Mobilicom Ltd 20-F for FY2025
Mobilicom Ltd (MOB)
About this 20-F
Mobilicom Ltd filed this 20-F on March 23, 2026, covering the fiscal year ended December 31, 2025 (FY2025).
Headline figures
Fiscal year ended December 31, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $3.36M
- up 5.8% from $3.18M a year earlier
- Net loss
- $23.72M
- compared with a net loss of $8.01M a year earlier
- Diluted EPS
- -$2.68
- compared with -$1.32 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
OR
For the fiscal year ended
OR
OR
Date of event requiring this shell company report _____________________
For the transition period from ______ to ______
Commission File No.:
(Exact name of registrant as specified in its charter)
Translation of registrant’s name into English: Not applicable
| +972-77-7103060 | ||
| (Jurisdiction of incorporation or organization) | (Address of principal executive offices) |
Director of Finance
Tel: +
Email:
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
| Title of each class to be registered | Trading Symbol(s) | Name of each exchange on which each class is to be registered | ||
Securities registered or to be registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Number of outstanding shares of each of the issuer’s
classes of capital or common stock as of December 31, 2025:
Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
If this report is an annual or transition report,
indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act of 1934.
Yes ☐
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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.
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 during the preceding
12 months.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company.
| Large accelerated filer ☐ | Accelerated filer ☐ | |||
| Emerging Growth Company |
If an emerging growth company that prepares its
financial statements in accordance with U.S. GAAP, 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.
†The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
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 which basis of accounting the registrant has used to prepare the financial statements included in this filing.
| U.S. GAAP ☐ | Other ☐ |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. ☐ Item 17 ☐ Item 18
If this is an annual report, indicate by check
mark whether the registrant is a shell company. Yes ☐ No
TABLE OF CONTENTS
i
ii
INTRODUCTION
Unless otherwise indicated or the context implies otherwise references in this Annual Report on Form 20-F to “we,” “us,” “our” or “Mobilicom” refers to Mobilicom Limited, an Australian corporation, and to Mobilicom Ltd., our Israeli subsidiary. All references to “shares” or “ordinary shares” refer to our ordinary shares.
On December 8, 2025, we effected a reverse share split of our issued and outstanding ordinary shares at a ratio of 1-for-275, or the Reverse Split. Concurrently with the Reverse Split, we effected a corresponding change in the ratio of ordinary shares represented by each of our American Depositary Shares, or ADSs, such that the ratio changed from one ADS representing 275 ordinary shares to one ADS representing one ordinary share. Concurrently, our ADSs were mandatorily cancelled and exchanged for ordinary shares on a one-for-one basis, or the Mandatory Exchange, and our ordinary shares, which had been approved for listing and trading on the Nasdaq Capital Market, commenced trading at the market open on December 8, 2025. All references in this annual report to our share capital, including the number of ordinary shares outstanding and per-share data for periods prior to the effective date of the Reverse Split and the Mandatory Exchange, have been retroactively adjusted to give effect to the Reverse Split and the Mandatory Exchange.
On January 1, 2024, the Company transitioned from the Australian dollar (“AUD”) as its presentation currency to the U.S. dollar (‘USD”) as its presentation currency. The change was accounted for as a change of accounting policy on a retrospective basis. In addition, after re-evaluating indicators established in IAS 21 to determine the functional currency of the Company and considering related operative facts, commencing January 1, 2024, the Company transitioned from AUD as its functional currency to USD as its functional currency. The functional currency of the Company’s subsidiary, Mobilicom Ltd. remains New Israeli Shekel. All references to “$” (other than in our audited and unaudited consolidated financial statements) or “US$” in this Annual Report on Form 20-F refer to U.S. dollars. All references to “AUD$” or “AUD” in this Annual Report on Form 20-F mean Australian dollars. All references to “NIS” in this Annual Report on Form 20-F mean New Israeli Shekel.
Our fiscal year end is December 31. References to a particular “fiscal year” are to our fiscal year ended December 31 of that calendar year.
Unless otherwise indicated, the consolidated financial statements and related notes included in this Annual Report on Form 20-F have been prepared in accordance with International Accounting Standards (IAS) and also comply with International Financial Reporting Standards, or IFRS, and interpretations issued by the International Accounting Standards Board, or IASB, which differ in certain significant respects from Generally Accepted Accounting Principles in the United States, or GAAP.
Certain figures included in this Annual Report on Form 20-F have been subject to rounding adjustments. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.
iii
EMERGING GROWTH COMPANY STATUS
We qualify as an “emerging growth company,” as defined in the U.S. Jumpstart Our Business Startups Act of 2012, or JOBS Act, and we may take advantage of certain exemptions, including exemptions from various reporting requirements that are otherwise applicable to public traded entities that do not qualify as emerging growth companies. These exemptions include:
| ● | not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act; and |
| ● | not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis). |
We will remain an emerging growth company until the earliest of: (i) the last day of the first fiscal year in which our annual gross revenues exceed $1.235 billion; (ii) the last day of the fiscal year following the fifth anniversary of the date of our initial public offering (i.e., December 31, 2027); (iii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the aggregate worldwide market value of our ordinary shares, including ordinary shares represented by warrants, held by non-affiliates is at least $700 million as of the last business day of our most recently completed second fiscal quarter; or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during any three-year period.
TRADEMARKS
MOBILICOM and our other registered or common law trademarks, trade names or service marks appearing in this Annual Report on Form 20-F are owned by us. Solely for convenience, trademarks and trade names referred to in this Annual Report on Form 20-F appear without the “®” or “™” symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Each trademark, trade name or service mark of any other company appearing in this Annual Report on Form 20-F is the property of its respective holder.
iv
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain information included or incorporated by reference in this Annual Report on Form 20-F may be deemed to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Forward-looking statements are often characterized by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “estimate,” “continue,” “believe,” “should,” “intend,” “project” or other similar words, but are not the only way these statements are identified.
These forward-looking statements may include, but are not limited to, statements relating to our objectives, plans and strategies, statements that contain projections of results of operations or of financial condition, expected capital needs and expenses, statements relating to the research, development, completion and use of our products, and all statements (other than statements of historical facts) that address activities, events or developments that we intend, expect, project, believe or anticipate will or may occur in the future.
Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. We have based these forward-looking statements on assumptions and assessments made by our management in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate.
Important factors that could cause actual results, developments and business decisions to differ materially from those anticipated in these forward-looking statements include, among other things:
| ● | our ability to implement our growth strategies; | |
| ● | our competitive advantages; | |
| ● | the development of new products and services; | |
| ● | our ability to obtain and maintain financing on acceptable terms; | |
| ● | the impact of competition; | |
| ● | changes in laws, rules and regulations; | |
| ● | our ability to maintain our software licenses and product certifications; | |
| ● | general market, political, and economic conditions in the countries in which we operate; |
| ● | our ability to maintain good business relationships with our customers, suppliers and other strategic partners; | |
| ● | our ability to protect intellectual property; | |
| ● | our ability to retain key personnel; | |
| ● | the absence of material adverse changes in the industry or global economy; | |
| ● |
security, political and economic instability in the Middle East that could harm our business, including due to the current war security situation in Israel; and | |
| ● | those factors referred to in “Item 3.D. Risk Factors,” “Item 4. Information on the Company,” and “Item 5. Operating and Financial Review and Prospects”, as well as in this annual report on Form 20-F generally. |
v
Readers are urged to carefully review and consider the various disclosures made throughout this Annual Report on Form 20-F which are designed to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects.
You should not put undue reliance on any forward-looking statements. Any forward-looking statements in this annual report on Form 20-F are made as of the date hereof and are expressly qualified in their entirety by the cautionary statements included in this Annual Report. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
In addition, the section of this Annual Report on Form 20-F entitled “Item 4. Information on the Company” contains information obtained from independent industry sources and other sources that we have not independently verified.
INDUSTRY AND OTHER DATA
This Annual Report on Form 20-F includes statistical, market and industry data and forecasts which we obtained from publicly available information and independent industry publications and reports that we believe to be reliable sources. These publicly available industry publications and reports generally state that they obtain their information from sources that they believe to be reliable, but they do not guarantee the accuracy or completeness of the information. Although we are responsible for all of the disclosures contained in this Annual Report on Form 20-F, including such statistical, market and industry data, we have not independently verified any of the data from third-party sources, nor have we ascertained the underlying economic assumptions relied upon therein. In addition, while we believe the market opportunity information included in this Annual Report on Form 20-F is generally reliable and is based on reasonable assumptions, such data involves risks and uncertainties, including those discussed under the heading “Risk Factors.”
vi
PART I
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
Not applicable.
ITEM 3. KEY INFORMATION
A. [Reserved]
B. Capitalization and Indebtedness
Not applicable.
C. Reasons for the Offer and Use of Proceeds
Not applicable.
D. Risk Factors
You should carefully consider the risks described below, together with all of the other information in this Annual Report on Form 20-F. The risks and uncertainties described below are those significant risk factors, currently known and specific to us, that we believe are relevant to an investment in our securities. Additional risks and uncertainties not currently known to us or that we now deem immaterial may also harm us. If any of these risks materialize our business, results of operations or financial condition could suffer, and the price of our ordinary shares could decline substantially.
Summary Risk Factors
Investing in our securities entails a high degree of risk as more fully described herein. You should carefully consider the risks described under the “Risk Factors” section beginning on page 1. Some of these risks include but are not limited to:
Risks Related to Our Financial Condition
| ● | We have a history of losses. |
| ● | We expect that we will need to invest significant time and raise substantial additional capital before we can expect to become profitable from sales of our products. This additional capital may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate our product development efforts or other operations. |
| ● | Shortfalls in available external research and development funding could adversely affect us. | |
| ● | We may not accurately forecast revenues, profitability and appropriately plan our expenses. | |
| ● | Exchange rate fluctuations between multiple foreign currencies may negatively affect our earnings, operating cash flow. | |
| ● | We have commenced marketing activities for our cloud-based software and cybersecurity solutions, which may be marketed and sold to customers using different sales models, including annual or monthly license or software as a service, any of which may not be profitable to us. |
1
Risks Related to Our Business and Industry
| ● | We expect to incur substantial research and development costs and devote significant resources to identifying and commercializing new products and services, which could significantly reduce our profitability and may never result in revenue to us. |
| ● | We will be affected by operational risks and may not be adequately insured for certain risks. |
| ● | We operate in evolving markets, which makes it difficult to evaluate our business and future prospects. |
| ● | We operate in a competitive market. |
| ● | The markets in which we compete are characterized by rapid technological change, which requires us to develop new products and product enhancements, and could render our existing products and technologies obsolete. |
| ● | Failure to obtain necessary regulatory approvals may prevent us from selling our hardware products. |
| ● | We may be prohibited from shipping our products to certain countries if we are unable to obtain certain governmental authorizations. | |
| ● | We may be subject to the risks associated with future acquisitions or strategic partnerships, which may increase our capital requirements, dilute our shareholders, cause us to incur debt or assume contingent liabilities, and subject us to other risks. |
| ● | Our inability to assure retention of management and key employees could impair our future success. |
| ● | A significant growth in the number of personnel would place a strain upon our management and resources. |
| ● | We are subject to the risks associated with foreign operations in other countries. |
| ● | If critical components or raw materials used to manufacture our products become scarce or unavailable, then we may incur delays in manufacturing and delivery of our products, which could damage our business. |
| ● | Our products may be subject to recall or return. |
| ● | If we release defective products or services, our operating results could suffer. |
| ● | Our products and services are complex and could have unknown defects or errors, which may give rise to legal claims against us, diminish our brand or divert our resources from other purposes. |
| ● | We are a supplier for government programs, which subjects us to risks including early termination, audits, investigations, sanctions penalties and delayed sales. |
| ● | Negative customer perception regarding our products could have a material adverse effect on the demand for our products and the business, results of operations, financial condition and cash flows. |
| ● | If we fail to successfully promote our product and brand, it could have a material adverse effect on our business, prospects, financial condition and results of operations. |
2
| ● | We may be subject to cybersecurity attacks or electronic communication security risks. |
| ● | Failure to adhere to our financial reporting obligations and other public company requirements could adversely affect the market price of our ordinary shares. |
| ● | We may experience adverse effects on our reported results of operations as a result of adopting new accounting standards or interpretations. |
| ● | We are subject to certain Israeli, U.S. and foreign anticorruption, anti-money laundering, export control, sanctions and other trade laws and regulations. We can face serious consequences for violations. |
Risks Related to our Intellectual Property
| ● | If we fail to protect, or incur significant costs in defending, our intellectual property and other know-how or proprietary rights, our business, financial condition, and results of operations could be materially harmed. |
| ● | Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements. |
| ● | We may be sued by third parties for alleged infringement of their proprietary rights, which could be costly, time-consuming and limit our ability to use certain technologies in the future. |
| ● | We may not be able to protect our intellectual property rights throughout the world. |
Risks Related to Israeli Law and our Operations in Israel
| ● | Political, economic and military instability in Israel may impede our ability to operate and harm our financial results. |
| ● | Our operations may be disrupted by the obligations of personnel to perform military service. |
| ● | We may become subject to claims for remuneration or royalties for assigned service invention rights by our employees, which could result in litigation and adversely affect our business. |
| ● | We received Israeli government grants, from the Israeli Innovation Authorization, or IIA, for certain of our research and development activities, the terms of which may require us to pay royalties and to satisfy specified conditions in order to manufacture products and transfer technologies outside of Israel. If we fail to satisfy these conditions, we may be required to pay penalties and refund some grants previously received. |
| ● | We may be subject to the risks associated with the Israeli Law for the Encouragement of Industrial Research and Development 5744-1984, or R&D Law. |
Risks Related to our Ordinary Shares
| ● | The market price and trading volume of our ordinary shares may be volatile and may be affected by economic conditions beyond our control. |
| ● | A shareholder’s holding may be diluted if we issue additional shares or other securities in the future. |
3
| ● | As a foreign private issuer, we are permitted and we expect to follow certain home country corporate governance practices in lieu of certain Nasdaq requirements applicable to domestic issuers. This may afford less protection for our shareholders. |
| ● | As a foreign private issuer, we are permitted to file less information with the SEC than a company incorporated in the United States. Accordingly, there may be less publicly available information concerning us than there is for companies incorporated in the United States. |
| ● | We are an emerging growth company as defined in the JOBS Act and the reduced disclosure requirements applicable to emerging growth companies may make our ordinary shares less attractive to investors and, as a result, adversely affect the price of our ordinary shares and result in a less active trading market for our ordinary shares. |
| ● | If we fail to establish and maintain proper internal financial reporting controls, our ability to produce accurate consolidated financial statements or comply with applicable regulations could be impaired. |
| ● | If we are classified as a “passive foreign investment company,” then our U.S. shareholders could suffer adverse tax consequences as a result. | |
| ● | Our Constitution and Australian laws and regulations applicable to us may adversely affect our ability to take actions that could be beneficial to our shareholders. |
| ● |
You will have limited ability to bring an action against us or against our directors and officers, or to enforce a judgment against us or them, because we are incorporated in Australia and certain of our directors and officers reside outside the United States.
| |
| ● | Australian companies may not be able to initiate shareholder derivative actions, thereby depriving shareholders of the ability to protect their interests. |
These and other risks described in this Annual Report on Form 20-F could materially and adversely impact our business, financial condition, operating results and cash flow, which could cause the trading price of our ordinary shares to decline and could result in a loss of your investment.
Risks Related to Our Financial Condition and Capital Requirements
We have a history of losses.
We have incurred net losses since our inception on February 2, 2017. Our net losses were $23,724,950 and $8,010,358 for the fiscal years ended December 31, 2025 and 2024 respectively. We cannot assure that we can become profitable or avoid net losses in the future or that there will be any earnings or revenues in any future quarterly or other periods. We expect that our operating expenses will increase as we grow our business, including expending substantial resources for research, development, sales and marketing. As a result, any decrease or delay in generating revenues could result in material operating losses.
We expect that we will need to invest significant time and raise substantial additional capital before we can expect to become profitable from sales of our products. This additional capital may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate our product development efforts or other operations.
We expect that we will need to invest significant time and require substantial additional capital to commercialize our products. In addition, our operating plans may change as a result of many factors that may currently be unknown to us, and we may need to seek additional funds sooner than planned. Our future capital requirements will depend on many factors, including but not limited to production and manufacturing costs (which are dependent on the costs of mechanical and electronic components of our products), research and development activities, sales activities including compensation for salespersons, development of additional software and hardware products for our current smart solution offerings, and marketing costs related to expansion into the government and commercial drone and robotics markets in the United States and Europe.
4
Shortfalls in available external research and development funding could adversely affect us.
We depend on our research and development activities to develop the core technologies used in our cybersecurity and smart solutions and for the research and development of our future products. A portion of our research and development activities depends on funding from the IIA; in the future, we may seek additional funding from the IIA and other governmental organizations. These government organizations’ spending levels can be impacted by a number of variables, including general economic conditions, specific companies’ financial performance and competition for Israeli government funding with other Israeli government-sponsored programs in the budget formulation and appropriation processes. Any reductions in available research and development funding could harm our business, financial condition and operating results.
We may not accurately forecast revenues, profitability and appropriately plan our expenses.
We base our current and future expense levels on our operating forecasts and estimates of future income and operating results. Income and operating results are difficult to forecast because they generally depend on the volume sales and timing, which are uncertain. Additionally, our business is affected by general economic and business conditions around the world. A softening in income, whether caused by changes in customer preferences in the drones and robotics platform markets, or a weakening in global economies, may result in decreased net revenue levels, and we may be unable to adjust our expenses in a timely manner to compensate for any unexpected shortfall in income. This inability could cause our (loss)/income after tax in a given quarter to be (higher)/lower than expected. We also make certain assumptions when forecasting the amount of expense we expect related to our share-based payments, which includes the expected volatility of our share price, and the expected life of share options granted. These assumptions are partly based on historical results. If actual results differ from our estimates, our operating results in a given period may be lower than expected.
Exchange rate fluctuations between multiple foreign currencies may negatively affect our earnings, operating cash flow.
Our reporting and functional currency is US$. Our Israeli subsidiary’s functional currency is the NIS. Our key expenses and revenues are currently primarily payable in NIS and US$. Certain amounts of our revenues and expenses are also in AUD and Euros. In addition, our recent equity raises were received in US$, and our research and development support program and grants are received in NIS.
As a result, we are exposed to the currency fluctuation risks relating to the recording of our expenses and revenues in different currencies, and potential cash flow shortage. We may, in the future, decide to enter into currency hedging transactions. These measures, however, may not adequately protect us from material adverse effects.
We have commenced marketing activities for our cloud-based software and cybersecurity solutions, which may be marketed and sold to customers using different sales models, including annual or monthly license or software as a service, any of which may not be profitable to us.
Historically, our revenues have been derived from the sales of our hardware products. As our cloud-based software and cybersecurity solutions are newly released and only at marketing phase and toward initial sales phase, we have not definitely determined the sales model for how we plan to market and sell these products. Forecasting our revenues and profitability for these product offerings is inherently uncertain and volatile. Our actual revenues and profits for these new products may be significantly less than our forecasts. Additionally, the new business models could fail for one or more of our products and/or services, resulting in the loss our investment in the development and infrastructure needed to support the new business models, and the opportunity cost of diverting management and financial resources away from more successful businesses.
5
Risks Related to Our Business and Industry
We expect to incur substantial research and development costs and devote significant resources to identifying and commercializing new products and services, which could significantly reduce its profitability and may never result in revenue to us.
Our future growth depends on penetrating new markets, expansion in current markets, adapting existing products to new applications, and introducing new products and services that achieve market acceptance. We plan to incur substantial research and development costs as part of our efforts to design, develop and commercialize new products for cybersecurity and cloud-based software and enhance our existing products and technology. Because we account for research and development costs as operating expenses, these expenditures will adversely affect our earnings in the future. Further, our research and development programs may not produce successful results, and our new products and services may not achieve market acceptance, create any additional revenue or become profitable, which could materially harm our business, prospects, financial results and liquidity.
We will be affected by operational risks and may not be adequately insured for certain risks.
We will be affected by a number of operational risks and we may not be adequately insured for certain risks, including: product liability litigation, as we do not have product liability insurance; labor disputes; further workforce reductions; catastrophic accidents; fires; blockades or other acts of social activism; changes in the regulatory environment; impact of non-compliance with laws and regulations; cyber-attacks and ransom requests; natural phenomena, such as inclement weather conditions, floods, earthquakes and ground movements. There is no assurance that the foregoing risks and hazards will not result in damage to, or destruction of, our technologies, personal injury or death, environmental damage, adverse impacts on our operation, costs, monetary losses, potential legal liability and adverse governmental action, any of which could have an adverse impact on our future cash flows, earnings and financial condition. Also, we may be subject to or affected by liability or sustain loss for certain risks and hazards against which we cannot insure or which we may elect not to insure because of the cost. This lack of insurance coverage could have an adverse impact on our future cash flows, earnings, results of operations and financial condition.
We operate in evolving markets, which makes it difficult to evaluate our business and future prospects.
Our cybersecurity, smart solutions and services are sold in rapidly evolving markets. The commercial drones and robotics market is in early stages of customer adoption. Accordingly, our business and future prospects may be difficult to evaluate. We cannot accurately predict the extent to which demand for our products and services will increase, if at all. The challenges, risks and uncertainties frequently encountered by companies in rapidly evolving markets could impact our ability to do the following:
| ● | generate sufficient revenue to reach and maintain profitability; |
| ● | acquire and maintain market share; |
| ● | achieve or manage growth in operations; |
| ● | develop and renew contracts; |
| ● | attract and retain research and engineering personal and other highly-qualified personnel; |
| ● | successfully develop and commercially market new products and services; |
| ● | adapt to new or changing policies and spending priorities of governments and commercial enterprises; and |
| ● | access additional capital when required and on reasonable terms. |
If we fail to address these and other challenges, risks and uncertainties successfully, our business, results of operations and financial condition would be materially harmed.
6
We operate in a competitive market.
We face competition from companies such as Silvus, DTC, Microhard, Creao, UXV Technologies, Doodle Labs and others and new competitors will continue to emerge throughout the world. Services offered by our competitors may take a larger share of our customers’ spending than anticipated, which could cause revenue generated from our products to fall below expectations. It is expected that competition in these markets will intensify.
If our competitors develop and market more successful products or offer competitive products at lower price points, or if we do not produce consistently high-quality and well-received products our revenues, margins, and profitability will decline.
Our ability to compete effectively will depend on, among other things, our pricing of products and equipment, quality of customer service, development of new and enhanced products and services in response to customer demands and changing technology, reach and quality of sales and any potential resale or distribution channels, and capital resources. Competition could lead to a reduction in the rate at which we add new customers, a decrease in the size of our market share and a decline in our customers. Examples include but are not limited to competition from other companies in our industry as well as providers of hardware and software technology components to the industry.
The markets in which we compete are characterized by rapid technological change, which requires us to develop new products and product enhancements, and could render our existing products and technologies obsolete.
Continuing technological changes in the market for our products could make our products less competitive or obsolete, either generally or for particular applications. Our future success will depend upon our ability to develop and introduce a variety of new technologies, innovations, capabilities and enhancements to our existing product and service offerings, as well as introduce a variety of new product offerings, to address the changing needs of the markets in which we offer products. Delays in introducing new products, technologies and enhancements, the failure to choose correctly among technical alternatives or the failure to offer innovative products or enhancements at competitive prices may cause existing and potential customers to purchase our competitors’ products.
If we are unable to devote adequate resources to develop new products or cannot otherwise successfully develop new products or enhancements that meet customer requirements on a timely basis, our products could lose market share, our revenue and profits could decline, and we could experience operating losses.
Failure to obtain necessary regulatory approvals from the United States Federal Communication Commission, or FCC, the European Telecommunications Standards Institute, or ETSI, Japan’s Telecom Engineering Center, or Telec, or other governmental agencies or the inability to obtain CE certification from the European Commission or certifications from various environmental organizations, electronics laboratories, software inspections organization, or aviation or vehicles and robotics authorities may prevent us from selling our hardware products.
The FCC, ETSI, Telec and other regulatory organization worldwide are responsible for establishing, managing, and developing safety and operation standards and regulations for electronics equipment usage in commercial and government market segments.
Failure to obtain necessary regulatory approvals from the FCC, ETSI and other regulatory organization worldwide may prevent us from marketing, demonstrating and selling our products in North America, Europe and other global markets which could have an adverse impact on our business, prospects, results of operations and financial condition.
Aviation, vehicular, government and militaries organizations and enterprises set certification standards and requirements for the use of products within their systems or organizations. Some of these requirements are based on internal testing and certification processes and other may requires formal verification and testing laboratories to ensure that products meet those requirements. Failure to pass such testing procedures or obtain necessary laboratories certificates or approval may prevent our products from being chosen, integrated, and sold to or used by government and enterprises customers, which could have an adverse impact on our business, prospects, results of operations and financial condition.
7
We may be prohibited from shipping our products to certain countries if we are unable to obtain Israeli or U.S. government authorization regarding the export of our products, or if current or future export laws limit or otherwise restrict our business.
We may be prohibited from shipping our products to certain countries if we are unable to obtain certain governmental authorizations required to comply with Israeli laws regulating the export of our products from Israel and U.S. federal regulation regulating the export of our products from the United States or Israel. The export regulations and the governing policies applicable to our business are subject to change. In some cases, explicit authorization from the U.S. or Israeli government may be needed to export our products. We have received International Traffic in Arms Regulations, or ITAR, and Civilian Jurisdictions, or CJ, certifications to allow exports from the United States, and, when exporting to certain countries from Israel, the Defense Export Controls Association, or DECA, regulations may apply, even though to date the DECA has determined that these regulations do not apply to our currently sold products. We cannot provide assurance that such export authorizations will be available in the future for our existing and newly developed products. Compliance with these laws has not significantly limited our operations or sales in the recent past, but could significantly limit them in the future. If and when our operations expand into other markets, we may have to comply with other governments’ regulations regarding the export of our products. Non-compliance with applicable export regulations could potentially expose us to fines, penalties and sanctions. If we cannot obtain required government approvals under applicable regulations, we may not be able to sell our products in certain international jurisdictions, which could adversely affect our financial condition and results of operations.
We may be subject to the risks associated with future acquisitions or strategic partnerships, which may increase our capital requirements, dilute our shareholders, cause us to incur debt or assume contingent liabilities, and subject us to other risks.
As part of our overall business strategy, we may in the future pursue select strategic acquisitions or strategic partnership that would provide additional product or service offerings, additional industry expertise, and a stronger industry presence in both existing and new jurisdictions. As of the date of this Annual Report on Form 20-F we have no such agreement or understanding. Any such future acquisitions or strategic partnership, if completed, may expose us to additional potential risks, including risks associated with:
| ● | increased operating expenses and cash requirements; |
| ● | the assumption of additional indebtedness or contingent liabilities; |
| ● | the issuance of our equity securities; |
| ● | assimilation of operations, intellectual property and products of an acquired company, including difficulties associated with integrating new personnel; |
| ● | the diversion of our management’s attention from our existing product programs and initiatives in pursuing such a strategic merger or acquisition; |
| ● | retention of key employees, the loss of key personnel and uncertainties in our ability to maintain key business relationships; |
| ● | risks and uncertainties associated with the other party to such a transaction, including the prospects of that party and their existing products; and |
| ● | our inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the acquisition or even to offset the associated acquisition and maintenance costs. |
8
Our inability to assure retention of management and key employees could impair our future success.
Our future success depends substantially on the continued services of our executive officers and our key development, business and operation personnel. If one or more of our executive officers or key development personnel were unable or unwilling to continue in their present positions, we might not be able to replace them easily or at all. In addition, if any of our executive officers or key employees joins a competitor or forms a competing company, we may lose experience, know-how, key professionals and staff members as well as business partners. These executive officers and key employees could develop drone and robotics cybersecurity and smart solutions technology components and services that could compete with and take customers and market share away from us.
A significant growth in the number of personnel would place a strain upon our management and resources.
We may experience a period of significant growth in the number of personnel that could place a strain upon our management systems and resources. Our future will depend in part on the ability of our officers and other key employees to implement and improve financial and management controls, reporting systems and procedures on a timely basis and to expand, train, motivate and manage our workforce. Our current and planned personnel, systems, procedures and controls may be inadequate to support our future operations.
We face uncertainty and adverse changes in the economy.
Adverse changes in the economy could negatively impact our business. Future economic distress may result in a decrease in demand for our products, which could have a material adverse impact on our operating results and financial condition. Uncertainty and adverse changes in the economy could also increase costs associated with developing and producing products, increase the cost and decrease the availability of sources of financing, and increase our exposure to material losses from bad debts, any of which could have a material adverse impact on our financial condition and operating results.
We are subject to the risks associated with foreign operations in other countries.
Our primary revenues are expected to be achieved in US, Europe and Israel. However, we may expand to additional markets and become subject to risks normally associated with conducting business and manufacturing in other countries. As a result of such expansion, we may be subject to the legal, political, social and regulatory requirements and economic conditions of foreign jurisdictions. We cannot predict government positions on such matters as foreign investment, intellectual property rights or taxation. A change in government positions on these issues could adversely affect our business.
If we expand our business and production to foreign markets, we will need to respond to rapid changes in market conditions, including differing legal, regulatory, economic, social and political conditions in these countries. If we are not able to develop and implement policies and strategies that are effective in each location in which we do business, then our business, prospects, results of operations and financial condition could be materially and adversely affected.
There are tax risks we may be subject to in carrying on business in the United States, Israel and Australia.
We are incorporated in Australia, with a fully owned subsidiaries in Israel and the United States. Since we are operating in a new and developing industry there is a risk that foreign governments may look to increase their tax revenues or levy additional taxes to level the playing field for perceived disadvantages to traditional brick and mortar businesses. There is no guarantee that governments will not impose such additional adverse taxes in the future.
If critical components or raw materials used to manufacture our products become scarce or unavailable, then we may incur delays in manufacturing and delivery of our products, which could damage our business.
We obtain materials, mechanical parts, hardware and electronics components, various subsystems and manufacturing and assembly services from a limited group of suppliers and sub-contractors. We do not have long-term agreements with any of these suppliers or sub-contractors that obligate them to continue to sell materials, components, subsystems, or provide manufacturing services to us. Our reliance on these suppliers or sub-contractors involves significant risks and uncertainties, including whether our suppliers or sub-contractors will provide an adequate supply of required components, subsystems, or services of sufficient quality, will increase prices for the components, subsystems or services and will perform their obligations on a timely basis.
9
In addition, certain raw materials and components used in the manufacture of our products are periodically subject to supply shortages, and our business is subject to the risk of price increases and periodic delays in delivery. For example, between 2020 and 2022, the electronics components shortage crisis, a unique result of the COVID-19 pandemic, negatively affected our market segment by increased delivery lead time and increased purchase prices of components used under certain of our products, which resulted in delay in delivery time of our products to our customers, and had negative effect on our revenues and profitability. Similar global health crises could have a negative effect on our business, operations and future financial performance. Similarly, the market for electronic components is subject to cyclical reductions in supply. If we are unable to obtain components from third-party suppliers in the quantities and of the quality that we require, on a timely basis and at acceptable prices, then we may not be able to deliver our products on a timely or cost-effective basis to our customers, which could cause customers to terminate their contracts with us, increase our costs and seriously harm our business, results of operations and financial condition. Moreover, if any of our suppliers or sub-contractors become financially unstable, then we may have to find new suppliers or sub-contractors. It may take several months to locate alternative suppliers or sub-contractors, if required, or to redesign our products to accommodate components from different suppliers. We may experience significant delays in manufacturing and shipping our products to customers and incur additional development, manufacturing and other costs to establish alternative sources of supply if we lose any of these sources or are required to redesign our products. We cannot predict if we will be able to obtain replacement components within the time frames that we require at an affordable cost, if at all.
Our products may be subject to recall or return.
Manufacturers and distributors of products are sometimes subject to the recall or return of their products for a variety of reasons, including product defects, safety concerns, packaging issues and inadequate or inaccurate labeling disclosure. If any of our products were to be recalled due to an alleged product defect, safety concern or for any other reason, we could be required to incur unexpected expenses of the recall and any legal proceedings that might arise in connection with the recall. We may lose a significant amount of sales and may not be able to replace those sales at an acceptable margin or at all. In addition, a product recall may require significant management time and attention. Additionally, product recalls may lead to increased scrutiny of our products by our customers and regulators, requiring further management time and attention and potential legal fees, costs and other expenses.
If we release defective products or services, our operating results could suffer.
Products designed and released by us involve extremely complex software programs, hardware testing and verification, assembly processes, and quality and functionality inspection and are difficult to develop and manufacture. While we have quality controls in place to detect and prevent defects in our products and services before they are released, these quality controls are subject to human error, overriding, and reasonable resource constraints. Therefore, these quality controls and preventative measures may not be effective in detecting and preventing defects in our products before they have been released into the marketplace. In such an event, we could be required, or decide voluntarily, to suspend the availability of the product or services, which could significantly harm our business and operating results.
Our products and services are complex and could have unknown defects or errors, which may give rise to legal claims against us, diminish our brand or divert our resources from other purposes.
Our products are comprised of and rely on complex and sensitive electronic hardware, algorithms, software, user-friendly interfaces and tightly integrated, electromechanical designs. Despite testing, our products might have contained defects and errors and may in the future contain defects, errors or performance problems when first introduced, when new versions or enhancements are released, or even after these products have been used by our customers for a period of time. These problems could result in expensive and time-consuming design modifications or warranty charges, delays in the introduction of new products or enhancements, significant increases in our service and maintenance costs, exposure to liability for damages, damaged customer relationships and harm to our reputation, any of which could materially harm our results of operations and ability to achieve market acceptance. In addition, increased development and warranty costs could be substantial and could significantly reduce tour operating margins.
10
The existence of any defects, errors, or failures in our products or the misuse of our products could also lead to product liability claims or lawsuits against it. A defect, error or failure in one of our products could result in failure or damage to the products it is embedded in, or property damage, injury, death and/or significant damage our reputation and support for our services in general. We anticipate this risk will grow as more and more products using our products are deployed
We cannot provide any assurance that we have or will have insurance adequate to protect us from material judgments and expenses related to potential future claims or that such insurance will be available in the future at economical prices or at all. Even if we are fully insured as it relates to a particular claim, the claim could nevertheless diminish our brand and divert management’s attention and resources, which could have a negative impact on our business, financial condition and results of operations.
We are a supplier for government programs, which subjects us to risks including early termination, audits, investigations, sanctions, penalties and delayed sales.
We have entered into contracts with governments and government contractors, either directly or indirectly. As a result, we are and may in the future be subject to statutes and regulations applicable to companies doing business with the relevant government. Government contracts may contain provisions that give the government substantial rights and remedies, many of which are not typically found in commercial contracts with private sector counterparts and which are unfavorable to the contractors. For example, many government agencies include provisions that allow the government to unilaterally terminate or modify contracts for convenience, and in that event, the counterparty to the contract may generally recover only its incurred or committed costs and settlement expenses and profit on work completed prior to the termination.
In addition, government contracts typically contain additional requirements that may increase our costs of doing business, reduce our profits, and expose us to liability for failure to comply with these terms and conditions. These requirements may include, for example:
| ● | specialized disclosure and accounting requirements unique to government contracts; |
| ● | financial and compliance audits that may result in potential liability for price adjustments, recoupment of government funds after such funds have been spent, civil and criminal penalties, or administrative sanctions such as suspension or debarment from doing business with government; |
| ● | public disclosures of certain contract and company information; and |
| ● | mandatory socioeconomic compliance requirements, including labor requirements, non-discrimination and affirmative action programs and environmental compliance requirements. |
If we fail to comply with government contracting laws, regulations and contract requirements, our government contracts may be subject to termination, and we may become subject to financial and/or other liability under our contracts or criminal law. Any penalties, damages, fines, suspension, or damages could adversely affect our ability to operate our business and our financial results.
We are also vulnerable to delayed sales to the Israeli government and related contractors as a result of the Israeli government’s repeated failures to timely approve its annual budgets.
Negative customer perception regarding our products could have a material adverse effect on the demand for our products and the business, results of operations, financial condition and cash flows.
We believe that our success is highly dependent upon perception regarding the security, effectiveness and quality of our products’ technology components and products used. Customer perception of these components and products can be significantly influenced by testing results or findings, regulatory investigations, litigation, media attention, and other publicity. There can be no assurance that future testing results, findings, regulatory proceedings, litigation, media attention, or other research findings will be favorable to our technology components and products or the drone and robotics market in general. Future testing reports, findings, regulatory proceedings, litigation, or media attention that are perceived as less favorable than, or that question, earlier testing reports, findings or publicity could have a material adverse effect on the demand for our products and the business, results of operations, financial condition and cash flows. The dependence upon customer perceptions means that adverse testing reports, findings, regulatory proceedings, litigation, or media attention, whether or not accurate or with merit, could have a material adverse effect on us, the demand for our products, and the business, our results of operations, financial condition and cash flows.
11
If we fail to successfully promote our product and brand, it could have a material adverse effect on our business, prospects, financial condition and results of operations.
We believe that brand recognition is an important factor to our success. If we fail to promote our brands successfully, or if the expenses of doing so are disproportionate to any increased net sales we achieve, it would have a material adverse effect on our business, prospects, financial condition and results of operations. This will depend largely on our ability to maintain trust, be a technology leader, and continue to provide high-quality and secure technologies, products and services. Any negative publicity about us or our industry, the quality and reliability of our technologies, products and services, our risk management processes, changes to our technologies, products and services, our ability to effectively manage and resolve customer complaints, our privacy and security practices, litigation, regulatory activity, and the experience of sellers and buyers with our products or services, could adversely affect our reputation and the confidence in and use of our technologies, products and services. Harm to our brand can arise from many sources, including: failure by us or our partners to satisfy expectations of service and quality; inadequate protection of sensitive information; compliance failures and claims; litigation and other claims; employee misconduct; and misconduct by our partners, service providers, or other counterparties. If we do not successfully maintain a strong and trusted brand, our business could be materially and adversely affected.
We may be subject to cybersecurity attacks or electronic communication security risks.
A significant potential vulnerability of electronic communications is the security of transmission of confidential information over public networks, including information pertaining to the identity of our customers, customer orders, customer fleet operations and information managed under our CONTROLiT cloud management software, customer data and information managed and secured by our ICE Cybersecurity solution, as well as current and future hardware and software solutions. Anyone who is able to circumvent our security measures could misappropriate proprietary information or cause interruptions in our operations. We may be required to expend capital and other resources to protect against such security breaches or to alleviate problems caused by such breaches, as well as the exposure of our sites, networks, computers and digital data assets to different cybersecurity attacks.
In addition, a significant invasion, interruption, destruction or breakdown of our information technology systems and/or infrastructure by persons with authorized or unauthorized access, or exposure to different cybersecurity attacks could negatively impact our business and operations. We could also experience business interruption, information theft and reputational damage from cyber-attacks, which may compromise our systems and lead to data leakage either internally or at our third-party providers. Our systems may be the target of malware and other cyber-attacks. Although we have invested in measures to reduce these risks, we cannot assure you that these measures will be successful in preventing compromise or disruption of our information technology systems a data which could have a negative impact on our business, financial condition and results of operations.
Failure to adhere to our financial reporting obligations and other public company requirements could adversely affect the market price of our ordinary shares.
The reporting and other obligations related to being a public company will place significant demands on our management, administrative, operational and accounting resources. If we are unable to meet such demands in a timely and effective manner, our ability to comply with our financial reporting obligations and other rules applicable to reporting issuers could be impaired. Moreover, any failure to maintain effective internal controls could cause us to fail to satisfy our reporting obligations or result in material misstatements in our financial statements. If we cannot provide reliable financial reports or prevent fraud, our reputation and operating results could be materially adversely affected which could also cause investors to lose confidence in our reported financial information, which could result in a reduction in the trading price of our ordinary shares.
12
In addition, we do not expect that our disclosure controls and procedures and internal controls over financial reporting will prevent all errors or fraud. A control system, no matter how well designed and implemented, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues within an organization are detected. The inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by individual acts of certain persons, by collusion of two or more people or by management override of the controls. Due to the inherent limitations in a control system, misstatements due to errors or fraud may occur and may not be detected in a timely manner or at all.
We may experience adverse effects on our reported results of operations as a result of adopting new accounting standards or interpretations.
Our implementation of and compliance with changes in accounting rules, including new accounting rules and interpretations, could adversely affect our reported financial position or operating results or cause unanticipated fluctuations in our reported operating results in future periods.
If securities or industry analysts either do not publish research about us or publish inaccurate or unfavorable research about us, our business or our market, or if they change their recommendations regarding our securities, the trading price or trading volume of our securities could decline.
The trading market for our securities will be influenced in part by the research and reports that securities or industry analysts may publish about us, our business, our market or our competitors. If one or more of the analysts initiate research with an unfavorable rating or downgrade our securities, provide a more favorable recommendation about our competitors or publish inaccurate or unfavorable research about our business, the market prices of our securities would likely decline. If any analyst who may cover us were to cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause the trading price or trading volume of our securities to decline.
Possible force majeure events could impact our operations and the market price of our ordinary shares.
Events may occur within or outside the United States, Australia and Israel that could impact the American and/or Australian and/or Israeli economy, our operations and the market price of our ordinary shares. These events include acts of terrorism, an outbreak of international hostilities, such as the hostilities in Eastern Europe and Ukraine, fires, floods, earthquakes, labor strikes, civil wars, natural disasters, outbreaks of disease or other natural or manmade events or occurrences that can have an adverse effect on the demand for our products and our ability to conduct business. While we seek to maintain insurance in accordance with industry practice to insure against the risks we consider appropriate after consideration of our needs and circumstances, no assurance can be given as to our ability to obtain such insurance coverage in the future at reasonable rates or that any coverage arranged will be adequate and available to cover any and all potential claims. The occurrence of an event that is not covered or fully covered by insurance could have a material adverse effect on our business, financial condition and results of operations.
We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine and in the Middle East. Our business, financial condition and results of operations may be materially adversely affected by any negative impact on the global economy and capital markets resulting from these conflicts or any other geopolitical tensions.
U.S. and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine. On February 24, 2022, a full-scale military invasion of Ukraine by Russian troops was reported. Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine could lead to market disruptions, including significant volatility in credit and capital markets.
13
Additionally, Russia’s prior annexation of Crimea, recent recognition of two separatist republics in the Donetsk and Luhansk regions of Ukraine and subsequent military interventions in Ukraine have led to sanctions and other penalties being levied by the United States, European Union and other countries against Russia, Belarus, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic, and the so-called Luhansk People’s Republic, including agreement to remove certain Russian financial institutions from the Society for Worldwide Interbank Financial Telecommunication, or SWIFT, payment system. Additional potential sanctions and penalties have also been proposed and/or threatened. Russian military actions and the resulting sanctions could adversely affect the global economy and financial markets.
In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. As a result of the events of October 7, 2023, the Israeli government declared that the country was at war and the Israeli military began to call-up reservists for active duty. In October 2025, a ceasefire was brokered between Israel and Hamas. However, we cannot predict if and to what extent this ceasefire will remain in effect or upheld.
Since the commencement of these events, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization) and on other fronts from various extremist groups in the region, such as the Houthis in Yemen and various rebel militia groups in Syria and Iraq. Israel has carried out a number of targeted strikes on sites belonging to these terror organizations. In October 2024, Israel began limited ground operations against Hezbollah in Lebanon, and in November 2024, a ceasefire was brokered between Israel and Hezbollah. However, In March 2026, tensions escalated once again as Hezbollah launched an attack on Israel, firing rockets across the border. In response, Israel carried out targeted airstrikes against Hezbollah positions in Lebanon, raising concerns among the international community about the potential for a wider conflict. In addition, in response to ongoing Iranian aggression and support of proxy attacks against Israel, on June 13, 2025, Israel conducted a series of preemptive defensive air strikes in Iran targeting Iran’s nuclear program and military commanders. While a ceasefire was reached in June 2025 following 12 days of hostilities, on February 28, 2026, the United States and Israel launched coordinated military strikes against Iran, including attacks on strategic military infrastructure and leadership targets, with the stated aim of degrading Iran’s capacity to conduct or support hostile operations against them. In response, Iran has fired missiles and drones toward population centers and military installations in Israel, Europe and neighboring countries in the Gulf region, and also launched counter-strikes against U.S. forces and allied bases throughout the Gulf region. Continued military escalation, retaliatory actions, or broader regional involvement may adversely affect economic conditions, disrupt markets, and create uncertainty that could negatively impact our business, financial condition and results of operations. Additionally, following the fall of the Assad regime in Syria, Israel has conducted limited military operations targeting the Syrian army, Iranian military assets and infrastructure linked to Hezbollah and other Iran-supported groups. It is possible that hostilities with Iran, Hezbollah, the Houthis and terrorist groups in Syria will escalate, and that other terrorist organizations, including Palestinian military organizations in the West Bank, will join the hostilities. The underlying tensions driving these conflicts remain unresolved. The ongoing hostilities between Israel and Iran or Hezbollah — whether through direct military action, proxy escalation, or retaliatory strikes — could result in significant disruption to civilian infrastructure, supply chains, and personnel availability across Israel. Such escalation could materially and adversely affect our operations, which are primarily conducted through our Israeli subsidiary, Mobilicom Ltd. To date, only one of our employees is in active military reserve duty. Nevertheless, our product, research and development and business development activities remain on track. See also “Item 3.D — Risk Factors — Risks Related to Israeli Law and our Operations in Israel — Political, economic and military instability in Israel may impede our ability to operate and harm our financial results” for additional information.
Any of the abovementioned factors could affect our business, prospects, financial condition, and operating results. The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this Annual Report on Form 20-F.
We are subject to certain Israeli, U.S. and foreign anti-corruption, anti-money laundering, export control, sanctions and other trade laws and regulations. We can face serious consequences for violations.
Among other matters, Israeli, U.S. and foreign anticorruption, anti-money laundering, export control, sanctions and other trade laws and regulations, which are collectively referred to as Trade Laws, prohibit companies and their employees, agents, legal counsel, accountants, consultants, contractors and other partners from authorizing, promising, offering, providing, soliciting or receiving, directly or indirectly, corrupt or improper payments or anything else of value to or from recipients in the public or private sector. Violations of Trade Laws can result in substantial criminal fines and civil penalties, imprisonment, the loss of trade privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences. We have direct or indirect interactions with officials and employees of government agencies or government-affiliated entities. We can be held liable for the corrupt or other illegal activities of our personnel, agents or partners, even if we do not explicitly authorize or have prior knowledge of such activities.
14
Our business, operating results and growth rates may be adversely affected by current or future unfavorable economic and market conditions and adverse developments with respect to financial institutions and associated liquidity risk.
Our business depends on the economic health of the global economies. If the conditions in the global economies remain uncertain or continue to be volatile, or if they deteriorate, including as a result of the impact of military conflict, such as the war between Russia and Ukraine, terrorism or other geopolitical events, our business, operating results and financial condition may be materially adversely affected. Economic weakness, inflation and increases in interest rates, limited availability of credit, liquidity shortages and constrained capital spending have at times in the past resulted, and may in the future result, in challenging and delayed sales cycles, slower adoption of new technologies and increased price competition, and could negatively affect our ability to forecast future periods, which could result in an inability to satisfy demand for our products and a loss of market share.
In addition, increases in inflation raise our costs for commodities, labor, materials and services and other costs required to grow and operate our business, and failure to secure these on reasonable terms may adversely impact our financial condition. Additionally, increases in inflation, geopolitical developments and global supply chain disruptions, have caused, and may in the future cause, global economic uncertainty and uncertainty about the interest rate environment, which may make it more difficult, costly or dilutive for us to secure additional financing. A failure to adequately respond to these risks could have a material adverse impact on our financial condition, results of operations or cash flows.
There can be no assurance that future credit and financial market instability and a deterioration in confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any such economic downturn, liquidity shortages, volatile business environment or continued unpredictable and unstable market conditions. If the current equity and credit markets deteriorate, or if adverse developments are experienced by financial institutions, it may cause short-term liquidity risk and also make any necessary debt or equity financing more difficult, more costly, more onerous with respect to financial and operating covenants and more dilutive. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to alter our operating plans. In addition, there is a risk that one or more of our service providers, financial institutions, manufacturers, suppliers and other partners may be adversely affected by the foregoing risks, which could directly affect our ability to attain our operating goals on schedule and on budget.
Scrutiny of sustainability and environmental, social, and governance, or ESG, initiatives could increase our costs or otherwise adversely impact our business.
Public companies have recently faced scrutiny related to ESG practices and disclosures from certain investors, capital providers, shareholder advocacy groups, other market participants and other stakeholder groups. Such scrutiny may result in increased costs, enhanced compliance or disclosure obligations, or other adverse impacts on our business, financial condition or results of operations. If our ESG practices and reporting do not meet investor or other stakeholder expectations, we may be subject to investor or regulator engagement regarding such matters. Our failure to comply with any applicable ESG rules or regulations could lead to penalties and adversely impact our reputation, access to capital and employee retention. Such ESG matters may also impact our third-party contract manufacturers and other third parties on which we rely, which may augment or cause additional impacts on our business, financial condition, or results of operations.
From time to time, we may become involved in legal proceedings, which could adversely affect us.
We may, from time to time in the future, become subject to legal proceedings, claims, litigation and government investigations or inquiries, which could be expensive, lengthy, and disruptive to normal business operations. In addition, the outcome of any legal proceedings, claims, litigation, investigations or inquiries may be difficult to predict and could have a material adverse effect on our business, operating results, or financial condition.
Our directors and officers may have conflicts of interest in conducting their duties.
Because our directors and officers are or may become directors or officers of other reporting companies or have significant shareholdings in other technology companies, our directors and officers may have conflicts of interest in conducting their duties. We and our directors and officers will attempt to minimize such conflicts. In the event that such a conflict of interest arises at a meeting of the directors, a director who has such a conflict will abstain from voting for or against a particular matter in which the director has the conflict. In appropriate cases, we will establish a special committee of independent directors to review a particular matter in which several directors, or officers, may have a conflict. In determining whether or not we will participate in a particular program and the interest therein to be acquired by us, the directors will primarily consider the potential benefits to us, the degree of risk to which we may be exposed and our financial position at that time. Other than as indicated, we have no other procedures or mechanisms to deal with conflicts of interest.
15
Executive officers and directors may have rights to indemnification from us, including pursuant to directors’ and officers’ liability insurance policies that will survive termination of their agreements.
Risks Related to Our Intellectual Property
If we fail to protect, or incur significant costs in defending, our intellectual property and other know-how or proprietary rights, our business, financial condition, and results of operations could be materially harmed.
Our success depends, in large part, on our ability to protect our intellectual property, know-how and other proprietary rights. We rely primarily on patents, trademarks, copyrights, trade secrets other contractual provisions, to protect our intellectual property and other proprietary rights. However, a portion of our technology and know-how is not patented, and we may be unable or may not seek to obtain patent protection for this technology. The existing US legal standards relating to the validity, enforceability and scope of protection of intellectual property rights offer only limited protection, may not provide us with any competitive advantages, and may be challenged by third parties. The laws of countries other than US may be even less protective of intellectual property rights. Accordingly, despite our efforts, we may be unable to prevent third parties from infringing upon or misappropriating our intellectual property or otherwise gaining access to our technology. Unauthorized third parties may try to copy or reverse engineer our products or portions of our products or otherwise obtain and use our intellectual property. Many of our employees have access to our trade secrets and other intellectual property. If one or more of these employees leave the Company and will be employed by one of our competitors, then they may disseminate proprietary information, which may as a result damage our competitive position. If we fail to protect our intellectual property and other proprietary rights, then our business, results of operations or financial condition could be materially harmed. From time to time, we may have to initiate lawsuits to protect our intellectual property and other proprietary rights. Pursuing these claims is time consuming and expensive and could adversely impact our results of operations.
In addition, affirmatively defending our intellectual property rights and investigating whether we are pursuing a product or service development that may violate the rights of others may entail significant expense. Any of our intellectual property rights may be challenged by others or invalidated through administrative processes or litigation. If we resort to legal proceedings to enforce our intellectual property rights or to determine the validity and scope of the intellectual property or other proprietary rights of others, then the proceedings could result in significant expense to us and divert the attention and efforts of our management and technical employees, even if we prevail.
Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
The United States Patent and Trademark Office, or USPTO, and various foreign national or international patent agencies require compliance with a number of procedural, documentary, fee payment, and other similar provisions during the patent application process. Periodic maintenance fees on any issued patent are due to be paid to the USPTO and various foreign national or international patent agencies in several stages over the lifetime of the patent. While an inadvertent lapse can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which non-compliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. Non-compliance events that could result in abandonment or lapse of patent rights include, but are not limited to, failure to timely file national and regional stage patent applications based on our international patent application, failure to respond to official actions within prescribed time limits, non-payment of fees, and failure to properly legalize and submit formal documents. If we fail to maintain the patents and patent applications covering our products, our competitors might be able to enter the market, which would have a material adverse effect on our business.
While a patent may be granted by a national patent office, there is no guarantee that the granted patent is valid. Options exist to challenge the validity of a patent which, depending upon the jurisdiction, may include re-examination, opposition proceedings before the patent office, and/or invalidation proceedings before the relevant court. Patent validity may also be the subject of a counterclaim to an allegation of patent infringement.
16
Pending patent applications may be challenged by third parties in protest or similar proceedings. Third parties can typically submit prior art material to patentability for review by the patent examiner. Regarding Patent Cooperation Treaty applications, a positive opinion regarding patentability issued by the International.
Searching Authority does not guarantee allowance of a national application derived from the Patent Cooperation Treaty application. The coverage claimed in a patent application can be significantly reduced before the patent is issued, and the patent’s scope can be modified after issuance. It is also possible that the scope of claims granted may vary from jurisdiction to jurisdiction.
The grant of a patent does not have any bearing on whether the invention described in the patent application would infringe the rights of earlier filed patents. It is possible to both obtain patent protection for an invention and yet still infringe the rights of an earlier granted patent.
We may be sued by third parties for alleged infringement of their proprietary rights, which could be costly, time-consuming and limit our ability to use certain technologies in the future.
We may become subject to claims that our technologies infringe upon the intellectual property or other proprietary rights of third parties. Any claims, with or without merit, could be time-consuming and expensive, and could divert our management’s attention away from the execution of our business plan. Moreover, any settlement or adverse judgment resulting from these claims could require us to pay substantial amounts or obtain a license to continue to use the disputed technology, or otherwise restrict or prohibit our use of the technology. We cannot assure that we would be able to obtain a license from the third party asserting the claim on commercially reasonable terms, if at all, that we would be able to develop alternative technology on a timely basis, if at all, or that we would be able to obtain a license to use a suitable alternative technology to permit us to continue offering, and our customers to continue using, our affected product. An adverse determination also could prevent us from offering our products to others. Infringement claims asserted against us may have a material adverse effect on our business, results of operations or financial condition.
We may not be able to protect our intellectual property rights throughout the world.
Filing, prosecuting, and defending patents on all of our products throughout the world would be prohibitively expensive. Therefore, we have filed applications and/or obtained patents only in the United States. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and their products may compete with our products.
Risks Related to Israeli Law and our Operations in Israel
Political, economic and military instability in Israel may impede our ability to operate and harm our financial results.
Although we are an Australian company, our fully owned subsidiary and main operational, including our principal research and development facilities and sole manufacturing facility, and certain of our key employees, officers and directors are located in Israel. Accordingly, political, geopolitical, economic and military conditions in Israel may directly affect our business. Since the establishment of the State of Israel in 1948, a number of armed conflicts have taken place between Israel and its neighboring Arab countries, Hamas (an Islamist terrorist militia and political group that controls the Gaza strip), Hezbollah (an Islamist terrorist militia and political group based in Lebanon) and other terrorist organizations active in the region. These conflicts have involved missile strikes, hostile infiltrations and terrorism against civilian targets in various parts of Israel, which have negatively affected business conditions in Israel. Any hostilities involving Israel or the interruption or curtailment of trade between Israel and its trading partners could negatively affect business conditions in Israel in general and our business in particular, and adversely affect our product development, operations and results of operations. Ongoing and revived hostilities or other Israeli political or economic factors, such as, an interruption of operations at the Tel Aviv airport or the nautical routes, could prevent or delay shipments of our components or products.
In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in extensive deaths, injuries and kidnapping of civilians and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and a military campaign against these terrorist organizations commenced in parallel to their continued rocket and terror attacks. In October 2025, a ceasefire was brokered between Israel and Hamas. However, we cannot predict if and to what extent this ceasefire will remain in effect or upheld.
17
Since the commencement of these events, there have been continued hostilities along Israel’s northern border with the Hezbollah terror organization), with Iran, the Houthis in Yemen and on other fronts with various extremist groups in the region, such as various rebel militia groups in Syria and Iraq. In October 2024, Israel began limited ground operations against Hezbollah in Lebanon, and in November 2024, a ceasefire was brokered between Israel and Hezbollah. However, we cannot predict if and to what extent this ceasefire will remain in effect or upheld. In addition, in June 2025, in light of continued nuclear threats and intelligence assessments indicating imminent attacks, Israel launched a preemptive strike directly targeting military and nuclear infrastructure inside Iran, aimed at disrupting Iran’s capacity to coordinate or launch further hostilities against Israel, as well as to degrade its nuclear program. In response, Iran launched multiple waves of drones and ballistic missiles at Israeli cities. While most of these attacks were intercepted, several caused civilian casualties and damage to infrastructure. The Israeli military conducted additional operations against Iranian assets. While a ceasefire was reached between Israel and Iran in June 2025 after 12 days of hostilities, the situation remains volatile. Additionally, following the fall of the Assad regime in Syria, Israel has conducted limited military operations targeting the Syrian army, Iranian military assets and infrastructure linked to Hezbollah and other Iran-supported groups. It is possible that hostilities with Iran, Hezbollah, the Houthis and terrorist groups in Syria will escalate, and that other terrorist organizations, including Palestinian military organizations in the West Bank, will join the hostilities. Iran, who launched direct attacks on Israel involving drones and missiles, is also believed to have a strong influence among extremist groups in the region, such as Hamas in Gaza, Hezbollah in Lebanon, the Houthis in Yemen and various rebel militia groups in Syria and Iraq. These situations may potentially escalate in the future to more violent events which may affect Israel and us. Any hostilities, armed conflicts, terrorist activities involving Israel or the interruption or curtailment of trade between Israel and its trading partners, or any political instability in the region could adversely affect business conditions and our results of operations and could make it more difficult for us to raise capital and could adversely affect the market price of our ordinary shares. An escalation of tensions or violence might result in a significant downturn in the economic or financial condition of Israel, which could have a material adverse effect on our operations in Israel and our business. Parties with whom we do business have sometimes declined to travel to Israel during periods of heightened unrest or tension, forcing us to make alternative arrangements when necessary in order to meet our business partners face to face. In addition, the political and security situation in Israel may result in parties with whom we have agreements involving performance in Israel claiming that they are not obligated to perform their commitments under those agreements pursuant to force majeure provisions in such agreements.
Since the war broke out on October 7, 2023, our operations have not been adversely affected by this situation, and we have not experienced disruptions to our business operations. As such, our product research and development and business development activities remain on track. However, while the intensity and duration of the security situation in Israel have been difficult to predict, as were the economic implications on our business and operations and on Israel’s economy in general, the ceasefire marks a potential shift towards stability in the region. If sustained, this could reduce the risk of disruptions to our business and the Israeli economy in general. However, if the war is renewed or expands to other fronts, such as Gaza, Iran, Lebanon, Syria or the West Bank, our operations may be harmed.
Any armed conflicts, terrorist activities or political instability in the region could adversely affect business conditions, could harm our results of operations and the market price of our Ordinary Shares, and could make it more difficult for us to raise capital. Parties with whom we do business may sometimes decline to travel to Israel during periods of heightened unrest or tension, forcing us to make alternative arrangements when necessary, in order to meet our business partners face to face. Several countries, principally in the Middle East, still restrict doing business with Israel and Israeli companies, and additional countries may impose restrictions on doing business with Israel and Israeli companies if hostilities in Israel or political instability in the region continues or increases. Similarly, Israeli companies are limited in conducting business with entities from several countries. For instance, in 2008, the Israeli legislature passed a law forbidding any investments in entities that transact business with Iran.
Our insurance does not cover losses that may occur as a result of events associated with war and terrorism. Although the Israeli government currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot assure you that this government coverage will be maintained or that it will sufficiently cover our potential damages. Any losses or damages incurred by us could have a material adverse effect on our business. Any armed conflicts or political instability in the region would likely negatively affect business conditions and could harm our results of operations.
Finally, political conditions within Israel may affect our operations. Israel has held five general elections between 2019 and 2022, and prior to October 2023, the Israeli government pursued extensive changes to Israel’s judicial system, which sparked extensive political debate and unrest. Actual or perceived political instability in Israel or any negative changes in the political environment, may individually or in the aggregate adversely affect the Israeli economy and, in turn, our business, financial condition, results of operations and growth prospects.
Our operations may be disrupted by the obligations of personnel to perform military service.
As of March 22, 2026, we had 38 employees, 29 of whom were based in Israel. Some of our employees may be called upon to perform up to 84 days (and in some cases more) of annual military reserve duty until they reach the age of 41 (and in some cases, up to 46 or older) and, in emergency circumstances, could be called to immediate and unlimited active duty. In the event of severe unrest or other conflict, individuals could be required to serve in the military for extended periods of time. Since September 2000, in response to increased tension and hostilities, there have been occasional call-ups of military reservists, including in connection with the 2006 conflict in Lebanon, the December 2008, November 2012 and, July 2014 conflicts with Hamas, and in connection with the war that broke out on October 7, 2023, and it is possible that there will be additional call-ups in the future. Our operations could be disrupted by the absence of a significant number of our employees related to military service or the absence for extended periods of one or more of our key employees for military service. Such disruption could materially adversely affect our business and results of operations. Additionally, the absence of a significant number of the employees of our Israeli suppliers and contractors related to military service or the absence for extended periods of one or more of their key employees for military service may disrupt their operations.
18
We may become subject to claims for remuneration or royalties for assigned service invention rights by our employees, which could result in litigation and adversely affect our business.
A significant portion of our intellectual property and know-how has been developed by our employees in the course of their employment for us. Under the Israeli Patent Law, 1967, or the Patent Law, inventions conceived by an employee in the course of and as a result of or arising from his or her employment with a company are regarded as “service inventions,” which belong to the employer, absent a specific agreement between the employee and employer giving the employee service invention rights. The Patent Law also provides that if there is no such agreement between an employer and an employee, the Israeli Compensation and Royalties Committee, or the Committee, a body constituted under the Patent Law, will determine whether the employee is entitled to remuneration for his inventions. Israeli case law clarifies that the right to receive consideration for “service inventions” can be waived by the employee and that in certain circumstances, such waiver does not necessarily have to be explicit. The Committee will examine, on a case-by-case basis, the general contractual framework between the parties, using interpretation rules of the general Israeli contract laws. Further, the Committee has not yet determined one specific formula for calculating this remuneration (but rather uses the criteria specified in the Patent Law). Although we have entered into assignment-of-invention agreements with our current and former employees pursuant to which such individuals assign to us all rights to any inventions created in the scope of their employment or engagement with us, we may still face claims demanding remuneration in consideration for assigned inventions. If such claims are found to have merit despite our assignment of invention agreements, we could be required to pay additional remuneration or royalties to our current and/or former employees, or be forced to litigate such claims, which could negatively affect our business.
We received Israeli government grants, from the IIA for certain of our research and development activities, the terms of which may require us to pay royalties and to satisfy specified conditions (including prior approvals) in order to manufacture products and transfer technologies, IP and knowhow outside of Israel. If we fail to satisfy these conditions, we may be required to pay penalties and refund some grants previously received, such failure may also result in incarceration sentence.
Our research and development efforts were financed in part through royalty-bearing grants from the IIA. With respect to such grants, we are committed to pay royalties at a rate of 3% to 3.5% on sales proceeds from our products that were developed under IIA programs up to the total amount of grants received, linked to the U.S. dollar and bearing interest at an annual rate of SOFR applicable to U.S. dollar deposits.
Regardless of any royalty payment, we are further required to comply with the requirements of the Israeli Encouragement of Industrial Research, Development and Technological Innovation Law, 1984, as amended, and related regulations, or the Research Law, with respect to those past grants. When a company develops know-how, technology or products using IIA grants, the terms of these grants and the Research Law restrict the transfer of such know-how, and the transfer of manufacturing or manufacturing rights of such products, technologies or know-how outside of Israel, without the prior approval of the IIA. We may not receive those approvals. Furthermore, the IIA may impose certain conditions on any arrangement under which it permits us to transfer technology or development. This may restrict our ability to move the production of our products outside of Israel, or to sell intellectual property and other know-how.
We may be subject to the risks associated with the Israeli Law for the Encouragement of Industrial Research and Development 5744-1984 (R&D Law).
While our products currently are not required to comply with any regulatory obligations in Israel, the R&D Law, as amended, and related regulations, may restrict our ability to move the production of products developed using grants received from the IIA. We received Israeli government grants from the IIA for certain of our research and development activities, the terms of which may require us to pay royalties and to satisfy specified conditions in order to manufacture products and transfer technologies outside of Israel. If we fail to satisfy these conditions, we may be required to pay penalties and refund grants previously received. Such failure may also result in incarceration sentence. As of December 31, 2025, we have received grants of $2.48 million.
Risks Related to the Ownership of our Ordinary Shares
The market price and trading volume of our ordinary shares may be volatile and may be affected by economic conditions beyond our control.
The market price of our ordinary shares may be highly volatile and subject to wide fluctuations. In addition, the trading volume of our ordinary shares may fluctuate and cause significant price variations to occur. If the market price of our ordinary shares declines significantly, you may be unable to resell your ordinary shares at or above the purchase price, if at all. We cannot assure you that the market price of our ordinary shares will not fluctuate or significantly decline in the future.
Some specific factors that could negatively affect the price of our ordinary shares or result in fluctuations in their price and trading volume include:
| ● | actual or expected fluctuations in our operating results; |
| ● | changes in market valuations of similar companies; |
19
| ● | changes in our key personnel; |
| ● | changes in financial estimates or recommendations by securities analysts; |
| ● | trading prices of our ordinary shares on the Nasdaq Capital Market, or Nasdaq; |
| ● | changes in trading volume of ordinary shares on Nasdaq; |
| ● | sales of our ordinary shares or ordinary shares by us, our executive officers or our shareholders in the future; and |
| ● | conditions in the financial markets or changes in general economic conditions. |
A shareholder’s holding may be diluted if we issue additional shares or other securities in the future.
We may issue additional ordinary shares or other securities in the future, which may dilute your holding in us. Our Constitution permits the issuance of an unlimited number of securities, subject to certain capacity restrictions and security-holders have no pre-emptive rights in connection with further issuances of any securities. Our directors have the discretion to determine if an issuance of ordinary shares or other securities is warranted, the price at which any such securities are issued and the other terms of issue of such securities. In addition, we may issue additional ordinary shares upon the exercise of warrants to acquire ordinary shares under our share incentive plan, which will result in further dilution. In addition, the issuance of ordinary shares or other securities in any potential future acquisitions, if any, may also result in further dilution to your interests.
As a foreign private issuer, we are permitted and we expect to follow certain home country corporate governance practices in lieu of certain Nasdaq requirements applicable to domestic issuers. This may afford less protection for our shareholders.
As a foreign private issuer with ordinary shares listed on Nasdaq, we are permitted to follow certain home country corporate governance practices in lieu of certain Nasdaq requirements. We follow home country practice with regard to the composition of the board of directors, quorum requirements applicable to shareholder meetings, shareholder approval prior to the issuance of securities in connection with certain acquisitions, private placements of securities, or the establishment or amendment of certain stock option, purchase or other compensation plans and the requirement that issuers must maintain charters for certain board committees. As a foreign private issuer we must disclose in our annual reports filed with the SEC the requirements with which it does not comply followed by a description of our applicable home country practice. The Australian home country practices described above may afford less protection to holders of ordinary shares than that provided under Nasdaq rules.
As a foreign private issuer, we are permitted to file less information with the SEC than a company incorporated in the United States. Accordingly, there may be less publicly available information concerning us than there is for companies incorporated in the United States.
As a foreign private issuer, we are exempt from the rules and regulations under the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, related to the furnishing and content of proxy statements. Section 8103 of the National Defense Authorization Act for Fiscal Year 2026 named, the “Holding Foreign Insiders Accountable Act” was signed into law on December 18, 2025, will require directors and officers of foreign private issuers to make insider reports under Section 16(a) of the Exchange Act, effective March 18, 2026. Our principal shareholders continue to remain exempt from the reporting under Section 16(a) of the Exchange Act and our directors, officers and principal shareholders continue to remain exempt from the short-swing profit recovery provisions contained in Section 16(b) of the Exchange Act. In addition, we will not be required under the Exchange Act to file annual, quarterly and current reports and financial statements with the SEC as frequently or as promptly as domestic companies whose securities are registered under the Exchange Act.
20
We are an emerging growth company as defined in the JOBS Act and the reduced disclosure requirements applicable to emerging growth companies may make our ordinary shares less attractive to investors and, as a result, adversely affect the price of our ordinary shares and result in a less active trading market for our ordinary shares.
We are an emerging growth company as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. For example, we have elected to rely on an exemption from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act relating to internal control over financial reporting, and we will not provide such an attestation from our auditors for so long as we qualify as an emerging growth company.
We may avail ourselves of these disclosure exemptions until we are no longer an emerging growth company. We cannot predict whether investors will find our ordinary shares less attractive because of our reliance on some or all of these exemptions. If investors find our ordinary shares less attractive, it may cause the trading price of the ordinary shares to decline and there may be a less active trading market for our ordinary shares.
We will cease to be an emerging growth company upon the earliest of:
| ● | the end of the fiscal year in which the fifth anniversary of completion of our initial public offering occurs; |
| ● | the end of the first fiscal year in which the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the end of the second quarter of such fiscal year; |
| ● | the end of the first fiscal year in which we have total annual gross revenues of at least $1.235 billion; and |
| ● | the date on which we have issued more than $1.0 billion in non-convertible debt securities in any rolling three-year period. |
If we fail to establish and maintain proper internal financial reporting controls, our ability to produce accurate consolidated financial statements or comply with applicable regulations could be impaired.
As an emerging growth company under the JOBS Act, our management is required to report upon the effectiveness of our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act. Our independent registered public accounting firm is not required to formally attest to the effectiveness of our internal control over financial reporting until the date we are no longer an emerging growth company and reach accelerated filer status. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations. In addition, any testing by us conducted in connection with Section 404 of the Sarbanes-Oxley Act may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement. We cannot assure you that there will not be material weaknesses or deficiencies that we will identify in the future.
If we are unable to conclude that we have effective internal controls over financial reporting, investors may lose confidence in our operating results, the price of our ordinary shares could decline and we may be subject to litigation or regulatory enforcement actions. In addition, if we are unable to meet the requirements of Section 404 of the Sarbanes-Oxley Act, our ordinary shares may not be able to remain listed on Nasdaq.
21
We may be or may become classified as a passive foreign investment company. If we are or become classified as a passive foreign investment company, U.S. holders of our ordinary shares may suffer adverse tax consequences as a result.
Generally, for any taxable year, if at least 75% of our gross income is passive income, or at least 50% of the value of our assets is attributable to assets that produce passive income or are held for the production of passive income, including cash, we would be characterized as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes. For purposes of these tests, passive income includes dividends, interest gains from commodities and securities transactions, the excess of gains over losses from the disposition of assets which produce passive income (including amounts derived by reason of the temporary investment of funds raised in offerings of our shares) and rents and royalties other than rents and royalties which are received from unrelated parties in connection with the active conduct of a trade or business. If we are characterized as a PFIC, U.S. holders of our ordinary shares may suffer adverse tax consequences, including having gains realized on the sale of our ordinary shares treated as ordinary income, rather than capital gain, the loss of the preferential rate applicable to dividends received on our ordinary shares by individuals who are U.S. holders, and having interest charges apply to distributions by us and gains from the sales of our shares.
Our status as a PFIC will depend on the nature and composition of our income and the nature, composition and value of our assets (which, assuming we are not a “controlled foreign corporation,” or a CFC, under Section 957(a) of the Internal Revenue Code of 1986, as amended, or the Code, for the year being tested, may be determined based on the fair market value of each asset, with the value of goodwill and going concern value determined in large part by reference to the market value of our ordinary shares, which may be volatile). We believe that we were not a PFIC for U.S. federal income tax purposes for our 2025 taxable year. Further, because the determination of whether we are a PFIC for any taxable year is a factual determination made annually after the end of each taxable year, there can be no assurance that we will not be considered a PFIC in any taxable year.
The tax consequences that would apply if we are classified as a PFIC would also be different from those described above if a U.S. holder of our ordinary shares was able to make a valid qualified electing fund, or QEF election. If the U.S. Internal Revenue Service, or the IRS, determines that we are a PFIC for a year with respect to which we have determined that we were not a PFIC, it may be too late for a U.S. taxpayer to make a timely QEF or mark-to-market election. U.S. taxpayers that have held our ordinary shares during a period when we were a PFIC will generally be subject to the foregoing rules unless we cease to be a PFIC and you make a “deemed sale” election with respect our ordinary shares. If we are a PFIC in any year, U.S. taxpayers may be subject to additional IRS filing requirements, including the filing of IRS Form 8621, as a result of directly or indirectly owning stock of a PFIC. We do not intend to notify U.S. taxpayers that hold our ordinary shares if we believe we will be treated as a PFIC for any taxable year in order to enable U.S. taxpayers to consider whether to make a QEF election. In addition, we do not intend to furnish such U.S. taxpayers annually with information needed in order to complete IRS Form 8621 and to make and maintain a valid QEF election for any year in which we are a PFIC. U.S. taxpayers that hold our ordinary shares are strongly urged to consult their tax advisors about the PFIC rules, including tax return filing requirements and the eligibility, manner, and consequences to them of making a QEF or mark-to-market election with respect to our ordinary shares in the event that we are a PFIC. If we are unable to provide this information, the QEF election will not be available to you. Prospective investors should assume that a QEF election will not be available. See also “Item 10.E.—Taxation—Certain Material U.S. Federal Income Tax Considerations—Passive Foreign Investment Companies.”
22
We have never declared or paid dividends on our ordinary shares and we do not anticipate paying dividends in the foreseeable future.
We have never declared or paid cash dividends on our ordinary shares. For the foreseeable future, we currently intend to retain all available funds and any future earnings to support our operations and to finance the growth and development of our business. Any future determination to declare cash dividends will be made at the discretion of our board of directors, subject to compliance with applicable laws and covenants under current or future credit facilities, which may restrict or limit our ability to pay dividends, and will depend on our financial condition, operating results, capital requirements, general business conditions and other factors that our board of directors may deem relevant. We do not anticipate paying any cash dividends on our ordinary shares in the foreseeable future. As a result, a return on your investment will only occur if the ordinary shares price increases.
Australian takeover laws may discourage takeover offers being made for us or may discourage the acquisition of a significant position in our ordinary shares.
We are incorporated in Australia and are subject to the takeover laws of Australia. Among other things, we are subject to the Australian Corporations Act 2001, or the Corporations Act. Subject to a range of exceptions, the Corporations Act prohibits the acquisition of a direct or indirect interest in our issued voting shares if the acquisition of that interest will lead to a person’s voting power (either alone or in combination with their ‘associates’ as that term is defined in the Corporations Act) in us increasing to more than 20%, or increasing from a starting point that is above 20% and below 90%. Australian takeover laws may discourage takeover offers being made for us or may discourage the acquisition of a significant position in our ordinary voting shares. This may have the ancillary effect of entrenching our board of directors and may deprive or limit our shareholders’ opportunity to sell their ordinary shares and may further restrict the ability of our shareholders’ ability to obtain a premium from such transactions. Our Constitution, which is included as an exhibit to this Annual Report on Form 20-F, also contains a requirement for our shareholders to approve any proportionate takeover bid (i.e. a bid for a specified proportion of a class of securities in us) without the approval of a majority of our shareholders voting at a general meeting. The renewal of these provisions has not, however, been approved by shareholders in the last three years and accordingly the provisions with respect to proportional takeover bids contained in our Constitution have lapsed. Shareholders may however approve renewal of these provisions in future, which may have the effect of discouraging proportionate takeover bids and limit our shareholders’ opportunity to obtain a premium for their securities from such a transaction.
Anti-takeover provisions in our Constitution and our right to issue preference shares could make a third-party acquisition of us difficult.
Some provisions of our Constitution may discourage, delay or prevent a change in control of our company or management that shareholders may consider favorable, including provisions that only require one-third of our board of directors to be elected annually and authorize our board of directors, subject to compliance with the Corporations Act, to issue an unlimited number of shares of capital stock and preference shares in one or more series and to designate the price, rights, preferences, privileges and restrictions of such preference shares by amending the Constitution (although it should be noted that the amendment of the Constitution requires the approval of shareholders by a majority of not less than 75% of votes cast (directly or by proxy) at a shareholder meeting).
Our Constitution and Australian laws and regulations applicable to us may adversely affect our ability to take actions that could be beneficial to our shareholders.
As an Australian company, we are subject to different corporate requirements than a corporation organized under the laws of the states of the United States. Our Constitution, as well as the Australian Corporations Act, set forth various rights and obligations that are unique to us as an Australian company. These requirements may operate differently than those of many U.S. companies. You should carefully review the summary of these matters set forth in our Constitution, which is included as an exhibit to this Annual Report on Form 20-F, prior to investing in our ordinary shares.
23
You will have limited ability to bring an action against us or against our directors and officers, or to enforce a judgment against us or them, because we are incorporated in Australia and certain of our directors and officers reside outside the United States.
We are incorporated in Australia, the majority of our directors and officers reside outside the United States and substantially all of the assets of those persons are located outside the United States. As a result, it may be impracticable or at least more expensive for you to bring an action against us or against these individuals in Australia in the event that you believe that your rights have been infringed under the applicable securities laws or otherwise. In addition, as a company incorporated in Australia, the provisions of the Corporations Act regulate the circumstances in which shareholder derivative actions may be commenced, which may be different to the circumstances for companies incorporated in the United States.
Further, it may not be possible or practicable for you to effect service of process within the United States upon our officers or directors or to enforce against them or against us judgments obtained in U.S. courts predicated upon the civil liability provisions of the federal securities laws of the United States. Even if you are successful in bringing such an action, there is doubt as to whether Australian courts would enforce certain civil liabilities under U.S. securities laws in original actions or judgments of U.S. courts based upon these civil liability provisions. In addition, awards of punitive damages in actions brought in the United States or elsewhere may be unenforceable in Australia or elsewhere outside the United States. An award for monetary damages under U.S. securities laws would be considered punitive if it does not seek to compensate the claimant for loss or damage suffered and is intended to punish the defendant. The enforceability of any judgment in Australia will depend on the particular facts of the case as well as the laws and treaties in effect at the time. The United States and Australia do not currently have a treaty or statute providing for recognition and enforcement of the judgments of the other country (other than arbitration awards) in civil and commercial matters. As a result, shareholders may have more difficulty in protecting their interests through actions against us, our management or our directors than would shareholders of a corporation incorporated in a jurisdiction in the United States.
Australian companies may not be able to initiate shareholder derivative actions, thereby depriving shareholders of the ability to protect their interests.
Australian companies may not have standing to initiate a shareholder derivative action in a federal court of the United States. The circumstances in which any such action may be brought, and the procedures and defenses that may be available in respect to any such action, may result in the rights of shareholders of an Australian company being more limited than those of shareholders of a company organized in the United States. Accordingly, shareholders may have fewer alternatives available to them if they believe that corporate wrongdoing has occurred. Australian courts are also unlikely to recognize or enforce against us judgments of courts in the United States based on certain liability provisions of U.S. securities law and to impose liabilities against us, in original actions brought in Australia, based on certain liability provisions of U.S. securities laws that are penal in nature. There is no statutory recognition in Australia of judgments obtained in the United States, although the courts of Australia may recognize and enforce the non-penal judgment of a foreign court of competent jurisdiction without retrial on the merits, upon being satisfied about all the relevant circumstances in which that judgment was obtained.
24
ITEM 4. INFORMATION ON THE COMPANY
A. History and Development of the Company
We were incorporated under the laws of Australia in 2017. We have an office at Level 21, 459 Collins Street, Melbourne, VIC, Australia, 3000. Our telephone number is +61 3 8630 3321. Our operational headquarters are located at 1 Rakefet Street, Shoham, Israel 6083705. Mobilicom Inc., incorporated in Delaware, is registered in 1000 N. West Street, Wilmington, Delaware under the registered agent MWE Corporate Services LLC.
Our Company commercial website address is https://mobilicom.com/ and our investors relations website address is https://ir.mobilicom.com/. Information contained on or accessible through our website is not a part of this Annual Report on Form 20-F, and the inclusion of our website address herein is an inactive textual reference only. The SEC also maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Our filings with the SEC will also be available to the public through the SEC’s website at www.sec.gov. Mobilicom Inc. serves as our authorized representative and agent for service of process in the United States for certain limited matters.
We are a foreign private issuer as defined by the rules under the Securities Act and the Exchange Act. Our status as foreign private issuer also exempts us from compliance with certain laws and regulations of the SEC and certain regulations of the Nasdaq Stock Market, including the proxy rules, the short-swing profits recapture rules, and certain governance requirements such as independent director oversight of the nomination of directors and executive compensation. In addition, we will not be required to file annual, quarterly and current reports and financial statements with the SEC as frequently or as promptly as U.S. domestic companies registered under the Exchange Act.
Our cash used in investing activities for 2023, 2024, and 2025 amounted to approximately $13,000, $27,000 and $37,000, respectively. The cash was used primarily for purchases of fixed assets. Our purchases of fixed assets primarily include computers and lab equipment used for the development of our products, and we finance these expenditures primarily from cash on hand.
On December 8, 2025, we effected the Reverse Split. Concurrently with the Reverse Split, we effected a corresponding change in the ratio of ordinary shares represented by each of our ADSs, such that the ratio changed from one ADS representing 275 ordinary shares to one ADS representing one ordinary share. Concurrently, we effected the Mandatory Exchange, and our ordinary shares, which had been approved for listing and trading on the Nasdaq Capital Market, commenced trading at the market open on December 8, 2025.
B. Business Overview
Overview
We are a provider of software and cybersecurity solutions and hardware products that we design, develop and manufacture and that are embedded into small-sized drones or small-sized unmanned aerial vehicles, or SUAVs, and into robotic systems, or robotics. We hold both patented technology and unique know-how. We are aiming to further develop our global customer base by increasing our number of design wins and targeted pilot projects and ultimately cross-sell our other solutions to those same customers in order to become a leading end-to-end provider to SUAV and robotics systems original equipment manufacturers, or OEMs, who, in turn, sell their systems into the security and surveillance, process industry (processing of bulk resources into other products), infrastructure inspection, first responders, homeland security, government and defense market segments. By “design win” we are referring to the large-scale and adoption of our products by our OEM customers on an-ongoing basis. The “pilot projects” refer to initial small-scale sales and implementation. An “end-to-end” provider is one that provides all of the key components its customers need for their products.
25
We aim to penetrate and expand in the commercial segment of our markets by leveraging the experience we have gained in the defense segment of our markets. We believe that our key competitive advantages are our ability to provide a near end-to-end solution to our customers, which enables us to have an insider’s view of our customers’ needs as well as our holistic cybersecurity approach and highly secured offering, and outstanding performance in harsh environments. This is evidenced by our recent design wins and pilot projects, such as production scale orders of our data links from one of the largest U.S.-based drone manufacturers for its cybersecure drone platform and production scale orders our data links, mesh networking and ground control station solutions from Asia-based leading robotics manufacturer for its robotics platforms sold to military and industrial markets and top-tier defense and commercial manufacturers mainly from United States, Europe and Israel. We further believe our products have performed well in harsh environmental conditions. Our solutions have been deployed by our various customers worldwide, including in the United States, Europe, Israel and other Asian countries. Historically we have generated most of our revenues from sales of our hardware products and have recently commenced marketing and initial sales of our cloud-based software and cybersecurity solutions.
26
Smart Robust Technology Solutions
SUAVs and robotic platforms are built from hundreds of products, yet only a few key critical technology products and solutions make the drone or robot “smart”, and capable of performing its mission. We design, develop and deliver the “smart” robust solution part of the drone system to our customers. These “smart” robust solutions include cybersecurity, cloud management software, communication datalink and mobile mesh networking terminals, handheld control terminals and professional services and support. We offer these solutions as “off-the-shelf” or they can be tailored for a specific customer.
Market Opportunity
SUAVs, which weigh under 150 kilograms, have rapidly evolved from a military origin to have commercial and civil government applications. Some of the leading factors for the recent upsurge in SUAV usage are (a) increased automation of SUAVs providing additional value to existing workflows, (b) an overall easing of regulatory restrictions, and (c) recent advances in technology that have enabled the use of SUAVs in small-scale, localized environments, whether by police or defense forces in open areas or in urban neighborhoods or for commercial applications such as surveying, aerial remote sensing, monitoring, mapping, precision agriculture, and product distribution. According to the Small Unmanned Aerial Vehicles (SUAVs) Industry Report 2024, published in December 2024, or the SUAVs Industry Report, the SUAV drone market is set to grow at a 12.4% compound annual growth rate, and is expected to reach $27.1 billion by 2030.
In addition to the SUAV market, we operate at the intersection of two other large and rapidly growing markets. According to a report by Global Market Insights, the global drone cybersecurity market was valued at approximately $2.2 billion in 2023 and is projected to reach approximately $11 billion by 2032, growing at a CAGR of over 19%. The software segment accounted for over 44% of that market in 2023, and military and defense applications represented over 35% of the market. According to a report by Future Market Insights, the global cybersecurity in robotics market is projected to grow from approximately $4.7 billion in 2025 to approximately $14.3 billion by 2035, at a CAGR of 11.7%. We believe our products — which span cybersecurity software, hardware and cloud management for drones and robotic systems — position us to serve all three of these markets.
We do not seek to profit from conflict. We expect the current situation in the Ukraine and in the Middle East to accelerate demand for our products. In late February 2022, Russia launched a large-scale military attack on Ukraine. The war includes reliance by both sides on drone warfare, including the use of small-sized drones by ground forces either for intelligence, surveillance and reconnaissance, or ISR, or loitering, drones which are also known as Kamikaze drones. These drones are used to find, track, and kill or damage targets with strikes beyond the front lines.
27
In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets including launch of extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in thousands of deaths and injuries, and Hamas additionally kidnapped many Israeli civilians and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against Hamas and other terrorist organizations in parallel to their continued rocket and terror attacks. This military campaign includes usage of small-sized drones for loitering and attack (kamikaze) as well as intelligence, surveillance and reconnaissance, or ISR.
These conflicts have likely impacted on our business, and we have seen a rise in orders from new customers and increased orders from current customers that in turn resulted in increased revenues. In these conflicts, we are also seeing cyber-attacks which target drones and other platforms, rendering them ineffective. Therefore, we witness and expect continued increased interest from our customers and potential customers in the need for cybersecurity products to protect drone platforms, communications channels, data transmissions and weapons carried on the small drones. We expect to continue to sell to OEM customers mainly located in Israel, the U.S. and Western Europe that are leaders in the supply of small drones for ISR and loitering missions.
Our Products and Services
As per ResearchGate’s conclusion, SUAVs may have nine key smart components solutions, which are ground control systems, cybersecurity, cloud management software, datalink/networking hardware, flight missions, safety systems, flight computers, GPU/Edge computing processes, and payloads. We aim to provide our customers, who are SUAV and robotic systems OEMs, an end-to-end suite of smart solutions and services that include cybersecurity, cloud management software, datalink and networking, ground control systems and professional and support services. Our product portfolio is completely designed and developed in-house and based on our extensive know-how and experience gained over a decade. This enables us to design and develop every component of our solutions and technology while constantly adjusting to the ever-changing needs and challenges in the SUAVs and robotics industry. Each of our products is designed to allow utmost flexibility and scalability. Our current customers include eight (8) Tier-1 leading manufacturers of SUAVs. We currently have over 50 customers in 18 countries. Our partners and customers include Israel Aerospace Industries, Airbus, Teledyne-Flir, Rafael Technologies, ST Engineering, the Israeli Ministry of Defense, or MOD, U.S. Defense Industry and more.
28
OS3 Platform
OS3 Platform, or OS3, is a comprehensive software solution designed to deliver Operational Security, Safety and Standards compliance for the commercial and defense uncrewed drones and robotics industry. Designed to operate on NVIDIA AI computing for drones and robotics, OS3 Edge fortifies each autonomous vehicle mission locally on the system itself, while OS3 Cloud remotely monitors and protects the entire fleet’s operations. OS3 monitors, identifies and remotely responds to deliver immediate and complete control across the entire fleet by addressing three main pillars of performance:
| ● | security risk mitigation by detecting hostile external threats; |
| ● | safety of operations related to internal software, hardware, and maintenance issues including risk mitigation; and |
| ● | standards compliance ensuring platform adherence to regulatory standards. |
By ensuring operational efficiencies, OS3 has the ability to secure customers’ top and bottom-line performance in diverse operations from robots moving inventory in commercial warehouses to drones used in critical defense operations, thus creating value for the entire uncrewed ecosystem.
In June 2025, we entered into a cooperation agreement with Palladyne AI Corp. to jointly offer Palladyne’s embodied neuro-symbolic artificial intelligence software bundled with the OS3, enhancing autonomous capabilities and cybersecurity performance for mission-critical customers in both defense and commercial markets.
ICE Cybersecurity
The ICE Cybersecurity Suite is our automated software designed to provide a “holistic” solution to prevent, detect, and respond in real-time to one or more cyber-attacks. Its ability to provide several multilayered tiers of protection (including protecting the small drone platform itself, safeguarding its communication channels, and encrypting data received and shared during operations) is what we believe to be our key competitive advantage in our ability to provide a leading cybersecurity solution in the markets that we serve. To date, the ICE Cybersecurity Suite has started initial sales and delivery to the Israeli MOD for current surveillance and intelligence needs.
CONTROLiT Cloud Management Software
CONTROLiT is our cloud-based network management software solution for operators of SUAVs. We believe that our key competitive advantage over other management solutions is the ability to consolidate all relevant data into a single powerful software platform, thereby improving the configuration and real-time management and monitoring of devices, networks and operations, such as real-time flight logs and live mapping of operational devices and networks.
SkyHopper Datalinks
Our SkyHopper datalink family of products provides bi-directional data links that supports multiple transmission modes. Because of its communication capabilities through line of sight, or LOS, non-line of sight, or N-LOS, and urban areas we believe that the SkyHopper is uniquely positioned to provide high-end performance at a smaller size, lighter weight, and at a more attractive price point than our competitors. The SkyHopper datalinks provide superior communication in harsh environments through LOS, N-LOS and in urban areas, where it provides a robust, resilient and secured communication. The SkyHopper datalink family of products includes our, SkyHopper PRO, SkyHopper PRO lite, SkyHopper PRO micro, and SkyHopper Multiband (newly released in 2026).
Mobile Mesh Networking
Our Mobile Mesh Communication Unit, or MCU, family of products connects and acts as a relay to, and between, all units within the network. The MCU enables each unit to provide redundancy communication to all of the other units in its range such that a failure in one unit will not affect the operation of other units within the network. The Mesh networking enables fleet and swarm drones and robotics operation which is the cost-effective way to operate drones in the coming future. The mesh networking is strengthening our market position as a provider of superior connectivity performance in harsh conditions in the SUAV market. Configurations of the MCU can also be changed according to mesh network topology and surroundings. The MCU networking family includes the MCU-30 lite, MCU-30 Rugged and MCU-200 designed for mid-sized and long-ranged drone market.
29
Mobile Controller Systems
Our all-in-one ground control systems are responsible for controlling and transmitting video and data from the SUAV to the ground control system (controller systems).
We provide a wide range of handheld ruggedized controllers with multiple functionalities designed to support drone and robotics operation with variety of payloads. The controllers are compact, unified and rugged to operate with either an internal or external datalink unit, offer battery charging, an advanced tablet feature HD low-latency viewer and are designed to operate with a variety of payloads. The Mobile Controller System product portfolio includes: 7’’ mini-Controller PRO, 10’’ Maxi-Controller PRO, 10’’ Extremer, 10’’ Touch-P,10’’ and Touch-G and 8” Controller.
Professional Services and Support
We provide integrated logistic support, or ILS, services for SUAVs such as ILS operation, logistics, maintenance, and safety. Our services are available either onsite at the customer’s location or available remotely.
Key Growth Strategies
Key components of our growth strategy include the following:
| (1) | Achieving greater market penetration through increasing the number of our design wins and pilot projects. This is a crucial element of our strategy because they help deepen our working relationship with a customer, understand their overall needs and, in turn, allow us to better cross-sell other products and solutions. Most importantly, we have a stronger base from which to build additional revenue once our design win, which is built into our customers’ products, is certified by local regulators and marketed onwards to their customers, all with the expectation of increasing both the volume and value of customer orders. Finally, our customers continue to act as important references for future potential customers. |
| (2) | Achieving greater market exposure to potential customers in the markets that we serve. We are currently a leader in the Israeli market for the products we sell and are thoroughly expanding our marketing and sales activities in the U.S., Europe and several Asian countries, including increasing our in-house sales force, sponsoring trade shows, conferences, webinars and other online marketing campaigns. Our goal is to ensure that we are aware of every potential bidding process and request for proposal that exists in the markets that we serve. |
| (3) | In our aim to become an end-to-end solutions provider, we plan to either acquire or form strategic partnerships with other drone-related solutions and components manufacturers, service providers, or re-sellers that service our markets and who can complement our product offering. |
| (4) | Our research and development efforts are at the foundation of our Company and we intend to continue investing in our own innovations in order to pioneer new and enhanced products and solutions that enable us to satisfy the ever-evolving needs of the markets we serve with a focus on identifying opportunities where we can develop technology that can be sold in a SaaS software model. |
Supply
We purchase electronics component kits required in the manufacturing of our hardware products through authorized dealers who, in turn, buy them from component manufacturers. We are not reliant on any one authorized dealer or single source supplier such that we have alternative sources of supply if a specific component is “out of stock” or has a long lead-time to delivery.
30
Manufacturing and Assembly
We outsource the manufacturing of our products to third parties who receive our design plans together with the relevant electronic component kits which we purchase from our suppliers. Thereafter, we assemble the finished product in-house or through outsourced contractors. We are responsible for quality control.
We consistently monitor our inventory levels, our outsourced manufacturing and distribution capabilities, and maintain recovery plans to address potential disruptions that we may encounter. We have leveraged our manufacturing capabilities through subcontracting arrangement with a third-party manufacturer in the Asia-Pacific region and USA, in addition to the manufacturing managed in the Israeli company site. This subcontracting arrangement expands our manufacturing capabilities and is intended to enable us to deliver larger quantities of products upon demand and in a timely manner, on schedule, thus allowing for more consistent product delivery, by enabling us to utilize the manufacturer’s manpower and production equipment. We do not have a written agreement with this manufacturer and work with them on a statement-of-work and purchase order basis. We have trained the manufacturer to produce our materials and provide it with technical materials and support.
In the future, as we scale up our sales and production further, we may implement a turnkey operation with select manufacturers for our products. We may enter into agreements with our contractors. Pursuant to such agreements, the contractors will provide the components and/or perform the assembly of such components and/or service in accordance with specific terms of the mutually agreed work instructions and purchase orders. The agreements define the responsibilities of each party and the regulatory and compliance requirements that apply and contain industry-standard terms and guidelines.
Competition
The smart solutions market for SUAVs and robotics is characterized by intense competition, rapid change and constant innovation.
We believe that we face three different types of competition:
| ● | Companies, who, like us, seek to become an end-to-end provider of technology components and systems to the SUAV and robotics market. We consider UXV Technologies to be a key competitor in this segment. |
| ● | Companies that only provide, and thus only compete with us in, one portion of our product offering. We consider such competitors to include SkyGrid (in cybersecurity), Elsight Limited, MicroHard Systems, Inc. and Auterion AG (in cloud networking management software), UXV Technologies, Kuta, CTI Ltd. and Tomahawk Robotics (in mobile handheld controllers), Silvus Technologies, Inc., Domo Tactical Communications, Inc., Comtact Systems, CreoMegic LTD, DoodleLab and Persistent Systems (in datalinks and networking). |
| ● | Our customers’ in-house capabilities that compete with our offerings. We consider AeroVironment, Inc., Rafael Advanced Defense Systems, Ltd., Israel Aerospace Industries and Elbit Systems, Ltd to have such in-house capabilities. |
Key Strengths
We believe the following key attributes and capabilities provide us with long-term competitive advantages:
End-to-end smart solutions provider – We continue to develop our end-to-end smart solutions offerings in order to better serve the SUAV and robotics market:
| ● | Bundle together our solutions to organically provide better system performance, shorter time to market and cost-effective pricing for our customers. |
| ● | Enables us to cross-sell other smart solutions to our customers as part of their next design projects. |
31
| ● | Deeper customer relationships with SUAV manufacturers give us an insider’s view of current and future solutions requirements. |
| ● | Expand our contribution of software revenue thereby improving our overall margins. |
In Use and “Field Proven” by the Israel Ministry of Defense – Our solutions have been chosen by large well-known Israeli defense contractors including Elbit Systems, Ltd., Rafael Advanced Defense Systems and Israeli Aerospace Industries, Ltd. in design wins where our systems and solutions are embedded into their SUAVs and are currently in use “in the field” by the Israeli Ministry of Defense.
Design win with Top Tier SUAV Manufacturers – Recent design wins and pilot projects where our systems and solutions are embedded into SUAVs manufacturers across the U.S., Europe and Israel and are currently in use “in the field” and have performed well in harsh environmental conditions. These important customer references form the building blocks of future customer wins.
Certified and Validated Solutions – We have obtained multiple permits,certifications and recognitions, such as the latest selection of products from our communication datalink family to enter the short list of the Blue UAS Framework under the Division of Innovation of the U.S. Department of Defense, for our products and solutions for both the commercial and defense markets that we serve.
Proprietary technologies, in-house capabilities and industry experience – We believe our decade of experience in providing solutions to the drone industry; in-house advanced research and development expertise across different fields and team members; our deep portfolio of innovative core proprietary technologies, intellectual property and know-how; our internal manufacturing, assembly and testing capabilities, together with international manufacturing capabilities based on subcontractors; all serve as high barrier of entry to our competitors and provide us with important competitive advantage.
Seasoned Leadership Team with Deep Industry Expertise and Proven Track Record of Innovation
Our management and leadership team has proven track record in research and development of innovative solutions in our field; establishing international marketing and sales infrastructure as well as leading business ramp-up with top-tier companies and manufacturers in the targeted markets; operation and manufacturing expertise to scale up production across the world to meet raising demands; comprehensive and holistic safety, security and cyber development and business implementation; as well as financing of high-tech private and public companies. Our seasoned leadership and board of directors are well equipped to support the company’s planned growth and ramp-up as we will reach the tipping point of our business.
Intellectual Property
We strive to protect the proprietary technology that we believe is important to our business, including seeking and maintaining intellectual property know-how intended to cover our methods of use and processes for their manufacture and any other inventions that are commercially important to the development of our business. We also rely on trade secrets to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection.
Our approach to intellectual property has been to adopt a strategy of trade secrecy in relation to our know-how and software systems. We have, however, also applied, and been granted two patents in the US and may, in the future, file for additional patents in other jurisdictions or in respect of other aspects of our technology. The granted patents are related to our mesh networking modem technology. Our granted U.S. patents hold 34 claims that were approved and granted.
32
The key technology aspects covered by those patents are:
| ● | The 2013 patent relates to the method through which our modem technology can coordinate disparate signals and reassemble those signals into a more efficient and useable communication, a process described as ‘joint beam formation and synchronization’. |
| ● | The 2020 patent encompasses intellectual property that is part of the algorithm for the networking layer of our mobile mesh technology. |
| Filing Date | Status | Issue Date | Application No. | Patent No. | No.
of Claims |
Country/ Jurisdiction |
Owner/ Applicant |
Title | ||||||||
| 2008-12-30 | Granted | 2013-07-02 | 12/810,844 | US8477874B2 | 16 | U.S. | Mobilicom Ltd | Method, device and system of wireless communication | ||||||||
| 2016-11-28 | Granted | 2020-02-25 | 15/779,541 | US10575339B2 | 18 | U.S. | Mobilicom Ltd | Scalable Mobile Ad Hoc Networks |
Despite the patent strategy described above, we are largely reliant on know-how and trade-secrets which are not the subject of formal intellectual property registration. We have implemented various protective measures in connection with our strategy of trade secrecy in respect of our know-how and software systems. These measures include limiting knowledge and access to key aspects of our know-how and software systems to key management personnel, ensuring employees are engaged on terms that include provisions relating to confidentiality and postemployment restraints and the execution of nondisclosure and intellectual property ownership agreements with third-party contractors.
There can be no guarantee that the current, or any future, patent application will be granted or that third parties will not seek to claim an interest in the intellectual property. Nor can we be sure that any of our existing patents or any patents that may be granted to us in the future will be commercially useful in protecting our technology. There is also a risk that measures in place to protect our know-how and trade-secrets may not be adequate to protect against third parties obtaining the intellectual property (or parts of it) which may adversely affect our business.
Regulation
The FCC in the US, ETSI in Europe and Telec in Japan are the key regulatory organization worldwide which are responsible for establishing, managing, and developing safety and operation standards and regulations for electronics equipment usage in commercial market. Our products have a number of existing certifications, including FCC, ETSI, Telec and other safety and environmental certifications relating to shock, vibration and temperature ranges which are anticipated to provide us with a basis from which to meet the regulatory and certification requirements for our target markets. In some cases, explicit authorization from the US or Israeli government may be needed to export our products. We have received ITAR and CJ certifications to allow exports from the US, and, when exporting to certain countries from Israel, DECA regulations may apply, even though to date the DECA has determined that these regulations do not apply to our currently sold products. We cannot provide assurance that such export authorizations will be available in the future for our existing and newly developed products.
In the event we make sales to defense and other mission critical markets, the products may be required to pass certain testing or certifications including, radiofrequency emission, environmental conditions (IP67, low/high temperature, shocks, vibrations, etc.), as required in each individual instance. Additionally, we have obtained a license issued by Israel’s Ministry of Communication that is required for us to act as a radiofrequency communication equipment developer in Israel.
We are also subject to the provisions of the Research Law, which may restrict our ability to move the production of products or sell the intellectual property or know-how developed using grants received from the IIA (see “Item 3.D — Risk Factors — Risks Related to Israeli Law and our Operations in Israel — We received Israeli government grants from IIA for certain of our research and development activities, the terms of which may require us to pay royalties and to satisfy specified conditions in order to manufacture products and transfer technologies outside of Israel. If we fail to satisfy these conditions, we may be required to pay penalties and refund grants previously received” for further information).
33
Employees
We currently employ 29 full time and 9 part-time employees across Israel, the United States, and Australia. In addition, we retain third-party contractors and consultants.
Legal Proceedings
We are not party to any material legal proceedings.
C. Organizational Structure
We currently have two subsidiaries: Mobilicom Ltd, an Israeli company, and Mobilicom Inc., a Delaware corporation.
D. Property, Plant and Equipment
We do not own any real estate. Our registered office in Australia is located at Level 21, 459 Collins Street, Melbourne, VIC, Australia, 3000, for which we pay a nominal fee. Our operational headquarters in Israel are located at 1 Rakefet Street, Shoham, Israel 6083705.
We lease approximately 620 square meters of office premises in Shoham, Israel pursuant to an extended lease after utilizing two consecutive options each to renew the lease for additional 24 months, that expires in January 2028.We also hold an option to renew the lease for an additional lease period of 24 months, subject to a four-month advance notice.
Our monthly lease and facility management fees are approximately $20,359, based on December 31, 2025, exchange currency rates, as published by the Bank of Israel.
We believe our leased business locations are sufficient to meet our current needs.
ITEM 4A. UNRESOLVED STAFF COMMENTS
Not applicable.
34
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included elsewhere in this annual report. The discussion below contains forward-looking statements that are based upon our current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to inaccurate assumptions and known or unknown risks and uncertainties, including those identified in “Cautionary Note Regarding Forward-Looking Statements” and under “Risk Factors” elsewhere in this annual report. Our discussion and analysis for the year ended December 31, 2024 can be found in Item 5. “Operating and Financial Review and Prospects” of our Annual Report on Form 20-F for the fiscal year ended December 31, 2024, filed with the SEC on March 27, 2025.
Overview
We are a provider of software and cybersecurity solutions and hardware products that we design, develop and manufacture and that are embedded into small-sized drones or small-sized unmanned aerial vehicles, or SUAVs, and into robotic systems, or robotics. We hold both patented technology and unique know-how. We are aiming to further develop our global customer base by increasing our number of design wins and targeted pilot projects and ultimately cross-sell our other solutions to those same customers in order to become a leading end-to-end provider to SUAV and robotics systems original equipment manufacturers, or OEMs, who, in turn, sell their systems into the security and surveillance, process industry (processing of bulk resources into other products), infrastructure inspection, first responders, homeland security, government and defense market segments. By “design win” we are referring to the large-scale and adoption of our products by our OEM customers on an-ongoing basis. The “pilot projects” refer to initial small-scale sales and implementation. An “end-to-end” provider is one that provides all of the key components its customers need for their products.
We aim to penetrate the commercial segment of our markets by leveraging the experience we have gained in the defense segment of our markets. We believe that our key competitive advantages are our ability to provide a near end-to-end solution to our customers, which enables us to have an insider’s view of our customers’ needs as well as our holistic cybersecurity approach and highly secured offering, and outstanding performance in harsh environments. This is evidenced by our recent design wins and pilot projects, and top-tier defense and commercial manufacturers from United States, Europe and Israel. We further believe our products have performed well in harsh environmental conditions. Our solutions have been deployed by our various customers worldwide, including in the United States, Europe, Israel and other Asian countries.
For more information regarding our business and operations, see “Item 4.B. Business Overview” above.
A. Operating Results
Comparison of the years ended December 31, 2025 and 2024
Revenue and Other income
| For the twelve months ended December 31, | ||||||||||||
| Revenue | 2025 | 2024 | Increase/Decrease | |||||||||
| Revenue | $ | 3,363,538 | $ | 3,180,565 | $ | 182,973 | ||||||
| Other income: | ||||||||||||
| Government grants from IIA | 228,910 | 187,718 | 41,192 | |||||||||
| Interest income | 264,132 | 269,771 | (5,639 | ) | ||||||||
| Foreign exchange gains | - | 203,593 | (203,593 | ) | ||||||||
| Total Revenue and Other income | $ | 3,856,580 | $ | 3,841,647 | $ | 14,933 | ||||||
35
Revenue
Revenues for the year ended December 31, 2025, were $3,363,538, compared to $3,180,565 for the year ended December 31, 2024, an increase of $182,973, or 6%. The increase was mainly due to increased orders primarily for defense purposes, including scaled production by few of our Tier-1 customers.
Government grants from IIA
Grants received under IIA research and development supported programs for the year ended December 31, 2025, were $228,910, compared to $187,718 for the year ended December 31, 2024, an increase of $41,192, or 22%.
Interest income
Interest income from short-term bank deposits, for the year ended December 31, 2025, was $264,132, compared to $269,771 for the year ended December 31, 2024, a decrease of $5,639, or 2%. The decrease was mainly due to decreased intertest rates for invested funds under interest bearing bank deposits.
Foreign Exchange gains
Foreign exchange gains were $nil for the year ended December 31, 2025, compared to $203,593 for the year ended December 31, 2024, a decrease of $203,593, or 100%. Foreign exchange gains are mainly due to the effect of changes in currency exchange rates between the US$, NIS and the AUD$.
Cost of Goods Sold and Gross Profit
| For the twelve months ended December 31, | ||||||||||||
| 2025 | 2024 | Increase/Decrease | ||||||||||
| Revenue | $ | 3,363,538 | $ | 3,180,565 | $ | 182,973 | ||||||
| Cost of Goods Sold | (1,575,057 | ) | (1,348,711 | ) | (226,346 | ) | ||||||
| Gross Profit | $ | 1,788,481 | $ | 1,831,854 | $ | (43,373 | ) | |||||
Cost of goods sold remained at the same pace as the increase in revenue. Gross margin for the year ended December 31, 2025, was 53%, compared to 58% for the year ended December 31, 2024. The gross margins relate to our products being high-end IP based technology (beyond the hardware value) and continued effective planning and monitoring for components acquisitions. The cost of goods sold increase was mainly due to workforce optimization to support the expected grow in manufacturing and deliveries to support our Tier 1 scaled production needs.
36
Expenses
| For the twelve months ended December 31, | ||||||||||||
| 2025 | 2024 | Increase/Decrease | ||||||||||
| Expenses: | ||||||||||||
| Sales and Marketing | $ | 3,327,496 | $ | 1,965,426 | $ | 1,362,070 | ||||||
| Research and Development | 4,897,030 | 2,127,409 | 2,769,621 | |||||||||
| General and Administrative | 3,884,231 | 1,970,849 | 1,913,382 | |||||||||
| Finance costs | 9,296 | 27,052 | (17,756 | ) | ||||||||
| Foreign exchange losses | 919,784 | - | 919,784 | |||||||||
| Loss from fair value changes for exercised warrants | 6,219,517 | 896,902 | 5,322,615 | |||||||||
| Fair value losses from financial liability | 6,823,879 | 3,354,854 | 3,469,025 | |||||||||
| Total expenses | $ | 26,081,233 | $ | 10,342,492 | $ | 15,738,741 | ||||||
Sales and Marketing expenses.
Sales and marketing expenses were $3,327,496 for the year ended December 31, 2025, compared to $1,965,426 for the year ended December 31, 2024, an increase of $1,362,070, or 69%. The increase was primarily due to costs related to employees’ stock-based compensation.
Research and Development expenses.
Research and development expenses were $4,897,030 for the year ended December 31, 2025, compared to $2,127,409 for the year ended December 31, 2024, an increase of $2,769,621, or 130%. The increase was primarily due to costs related to employees’ stock-based compensation and investment in development of additional enhanced datalinks products to support growing market needs.
General and Administrative expenses.
General and administrative expenses were $3,884,231 for the year ended December 31, 2025, compared to $1,970,849 for the year ended December 31, 2024, an increase of $1,913,382, or 97%. The increase was primarily due to costs related to employees’ stock-based compensation, increase in Nasdaq related costs due to transition from ADS to share listing, and increase in investors relation activities.
Financial costs.
Financial costs were $9,296 for the year ended December 31, 2025, compared to $27,052 for the year ended December 31, 2024, a decrease of $17,756, or 66%. Financial costs are primarily related to interest paid under our lease agreements.
Foreign Exchange losses
Foreign exchange losses were $919,784 for the year ended December 31, 2025, compared to $nil for the year ended December 31, 2024, an increase of $919,784, or 100%. Foreign exchange losses are mainly due to the effect of changes in currency exchange rates between the US$, NIS and the AUD$.
Loss from fair value changes for exercised warrants
Loss from fair value changes for exercised warrants were $6,219,517 for the year ended December 31, 2025, compared to $896,902 for the year ended December 31, 2024, an increase of $5,322,615, or 594%. Loss from fair value changes for exercised warrants are attributed to revaluation gain/(loss) changes between exercise dates and measured periods related with exercise of warrants issued under our initial public offering in the United States in August 2022 and under our registered direct offering in the United States in January 2024 (a non-cash item).
Fair value losses from financial liability
Fair value losses from financial liability were $6,823,879 for the year ended December 31, 2025, compared to $3,354,854 for the year ended December 31, 2024, an increase of $3,469,025, or 103%. Fair value losses from financial liability are attributed to revaluation gain/(loss) between measured periods related with warrants issued under our initial public offering in the United States in August 2022 and under our registered direct offering in the United States in January 2024 (a non-cash item).
37
B. Liquidity and Capital Resources
As of December 31, 2025, we have not achieved positive cash flow from operations and incurred a net loss of $23.7 million for the period ended December 31, 2025, and generated $54.1 million of accumulated losses since inception.
Our operations have been funded substantially through issuances of our equity securities in public and private offerings, including our initial public offering in August 2022 on Nasdaq, our registered direct offering in January 2024 on Nasdaq, our at-the-market facility that we established in February 2025, public offerings on the Australian Securities Exchange, or ASX, and sales of our products.
As of December 31, 2025, we had cash and cash equivalents of $19.0 million. Additionally, we also recognized a total of $348,050 as receivables. We estimate that we have adequate financial resources for at least 12 months from December 31, 2025, based on our current cash and receivables balances and our ongoing operations. The consolidated financial statements have been prepared on the assumption that we will continue as a going concern, meaning we will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations.
In addition, our operating plans may change as a result of many factors that may currently be unknown to us, and we may need to seek additional funds in the future. Our future capital requirements will depend on many factors, including:
| ● | the progress and costs of our research and development activities; |
| ● | the costs of manufacturing our products; |
| ● | the costs of filing, prosecuting, enforcing and defending patent claims and other intellectual property rights; |
| ● | the costs of our expanding sales and marketing activities, as well as the potential costs of contracting with third parties to provide marketing and distribution services for us or for building such capacities internally; and |
| ● | the magnitude of our general and administrative expenses. |
Until we can generate significant recurring revenues, profit and cash flow provided by operating activity we expect to satisfy future cash needs through debt or equity financing as well as governmental grants. In the event that we require additional financing, we may not be able to raise such financing on terms acceptable to us or at all. If we are unable to raise additional capital or generate cash flows necessary to expand our operations and invest in continued innovation, we may not be able to compete successfully, which would harm our business, results of operations, and financial condition.
Cash Flows
| For the twelve months ended December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| Net cash used in operating activities | $ | (1,903,508 | ) | $ | (3,206,549 | ) | $ | (4,162,587 | ) | |||
| Net cash used in investing activities | (36,607 | ) | (26,926 | ) | (12,760 | ) | ||||||
| Net cash provided by/(used in) financing activities | 12,366,058 | 3,475,156 | (271,616 | ) | ||||||||
| (Decrease) Increase in cash and cash equivalents and restricted cash | 10,425,943 | 241,681 | (4,446,963 | ) | ||||||||
| Cash and cash equivalents and restricted cash, at the beginning of the year | 8,686,390 | 8,444,709 | 12,891,672 | |||||||||
| Cash and cash equivalents and restricted cash, at the end of the year | 19,112,333 | 8,686,390 | 8,444,709 | |||||||||
38
Net cash used in operating activities
For the years ended December 31, 2025 and 2024, net cash used in operating activities was $1,903,508 and $3,206,549, respectively. The decrease between the periods is primarily due to an increase in receipts from customers of $965,651 and decrease in payments to suppliers.
For the years ended December 31, 2024 and 2023, net cash used in operating activities was $3,206,549 and $4,162,587, respectively. The decrease between the periods is primarily due to an increase in receipts from customers of $1,424,409, net by increase in payments to suppliers of $423,316 mainly related to increased manufacturing and production costs related to increased sales, increased research and development activities related to the release of new products and additional features and enhancements to current products and continued sales and marketing activities mainly in the United States to support the sales and marketing of our cybersecurity and cloud-based products.
Net cash used in investing activities
For the years ended December 31, 2025 and 2024, the net cash used in investing activities was $36,607 and $26,926, respectively.
For the years ended December 31, 2024 and 2023, the net cash used in investing activities was $26,926 and $12,760, respectively.
Net cash provided by financing activities
For the year ended December 31, 2025 net cash provided by financing activities was $12,366,058 compared to net cash provided by financing activities of $3,475,156 for the year ended December 31, 2024. For the year ended December 31, 2025, net cash provided by financing activities was mostly attributed to proceed from exercise of warrants related with warrants issued under our initial public offering in the United States in August 2022 and under our registered direct offering in the United States in January 2024, and net proceeds from issuance of shares under at-the-market sales. For the year ended December 31, 2024, net cash provided by financing activities was mostly attributed to net proceeds from issuances of shares and exercises of warrants from the January 2024 registered direct offering.
For the year ended December 31, 2024 net cash provided by financing activities was $3,475,156 compared to net cash used in financing activities of $271,616 for the year ended December 31, 2023. For the year ended December 31, 2024, net cash provided by financing activities was mostly attributed to net proceeds from issuances of shares and exercises of warrants from the January 2024 registered direct offering. For the year ended December 31, 2023, net cash used in financing activities was mostly attributed to repayment of our lease liabilities.
39
Commitments and Contractual Obligations
Our material contractual obligations as of December 31, 2025 which are not reflected as liabilities in the Consolidated Balance Sheets include operating lease obligations related with our facilities and for motor vehicles, of $ 545,419, and net employee benefits related with severance pay and retirement obligations of $234,133.
Other than the foregoing commitments, legal contingencies incurred in the normal course of business and employment contracts for key employees, we do not have any off-balance sheet financing arrangements or liabilities. We do not have any majority-owned subsidiaries or any interests in or relationships with any variable-interest entities that are not included in our consolidated financial statements.
Recent Offering
In February 2025, we entered into an At-The-Market Sales Agreement, or the Sales Agreement, as amended on October 29, 2025, with ThinkEquity LLC, as sales agent, or ThinkEquity, pursuant to which we may offer and sell, from time to time through ThinkEquity our ordinary shares having an aggregate offering price of up to $37.0 million. We will pay ThinkEquity a fixed commission rate in cash equal to 3.0% of the aggregate gross proceeds from each sale of the ordinary shares sold pursuant to the Sales Agreement. As of the date hereof, we sold 1,842,560 ordinary shares pursuant to the Sales Agreement for aggregate gross proceeds of approximately $10.0 million.
C. Research and development, patents and licenses, etc.
For a description of our research and development programs and the amounts that we have incurred over the last two years pursuant to those programs, please see “Item 5. Operating and Financial Review and Prospects— A. Operating Results— Operating Expenses— Research and Development Expenses, net” and “Item 5. Operating and Financial Review and Prospects— A. Operating Results— Comparison of the year ended December 31, 2025 to the year ended December 31, 2024— Research and Development Expenses.”
D. Trend Information
We continue to closely monitor macro-economic conditions, including the headwinds caused by supply chain problems, inflation, increased interest rates, geopolitical events, military conflicts and other trends that have been adversely impacting economic activity. We have been assessing, on an ongoing basis, the implications of those global conditions for our operations, supply chain, liquidity, cash flow and product orders, and will act in an effort to mitigate adverse consequences as needed. To the extent inflation increases our costs and expenses, we could consider price increases to offset those cost pressures. Other than as disclosed elsewhere in this annual report, we are not currently aware of any trends, uncertainties, demands, commitments or events for the period from January 1, 2025 to the present time that are reasonably likely to have a material adverse effect on our net revenue, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial condition.
40
E. Critical Accounting Judgements, Estimates and Assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue, and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results.
The critical judgments and significant estimates in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements are:
Share-based payments
We have a share-based remuneration scheme for employees. The fair value of share options is estimated by using the Black-Scholes option pricing model, on the date of grant based on certain assumptions. Those assumptions are described in the share-based payments note and include, among others, the dividend growth rate, expected share price volatility and expected life of the options. The fair value of the equity settled options granted is charged to statement of comprehensive income over the vesting period of each tranche and the credit is taken to equity, based on our estimate of shares that will eventually vest.
Governmental liabilities on grants received
The Company measures the value of its governmental liabilities on grants received, each period, based on discounted cash flows derived from the Company’s future anticipated revenues.
Lease term
The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement is exercised in determining whether there is reasonable certainty that an option to extend the lease or purchase the underlying asset will be exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods to be included in the lease term. In determining the lease term, all facts and circumstances that create an economical incentive to exercise an extension option, or not to exercise a termination option, are considered at the lease commencement date. Factors considered may include the importance of the asset to the Company’s operations; comparison of terms and conditions to prevailing market rates; incurrence of significant penalties; existence of significant leasehold improvements; and the costs and disruption to replace the asset. The Company reassesses whether it is reasonably certain to exercise an extension option, or not exercise a termination option, if there is a significant event or significant change in circumstances.
Financial Liability
The Company measures the value of the investors warrants and representative warrants, or Warrants, issued under our August 2022 initial public offering. The fair value of the Warrants is estimated by using the Hull-White option pricing model (trinomial Lattice model), on the date of the issuance or grant and remeasured at end of each reporting period (December 31, 2025 and 2024) using certain assumptions. These assumptions include, among others, the dividend growth rate, expected share price, volatility and expected life of the warrants, early exercise / exercise multiple, capital structure effects and trinomial steps.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A. Directors and Senior Management
The following table sets forth information covering our current directors and executive officers.
| Name | Age | Position | ||
| Oren Elkayam | 52 | Chairman and Chief Executive Officer | ||
| Yossi Segal | 52 | Vice President, Research and Development and Director | ||
| Liad Gelfer | 52 | Director of Finance of Mobilicom Ltd.; Chief Accounting Officer | ||
| Guy Givoni(1) | 54 | Director | ||
| Jacqueline Bloom(1) | 49 | Director | ||
| Liat Caner (1) | 54 | Director |
(1) Independent director (as defined under Nasdaq Stock Market Listing Rules)
41
Oren Elkayam, serves as our Chairman and as Chief Executive Officer. Mr. Elkayam is a tech executive, founder, and public company CEO who has led growth and innovation at tech companies from inception through cashflow-positive commercialization. Having raised over $100 million in venture and public company investments, Mr. Elkayam has led IPOs, developed breakthrough cybersecurity and wireless communications, established international sales and marketing channels, sold products and solutions to top-tier companies, and built high-performing corporate organizations from the ground up. Mr. Elkayam has served on the boards of several venture-backed firms. Mr. Elkayam has been instrumental in building Mobilicom’s product portfolio and global Tier-1 customer base while guiding the establishment of industry standards and regulatory policy for drones. Prior to starting Mobilicom, Mr. Elkayam was CEO of Sortech, a nano-powder materials technology company which he led from incubation to fully commercialized products and strategic deals with the top tier companies in its field. As VP of Business Development of Runcom, a fabless silicon company that develops and sells solutions for the broadband mobile communications industry, Oren initiated and negotiated contracts with top carrier companies such as Alcatel-Lucent, Nortel, KDDI, Mitsubishi, and Motorola, as well as leading investment rounds with international venture capital funds. Mr. Elkayam served as an Officer in the Israeli Air Force, led an elite R&D unit for large cutting-edge technology projects, and was involved with the Israel Space Agency. He holds a B.Sc in Electrical Engineering and an MBA (magna cum laude) from Ben-Gurion University, Israel.
Yossi Segal, serves as our Vice President of Research and Development and as a member of our board of directors. Mr. Segal is also a co-founder of Mobilicom Ltd. Before joining us in December of 2006, Mr. Segal was the Chief Technology Officer and a founding member of Runcom Ltd. from August 2000 to August 2006. Mr. Segal is a worldwide expert in OFDM/A and has written essential patents for OFDM/A technology, being the first to implement OFDM/A in a working product. He has also previously led the design and development groups of three mobile integrated circuits (IC chip) and eight wireless broadband systems which are currently in operation and sold worldwide. Mr. Segal has taken a leading role in several international wireless standards (IEEE and ETSI) as a committee voting member, and served in the Israeli Army as an officer in an elite electronic warfare research and development unit. Mr. Segal holds a Bachelor of Science degree (magna cum laude) and Master of Science degree in Electrical Engineering and a Master of Business Administration degree all from Ben-Gurion University, Israel.
Liad Gelfer, serves as the Director of Finance of Mobilicom Ltd. since July 2021. Mr. Gelfer brings vast experience and background in various emerging and publicly-traded companies. He has extensive knowledge in financial reporting, financial modelling and forecasting, mergers and acquisitions and initial public offering procedures and internal controls. From January 2020 to June 2021, Mr. Gelfer served as the Chief Financial Officer of Schindler. From January 2018 to December 2019, he was the Chief Financial Officer at Safend. From June 2009 to December 2017, Mr. Gelfer was the Senior Corporate Controller at Compugen Ltd. a dual listed (TASE and Nasdaq: CGEN) biotech company. He also served as Director of Finance of Supercom (NASADQ: SPCB) a hi-tech company. Mr. Gelfer holds a bachelor’s degrees in Business Management and Accounting, and a Master of Business Administration degree in Accounting and Finance, both from the College of Management Academic Studies.
42
Guy Givoni, serves as a member of our board of directors since March 2025. Mr. Givoni is a global business leader and senior executive who has over two decades of experience building and scaling technology companies in the Cybersecurity, AI, UAVs, telecom, B2B software and AgTech industries and has led go-to-market strategies and scaling cybersecurity solutions across global markets. Mr. Givoni also mentors entrepreneurs through accelerator programs combining his business acumen with a passion for science and innovation. Mr. Givoni previously served as the chief executive officer and a director of SupPlant Ltd. in Australia., a leading AI-driven plant monitoring solutions to enhance agricultural productivity, from 2022 to 2024 and as the co-founder and chief executive officer of SecureStack, a cybersecurity software solutions company for multi-cloud environments, from 2019 to 2021. Mr. Givoni previously held other senior and leadership roles at AlgoSec Inc., a SaaS security policy management company for the enterprise market, in APAC from 2010 to 2019. Mr. Givoni holds a B.Sc. in Mathematics and Computer Science from the Hebrew University of Jerusalem and an MBA in Finance from Reichman University, a joint program with the Wharton School at the University of Pennsylvania.
Jacqueline Bloom, serves as a member of our board of directors since June 2025. Ms. Bloom has served as a strategic advisor, investor, and board director across high-growth ventures and impact-driven organizations for over 30 years, bringing deep experience in commercializing technology, scaling operations, and structuring investments to accelerate innovation and sustainable growth across early-stage companies. Since 2025, Ms. Bloom has been employed as a Performance Implementation Partner at Backable, a strategic advisory firm focused on unlocking and scaling organizational performance. Previously, from 2022 to 2024, Ms. Bloom served as Growth & Investment Director at Startupbootcamp Australia, a global accelerator and venture fund, where she led the creation of a $5 million international fund, managed investor engagement across five countries, and oversaw governance, due diligence, and impact reporting across a portfolio of early-stage technology ventures. From 2021 through 2022, Ms. Bloom serves as the CEO & Partner of Shepreneur, a founder-focused platform that achieved a 75% funding success rate for women-led startups. Prior to this, from 2018 to 2021, Ms. Bloom led The Helping Hub, held senior roles in construction and retail, and scaled a family business into a multi-million dollar entity. Ms. Bloom previously served as a member of the Board of Directors and Chair of the Fundraising and Strategy Committee for Left Write Hook from 2024 to 2025, and currently serves as an Independent Investment Committee Member for Swinburne University and Breakthrough Victoria’s University Innovation Platform, assessing spinouts and early-stage venture opportunities aligned with commercial and societal impact. Ms. Bloom holds a Bachelor of Business Management and Postgraduate Diploma in Marketing from Monash University, and has completed executive programs in venture capital (VC Catalyst – Wade Institute of Entrepreneurship) and angel investing (Airtree Explorer). She also holds Australian RG146 certification in managed investments.
Liat Caner, serves as a member of our board of directors since September 2025. Ms. Caner has served as a financial leader across public companies, venture- backed companies and startup companies for over 20 years, bringing deep experience in business strategy and planning, merger and acquisition and corporate finance. Since 2022, Ms. Caner has been employed as Chief Financial Officer at InfinityLabs R&D, a leading research and development company equipping the next generation to lead worldwide high-tech industry, where she leads corporate finance and legal. Previously, from 2017 to 2021, Mrs. Caner served as Chief Financial Officer at Bactochem, Lab path, CT-LAB, a Chemovil group member, leader in creating synergy in modern laboratory testing, where she led corporate finance and managed large accountants, economics and bookkeeping. Mrs. Caner previously served as a member of the Board of Directors for Bactochem, Lb Path and CT-LAB. Mrs. Caner holds a bachelor’s in accounting and economics from Tel Aviv University, and master’s in international law and legal services from Bar Ilan University. Mrs. Caner is a Certified Public Accountant (Israel).
43
Family Relationships
There are currently no family relationships between any members of our executive management and our directors.
B. Compensation
Principles used to determine the nature and amount of remuneration
The objective of our reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. Our board of directors ensures that executive reward satisfies the following key criteria for good reward governance practices:
| ● | Competitiveness and reasonableness |
| ● | Acceptability to shareholders |
| ● | Performance linkage / alignment of executive compensation |
| ● | Transparency |
The board of directors is responsible for determining and reviewing remuneration arrangements for its directors and executives. The performance of the company depends on the quality of its directors and executives. The remuneration philosophy is to attract, motivate and retain high performance and high-quality personnel.
The reward framework is designed to align executive reward to shareholders’ interests. The board of directors has considered that it should seek to enhance shareholders’ interests by:
| ● | having economic profit as a core component of plan design |
| ● | focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value |
| ● | attracting and retaining high caliber executives |
Additionally, the reward framework should seek to enhance executives’ interests by:
| ● | rewarding capability and experience |
| ● | reflecting competitive reward for contribution to growth in shareholder wealth |
| ● | providing a clear structure for earning rewards |
In accordance with best practice corporate governance, the structure of non-executive director and executive director remuneration is separate.
44
Non-executive directors remuneration
Fees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive directors’ fees and payments are reviewed annually by the board of directors. The board of directors may, from time to time, receive advice from independent remuneration consultants to ensure non-executive directors’ fees and payments are appropriate and in line with the market.
On October 19, 2023, we voluntarily delisted our ordinary shares from the ASX and our ordinary shares (then ADSs) began trading exclusively on the Nasdaq on October 19, 2023. Our constitution (similar to articles of association) require that the aggregate maximum non-executive directors’ remuneration be determined by the Company in a general meeting. The most recent determination by shareholders in 2017 set the maximum annual aggregate collective remuneration of all non-executive directors of AUD$250,000.
Executive remuneration
We aim to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components.
The executive remuneration and reward framework has five components:
| ● | base pay and non-monetary benefits; |
| ● | short-term performance incentives; |
| ● | share-based payments; and |
| ● | other remuneration such as Israel social benefits, U.S. 401K plan and long service leave. |
The combination of these comprises the executive’s total remuneration.
Fixed remuneration, consisting of base salary, Israel social benefits, U.S. 401K plan, superannuation and non-monetary benefits, are reviewed annually by the board of directors based on individual and business unit performance, our overall performance and comparable market remunerations.
Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle benefits) where it does not create any additional costs to us and provides additional value to the executive.
The short-term incentives, or STI program is designed to align the targets of the business units with the performance hurdles of executives. STI payments are granted to executives based on specific annual targets and key performance indicators, or KPI’s being achieved. KPI’s include profit contribution, customer satisfaction, leadership contribution and product management.
The long-term incentives include long service leave and share-based payments. Shares may be awarded to executives over a period of three years based on long-term incentive measures. These include increase in shareholders’ value relative to the entire market and the increase compared to our direct competitors.
45
Details of Remuneration for fiscal year 2025
The following table presents in the aggregate all compensation we paid to all of our directors and senior management as a group for the year ended December 31, 2025. The table does not include any amounts we paid to reimburse any of such persons for costs incurred in providing us with services during this period.
All amounts reported in the tables below reflect the cost to us, in thousands of Australian dollars, for the year ended December 31, 2025.
| Salary, bonuses and Related Benefits | Pension, Retirement and Other Similar Benefits | Share Based Compensation | Total | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| All directors and senior management as a group, consisting of 6 persons as of December 31, 2025 (1)(2)(3)(4)(5)(6)(7)(8)(9)(10) | 827,143 | 126,630 | 5,367,828 | 6,321,601 | ||||||||||||
| (1) | 14,908 options exercisable to ordinary shares, were granted on August 3, 2023, at an exercise price of $1.44, vesting over 3 years. |
| (2) | 90,000 options exercisable to ordinary shares, were granted on December 1, 2025, at an exercise price of $5.9, vesting over 3 years. |
| (3) | On May 31, 2023, Mr. Elkayam was granted 397,727 options exercisable to ordinary shares, at an exercise price of $1.43, vesting over 3 years. |
| (4) | On June 26, 2025, Mr. Elkayam was granted 452,154 restricted share units, vesting over four installments till end of 2025. |
| (5) | On December 1, 2025, Mr. Elkayam was granted 1,080,000 options exercisable to ordinary shares, at an exercise price of $5.9, vesting over 18 months starting January 1, 2026. |
| (6) | On May 31, 2023, Mr. Segal was granted 198,863 options exercisable to ordinary shares, at an exercise price of $1.43, vesting over 3 years |
| (7) | On June 26, 2025, Mr. Segal was granted 452,154 restricted share units, fully vested on August 31, 2025. |
| (8) | On December 1, 2025, Mr. Segal was granted 720,000 restricted share units, vesting over 18 months starting January 1, 2026. |
| (9) | On February 15, 2025, Mr. Gelfer was granted 30,000 restricted share units, vesting over 3 years. |
| (10) | On December 1, 2025, Mr. Gelfer was granted 20,000 restricted share units, vesting over 3 years starting August 1, 2027. |
C. Board Practices
Board of Directors
Our board of directors currently consists of five members.
Directors may be elected at each annual general meeting of our shareholders and, subject to any express contractual terms which may apply to executive Directors, serve until they retire or are removed by a majority vote of shareholders. In addition, our Constitution require that the number nearest to but not more than one-third of the directors (excluding the CEO) must retire at each annual general meeting – directors who retire in this manner are eligible for re-election at the same annual general meeting. We believe that each of our directors has relevant industry experience. The membership of our board of directors is directed by the following requirements:
| ● | our Constitution specifies that the number of directors must not be lower than that required by Australian law (being three directors) and not greater than twelve Directors and our board of directors may determine the number of directors within those limits; |
| ● | as set forth in our Board Charter, it is recommended that the membership of the board of directors should consist of a majority of independent directors who satisfy the independence criteria guidelines recommended by the ASX Corporate Governance Principles and Recommendations 4th Edition; and |
| ● | our board of directors should, collectively, have the appropriate level of personal qualities, skills, experience, and time commitment to properly fulfill its responsibilities or have ready access to such skills where they are not available. |
46
Our board of directors has delegated responsibility for the conduct of our businesses to the Chief Executive Officer, but remains responsible for overseeing the performance of management. Our board of directors has established delegated limits of authority, which define the matters that are delegated to management and those that require board of directors’ approval. Under the Corporations Act, at least two of our directors must be resident Australians.
Committees
To assist our board of directors with the effective discharge of its duties, we have established a Remuneration and Nomination Committee and an Audit and Risk Committee, which committees operate under a specific charter approved by our board of directors.
Remuneration and Nomination Committee
The members of our Remuneration and Nomination Committee are Guy Givoni, Jacqueline Bloom and Liat Caner. Mr. Givoni acts as chairman of the committee.
The committee’s role involves:
| ● | identifying, evaluating and recommending qualified nominees to serve on our board of directors; |
| ● | evaluating, adopting and administering our compensation plans and similar programs advisable for us, as well as modifying or terminating existing plans and programs; |
| ● | establishing policies with respect to equity compensation arrangements; and |
| ● | overseeing, reviewing and reporting on various remuneration matters to our board of directors. |
Audit and Risk Committee
We established an Audit and Risk Committee, whose members consists of Guy Givoni, Jacqueline Bloom and Liat Caner. The members of the committee meet the criteria for independence of audit committee members set forth in Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the applicable rules of Nasdaq. Each member of our audit committee meets the financial literacy requirements of the listing standards of Nasdaq. The principal duties and responsibilities of our audit committee will include, among other things:
| ● | overseeing and reporting on various auditing and accounting matters to our board of directors, including the selection of our independent accountants, the scope of our annual audits, fees to be paid to the independent accountants, the performance of our independent accountants and our accounting practices; |
| ● | overseeing and reporting on various risk management matters to our board of directors; |
| ● | considering and approving or disapproving all related-party transactions; |
| ● | reviewing our annual and semi-annual financial statements and reports and discussing the statements and reports with our independent registered public accounting firm and management; |
| ● | reviewing and pre-approving the engagement of our independent registered public accounting firm to perform audit services and any permissible non-audit services; |
| ● | evaluating the performance of our independent registered public accounting firm and deciding whether to retain their services; and |
| ● | establishing procedures for the receipt, retention and treatment of complaints received by us regarding financial controls, accounting or auditing matters. |
47
Code of Conduct
We have established a Corporate Governance Statement, which includes a code of conduct. Our Corporate Governance Statement sets out the standards of behavior that apply to every aspect of our dealings and relationships, both within and outside Mobilicom. The following standards of behavior apply to all directors, executive officers and employees of Mobilicom:
| ● | comply with all laws that govern us and our operations; |
| ● | act honestly and with integrity and fairness in all dealings with others and each other; |
| ● | avoid or manage conflicts of interest; |
| ● | use our assets responsibly and in the best interests of Mobilicom; and |
| ● | be responsible and accountable for our actions. |
The Code of Conduct is available on our website at https://ir.mobilicom.com/.
D. Employees.
See “Item 4.B. Business Overview—Employees.”
E. Share Ownership.
See “Item 7.A. Major Shareholders” below.
Employee Security Incentive Plan
Our employee security incentive plan, or the Plan, was adopted on December 6, 2024. Under the rules of the Plan, our board of directors may offer securities to eligible persons. A summary of the Plan is set out below and is qualified in its entirety by reference to the full text of the Plan, a copy of which is filed as Exhibit 4.7 to this annual report.
Eligible Persons
Means: (a) a person (or prospective person) who is an employee or director of, or an individual who provides services to, us or an associated entity of us; or (b) a person who is eligible to participate under Annexure A (Israeli taxpayers) or Annexure B (US taxpayers) of the plan; or (c) a person or entity who has been determined by our board of directors to be eligible to participate in the plan from time to time.
Securities
Means a share, an option to acquire a share, a performance right to acquire share or an other interest to acquire a share, each as issued in accordance with the Plan, or the Securities.
Purpose
The Plan is intended to provide mechanisms through which we can incentivize Eligible Persons.
Plan Administration
The Plan shall be administered by our board of directors who shall have power to:
| (i) | determine appropriate procedures for administration of the Plan consistent with the terms and conditions of the Plan; |
| (ii) | amend or modify the Plan; |
48
| (iii) | resolve conclusively all questions of fact or interpretation arising in connection with the Plan; |
| (iv) | adopt rules subordinate to the Plan that allow for, amongst other matters, the participation or residents outside Australia in the Plan. | |
| (v) | delegate to any one or more persons for such period and on such conditions as it may determine the exercise of any of the directors’ powers or discretions arising under the Plan. |
Eligibility
Eligible Persons entitled to participate in the Plan shall be determined by the directors in their absolute discretion taking into account a person’s skills, experience, length of service, remuneration level and such other criteria as the directors consider appropriate in the circumstance.
Offer and Application
An application to be issued Securities under the Plan may be made by Eligible Persons invited to participate in the Plan using the acceptance form which will accompany the invitation to participate in the Plan.
The invitation to an Eligible Person to participate in the Plan will include (but may not be limited to):
| (i) | whether the Securities issued may incorporate performance related factors (including, but not limited to, as vesting conditions); |
| (ii) | the number of Securities to be issued to an Eligible Person under the Plan; |
| (iii) | the exercise or issue price of the securities (if any); and |
| (iv) | if the Securities have an expiry date, the periods during which the Securities may be exercised or will vest or are otherwise convertible into shares. |
Securities not Transferrable
Except as otherwise set out in the invitation to apply for Securities under the Plan, may not be transferred or assigned.
Acquisition Price
Except as otherwise set out in the invitation to apply for Securities under the Plan, Securities will be issued free of charge to Eligible Persons.
Maximum Number of Securities
The total number of Securities that can be issued pursuant to the Plan is:
| (i) | where the Securities are offered under the Australian ESS Regime contained in Division 1A of the Australian Corporations Act, the number which is 20% of the number of shares then on issue or such other greater amount as may be specified in our Constitution from time to time; |
| (ii) | where the Securities are offered in Australia, and not under the ESS Regime contained in Division 1A of the Australian Corporations Act, such number of Securities as approved by our board of directors subject to any applicable laws; or |
49
| (iii) | where the Securities are offered outside Australia pursuant to Annexure A (Israeli taxpayers) or Annexure B (US taxpayers) such number of Securities as are approved by our board of directors and permitted by those annexures. |
Subject to compliance with the ’20% issue limit’ set out in section 1100V(2)(b)(ii) of the Corporations Act, Securities may be offered under the Plan without the issue of a disclosure document in accordance with Chapter 6D of the Corporations Act. The Company may also issue Securities (whether under this Plan or otherwise) without the issue of a disclosure document in reliance on other exceptions to the disclosure requirement of the Corporations Act 2001 (Cth) including issued that did not need disclosure to investors because of section 708 of the Corporations Act.
Lapse of Securities
Unless the directors in their absolute discretion determine otherwise, Securities shall in accordance with the terms of issue of those Securities as set out in the invitation to an Eligible Person to apply for and receive Securities pursuant to the Plan (including its Annexures).
Rights Attaching to Shares
Shares issued pursuant to the Plan, or upon the exercise of options or the conversion of convertible Securities issued under the Plan will in all respects, including bonus issues and new issues, rank equally and carry the same rights and entitlements as other shares on issue.
Capital Event/Change of Control
Notwithstanding the Terms and Conditions, upon the occurrence of a Trigger Event (as defined below) the directors may determine:
| (i) | that the options may be exercised , or that conditions or restrictions which apply to performance rights, shares or other interests may be waived and released at any time from the date of such determination, and in any number until the date determined by the directors acting bona fide so as to permit the holder to participate in any change of control arising from a Trigger Event provided that the directors will forthwith advise in writing each holder of such determination; or |
| (ii) | to use their reasonable endeavors to procure that an offer is made to holders of options, performance rights, shares or other interests on like terms (having regard to the nature and value of those interests) to the terms proposed under the Trigger Event in which case the directors shall determine an appropriate period during which the holder may elect to accept the offer and, if the holder has not so elected at the end of that period, the options, or rights to performance rights, shares or other interests shall immediately become exercisable and if not exercised within the time period specific by the Directors, shall lapse and or be bought-back and cancelled (subject to compliance with applicable laws). |
Trigger Event means:
| (i) | the approval of resolutions by shareholders for a scheme of arrangement between the Company and its creditors or members or any class thereof pursuant to section 411 of the Corporations Act; |
| (ii) | a bidder’s statement issued under the Corporations Act becoming unconditional; |
| (iii) | the date upon which a person or a group of associated persons becomes entitled to sufficient shares to give it or them the ability, in general meeting to replace all, or allow a majority, of directors in circumstances where such ability was not already held by a person associated with such person or group of associated persons; |
| (iv) | any agreement for the sale of all or substantially all of the Company’s assets becoming unconditional; or |
| (v) | the occurrence of any event of circumstance which is analogous to the above or has the effect, once completed, of a change in control of the Company or ownership of all or substantially all of its asset. |
50
No Quotation of Securities
Other than shares issued under the Plan, other Securities will not be quoted on Nasdaq. However, application will be made to Nasdaq for official quotation of the shares issued on the exercise of the options or the conversion of other convertible Securities.
Assessed fair value of options granted to Eligible Persons at their grant date is allocated equally over the period from grant date to vesting date, and the amount for the 2025 financial year is included in the remuneration table as set out above. Fair values at grant date are determined using the Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the option. The expected price volatility is based on the historic volatility (based on the remaining life of the options), adjusted for any expected changes to future volatility due to publicly available information.
As of March 22, 2026, we have issued 1,582,726 options under the Plan to employees (including directors and/or their nominee(s)) and consultants of the Company at a weighted average exercise price of $5.08, of which 289,166 options were vested as of such date. We have also issued an aggregate of 1,794,308 restricted share units, or RSUs, to employees (including directors and/or their nominee(s)) and consultants of the Company, of which 1,067,641 RSU were vested as of such date.
All options and/or RSUs granted under the Plan are deemed to be granted for no consideration.
F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation
There was no erroneously awarded compensation that was required to be recovered pursuant to the Mobilicom Limited Executive Officer Clawback Policy during the fiscal year ended December 31, 2025.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
A. Major Shareholders
The following table and accompanying footnotes present certain information regarding the beneficial ownership of our ordinary shares based on 12,633,371 ordinary shares outstanding as of March 22, 2026 by:
| ● | each person known by us to be the beneficial owner of more than 5% of our ordinary shares; |
| ● | each of our directors and executive officers individually; and |
| ● | all of our directors and executive officers as a group. |
Beneficial ownership is determined according to the rules of the SEC and generally means that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power of that security, including options that are exercisable within 60 days of March 22, 2026, and/or RSUs that are releasable from restriction within 60 days of March 22, 2026. Information with respect to beneficial ownership has been furnished to us by each director, executive officer, or 5% or more shareholder, as the case may be. Ordinary shares subject to options currently exercisable or exercisable within 60 days of March 22, 2026, and/or RSUs currently releasable or releasable within 60 days of March 22, 2026 are deemed to be outstanding for computing the percentage ownership of the person holding these options and/or RSUs and the percentage ownership of any group of which the holder is a member, but are not deemed outstanding for computing the percentage of any other person.
51
Unless otherwise indicated, to our knowledge each shareholder possesses sole voting and investment power over the ordinary shares listed subject to community property laws, where applicable. None of our shareholders have different voting rights from other shareholders. Unless otherwise indicated, the address for each of the persons listed in the table below is Level 21, 459 Collins Street, Melbourne, VIC, Australia, 3000.
| Number of Shares Beneficially Owned | Percentage Owned | |||||||
| Holders of more than 5% of our voting securities: | ||||||||
| Directors and senior management who are not 5% holders: | ||||||||
| Oren Elkayam | 339,421 | 2.6 | % | |||||
| Yossi Segal | 599,635 | 4.7 | % | |||||
| Liat Caner | 5,000 | * | ||||||
| Jacqueline Bloom | 7,500 | * | ||||||
| Guy Givoni | 11,454 | * | ||||||
| Liad Gelfer | 22,120 | * | ||||||
| All directors and senior management as a group (6 persons) (1) | 985,130 | 7.6% | % | |||||
| * | Represents beneficial ownership of less than 1% of our outstanding ordinary shares. |
| (1) | Includes (i) a total of 687,522 ordinary shares held by directors and senior management, (ii) a total of 10,000 RSUs that are vested within 60 days after March 22, 2026 and (ii) a total of 287,608 shares subject to options that are beneficially owned by directors and senior management that are exercisable within 60 days after March 22, 2026, with a weighted average exercise price of $5.70 per share and which expire between July 2026 and June 2033. |
Record Holders
Based upon a review of the information provided to us by our previous registrar in Australia, as of March 22, 2026, there were a total of 253 holders of record of our ordinary shares, of which 214 record holders had registered addresses in Australia and 20 record holders had registered addresses in the United States. Certain of these ordinary shares were held by brokers or other nominees. As a result, the number of holders of record or registered holders in the United States is not representative of the number of beneficial holders or of the residence of beneficial holders.
We are not controlled by another corporation, by any foreign government or by any natural or legal persons except as set forth herein, and there are no arrangements known to us which would result in a change in control of us at a subsequent date.
Changes in Percentage Ownership by Major Shareholders
To our knowledge, other than as disclosed in the table above, our other filings with the SEC and this Annual Report, there has been no significant change in the percentage ownership held by any major shareholder since January 1, 2023.
B. Related Party Transactions
Other than transactions related to compensation of our executive officers and directors as described under “Compensation” and “Employment Agreements with Executive Officers” sections above, we have not entered into any related party transaction.
Pursuant to our Constitution and deed of indemnity, insurance and access agreements, we have agreed to indemnify directors to the full extent permitted by law, and to maintain director and office insurance for our officers and directors. policy as expressed in the Securities Act and is therefore unenforceable.
C. Interests of Experts and Counsel
Not applicable.
52
ITEM 8. FINANCIAL INFORMATION.
A. Statements and Other Financial Information.
See “Item 18. Financial Statements.”
Legal Proceedings
See “Item 4.B. Business Overview—Legal Proceedings.”
Dividends
We have not declared or paid any dividends on our ordinary shares, and we do not anticipate paying any dividends in the foreseeable future. Our board of directors presently intends to reinvest all earnings in the continued development and operation of our business.
Payment of dividends in the future, if any, will be at the discretion of our board of directors. If our board of directors elects to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial conditions, contractual restrictions and other factors that our board of directors may deem relevant.
B. Significant Changes
Other than as otherwise described in this Annual Report on Form 20-F and as set forth below, no significant change has occurred in our operations since the date of our financial statements included in this Annual Report on Form 20-F.
ITEM 9. THE OFFER AND LISTING
A. Offer and Listing Details
On August 25, 2022, our ordinary shares (then ADSs) and warrants commenced trading on the Nasdaq Capital Market under the symbol “MOB,” and “MOBBW,” respectively. The Company commenced trading on the ASX on May 2, 2017.
On October 19, 2023, our ordinary shares ceased to be traded on the ASX. Our ordinary shares (then ADSs) and warrants continue to be traded, now exclusively, on the Nasdaq Capital Market under the symbol “MOB,” and “MOBBW,” respectively.
On December 8, 2025, we effected the Reverse Split. Concurrently with the Reverse Split, we effected a corresponding change in the ratio of ordinary shares represented by each of our ADSs, such that the ratio changed from one ADS representing 275 ordinary shares to one ADS representing one ordinary share. Concurrently, we effected the Mandatory Exchange, and our ordinary shares, which had been approved for listing and trading on the Nasdaq Capital Market, commenced trading at the market open on December 8, 2025.
B. Plan of Distribution
Not applicable.
C. Markets
Our ordinary shares and warrants trade exclusively on the Nasdaq Capital Market under the symbol “MOB,” and “MOBBW,” respectively.
D. Selling Shareholders
Not applicable.
E. Dilution
Not applicable.
F. Expenses of the Issue
Not applicable.
53
10. ADDITIONAL INFORMATION
A. Share Capital
Not applicable.
B. Articles of Association
A copy of our Constitution is attached as Exhibit 1.1 to this Annual Report on Form 20-F. Other than as disclosed below, the information called for by this Item is set forth in Exhibit 2.1 to this Annual Report on Form 20-F and is incorporated by reference into this Annual Report on Form 20-F.
C. Material Contracts
We have not entered into any material contracts other than in the ordinary course of business and other than those described in Item 4. “Information on Our Company,” Item 7B “Major Shareholders and Related Party Transactions - Related Party Transactions” or elsewhere in this Annual Report on Form 20-F.
The share and per share numbers in the following discussion reflect (i) a 1-for-275 reverse share split that we effected on December 8, 2025 and (ii) the mandatory cancellation of our ADS program and the exchange of ADSs for ordinary shares at a one-for-one ratio effected on December 8, 2025.
D. Exchange Controls
There are currently no Israeli currency control restrictions on remittances of dividends on our ordinary shares, proceeds from the sale of the shares or interest or other payments to non-residents of Israel, except for shareholders who are subjects of countries that are, or have been, in a state of war with Israel.
E. Taxation.
The following description is not intended to constitute a complete analysis of all tax consequences relating to the acquisition, ownership and disposition of our ordinary shares. You should consult your own tax advisor concerning the tax consequences of your particular situation, as well as any tax consequences that may arise under the laws of any state, local, foreign, or other taxing jurisdiction.
The following is a summary of material U.S. federal and Australian income tax considerations to U.S. holders, as defined below, of the acquisition, ownership and disposition of ordinary shares and warrants. This discussion is based on the laws in force as of the date of this Annual Report on Form 20-F, and is subject to changes in the relevant income tax law, including changes that could have retroactive effect. The following summary does not take into account or discuss the tax laws of any country or other taxing jurisdiction other than the United States and Australia. Holders are advised to consult their tax advisors concerning the overall tax consequences of the acquisition, ownership and disposition of ordinary shares and warrants in their particular circumstances. This discussion is not intended, and should not be construed, as legal or professional tax advice.
This summary does not address the effects of U.S. federal estate and gift tax laws, the alternative minimum tax, or any state and local tax considerations within the United States, and is not a comprehensive description of all U.S. federal or Australian income tax considerations that may be relevant to a decision to acquire or dispose of ordinary shares or warrants. Furthermore, this summary does not address U.S. federal or Australian income tax considerations relevant to holders subject to taxing jurisdictions other than, or in addition to, the United States and Australia, and does not address all possible categories of holders, some of which may be subject to special tax rules.
Certain Material U.S. Federal Income Tax Considerations
Subject to the limitations described in the next two paragraphs, the following discussion summarizes certain material U.S. federal income tax consequences to a “U.S. Holder” arising from the purchase, ownership and sale of our ordinary shares. For this purpose, a “U.S. Holder” is a holder of our ordinary shares that is: (1) an individual citizen or resident of the United States, including an alien individual who is a lawful permanent resident of the United States or meets the substantial presence residency test under U.S. federal income tax laws; (2) a corporation (or entity treated as a corporation for U.S. federal income tax purposes) created or organized under the laws of the United States or the District of Columbia or any political subdivision thereof; (3) an estate, the income of which is includable in gross income for U.S. federal income tax purposes regardless of its source; (4) a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have authority to control all substantial decisions of the trust; or (5) a trust that has a valid election in effect to be treated as a U.S. person to the extent provided in U.S. Treasury regulations.
54
This summary does not purport to be a comprehensive description of all of the U.S. federal income tax considerations that may be relevant to a decision to purchase our ordinary shares. This summary generally considers only U.S. Holders that will own our ordinary shares as capital assets. Except to the limited extent discussed below, this summary does not consider the U.S. federal tax consequences to a person that is not a U.S. Holder, nor does it describe the rules applicable to determine a taxpayer’s status as a U.S. Holder. This summary is based on the provisions of the Internal Revenue Code of 1986, as amended, or the Code, final, temporary and proposed U.S. Treasury regulations promulgated thereunder, administrative and judicial interpretations thereof, and the Convention between the Government of the United States of America and the Government of Australia for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, as amended (the “Treaty”), all as in effect as of the date hereof and all of which are subject to change, possibly on a retroactive basis, and all of which are open to differing interpretations. We will not seek a ruling from the Internal Revenue Service, or the IRS, with regard to the U.S. federal income tax treatment of an investment in our ordinary shares by U.S. Holders and, therefore, can provide no assurances that the IRS will agree with the conclusions set forth below.
This discussion does not address all of the aspects of U.S. federal income taxation that may be relevant to a particular U.S. Holder based on such holder’s particular circumstances and in particular does not discuss any estate, gift, generation-skipping transfer, state, local, excise or foreign tax considerations. In addition, this discussion does not address the U.S. federal income tax treatment of a U.S. Holder who is: (1) a bank, life insurance company, regulated investment company, or other financial institution or “financial services entity;” (2) a broker or dealer in securities or foreign currency; (3) a person who acquired our ordinary shares in connection with employment or other performance of services; (4) a U.S. Holder that is subject to the U.S. alternative minimum tax; (5) a U.S. Holder that holds our ordinary shares as a hedge or as part of a hedging, straddle, conversion or constructive sale transaction or other risk-reduction transaction for U.S. federal income tax purposes; (6) a tax-exempt entity; (7) real estate investment trusts or grantor trusts; (8) a U.S. Holder that expatriates out of the United States or a former long-term resident of the United States; or (9) a person having a functional currency other than the U.S. dollar. This discussion does not address the U.S. federal income tax treatment of a U.S. Holder that owns, directly or constructively, at any time, ordinary shares or representing 10% or more of the stock of our Company. Additionally, the U.S. federal income tax treatment of partnerships (or other pass-through entities) or persons who hold ordinary shares through a partnership or other pass-through entity are not addressed.
EACH PROSPECTIVE INVESTOR IS ADVISED TO CONSULT HIS OR HER OWN TAX ADVISER FOR THE SPECIFIC TAX CONSEQUENCES TO THAT INVESTOR OF PURCHASING, HOLDING OR DISPOSING OF OUR ORDINARY SHARES, INCLUDING THE EFFECTS OF APPLICABLE STATE, LOCAL, FOREIGN OR OTHER TAX LAWS AND POSSIBLE CHANGES IN THE TAX LAWS.
Taxation of Dividends Paid on Ordinary Shares
We do not intend to pay dividends in the foreseeable future. In the event that we do pay dividends, and subject to the discussion under the heading “Passive Foreign Investment Companies” below and the discussion of “qualified dividend income” below, a U.S. Holder, other than certain U.S. Holders that are U.S. corporations, will be required to include in gross income as ordinary income the amount of any distribution paid on the ordinary shares (including the amount of any tax withheld on the date of the distribution), to the extent that such distribution does not exceed our current and accumulated earnings and profits, as determined for U.S. federal income tax purposes. The amount of a distribution which exceeds our earnings and profits will be treated first as a non-taxable return of capital, reducing the U.S. Holder’s tax basis for the ordinary shares to the extent thereof, and then capital gain. We do not expect to maintain calculations of our earnings and profits under U.S. federal income tax principles and, therefore, U.S. Holders should expect that the entire amount of any distribution generally will be reported as dividend income.
55
In general, preferential tax rates for “qualified dividend income” and long-term capital gains are applicable for U.S. Holders that are individuals, estates or trusts. For this purpose, “qualified dividend income” means, inter alia, dividends received from a “qualified foreign corporation.” A “qualified foreign corporation” is a corporation that is entitled to the benefits of a comprehensive tax treaty with the United States which includes an exchange of information program. The IRS has stated that the Treaty satisfies this requirement and we believe we are eligible for the benefits of the Treaty.
In addition, our dividends will be qualified dividend income if our ordinary shares are readily tradable on Nasdaq or another established securities market in the United States. Dividends will not qualify for the preferential rate if we are treated, in the year the dividend is paid or in the prior year, as a PFIC, as described below under “—Passive Foreign Investment Companies.” A U.S. Holder will not be entitled to the preferential rate: (1) if the U.S. Holder has not held our ordinary shares for at least 61 days of the 121 day period beginning on the date which is 60 days before the ex-dividend date, or (2) to the extent the U.S. Holder is under an obligation to make related payments with respect to positions in substantially similar or related property. Any days during which the U.S. Holder has diminished its risk of loss on our ordinary shares are not counted towards meeting the 61-day holding period. Finally, U.S. Holders who elect to treat the dividend income as “investment income” pursuant to Section 163(d)(4) of the Code will not be eligible for the preferential rate of taxation.
The amount of a distribution with respect to our ordinary shares will be measured by the amount of the fair market value of any property distributed, and for U.S. federal income tax purposes, the amount of any Australian taxes withheld therefrom. Cash distributions paid by us in Australian dollars will be included in the income of U.S. Holders at a U.S. dollar amount based upon the spot rate of exchange in effect on the date the dividend is includible in the income of the U.S. Holder, and U.S. Holders will have a tax basis in such Australian dollars for U.S. federal income tax purposes equal to such U.S. dollar value. If the U.S. Holder subsequently converts the Australian dollars into U.S. dollars or otherwise disposes of them, any subsequent gain or loss in respect of such Australian dollars arising from exchange rate fluctuations will be U.S. source ordinary income or loss.
Subject to certain significant conditions and limitations, including potential limitations under the Treaty, U.S. Holders may be entitled to a credit against their U.S. federal income tax liability or a deduction against U.S. federal taxable income in an amount equal to the non-refundable Australian tax withheld on distributions on our ordinary shares. The election to deduct, rather than credit, foreign taxes, is made on a year-by-year basis and applies to all foreign taxes paid by a U.S. Holder or withheld from a U.S. Holder that year. Distributions paid on our ordinary shares will generally be treated as passive income that is foreign source for U.S. foreign tax credit purposes. As a result of recent changes to the U.S. foreign tax credit rules, a withholding tax may need to satisfy certain additional requirements in order to be considered a creditable tax for a U.S. Holder. We have not determined whether these requirements have been met and, accordingly, no assurance can be given that any withholding tax on dividends paid by us will be creditable. U.S. Holders should consult their own tax advisors to determine whether and to what extent they would be entitled to such credit.
Taxation of the Sale, Exchange or other Disposition of Ordinary Shares
Except as provided under the PFIC rules described below under “—Passive Foreign Investment Companies,” upon the sale, exchange or other disposition of our ordinary shares, a U.S. Holder will recognize capital gain or loss in an amount equal to the difference between such U.S. Holder’s tax basis for the ordinary shares, determined in U.S. dollars, and the U.S. dollar value of the amount realized on the disposition (or its U.S. dollar equivalent determined by reference to the spot rate of exchange on the date of disposition, if the amount realized is denominated in a foreign currency). The gain or loss realized on the sale, exchange or other disposition of ordinary shares will be long-term capital gain or loss if the U.S. Holder has a holding period of more than one year at the time of the disposition. For foreign tax credit limitation purposes, gain or loss recognized upon a disposition generally will be treated as from sources within the United States. However, in limited circumstances, the Treaty can re-source U.S. source income as Australian source income. Individuals who recognize long-term capital gains may be taxed on such gains at reduced rates of tax. The deduction of capital losses is subject to various limitations.
You should consult your own tax advisor regarding the availability of a foreign tax credit or deduction in respect of any Australian tax imposed on a sale or other disposition of ordinary shares. See “Australian Tax Considerations—Tax on Sales or other Dispositions of Shares.”
56
Passive Foreign Investment Companies
Special U.S. federal income tax laws apply to U.S. taxpayers who own shares of a corporation that is a PFIC. We will be treated as a PFIC for U.S. federal income tax purposes for any taxable year that either:
| ● | 75% or more of our gross income (including our pro rata share of gross income for any company, in which we are considered to own 25% or more of the shares by value), in a taxable year is passive; or |
| ● | At least 50% of our assets generally determined on the basis of a quarterly average and based upon fair market value (including our pro rata share of the assets of any company in which we are considered to own 25% or more of the shares by value) are held for the production of, or produce, passive income. |
For this purpose, passive income generally consists of rents, dividends, interest, royalties, gains from the disposition of passive assets and gains from commodities and securities transactions. Cash is treated as generating passive income.
We believe that we were not a PFIC for U.S. federal income tax purposes for our 2025 taxable year. However, the determination of PFIC status is a factual determination that must be made annually at the close of each taxable year and therefore, there can be no certainty as to our PFIC status for a taxable year until the close of that taxable year. Our PFIC status could change depending upon, among other things, a decrease in the trading price of our ordinary shares and how quickly we make use of the proceeds from the offering, as well as changes in the composition and relative values of our assets and the composition of our income. Moreover, the rules governing whether certain assets are active or passive are complex and in some cases their application can be uncertain. If we were a PFIC in any year during a U.S. holder’s holding period for the ordinary shares, we generally would continue to be treated as a PFIC for each subsequent year during which the U.S. holder owned the ordinary shares.
If we are a PFIC for any tax year in which a U.S. Holder holds our ordinary shares, each U.S. Holder who has not elected to mark the shares to market (as discussed below), would, upon receipt of certain “excess distributions” by us and upon disposition of our ordinary shares at a gain: (1) have such excess distribution or gain allocated ratably over the U.S. Holder’s holding period for the ordinary shares, as the case may be; (2) the amount allocated to the current taxable year and any period prior to the first day of the first taxable year in which we were a PFIC would be taxed as ordinary income; and (3) the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year. Distributions received by a U.S. Holder in a taxable year that are greater than 125% of the average annual distributions received during the shorter of the three preceding taxable years or the U.S. Holder’s holding period for the ordinary shares will be treated as excess distributions. In addition, when shares of a PFIC are acquired by reason of death from a decedent that was a U.S. Holder, the tax basis of such shares would not receive a step-up to fair market value as of the date of the decedent’s death, but instead would be equal to the decedent’s basis if lower, unless all gain were recognized by the decedent. Indirect investments in a PFIC may also be subject to these special U.S. federal income tax rules.
A U.S. Holder that owns (or is deemed to own) shares in a PFIC during any taxable year of the U.S. Holder generally is required to file an IRS Form 8621 with such U.S. Holder’s U.S. federal income tax return and provide such other information as the IRS may require. Failure to file IRS Form 8621 for each applicable taxable year may result in substantial penalties and result in the U.S. Holder’s taxable years being open to audit by the IRS until such forms are properly filed.
We may invest in the equity of foreign corporations that are PFICs or may own subsidiaries that are PFICs (any such entity, a “lower-tier PFIC”). If we are classified as a PFIC, under attribution rules, U.S. Holders will be subject to the PFIC rules with respect to their indirect ownership interests in such lower-tier PFICs, such that a disposition by us of the shares of the lower-tier PFIC or receipt by us of a distribution from the lower-tier PFIC generally will be treated as a deemed disposition of such shares or the deemed receipt of such distribution by the U.S. Holder, subject to taxation under the PFIC rules even though the U.S. Holder does not receive any proceeds from those dispositions or distributions. There can be no assurance that a U.S. Holder will be able to make a QEF election with respect to any lower-tier PFICs in which we invest. U.S. Holders are urged to consult their tax advisors about the application of the PFIC rules to an investment by us in a lower-tier PFIC.
The PFIC rules described above would not apply to a U.S. Holder who makes a qualified electing fund, or QEF election for all taxable years that such U.S. Holder has held the ordinary shares while we are a PFIC, provided that we comply with specified reporting requirements. Instead, each U.S. Holder who has made such a QEF election is required for each taxable year that we are a PFIC to include in income such U.S. Holder’s pro rata share of our ordinary earnings as ordinary income and such U.S. Holder’s pro rata share of our net capital gains as long-term capital gain, regardless of whether we make any distributions of such earnings or gain. In general, a QEF election is effective only if we make available certain required information. The QEF election is made on a shareholder-by-shareholder basis and generally may be revoked only with the consent of the IRS. While we will make an effort to provide such information, we cannot assure you that we will be able to do so. If we are unable to provide this information, the QEF election will not be available to you.
57
In addition, in certain circumstances, in lieu of being subject to the PFIC rules discussed above, you may make an election – the “mark-to-market election” to include in your income each year the unrealized appreciation of your PFIC stock during the year. The mark-to-market election is available only if our stock is regularly traded on a qualified exchange. Under current law, the mark-to-market election may be available to U.S. Holders of ordinary shares if our ordinary shares are listed on Nasdaq, which constitutes a qualified exchange, although there can be no assurance that our ordinary shares will be “regularly traded” for purposes of the mark-to-market election. Additionally, because a mark-to-market election cannot be made for equity interests in any lower-tier PFIC that we may own, a U.S. Holder that makes a mark-to-mark election with respect to us may continue to be subject to the PFIC rules with respect to any indirect investments held by us that are treated as an equity interest in a PFIC for U.S. federal income tax purposes.
If you make an effective mark-to-market election, you will include in each year that we are a PFIC as ordinary income the excess of the fair market value of your ordinary shares at the end of your taxable year over your adjusted tax basis in the ordinary shares. You will be entitled to deduct as an ordinary loss in each such year the excess of your adjusted tax basis in the ordinary shares over their fair market value at the end of the year, but only to the extent of the net amount previously included in income as a result of the mark-to-market election. If you make an effective mark-to-market election, any gain you recognize upon the subsequent sale or other disposition of your ordinary shares in a year that we are a PFIC will be treated as ordinary income and any loss will be treated as ordinary loss, but your basis in your shares will have been adjusted, as described below, to reflect the amount of ordinary gain or loss that you realized as a result of each mark-to-market election. Any gain or loss you recognize upon the sale or other disposition of your ordinary shares in a year when we are not a PFIC will be a capital gain or loss. See “Taxation of the Sale, Exchange or other Disposition of ordinary shares” above for the treatment of capital gains and losses.
Your adjusted tax basis in the ordinary shares will be increased by the amount of any income inclusion and decreased by the amount of any losses under the mark-to-market rules. If you make a mark-to-market election, it will be effective for the taxable year for which the election is made and all subsequent taxable years unless the ordinary shares are no longer regularly traded on a qualified exchange or the IRS consents to the revocation of the election. You are urged to consult your tax advisors about the availability of the mark-to-market election, and whether making the election would be advisable in your particular circumstances.
U.S. Holders who hold our ordinary shares during a period when we are a PFIC will be subject to the foregoing rules, even if we cease to be a PFIC. U.S. Holders are strongly urged to consult their tax advisors about the PFIC rules.
Tax on Net Investment Income
U.S. Holders who are individuals, estates or trusts will generally be required to pay a 3.8% Medicare tax on their net investment income (including dividends on and gains from the sale or other disposition of our ordinary shares), or in the case of estates and trusts on their net investment income that is not distributed to beneficiaries of the estate or trust. In each case, the 3.8% Medicare tax applies only to the extent the U.S. Holder’s total adjusted income exceeds applicable thresholds.
Backup Withholding Tax and Information Reporting Requirements
Payments of dividends with respect to the ordinary shares and proceeds from the sale, exchange or other disposition of the ordinary shares, by a U.S. paying agent or other U.S. intermediary, or made into the United States, will be reported to the IRS and to the U.S. holder as may be required under applicable Treasury regulations. Backup withholding may apply to these payments if the U.S. Holder fails to provide an accurate taxpayer identification number or certification of exempt status or fails to comply with applicable certification requirements. Certain U.S. Holders (including, among others, corporations) are not subject to backup withholding and information reporting. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules from a payment to a U.S. Holder will be refunded (or credited against such U.S. Holder’s U.S. federal income tax liability, if any), provided the required information is timely furnished to the IRS. Prospective investors should consult their own tax advisors as to their qualification for exemption from backup withholding and the procedure for establishing an exemption.
58
Certain U.S. Holders may be required to file IRS Form 926, Return by U.S. Transferor of Property to a Foreign Corporation and IRS Form 5471, Information Return of U.S. Persons With Respect to Certain Foreign Corporations, reporting transfers of cash or other property to us and information relating to the U.S. Holder and us. Substantial penalties may be imposed upon a U.S. Holder that fails to comply. See also the discussion regarding Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund, above.
In addition, certain U.S. Holders must report information on IRS Form 8938, Statement of Specified Foreign Financial Assets, with respect to their investments in certain “specified foreign financial assets,” which would include an investment in our ordinary shares, if the aggregate value of all of those assets exceeds $50,000 on the last day of the taxable year (and in some circumstances, a higher threshold). This reporting requirement applies to individuals and certain U.S. entities.
U.S. Holders who fail to report required information could become subject to substantial penalties. U.S. Holders should consult their tax advisors regarding the possible implications of these reporting requirements arising from their investment in our ordinary shares.
Exercise and Expiration of Warrants
In general, a U.S. Holder will not recognize gain or loss for U.S. federal income tax purposes upon the exercise of warrants into ordinary shares. The U.S. federal income tax treatment of a cashless exercise of warrants into our ordinary shares is unclear. U.S. Holders should consult their tax advisors regarding the U.S. federal income tax consequences of a cashless exercise of warrants.
The expiration of a warrant will be treated as if the U.S. Holder sold or exchanged the warrant and recognized a capital loss equal to the U.S. Holder’s tax basis in the warrant.
Certain Adjustments to the Warrants
Under Section 305 of the Code, an adjustment to the number of ordinary shares issued on the exercise of the warrants, or an adjustment to the exercise price of the warrants, may be treated as a constructive distribution to a U.S. Holder of the warrants if, and to the extent that, such adjustment has the effect of increasing such U.S. Holder’s proportionate interest in our “earnings and profits” or assets, depending on the circumstances of such adjustment (for example, if such adjustment is to compensate for a distribution of cash or other property to our shareholders). An adjustment to the warrants that could result in a constructive distribution to a U.S. Holder would be treated as described under “Taxation of Dividends Paid on ordinary shares” above, and the tax treatment of distributions on the warrants is unclear. Any resulting withholding tax attributable to deemed dividends would be collected from other amounts payable or distributable to the U.S. Holder. U.S. Holders should consult their tax advisors regarding the proper treatment of any adjustments to and distributions on the warrants.
The discussion above is not intended to constitute a complete analysis of all tax considerations applicable to an investment in ordinary shares or warrants. You should consult with your own tax advisor concerning the tax consequences to you in your particular situation.
59
Australian Tax Considerations
In this section, we discuss the material Australian income tax, stamp duty and goods and services tax considerations related to the acquisition, ownership and disposal by the absolute beneficial owners of the ordinary shares. This discussion represents the opinion of Australian counsel to Mobilicom.
It is based upon existing Australian tax law as of the date of this Annual Report on Form 20-F, which is subject to change, possibly retrospectively. This discussion does not address all aspects of Australian tax law which may be important to particular investors in light of their individual investment circumstances, such as shares held by investors subject to special tax rules (for example, financial institutions, insurance companies or tax-exempt organizations). In addition, this summary does not discuss any foreign (federal, state or local tax) or indirect tax considerations, other than stamp duty and goods and services tax.
Prospective investors are urged to consult their tax advisors regarding the Australian and foreign income and other tax considerations of the acquisition, ownership and disposition of the shares. As used in this summary a “Non-Australian Shareholder” is a holder that is not an Australian tax resident and is not carrying on business in Australia through a permanent establishment.
Nature of ADSs for Australian Taxation Purposes
Ordinary shares represented by ADSs held by a U.S. holder will be treated for Australian taxation purposes as held under a “bare trust” for such holder with that holder absolutely entitled to those shares. Consequently, the underlying ordinary shares will be regarded as owned by our ADS holder for Australian income tax and capital gains tax purposes. Dividends paid on the underlying ordinary shares will also be treated as dividends paid to our ADS holder, as the person beneficially entitled to those dividends. Therefore, in the following analysis we discuss the tax consequences to Non-Australian Shareholders of ordinary shares for Australian taxation purposes.
Taxation of Dividends
Australia operates a dividend imputation system under which dividends may be declared to be “franked” to the extent of tax paid on company profits. Dividends are not subject to dividend withholding tax to the extent that they are franked. An exemption for dividend withholding tax can also apply to unfranked dividends that are declared to be conduit foreign income (CFI) and paid to Non-Australian Shareholders. Dividend withholding tax will be imposed at 30% on unfranked dividends, however, a reduced rate may be available to a shareholder who is a resident of a country with which Australia has a double taxation agreement and qualifies for the benefits of the treaty. Under the provisions of the current Treaty, the Australian tax withheld on unfranked dividends that are not declared to be CFI paid by us to a resident of the United States which is beneficially entitled to that dividend is limited to 15% where that resident is a “qualified person” for the purposes of the Treaty.
If a Non-Australian Shareholder is a company and owns a 10% or more voting power in the company, the Australian tax withheld on dividends paid by us to which a resident of the United States is beneficially entitled is limited to 5% where that resident is a “qualified person” for the purposes of the Treaty. In limited circumstances the rate of withholding can be reduced to zero.
Tax on Sales or other Dispositions of Shares—Capital gains tax
Non-Australian Shareholders will not be subject to Australian capital gains tax on the gain made on a sale or other disposal of ordinary shares, unless they, together with associates, hold 10% or more of our issued capital, or voting rights, or rights to distributions of capital, at the time of disposal or for 12 months of the last 2 years prior to disposal.
Non-Australian Shareholders who own a 10% or more interest would be subject to Australian capital gains tax if more than 50% of our direct or indirect assets, determined by reference to market value, consists of Australian real property (which includes leasehold interests) or Australian mining, quarrying or prospecting rights. The Treaty is unlikely to limit Australia’s right to tax any gain in these circumstances. Net capital gains are calculated after reduction for capital losses, which may only be offset against capital gains.
Tax on Sales or other Dispositions of Shares—Shareholders Holding Shares on Revenue Account
Some Non-Australian Shareholders may hold shares on revenue rather than on capital account for example, share traders. These shareholders may have the gains made on the sale or other disposal of the shares included in their assessable income under the ordinary income taxing provisions of the income tax law, if the gains are sourced in Australia.
60
Non-Australian Shareholders assessable under these ordinary income provisions in respect of gains made on shares held on revenue account would be assessed for such gains at the Australian tax rates for non-Australian residents, which start at a marginal rate of 30% (for 2024-2025 and 2025-2026 years). The company tax rate of 30% will be reduced to 25% for certain small businesses. Some relief from Australian income tax may be available to Non-Australian Shareholders under the Treaty.
To the extent an amount would be included in a Non-Australian Shareholder’s assessable income under both the capital gains tax provisions and the ordinary income provisions, the capital gain amount would generally be reduced, so that the shareholder would not be subject to double tax on any part of the revenue gain or capital gain.
Dual Residency
If a shareholder is a resident of both Australia and the United States under those countries’ domestic taxation laws, that shareholder may be subject to tax as an Australian resident. If, however, the shareholder is an individual and is determined to be a U.S. resident for the purposes of the Treaty, the Australian tax may be subject to limitation by the Treaty. Shareholders should obtain specialist taxation advice in these circumstances.
Stamp Duty
No stamp duty is payable by Australian residents or non-Australian residents on the issue and trading of shares that are quoted on Nasdaq at all relevant times and the shares do not represent 90% or more of all of our issued shares.
Australian Death Duty
Australia does not have estate or death duties. As a general rule, no capital gains tax liability is realized upon the inheritance of a deceased person’s shares. The disposal of inherited shares by beneficiaries may, however, give rise to a capital gains tax liability if the gain falls within the scope of Australia’s jurisdiction to tax.
Goods and Services Tax
The issue or transfer of shares to a non-Australian resident investor will not incur Australian goods and services tax.
F. Dividends and Paying Agents
Not applicable.
G. Statement by Experts
Not applicable.
H. Documents on Display
We are subject to certain information reporting requirements of the Exchange Act, applicable to foreign private issuers and under those requirements will file reports with the SEC. The SEC maintains an internet site at http://www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Our filings with the SEC will also be available to the public through the SEC’s website at www.sec.gov.
61
As a foreign private issuer, we are exempt from the rules under the Exchange Act related to the furnishing and content of proxy statements. Section 8103 of the National Defense Authorization Act for Fiscal Year 2026 named, the “Holding Foreign Insiders Accountable Act” was signed into law on December 18, 2025, will require directors and officers of foreign private issuers to make insider reports under Section 16(a) of the Exchange Act, effective March 18, 2026. Our principal shareholders continue to remain exempt from the reporting under Section 16(a) of the Exchange Act and our directors, officers and principal shareholders continue to remain exempt from the short-swing profit recovery provisions contained in Section 16(b) of the Exchange Act. In addition, we are not required under the Exchange Act to file annual, quarterly and current reports and financial statements with the SEC as frequently or as promptly as United States companies whose securities are registered under the Exchange Act. However, we file with the SEC, within four months after the end of each fiscal year, or such applicable time as required by the SEC, an annual report on Form 20-F containing financial statements audited by an independent registered public accounting firm, and submit to the SEC, on a Form 6-K, unaudited quarterly financial information for the first three quarters of each fiscal year within 60 days after the end of each such quarter, or such applicable time as required by the SEC.
I. Subsidiary Information.
Not applicable.
J. Annual Report to Security Holders
Not applicable.
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Quantitative and Qualitative Disclosures about Market Risk
We are exposed to market risks in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our current investment policy is to invest available cash in bank deposits with banks that have a credit rating of at least A-minus. Accordingly, some of our cash and cash equivalents is held in deposits that bear interest. Given the current low rates of interest we receive, we will not be adversely affected if such rates are reduced. Our market risk exposure is primarily a result of AUD$/NIS exchange rates, which is discussed in detail in the following paragraph.
Foreign Exchange Risk
Our results of operations and cash flow are subject to fluctuations due to changes in AUD$/NIS currency exchange rates. While our functional currency is USD$ the vast majority of our expenses is denominated in NIS. For 2025, assuming a 10% devaluation of the USD$ to the NIS, we would experience an increase in our net loss of approximately $296,000, while assuming a 10% appreciation of the USD$ to the NIS, we would experience a decrease in our net loss of approximately $243,000. However, these historical figures may not be indicative of future exposure, as we expect that the percentage of our NIS denominated expenses will decrease in the near future as our operations expand globally, therefore reducing our exposure to exchange rate fluctuations. Currently, we do not hedge our foreign currency exchange risk. In the future, we may enter into formal currency hedging transactions to decrease the risk of financial exposure from fluctuations in the exchange rates of our principal operating currencies. These measures, however, may not adequately protect us from the material adverse effects of such fluctuations.
62
Liquidity risk
We monitor forecasts of our liquidity reserve (comprising cash and cash equivalents). We generally carry this out based on our expected cash flows in accordance with practice and limits set by our management. We are in the process of expanding our operations and the expenses associated therewith and we are therefore exposed to liquidity risk. However, we believe that our existing funds will enable us to fund our operating expenses and capital expenditure requirements for the twelve months following the date of this Annual Report on Form 20-F.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
A. Debt Securities
Not applicable.
B. Warrants and rights
Not applicable.
C. Other Securities
Not applicable.
D. American Depositary Shares
Not applicable.
63
PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
There are no material modifications to the rights of security holders.
ITEM 15. CONTROLS AND PROCEDURES
(a) Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Director of Finance, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2025, or the Evaluation Date. While there are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures, our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives. Based upon our evaluation, our Chief Executive Officer and Director of Finance have concluded that, as of the Evaluation Date, our disclosure controls and procedures, in accordance with Exchange Act Rules 13a-15(e), (i) are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be included in periodic filings under the Exchange Act, and (ii) that such information is accumulated and communicated to management, including our principal executive and financial officers, as appropriate to allow timely decisions regarding required disclosure.
(b) Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, the company’s principal executive and principal financial officers and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with international Financial Reporting Standards (“IFRS”) and includes those policies and procedures that:
| ● | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transaction and dispositions of the assets of the company; |
| ● | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and |
| ● | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. |
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013). Based on that assessment, our management concluded that as of December 31, 2025, our internal control over financial reporting was effective.
64
Changes in Internal Controls Over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the year ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
(c) Attestation Report of the Registered Public Accounting Firm
This Annual Report on Form 20-F does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting due to an exemption for emerging growth companies provided in the JOBS Act.
(d) Changes in Internal Control over Financial Reporting
During the year ended December 31, 2025, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 16. [RESERVED]
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
The current members of our audit committee are Mr. Guy Givoni, Ms. Jacqueline Bloom and Ms. Liat Caner, each meet the criteria for independence of audit committee members set forth in Rule 10A-3(b)(1) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the applicable rules of Nasdaq and each meet the financial literacy requirements of the listing standards of Nasdaq.
ITEM 16B. CODE OF ETHICS
We have established a Corporate Governance Statement, which includes a code of conduct. Our Corporate Governance Statement sets out the standards of behavior that apply to every aspect of our dealings and relationships, both within and outside Mobilicom. The following standards of behavior apply to all directors, executive officers and employees of Mobilicom:
| ● | comply with all laws that govern us and our operations; |
| ● | act honestly and with integrity and fairness in all dealings with others and each other; |
| ● | avoid or manage conflicts of interest; |
| ● | use our assets responsibly and in the best interests of Mobilicom; and |
| ● | be responsible and accountable for our actions. |
The Code of Conduct is available on our website at https://mobilicom-ltd.com.au/.
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Ziv Haft, a Firm in the BDO Global Network, an independent registered public accounting firm, or BDO, has served as our principal independent registered public accounting firm for the years ended December 31, 2025, 2024, and 2023.
65
The following table provides information regarding fees paid or to be paid by us to BDO, an independent registered public accounting firm, for all services, including audit services, for the years ended December 31, 2025, and 2024:
| Year Ended December 31, | ||||||||
| (USD in thousands) | 2025 | 2024 | ||||||
| Audit fees (1) | 148 | 145 | ||||||
| Tax fees (2) | 6 | 12 | ||||||
| Other fees (3) | 33 | 21 | ||||||
| Total | 187 | 178 | ||||||
| (1) | Audit fees consist of professional services provided in connection with the audit of our annual financial statements. |
| (2) | Tax fees consist of fees for professional services for tax compliance, tax advice, and tax audits. |
| (3) | Other fees consist of transfer pricing benchmark fees, our S-8 registration-related fees, and our F-1/POSAM registration-related fees in connection with the At-the-Market plan filed in February 2025. |
Pre-Approval of Auditors’ Compensation
Our audit committee has a pre-approval policy for the engagement of our independent registered public accounting firm to perform certain audit and non-audit services. Pursuant to this policy, which is designed to assure that such engagements do not impair the independence of our auditors, the audit committee pre-approves annually a catalog of specific audit and non-audit services in the categories of audit services, audit-related services and tax services that may be performed by our independent registered public accounting firm. If a type of service, that is to be provided by our auditors, has not received such general pre-approval, it will require specific pre-approval by our audit committee. The policy prohibits retention of the independent registered public accounting firm to perform the prohibited non-audit functions defined in applicable SEC rules.
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
Not applicable.
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
Not applicable.
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
Not applicable.
ITEM 16G. CORPORATE GOVERNANCE
The Sarbanes-Oxley Act, as well as related rules subsequently implemented by the SEC, require foreign private issuers, such as us, to comply with various corporate governance practices. In addition, following the listing of our ordinary shares and warrants on Nasdaq, we are required to comply with Nasdaq Stock Market rules. Under those rules, we may elect to follow certain corporate governance practices permitted under the applicable laws in Australia (the Corporations Act) in lieu of compliance with corresponding corporate governance requirements otherwise imposed by the Nasdaq Stock Market rules for U.S. domestic issuers.
66
In accordance with Australian law and practice and subject to the exemption set forth in Rule 5615 of the Nasdaq Stock Market rules, we have elected to follow the provisions of the applicable Australian law, rather than the Nasdaq Stock Market rules, with respect to the following requirements:
The Nasdaq listing rules allow for a foreign private issuer, such as us, to follow its home country practices in lieu of certain of the Nasdaq’s corporate governance standards. In connection with our Nasdaq Listing Application, we expect to rely on exemptions from certain corporate governance standards that are contrary to the laws, rules, regulations or generally accepted business practices in Australia. These exemptions being sought are described below:
| ● | We rely on an exemption from the requirement that our independent directors meet regularly in executive sessions under Nasdaq Listing Rules. The Corporations Act do not require the independent directors of an Australian company to have such executive sessions and, accordingly, we seek to claim this exemption. |
| ● | We rely on an exemption from the quorum requirements applicable to meetings of shareholders under Nasdaq Listing Rules. In compliance with Australian law, our Constitution provides that five shareholders present, in person or by proxy, attorney or a representative, shall constitute a quorum for a general meeting. Nasdaq Listing Rules require that an issuer provide for a quorum as specified in its by-laws for any meeting of the holders of ordinary shares, which quorum may not be less than 33% (1/3) of the outstanding shares of an issuer’s voting ordinary shares. Accordingly, because applicable Australian law and rules governing quorums at shareholder meetings differ from Nasdaq’s quorum requirements, we seek to claim this exemption. |
| ● | We rely on an exemption from the requirement prescribed by Nasdaq Listing Rules that issuers obtain shareholder approval prior to the issuance of securities in connection with certain acquisitions, private placements of securities, or the establishment or amendment of certain stock option, purchase or other compensation plans. Applicable Australian law provides for restrictions on us, as an Australian public company, issuing securities to related parties (including directors and their associates) other than in certain exceptions which include issues with shareholder approval, issues as reasonable remuneration or issues which are on arm’s length (or terms worse for the related party than arm’s length terms). We are also prohibited from issuing securities to investors without disclosure (by way of a prospectus or other Australian offer document under which disclosure is made in accordance with Australian law) unless an exemption applies to that investor or class of investors as provided for under Australian law (the exemptions included exceptions for defined professional and sophisticated investors). As we have more than 50 shareholders, an investor and their associates also must not acquire a relevant interest in 20% or more of our issued voting shares unless an exception applies under Australian law, which exceptions include shareholder approval and a regulated takeover offer. Due to differences between Australian law and rules and the Nasdaq shareholder approval requirements, we seek to claim this exemption. |
| ● | We rely on an exemption from the requirement that issuers must maintain charters for each of the following committees in compliance with Nasdaq Listing Rules: audit committee, nomination committee and compensation committee. In addition, we expect to rely on an exemption from the requirement that issuers must maintain a code of conduct in compliance with Nasdaq Listing Rules. Applicable Australian law does not require us to maintain any charters for their committees nor does such law require us to maintain a code of conduct. |
| ● | We rely on an exemption for the requirement that a majority of the board of directors be independent. Applicable Australian law does not require that a majority of the board of directors be independent. |
ITEM 16H. MINE SAFETY DISCLOSURE
Not applicable.
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
67
ITEM 16J. INSIDER TRADING POLICIES
We
have
ITEM 16K. CYBERSECURITY
We
have developed and maintain a cybersecurity risk management program, consisting of cybersecurity policies, procedures, compliance and
awareness programs to mitigate risk and to ensure compliance with security, availability and confidentiality trust principles.
The level of each identified risk is determined by considering the impact of the risk itself and the likelihood of the risk materializing and high scoring risks are actioned upon. Risks are analyzed to determine whether the risk meets company risk acceptance criteria to be accepted or whether a mitigation plan will be applied. Mitigation plans include both the individual or department responsible for the plan and may include budget considerations.
As
of the date of this report, we are
68
PART III
ITEM 17. FINANCIAL STATEMENTS
We have elected to provide financial statements and related information pursuant to Item 18.
ITEM 18. FINANCIAL STATEMENTS
The financial statements and the related notes required by this Item are included in this Annual Report on Form 20-F beginning on page F-1.
ITEM 19. EXHIBITS.
69
| * | Filed herewith. |
70
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on Form 20-F filed on its behalf.
| MOBILICOM LIMITED | ||
| Date: March 23, 2026 | By: | /s/ Oren Elkayam |
| Oren Elkayam | ||
| Chairman and Chief Executive Officer | ||
71
Mobilicom Limited
Annual Report - December 31, 2025
Mobilicom Limited Contents December 31, 2025 |  |
F-1
Report of Independent Registered Public Accounting Firm
Shareholders and Board of Directors of Mobilicom Limited
Level 7, 90 Collins Street
Melbourne, Victoria, 3000
Australia
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of Mobilicom Limited (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of profit and loss and other comprehensive income, changes in equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with International Financial Reporting Standards Accounting standards as issued by the International Accounting Standards Board and Interpretations.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
We have served as the Company’s auditor since 2021.
| /s/
| |
| Ziv haft | |
| March 23, 2026 | Certified Public Accountants (Isr.) |
| BDO Member Firm |
F-2
Mobilicom Limited Consolidated statements of profit or loss and other comprehensive income (loss) For the year ended December 31, 2025 | |
| Consolidated | ||||||||||||||||
| Note | 2025 | 2024 | 2023 | |||||||||||||
| $ | $ | $ | ||||||||||||||
| Revenue | 4 | |||||||||||||||
| Cost of sales | 6 | ( | ) | ( | ) | ( | ) | |||||||||
| Government grants | 5 | |||||||||||||||
| Interest received | 2,5 | |||||||||||||||
| Foreign exchange gains | ||||||||||||||||
| Expenses | ||||||||||||||||
| Selling and marketing expenses | 7,24 | ( | ) | ( | ) | ( | ) | |||||||||
| Research and development | 8,24 | ( | ) | ( | ) | ( | ) | |||||||||
| General and administration expenses | 9,24 | ( | ) | ( | ) | ( | ) | |||||||||
| Finance costs | ( | ) | ( | ) | ( | ) | ||||||||||
| Foreign exchange losses | ( | ) | ||||||||||||||
| Loss from fair value changes for exercised warrants | 21 | ( | ) | ( | )* | |||||||||||
| Fair value loss from financial liability | 21 | ( | ) | ( | )* | ( | ) | |||||||||
| Loss before income tax expense | ( | ) | ( | ) | ( | ) | ||||||||||
| Tax expense (income) | 10 | ( | ) | ( | ) | |||||||||||
| Net loss for the year attributable to the owners of Mobilicom Limited | ( | ) | ( | ) | ( | ) | ||||||||||
| * |
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
F-3
Mobilicom Limited Consolidated statements of profit or loss and other comprehensive income (loss) For the year ended December 31, 2025 | |
| Consolidated | ||||||||||||||||
| Note | 2025 | 2024 | 2023 | |||||||||||||
| $ | $ | $ | ||||||||||||||
| Other comprehensive loss | ||||||||||||||||
| Items that will not be reclassified subsequently to profit or loss | ||||||||||||||||
| Re-measurement of defined benefit plans (refer to note 22) | ( | ) | ||||||||||||||
| Items that may be reclassified subsequently to profit or loss | ||||||||||||||||
| Foreign currency translation (refer to note 22) | ( | ) | ( | ) | ||||||||||||
| Other comprehensive loss for the year, net of tax | ( | ) | ( | ) | ||||||||||||
| Total comprehensive loss for the year attributable to the owners of Mobilicom Limited | ( | ) | ( | ) | ( | ) | ||||||||||
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
F-4
Mobilicom Limited Consolidated statements of profit or loss and other comprehensive income (loss) For the year ended December 31, 2025 | |
| Consolidated | ||||||||||||||||
| Note | 2025 | 2024 | 2023 | |||||||||||||
| $ | $ | $ | ||||||||||||||
| Basic earnings (loss) per share | 31 | ( | ) | ( | )* | ( | )* | |||||||||
| Diluted earnings (loss) per share | 31 | ( | ) | ( | )* | ( | )* | |||||||||
| Weighted average number of ordinary shares used in calculating basic and diluted earnings (loss) per share | * | * | ||||||||||||||
| * | Restated |
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
F-5
| Consolidated | ||||||||||||
| Note | 2025 | 2024 | ||||||||||
| $ | $ | |||||||||||
| Assets | ||||||||||||
| Current assets | ||||||||||||
| Cash and cash equivalents | 11 | |||||||||||
| Restricted cash | 11 | |||||||||||
| Trade receivables, net | 12 | |||||||||||
| Other receivables | 12 | |||||||||||
| Inventories | 13 | |||||||||||
| Total current assets | ||||||||||||
| Non-current assets | ||||||||||||
| Property, plant and equipment, net | 14 | |||||||||||
| Right-of-use assets | 15 | |||||||||||
| Total non-current assets | ||||||||||||
| Total assets | ||||||||||||
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
F-6
Mobilicom Limited Consolidated statements of financial position As at December 31, 2025 | |
| Consolidated | ||||||||||||
| Note | 2024 | 2023 | ||||||||||
| $ | $ | |||||||||||
| Liabilities | ||||||||||||
| Current liabilities | ||||||||||||
| Trade and other payables | 16 | |||||||||||
| Lease liabilities | 17 | |||||||||||
| Total current liabilities | ||||||||||||
| Non-current liabilities | ||||||||||||
| Lease liabilities | 17 | |||||||||||
| Employee benefits | 19 | |||||||||||
| Governmental liabilities on grants received | 20 | |||||||||||
| Financial liability | 18,21 | |||||||||||
| Total non-current liabilities | ||||||||||||
| Total liabilities | ||||||||||||
| Net assets | ||||||||||||
| Equity | ||||||||||||
| Issued capital | 21 | |||||||||||
| Reserves | 22,24 | ( | ) | |||||||||
| Accumulated losses | ( | ) | ( | ) | ||||||||
| Total equity | ||||||||||||
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
F-7
| Issued | Share based payments | Foreign currency translation | Re-measurement | Accumulated | Total | |||||||||||||||||||
| capital | reserve | reserves | reserves | losses | equity | |||||||||||||||||||
| Consolidated | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Balance at January 1, 2023 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||
| Other comprehensive income (loss) for the year | ( | ) | ( | ) | ||||||||||||||||||||
| Translation adjustment due to change in presentation currency* | ( | ) | ( | ) | ||||||||||||||||||||
| Total comprehensive loss for the year | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Share-based payments (note 24) | ||||||||||||||||||||||||
| Transactions with owners in their capacity as owners: | ||||||||||||||||||||||||
| Forfeiture of options | ( | ) | ( | ) | ||||||||||||||||||||
| Expiry of options | ( | ) | ||||||||||||||||||||||
| Cancellation of shares | ( | ) | ( | ) | ||||||||||||||||||||
| Balance at December 31, 2023 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| * |
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
F-8
Mobilicom Limited Consolidated statements of changes in equity For the year ended December 31, 2025 | |
| Issued | Share based payments | Foreign currency translation | Re-measurement | Accumulated | Total | |||||||||||||||||||
| capital | reserve | reserves | reserves | losses | equity | |||||||||||||||||||
| Consolidated | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Balance at January 1, 2024 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||
| Other comprehensive income (loss) for the year | ( | ) | ( | ) | ||||||||||||||||||||
| Total comprehensive loss for the year | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Share-based payments (note 24) | ||||||||||||||||||||||||
| Transactions with owners in their capacity as owners: | ||||||||||||||||||||||||
| Contributions of equity, net of transaction costs (note 21) | ||||||||||||||||||||||||
| Forfeiture of options | ( | ) | ( | ) | ||||||||||||||||||||
| Expiry of options | ( | ) | ||||||||||||||||||||||
| Balance at December 31, 2024 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
F-9
Mobilicom Limited Consolidated statements of changes in equity For the year ended December 31, 2025 | |
| Issued | Share based payments | Foreign currency translation | Re-measurement | Accumulated | Total | |||||||||||||||||||
| capital | reserve | reserves | reserves | losses | equity | |||||||||||||||||||
| Consolidated | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Balance at January 1, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||||||
| Other comprehensive loss for the year | ( | ) | ||||||||||||||||||||||
| Total comprehensive loss for the year | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Share-based payments (note 24) | ||||||||||||||||||||||||
| Transactions with owners in their capacity as owners: | ||||||||||||||||||||||||
| Contributions of equity, net of transaction costs (note 21) | ||||||||||||||||||||||||
| Shares issued under service agreement (note 21) | ||||||||||||||||||||||||
| Exercise of options | ( | ) | ||||||||||||||||||||||
| Vesting of restricted share units (RSU) | ( | ) | ||||||||||||||||||||||
| Forfeiture of options | ( | ) | ( | ) | ||||||||||||||||||||
| Expiry of options | ( | ) | ||||||||||||||||||||||
| Balance at December 31, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
F-10
| Consolidated | ||||||||||||||||
| Note | 2025 | 2024 | 2023 | |||||||||||||
| $ | $ | $ | ||||||||||||||
| Cash flows from operating activities | ||||||||||||||||
| Receipts from customers (inclusive of VAT) | ||||||||||||||||
| Interest received | ||||||||||||||||
| Interest paid | ( | ) | ( | ) | ( | ) | ||||||||||
| Payments to suppliers and employees (inclusive of VAT) | ( | ) | ( | ) | ( | ) | ||||||||||
| Government grants received and tax incentives | ||||||||||||||||
| Net cash used in operating activities | 30 | ( | ) | ( | ) | ( | ) | |||||||||
| Cash flows from investing activities | ||||||||||||||||
| Payments for property, plant and equipment | ( | ) | ( | ) | ( | ) | ||||||||||
| Net cash used in investing activities | ( | ) | ( | ) | ( | ) | ||||||||||
| Cash flows from financing activities | ||||||||||||||||
| Proceeds from issue of shares | 21 | |||||||||||||||
| Share issue transaction costs | ( | ) | ( | ) | ||||||||||||
| Proceeds from exercise of warrants | ||||||||||||||||
| Proceeds from exercise of options | ||||||||||||||||
| Shares buyback (Small parcel plan) payments | ( | ) | ||||||||||||||
| Repayment of lease liabilities | ( | ) | ( | ) | ( | ) | ||||||||||
| Net cash provided by/ (used in) financing activities | ( | ) | ||||||||||||||
| Net Increase (decreased) in cash and cash equivalents and restricted cash | ( | ) | ||||||||||||||
| Cash and cash equivalents and restricted cash at the beginning of the financial year | ||||||||||||||||
| Cash and cash equivalents and restricted cash at the end of the financial year | 11 | |||||||||||||||
| Supplemental disclosure of non-cash financing activities | ||||||||||||||||
| Financial liability classified to issued capital | ||||||||||||||||
| Shares issued under service agreement | ||||||||||||||||
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
F-11
Note 1. General information
The financial statements cover Mobilicom Limited (the “Company”) as a Group consisting of Mobilicom Limited and the entities it controlled at the end of, or during, the year. On 1 January 2024, the Company transitioned from the Australian dollar (“AUD”) as its presentation currency to the U.S. dollar (‘USD”) as its presentation currency. The change was accounted as a change of accounting policy on a retrospective basis. In addition, commencing 1 January 2024, the Company transitioned from AUD as its functional currency to USD as its functional currency. See note 2 for further details.
The functional currency of the Company’s subsidiary, Mobilicom Ltd (“Mobilicom Israel”), is New Israeli Shekel (or NIS) and the functional currency of the Company’s subsidiary, Mobilicom Inc., is USD.
The Company uses the terms $, USD or US Dollar in this Annual Report where refers to US Dollar, and AUD where refers to Australian dollars.
The Company is a listed public company limited by shares, incorporated and domiciled in Australia. On October 19, 2023, the Company chose to voluntarily remove its ordinary shares from the Australian Securities Exchange (“ASX”) and trade exclusively on the NASDAQ in the form of American Depository Receipts. On December 8, 2025, the Company effectively completed transition to a direct listing of the Company’s ordinary shares on the Nasdaq Capital Market following an earlier 1-for-275 reverse share split of the Company’s ordinary shares and termination of its ADSs. All shares related numbers for the years ended December 31, 2025, 2024 and 2023 were restated to reflect this change. See note 21 for further details. Its registered office and principal place of business are:
| Registered office | Principal place of business | |
| C/- JM Corporate Services | 1 Rakefet Street | |
| Level 21, 459 Collins Street | Shoham, Israel 6083705 | |
| Melbourne, Victoria, 3000 | ||
| Australia |
The Company’s principal activities are design, develop and deliver of cybersecurity and robust solutions including communication datalinks, mesh network, ground control systems and cloud-software solutions for drone, robotics and autonomous platforms.
The Company is an end-to-end provider of cybersecurity and robust solutions for drones, robotics & autonomous platforms. As a high-tech company it designs, develops, and delivers robust solutions focused primarily on targeting global drone, robotics and autonomous system manufacturers. The Company holds patented technology & unique know-how for Mobile Mesh networking. It has a large, field proven portfolio of commercialized products used in a variety of applications. The Company is growing a global customer base with sales to high profile customers including corporates, governments, and military departments. The Company’s competitive advantages include outstanding security capabilities and performance in harsh environmental conditions. The Company’s large solution portfolio is being deployed worldwide, seeing the Company derive revenue from hardware, software sales & licensing fees.
F-12
Note 1. General information (continued)
In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. As a result of the events of October 7, 2023, the Israeli government declared that the country was at war and the Israeli military began to call-up reservists for active duty. In October 2025, a ceasefire was brokered between Israel and Hamas. However, we cannot predict if and to what extent this ceasefire will remain in effect or upheld. Since the commencement of these events, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization) and on other fronts from various extremist groups in the region, such as the Houthis in Yemen and various rebel militia groups in Syria and Iraq. Israel has carried out a number of targeted strikes on sites belonging to these terror organizations. In October 2024, Israel began limited ground operations against Hezbollah in Lebanon, and in November 2024, a ceasefire was brokered between Israel and Hezbollah. However, In March 2026, tensions escalated once again as Hezbollah launched an attack on Israel, firing rockets across the border. In response, Israel carried out targeted airstrikes against Hezbollah positions in Lebanon, raising concerns among the international community about the potential for a wider conflict. In addition, in response to ongoing Iranian aggression and support of proxy attacks against Israel, on June 13, 2025, Israel conducted a series of preemptive defensive air strikes in Iran targeting Iran’s nuclear program and military commanders. While a ceasefire was reached in June 2025 following 12 days of hostilities, on February 28, 2026, the United States and Israel launched coordinated military strikes against Iran, including attacks on strategic military infrastructure and leadership targets, with the stated aim of degrading Iran’s capacity to conduct or support hostile operations against them. In response, Iran has fired missiles and drones toward population centers and military installations in Israel, Europe and neighboring countries in the Gulf region, and also launched counter-strikes against U.S. forces and allied bases throughout the Gulf region. Continued military escalation, retaliatory actions, or broader regional involvement may adversely affect economic conditions, disrupt markets, and create uncertainty that could negatively impact our business, financial condition and results of operations. Additionally, following the fall of the Assad regime in Syria, Israel has conducted limited military operations targeting the Syrian army, Iranian military assets and infrastructure linked to Hezbollah and other Iran-supported groups. It is possible that hostilities with Iran, Hezbollah, the Houthis and terrorist groups in Syria will escalate, and that other terrorist organizations, including Palestinian military organizations in the West Bank, will join the hostilities. The underlying tensions driving these conflicts remain unresolved. The ongoing hostilities between Israel and Iran or Hezbollah — whether through direct military action, proxy escalation, or retaliatory strikes — could result in significant disruption to civilian infrastructure, supply chains, and personnel availability across Israel. Such escalation could materially and adversely affect the Company’s operations, which are primarily conducted through its Israeli subsidiary, Mobilicom Ltd. To date, only one of the Company’s employees is in active military reserve duty. Nevertheless, the Company continues to monitor developments and, as of the date of these financial statements, the Company’s product development, research and development, and business development activities have continued without material disruption.
The financial statements were authorized for issue, in accordance with a resolution of directors, on March 19, 2026. The directors have the power to amend and reissue the financial statements.
Liquidity analysis
These consolidated financial statements have been prepared on the assumption
that the Company will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to
realize assets and discharge liabilities in the ordinary course of operations. As of December 31, 2025, the Company has not achieved
positive cash flow from operations and incurred a net loss of $
F-13
Note 2. Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out either in the respective notes or below. These policies have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The following amendments are effective for the period beginning January 1, 2025:
| ● | Lack of Exchangeability (Amendment to IAS 21 The Effects of Changes in Foreign Exchange Rates). This amendment had no material effect on the consolidated financial statements of the Company. |
New standards, interpretations and amendments not yet effective:
There are number of standards and interpretations which have been issued by the International Accounting Standards Board that are effective for periods beginning subsequent to December 31, 2025 (the date on which the Company’s next annual financial statements will be prepared up to) that the Company has decided not to adopt early.
The following amendments are effective for the annual reporting period beginning January 1, 2026:
| ● | Amendments to the Classification and Measurement of Financial Instruments (Amendment to IFRS 9 Financial Instruments and IFRS 7) |
| ● | Contracts Referencing Nature-dependent Electricity (Amendments to IFRS 9 and IFRS 7); |
The following standards and amendments are effective for the annual reporting period beginning January 1, 2027:
| ● | IFRS 18 Presentation and Disclosure in Financial Statements |
| ● | IFRS 19 Subsidiaries without Public Accountability: Disclosures |
The Company is currently assessing the effect of these new accounting standards and amendments.
Basis of preparation
These financial statements have been prepared in accordance with International Financial Reporting Standards Accounting Standards as issued by the International Accounting Standards Board (‘IASB’) and Interpretations.
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets and liabilities at fair value through profit or loss and other comprehensive income (loss).
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3 below.
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of the Company as at December 31, 2025 and the results of all subsidiaries for the year then ended.
F-14
Note 2. Significant accounting policies (continued)
Subsidiaries are all those entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the Company are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Company.
Where the Company loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The Company recognises the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in profit or loss.
Financial statements in U.S. dollars (“USD”):
Since the Company’s listing on the Nasdaq Capital Market (“Nasdaq”) in August 2022, all capital raises have been denominated in USD. In addition, a majority of the Company’s current assets are in USD, as well as a significant portion of the costs incurred by the Company are in USD. Management believes that the USD is the primary currency of the economic environment in which the Company operates. On January 1, 2024, the Company moved to USD as its presentation currency. In these consolidated financial statements, the change was accounted as a change of accounting policy on a retrospective application. The change in presentation currency was triggered by change in the functional currency of the Company to USD, which was accounted prospectively from January 1, 2024, requiring re-measurement from the local currency into USD for the Company. All exchange gains and losses resulting from the re-measurement are reflected in the consolidated statement of profit or loss and other comprehensive income, as appropriate.
Prior to January 1, 2024, the functional currency of the Company was the AUD. Accordingly, the financial statements of the Company were translated into USD. All statement of financial position accounts were translated using the exchange rates in effect at the balance sheet date. Amounts recorded in the consolidated statement of profit or loss and other comprehensive income were translated using the average exchange rate prevailing during the year. The resulting translation adjustments were reported as a component of shareholders’ equity under accumulated other comprehensive income.
Effective as of the Company’s fiscal year beginning January 1, 2024, the Company’s functional currency became the USD. IAS 21” The Effects of Changes in Foreign Exchange Rates”, requires a change in functional currency to be reported as of the date it is determined there has been a change, and it is generally accepted practice that the change is made at the start of the most recent period that approximates the date of the change. Management determined it would enact this change effective on January 1, 2024. While the change was based on a factual assessment, the determination of the date of the change required management’s judgement given the change in the primary economic and business environment, in which the Company operates, have evolved over time. As part of management’s functional currency assessment, changes in economic facts and circumstances were considered. This included analysis of changes in: management of operations, process, and in the composition of cash and equity balances. The Company has implemented budgeting in USD, whereas this was previously performed in AUD. The Company’s cash inflows consist primarily of USD cash balances and less of AUD, as also reflected in the budget. Following the Company’s delisting from the Australian Securities Exchange in November 2023, the Company focus its capital raise efforts primarily in USD. Assuming current business operating model stays constant, management believes that the USD cash balances will continue to increase, while AUD cash balances will continue to produce a net outflow.
F-15
Note 2. Significant accounting policies (continued)
Management re-evaluated all indicators established in IAS 21 to determine the functional currency of the Company. Such indicators include i) cash flow, ii) expense, iii) financing and iv) intercompany transactions and arrangements. Management determined that the cash flow and financing indicators were most relevant to the Company operations and its primary economic environment. At the time of the assessment adopted on January 1, 2024, cash flows generated by the Company that relate to its assets and liabilities now directly affect the Company’s cash flows and are readily available for remittance to the Company. The majority of cash flow of the Company’s operations is denominated in USD. Significant asset and equity items on the Company balance sheet are comprised almost solely (greater than 90%) of USD denominated transactions. Furthermore, most of the Company’s generated cash flows are now invested in USD based cash and cash equivalents. Since such investments are short-term, cash is readily available for current needs of the group. Thus, the USD is the primary currency from which the Company generates and accumulates cash.
When considering all relevant facts together, management concluded that the USD best reflects the currency of the primary economic environment in which the Company currently operates. Therefore, USD is the functional currency as a result of the change in the most significant economic facts and circumstances from cash flow and financing indicators. As a result, the Company adopted USD as the functional currency effective January 1, 2024.
The change was accounted for prospectively from the date of the change in accordance with IAS 21, “Foreign Currency Matters.” The translated balances of monetary and nonmonetary assets and liabilities recorded in the Company financial statements as of the end of the prior reporting period became the new accounting basis for those assets and liabilities in the period of the change. To the extent the entity had monetary assets and liabilities denominated in the old functional currency, such balances created transactional gains and losses subsequent to the change in functional currency. The amount recorded in the currency translation adjustment account for prior periods was not reversed upon the change in functional currency. The exchange rate on the date of the change became the historical rate for subsequent re-measurement of nonmonetary assets and liabilities into the new functional currency.
The following table summarizes the impact on both consolidated net loss and other comprehensive income (loss) utilizing USD as the functional currency of the Company as of December 31, 2024, compared to the related impact if the functional currency of the Company would have remained AUD (excluding foreign exchange from transactions denominated in AUD recorded in the respective period)
USD as Functional Currency (in USD) | AUD as Functional Currency (in USD)(*) | |||||||
| (Unaudited Pro Forma) | ||||||||
| Financial income, net - attributed to foreign translation gain | ||||||||
| Other comprehensive loss - attributed to foreign currency translation adjustments | ( | ) | ( | ) | ||||
| (*) |
Foreign currency translation
Starting January 1, 2024, the financial statements are presented in US dollars, which is the Company’s presentation currency and functional currency. The functional currency of the Company’s subsidiary, Mobilicom Ltd (“Mobilicom Israel”), is NIS.
Foreign currency transactions
Foreign currency transactions are translated into US dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Non-monetary items are converted at the rate of exchange used to convert the related consolidated statements of financial position items, i.e., at the time of the transaction.
F-16
Note 2. Significant accounting policies (continued)
Foreign operations
The assets and liabilities of foreign operations are translated into US dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into US dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Restricted cash represents deposits with banks which are used mainly as a security for guarantees provided against facilities lease agreement and line of use for credit cards.
Accounting policy for right-of-use assets
A right-of-use asset is recognized at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Research and development
Expenditure during the research phase of a project is recognised as an expense when incurred.
Development costs are capitalised only when technical feasibility studies identify that the project will develop an intangible asset that will be completed and available for use or sale, that there are adequate technical, financial and other resources to complete the development, that it will deliver future economic benefits and these benefits can be measured reliably.
Recoverable amount is the higher of an asset’s fair value less costs of disposal and value-in-use. The value-in-use is the present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit.
Segments
The
Company operates in
Fair value of financial instruments
Liability included in the Company’s Consolidated statement of financial position utilizes market observable inputs and data as far as possible. Inputs used in determining fair value measurement are categorized into different levels based on how observable the inputs used in the valuation technique utilized are (the ‘fair value hierarchy’):
| ● | Level 1: Quoted priced in active markets for identical items (unadjusted) |
| ● | Level 2: Observable direct or indirect inputs other than level 1 inputs. |
| ● | Level 3: Unobservable inputs (i.e., not derived from market data). |
The classification of an item into the above levels is based on the lowest level of the inputs used that has a significant effect on the fair value measurement of the item. Transfers of items between levels are recognized in the period they occur.
The Company measures the Financial liability (warrants) at fair value. See note 3, note 20 and note 21.
F-17
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below.
Share-based payments
The Company has a share-based remuneration scheme for employees. The fair value of share options is estimated by using the Black-Scholes option pricing model, on the date of grant based on certain assumptions. Those assumptions are described in the share-based payments note and include, among others, the dividend growth rate, expected share price volatility and expected life of the options. The fair value of the equity settled options granted is charged to statement of comprehensive income over the vesting period of each tranche and the credit is taken to equity, based on the Company’s estimate of shares that will eventually vest.
Financial Liability
The Company measures the fair value of the warrants issued under August 2022 Nasdaq IPO & listing, and warrants issued under January 2024 registered direct offering on Nasdaq. The fair value of the warrants is estimated by using the Hull-White option pricing model (trinomial Lattice model), on the date of each grant and remeasured at each reporting period (December 31, 2025 and 2024) and is based on certain assumptions. Those assumptions include, among others, the dividend growth rate, expected share price, volatility and expected life of the warrants, early exercise / exercise multiple, capital structure effects and trinomial steps.
Lease term
The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement is exercised in determining whether there is reasonable certainty that an option to extend the lease or purchase the underlying asset will be exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods to be included in the lease term. In determining the lease term, all facts and circumstances that create an economical incentive to exercise an extension option, or not to exercise a termination option, are considered at the lease commencement date. Factors considered may include the importance of the asset to the Company’s operations; comparison of terms and conditions to prevailing market rates; incurrence of significant penalties; existence of significant leasehold improvements; and the costs and disruption to replace the asset. The Company reassesses whether it is reasonably certain to exercise an extension option, or not exercise a termination option, if there is a significant event or significant change in circumstances.
F-18
Note 4. Revenue
Revenue from contracts with customers
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Sale of goods | ||||||||||||
| ● | Revenue
from the sale of goods is recognised at the point in time when the customer obtains control
of the goods, which is generally at the time of delivery. There is limited judgment needed
in identifying the point control passes: once physical delivery of the products to the agreed
location has occurred, the Company no longer has physical possession, usually will have a
present right to payment (as a single payment on delivery) and retains none of the significant
risks and rewards of the goods in question. |
| ● | Goods
sold by the Company include warranties which require the group to either replace or amend
a defective product during the warranty period if the goods fail to comply with agreed-upon
specifications. In accordance with IFRS 15, such warranties are not accounted for as separate
performance obligations and hence no revenue is allocated to them. Instead, a provision is
made for the costs of satisfying the warranties in accordance with IAS 37 Provisions, Contingent
Liabilities and Contingent Assets. The Company provides one year of warranty. During the
periods of the financial statements, warranty costs were immaterial. |
| ● | The
Company do not offer a right of return option for its products, therefore there is no accrual
for future returns and no reduction in revenue related to returns. |
| ● | The Company offers discounts on per order basis, which are deducted from revenues, furthermore the Company do not offer additional discount as a condition for future orders, therefore, there is no material right accounted for related to discounts. |
For the years ended December 31, 2025, 2024 and 2023, no deferred revenues were recognized under sales of goods.
Major customers
| As of December 31, | ||||||||
| 2025 | 2024 | |||||||
| Custome | % of total income | % of total income | ||||||
| B | % | % | ||||||
| C | % | % | ||||||
Income by geographic
| 2025 | 2024 | 2023 | ||||||||||
| % of total income | % of total income | % of total income | ||||||||||
| Israel | % | % | % | |||||||||
| U.S. & Canada | % | % | % | |||||||||
| Rest of world | % | % | % | |||||||||
F-19
Note 5. Income
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset.
Government Grant income
The Company receives government grant income from the Israeli Innovation Authority (formerly the Office of the Chief Scientist) (Innovation Authority), as support for participation in sponsored programs for research and development projects. Grants are received for eligible research and development expenses, upon submission and acceptance of periodic project performance reports. Grant income is recognized as the related milestone is met.
Fair value gains (loss) from financial liability
Fair value gain (loss) is recognized at an amount that reflects the changes in fair value of the financial liability between the measured periods.
Note 6. Cost of sales
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Salaries and benefits | ||||||||||||
| Cost of materials | ||||||||||||
| Occupancy and office expenses | ||||||||||||
| Other | ||||||||||||
| Depreciation | ||||||||||||
Note 7. Selling and marketing expenses
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Salaries and benefits | ||||||||||||
| Marketing services | ||||||||||||
| Travel expenses | ||||||||||||
| Depreciation | ||||||||||||
| Occupancy and office expenses | ||||||||||||
| Other | ||||||||||||
F-20
Note 8. Research and development
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Salaries and benefits | ||||||||||||
| Materials | ||||||||||||
| Royalties to the OCS | ( | ) | ||||||||||
| Subcontractors | ||||||||||||
| Depreciation | ||||||||||||
| Other | ||||||||||||
Note 9. General and administration expenses
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Salaries and benefits | ||||||||||||
| Professional fees | ||||||||||||
| Insurance | ||||||||||||
| Travel expenses | ||||||||||||
| Depreciation | ||||||||||||
| Occupancy and office expenses | ||||||||||||
| Nasdaq annual fees | * | * | ||||||||||
| Depository and transfer agent | * | * | ||||||||||
| Investor relations and press releases | * | * | ||||||||||
| Other | * | * | ||||||||||
| * |
F-21
Note 10. Income tax expense
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Numerical reconciliation of income tax expense and tax at the statutory rate | ||||||||||||
| Loss before income tax expense | ( | ) | ( | ) | ( | ) | ||||||
| Tax at the statutory tax rate of | ( | ) | ( | ) | ( | ) | ||||||
| Tax expenses related with previous years’ non-deductible/(taxable) costs in calculating taxable income | ||||||||||||
| Reversal of over-accrued tax expense related with previous years U.S. Federal and State taxes | ( | ) | ||||||||||
| Effect of statutory tax rates difference between Australian company tax rate to Israeli company’s tax rate ( | ||||||||||||
| Effect of statutory tax rates difference between Australian company tax rate to U.S. Federal company’s tax rate ( | ( | ) | ( | ) | ( | ) | ||||||
| Tax effect amounts which are not deductible/(taxable) in calculating taxable income: | ||||||||||||
| Share-based payments | ||||||||||||
| Other temporary differences not recognised | ||||||||||||
| Tax income (expense) | ( | ) | ( | ) | ||||||||
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that is it probable that future taxable profits will be available against which the benefits of the deferred tax asset can be utilised.
F-22
Note 11. Current assets - cash and cash equivalents and restricted cash
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Cash and cash equivalents | ||||||||
| Restricted cash | ||||||||
| Cash at banks | ||||||||
Note 12. Current assets - trade and other receivables, net
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Trade receivables | ||||||||
| Other receivables | ||||||||
Accounting policy for trade and other receivables
Trade receivables are initially recognised at transaction price and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.
The Company applies the IFRS 9 simplified approach to measuring expected credit losses using a lifetime expected credit loss provision for trade receivables. To measure expected credit losses on a collective basis, trade receivables are grouped based on similar credit risk and aging. Based on the Company’s measurement the allowance for expected credit losses or overdue balances was found immaterial and was not accounted for in the financial statements.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
F-23
Note 13. Current assets - inventories
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Finished goods - at cost | ||||||||
| Raw materials- at cost | ||||||||
| Accrual for slow inventory | ( | ) | ( | ) | ||||
Accounting policy for inventories
Inventories are recognised at the lower of cost and net realisable value.
Inventories cost is based on a weighted average method.
Note 14. Non-current assets - property, plant and equipment, net
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Computer equipment - at cost | ||||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
| Office furniture & equipment - at cost | ||||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
| Machinery & equipment - at cost | ||||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
F-24
Note 14. Non-current assets - property, plant and equipment, net (continued)
Reconciliations
Reconciliations of the values at the beginning and end of the current and previous financial year are set out below:
| Computer | Office furniture & | Machinery & | ||||||||||||||
| equipment | equipment | equipment | Total | |||||||||||||
| Consolidated | $ | $ | $ | $ | ||||||||||||
| Balance at January 1, 2024 | ||||||||||||||||
| Additions | ||||||||||||||||
| Depreciation expense | ( | )* | ( | )* | ( | )* | ( | )* | ||||||||
| Translation adjustments | ( | )* | ( | )* | ( | )* | ( | )* | ||||||||
| Balance at December 31, 2024 | ||||||||||||||||
| Additions | ||||||||||||||||
| Depreciation expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Translation adjustments | ||||||||||||||||
| Balance at December 31, 2025 | ||||||||||||||||
| * |
Accounting policy for property, plant and equipment
Plant and equipment are stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment (excluding land) over their expected useful lives as follows:
| Computer equipment | ||
| Machinery and equipment | ||
| Office furniture and equipment |
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Company. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
Note 15. Non-current assets - right-of-use assets
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Land and buildings - right-of-use | ||||||||
| Motor vehicles - right-of-use | ||||||||
Additions
to the right-of-use assets during the financial year were $
F-25
Note 15. Non-current assets - right-of-use assets (continued)
The Company leases land and buildings for its
offices in Israel under agreements for
Reconciliations
Reconciliations of the values at the beginning and end of the current and previous financial year are set out below:
| Land and | Motor | |||||||||||
| Buildings | Vehicle | Total | ||||||||||
| Consolidated | $ | $ | $ | |||||||||
| Balance at January 1, 2024 | ||||||||||||
| Depreciation expense | ( | )* | ( | )* | ( | )* | ||||||
| Translation adjustments | ( | )* | ( | )* | ( | )* | ||||||
| Balance at December 31, 2024 | ||||||||||||
| Additions | ||||||||||||
| Disposals (return of leased cars) | ( | ) | ( | ) | ||||||||
| Depreciation expense | ( | ) | ( | ) | ( | ) | ||||||
| Translation adjustments | ||||||||||||
| Balance at December 31, 2025 | ||||||||||||
| * |
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the company expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
The Company has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred.
F-26
Note 16. Current liabilities - trade and other payables
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Trade payables | ||||||||
| Other payables | ||||||||
Refer to notes 2 and 25 for further information on financial instruments.
Amounts noted above in other payables include amounts payable to Directors for wages payable.
Accounting policy for trade and other payables
These amounts represent liabilities for goods and services provided to the company prior to the end of the financial year and which are unpaid. Due to their short-term nature, they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.
F-27
Note 17. Lease liabilities
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Current | ||||||||
| Non-current | ||||||||
Refer to note 25 for further information on financial instruments.
Accounting policy for lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index, or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written down.
Reconciliations
Reconciliations of the values at the beginning and end of the current and previous financial year are set out below:
| 2025 | 2024 | |||||||
| Consolidated | $ | $ | ||||||
| Balance at January 1 | ||||||||
| Additions | ||||||||
| Disposals (return of leased cars) | ( | ) | ||||||
| Accretion of interest | ||||||||
| Payments | ( | ) | ( | ) | ||||
| Effect of exchange rates differences | ( | ) | ||||||
| Balance at December 31 | ||||||||
| 1 year or less | Between 1 and 2 years | Between 2 and 3 years | Over 3 years | Total | ||||||||||||||||
| Consolidated | $ | $ | $ | $ | $ | |||||||||||||||
| December 31, 2025 | ||||||||||||||||||||
| December 31, 2024 | ||||||||||||||||||||
F-28
Note 18. Financial liability
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Warrants at fair value | ||||||||
On August 25, 2022, the Company completed its Nasdaq
listing via the issuance of
On January 30, 2024, the Company completed a registered
direct offering via the issuance of
In addition, on January 30, 2024, in a concurrent
private placement, the Company issued to the investors in the registered direct offering and the placement agent warrants to purchase
up to an aggregate of
The above warrants represent financial liabilities at fair value through profit or loss.
Refer to note 21 for further information on issued capital.
Note 19. Non-current liabilities - employee benefits
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Employee benefits | ||||||||
The Company’s liabilities for severance pay retirement and pension pursuant to Israeli law and employment agreements are recognized by full - in part by managers’ insurance policies, for which the Company makes monthly payments and accrued amounts in severance pay funds and the rest by the liabilities which are included in the financial statements.
The amounts funded displayed above include amounts deposited in severance pay funds with the addition of accrued income. According to the Severance Pay Law, the aforementioned amounts may not be withdrawn or mortgaged as long as the employer’s obligations have not been fulfilled in compliance with Israeli law.
F-29
Note 19. Non-current liabilities - employee benefits (continued)
Statement of financial position amounts
The amounts recognized in the statement of financial position determined as follows:
| Consolidated | ||||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Present value of the defined benefit obligation | ||||||||
| Fair value of defined benefit plan assets | ( | ) | ( | ) | ||||
| Other long-term obligations | ||||||||
| Net liability in the statement of financial position | ||||||||
Movement in plan assets:
| Consolidated | ||||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Balance at the beginning of the year | ||||||||
| Interest income | ||||||||
| Contributions | ||||||||
| Return on plan assets (excluding interest) | ||||||||
| Foreign exchanges differences | ( | ) | ||||||
| Balance at the end of the year | ||||||||
F-30
Note 19. Non-current liabilities - employee benefits (continued)
Reconciliations
| Consolidated | ||||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Reconciliation of the present value of the defined benefit obligation | ||||||||
| Balance at the beginning of the year | ||||||||
| Interest cost | ||||||||
| Current service cost | ||||||||
| Actuarial loss/(gains) from financial assumptions | ( | ) | ( | ) | ||||
| Foreign exchanges differences | ( | ) | ||||||
| Balance at the end of the year | ||||||||
Note 20. Non-current liabilities - Governmental liabilities on grants received
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Governmental liabilities on grants received | ||||||||
Accounting policy for Government liabilities on grants received
The Company measured the value of its governmental liabilities on grants received, each period, based on discounted cash flows derived from Company’s future anticipated revenues.
F-31
Note 20. Non-current liabilities - Governmental liabilities on grants received (continued)
The Company participates in programs sponsored
by the Israeli Innovation Authority- Office of Chief Scientist (“OCS”), for the support of research and development projects.
Several programs are subjected to royalties, while others are not (the Company is committed to pay royalties for the R&D programs,
while the research programs do not require repayment). In exchange for the OCS’s participation in the programs, the Company is
required to pay royalties to the OCS at a rate between
Note 21. Equity - issued capital
| Consolidated | ||||||||||||||||||||||||
| As of December 31, | As of December 31, | As of December 31, | As of December 31, | As of December 31, | As of December 31, | |||||||||||||||||||
| 2025 | 2024 | 2023 | 2025 | 2024 | 2023 | |||||||||||||||||||
| Shares | Shares | Shares | $ | $ | $ | |||||||||||||||||||
| Ordinary shares - fully paid | ||||||||||||||||||||||||
F-32
Note 21. Equity - issued capital (continued)
Movements in ordinary share capital
| Details | Date | Shares | Issue price | $ | ||||||||||
| Balance | December 31, 2022 | |||||||||||||
| Expiry of options | - | |||||||||||||
| Cancelation of shares through small parcel buy back | ( | ) | ( | ) | ||||||||||
| Balance | December 31, 2023 | |||||||||||||
| Issue of shares (net of warrant fair value) under Registered Direct Offering (*) | $ | |||||||||||||
| Exercise of pre-funded warrants and private placement warrants | $ | |||||||||||||
| Capital raising costs | - | - | ( | ) | ||||||||||
| Expiry of options | - | |||||||||||||
| Balance | December 31, 2024 | |||||||||||||
| Issue of ATM sale transactions shares, net of sales agent fees (**) | $ | |||||||||||||
| Issue of shares under service agreement (***) | $ | |||||||||||||
| Exercise of pre-funded warrants and private placement warrants | $ | |||||||||||||
| Exercise of options | $ | |||||||||||||
| Vesting of restricted shares units | - | |||||||||||||
| Capital raising costs | - | ( | ) | |||||||||||
| Reclass of vested restricted share units share-based payments | - | |||||||||||||
| Reclass of exercised options share-based payments | - | |||||||||||||
| Expiry of options | - | |||||||||||||
| Balance | December 31, 2025 | |||||||||||||
(*)
(**) On February 3, 2025, the Company entered into an
At-The-Market Sales Agreement (the “Sales Agreement”) with ThinkEquity LLC, as sales agent (the “Sales Agent”),
pursuant to which the Company may offer and sell, from time to time through the Sales Agent ADSs, having an aggregate offering price
of up to $
As of December 31, 2025, the Company sold
(***)
F-33
Note 21. Equity - issued capital (continued)
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.
Transition from ADS to listed Ordinary share
On August 25, 2022, the Company completed its Nasdaq listing via issuance
of ADSs (American Depository Shares) with
Capital risk management
The Company’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The Company would look to raise capital when an opportunity to invest in a business or company was seen as value adding relative to the current Company’s share price at the time of the investment. The Company is not actively pursuing additional investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.
Accounting policy for issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
F-34
Note 21. Equity - issued capital (continued)
Warrants
The Company accounts for warrants issued to investors in conjunction with IFRS 9 “Financial Instruments” accounting standards issued by IASB.
| (a) | On August 24, 2022, the Company completed its U.S. listing
on the Nasdaq via the issuance of |
In addition, on August 24, 2022, in
connection with the U.S listing, the Company granted a total
During 2025,
The tradable pre-funded warrant and representative warrant are referred herein together as “August 2022 Warrants”. The August 2022 Warrants represent financial liabilities at fair value through profit or loss.
The following assumptions were based on observable market conditions that existed on December 31, 2025 and 2024:
| Assumption | At December 31, 2025 | At December 31, 2024 | ||||||||||||||
| Value methodology | Level 1 | Level 1 | Level 1 | Level 1 | ||||||||||||
| Historical volatility | ||||||||||||||||
| Exercise price | $ | $ | $ | $ | ||||||||||||
| Share price | $ | $ | $ | $ | ||||||||||||
| Risk-free interest rate | ||||||||||||||||
| Dividend yield | ||||||||||||||||
| Fair value per warrant | $ | $ | $ | $ | ||||||||||||
F-35
Note 21. Equity - issued capital (continued)
For the years ended December 31,
2025, 2024 and 2023, the Company recorded fair value losses, net of $
| (b) | On 30 January 2024, the Company completed a registered direct
offering via the issuance of |
During April 2024 and December 2024,
In addition, on 30 January 2024, in a concurrent private
placement, the Company issued to the investors in the registered direct offering warrants to purchase up to an aggregate of
In addition, on 30 January 2024, in connection with the
registered direct offering, the Company granted a total
During December 2024,
During 2025,
The pre-funded warrant, private placement warrants, and placement agent warrant are referred herein together as “January 2024 Warrants”. The January 2024 Warrants represent financial liabilities at fair value through profit or loss.
F-36
Note 21. Equity - issued capital (continued)
The following assumptions were based on observable market conditions that existed on December 31, 2025 and 2024:
| Assumption | At December 31, 2025 | At December 31, 2024 | ||||||||||||||
| Value methodology | Pre-funded Level 2 | Regular Level 2 | Pre-funded Level 2 | Regular Level 2 | ||||||||||||
| Historical volatility | % | % | ||||||||||||||
| Exercise price | $ | $ | ||||||||||||||
| Share price | $ | $ | ||||||||||||||
| Risk-free interest rate | % | % | ||||||||||||||
| Dividend yield | % | % | ||||||||||||||
| Fair value per warrant | $ | $ | ||||||||||||||
For the years ended December 31, 2025, and 2024, the Company
recorded fair value loss, net of and $
F-37
Note 21. Equity - issued capital (continued)
A summary of changes in August 2022 Warrants and January 2024 Warrants issued by the Company during the years ended December 31, 2025, and 2024 is as follows:
| Fair value measurements using input type | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Balance as of January 1, 2024 | $ | $ | ||||||||||||||
| Warrants issued during the period | ||||||||||||||||
| Transfer upon exercise | ( | ) | ( | ) | ||||||||||||
| Fair value loss recognized in consolidated statement of profit or loss and other comprehensive income | ||||||||||||||||
| Warrant liability as of December 31, 2024 | $ | $ | $ | |||||||||||||
| Transfer upon exercise | ( | ) | ( | ) | ( | ) | ||||||||||
| Fair value loss recognized in consolidated statement of profit or loss and other comprehensive income | ||||||||||||||||
| Warrant liability as of December 31, 2025 | $ | $ | ||||||||||||||
Refer to notes 2 and 24 for further information on financial instruments.
Note 22. Equity - reserves
| Consolidated | ||||||||||||
| As of December 31, | As of December 31, | As of December 31, | ||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Foreign currency reserve | ( | ) | ( | ) | ( | ) | ||||||
| Re-measurements of defined benefit plans reserve | ( | ) | ( | ) | ( | ) | ||||||
| ( | ) | ( | ) | ( | ) | |||||||
F-38
Note 22. Equity – reserves (continued)
Foreign currency reserve
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign operations to US dollars.
Re-measurements of defined benefit plans reserves
The reserve is used for remeasurements comprising actuarial gains and losses on the net defined benefit liability.
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
| Re- measurement of defined benefit plans | Foreign currency | |||||||||||
| reserve | reserve | Total | ||||||||||
| Consolidated | $ | $ | $ | |||||||||
| Balance at January 1, 2023 | ( | ) | ( | ) | ( | ) | ||||||
| Re-measurement of defined benefit plans | ||||||||||||
| Re-allocation between accumulated losses and foreign currency reserve | ( | ) | ( | ) | ||||||||
| Translation adjustment due to change in presentation currency | ( | ) | ( | ) | ||||||||
| Balance at December 31, 2023 | ( | ) | ( | ) | ( | ) | ||||||
| Re-measurement of defined benefit plans | ||||||||||||
| Re-allocation between accumulated losses and foreign currency reserve | ( | ) | ( | ) | ||||||||
| Balance at December 31, 2024 | ( | ) | ( | ) | ( | ) | ||||||
| Re-measurement of defined benefit plans | ( | ) | ( | ) | ||||||||
| Re-allocation between accumulated losses and foreign currency reserve | ||||||||||||
| Balance at December 31, 2025 | ( | ) | ( | ) | ( | ) | ||||||
F-39
Note 23. Equity - dividends
There were no dividends paid, recommended or declared during the years ended December 31, 2025, 2024 and 2023.
Note 24. Equity - share-based compensation and share-based payment reserve
The Company has adopted a share incentive plan (the “Plan”) under which it is authorized to grant options and restricted share units to officers, directors, employees and consultants. The options expiration and vesting schedule are as determined by the Board of Directors.
Restricted Share Units (“RSUs”)
On February 15, 2025, the Company issued
The RSUs have no exercise price and no expiry date. The RSUs vests
over a period of
On June 26, 2025, the Company issued
On December 1, 2025, the Company issued
The Company recognized share-based compensation
expense of $
A summary of changes in RSUs options for the years ended December 31, 2025, is presented below:
| Number of RSUs outstanding | ||||
| Balance, January 1, 2025 | ||||
| Granted | ||||
| Vested | ( | ) | ||
| Balance, December 31, 2025 | ||||
F-40
Note 24. Equity - share-based compensation and share-based payment reserve (continued)
Employee Incentive Options
A summary of changes in stock options for the years ended December 31, 2025, 2024 and 2023 is presented below:
| Number of options outstanding | Weighted average exercise price | Weighted average exercise price | ||||||||||
| Balance, January 1, 2023 | AUD$ | $ | ||||||||||
| Granted (i) | ||||||||||||
| Expired (ii) | ( | ) | ||||||||||
| Forfeited (iii) | ( | ) | ||||||||||
| Balance, December 31, 2023 | AUS$ | $ | ||||||||||
| Expired (iv) | ( | ) | ||||||||||
| Forfeited (v) | ( | ) | ||||||||||
| Balance, December 31, 2024 | ||||||||||||
| Granted (vi) | ||||||||||||
| Exercised (vii) | ( | ) | ||||||||||
| Expired (viii) | ( | ) | ||||||||||
| Forfeited (ix) | ( | ) | ||||||||||
| Balance, December 31, 2025 | AUD$ | $ | ||||||||||
F-41
Note 24. Equity - share-based compensation and share-based payment reserve (continued)
| i. | During the year ended December 31, 2023: |
| a. | On May 31, 2023, the Company issued |
| b. | On August 3, 2023, the Company issued |
| ii. |
| iii. |
| iv. |
| v. |
| vi. | During the year ended December 31, 2025: |
| a. | On February 15, 2025, the Company issued |
| b. | On August 21, 2025, the Company issued |
F-42
Note 24. Equity - share-based compensation and share-based payment reserve (continued)
| c. | On December 1, 2025, the Company issued |
| vii. |
| viii. |
| ix. |
| x. | The Company recognized share-based compensation expense of
$ |
| xi. |
| Number of Options | Exercise Price | Exercisable At December 31,2025 | Expiry Date | |||||||||
| AUD$ | ||||||||||||
| AUD$ | ||||||||||||
| AUD$ | ||||||||||||
| AUD | ||||||||||||
| AUD | ||||||||||||
| AUD | ||||||||||||
| AUD | ||||||||||||
| AUD | ||||||||||||
| AUD | ||||||||||||
| AUD | ||||||||||||
As of December 31, 2025, options outstanding have a weighted average
remaining contractual life of
F-43
Note 24. Equity - share-based compensation and share-based payment reserve (continued)
Accounting policy for share-based payments
Equity-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, restricted shares units or options over shares, that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price.
The cost of equity-settled transactions is measured at fair value on grant date. Options fair value is independently determined using the Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the Company receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.
The cost of equity-settled transactions is recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods.
All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to settle the liability.
Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied.
If the non-vesting condition is within the control of the Company or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Company or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification.
F-44
Note 25. Financial instruments
Financial risk management objectives
The Company’s activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and interest rate risk), credit risk and liquidity risk. The Company’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Company. The Company uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate, foreign exchange and other price risks, ageing analysis for credit risk and beta analysis in respect of investment portfolios to determine market risk.
Risk management is carried out by senior finance executives (‘finance’) under policies approved by the Board of Directors (‘the Board’). These policies include identification and analysis of the risk exposure of the company and appropriate procedures, controls and risk limits. Finance identifies, evaluates and hedges financial risks within the Company’s operating units. Finance reports to the Board on a monthly basis.
Market risk
Foreign currency risk
The Company undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk through foreign exchange rate fluctuations.
Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the Company’s functional currency. The risk is measured using sensitivity analysis and cash flow forecasting.
The carrying amount of the Company’s foreign currency denominated financial assets and financial liabilities at the reporting date were as follows (holdings are shown in $ equivalents):
| Assets | Liabilities | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Consolidated | $ | $ | $ | $ | ||||||||||||
| Israeli New Shekel | ||||||||||||||||
| Euros | ||||||||||||||||
| AUD | ||||||||||||||||
Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the Company’s functional currency. The risk is measured using sensitivity analysis.
F-45
Note 25. Financial instruments (continued)
Price risk
Price risk is the risk that future cashflows derived from financial instruments will be changed as a result of a market price movement, other than foreign currency rates and interest rates. The Company is not exposed to any significant price risk.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the company. The Company has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate credit limits. The Company obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The Company does not hold any collateral.
The Company has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables through the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered representative across all customers of the Company based on recent sales experience, historical collection rates and forward-looking information that is available.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a period greater than 1 year.
Liquidity risk
Vigilant liquidity risk management requires the Company to maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.
The Company manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
F-46
Note 25. Financial instruments (continued)
Remaining contractual maturities
The following tables detail the company’s
remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash
flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid.
| 1 year or less | Between 1 and 2 years | Between 2 and 5 years | Over 5 years | Remaining contractual maturities | ||||||||||||||||
| Consolidated - 2025 | $ | $ | $ | $ | $ | |||||||||||||||
| Non-derivatives | ||||||||||||||||||||
| Non-interest bearing | ||||||||||||||||||||
| Trade payables | ||||||||||||||||||||
| Other payables | ||||||||||||||||||||
| Government liabilities | ||||||||||||||||||||
| Total non-derivatives | ||||||||||||||||||||
| 1 year or less | Between 1 and 2 years | Between 2 and 5 years | Over 5 years | Remaining contractual maturities | ||||||||||||||||
| Consolidated - 2024 | $ | $ | $ | $ | $ | |||||||||||||||
| Non-derivatives | ||||||||||||||||||||
| Non-interest bearing | ||||||||||||||||||||
| Trade payables | ||||||||||||||||||||
| Other payables | ||||||||||||||||||||
| Government liabilities | ||||||||||||||||||||
| Total non-derivatives | ||||||||||||||||||||
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. Refer to note 2 for further information on Fair value of financial instruments.
F-47
Note 26. Key management personnel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the Company is set out below:
| Consolidated | ||||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Short-term employee benefits | ||||||||
| Post-employment benefits | ||||||||
| Share-based payments | ||||||||
Note 27. Commitments
There were no commitments for the current or previous financial year.
F-48
Note 28. Related party transactions
Key management personnel
Disclosures relating to key management personnel are set out in note 25.
Receivable from and payable to related parties
The following balances are outstanding at the reporting date in relation to transactions with related parties:
| Consolidated | ||||||||
| As of December 31, | As of December 31, | |||||||
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Current payables: | ||||||||
| Payables to related parties | * | |||||||
| Non-current payables: | ||||||||
| Payables to related parties | * | |||||||
* Reclassed
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
F-49
Note 29. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiary in accordance with the accounting policy described in note 2:
| Ownership interest | ||||||||||
| Name | Principal place of business / Country of incorporation | 2025 % | 2024 % | |||||||
| Mobilicom Ltd (“Mobilicom Israel”) | % | % | ||||||||
| Mobilicom Inc | % | % | ||||||||
Note 30. Reconciliation of loss after income tax to net cash used in operating activities
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Loss after income tax expense for the year | ( | ) | ( | ) | ( | ) | ||||||
| Adjustments for: | ||||||||||||
| Depreciation and amortisation | * | * | ||||||||||
| Share-based payments | ||||||||||||
| Net loss on fair value movement of warrants | ||||||||||||
| Loss on fair value changes for exercised warrants | ||||||||||||
| Foreign exchange differences | ( | )* | ( | )* | ||||||||
| Lease interest | ||||||||||||
| Change in operating assets and liabilities: | ||||||||||||
| Decrease (increase) in trade and other receivables | ( | ) | ||||||||||
| Decrease (increase) in inventories | ( | ) | ||||||||||
| Increase (decrease) in trade and other payables | ( | ) | ||||||||||
| Increase (decrease) in employee benefits | ( | ) | ||||||||||
| Increase (decrease) in Government liabilities | ( | ) | ||||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ( | ) | ||||||
| * |
F-50
Note 31. Earnings (loss) per share
| Consolidated | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| $ | $ | $ | ||||||||||
| Loss after income tax attributable to the owners of the Company | ( | ) | ( | ) | ( | ) | ||||||
| Number | Number | Number | ||||||||||
| Weighted average number of ordinary shares used in calculating basic earnings (loss) per share | * | * | ||||||||||
| Weighted average number of ordinary shares used in calculating diluted earnings (loss) per share | * | * | ||||||||||
| $ Cents | $ Cents | $ Cents | ||||||||||
| Basic earnings (loss) per share | ( | ) | ( | )* | ( | )* | ||||||
| Diluted earnings (loss) per share | ( | ) | ( | )* | ( | )* | ||||||
| * |
The rights to options held by option holders have not been included in the weighted average number of ordinary shares for the purposes of calculating diluted EPS as they do not meet the requirements for inclusion in IAS 133 “Earnings per Share”. The rights to options are non-dilutive as the company is loss generating.
Accounting policy for earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit (loss) attributable to the owners of the Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
F-51
Exhibit 2.1
DESCRIPTION OF SECURITIES
REGISTERED UNDER SECTION 12 OF THE EXCHANGE ACT
The following description of fully paid ordinary shares of Mobilicom Limited (“Ordinary Shares”) is a summary only and is qualified in its entirety by reference to the full text of our Constitution, which is incorporated by reference as an exhibit to our Annual Report on Form 20-F (“Constitution”). We encourage you to read our Constitution in full. The “Company,” “we,” “us,” or “our” refer to Mobilicom Limited and its consolidated subsidiaries.
We are an Australian public company limited by shares registered under the Corporations Act 2001 Cth (“Corporations Act”) by the Australian Securities and Investments Commission (“ASIC”). Our corporate affairs are principally governed by our Constitution, the common law applicable in Australia and the Corporations Act.
In general, our Constitution addresses similar matters to those typically addressed in a U.S. company’s charter documents. Notably, however, we do not have a limit on our authorized share capital, the concept of par value is not recognized under Australian law and we may at any time convert an ordinary share into a preference share and may convert a preference share into an ordinary share (however, the Corporations Act requires that we obtain shareholder approval in connection with such a conversion).
Subject to restrictions on the issue of securities in our Constitution and the Corporations Act and any other applicable law, we may at any time issue shares and grant options or warrants on any terms, with the rights and restrictions and for the consideration that our board of directors determine.
The rights and restrictions attaching to ordinary shares are derived through a combination of our Constitution, the common law applicable to Australia and the Corporations Act and other applicable law. A general summary of some of the rights and restrictions attaching to our ordinary shares are summarized below. Each ordinary shareholder is entitled to receive notice of, and to be present, vote and speak at, general meetings.
Types and Class of Securities
Our outstanding share capital consists of only Ordinary Shares. As noted above, Ordinary Shares are of no par value.
The rights attaching to our Ordinary Shares are detailed in our Constitution. Our Constitution provides that our directors may issue shares with preferred, deferred or other special rights, whether in relation to dividends, voting, return of share capital, or otherwise as our board of directors may determine. Subject to any approval which is required from our shareholders under the Corporations Act (see “Item 16G—Corporate Governance”), any rights and restrictions attached to a class of shares, we may issue further shares on such terms and conditions as our board of directors resolve. Currently, our outstanding share capital consists of only one class of ordinary shares.
Our Constitution allows us at any time convert an ordinary share into a preference share and to convert a preference share into an ordinary share, subject in each case to the terms of issue of those shares, or to issue preference shares with terms different from those of Ordinary Shares; however, the Corporations Act requires that we obtain shareholder approval in connection with such a conversion to, or issue of, preference shares.
Pre-emptive rights
Ordinary Shares and ordinary shareholders do not have pre-emptive rights.
Transfer
There are no inherent restrictions on the transfer of Ordinary Shares.
Dividend rights
Our board of directors may from time to time determine to pay dividends to shareholders. All dividends unclaimed for one year after having been declared may be invested or otherwise made use of by our board of directors for our benefit until claimed or otherwise disposed of in accordance with our Constitution. There have been no dividends paid to ordinary shareholders to date.
Voting rights
Under our Constitution, and subject to any voting prohibitions imposed under the Corporations Act (which typically exclude parties from voting on resolutions in which they have an interest), a poll may be conducted in respect of each resolution other than a procedural resolution put to a meeting of shareholders at the direction of the Chair of the meeting. On a poll vote, each shareholder shall have one vote for each fully paid share and a fractional vote for each share held by that shareholder that is not fully paid, such fraction being equivalent to the proportion of the amount that has been paid to such date on that share. The current Otherwise, voting will be conducted on a show of hands. On a show of hands, each shareholder present has one vote. As noted above, a vote on a show of hands is only provided for under the Constitution in respect of procedural resolutions.
Shareholders may vote in person or by proxy, attorney or representative. Under Australian law, shareholders of a public company are not permitted to approve corporate matters by written consent. Our Constitution does not provide for cumulative voting.
Under Australian law, an ordinary resolution is passed if a majority of the votes cast on the resolution (in person or by proxy) by members entitled to vote on the resolution are in favor of the resolution. Under Australian law, a special resolution is passed if at least 75% of the votes cast on the resolution (in person or by proxy) by members entitled to vote on the resolution are in favor of the resolution.
Rights to share in our profits
Pursuant to our Constitution, our shareholders are entitled to participate in our profits only by payment of dividends. Our board of directors may from time to time determine to pay dividends to the shareholders; however, no dividend is payable except in accordance with the thresholds set out in the Corporations Act.
Surplus in the event of liquidation
Our Constitution provides for the right of shareholders to participate in a surplus in the event of our liquidation, subject to the rights attaching to a class of shares.
No Redemption Provision for Ordinary Shares
There are no redemption provisions in our Constitution in relation to Ordinary Shares. Under our Constitution, any preference shares may be issued on the terms that they are, or may at our option be, liable to be redeemed.
No sinking fund provisions
There are no sinking fund provisions in our Constitution in relation to Ordinary Shares.
Variation or Cancellation of Share Rights
Subject to the terms of issue of shares of that class, the rights attached to shares in a class of shares may only be varied or cancelled by:
| ● | a special resolution passed at a separate general meeting of members holding shares in the class; or |
| ● | the written consent of members with at least 75% of the shares in the class. |
2
Directors May Make Calls
Our Constitution provides that subject to the terms on which the shares have been issued directors may make calls on a shareholder for amounts unpaid on shares held by that shareholder, other than monies payable at fixed times under the conditions of allotment. We do not currently have any partly paid shares on issue, all shares are fully paid ordinary shares.
General Meetings of Shareholders
General meetings of shareholders may be called by our board of directors. Except as permitted under the Corporations Act, shareholders may not convene a meeting. The Corporations Act requires the directors to call and arrange to hold a general meeting on the request of shareholders with at least 5% of the votes that may be cast at a general meeting. Notice of the proposed meeting of our shareholders is required at least 28 clear days prior to such meeting under the Corporations Act and our Constitution.
We must hold an annual general meeting within five months of the end of each fiscal year. Our end of fiscal year is currently 31 December each year. At the annual general meeting, shareholders typically consider the annual financial report, directors’ report and auditor’s report and vote on matters, including the election of directors. We may also hold other meetings of shareholders from time to time. The annual general meeting must be held in addition to any other meetings which we may hold.
Limitations on Rights to own Shares
There are no limitations on the rights of non-Australian entities to own securities imposed by our Constitution. However, acquisitions and proposed acquisitions of securities in Australian companies may be subject to review and approval by the Australian Federal Treasurer under the Foreign Acquisitions and Takeovers Act 1975 and the Foreign Acquisition and Takeovers Regulations 2015, or the FATA, which generally applies to acquisitions or proposed acquisitions:
| ● | by a foreign person or their associates (as defined in the FATA) of a direct interest (generally constituted by an interest of 10% or more) in a company which operates a business that meets the criteria of a ‘national security business’ regardless of value; |
| ● | by ‘foreign government investors’ (as defined in the FATA) acquiring a direct interest (generally constituted by an interest of 10% or more) in a company regardless of value; |
| ● | by a foreign person (as defined in the FATA) or associated foreign persons that would result in such persons having an interest in 20% or more of the issued shares of, or control of 20% or more of the voting power in, an Australian company; and |
| ● | by two or more non-associated foreign persons that would result in such foreign person having an interest in 40% or more of the issued shares of, or control of 40% or more of the voting power in, an Australian company, where the Australian company is valued above the monetary threshold prescribed by FATA (as set out above). |
However, no such review or approval under the FATA is required if the foreign acquirer is a U.S. entity and the value of the target is less than AUD$1,216 million.
The above should be considered an overview only. The application of the FATA is complex and requires an assessment of the circumstances and nature of a particular investment. For example, varying rules exist for acquisitions in agricultural land or businesses deemed to be ‘sensitive businesses’.
The Australian Federal Treasurer may prevent a proposed acquisition in the above categories or impose conditions on such acquisition if the Treasurer is satisfied that the acquisition would be contrary to the national interest. If a foreign person acquires shares or an interest in shares in an Australian company in contravention of the FATA, the Australian Federal Treasurer may order the divestiture of such person’s shares or interest in shares in that Australian company. There are also civil and criminal penalties which may apply to breaches of the FATA.
In addition, if we were to become a ‘foreign person’ for the purposes of the FATA we would be required to obtain the approval of the Australian Treasurer to undertake certain acquisitions of Australian entities or businesses.
3
Provision affecting any change of control
Subject to our Constitution, the Corporations Act and any other applicable law, we may at any time issue shares and grant options or warrants on any terms, with preferred, deferred or other special rights and restrictions and for the consideration and other terms that the directors determine.
Subject to the requirements of our Constitution, the Corporations Act and any other applicable law, including relevant shareholder approvals, we may consolidate or divide our share capital into a larger or smaller number by resolution, reduce our share capital (provided that the reduction is fair and reasonable to our shareholders as a whole and does not materially prejudice our ability to pay creditors) or buy back our ordinary shares whether under an equal access buy-back or on a selective basis.
Change of Control
Takeovers of listed Australian public companies, such as Mobilicom are regulated by the Corporations Act, which prohibits the acquisition of a “relevant interest” in issued voting shares in a listed company if the acquisition will lead to that person’s or someone else’s voting power in Mobilicom (when aggregated with their “associates”) increasing from 20% or below to more than 20% or increasing from a starting point that is above 20% and below 90%, subject to a range of exceptions.
Generally, a person will have a relevant interest in securities if the person:
| ● | is the holder of the securities; |
| ● | has power to exercise, or control the exercise of, a right to vote attached to the securities; or |
| ● | has the power to dispose of, or control the exercise of a power to dispose of, the securities, including any indirect or direct power or control. |
If, at a particular time, a person has a relevant interest in issued securities and the person:
| ● | has entered or enters into an agreement with another person with respect to the securities; |
| ● | has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, in relation to the securities (whether the right is enforceable presently or in the future and whether or not on the fulfillment of a condition); |
| ● | has granted or grants an option to, or has been or is granted an option by, another person with respect to the securities; or |
| ● | the other person would have a relevant interest in the securities if the agreement were performed, the right enforced or the option exercised; |
the other person is taken to already have a relevant interest in the securities.
4
There are a number of exceptions to the above prohibition on acquiring a relevant interest in issued voting shares above 20%. In general terms, some of the more significant exceptions include:
| ● | when the acquisition results from the acceptance of an offer under a formal takeover bid; |
| ● | when the acquisition is conducted on market by or on behalf of the bidder under a takeover bid, the acquisition occurs during the bid period, the bid is for all the voting shares in a bid class and the bid is unconditional or only conditioned on prescribed matters set out in the Corporations Act; |
| ● | when shareholders of Mobilicom approve the takeover by resolution passed at general meeting; |
| ● | an acquisition by a person if, throughout the six months before the acquisition, that person or any other person has had voting power in Mobilicom of at least 19% and, as a result of the acquisition, none of the relevant persons would have voting power in Mobilicom more than three percentage points higher than they had six months before the acquisition; |
| ● | when the acquisition results from the issue of securities under a rights issue; |
| ● | when the acquisition results from the issue of securities under dividend reinvestment schemes; |
| ● | when the acquisition results from the issue of securities under underwriting arrangements; |
| ● | when the acquisition results from the issue of securities through operation of law; |
| ● | an acquisition that arises through the acquisition of a relevant interest in another listed company which is listed on a prescribed financial market or a financial market approved by ASIC; |
| ● | an acquisition arising from an auction of forfeited shares conducted on-market; or |
| ● | an acquisition arising through a compromise, arrangement, liquidation or buy-back. |
Breaches of the takeovers provisions of the Corporations Act are criminal offenses. ASIC and the Australian Takeover Panel have a wide range of powers relating to breaches of takeover provisions, including the ability to make orders canceling contracts, freezing transfers of, and rights attached to, securities, and forcing a party to dispose of securities. There are certain defenses to breaches of the takeover provisions provided in the Corporations Act. Our Constitution also contains a requirement for our shareholders to approve any proportionate takeover bid (i.e., a bid for a specified proportion of a class of securities) without the approval of a majority of our shareholders voting at a general meeting (refer Article 28 of the Constitution). For these provisions to be effective they must be approved by shareholders at a general meeting at least every three years. The renewal of these provisions has not, however, been approved by shareholders in the last three years and accordingly the provisions with respect to proportional takeover bids contained in our Constitution have lapsed. Shareholders may however approve renewal of these provisions in future, which may have the effect of discouraging proportionate takeover bids and limit our shareholders’ opportunity to obtain a premium for their securities from such a transaction.
Ownership threshold
There are no provisions in our Constitution that require a shareholder to disclose ownership above a certain threshold. Upon becoming a U.S. public company, our shareholders will also be subject to disclosure requirements under U.S. securities laws.
5
Differences between the Law of Different Jurisdictions
See “Rights of the Shares” above. The Australian law applicable to our Constitution is not significantly different than a U.S. company’s charter documents except we do not have a limit on our authorized share capital, the concept of par value is not recognized under Australian law and we may at any time convert an ordinary share into a preference share and may convert a preference share into an ordinary share (however, the Corporations Act requires that we obtain shareholder approval in connection with such a conversion).
Issues of Shares and Changes in Capital
Subject to our Constitution, the Corporations Act and any other applicable law, we may at any time issue shares and grant options or warrants on any terms, with preferred, deferred or other special rights and restrictions and for the consideration and other terms that the directors determine.
Subject to the requirements of our Constitution, the Corporations Act and any other applicable law, including relevant shareholder approvals, we may consolidate or divide our share capital into a larger or smaller number by resolution, reduce our share capital (provided that the reduction is fair and reasonable to our shareholders as a whole and does not materially prejudice our ability to pay creditors) or buy back our ordinary shares whether under an equal access buy-back or on a selective basis.
6
Exhibit 4.19
Deed
| Director’s deed of indemnity, insurance and access | |
| Mobilicom Limited ACN 617 155 978 | |
| Yossi Segal |
Contents
Table of contents
| 1 | Definitions, interpretation and deed components | 2 | |
| 1.1 | Definitions | 2 | |
| 1.2 | Interpretation | 4 | |
| 1.3 | Interpretation of inclusive expressions | 5 | |
| 1.4 | Business Day | 5 | |
| 1.5 | Deed components | 5 | |
| 2 | Access to Board Papers | 5 | |
| 2.1 | Company to keep records | 5 | |
| 2.2 | Director may access and use Board Papers | 5 | |
| 2.3 | Confidentiality and privilege | 6 | |
| 3 | Indemnity to Director | 7 | |
| 3.1 | Indemnity | 7 | |
| 3.2 | Continuing indemnity | 7 | |
| 3.3 | Advance of defence costs | 7 | |
| 3.4 | Repayment | 7 | |
| 3.5 | Conduct of proceedings | 7 | |
| 3.6 | Legal representation | 8 | |
| 4 | D&O Policy | 9 | |
| 4.1 | Company to maintain D&O Policy | 9 | |
| 4.2 | Terms of D&O Policy | 9 | |
| 4.3 | Director’s obligations | 10 | |
| 5 | General | 10 | |
| 5.1 | Governing law and jurisdiction | 10 | |
| 5.2 | Notices | 10 | |
| 5.3 | Invalidity and enforceability | 10 | |
| 5.4 | Exclusion of moratoria | 10 | |
| 5.5 | Variation | 10 | |
| 5.6 | Waiver | 11 | |
| 5.7 | Further action | 11 | |
| 5.8 | Stamp duty | 11 | |
| 5.9 | Other rights | 11 | |
| 5.10 | Tax on payments | 11 | |
| 5.11 | Entire agreement | 11 | |
| 5.12 | No reliance | 11 | |
| 5.13 | Counterparts | 11 | |
| 5.14 | Relationship of the parties | 11 | |
| 5.15 | Exercise of rights | 11 | |
| Signing page | 12 | ||
[Director’s deed/deed of indemnity, insurance and access]
Contents 1
| Director’s deed of indemnity, insurance and access | |
| Date ► 27 April 2017 | |
| Between the parties | |
| Company | Mobilicom Limited ACN 617 155 978 c/- Quinert Rodda & Associates Pty Ltd, Suite 1, Level 6, 50 Queen Street, Melbourne VIC 3000 (Company) |
| Director | Yossi Segal of Ehud Manor 4, Apartment 29, Holon, Israel or address as advised from time to time (Director) |
Recitals
| 1 | The Constitution provides that the Company: |
| ● | must indemnify directors to the full extent permitted by law; and |
| ● | may enter into contracts of insurance to protect directors against any liability incurred by directors as directors of the Company. |
| 2 | The Corporations Act provides that the Company must provide directors with access to certain Company documents. |
| 3 | The Director will be appointed as a director of the Company with effect from the Appointment Date. |
| 4 | In accordance with the Constitution and the Corporations Act and in consideration of the Director agreeing to act as a director of the Company, the Company has agreed to: |
| ● | provide access to Board Papers; |
| ● | indemnify the Director against liabilities incurred while acting as a director of the Company; and |
| ● | maintain a D&O Policy, on the terms contained in this deed. |
[Director’s deed/deed of indemnity, insurance and access]
page 1
This deed witnesses as follows:
| 1 | Definitions, interpretation and deed components |
| 1.1 | Definitions |
The meanings of the terms used in this deed are set out below.
| Term | Meaning |
| Access Period |
in relation to the Company and each Relevant Company (as the case may be) the period commencing on the Appointment Date and ending on the later of:
1 the date which is 7 years after the Director ceases to hold office as a director of the Company or the Relevant Company (as the case may be); and
2 he date any Relevant Proceedings commenced (and notified by the Director to the Company) during the period specified in item 1 have been finally resolved. |
| Appointment Date | the date the Director commences acting as a director of the Company. |
| Board | the board of directors of the Company. |
| Board Papers |
in relation to the Company:
1 all material provided to the Director, to the board or to any committee of the board (Material), whether in documentary form or some other form, including, but not limited to, board papers, submissions, minutes, memoranda, legal opinions, financial statements and subcommittee papers; and
2 all documents of the Company or to which the Company is a party where those documents are referred to in any Material, during the Relevant Period. and, in relation to each Relevant Company:
1 all material provided to the Director in his/her capacity as a director of the Relevant Company, to the board of the Relevant Company or to any committee of the board of the Relevant Company, whether in documentary form or some other form, including, but not limited to, board papers, submissions, minutes, memoranda, legal opinions, financial statements and subcommittee papers; and
2 all documents of the Relevant Company or to which the Relevant Company is a party where those documents are referred to in any such material. |
[Director’s deed/deed of indemnity, insurance and access]
page 2
1. Definitions, interpretation and deed components
| Term | Meaning |
| Business Day | a day on which banks are open for business in MelbourneVictoria other than a Saturday, Sunday or a public holiday in that city. |
| claim | any writ, summons, claim, cross claim, counterclaim, application, examination, allegation, cause of action, suit or demand of any nature whatsoever, other originating legal or arbitral process, proceeding, investigation or inquiry or hearing by any Governmental Agency, arising out of or in any way connected to any act or omission by the Director, or any written or oral threat that might reasonably result in the Director apprehending that any such proceedings would be initiated. |
| Constitution | the Company’s constitution at the date of this deed. |
| Corporations Act | the Corporations Act 2001 (Cth). |
| D&O Policy | a policy of insurance provided and maintained by the Company insuring the Director (among others) against liability as a director and officer of the Company and its subsidiaries. |
| Director | has the meaning given in section 9 of the Corporations Act. |
| Document | has the meaning given to it for the purposes of the Corporations Act. |
| Government Agency | any government or governmental, administrative, monetary, fiscal, or judicial body, department, commission, authority, tribunal, agency or entity in any part of the world. |
| liability | a liability of any kind including damages, costs, fees and expenses and any applicable taxes levied in respect of that liability. |
| officer | includes any director and any senior manager of the Company and its related bodies corporate. |
| related body corporate | has the meaning given to it for the purposes of the Corporations Act. |
| Relevant Company | each related body corporate of the Company of which the Director is a director from time to time. |
[Director’s deed/deed of indemnity, insurance and access]
page 3
1. Definitions, interpretation and deed components
| Term | Meaning |
| Relevant Period | the period commencing on the Appointment Date and ending on the date the Director ceases to act as a director of the Company or Relevant Company (as the case may be). |
| Relevant Proceedings |
in relation to the Director:
1 any hearing, conference, dispute, inquiry or investigation of a court, arbitrator, mediator, tribunal or governmental or administrative body; and
2 any procedural step preceding or otherwise relating to such a hearing, conference, dispute, inquiry or investigation,
in which the Director is involved as a party or potential party because the Director is or was a director of the Company or Relevant Company (as the case may be) in the Relevant Period. |
| senior manager | has the meaning given to it for the purposes of the Corporations Act. |
| 1.2 | Interpretation |
In this deed:
| (a) | headings and bold type are for convenience only and do not affect the interpretation of this deed; |
| (b) | the singular includes the plural and the plural includes the singular; |
| (c) | words of any gender include all genders; |
| (d) | other parts of speech and grammatical forms of a word or phrase defined in this deed have a corresponding meaning; |
| (e) | an expression importing a person includes any company, partnership, joint venture, association, corporation or other body corporate and any Government Agency as well as an individual; |
| (f) | a reference to any thing (including, but not limited to, any right) includes a part of that thing; |
| (g) | a reference to any legislation includes all delegated legislation made under it and amendments, consolidations, replacements or re-enactments of any of them; |
| (h) | a reference to a clause, party, schedule, attachment or exhibit is a reference to a clause of, and a party, schedule, attachment or exhibit to, this deed; |
| (i) | a reference to a body, other than a party to this deed (including an institute, association or authority), whether statutory or not: |
| (1) | which ceases to exist; or |
| (2) | whose powers or functions are transferred to another body, is a reference to the body which replaces it or which substantially succeeds to its powers or functions; |
| (j) | a promise on the part of 2 or more persons binds them jointly and severally; |
[Director’s deed/deed of indemnity, insurance and access]
page 4
2. Access to Board Papers
| (k) | a provision of this deed may not be construed adversely to a party solely on the ground that the party was responsible for the preparation of this deed or that provision; |
| (l) | a reference to a party to a document includes that party’s successors and permitted assignees; and |
| (m) | a reference to the Director includes the estate, heirs and legal representatives of any deceased or mentally incompetent Director. |
| 1.3 | Interpretation of inclusive expressions |
Specifying anything in this deed after the words ‘include’ or ‘for example’ or similar expressions does not limit what else is included.
| 1.4 | Business Day |
Where the day on or by which any thing is to be done is not a Business Day, that thing must be done on or by the next Business Day.
| 1.5 | Deed components |
This deed includes any schedule.
| 2 | Access to Board Papers |
| 2.1 | Company to keep records |
| (a) | Subject to clause 2.1(b), the Company must keep and must use all reasonable endeavours to procure that each Relevant Company of which the Director is a director keep a complete set of Board Papers, in a systematic and organised manner, in secure custody during the Access Period. |
| (b) | Where Board Papers were brought into existence before the date of this deed, the Company complies with its obligations under clause 2.1(a) if it uses all reasonable endeavours to collate and keep, and if it uses all reasonable endeavours to procure each Relevant Company to collate and keep, those Board Papers in the manner required by clause 2.1(a). |
| 2.2 | Director may access and use Board Papers |
| (a) | Subject to clauses 2.2(b) and 2.2(e), if the Director asks to inspect, or for a copy of, a Board Paper of the Company or a Relevant Company during the Access Period and the request is made in connection with Relevant Proceedings or the threat of Relevant Proceedings, the Company must, as soon as practicable after receiving that request: |
| (1) | where the request relates to a Board Paper of the Company, allow the Director (or a person nominated in writing by the Director) to inspect the Board Paper at the Company’s registered office (or any other place agreed by the Company and the Director) and give the Director a copy of the Board Paper without charge; |
| (2) | where the request relates to a Board Paper of a Relevant Company, use all reasonable endeavours to procure the Relevant Company to take the steps contemplated by clause 2.2(a)(1). |
[Director’s deed/deed of indemnity, insurance and access]
page 5
2. Access to Board Papers
| (b) | The Director acknowledges that the Company or Relevant Company (as the case may be): |
| (1) | remains the owner of all Board Papers; and |
| (2) | may request the Director to provide the Company or Relevant Company with reasons why the Director requires access to a document. |
| (c) | The Director must, on written request by the Company or Relevant Company (as the case may be), provide the Company or Relevant Company with written reasons why the Director requires access to a document; and |
| (d) | The Director must return to the Company or Relevant Company or destroy all copies of any Board Paper obtained from the Company or Relevant Company under this clause 2.2 within 10 Business Days after the Relevant Proceedings are finally resolved or the threat of Relevant Proceedings has ceased to materially exist. |
| (e) | If the Company or Relevant Company (as the case may be) has any right (including a right it has jointly or in common with the Director or with the Directors and others) to privilege, such as legal professional privilege, in respect of any document which the Director inspects, copies or uses under this deed or under the Corporations Act or under the general law rights of a director: |
| (1) | that document is to be taken to be confidential; |
| (2) | by permitting the inspection, copying or use to the Director or the Director’s permitted nominee, the Company does not waive any privilege; and |
| (3) | in so inspecting, copying or using the document by himself or herself or through the Director’s permitted nominee, the Director must use best efforts to ensure that so far as is practical the right to privilege is not lost or waived, whether by the Director or the Director’s nominee or otherwise. |
Nothing in this deed or done pursuant to this deed prevents the Company or Relevant Company (as the case may be) from relying on privilege in proceedings between the Director and the Company or Relevant Company (including in respect of a document which the Company or Relevant Company has disclosed to the Director outside those proceedings).
| (f) | The Company acknowledges, and on behalf of each Relevant Company acknowledges, that monetary damages alone would not be adequate compensation to the Director for the Company’s or Relevant Company’s (as the case may be) breach of its obligations under this clause 2.2 and that accordingly specific performance of those obligations is an appropriate remedy. |
| (g) | This clause 2.2 does not limit any right of access the Director otherwise has to Board Papers. |
| 2.3 | Confidentiality and privilege |
| (a) | The Director must not disclose any confidential information contained in a Board Paper to a third party unless: |
| (1) | the Company or Relevant Company (as the case may be) has given its prior written consent; |
| (2) | the Director is required to do so by law; |
| (3) | the disclosure is made for the purpose of obtaining professional advice; or |
| (4) | the disclosure is made in connection with the Relevant Proceedings or the threat of Relevant Proceedings in relation to which the Director was given access to the Board Paper, |
and the Director uses the Director’s best endeavours to ensure all information disclosed is kept confidential.
[Director’s deed/deed of indemnity, insurance and access]
page 6
3. Indemnity to Director
| (b) | Nothing in clause 2.3(a) is intended to replace or reduce the duties which the Director may have, at law, to the Company or a related body corporate. |
| (c) | Where the Director is entitled to disclose confidential information under clause 2.3(a) and the Board Papers include any information to which legal professional privilege attaches for the benefit of the Company or Relevant Company (as the case may be), or both the Company or Relevant Company and the Director, the Director must use the Director’s best endeavours to avoid doing anything that will cause that privilege to be waived, extinguished or lost by the Company or Relevant Company in relation to third parties. |
| 3 | Indemnity to Director |
| 3.1 | Indemnity |
The Company must indemnify the Director, on a full indemnity basis and to the full extent permitted by law, against all losses or liabilities (including all reasonable legal costs) incurred by the Director as an officer of the Company or of a related body corporate.
| 3.2 | Continuing indemnity |
The indemnity in clause 3.1 is an irrevocable, unconditional, continuing and principal obligation of the Company despite:
| (a) | the resignation or removal of the Director as a director of the Company; |
| (b) | the settlement of any dispute between the Director and the Company or a third party; or |
| (c) | the occurrence of any other thing, |
and remains in full force and effect until released by the Director.
| 3.3 | Advance of defence costs |
| (a) | The Company, on the Director’s request, will advance to the Director reasonable costs incurred or expected to be incurred by the Director (whether legal or otherwise) in defending Relevant Proceedings. Any such advance will be interest free. |
| (b) | The Director must furnish the Company with invoices or other relevant evidence of the costs incurred for the purposes of clause 3.3(a). |
| (c) | If the Company has advanced an amount for costs under clause 3.3(a), the amount of the advance will be in part satisfaction of the Company’s obligation to indemnify the Director and will cease to be repayable unless it is subsequently found that the Director was not entitled to be indemnified for those costs. |
| 3.4 | Repayment |
If the Company has paid an amount under clause 3.1 or advanced an amount for costs under clause 3.3(a) and it is subsequently found that the Director is not entitled to be indemnified for or advanced those costs, the Director must repay the amount of the payment to the Company within 90 days of a request by the Company.
| 3.5 | Conduct of proceedings |
| (a) | The Company may do one or more of the following: |
| (1) | assume the conduct, negotiation or defence of a claim; |
[Director’s deed/deed of indemnity, insurance and access]
page 7
3. Indemnity to Director
| (2) | institute a cross claim or a counterclaim in relation to a claim; and |
| (3) | subject to clause 3.6, retain lawyers in relation to a claim to act on behalf of both the Director and the Company, and, when it does so, the conduct of the claim will be under the sole management and control of the Company or its insurers (acting reasonably). |
| (b) | The Director must: |
| (1) | give notice to the Company promptly on becoming aware of any claim or any circumstances which could reasonably be expected to give rise to any claim against the Director that may give rise to a right to be indemnified under this deed; |
| (2) | take any reasonable action that the Company requests to avoid, dispute, resist, bring an appeal in, compromise or defend any claim or any adjudication of a claim; |
| (3) | not make any admission of liability or payment in respect of or settle or compromise any claim without the Company’s prior written consent; |
| (4) | on request by the Company, render all reasonable assistance and co-operation to the Company in the conduct of any claim, including, but not limited to, giving the Company any documents, authorities and directions that the Company reasonably requires to prosecute or advance any cross claim or counterclaim in relation to a claim; and |
| (5) | on request by the Company, do anything reasonably necessary or desirable to enable the Company (so far as possible) to be subrogated to and enjoy the benefits of the Director’s rights in relation to any cross claims or any claims against any third party (including any claim under any applicable D&O policy) and render any assistance that is reasonably requested by the Company for that purpose, and the Company is not obliged to indemnify the Director under this deed or otherwise where the Director fails to perform any of these obligations. |
| (c) | The Director is entitled to be reimbursed by the Company the actual costs of the Director reasonably incurred in taking action or providing assistance under clause 3.5(b). |
| (d) | In acting under clause 3.5(a), the Company must, subject to any requirement of its insurers, have regard to the principle that the reputation of the Director should not be injured unreasonably. |
| (e) | If the Company does not elect to take control of the conduct of proceedings under clause 3.5(a), the Director must ensure that the Company is kept fully informed of any actual or proposed developments (including, without limitation, any meetings) and is provided with copies of all material correspondence and documentation relating to such third party claim or action, and such other information, assistance and access to records and personnel as the Company reasonably requires. |
| 3.6 | Legal representation |
The Director may engage separate legal or other representation and participate in a claim or proceeding against the Director as a result of or arising from being a director of the Company or a related body corporate. The Company will pay any expenses incurred by the Director in relation to the representation or participation only to the extent that those expenses are:
| (a) | incurred before the Company assumes conduct of the claim; |
| (b) | incurred with the Company’s prior written authority; or |
[Director’s deed/deed of indemnity, insurance and access]
page 8
4. D&O Policy
| (c) | reasonable and incurred in circumstances where: |
| (1) | the Company has refused to authorise representation or participation by lawyers other than lawyers acting also for the Company; and |
| (2) | there is a reasonable likelihood that the interests of the Director and of the Company would conflict if the same lawyers were to act on behalf of both the Director and the Company. |
| 4 | D&O Policy |
| 4.1 | Company to maintain D&O Policy |
| (a) | Subject to clause 4.2, the Company must maintain a D&O Policy from the date of this deed until the end of the Access Period. |
| (b) | To the extent required to comply with its disclosure obligations in relation to the D&O Policy, the Company will seek information from the Director within a reasonable period before the renewal of the policy. |
| 4.2 | Terms of D&O Policy |
The Company must:
| (a) | to the extent that such a policy is available from a reputable insurance company at reasonable commercial rates, ensure that the D&O Policy: |
| (1) | is at least as comprehensive as those available from reputable and financially secure insurance companies containing the kinds of terms, conditions, exclusions and additional cover commonly included in a directors and officers insurance policy of the kind effected by companies in the same industry as the Company that have a comparable market capitalisation, size and nature of operations and a similar financial status to the Company and a desire to protect directors and former directors to the maximum extent that is reasonable in the circumstances; and |
| (2) | is at least as comprehensive as those available from reputable and financially secure insurance companies containing the kinds of terms, conditions, exclusions and additional cover commonly included in a directors and officers insurance policy that is appropriate in view of the potential liabilities of the Director (which will require consideration of the activities of and potential liabilities incurred by the Company at the time the Director was a director of the Company); and |
| (3) | is at least as comprehensive as the directors and officers insurance policy effected for the benefit of the existing directors of the Company from time to time during the Access Period; |
| (b) | to the maximum extent permitted by law, pay the cost of any premiums under the D&O Policy; |
| (c) | to the extent that any part of the premium for the D&O Policy may not by law be paid by the Company, give the Director notice of and a reasonable opportunity to contribute that part of the additional premium which is attributable to the Director (if required for the policy to be effective); and |
| (d) | at the request of the Director, give the Director a copy of the D&O Policy and a certificate of currency in respect of the D&O Policy. |
[Director’s deed/deed of indemnity, insurance and access]
page 9
5. General
| 4.3 | Director’s obligations |
| (a) | To the extent required to comply with its disclosure obligations in relation to the D&O Policy, the Director will provide the Company with the information requested by it within a reasonable period before the renewal of the policy. |
| (b) | Nothing in this deed modifies or limits any obligation of the Director under the terms of any applicable D&O Policy. Furthermore, the terms of this deed shall not negate any obligation that the Director might have to assist the Company in complying with any obligations it may have under the terms of such D&O Policy and the Director must not take or fail to take any action which may prejudice the ability of the Company to recover under any such D&O Policy. |
| 5 | General |
| 5.1 | Governing law and jurisdiction |
| (a) | This deed is governed by the law in force in Victoria. |
| (b) | Each party irrevocably submits to the non-exclusive jurisdiction of courts exercising jurisdiction in Victoria and courts of appeal from them in respect of any proceedings arising out of or in connection with this deed. Each party irrevocably waives any objection to the venue of any legal process in these courts on the basis that the process has been brought in an inconvenient forum. |
| 5.2 | Notices |
Any notice or other communication to or by a party to this deed:
| (a) | must be in legible writing addressed as shown at the commencement of this deed or as specified to the sender by any party by notice; and |
| (b) | may be delivered by hand or sent by prepaid post or facsimile transmission. |
| 5.3 | Invalidity and enforceability |
| (a) | If any provision of this deed is invalid under the law of any jurisdiction the provision is enforceable in that jurisdiction to the extent that it is not invalid, whether it is in severable terms or not. |
| (b) | Clause 5.3(a) does not apply where enforcement of the provision of this deed in accordance with clause 5.3(a) would materially affect the nature or effect of the parties’ obligations under this deed. |
| 5.4 | Exclusion of moratoria |
Any statute, moratorium or other governmental order that prejudicially affects the rights, powers or discretions of the parties under this deed does not apply to this deed unless application is mandatory.
| 5.5 | Variation |
A variation of any term of this deed must be in writing and signed by the parties.
[Director’s deed/deed of indemnity, insurance and access]
page 10
5. General
| 5.6 | Waiver |
| (a) | A party waives a right under this deed only if it does so in writing. |
| (b) | A party does not waive a right simply because it: |
| (1) | fails to exercise the right; |
| (2) | delays exercising the right; or |
| (3) | only exercises part of the right. |
| (c) | A waiver of one breach of a term of this deed does not operate as a waiver of another breach of the same term or any other term. |
| 5.7 | Further action |
Each party must do all things and execute all further documents necessary to give full effect to this deed.
| 5.8 | Stamp duty |
The Company must pay any stamp duty chargeable on this deed.
| 5.9 | Other rights |
Nothing in this deed limits or restricts any other right of indemnity or other exoneration or protection available to the Director independently of this deed, whether under general or statutory law or otherwise, including arising from a relationship of employment with the Company but nothing in this deed requires the Company to pay more than once in respect of any claim.
| 5.10 | Tax on payments |
If payment is due to the Director under this deed (Payment) and its receipt or derivation gives rise to a liability for tax (including income or goods and services tax) on or payable by the Director, the Company must increase the Payment by the amount necessary to ensure that, after payment of the tax, the balance remaining to the Director is equal to the amount of the Payment.
| 5.11 | Entire agreement |
This deed states all the express terms agreed by the parties in respect of its subject matter. It supersedes all prior discussions, negotiations, understandings and agreements in respect of its subject matter.
| 5.12 | No reliance |
Neither party has relied on any statement by the other party not expressly included in this deed.
| 5.13 | Counterparts |
This deed may be executed in any number of counterparts.
| 5.14 | Relationship of the parties |
| (a) | Nothing in this deed gives a party authority to bind any other party in any way. |
| (b) | Nothing in this deed imposes any fiduciary duties on a party in relation to any other party. |
| 5.15 | Exercise of rights |
| (a) | Unless expressly required by the terms of this deed, a party is not required to act reasonably in giving or withholding any consent or approval or exercising any other right, power, authority, discretion or remedy, under or in connection with this deed. |
| (b) | A party may (without any requirement to act reasonably) impose conditions on the grant by it of any consent or approval, or any waiver of any right, power, authority, discretion or remedy, under or in connection with this deed. Any conditions must be complied with by the party relying on the consent, approval or waiver. |
[Director’s deed/deed of indemnity, insurance and access]
page 11
Signing page
| Executed as a deed | ||
|
Signed sealed and delivered by
Mobilicom Limited by | ||
| sign here ► | ||
| Company Secretary/Director | ||
| print name | ||
| sign here ► | ||
| Director | ||
| print name | ||
| Signed sealed and delivered by | ||
| sign here ► | ||
| print name | Yossi Segal | |
| in the presence of | ||
| sign here ► | ||
| Witness | ||
| print name | ||
[Director’s deed/deed of indemnity, insurance and access]
page 12
Exhibit 11.1
Mobilicom Limited.
Insider Trading Policy
| I. | Introduction |
This policy determines acceptable transactions in the securities of Mobilicom Limited (the “Company”) by our employees, officers, directors and certain consultants. During the course of your employment, directorship or consultancy with the Company, you may receive important information that is not yet publicly available (“inside information”), about the Company or about other publicly-traded companies with which the Company has business dealings. Because of your access to this inside information, you may be in a position to profit financially by buying or selling, or in some other way dealing, in the Company’s stock, or stock of another publicly-traded company, or to disclose such information to a third party who does so profit from the inside information you provided (a “tippee”).
| II. | Insider Trading Policy |
| A. | Securities Transactions |
Use of inside information by someone for personal gain, or to pass on, or “tip,” the inside information to someone who uses it for personal gain, is illegal, regardless of the quantity of shares, and is therefore prohibited. You can be held liable both for your own transactions and for transactions effected by a tippee, or even a tippee of a tippee. Furthermore, it is important that the appearance of insider trading in securities be avoided. The only exception is that transactions directly with the Company, e.g., option exercises for cash or purchases under an employee stock purchase plan, are permitted. However, the subsequent sale (including the sale of shares in a cashless exercise program) or other disposition of such stock is fully subject to these restrictions.
| B. | Inside Information |
As a practical matter, it is sometimes difficult to determine whether you possess inside information. The key to determining whether nonpublic information you possess about a public company is inside information is whether dissemination of the information would likely affect the market price of the company’s stock or would likely be considered important, or “material,” by investors who are considering trading in that company’s stock. Certainly, if the information makes you want to trade, it would probably have the same effect on others. Remember, both positive and negative information can be material. If you possess inside information, you may not trade in a company’s stock, advise anyone else to do so or communicate the information to anyone else until you know that the information has been publicly disseminated. This means that in some circumstances, you may have to forego a proposed transaction in a company’s securities even if you planned to execute the transaction prior to learning of the inside information and even though you believe you may suffer an economic loss or sacrifice an anticipated profit by waiting. “Trading” includes acquiring and/or disposing or securities, engaging in short sales, transactions in put or call options, hedging transactions and other inherently speculative transactions, and includes entering into an agreement to do so and/or procuring another person to do so.
Inside information can be either positive or negative information
Although by no means an all-inclusive list, information about the following items may be considered to be inside information until it is publicly disseminated:
| ● | financial results or forecasts (including a material change in anticipated earnings); |
| ● | confirming or updating previous disclosures or analysts’ reports; |
| ● | major product or technological developments; |
| ● | major contract awards or cancellations; |
| ● | M&A activity, including acquisitions or dispositions of assets or divisions; |
| ● | pending public or private sales of debt or equity securities; |
| ● | strategic plans; |
| ● | declaration of stock splits, dividends or changes in dividend policy; |
| ● | top management or control changes; |
| ● | possible tender offers or proxy fights; |
| ● | significant write-offs; |
| ● | significant litigation or settlements; |
| ● | impending bankruptcy; |
| ● | loan defaults; |
| ● | gain or loss of a significant license agreement or other contracts with customers or suppliers; |
| ● | pricing changes or discount policies; |
| ● | the gain or loss of significant customers, suppliers or business partners; |
| ● | corporate partner relationships or joint venture developments; and |
| ● | governmental actions or regulations. |
2
For information to be considered publicly disseminated, it must be widely disclosed through a press release or SEC filing, and a sufficient amount of time must have passed to allow the information to be fully disclosed.
Generally speaking, information will be considered publicly disseminated after a reasonable period has elapsed. Indicatively, the Company considers that allowing one full trading day to elapse since the date of public disclosure of the information satisfies this requirement. For example, if an announcement of inside information of which you were aware was made prior to trading on Wednesday, then you may execute a transaction in the Company’s securities on Thursday and if an announcement was made after close of trading on Wednesday, you could execute the transaction on Friday.
| III. | Stock Trading by Directors, Officers and Other Employees |
We require Insiders (as defined below) to do more than refrain from insider trading. We require that they limit their transactions in the Company’s stock to defined time periods following public dissemination of quarterly, interim and annual financial results and notify, and in some instances receive approval from, the Compliance Officer prior to engaging in transactions in the Company’s stock and observe other restrictions designed to minimize the risk of apparent or actual insider trading.
All Insiders (as defined below) are responsible for ensuring they are fully aware of, and comply with, all legal requirements in respect of securities trading, including under applicable legislation. The provisions in this Trading Policy are in addition to all applicable legislative requirements regarding insider trading and the rules of any stock exchange on which the Company’s securities are listed, which apply to a broader category of persons than, but including, Insiders.
The Company has appointed its Director of Finance as the Company’s Insider Trading Compliance Officer (the “Compliance Officer”).
3
| A. | Covered Insiders |
The provisions outlined in this Insider Trading policy apply to all employees, directors, and officers of the Company, and any consultant of the Company that is specifically designated by the Compliance Officer (collectively, “Insiders”). Generally, any entities or family members of those individuals whose trading activities are controlled or influenced by any of such persons should be considered to be subject to the same restrictions.
| B. | Window Period |
Generally, except as set forth in this paragraph B and in paragraphs C, D and G of this policy, Insiders may buy or sell securities of the Company only during a “window period” that opens after one full trading day has elapsed after the public dissemination of the Company’s annual, interim or quarterly financial results and closes on the last trading day two weeks before the end of any fiscal quarter for which the Company prepares financial statements. This window period may be closed early or may not open if, in the judgment of the Company’s Compliance Officer, there exists undisclosed information that would make trades by members of the Company’s directors, officers or employees inappropriate. It is important to note that the fact that the window period has closed early or has not opened should be considered inside information. An Insider who believes that special circumstances require him or her to trade outside the window period should consult with the Company’s Compliance Officer. Permission to trade outside the window period will be granted only where the circumstances are extenuating and there appears to be no significant risk that the trade may subsequently be questioned. Each Insider is responsible for ensuring they comply with this policy where they seek to trade during a window period.
| C. | Exceptions to Window Period |
1. Option/Warrant Exercises. Insiders may exercise options/warrants for cash granted under the Company’s equity incentive plans without restriction to any particular period in light of information then available to the public. However, the subsequent sale of the stock (including sales of stock in a cashless exercise) acquired upon the exercise of options/warrants is subject to all provisions of this policy.
2. 10b5-1 Automatic Trading Programs. In addition, purchases or sales of the Company’s securities made pursuant to, and in compliance with, a written plan established by a director, officer or other employee that meets the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (a “Trading Plan”) may be made without restriction to any particular period provided that (i) the Trading Plan was established in good faith, in compliance with the requirements of Rule 10b5-1, at the time when such individual was not in possession of material nonpublic information about the Company and the Company had not imposed any trading blackout period, (ii) the Trading Plan was reviewed by the Company prior to establishment, solely to confirm compliance with this policy and the securities laws, and (iii) the Trading Plan allows for the cancellation of a transaction and/or suspension of such Trading Plan upon notice and request by the Company to the individual if any proposed trade (a) fails to comply with applicable laws (e.g., exceeding the number of shares that may be sold under Rule 144) or (b) would create material adverse consequences for the Company. The Company must be notified of the establishment of any such Trading Plan, any amendments to such Trading Plan and the termination of such Trading Plan.
4
| D. | Pre-Clearance and Advance Notice of Transactions |
In addition to the requirements of paragraph B above, Insiders that the Compliance Officer deems to have routine access to material non-public information (“Access Insiders”) may not engage in any transaction in the Company’s securities, including any purchase or sale in the open market, loan or other transfer of beneficial ownership without first obtaining pre-clearance of the transaction from the Company’s Compliance Officer, at least two business days in advance of the proposed transaction. The Compliance Officer will then determine whether the transaction may proceed. Pre-cleared transactions not completed within five business days shall require new pre-clearance under the provisions of this paragraph. The Company may, at its discretion, shorten such period of time.
Pre-clearance by the Compliance Officer is subject to and conditional upon the relevant Access Insider(s) compliance with this policy, including but not limited to ensuring they are not in possession of material nonpublic information at the time of the trade, which remains the sole responsibility of such Access Insider(s).
Advance notice of gifts or an intent to exercise an outstanding stock option shall be given to the Compliance Officer. To the extent possible, advance notice of upcoming transactions to be effected pursuant to an established Trading Plan under Section III.C.2 above shall also be given to the Compliance Officer.
The following shall be considered Access Insiders, unless otherwise determined by the Compliance Officer from time to time: the Company’s Chief Executive Officer, the Company’s Principal Financial Officer (currently, the Director of Finance) and all the members of the Company’s Board of Directors. The Compliance Officer may further designate any other insider as an Access Insider from time to time.
| E. | Prohibition of Speculative or Short-term Trading |
No Insider may engage in short sales, transactions in put or call options, hedging transactions, margin accounts or other inherently speculative transactions with respect to the Company’s stock at any time.
| F. | Control Stock |
Directors and officers should take care not to violate the restrictions on sales by control persons (Rule 144 under the U.S. Securities Act of 1933, as amended), and should file any notices of sale required by Rule 144.
| IV. | Duration of Policy’s Applicability |
This policy applies to employees, officers, directors, and certain consultants during their engagement with the Company. However, insider trading laws continue to apply even after your relationship with the Company ends. If you possess inside information at the time your employment, directorship, or consultancy terminates, such laws would likely prohibit you from trading in the Company’s securities or those of other companies with which the Company does business, until the information has been publicly disclosed or is no longer material. We recommend that you consult with your own legal counsel to ensure compliance with applicable laws and to avoid engaging in any illegal activity.
| V. | Penalties |
Anyone who effects transactions in the Company’s stock or the stock of other public companies engaged in business transactions with the Company (or provides information to enable others to do so) on the basis of inside information is subject to both civil liability and criminal penalties, as well as disciplinary action by the Company. An Insider who has questions about this policy should contact his or her own attorney or our Compliance Officer, Liad Gelfer at <Liad.Gelfer@mobilicom.com>.
* * *
5
Exhibit 12.1
CERTIFICATION PURSUANT TO EXCHANGE ACT RULE 13a-14(a) or 15d-14(a)
I, Oren Elkayam, certify that:
| 1. | I have reviewed this annual report on Form 20-F of Mobilicom Limited; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
| 4. | The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
| ○ | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| ○ | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| ○ | Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| ○ | Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
| 5. | The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
| ○ | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
| ○ | Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
Date: March 23, 2026
| /s/ Oren Elkayam | |
| Oren Elkayam | |
| Chief Executive Officer |
Exhibit 12.2
CERTIFICATION PURSUANT TO EXCHANGE ACT RULE 13a-14(a) or 15d-14(a)
I, Liad Gelfer, certify that:
| 1. | I have reviewed this annual report on Form 20-F of Mobilicom Limited; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
| 4. | The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
| ○ | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| ○ | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| ○ | Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| ○ | Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
| 5. | The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
| ○ | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
| ○ | Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
Date: March 23, 2026
| /s/ Liad Gelfer | |
| Liad Gelfer | |
| Director of Finance |
Exhibit 13.1
CERTIFICATION PURSUANT TO
18 U.S.C. Section 1350
Pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Mobilicom Limited (the “Company”) hereby certifies to such officer’s knowledge that:
| (i) | the accompanying Annual Report on Form 20-F of the Company for the year ended December 31, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and |
| (ii) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: March 23, 2026
| /s/ Oren Elkayam | |
| Oren Elkayam | |
| Chief Executive Officer |
The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. Section 1350, and is not being filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference to any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Exhibit 13.2
CERTIFICATION PURSUANT TO
18 U.S.C. Section 1350
Pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Mobilicom Limited (the “Company”) hereby certifies to such officer’s knowledge that:
| (i) | the accompanying Annual Report on Form 20-F of the Company for the year ended December 31, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and |
| (ii) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: March 23, 2026
| /s/ Liad Gelfer | |
| Liad Gelfer | |
| Director of Finance |
The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. Section 1350, and is not being filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference to any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
Exhibit 15.1
Consent of Independent Registered Public Accounting Firm
Mobilicom Limited
Level 7, 90 Collins Street
Melbourne, Victoria, 3000
Australia
We hereby consent to the incorporation by reference in the Registration Statements on Form F-3 (File No. 333-274929) and Form S-8 (Files No. 333-284265 and 333-289762) of our report dated March 23, 2026, relating to the consolidated financial statements of Mobilicom Limited (the “Company”), appearing in the Company’s Annual Report on Form 20-F for the year ended December 31, 2025.
| Tel-Aviv, Israel | /s/ Ziv haft |
| March 23, 2026 | Certified Public Accountants (Isr.) |
| BDO Member Firm |
| Tel Aviv 03-6386868 |
Jerusalem 02-6546200 |
Haifa 04-8680600 |
Beer Sheva 077-7784100 |
Bnei Brak 073-7145300 |
Kiryat Shmona 077-5054906 |
Petah Tikva 077-7784180 |
Modiin Ilit 08-9744111 |
Nazrat Ilit 04-6555888 |
Main office: Beit Amot BDO, 48 Menachem Begin Road, Tel Aviv, 6618001 Email: bdo@bdo,co.il Website: www.bdo.co.il
BDO Israel, an Israeli partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firm