Company: WKSP
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000850
Chunk: 112

Company: Worksport Ltd
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1
Chunk 112
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 may initiate against third parties seeking to invalidate the patents held by such third
    parties or to obtain a judgment that our products do not infringe such third parties’ patents; and

    ●
    litigation
    or other proceedings third parties may initiate against us to seek to enforce their patents and/or invalidate our patents.

If
third parties initiate litigation claiming that our products infringe their patent or other intellectual property rights, we will need
to defend against such proceedings.

The
costs of resolving any patent litigation or other intellectual property proceeding, even if resolved in our favor, could be substantial.
Many of our potential competitors will be able to sustain the cost of such litigation and proceedings more effectively than we can because
of their substantially greater resources. In some instances, competitors may proceed with litigation or other proceedings pertaining
to infringement of their intellectual property as a means to hinder or devaluate the target defendant company, with no intention of the
matter being resolved in their favor. Uncertainties resulting from the initiation and continuation of patent litigation or other intellectual
property proceedings could have a material adverse effect on our ability to compete in the marketplace. Patent litigation and other intellectual
property proceedings may also consume significant management time and costs. Substantial additional costs may be evident in the event
that litigation or other proceedings were initiated against us because we would have to seek legal defense or counsel in the province
(Canada) or state (U.S.) where the litigation or legal proceedings were filed. Failure to adequately protect our intellectual property
rights could result in our competitors offering similar products, potentially resulting in the loss of some of our competitive advantage,
and a decrease in our revenue which would adversely affect our business, prospects, financial condition and operating results.

22

Confidentiality
agreements with employees and others may not adequately prevent the disclosure of trade secrets and other proprietary information.

In
order to protect our proprietary technology and processes, we also rely in part on confidentiality agreements with our employees, consultants,
outsourced manufacturers and other advisors. These agreements may not effectively prevent the disclosure of confidential information
and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, others may independently
discover trade secrets and proprietary information. Costly and time-consuming litigation could be necessary to enforce and determine
the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive
business position.

There
are risks associated with outsourced production that may result in a decrease in our profit.

The