Company: VEEAW
Filing Date: 2025-01-10
Form Type: S-1/A
Source: 0001213900-25-002701
Chunk: 105

Company: VEEA INC.
Filing Date: 2025-01-10
Form: S-1/A
Chunk 105
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,211, or 54%, in the nine months ended September 30, 2024 compared to the nine months ended September
30, 2023. In the third quarter, management had reduced efforts in marketing as the focus was on the Business Combination completion. The
year-to-date increase was due primarily to an increase in customer evaluations and fees paid to third-party marketing firm during the
period.

General and Administrative Expense

General and administrative
expense decreased by $3.2 million, or 62%, in the three months ended September 30, 2024 compared to the three months ended September 30,
2023. General and administrative expense increased by $0.6 million, or 5%, in the nine months ended September 30, 2024 compared to the
nine months ended September 30, 2023. The decrease for the quarter is primarily related to the foreign exchange gain of $1.8 million for
the three months ended, as well as a reclassification of $1.4 million of transaction related expenses out of G&A in the period the
Business Combination occurred. The year-to-date overall increase was primarily due to an increase in net foreign exchange losses, as well
as an increase in professional and consulting fees relating to the Business Combination.

Transaction costs including those incurred with contingent earn-out liability

Following the closing of the
Business Combination, holders of certain capital stock of Private Veea immediately prior to the closing will have the contingent right
to receive up to 4.5 million additional shares of the Company’s common stock if certain trading-price based milestones of the Company’s
common stock are achieved or a change of control transaction occurs during the ten-year period following the Closing. The initial value
of the contingent earn-out share liability of $53.6 million for the three and nine months ended September 30, 2024 is recorded as a transaction
cost within operating expenses. The fair value of the earn-out liabilities was estimated using Monte Carlo simulation utilizing assumptions
related to the contractual term of the instruments, estimated volatility, the price of the Common Stock and current interest rates. A
significant driver of the value of the earn-out at the close of the Business Combination was our closing stock price on September 13,
2024 which was $12.00. Additionally, the Company incurred approximately $1.4 million of professional fees relating to the Business Combination.

Depreciation and Amortization

Depreciation and amortization
decreased by $7,588