Other Short-Term Loan

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Other Short-Term Loan

Note 6 – Other Short-Term Loan

On January 24, 2024, the Company entered into an agreement for the purchase and sale of future receipts (the “Future Receipts Agreement”) with an unrelated commercial lender (the “Buyer”) pursuant to which the Buyer purchased $1,512,000 (“Purchased Amount”) in future receipts of the Company at the discount price of $1,050,000, for net proceeds of $1,000,000 cash, net of $50,000 origination fee. At issuance, the Company recorded a debt discount of $512,000 which will be amortized over the life of the loan into interest expense. The Company is required to repay the Purchased Amount with weekly installments in the amount of $54,000 until the Purchased Amount has been satisfied. The Company may prepay the Purchased Amount within 30 calendar days by tendering the amount of $1,312,500.

In the event the Company is unable to make timely weekly payments due to a business slow down, or if the full Purchased Amount is never remitted due to bankruptcy or other cessation of operations in the ordinary course of business, and the Company has not breached the Future Receipts Agreement, it would not be an event of default. The Company would not owe anything to Buyer and would not be in breach of or default under this Future Receipts Agreement.

During the three months ended March 31, 2024, the Company recorded $164,572 of amortization related to the debt discount as interest expense. As of March 31, 2024, the total balance outstanding under the short-term loan is $1,026,000 and the unamortized debt discount is $347,428.

	Purchased Amount		Payments			Unamortized Debt Discount			Balance, Net of Discount
Current portion of other short-term loan liability	$	1,512,000	$	(486,000	)	$	(347,428	)	$	678,572
Total	$	1,512,000	$	(486,000	)	$	(347,428	)	$	678,572

AGEAGLE AERIAL SYSTEMS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(UNAUDITED)