Bridger Aerospace Group Holdings Inc.

03/06/2026 | Press release | Distributed by Public on 03/06/2026 15:12

Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion and analysis is intended to help you understand our business, financial condition, results of operations, liquidity and capital resources. The discussion should be read together with the historical audited annual Consolidated Financial Statements as of and for the years ended December 31, 2025 and 2024, and the related notes thereto, that are included elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements based upon our current expectations, estimates and projections that involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements due to, among other considerations, the matters discussed in the sections entitled "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements."
BUSINESS OVERVIEW
Bridger provides aerial wildfire surveillance, relief and suppression, and aerial firefighting services using next-generation technology and environmentally friendly and sustainable firefighting methods primarily throughout the United States, as well as airframe modification and integration solutions for governmental and commercial customers. Our mission is to deploy the most advanced technologies in aviation to protect lives, property, critical infrastructure, and the environment, delivering these capabilities where they are needed most, from wildfire response to defense and beyond. Through innovation and the use of advanced technology and software, focusing on aerial firefighting, disaster response, government applications and public safety, Bridger aims to set the global standard in aviation services.
Our portfolio is organized across three core offerings:
Fire Suppression: Consists of deploying CL-415EAF ("Super Scooper") aircraft to drop large amounts of water as part of the initial and direct attack to slow, contain, and extinguish wildfires.
Aerial Surveillance: Consists of providing aerial surveillance via manned ("Air Attack") aircraft for fire suppression aircraft over an incident and providing tactical coordination with the incident commander.
Maintenance, Repair and Overhaul ("MRO"): Consists of maintenance and repair services for return-to-service upgrades of certain Canadair CL-215 Amphibious ("Spanish Scoopers") aircraft as well as airframe modification and integration solutions for governmental and commercial customers.
We manage our operations as a single segment for purposes of assessing performance, making operating decisions and allocating resources.
We have made and will continue to make significant investments in capital expenditures to build and expand our integrated response solutions. We expect that our existing cash and cash equivalents as well as cash generated from our operations will be sufficient to meet our current working capital and capital expenditure requirements for a period of at least 12 months from the date of this Annual Report on Form 10-K. Refer to the Liquidity and Capital Resourcessection below and "Note 1 - Organization and Basis of Presentation" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details on management's assessment of the Company's ability to continue as a going concern.
The Reverse Recapitalization
On January 24, 2023 (the "Closing Date"), Jack Creek Investment Corp. ("JCIC") completed the reverse recapitalization (the "Closing" and the "Reverse Recapitalization") with the Company's predecessor, Bridger Aerospace Group Holdings, LLC and its subsidiaries (collectively, "Legacy Bridger"). As a result of the Reverse Recapitalization, JCIC and Legacy Bridger each became wholly-owned subsidiaries of a new public company that was renamed Bridger Aerospace Group Holdings, Inc. and JCIC shareholders and Legacy Bridger equity holders converted their equity ownership in JCIC and Legacy Bridger, respectively, into equity ownership in Bridger. Legacy Bridger was determined to be the accounting acquirer as of the Closing Date with respect to the Reverse Recapitalization, which has been accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with GAAP.
KEY FACTORS AFFECTING OUR RESULTS OF OPERATIONS
We are exposed to certain risks inherent to an aerial firefighting business. These risks are further described in the section entitled "Risk Factors" in this Annual Report on Form 10-K.
Seasonality Due to the North American Fire Season
Because wildfires occur at different times in different parts of the country, we operate on a year-round basis. However, historically the majority of wildfires occur in the second and third quarters, so the demand for our services has generally been higher in the second and third quarters of each fiscal year due to the timing and duration of the North American wildfire season with lower demand in the winter months. As a result, seasonality and the varying intensity of the fire season have caused, and may continue to cause, our operating results to fluctuate significantly from quarter to quarter and year to year.
Weather Conditions and Climate Trends
Our business is highly dependent on the needs of government agencies to surveil and suppress fires. As such, our financial condition and results of operations are significantly affected by the weather, as well as environmental and other factors affecting climate change, which impact the number and severity of fires in any given period. The intensity and duration of the North American fire season is affected by multiple factors, some of which, according to a 2023 article by Climate Central, a nonprofit climate science news organization, are weather patterns including warmer springs and longer summers, decreasing relative humidity which lead to drier soils and vegetation and frequency of lightning strikes. Based on the climate change indicators published by the Environmental Protection Agency ("EPA"), these factors have shown year-over-year increases linked to the effects of climate change and the overall trend in increased temperatures. We believe that rising global temperatures have been, and in the future are expected to be, one factor contributing to increasing rates and severity of wildfires. Historically, our revenue has been higher in the summer season of each fiscal year due to weather patterns which are generally correlated to a higher prevalence of wildfires in North America. Larger wildfires and longer seasons are expected to continue as droughts increase in frequency and duration, according to a 2024 article by the EPA.
Per the 2025 National Interagency Coordination Center ("NICC") annual report, the total number of wildfires during 2025 was 78,000, approximately 15.0% above the number wildfires reported in 2024. Additionally, according to data from the NICC, the national wildland fire preparedness level reached Level 4 in 2025 and Level 5 in 2024.
Limited Supply of Specialized Aircraft and Replacement and Maintenance Parts
Our results of operations are dependent on sufficient availability of aircraft, raw materials and supplied components provided by a limited number of suppliers. Our reliance on limited suppliers exposes us to volatility in the prices and availability of these materials which may lead to increased costs and delays in operations.
Economic and Market Factors
Our operations, supply chain, partners and suppliers are subject to various global macroeconomic factors. We expect to continue to remain vulnerable to a number of industry-specific and global macroeconomic factors that may cause our actual results of operations to differ from our historical results of operations or current expectations. The factors and trends that we currently believe are or will be most impactful to our results of operations and financial condition include, but are not limited to, the impact on us of significant operational challenges by third parties on which we rely, inflationary pressures, short-term and long-term weather patterns, potential labor and supply chain shortages affecting us and our partners, volatile fuel prices, aircraft delivery delays and changes in general economic conditions in the markets in which we operate.
Historically, our results of operations have not been materially impacted by other factors. We continue to monitor the potential favorable or unfavorable impacts of these and other factors on our business, operations, financial condition and future results of operations, which are dependent on future developments. Our future results of operations may be subject to volatility and our growth plans may be delayed, particularly in the short term, due to the impact of the above factors and trends. However, we believe that our long-term outlook remains positive due to the increasing demand for our services and our ability to meet those demands consistently, despite adverse market factors. We believe that this expected long-term increase in demand will offset increased costs and that the operational challenges we may experience in the near term can be managed in a manner that will allow us to support increased demand, though we cannot provide any assurances.
On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act ("OBBBA"). Among other things, the OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing, and the business interest expense limitation. In accordance with ASC 740, Accounting for Income Taxes, the impacts of the OBBBA are reflected in the Company's results for the year ended December 31, 2025. However, the changes did not affect the Company's U.S. deferred tax assets or liabilities, as the Company continues to maintain a full valuation allowance against those balances.
KEY COMPONENTS OF OUR RESULTS OF OPERATIONS
Revenues
Our primary source of revenues is from providing services, which are disaggregated into fire suppression, aerial surveillance, MRO and other services. Revenues and growth for our fire suppression and aerial surveillance services are driven by climate trends, specifically the intensity and timing of the North American fire season. MRO includes revenue from return to service and maintenance and repair services performed externally for third parties. Other services primarily consist of extraneous fulfillment of contractual services such as extended availability and mobilizations.
Cost of Revenues
Cost of revenues includes costs incurred directly related to flight operations including expenses associated with operating the aircraft on revenue generating contracts. These include labor, depreciation, fees, travel and fuel. Cost of revenues also includes routine aircraft maintenance expenses and repairs, including maintenance and modification repair work for third-party aircraft, consisting primarily of labor, parts, consumables and travel unique to each airframe.
Selling, General and Administrative Expense
Selling, general and administrative expenses include all costs that are not directly related to satisfaction of customer contracts. Selling, general and administrative expenses include costs for our administrative functions, such as finance, legal, human resources, and IT support, and business development costs that include contract procurement, public relations and business opportunity advancement. These functions include costs for items such as salaries, benefits, stock-based compensation and other personnel-related costs, maintenance and supplies, professional fees for external legal, accounting, and other consulting services, insurance, intangible asset amortization and depreciation expense. Selling, general and administrative expenses also include gains or losses on the disposal of fixed assets.
Interest Expense
Interest expense consists of interest costs related to the prior Gallatin municipal bonds (the "Series 2022 bonds"), that were refinanced during 2025 and the new debt issued in connection with that refinancing, as well as our other various loan agreements. Interest expense also reflects the net effect of the interest rate swap prior to its termination and also includes amortization of debt issuance costs associated with our loan agreements. Refer to "Liquidity and Capital Resources-Indebtedness" included in this Annual Report on Form 10-K for a discussion of our loan commitments.
Other Income
Other income consists of the net impact from the gain recognized on the sale-leaseback transaction related to the hangar and office facilities, as well as the loss on the extinguishment of debt associated with the October debt refinancing. Other income also reflects dividend income on cash equivalents as well as interest income. Refer to "Note 16 - Leases" and "Note 15 - Long-Term Debt"of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for further discussion of these items, as well as "Liquidity and Capital Resources-Indebtedness" for details on our loan commitments.
RESULTS OF OPERATIONS
Comparison of the Year Ended December 31, 2025 to the Year Ended December 31, 2024
The following table sets forth our Consolidated Statements of Operations information for the years ended December 31, 2025 and 2024.
For the years ended December 31,
dollars in thousands 2025 2024 Period Over Period Change ($) Period Over Period Change (%)
Revenues $ 122,830 $ 98,613 $ 24,217 25%
Cost of revenues:
Flight operations 31,933 31,016 917 3%
Maintenance 39,214 26,459 12,755 48%
Total cost of revenues 71,147 57,475 13,672 24%
Gross income 51,683 41,138 10,545 26%
Selling, general and administrative expenses 36,283 35,820 463 1%
Interest expense 23,263 23,714 (451) (2%)
Other income 11,788 2,067 9,721 470%
Income (loss) before income taxes 3,925 (16,329) 20,254 (124)%
Income tax benefit 215 762 (547) (72)%
Net income (loss) $ 4,140 $ (15,567) $ 19,707 (127%)
Revenues
Revenue increased by $24.2 million, or 25%, to $122.8 million for the year ended December 31, 2025, from $98.6 million for the year ended December 31, 2024.
Revenues by service offering for the years ended December 31, 2025 and 2024 were as follows:
For the years ended December 31,
dollars in thousands 2025 2024 Period Over Period Change ($) Period Over Period Change (%)
Fire suppression $ 79,840 $ 66,765 $ 13,075 20%
Aerial surveillance 17,426 13,062 4,364 33%
MRO 21,498 13,918 7,580 54%
Other services 4,066 4,868 (802) (16%)
Total revenues $ 122,830 $ 98,613 $ 24,217 25%
Fire suppression revenue increased by $13.1 million, or 20%, to $79.8 million for the year ended December 31, 2025, from $66.8 million for the year ended December 31, 2024. The increase was primarily driven by favorable rate increases for our Super Scoopers in the year ended December 31, 2025 compared to the year ended December 31, 2024.
Aerial surveillance revenue increased by $4.4 million, or 33%, to $17.4 million for the year ended December 31, 2025, from $13.1 million for the year ended December 31, 2024. The increase was primarily driven by increased flight hours for our surveillance aircraft for the year ended December 31, 2025 compared to the year ended December 31, 2024.
MRO revenue increased by $7.6 million, or 54%, to $21.5 million for the year ended December 31, 2025, from $13.9 million for the year ended December 31, 2024. The increase consisted of the return-to-service work performed on the Spanish Scoopers in connection with the MAB services agreement, and the revenues from maintenance and repair work performed by Flight Test & Mechanical Solutions, Inc. ("FMS"), which was acquired in June 2024. Refer to "Note 2 - Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details.
Other services revenue decreased by $0.8 million, or 16%, to $4.1 million for the year ended December 31, 2025, from $4.9 million for the year ended December 31, 2024. The decrease was primarily due to third-party training and flight operations services utilizing our aircraft for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Revenues by geographic area for the years ended December 31, 2025 and 2024 were as follows:
For the years ended December 31,
dollars in thousands 2025 2024 Period Over Period Change ($) Period Over Period Change (%)
United States $ 108,843 $ 88,527 $ 20,316 23%
Spain 13,987 10,086 3,901 39%
Total revenues $ 122,830 $ 98,613 $ 24,217 25%
United States revenue increased by $20.3 million, or 23%, to $108.8 million for the year ended December 31, 2025, from $88.5 million for the year ended December 31, 2024. The increase was primarily driven by increased utilization of our aircraft and maintenance and repair work performed by FMS.
Spain revenue increased by $3.9 million, or 39%, to $14.0 million for the year ended December 31, 2025, from $10.1 million for the year ended December 31, 2024. The increase is due to the return-to-service work performed on the Spanish Scoopers in connection with the MAB services agreement. Refer to "Note 2 - Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details.
Cost of Revenues
Total cost of revenues increased by $13.7 million, or 24%, to $71.1 million for the year ended December 31, 2025, from $57.5 million for the year ended December 31, 2024.
Flight Operations
Flight operations costs increased by $0.9 million, or 3%, to $31.9 million for the year ended December 31, 2025, from $31.0 million for the year ended December 31, 2024. The increase reflects higher activity levels and associated personnel, travel, and equipment costs necessary to support operational growth of $3.0 million. The increase was partially offset by a decrease in depreciation expense of $2.1 million for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Maintenance
Maintenance costs increased by $12.8 million, or 48%, to $39.2 million for the year ended December 31, 2025, from $26.5 million for the year ended December 31, 2024. The increase was primarily due to the return-to-service work performed on the Spanish Scoopers in connection with the MAB services agreement and maintenance and repair work performed by FMS, and reflects higher aircraft servicing requirements, workforce costs, and facility expenses contributing to the overall increase of $15.7 million. The increase was partially offset by a decrease in certain maintenance support fees, that did not recur as the program was not renewed, of $2.9 million for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Selling, General and Administrative Expense
Selling, general and administrative expense increased by $0.5 million, or 1%, to $36.3 million for the year ended December 31, 2025, from $35.8 million for the year ended December 31, 2024. The increase was primarily attributable to a change in the fair value of the Warrants, which resulted in a $4.3 million loss in 2025 compared to a $4.5 million gain in 2024, an $8.8 million unfavorable year over year variance and an increase of non-recurring organizational development costs of $0.4 million. The increase was partially offset by a decrease in stock-based compensation of $8.7 million associated with the RSUs issued to senior management and employees of Bridger for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Interest Expense
Interest expense decreased by $0.5 million, or 2%, to $23.3 million for the year ended December 31, 2025, from $23.7 million for the year ended December 31, 2024. The decrease was driven by favorable changes in financing terms related to the October 2025 debt refinancing.
Other Income
Other income increased by $9.7 million, or 470%, to $11.8 million for the year ended December 31, 2025, from $2.1 million for the year ended December 31, 2024. The increase was primarily attributable to a gain of $16.9 million related to the sale-leaseback transaction involving the hangar and office facilities described in "Note 16 - Leases" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K. This increase was partially offset by a loss of $7.2 million on the extinguishment of debt related to the October 2025 debt refinancing, in each case for the year December 31, 2025 compared to the year ended December 31, 2024. Refer to "Note 15 - Long-Term Debt" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details.
Income Tax Benefit
Income tax benefit of $0.2 million for the year ended December 31, 2025, was primarily a function of the provision to return adjustments for the 2024 tax year offset by state taxes.
NON-GAAP FINANCIAL MEASURES
Although we believe that net income or loss, as determined in accordance with GAAP, is the most appropriate earnings measure, we use EBITDA and Adjusted EBITDA as key profitability measures to assess the performance of our business. We believe these measures help illustrate underlying trends in our business and use the measures to establish budgets and operational goals, and communicate internally and externally, in managing our business and evaluating its performance. We also believe these measures help investors compare our operating performance with its results in prior periods in a way that is consistent with how management evaluates such performance.
Each of the profitability measures described below is not recognized under GAAP and does not purport to be an alternative to net income or loss determined in accordance with GAAP as a measure of our performance. Such measures have limitations as analytical tools, and should not be considered in isolation or as substitutes for our results as reported under GAAP. EBITDA and Adjusted EBITDA exclude items that can have a significant effect on our profit or loss and should, therefore, be used only in conjunction with our GAAP profit or loss for the period. Our management compensates for the limitations of using non-GAAP financial measures by using them to supplement GAAP results to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone. Because not all companies use identical calculations, these measures may not be comparable to other similarly titled measures of other companies.
EBITDA and Adjusted EBITDA
EBITDA is a non-GAAP profitability measure that represents net income or loss for the period before the impact of interest expense, income tax benefit and depreciation and amortization of property, plant and equipment and intangible assets. EBITDA eliminates potential differences in performance caused by variations in capital structures (affecting financing expenses), the cost and age of tangible assets (affecting relative depreciation expense) and the extent to which intangible assets are identifiable (affecting relative amortization expense).
Adjusted EBITDA is a non-GAAP profitability measure that represents EBITDA before certain items that are considered to hinder comparison of the performance of our businesses on a period-over-period basis or with other businesses. During the periods presented, we exclude from Adjusted EBITDA certain costs that are required to be expensed in accordance with GAAP, including non-cash stock-based compensation, business development and integration expenses, offering costs, non-cash adjustments to the fair value of earnout consideration and non-cash adjustments to the fair value of Warrants issued in connection with the Reverse Recapitalization. Our management believes that the inclusion of supplementary adjustments to EBITDA applied in presenting Adjusted EBITDA are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future.
The reconciliation of Net income (loss), the most directly comparable GAAP measure, to EBITDA and Adjusted EBITDA for the years ended December 31, 2025 and 2024 is as follows:
For the years ended December 31,
dollars in thousands 2025 2024 Period Over Period Change ($) Period Over Period Change (%)
Net income (loss) $ 4,140 $ (15,567) $ 19,707 (127%)
Income tax benefit
(215) (762) 547 (72%)
Depreciation and amortization 15,471 17,451 (1,980) (11%)
Interest expense 23,263 23,714 (451) (2%)
EBITDA 42,659 24,836 17,823 72%
Stock-based compensation1
7,720 16,160 (8,440) (52%)
Business development & integration expenses2
1,648 1,140 508 45%
Change in fair value of earnout consideration3
(2,285) (393) (1,892) 481%
Change in fair value of Warrants4
4,264 (4,530) 8,794 (194%)
Offering costs5
440 123 317 258%
Non-cash impairment charges6
178 - 178 100%
Gain on non-recurring transactions7
(9,738) - (9,738) 100%
Non-recurring organizational development costs8
392 - 392 100%
Adjusted EBITDA $ 45,278 $ 37,336 $ 7,942 21%
Net income (loss) margin9
3 % (16) %
Adjusted EBITDA margin9
37 % 38 %
1 Represents non-cash stock-based compensation expense associated with employee and non-employee equity awards.
2 Represents expenses related to integration costs for completed acquisitions and expenses related to potential acquisition targets and additional business lines.
3 Represents non-cash fair value adjustment for earnout consideration issued in connection with the acquisitions of Ignis Technologies, Inc. ("Ignis") and FMS.
4 Represents the non-cash fair value adjustment for Warrants issued in connection with Reverse Recapitalization.
5 Represents one-time costs for professional service fees related to the preparation for potential offerings that have been expensed during the period.
6 Represents non-cash impairment charges on aircraft.
7 Represents the net effect from the October 2025 debt refinancing and sale-leaseback transactions completed during the period.
8 Represents expenses associated with the build out of the executive leadership team.
9 Net income (loss) margin represents Net income (loss) divided by Total revenue and Adjusted EBITDA margin represents Adjusted EBITDA divided by Total revenue.
LIQUIDITY AND CAPITAL RESOURCES
For the year ended December 31, 2025, the Company had net income of $4.1 million and cash flow provided by operating activities of $16.7 million. In addition, as of December 31, 2025, the Company had unrestricted cash of $31.4 million.
On March 18, 2025, the Company entered into a sales agreement ("2025 ATM Agreement") under which we may offer and sell, from time to time, shares of our Common Stock having an aggregate offering price of up to $100.0 million by any method permitted by law and deemed to be an "at the market offering" as defined in Rule 415 promulgated under the Securities Act, including sales made directly on or through the Nasdaq Global Market, or any other existing trading market for such shares or in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices by any method permitted by law and deemed to be an "at the market offering" as defined in Rule 415 promulgated under the Securities Act, including sales made directly on or through the Nasdaq Global Market, or any other existing trading market for such shares or in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices. As of March 3, 2026, $100.0 million remains available for potential future sales under the 2025 ATM Agreement, which may be utilized for future financings under our effective shelf registration statement. Refer to "Note 19 - Stockholders' Deficit" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K.
Cash and Marketable Securities
As of December 31, 2025, our principal sources of liquidity were cash and cash equivalents of $31.4 million which were held for working capital purposes. From time to time, the Company invests its excess cash in highly rated available-for-sale securities, with the primary objective of minimizing the potential risk of principal loss.
We may receive up to $306.5 million from the exercise of the 9,400,000 private placement warrants and 17,249,874 public warrants of the Company outstanding (collectively, the "Warrants"), assuming the exercise in full of all the Warrants for cash, but not from the sale of the shares of Common Stock issuable upon such exercise. On December 31, 2025, the closing price of our Common Stock was $1.83 per share. For so long as the market price of our Common Stock is below the exercise price of our Warrants ($11.50 per share), our Warrants remain "out-of-the money," and holders of our Warrants are unlikely to cash exercise their Warrants, resulting in little or no cash proceeds to us. There can be no assurance that our Warrants will be in the money prior to their January 24, 2028 expiration date, and therefore, we may not receive any cash proceeds from the exercise of our Warrants to fund our operations. Accordingly, we have not relied on the receipt of proceeds from the exercise of our Warrants in assessing our capital requirements and sources of liquidity.
We may in the future seek to raise additional funds through various potential sources, such as equity and debt financing for general corporate purposes or for specific purposes, including in order to pursue growth initiatives. Based on our unrestricted cash and cash equivalents balance as of December 31, 2025, and our projected cash use, we would anticipate the need to raise additional funds through equity or debt financing (or the issuance of stock as acquisition consideration) to pursue any significant acquisition opportunity, at the time of such acquisition opportunity. Our ability to generate proceeds from equity financings will significantly depend on the market price of our Common Stock.
We believe our cash on hand, cash expected to be generated from operating activities and available borrowing capacity under the Credit Agreement will be sufficient to fund our operations for the next twelve months. As described in "Item 1A. Risk Factors"included in this Annual Report on Form 10-K, our quarterly and annual operating results have fluctuated in the past and may vary in the future due to a variety of factors, many of which are external to our control. If the conditions in our industry deteriorate (such as due to the seasonality of our business), or if we are unable to sufficiently increase our revenues or further reduce our expenses, we may experience, in the future, a significant negative impact to our financial results and cash flows from operations. In such a situation, we could need to seek liquidity from sources other than our operations.
Indebtedness
October 2025 Refinancing
In October 2025, the Company completed a comprehensive refinancing designed to strengthen its liquidity profile and extend its debt maturity schedule. On October 28, 2025, the Company replaced its then-outstanding $160.0 million Series 2022 Bonds with a new Credit Agreement providing for (i) $210.0 million in Initial Term Loans, (ii) a $21.5 million Revolving Credit Facility ("Revolver"), and (iii) a $100.0 million Delayed Draw Term Loan ("DDTL"). The transaction increased total borrowing capacity and reduced near-term refinancing risk. The Company incurred approximately $9.1 million in debt issuance costs and lender fees in connection with the new facilities.
Proceeds from the refinancing, together with $9.3 million of restricted cash previously held for debt service, were used to (i) repay the Series 2022 Bonds, including the 3% prepayment penalty, (ii) retire the UMB Bank loan of $9.3 million, and (iii) settle two credit facilities with Live Oak Bank totaling approximately $33.7 million. The refinancing resulted in a loss on extinguishment of debt of $7.8 million, which includes a write off of $3.0 million in unamortized issuance costs. Refer to "Note 15 - Long-Term Debt" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details.
The refinancing improved the Company's liquidity position by consolidating multiple obligations into a single credit structure with extended maturities and more flexible covenant terms. Management believes the transaction provides sufficient liquidity to fund near-term operating needs and supports the Company's long-term growth plan. As of December 31, 2025, the Company had drawn $210.0 million on the Initial Term Loans and $10.3 million under the DDTL, with remaining availability of $89.7 million on the DDTL and $21.5 million on the undrawn Revolver.
Credit Agreement Overview
The Credit Agreement is secured by first-priority liens on substantially all tangible and intangible assets of the Company and its material subsidiaries, including aircraft, real property, and intellectual property. The agreement includes customary mandatory prepayment provisions, including annual prepayments based on a percentage of Excess Cash Flow, beginning with the fiscal year ending December 31, 2026, and from certain asset sale proceeds, subject to reinvestment rights.
The agreement also provides for prepayment premiums of 3.0%, 2.0%, and 1.0% if loans are repaid within one, two, or three years, respectively, after the closing date, with no premium thereafter. Events of default include nonpayment, covenant breaches, insolvency, and cross-defaults, which may result in acceleration of outstanding obligations.
The Credit Agreement contains customary restrictive covenants limiting additional indebtedness, liens, asset sales, dividends, and investments. The Credit Agreement also includes financial covenants requiring the Company to maintain:
•A Total Leverage Ratio not to exceed 7.00x through December 31, 2026, decreasing to 6.00x for the periods ending March 31, 2027 through December 31, 2027, and 5.50x thereafter; and
•Minimum Operating Cash Flow (as defined in the agreement) of at least $30.0 million.
The Company was in compliance with all covenants under the Credit Agreement as of December 31, 2025.
The Credit Agreement consists of the following three instruments:
Initial Term Loans
The Initial Term Loans totaled $210.0 million at issuance and mature on October 28, 2030. Borrowings bear interest, at the Company's election, at either (i) the Term SOFR rate plus 6.00%, or (ii) the Alternate Base Rate ("ABR") plus 5.00%, where the ABR is defined as the highest of the federal funds effective rate plus 0.50%, the adjusted Term SOFR rate plus 1.00%, the prime rate, or 2.00%. The Company elected the Term SOFR plus 6.00% option at inception.
Principal amortizes quarterly at 0.25% of the original principal balance, with the remaining outstanding balance due at maturity. Interest is payable at the end of the interest period.
Revolving Credit Facility
The $21.5 million Revolver allows for borrowings, repayments, and re-borrowings through its maturity on October 28, 2030. Revolving loans bear interest at the same rate options as the Initial Term Loans. The Company had no outstanding borrowings under the Revolver as of December 31, 2025.
Delayed Draw Term Loan ("DDTL")
The DDTL provides up to $100.0 million in additional term loan commitments, available through October 28, 2027. Draws are permitted in up to ten tranches of at least $2.5 million each, subject to customary conditions precedent. Amounts drawn under the DDTL mature on October 28, 2030. Borrowings under the DDTL bear interest at the same rate options applicable to the Initial Term Loans. As of December 31, 2025, the Company had drawn $10.3 million, with $89.7 million remaining available under the facility.
Other Indebtedness
UMB Bank ("UMB") Loan - On February 3, 2020, the Company entered into a credit facility with UMB (formerly known as Rocky Mountain Bank) to finance the purchase of four aircraft, issuing a $5.6 million promissory note with a ten-year amortization and interest equal to one-month SOFR plus 2.61448%. Debt issuance costs totaled $0.1 million. The facility includes financial covenants requiring a Debt Service Coverage Ratio ("DSCR") greater than 1.25x and a Senior Leverage Ratio not exceeding 5.50x after the third quarter of 2025. The Company was in compliance with all such covenants as of December 31, 2025. On February 24, 2026, the Company obtained an amendment from the lender pursuant to which the December 31, 2025 financial covenants and all future financial covenant requirements under the loan were permanently removed through maturity.
Other Loans - The Company also maintains several smaller term loans with immaterial aggregate principal balances. These loans bear fixed interest rates of 3.89% to 5.50% and mature at various dates through November 17, 2027.
Mezzanine and Permanent Equity
Preferred Shares
Shares of Series A Preferred Stock are mandatorily redeemable by the Company on April 25, 2032 at a redemption amount that is equal to the stated value, plus accrued but unpaid interest. Shares of Series A Preferred Stock are also redeemable upon certain triggering events outside of the control of the Company, including that shares of Series A Preferred Stock may be redeemed by the Company (a) on or after April 25, 2027 or (b) in connection with the consummation of a fundamental change in the Company's voting and governance structure such as the sale of the Company or its subsidiaries representing more than 50% of the Company's voting stock or a similar liquidity event. Shares of Series A Preferred Stock may be redeemed by the holder upon the consummation of a fundamental change, such as the sale of the Company or a similar liquidity event.
Given there is a conversion feature, which is considered substantive, the mandatory redemption on April 25, 2032 is not certain and accordingly, the Series A Preferred Stock are classified as mezzanine equity. For additional information regarding the terms and conditions of the Series A Preferred Stock, see "Note 18 - Mezzanine Equity"for additional details.
As of December 31, 2025, it was probable that the Series A Preferred Stock may become redeemable on April 25, 2032. As of December 31, 2025, the Series A Preferred Stock had a carrying value and redemption value of $407.3 million.
Historical Cash Flows
Our consolidated cash flows from operating, investing and financing activities for the years ended December 31, 2025 and 2024 were as follows:
For the years ended December 31,
dollars in thousands 2025 2024
Net cash provided by operating activities $ 16,732 $ 9,355
Net cash (used in) provided by investing activities (34,443) 2,056
Net cash (used in) provided by financing activities (4,320) 4,673
Effects of exchange rate changes 329 62
Net change in cash and cash equivalents $ (21,702) $ 16,146
Operating Activities
Net cash provided by operating activities was $16.7 million for the year ended December 31, 2025, compared to Net cash provided by operating activities of $9.4 million for the year ended December 31, 2024. Net cash provided by operating activities reflects Net income of $4.1 million for the year ended December 31, 2025 compared to Net loss of $15.6 million for the year ended December 31, 2024. Net cash provided by operating activities for the year ended December 31, 2025 reflects add-backs to Net income for non-cash charges totaling $15.6 million, primarily attributable to depreciation and amortization of $15.5 million, a loss on debt extinguishment of $7.8 million, and stock-based compensation expense of $7.1 million, and partially offset by the gain on sale of fixed assets, primarily driven by the sale-leaseback, of $16.9 million. Net cash provided by operating activities for the year ended December 31, 2024 reflects add-backs to Net loss for non-cash charges totaling $28.0 million, primarily attributable to depreciation and amortization of $17.5 million, stock-based compensation expense of $16.2 million, and partially offset by the change in fair value of the Warrants of $4.5 million.
Investing Activities
Net cash used in investing activities was $34.4 million for the year ended December 31, 2025, compared to Net cash provided by investing activities of $2.1 million for the year ended December 31, 2024. Net cash used in investing activities for the year ended December 31, 2025 reflects purchases of property, plant and equipment of $80.9 million, which is primarily comprised of aircraft purchases and aircraft improvements and partially offset by proceeds from the sale-leaseback transaction of $46.8 million. Net cash provided by investing activities for the year ended December 31, 2024 reflects the collection of cash from note receivable of $3.0 million, cash acquired through the FMS Acquisition of $2.6 million, and proceeds from sales and maturities of marketable securities of $1.1 million, partially offset by purchases of property, plant and equipment of $4.1 million, which is primarily comprised of purchases, aircraft improvements and expenditures for capitalized software of $1.2 million.
Financing Activities
Net cash used in financing activities was $4.3 million for the year ended December 31, 2025, compared to Net cash provided by financing activities of $4.7 million for the year ended December 31, 2024. Net cash used in financing activities for the year ended December 31, 2025 primarily reflects repayments related to the October 2025 refinancing of $210.9 million and payments of issuance costs related to the October 2025 refinancing of $13.9 million, partially offset by net proceeds from issuance of term loans of $220.3 million. Net cash provided by financing activities for the year ended December 31, 2024 primarily reflects repayments on debt of $3.0 million and payment of issuance costs for Common Stock in offerings of $1.0 million.
Contractual Obligations
Our principal commitments consist of obligations for outstanding leases and debt. The following table summarizes our contractual obligations as of December 31, 2025:
Payments Due by Period
dollars in thousands
Total Current Noncurrent
Lease obligations
$ 31,642 $ 2,406 $ 29,236
Debt obligations
222,493 2,836 219,657
Total
$ 254,135 $ 5,242 $ 248,893
On November 17, 2023, the Company entered into a series of agreements with MAB and its subsidiary designed to facilitate the purchase and return-to-service of four Spanish Scoopers originally awarded to the Company in September 2023 via a public tender process from the Government of Spain. The terms of the agreements provide that the Company will manage the return-to-service upgrades of the Spanish Scoopers while they are owned and funded by MAB. The Company has the right, but not the obligation, to acquire each plane as it is ready to be contracted and returned to service. In the event that the Company does not purchase the aircraft within the time periods set forth in the agreements, then either party may initiate a sales process for the sale of all aircraft that have not been purchased by the Company, which sales process the Company will oversee and manage. If the aircraft are sold to a third party through such process, then the Company must pay the MAB's subsidiary a cash fee equal to the amount, if any, by which the aggregate price of the Company's purchase options for such aircraft exceeds the consideration paid by the third-party purchaser for the same aircraft, not to exceed $15.0 million in aggregate. If the aircraft are not sold to a third party and MAB's subsidiary has not otherwise entered into an operating lease with a third party for the aircraft, then the Company must pay MAB's subsidiary $15.0 million. On December 23, 2025, we purchased two of the Spanish Scoopers from MAB for an aggregate purchase price of $50.0 million, allocated $25.0 million per aircraft. Accordingly, no liability has been recorded in the consolidated financial statements as of December 31, 2025. The Company will continue to monitor the situation and assess the need for recognition or further disclosure in future periods.
Off-Balance Sheet Arrangements
On November 17, 2023, we entered into a series of agreements designed to facilitate the purchase and return-to-service of the Spanish Scoopers originally awarded to the Company's wholly-owned subsidiary, BAE, in September 2023 via a public tender process from the Government of Spain for €40.3 million. Under the terms of the agreements, we agreed to sell our entire outstanding equity interest in BAE to MAB and purchase $4.0 million of non-voting Class B units of MAB. We also entered into a services agreement with MAB whereby we will manage the return-to-service upgrades of the Spanish Scoopers through the Company's wholly-owned Spanish subsidiary, Albacete Aero, S.L., while they are owned and funded by MAB. The service agreement also provides that we have the right, but not the obligation, to acquire each Spanish Scooper as it is ready to be contracted and returned to service. On December 23, 2025, we purchased two of the Spanish Scoopers from MAB for an aggregate purchase price of $50.0 million, allocated $25.0 million per aircraft. The Company assessed both MAB and BAE for variable interest entity accounting under ASC 810-10-15 and determined that MAB is a voting interest entity and BAE is a variable interest entity. However, neither entity is consolidated in the Consolidated Financial Statements as the Company does not have a controlling financial interest in MAB and the Company is not the primary beneficiary of BAE.
As of December 31, 2025 and 2024, we did not have any other relationships with special purpose or variable interest entities which have been established for the purpose of facilitating off-balance sheet arrangements, which have not been consolidated in the Consolidated Financial Statements of the Company. Refer to "Note 2 - Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional information.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Our Consolidated Financial Statements and the related notes included elsewhere in this Annual Report on Form 10-K are prepared in accordance with GAAP. The preparation of these Consolidated Financial Statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses, provision for income taxes and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Changes in accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ significantly from the estimates made by our management. We evaluate our estimates and assumptions on an ongoing basis. To the extent that there are material differences between these estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected.
We believe that the following critical accounting policies involve a greater degree of judgment or complexity than our other accounting policies. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations.
Revenue Recognition
We enter into short, medium and long-term contracts with customers, primarily with government agencies to deploy aerial fire management assets during the firefighting season. Contracts with our customers generally include a termination for convenience clause. The majority of our contracts are started and completed within the same year. We recognize revenue under Accounting Standards Codification 606, "Revenue from Contracts with Customers" ("ASC 606"), which utilizes a five-step model.
The definition of a contract for us is typically defined as a customer purchase order as this is when we achieve an enforceable right to payment. The deliverables within a customer purchase order are analyzed to determine the number of performance obligations.
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account under ASC 606. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, control is transferred and the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services are highly interrelated or meet the series guidance. For contracts with multiple performance obligations, we allocate the contract transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. The primary method used to estimate the standalone selling price is the expected cost plus a margin approach, under which we forecast our expected costs of satisfying a performance obligation and then add an appropriate margin for that distinct good or service.
For Aerial firefighting contracts, the Company primarily performs the following activities as part of a stand-ready obligation: (i) providing our aircraft, pilot, and field maintenance personnel necessary to operate the aircraft and (ii) performing the services required on the contract, whether it be fire suppression or aerial surveillance services. The integrated firefighting services that we perform under each contract represent a single performance obligation satisfied over time, as a series of distinct time increments. The amounts billed to the customer are determined based on varying rates applicable to the specific activities performed on a daily basis. Such consideration is allocated to the distinct daily increment it relates to within the contract and therefore, recognized as we perform the daily firefighting services on the contract. We utilize the output method to recognize revenue over time as this depicts the Company's performance toward complete satisfaction of the performance obligation.
Maintenance repair revenue consists of maintenance repair and return to service work performed on customer aircraft. For maintenance repair contracts, we manufacture products to customer specifications and the product cannot be easily modified to satisfy another customer's order or we perform return-to-service work on customer aircraft. As such, these products are deemed to have no alternative use once the manufacturing process begins. In the event the customer invokes a termination for convenience clause, we would be entitled to costs incurred to date plus a reasonable profit. Contract costs typically include labor, materials, overhead, and when applicable, subcontractor costs. For most of our products, we are building assets with no alternative use and have enforceable right to payment, and thus, we recognize revenue using the over-time method. For return to service contracts, the customer maintains control of the asset as we perform the services.
The majority of our performance obligations are satisfied over time as work progresses. Typically, revenue is recognized over time using an input measure (i.e., costs incurred to date relative to total estimated costs at completion, also known as cost-to-cost plus reasonable profit) to determine progress.
Contract estimates are based on various assumptions to project the outcome of future events that can span multiple months or years. These assumptions include labor productivity and availability; the complexity of the work to be performed; the cost and availability of materials; and the performance of subcontractors.
As a significant change in one or more of these estimates could affect the progress completed (and related profitability) on our MRO contracts, we review and update our contract-related estimates on a regular basis. We recognize such adjustments under the cumulative catch-up method. Under this method, the impact of the adjustment is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. The impact of adjustments in contract estimates on our operating earnings can be reflected in either operating costs and expenses or revenue.
Business Combinations
The Company records tangible and intangible assets acquired and liabilities assumed in business combinations under the acquisition method of accounting in accordance with ASC 805, Business Combinations. Under the acquisition method of accounting, amounts paid for the acquisition are allocated to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition inclusive of identifiable intangible assets. Acquisition consideration includes contingent consideration with payment terms based on the achievement of certain targets of the acquired business. The estimated fair value of identifiable assets and liabilities, including intangibles, are based on valuations that use information and assumptions available to management. The Company allocates any excess purchase price over the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed to goodwill. Significant management judgments and assumptions are required in determining the fair value of assets acquired and liabilities assumed, particularly acquired intangible assets, including estimated useful lives. The valuation of purchased intangible assets is based upon estimates of the future performance and discounted cash flows of the acquired business. Each asset acquired or liability assumed is measured at estimated fair value from the perspective of a market participant.
Contingent consideration represents an obligation of the acquirer to transfer additional assets or equity interests to the seller if future events occur or conditions are met and is recognized when probable and reasonably estimable. Contingent consideration recognized is included in the initial cost of the assets acquired. Subsequent changes in the estimated fair value of contingent consideration are recognized as Selling, general and administrative expenses within the Consolidated Statements of Operations.
Stock-Based Compensation
In January 2023, the Company along with its board of directors established and approved and assumed the Bridger Aerospace Group Holdings, Inc. 2023 Omnibus Incentive Plan (the "Omnibus Plan"). The Omnibus Plan was developed to motivate and reward employees and other individuals to perform at the highest level and contribute significantly to the success of the Company, thereby furthering the best interests of the Company and its shareholders. The Omnibus Plan provides, among other things, the ability for the Company to grant options, stock appreciation rights, restricted stock, RSUs, performance awards and other stock-based and cash-based awards to employees, consultants and non-employee directors.
The Omnibus Plan expires on January 23, 2033. As of December 31, 2025, the Omnibus Plan authorized an aggregate of 17,078,863 shares of Common Stock for issuance, of which 15,099,137 shares are currently registered for issuance. As of December 31, 2025, 7,517,915 shares of Common Stock remain available under the Omnibus plan, of which, 5,538,189 shares of Common Stock are currently registered for issuance.
As of December 31, 2025, the Company has granted participants RSUs and bonuses paid in Common Stock under the Omnibus Plan. The fair value of RSUs is determined based on the quoted market price of the Common Stock on the date of grant. Compensation cost for the RSUs is recognized over the requisite service period based on a graded-vesting method. The Company accounts for forfeitures as they occur. Stock-based compensation is included in both Cost of revenues and Selling, general and administrative expense in the Consolidated Statements of Operations. Upon vesting of each RSU, the Company will issue one share of Common Stock to the RSU holder.
Impairment of Goodwill and Long-Lived Assets
Goodwill
Goodwill represents the excess of purchase price over fair value of the net assets acquired in an acquisition. The Company assesses goodwill for impairment as of October 1 annually or more frequently upon an indicator of impairment.
When we elect to perform a qualitative assessment and conclude it is more likely that the fair value of the reporting unit is greater than its carrying value, no further assessment of that reporting unit's goodwill is necessary. Otherwise, a quantitative assessment is performed, and the fair value of the reporting unit is determined. If the carrying value of the reporting unit exceeds its fair value, an impairment loss equal to the excess is recorded. Conditions that would trigger an impairment assessment include, but are not limited to, a significant adverse change in legal factors or the business climate that could affect the value of an asset or an adverse reaction. As of the October 1, 2025 and 2024 annual goodwill impairment tests, the Company's qualitative analysis indicated the fair value of the Company's reporting units exceeded carrying value.
Long-Lived Assets
A long-lived asset (including amortizable identifiable intangible assets) or asset group is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset, or an adverse action or assessment by a regulator. When indicators of impairment are present, we evaluate the carrying value of the long-lived assets in relation to the operating performance and future undiscounted cash flows of the underlying assets. We adjust the net book value of the long-lived assets to fair value if the sum of the expected future cash flows is less than book value.
Property, Plant and Equipment, net
Property, plant and equipment is stated at net book value, cost less depreciation. Depreciation for aircraft, engines and rotable parts is recorded over the estimated useful life based on flight hours. Depreciation for vehicles and equipment, buildings and leasehold improvements is computed using the straight-line method over the estimated useful lives of the property, plant and equipment. Airplane hangars located on leased airport property are considered leasehold improvements with useful lives determined based on the estimated life of the underlying ground lease. Depreciable lives by asset category are as follows:
Estimated useful life
Aircraft, engines and rotable parts
1,500 - 6,000 flight hours
Vehicles and equipment 3 - 5 years
Buildings 50 years
Leasehold improvements
10 years
Property, plant and equipment are reviewed for impairment as discussed above under "Long-Lived Assets".
Investments
We hold equity securities without a readily determinable fair value, which are only adjusted for observable price changes in orderly transactions for the same or similar equity securities or any impairment, totaling $5.5 million and $5.0 million as of December 31, 2025 and 2024, respectively.
Variable Interest Entities
The Company follows ASC 810-10-15, Consolidation, guidance with respect to accounting for variable interest entities ("VIE"). These entities do not have sufficient equity at risk to finance their activities without additional subordinated financial support from other parties or whose equity investors lack any of the characteristics of a controlling financial interest. A variable interest is an investment or other interest that will absorb portions of a VIE's expected losses or receive portions of its expected returns and are contractual, ownership, or pecuniary in nature and that change with changes in the fair value of the entity's net assets. A reporting entity is the primary beneficiary of a VIE and must consolidate it when that party has a variable interest, or combination of variable interests, that provide it with a controlling financial interest. A party is deemed to have a controlling financial interest if it meets both of the power and loss/benefits criteria. The power criterion is the ability to direct the activities of the VIE that most significantly impact its economic performance. The losses/benefits criterion is the obligation to absorb losses from, or right to receive benefits from, the VIE that could potentially be significant to the VIE. The VIE model requires an ongoing reconsideration of whether a reporting entity is the primary beneficiary of a VIE due to changes in the facts and circumstances. For the years ended December 31, 2025 and 2024, Northern Fire Management Services, LLC, a VIE of which the Company was identified as the primary beneficiary, is consolidated into our financial statements. Refer to "Note 2 - Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional information.
Fair Value of Financial Instruments
We follow guidance in ASC 820, Fair Value Measurement, where fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are determined within a framework that establishes a three-tier hierarchy which maximizes the use of observable market data and minimizes the use of unobservable inputs to establish a classification of fair value measurements for disclosure purposes. Inputs may be observable or unobservable. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of our business. Unobservable inputs reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability based on the information available.
Warrant Liabilities
We account for the Warrants issued in connection with the Reverse Recapitalization in accordance with the guidance contained in accordance with ASC 480, Distinguishing Liabilities from Equityand ASC 815-40, Derivatives and Hedging-Contracts in Entity's Own Equity, under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, we classify the Warrants as liabilities at their fair value and adjust the Warrants to fair value at each reporting period. The warrant liabilities are subject to remeasurement at each balance sheet date until exercised. Refer to "Note 12 - Accrued Expenses and Other Liabilities" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for additional information.
Sale-Leaseback Transaction
The determination of the fair value of the property related to the sale-leaseback transaction requires subjectivity and estimates, including the use of multiple valuation techniques and uncertain inputs, such as market price per square foot and assumed capitalization rates or the replacement cost of the assets, where applicable. Where real estate valuation expertise is required, we obtain independent third-party appraisals to determine the fair value of the underlying asset. While determining fair value requires a variety of input assumptions and judgment, we believe our estimates of fair value are reasonable.
Income Taxes
We are subject to income taxes in the United States and other jurisdictions in which we conduct business. Our income tax provision consists of an estimate of federal, state and foreign income taxes based on enacted federal, state and foreign tax law, including allowable credits, deductions, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws.
Significant judgment is required in evaluating our tax positions and in determining income tax benefit (expense), deferred tax assets and liabilities, and any valuation allowance recorded against our deferred tax assets. We evaluate the recoverability of deferred tax assets based on available evidence. This process involves significant management judgment about assumptions that are subject to change from period to period based on changes in tax laws or variances between future projected operating performance and actual results. Under GAAP, we establish a valuation allowance for deferred tax assets if we determine, based on available evidence at the time the determination is made, that it is more likely than not (defined as a likelihood of more than 50%) that all or a portion of the deferred tax assets will not be realized. In making this determination, we evaluate all positive and negative evidence as of the end of each reporting period. Future adjustments (either increases or decreases) to the deferred tax asset valuation allowance are determined based upon changes in the expected realization of the net deferred tax assets. The realization of the deferred tax assets ultimately depends on the existence of sufficient taxable income or tax liability in either the carry-back or carry-forward periods under the tax law. Due to significant estimates used to establish the valuation allowance and the potential for changes in facts and circumstances, it is reasonably possible that we will be required to record additional adjustments to the valuation allowance in future reporting periods that could have a material effect on our results of operations.
RECENT ACCOUNTING PRONOUNCEMENTS
For additional information regarding recent accounting pronouncements adopted and under evaluation, refer to "Note 2 - Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K.
EMERGING GROWTH COMPANY AND SMALLER REPORTING COMPANY STATUS
Section 102(b)(1) of the JOBS Act exempts "emerging growth companies" as defined in Section 2(A) of the Securities Act of 1933, from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. We are an "emerging growth company" and have elected to take advantage of the benefits of this extended transition period.
We will use this extended transition period for complying with new or revised accounting standards that have different effective dates for public business entities and non-public business entities until the earlier of the date that we (a) are no longer an emerging growth company or (b) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. The extended transition period exemptions afforded by our emerging growth company status may make it difficult or impossible to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of this exemption because of the potential differences in accounting standards used. Refer to "Note 2 - Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for the recent accounting pronouncements adopted and the recent accounting pronouncements not yet adopted for the years ended December 31, 2025 and 2024.
We will remain an "emerging growth company" under the JOBS Act until the earliest of (a) December 31, 2028, (b) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (c) the last date of our fiscal year in which we are deemed to be a "large accelerated filer" under the rules of the U.S. Securities and Exchange Commission with at least $700.0 million of outstanding securities held by non-affiliates or (d) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years.
We will be a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of our common stock held by non-affiliates is greater than or equal to $250 million as of the end of that fiscal year's second fiscal quarter, and (ii) our annual revenues are greater than or equal to $100 million during the last completed fiscal year or the market value of our common stock held by non-affiliates exceeds $700 million as of the end of that fiscal year's second fiscal quarter.
Bridger Aerospace Group Holdings Inc. published this content on March 06, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on March 06, 2026 at 21:12 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]