10-K: Urgent.ly Faces Delisting, Merger Amidst Continued Losses

Urgent.ly Inc. reports a significant net loss for 2025, delisting from Nasdaq, and a proposed cash tender offer and merger with Agero, Inc. at $5.50 per share.

Summary

• Urgent.ly Inc. entered into a Merger Agreement on March 13, 2026, with Agero, Inc. and Medford Hawk, Inc., for a cash tender offer of $5.50 per share, with the merger expected to close in the first half of 2026.
• The company was delisted from the Nasdaq Stock Market LLC on March 18, 2026, and its Common Stock is now traded on the OTCQB Venture Market under the symbol ULYX.
• Revenue decreased by 10% to $129.2 million in 2025 from $142.9 million in 2024, primarily due to contract wind-downs and non-renewals from key Customer Partners.
• Operating loss significantly improved to $(8.9) million in 2025 from $(27.2) million in 2024, and net loss improved to $(20.4) million in 2025 from $(44.0) million in 2024.
• Gross profit increased to $32.8 million in 2025 (25% margin) from $31.6 million in 2024 (22% margin), driven by increased revenue per dispatch and reduced service provider costs.
• The number of completed dispatches decreased to 0.8 million in 2025 from 0.9 million in 2024.
• The independent registered public accounting firm included an explanatory paragraph in its report, raising substantial doubt about the company's ability to continue as a going concern.
• Material weaknesses in internal controls over financial reporting were identified, related to IT general controls and segregation of duties, with remediation plans underway.
• As of December 31, 2025, the company had $5.3 million in cash, cash equivalents, and restricted cash, with a total principal debt balance of $64.4 million maturing in 2026.
• The company divested its wholly-owned subsidiary, The Floow Limited, in September 2024, retaining a 49% equity ownership.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a distressed situation given the Nasdaq delisting, the going concern warning from auditors, and the declining revenue and dispatch volumes. While the proposed merger offers a cash exit for shareholders at a premium to the recent OTCQB price, it signifies the company's inability to continue as an independent public entity under current conditions.

Positives

• Operating loss significantly improved from $(27.2) million in 2024 to $(8.9) million in 2025.
• Net loss improved from $(44.0) million in 2024 to $(20.4) million in 2025.
• Gross profit increased to $32.8 million in 2025 from $31.6 million in 2024, with gross margin improving from 22% to 25%.
• Customer satisfaction score (CSAT) improved to 4.6 out of 5 stars in 2025 from 4.5 in 2024.
• Successfully renewed four existing Customer Partners and launched four new ones in 2025.
• Significant reductions in operating expenses across Research and Development (48% decrease), Sales and Marketing (50% decrease), Operations and Support (27% decrease), and General and Administrative (19% decrease).
• Divestiture of non-core asset (The Floow Limited) to focus resources on the core business.
• The Board of Directors approved the proposed merger and recommends stockholders tender their shares, offering a potential cash exit for shareholders.

Negatives

• Revenue decreased by 10% to $129.2 million in 2025 from $142.9 million in 2024.
• Dispatch volumes declined from 0.9 million in 2024 to 0.8 million in 2025.
• The company was delisted from Nasdaq on March 18, 2026, and now trades on the less liquid OTCQB Venture Market.
• The independent auditor issued a going concern warning due to recurring losses and dependence on financing.
• The company has a history of recurring operating losses and an accumulated deficit of $219.2 million as of December 31, 2025.
• Substantial dependence on a limited number of Customer Partners, with the top three representing 58% of 2025 revenue.
• Loss of a top five global OEM Customer Partner in December 2024, resulting in a $6.4 million reduction in revenue.
• Non-renewal of another auto manufacturer Customer Partner in January 2024, resulting in a $4.5 million reduction in revenue.
• Identified material weaknesses in internal controls over financial reporting.
• Current cash, cash equivalents, and restricted cash of $5.3 million as of December 31, 2025, may not be sufficient to fund operations beyond twelve months.
• Total principal debt of $64.4 million as of December 31, 2025, with maturity dates in 2026.
• The company has defaulted on certain financial, reporting, and other covenants under its outstanding loan agreements in the past.

Risks

• Failure to complete the Offer and the Merger within the expected time frame, or at all, could have a material adverse effect on business, operating results, financial condition, and share price.
• The Merger Agreement contains provisions that could discourage a potential competing acquirer, including a $3.0 million termination fee.
• Stockholder litigation could prevent or delay the consummation of the Offer and the Merger or otherwise negatively impact business.
• Potential securities class action litigation could divert management's attention and harm the business.
• Executive officers and directors may have interests in the Offer and the Merger that are different from, or in addition to, those of stockholders generally.
• Business uncertainties and contractual restrictions during the pendency of the Offer and Merger could disrupt business and impair ability to attract/retain employees or maintain relationships with Service Providers and Customer Partners.
• Significant direct and indirect costs incurred due to the Offer and Merger, payable even if not completed.
• If the Offer and Merger are not completed, the company will likely pursue other strategic alternatives, which may not be successful or favorable, potentially leading to restructurings or dissolution.
• Ability to consummate the Offer and Merger or other strategic transactions depends on retaining employees and engaging advisors.
• Failure to retain existing Customer Partners and acquire new ones cost-effectively may prevent profitability.
• Significant competition in the roadside and mobility assistance industries could adversely affect market position.
• History of losses and expectation of continued operating losses for the foreseeable future.
• Need for additional capital, which may not be available on acceptable terms or at all, leading to dilution or restrictive debt terms.
• Substantial dependence on a limited number of Customer Partners (top three represent 58% of 2025 revenue).
• Customer Partners terminating or not renewing contracts, or reducing platform use, would cause revenue decline.
• Failure to protect website, networks, and systems against cybersecurity incidents, or to protect confidential information, could damage reputation and business.
• Inability to successfully implement AI on the platform could adversely affect business.
• If Customer Partners do not expand platform use beyond current roadside solutions, growth could be adversely affected.
• Risks related to optimizing and operating the network of Service Providers and call center operations (e.g., forecasting demand, timely payments, digital dispatch vendor reliance, staffing).
• Independent registered public accounting firm included an explanatory paragraph relating to the ability to continue as a going concern.
• Material weaknesses in internal controls over financial reporting could lead to inaccurate financial reporting.
• Historical growth rates may not be sustainable or indicative of future growth, and challenges to future growth may not be managed successfully.
• Inability to address service requirements of Electric Vehicles (EVs) could adversely affect business.
• Failure to offer high-quality Consumer support may harm relationships and reputation.
• Expansion into new solutions, Customer Partners, Service Providers, technologies, and geographic regions subjects the company to additional risks.
• Ability to provide connected vehicle services depends on accessing data from external providers at reasonable terms and prices; data providers might restrict use or refuse licenses.
• Limited operating history and evolving business model make future prospects and risks difficult to evaluate.
• Rapidly evolving business model in a rapidly evolving industry subjects the company to increased risks.
• Lengthy and variable sales cycle with Customer Partners makes revenue forecasting difficult.
• Need to change pricing model for platform offerings could adversely affect business.
• Difficulties in meeting labor needs for the company and Service Providers could impact business.
• Adverse economic conditions or reduced automotive usage may adversely affect business.
• Inability to accurately forecast demand for mobility assistance services and plan expenses.
• Terms of existing Loan Agreements require meeting covenants and place restrictions on operating/financial flexibility; new debt could further restrict.
• Past defaults on loan covenants and potential inability to obtain future waivers.
• Service Providers not complying with insurance, licensure, and other requirements may subject the company to risks (e.g., liability from accidents, misconduct).
• Reliance on unpatented proprietary technology, trade secrets, processes, and know-how, which may be difficult to protect.
• Inability or failure to protect intellectual property rights, or claims of infringement, could negatively impact operating results.
• Use of open source software may lead to litigation, negatively affect sales, compromise proprietary rights, and create liability.
• Involvement in claims, lawsuits, government investigations, and other proceedings could adversely affect business.
• Unanticipated changes in tax laws may affect future financial results.
• Corporate structure and intercompany arrangements subject to tax laws of various jurisdictions, potentially leading to additional taxes.
• Failure to comply with laws and regulations relating to privacy, data protection, cybersecurity, advertising, and consumer protection.
• Subject to governmental export and import control laws and regulations.
• Requirements of being a public company strain resources, divert management attention, and affect ability to attract/retain qualified board members.
• Increased costs and obligations as a public company.
• Changes in laws, regulations, or rules, or failure to comply, may adversely affect business.
• Delisting from Nasdaq limits investor ability to transact in securities.
• Lack of an active trading market for securities may develop, further affecting liquidity and price.
• Stock price may be volatile and decline regardless of operating performance.
• Qualifying as an emerging growth company with reduced disclosure requirements may make common stock less attractive to investors.
• Future sales of shares by existing stockholders could cause stock price to decline.
• If securities or industry analysts do not publish research or publish unfavorable research, stock price/volume could decline.
• Delaware law and provisions in Charter and Bylaws could make a merger, tender offer, or proxy contest difficult.
• Charter provides exclusive forum for disputes, limiting stockholders' ability to choose a favorable judicial forum.
• Ability to timely raise capital in the future may be limited or unavailable on acceptable terms.
• Issuance of additional shares of Common Stock or other equity securities without approval would dilute ownership interests and depress market price.
• No intention to pay dividends for the foreseeable future.

Future Outlook

The company anticipates the cash tender offer and merger with Agero, Inc. will be consummated in the first half of 2026, after which it will become privately held and cease filing periodic reports. It expects to continue investing approximately $5.0 to $6.0 million in capitalized software costs during 2026 to streamline operations and optimize Service Provider supply and pricing. The company plans to explore new revenue-generating use cases, launch a B2C subscription offering, and expand into international markets like Europe and South America, leveraging the transformational opportunities in the evolving mobility assistance sector. Urgent.ly is also dedicated to maintaining a vigilant stance against cyber threats through continued investment in cybersecurity technologies, enhanced staff training, and collaborations with experts.

Management Comments

• We believe that the benefits of increased protection of our potential ability to negotiate with an unfriendly or unsolicited acquirer outweigh the disadvantages of discouraging a proposal to acquire us because negotiation of these proposals could result in an improvement of their terms.
• The board of directors of the Company has approved the Merger and recommends that the Company's stockholders tender their Shares in the Offer.
• We anticipate that the Offer and the Merger contemplated under the Merger Agreement will be consummated in the first half of 2026.
• We believe the comprehensiveness of our asset-light, scalable platform, which we built strategically to both define and expand the mobility assistance ecosystem, will enable us to effectively address the industry's historical challenges, as well as capitalize on future automotive needs that may arise through continued innovation across mobility and technology.
• Our aspirational goal is 100% Consumer satisfaction.
• We are now focused on investing in our proprietary technology, machine learning and data analytics models in order to streamline and digitize the high-touch aspects of our operations.
• Our management believes that these actions will enable us to address this material weakness that was identified and maintain a properly designed and effective system of internal control over financial reporting and provide appropriate segregation of duties.
• At Urgently, we understand the paramount importance of cybersecurity in safeguarding our operational integrity, customer information, and proprietary data.
• Looking ahead Urgently is dedicated to maintaining a vigilant stance against cyber threats. We will continue to invest in cutting-edge cybersecurity technologies, enhance our staff training programs, and foster collaborations with leading cybersecurity experts.

Industry Context

StockSavvy.ai notes that the mobility assistance sector is undergoing a significant transformation driven by technological innovation, electrification (EVs), connectivity, and autonomous vehicles (AVs). The industry is moving away from legacy providers and high-touch call center interactions towards digitized platforms leveraging GPS, mapping, mobile phones, AI, and machine learning for optimized service delivery. The global vehicle roadside assistance market is valued at $25 billion, with the broader mobility economy projected to exceed $100 billion by 2030. Urgent.ly's focus on B2B and B2B2C white-label solutions positions it to capitalize on this shift, particularly with the increasing demand for specialized EV services and proactive assistance for connected vehicles. The proposed merger with Agero, Inc. suggests a consolidation trend in the evolving market, where larger players seek to integrate advanced digital capabilities.

Comparison to Industry Standards

• The filing states that the roadside assistance industry has historically been dominated by legacy providers who have not capitalized on technological advancements, positioning Urgent.ly as an 'early technology innovator' with a 'digitally native software platform' offering an 'innovative alternative.'
• The company notes that there is not a single dominant Service Provider network in North America, and it aims to address this fragmentation through digital coordination and aggregation of independent providers.
• StockSavvy.ai notes that while Urgent.ly highlights its technological differentiation and improved CSAT score of 4.6 out of 5 stars, the filing does not provide specific benchmarks against direct competitors like AAA, Agero (the acquirer), or other emerging digital roadside assistance platforms to assess its performance relative to industry leaders. The market is described as fragmented, implying a lack of clear industry-wide performance standards for direct comparison.

Management Changes

Corporate Governance

Legal Proceedings

• No current actions, claims, suits, or other legal proceedings are expected to have a material adverse effect on the business, financial condition, or results of operations.
• The company expects to continue to receive complaints from Consumers and face actual or threatened legal action related to Service Provider conduct.
• Potential for litigation claims from individual employees of Service Providers as the company expands to new jurisdictions.
• Potential for securities class action litigation following significant business transactions or negative events.
• Stockholder litigation could prevent or delay the consummation of the Offer and Merger.

Related Party Transactions

• A Purchase Agreement dated February 26, 2025, with investors, including entities affiliated with Highbridge, for the issuance of 113,170 shares of common stock (Initial Eighth Amendment Premium Shares) and an additional 112,038 shares (Subsequent Eighth Amendment Premium Shares) on July 1, 2025.
• A Registration Rights Agreement dated February 26, 2025, with investors, including Highbridge affiliates, for the resale of shares and piggyback registration rights.
• An Amended Investors Rights Agreement dated October 18, 2023, with certain holders of capital stock, including BMW iVentures, Iron Gate Urgently, LLC, EHV, Emerald Industrial Innovation Fund L.P., American Tire Distributors Holdings, Inc., Forte Ventures L.P., Forte Urgent.ly LLC, and Porsche Investments Management S.A., providing demand and piggyback registration rights.
• The 2022 Convertible Notes Amendment on March 12, 2026, with 2022 Convertible Noteholders (who are also stockholders), agreeing to pay principal and accrued interest of $6.6 million, plus an $85 thousand amendment fee and a $1 million closing fee, in exchange for waiving certain interest and a premium provision related to a sale of the company.

Stakeholder Impact

• Shareholders will receive $5.50 per share in cash if the merger is completed, providing a definitive exit from a company facing significant financial challenges and delisting. The delisting to OTCQB has already reduced liquidity for current holders.
• Employees may experience business uncertainties and contractual restrictions during the merger pendency, potentially impacting retention and morale. Recent CFO changes highlight ongoing management adjustments.
• Customer Partners and Consumers could face disruptions to current plans and operations due to the merger, potentially affecting relationships and service continuity, despite the company's commitment to 'exceptional assistance experiences.'
• Service Providers' relationships could be adversely affected by business uncertainties, as the company relies on them for service delivery and timely payments.
• Creditors, particularly those holding the MidCap Credit Agreement and Highbridge Term Loan, have agreed to amendments extending maturity dates and modifying liquidity requirements, indicating ongoing negotiations and potential risks related to debt repayment. The 2022 Convertible Noteholders are expected to be paid out as part of the merger conditions.

Next Steps

• Consummation of the cash tender offer and merger with Agero, Inc. in the first half of 2026.
• Nasdaq to file a Form 25 Notification of Delisting with the SEC, making the delisting effective 10 days later.
• Closing of the sale of The Floow Limited shares for $1.7 million in cash, expected in April 2026.
• Remediation of identified material weaknesses in internal controls over financial reporting.
• Continued investment in proprietary technology, machine learning, and data analytics models.
• Exploration of revenue-generating potential in new use cases.
• Launch of a B2C subscription offering.
• Expansion into new international geographies (Europe and South America).
• Capitalization of $5.0 to $6.0 million in software costs during 2026.

Key Dates

Recommendation

The definitive merger agreement at $5.50 per share provides a clear, near-term cash exit for shareholders, which is a positive given the company's delisting, going concern warning, and declining revenue. While the company faces significant operational and financial challenges, the offer price represents a premium over the recent OTCQB trading price. Investors should hold to realize the merger consideration, as the downside risk of the company continuing as a standalone entity with its current issues is mitigated by the acquisition.

Keywords

Mobility assistance, Roadside assistance, Software platform, B2B, B2B2C, Connected vehicles, AI, Machine learning, SEC filing, 10-K, Merger, Delisting, ULYX, Agero, Inc., Financial results, Operating loss, Net loss, Gross margin, Customer satisfaction, Going concern, Internal controls, Debt, Liquidity, Capital raise, Intellectual property, Cybersecurity, Corporate governance