Company: AGSS
Filing Date: 2025-11-17
Form Type: 10-Q
Source: 0001213900-25-111597
Chunk: 59

Company: AMERIGUARD SECURITY SERVICES, INC.
Filing Date: 2025-11-17
Form: 10-Q
Item: Item 8
Chunk 59
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, allowing for the completion
of the testimony brought by the counsel of Mr. Anderson’ and Mr. Honore’. Following the conclusion of the testimony, Mr. Garcia’s
counsel petitioned the judge that there was no evidence provided that countered the position that Mr. Garcia was in fact an 80% shareholder
and that the court should rule in his favor. The judge agreed.

16

The results of the actions taken by Mr. Anderson
and Mr. Honore’ have impacted the Company negatively in two ways. First, On July 1, 2025, the Company received notice that our Government
Purchase Order/Receivables Financing Agreement (the “Financing Agreement”), dated as of February 5, 2025, between the Company
and List Government Receivables Fund, LLC (the “Lender”), was in default and that no further funding would be available. A
Form 8-K was filed July 10, 2025, detailing the event. The second event was that this action taken by the Lender caused the Company to
forfeit the three Social Security Administration contracts listed in Note 13 above effective June 30, 2025. The impact of the forfeiture
was immediate, reducing monthly revenues by $1.2 million. This situation has put the operations of the Company in jeopardy.

Management has since begun a complete reorganization
of operations which is ongoing. We have taken steps necessary to keep our Transportation company operating and have begun eliminating
all non-vital expenses in all categories and companies. Although we are optimistic that we will be able to continue, the future is not
certain. We can operate profitably moving forward resulting in some free cash flow. Month to month expenses will be met. However, the
amount of debt held by the Company and the amounts due to vendors is significant and may be more than the future operations can manage.
The Company’s continued operations greatly depend upon the arrangements that can be made with the Lender and the patience of our
vendors. 

As the reorganization efforts continue. Management
has managed to reduce operational expenses and direct expenses, while at the same time increased non-government contracting revenue relating
to guard services. As a result, future months will be operating profitably providing some free cash flow. Management has also been working
closely with our operational lender, Legalist, and is optimistic that terms will be met allowing for a new agreement by the end of November
2025. The parameters of the