10-K: American Rebel Holdings Reports $11.4 Million Revenue for 2024 Amidst Strategic Shifts and Financial Maneuvering

American Rebel Holdings, Inc. reports $11.4 million in revenue for 2024 while navigating strategic shifts, debt financing, and compliance with Nasdaq listing requirements.

Summary

• American Rebel Holdings, Inc. reported $11.4 million in revenue for the fiscal year ended December 31, 2024, a decrease from $16.0 million in the previous year.
• The company experienced a net loss of $17.6 million, compared to a net loss of $9.7 million in 2023.
• The company has been actively involved in debt and equity financing activities, including multiple promissory notes, revenue interest purchase agreements, and a private placement.
• American Rebel is working to maintain compliance with Nasdaq listing requirements, having addressed previous deficiencies related to the annual meeting and bid price, but facing new challenges regarding stockholders' equity.
• The company is expanding its presence in the beverage industry with American Rebel Light Beer, while continuing to market its branded safes and personal security products.
• Legal proceedings are ongoing, including a complaint filed by Bank of America and a trademark infringement claim by Liberty Safe.
• The company has identified material weaknesses in its internal control over financial reporting, leading to a conclusion that its disclosure controls and procedures were not effective as of December 31, 2024.

Sentiment

Score: 3

Explanation: The document presents a mixed picture, with positive developments in brand expansion offset by significant financial losses, ongoing legal challenges, and concerns about internal controls and Nasdaq compliance. The overall sentiment is cautiously negative.

Positives

• The company is expanding its presence in the beverage industry with American Rebel Light Beer.
• The company is actively working to address and remediate material weaknesses in internal controls.
• American Rebel has secured key distribution agreements for its beer product in multiple states.
• The company is leveraging its CEO's media presence and brand recognition to promote its products.

Negatives

• The company experienced a net loss of $17.6 million in 2024.
• Revenue decreased from $16.0 million in 2023 to $11.4 million in 2024.
• The company has a working capital deficit of $8.9 million as of December 31, 2024.
• The company has identified material weaknesses in its internal control over financial reporting.
• The company is facing legal challenges, including a complaint filed by Bank of America and a trademark infringement claim by Liberty Safe.

Risks

• The company's ability to continue as a going concern is dependent on securing additional funding and achieving profitability.
• The company is subject to intense competition in the safe and personal security industry.
• The company's financial results may be affected by tariffs or border adjustment taxes.
• The company's success depends on its ability to introduce new products that track customer preferences.
• The company is highly dependent on its Chief Executive Officer, Charles A. Ross, Jr.

Future Outlook

The company plans to grow its business through organic expansion, strategic acquisitions, and brand licensing, while also addressing its working capital needs and Nasdaq compliance.

Management Comments

• American Rebel is boldly positioning itself as Americas Patriotic Brand.
• Theres a growing need to know how to protect yourself, your family, your neighbors or even a room full of total strangers, says American Rebels Chief Executive Officer Andy Ross.
• Its not hardware; it is a lifestyle, an emotional attachment.
• American Rebel Chief Executive Officer Andy Ross and the rest of the American Rebel team are committed to fulfilling the opportunity in the gun safe market and filling the identified void with American Rebel Gun Safes.

Industry Context

The North American safe industry is dominated by a small number of companies, and American Rebel competes primarily on quality, safety, reliability, features, performance, brand awareness, and price.

Comparison to Industry Standards

• The North American safe industry is dominated by a small number of companies, including Liberty Safe, Fort Knox Security Products, American Security, Sturdy Safe Company, Homeland Security Safes, SentrySafe and as well as certain other domestic manufacturers, as well as certain China-based manufactured safes.
• American Rebel's brand strategy is similar to the successful Harley-Davidson Motorcycle philosophy, referenced in this quote from Richard F. Teerlink, Harleys chairman and former chief executive, Its not hardware; it is a lifestyle, an emotional attachment.

Legal Proceedings

• The Company received notice of a complaint filed in the U.S. District Court for the District of Utah by Liberty Safe and Security Products, Inc. alleging trademark infringement.
• Bank of America filed a complaint in the Fourth Judicial District Court in and for Utah County, State of Utah against the Company and its subsidiaries alleging four causes of action related to the credit facility.

Related Party Transactions

• The Company leases multiple facilities from UtahTennessee Holding Company, LLC and Champion Holdings, LLC, two companies owned by former Champion Entities founder and Chief Executive Officer Mr. Crosby.
• The Company issued 124,812 shares of Series A Preferred Stock to three members of its executive management team, Messrs. Charles A. Ross, Jr., Corey Lambrecht and Doug E. Grau, which have superior voting rights of 1,000 to 1 over shares of our common stock, resulting in over 98% of the current available stockholder votes.

Stakeholder Impact

• Shareholders face potential dilution from future equity offerings and the exercise of outstanding warrants.
• Employees may be affected by cost-cutting measures and potential changes in business operations.
• Customers may experience changes in product availability and pricing due to supply chain disruptions and financial constraints.
• Creditors face increased risk due to the company's high debt levels and potential default on loan agreements.

Next Steps

• The company plans to defend the complaint filed by Bank of America, while continuing to work on a settlement.
• The company intends to submit a compliance plan to Nasdaq to address the stockholders' equity deficiency.
• The company expects to continue to implement its remediation plans throughout the fiscal year ending December 31, 2025, to address material weaknesses in internal control over financial reporting.

Key Dates

Keywords

American Rebel, financial results, revenue, net loss, going concern, internal control, Nasdaq, warrants, preferred stock, debt, beer, safes