UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
(Mark One)
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2025
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period
from to
Commission File Number: 001-41375
Actelis Networks, Inc.
(Exact Name of Registrant as Specified in Its
Charter)
(Address of Principal Executive Offices) (Zip Code)
(510)545-1045
(Registrant’s Telephone Number, Including
Area Code)
Securities registered pursuant to Section 12(b)
of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common stock, par value $0.0001 per share ASNS The Nasdaq Stock Market LLC
Securities registered pursuant to Section 12(g)
of the Act: None
Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No☒
Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No☒
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”,
and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Emerging growth company ☒
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report. ☐
If securities are registered pursuant to Section
12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction
of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error
corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s
executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of voting and non-voting common equity held
by non-affiliates of the registrant as of June 30, 2025, the last business day of the registrant’s most recently completed second
fiscal quarter, was approximately $5.7 million based on the closing sale price on that date of $6.15. Shares of common stock held by each
executive officer and director and by each other person who may be deemed to be an affiliate of the Registrant have been excluded from
this computation. The determination of affiliate status for this purpose is not necessarily a conclusive determination for other purposes.
As of March 15, 2026, there were 26,725,763 shares of the registrant’s
common stock, par value $0.0001 per share, outstanding, including treasury shares.
ACTELIS NETWORKS, INC.
FORM 10-K
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2025
TABLE OF CONTENTS
PART I
ITEM 1. BUSINESS 1
ITEM 1A. RISK FACTORS 24
ITEM 1B. UNRESOLVED STAFF COMMENTS 51
ITEM 1C. CYBERSECURITY 51
ITEM 2. PROPERTIES 51
ITEM 3. LEGAL PROCEEDINGS 51
ITEM 4. MINE SAFETY DISCLOSURES 51
PART II
ITEM 6. [RESERVED] 52
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 63
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA F-1
ITEM 9A. CONTROLS AND PROCEDURES 64
ITEM 9B. OTHER INFORMATION 64
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 64
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 65
ITEM 11. EXECUTIVE COMPENSATION 72
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 85
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 86
SIGNATURES 88
i
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form
10-K (the “Annual Report”) contains forward-looking statements. The forward-looking statements are contained principally in
the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results
of Operations,” and “Business.” These forward-looking statements involve a number of risks and uncertainties. We caution
readers that any forward-looking statement is not a guarantee of future performance and that actual results could differ materially from
those contained in the forward-looking statement. These statements are based on current expectations of future events. Such statements
include, but are not limited to, statements about future financial and operating results, plans, objectives, expectations and intentions,
costs and expenses, interest rates, outcome of contingencies, financial condition, results of operations, liquidity, cost savings, objectives
of management, business strategies, financing, potential growth and market opportunities, products, and other statements that are not
historical facts.
In some cases, you can identify
forward-looking statements by terms such as “may,” “will,” “should,” “would,” “expect,”
“anticipate” “plan,” “anticipate,” “could,” “intend,” “target,”
“project,” “contemplate,” “believe,” “estimate,” “predict,” “potential”
“possible” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements
contained in this Annual Report include, but are not limited to, statements about:
● our ability to protect our intellectual property and continue to innovate;
● our ability to continue as a going concern;
● our public securities’ potential liquidity and trading; and
Forward-looking statements
are based on our management’s current expectations, estimates, forecasts and projections about our business and the industry in
which we operate and our management’s beliefs and assumptions, and are not guarantees of future performance or development and involve
known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking
statements in this Annual Report may turn out to be inaccurate. Important factors that may cause actual results to differ materially from
current expectations include, among other things, those listed under “Risk Factors,” Use of Discussion and Analysis of Financial
Condition and Results of Operations,” “Business” and elsewhere in this Annual Report. Potential investors are urged
to consider these factors carefully in evaluating the forward-looking statements. You should read thoroughly this Annual Report and the
documents that we refer to with the understanding that our actual future results may be materially different from and worse than what
we expect. We qualify all of our forward-looking statements by these cautionary statements.
The forward-looking statements
included in this Annual Report speak only as of the date of this Annual Report. Although we believe that the expectations reflected in
the forward-looking statements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and
circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by law, we assume no obligation
to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should,
however, review the factors and risks we describe in the reports we will file from time to time with the SEC after the date of this Annual
Report. See “Where You Can Find More Information.”
On November 18, 2025, we
effected a reverse stock split of our shares of common stock at the ratio of 1-for-10. Unless indicated otherwise by the context, all
common stock, option, warrant and per share amounts as well as share prices appearing this Annual Report on Form 10-K have been adjusted
to give retroactive effect to the stock split for all periods presented.
ii
Item 1. Business
Company Overview
Actelis Networks, Inc. (“Actelis,”
“we,” “us,” “our,” “the Company,” “our company”) is a market leader in cyber-hardened,
rapid-deployment networking solutions for wide-area applications including federal and military, state and local government, intelligent
traffic systems (“ITS”), and additional IoT environments such as utility and rail. We also provide Multi-Dwelling Units (“MDU”)
both inside and outside of building solutions to modernize and protect infrastructure using existing infrastructure. Through our “Cyber
Aware Networking” initiative, we provide AI-based cyber monitoring and protection software for all edge devices, enhancing cyber
security and resilience. Our unique portfolio of hybrid fiber, cyber hardened aggregation switches, high density Ethernet devices, advanced
management software and cyber-protection capabilities, unlocks the hidden value of essential networks, delivering safer connectivity for
rapid, cost-effective deployment.
Critical Trends Affecting Communication Needs
Today
Three significant global
shifts are affecting the world today, and particularly the need for vast and rapid modernization of communication and networking infrastructure.
The first major shift is
the accelerating rise of AI adoption, which demands ever-expanding computational resources to sustain its growth. As this trend continues,
AI as an automation capability is becoming increasingly fluid, moving across the cloud, the data center, and the network edge where users
and devices are directly served. This redistribution is driven both by the intolerance for latency and by the resource constraints within
centralized data centers. The network becomes the essential conduit enabling this movement, carrying the data and intelligence required
to position AI workloads wherever they can operate most effectively.
The second shift is to defense
and advanced defense technologies, shaped by current geopolitical tension and realizations many countries, including the United States,
are making. This defense which includes homeland security, cyber security and operational continuity are requiring critical modernization
of networking as well. For example, the recent 2025 outages experienced in Air Traffic Control in New Jersey and Pennsylvania drove an
urgent approval of over $12 billion dollars of modernization budget for the FAA (Federal Aviation Administration) networks. Similarly,
military environments are modernizing rapidly to be ready for development.
The third shift, albeit not
new, is cyber security as a pillar of operations in general. As the network may typically be the weakest link, its criticality as a cyber-safe
medium is obvious.
These trends receive vast
budgets, require very rapid progress and as such, the use of existing infrastructure. Actelis offers its solutions right in the center
of such intersection, we explain hereafter how this is done.
Our networking solutions use a combination of newly deployed fiber
infrastructure and existing copper and coaxial lines which our patented technology can upgrade to Fiber-grade to jointly create what we
believe to be a highly cost-effective, secure, and quick-to-deploy network. Our patent protected hybrid fiber networking solutions deliver
excellent communication over fiber to locations that may be easy to reach with new fiber. However, for locations that are difficult, or
too costly to reach with fiber, we can upgrade existing copper lines to deliver cyber-hardened, high-speed connectivity without needing
to replace the existing copper infrastructure with new fiber. We believe that such hybrid fiber copper networking solution has distinct
advantages in most real-life installations, while providing significant budget savings and accelerating deployment of modern IoT networks.
Based on our experience, most IoT projects have challenging, hard to reach with fiber locations which may explode such projects’
timeline and budgets. We believe that our solutions can provide connectivity over either fiber or copper with speeds of up to multi-Gigabit
communication, while supporting Fiber-grade reliability and quality.
A primary focus of ours is
to provide our customers with a cyber-secure network solution. We currently offer Triple-Shield protection of data delivered with coding,
scrambling and encryption of the network traffic. We also provide secure, encrypted access to our network management software, and are
working to further enhance system-level and device-level software protection. We are also working to introduce additional capabilities
for network-wide cyber protection software as an additional SW and license-based services.
When high speed, long reach,
reliable and secure connectivity is required, network operators usually resort to using wireline communication over physical communication
lines such as fiber, coax, and copper, rather than wireless communication that is more limited in performance, reliability, reach and
security. However, new fiber wireline infrastructure is costly to deploy, involves lengthy civil works to install, and, based on our internal
calculations, often accounts for more than 50% of total cost of ownership and time to deploy wide-area IoT projects.
Providing new fiber connectivity
to hard-to-reach locations is especially costly and time-consuming, often requiring permits for boring, trenching, and right-of-way, sometimes
done over many miles. Connecting such hard-to-reach locations may cause significant delays and budget overruns in IoT projects. Our solutions
aim to solve these challenges by instantly enhancing performance of such existing copper and coax infrastructure to fiber-grade performance,
through the use of advanced signal processing and unique, patented network architecture, without the need to run new fiber to hard-to-reach
locations; thus, effectively accelerating deployment of many IoT projects, as we estimate, sometimes from many months to only days. The
result for the network owner is a hybrid network that optimizes the use of both new Fiber (where available) as well as upgraded, fiber-grade
copper and coax that is now modernized, digitized and cyber-hardened. This unique hybrid network approach is making IoT projects often
significantly more affordable, fast to deploy and predictable to plan and budget.
1
In addition, our solutions
can also provide power over existing copper and coax lines to remotely power up network elements and components connected to them (like
cameras, small cell and Wi-Fi base stations sensors etc.). Connecting power lines to millions of locations can be costly and very time
consuming as well (similar to data connectivity, for the same reason — need for civil works). By offering the ability to combine
power delivery over the same existing copper and coax lines that we use for high-speed data, we believe our solutions are solving yet
another important challenge in connecting hard-to-reach locations. We believe that combining communication and power over the same existing
lines is particularly important to help connect many fifth generation, or 5G, small cells and Wi-Fi base stations, as high cost of connectivity
and power is often slowing their deployment.
Since our inception, our
business was focused on serving telecommunication service providers, also known as Telcos, to provide connectivity for enterprises and
residential customers. Our products and solutions have been deployed with hundreds of telecommunication service providers worldwide, in
enterprise, residential and mobile base station connectivity applications. In recent years, as we have further developed our technology
and introduced additional products, we turned our focus on serving the wide-area IoT, federal and U.S. Department of War (“DoW”)
markets, as well as multi-dwelling units, and introduced, in 2024, our cyber-aware networking solutions for IoT markets as well.
In December 2024, we
launched our MetaShield AI-Powered SaaS solution, under Actelis’ ‘Cyber Aware Networking’ initiative. This includes
a software based platform designed as an intelligence layer integrated into Actelis’ networking devices, leverages the network’s
power and proximity to IoT devices to monitor and protect physical assets such as cameras, sensors, and other devices at the edge, enabling
corrective actions before issues propagate throughout the network.
We derive a majority of our
revenues from our existing and new IoT (including federal and DoW) customers. For the years ended December 31, 2025 and December 31,
2024, our IoT customers in the aggregate accounted for approximately 73% and 72% of our revenues, respectively.
We derive a significant portion
of our revenues from a limited number of our customers. For the years ended December 31, 2025 and December 31, 2024, our
top ten customers in the aggregate accounted for approximately 62% and 74% of our revenues.
We have incurred significant
losses and negative cash flows from operations and as of December 31, 2025, we had an accumulated deficit of $52 million. We have
funded our operations to date through equity and debt financing and we had cash on hand (including short term bank deposits and restricted
cash equivalents) of $4.4 million and long-term restricted cash and cash equivalents and restricted bank deposits of $0.2 million as of
December 31, 2025. We continue to invest in sales and marketing resources to fuel our growth.
Our technology is both powerful
and compact and is built as a relatively small set of feature-rich network elements, that serve as building block in the verticals we
serve, namely Federal and Military, Intelligent Transportation, and MDUs. These elements include switches, typically enhanced with signal
processing software, concentrators, reach extenders, data encryption elements, power sources and a smart networking software that allows
for remote management and monitoring down to the single element and line performance, configuration management making complex network
topologies easy to deploy, analyze, debug and remote software download to help with remote handling of large and small networks, on any
wired infrastructure – be it Fiber, Copper or Coax. At the same time, we continue to serve our long-standing Telco customers in
their hybrid communications needs. As cyber security standards tighten worldwide, in second half of 2025, we started offering customers
on-going monitoring of vulnerabilities through our scanning and analysis tools for new developments in this industry, to keep and safeguard
their networks when new threats become known or existing threats become relevant to their environment.
Our cyber-security offerings
include various embedded cyber-hardening features, such as encryption, our SaaS-based MetaShield platform, as well as vulnerability monitoring
and analytics services, and embedded software improvements offered to existing customers in the form of software upgrades. As such, we
allow continuous protection through learning of both the network elements as well as the devices connected to them, delivering constant
alerting and review against external data bases of known threats, and offer software upgrades that overcome newly known or identified
vulnerabilities, creating a repeatable, ever-improving protection cycle.
Rapid Deployment and Lower Cost of Critical
Connectivity
We aim to become the global
leading provider of cyber-secure, cost-effective and quick-to-deploy hybrid networking for all wide-area applications. Our products work
over all types of wireline media on the global data network, whether owned or operated by telecom service providers or a private network
operated by enterprises or government organizations as well as MDU buildings. Our products are structured as building blocks especially
for Intelligent Transportation Systems (ITS), including roads, rail and airport applications that are feature-rich. This allows for one
Actelis platform to often replace multiple other platforms available in the market, allowing for space-saving installation, energy conservation
(which we believe results in a more environmentally sustainable network, through the avoidance of need to add new physical infrastructure),
and making network planning easier for our customers. We aim at having our products installed and help accelerate deployment of wire-area
IoT projects and applications everywhere.
2
For example, in one of the
projects where our solutions are deployed, we found that 70% of locations are easy-to-reach with new fiber optic installation. Connectivity
for such easy-to-reach locations may, as we believe, average $26,000 per mile for new fiber laid on poles, and can take between days
to weeks to connect. However, the remaining 30% of locations were hard-to-reach with new fiber optics, and accordingly may require
boring or trenching to reach IoT sensors or camera locations. Getting fiber to those 30% of hard-to-reach would require potentially connecting
over obstacles, roads, long distances, and may also require obtaining the right of way and permits for extensive civil works. We believe
this aspect of the deployment of new fiber optics may cost up to $400,000 per mile, which for this particular project would have impacted
thousands of miles of roads, resulting in enormous cost, delay and interruption to traffic.
In another project, we have
been selected to provide networking for a major city that has fiber installed to 15% of its traffic junctions, however 85% of its junctions
are connected to low performance copper lines susceptible for bad actors to tamper with. Upgrading the entire city’s infrastructure
to Fiber would have involved major civil works, permit delays and traffic interruptions for months or years, with a cost that
would greatly exceed city’s budget. Our hybrid fiber network allowed for the city to use its 15% fiber deployment, upgrade instantly
the performance of its existing 85% copper lines to fiber-grade and join the two under a comprehensive management and security software
package from Actelis to create one seamless network, while providing major savings of both time and money.
In recent years, we have significantly
advanced our product offerings. In 2022, we launched our family of hardened, hybrid, encrypted fiber products with 10Gbps switching capacity.
Following that, in 2023 and 2024 we introduced and refined the next-generation “Gigaline” product families, providing hybrid-fiber
Gigabit-grade connectivity across fiber, copper, and coax environments, which addressed new challenges for ITS and telecom customers and
further enhanced our multi-gigabit products to support a broader range of use-cases. In 2025, we expanded our offering with the launch
for large Coax environments, expanded our offering with fiber only solutions and introduced the MetaShield cyber-aware networking product
family.
Cybersecurity
Networking systems are vulnerable
to cyber-attacks, as they often carry data related to critical processes and applications, such as provision of energy, water, gas and
transportation services, to large populations. At the same time, they are often found in the wide range, meaning, in public locations,
adding further risks of tampering and break-ins.
In 2024 we signed a strategic
partnership with a cyber-security development company, which helped us launch our new cyber-aware networking solution for IoT networks.
Later that year, we launched our MetaShield SaaS product as a cyber-security solution that comes from the network itself, and has since
then been introduced to our existing and new customers.
Our products all include
cyber safety features that we are constantly developing. They currently include network traffic encryption and coding. We have developed
and implemented a multi-layered “Triple Shield” technology that includes (i) information coding for resilience and security
(for copper wires); (ii) multi-line information scrambling for increased resilience and added security (for copper wires); and (iii) an
additional 256-bit hardware-based real-time encryption of data running over fiber, coax or copper — creating end-to-end
protection for the entire hybrid network. Our network management software is also cyber-hardened and helps protect the system. Our systems
have been selected for deployment in sensitive applications with U.S. DoW and other governments and military organizations, airports,
utility companies, oil and gas companies, smart cities, rail and traffic applications globally.
In 2024, we successfully
completed the certification of our product lines for Federal Intelligence Protocol Standards (FIPS) 140-2 and were approved by the DoW’s
Joint Interoperability Test Command (JITC) for interoperability and cybersecurity, allowing our products to be included in several federal
approved product lists (APL). In February 2026 we have deployed the next generation of FIPS standard requirements in our product portfolio
(140-3).
3
In 2025, we enhanced our
service capabilities in monitoring and analysis of market and industry vulnerabilities, existing and new. This helps us offer such monitoring
services to our customers to protect their installed base, while offering embedded and management software upgrades that are in-line with
the threats that need mitigation. This further reflects the fact Cybersecurity is central to optimizing and modernizing networking solutions.
Market Verticals We Address
We execute our vision through
a multi-channel, global approach that combines our expertise, with the expertise of our trusted business partners, system integrators,
distributors, and consultants.
We operate a vertical-based
marketing plan where we dedicate efforts and resources to each vertical. The verticals we focus on include: Federal and military, intelligent
transportation systems (ITS), smart city, rail, airports. We also address utilities and campuses. .. In 2024, we launched our MDU program
, which was further expanded in 2025 to address increasing building sizes as well as arenas. The MDU vertical requires networking solutions
for residential buildings with multiple units, such as apartment complexes and condominiums as well as hospitality properties such as
hotels and resorts, connecting each unit to high-speed internet, using the infrastructure present, be it Coax, fiber or copper, and tailor
it to the size of the building, from a dozen units to hundreds and thousands of them.
Our solutions are utilized
within networks deployed by cities such as the City of Los Angeles, the District of Columbia, Montgomery County, MD, the City of Seattle,
the Cities of Munich, Frankfurt, Cologne and others in Germany, as well as notable entities such as Highways England, the Federal Aviation
Administration, the Autostrada in Italy, the U.S. military, including the Air Force, Navy and National Guard, as well as Stanford University.
In 2025, We received our first hotel implementation in the U.S., through a global strategic partnership with a hospitality guest experience
platform provider.
Our customers benefit from
rapidly and cost-effectively enabling their critical functions such as traffic cameras and smart signaling, security cameras, smart parking
meters and ticketing, rail signaling and control, electrical substation management and protection, military operations, and many more.
Recently, Actelis Networks has secured significant orders and launched groundbreaking solutions like MetaShield, an AI-based cybersecurity
solution, driving SaaS growth and edge infrastructure resilience. To date, we have been most successful in selling to customers in the
intelligent transportation systems, rail, federal and military, airports, and MDU markets, primarily in the US, Canada, Europe, and Japan.
Recent Trends in our Markets
State of Connectivity Market, including Federal,
Military and MDUs
Edge AI, also covered as
edge computing, according to Grandview research is projected to grow from approximately $20 billion in 2024 to nearly $190 billion in
2033. According to US Congress’ budgeting program projections, US military base modernization budgets in 2025 were $37 billion as
part of a model projecting the Federal Defense program to grow to over $850 billing in 2029. With that, the already robust cyber-security
market, according to Grandview research the global cyber-security market is projected to grow from approximately $240 billion in 2024
to nearly $500 billion in 2033. With these trends, infrastructure network connectivity demand is growing very rapidly. According to Markets
and Markets, the Smart Transportation market is projected to grow to over $250 Billion by 2029, largely for intelligent transportation
modernization. We believe there is an urgent need to connect tens of millions of locations with a fast and secure connection. A huge challenge
for ITS projects is that implementing connectivity between different points in a network can consume the majority of a project’s
cost and time to implement, including unpredictable and unanticipated challenges that arise in each individual project.
4
We believe that the number
of IoT applications requiring our fast, smart, and secure connectivity is immense and provides us with a great market opportunity to grow
our business. From smart transportation systems (smart cameras, smart lights and signals, Vehicle to Everything, or V2X communication)
and smart security (cameras and radars), to smart parking, smart rail, as well as airport and air traffic control infrastructure, also
manifested by the $12.5 billion budget granted to the FAA in 2025, we believe that we are uniquely positioned to address all of these
applications in a versatile and flexible manner.
In the MDU market, which
we believe is in dire need for multi-Gigabit connectivity, and is extremely limited in its ability to invest significant funds to enable
such objective. According to US Census.gov, there are approximately 20 million buildings above 5 units built by the year 2000, most of
which already wired by various infrastructures. The Broadband Equity program or BEAD has allotted $28 billion already to all 50 states
to modernize and provide high-speed reliable internet including underserved communities, as part of the Infrastructure Act.
Recent Developments
July 2025 Private Placement
On June 30, 2025, we entered
into a securities purchase agreement (the “July 2025 Purchase Agreement”) with certain accredited investors (the “Investors”),
pursuant to which we agreed to issue and sell to the Investors in a private placement (the “July 2025 Private Placement” or
the “July 2025 Offering”) (a) 162,602 shares of Common Stock, (b) Series A-3 warrants (the “Series A-3 Warrants”)
to purchase up to 162,602 shares of Common Stock, and (c) Series A-4 warrants (the “Series A-4 Warrants”, and, with the Series
A-3 Warrants, the “July 2025 Common Warrants”) to purchase up to 325,204 shares of Common Stock, for a purchase price of $6.15
per share and related July 2025 Common Warrants, for a total aggregate gross proceeds of approximately $1 million. The July 2025 Private
Placement closed on July 2, 2025.
The Series A-3 Warrants have
an exercise price of $6.15 per share, are exercisable commencing on the effective date of shareholder approval (the “July 2025 Shareholder
Approval Date”) of the issuance of the shares issuable upon exercise of the Common Warrants (“July 2025 Shareholder Approval”)
and expire five years following the Shareholder Approval Date. On November 7, 2025, the July 2025 Shareholder Approval was obtained in
a special meeting of our shareholders, resulting in the July 2025 Shareholder Approval Date being such date.
The Series A-4 Warrants have
an exercise price of $6.15 per share, are exercisable commencing on the July 2025 Shareholder Approval Date and expire eighteen months
following the July 2025 Shareholder Approval Date.
Under the terms of the July
2025 Common Warrants, the warrant holders may not exercise the warrants to the extent such exercise would cause the warrant holder, together
with its affiliates and attribution parties, to beneficially own a number of shares of common stock which would exceed 4.99% (or, at such
Investor’s option upon issuance, 9.99%), of the Company’s then outstanding Common Stock following such exercise, excluding
for purposes of such determination shares of Common Stock issuable upon exercise of such warrants which have not been exercised.
H.C. Wainwright & Co.,
LLC (“HCW”) acted as the placement agent for the issuance and sale of the Securities. The Company has agreed to pay an aggregate
cash fee equal to 7.0% of the gross proceeds received by the Company from the July 2025 Offering and $35,000 for accountable expenses
to the placement agent. The Company also agreed to issue to the placement agent, or its designees, Placement Agent Warrants to purchase
up to 7.0% of the aggregate number of the shares of Common Stock sold to the Investors (or warrants to purchase up to 11,382 shares of
Common Stock) at an exercise price per share of $7.688 which will be exercisable commencing on the Shareholder Approval Date and a have
term of five years after the July 2025 Shareholder Approval Date (the “July 2025 Placement Agent Warrants,”).
The July 2025 Placement Agent
Warrants and the shares of Common Stock issuable upon exercise thereof, will be issued in reliance on the exemption from registration
provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering and in reliance on similar exemptions
under applicable state laws.
5
Nasdaq Listing Compliance
On August 25, 2023, we received
a notification letter from the Listing Qualifications Staff (the “Staff”) of Nasdaq indicating that we are not in compliance
with Nasdaq Listing Rule 5550(b)(1) due to our failure to maintain a minimum of $2,500,000 in shareholders’ equity (the “Minimum
Shareholders’ Equity Requirement”) or any alternatives to such requirement. In order to maintain our listing on the Nasdaq
Capital Market, we submitted a plan of compliance addressing how we intended to regain compliance. On March 27, 2024, we received a delist
determination letter from Nasdaq advising us that the Staff had determined to delist our securities from Nasdaq due to non-compliance
with the Minimum Shareholders’ Equity Requirement, unless we timely request a hearing before the Nasdaq Hearings Panel (the “Panel”).
We timely requested a hearing before the Panel.
On August 27, 2024, we received
formal written notice from Nasdaq confirming that we have evidenced compliance with all applicable criteria for continued listing on Nasdaq
as set forth in Nasdaq Listing Rule 5550, including the Minimum Shareholders’ Equity Requirement. In accordance with Nasdaq Listing
Rule 5815(d)(4)(B), we remained subject to a panel monitor for equity compliance through August 27, 2025.
On May 12, 2025, Nasdaq notified
us (the “Notification Letter”) that we were not in compliance with Nasdaq Listing Rule 5550(a)(2), which requires our Common
Stock to maintain a minimum bid price of $1.00 per share (the “Bid Price Rule”). The Notification Letter had no immediate
effect on the listing or trading of our Common Stock on Nasdaq and, at this time, the Common Stock will continue to trade on Nasdaq under
the symbol “ASNS”. The Notification Letter provided that we have 180 calendar days, or until November 10, 2025, to regain
compliance with the Bid Price Rule.
On August 19, 2025, we received
written notice from Nasdaq stating that, due to the Company’s non-compliance with the Minimum Shareholders’ Equity Requirement
as of June 30, 2025, and because, pursuant to Listing Rule 5815(d)(4)(B), the Company remained subject to a mandatory hearing panel monitor
through August 27, 2025, the Company’s securities were subject to delisting from Nasdaq unless the Company timely requests a hearing
before the Nasdaq Hearing Panel (the “Panel”). The Company had its hearing with the Panel on September 30, 2025.
At the hearing, the Company
presented its plan to evidence compliance with the Equity Rule and all other applicable criteria for continued listing on The Nasdaq Capital
Market, and requested to remain listed subject to its plan to regain compliance.
On October 28, 2025, we received
a listing decision from Nasdaq notifying us that the Panel determined that the Company evidenced compliance with the Shareholders’
Equity Requirement.
The Panel also granted the
Company’s request for continued listing on The Nasdaq Capital Market, pursuant to an exception through December 5, 2025, to regain
compliance with the bid price requirement set forth in Nasdaq Listing Rule 5550(a)(1). In order to evidence compliance with the bid price
requirement, the Company must evidence a closing bid price of at least $1.00 per share for a minimum of 10, but generally not more than
20, consecutive business days. On November 7, 2025, we held a special meeting of shareholders where our shareholders approved, among other
things, the Reverse Split. The Reverse Split was effected on November 18, 2025.
On December 3, 2025, the Company
received formal notice from Nasdaq that the Company has regained compliance with the Bid Price Rule and evidenced compliance with all
other applicable criteria for continued listing on Nasdaq. Accordingly, the previously disclosed listing matter has been closed.
The Company will remain subject
to a one-year “Panel Monitor”, as contemplated by Nasdaq Listing Rule 5815(d)(4)(A), through December 5, 2026. If during that
period the Company fails to satisfy any of the criteria for continued listing on Nasdaq, the Staff may not grant the Company additional
time to regain compliance. Rather, Nasdaq will issue a delist determination, which the Company may address by requesting a new hearing
before the Nasdaq Hearings Panel.
On February 4, 2026, we received
a written notice Nasdaq indicating that the Staff has determined to delist the Company’s securities from The Nasdaq Capital Market.
6
As disclosed in the Notice,
the Staff determined that the Company’s common stock failed to maintain compliance with the Bid Price Rule. While companies are
typically afforded a 180-calendar-day compliance period to comply with the Bid Price Rule, the Staff concluded that the Company is not
eligible for the compliance period pursuant to Nasdaq Listing Rule 5810(c)(3)(A)(iv) due to the fact that the Company effected a reverse
stock split within the prior one-year period, specifically a 1-for-10 reverse stock split on November 18, 2025, and therefore is subject
to immediate delisting.
As further disclosed in the
Notice, the Company had the right to request a hearing and that a hearing request would result in a stay of any suspension or delisting
action pending the conclusion of the hearings process. Accordingly, on February 11, 2026, the Company requested a hearing before the Panel,
which served to stay any further suspension or delisting action through the hearing or any extension the Panel provides following the
hearing.
At the hearing, the Company
intends to take all reasonable measures available and is going to present a plan to regain compliance with the Bid Price Rule and
remain listed on Nasdaq to the Panel. However, there can be no assurance that the Company will be able to regain compliance with the Bid
Price Rule or maintain compliance with all other Nasdaq continued listing requirements.
In connection with the Company’s
entry into the Common Stock Purchase Agreement with White Lion as described below, if the Company fails to be listed on the Nasdaq Capital
Market, the Commitment Fee Amount (as defined below) will increase subject to the terms of the Delisting Penalty Provision in the Common
Stock Purchase Agreement. See “Item 1-Business-Recent Developments-Equity Line of Credit Agreement” for additional information.
September 2025 Warrant Inducement
On September 2, 2025, we entered
into an inducement agreement (the “Inducement Letter”) with a certain holder (the “Holder”) of certain of the
Company’s existing warrants to purchase an aggregate of 427,020 shares of the Company’s common stock, consisting of (i) 127,119
warrants issued on December 20, 2023 with an expiration date of June 20, 2029 at an exercise price of $11.8 per share (ii) 99,967 warrants
issued on June 6, 2024 with an expiration date of December 6, 2029 at an exercise price of $20.00 per share and (iii) 199,934 warrants
issued on July 2, 2024 with an expiration date of July 2, 2026 at an exercise price of $17.50 per share (the “Existing Warrants”).
Pursuant to the Inducement
Letter, the Holder agreed to exercise for cash the Existing Warrants to purchase an aggregate of 427,020 shares of the Company’s
common stock at a reduced exercise price of $3.70 per share in consideration of the Company’s agreement to issue new common stock
purchase warrants (the “New Warrants”), as descried below, to purchase up to an aggregate of 640,530 shares of the Company’s
common stock (the “New Warrant Shares”) at an exercise price of $3.70 per share. The Company received aggregate gross proceeds
of approximately $1.6 million from the exercise of the Existing Warrants by the Holder, before deducting financial advisory fees and other
offering expenses payable by the Company.
Rodman & Renshaw LLC and
HCW acted as financial advisors to the Company in connection with the transactions contemplated by the Inducement Letter. Pursuant to
an engagement letter with HCW, the Company has agreed to pay the financial advisors a cash fee equal to 7.0% of the aggregate gross proceeds
received from the Holder’s exercise of the Existing Warrants, as well as a management fee equal to 1.0% of the gross proceeds from
the exercise of the Existing Warrants and $25,000 paid for non-accountable expenses. The Company has also agreed to issue to the financial
advisors or their designees warrants (the “Inducement Placement Agent Warrants”) to purchase up to 29,891 shares of common
stock (representing 7.0% of the Existing Warrants being exercised), which will have the same terms as the New Warrants having a term of
five years of Stockholder Approval (as defined below) except the Inducement Placement Agent Warrants will have an exercise price equal
to $4.625 per share (125% of the exercise price of the Existing Warrants).
The New Warrants have an exercise
price equal to $3.70 per share. The New Warrants will be exercisable from the effective date (the “Warrant Stockholder Approval
Date”) of shareholder approval (“Stockholder Approval”), until (i) the five-year anniversary of such date for 340,629
of the New Warrants and (ii) the twenty-four-month anniversary of such date for 299,901 of the New Warrants. The exercise price and number
of New Warrant Shares issuable upon exercise of the New Warrants is subject to appropriate adjustment in the event of stock dividends,
stock splits, subsequent rights offerings, pro rata distributions, reorganizations, or similar events affecting the Company’s common
stock and the exercise price. On November 7, 2025, the Warrant Stockholder Approval was obtained in a special meeting of our shareholder,
resulting in the Warrant Stockholder Approval Date being such date.
7
The closing of the transactions
contemplated pursuant to the Inducement Letter occurred on September 3, 2025.
Provided that the Inducement
Letter prohibited the Company from entering into an agreement to effect any issuance by the Company involving a variable rate transaction,
the Holder agreed to waive such prohibition with respect to the transactions contemplated by the ELOC Purchase Agreement as described
below, and signed an amendment to the Inducement Letter on October 9, 2025. Pursuant to such amendment, the Company issued to the Holder
10,000 warrants to purchase shares of common stock of the Company on similar terms as the Series A-1 Warrants.
Equity Line of Credit Agreement
On September 27, 2025, we
entered into a common stock purchase agreement (the “Common Stock Purchase Agreement”), with an effective date of October
1, 2025, and a related registration rights agreement (the “White Lion RRA”) with White Lion Capital, LLC, a Nevada limited
liability company (“White Lion”). Pursuant to the Common Stock Purchase Agreement, the Company has the right, but not the
obligation to require White Lion to purchase, from time to time, up to $30,000,000 in aggregate gross purchase price (the “Commitment
Amount”) of newly issued shares of the Company’s Common Stock, subject to certain limitations and conditions set forth in
the Common Stock Purchase Agreement.
The Company is obligated under
the Common Stock Purchase Agreement and the White Lion RRA to file a registration statement (the “Resale Registration Statement”)
with the SEC to register the Common Stock under the Securities Act of 1933, as amended (the “Securities Act”), for the resale
by White Lion of shares of Common Stock that the Company may issue to White Lion under the Common Stock Purchase Agreement and to register
the Commitment Shares (as defined below) within five business days of the date of the Common Stock Purchase Agreement.
The maximum number of shares
issuable under the Common Stock Purchase Agreement is subject to the Exchange Cap.
The Company agreed to call
a special meeting of its shareholders (the “Special Meeting”) to obtain shareholder approval for the issuance of Common Stock
under the Common Stock beyond the Exchange Cap (“Shareholder Approval”) within 120 days of October 1, 2025. If the Company
failed to call the Special Meeting within this timeframe, it shall pay liquidated damages to White Lion, as more fully described in the
Common Stock Purchase Agreement. The Special Meeting was held on January 29, 2026. Shareholder Approval was not obtained due to a failure
to reach a quorum. Please see “January 2026 Special Meeting of Shareholders” below for more information.
Because Shareholder Approval
was not obtained at the Special Meeting, the Company is obligated to call an additional Special Meeting every ninety (90) days thereafter,
for a total period of 360 days, until Shareholder Approval is obtained. The follow-up meeting to obtain Shareholder Approval is scheduled
to be held on April 13, 2026.
As consideration for White Lion’s irrevocable commitment to purchase
the Company’s Common Stock up to the Commitment Amount, the Company agreed to issue shares of Common Stock to White Lion (the “Commitment
Shares”) equal to $750,000 (the “Commitment Fee Amount”) divided by the lowest traded price of the Company’s common
stock during the 30 business days prior to the issuance of the Commitment Shares.
If at any point during the
term of the Common Stock Purchase Agreement the Company fails to be listed on the Nasdaq Capital Market, the Commitment Fee Amount will
increase to $1,000,000 if remedied within six months or less, to $1,250,000 if remedied after six months but before twelve months, and
$1,500,000 if not remedied within twelve months (the “Delisting Penalty Provision”). The Delisting Penalty Provision shall
automatically be waived on the date that is six (6) months after the later of (A) the date on which Shareholder Approval is Obtained and
(B) the date on which the Resale Registration Statement has been declared effective by the SEC.
8
Subject to the satisfaction
of certain customary conditions including, without limitation, the effectiveness of a registration statement registering the shares issuable
pursuant to the Common Stock Purchase Agreement, the Company’s right to sell shares to White Lion will commence on October 1, 2025
and extend until October 1, 2028, unless the Company has exercised its right in full to sell shares to White Lion under the Common Stock
Purchase Agreement prior to such date (the period beginning on the effective date and ending on the earlier of such dates, the “Commitment
Period”). During such term, subject to the terms and conditions of the Common Stock Purchase Agreement, the Company shall notify
(such notice, a “Purchase Notice”) White Lion when the Company exercises its right to sell shares (the effective date of such
notice, a “Notice Date”). The Purchase Notice may be a Regular Purchase Notice or a Rapid Purchase Notice, each as described
below.
The number of shares sold
pursuant to any such notice may not exceed 40% of the Average Daily Trading Volume for the common stock traded on Nasdaq immediately preceding
receipt of the applicable Purchase Notice, and can be increased at any time at the sole discretion of White Lion, up to 9.99% of the outstanding
shares of the Company.
Under a Regular Purchase Notice,
the purchase price to be paid by White Lion for any such shares will equal 97.5% multiplied by the lower of the (i) lowest daily VWAP
of the Common Stock during the Regular Purchase Valuation Period (as such term is defined in the Common Stock Purchase Agreement) or (ii)
the closing price of the Common Stock one business day prior to the delivery of the Regular Purchase Notice.
Under a Rapid Purchase Notice,
the purchase price to be paid by White Lion for any such shares will equal (i) the lowest traded price of the Common Stock on the Rapid
Purchase Notice Date with respect to Rapid Purchase Price Option 1; or (ii) 99% multiplied by the lowest traded price of the Common Stock
two hours following written confirmation of the acceptance of the Rapid Purchase Notice by White Lion with respect to Rapid Purchase Price
Option 2.
The Company may terminate
the Common Stock Purchase Agreement at any time, which shall be effected by written notice being sent by the Company to White Lion. In
addition, the Common Stock Purchase Agreement shall automatically terminate on the earlier of (i) the end of the Commitment Period or
(ii) the date that, pursuant to or within the meaning of any bankruptcy law, the Company commences a voluntary case or any person commences
a proceeding against the Company, a custodian is appointed for the Company or for all or substantially all of its property or the Company
makes a general assignment for the benefit of its creditors. Certain provisions of the Common Stock Purchase Agreement survive termination,
as described more fully in the text of the agreement.
Concurrently with the execution
of the Common Stock Purchase Agreement, the Company entered into the White Lion RRA with White Lion in which the Company has agreed to
register the shares of Common Stock purchased by White Lion under the Common Stock Purchase Agreement with the SEC for resale within 30
days of the execution date of the White Lion RRA. The White Lion RRA also contains usual and customary damages provisions for failure
to have the registration statement declared effective by the SEC within the time periods specified therein.
The Common Stock Purchase
Agreement and the White Lion RRA contain customary representations, warranties, conditions and indemnification obligations of the parties.
The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific
dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting
parties.
White Lion Private Placement
Concurrently on September
27, 2025, the Company entered into a securities purchase agreement (the “PIPE Purchase Agreement”) with White Lion, pursuant
to which the Company agreed to issue and sell to White Lion in a private placement (the “Offering”) (i) 87,177 shares (the
“Shares”) of Common Stock, and (ii) pre-funded warrants to purchase up to 312,823 shares of Common Stock (the “White
Lion Pre-Funded Warrants”) for a purchase price of $2.125 per share of Common Stock and $2.124 per White Lion Pre-Funded Warrant,
for a total aggregate gross proceeds of approximately $850,000. The Offering closed on September 29, 2025.
9
The Company had a right to
redeem 48,826 of the shares of Common Stock at a redemption price of $0.001 per share. The Company and White Lion have agreed that, in
lieu of such redemption, on October 20, 2025, the Company reduced the number shares issuable pursuant upon exercise of the White Lion
Pre-Funded Warrants by 48,826 shares, to 263,997.
The White Lion Pre-Funded
Warrants are immediately exercisable at an exercise price of $0. 001 per share of Common Stock and will not expire until exercised in
full. However, the Company may not issue a number of shares of Common Stock pursuant to exercise of the White Lion Pre-Funded Warrants
in an amount that will not exceed the Exchange Cap when combined with the number of Shares issued in the Offering, before shareholder
approval for further issuance beyond the Exchange Cap is obtained. The Company intends to obtain such shareholder approval concurrently
with the Shareholder Approval required for the issuance of shares of Common Stock under the Common Stock Purchase Agreement beyond the
Exchange Cap.
The obligation to file the
Resale Registration Statement described above also covers the registration of the shares of Common Stock and shares underlying the White
Lion Pre-Funded Warrants issued pursuant to the PIPE Purchase Agreement. The Company filed the Resale Registration Statement on October
7, 2025, and such registration statement became effective on November 28, 2025.
December 2025 Offering
On December 17, 2025, we offered
and sold in a public offering on a best efforts basis (the “December 2025 Offering”) (i) 4,352,500 shares of the Company’s
Common Stock, (ii) 1,897,500 pre-funded warrants to purchase up to 1,897,500 shares of Common Stock (the “December 2025 Pre-Funded
Warrants”), and (iii) 6,250,000 common warrants to purchase up to 6,250,000 shares of Common Stock, (the “December 2025 Common
Warrants” and together with the Pre-Funded Warrants, the “December 2025 Warrants”), at a purchase price of $0.80 per
share of Common Stock and accompanying December 2025 Common Warrant, and $0.7999 per December 2025 Pre-Funded Warrant and accompanying
December 2025 Common Warrant. Aggregate gross proceeds from the December 2025 Offering (without taking into account any proceeds from
any future exercises of December 2025 Warrants) were approximately $5 million. The Offering closed on December 19, 2025.
The December 2025 Pre-Funded