: (i) the composition\nof the FIAU and its enabling law; (ii) the decision-making processes which allegedly breach the Company’s fundamental human right\nto a fair hearing; and (iii) that given the penal nature of the penalty, in breach of the Constitution of Malta, the Company was not\nadjudged by an independent court. The Company requests the Constitutional Court to set aside the FIAU decision in its entirety.\n\n \n\nA\nfirst procedural hearing took place on May 7, 2024, and the Company has brought its evidence in support of the claim. The First Hall\nCivil Court (Constitutional Jurisdiction) has, in various instances, pronounced that administrative penalties being imposed by the FIAU\nare more akin to a penal sanction and that, therefore, subject persons should be afforded the full rights afforded to an accused under\ncriminal law and has consistently quashed FIAU decisions on this basis. While these judgments are, in most part, subject to further appeal\nbefore the Constitutional Court of Appeal and have, in two instances, been overturned by the Constitutional Court of Appeal, the Company\nconsiders that the principles underpinning such previous judgments are applicable to the Company. The case remains pending as of January\n21, 2026; the next hearing in the matter is set for January 28, 2026.\n\n \n\nThe\nCompany believes it has meritorious defenses and counterclaims in the above matters and intends to defend them vigorously. However, litigation\nis inherently uncertain, and the Company cannot predict the outcome of these proceedings with certainty.\n\n \n\nThere\nare no additional material pending legal or governmental proceedings other than ordinary routine litigation incidental to the business.\nThe Company or any of its subsidiaries is a party, or their property is the subject."}