Company: VEEAW
Filing Date: 2025-05-21
Form Type: 10-Q
Source: 0001213900-25-046124
Chunk: 50

Company: VEEA INC.
Filing Date: 2025-05-21
Form: 10-Q
Item: Part I, Item 1
Chunk 50
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 of $420,497 for the
three months ended March 31, 2025, was determined based on the trading value of the public warrants. The gain on the change in fair value
of the Earn-Out Share Liability of $10,530,000 for the three months ended March 31, 2025, was determined using a Monte Carlo simulation.
A significant driver of the changes in fair value was due to the decline in the Company’s stock price.

Other expense

Other expenses relate to
immaterial non-operating expenses incurred during the period. These amounts were immaterial for the three months ended March 31, 2025
and 2024.

Interest expense

Interest expense increased
by $489,716, or 107%, in the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was due
to additional draws on our revolving line of credit.

29

Liquidity and Capital Resources

During the three months
ended March 31, 2025 and 2024, the Company incurred operating losses of $5.7 million and $6.1 million, respectively, and had an accumulated
deficit of $213.5 million as of March 31, 2025. Since its inception, the Company has incurred significant operating losses and negative
cash flows. The Company expects to continue to incur net losses as it continues to grow and scale its business. As of March 31, 2025,
the Company had cash of $247,341 and outstanding debt of $15.2 million, of which $750,000 was outstanding under the September 2024 Notes,
$14.0 million was outstanding under the working capital facility, and $485,000 was related party debt outstanding under the NLabs 2025
Notes.

Although we have incurred
recurring losses each year since our inception, we plan to fund our operations and capital funding needs through a combination of private
and public equity and debt offerings, or a combination thereof, including (1) expected cash proceeds from the ELOC Program, (2) the expected
cash tax refund of up to $2.0 million in respect of the Company’s UK subsidiary’s 2023 and 2024 research and development
activities (3) the anticipated refund by June 30, 2025 of up to $5.0 million of the Company’s prepayment for purchased inventory
and (4) potential additional investments in