Boxlight Corp 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Index to Financial Statements Page Report of Independent Registered Public Accounting Firm (PCAOB ID -677) F-1 Consolidated Balance Sheets as of December 31, 2025 and 2024 F-4 Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2025 and 2024 F-5 Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the years ended December 31, 2025 and 2024 F-6 Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024 F-8 Notes to Consolidated Financial Statements F-9 58 T able of Cont ents Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders Boxlight Corporation Atlanta, Georgia Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheet of Boxlight Corporation and Subsidiaries (the “Company”) as of December 31, 2025, and the related consolidated statement of operations and comprehensive loss, stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively, referred to as the “consolidated financial statements”). In our opinion, the consolidated 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 then ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. S ubstantial Doubt about the Company’s Ability to Continue as a Going Concern The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses and negative cash flows from operations, and may be unable to maintain compliance with financial covenants required by its credit agreement that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. 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 the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated 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. 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. 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. We believe our audit provides a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the consolidated 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 consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements taken as a F-1 T able of Cont ents whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Valuation of Inventory Critical Audit Matter Description As disclosed in Notes 1 and 3 to the consolidated financial statements, the Company’s net inventory totaled approximately $34.5 million as of December 31, 2025. Inventory is stated at the lower of cost or net realizable value and consists of spare parts and finished goods. Inventory values are primarily determined using specific identification and the first-in, first-out (FIFO) cost methods. Such costs include the direct cost from the Current Manufacturer (CM) or Original Equipment Manufacturer (OEM), plus material overhead related to the purchase, inbound freight and import duty costs. The Company establishes reserves based on a review of several quantitative and qualitative factors, including current pricing levels, and the anticipated need for subsequent markdowns, aging of inventories, historical sales trends, and the impact of market trends and economic conditions. The principal considerations for our determination that performing procedures relating to the accounting for the valuation of inventory is a critical audit matter are: (i) the significant judgment by management in developing estimates for determining inventory write-downs for lower of cost or net realizable value and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence related to the accuracy and valuation of inventory. How the Critical Audit Matter Was Addressed in the Audit Our principal audit procedures performed to address this critical audit matter included the following: • We obtained an understanding of the internal controls and processes in place related to the valuation of inventory. • We tested the accuracy of the cost of inventory items, on a sample basis, by obtaining and inspecting third party invoices and other supporting documents. • We evaluated the appropriateness of management’s analysis used to estimate the reserve for slow‑moving inventory, excess, and obsolete inventory including testing the completeness and accuracy of the underlying data used in the analysis. • We tested a sample of inventory for lower of cost or net realizable value. • We evaluated the reasonableness of the significant assumptions used by management related to annual inventory movement. /s/ Cherry Bekaert LLP We have served as the Company’s auditor since 2025. Atlanta, Georgia April 15, 2026 F-2 T able of Cont ents Report of Independent Registered Public Accounting Firm To the Stockholders, Board of Directors, and Audit Committee of Boxlight Corporation Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheet of Boxlight Corporation (the “Company”) as of December 31, 2024, the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity, and cash flows for the year ended December 31, 2024, and the related notes (collectively referred to as 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, 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 have also audited the adjustments to the 2024 financial statements to retrospectively apply the changes in the reporting of the Company’s December 2025 reverse stock split discussed in Note 1 to the financial statements. In our opinion, such adjustments are appropriate and have been properly applied. Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 1 to the financial statements, the Company has identified certain conditions relating to its outstanding debt and Series B and C Preferred Stock that are outside the control of the Company. In addition, the Company has generated recent losses. These factors, among others, raise substantial doubt regarding the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1 to the accompanying financial statements. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion 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. 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 the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. 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. 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. 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 include 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. /s/ Forvis Mazars, LLP We served as the Company’s auditor from 2018 to 2025. Atlanta, Georgia March 28, 2025 (except as to the changes in the reporting of the Company’s December 2025 reverse stock split discussed in Note 1, as to which the date is April 15, 2026) F-3 T able of Cont ents Boxlight Corporation Consolidated Balance Sheets As of December 31, 2025 and 2024 (in thousands except share and per share amounts) December 31, 2025 December 31, 2024 ASSETS Current assets: Cash and cash equivalents $ 9,370 $ 8,007 Accounts receivable – trade, net of allowances of $ 1,055 and $ 394 , respectively 15,358 18,325 Inventories, net of reserves 38,126 43,265 Prepaid expenses and other current assets 6,624 8,785 Total current assets 69,478 78,382 Property and equipment, net of accumulated depreciation 1,770 2,134 Operating lease right of use asset 7,009 8,055 Intangible assets, net of accumulated amortization 17,080 25,944 Deferred tax assets, net 1,472 — Other assets 734 790 Total assets $ 97,543 $ 115,305 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable and accrued expenses $ 22,786 $ 24,176 Accounts payable and accrued expenses - related party 3,699 — Short-term debt 1,274 37,148 Operating lease liabilities, current 1,741 2,018 Deferred revenues, current 9,273 9,015 Derivative liabilities 5 1 Derivative liabilities - related party 476 — Other short-term liabilities 3,598 4,682 Total current liabilities 42,852 77,040 Deferred revenues, non-current 14,849 15,158 Long-term debt 32,877 — Deferred tax liabilities, net — 901 Operating lease liabilities, non-current 5,650 6,428 Other long-term liabilities 60 165 Total liabilities 96,288 99,692 Mezzanine equity: Preferred Series B, 0 share issued and outstanding at December 31, 2025; 1,586,620 shares issued and outstanding at December 31, 2024 — 16,146 Preferred Series C, 0 share issued and outstanding at December 31, 2025; 1,320,850 shares issued and outstanding at December 31, 2024 — 12,363 Total mezzanine equity — 28,509 Stockholders’ equity: Preferred Series A stock, $ 0.0001 par value, 50,000,000 shares authorized; 167,972 and 167,972 shares issued and outstanding, at December 31, 2025 and 2024, respectively — — Preferred Series B stock, $ 0.0001 par value, 1,586,620 shares and 0 share issued and outstanding, at December 31, 2025 and 2024, respectively — — Common stock, $ 0.0001 par value, 4,166,667 and 625,000 shares authorized; 1,370,010 and 328,436 Class A shares issued and outstanding at December 31, 2025 and 2024, respectively — — Additional paid-in capital 155,123 119,487 Accumulated deficit ( 156,420 ) ( 132,610 ) Accumulated other comprehensive income 2,552 227 Total stockholders’ equity (deficit) 1,255 ( 12,896 ) Total liabilities and stockholders’ equity $ 97,543 $ 115,305 See Accompanying Notes to Consolidated Financial Statements. F-4 T able of Cont ents Boxlight Corporation Consolidated Statements of Operations and Comprehensive Loss For the Years Ended December 31, 2025 and 2024 (in thousands, except per share amounts) 2025 2024 Revenues, net $ 109,246 $ 135,893 Cost of revenues 75,617 88,952 Gross profit 33,629 46,941 Operating expense: General and administrative 35,454 41,756 Depreciation and amortization 10,280 20,529 Research and development 4,269 4,126 Total operating expense 50,003 66,411 Loss from operations ( 16,374 ) ( 19,470 ) Other (expense) income: Interest expense, net ( 10,032 ) ( 10,252 ) Other income (expense), net 1,075 ( 727 ) Loss on warrant issuance ( 578 ) — Change in fair value of derivative liabilities ( 4 ) 205 Change in fair value of related party derivative liabilities ( 211 ) — Change in fair value of common warrants 1,394 — Total other expense ( 8,356 ) ( 10,774 ) Loss before income taxes ( 24,730 ) ( 30,244 ) Income tax benefit 920 1,909 Net loss ( 23,810 ) ( 28,335 ) Fixed dividends - Series B Preferred ( 1,269 ) ( 1,269 ) Net loss attributable to common stockholders $ ( 25,079 ) $ ( 29,604 ) Comprehensive loss: Net loss ( 23,810 ) ( 28,335 ) Other comprehensive loss: Foreign currency translation adjustment 2,325 ( 1,074 ) Total comprehensive loss $ ( 21,485 ) $ ( 29,409 ) Net loss per common share – basic and diluted $ ( 39.74 ) $ ( 90.69 ) Weighted average number of common shares outstanding – basic and diluted 631,091 326,439 See Accompanying Notes to Consolidated Financial Statements. F-5 T able of Cont ents Boxlight Corporation Consolidated Statements of Changes in Stockholders’ Equity (Deficit) For the Year Ended December 31, 2025 (in thousands except share amounts) Series A Preferred Stock Series B Preferred Stock Class A Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income Accumulated Deficit Total Shares Amount Shares Amount Shares Amount Balance, December 31, 2024 167,972 — — — 328,436 — 119,487 227 ( 132,610 ) ( 12,896 ) Adjustment to beginning balance — — — — ( 367 ) — — — — — Balance, December 31, 2024 - as adjusted 167,972 — — — 328,069 — 119,487 227 ( 132,610 ) ( 12,896 ) Shares issued for: Vesting of restricted share units — — — — 1,247 — ( 4 ) — — ( 4 ) Reverse stock split fractional adjustment — — — — - 137 — — — — — Prefunded warrants exercised — — — — 177,167 — — — — — Common warrants exercised — — — — 147,000 — 1,879 — — 1,879 February 2025 private placement — — — — 43,333 — 375 — — 375 September 2025 private placement — — — — 222,222 — 3,588 — — 3,588 Amendment of Series B preferred stock — — 1,586,620 — — — 16,146 — — 16,146 Conversion of Series C preferred stock — — — — 33,153 12,363 — — 12,363 ATM program — — — — 417,956 — 658 — — 658 Stock compensation — — — — — — 273 — — 273 Warrant reclassification from liabilities — — — — — — 1,627 — — 1,627 Foreign currency translation — — — — — — — 2,325 — 2,325 Fixed dividends for preferred shareholders — — — — — — ( 1,269 ) — — ( 1,269 ) Net loss — — — — — — — — ( 23,810 ) ( 23,810 ) Balance, December 31, 2025 167,972 $ — 1,586,620 — 1,370,010 $ — $ 155,123 $ 2,552 $ ( 156,420 ) $ 1,255 See Accompanying Consolidated Notes to Financial Statements. F-6 T able of Cont ents Boxlight Corporation Consolidated Statements of Changes in Stockholders’ Equity (Deficit) For the Year Ended December 31, 2024 (in thousands except share amounts) Series A Preferred Stock Series B Preferred Stock Class A Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Shares Amount Shares Amount Shares Amount Balance, December 31, 2023 - as adjusted 167,972 — — — 323,483 — 119,725 1,301 ( 104,275 ) 16,751 Shares issued for: Vesting of restricted stock units — — — — 4,953 — — — — — Stock compensation — — — — — — 1,031 — — 1,031 Foreign currency translation — — — — — — — ( 1,074 ) — ( 1,074 ) Fixed dividends for preferred shareholders — — — — — — ( 1,269 ) — — ( 1,269 ) Net loss — — — — — — — — ( 28,335 ) ( 28,335 ) Balance, December 31, 2024 167,972 $ — — — 328,436 $ — $ 119,487 $ 227 $ ( 132,610 ) $ ( 12,896 ) See Accompanying Notes to Consolidated Financial Statements. F-7 T able of Cont ents Boxlight Corporation Consolidated Statements of Cash Flows For the Years Ended December 31, 2025 and 2024 (in thousands) 2025 2024 Cash flows from operating activities: Net loss $ ( 23,810 ) $ ( 28,335 ) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Amortization of debt discount and issuance cost 2,672 2,608 Bad debt expense 23 213 Paid-in-kind interest on short-term debt 150 240 Changes in deferred tax assets and liabilities ( 2,373 ) ( 3,415 ) Change in allowance for sales returns and volume rebate ( 1,401 ) ( 181 ) Change in inventory reserve ( 1,246 ) 631 Change in fair value of derivative liability 4 ( 205 ) Change in fair value of related party derivative liability 211 — Change in fair value of common warrants ( 1,394 ) — Stock compensation expense 269 1,389 Depreciation and amortization 10,280 20,529 Loss on disposal of asset — 156 Loss on warrant issuance 578 — Change in right of use assets and lease liabilities ( 344 ) ( 24 ) Changes in operating assets and liabilities: Accounts receivable – trade 3,430 13,957 Inventories 8,072 ( 145 ) Prepaid expenses and other current assets 2,248 ( 861 ) Other assets 70 111 Accounts payable and accrued expenses ( 2,436 ) ( 8,488 ) Accounts payable and accrued expenses - related party 3,699 — Other short-term liabilities ( 930 ) 1,849 Other long-term liabilities — 165 Deferred revenues ( 1,167 ) ( 633 ) Other liabilities 60 — Net cash used in operating activities $ ( 3,335 ) $ ( 439 ) Cash flows from investing activities: Purchases of furniture and fixtures, net ( 102 ) ( 506 ) Net cash used in investing activities $ ( 102 ) $ ( 506 ) Cash flows from financing activities: Proceeds from issuances of short-term debt 2,500 4,000 Principal payments on long-term debt ( 5,553 ) ( 5,622 ) Principal payments on short-term debt ( 2,500 ) ( 4,249 ) Payments of fixed dividends to Series B Preferred stockholders — ( 1,269 ) Proceeds from issuance of common stock and prefunded warrants, net of issuance costs 6,409 — Proceeds from exercise of warrants 1,879 — Proceeds from At-the-Market offering program 658 — Net cash provided by (used in) financing activities $ 3,393 $ ( 7,140 ) Effect of foreign currency exchange rates 1,407 ( 1,161 ) Net increase (decrease) in cash and cash equivalents 1,363 ( 9,246 ) Cash and cash equivalents, beginning of the year 8,007 17,253 Cash and cash equivalents, end of the year $ 9,370 $ 8,007 Supplemental cash flow disclosures: Cash paid for income taxes $ 1,356 $ 3,193 Cash paid for interest $ 6,475 $ 7,170 Non-cash investing and financing transactions: Addition of operating lease liabilities $ 125 $ 681 Related party inventory financing $ 3,699 $ — Reclassification of warrant liabilities $ 2,002 $ — See Accompanying Notes to Consolidated Financial Statements. F-8 T able of Cont ents Notes to Consolidated Financial Statements Boxlight Corporation NOTE 1 – ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES COMPANY HISTORY AND RECENT ACQUISITIVE GROWTH Boxlight Corporation (the “Company,” “we,” “us,” and “our”) was incorporated in the State of Nevada on September 18, 2014 with its headquarters in Atlanta, Georgia for the purpose of becoming a technology company that sells interactive educational products. The Company designs, produces, and distributes interactive technology solutions predominantly to the education market. BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION The accompanying consolidated financial statements include the accounts of Boxlight Corporation and its wholly owned subsidiaries. Intercompany transactions and account balances among all affiliated entities have been eliminated. The consolidated financial statements reflect all adjustments, which are normal and recurring in nature and necessary for fair financial statement presentation. ESTIMATES AND ASSUMPTIONS The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from those estimates. Significant estimates include estimates of reserves for inventory obsolescence; the recoverability of deferred tax assets; the fair value of warrants; the fair value and recoverability of intangible assets and goodwill; the fair value of stock compensation; the relative stand-alone selling prices of goods and services; variable consideration; and long-term incentive plans. REVERSE STOCK SPLITS AND RECLASSIFICATIONS In order to regain compliance with NASDAQ Listing Rule 5550(a)(2) (the "Bid Price Rule") and to manage its continued listing on Nasdaq, during 2025 the Company effected two reverse stock splits of its Class A common stock. On February 12, 2025, the Company filed a Certificate of Change with the Nevada Secretary of State to effect a 1-for-5 reverse stock split of its Class A common stock, which became effective on February 14, 2025. On December 16, 2025, the Company filed an additional Certificate of Change with the Nevada Secretary of State to effect a 1-for-6 reverse stock splits of its Class A common stock, which became effective on December 22, 2025. Following the February 2025 1-for-5 reverse stock split, the authorized shares for Class A common stock were adjusted to 3,750,000 , the authorized shares for Class B common stock remained at 50,000,000 shares, and the authorized shares of preferred stock remained unchanged at 50,000,000 shares. The par value of the common stock was not adjusted. On February 20, 2025, the Company filed with the Secretary of State of the State of Nevada amendments to increase the number of authorized shares of Class A common stock to at least 25,000,000 shares. Following the December 2025 1-for-6 reverse stock split, the authorized shares of Class A common stock were further adjusted to 4,166,667 shares, while the authorized shares of Class B common stock and preferred stock remained unchanged. The par value of the common stock was not adjusted. Following the reverse splits, all Class A common share and per share amounts for all periods presented in the consolidated financial statements and the notes to the consolidated financial statements have been retrospectively adjusted to give effect to the reverse stock splits. The quantity of Class A common stock equivalents and the conversion and exercise ratios were adjusted for the effect of both reverse stock splits for warrants, stock compensation arrangements, and the conversion features on preferred shares. In addition, effective October 1, 2025, the Company entered into an agreement with all holders of its Series B preferred stock and Series C preferred stock pursuant to which all outstanding shares of Series C preferred stock were converted into shares of Class A common stock. In connection with the same agreement, the terms of the Series B preferred stock were amended to eliminate the holders’ rights to convert the Series B preferred stock into Class A common stock, the automatic conversion feature, and the holders’ redemption rights. The agreement also provides for the application of a F-9 portion of the net proceeds from certain future equity offerings toward the redemption or repurchase of the Series B preferred stock, subject to applicable limitations. Following these transactions, the Series B preferred stock remained outstanding, and no shares of Series C preferred stock were outstanding as of December 31, 2025. GOING CONCERN The Company’s financial statements are prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of obligations in the normal course of business. Historically, the Company has funded its operations through cash flows from operations, debt financing, and equity financing. As of December 31, 2025, the Company had cash and cash equivalents of $ 9.4 million and working capital of $ 26.6 million. The Company has incurred operating losses in recent periods, and as of December 31, 2025, had an accumulated deficit of $ 156.4 million. The Company’s management has concluded as of December 31, 2025 that, due to uncertainties surrounding the Company’s ability to amend or refinance its current debt agreements and the uncertainty as to whether it will have sufficient liquidity to fund its business activities, substantial doubt exists as to its ability to continue as a going concern. The Company’s plans to alleviate the substantial doubt about its ability to continue as a going concern may not be successful, and it may be forced to limit its business activities or be unable to continue as a going concern, which would have a material adverse effect on its results of operations and financial condition. The consolidated financial statements included herein have been prepared assuming that the Company will continue as a going concern and contemplating the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company’s ability to continue as a going concern is dependent on generating profitable operating results, having sufficient liquidity, and maintaining compliance with the covenants and other requirements under the Whitehawk Capital Partners Credit Agreement (the “Whitehawk Capital Partners Credit Agreement”). The current Whitehawk Capital Partners Credit Agreement maturity date is April 1, 2027, as modified by the Eleventh Amendment to the Credit Agreement. Additional information regarding the Eleventh Amendment to the Credit Agreement is included in Note 9 – Debt to the Consolidated Financial Statements included in this Annual Report on Form 10-K. Based on the Company’s current forecasts, without additional financing, the Company anticipates that it will not have sufficient cash and cash equivalents to repay amounts due under the Whitehawk Capital Partners Credit Agreement at maturity on April 1, 2027. Management plans to seek additional liquidity from other lenders and capital markets. There can be no assurance that the Company’s management will be able to affect financing on acceptable terms or repay this outstanding indebtedness, when required, or if at all. The consolidated financial statements included in this Form 10-K do not include any adjustments that might result from the outcome of the Company’s efforts to address these issues. Furthermore, if the Company cannot raise capital on acceptable terms, it may not, among other things, be able to: • Continue to expand the Company’s research and product investments and sales and marketing organization; • Respond to competitive pressures or unanticipated working capital requirements. COMPREHENSIVE LOSS Comprehensive loss reflects the change in equity during the year except those resulting from investments by and distributions to stockholders and is comprised of all components of net loss and foreign currency translation adjustments. FOREIGN CURRENCIES The Company’s reporting currency is the U.S. dollar. The U.S. dollar is the currency of the primary economic environment in which it operates and is generally the currency in which the Company’s business generates and expends cash. Subsidiaries with different functional currencies translate their assets and liabilities into U.S. dollars at the exchange rates in effect as of the balance sheet date. Revenues and expenses are translated into U.S. dollars at the average exchange rates for the year. The resulting translation F-10 adjustments are included in accumulated other comprehensive income (loss), a separate component of equity (deficit). Foreign exchange gains and losses arise from transactions denominated in currencies other than the functional currency. Gains and losses on those foreign currency transactions are included in determining net loss for the period in which the exchange rates change. CASH AND CASH EQUIVALENTS The Company considers all highly liquid short-term investments purchased with an original maturity of three months or less to be cash equivalents. These investments are carried at cost, which approximates fair value. The Company maintains cash balances at financial institutions which, from time to time, may exceed Federal Deposit Insurance Corporation insured limits of $ 250,000 for banks located in the U.S. The Company has not experienced any losses with regard to its bank accounts and believes it is not exposed to any risk of loss on its cash bank accounts. ACCOUNTS RECEIVABLE AND ALLOWANCE FOR EXPECTED CREDIT LOSS Accounts receivable are stated at contractual amounts, net of an allowance for expected credit losses. The allowance for credit losses represents management’s estimate of the amounts that ultimately will not be realized in cash. The Company reviews the adequacy of the allowance for credit losses on an ongoing basis, using historical payment trends, the age of receivables and knowledge of the individual customers. Estimated credit losses consider relevant information about past events, current conditions, and reasonable and supporting forecasts that affect the collectability of financial assets. When the analysis indicates, management increases or decreases the allowance accordingly. However, if the financial condition of our customers were to deteriorate, additional allowances might be required. The Company also offers customers rights to return products and sales incentives, which primarily consist of volume rebates. The Company’s terms for product returns and sales incentives generally do not exceed a year. The Company estimates sales returns and volume rebate accruals throughout the year based on various factors, including contract terms, historical experience, and performance levels. Total accrued sales returns were approximately $ 0.6 million and $ 2.4 million as of December 31, 2025 and 2024, respectively, and are reported in other current liabilities. Total accrued sales incentives were approximately $ 0.7 million and $ 0.9 million as of December 31, 2025 and 2024, respectively, and are reported in other current liabilities. INVENTORIES Inventories are stated at the lower of cost or net realizable value and include spare parts and finished goods. Inventories are primarily determined using specific identification and the first-in, first-out (“FIFO”) cost methods. Cost includes direct cost from the Current Manufacturer (“CM”) or Original Equipment Manufacturer (“OEM”), plus material overhead related to the purchase, inbound freight, and import duty costs. The Company continuously reviews its inventory levels to identify slow-moving merchandise and markdowns necessary to clear slow-moving merchandise, which reduces the cost of inventories to its estimated net realizable value. Consideration is given to several quantitative and qualitative factors, including current pricing levels and the anticipated need for subsequent markdowns, aging of inventories, historical sales trends, and the impact of market trends and economic conditions. Estimates of markdown requirements may differ from actual results due to changes in quantity, quality, and mix of products in inventory, as well as changes in consumer preferences, market and economic conditions. PROPERTY AND EQUIPMENT Property and equipment is stated at cost and depreciated using the straight-line method over the estimated life of the asset. Repairs and maintenance are charged to expense as incurred. LONG–LIVED ASSETS Long-lived assets to be held and used or disposed of other than by sale are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. When required, impairment losses on assets to be held and used or disposed of other than by sale are recognized based on the fair value of the asset. Long-lived assets to be disposed of by sale are reported at the lower of carrying amount or fair value less cost to sell. There was no impairment recognized for 2025 and 2024. F-11 INTANGIBLE ASSETS Intangible assets are amortized using the straight-line method over their estimated period of benefit and presented net of accumulated amortization. The Company reviews the carrying amounts of intangible assets for impairment whenever an event or change in circumstances indicates that the carrying amount of the assets may not be recoverable. The Company measures the recoverability of intangible assets by comparing the carrying amount of each asset group to the future undiscounted cash flows the Company expects the asset to generate. Impairment is measured by the amount in which the carrying value of the asset exceeds its fair value. In addition, the Company periodically evaluates the estimated remaining useful lives of long-lived intangible assets to determine whether events or changes in circumstances warrant a revision to the remaining period of amortization. During the year 2024, the Company determined that certain triggering events had occurred as a result of a decline in the Company’s revenues resulting from lower sales volume, primarily resulting from lower global demand for interactive flat panel displays. As a result, the Company performed impairment tests on its finite-lived intangible assets using undiscounted cash flows. Based on the quantitative test performed, no impairment was deemed necessary. Certain estimates and assumptions, including the Company’s operating forecast for 2025 and future periods, were further revised based on current industry and Company trends. The useful lives of certain intangible assets have been revised to reflect the current expected economic useful lives. Amortization expense as of December 31, 2024 included approximately $ 12.3 million of accelerated amortization resulting from a revision to the useful lives of certain intangible assets from both the Americas and EMEA reporting segments to reflect the current expected economic useful life due to forecasted industry changes in the interactive flat panel display market as well as the Company’s operational strategy to move to a unified worldwide display brand. For the years ended December 31, 2025 and 2024, the Company recorded amortization expense on intangible assets of $ 9.8 million and $ 19.9 million, respectively. Changes to gross carrying amount of recognized intangible assets due to translation adjustments were approximately $ 0.0 million and ($ 0.8 ) million as of December 31, 2025 and 2024, respectively. DERIVATIVE TREATMENT OF STOCK PURCHASE WARRANTS The Company classifies common stock purchase warrants as equity if the contracts (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions as either an asset or a liability. The Company assesses the classification of its freestanding derivatives at each reporting date to determine whether a change in classification between equity and liabilities is required. The Company determined that certain warrants to purchase common stock do not satisfy the criteria for classification as equity instruments due to the existence of certain net cash and non-fixed settlement provisions that are not within the sole control of the Company. Such warrants are measured at fair value at each reporting date, and the changes in fair value are included in determining net loss for the period. See Note 10 “Derivative Liabilities” for more information. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company’s financial instruments primarily include cash, accounts receivable, derivative liabilities, accounts payable, and debt. Due to the short-term nature of cash, accounts receivable, and accounts payable, the carrying amounts of these assets and liabilities approximate their fair value. The Company has determined that the estimated fair value of debt is approximately $ 25.9 million while the carrying value, excluding discounts, premiums and issuance costs, is approximately $ 32.2 million. The fair value of debt was estimated using market rates the Company believes would be available for similar types of financial instruments and represents a Level 2 measurement. Derivative liabilities and common warrants are recorded at fair value on a recurring basis. Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. A fair value hierarchy has been established for valuation inputs that gives the F-12 highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows: Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means. Level 3 Inputs - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. Transfers into Level 3 measurements during the year ended December 31, 2024 of $ 0.4 million were related to the Company’s long-term incentive plan. The following tables set forth, by level within the fair value hierarchy, the Company’s financial liabilities that were accounted for at fair value on a recurring basis as of December 31, 2025 and 2024 (in thousands): Description Markets for Identical Assets (Level 1) Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Carrying Value as of December 31, 2025 Long-term incentive plan $ — $ — $ 205 $ 205 Description Markets for Identical Assets (Level 1) Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Carrying Value as of December 31, 2025 Derivative liabilities - warrant instruments $ — $ — $ 5 $ 5 Derivative liabilities - related party $ — $ — $ 476 $ 476 Description Markets for Identical Assets (Level 1) Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Carrying Value as of December 31, 2024 Long-term incentive plan $ — $ — $ 358 $ 358 Description Markets for Identical Assets (Level 1) Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Carrying Value as of December 31, 2024 Derivative liabilities - warrant instruments $ — $ — $ 1 $ 1 Derivative liabilities - related party $ — $ — $ — $ — The following tables reconcile the beginning and ending balances of the warrant instruments and long-term incentive plan within Level 3 of the fair value hierarchy, respectively: F-13 Common Warrants Liabilities (in thousands) Derivative Liabilities (in thousands) Related Party Derivative Liabilities (in thousands) Long-term incentive plan (in thousands) Balance, December 31, 2024 $ — $ 1 $ — $ 358 Issuance during the year 3,396 — 265 — Change in fair value ( 1,394 ) 4 211 ( 153 ) Balance, December 31, 2025 $ 2,002 $ 5 $ 476 $ 205 (in thousands) (in thousands) (in thousands) (in thousands) Balance, December 31, 2023 $ — $ 205 $ — $ — Change in fair value — ( 204 ) — 358 Balance, December 31, 2024 $ — $ 1 $ — $ 358 See Note 10 and Note 13 for discussion of the valuation techniques and inputs. NET LOSS PER COMMON SHARE Basic loss per common share is computed by dividing net loss available to common shareholders by the weighted-average number of common shares outstanding during the period. For purposes of this calculation, options to purchase common stock, restricted stock units subject to vesting, and warrants to purchase common stock were considered to be common stock equivalents. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. The dilutive effect of convertible instruments is determined using the if-converted method, presuming share settlement. Under the if-converted method, securities are assumed to be converted at the beginning of the period, and the resulting common shares are included in the denominator of the diluted calculation for the entire period being presented. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive. For the year ended December 31, 2025, potentially dilutive securities that were not included in the diluted per share calculation because they did not comprise any shares from options to purchase common shares, 1 thousand of unvested restricted shares, and 80 thousand shares issuable upon exercise of warrants. Additionally, potentially dilutive securities of 10 thousand shares from the assumed conversion of preferred stock are excluded from the denominator because they would be anti-dilutive. F or the year ended December 31, 2024, potentially dilutive securities that were not included in the diluted per share calculation because they would be anti-dilutive comprise 6 thousand shares from options to purchase common shares, unvested restricted shares of 3 thousand and 50 thousand shares issuable upon exercise of warrants. Additionally, potentially dilutive securities of 70 thousand shares from the assumed conversion of preferred stock are excluded from the denominator because they would be anti-dilutive. REVENUE RECOGNITION In accordance with Topic 606 Revenue from Contracts with Customers, the Company recognizes revenue at the amount to which it expects to be entitled when control of the products or services is transferred to its customers. Control is generally transferred when the Company has a present right to payment and the title and the significant risks and rewards of ownership of products or services are transferred to its customers. Product revenue is derived from the sale of interactive panels, audio and communication equipment, and related software and accessories to distributors, resellers, and end users. Service revenue is derived from hardware maintenance services, product installation, training, software maintenance, and subscription services. F-14 Nature of Products and Services and Related Contractual Provisions The Company’s sales of interactive devices, including panels, audio and communication equipment, and other interactive devices generally include hardware maintenance services, a license to software, and the provision of related software maintenance. Interactive devices are generally sold with hardware maintenance services with terms of approximately 36 - 60 months. Software maintenance includes technical support, product updates on a when and if available basis, and error correction services. At times, non-interactive panels are also sold with hardware maintenance services with terms of approximately 60 months. The Company also licenses software independently of its interactive devices, in which case it is bundled with software maintenance, and in some cases, subscription services that include access to online content and cloud-based applications. The Company’s software subscription services provide access to content and software applications on an as needed basis over the internet, but do not provide the right to take delivery of the software applications. The Company’s product sales, including those with software and related services, generally include a single payment up front for the products and services, and revenue is recorded net of estimated sales returns and rebates based on the Company’s expectations and historical experience. For most of the Company’s product sales, control transfers, and therefore, revenue is recognized when products are shipped at the point of origin. When the Company transfers control of its products to the customer prior to the related shipping and handling activities, the Company has adopted a policy of accounting for shipping and handling activities as a fulfillment cost rather than a performance obligation. For many of the Company’s software product sales, control is transferred when shipped at the point of origin since the software is installed on the interactive hardware device in advance of shipping. For other software product sales, control is transferred when the customer receives the related access code or interactive hardware since the customer’s access code or connection to the interactive hardware activates the software license at which time the software is made available to the customer. For the Company’s software maintenance, hardware maintenance, and subscription services, revenue is recognized ratably over time as the services are provided since time is the best output measure of how those services are transferred to the customer. The Company’s installation, training, and professional development services are generally sold separately from the Company’s products. Control of these services is transferred to our customers over time with hours/time incurred in providing the service being the best depiction of the transfer of services since the customer is receiving the benefit of the services as the work is performed. For the sale of third-party products and services where the Company obtains control of the products and services before transferring it to the customer, the Company recognizes revenue based on the gross amount billed to customers. The Company considers multiple factors when determining whether it obtains control of the third-party products and services including, but not limited to, evaluating if it can establish the price of the product, retains inventory risk for tangible products, or has the responsibility for ensuring acceptability of the product or service. The Company has not historically entered into transactions where it does not take control of the product or service prior to transfer to the customer. The Company excludes all taxes assessed by a governmental agency that are both imposed on and concurrent with the specific revenue-producing transaction from revenue (for example, sales and use taxes). In essence, the Company is reporting these amounts collected on behalf of the applicable government agency on a net basis as though they are acting as an agent. The taxes collected and not yet remitted to the governmental agency are included in accounts payable and accrued expenses in the accompanying consolidated balance sheets. Significant Judgments For contracts with multiple performance obligations, each of which represents promises within a contract that are distinct, the Company allocates revenue to all distinct performance obligations based on their relative stand-alone selling prices (“SSPs”). The Company’s products and services included in its contracts with multiple performance obligations generally are not sold separately and there are no observable prices available to determine the SSP for those products and services. Since observable prices are not available, SSPs are established that reflect the Company’s best estimates of what the selling prices of the performance obligations would be if they were sold regularly on a stand-alone basis. The Company’s process for estimating SSPs without observable prices considers multiple factors that may vary depending upon the unique facts and circumstances related to each performance obligation including, when applicable, the estimated cost to provide the performance obligation, market trends in the pricing for similar offerings, product-specific business objectives, and competitor or other relevant market pricing and margins. Because observable prices are generally not available for the F-15 Company’s performance obligations that are sold in bundled arrangements, the Company does not apply the residual approach to determining SSP. The Company has applied the portfolio approach to its allocation of the transaction price for certain portfolios of contracts that are executed in the same manner, contain the same performance obligations, and are priced in a consistent manner. The Company believes that the application of the portfolio approach produces the same result as if they were applied at the contract level. Contract Balances The timing of invoicing to customers often differs from the timing of revenue recognition and these timing differences can result in receivables, contract assets, or contract liabilities (deferred revenue) on the Company’s consolidated balance sheets. Fees for the Company’s product and most service contracts are fixed, except as adjusted for rebate programs when applicable, and are generally due within 30 - 60 days of contract execution. Fees for installation, training, and professional development services are fixed and generally become due as the services are performed. The Company has an established history of collecting under the terms of its contracts without providing refunds or concessions to its customers. The Company’s contractual payment terms do not vary when products are bundled with services that are provided over multiple years. In these contracts, where services are expected to be transferred on an ongoing basis for several years after the related payment, the Company has determined that the contracts generally do not include a significant financing component. The upfront invoicing terms are designed 1) to provide customers with a predictable way to purchase products and services where the payment is due in the same timeframe as when the products, which constitute the predominant portion of the contractual value, are transferred, and 2) to ensure that the customer continues to use the related services, so that the customer will receive the optimal benefit from the products over their lives. Additionally, the Company has elected the practical expedient to exclude any financing component from consideration for contracts where, at contract inception, the period between the transfer of services and the timing of the related payment is not expected to exceed one year. The Company has an unconditional right to consideration for all products and services transferred to the customer. That unconditional right to consideration is reflected in accounts receivable in the accompanying consolidated balance sheets in accordance with Topic 606. Contract liabilities are reflected in deferred revenue in the accompanying consolidated balance sheets and reflect amounts allocated to performance obligations that have not yet been transferred to the customer related to software maintenance, hardware maintenance, and subscription services. The Company has no material contract assets at December 31, 2025 or 2024. The following table presents the opening and closing balances of the Company’s accounts receivable- trade, net of allowances, deferred revenue, current, and deferred revenue, non-current (in thousands): January 1, 2024 December 31, 2024 December 31, 2025 Accounts receivable – trade, net of allowances 32,668 18,325 15,358 Deferred revenues, current 8,698 9,015 9,273 Deferred revenues, non-current 16,347 15,158 14,849 During the years ended December 31, 2025 and 2024, the Company recognized $ 7.0 million and $ 8.5 million, respectively, of revenue that was included in the deferred revenue balance as of December 31, 2024 and 2023, respectively. Variable Consideration The Company’s otherwise fixed consideration in its customer contracts may vary when refunds or credits are provided for sales returns, stock rotation rights, price protection provisions, or in connection with certain other rebate provisions. The Company generally does not allow product returns other than under assurance warranties or hardware maintenance contracts. However, the Company, on a case-by-case basis, will grant exceptions, mostly “buyer’s remorse” where the distributor or reseller’s end customer either did not understand what they were ordering, or determined that the product did not meet their needs. An allowance for sales returns is estimated based on an analysis of historical trends. In very limited situations, a customer may return previous purchases held in inventory for a specified period of time in exchange for credits toward additional purchases. The Company provides rebates to certain customers based on the achievement of certain sales targets. The provision for rebates is estimated based on customers’ contracted rebate programs F-16 and our historical experience of rebates paid. The Company includes variable consideration in its transaction price when there is a basis to reasonably estimate the amount of the fee and it is probable there will not be a significant reversal. These estimates are generally made using the most likely method based on historical experience and are measured at each reporting date. There was no material revenue recognized in 2025 related to changes in estimated variable consideration that existed at December 31, 2024. Remaining Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of accounting within the contract. The transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied by transferring the promised good or service to the customer. The Company identifies performance obligations at contract inception so that it can monitor and account for the obligations over the life of the contract. Remaining performance obligations represent the portion of the transaction price in a contract allocated to products and services not yet transferred to the customer. As of December 31, 2025 and 2024, the aggregate amount of the contractual transaction prices allocated to remaining performance obligations was $ 24.1 million and $ 24.2 million, respectively. The Company expects to recognize revenue on approximately 37 % of the remaining performance obligations in 2026, 29 % in 2027, 19 % in 2028, 11 % in 2029, with the remainder recognized thereafter. In accordance with Topic 606, the Company has elected not to disclose the value of remaining performance obligations for contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed (for example, a time-and-materials professional services contract). In addition, the Company has elected not to disclose the value of remaining performance obligations for contracts with performance obligations that are expected, at contract inception, to be satisfied over a period that does not exceed one year. Disaggregated Revenue The Company disaggregates revenue based upon the nature of its products and services and the timing and in the manner which it is transferred to the customer. Although all products are transferred to the customer at a point in time, hardware and some software is pre-installed on the interactive device are transferred at the point of shipment, while some software is transferred to the customer at the time the hardware is received by the customer or when software product access codes are delivered electronically to the customer. All service revenue is transferred over time to the customer; however, professional services are generally transferred to the customer within a year from the contract date as measured based upon hours or time incurred while software maintenance, hardware maintenance, and subscription services are generally transferred 3 - 5 years from the contract execution date as measured based upon the passage of time. Year Ended December 31, (in thousands) 2025 2024 Product revenues: Hardware $ 103,742 $ 124,378 Software and embedded firmware 648 1,198 Service revenues: Professional services 120 903 Maintenance and subscription services 4,736 9,414 $ 109,246 $ 135,893 Contract Costs The Company capitalizes incremental costs to obtain a contract with a customer if the Company expects to recover those costs. The incremental costs to obtain a contract are those that the Company incurs to obtain a contract with a customer that it would not have otherwise incurred if the contract were not obtained (e.g., a sales commission). The Company capitalizes the costs incurred to fulfil a contract only if those costs meet all the following criteria: • The costs relate directly to a contract or to an anticipated contract that the Company can specifically identify. F-17 • The costs generate or enhance resources of the Company that will be used in satisfying (or in continuing to satisfy) performance obligations in the future. • The costs are expected to be recovered. Certain sales commissions incurred by the Company were determined to be incremental costs to obtain the related contracts, which are deferred and amortized ratably over the estimated economic benefit period. For these sales commissions that are incremental costs to obtain where the period of amortization would have been recognized over a period that is one year or less, the Company elected the practical expedient to expense those costs as incurred. Commission costs that are deferred are classified as current or non-current assets based on the timing of when the Company expects to recognize the expense and are included in prepaid expenses and other current assets and other assets, respectively, in the accompanying consolidated balance sheets. Total deferred commissions, net of accumulated amortization, at December 31, 2025 and 2024 were less than $ 400,000 and $ 500,000 , respectively. The Company has not historically incurred any material fulfillment costs that meet the criteria for capitalization. SEGMENT REPORTING ASC 280, Segment Reporting, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (CODM), or decision-making group, in deciding how to allocate resources and in assessing performance. Our CODM is our Chief Executive Officer. The Company’s operations are organized, managed, and classified into three reportable segments – Europe, Middle East and Africa ("EMEA"), North and Central America (the “Americas”), and all other geographic regions (“Rest of World”). Our EMEA segment consists of the operations of Sahara Holding Limited and its subsidiaries (the “Sahara Entities”). Our Americas segment consists primarily of Boxlight, Inc. and its subsidiaries and the Rest of World segment consists primarily of Boxlight Australia, PTY LTD ("Boxlight Australia”). Each of our operating segments is primarily engaged in the sale of education technology products and services in the education market, but which are also sold into the health, government, and corporate sectors and derive a majority of their revenues from the sale of flat-panel displays, audio and other hardware accessory products, software solutions, and professional services. Generally, our displays produce higher net operating revenues but lower gross profit margins than our accessory solutions and professional services. The Americas operating segment includes salaries and overhead for corporate functions that are not allocated to the Company’s individual reporting segments. Transfers between segments are generally valued at market and are eliminated in consolidation. The CODM evaluates the performance of each segment based on revenues, gross profit, and operating income, with operating income being the primary GAAP measure. Gross margin can influence key decisions as margins can be indicative of the level of saturation in the market with existing products or can be indicative of changes in manufacturing or shipping costs. If trends are sustained, the CODM may seek to adjust operations to more favorable markets or may evaluate whether the Company should introduce new products in a given area. Operating income provides the CODM with an overview of the profitability of a given segment and whether resources should be allocated or removed to ensure sustained profitability for both the segment and the consolidated entity. Since the Company’s operating segments are organized by geography, this structure allows the CODM to be responsive to needs of customers and can execute strategic plans and initiatives accordingly. RESEARCH AND DEVELOPMENT EXPENSES Research and development costs are expensed as incurred and consist primarily of personnel related costs, prototype and sample costs, design costs, and global product certifications mostly for wireless certifications. INCOME TAX An asset and liability approach is used for financial accounting and reporting for income taxes. Deferred income taxes arise from temporary differences between income tax and financial reporting and principally relate to recognition of revenue and expenses in different periods for financial and tax accounting purposes and are measured using currently F-18 enacted tax rates and laws. In addition, a deferred tax asset can be generated by net operating loss carryforwards. If it is more likely than not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized. STOCK COMPENSATION The Company estimates the fair value of each stock option award at the grant date by using the Black-Scholes option pricing model; the fair value for each restricted stock unit award is the market price of the underlying shares at the date of grant. The fair value determined represents the cost for the award and is recognized on a straight-line basis over the vesting period during which an employee is required to provide service in exchange for the award. Total expense is reduced by the previously recognized compensation expense for options and restricted stock units that are forfeited prior to vesting when the forfeiture occurs. The Company estimates the fair value of the long-term incentive plan by using a Monte Carlo Simulation Model. The amount of each award earned will depend on the performance of the Company relative to certain performance targets related to share price appreciation of the Company’s Class A common stock during the respective performance cycles. As amounts earned for the awards are based on changes in the Company’s stock price, the Company will recognize a liability for compensation cost each reporting period based on the fair value as of each reporting date proportionally with the elapsed time at each reporting period. LEASES Operating lease assets and liabilities are reflected within operating lease assets, operating lease liabilities, current, and operating lease liabilities, non-current, on the consolidated balance sheets. Operating lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Many of the leases have one or more lease renewal options. The exercise of lease renewal options is at our sole discretion. The Company does not consider the exercise of any lease renewal options reasonably certain to occur. Certain of our lease agreements contain early termination options. No renewal options or early termination options have been included in the calculation of the operating right-of-use assets or operating lease liabilities. Certain of our lease agreements provide for periodic adjustments to rental payments for inflation, which is recognized as variable lease cost when they occur. As the majority of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate at the commencement date in determining the present value of lease payments. The incremental borrowing rate is based on the terms of the lease. Leases with an initial term of 12 months or less are not recorded on the balance sheet. For these short-term leases, lease expense is recognized on a straight-line basis over the lease term. The Company is not a lessor in any lease agreement. ADVERTISING COSTS Advertising costs are expensed as incurred and included in General and Administrative expenses in the accompanying consolidated statements of operations and comprehensive loss. Advertising expense for the years ended December 31, 2025 and December 31, 2024 totaled $ 250 thousand and $ 162 thousand, respectively. NEW ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which enhances reporting requirements under Topic 280. The enhanced disclosure requirements include: title and position of the Chief Operating Decision Maker (CODM), significant segment expenses provided to the CODM, extending certain annual disclosures to interim periods, clarifying that single reportable segment entities must apply ASC 280 in its entirety, and permitting more than one measure of segment profit or loss to be reported under certain circumstances. The Company adopted this change for the year ended December 31, 2024 and interim periods beginning 2025. This change was applied retrospectively to all periods presented. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740), which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The new guidance requires consistent categorization and greater disaggregation of information in the rate reconciliation, as F-19 well as further disaggregation of income taxes paid. This change is effective for annual periods beginning after December 15, 2024. The company is adopting the new standard on a prospective basis. In November 2024, the FASB issued ASU 2024-03, In come Statement-reporting Comprehensive Income- Expense Disaggregation Disclosures (Subtopic 220-40), which improves the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, SG&A, and research and development). This change is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. This change will apply on a prospective basis to annual financial statements for periods beginning after the effective date. However, retrospective application in all prior periods presented is permitted. The Company is currently evaluating the impact of this ASU on its financial statements. In January 2025, the FASB ASU 2025-01— Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date . The Board issued this Update to clarify the effective date of Accounting Standards Update No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The change is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its financial statements. NOTE 2 – ACCOUNTS RECEIVABLE - TRADE Accounts receivable consisted of the following at December 31, 2025 and 2024 (in thousands): 2025 2024 Accounts receivable – trade $ 16,413 $ 18,719 Allowance for credit losses ( 1,055 ) ( 394 ) Accounts receivable - trade, net of allowances $ 15,358 $ 18,325 Write-offs of accounts receivable were approximately $ 78 thousand and $ 22 thousand for the years ended December 31, 2025 and 2024, respectively. Recoveries of accounts receivable were approximately $ 10 thousand and $ 88 thousand for the years ended December 31, 2025 and 2024, respectively. The change in the allowance for credit losses was approximately $ 73 thousand and $ 27 thousand during the years ended December 31, 2025 and December 31, 2024. NOTE 3 – INVENTORIES Inventories consisted of the following at December 31, 2025 and 2024 (in thousands): 2025 2024 Finished goods $ 40,103 $ 45,352 Spare parts 571 1,065 Reserve for inventory obsolescence ( 2,548 ) ( 3,152 ) Inventories, net $ 38,126 $ 43,265 F-20 NOTE 4 – PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following at December 31, 2025 and 2024 (in thousands): 2025 2024 Prepayments to vendors $ 625 $ 2,212 Prepaid licenses and other 5,999 6,573 Prepaid expenses and other current assets $ 6,624 $ 8,785 Prepaid expenses and other current assets were presented net of $ 1.4 million reserves related to vendor receivables as of December 31, 2025 and 2024. NOTE 5 – PROPERTY AND EQUIPMENT Property and equipment consisted of the following at December 31, 2025 and 2024 (in thousands): 2025 2024 Building $ 200 $ 200 Building improvements 14 14 Leasehold improvements 1,303 1,303 Office equipment 1,271 1,246 Software 88 88 Other equipment 977 907 Construction in progress — — Property and equipment, at cost 3,853 3,758 Accumulated depreciation ( 2,083 ) ( 1,624 ) Property and equipment, net of accumulated depreciation $ 1,770 $ 2,134 During the year ended December 31, 2024, the Company transferred approximately $ 0.7 million from construction in progress to leasehold improvements and approximately $ 0.3 million from construction in progress to other equipment. For the years ended December 31, 2025 and 2024, the Company recorded depreciation expense of $ 487 thousand and $ 678 thousand, respectively. F-21 NOTE 6 – INTANGIBLE ASSETS AND GOODWILL Intangible assets and goodwill consisted of the following at December 31, 2025 and 2024 (in thousands): Useful lives 2025 2024 INTANGIBLE ASSETS Patents 4 - 10 years $ 100 $ 100 Customer relationships 8 - 15 years 50,973 48,036 Technology 3 - 5 years 8,615 8,371 Non-compete 3 years 391 391 Tradenames 2 - 10 years 12,659 12,253 Intangible assets, at cost 72,738 69,151 Accumulated amortization ( 55,658 ) ( 43,207 ) Intangible assets, net of accumulated amortization $ 17,080 $ 25,944 For the years ended December 31, 2025 and 2024, the Company recorded amortization expense on intangible assets of $ 9.8 million and $ 19.9 million, respectively. Amortization expense as of December 31, 2024 included approximately $ 12.3 million of accelerated amortization resulting from a revision to the useful lives of certain intangible assets from both the Americas and EMEA reporting segments to reflect the current expected economic useful life due to forecasted industry changes in the interactive flat panel display market as well as the Company’s operational strategy to move to a unified worldwide display brand. There was no change to the gross carrying amount of recognized intangible assets due to translation adjustments as of December 31, 2025. Changes to gross carrying amount of recognized intangible assets due to translation adjustments were approximately $( 0.8 ) million as of December 31, 2024. Expected future amortization expense for intangible assets as of December 31, 2025 is as follows (in thousands): 2026 $ 3,629 2027 3,480 2028 3,468 2029 3,446 2030 2,849 Thereafter 208 Total $ 17,080 NOTE 7 – LEASES The Company has entered into various operating leases for certain offices, support locations and vehicles with terms extending through December 2038. Generally, these leases have initial lease terms of five years or less. Operating lease expense was $ 2.3 million and $ 2.4 million for the years ended December 31, 2025 and 2024, respectively. Variable lease costs and short-term lease costs were $ 1.4 million and $ 1.1 million for the year ended December 31, 2025 and 2024, respectively. Cash paid for amounts included in the measurement of lease liabilities was $ 2.4 million and $ 2.1 million for the years ended December 31, 2025 and 2024, respectively. F-22 Future minimum lease payments of the Company’s operating leases with a term over one year subsequent to December 31, 2025 are as follows: Year ending December 31, (in thousands) 2026 $ 1,961 2027 1,304 2028 929 2029 880 2030 841 Thereafter 5,362 Total Lease Liabilities 11,277 Less: Imputed Interest ( 3,886 ) Present Value of Lease Liabilities $ 7,391 During the year ended December 31, 2025, the weighted-average remaining lease term was 9.9 years, and the weighted-average discount rate was 9.5 %. During the year ended December 31, 2024, the weighted-average remaining lease term was 9.6 years, and the weighted-average discount rate was 10.1 %. NOTE 8 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable consisted of the following at December 31, 2025 and 2024 (in thousands): 2025 2024 Accounts payable $ 17,108 $ 20,703 Accounts payable - related party 3,699 — Accrued expense 5,454 3,164 Other 224 309 Accounts payable and other liabilities $ 26,485 $ 24,176 NOTE 9 – DEBT The following comprises debt at December 31, 2025 and 2024 (in thousands): 2025 2024 Debt – Third Parties Paycheck Protection Program $ — $ 16 Note payable - Whitehawk 32,243 37,630 Total debt 32,243 37,646 Less: Premium, discount and issuance costs ( 1,908 ) 498 Current portion of debt 1,274 37,148 Long-term debt $ 32,877 $ — Total debt (net of premium, discount and issuance costs) $ 34,151 $ 37,148 Debt - Third Parties: WhiteHawk Finance LLC In order to finance the acquisition of FrontRow Calypso LLC (“FrontRow”), which closed on December 31, 2022, the Company and substantially all of its direct and indirect subsidiaries, including Boxlight and FrontRow as guarantors, entered into a maximum $ 68.5 million term loan credit facility, dated December 31, 2022 (the “Credit Agreement”), with Whitehawk Finance LLC, as lender (the “Lender”), and White Hawk Capital Partners, LP, as collateral agent F-23 (“Whitehawk” or the “Collateral Agent”). The Company received an initial term loan of $ 58.5 million on December 31, 2022 (the “Initial Loan”) and was provided with a subsequent delayed draw facility of up to $ 10.0 million that may be available for additional working capital purposes under certain conditions (the “Delayed Draw”). The Initial Loan and Delayed Draw are collectively referred to as the “Term Loans.” The Term Loans are secured by substantially all of the assets of the Company. The proceeds of the Initial Loan were used to finance the Company’s acquisition of FrontRow, pay off all indebtedness owed to the Company’s then existing lenders, Sallyport Commercial Finance, LLC and Lind Global Asset Management, LLC, pay related fees and transaction costs, and provide working capital. Of the Initial Loan, $ 8.5 million was subject to repayment on February 28, 2022, with quarterly principal payments of $ 0.6 million and interest payments commencing March 31, 2022 and the $ 40.0 million remaining balance plus any Delayed Draw loans becoming originally due and payable in full on December 31, 2025. The Term Loans initially bore interest at the LIBOR rate plus 10.75 %; provided that after March 31, 2022, if the Company’s Senior Leverage Ratio (as defined in the Credit Agreement) is less than 2.25 , the interest rate would be reduced to LIBOR plus 10.25 %. Such terms were subject to the Company maintaining a borrowing base in compliance with the Credit Agreement. In the event of non-compliance with the borrowing base, the Company would be subject to an increased interest rate as stated in the Credit Agreement. On March 14, 2024, the Company entered into a fifth amendment to the Credit Agreement with the Collateral Agent and Lender (the "Fifth Amendment") to (i) amend and restate the Senior Leverage Ratio and Minimum Liquidity (each as defined in the Fifth Amendment), and (ii) waive any event of default that may have arisen directly as a result of the Company’s Financial Covenant Default (as defined in the Fifth Amendment) at December 31, 2023. Under the Fifth Amendment, the Senior Leverage Ratio requirement at March 31, 2024 was amended from 2.00 to 6.00 , at June 30, 2024 remained at 2.00 and thereafter remained at 1.75 . The Fifth Amendment also added additional financial reporting obligations and additional guarantors under the Credit Agreement. On April 19, 2024, the Company entered into a sixth amendment to the Credit Agreement with the Collateral Agent and Lender (the “Sixth Amendment”). The Sixth Amendment provided the Company with an additional $ 2.0 million working capital bridge loan in April 2024, and an additional $ 3.0 million working capital bridge loan in June 2024, of which $ 2.0 million was advanced to the Company. The Company was required to pay a fee equal to 6 % of the aggregate amount of borrowings under the Sixth Amendment (i.e. $ 4.0 million). Both working capital bridge loans, including the related fee were paid in full by November 2024, and were not subject to prepayment penalties. On August 12, 2024, the Company entered into a seventh amendment to the Credit Agreement with the Collateral Agent and Lender (the “Seventh Amendment”) to (i) reduce the intellectual property sublimit under the borrowing base from $ 15.0 million to $ 11.2 million, and (ii) waive the event of default that may have arisen directly as a result of the Financial Covenant Default (as defined in the Seventh Amendment) at June 30, 2024. On November 14, 2024, the Company obtained a waiver for the Credit Agreement from the Collateral Agent and Lender (the “November 2024 Waiver”) to waive any events of default that may have arisen directly as a result of (i) the Financial Covenant Default (as defined in the November 2024 Waiver) at September 30, 2024 and (ii) the Borrowing Base Default (as defined in the November 2024 Waiver) for the month ended October 31, 2024. In conjunction with obtaining the waiver, the Company paid down approximately $ 1.1 million under the Credit Agreement, inclusive of $ 0.06 million of prepayment penalties. On March 24, 2025, the Company entered into an eighth amendment to the Credit Agreement with the Collateral Agent and Lender (the “Eighth Amendment”) to (i) provide the Company with an additional $ 2.5 million working capital bridge loan and (ii) waive any events of default that may have arisen as a result of the Company’s failure to (A) maintain the required ratio of indebtedness to adjusted EBITDA (defined more specifically as the “Senior Leverage Ratio” in the Credit Agreement) for the periods ended December 31, 2024 and March 31, 2025 and (B) maintain a value of specified assets in excess of certain borrowings (defined more specifically as a “Borrowing Base” in the Credit Agreement) for the months ended December 31, 2024, January 31, 2025 and February 28, 2025. In addition, no payments were required to be made by the Company to pay down the borrowing base defaults for December 2024, January 2025, and February 2025. The Company is required to pay a fee equal to 6 % of the working capital bridge loan under the Eighth Amendment. The bridge loan, including the related fee, is due and payable in full on August 31, 2025, and is not subject to prepayment penalties. On August 13, 2025, the Company entered into a forbearance agreement and ninth amendment and waiver to the Credit Agreement with the Collateral Agent and Lender (the “Ninth Amendment”) to waive any events of default that may have arisen directly as a result of (1) the Financial Covenant Event of Default (as defined in the Ninth Amendment) for the period ended June 30, 2025, (2) the Borrowing Base defaults described in the Ninth Amendment for the months ended F-24 April 30, 2024, May 31, 2025, June 30, 2025, and July 31, 2025, and (3) the failure to comply with the Recapitalization Requirement. Pursuant to the Ninth Amendment, the Company agreed to increase its quarterly principal payment due on September 30, 2025 from the scheduled $ 0.7 million to $ 1.0 million and to change interest payments from being due quarterly to being due monthly beginning in August 2025. On December 2, 2025, the Company entered into the tenth amendment to Credit Agreement with the Collateral Agent and Lender (the “Tenth Amendment”). The Tenth Amendment does not modify that maturity date. Pursuant to the Tenth Amendment, the Lenders agreed to waive certain “Specified Events of Default” that had occurred or were anticipated to occur under the Credit Agreement. These Specified Events of Default included: • Failure to maintain the required Senior Leverage Ratio of 1.75 :1.00 for the period ended September 30, 2025; and • Borrowing base non-compliance for the months ending July 31 through November 30, 2025. • The Lenders waived the right to receive the post-default interest rate with respect to these Specified Events of Default through December 31, 2025, provided the Company complies with the terms of the Tenth Amendment. Although the Company obtained waivers with respect to the foregoing past instances of Credit Agreement noncompliance, in view of the Company’s history of noncompliance and its current situation, there can be no guarantee that the Company will not breach provisions of the Credit Agreement in the future, which could lead to declared events of default, acceleration of obligations and other material negative consequences. The Tenth Amendment required the company to pay a voluntary prepayment of the loans in the amount of not less than $ 3.0 million, for which no prepayment premium is required. From December 2 through December 31, 2025, the “Applicable Margin” is set at 6.50 % for Secured Overnight Financing Rate (SOFR) loans and 5.50 % for reference rate loans. The definition of “Floor” was amended to 4.25 % per annum, and the “Reference Rate” was amended to 5.25 % per annum. Additionally, the borrowing base allowance for the value of the Company’s intellectual property was reduced from a maximum of $ 11.2 million to $ 8.0 million. Also set forth in the Tenth Amendment, 100 % of net cash proceeds from any equity issuances be applied first to reduce any existing indebtedness in excess of the Borrowing Base, with the remainder applied to prepay the loans. On December 18, 2025, the Company entered into the Eleventh Amendment to Credit Agreement with the Collateral Agent and Lender (the “Eleventh Amendment”). Pursuant to the Eleventh Amendment, the Lender agreed to extend the final maturity date of the loans under the Credit Agreement from December 31, 2025 to April 1, 2027. Mandatory quarterly amortization payments on the initial term loan are suspended for the period commencing on the Eleventh Amendment’s effective date through, and including, June 30, 2026, with the first amortization payment thereafter due on September 30, 2026. The “Applicable Margin” is set at 6.50 % for Secured Overnight Financing Rate (SOFR) loans and 5.50 % for reference rate loans, the same as in the Tenth Amendment. Additionally, the definition of the “Reference Rate” was amended to 5.50 % per annum from the previous 5.25 % per annum. In conjunction with obtaining the waiver, the Company was also required to comply with the following covenants: • The Company must maintain qualified cash at all times of at least (i) $ 1.0 million from and after January 1, 2025 until the Eleventh Amendment, and (ii) $ 1.5 million from and after the Eleventh Amendment effective date. • Pursuant to the amendment, the financial covenant requiring compliance with the Senior Leverage Ratio was removed and the Company is subject to a Minimum Consolidated Adjusted EBITDA covenant commencing with the period ending March 31, 2026 (set at $ 1.9 million for such period), and varying thereafter as set forth in the Eleventh Amendment. • Certain covenants related to business, management, and governance oversight were added. In addition, the Eleventh Amendment modifies the mandatory prepayment provisions regarding net cash proceeds from equity offerings and certain permitted additional indebtedness, requiring 50 % (or 100 % if an event of default exists) of such proceeds to be applied to prepay Credit Agreement loans, provided that the loan parties may retain up to $ 5.0 million of such proceeds for working capital and general corporate purposes. The Eleventh Amendment permits Credit Agreement indebtedness in excess of maximum amounts in an aggregate amount not to exceed for the months ending December 31, 2025, $ 4.0 million; January 31, 2026, $ 4.5 million; February 28, 2026, $ 5.5 million and from and after March 31, 2026 (and each month thereafter), $ 4.0 million. Covenant Compliance and Liquidity Considerations The Company’s Credit Agreement, as amended to date, requires compliance with certain covenants, which include provisions regarding over advance limitations based upon a borrowing base, a minimum consolidated adjusted EBITDA covenant, a minimum liquidity requirement, and previously a Senior Leverage Ratio. F-25 The Company was not in compliance with its financial covenant related to the Senior Leverage Ratio under the Credit Agreement as of December 31, 2023. The non-compliance was cured by a waiver applied in accordance with the Fifth Amendment to the Credit Agreement dated March 14, 2024 which waived any Event of Default that may have arisen directly as a result of the financial covenant default at December 31, 2023 and in the interim two-month period ended February 29, 2024. The Fifth Amendment also amended and restated the Senior Leverage Ratio and Minimum Liquidity requirements. Under the Fifth Amendment, the Senior Leverage Ratio requirement at March 31, 2024 was amended from 2.00 to 6.00 , at June 30, 2024 will remain at 2.00 and thereafter will remain at 1.75 . In February 2024, the Company paid $ 1.7 million, inclusive of a $ 0.1 million pre-payment penalty to Whitehawk to maintain compliance with the borrowing base covenant calculation as of January 31, 2024. After the payment, the Company was in compliance with the borrowing base covenant. On April 19, 2024, the Company entered into a sixth amendment to the Credit Agreement with the Collateral Agent and Lender (the “Sixth Amendment”). The Sixth Amendment provided the Company with an additional $ 2 million working capital bridge loan in April 2024, and an additional $ 3 million working capital bridge loan in June 2024, of which $ 2 million was advanced to the Company. The Company was required to pay a fee equal to 6 % of the aggregate amount of borrowings under the Sixth Amendment (i.e. $ 4.0 million). Both working capital bridge loans, including the related fee were paid in full by November 2024, and were not subject to prepayment penalties. On August 12, 2024, the Company entered into a seventh amendment to the Credit Agreement with the Collateral Agent and Lender (the “Seventh Amendment”) to (i) reduce the intellectual property sublimit under the borrowing base from $ 15.0 million to $ 11.2 million, and (ii) waive the event of default that may have arisen directly as a result of the Financial Covenant Default (as defined in the Seventh Amendment) at June 30, 2024. On November 14, 2024, the Company obtained a waiver for the Credit Agreement from the Collateral Agent and Lender (the “November 2024 Waiver”) to waive any events of default that may have arisen directly as a result of (i) the Financial Covenant Default (as defined in the November 2024 Waiver) at September 30, 2024 and (ii) the Borrowing Base Default (as defined in the November 2024 Waiver) for the month ended October 31, 2024. In conjunction with obtaining the waiver, the Company paid down approximately $ 1.1 million under the Credit Agreement, inclusive of $ 60 thousand of prepayment penalties. The Company was not in compliance with the Senior Leverage Ratio covenant at December 31, 2024, and was not in compliance with the borrowing base covenant for the months ended December 31, 2024, January 31, 2025, and February 28, 2025. On March 24, 2025, the Company entered into an eighth amendment to the Credit Agreement with the Collateral Agent and Lender (the “Eighth Amendment”) to (i) provide the Company with an additional $ 2.5 million working capital bridge loan in March 2025 and (ii) waive any events of default that may have arisen directly as a result of (1) the Financial Covenant Event of Default (as defined in the Eighth Amendment) for the periods ended December 31, 2024 and March 31, 2025 and (2) the Borrowing Base defaults described in the Eighth Amendment for the months ended December 31, 2024, January 31, 2025 and February 28, 2025. In addition, no payments were required to be made by the Company to pay down the borrowing base defaults for December 2024, January 2025, and February 2025. The Company is required to pay a fee equal to 6 % of the working capital bridge loan under the Eighth Amendment. The bridge loan, including the related fee, was due and payable in full on August 31, 2025. In conjunction with obtaining the Eighth Amendment, the Company also was required to comply with the following covenants: • Initiate recapitalization efforts and/or other financing arrangements with target completion milestones starting on March 21, 2025 through an expected completion of the recapitalization and/or repayment of the debt by June 16, 2025 (the “Recapitalization Requirement”). Not meeting these dates was an event of default under the credit facility. The Company did not meet this requirement. • Provide budgets to the Lender with variances in excess of specified thresholds resulting in an event of default at the discretion of the Lender. The Company is also required to meet with a financial advisor, as designated by the Lender, if requested. The Company’s noncompliance with its financial covenant related to the borrowing base under the Credit Agreement at March 31, 2025 was cured by the payment of approximately $ 1.3 million under the Credit Agreement in April and May 2025. The Company applied these payments to the bridge loan and related fee. In addition, the Eighth Amendment prohibits the Company from paying dividends or distributions to the preferred stockholders and reduces the borrowing base calculations by reducing the value assigned to its intellectual property to $ 11.2 million. F-26 On August 13, 2025, the Company entered into a forbearance agreement and ninth amendment and waiver to the Credit Agreement with the Collateral Agent and Lender (the “Ninth Amendment”) to waive any events of default that may have arisen directly as a result of (1) the Financial Covenant Event of Default (as defined in the Ninth Amendment) for the period ended June 30, 2025, (2) the Borrowing Base defaults described in the Ninth Amendment for the months ended April 30, 2024, May 31, 2025, June 30, 2025, and July 31, 2025, and (3) the failure to comply with the Recapitalization Requirement. Pursuant to the Ninth Amendment, the Company agreed to increase its quarterly principal payment due on September 30, 2025 from the scheduled $ 0.7 million to $ 1.0 million and to change interest payments from being due quarterly to being due monthly beginning in August 2025. The Company was not in compliance with the Senior Leverage Ratio covenant as of September 30, 2025 and was not in compliance with the borrowing base covenant for the months ended August 31, 2025 through November 30, 2025. On December 2, 2025, the Company entered into the tenth amendment to Credit Agreement with the Collateral Agent and Lender (the “Tenth Amendment”). The Tenth Amendment does not modify that maturity date. Pursuant to the Tenth Amendment, the Lenders agreed to waive certain “Specified Events of Default” that had occurred or were anticipated to occur under the Credit Agreement. These Specified Events of Default included: • Failure to maintain the required Senior Leverage Ratio of 1.75 :1.00 for the period ended September 30, 2025; and • Borrowing base non-compliance for the months ending July 31 through November 30, 2025. • The Lenders waived the right to receive the post-default interest rate with respect to these Specified Events of Default through December 31, 2025, provided the Company complies with the terms of the Tenth Amendment. Although the Company obtained waivers with respect to the foregoing past instances of Credit Agreement noncompliance, in view of the Company’s history of noncompliance and its current situation, there can be no guarantee that the Company will not breach provisions of the Credit Agreement in the future, which could lead to declared events of default, acceleration of obligations, and other material negative consequences. On December 18, 2025, the Company entered into a forbearance agreement and eleventh amendment and waiver to the Credit Agreement with the Collateral Agent and Lender (the “Eleventh Amendment”). The Eleventh Amendment extended the final maturity date of the loans from December 31, 2025 to April 1, 2027, and suspended mandatory quarterly amortization payments on the initial term loan through June 30, 2026, with the first payment thereafter due September 30, 2026. The Applicable Margin remains at 6.50 % for SOFR loans and 5.50 % for reference rate loans, and the Reference Rate was amended to 5.50 % per annum from the prior 5.25 % per annum. In conjunction with the Eleventh Amendment, the Senior Leverage Ratio covenant was replaced with a Minimum Consolidated Adjusted EBITDA covenant commencing with the period ending March 31, 2026 (set at $ 1.9 million), the Company is required to maintain a minimum qualified cash of $ 1.5 million, and certain business, management, and governance covenants were added. The Eleventh Amendment also requires that 50 % (or 100 % if an event of default exists) of net cash proceeds from equity offerings and certain permitted additional indebtedness be applied to prepay Credit Agreement loans, with the loan parties permitted to retain up to $ 5.0 million for working capital and general corporate purposes, and permits borrowing base indebtedness in excess of maximum amounts not to exceed $ 4.0 million at December 31, 2025, $ 4.5 million at January 31, 2026, $ 5.5 million at February 28, 2026, and $ 4.0 million from and after March 31, 2026. The Company was in compliance with the borrowing base covenant and the minimum qualified cash balance requirement under the Credit Agreement for the period ended December 31, 2025. Pursuant to the Eleventh Amendment, the Senior Leverage Ratio covenant was replaced with a minimum consolidated adjusted EBITDA covenant commencing with the period ending March 31, 2026. Pursuant to the March 2026 Forbearance Agreement, the Lenders waived the underlying borrowing base defaults for January and February 2026. As such, the debt outstanding from Boxlight to Whitehawk is classified as Long-Term debt in the financial period ended December 31, 2025. Although the Company has obtained waivers and amendments with respect to each of the foregoing instances of non-compliance, there can be no guarantee that the Company will not breach provisions of the Credit Agreement in the future. Any such breach could result in declared events of default, acceleration of obligations, and other material adverse consequences to the Company. Issuance Cost and Warrants In conjunction with its receipt of the Initial Loan, the Company issued to the Lender (i) 2,201 shares of Class A common stock (the “Shares”), which Shares were registered pursuant to its existing shelf registration statement and were delivered to the Lender in January 2022, (ii) a warrant to purchase 8,514 shares of Class A common stock (subject to F-27 increase to the extent that 3 % of any Series B and Series C convertible preferred stock converted into Class A common stock), exercisable at $ 480.00 per share (the “Warrant”), which Warrant was subject to repricing on March 31, 2022 based on the arithmetic volume weighted average prices for the 30 trading days prior to September 30, 2022, in the event the Company’s stock is then trading below $ 480.00 per share, (iii) a 3 % fee of $ 1,800,000 , and (iv) a $ 500,000 original issue discount. In addition, the Company agreed to register for resale the shares issuable upon exercise of the Warrant. The Company also incurred agency fees, legal fees, and other costs in connection with the execution of the Credit Agreement totaling approximately $ 1.7 million. Under the terms of the warrant issued to Whitehawk on December 31, 2021, the exercise price of the warrants would reprice if the stock price on March 31, 2022 was less than the original exercise price, at which time the number of warrants would also be increased proportionately, so that after such adjustment the aggregate exercise price payable for the increased number of warrant shares would be the same as the aggregate exercise price previously in effect. The warrants repriced on March 31, 2022 to $ 285.60 per share and the shares increased to 14,309 . On July 22, 2022, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with an accredited institutional investor. According to the terms of the Credit Agreement, as amended, the Purchase Agreement triggered a reduction of the exercise price of the warrants and a revaluation of the derivative liability. The Whitehawk warrants were repriced to $ 264.00 , and shares increased to 15,480 . On February 19, 2025, the Company entered into a Securities Purchase Agreement (the “2025 Purchase Agreement”) with certain institutional accredited investors (the “2025 Investors”). According to the terms of the Credit Agreement, as amended, the Purchase Agreement triggered a reduction of the exercise price of the warrants and a revaluation of the derivative liability. The Whitehawk warrants were repriced to $ 116.34 , and shares increased to 35,121 . On September 23, 2025, the Company entered into a Securities Purchase Agreement with certain institutional accredited investors. The Whitehawk warrants were repriced to $ 90.66 per share, and the number of shares issuable upon exercise increased to 45,077 shares. Paycheck Protection Program Loan On May 22, 2020, the Company received loan proceeds of $ 1.1 million under the Paycheck Protection Program. During 2021, the Company applied for forgiveness in the amount of $ 836 thousand. On March 2, 2022, the Company received a decision letter from the lender that the forgiveness application had been approved, leaving a remaining balance of $ 173 thousand to be paid. The Company received a payment schedule from the lender on May 5, 2022, extending the payoff date until May 2025 and bears 1 % interest. As of December 31, 2025, the outstanding balance under the loan was zero . Debt Maturity Principal repayments to be made during the next five years on the Company’s outstanding debt facilities at December 31, 2025, are as follows (in thousands): 2026 $ 1,274 2027 32,877 2028 — 2029 — 2030 — Total $ 34,151 On December 18, 2025, the Company, its subsidiaries, and Whitehawk Capital Partners LP entered into the Eleventh Amendment to the Credit Agreement. The final maturity date of the term loans was extended from December 31, 2025, to April 1, 2027. As of December 31, 2025, the Company reclassified $ 32.9 million of its short-term debt to long-term debt due to its maturity date being beyond the next 12 months. NOTE 10 – DERIVATIVE LIABILITIES The Company determined that certain warrants to purchase common stock do not satisfy the criteria for classification as equity instruments due to the existence of certain net cash and non-fixed settlement provisions that are not F-28 within the sole control of the Company. Conversion and exercise prices may be lowered if the Company issues securities at lower prices in the future. Such warrants are measured at fair value at each reporting date, and the changes in fair value are included in determining net income (loss) for the period. The Company used a Model Monte Carlo Simulation model to determine the fair value of the derivative liabilities. December 31, 2025 Common stock issuable upon exercise of warrants 45,077 Market value of common stock on measurement date $ 1.70 Exercise price $ 90.66 Risk free interest rate (1) 3.42 % Expected life in years 1 year Expected volatility (2) 187.0 % Expected dividend yields (3) — % December 31, 2024 Common stock issuable upon exercise of warrants 15,480 Market value of common stock on measurement date $ 11.40 Exercise price $ 264.00 Risk free interest rate (1) 4.17 % Expected life in years 2 years Expected volatility (2) 80.0 % Expected dividend yields (3) — % __________________________________________ (1) The risk-free interest rate was determined using the applicable Treasury Bill as of the measurement date. (2) The historical trading volatility for 2025 and 2024 was based on historical fluctuations in stock price for Boxlight. (3) The Company does not expect to pay a dividend in the foreseeable future. The following table shows the change in the Company’s derivative liabilities for the years ended December 31, 2025 and 2024: Amount (in thousands) Balance, December 31, 2024 $ 1 Exercise of warrants — Issuance of warrants — Change in fair value of derivative liabilities 4 Balance, December 31, 2025 $ 5 Amount (in thousands) Balance, December 31, 2023 $ 205 Exercise of warrants — Issuance of warrants — Change in fair value of derivative liabilities ( 204 ) Balance, December 31, 2024 $ 1 F-29 The following table shows the change in the Company’s related party derivative liabilities for the year ended December 31, 2025: Amount (in thousands) Balance, December 31, 2024 $ — Initial recognition of related party derivative liability on November 3, 2025 265 Change in fair value of related party derivative liability 211 Balance, December 31, 2025 $ 476 The related party derivative liability was recognized as a result of the conversion feature embedded in the Amended and Restated Inventory Finance Agreement with J.J. Astor & Co. dated November 3, 2025, which was accounted for separately at fair value and remeasured at December 31, 2025 . The following table presents the change in the Company’s common warrant liabilities for the year ended December 31, 2025: Amount (in thousands) Balance, December 31, 2024 $ — Issuance during the year 3,396 Change in fair value ( 1,394 ) Balance, December 31, 2025 $ 2,002 The common warrant liability was recognized in connection with warrants issued during the year ended December 31, 2025. The warrants were initially recorded at fair value on the issuance date and were remeasured at fair value at December 31, 2025. NOTE 11 – INCOME TAX In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740), which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The new guidance requires consistent categorization and greater disaggregation of information in the rate reconciliation, as well as further disaggregation of income taxes paid. This change is effective for annual periods beginning after December 15, 2024. The company is adopting the new standard on a prospective basis. In November 2024, the FASB issued ASU 2024-03, Income Statement-reporting Comprehensive Income- Expense Disaggregation Disclosures (Subtopic 220-40), which improves the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, SG&A, and research and development). This change is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. This change will apply on a prospective basis to annual financial statements for periods beginning after the effective date. However, retrospective application in all prior periods presented is permitted. The Company is currently evaluating the impact of this ASU on its financial statements. Pretax income (loss) resulting from domestic and foreign operations is as follows (in thousands): 2025 2024 United States $ ( 22,061 ) $ ( 19,382 ) United Kingdom ( 5,400 ) ( 11,185 ) Other Foreign Jurisdictions 2,731 323 Total Pretax Book Loss $ ( 24,730 ) $ ( 30,244 ) F-30 The components of income tax (benefit) expense at December 31, 2025 and December 31, 2024, are as follows (in thousands): 2025 2024 Current: Federal $ 13 $ ( 23 ) State 6 55 Foreign 1,435 875 Total Current $ 1,454 $ 907 Deferred: Federal $ — $ — State — — Foreign ( 2,374 ) ( 2,816 ) Total Deferred $ ( 2,374 ) $ ( 2,816 ) Total $ ( 920 ) $ ( 1,909 ) Disaggregating Income Tax Disclosures In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which applies to all entities subject to income taxes. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. Following is a reconciliation of the amount of income tax expense (benefit) from continuing operations and the amount computed by multiplying earnings before income taxes by the United States federal statutory income tax rate based on the newly adopted disclosure requirements under ASU 2023-09, Improvements to Income Tax Disclosures for the year ended December 31, 2025. The reconciliation of the provision for income taxes at the United States Federal statutory rate compared to the Company’s income tax expense as reported is as follows (in thousands): F-31 2025 Amount Percent of Pretax Loss US Federal Statutory Income Tax Rate $ ( 5,193 ) 21.0 % Domestic Federal Non-taxable or Nondeductible Items ( 4 ) — % Cross Border Tax Laws 531 ( 2.1 ) % Other Reconciling Items ( 150 ) 0.6 % Change in Tax Laws/Rates 91 ( 0.4 ) % Change in Valuation Allowance 5,288 ( 21.4 ) % Domestic State Income Taxes, net of Federal Effect* ( 1,272 ) 5.1 % Foreign tax effects United Kingdom GAAP Fx Reversal ( 521 ) 2.1 % Intercompany Dividend ( 637 ) 2.6 % Other ( 19 ) 0.1 % Netherlands — % Intercompany Dividend 657 ( 2.7 ) % Other 51 ( 0.2 ) % Other Foreign Entities 246 ( 1.0 ) % Prior Period True-ups — % Change in Unrecognized Tax Benefits 12 — % Total Income Tax (Benefit) $ ( 920 ) *State and local taxes in California, Georgia, and Wisconsin made up the majority (greater than 50 percent) of the tax effect in this category. Following is a supplemental disclosure of cash flow information related to income taxes paid based on the newly adopted disclosure requirements under ASU 2023-09, Improvements to Income Tax Disclosures for the year ended December 31, 2025 (in thousands): 2025 US Federal $ — US State and Local* $ 35 Foreign United Kingdom 336 Netherlands 877 Other Foreign jurisdictions 108 Total Foreign Jurisdictions $ 1,321 Total $ 1,356 *The company is not disaggregating the state income taxes due to immateriality of the overall state payments Following is a reconciliation of the amount of income tax expense (benefit) from continuing operations and the amount computed by multiplying earnings before income taxes by the United States federal statutory income tax rate for the years ended December 31, 2024, prior to adopting disclosure requirements under ASU 2023-09, Improvements to Income Tax Disclosures (in thousands): F-32 2024 Loss before income taxes $ ( 30,244 ) Income tax benefit computed at the statutory rate ( 6,351 ) State income taxes-net of federal tax benefit 35 Foreign tax rate differential ( 474 ) Foreign currency adjustment 1 GILTI inclusion 404 Meals 43 Stock compensation 146 Other book-tax differences 286 Adjustments to prior periods – temporary differences 693 Rate changes and differentials ( 750 ) Change in valuation allowance 4,058 Income tax (benefit) expense $ ( 1,909 ) Following is a supplemental disclosure of cash flow information related to income taxes paid for the year ended December 31, 2024, prior to adopting disclosure requirements under ASU 2023-09, Improvements to Income Tax Disclosures (in thousands): 2024 Cash paid during the year for Income Taxes $ 3,193 Tax effects of temporary differences at December 31, 2025 and December 31, 2024 are as follows (in thousands): F-33 Deferred tax assets: 2025 2024 Fixed assets $ 109 $ 51 Allowance for bad debts 683 1,022 Inventory 365 408 R&D amortization 1,414 1,650 Accrued expenses 61 48 Deferred revenue 6,010 5,960 Stock compensation 145 108 Right of use liability 234 327 Other 191 97 Interest expense limitation 11,236 8,770 Net operating loss carry-forwards 10,271 6,736 Deferred tax assets $ 30,719 $ 25,177 Valuation allowance ( 27,574 ) ( 22,231 ) Deferred tax assets, net $ 3,145 $ 2,946 Deferred tax liabilities: 2025 2024 Intangible assets ( 292 ) ( 2,019 ) Accrued expenses ( 1,139 ) ( 1,277 ) Prepaid expenses ( 39 ) ( 47 ) Right of use asset ( 203 ) ( 353 ) Other — ( 151 ) Deferred tax liabilities $ ( 1,673 ) $ ( 3,847 ) Deferred tax assets (liabilities), net $ 1,472 $ ( 901 ) Uncertain Tax Positions In the normal course of business, the Company’s tax returns are subject to examination by various taxing authorities. Such examinations may result in future tax and interest assessments by these taxing jurisdictions. Accordingly, the Company accrues liabilities when it believes that it is not more likely than not that it will realize the benefits of tax positions that it has taken in its tax returns or for the amount of any tax benefit that exceeds the cumulative probability threshold in accordance with ASC 740-10. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits in income tax expense (benefit). Differences between the estimated and actual amounts determined upon ultimate resolution, individually or in the aggregate, are not expected to have a material adverse effect on the Company’s consolidated financial position but could possibly be material to the Company’s consolidated results of operations or cash flow in any given quarter or annual period. As of December 31, 2025, the Company’s gross amount of unrecognized tax benefits is $ 165,000 , excluding interest and penalties. If the Company were to prevail on all uncertain tax positions, of the unrecognized benefits would affect the Company’s effective tax rate, exclusive of any benefits related to interest and penalties. F-34 A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Unrecognized tax benefits: 2025 2024 Balance as of January 1 $ 165 $ 165 Additions — — Reductions — — Balance as of December 31 $ 165 $ 165 As of December 31, 2025 and 2024, the Company has $ 165 thousand and $ 165 thousand, respectively, accrued for interest and penalties, excluding any federal tax benefit from interest deductions where applicable. During the years ended December 31, 2025 and 2024 , the Company accrued interest and penalties through income tax expense of $ 12 thousand and $ 26 thousand, respectively. The Company operates in the United States, United Kingdom and other jurisdictions. Income taxes have been provided based upon the tax laws and rates of the countries in which operations are conducted and income is earned. The cumulative U.S. Federal net operating losses carryforward on tax basis income was approximately $ 30.1 million and $ 20.4 million at December 31, 2025 and 2024, of which $ 6.1 million will expire between December 31, 2036 and December 31, 2037 and $ 24.0 million will carryforward indefinitely. The cumulative U.S. state net operating losses carryforward was approximately $ 46.7 million and $ 46.6 million at December 31, 2025 and 2024, respectively. The cumulative foreign net operating losses carryforward was $ 2.6 million and $ 2.6 million at December 31, 2025 and 2024, respectively. The legacy Boxlight entities are in a net deferred tax asset position in the United States, the United Kingdom, and other jurisdictions are primarily driven by the aforementioned net operating losses. The recoverability of these deferred tax assets depends on the Company’s ability to generate taxable income in the jurisdiction to which the carryforward applies. It also depends on specific tax provisions in each jurisdiction that could impact utilization. The Company has evaluated both positive and negative evidence as to the ability of its legacy entities in each jurisdiction to generate future taxable income. Based on its long history of cumulative losses in those jurisdictions, it believes it is appropriate to maintain a full valuation allowance on the net deferred tax asset of its legacy Boxlight entities at December 31, 2025 and 2024. The change in its valuation allowance during 2025 is approximately $ 5.3 million. The Company completed an IRC Sec. 382 analysis during the second quarter of 2024 and determined that it underwent an ownership change. This caused a limit on the net operating losses generated before 2020. Due to the full valuation allowance on net operating loss carryovers, there is no impact to the financial statements as a result of this limitation. The company is still in process of preparing a 382 study for the period ending December 31, 2025. The tax years from 2009 to 2026 remain open to examination in the U.S. federal jurisdiction. The tax years from 2021 to 2025 remain open to examination in the U.K. Statutes of limitations vary in other immaterial jurisdictions. The Company has not identified any material uncertain tax positions at this time. The Organization for Economic Co-operation and Development (“OECD”) introduced Base Erosion and Profit Shifting (“BEPS”) Pillar 2 rules that impose a global minimum tax rate of 15%. Numerous countries, including European Union member states, have enacted or are expected to enact legislation to be effective as early as January 1, 2024, with general implementation of a global minimum tax rate by January 1, 2025. We are currently evaluating the potential impact of the rules on our consolidated financial statements and related disclosures. The company does not except significant tax implications from the BEPS implications. NOTE 12 – EQUITY Preferred Shares The Company’s articles of incorporation, as amended provide that the Company is authorized to issue 50,000,000 shares of preferred stock consisting of: 1) 250,000 shares of non-voting Series A preferred stock, with a par value of $ 0.0001 per share; 2) 1,586,620 shares of voting Series B preferred stock; 3) 0 shares of voting Series C preferred stock; and 4) Remaining shares of “blank check” preferred stock as may be designated from time to by the Company’s board of directors. Each authorized series of preferred stock is described below. F-35 Issuance of preferred shares Series A Preferred Stock At the time of the Company’s initial public offering, 250,000 shares of the Company’s non-voting convertible Series A preferred stock were issued to Vert Capital for the acquisition of Genesis. As of December 31, 2025, a total of 167,972 shares of Series A preferred stock remained outstanding which can be converted into 6,693 shares of Class A common stock, at the discretion of the Series A stockholder. Series B Preferred Stock and Series C Preferred Stock On September 25, 2020, in connection with the acquisition of Sahara, the Company issued 1,586,620 shares of Series B Preferred Stock and 1,320,850 shares of Series C Preferred Stock. The Series B Preferred Stock has a stated and liquidation value of $ 10.00 per share and pays a dividend out of the earnings and profits of the Company at the rate of 8 % per annum, payable quarterly. The Series B Preferred Stock is convertible into the Company’s Class A common stock at a conversion price of $ 66.40 which was the closing price of BOXL’s Class A common stock on the Nasdaq stock market on September 25, 2020 (the “Conversion Price”) either (i) at the option of the holder at any time after January 1, 2024 or (ii) automatically upon the Company’s Class A common stock trading at 200 % of the Conversion Price for 20 consecutive trading days (based on a volume weighted average price). The Series C Preferred Stock has a stated and liquidation value of $ 10.00 per share and is convertible into the Company’s Class A common stock at the Conversion Price either (i) at the option of the holder at any time after January 1, 2026 or (ii) automatically upon the Company’s Class A common stock trading at 200 % of the Conversion Price for 20 consecutive trading days (based on a volume weighted average price). To the extent not previously converted into the Company’s Class A common stock, the outstanding shares of Series B Preferred Stock were to be redeemable at the option of the Holders at any time or from time to time commencing on January 1, 2024, upon thirty ( 30 ) days prior written notice to the Holders, for a redemption price, payable in cash, equal to sum of (a) Ten ($ 10.00 ) multiplied by the number of shares of Series B Preferred Stock being redeemed (the “Redeemed Shares”), plus (b) all accrued and unpaid dividends, if any, on such Redeemed Shares. The Series C Preferred Stock Shares were also subject to redemption on the same terms commencing January 1, 2026. On October 1, 2025, the Company converted all outstanding Series C preferred stock into common stock and amended the Series B preferred stock to eliminate redemption and conversion features, reducing potential future cash obligations. Pursuant to the Agreement, the holders converted all outstanding shares of Series C Stock—constituting a total of 1,320,850 shares - into a total of 198,920 shares of Class A Common Stock, par value $ 0.0001 per share (“Common Stock”). In addition, the holders agreed with the Company to amend the terms of the Series B Stock. Specifically, the right of the holders to convert their Series B Stock into Common Stock at their option, and a provision that provided for automatic conversion if the price of the Common Stock on the Nasdaq Capital Market reached a certain level, were eliminated. The right of the holders to cause the Company to redeem their Series B Stock at their option was also eliminated. The dividend provisions of the Series B Stock were amended to provide that the current 8 % per annum dividend, currently accruing on a non-compounding cumulative basis, would begin accruing at 9 % per annum on October 2, 2027, 10 % on October 2, 2028, 11 % on October 2, 2029 and 12 % on October 2, 2030 and thereafter. The cumulative dividends are payable only when and if declared, or in the event of a liquidation of the Company. No dividends can be declared or paid on junior classes of capital stock, including the Common Stock, unless unpaid cumulative dividends on the Series B Stock are first paid. Although the dividends are payable only when and if declared or upon a liquidation, dividends that do become payable but remain unpaid will accrue interest at a fixed rate of 12 % until such dividend and interest shall be paid in full. In the Agreement, the Company agreed to apply up to 20 % of the net proceeds of future primary equity securities offerings undertaken by the Company for capital-raising purposes to redeem or repurchase the Series B Stock at a redemption price per share of $ 10.00 until all such shares are redeemed and repurchased. The obligation to repurchase or redeem the Series B Stock is subject to possible limitations based on legal or stock market listing standard considerations. F-36 The Company previously disclosed that it was not in compliance with certain listing requirements of the Nasdaq Stock Market and that Nasdaq had granted it until October 6, 2025, to evidence compliance with the listing requirements or it may be delisted from Nasdaq. On October 3, 2025, the Company announced that it believed that it had met the listing requirements. On October 8, 2025, Nasdaq informed the Company that it had determined that the Company complies with Nasdaq Listing Rules relating to minimum stockholders’ equity, independent directors, and audit committee requirements with which it previously did not comply. Nasdaq further noted that it will continue to monitor the Company’s compliance with the minimum stockholders’ equity and, if at the time of its next periodic report the Company does not comply, the Company may be subject to delisting. On February 17, 2026, Dale Strang stepped down as Chief Executive Officer and member of the Board of Directors as part of a planned leadership transition. Mr. Strang’s departure was treated as a termination without "cause" under his Employment Agreement dated September 30, 2024. His resignation from the Board of Directors restored the Company’s compliance with the Nasdaq listing rule requiring that a majority of the Board of Directors consist of independent directors. Common Stock Following the Company’s 1-for-5 reverse stock split in February 2025 and its 1-for-6 reverse stock split in December 2025, the Company’s common stock consists of 4,166,667 shares of Class A voting common stock and 50,000,000 shares of Class B non-voting common stock. Class A and Class B common stock have the same rights except that Class A common stock is entitled to one vote per share while Class B common stock has no voting rights. Upon any public or private sale or disposition by any holder of Class B common stock, such shares of Class B common stock shall automatically convert into shares of Class A common stock. As of December 31, 2025 and December 31, 2024, the Company had 1,370,010 and 328,436 shares of Class A common stock issued and outstanding, respectively. No Class B shares were outstanding at December 31, 2025 and December 31, 2024. February 2025 Private Placement On February 19, 2025, the Company entered into a Securities Purchase Agreement (the “2025 Purchase Agreement”) with certain institutional accredited investors, pursuant to which the Company agreed to issue and sell, in a private placement priced at-the-market under the rules of The Nasdaq Stock Market (the “2025 Private Placement”), an aggregate of (i) 43,333 shares (the “2025 Shares”) of the Company’s Class A common stock, (ii) prefunded warrants (the “2025 Prefunded Warrants”) to purchase up to an aggregate of 177,167 shares of Class A Common Stock (the “2025 Prefunded Warrant Shares”), and (iii) warrants (the “2025 Common Warrants” and, together with the 2025 Prefunded Warrants, the “2025 Warrants”) to purchase up to an aggregate of 220,500 shares of Class A Common Stock (the “2025 Common Warrant Shares” and, together with the 2025 prefunded warrant shares, the “2025 Warrant Shares”). The purchase price of each 2025 share and accompanying 2025 common warrant was $ 12.78 , and the purchase price of each 2025 prefunded warrant and accompanying 2025 common warrant was $ 12.78 . The 2025 Private Placement closed on February 21, 2025, and the Company issued the 2025 shares and executed and delivered the 2025 warrants. The gross proceeds from the 2025 Private Placement were approximately $ 2.8 million, before deducting placement agent fees and other private placement expenses. Each 2025 prefunded warrant has an initial exercise price of $ 0.0006 per share (subject to adjustments as set forth therein), is immediately exercisable upon issuance and will expire when exercised in full. Each 2025 common warrant has an initial exercise price of $ 12.78 per share (subject to adjustments as set forth therein), is exercisable six months following the date of issuance and will expire five and a half years from the date of issuance. Pursuant to the Purchase Agreement, the Company filed a registration statement on Form S-3 (the “Registration Statement”) with the Securities Exchange Commission (“SEC”) on April 7, 2025 to register the resale of the 2025 Shares and the 2025 prefunded warrant shares. The Registration Statement was declared effective by the SEC on April 24, 2025. Through December 31, 2025, the holders exercised all of the prefunded warrants. In addition, two of the holders of the 2025 common warrants exercised a total of 147,000 warrants with a total exercise price of $ 1.9 million. September 2025 Registered Direct Offering On September 23, 2025, the Company entered into a placement agency agreement with a placement agent and a securities purchase agreement with certain purchasers, pursuant to which the Company issued and sold, in a registered direct offering, an aggregate of 1,333,333 shares of the Company’s Class A common stock at a price of $ 3.00 per share. The offering closed on September 24, 2025. The gross proceeds to the Company were approximately $ 4.0 million, before deducting the Placement Agent’s fees and other offering expenses payable by the Company F-37 At-the-Market Offering (“ATM Program”) On October 16, 2025, the Company entered into a sales agreement with A.G.P./Alliance Global Partners, pursuant to which the Company could offer and sell shares of its Class A common stock, par value $ 0.0001 per share, having an aggregate offering price of up to $ 4.8 million, through an “at the market” offering program (“ATM Program”) in accordance with Rule 415(a)(4) under the Securities Act of 1933, as amended. During the year ended December 31, 2025, the Company sold 417,956 shares of its Class A Common Stock under the ATM Program for gross proceeds of approximately $ 1.06 million. The Company paid the sales agent commissions of 3.0 % of the gross proceeds, totaling approximately $ 0.03 million. In addition, the Company incurred professional and other offering expenses of approximately $ 0.37 million related to the ATM Program. After deducting commissions and offering expenses, the Company received net proceeds of approximately $ 0.66 million. Warrants The Company had equity warrants outstanding of 149,298 and 46,200 as of December 31, 2025 and December 31, 2024, respectively. 367 328,069 328,436 NOTE 13 – STOCK COMPENSATION The Company has issued grants under two equity incentive plans, both of which have been approved by the Company’s shareholders: (i) the 2014 Equity Incentive Plan, as amended (the “2014 Plan”), pursuant to which a total of 26,627 shares of the Company’s Class A common stock have been approved for issuance, and (ii) the 2021 Equity Incentive Plan (the “2021 Plan”), pursuant to which a total of 20,833 shares of the Company’s Class A common stock have been approved for issuance. Upon approval of the 2021 Plan in September 2021, any shares remaining available for issuance under the 2014 Plan were cancelled, and all future grants were issued under the 2021 Plan. The 2021 Plan allows for issuance of shares of our Class A common stock, whether through restricted stock, restricted stock units, options, stock appreciation rights or otherwise, to the Company’s officers, directors, employees, and consultants. Prior to the second quarter of 2023, the Company had issued 25,830 shares under the 2021 Plan such that the Company was over the authorized share number. Stock Options Under our Equity Incentive Plans, an employee may receive an award of stock grants that provides the opportunity in the future to purchase the Company’s shares at the market price of our stock on the date the award is granted (strike price). The options become exercisable over a range of immediately vested to four-year vesting periods and expire five years from the grant date, unless stated differently in the option agreements, if they are not exercised. We record compensation expense based on the estimated fair value of the awards which is amortized as compensation expense on a straight-line basis over the vesting period. Accordingly, total expense related to the award is reduced by the fair value of options that are forfeited by employees that leave the Company prior to vesting as they occur. F-38 Following is a summary of the option activities during the years ended December 31, 2025 and 2024: Number of Units Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding, December 31, 2023 11,615 $ 199.50 2.09 Granted — $ — Exercised — $ — Forfeited ( 977 ) $ 248.40 Expired ( 4,942 ) $ 199.20 Outstanding, December 31, 2024 5,696 $ 190.80 0.65 Granted — $ — Exercised — $ — Forfeited — $ 162.00 Expired ( 5,324 ) $ 168.15 Outstanding, December 31, 2025 372 $ 610.85 1.62 Exercisable, December 31, 2025 300 $ 610.85 1.62 As of December 31, 2025 and December 31, 2024, the stock options had no intrinsic value. Restricted Stock Units Under our Equity Incentive Plans, the Company may grant restricted stock units (“RSUs”) to certain employees, contractors, and non-employee directors. Upon granting the RSUs, the Company records a fixed compensation expense equal to the fair market value of the underlying shares of RSUs granted on a straight-line basis over the requisite service period for the RSUs. Compensation expense related to the RSUs is reduced by the fair value of units that are forfeited by employees that leave the Company prior to vesting as they occur. The restricted stock units vest over a range of immediately vested to four-year vesting periods in accordance with the terms of the applicable RSU grant agreement. The following is a summary of the restricted stock activities during the years ended December 31, 2025 and 2024. Number of Units Weighted Average Grant Date Fair Value Outstanding, December 31, 2023 13,398 $ 161.10 Granted 533 $ 31.20 Vested ( 4,938 ) $ 203.10 Forfeited ( 6,771 ) $ 109.80 Outstanding, December 31, 2024 2,222 $ 183.00 Granted 0 $ — Vested ( 1,223 ) $ 219.29 Forfeited ( 288 ) $ 153.11 Outstanding, December 31, 2025 711 $ 120.91 F-39 2024 Grants During the year ended December 31, 2024, the Company granted 533 RSUs to our now Chairman and former Chief Executive Officer, Michael Pope, in conjunction with his transition to a non-executive member of the Board of Directors. Warrants The following is a summary of the warrant activities during the years ended December 31, 2025 and 2024: Number of Units Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding, December 31, 2023 46,200 $ 197.10 3.72 Granted — Exercised — Outstanding, December 31, 2024 46,200 $ 197.10 2.70 Granted 397,667 Contractual increase for share sales 29,598 Exercised ( 324,167 ) Outstanding, December 31, 2025 149,298 $ 67.27 1.53 Exercisable, December 31, 2025 149,298 $ 67.27 1.53 Stock compensation expense Long-term incentive plan On August 15, 2024, the Company granted a long-term incentive plan (LTIP) cash award pursuant to its 2021 Equity Incentive Plan to members of the Company’s Board of Directors and senior management. The amount of each award earned will depend on the performance of the Company relative to certain performance targets related to share price appreciation of the Company’s Class A common stock during the respective performance cycles. The LTIP awarded to the Company’s Board of Directors has a performance period ending on March 31, 2025, whereas the LTIP awarded to senior management has three consecutive 12-month performance periods ending June 30, 2025, June 30, 2026, and June 30, 2027. The target payout under the LTIP awarded to the Board of Directors and senior management is $ 420 thousand and $ 1.1 million, respectively. If the Company’s performance relative to the performance goal during the performance cycle is not equal to the performance target, the target Cash LTIP Award will be adjusted based on actual performance. T he Cash LTIP for the Board of Directors totaled $ 236 thousand and was paid in May 2025. The earned payout under the LTIP awarded to senior management was $ 225 thousand for the period ended June 30, 2025. The target payout for senior management over the remaining term is $ 89 thousand. At no time during the performance cycle shall the payout be less than 1/3 or exceed 3 times the target cash LTIP Award, unless a change of control has occurred. Cash payments are subject to the Company’s compliance with all covenants contained in the Company’s credit facilities in effect at the conclusion of each performance cycle. As amounts earned for the awards are based on changes in the Company’s stock price, the Company will recognize a liability for compensation cost each reporting period based on the fair value as of each reporting date proportionally with the elapsed time at each reporting period. The liability is recognized in other short-term liabilities in the consolidated balance sheets. The Company used a Model Monte Carlo Simulation model to determine the fair value of the LTIP as of December 31, 2025 to be $ 205 thousand. Key inputs to the valuation of the awards include the stock price F-40 as of the award’s effective date and the valuation date, the discount rate, and historical volatility in the Company’s stock price. December 31, 2025 Common stock issuable upon exercise of warrants Market value of common stock on measurement date $ 1.70 Risk free interest rate (1) 3.50 - 3.53 % Expected life in years 1.50 - 2.50 years Expected volatility (2) 101 - 187 % (1) The risk-free interest rate was determined by management using the applicable Treasury Bill as of the measurement date. (2) The historical trading volatility was based on historical fluctuations in stock price for Boxlight. For the years ended December 31, 2025 and 2024, the Company recorded the following stock compensation expense which is included in general and administrative expense in the Company’s consolidated statement of operations and comprehensive loss (in thousands): 2025 2024 Stock options $ 11 $ 68 Restricted stock units 262 962 Equity-based Warrants 30 1 Long-term incentive plan 165 358 Total stock compensation expense $ 468 $ 1,389 As of December 31, 2025, there was approximately $ 0.11 million of unrecognized compensation expense related to unvested options, RSUs, and warrants, which will be amortized over the remaining vesting period. Of that total, approximately $ 0.06 million is estimated to be recorded as stock compensation expense in 2026. In connection with the reverse stock split, proportionate adjustments were made to the number of shares of Class A common stock underlying the Company’s outstanding equity awards and equity incentive plans, as well as the applicable exercise or grant prices. Proportionate adjustments were also made to the Company’s outstanding warrants and the conversion rates of its convertible preferred stock. These adjustments did not result in any change to the aggregate intrinsic value of such awards or instruments immediately prior to and following the reverse stock split. NOTE 14 – OTHER RELATED PARTY TRANSACTIONS Management Agreements On November 1, 2022, the Company entered into a consulting agreement with Mark Elliott, former CEO of Boxlight and a current member of the board of directors. The agreement is for Mr. Elliott to provide sales, marketing, management and related consulting services to assist the Company in sourcing and entering into agreements with one or more customers to provide products and services for specified school districts. The Company will pay Mr. Elliott a fixed payment of $ 4 thousand per month and commissions equal to 15 % of gross profit derived by the Company based on total purchase order revenue. The agreement, unless cancelled, will automatically renew on December 31, 2025. For the years ended December 31, 2025 and 2024, the Company paid $ 137 thousand and $ 352 thousand under the agreement, respectively. On January 31, 2018, the Company entered into a management agreement (the “Management Agreement”) with an entity owned and controlled by our now Chairman and former CEO, Michael Pope. The Management Agreement was separate and apart from Mr. Pope’s employment agreement. The Management Agreement was effective as of the first day of the same month that Mr. Pope’s employment with the Company terminates, and for a term of 13 months, Mr. Pope will provide consulting services to the Company including sourcing and analyzing strategic acquisitions, assisting with financing activities, and other services. As consideration for the services provided, the Company will pay a management F-41 fee equal to 0.375 % of the consolidated net revenues of the Company, payable in monthly installments, not to exceed $ 250,000 in any calendar year. At his option, Mr. Pope may defer payment until the end of each year and receive payment in the form of shares of Class A common stock of the Company. On January 4, 2024, Mr. Pope’s employment with the Company terminated. In accordance with the Management Agreement, Mr. Pope is expected to continue providing consulting services to the Company for the subsequent 13 months, with such agreement terminating on February 2025. For the years ended December 31, 2025 and 2024, the Company paid $ 43 thousand and $ 250 thousand under the agreement. Mr. Pope continues to serve as a director of the Company. Inventory Finance Agreement On May 27, 2025, the Company entered into an Inventory Finance Agreement with J.J. ASTOR & CO., a Utah corporation ("J.J ASTOR”). Michael Pope is the chief executive officer of J.J ASTOR, which is beneficially owned, directly or indirectly, by a private investment fund managed by Mr. Pope. Under the Agreement, the Company may finance the purchase of certain finished goods inventory from one of the Company’s manufacturers and suppliers of such inventory up to an aggregate outstanding amount of $ 6 million. The term of the Agreement is one year . Each advance under the Agreement is payable by the Company within 90 days at a rate of 5.35 % of the amount advanced by J.J ASTOR. Title to the product remains with J.J. ASTOR until payment is made by the Company. Any failure by the Company to make a payment in full when due under the Agreement constitutes an event of default. In the event of such default by the Company, the aggregate outstanding balance owing to J.J ASTOR is automatically increased by 10 % and begins to accrue interest at the rate of 19 % per annum, compounded daily. On November 3, 2025, the Company and J.J. Astor entered into an amendment and restatement of the Agreement (the “Restated Agreement”). Under the Restated Agreement, the Company may finance 80 % of the purchase of certain finished goods inventory from one of the Company’s manufacturers and suppliers of such inventory up to an aggregate outstanding amount of $ 9 million, a $ 3 million increase from the maximum amount under the original Agreement. Each advance under the Restated Agreement remains payable by the Company within 90 days at a rate of $ 1.0535 per $0.80 advanced. The term of the Restated Agreement is until November 3, 2026, unless mutually extended or earlier terminated by J.J. Astor. Under the Restated Agreement, J.J. Astor may elect from time to time to convert all or a portion of the amounts owed by the Company into shares of the Company’s common stock, par value $ 0.001 per share. J.J. Astor can require the Company to register any such shares for public resale with the Securities & Exchange Commission. NOTE 15 – COMMITMENTS AND CONTINGENCIES Purchase Commitments The Company is legally obligated to fulfill certain purchase commitments made to vendors that supply materials used in the Company’s products. At December 31, 2025 the total amount of such open inventory purchase orders was $ 18.3 million. Inventory Financing Arrangement On November 3, 2025, we entered into an amended and restated inventory finance agreement with J.J. Astor & Co. (the “Inventory Purchaser”), pursuant to which the Inventory Purchaser may, from time to time, finance up to $ 9.0 million of our finished goods inventory purchases from our contract manufacturers. Under this arrangement, we are required to pay a deposit equal to 20 % of the purchase price of the applicable inventory, and the Inventory Purchaser funds the remaining balance directly to the supplier and takes title to the inventory. We have determined that this arrangement results in the recognition of the financed inventory and a corresponding financing obligation on our consolidated balance sheets, as the risks and rewards of ownership are substantially retained by us during the financing period. Accordingly, financed inventory is included within inventories, net of reserves, and the related payment obligations are presented as related party accounts payable on our consolidated balance sheets. F-42 For each inventory purchase financed under the agreement, we are obligated to pay the Inventory Purchaser an amount equal to the funded purchase amount plus a contractual premium within 90 days of the funding date. The agreement also requires us to pay monthly monitoring fees and provides for additional fees based on unused financing availability. In the event we fail to satisfy our payment obligations when due, the Inventory Purchaser may accelerate amounts owed, impose default interest and penalties, and sell the inventory collateral. We would remain liable for any deficiency resulting from such sale. The agreement further provides the Inventory Purchaser with the right, at its election, to convert certain outstanding payment obligations into shares of our Class A common stock, subject to ownership limitations and other contractual restrictions. As of December 31, 2025, the aggregate outstanding obligation under this arrangement was $ 3.7 million, recorded as related party accounts payable on our consolidated balance sheet. This arrangement represents a form of short-term inventory financing and exposes us to material liquidity, cash flow, and operational risks. On April 1, 2026, we entered into an amendment to the inventory finance agreement, pursuant to which $ 556,200 of the outstanding balance was converted into 600,000 shares of common stock (the “Conversion Shares”) at a conversion price of $ 0.927 per share. Further, the parties agreed that, if the aggregate proceeds from the sale of the Conversion Shares are less than $ 556,200 , the Company shall pay the shortfall in cash within five trading days. Michael Pope, Chairman of the Company’s Board of Directors, and its former president and chief executive officer, is the chief executive officer of J.J. Astor. J.J. Astor is beneficially owned, directly or indirectly, by a private investment fund managed by Mr. Pope. Legal Proceedings From time to time, the Company is involved in routine litigation and legal proceedings in the ordinary course of its business, such as employment matters and contractual disputes. Currently, there is no pending litigation or proceedings that the Company’s management believes will have a material effect, either individually or in the aggregate, on its business or financial condition. NOTE 16 – CUSTOMER AND SUPPLIER CONCENTRATION Significant customers and suppliers are those that account for greater than 10% of the Company’s revenues and purchases. For the years ended December 31, 2025 and December 31, 2024, the Company’s revenues were not concentrated with one or more customers. For the years ended December 31, 2025 and December 31, 2024, the Company’s purchases were concentrated among one vendor. Vendor Total purchases from the vendor as a percentage of total cost of revenues for the year ended December 31, 2025 Accounts payable (prepayment) to the vendor as of December 31, 2025 (in thousands) Total purchases from the vendors as a percentage of total cost of revenues for the year ended December 31, 2024 Accounts payable (prepayment) to the vendors as of December 31, 2024 (in thousands) 1 39 % $ 13,007 51 % $ 16,059 The Company believes there are numerous other suppliers that could be substituted should the above supplier become unavailable or non-competitive. NOTE 17 - SEGMENTS Information about our Company’s operations by operating segment is shown in the following tables (in thousands): F-43 Year Ended December 31, 2025 Americas EMEA Rest of World Eliminations and Adjustments (1) Total Revenues, net $ 51,717 $ 58,355 $ 1,185 $ ( 2,011 ) $ 109,246 Less (2) Cost of sales 37,499 39,123 421 ( 1,426 ) 75,617 Segment gross profit 14,218 19,232 764 ( 585 ) 33,629 Less (2) General and administrative expenses 19,830 15,230 394 0 35,454 Depreciation and amortization 2,629 7,651 0 0 10,280 Research and development expenses 4,129 800 0 ( 660 ) 4,269 Interest expense 9,726 306 — — 10,032 Income tax (benefit) expense ( 1,239 ) 319 — — ( 920 ) Other segment items (3) ( 678 ) ( 739 ) 3 ( 262 ) ( 1,676 ) Net Loss $ ( 20,179 ) $ ( 4,335 ) $ 367 $ 337 $ ( 23,810 ) (1) Eliminations and adjustments represent net sales between the Americas, EMEA and Rest of World segments. Sales between these segments are generally valued at market. (2) The significant expense categories and amounts align with the segment-level information that is regularly provided to the Chief Operating Decision Maker. (3) Other Segment items for reach reportable segment includes: Research and development - consists primarily of personnel related costs, prototype and sample costs, design costs, and global product certifications mostly for wireless certifications. Other Expense - consists of interest expense associated with our debt financing arrangements, (gains) or losses on settlements of debt, and the effects of changes in the fair value of derivative liabilities. Year Ended December 31, 2024 Americas EMEA Rest of World Eliminations and Adjustments (1) Total Revenues, net $ 65,514 $ 73,858 $ 593 $ ( 4,072 ) $ 135,893 Less (2) Cost of sales 41,024 50,770 399 ( 3,241 ) 88,952 Segment gross profit 24,490 23,088 194 ( 831 ) 46,941 Less (2) General and administrative expenses 25,295 16,043 418 — 41,756 Depreciation and amortization 4,338 16,164 7 20 20,529 Research and development expenses 4,140 775 — ( 789 ) 4,126 Interest expense 10,243 9 — — 10,252 Income tax (benefit) expense ( 2,430 ) 585 - 64 — ( 1,909 ) Other segment items (3) ( 149 ) 594 — 77 $ 522 Net Loss $ ( 16,947 ) $ ( 11,082 ) $ ( 167 ) $ ( 139 ) $ ( 28,335 ) (1) Eliminations and adjustments represent net sales between the Americas, EMEA and Rest of World segments. Sales between these segments are generally valued at market. (2) The significant expense categories and amounts align with the segment-level information that is regularly provided to the Chief Operating Decision Maker. F-44 (3) Other Segment items for reach reportable segment includes: Research and development - consists primarily of personnel related costs, prototype and sample costs, design costs, and global product certifications mostly for wireless certifications. Other Expense - consists of interest expense associated with our debt financing arrangements, (gains) or losses on settlements of debt, and the effects of changes in the fair value of derivative liabilities. December 31, 2025 December 31, 2024 Identifiable Assets Americas $ 40,329 $ 50,318 EMEA 55,833 63,863 Rest of World 1,381 1,124 Total Identifiable Assets $ 97,543 $ 115,305 NOTE 18 – SUBSEQUENT EVENTS The Company evaluated subsequent events through the date the consolidated financial statements were issued. Executive departure On January 27, 2026, the Company implemented a planned leadership transition as part of its ongoing operational and strategic initiatives. In connection with this transition, Jens Holstebro stepped down from his role as Executive Vice President and General Manager of the Americas. Mr. Holstebro’s departure was treated as a termination without “cause” pursuant to his Employment Agreement dated February 26, 2024. Under the terms of the agreement, Mr. Holstebro is entitled to receive accrued obligations and severance benefits, including 12 months of base salary and certain continued benefits, subject to the terms of the agreement and his execution of a release of claims. The estimated severance and related obligations associated with this transition were accrued in the Company’s consolidated financial statements as of December 31, 2025. On February 17, 2026, Dale Strang stepped down as Chief Executive Officer and member of the Board of Directors as part of a planned leadership transition. Mr. Strang’s departure was treated as a termination without "cause" under his Employment Agreement dated September 30, 2024. Under the terms of his Employment Agreement, Mr. Strang is entitled to receive accrued obligations and severance benefits, including 12 months of base salary, any earned fiscal year 2026 annual cash incentive bonus, subject to the terms of the agreement and his execution of a release of claims. The estimated severance and related obligations associated with this transition were accrued in the Company’s consolidated financial statements as of December 31, 2025. NASDAQ Board Independence Listing Rule Mr. Strang’s resignation from the Board of Directors is expected to restore the Company’s compliance with the NASDAQ Listing Rule requiring a majority of independent directors. At-the-Market Offering (“ATM Program”) Subsequent to December 31, 2025, the Company sold the remaining shares available under the “at the market offering” program (“ATM Program”). In total, the Company sold 2,472,070 shares of Class A Common Stock under the program for aggregate proceeds of approximately $ 4.6 million, after deducting sales agent commissions of $ 0.14 million but before offering expenses, thereby fully exhausting the capacity of the program. Potential-Tariff-Refunds The Company imports certain materials and products that are subject to U.S. government tariffs and import duties. Subsequent to year‑end, a federal court ordered the U.S. government to begin refunding certain tariffs. The Company believes that some of the tariffs it has paid may be eligible for refund; however, the amount and timing of any potential refunds are uncertain. Accordingly, the Company has not recorded any benefit related to possible tariff refunds. F-45 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None