What changed in this filing

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Item 1. Business

2026-03-12 compared with 2025-03-20 · 385 added, 296 removed, 197 unchanged (78% of the section changed)

Corporate Overview

are a robotics company developing advanced robotics and drone-based systems.

Our advanced robotic system enables remote, real-time, pinpoint

accurate firing of small arms and light weapons that can achieve pinpoint accuracy regardless of the movement of the weapons platform

or the target.

We also introduced an insulator cleaning drone, which is a drone technology for conducting routine maintenance of critical

infrastructure for cleaning electric utility cable insulators.

were founded in 2014 as Unlimited Aerial Systems, LLP (“UAS LLP”), and until the consummation of the Share Exchange Agreement

(as hereinafter defined), we were a developer and manufacturer of commercial unmanned aerial systems, or drones, intending to provide

a superior Quadrotor aerial platform at an affordable price point in the law enforcement and first responder markets.

March 9, 2020, we closed on the Share Exchange Agreement (the “Share Exchange Agreement”), under which Duke Robotics, Inc.,

a Delaware corporation (“Duke Inc.”) became our majority-owned subsidiary (the “Share Exchange”).

date is referred to as the “Effective Time.” As a result of the Share Exchange, the Company adopted the business plan of Duke

April 29, 2020, we, Duke Inc., and UAS Acquisition Corp., a Delaware corporation and our wholly-owned subsidiary (“UAS Sub”),

executed an Agreement and Plan of Merger (the “Merger Agreement”), under which UAS Sub was to merge, upon the satisfaction

of customary closing conditions, with and into Duke Inc., with Duke Inc.

surviving as our wholly-owned subsidiary (the “Short-Form

Under the Merger Agreement, we intended to acquire the remaining outstanding shares of Duke Inc.

held by those certain

shareholders who did not participate in the Share Exchange.

On June 25, 2020, Duke Inc.

filed a Certificate of Merger with the

State of Delaware, and consequently, Duke Inc.

became our wholly-owned subsidiary and the Short-Form Merger was consummated.

January 29, 2021, we, through Duke Airborne Systems Ltd.

(“Duke Israel”), and Elbit Systems Land Ltd., an Israeli corporation

(“Elbit”), entered into a collaboration agreement (the “Collaboration Agreement”) for the global marketing and

sales, and the production and further development of our developed advanced robotic system mounted on a UAS, armed with lightweight firearms,

which we market under the commercial name “TIKAD.”

August 15, 2022, Duke Israel introduced the Insulator Cleaning (“IC”) Drone, a drone technology for conducting routine maintenance

of critical infrastructure, and has signed an agreement with Israel Electric Corporation (the “IEC”) to provide drone-enabled

systems for cleaning electric utility cable insulators.

During October 2023, we completed our obligations under the agreement with

This was followed in August 2024, by a new agreement with the IEC to utilize our innovative IC Drone system for cleaning electric

utility cable insulators.

has a wholly-owned subsidiary, Duke Israel, which was formed under the laws of the State of Israel in March 2014 and became the sole

subsidiary of Duke Inc.

after its incorporation.

Our mailing address is 10 HaRimon Street, Mevo Carmel Science and Industrial Park, Israel

2069203, and our telephone number is 011-972-4-8124101.

We are a robotics company

developing advanced robotic and drone-based systems.

Our technologies include an advanced robotic stabilization system that enables remote,

real-time, pinpoint-accurate firing of small arms and light weapons, as well as civilian drone-based solutions focused on infrastructure

maintenance, which is a drone technology for conducting routine maintenance of critical infrastructure for electric utility insulator

Although our stabilization

technology was initially designed for use on unmanned aerial systems (“UAS”), our robotic solutions are adaptable to other

military platforms and civilian applications.

Corporate History and Structure

We were founded in 2014 as

Unlimited Aerial Systems, LLP (“UAS LLP”).

Prior to 2020, we operated as a developer and manufacturer of commercial unmanned

aerial systems, with a focus on providing quadrotor aerial platforms for law enforcement and first responder markets.

Duke Robotics Inc.

Inc.”) was formed in April 2016 and has a wholly owned Israeli subsidiary, Duke Airborne Systems Ltd.

(“Duke Israel”),

incorporated under the laws of the State of Israel.

Duke Israel’s principal offices are located at 10 HaRimon Street, Mevo Carmel

Science and Industrial Park, Israel 2069203, and our telephone number is +972-054-5707050.

Our website address is https://dukeroboticsys.com.

as of October 22, 2020, our Common Stock began to be quoted on the OTCQB tier Venture Market, under the symbol “USDR”.

October 28, 2024, we filed a certificate of amendment (the “Certificate of Amendment”) to our Articles of Incorporation with

the Nevada Secretary of State to change the Company’s corporate name from UAS Drone Corp.

to DUKE Robotics Corp.

effective as of

November 4, 2024.

connection with the Certificate of Amendment, we also filed an issuer notification form with the Financial Industry Regulatory Authority

(“FINRA”) reflecting our name change and requesting a change in our trading symbol from “USDR” to “DUKR”.

Effective as of market open on Monday, November 4, 2024, the name changed to DUKE Robotics Corp.

and the transition of our OTCQB ticker

symbol from “USDR” to “DUKR” took effect.

February 18, 2025, we announced that we established Duke Robotics Hellas M I.K.E (“Duke Greece”), a wholly owned subsidiary,

formed under the laws of Greece.

Company Overview

Until the consummation of

the Share Exchange, we were a developer and manufacturer of commercial unmanned aerial systems, or drones, with the goal of providing

a superior Quadrotor aerial platform at an affordable price point in the law enforcement and first responder markets.

Following the Share

Exchange, we adopted the business plan of Duke.

Duke is a robotics company dedicated to the development of an advanced robotics stabilization

system that enables remote, real-time, pinpoint accurate firing of small arms and light weapons as well as other civilian applications

with an emphasis on the field of infrastructure maintenance.

the first product has been designed to be used by an Unmanned Aerial System (a “UAS”), the robotic solutions are also adaptable

to other military vehicles, boats and stationary environments, as well as civilian purposes, such as our IC Drone solution.

that the system is to small arms and light weapons (e.g., weapons weighing less than 9 kilograms, or kg, or approximately 19.9 pounds)

as drones are to air-to-ground missiles.

Prior to marketing our

systems to potential defense and military customers, for security reasons, we are required to obtain various governmental approvals for

On January 29, 2021, we, through

Duke Israel, and Elbit, entered into the Collaboration Agreement for the global marketing and sales, and the production and further development

of our developed advanced robotic system mounted on an UAS, armed with lightweight firearms, which we market under the commercial name

“TIKAD.” Following the Collaboration Agreement, we have expanded our technology beyond military applications and continue

to explore additional uses for our technology and know-how.

Our commercialization efforts

in the civilian market are primarily focused in Europe, with secondary efforts focused on other global markets, including the United States.

On May 11, 2021, we entered

into securities purchase agreements with eight non-U.S.

investors (the “Investors”) in a private placement offering in which

we agreed to issue and sell an aggregate of:

On March 9, 2020, we completed

a share exchange transaction pursuant to which Duke Inc.

became our majority-owned subsidiary (the “Share Exchange”).

result of the Share Exchange, we adopted Duke Inc.’s business plan.

On April 29, 2020, we entered into an Agreement and Plan of

Merger with Duke Inc.

and our wholly owned subsidiary, UAS Acquisition Corp.

On June 25, 2020, Duke Inc.

filed a Certificate of Merger

with the State of Delaware, and the merger was consummated, resulting in Duke Inc.

becoming our wholly owned subsidiary.

On February 18, 2025, we established

Duke Robotics Hellas M I.K.E (“Duke Greece”), a wholly owned subsidiary formed under the laws of Greece.

On January 13, 2026,

Duke Greece received operational authorization from the Hellenic Civil Aviation Authority following completion of the Specific Operations

Risk Assessment (“SORA”) process under EU Regulation 2019/947.

This authorization enables IC Drone operations in Greece and

aligns the system with European Union regulatory standards.

Effective October 22, 2020,

our common stock began trading on the OTCQB Venture Market under the symbol “USDR.”

On October 28, 2024, we filed

a Certificate of Amendment to change our corporate name from UAS Drone Corp.

to DUKE Robotics Corp., effective November 4, 2024.

In connection

with the name change, our OTCQB trading symbol was changed from “USDR” to “DUKR,” effective November 4, 2024.

On March 4, 2026, we filed a Certificate of Change to effect a reverse

stock split of the Company’s issued and outstanding common shares, par value $0.0001 per share at a ratio of 25-for-1 (the “Reverse

Stock Split”), effective as of March 6, 2026.

The Company will trade under a new CUSIP Number, 90344820.

The Company’s Common Stock

began trading on the OTCQB on a post-split basis at the market open on March 6, 2026.

Following the Reverse Stock Split, the Company’s

ticker symbol on the OTCQB is traded under the symbol DUKRD for 20 trading days, in accordance with OTC Marketplace rules.

Business Strategy and Technology Focus

Following the Share Exchange,

we transitioned our strategic focus to advanced robotic stabilization systems for military and defense applications, while expanding into

civilian infrastructure maintenance solutions.

Our business activities are

focused on stabilized robotic systems for defense and homeland security applications and civilian drone-based solutions for infrastructure

inspection and maintenance.

Our commercialization efforts in the civilian market are primarily focused in Europe, with secondary efforts

in other global markets, including the United States.

Defense and Stabilized Weapons Systems

Elbit Collaboration

On January 29, 2021, Duke

Israel entered into a Collaboration Agreement with Elbit Systems Land Ltd.

(“Elbit”) for the global marketing and sales, and

the production and further development, of Duke’s stabilized weapons drone system mounted on a UAS, marketed under the commercial

name “TIKAD.” Under the Collaboration Agreement, Elbit markets and deploys the stabilized weapons drone system under the brand

name “Birds of Prey.” We are entitled to royalties from sales of this system in accordance with the terms of the agreement.

On April 2, 2025, we and Elbit

executed a Supplement Letter expanding the collaboration to allow us to market the stabilized weapons drone system to military, defense,

homeland security, and para-military customers, in coordination with Elbit.

We are entitled to receive a commission, in the mid-single

digit percentage range, from proceeds resulting from our marketing activities, in addition to royalties under the Collaboration Agreement.

On July 9, 2025, we announced that we expect to receive initial royalty revenues from sales of the Birds of Prey system.

On August 28, 2025, we announced

that the “Bird of Prey” stabilized weapons drone system was prominently featured in a comprehensive television report by Israel’s

Channel 14 News examining the Israel Defense Forces’ (“IDF”) advanced weaponized drone warfare capabilities.

The television

report provided rare insight into the IDF’s ’secretive drone units’ and their revolutionary combat methodologies that

have transformed modern battlefield operations, including in operational use throughout the “Iron Swords” war.

of Prey” system, which is developed and marketed as part of our strategic collaboration with Elbit was specifically highlighted

in the broadcast as part of the coverage showcasing advanced weaponized drone technologies currently deployed by the IDF.

The report documented

how these cutting-edge drone systems operate with “surgical precision” from the air, silently identifying, targeting, and

neutralizing threats while keeping soldiers out of harm’s way.

Civilian Infrastructure Solutions

Insulator Cleaning Drone (IC Drone)

On August 15, 2022, Duke Israel

introduced the Insulator Cleaning (“IC”) Drone, a drone-based system designed for routine maintenance of critical infrastructure,

including cleaning high-voltage electric utility cable insulators.

In August 2022, Duke Israel entered into an agreement with the Israel

Electric Corporation (“IEC”) to provide drone-enabled insulator cleaning systems.

In October 2023, we completed our obligations

under this agreement.

In August 2024, we entered

into a new commercial agreement with the IEC for insulator cleaning services using the IC Drone.

On November 11, 2024, following our commercial

agreement with IEC from August 2024, we announced the commercial launch of the IC Drone and the transition of the technology into active

On November 25, 2024, we announced

initial revenue generation under the August 2024 IEC agreement.

The IEC committed to a minimum utilization level with a guaranteed payment

in the low seven figures (in NIS) during the first year of the agreement.

The IEC satisfied this minimum utilization commitment, and on

May 27, 2025, extended the agreement for an additional year.

The IC Drone provides:

enhanced safety and precision for high-voltage insulator cleaning;

(ii) reduced water usage supporting environmental sustainability;

(iii) lower operational costs compared to traditional maintenance methods.

On June 10, 2025, we announced

the launch of our next-generation Insulator Cleaning Drone System (“ICDS2”), featuring:

● Extended flight and operational time;

● Increased maximum takeoff weight;

● Enhanced stability and position holding;

● Advanced radar capabilities;

● Improved cleaning durability.

The ICDS2 was deployed at

the start of the 2025 insulator cleaning season, marking a full-season operational timeline.

In February 2026, we introduced

AEROTRACE™, an aerial monitoring and intelligence solution designed to support infrastructure operators in assessing asset conditions

and enhancing situational awareness.

AEROTRACE™ integrates aerial data capture with software-driven analytics, including AI-assisted

image analysis, and may be deployed as a standalone solution or in conjunction with our IC Drone services.

Intellectual Property

On June 15, 2021, Duke Israel

received a notice of allowance from the U.S.

Patent and Trademark Office for a patent titled “Stabilization System,” relating

to the Company’s robotic stabilization technology.

Capital Structure and Financings

Equity Incentive Plan

On May 27, 2021, our board of directors approved the 2021 Equity Incentive

Plan (the “2021 Plan”).

On March 18, 2025, our board approved an increase in the number of shares available under the 2021

Plan from 192,000 to 360,000 shares.

On March 10, 2026, our Board approved an increase in the number of shares available under the 2021

Plan from 360,000 to 440,000 shares, and also approved to adjust the number of shares under the 2021 Plan and the numbers of options

and per-option exercise price of the options that were already granted pursuant to the Reverse Stock Split ratio of 25:1.

Private Placements

On May 11, 2021, we entered into securities purchase agreements with

eight non-U.S.

investors (the “Investors”) in a private placement offering in which we agreed to issue and sell an aggregate

(i) 500,000 shares of common stock at a price of $10 per share;

and (ii) warrants to

purchase 12,500,000 Common Stock.

The warrants were exercisable immediately and for a term of 18 months and had an exercise price of $0.40

The aggregate gross proceeds from the offering were approximately $5,000,000 and the offering closed on May 11, 2021.

5, 2022, we entered into an agreement with the Investors pursuant to which we extended the term of the warrants, to expire on November

On November 1, 2023, we and the Investors executed a second extension agreement, such that the term of the warrants was to expire

and (ii) warrants to purchase 500,000 shares of common stock.

The warrants were exercisable immediately and for a term of 18 months and had an exercise price of $10 per share.

The aggregate gross

proceeds from the offering were approximately $5,000,000 and the offering closed on May 11, 2021.

On April 5, 2022, we entered into an

agreement with the Investors pursuant to which we extended the term of the warrants, to expire on November 11, 2023.

On November 1, 2023,

we and the Investors executed a second extension agreement, such that the term of the warrants was to expire on November 11, 2024.

On June 20, 2024, we entered

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to $16.25 per share;

and (iii) include a beneficial ownership blocker that limits the exercise of such warrants if the exercise would result

in the holder beneficially owning more than 19.99% of our Common Stock immediately following the exercise.

On May 27, 2021, our board

of directors approved the 2021 Equity Incentive Plan (the “2021 Plan”) pursuant to which the Company may issue awards, from

time to time, consisting of non-qualified stock options, restricted stock grants and restricted stock units (“RSUs”).

stock option awards that qualify under Section 102 of the Israeli Tax Ordinance (New Version) 1961 (the “ITO”), and/or under

Section 3(i) of the ITO, may be granted.

On March 18, 2025, our board of directors approved an increase in the amount of shares of Common

Stock available under the 2021 Plan from 4,800,000 to 9,000,000.

On June 15, 2021, we announced

that Duke Israel received a notice of allowance from the U.S.

Patent and Trademark Office for a patent titled “Stabilization System”

regarding its stabilization technology incorporated in its advanced robotic system.

On August 15, 2022, we announced

that Duke Israel, introduced the IC Drone, a drone technology for conducting routine maintenance of critical infrastructure, and

has signed a collaboration and development agreement with the IEC, a 99% government-owned company, to provide drone-enabled

systems for cleaning electric utility cable insulators.

In October 2023, we successfully fulfilled our obligations under this agreement,

demonstrating the efficiency and safety of its IC Drone in real-world conditions.

On July 8, 2024, we announced

that we are advancing our commercial activity, following the successful completion of the pilot program for our IC Drone with the IEC,

and that we are working to expand our services globally and plan to offer insulation maintenance and washing services to electrical companies

worldwide, either independently or in collaboration with strategic partners.

On November 11, 2024, following

our commercial agreement with IEC from August 2024, we announced the commercial launch of our innovative IC Drone, a first-of-its-kind

system for washing high-voltage electric insulators and the transition to active service of our IC Drone technology.

The IC Drone’s

advanced technology provides utility companies with a safer, more efficient, and environmentally sustainable solution for maintaining

high-voltage electric infrastructure than the currently available methods.

This drone-enabled system replaces traditional methods that

rely on large, resource-intensive tanker trucks or helicopters, achieving significant water savings and operational cost reductions per

insulator or electric pole.

Key Features and Benefits

of the IC Drone:

- Enhanced Safety and Precision:

Enables high-voltage insulator cleaning with minimal personnel risk and

greater precision compared to traditional methods.

- Environmental Sustainability:

Reduces water usage significantly, supporting sustainability initiatives

within utility maintenance.

- Cost-Effective Operations:

Cuts operational costs by tens of percent per insulator and simplifies access

to remote or difficult-to-reach infrastructure.

On November 25, 2024, we announced

initial revenue generation from our August 2024 agreement with the IEC for high-voltage insulator washing services using our innovative

The August 2024 agreement with IEC represents a significant milestone, transitioning us from the development stage to active

service and revenue generation within the civilian sector.

The agreement establishes us as a provider of advanced aerial cleaning solutions

designed to enhance the safety, efficiency, and sustainability of utility maintenance operations.

The IEC has committed to a minimum utilization

of services, with a guaranteed payment in the low seven figures (in NIS) within the first year of the agreement.

With the IC Drone now

fully operational, we aim to expand our offering to other utility providers globally, leveraging the proven success of the IC Drone with

On February 18, 2025, we announced

that we established Duke Greece, our wholly owned subsidiary, to support the ongoing global commercialization efforts of our IC Drone.

This initiative follows our initial revenue generation from the IC Drone technology through a service agreement with the IEC.

will serve as a platform for promoting and deploying our innovative IC Drone technology, as well as other potential applications of the

Company’s technologies and capabilities, in the Greek market, which provides utility companies with a safer, more efficient, and

environmentally sustainable solution for maintaining high-voltage electric infrastructure as well as potential other applications of our

technologies and capabilities.

and (iii) include a beneficial ownership blocker that limits the exercise of such warrants if the exercise would

result in the holder beneficially owning more than 19.99% of our common stock immediately following the exercise.

On March 10, 2026, we

entered into an additional Warrant Amendment Agreement with the Investors pursuant to which we extended the term of the warrants, to expire

on May 1, 2031.

On December 30, 2025, we entered

into securities purchase agreements with seven (7) non-U.S.

investors, pursuant to which we, in a private placement offering, agreed to

issue and sell to the investors an aggregate of:

(i) 83,338 shares of our common stock at a price of $9 per share (the “Purchase

and (ii) warrants to purchase 83,338 shares of common stock.

The warrants have an exercise price of $16.25 per share,

are exercisable immediately and expire on November 30, 2026, subject to extension to May 30, 2028 if a public offering or other qualifying

financing of at least $2,500,000 has not occurred prior to such date.

In addition, the securities purchase agreement contains a make whole

provision that provides for the investors to receive additional shares of common stock in the event that we consummate a firm-commitment

underwritten public offering on a major stock exchange by November 30, 2026 at a price per share (after giving effect to a 20% discount)

that is less than the Purchase Price.

The aggregate gross proceeds from the offering were approximately $750,000 and the offering closed

on January 6, 2026.

Proceeds from the offering were used for general corporate purposes and working capital, including supporting our

operational and commercialization initiatives.

On March 10, 2026, we entered into an additional Warrant Amendment Agreement with the Investors

pursuant to which we extended the term of the warrants, to expire on May 1, 2031.

Authorized Capital Increase

On October 15, 2025, we filed

a Certificate of Amendment to increase our authorized common stock from 100,000,000 to 350,000,000 shares and to authorize up to 10,000,000

shares of blank-check preferred stock.

Market Opportunity

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The cleaning routine requires getting near

to active high voltage lines and using high-pressure washers carried by the helicopters or crane trucks.

to active high voltage lines and using high-pressure washers carried by helicopters or crane trucks.

Such process is considered extremely

32 unchanged sentences

robotic, drone-enabled system for cleaning electric utility insulators.

The IC Drone unique system, based on Duke’s advanced intellectual

property and know-how that integrates algorithms, autonomous systems, and robotic technologies used in mission-critical applications.

The IC Drone’s unique system, based on Duke’s advanced

intellectual property and know-how, integrates algorithms, autonomous systems, and robotic technologies used in mission-critical applications.

Our IC Drone offers a revolutionary,

safer and cost-efficient, method for maintenance of high voltage electrical infrastructure.

which require routine cleaning of insulators

safer and cost-efficient, method for maintenance of high voltage electrical infrastructure, which require routine cleaning of insulators

in order to optimize system efficiency and prevent power outages.

3 unchanged sentences

Drone service offerings to additional utility providers worldwide while continuing to develop new solutions to address evolving industry

UAS Octocopter Integrated with Six Degrees

of Freedom (“6 DOF”) Robotic Gimbal

Our special purpose UAS Octocopter

(DK-HIPPOGRIFF) integrates for operational usage with our 6 DOF robot and is intended primarily for Military and homeland security purposes.

Our lightweight robot allows accurate firing from various configurations consisting of UAS-mounted, land-mounted on light all-terrain

vehicles and sea-mounted on boats.

The robot is mounted on our UAS Octocopter platform, a combined system which we market under the commercial

name “TIKAD.”

In addition to the various

configurations and mounting options, the robots also permit the utilization of a wide range of small arms, light weapons and shotguns,

with lethal and less lethal ammunition, with a maximum weight of nine (9) kilograms (approximately twenty (20) pounds).

The combination

of our robot, along with our stabilization platform and software, provides a unique firing platform that permits precision firing regardless

of weather conditions or other variables.

Additionally, our robot may

also be utilized as a ground sniper platform.

Since the robot is a standalone unit, it can be mounted on a patrol or attack vehicle or

be positioned at a strategic location.

The capability of remote operation without the need to expose the operator to tactical danger can

replace troops in different settings.

This capability may reduce the number of casualties due to “friendly fire” incidents

and may also significantly reduce exposure and risk to combat troops.

Our robot is controlled by a remote-control device that permits

the user to exert full control over its functions, including arming the robot as well as control the firing mechanism.

Our lightweight robot can

also be used for civilian purposes and bring solutions that do not yet exist for different tasks that require high-end stabilization,

vertical takeoff and landing (“VTOL”) robotic landing gear for drones, VTOL aircrafts and medical aid robotic uses

and for maintenance and monitoring of different essential infrastructures, such as cleaning electric utility cable insulators.

our sales of the robot to increase as additional product options expand.

We will also address, as needed, evolving regulation of civilian

Accordingly, we are also developing AI-driven monitoring and analytics solutions designed to support continuous inspection, anomaly

detection and predictive maintenance for power grids and other critical utility infrastructure.

These solutions are being advanced both

internally and, in certain cases, through collaborations with third-party technology partners.

On June 10, 2025, we

announced the launch of our next-generation Insulator Cleaning Drone System, representing a significant technological advancement in our

innovative utility maintenance drone solution.

The ICDS2 builds upon our proven IC Drone technology with substantial performance improvements

designed to enhance operational capabilities for utility providers worldwide.

The ICDS2 is agnostic to the drone platform and can be adjusted

and adapted to fit and be mounted on other type of drone platforms that meet our specifications and certification.

The ICDS2 features several

key technological advancements over its predecessor:

Extended Flight and Operational Time:

Offering longer flight duration, enabling more efficient servicing of multiple high-voltage insulators in every flight mission.

Increased Maximum Takeoff Weight:

A considerably higher payload capacity allows the system to carry more cleaning agent, allowing longer refill intervals and enhancing operational efficiency.

Enhanced Stability and Position Holding:

Advanced stabilization algorithms and improved communication systems deliver superior precision during cleaning operations, enabling operational capabilities even in more challenging weather conditions.

Advanced Radar System:

Next-generation sensors provide improved detection capabilities, enhancing safety and allowing for operations in more complex environments.

Superior Cleaning Durability:

Reinforced cleaning mechanisms and optimized water delivery systems increase cleaning effectiveness while reducing maintenance requirements.

AEROTRACE™ aerial monitoring and intelligence

In February 2026, we announced

the introduction of AEROTRACE™, an aerial monitoring and intelligence solution, integrating a combination of capabilities and developments

in the fields of hardware, sensors, software and artificial intelligence (“AI”), including through collaboration with other

parties, designed to support infrastructure operators in assessing asset conditions and enhancing situational awareness.

integrates aerial data capture with software-driven analytics, including AI-assisted image analysis, to help identify areas of interest

and potential anomalies across large-scale and distributed infrastructure assets.

AEROTRACE™ is designed to be deployed as a standalone

monitoring solution and may also complement our existing robotic IC Drone services by informing maintenance planning and prioritization.

The introduction of AEROTRACE™ reflects our ongoing efforts to expand its technology portfolio beyond robotic hardware to include

data- and intelligence-driven solutions.

UAS Octocopter Integrated with Stabilized Robotic

Gimbal Remote Weapon Systems

Our advanced 6 Degrees of

Freedom (“DOF”) robotic system enables remote, real-time, pinpoint accurate firing of small arms and light weapons that can

achieve pinpoint accuracy regardless of the movement of the weapons platform or the target.

It is intended primarily for Military and

homeland security purposes and our lightweight robot allows accurate firing from various configurations consisting of UAS-mounted, land-mounted

on light all-terrain vehicles and sea-mounted on boats.

Through Duke Israel we entered

into a Collaboration Agreement with Elbit for the global marketing and sales, and the production and further development by Elbit of our

developed advanced robotic system mounted on a UAS, armed with lightweight firearms, which we then marketed under the commercial name

Elbit is marketing the drone-mounted

remote weapon systems, including a system in the name of “Bird of Prey”.

Assembly and Testing

While we maintain the ability

to assemble our robots, IC Drone system for cleaning electric utility insulators and UAS Octocopter at our facility in Israel, we currently

outsource the assembly and production to third-party manufacturers, from which we also purchase supplies and custom-made machined parts

required for the production of our IC Drone system for cleaning electric utility insulators.

We currently source our parts and materials

from approximately twenty (20) suppliers located primarily in the United States, Europe, Israel and China.

We are not, however, dependent

on any single manufacturer.

In addition, while the components we purchase are built according to our specific designs and requests, we

believe the components and materials we purchase are common in nature and can easily be obtained from alternative suppliers, if necessary.

Components are tested and approved against the expected points of failure during extended and aggressive operations.

For example, we test

items such as the load carrying capacity of our products as well as various software components and compliance with live power line rigid

After the lab testing phase, the IC Drone system for cleaning electric utility insulators and UASs undergoes a series of field

tests which examine the operation of each function.

The IC Drone system for cleaning electric utility insulators is mounted on and integrated

with third parties commercially available suitable drones.

Results are combined with multi-phased airborne testing.

In addition, we have not executed

supply agreements with our third-party suppliers.

More importantly, our proprietary and confidential complex kinematic algorithms and

control software is our most valuable intellectual property.

We have built an in-house laboratory to support the assembly and commercialization

of our products.

We believe that the current size and capacity of our in-house laboratory, located at our facilities in Israel, will be

sufficient to support all of our commercialization activities in the near future.

Our manufacturing facility

of the ICDS that is mounted on the drone, is located in Israel.

The manufacturing process of our ICDS largely consists of the

assembly, integration and testing of purchased components.

We purchase custom-made machined

parts and other components required for production of the ICDS from third-party manufacturers.

We source parts and materials from approximately

twenty suppliers located primarily in the United States, Europe, Israel and China.

Although certain components are manufactured to our

specifications, we believe they are common in nature and can be obtained from alternative suppliers if needed.

We are not dependent on

any single supplier.

However, if a supplier discontinues delivery, identifying a replacement source may result in additional cost and

manufacturing delays.

The manufacturing process

for our ICDS primarily consists of the assembly, integration, and testing of purchased components.

As part of the testing process, components

are evaluated and approved against the expected points of failure during extended and high-intensity operations, including tests of load-carrying

capacity, software performance, and compliance with electrical utility safety and live-line standards.

Following laboratory testing, the

ICDS and the UAS platforms undergo a multi-stage field-testing process designed to validate the performance of each system function.

ICDS is then mounted and integrated onto third-party commercially available drones, followed by airborne testing phases.

Our ICDS is designed to be

drone-platform agnostic and can be adapted to different drone platforms that meet our defined specifications and regulatory certifications.

We currently utilize a commercially available drone (including its batteries and chargers) manufactured by a well-known international

drone manufacturer, which has been deployed by us in thousands of flight hours.

We have built an in-house

laboratory to support assembly, system integration, testing and ongoing commercialization activities.

We believe the current size and

capacity of this laboratory will be sufficient to support our near-term production and commercialization needs.

Pursuant to our Collaboration

Agreement with Elbit, manufacturing of the defense-market variant of our technology—branded as the “Bird of Prey”—is

conducted by Elbit.

Research and development related to the defense variant is likewise carried out by Elbit, while we retain the contractual

right to make mutual and unlimited use for civilian applications of any new knowledge developed by Elbit under the collaboration.

Our research and development

capabilities support both ongoing improvements to the ICDS and the development of new applications for utility and infrastructure customers.

In collaboration with the IEC, we continue to develop complementary capabilities such as hydrophobic coating applications for insulators.

In parallel, we are developing AI-based monitoring solutions for power grids and other critical utility infrastructure, including through

collaborations with third parties.

These capabilities are expected to integrate with and enhance the performance, safety, and value proposition

of our robotic aerial service systems.

Market Strategy

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We are currently focused on

expending the commercialization of the IC Drone, a first-of-its-kind robotic, drone-enabled system for cleaning electric utility insulators,

expanding the commercialization of the IC Drone, a first-of-its-kind robotic, drone-enabled system for cleaning electric utility insulators,

in the civilian market.

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Following that successful pilot, in August 2024, we, through Duke Israel, entered into another agreement with the IEC to provide

high-voltage insulator washing services using IC Drone system.

high-voltage insulator washing services using the IC Drone system and on May 27, 2025, IEC extended the agreement for an additional year.

On February 18, 2025, we announced

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its significant market potential for broader deployment across additional regions and sectors.

On January 13, 2026, we announced that

Duke Greece, received operational authorization for its IC Drone system from the HCAA, Greece’s civil aviation regulator.

The authorization

to operate the IC Drone in Greece was granted following Duke Greece’s successful completion of the SORA process, a comprehensive,

risk-based methodology developed by the EASA to ensure that complex drone operations are conducted safely and in compliance with EU Regulation

The authorization permits Duke Greece to conduct drone flights as part of its IC Drone product.

With the receipt of this authorization,

Duke Greece has completed the regulatory process required to enable IC Drone operations in the Greek market.

The SORA framework is an

accepted means of compliance under EASA regulations governing drone operations across all European Union member states.

While authorizations

remain subject to review by individual national aviation authorities, the completion of the SORA process under the EU-harmonized framework

aligns the IC Drone system with the regulatory standards applicable across the EU.

We are currently in the initial

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mounted on UAS Octocopter platform, and later from sales of our robot mounted on other platforms, such as light all-terrain vehicles and

sea-mounted on boats.

● Focus on sales in the United

Focus on sales in the United States.

We believe that the United States military will be a lead and reference customer.

The United States alone presents a significant

and diverse market opportunity - special operation forces units, various counter-terrorism (federal, state and city) units, regular local

police forces (the use of less-lethal weapons), U.S.

The United States alone presents a significant and diverse market opportunity - special operation forces units, various counter-terrorism (federal, state and city) units, regular local police forces (the use of less-lethal weapons), U.S.

Army, National Guard, U.S.

Navy, Coast Guard and the Border Police.

● Sales to the North Atlantic

Treaty Organization (NATO) Countries .

We believe adoption of such products in the United States will open the markets in countries

that are U.S.

Sales to the North Atlantic Treaty Organization (NATO) Countries.

We believe adoption of such products in the United States will open the markets in countries that are U.S.

allies such as the NATO countries.

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To protect certain key technologies,

we have submitted a U.S.

patent Application for stabilization system patents, which is pending.

We do not know whether any of our current

or future patent applications will result in the issuance of any patents.

we have currently only submitted a U.S.

patent Application for stabilization system patents.

On June 15, 2021, we announced that our wholly

owned Israeli subsidiary, Duke Airborne Systems Ltd., received a notice of allowance from the U.S.

Patent and Trademark Office for a patent

titled “Stabilization System” regarding its stabilization technology incorporated in its advanced robotic system.

know whether any of our current or future patent applications will result in the issuance of any patents.

We currently do not have pending

patent applications or approved patents in any other country.

Certain of our product and

solution names, including AEROTRACE™, are used by us in connection with our business and offerings.

AEROTRACE™ is a product

name used by us and we are in the process of preparing an application to register the name as a trademark.

Until such registration is

completed, we rely on common law rights and other applicable protections with respect to such product names.

Sales and Marketing

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are currently concentrated on the IC Drone as well as other potential applications of the Company’s technologies and capabilities,

using company employees, service providers, agent and related electric infrastructure companies.

The current marketing efforts increased

significantly following the official launch of the latest version of the IC Drone in November 2024 and the establishment of our wholly

owned subsidiary Duke Greece in February 2025.

using company service providers, agent and related electric infrastructure companies.

The current marketing efforts increased significantly

following the official launch of the latest version of the IC Drone in June 2025 and the establishment of our wholly owned subsidiary

Duke Greece in February 2025.

Defense and Military Market

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a worldwide exclusive license for the use of Duke Israel’s know-how and intellectual property and the marketing, sales, production,

and further development of the TIKAD for military, defense, homeland security, and para-military uses.

As consideration for granting the

worldwide exclusive license, Elbit will pay Duke Israel royalties from revenues received from worldwide sales of TIKAD, with royalty rates

ranging from low to mid-double-figure percentages, depending on the tiers of the selling price of TIKAD, for a period starting from the

date of the Collaboration Agreement until 15 years following receipt of $50 million in cumulative revenues from sales of TIKAD units.

In addition, Duke Israel agreed to pay Elbit similar rates of royalties for revenues received by Duke from sales of its advanced robotic

system for civil use, if such systems will include new know-how developed by Elbit.

On June 15, 2021, we announced

that our wholly owned Israeli subsidiary, Duke Airborne Systems Ltd., received a notice of allowance from the U.S.

Patent and Trademark

Office for a patent titled “Stabilization System” regarding its stabilization technology incorporated in its advanced robotic

Marketing and sales efforts related to TIKAD were originally anticipated

to be led by Elbit due to our Collaboration Agreement with Elbit, and we are aware that Elbit is marketing drone-mounted remote weapon

systems, including a system in the name of “Bird of Prey”.

We requested reports from Elbit regarding sales and royalties related

to drone-mounted remote weapon systems, as outlined in the Collaboration Agreement and it is in discussion with Elbit.

and further development of the system we marketed under the name TIKAD (“System”) for military, defense, homeland security,

and para-military uses.

As consideration for granting the worldwide exclusive license, Elbit will pay Duke Israel royalties from revenues

received from worldwide sales of the System, with royalty rates ranging from low to mid-double-figure percentages, depending on the tiers

of the selling price of System, for a period starting from the date of the Collaboration Agreement until 15 years following receipt of

$50 million in cumulative revenues from sales of System units.

In addition, Duke Israel agreed to pay Elbit similar rates of royalties

for revenues received by Duke from sales of its advanced robotic system for civil use, if such systems will include new know-how developed

On April 2, 2025, we and Elbit

executed a Supplement Letter expanding the collaboration to allow us to market the stabilized weapons drone system to military, defense,

homeland security, and para-military customers, in coordination with Elbit.

We are entitled to receive a commission, in the mid-single

digit percentage range, from proceeds resulting from our marketing activities, in addition to royalties under the Collaboration Agreement.

Marketing and sales efforts

related to the System are led by Elbit due to our Collaboration Agreement with Elbit, and we are aware that Elbit is marketing drone-mounted

remote weapon systems, including a system in the name of “Bird of Prey”.

Civilian Sector

To our knowledge there is

no equivalent cleaning system which is based on drones for cleaning insulators.

Although drones are being used for cleaning solar panels

as well as windows, using high pressure water, such systems cannot handle the challenges that come with cleaning of insulators due to

the high voltage environment that effects the drones.

To our knowledge there are

several drone based systems for cleaning different types of infrastructures including solar panels, wind turbines, buildings, windows,

etc., using high pressure water.

We believe such systems are not designed to handle the challenges that come with cleaning high voltage

power grid insulators due to the high voltage environment that affects the drones.

Competition is based on product

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Government Contracting

We operate under laws, regulations and administrative rules governing defense and other government contracts,

mainly in Israel and the United States.

Some of these carry major penalty provisions for non-compliance, including disqualification from

participating in future contracts.

In addition, our participation in governmental procurement processes in Israel, the United States and

other countries is subject to specific regulations governing the conduct of the process of procuring defense and homeland security contracts.

We operate under laws, regulations and administrative rules governing defense and other government contracts, mainly

in Israel and the United States.

Some of these carry major penalty provisions for non-compliance, including disqualification from participating

in future contracts.

In addition, our participation in governmental procurement processes in Israel, the United States and other countries

is subject to specific regulations governing the conduct of the process of procuring defense and homeland security contracts.

Israeli Export Regulations.

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that are typically sold in the commercial market but that also may be used in the defense market).

We have filed marketing applications

with the IMOD and have already received marketing approvals for about fifty (50) countries including the U.S.

It is expected that in the

mid-term more than seventy-five percent (75%) of our revenue will be derived from exports subject to Israeli export regulations.

Approval of Israeli

Defense Acquisition.

The Israeli Defense Entities Law (Protection of Defense Interests) establishes conditions for the approval

of an acquisition or transfer of control of an entity that is determined to be an Israeli “defense entity” under the terms

Designation as a “defense entity” is to occur through an order to be issued jointly by the Israeli Prime Minister,

Defense Minister and Economy Minister.

Although no such orders relating to us have been issued as of the date hereof, it is possible that

our Israeli subsidiary may be designated as a “defense entity” under the law.

An order (pursuant to the law) would establish

conditions and restrictions regarding non-Israeli control of our Israeli subsidiary.

For example, Israeli government approval might be

required for acquisition of twenty-five percent (25%) or more of the voting securities or a smaller percentage of shares of common stock

that grant “means of control” in the Company, if such were to directly affect the control of our Israeli subsidiary.

of Control for the purposes of the law includes the right to control the vote at a shareholders’ meeting or to appoint a director.

Approval of Israeli Defense

The Israeli Defense Entities Law (Protection of Defense Interests) establishes conditions for the approval of an

acquisition or transfer of control of an entity that is determined to be an Israeli “defense entity” under the terms of the

Designation as a “defense entity” is to occur through an order to be issued jointly by the Israeli Prime Minister, Defense

Minister and Economy Minister.

Although no such orders relating to us have been issued as of the date hereof, it is possible that our

Israeli subsidiary may be designated as a “defense entity” under the law.

An order (pursuant to the law) would establish conditions

and restrictions regarding non-Israeli control of our Israeli subsidiary.

For example, Israeli government approval might be required for

acquisition of twenty-five percent (25%) or more of the voting securities or a smaller percentage of shares of common stock that grant

“means of control” in the Company, if such were to directly affect the control of our Israeli subsidiary.

Means of Control

for the purposes of the law includes the right to control the vote at a shareholders’ meeting or to appoint a director.

Approval of U.S.

Other Defense Acquisitions.

Many countries in addition to Israel also require governmental approval of acquisitions of local

defense companies or assets by foreign entities.

Defense Acquisitions.

Many countries in addition to Israel also require governmental approval of acquisitions of local defense

companies or assets by foreign entities.

Mergers and acquisitions of certain types of defense related businesses in the U.S.

subject to the Foreign Investment and National Security Act (“FINSA”).

Under FINSA, foreign acquisitions of certain types

of defense related businesses in the U.S.

require review, and in some cases approval, by the Committee on Foreign Investment in the United

States (“CFIUS”).

In that regard, if a foreign entity attempts to acquire us or all of our domestic assets, such transactions

may be subject to FINSA, and in certain instances CFIUS has the authority to order divestment and cancellation of the transaction.

to the Foreign Investment and National Security Act (“FINSA”).

Under FINSA, foreign acquisitions of certain types of defense

related businesses in the U.S.

require review, and in some cases approval, by the Committee on Foreign Investment in the United States

In that regard, if a foreign entity attempts to acquire us or all of our domestic assets, such transactions may

be subject to FINSA, and in certain instances CFIUS has the authority to order divestment and cancellation of the transaction.

“ Buy American”

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most of the products we may sell in the United States.

American Security Drone Act (ASDA)”.

The ASDA, part of the National Defense Authorization Act (NDAA) ,

federal agencies from procuring or operating drones manufactured in “covered foreign entities,” primarily targeting

China, due to security risks.

It prohibits the use of federal funds for such drones and mandates the removal of existing foreign drones

from federal inventory, with limited exceptions for, e.g., research or emergency operations.

Procurement Regulations.

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program, including specific procedures, record keeping and training.

The IMOD may audit our books and records relating to its contracts with us.

Our books and records and other

aspects of projects that will be related to the U.S.

Audit Regulations.

IMOD may audit our books and records relating to its contracts with us.

Our books and records and other aspects of projects that will

be related to the U.S.

defense contracts will be subject to audit by U.S.

government audit agencies.

audits review compliance with government contracting cost accounting and other applicable standards.

If discrepancies are found this could

result in a downward adjustment of the applicable contract’s price.

Some other customers have similar rights under specific contract

Such audits review compliance with

government contracting cost accounting and other applicable standards.

If discrepancies are found this could result in a downward adjustment

of the applicable contract’s price.

Some other customers have similar rights under specific contract provisions.

Civil Aviation Regulations.

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Administration and similar civil aviation authorities in Israel, Greece, the EU, and other countries.

Environmental, Health

and Safety Regulations.

On January 13, 2026, Duke Greece

received operational authorization from the Hellenic Civil Aviation Authority following completion of the SORA process under EU Regulation

This authorization enables IC Drone operations in Greece and aligns the system with European Union regulatory standards.

Environmental, Health and

Safety Regulations.

We are subject to a variety of environmental, health and safety laws and regulations in the jurisdictions

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areas with a potential environmental or safety impact.

We currently have one full-time

employee, our Chief Executive Officer.

Additionally, we engage two (2) executive officers:

our Chief Technology Officer (“CTO”)

and our Chief Financial Officer.

We engage freelance contractors and consultants in order to limit our operating expenses and therefore

allowing us to scale as necessary.

We maintain long-term relationships with these freelance contractors and consultants.

We engage three (3) executive officers:

our Chief Executive Officer

(“CEO”), Chief Technology Officer (“CTO”) and our Chief Financial Officer (“CFO”) as well as one (1)

additional employee that serves as our Vice President Business Development.

We engage freelance contractors and consultants in order to

limit our operating expenses and therefore allowing us to scale as necessary.

We maintain long-term relationships with these freelance

contractors and consultants.

Some of our consulting agreements

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What changed 10-K

Item 1. Business