ZenaTech Amends 20-F to Disclose $33M Drone Tech Acquisition, Active ATM Dilution, and Internal Control Weakness

summarizeSummary

ZenaTech filed an amended 20-F disclosing a $33M drone technology acquisition, ongoing share issuance under its ATM program, and a material weakness in internal controls, alongside a new, substantial CEO compensation package.

check_boxKey Events

• Significant Drone Technology Acquisition Completed

  ZenaTech completed the acquisition of various drone technology assets from related party Epazz, Inc. for $33,000,000 (CAD) in Preferred and Super Voting Shares on January 30, 2026. This includes PIN Technology, ZD1000 Design Gen 4, ZD1000 Spraying Module, IQ Octo Drone, IQ Aqua, and Spraying Trailer Platform.

• Aggressive DaaS Expansion Continues

  The company completed 21 acquisitions of land surveying and related service businesses in 2025, and two more (Andy Paris & Associates for US$1.2M, NOW Solutions) in April 2026, expanding its Drone as a Service (DaaS) footprint. It also has a definitive agreement for an AUD$6.75M Australian land surveying company and several other Letters of Intent.

• Ongoing Dilutive Financing via ATM Program

  ZenaTech has issued Common Shares under its At-The-Market (ATM) offering facility between February 6, 2026, and April 28, 2026, indicating ongoing dilution to fund operations and acquisitions. The ATM program was authorized for up to $75 million.

• Material Weakness in Internal Controls Identified

  Management identified a material weakness in internal control over financial reporting as of December 31, 2025, attributing it to the rapid expansion in the drone sector, which contributed to the need for this amended filing.

auto_awesomeAnalysis

This amended annual report provides critical updates on ZenaTech's aggressive expansion strategy and associated financial activities, which were previously omitted. The company is undergoing a rapid transformation, significantly growing its Drone as a Service (DaaS) segment through numerous acquisitions, including a substantial $33 million (CAD) drone technology acquisition from a related party. This expansion, while driving revenue growth, is also contributing to a soaring net loss and increasing debt, with financing heavily reliant on dilutive equity offerings like the active At-The-Market program. The disclosure of a material weakness in internal controls, stemming from this rapid growth, raises concerns about financial reporting reliability. Furthermore, the new CEO employment agreement includes a very large equity grant, which, alongside the company's significant losses and related-party transactions, presents a complex risk-reward profile for investors. Investors should closely monitor the company's ability to integrate its numerous acquisitions, manage its escalating losses, and address internal control deficiencies, as well as the ongoing dilution from its financing activities.