AHRO 10-K & 10-Q changes, risk factors and insider trading

We had net cash used in operating activities of $227,228$126,719 for the year ended Decembre 31, 2023.2024. AtOn December 31, 2023,2024, we had a working capital deficit of $4,998,581.$5,324,665. Any losses in the future could cause the quoted price of our common stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows.

We intend to seek interim short-term financing to continue full legal compliance with its SEC filings, and to bring on the necessary personnel to begin its future development activities. Our working capital needs will be met largely from the sale of debt and public equity securities, including in this offering,securities until such time that funds provided by operations, if ever, are sufficient to fund working capital requirements. The accompanying financial statements do not include any adjustments relating to the recoverability or classification of recorded assets and liabilities that might result should our company be unable to continue as a going concern.

We have established preferred stock, which our Board of Directors can designate and issue without shareholder approval. We havehave, outstanding 600,000685,442 shares of preferred stock, with 400,000 shares as ClassSeries B Convertible Preferred Stock, 100,000 shares as ClassSeries C Preferred Stock andStock, 100,000 shares as ClassSeries D Preferred stock.stock, 80,000 shares of Series E Preferred Stock, and 5,442 shares of Series Z Preferred Stock. We havehave, remainingremaining, 400,000314,558 shares of preferred stock authorized but undesignated. These shares of undesignated preferred stock may be issued by our Board of Directors from time to time, in one or more series, each series of which shall have such voting powers, full or limited, or no voting powers, and such preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof as adopted by our Board of Directors. Our Board of Directors is able to designate the powers and preferences of any such series of preferred stock without shareholder approval.

We have approximately $1,388,536$1,513,737 in currently convertible debt instruments,instruments (including accrued and unpaid interest of $470,632), the existence and/or conversion of which could cause a reduction in the market price for our common stock. AsOn ofDecember the31, date2024, ofAon thisDecember Annual31, Report,2024, we have approximately $1,388,536$1,513,737 in currently convertible debt instruments,instruments (including accrued and unpaid interest of $470,632), the conversion terms of which require share issuances at below-market prices. All such shares constitute an overhang on the market for our common stock and, if and when issued, will be issued without transfer restrictions, pursuant to certain exemptions from registration, and could reduce prevailing market prices for our common stock. Also, in the future, we may also issue securities in connection with our obtaining needed capital or an acquisition transaction. The amountnumber of shares of our common stock issued in connection with any such transaction could constitute a material portion of our then-outstanding shares of common stock.

Our failure to reserve sufficient shares of common stock could be considered an event of default. We have existing convertible promissory notes with a covenant to reserve sufficient shares of common stock with our transfer agent for the potential conversion of these securities. As of the date of this Annual Report, the calculated shares issuable under the assumed conversion of the promissory notes is greater than the amountnumber of shares that we have reserved with respect to such convertible promissory notes. As a result, the holders of such convertible promissory notes could declare an event of default and the principal and accrued interest would become immediately due and payable. Additionally, the holders of such convertible promissory notes have additional remedies, including penalties against our company.

We may seek capital that may result in shareholder dilution or that may have rights senior to those of our common stock. From time to time, we may seek to obtain additional capital, either through equity, equity-linked or debt securities. The decision to obtain additional capital will depend on, among other factors, our business plans, operating performance and the condition of the capital markets. If we raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our common stock, which could negatively affect the market price of our common stock or cause our shareholders to experience dilution.

Operating expenses increased from $415,048$660,910 for the year ended December 31, 2022,2023, to $641,968$997,220 for the year ended December 31, 2023.2024. Overall, this decreaseincrease resultsresulted from aan declineincrease in depreciation and amortization,amortization offsetof byintangible expensesassets in our effortsdue to acquirethe acquisition of Maybacks and the license of Goliath, and, general and administrative expenses, to build out our organization to establish a strong base for current and future growth. The increase in operating expenses was offset by decreases in professional fees and research and development expenses. The detail of expenditures by major category is reflected in the table below.

Operating expenses increased by 59.24%$336,310, inor the50%, amount of $245,862 forduring the year ended December 31, 2023,2024, compared to the year ended in 2022.2023. Listed below are the major changes to operating expenses:

Depreciation and amortization increased by $209,409$224,000, or 75%, for the year ended December 31, 2023,2024, compared to the year ended in 2022,2023, primarily due to the amortization of the customer list related to the Maybacks acquisition and the license agreement executed with Goliath.

Professional and legal fees increaseddecreased by $36,090$40,000, or 30%, for the year ended December 31, 2023,2024, compared to the year ended in 2022,2023, primarily due to $11,648a decrease of $52,000 in other consulting fees.fees which were offset by an increase in audit fees of $24,000.

Research and development increaseddecreased by $8,457,$52,000, or 92%, for the year ended December 31, 2023,2024, compared to the year ended in 2022,2023, primarily due to the development of blockchain built putout and NFT platform service product lines were completed during the first quarter of 2023.

Other expenses were $997,545$594,210 for the year ended December 31, 2023,2024, compared to $742,735$997,545 for the year ended in 2022,2023. During 2024, other expenses resulted primarily asfrom the write-off of advances in the amount of $625,000, interest expense of $294,330 and a resultloss on the settlement of notes in the amount of $170,813. These other expenses were offset in part by a gain in the valuation of derivative liabilities of $495,933. During 2023, other expenses consisted primarily of interest expense of $344,443, the loss on debt conversion of $452,472, derivative expense of $239,028, offset by the a loss in the valuation of derivative liabilities of $24,567 and the gain on the settlement of license agreements of $125,000.

Since our inception, we have financed our operations through private placements and convertible notes. Based upon the current financial condition, we do not have sufficient cash to operate our business at the current level for the next twelve months. We intend to fund operations through increased sales and debt and/or equity financing arrangements, which may be insufficient to fund expenditures or other cash requirements. We plan to seek additional financing in a private equity offering to secure funding for operations. There can be no assurance that we will be successful in raising additional funding. If we are not able to secure additional funding, the implementation of our business plan will be impaired. There can be no assurance that such additional financing will be available to us on acceptable terms or at all.

The financial statements have been prepared assuming we will continue as a going concern. We have incurred losses since inception, resulting in accumulated deficits of $38,038,768$39,358,905 and $36,380,313$38,038,768 at December 31, 20232024 and 2022,2023, respectively, a working capital deficit of $4,998,581$5,324,665 and $4,603,481$4,998,581 as of December 31, 20232024, and 2022,2023, respectively, and future losses are anticipated. We also have debt that is currently in default. These factors, among others, raise substantial doubt about our ability to continue as a going concern.

Advances arewere amounts provided to Inventel Products LLC for the production of vinyl records, that were to be sold through the Company’s joint venture. During 2024, Company management has determined that the advances are uncollectible and has charged other expense in the accompanying statement of operations for the year ended December 31, 2024.

Expenditures for research and development are expensed as incurred. Research and development expenses consistsconsist of expenses paid to outside contractors related to the development of the Company’s NFT platform.

Authentic HoldingsHoldings, Inc. (formerly Global Fiber Technologies, Inc.) was incorporated in Nevada on March 25, 2005. We are a multi-faceted media and merchandising company with operating subsidiaries and license rights,assets, described below.

There are no assurances that we will be able to compete against these larger rivals and gain market share. We have realized revenues starting in the quarter ended JuneSeptember 30, 2024, and continuing through the quarter ended JuneSeptember 30, 2025, and we are hopeful more advertising agreements are signed and more ad pressions are sold to generate future revenue for our company. While these are signs that progress in our company has been made, we are not profitable and still face several challenges, including those presented as ‘Risk Factors” in our Annual Report on Form 10-K filed with the SEC on April 16, 2025.

On April 29, 2025, the Company signed and closed ana new Asset Purchase Agreement (the “Purchase Agreement”) with Goliath Motion Picture Promotions owned by Seller to formally acquire the assets previously licensed. In consideration therefore, the Purchase Agreement providedprovides that the GoliathSeller shall exchange itsthe 100,000 shares of Series D Preferred Stock for 100,000 shares of the Company’sBuyer’s newly established Series F Preferred Stock.

Maybacks has already been utilizing the Assets under the previous license and will continue to utilize the Assets, now acquired, to further its business plan. Maybacks has Vast Tag ad driven “Rev-Share” partnerships with very large groups such as “Whale TV,” which controls through its Operating System over 41 million homes spread across 400 plus Smart TV manufacturers. In addition, Maybacks also has a rev share agreement with LIME X, another content global distribution platform, which has had over 100 million downloads of its streaming app. Maybacks expect to launch its Vast Tag ad programs with both entities in lateearly May 2025.

AHI has patented technology that takes the original event worn apparel from an iconic individual and creates “Fan-wear” collectibles containing fibers from that original. All of the Fan-Wear items have an embedded QR Code that registers the items on our Blockchain for their provenance and immutability. During 2024, we entered into a license agreement with Tommy DeVito, Quarterback with the New York Giants Football Team, and we expect to launch the Authentic Heroes version of “Fan-Wear” at the start ofduring the NFL 2025 season. The company is also in licensing discussions with other athletes to further Authentic Heroes opportunities.

The Authentic Heroes subsidiaryRecordings is also in the business of creating vinyl records for distribution into retail department stores and online sales and has pressed 150,000 vinyl records to date under the heading of “Old is Gold” Christmas. It is also the Company’s intention to expand the Old is Gold division and create a Holiday Season album for 2025 as well as “Theme Based” Vinyl’s, such as for Black History Month, for example, as well as other cultural holidays from our library of over 17,000 Master Recordings.

The AuthenticNFT HeroesMint subsidiary alsoFarm has completed an NFT Platform on the Ethereum Blockchain capable of housing millions of NFTs. The NFT platform has minted 500,000 NFTs as part of free music NFT given away with its “Old is Gold” Christmas album. The NFT Mint Farm plans to start to market music NFTs once management has consulted with its advisors and determines that a regulatory pathway exists for this business line.line which is anticipated in first quarter of 2026

The Company intends to fund operations through increased sales and debt and/or equity financing arrangements, which may be insufficient to fund its expenditures or other cash requirements, until the Company generates positive cash flow from operations. However, the Company’s financial statements show an accumulated deficit of $40,383,043$40,440,662 as of JuneSeptember 30, 2025, with a net working capital deficit of $6,231,539$6,284,026 and limitedvirtually no cash resources. The Company has several promissory notes in default, including convertible notes with face values of $1,542,827,$1,587,148, related party promissory notes with face values of $497,150 and self-liquidating promissory notes of $135,833.$137,083. The Company is negotiating extensions and/or forbearance agreements with certain of these lenders, but no formal agreements have been reached. These factors raise doubts about the Company’s ability to continue as a going concern within the next year.

Results of Operations for the Three and SixNine Months Ended JuneSeptember 30, 2025 and 2024.

We earned revenue of $97,163$98,448 for the three months ended JuneSeptember 30, 2025, as compared with $27,332$97,096 for the three months ended JuneSeptember 30, 2024. We earned revenue of $250,477$348,925 for the sixnine months ended JuneSeptember 30, 2025, as compared with $67,572$164,668 for the sixnine months ended JuneSeptember 30, 2024.

Authentic Heroes, our patented “Fanwear” division, has signed a license with NFL Quarterback Tommy DeVito aka “Tommy Cutlets.” We are in the process of making samples that should be approved in the coming weeks and expect to launchrelease thethis Authenticcommemorative Heroescollectible versionon ofour “Fan-Wear”new atE-Commerce thesite startsubsequent of theto NFL 2025Mini season.Camp. We are also in discussions for licenses with several other Tier 1 athletes, which we anticipate will be signed subsequent to the Tommy DeVito rollout.

The Company has recently signed a “Revenue Sharing Agreement” with LIME X a very large global distributor of content. They will be marketing our iDreamCTV app to their 100,000,000 plus download audience. We expect the launch of this platform in lateMay of 2025.

Operating expenses increaseddecreased from $206,368$222,366 for the three months ended JuneSeptember 30, 2024, to $341,377$173,954 for the three months ended JuneSeptember 30, 2025. Operating expenses increased from $451,726$674.092 for the sixnine months ended JuneSeptember 30, 2024, to $759,061$933,015 for the sixnine months ended JuneSeptember 30, 2025.

Operating expenses increaseddecreased in the amount of $135,009$48,412 for the three months ended JuneSeptember 30, 2025, compared to the three months ended JuneSeptember 30, 2024.

General and administrative expenses increased by $187,297$92,568 for the three months ended JuneSeptember 30, 2025, compared to the three months ended JuneSeptember 30, 2024. The increase resulted primarily from increased royalty of $13,832$3,439 due under the terms of the Maybacks acquisition agreement, increased salary expense of $87,501, and increased sponsorships of $55,000. General and administrative expenses increased by $371,111 for the six months ended June 30, 2025, compared to the six months ended June 30, 2024. The increase resulted primarily from increased royalty of $49,342 due under the terms of the Maybacks acquisition agreement, increased salary expense of $175,002, and increased sponsorships of $55,000. Beginning in October 2024, the Company began accruing a salary expense of $350,000 per annum for the Chris Giordano, the Company President.$10,000.

Depreciation and amortization decreased by $87,926$123,888 for the three months ended JuneSeptember 30, 2025, compared to the three months ended JuneSeptember 30, 2024. Depreciation and amortization decreased by $83,354$207,242 for the sixnine months ended JuneSeptember 30, 2025, compared to the sixnine months ended JuneSeptember 30, 2024. The decrease was primarily due to the Company’s purchase of various full-length motion pictures and serial television shows (the “Assets”) that had been previously licensed from Goliath. The purchased assets are not being depreciated or amortized.

Research and development increased by $19,250 for the three months ended June 30, 2025, compared to the three months ended June 30, 2024. Research and development increased by $20,733 for the sixnine months ended JuneSeptember 30, 2025, compared to the sixnine months ended JuneSeptember 30, 2024. The increase during both periods2024 was primarily due to an increase of $19,100about $19,000 in NTF Platform fees.

OtherNet other income totaled $668,550$49,225 for the three months ended JuneSeptember 30, 2025, compared to net other incomeexpense of $1,110,626$193,048 for the three months ended JuneSeptember 30, 2024. OtherNet expensesother expense totaled $443,464$394,239 for the sixnine months ended JuneSeptember 30, 2025, compared to net other income of $274,712$81,664 for the sixnine months ended JuneSeptember 30, 2024. The increases and decreases in other income and other expenses during both periods in 2025 primarily resulted from the change in the fair value of derivative liabilities.

We recorded a net incomeloss of $389,491$57,629 for the three months ended JuneSeptember 30, 2025, compared to a net incomeloss of $920,090$360,993 for the three months ended JuneSeptember 30, 2024. We recorded a net loss of $1,024,138$1,081,757 for the sixnine months ended JuneSeptember 30, 2025, compared to a net loss of $151,861$512,854 for the sixnine months ended JuneSeptember 30, 2024.

Since our inception, we have financed our operations through private placements, convertible notes, and unsecured debt, and we have recently issued debt in our company secured by all of our assets. Our current liabilities on our Condensed Consolidated Balance Sheets on JuneSeptember 30, 2025, contains certain debt that is in default, including convertible notes with face values of $1,542,827,$1,587,148, related party promissory notes with face values of $497,150 and self-liquidating promissory notes of $135,833.$137,083. On JuneSeptember 30, 2025, we have limited cash, a substantial working capital deficit, our revenues have only commenced in 2024, and future losses are anticipated. Additionally, we expect to experience higher interest payments in the future as a result of our outstanding liabilities. If we are unable to generate sufficient revenues and/or additional financing to service this debt, there is a risk the lenders will call the notes, and we will be unable to repay the loans. If this happens, we could go out of business.

The following is a summary of the cash and cash equivalents as of JuneSeptember 30, 2025 and December 31, 2024.

Below is a summary of the Company’s cash flows for the six months ended JuneSeptember 30, 2025 and 2024.

Net cash providedused by our operating activities was $4,094$10,407 during the sixnine months ended JuneSeptember 30, 2025 and consisted of the net loss of $1,024,138$1,081,757 offset by thetotal non-cash items for the sixnine months ended JuneSeptember 30, 2025, amounting to $412,671, which consisted of $312,682 change in fair value of derivative liabilities,liabilities of 203,384, bad debt expense of $11,480,$8,373, loss on the conversion of convertible debt of $8,221, finance costs associated with the issuance of debt of $5,600,$8,520, the amortization of debt discount of $1,709,$4,709, and amortization of intangible assets of $185,554,$187,685. and, the significantThe change in operating assets and liabilities which impacted our net cash used by our operating activities were decreases in accounts receivable of $95,947,$94,427, increases in inventory of $23,059, increases in accounts payable and accrued expenses of $297,388,$415,285, and increases in accrued interest of $115,251.$172,026.

Net cash used in operating activities was $120,116 during the sixnine months ended JuneSeptember 30, 2024 was $139,049 and consisted of the net loss of $151,861$512,854 and a $439,515$385,011 change in the fair value of derivative liabilities, mainly offset by the amortization of intangible assets of $251,224.$377,089, Netloss on the conversion of convertible debt of $97,125, amortization of debt discount of $39,435 and depreciation of $21,721. The change in operating assets and liabilities which impacted our net cash used inby our operating activities waswere $336,107increases duringin theaccounts sixreceivable monthsof ended$33,527, Juneincreases 30,in 2023accounts payable and consistedaccrued expenses of the$99,593, netand lossincreases in accrued interest of $227,532 offset by the non-cash items for the six months ended June 30, 2023, of $298,477 change in change in fair value of derivative liabilities offset by the gain on derivative liabilities due to conversion of note payable, and a $22,954 decrease in depreciation and amortization expenses.$157,380.

During the sixnine months ended JuneSeptember 30, 2025, the Company paid an advance on the acquisition of a license agreement in the amount of $5,000 and incurred capitalized website costs of $1,400.

The Company did not use any funds for investing activities during the sixnine months ended JuneSeptember 30, 2024.

Net cash provided by or (Used in) financing activities for the sixnine months ended JuneSeptember 30, 2025, and 2024 was $(858)$10,924 and $120,116,$139,174, respectively, and consisting of the following:

We have incurred losses since inception, resulting in accumulated deficits of $40,383,043$40,440,662 and $39,358,905 aton JuneSeptember 30, 2025 and December 31, 2024, respectively,respectively; a working capital deficit of $6,231,539$6,284,026 and $5,324,664 as of JuneSeptember 30, 2025 and December 31, 2024, respectively,respectively; and future losses are anticipated. We also have debt that is currently in default. These factors, among others, raise substantial doubt about our ability to continue as a going concern.

On April 29, 2025, the Company signed and closed ana new Asset Purchase Agreement (the “Purchase Agreement”) with Goliath Motion Picture Promotions owned by Seller to formally acquire the assets previously licensed. In consideration therefore, the Purchase Agreement providedprovides that the GoliathSeller shall exchange itsthe 100,000 shares of Series D Preferred Stock for 100,000 shares of the Company’sBuyer’s newly established Series F Preferred Stock.

The Company’s tax returns are subject to examination by the federal and state tax authorities for the years ended 2017 through 2021. In the unlikely event that an uncertain tax position exists in which the Company could incur income taxes, the Company would evaluate whether there is a probability that the uncertain tax position taken would be sustained upon examination by the taxing authorities. Reserves for uncertain tax positions would be recorded if the Company determined it is probable that a position would not be sustained upon examination or if payment would have to be made to a taxing authority and the amount is reasonably estimated. As of JuneSeptember 30, 2025, the Company does not believe it has any uncertain tax positions that would result in the Company having a liability to the taxing authorities.