What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-03-05 compared with 2025-02-27 · 185 added, 200 removed, 587 unchanged (40% of the section changed)

27 unchanged sentences

Changes in Internal Control over Financial Reporting

There were no changes in our internal controls over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

During the year ended December 31, 2025, we implemented NetSuite as our enterprise resource planning (“ERP”) system.

In connection with this implementation, we designed and implemented new internal controls and modified certain existing controls.

There were no changes in our internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION .

40 unchanged sentences

Articles of Amendment to Articles of Incorporation as filed on August 19, 2021

Amended and Restated By-Laws

Bylaw amendment adopted February 29, 2012

Certificate of Amendment to the Articles of Incorporation of Inuvo, Inc.

as filed with the Secretary of State and effective as of June 10, 2025.

Second Amended and Restated Bylaws

Description of Securities

33 unchanged sentences

2017 Equity Compensation Plan Non-Qualified Stock Option Agreement

Quick Action Closing Fund Grant Agreement, dated January 25, 2013, with the Arkansas Economic Development Commission

Grant Reimbursement Agreement, dated January 25, 2013, with the Arkansas Economic Development Commission.

Amendment to Grant Reimbursement Agreement, dated March 2021, with the Arkansas Economic Development Commission.

Employment Agreement dated March 1, 2012 between Inuvo, Inc.

2 unchanged sentences

and Wallace D.

Employment Agreement dated March 1, 2012 between Inuvo, Inc.

Loan and Security Agreement dated February 28, 2020 effective March 12, 2020 by and between Inuvo, Inc.

and its subsidiaries and Hitachi Capital America Corp.

Amendment No.

1 to Loan and Security Agreement and Collateral Documents, dated March 1, 2023, by and between Mitsubishi HC Capital, Inc., f/k/a Hitachi Capital America Corp.

and Inuvo, Inc.

and its subsidiaries.

Amended and Restated Executive Employment Agreement, dated January 27, 2026, between Inuvo Inc.

and Robert C.

Form of Insider Offering Subscription Agreement

4 unchanged sentences

and Daily Reads, LLC, and SLR Digital Finance LLC, effective as of July 30, 2024.

2025 Omnibus Incentive Compensation Plan

2025 Equity Compensation Plan Form of Restricted Stock Unit Agreement

2025 Equity Compensation Plan Form of Non-Qualified Stock Option Agreement

Separation Agreement and Release, dated September 30, 2025, between Inuvo, Inc.

and Barry Lowenthal

Form of Securities Purchase Agreement, by and between Inuvo, Inc.

and the Buyer

Form of Subordinated Convertible Note

Form of Registration Rights Agreement by and between Inuvo, Inc.

and the Buyer

Debt Subordination Agreement, made by Buyers in favor of SLR Digital Finance, LLC

Extension Agreement to Google Services Agreement between Vertro, Inc.

and Google LLC, dated as of February 17, 2026

Insider Trading Policy

18 unchanged sentences

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

February 27, 2025

March 5, 2026

/s/ Wallace D.

1 unchanged sentence

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Richard K.

/s/ Robert C.

Chairman of the Board of Directors and Chief Executive Officer (principal executive officer)

February 27, 2025

March 5, 2026

/s/ Wallace D.

Chief Financial Officer (principal financial and accounting officer)

February 27, 2025

March 5, 2026

/s/ Jonathon Bond

February 27, 2025

March 5, 2026

Jonathon Bond

/s/ Gordon J.

February 27, 2025

March 5, 2026

/s/ Kenneth Lee

February 27, 2025

/s/ Charles D.

February 27, 2025

March 5, 2026

/s/ Richard K.

March 5, 2026

CONSOLIDATED FINANCIAL STATEMENTS

4 unchanged sentences

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Loss

Consolidated Statements of Operations

Consolidated Statements of Stockholders’ Equity

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We have audited the accompanying consolidated balance sheets of Inuvo, Inc.

(the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the years then ended, 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 2023, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

(the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years then ended, 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, 2025 and 2024, and the results of their operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

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

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

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

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

12 unchanged sentences

Iselin, New Jersey

February 27, 2025

March 5, 2026

Consolidated Balance Sheets

For the Years Ended December 31,

Current assets

6 unchanged sentences

Right of use assets - finance lease

Referral and support services agreement advance

Intangible assets, net of accumulated amortization

6 unchanged sentences

Lease liability - finance lease

Outstanding borrowings under Financing Agreement

Total current liabilities

2 unchanged sentences

Lease liability - operating lease

Lease liability - finance lease

Other long-term liabilities

Total long-term liabilities

6 unchanged sentences

Additional paid-in capital

Accumulated other comprehensive income

Accumulated deficit

4 unchanged sentences

See accompanying notes to the consolidated financial statements.

Consolidated Statements of Operations and Comprehensive Loss

Consolidated Statements of Operations

For the Years Ended December 31,

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Other income/(expense):

Financing expense, net of interest income

Financing expense, net

Loss before taxes

Income tax (expense)/benefit

Loss from continuing operations

( 5,084,813 )

( 5,753,771 )

Other comprehensive income:

Unrealized loss on marketable securities

Comprehensive loss

Income tax expense

$ ( 5,095,518 )

2 unchanged sentences

Basic and diluted

Net loss from continuing operations

Net income from discontinued operations

Weighted average shares:

2 unchanged sentences

For the Years Ended December 31, 2025 and 2024

Additional Paid in

Accumulated Other Comprehensive

Additional Paid

Balances as of December 31, 2023

3 unchanged sentences

( 5,761,801 )

Unrealized gain on debt securities

Stock-based compensation

AGP Closing of at-the-market sale of common stock

Stock issued for vested restricted stock unit

Proceeds from sale of common stock, net of expenses

Stock issued for vested restricted stock awards

Shares withheld for taxes on vested restricted stock units

Change in fair value of warrants related to vesting

Issuance of restricted stock units

Balances as of December 31, 2024

2 unchanged sentences

( 5,095,518 )

Issuance of restricted stock units

Stock-based compensation

Stock issued for vested restricted stock unit

Stock issued for vested restricted stock awards

Shares withheld for taxes on vested restricted stock units

At-the-market sale of common stock, net of issuance costs

Balances as of December 31, 2025

12 unchanged sentences

Stock based compensation

Gain on marketable securities

Amortization of financing fees

2 unchanged sentences

( 1,442,533 )

Stock warrant income

Deferred income tax expense (benefit)

Deferred income tax expense

Derecognition of contingency and grant

6 unchanged sentences

Accrued expenses and other liabilities

( 5,565,487 )

Lease liability - operating lease

2 unchanged sentences

Investing activities:

Capitalized software development costs and purchases of equipment

Purchases of equipment and capitalized development costs

( 1,601,903 )

( 1,857,375 )

Proceeds from the sale of marketable securities

Net cash provided by/(used in) investing activities

( 1,601,903 )

( 1,857,375 )

Financing activities:

Gross proceeds from line of credit

Repayments on line of credit

Proceeds from sale of common stock, net of expenses

Payments on finance/capital leases

Net taxes paid on RSU grants exercised

Proceeds from at-the-market sales

Proceeds from at-the-market sales, net

Proceeds net of payments on Financing Agreement

Principal payments on finance lease obligations

Net taxes paid on restricted stock unit grants exercised

Net cash provided by/(used in) financing activities

13 unchanged sentences

Company Overview

Inuvo is an advertising technology and services company that has developed and commercialized large language generative artificial intelligence (AI) capable of discovering and targeting digital audiences.

Inuvo’s innovative technology positions it as a leader within the advertising industry, offering a valuable solution to marketers seeking to navigate the evolving landscape of consumer privacy.

The AI targets the reasons behind why people are interested in products, services and brands.

Inuvo is an advertising technology and services company that has developed and commercialized large language generative artificial intelligence (AI) for modeling media audiences.

Inuvo’s innovative technology provides a valuable solution to marketers seeking to navigate the evolving landscape of consumer privacy and we have successfully commercialized a proprietary, patented large language model (“LLM”) that identifies and actions the reasons why consumers are interested in products, services, or brands - rather than who they are - offering a high-performance, privacy-by-design solution for the modern advertising landscape.

Inuvo sells its information technology solutions to agencies and brands (collectively, “Agencies & Brands”) along with large consolidators of advertising demand (“Platforms”).

Inuvo’s revenue is derived from the placement of digital advertising across devices, websites, applications and browsers within social, search and programmatic advertising channels.

Inuvo facilitates and gets paid to deliver advertising messages and counts among its client's numerous world-renowned companies across industries.

The AI, marketed as IntentKey was designed to replace the consumer data, analytics, segmentation and lookalike modeling technologies that have traditionally served the advertising industry as it transitions to a new paradigm where targeting based on a consumer’s identity and data are no longer possible due to the legislative and technological changes occurring.

Inuvo’s AI technology solves the identity challenge by leveraging artificial intelligence, data analytics, and automation that can optimize the purchase and placement of advertising in real time without consumer data.

The technology can be consumed by clients as a managed service or self-service (SaaS).

Inuvo’s revenue is primarily derived from the placement of digital advertising across devices, websites, applications and browsers within social, search and programmatic advertising channels.

Inuvo facilitates and gets paid to deliver advertising messages and counts among its clients numerous world-renowned companies across industries.

Inuvo’s AI technology, marketed as IntentKey®, leverages artificial intelligence, data analytics and automation that can optimize the purchase and placement of advertising in real time without consumer data.

The technology can be consumed by Agency & Brands clients as a managed service or software-as-a-service (SaaS).

Additionally, Inuvo has developed proprietary technology and assets tailored to certain clients that include digital content, websites, automated campaigns, ad fraud detection, performance reporting, and predictive media mix modeling.

Both Agencies & Brands and Platforms benefit from Inuvo’s ability to intelligently process vast amounts of data, detect patterns in behavior, and enhance advertising efficiency whether through direct media execution or integration into existing campaign management systems.

These capabilities are typically sold with services both individually and in combination with each other based on client needs.

Agencies & Brands utilize our artificial intelligence-based consumer intent recognition system to reach highly targeted mobile and desktop In-Market audiences with precision.

The solution can serve multiple creative formats including display, video, audio and native across multiple device types including desktop, mobile, tablet, connected/smart TV and game consoles.

The technology can be consumed by clients as a managed service or self-service (SaaS).

For our Platform clients we utilize a collection of data, analytics, software, content management and website creation technologies to align merchant advertising messages with online content.

Inuvo’s intellectual property is protected by 19 issued and eight pending patents.

Inuvo’s competitive moat and intellectual property are protected by 18 issued and three pending patents issued by the United States Patent and Trademark Office.

Our IP portfolio includes patents, trade secrets and trademarks.

We actively seek to protect our IP rights and to deter unauthorized use of our IP and other assets.

While our IP rights are important to our success, our business is not significantly dependent on any single patent, trademark, or other IP right.

Our principal sources of liquidity are the sale of our common stock and our credit facility discussed in Note 6 – Bank Debt.

On May 30, 2023, we raised $ 4.0 million in gross proceeds in a registered direct offering, before expenses, through the sale of an aggregate of 16,000,000 shares of our common stock.

The shares were offered pursuant to an effective shelf registration statement on Form S-3 (the “Shelf Registration Statement”) and a prospectus supplement relating to the offering was filed with the SEC on May 26, 2023.

On May 7, 2024, we entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C.

1 unchanged sentence

LLC (“Wainwright”), to sell shares of our common stock, par value $ 0.001 per share, (the “Shares”), having an aggregate sales price of up to $ 15,000,000 , from time to time, through an “at the market offering” program under which Wainwright will act as sales agent.

The sales, if any, of the Shares made under the ATM Agreement will be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended.

The Company will pay Wainwright a commission rate of up to 3.0 % of the aggregate gross proceeds from each sale of Shares.

For the year ended December 31, 2024, the Company has not sold any shares of common stock under the ATM Agreement.

In January 2025, the Company utilized the ATM Agreement and sold 1,594,313 shares of common stock for gross proceeds of $ 1,163,491 .

See Note 16 – Subsequent Events.

The sales of the Shares made under the ATM Agreement will be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended.

We will pay Wainwright a commission rate of up to 3.0 % of the aggregate gross proceeds from each sale of Shares.

For the year ended December 31, 2024, we did not sell any shares of common stock under the ATM Agreement.

During the year ended December 31, 2025, we utilized the ATM Agreement and sold 165,641 shares of common stock for gross proceeds of $ 1,184,740 , before deducting commissions and other offering-related costs.

On July 31, 2024, we entered into a Financing and Security Agreement (the “Financing Agreement”) with SLR Digital Finance LLC (“SLR”), effective July 30, 2024.

Pursuant to the terms of the Financing Agreement, SLR will finance up to $ 10 million dependent upon eligible receivables.

See Note 6– Bank Debt.

Pursuant to the terms of the Financing Agreement, SLR will finance up to $ 10 million subject to availability based on the amount of eligible accounts receivable.

Eligibility is determined by criteria such as geographic location of the customer and aging of receivables.

As of December 31, 2025, our accounts receivable, net of allowance for credit losses, were $ 5,887,884 , of which a substantial portion qualified as eligible under the Financing Agreement.

At December 31, 2025, the outstanding balance due under the Financing Agreement was $ 3,288,100 .

See Note 6 – Bank Debt for more information.

As of December 31, 2025, we have approximately $ 2.8 million in cash and cash equivalents.

1 unchanged sentence

We have encountered recurring losses and cash outflows from operations, which historically we have funded through equity offerings and debt facilities.

For the year ended December 31, 2024 we had a net loss of $ 5.8 million and net cash flow provided by operations of $ 0.2 million.

For the year ended December 31, 2025 we had a net loss of $ 5.1 million and net cash flow used in operations of $ 1.8 million.

Additionally, our investment in investing activities totaled approximately $ 1.6 million for the year ended December 31, 2025.

This amount primarily consists of internally developed software costs, which are largely comprised of fixed labor costs, along with other capitalized expenditures.

This amount primarily consisted of internally developed software costs, which are largely comprised of fixed labor costs, along with other capitalized expenditures.

Through December 31, 2025, our accumulated deficit was $ 178.3 million.

Management plans to support the Company’s future operations and capital expenditures primarily through cash generated from its credit facility until such time as we reach profitability.

Management plans to support our future operations and capital expenditures primarily through cash generated from its credit facility until such time as we reach profitability.

Any repayments of the Financing Agreement will be made through collections from eligible accounts receivable.

We believe that our current cash position, credit facility, and the equity raised through our ATM program in January 2025 will be sufficient liquidity to sustain operations for at least the next twelve months from the date of this filing.

We believe our current cash position, together with availability under our credit facility and proceeds received subsequent to December 31, 2025 from the $ 6.2 million class action settlement and the subordinated convertible notes issued in January 2026, will be sufficient to sustain operations for at least the next twelve months from the date of this filing.

If our plan to grow the IntentKey product is unsuccessful, we may need to fund operations through private or public sales of securities, debt financings or partnering/licensing transactions over the long term.

2 unchanged sentences

All intercompany accounts and transactions have been eliminated in consolidation.

Reclassifications - Certain amounts in the 2023 statement of cash flows have been reclassified to conform with the 2024 presentation.

The impact to the 2023 change in accrued expenses and other liabilities was a decrease of $ 67,870 , and there was no impact to net cash used in operating activities for the year ended December 31, 2023.

Cash and cash equivalents - Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less.

11 unchanged sentences

We settle advertisement placement prices with our customers net of any adjustments for quality.

In the year ended December 31, 2024, we generated $ 83,793,859 in revenue of which 82.8 % was from Platforms, 17.2 % from Agencies & Brands.

In the year ended December 31, 2023, we generated $ 73,911,528 in revenue of which 79.1 % was from Platforms, 20.9% from Agencies & Brands.

Accounts receivable - Accounts receivable consist of trade receivables from customers.

We record accounts receivable at its net realizable value, recognizing an allowance for doubtful accounts based on our best estimate of expected credit losses on our existing accounts receivable.

Balances are written off against the allowance after all means of collection have been exhausted and the possibility of recovery is considered remote.

The current expected credit loss (CECL) model under Accounting Standards Update (ASU) 2016-13 requires an estimation of expected credit losses over the life of a financial instrument, taking into consideration historical experience, current conditions, and reasonable and supportable forecasts.

Management has reviewed comprehensive historical data, any relevant economic indicator, and estimated our estimated credit loss based off these probabilities.

In the year ended December 31, 2025, we generated $ 86,209,305 in revenue, of which 83.8 % was from Platforms and 16.2 % was from Agencies & Brands.

In the year ended December 31, 2024, we generated $ 83,793,859 in revenue, of which 82.8 % was from Platforms and 17.2 % was from Agencies & Brands.

Accounts receivable - Accounts receivable consist of trade receivables from customers and are recorded at their net realizable value.

We recognize an allowance for credit losses based on management’s best estimate of expected credit losses on existing accounts receivable.

Balances are written off against the allowance after all reasonable means of collection have been exhausted and the possibility of recovery is considered remote.

We estimate expected credit losses in accordance with the current expected credit loss (“CECL”) model under Topic 326, using comprehensive historical collection data, current customer-specific information, relevant economic indicators, and management judgment.

The allowance for credit losses is evaluated on a periodic basis and adjusted as necessary based on changes in facts and circumstances.

During the year ended December 31, 2025, we adopted Accounting Standards Update (“ASU”) 2025-05, Financial Instruments—Credit Losses (Topic 326):

Clarifying the Scope of the Current Expected Credit Losses Model.

The adoption of ASU 2025-05 did not have a material impact on our consolidated financial statements.

The following table presents accounts receivable, net of allowance for credit losses:

1 unchanged sentence

Balance at the end of the year

Cost of revenue - Cost of revenue is primarily composed of payments to advertising exchanges that provide access to digital inventory where we serve advertisements primarily for Agencies and Brands.

To a lesser extent, cost of revenue includes payments to website publishers and app developers that host advertisements.

Cost of revenue - During 2025, cost of revenue was primarily composed of payments to website publishers and app developers that host advertisements.

To a lesser extent, cost of revenue included payments to advertising exchanges that provide access to digital inventory where we serve advertisements primarily for Agencies and Brands.

Marketing costs - Marketing costs are predominately traffic acquisition costs and include those expenses required to attract an audience to our owned and operated applications and websites.

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We determined there was no impairment of goodwill during 2025 and 2024.

See Note 5 – Intangible Assets and Goodwill, for more information.

Intangible Assets - We allocate a portion of the purchase price of acquisitions to identifiable intangible assets and we amortize definite-lived assets over their estimated useful lives.

4 unchanged sentences

We recorded no impairment of intangible assets during 2025 or 2024.

See Note 5 – Intangible Assets and Goodwill, for more information.

Income taxes - We utilize the liability method of accounting for income taxes as set forth in ASC 740 , Income Taxes (“ASC 740”).

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We recognize compensation expense in earnings over the requisite service period, applying a forfeiture rate to account for expected forfeitures of awards.

See Note 10, Stock-Based Compensation, for further details on our stock awards.

Government Grant - During the first quarter of 2013, we received a grant from the state of Arkansas to relocate our corporate headquarters to Conway, AR.

Government Grant - During the first quarter of 2013, we received a grant from the state of Arkansas to relocate our corporate headquarters to Conway, Arkansas.

We recognized the grant funds into income as a reduction of the related expense in the period in which those expenses were recognized.

1 unchanged sentence

The agreement concluded on March 31, 2024, and as of December 31, 2025, all obligations were satisfied, and no liability remains outstanding.

As of December 31, 2023, we recorded a $ 35,000 liability which was satisfied in 2024.

During 2024, we derecognized a $ 35,000 liability.

Earnings per share - During the periods presented, we had securities that could potentially dilute basic earnings per share in the future but were excluded from the computation of diluted net loss per share, as their effect would have been anti-dilutive.

10 unchanged sentences

We maintain allowances for potential credit losses.

Customer concentrations - In 2024, we had one individual customer with revenue concentration greater than 10% of our total revenues accounting for 75.0 %, respectively.

Customer concentrations - In 2025, we had two individual customers with revenue concentration greater than 10% of our total revenues accounting for 64.2 % and 19.3 %, respectively.

At December 31, 2025, we had three individual customers greater than 10% of our total accounts receivable balance accounting for 17.9 %, 32.3 %, and 10.0 % respectively.

In 2024, we had one individual customer with revenue concentration greater than 10% of our total revenue accounting for 75.0 %, respectively.

At December 31, 2024, we had two individual customers greater than 10% of our total accounts receivable balance accounting for 58.5 % and 12.6 %, respectively.

In 2023, we had two individual customers with revenue concentration greater than 10% of our total revenue accounting for 60.4 % and 12.8 %, respectively.

At December 31, 2023, we had one customer greater than 10% of our total accounts receivable balance accounting for 50.5 %.

Vendor concentrations - In 2024, we had three individual vendors with cost of revenue concentration greater than 10% of our total cost of revenue accounting for 59.6 %, 25.6 %, and 10.3 % of the total cost of revenue, respectively.

In 2023, we had two individual vendors with cost of revenue concentration greater than 10% of our total cost of revenue accounting for 67.6 % and 15.3 % of the total cost of revenue, respectively.

Vendor concentrations - In 2025, we had two individual vendors with cost of revenue concentration greater than 10% of our total cost of revenue accounting for 65.2 % and 30.9 % of the total cost of revenue, respectively.

In 2024, we had three individual vendors with cost of revenue concentration greater than 10% of our total cost of revenue accounting for 59.6 %, 25.6 %, and 10.3 % of the total cost of revenue, respectively.

Use of estimates - The preparation of financial statements, in accordance with accounting principles generally accepted in the United States, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues and expenses and disclosure of contingent assets and liabilities.

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(i) information available prior to issuance of the consolidated financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred as of the date of the consolidated financial statements and (ii) the range of loss can be reasonably estimated.

Recently Adopted Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which requires retrospective disclosure of significant segment expenses and other segment items on an annual and interim basis.

Additionally, it requires disclosure of the title and position of the Chief Operating Decision Maker (“CODM”).

This ASU is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

See Note 12 for the impact of adoption of this accounting pronouncement.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU No.

1 unchanged sentence

Improvements to Income Tax Disclosures, which requires an annual tabular effective tax rate reconciliation disclosure including information for specified categories and jurisdiction levels, as well as, disclosure of income taxes paid, net of refunds received, disaggregated by federal, state/local, and significant foreign jurisdiction.

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

The adoption will have an impact on disclosures and not impact the Company’s consolidated results of operations, cash flows, nor financial position.

This ASU is effective for fiscal years beginning after December 15, 2024.

The adoption has an impact on disclosures with no impact on our consolidated results of operations, cash flows, nor financial position.

In March 2024, the FASB issued ASU No.

2024-03, Income Statement—Reporting Comprehensive Income (Topic 220):

Disaggregation of Income Statement Expenses, which requires additional disclosures of the nature of certain expenses within income statement captions.

The standard introduces a tabular disclosure of specified natural expense categories (e.g., inventory purchases, employee compensation, depreciation, amortization) included within relevant line items on the face of the income statement, along with qualitative descriptions of remaining amounts.

It also requires disclosure of certain expense, gain, or loss amounts already required under U.S.

GAAP and the total amount of selling expenses, including the definition of selling expenses in annual periods.

This ASU is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027.

The adoption will affect disclosures only and is not expected to impact our consolidated results of operations, cash flows, or financial position.

In September 2025, the Financial Accounting Standards Board (FASB) issued ASU No.

2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software, which modernizes guidance for internal-use software costs and relocates the website development-costs guidance (previously in Subtopic 350-50) into Subtopic 350-40.

The amendments require enhanced disclosures for capitalized software costs under ASC 350-40 and ASC 360-10, effective for annual periods beginning after December 15, 2027, with early adoption permitted.

The adoption is expected to affect disclosures only and is not anticipated to impact our consolidated results of operations, cash flows or financial position.

In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2025-05, Financial Instruments—Credit Losses (Topic 326):

Clarifying the Scope of the Current Expected Credit Losses Model, which clarifies the application of the CECL model to accounts receivable and certain other financial assets.

We adopted ASU 2025-05 during the year ended December 31, 2025.

The adoption did not have a material impact on the Company’s consolidated results of operations, cash flows, or financial position.

N ote 3 – Allowance for Credit Losses

1 unchanged sentence

Balance at the beginning of the year

Provision/(reversal of provision) for bad debts

Adjustment to expected losses on accounts receivable

( 1,442,533 )

1 unchanged sentence

The allowance for credit losses at December 31, 2025 was $ 98,954 , a decrease of $ 45,671 from December 31, 2024.

During 2024, we made an adjustment to the allowance for expected credit losses for a balance due from a former client in 2022.

The client has since paid off their full outstanding balance and no longer has any obligation to us as of December 31, 2024.

During 2024, we made an adjustment to reverse the allowance for expected credit losses for a balance due from a former client in 2022 for which we received payment in full during 2024.

Note 4– Property and Equipment

8 unchanged sentences

During the year ended December 31, 2025, we disposed of approximately $ 283,000 of fully depreciated equipment that was no longer in use.

There was no cash inflow or outflow associated with this transaction, and no gain or loss was recorded.

As the equipment was fully depreciated, there was no cash inflow or outflow associated with this transaction, and no gain or loss was recorded.

Note 5 – Intangible Assets and Goodwill

The following is a schedule of intangible assets and goodwill as of December 31, 2025:

Accumulated Amortization and Impairment

Accumulated Amortization

and Impairment

Net Carrying Value

Customer list, Google

$ ( 6,100,500 )

Customer list

( 1,931,250 )

Customer relationships

5 unchanged sentences

Accumulated Amortization

Net Carrying Value

Customer list, Google

$ ( 5,659,500 )

( 3,600,000 )

Customer list

( 1,931,250 )

Customer list, all other

( 1,610,000 )

Customer relationships

6 unchanged sentences

Note 6 – Bank Debt

On March 1, 2023, we entered into Amendment No.

1 to Loan and Security Agreement and Collateral Documents (“Agreement”) with Mitsubishi HC Capital America, Inc., f/k/a/ Hitachi Capital America Corp.

Under the terms of the Agreement, MHCA provided us with a $ 5,000,000 line of credit commitment.

We were permitted to borrow up to 85 % of the aggregate Eligible Accounts Receivable, up to the maximum credit commitment of $ 5,000,000 .

We paid MHCA monthly interest at the rate of 1.75 % in excess of the Wall Street Journal Prime Rate.

We paid MHCA an amendment fee of $ 10,000 on issuance of the Agreement, and thereafter an annual commitment fee of $ 10,000 .

We also paid MHCA a quarterly service fee of 0.20 % on the monthly unused amount of the maximum credit line.

All obligations to MHCA have been satisfied and the Agreement was terminated on July 31, 2024.

At December 31, 2024 and 2023, there were no outstanding balances due under the Agreement.

On July 30, 2024, we entered into a Financing and Security Agreement and Collateral Documents (“Financing Agreement”) with SLR Digital Finance LLC (“SLR”).

On July 30, 2024, we entered into the Financing Agreement with SLR.

Under the terms of the Financing Agreement, SLR has provided us with a $ 10,000,000 line of credit commitment.

We are permitted to borrow up to 90 % of eligible accounts receivable as defined in the Financing Agreement, up to the maximum credit commitment of $ 10,000,000 .

Availability as of December 31, 2024 equaled the maximum credit commitment of $10,000,000.

Borrowing capacity is determined based on the eligibility of our accounts receivable.

As of December 31, 2025, our accounts receivable, net of allowance for credit losses, totaled $ 5,887,884 of which a substantial portion qualified as eligible under the agreement.

The outstanding balance under the Financing Agreement at that date was $ 3,288,100 .

We will pay SLR monthly interest at the rate of 1.0% in excess of the Prime Rate but not less than 7% .

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We agreed to pay SLR an annual facility fee of 0.80 % of the maximum credit commitment.

We also agreed to pay a minimum utilization amount of the interest rate multiplied by difference between $ 500,000 and the average daily outstanding loan during a month.

We also agreed to pay a minimum utilization amount of the interest rate multiplied by the difference between $ 500,000 and the average daily outstanding loan during a month.

We are obligated to pay SLR a monthly service fee of 0.15 % of the average net amount of outstanding loans during each month.

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Repayment of the financing agreement will be made through collections from eligible accounts receivable.

At December 31, 2024, the outstanding balances due under the Financing Agreement was $0.

Note 7 – Accrued Expenses and Other Current Liabilities

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Accrued commissions and payroll

Arkansas grant contingency

Accrued taxes, current portion

Note 8 - Commitments

Note 8 – Business Development Agreement

On September 17, 2021, we signed a multi-year agreement with a business development partner to provide referral and support services to us.

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The advance was being amortized as marketing expenses over five years .

During the year ended December 31, 2024, we recorded an impairment to the asset bringing the balance to $ 0 , as no significant revenue has been realized within 2024 and therefore management determined future revenue under this arrangement is uncertain.

As of December 31, 2023, $ 700,000 had been amortized and the balance was $ 800,000 .

During the year ended December 31, 2024, we recorded amortization and impairment of the asset of $ 800,000 bringing the balance to $ 0 .

Note 9 – Income Taxes

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Current tax provision

Deferred tax (expense)/benefit

Total tax benefit

Deferred tax (expense)

Total tax (expense)

A reconciliation of the expected federal statutory rate to our actual rate as reported for each of the periods presented is as follows:

Federal statutory rate

$ ( 1,067,811 )

$ ( 1,209,978 )

State income tax rate, net of federal benefit

Permanent differences

Nontaxable and nondeductible items

Share-based payment awards

Change in valuation allowance

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For the year ended December 31, 2025, we recognized a deferred tax expense of $ 10,705 .

For the year ended December 31, 2023, we recognized a deferred tax benefit of $ 17,764 .

For the year ended December 31, 2024, we recognized a deferred tax expense of $ 8,030 .

When required, we record a liability for unrecognized tax positions, defined as the aggregate tax effect of differences between positions taken on tax returns and the benefits recognized in the financial statements.

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Accrued liabilities

Deferred rent

Allowance for credit losses

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Intangible assets and property and equipment

Amortization of Goodwill

Amortization of Goodwill and trade name

Net deferred tax liabilities

$ ( 107,971 )

The net operating losses amounted to approximately $ 119.8 million and expire beginning 2026 through 2038 .

Included in the federal net operating loss carryforwards are $ 51.2 million generated from 2018 to 2025 that will not expire and are limited to offset 80 % of our taxable income for years beginning after December 31, 2020.

As of December 31, 2024, the Company has a net deferred tax liability of $ 97,266 .

As of December 31, 2025, we have a net deferred tax liability of $ 107,971 .

The net deferred tax liability is due to goodwill that is amortized for tax purposes and a trade name that has an indefinite life, of which both are not being amortized for book purposes.

The deferred tax liability relating to goodwill and trade name can only be offset by 30% of interest limited by 163(j), the remainder, can be offset by up to 80 % by NOLs generated in tax years ending December 31, 2018 and beyond, subject to IRC Section 382 limitations.

The deferred tax liability relating to the amortization of goodwill and trade name can only be offset by 30% of interest limited by 163(j), the remainder, can be offset by up to 80 % by NOLs generated in tax years ending December 31, 2018 and beyond, subject to IRC Section 382 limitations.

The remaining portion that cannot be used remains as a liability.

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Subsequent ownership changes may further affect the limitation in future years.

The Company has not conducted a study to assess whether a change of control has occurred or whether there have been multiple changes of control since inception due to the significant complexity and cost associated with such a study.

If the Company has experienced a change of control, as defined by Section 382, at any time since inception, utilization of the net operating loss carryforwards would be subject to an annual limitation under Section 382, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term tax-exempt rate, and then could be subject to additional adjustments, as required.

We have not conducted a study to assess whether a change of control has occurred or whether there have been multiple changes of control since inception due to the significant complexity and cost associated with such a study.

If we have experienced a change of control, as defined by Section 382, at any time since inception, utilization of the net operating loss carryforwards would be subject to an annual limitation under Section 382, which is determined by first multiplying the value of our stock at the time of the ownership change by the applicable long-term tax-exempt rate, and then could be subject to additional adjustments, as required.

Any limitation may result in expiration of a portion of the net operating loss carryforwards before utilization.

Further, until a study is completed by the Company and any limitation is known, no amounts are being presented as an uncertain tax position.

The Company’s tax returns are subject to tax examinations by U.S.

Further, until a study is completed by us and any limitation is known, no amounts are being presented as an uncertain tax position.

Our tax returns are subject to tax examinations by U.S.

federal and state tax authorities until the respective statutes of limitation expire.

The Company is subject to tax examinations by tax authorities for all taxation years commencing on or after 2006.

We are subject to tax examinations by tax authorities for all taxation years commencing on or after 2021.

Carryforward attributes generated in all years since inception remain subject to adjustment.

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We maintain a stock-based compensation program intended to attract, retain and provide incentives for talented employees and directors and align stockholder and employee interests.

During the 2024 and 2023 periods, we granted restricted stock units ("RSUs") from the 2017 Equity Compensation Plan, as amended (“2017 ECP”).

During the 2025 and 2024 periods, we granted restricted stock units (“RSUs”) from the 2017 Equity Compensation Plan, as amended (“2017 ECP”) and the 2025 Omnibus Incentive Compensation Plan (“2025 Plan”).

RSU vesting periods are generally up to three years and/or achieving certain financial targets.

On January 1, 2022, in accordance with the plan provisions, the number of shares available for issuance under the 2017 ECP was increased by 150,000 shares.

On June 16, 2022, our stockholders approved an amendment to the 2017 ECP to cease the annual increase of 150,000 shares and a one time increase of the number of shares of our common stock reserved for issuance by 15,000,000 shares .

As of December 31, 2024, the total number of shares of our common stock reserved for issuance under the 2017 ECP was 24,550,000 .

On March 21, 2025, the Board of Directors adopted the 2025 Plan, approved by stockholders at the annual meeting held on May 22, 2025.

The 2025 Plan replaced the 2017 ECP for purposes of new awards.

All awards granted under the 2017 ECP prior to approval of the 2025 Plan remain outstanding and continue in full force and effect under the terms of the 2017 ECP;

however, no new awards may be granted under the 2017 ECP following the effective date of the 2025 Plan.

As of December 31, 2025, shares subject to outstanding awards under the 2017 ECP and 2025 Plan were 625,979 and 154,000 shares, respectively.

Shares available for future grant under the 2025 Plan at December 31, 2025, were 965,885 .

As of December 31, 2025, the total share reserve authorized under 2025 Plan was 1,119,885 shares.

Compensation Expense

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Total compensation cost not yet recognized at December 31, 2025 was $ 1,539,082 which will be recognized over the next three years.

The following table summarizes the stock grants outstanding under our 2017 ECP plan as of December 31, 2024:

The following table summarizes the stock grants outstanding under 2017 ECP and 2025 Plan as of December 31, 2025:

Options Outstanding

RSUs Exercised/Vested

RSUs Outstanding

Options and RSUs Exercised/Vested

Available Shares

Total Shares (Outstanding + Available)

The fair value of restricted stock units is determined using market value of the common stock on the date of the grant.

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The forfeiture rate, which is estimated at a weighted average of 0% of unvested options outstanding, is adjusted periodically based on the extent to which actual forfeitures differ, or are expected to differ, from the previous estimate.

The following table summarizes the weighted average assumptions for our granted options and RSUs.

There were no options granted in the period ended December 31, 2025.

The following table summarizes our restricted stock unit activity for 2025:

Weighted Average Fair Value

Outstanding, beginning of year

( 3,379,995 )

Outstanding, end of year

Note 11 – Stockholders’ Equity

On May 30, 2023, we raised $ 4.0 million in gross proceeds in a registered direct offering, before expenses, through the sale of an aggregate of 16,000,000 shares of our common stock.

On September 17, 2021, we signed an agreement with a marketing platform and consulting company to provide referral and support services to us for a period of five years (see Note 8 – Commitments).

Sales of Common Stock Under At-the-Market Offering

On May 7, 2024, we entered into an At-the-Market Offering Agreement (the “ATM Agreement”) with H.C.

Wainwright & Co., LLC, pursuant to which we may offer and sell shares of its common stock, par value $ 0.001 per share, having an aggregate offering price of up to $ 15.0 million.

During the year ended December 31, 2025, we sold 165,641 shares of common stock under the ATM Agreement for gross proceeds of $ 1,184,740 , before deducting commissions and other offering-related costs.

Net proceeds of $ 1,149,288 from these sales were recorded in additional paid-in capital within stockholders’ equity.

Reverse Stock Split

On June 10, 2025, we effected a 1-for-10 reverse stock split of its issued and outstanding common stock.

As a result of the reverse stock split, every ten shares of our issued and outstanding common stock were automatically converted into one share of common stock, without any change in the par value per share.

No fractional shares were issued as a result of the reverse stock split.

Instead, stockholders entitled to receive a fractional share received a whole share rounded up.

The reverse stock split did not affect the total number of authorized shares of common stock or the par value of common stock.

All share and per share amounts for all periods presented in the accompanying financial statements and notes have been retroactively adjusted to reflect the reverse stock split.

On September 17, 2021, we signed an agreement with a marketing platform and consulting company to provide referral and support services to us for a period of five years (see Note 8 – Business Development Agreement).

As part of that agreement, we granted a seven year warrant exercisable into 30,000 shares of our common stock, at $ 7.20 per share, which vests in two tranches when certain performance metrics are achieved.

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The warrant is classified as equity and will be expensed over the vesting period of each tranche if the performance criteria are achieved.

On August 31, 2022, 85,862 shares vested in accordance with the contracted performance criteria.

On August 31, 2023, 21,136 shares vested.

For the second tranche, we reversed approximately $ 7,900 for the year ended December 31, 2023 due to a change in the probability of performance criteria being achieved.

In accordance with our agreement, after the second anniversary of the original issue date of the warrants, any interests in warrant shares that have not vested pursuant to the terms and conditions of the agreement were deemed forfeited and shall never become exercisable.

At the period ended December 31, 2025, approximately 19,300 shares have been forfeited and approximately 10,700 shares underlying the warrant have vested.

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Note 12 – Segment Reporting

(the "Company") operates as a single reportable segment that places digital advertising throughout devices, websites, applications and browsers across social, search and programmatic advertising channels, facilitating the delivery of millions of advertising messages monthly.

The Chief Operating Decision Maker ("CODM"), identified as the Chief Executive Officer, evaluates the Company's financial performance and makes resource allocation decisions based on consolidated financial information

We operate as a single reportable segment that places digital advertising throughout devices, websites, applications and browsers across social, search and programmatic advertising channels, facilitating the delivery of millions of advertising messages monthly.

The Chief Operating Decision Maker (“CODM”), identified as the Chief Executive Officer, evaluates our financial performance and makes resource allocation decisions based on consolidated financial information

Measure of Segment Profit or Loss

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Significant Segment Expenses

The Company reports total revenue and significant expenses provided to the CODM, which include cost of revenue, marketing, and compensation expenses.

We report total revenue and significant expenses provided to the CODM, which include cost of revenue, marketing, and compensation expenses.

These expenses are regularly reviewed to assess operating performance.

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Professional Fees

Provision/(reversal of provision) for bad debts

Changes of reserves for credit loss

( 1,442,533 )

Depreciation and Amortization

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Geographic Information

The Company's operations are based in the United States, and substantially all revenue is derived from U.S.

Our operations are based in the United States, and substantially all revenue is derived from U.S.

Note 13 – Retirement Plan Costs

We provide a 401(k) plan to help our employees prepare for retirement where we matched each employee's contributions to the plan up to the first four % of the employee's annual salary.

We provide a 401(k) plan to help our employees prepare for retirement where we matched each employee’s contributions to the plan up to the first four percent of the employee’s annual salary.

The matching contribution for the years ended 2025 and 2024 was $ 369,567 and $ 383,649 , respectively.

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As of December 31, 2025 and December 31, 2024, total operating and financed right-of-use assets were $ 663,635 and $ 0 , and $ 913,439 and $ 18,209 , respectively.

For the years-ended December 31, 2024 and 2023, we recorded $ 54,356 and $ 96,190 in amortization expense related to finance leases.

For the years-ended December 31, 2025 and 2024, we recorded $ 18,209 and $ 54,356 , respectively, in amortization expense related to finance leases.

For the years-ended December 31, 2025 and 2024, we recorded $ 334,888 and $ 334,243 respectively, in rent expense related to operating leases.

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Weighted-average discount rate

Minimum future lease payments ended December 31, 2024

Less imputed interest

Total lease liabilities

Note 15 – Related Parties

During August 2023, we entered into a referral agreement with a board member of the Company.

An initial fee of $ 15,000 was agreed upon, payable upon the execution of the agreement.

Subsequently, a monthly retainer of $ 5,000 , paid in advance, was established, starting from September 1, 2023.

Either party has the right to terminate this agreement at any time and for any reason.

Termination requires fourteen (14) days written notice to be provided to the other party.

For the twelve months ended December 31, 2024, we recognized approximately $ 15,000 in expense.

For the twelve months ended December 31, 2023, we recognized approximately $ 35,000 in expense.

During the year ended December 31, 2024, the Company engaged in a transaction with First Orion Corp., a company in which one of our directors holds a significant interest.

The transaction involved the sale of services amounting to approximately $ 95,000 .

These transactions were conducted in the ordinary course of business.

During the year ended December 31, 2024, the Company engaged in a transaction with James & James, a company in which one of our directors holds a significant interest.

The transaction involved the sale of services amounting to approximately $ 170,000 .

These transactions were conducted in the ordinary course of business.

During the year ended December 31, 2025, Gabriel Court Consortium, LLC, a company in which one of our directors holds a significant interest, provided services to us.

Expense from the transaction amounted to approximately $ 40,000 .

Note 16 – Subsequent Event

In January 2025, Inuvo, Inc.

utilized the ATM Agreement (see Note 1 – Organization and Business) and we sold 1,594,313 shares of common stock for gross proceeds of $ 1,163,491 .

The ATM program allows the Company to raise capital from time to time through sales of common stock at prevailing market prices, subject to volume limitations and market conditions.

The proceeds from the ATM offering are intended to be used for general corporate purposes, including working capital, strategic investments, and operational expansion.

On January 14, 2026, we entered into a securities purchase agreement with certain investors pursuant to which we authorized the issuance of subordinated convertible notes in the aggregate principal amount of approximately $ 3.33 million, subject to a 10 % original issue discount.

On January 29, 2026, we received gross proceeds of approximately $ 6.2 million in connection with a class action settlement.

The settlement proceeds represent a one-time, non-recurring cash inflow.

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

What changed 10-K

Item 9A. Controls and Procedures