50 added · 45 removed between the two most recent 10-Ks. The risks a company starts — or stops — disclosing are often the story.
Newly disclosed
The Company also incurred impairment of goodwill and intangible assets of $5.8 million related to the sensor reporting until offset by $1.4 million credit for the employee retention credit. 44 Table of Contents Cash Flows For the Year Ended December 31, 2025 as Compared to the Year Ended December 31, 2024 As of December 31, 2025, cash on hand was $29.9 million, an increase of $26.2 million or 726.2%, as compared to $3.6 million as of December 31, 2024.
(incorporated by reference to Exhibit 10.3 of the Current Report on Form 8-K filed on February 8, 2024). 10.22 Omnibus Agreement, dated September 30, 2024, by and between AgEagle Aerial Systems, Inc. and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed on October 2, 2024). 10.23 Funding Agreement, dated February 7, 2025 by and between AgEagle Aerial Systems Inc., and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-k filed on February 10,2025). 10.24 Executive Employment Agreement, Dated April 14,2025, by and between AgEagle Aerial Systems Inc. and Alison Burgett (incorporated b reference to Exhibit 10.1 of the Current Report on Form 8-K filed on April 16, 2025). 10.25 Form of Securities Purchase Agreement, dated November 5, 2025, by and between AgEagle Aerial Systems Inc. and the investors signatory thereto (incorporated by reference to Exhibit 10.1 of the Current Report on the Form 8-K filed on November 6, 2025). 14.1 Code of Ethics of the Registrant Applicable To Directors, Officers And Employees (incorporated by reference to the Registration Statement on Form S-1 (Reg.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America Substantial Doubt Regarding Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.
In addition to sales of Series F Preferred and Series F Preferred in 2025, we believe our current cash balance, and working capital, help alleviate previous doubt regarding our ability to continue as a going concern.
Intangible Impairment The annual intangible impairment conducted during the fourth quarter of 2025 indicated an impairment of $1.3 million related to the sensor reporting u nit.
As of December 31, 2025, the carrying value of goodwill and intangible assets, after the impairment charges, is zero for the sensor's reporting unit.
The increase in cash used in operating activities was driven by $8.6 million warrant liability change offset by $5.8 million impairment expense and paydown of accounts payable of $1.3 million.
Impairment Goodwill Impairment For the year ended December 31, 2025, goodwill impairment was $4.5 millio n.
The intangible assets related to the historical acquisitions were fully impaired as of December 31, 2025, leaving a balance of $56,850 for internal use software, compared to the balance of $2.0 million as of December 31,202 4 . 42 Table of Contents Share-Based Compensation Awards The value we assign to the options that we issue is based on the fair market value as calculated by the Black-Scholes pricing model.
The increase in gross profit margin was a result of cost of sales decreasing, during 2025 resale agreements were renegotiated to limit discounts on product sales and encourage resellers to achieve hit certain sales targets to achieve larger discounts.
The decrease was driven by reductions in legal fees, consulting fees, stock compensation costs and the decrease in shareholder special meeting costs. 43 Table of Contents Research and Development For the year ended December 31, 2025, research and development expenses were $3.6 million as compared to $4.0 million for the year ended December 31, 2024, a decrease of $0.4 million or 9.0%.
As of December 31, 2025, our cash balance was sufficient enough to meet our financial obligations for at least the next twelve months from the date the consolidated financial statements are issued, and we believe we have access to sufficient capital to implement our business strategy while meeting our financial obligations under the Purchase Agreement.
No longer disclosed
Additionally, as of December 31, 2023 the Company recorded an aggregate intangible assets impairment of $5.9 million, no intangible impairment was recorded for the same period during the year ended December 31, 2024. 42 Share-Based Compensation Awards The value we assign to the options that we issue is based on the fair market value as calculated by the Black-Scholes pricing model.
(incorporated by reference to Exhibit 10.3 On Form 8-K filed on February 8, 2024). 10.33 Omnibus Agreement, dated September 30, 2024, by and between AgEagle Aerial Systems, Inc. and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.1 On Form 8-K filed on October 2, 2024). 14.1 Code of Ethics of the Registrant Applicable To Directors, Officers And Employees (Incorporated by reference to the Registration Statement on Form S-1 (Reg.
The annual intangible impairment conducted during the fourth quarter of 2023 indicated that the fair value of the SaaS and the Company’s Drones reporting units were less than carrying value.
Intangible Impairment The annual intangible impairment conducted during the fourth quarter of 2024 indicated no impairment.
If the Company is unable to generate significant sales growth in the near term and raise additional capital, there is a risk that the Company could default on additional obligations; and could be required to discontinue or significantly reduce the scope of its operations if no other means of financing operations are available.
The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities or any other adjustment that might be necessary should the Company be unable to continue as a going concern.
F- 2 Goodwill and other finite-lived intangibles – impairment assessment As described in Note 2, Note 4, and Note 5 to the consolidated financial statements, management evaluates goodwill and other finite-lived intangible assets on an annual basis, or more frequently if impairment indicators exist, at each reporting unit level.
The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment as a critical audit matter was the significant judgement by management to determine the fair value estimates, which in turn led to a high degree of auditor judgement, subjectivity and effort in performing procedures and in evaluating management’s significant assumptions in determining fair value, including the involvement of professionals with specialized skill and knowledge.
Our audit procedures related to the impairment assessment of the Company’s reporting units included the following, among others: ● Evaluating management’s process for determining the fair value of its reporting unit. ● Evaluating the appropriateness of the valuation methods utilized. ● Evaluating management’s ability to accurately forecast future revenue and operational costs by comparing prior year forecasts to actual results in the current year. ● Testing the reasonableness of the forecasts and consistency with the historical performance of the Company. ● Evaluating the consistency of external market and industry data. ● Testing the completeness and accuracy of the underlying data utilized by management in the methodologies to determine estimated fair value. ● Evaluating the reasonableness of the discount rate utilized in the discounted cash flow model with the assistance of our internal valuation specialists.
Impairment Goodwill Impairment For the year ended December 31, 2024, goodwill impairment was $2.9 million.
The increase in gross profit margin was a result of our drone products along with significant price reduction in the second and third quarter of 2023 to stimulate market demand and bring us in line specifically with competitive products manufactured in China.
The decrease was driven by reduction in employee payroll related costs due to integration of roles, ERP consulting integration costs, less stock compensation costs offset by increased shareholder annual meeting costs. 43 Research and Development For the year ended December 31, 2024, research and development expenses were $4.0 million as compared to $5.5 million for the year ended December 31, 2023, a decrease of $1.5 million or 27.3%.