Archer Aviation Inc.

Cybersecurity and data protection · Third party data security and vendors

We collect, store, transmit and otherwise process data from our aircraft, customers, employees and others, including personal information or confidential or proprietary information. We also work with partners and third-party service providers or vendors that collect, store and process such data on our behalf. Although we have implemented security controls, there can be no assurance that our security controls or those of our partners and vendors will prevent all security breaches.

Cybersecurity and data protection · Data breaches and cyber attacks

Our business and reputation are impacted by information technology system failures and network disruptions. We and our global supply chain rely on complex information technology systems and are exposed to information technology system failures or network disruptions caused by natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins, ransomware or other cybersecurity incidents.

Reputation and brand · Brand damage and negative publicity

If we experience harm to our reputation and brand, our business, financial condition and results of operations could be adversely affected. Our reputation and brand are critical to our ability to attract customers, partners, talent, and investors. Negative perception of our technology, industry or our company may harm our reputation and brand.

Reputation and brand · Product recalls and public safety

Operation of aircraft involves inherent risks, and any accident involving aircraft, including eVTOL aircraft, could result in losses, adverse publicity, and reputational harm. Safety and reliability are critical for attracting and retaining customers. Failure to maintain satisfactory standards of safety and reliability could adversely impact our ability to attract and retain customers.

Corporate governance · Shareholder rights and activism

Anti-takeover provisions in our governing documents could delay or prevent a change of control. Certain provisions of our amended and restated certificate of incorporation and bylaws have anti-takeover effects and may delay, defer or prevent a merger, acquisition, tender offer, takeover attempt or other change of control, even if such transaction may benefit stockholders.

Innovation and product development · Product development and randd investment risks

We are developing our eVTOL aircraft and related UAM operations, which remain in the early stages, and our business and future prospects are subject to significant risks. We were incorporated in October 2018 and have a limited operating history in designing, developing, and certifying eVTOL aircraft.

Market position and competition · Pricing pressure and margin compression

Our customer purchase agreements may include price escalation clauses, which could lead to losses if our costs rise faster than the agreed escalation rates. Commercial aircraft contracts are often signed years before delivery. To account for economic changes during that period, prices usually include fixed amounts adjusted by escalation formulas based on labor, commodity, and other indices.

International and currency · International operations and emerging markets

Our current international operations and our expansion plans could subject us to political, operational and regulatory challenges. We sell our aircraft and are developing UAM operations outside the United States, and we are continuing to expand our international operations as part of our growth strategy. International operations are subject to risks such as differing or more stringent regulations, political or economic instability, cross-border tensions, import/export compliance, tariffs, trade barriers.

Capital structure and performance · Dividend policy and capital allocation

We do not expect to pay cash dividends on our Class A common stock in the foreseeable future. We intend to retain any earnings to fund the growth and development of our business, and as a result, investors may not receive a return on their investment unless they sell their shares, and the value of our common stock may not appreciate.

Capital structure and performance · Debt management and refinancing

Failure to comply with the debt covenants in our loan agreements could result in our inability to borrow additional funds and adversely impact our business. Our outstanding credit agreements contain restrictive financial and operational covenants including covenants relating to our liquidity. A covenant breach could accelerate repayment obligations, restrict additional borrowing, and adversely affect liquidity and operations.

Capital structure and performance · Financial performance volatility

As of December 31, 2025, we incurred a net loss of $618.2 million, and we have incurred a net loss of approximately $2.3 billion since inception. We expect to continue incurring operating and net losses each quarter until at least the time we begin generating significant revenues from our planned lines of business.

Core operations · Facility damage and equipment failure

We may fail to realize the anticipated benefits from our planned operations at Hawthorne Airport. The estimated costs of, and the projected schedule for, our planned capital projects are subject to a number of uncertainties. Our ability to complete these projects within budgets and on expected schedules may be adversely affected by various factors including errors in our estimated costs and projected schedule, design and engineering errors, cost increases because of demand for labor and materials.

Core operations · Operational disruption and business continuity

We may fail to realize the anticipated benefits from our planned operations at Hawthorne Airport. Failure to achieve the anticipated benefits from our planned operations at Hawthorne Airport could adversely affect our business, results of operations, or financial condition, decrease or delay any accretive effect of our acquisition of the Hawthorne Airport.

Project and contract management · Large contract concentration

We are party to certain purchase agreements to deploy Midnight aircraft and related technologies and services, including the United Purchase Agreement and contracts with USAF, that contain conditions with respect to the purchase of our aircraft or that require us to perform and deliver certain tests, certificates and other services. Payment obligations under the agreement with United Airlines Inc. for the conditional purchase of up to $1.0 billion worth of aircraft, with an option for another $500.0 million worth of aircraft.

Human capital and workforce · Labor relations and union negotiations

Our business may be adversely affected by labor and union activities. While none of our employees are currently unionized, many aerospace companies have unionized workforces, which can result in higher employee costs and increased risk of work stoppages. We also rely on other companies, such as suppliers and freight providers, that may have unionized employees, and strikes or labor disruptions at these companies could negatively affect our business.

Core operations · Safety incidents and operational accidents

A major health or safety incident could adversely affect our reputation, business and results of operations. Manufacturing lines, airports, and aviation infrastructure are inherently dangerous, and operating in this industry involves certain inherent health and safety risks. Any failure in health and safety performance, whether at our own facilities or those of our contract manufacturers and suppliers, may result in penalties for non-compliance.

Industry regulation · Regulatory compliance and changes

Our eVTOL aircraft is in the development stage, and we depend on continued engagement with the FAA, DOT, and other regulators in the U.S. and certain other countries to obtain required certifications and authorizations for aircraft design, production, and operations. Delays, interruptions, or unwillingness by regulatory agencies to engage with us could postpone or prevent certification.

Legal and litigation · Litigation and legal proceedings

We may face legal proceedings, which can be costly and time-consuming. Pending legal proceedings and other future legal proceedings against us or our employees, regardless of outcome or merit, could be time consuming and expensive to defend or resolve, result in substantial diversion of management and technical resources, delay or prevent commercialization of our aircraft, harm our reputation.

Data and privacy · Data protection and privacy laws

Failure to comply with laws and regulations relating to privacy, data protection and consumer protection, or the expansion of current laws and regulations or the enactment of new laws or regulations in these areas, could adversely affect our business and our financial condition. We are subject to numerous U.S. and foreign laws, regulations, contractual obligations and industry standards relating to privacy, data protection, and consumer protection, including the California Consumer Privacy Act and the European Union and U.K. General Data Protection Regulations.

Geopolitical and trade · Trade policies tariffs and sanctions

Our business is also subject to stringent U.S. import and export control laws and sanctions, which may include the Export Administration Regulations, the International Traffic in Arms Regulations, and economic sanctions administered by the Treasury Department's Office of Foreign Assets Control. Recent and potential changes in U.S. and foreign trade policies, including tariffs, trade restrictions, and renegotiation or termination of trade agreements, have increased uncertainty.