What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-03-12 compared with 2025-03-27 · 333 added, 243 removed, 612 unchanged (48% of the section changed)

1 unchanged sentence

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Stockholders and Board of Directors

BK Technologies Corporation

To the Board of Directors and

Stockholders of BK Technologies Corporation

West Melbourne, Florida

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of BK Technologies Corporation and subsidiaries (the “Company”) as of December 31, 2024, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements referred to above 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.

We also have audited the adjustments to the 2023 consolidated financial statements of the Company to retrospectively apply the change in accounting related to the Company’s adoption of ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures as described in Note 1.

In our opinion, such adjustments are appropriate and have been properly applied.

We were not engaged to audit, review or apply any procedures to the 2023 consolidated financial statements of the Company other than with respect to the adjustments and, accordingly, we do not express an opinion or any other form of assurance on the 2023 consolidated financial statements taken as a whole.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of BK Technologies Corporation (the “Company”) as of December 31, 2025, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year ended December 31, 2025, and the related notes (collectively, the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

Prior Period Financial Statements

The financial statements of the Company as of and for the year ended December 31, 2024 were audited by other auditors whose report dated March 27, 2025 expressed an unqualified opinion on those statements.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with U.S.

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audit.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

2 unchanged sentences

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As a part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Stockholders and Board of Directors

BK Technologies Corporation

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Allowance for Slow-Moving, Excess, and Obsolete Inventory

As more fully disclosed in Notes 1 and 2 of the notes to the Company’s consolidated financial statements, the Company records an estimated allowance for slow-moving, excess, and obsolete inventory to state the Company’s inventories at the lower of cost or net realizable value.

The Company relies on, among other things, past sales and usage experience, significant assumptions such as future sales and usage forecasts, and its strategic business plan to develop the estimate.

As a result of management’s assessment, the Company recorded an allowance for slow-moving, excess, and obsolete inventory of approximately $1,694,000 as of December 31, 2024.

We identified the allowance for slow-moving, excess, and obsolete inventory as a critical audit matter.

Our principal consideration for this determination is the high degree of auditor judgement and subjectivity involved in evaluating management’s significant assumptions related to estimating the allowance, particularly as it relates to evaluating assumptions related to future inventory turnover and sales.

The following are the primary procedures we performed to address this critical audit matter:

● We obtained an understanding and evaluated the design and implementation of internal controls relating to recording inventory at the lower of cost or net realizable value.

● We evaluated the completeness and accuracy of the underlying data used in development of the allowance for slow-moving, excess, and obsolete inventory, including the mathematical accuracy of the calculation.

● For a sample of raw materials, work-in-progress (WIP) and finished goods inventory at year-end, we compared recorded amounts to supporting documentation for original cost.

● We evaluated the reasonableness of the Company’s estimate by comparing historical allowance amounts to the history of actual inventory write-offs.

● We evaluated the reasonableness of management’s business plan and forecasts of future sales assumptions, including expected changes in technology and product lines, and whether the assumptions used were reasonable considering historical sales and expectations regarding future sales.

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgements.

We determined that there were no critical audit matters.

/s/ Cherry Bekaert LLP

We have served as the Company’s auditor since 2025.

/s/ Forvis Mazars, LLP

Orlando, Florida

Tampa, Florida

March 12, 2026

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Stockholders

To the Stockholders, Board of Directors, and Audit Committee

BK Technologies Corporation

West Melbourne, Florida

Opinion on the Consolidated Financial Statements

We have audited, before the effects of the adjustments to retrospectively apply the change in accounting described in Note 1, the accompanying consolidated balance sheet of BK Technologies Corporation (the “Company”) as of December 31, 2023, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year ended December 31, 2023, and the related notes (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements referred to above, before the effects of the adjustments to retrospectively apply the change in accounting (as described in Note 1), present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

We were not engaged to audit, review, or apply any procedures to the adjustments to retrospectively apply the change in accounting (as described in Note 1), and, accordingly, we do not express an opinion or any other form of assurance about whether such adjustment are appropriate and have been properly applied.

Those adjustments were audited by Forvis Mazars, LLP.

Basis for Opinion

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We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

Accordingly, we express no such opinion.

2 unchanged sentences

We believe that our audit provides a reasonable basis for our opinion.

We have served as the Company’s auditor from 2015 to 2024.

/s/ MSL, P.A.

We served as the Company’s auditor from 2024 to 2025.

/s/ Forvis Mazars, LLP

Orlando, Florida

15 unchanged sentences

Deferred tax assets, net

Capitalized product development cost

Capitalized software and systems integration costs

$ 63,760 $ 51,499

7 unchanged sentences

Short-term operating lease liabilities

Credit facility

Notes payable-current portion

Deferred revenue

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Years Ended December 31,

$ 86,139 $ 76,592

Cost of products

Selling, general and administrative

Total operating expenses

Operating income (loss)

Other (expense) income:

Net interest (expense)

44,112 47,542

42,027 29,050

Selling, general, and administrative expenses:

Engineering and product development

Marketing and selling

General and administrative

Total selling, general and administrative expenses

26,040 21,222

Operating income

Other income (expense):

Net interest income (expense)

Gain on disposal of property, plant, and equipment

1 unchanged sentence

Other (expense)

Total other expense

Income (loss) before income taxes

Provision for income tax benefit (expense)

Net income (loss)

Net income (loss) per share-basic

Net income (loss) per share-diluted

( 135 ) ( 98 )

Total other income (expense)

Income before income taxes

Provision for income tax (expense) benefit

( 2,581 ) 984

$ 13,536 $ 8,359

Net income per share-basic

$ 3.69 $ 2.35

Net income per share-diluted

$ 3.44 $ 2.25

Weighted average shares outstanding-basic

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Balance at December 31, 2023

Common stock issued

3,867,082 $ 2,320 $ 48,602 $ ( 24,209 ) $ ( 5,402 ) $ 21,311

Common stock issued-stock options

4,637 2 30 — — 32

Common stock issued-restricted stock units

33,799 20 ( 20 ) — — —

Common stock issued-warrants exercised

8,441 6 ( 6 ) — — —

Share-based compensation expense-stock options

— — 286 — — 286

Shared-based compensation expense-restricted stock units

Common stock warrants issued

— — 494 — — 494

Treasury shares

— — — — ( 651 ) ( 651 )

— — — 8,359 — 8,359

Balance at December 31, 2024

3,913,959 2,348 49,386 ( 15,850 ) ( 6,053 ) 29,831

Common stock issued-stock options

32,899 19 579 — — 598

Common stock issued-restricted stock units

55,015 33 ( 33 ) — — —

Common stock issued-warrants exercised

90,183 55 ( 55 ) — — —

Share-based compensation expense-stock options

— — 1,030 — — 1,030

Shared-based compensation expense-restricted stock units

— — 896 — — 896

Treasury shares

— — — — 55 55

Repurchase of common stock

( 1,248 ) ( 1,248 )

— — — 13,536 — 13,536

Balance at December 31, 2025

4,092,056 $ 2,455 $ 51,803 $ ( 2,314 ) $ ( 7,246 ) $ 44,698

See notes to consolidated financial statements.

4 unchanged sentences

Operating activities

Net income (loss)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

$ 13,536 $ 8,359

Adjustments to reconcile net income to net cash provided by operating activities:

Allowance for credit losses

Inventory allowance

Amortization of deferred finance costs and other assets

Deferred tax benefit

Amortization of deferred finance and other assets

Deferred tax expense (benefit)

1,558 ( 2,672 )

Depreciation and amortization

1 unchanged sentence

Share-based compensation expense-restricted stock units

Loss on investments

Loss on investment

(Gain) on sale of equipment

2 unchanged sentences

Prepaid expenses and other current assets

Capitalized product development cost

1,782 ( 2,989 )

Operating lease ROU assets and lease liabilities

( 84 ) ( 68 )

Accounts payable

( 1,546 ) ( 3,495 )

Accrued compensation and related taxes

2 unchanged sentences

Accrued other expenses and other current liabilities

( 1,559 ) 1,531

Net cash provided by operating activities

19,441 12,765

Investing activities

Purchases of property, plant and equipment

( 1,039 ) ( 1,235 )

Capitalized software and systems integration costs

( 2,096 ) ( 1,321 )

Proceeds for disposal of property, plant and equipment

Net cash (used in) investing activities

( 3,133 ) ( 2,556 )

Financing activities

Proceeds from issuance of common stock options

Proceeds from issuance of common stock warrants

Proceeds from exercise of common stock options

Repurchase of common stock

Proceeds from credit facility and notes payable

Repayment of credit facility and notes payable

Net cash (used in) provided by financing activities

Net cash (used in) financing activities

( 595 ) ( 6,590 )

Net change in cash and cash equivalents

1 unchanged sentence

Cash and cash equivalents, end of year

$ 22,788 $ 7,075

Supplemental disclosure

2 unchanged sentences

Common stock issued under restricted stock units

Cashless exercise of stock options and related conversion of net shares to stockholders’ equity

Cashless exercise of stock options, warrants and related conversion of net shares to stockholders’ equity

See notes to consolidated financial statements.

99 unchanged sentences

Some of these manufacturers and suppliers are in other countries.

Approximately 17.0 % of the Company’s material, subassembly and product procurements in 2024 were sourced internationally, of which approximately 79.9 % were sourced from seven suppliers.

For 2023 , approximately 16.0 % of the Company’s material, subassembly and product procurements were sourced internationally, of which approximately 94.8 % were sourced from twelve suppliers.

Approximately 15.2 % of the Company’s material, subassembly and product procurements in 2025 were sourced internationally, of which approximately 64.4 % were sourced from three suppliers.

For 2024 , approximately 17.0 % of the Company’s material, subassembly and product procurements were sourced internationally, of which approximately 79.9 % were sourced from seven suppliers.

Purchase orders denominated in U.S.

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The Company used observable market data assumptions (Level 1 inputs, as defined in accounting guidance) that it believes market participants would use in pricing its investment in FGF.

Effective September 14, 2022, the Company made an investment in Series B common membership interests of FG Financial Holdings, LLC (“FG Holdings LLC”), an entity related to the former chairman of the Company's Board of Directors.

Effective September 14, 2022, the Company exchanged its common shares held in FGF and received Series B common membership interests of FG Financial Holdings, LLC (“FG Holdings LLC”), an entity related to the former chairman of the Company's Board of Directors.

As further discussed in Note 7, the Company recorded the investment according to guidance provided by ASC 820 “Fair Value Measurement”, as the Company did not have a controlling financial interest in, nor exerted significant influence over the activities of FG Holdings LLC.

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On January 25, 2024, the Company redeemed its Series B common membership interests (the “Interests”) in FG Holdings LLC and withdrew from FG Holdings LLC.

In exchange for the Interests, the Company received 52,000 shares of the Company’s Common Stock, with an approximate fair value of $ 650 on the date of the transaction and recorded a realized loss of $ 91 on the investment during the first quarter of 2024.

The shares received by the Company are held as treasury stock, increasing the total number of treasury shares held by the Company to 342,080 .

The Company recognized operating income of $ 7.8 million during 2024 and an operating loss of $ 0.8 million during 2023 .

The Company’s 2023 operating results were negatively impacted by the worldwide shortages of materials, in particular semiconductors and integrated circuits, extended lead times, and increased costs and inventory levels for certain components due to supply chain disruptions in 2022 and early in 2023.

In exchange for the Interests, the Company received 52,000 shares of its own Common Stock that was held by FGF, with an approximate fair value of $ 650 on the date of the transaction and recorded a realized loss of $ 91 on the investment during the first quarter of 2024.

The shares received by the Company are held as treasury stock.

The Company recognized operating income of $ 15,987 during 2025 and $ 7,828 during 2024 .

On October 30, 2024, the Company’s wholly owned subsidiary, BK Technologies, Inc.

entered into a new Revolving Loan Commitment agreement with Fifth Third Bank, N.A., providing for a one -year revolving line of credit with a maximum commitment of $ 6,000 , with an accordion feature, if certain conditions are met, for up to an additional $ 4,000 of borrowing capacity, totaling a maximum commitment of $ 10,000 .

entered into a new revolving loan commitment agreement with Fifth Third Bank, N.A.

On October 30, 2025, BK Technologies, Inc., as the borrower, entered into an amendment to its revolving credit facility with Fifth Third Bank, National Association, as the lender (as amended, the “Fifth Third Credit Agreement”).

The Fifth Third Credit Agreement provides for a three -year revolving line of credit with a maximum commitment of $ 6,000 , with an accordion feature, if certain conditions are met, for up to an additional $ 8,000 of borrowing capacity, totaling a maximum commitment of $ 14,000 .

Each advance shall accrue interest on the outstanding principal amount thereof at a rate of SOFR plus a range of 1.75 % to 2.25 % per annum, based on certain total debt coverage ratios.

Each advance may be prepaid at any time without penalty and the entire line of credit commitment may be permanently terminated by BK Technologies, Inc.

at any time upon 10 days’ prior written notice to the lender without penalty.

There were no borrowings under the Fifth Third Credit Agreement as of December 31, 2025, and as of the date of filing this report.

On November 22, 2022, the Company’s wholly owned subsidiaries, BK Technologies, Inc.

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Summary of Significant Accounting Policies (Continued)

Reverse Stock Split

On March 23, 2023, the Board of Directors approved a one ( 1 )-for- five ( 5 ) reverse stock split (the “Reverse Stock Split”) of the Company’s issued and outstanding shares of the Company’s Common Stock, and on April 4, 2023, the Company filed with the Secretary of State of the State of Nevada a Certificate of Change to its Articles of Incorporation to effect the Reverse Stock Split.

The Company executed the Reverse Stock Split, which became effective at 5:00 p.m.

Eastern Time on April 21, 2023.

Shares of Common Stock underlying outstanding stock options and restricted stock units were proportionately reduced, and the respective exercise prices were proportionately increased in accordance with the terms of the agreements governing such securities.

Accordingly, all shares and per share amounts for all periods presented in the accompanying consolidated financial statements and notes thereto have been retroactively adjusted, where applicable, to reflect the Reverse Stock Split.

Advertising and Promotion Costs

2 unchanged sentences

For the years ended December 31, 2025 and 2024 , such expenses totaled $ 621 and $ 496 , respectively.

Engineering, Research and Development Costs

Included in SG&A expenses for the years ended December 31, 2024 and 2023 are engineering, research and development costs of $ 7,841 and $ 9,334 , respectively.

Share-Based Compensation

2 unchanged sentences

No compensation cost is recognized for equity instruments for which employees do not render the requisite service.

Restricted Stock Units

The Company recorded non-cash restricted stock unit compensation expense of $ 494 and $ 1,143 for the years ended December 31, 2024 and 2023 , respectively.

Earnings (Loss) Per Share

Earnings (loss) per share amounts are computed and presented for all periods in accordance with ASC 260 “Earnings per Share”.

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2024 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Summary of Significant Accounting Policies (Continued)

Comprehensive Income (loss)

Comprehensive income (loss) was equal to net income (loss) for the years ended December 31, 2024 and 2023 .

Earnings Per Share

Earnings per share amounts are computed and presented for all periods in accordance with ASC 260 “Earnings per Share”.

Product Warranty

6 unchanged sentences

The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

In November 2023, the FASB issued Accounting Standards Update (ASU) 2023 - 07 Segment Reporting (Topic 280 ):

Improvements to Reportable Segment Disclosures which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

The new standard became effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company evaluated the requirements for ASU 2023 - 07 and reported one reportable segment and included required disclosures.

Segment Reporting Disclosures

In December 2023, the FASB issued ASU 2023 - 09, Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures, which expands the disclosures required for income taxes.

This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

The amendment should be applied on a prospective basis while retrospective application is permitted.

The Company has adopted the ASU and has made the applicable disclosure, as required, in its Annual Report Form 10 -K for the year ended December 31, 2025.

The adoption of ASU 2023 - 09 did not have a material effect on our consolidated financial statements.

In November 2024, the FASB issued ASU 2024 - 03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220 - 40 ):

Disaggregation of Income Statement Expenses, an accounting standard update to improve income statement expenses disclosures.

The standard requires more detailed information related to the types of expenses, including (among other items) the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization included within each interim and annual income statement’s expense caption, as applicable.

This authoritative guidance can be applied prospectively or retrospectively and will be effective for fiscal years beginning after December 15, 2026, with early adoption permitted.

The Company does not expect the adoption of ASU 2024 - 03 to have a material effect on its consolidated financial statements.

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Summary of Significant Accounting Policies (Continued)

S egment Reporting Disclosures

The Company has one reportable segment - Land Mobile Radio (LMR) Products and Solutions.

The LMR segment provides radio devises that are hand-held (portable) or installed in vehicles (mobile) and operate on private radio systems that are P25 compliant.

The LMR segment provides radio devices that are hand-held (portable) or installed in vehicles (mobile) and operate on private radio systems that are P25 compliant.

The Company derives revenue primarily in North America and manages the business activities on a consolidated basis.

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The measure of segment assets is reported on the balance sheet as total consolidated assets.

The chief operating decision maker uses operating income (loss) and net income (loss) to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the LMR segment or into other parts of the entity, the development of public safety applications utilizing cellular technology or for acquisitions.

Net income (loss) is used to monitor budget versus actual results.

The chief operating decision maker also uses net income (loss) in competitive analysis by benchmarking to the Company’s competitors.

The chief operating decision maker uses operating income and net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the LMR segment or into other parts of the entity, the development of public safety applications utilizing cellular technology or for acquisitions.

Net income is used to monitor budget versus actual results.

The chief operating decision maker also uses net income in competitive analysis by benchmarking to the Company’s competitors.

The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segment and in establishing management’s compensation.

The table below summarizes the significant categories regularly reviewed by the CODM for the years ended December 31, 2024, and 2023:

The table below summarizes the significant categories regularly reviewed by the chief operating decision maker for the years ended December 31, 2025, and 2024:

$ 86,139 $ 76,592

7 unchanged sentences

26,040 21,222

Operating income (loss)

7,828 ( 777 )

Other (expense) income (a)

( 362 ) ( 659 )

Operating income

Other income (expense) (a)

Income tax (expense) benefit

Segment net income (loss)

( 2,581 ) 984

Segment net income

$ 13,536 $ 8,450

Reconciliation of profit or loss

1 unchanged sentence

Loss on investments

( 91 ) ( 740 )

Consolidated net income (loss)

Consolidated net income

$ 13,536 $ 8,359

(a) Other segment items included interest expense and foreign currency exchange gains/(losses)

(a) Other segment items included interest income (expense) and foreign currency exchange gains/(losses)

BK TECHNOLOGIES CORPORATION

YEARS ENDED DECEMBER 31, 2024 AND 2023

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Summary of Significant Accounting Policies (Continued)

Revision of Previously Issued Financial Statements

Certain immaterial revisions have been made to the 2024 consolidated statement of cash flows.

Specifically, there was an increase in net cash provided by operating activities related to capitalized software and system integration costs, which was fully offset by an increase in cash flows used in investing activities related to the same item.

The changes were presentation only and had no impact on previously reported net income, total assets, total liabilities, stockholders’ equity or net change in cash and cash equivalents.

Reclassifications

Certain reclassifications have been made to the 2024 consolidated financial statements to conform to the 2025 consolidated financial statement presentation.

These reclassifications had no effect on net income reported for the year ended December 31, 2024.

Inventories, net

5 unchanged sentences

16,997 19,330

Inventory reserve

( 1,135 ) ( 1,694 )

$ 15,862 $ 17,636

Changes in the allowance for slow-moving, excess, and obsolete inventory are as follows:

4 unchanged sentences

Disposal of inventory

( 1,449 ) ( 511 )

Balance, end of year

$ 1,135 $ 1,694

During the year ended December 31, 2024, the Company wrote off $ 511 of inventory that had been fully allowed for previously, which had no impact to the Company's consolidated balance sheets or consolidated statements of operations.

During the year ended December 31, 2025 and 2024, the Company wrote off $ 1,449 and $ 511 , respectively, of inventory that had been fully allowed for previously, which had no impact to the Company's consolidated balance sheets or consolidated statements of operations.

Allowance for Credit Losses

4 unchanged sentences

Uncollectible accounts written off

( 59 ) ( 122 )

Balance, end of year

16 unchanged sentences

(in thousands, except share data and percentages)

Capitalized Product Development Costs

The Company accounts for the costs of Land Mobile Radio (LMR) multi-band development within its products in accordance with ASC Topic 350 - 30, “ Intangibles – Goodwill and Other,” under which certain LMR multi-band radio development costs incurred subsequent to the establishment of technological feasibility are capitalized and amortized over the estimated lives of the related products.

Capitalized Software and Systems Integration Costs

The Company accounts for the costs of Land Mobile Radio (LMR) multi-band development within its products in accordance with ASC Topic 350 - 30, “ Intangibles – Goodwill and Other,” under which certain LMR multi-band radio software and systems integration costs incurred subsequent to the establishment of technological feasibility are capitalized and amortized over the estimated lives of the related products.

The Company determined technological feasibility was established for multi-band LMR radio products by the introduction of the BKR 9000 multi-band portable product to the market in June 2023, as specified by Topic 350 - 30.

Upon the general release of the LMR multi-band mobile radio product currently in development to customers, development costs for that product will be amortized over periods not exceeding ten years, based on future revenue of the product.

Capitalized product development costs were $ 1,321 as of December 31, 2024.

Upon the general release of the LMR multi-band mobile radio product currently in development to customers, software and systems integration costs for that product will be amortized over periods not exceeding ten years, based on future revenue of the product.

Capitalized software and systems integration costs were $ 2,096 and $ 1,321 during the years ended December 31, 2025 and 2024, respectively.

Credit Facilities

On October 30, 2024, BK Technologies, Inc., a wholly owned subsidiary of the Company, as the borrower, entered into a new credit facility with Fifth Third Bank, National Association, as the lender (the “Fifth Third Revolving Loan Commitment”).

The Fifth Third Revolving Loan Commitment provides for a one -year revolving line of credit with a maximum commitment of $ 6,000 , with an accordion feature, if certain conditions are met, for up to an additional $ 4,000 of borrowing capacity, totaling a maximum commitment of $ 10,000 .

Each advance shall accrue interest on the outstanding principal amount thereof at a rate of SOFR plus 2.5 % per annum.

On October 30, 2024, the Company’s wholly owned subsidiary, BK Technologies, Inc.

entered into a new revolving loan commitment agreement with Fifth Third Bank, N.A.

Each advance shall accrue interest on the outstanding principal amount thereof at a rate of SOFR plus a range of 1.75 % to 2.25 % per annum, based on certain total debt coverage ratios.

Each advance may be prepaid at any time without penalty and the entire line of credit commitment may be permanently terminated by BK Technologies, Inc.

at any time upon 10 days’ prior written notice to the lender without penalty.

BK Technologies, Inc.’s repayment obligations under the credit facility are guaranteed by the Company and RELM Communications, Inc.

and secured by a pledge of essentially all of the assets of BK Technologies, Inc., the Company and RELM Communications, Inc.

(collectively, the “Loan Parties”).

The Loan Parties are subject to customary negative covenants, including with respect to their ability to incur additional indebtedness, encumber and dispose of their assets and enter into affiliate transactions.

There were no borrowings under the Fifth Third Credit Agreement as of December 31, 2025.

BK Technologies, Inc.’s repayment obligations under the credit facility are guaranteed by the Company and secured by a pledge of essentially all of the assets of BK Technologies, Inc., and the Company.

BK Technologies Inc.

must also comply with a maximum total funded debt ratio of 2.00 to 1.00 and a minimum fixed charge coverage ratio of 1.20 to 1.00, each measured at the end of every fiscal quarter.

As of December 31, 2024, the Company was in compliance with the debt covenants and there was no outstanding borrowing balance.

and the Company are subject to customary negative covenants, including with respect to their ability to incur additional indebtedness, encumber and dispose of their assets and enter into affiliate transactions.

As of December 31, 2025, the Company believes that it was in compliance with the debt covenants and there was no outstanding borrowing balance.

On November 22, 2022, the Subsidiaries entered into the IPSA with Alterna.

2 unchanged sentences

The Line of Credit bore an interest rate of Prime plus 1.85 %.

Interest and related servicing fees for years ended December 31, 2024 and 2023 , were approximately $ 356 and $ 648 , respectively.

Interest and related servicing fees for the year ended December 31, 2024, was approximately $ 356 .

Under the arrangement, the Company could transfer eligible short-term trade receivables to the conduit, with full recourse, on a daily basis in exchange for cash.

1 unchanged sentence

The Company accounted for the transfers of receivables as a secured borrowing due to the Company’s continuing involvement with the accounts receivable.

During 2024 and 2023 , the Company transferred receivables having an aggregate face value of $ 49,700 and $ 67,400 , respectively, to the conduit and received proceeds of $ 46,400 and $ 74,600 , respectively, which also includes draws on available inventory funding.

There were no losses incurred on these transfers during 2024 and 2023 , respectively.

During the year ended December 31, 2024 , the Company transferred receivables having an aggregate face value of $ 49,700 , to the conduit and received proceeds of $ 46,400 , which also includes draws on available inventory funding.

There were no losses incurred on these transfers during the year ended December 31, 2024 .

The Company terminated the IPSA in October 2024 upon entering into the credit facility with Fifth Third Bank.

Notes Payable

On April 6, 2021, BK Technologies, Inc., a wholly owned subsidiary of the Company, and JP Morgan Chase Bank, N.A., as a lender, entered into a Master Loan Agreement in the amount of $ 743 to finance various items of manufacturing equipment (the “JPMC Credit Agreement”).

The Company used funds obtained from the Line of Credit to replace the JPMC Credit Agreement.

This note payable was paid in full on June 27, 2023.

On September 25, 2019, BK Technologies, Inc., a wholly owned subsidiary of the Company, and U.S.

9 unchanged sentences

On January 25, 2024, the Company redeemed its Series B common membership interests (the “Interests”) in FG Holdings LLC and withdrew from FG Holdings LLC.

In exchange for its Interests, the Company received 52,000 shares of the Company’s Common Stock, with an approximate fair value of $ 650 on the date of the transaction and recorded a realized loss of $ 91 on the investment during the first quarter of 2024.

The shares received by the Company are held as treasury stock, increasing the total number of treasury shares held by the Company to 342,080 .

In exchange for its Interests, the Company received 52,000 shares of its own Common Stock that was held by FGF, with an approximate fair value of $ 650 on the date of the transaction and recorded a realized loss of $ 91 on the investment during the first quarter of 2024.

The shares received by the Company are held as treasury stock.

The investment in the Series B common membership interests of FG Holdings LLC was measured using the NAV practical expedient in accordance with ASC 820 Fair Value Measurement and has not been classified within the fair value hierarchy.

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Kyle Cerminara, who served as a director of the Company and chairman of the Board of Directors until December 14, 2023, was Chief Executive Officer, Co-Founder, and Partner of FG and served as chairman of the board of directors of FG Group Holdings Inc., the entity that was a majority Series B member in FG Holdings ILC.

Cerminara also serveds as a manager of FG Holdings, LLC and chairman of the board of directors of FGF.

During the year ended December 31, 2024 and 2023 , the Company recognized a realized loss of approximately $ 91 and an unrealized loss of approximately $ 740 due to changes on investments, respectively.

The Company accounts for its leasing arrangements in accordance with Topic 842, “Leases”.

Cerminara also served as a manager of FG Holdings, LLC and chairman of the board of directors of FGF.

During the year ended December 31, 2024, the Company recognized a realized loss of approximately $ 91 .

The Company accounts for its leasing arrangements in accordance with ASC Topic 842, “Leases”.

The Company leases manufacturing and office facilities and equipment under operating leases and determines if an arrangement is a lease at inception.

8 unchanged sentences

Rental, maintenance and tax expenses for this facility were approximately $ 677 and $ 625 in 2025 and 2024 , respectively.

In February 2026, we entered into a new lease relating to this property, pursuant to which we will lease approximately 31,500 square feet ( not in thousands) of industrial space at 7100 Technology Drive in West Melbourne, Florida.

The lease will commence in February 2027, has a term of 125 months, and includes two five year renewal options.

In February 2020, the Company entered into a lease for 6,857 square feet ( not in thousands) of office space at Sawgrass Technology Park, 1619 NW 136th Avenue in Sunrise, Florida, for a period of 64 months commencing July 1, 2020.

The Company executed a lease extension agreement on September 24, 2025, that extended existing terms until an additional 1,514 square feet ( not in thousands) of expansion premises is available for occupation by the Company.

At the date that the expansion premises are available for occupancy, the Company will begin a new lease extension period for an additional sixty-two ( 62 ) month term, for approximately 8,371 total square feet ( not in thousands).

The lease extension includes two ( 2 ) additional five ( 5 ) year renewal options, at the sole discretion of the Company.

The lease liability and right-of-use asset as of December 31, 2025, include payments for renewal periods that are reasonably certain to be exercised, in accordance with ASC 842.

Annual rental, maintenance and tax expenses for the facility were approximately $ 225 and $ 224 in 2025 and 2024 , respectively.

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Total liability

The components of income before provision for income taxes are as follows:

Years Ended December 31,

Income before income taxes

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due.

Deferred taxes relate to differences between the basis of assets and liabilities for financial and income tax reporting which will be either taxable or deductible when the assets or liabilities are recovered or settled.

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Income Taxes (Continued)

The income tax expense (benefit) is summarized as follows:

1 unchanged sentence

1,377 ( 1,581 )

A reconciliation of the statutory U.S.

income tax rate to the effective income tax rate follows:

Years Ended December 31,

181 ( 1,091 )

1,558 ( 2,672 )

$ 2,581 $ ( 984 )

Beginning in 2025 annual reporting, we adopted ASU 2023 - 09 prospectively.

See Note 1 - Summary of Significant Accounting Policies - Recently Adopted Accounting Pronouncements for additional details on the adoption of ASU 2023 - 09.

A reconciliation of the U.S.

federal statutory income tax rate to our effective tax rate pursuant to the disclosure requirements of ASU 2023 - 09 for the year ended December 31, 2025 is as follows:

Year Ended December 31, 2025

federal statutory income tax rate

3,385 21.00 %

State and local income taxes 1 , net of federal income tax effect

Research and development tax credits

( 157 ) -0.98 %

Nontaxable or nondeductible items

Share-based Compensation

( 338 ) -2.10 %

Changes in unrecognized tax benefits

( 1,419 ) -8.80 %

Other adjustments

Deferred only - Stock based compensation

Deferred only - Section 174

( 183 ) -1.13 %

Effective tax rate

2,581 15.67 %

1 California and Florida account for greater than 50% of the tax effect in this category.

A reconciliation of the U.S.

federal statutory income tax rates to our effective tax rate for the year ended December 31, 2024 is as follows:

Year Ended December 31,

Statutory U.S.

income tax rate

21.00 % 21.00 %

State taxes, net of federal benefit

9.42 % ( 1.34 )%

Permanent differences

0.84 % ( 0.87 )%

Change in valuation allowance

( 48.79 )% ( 48.01 )%

Change in tax credits

( 4.59 )% 16.59 %

Uncertain tax position

Impact from rate changes

( 10.48 )% 10.14 %

Effective income tax rate

( 13.35 )% ( 2.49 )%

Cash paid for income taxes, net of refunds received, by jurisdiction pursuant to the disclosure requirements of ASU 2023 - 09 for the year ended December 31, 2025 is as follows:

Year Ended December 31,

Cash paid for income taxes, net of refunds received

BK TECHNOLOGIES CORPORATION

6 unchanged sentences

Deferred tax assets:

Operating loss carryforwards

R&D Tax Credits

Section 263A costs

Additional K-1 temporary adjustment

Capitalized research and development expenses

Net ROU asset and lease liability

Unrealized loss

$ 1,877 $ 300

Capitalized software and systems integration costs

Lease Liability

Capital loss Carryforward

Asset reserves:

Inventory allowance

State depreciation

Accrued expenses:

Non-qualified stock options

Nonqualified Stock Options

Deferred warranty revenue

Net operating losses

Deferred Tax Assets

Less valuation allowance

Valuation allowance

( 826 ) ( 802 )

2 unchanged sentences

( 414 ) ( 301 )

Capitalized software and systems integration costs

( 640 ) ( 681 )

Total deferred tax liabilities

( 1,329 ) ( 982 )

Net deferred tax assets

Total Deferred Tax Assets/(Liabilities)

$ 5,230 $ 6,788

As of December 31, 2025, the Company had deferred tax assets of approximately $ 6,559 offset by deferred tax liabilities of $ 1,329 .

This asset is primarily composed of capitalization of research and development expenses and deferred revenue.

This asset is primarily composed of capitalization of research and development expenses, stock compensation, and deferred revenue.

The liability is composed of the effect of differences in amortization and depreciation utilized for tax purposes.

During 2024, the Company utilized $ 7,915 of federal NOLs and during 2023 the Company utilized $ 4,911 of federal NOLs.

During 2025 and 2024, the Company utilized $ 0 and $ 7,915 of federal NOLs, respectively.

The deferred tax asset amounts are based upon management’s conclusions regarding, among other considerations, the Company’s current and anticipated customer base, contracts, and product introductions, certain tax planning strategies, and management’s estimates of future earnings based on information currently available, as well as recent operating results during 2025, 2024, and 2023.

1 unchanged sentence

Based on the analysis of all available evidence, both positive and negative, the Company has concluded that, except for the capital loss carryforward of approximately $ 851 , it currently does have the ability to generate sufficient taxable income in the necessary period to utilize the benefits for the deferred tax assets.

Accordingly, the Company recorded a decrease in the valuation allowance of $ 3,596 as of December 31, 2024.

Accordingly, the Company recorded an increase in the valuation allowance of $ 24 as of December 31, 2025.

The Company cannot presently estimate what, if any, changes to the valuation of its deferred tax assets may be deemed appropriate in the future.

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A reconciliation of the beginning and ending amount of our unrecognized tax benefits is as follows:

Balance at January 1

Additions based on tax positions related to the current year

Additions for tax positions of prior years

Years Ended December 31,

Unrecognized tax benefits as of January 1

(Decreases) increases related to prior year tax positions

( 1,419 ) 1,265

Increases related to current year tax positions

Decreases related to settlements of prior year tax positions

Decreases related to lapses of statute of limitations

Balance at December 31,

As of December 31, 2025, the Company recorded approximately $ 0 of unrecognized tax benefits, a net decrease of $ 1,419 from $ 1,419 as of December 31, 2024.

The Company completed an updated R&D credit study, which provided sufficient support for the underlying R&D credit positions.

As a result, the prior‑year unrecognized tax benefit is no longer required, and the ending balance as of 12/31/2025 is $ 0 .

As of December 31, 2024, the Company recorded approximately $ 1,419 of unrecognized tax benefits, a net increase of $ 1,419 from $ 0 as of December 31, 2023.

If the Company recognized its tax positions, approximately $ 1,419 would favorably impact the tax rate.

If the Company recognized its tax positions, approximately $ 1,419 would favorably impact the tax rate in 2024.

Penalties and tax-related interest expense, of which there were no material amounts for the years ended December 31, 2025 , and 2024 , are reported as a component of income tax expense (benefit).

5 unchanged sentences

The calendar years 2022 through 2024 are still open to IRS examination under the statute of limitations.

The last IRS examination on the Company’s 2007 calendar year was closed with no change.

Income (Loss) Per Share

The following table sets forth the computation of basic and diluted loss per share:

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

The Company does not anticipate the bill will have a material impact on the financial statements.

Under OBBBA, the Company is permitted to claim 100% bonus depreciation and fully deduct domestic research expenditures under Section 174A.

These provisions accelerate tax deductions but do not create permanent tax differences;

therefore, the impact is timing‑related only and does not materially affect the Company’s 2025 income tax provision.

Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share:

Years Ended December 31,

Net income (loss) from continuing operations numerator for basic and diluted earnings per share

Net income for basic and diluted earnings per share

$ 13,536 $ 8,359

Denominator for basic income (loss) per share weighted average shares

Denominator for basic earnings per share weighted average shares

3,672,239 3,553,303

1 unchanged sentence

Options, restricted stock units, and warrants

Denominator for diluted income (loss) per share weighted average shares

264,575 157,341

Basic income (loss) per share

Denominator for diluted earnings per share weighted average shares

3,936,814 3,710,644

Diluted income (loss) per share

Basic earnings per share

$ 3.69 $ 2.35

Approximately 202,600 stock options and 19,587 restricted stock units for the year ended December 31, 2023 were excluded from the calculation because they were anti-dilutive ( none for the year ended December 31, 2024).

Share-Based Compensation

Diluted earnings per share

$ 3.44 $ 2.25

Approximately 1,955 stock options and 0 restricted stock units for the year ended December 31, 2025 were excluded from the calculation because they were anti-dilutive.

For the year ended December 31, 2024, no stock options and restrictive stock options were excluded.

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Non-Cash Share-Based Compensation

The Company’s stockholders approved the BK Technologies Corporation 2025 Incentive Compensation Plan (the “2025 Plan”) at the 2025 Annual Meeting of Stockholders of the Company (the “Annual Meeting”) held on June 18, 2025.

The 2025 Plan was previously approved by the Company’s Board of Directors (the “Board”).

The 2025 Plan replaces the 2017 Incentive Compensation Plan (the “Prior Plan”).

No new awards will be granted under the Prior Plan after the date of the Annual Meeting.

However, all awards granted under the Prior Plan that were outstanding on the date of the Annual Meeting will remain outstanding in accordance with their terms.

The 2025 Plan authorizes the grant of equity-based and cash-based compensation awards to officers, directors, and employees of, and consultants to, the Company and its subsidiaries.

Awards under the 2025 Plan may be granted in the form of stock options, stock appreciation rights, restricted shares, restricted share units, other share-based awards, and cash-based awards.

There are 500,000 shares of the Company’s common stock reserved for issuance under the 2025 Plan.

No awards may be granted under the 2025 Plan after March 11, 2035.

The stockholders of the Company also approved the BK Technologies Corporation Employee Stock Purchase Plan (the “ESPP”) at the Annual Meeting held on June 18, 2025.

The ESPP was previously approved by the Board.

The objective of the ESPP is to offer eligible employees of the Company and its designated subsidiaries the ability to purchase shares of the Company’s common stock at a discount, subject to various limitations under the ESPP.

There are 150,000 shares of the Company’s common stock authorized for issuance under the ESPP.

As of December 31, 2025, the Company issued 2,892 shares of common stock from its treasury share account pursuant to the ESPP

Stock Options

17 unchanged sentences

Estimated Forfeitures

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2024 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Share-Based Compensation (Continued)

A summary of stock option activity under the Company’s equity compensation plans as of December 31, 2025 , and changes during the year ended December 31, 2025 , are presented below:

9 unchanged sentences

11,070 19.90 — 19.39 262,663

4,380 14.72 — 14.72

As of December 31, 2025

2 unchanged sentences

331,877 30.55 30.55 8.78 14,615,882

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Share-Based Compensation (Continued)

Range of Exercise Prices

4 unchanged sentences

41.16 55.97 180,166 43.42 9.52

55.98 70.78 1,000 70.78 9.66

460,643 27.08 8.08

Range of Exercise Prices

9 unchanged sentences

The Company estimates the fair value of the restricted stock unit awards based upon the market price of the underlying common stock on the date of grant.

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2024 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Share-Based Compensation (Continued)

A summary of non-vested restricted stock units under the Company’s non-employee director share-based incentive compensation plan is as follows:

10 unchanged sentences

41,189 $ 16.97

Weighted Average

Year ended December 31, 2023

Number of Shares

Price per Share

Unvested at January 1, 2023

41,129 $ 13.20

45,412 $ 12.37

Vested and issued

( 66,954 ) $ 12.63

Cancelled/forfeited

Unvested at December 31, 2023

19,587 $ 13.22

During the year ended December 31, 2024 and 2023 , the Company also issued 8,960 RSUs under a consulting agreement for advisory services to the Board of Directors.

The principal of the consulting firm was elected as the Chairman of the Board of Directors in December 2023.

During 2024 and 2023, the Company’s Board of Directors approved the Executive Salary Swap Plan to prospectively swap a portion of certain executive’s salaries for a 12 month period ( 10 % minimum, up to 50 %) otherwise payable in cash for a grant of RSUs (with each RSU representing a contingent right to receive one share of the Company’s Common Stock) at a fixed rate of $ 10 per share, rounded down to the nearest whole RSU.

During 2024, the Company’s Board of Directors approved the Executive Salary Swap Plan to prospectively swap a portion of certain executive’s salaries for a 12 month period ( 5 % minimum, up to 25 %) otherwise payable in cash for a grant of RSUs (with each RSU representing a contingent right to receive one share of the Company’s Common Stock) at a fixed rate of $ 12 per share, rounded down to the nearest whole RSU.

The Restricted Stock Units vested at the date of the grant.

The Company issued 13,979 and 6,739 RSUs under this arrangement during December 31, 2024 and 2023, respectively.

The Company issued 2,882 and 3,764 RSUs under this arrangement for the year ended December 31, 2025, and 2024.

During 2023, the Company’s Board of Directors approved the Executive Salary Swap Plan to prospectively swap a portion of certain executive’s salaries for a 12 month period ( 10 % minimum, up to 50 %) otherwise payable in cash for a grant of RSUs (with each RSU representing a contingent right to receive one share of the Company’s Common Stock) at a fixed rate of $ 10 per share, rounded down to the nearest whole RSU.

The Restricted Stock Units vested at the date of the grant.

The Company did not issue RSUs under this arrangement for the year ended December 31, 2025 and issued 13,979 RSUs under this arrangement for the period ended December 31, 2024.

As of December 31, 2025 and 2024 , there was approximately $ 5,900 and $ 1,419 , respectively, of total unrecognized compensation cost related to non-vested share-based compensation arrangements, including stock options and restricted stock units.

This compensation cost is expected to be recognized approximately over one to four years.

Other Equity Transactions

On January 25, 2024, the Company redeemed its "Interests" of FG Holdings LLC and withdrew from FG Holdings LLC.

The shares received by the Company are held as treasury stock, increasing the total number of treasury shares held by the Company to 342,080 .

On November 6, 2023, the Company entered into a Master Supply Agreement (the “MSA”) and Transition Services Agreement (the “TSA,” and together with the MSA, the “Agreements”) with East West Manufacturing, LLC, a Georgia limited liability company (“East West”).

Pursuant to the Agreements, the Company transitioned its West Melbourne, Florida manufacturing activities to East West’s facilities, and East West became the exclusive third -party manufacturer of the Company’s radio product line under a three -year arrangement.

In connection with the Agreements, the Company and East West entered into a Stock Purchase Agreement (the “SPA”), pursuant to which East West purchased 77,520 shares of the Company’s common stock with a value equal to $ 1,000 .

The number of shares of common stock was determined based upon a price per share of $ 12.90 , which is equal to the average of the closing price of the Company's common stock on the NYSE American exchange for the 30 most recent trading days prior to November 6, 2023, rounded up to the nearest whole number of shares.

Additionally, East West purchased a warrant (“Warrant”), with a five -year term to purchase up to 135,300 shares of the Company’s common stock at an exercise price per share of $ 15.00 .

The consideration for the Warrant was payment equal to (a) $ 1,000 minus (b) (i) the amount of any outstanding accounts payable by the Company to East West and (ii) the amount of any excess or obsolete inventory of the Company held by East West (solely to the extent not otherwise taken into account pursuant to the MSA or any other agreement between the Company and East West).

The payment consisted of a $ 950 reduction in accounts payable and $ 50 in cash.

The common stock, the Warrant and the shares issuable upon exercise of the Warrant were deemed to be issued to an accredited investor in a private placement exempt from the registration pursuant to Section 4 (a)( 2 ) of the Securities Act of 1933, as amended (“Securities Act”).

The Company’s reliance upon Section 4 (a)( 2 ) of the Securities Act was based in part upon the following factors:

(a) the issuance of the securities was in connection with isolated private transactions which did not involve any public offering;

(b) there were a limited number of offerees;

(c) there will be no subsequent or contemporaneous public offerings of the Warrant or the shares underlying the Warrant by the Company;

and (d) the negotiations for the sale of the securities took place directly between East West and the Company.

This compensation cost is expected to be recognized approximately over one to 2.6 years.

BK TECHNOLOGIES CORPORATION

2 unchanged sentences

(in thousands, except share data and percentages)

Other Equity Transactions (Continued)

The Warrant issued to East West was classified as a component of permanent equity in the Company's Consolidated Balance Sheets as it is a freestanding financial instrument that is immediately exercisable, does not embody an obligation for the Company to repurchase its own shares and permits the holders to receive a fixed number of shares of common stock upon exercise.

For year ended 2023, all of the shares underlying the Warrant had not been included in the weighted-average number of shares of common stock used to calculate net loss per share, basic and diluted, attributable to common stockholders because the shares would have been anti-dilutive.

Other Equity Transactions

On January 25, 2024, the Company redeemed its "Interests" of FG Holdings LLC and withdrew from FG Holdings LLC.

The shares received by the Company are held as treasury stock.

On November 6, 2023, the Company entered into a Master Supply Agreement (the "MSA") and Transition Services Agreement (the "TSA," and together with the MSA, the "Agreements") with East West Manufacturing, LLC, a Georgia limited liability company ("East West").

Pursuant to the Agreements, the Company issued a warrant to East West with a five -year term to purchase up to 135,300 shares of the Company's common stock at an exercise price per share of $ 15.00 .

The warrant was classified as a component of permanent equity in the Company's Consolidated Balance Sheets as it was a freestanding financial instrument that was immediately exercisable, did not embody an obligation for the Company to repurchase its own shares and permitted the holders to receive a fixed number of shares of common stock upon exercise.

In May 2025, East West exercised its warrant in full.

The Company used the Black-Scholes-Merton option valuation model to calculate the fair value of a stock warrant grant, using the assumptions noted in the following table.

10 unchanged sentences

Sales to the U.S.

Government represented approximately 38 % and 49 % of the Company’s total sales for the years ended December 31, 2024 and 2023 respectively.

These sales were primarily to the various government agencies, including those within the United States Department of Defense, the United States Forest Service, the United States Department of Interior, and the United States Department of Homeland Security.

In addition, one commercial customer accounted for approximately 13 % of net sales for the year ended December 31, 2024 and approximately 24 % of accounts receivable at December 31, 2024.

Another commercial customer accounted for approximately 15 % of accounts receivable at December 31, 2024.

There were no commercial customers accounting for more than 10% of net sales for the year ended December 31, 2023.

One commercial customer accounted for approximately 16 % of accounts receivable at December 31, 2023.

Government were primarily to various government agencies, including those within the United States Department of Defense ("DoD"), the United States Forest Service ("USFS"), the United States Department of Interior ("DoI"), and the United States Department of Homeland Security ("DHS").

The following table summarizes customer concentration of net revenues:

Revenue as a percent of total revenue

United States government agencies

* Less than 10% of total revenues.

The following table summarizes customer concentration of receivables

Receivables as a percent of total receivables

United States government agencies

* Less than 10% of total receivables.

December 31, 2025 there were

no commercial customers accounting for more than

10% of total receivables

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Retirement Plan

14 unchanged sentences

Purchase Commitments

The Company has purchase commitments for inventory totaling $ 9,324 as of December 31, 2024 .

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2024 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

The Company has purchase commitments for inventory totaling $ 11,159 as of December 31, 2025, which are expected to be satisfied over the following 3 months.

Self-Insured Health Benefits

10 unchanged sentences

From time to time the Company may be involved in various claims and legal actions arising in the ordinary course of its business.

There were no pending material claims or legal matters as of December 31, 2024 .

The Company assesses its liabilities and contingencies in connection with outstanding legal proceedings utilizing the latest information available.

Where it is probable that the Company will incur a loss and the amount of the loss can be reasonably estimated, the Company records a liability in its consolidated financial statements.

These legal accruals may be increased or decreased to reflect any relevant developments on a quarterly basis.

Where a loss is not probable or the amount of the loss is not estimable, the Company does not record an accrual, consistent with applicable accounting guidance.

In the opinion of management, while the outcome of such claims and disputes cannot be predicted with certainty, the Company’s ultimate liability in connection with these matters is not expected to have a material adverse effect on the Company’s results of operations, financial position or cash flows, and the amounts accrued for any individual matter are not material.

However, legal proceedings are inherently uncertain.

As a result, the outcome of a particular matter or a combination of matters may be material to the Company’s results of operations for a particular period, depending upon the size of the loss or the Company’s income for that particular period.

On February 3, 2026, the Company filed a complaint with the United States District Court for the Eastern District of Texas, alleging patent infringement against AT&T Mobility LLC and AT&T Services, Inc.

(collectively, “AT&T”) and requesting monetary and injunctive relief.

AT&T has not responded to the Company’s complaint, as of the date of this filing.

Geopolitical Tensions

1 unchanged sentence

Although the length and impact of the ongoing military conflicts is highly unpredictable, the conflict in both of these regions could lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions.

BK TECHNOLOGIES CORPORATION

DECEMBER 31, 2025 AND

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data and percentages)

Capital Programs

On December 17, 2021 a share repurchase program was authorized under which the Company may repurchase up to an aggregate of $ 5,000 of its common shares.

Share repurchases under this program were authorized to begin immediately.

Repurchases may be made through a variety of methods, which could include open market purchases, accelerated share repurchase transactions, negotiated block transactions, Rule 10b5 - 1 plans, other transactions that may be structured through investment banking institutions or privately negotiated, or a combination of the foregoing.

The program does not have an expiration date.

2 unchanged sentences

The authorization of the share repurchase program does not require the Company to acquire any particular number of shares and repurchases may be suspended or terminated at any time at the Company’s discretion.

As of December 31, 2024 , the Company has completed no share repurchases under this program.

The Company announced the suspension of its quarterly cash dividend program in March 2023.

As of December 31, 2025 , the Company has completed 19,135 share repurchases under this program.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data