BOLLINGER INNOVATIONS, INC.

Previous wording

The following discussion and analysis are intended to help the reader understand Mullen’s results of operations and financial condition. You should read the following discussion and analysis of our financial condition and results of operations together with our audited financial statements and related notes included elsewhere in this Report.

Current wording

The following discussion and analysis are intended to help the reader understand the Company’s results of operations and financial condition. You should read the following discussion and analysis of our financial condition and results of operations together with our audited financial statements and related notes included elsewhere in this Report.

Previous wording

This Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control), and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include but are not limited to, significant losses we have incurred since inception, and we expect that we will continue to incur losses for the foreseeable future; our ability to raise the substantial additional financing needed to execute our business plan, and a on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our production operations; our ability to continue as a going concern; our ability to maintain compliance with the continued listing requirements of the Nasdaq Capital Market; reliance on OEMs, suppliers and service providers for parts and components; our vehicles may fail to perform as expected; risks and uncertainties related to litigation, regulatory actions and government investigations and inquiries; changes in laws and regulations (domestically or internationally) that may materially adversely affect our business, prospects, financial condition and operating results; and other risks and uncertainties described under the section titled “Risk Factors” herein and in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024 (the “2024 Annual Report”), which was filed with the Securities and Exchange Commission on January 24, 2025. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation (and expressly disclaim any obligation) to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws. These risks and other factors described in this Report and 2024 Annual Report under the section …

Excerpt shortened here; the source contains the full paragraph.

Current wording

This Report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue” or “should,” or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to: significant losses we have incurred since inception, and we expect to continue to incur for the foreseeable future; our ability to raise the substantial additional financing needed to execute our business plan on acceptable terms, or at all, which failure to do so could force us to delay, limit, reduce or terminate our production operations; our ability to continue as a going concern; our ability to maintain compliance with the continued listing requirements of the Nasdaq Capital Market; reliance on OEMs, suppliers and service providers for parts and components; the potential for our vehicles to fail to perform as expected; risks and uncertainties related to litigation, regulatory actions and government investigations and inquiries; changes in laws and regulations (domestically or internationally) that may materially adversely affect our business, prospects financial condition and operating results; and other risks and uncertainties described under the section titled “Risk Factors” herein and in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024 (the “2024 Annual Report”), which was filed with the Securities and Exchange Commission on January 24, 2025. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation (and expressly disclaim any obligation) to update or revise any forward-looking statements, whether as a result of new information, future events or other reasons, except as may be required under applicable securities laws. These risks and other factors described in this Report and 2024 Annual Report u…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

These interim condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Ottava Automotive, Inc., a California corporation, Mullen Indiana Real Estate, LLC., a Delaware corporation, Mullen Investment Properties LLC, a Mississippi corporation, Mullen Advanced Energy Operations LLC, a California corporation and a majority ownership in Bollinger Motors, incorporated in Delaware. Intercompany accounts and transactions have been eliminated, if any. The financial statements reflect the consolidated financial position and results of operations of Mullen, which have been prepared in accordance with Generally Accepted Accounting Principles in the United States.

Current wording

These interim condensed consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries Ottava Automotive, Inc., a California corporation, Mullen Indiana Real Estate, LLC, a Delaware limited liability company, Mullen Investment Properties, LLC, a Mississippi limited liability company, Mullen Advanced Energy Operations, LLC, a California limited liability company and its majority-owned subsidiary Bollinger Motors, Inc., a Delaware corporation. Intercompany accounts and transactions have been eliminated, if any. The financial statements reflect the consolidated financial position and results of operations of the Company, which have been prepared in accordance with U.S. GAAP.

Previous wording

We recognize revenue from the sale of electric vehicles upon the transfer of control to the dealer/customer. Normally, control transfers at the point of delivery when the dealer/customer has possession of the vehicle and bears the risks and rewards of ownership. However, a contract with one of our dealers includes return provision, allowing unsold vehicles to be returned after one year; and contracts with a few other dealers include provisions allowing unsold vehicles to be returned upon contract termination. For these arrangements, due to limited historical data on returns, we defer revenue recognition until the dealer sells the vehicles to end customers, or there is sufficient evidence to reasonably estimate the consideration to which we expect to be entitled. In January 2025, one of the customers waived their right of return for 60 vehicles (Mullen Commercial segment), and the Company recognized revenue in amount of $3.7 million.

Current wording

We recognize revenue from the sale of electric vehicles upon the transfer of control to the dealer/customer. Normally, control transfers at the point of delivery when the dealer/customer has possession of the vehicle and bears the risks and rewards of ownership. However, a contract with one of our dealers includes a return provision, allowing unsold vehicles to be returned after one year, and contracts with a few other dealers include provisions allowing unsold vehicles to be returned upon contract termination. For these arrangements, due to limited historical data on returns, we defer revenue recognition until the dealer sells the vehicles to end customers or until there is sufficient evidence to reasonably estimate the consideration to which we expect to be entitled.

Previous wording

Research and development expenses decreased by $13.7 million, or 57%, from $24.0 million through the three months ended March 31, 2024, to $10.4 million through the three months ended March 31, 2025. Research and development expenses are primarily comprised of external fees and internal costs for engineering, homologation, prototyping, and other expenses related to preparation for the production of electric vehicles and batteries. The Company recently began cost reduction initiatives, thereby reducing research and development expenses in order to continue as a going concern.

Current wording

Research and development expenses decreased by $2.7 million, or 19%, from $14.3 million through the three months ended June 30, 2024, to $11.6 million through the three months ended June 30, 2025. Research and development expenses are primarily comprised of external fees and internal costs for engineering, homologation, prototyping and other expenses related to preparation for the production of electric vehicles and batteries. The Company recently began cost reduction initiatives, thereby reducing research and development expenses in order to continue as a going concern.

Previous wording

General and administrative expenses include all non-production expenses incurred in a given period. This includes professional fees, salaries, rent, repairs and maintenance, utilities and office expenses, employee benefits, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, licenses, and other expenses. We expense advertising costs as incurred. General and administrative expenses decreased by approximately $6.5 million, or 14%, from approximately $47.9 million in the three months ended March 31, 2024, to approximately $41.4 million in the three months ended March 31, 2025, primarily due to decrease of settlements and penalties, professional fees, promotion costs, etc.

Current wording

General and administrative expenses include all non-production expenses incurred in a given period. This includes professional fees, salaries, rent, repairs and maintenance, utilities and office expenses, employee benefits, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, licenses and other expenses. We expense advertising costs as incurred. General and administrative expenses decreased by approximately $11.3 million, or 24%, from approximately $47.5 million in the three months ended June 30, 2024, to approximately $36.2 million in the three months ended June 30, 2025, primarily due to decrease of settlements and penalties, advertising and promotions and compensation to employees.

Previous wording

The Company recognized other financing costs on initial recognition of warrants during the six months ended March 31, 2025 in the amount of $37.2 million due to additional notes with detached warrants issued during the six months ended March 31, 2025 (no investments during the six months ended March 31, 2024).

Current wording

The Company recognized other financing costs on initial recognition of warrants during the three months ended June 30, 2025 in the amount of $33.2 million due to higher value of notes with detached warrants issued during the three months ended June 30, 2025 (versus $17.9 million during the three months ended June 30, 2024). Net loss on revaluation of warrants obligations was $4.8 million during the three months ended June 30, 2025, in comparison to $2.3 million gain during the three months ended June 30, 2024.

Previous wording

Similarly, the interest expense increased by $7.3 million in comparison to the three months ended March 31, 2024 due to a higher volume of debt outstanding during the three months ended March 31, 2025, seeNotes 7to the financial statements.

Current wording

The interest expense (mainly amortization of original issue discount (seeNotes 7 - Debtto the financial statements) increased by $17.4 million in comparison to the three months ended June 30, 2024, due to a higher volume of debt outstanding during the three months ended June 30, 2025.

Previous wording

The net loss attributable to common stockholders (after preferred dividends) was approximately $47.1 million, or $489.24 net loss per share, for the three months ended March 31, 2025, as compared to a net loss attributable to common stockholders after preferred dividends of approximately $132.5 million, or $12,041,273.00 loss per share, for the three months ended March 31, 2024 (giving effect to reverse stock splits, seeNote 1 - Description of Business and Basis of Presentationto the financial statements).

Current wording

The net loss attributable to common stockholders (after preferred dividends) was $129.8 million, or $11,231.39 net loss per share, for the three months ended June 30, 2025, as compared to a net loss attributable to common stockholders after preferred dividends of approximately $96.0 million, or $95,987,912 loss per share, for the three months ended June 30, 2024 (giving effect to reverse stock splits, seeNote 1 - Description of business and basis of presentationto the financial statements).

Previous wording

We recognize revenue from the sale of electric vehicles upon the transfer of control to the dealer/customer. Normally, control transfers at the point of delivery when the dealer/customer has possession of the vehicle and bears the risks and rewards of ownership. However, a contract with one of our dealers includes return provision, allowing unsold vehicles to be returned after one year; and contracts with a few other dealers include provisions allowing unsold vehicles to be returned upon contract termination. For these arrangements, due to limited historical data on returns, we defer revenue recognition until the dealer sells the vehicles to end customers, or there is sufficient evidence to reasonably estimate the consideration to which we expect to be entitled. In January 2025, one of the customers waived their right of return for 60 vehicles (Mullen Commercial segment), and the Company recognized revenue in amount of $3.7 million.

Current wording

We recognize revenue from the sale of electric vehicles upon the transfer of control to the dealer/customer. Normally, control transfers at the point of delivery when the dealer/customer has possession of the vehicle and bears the risks and rewards of ownership. However, a contract with one of our dealers includes a return provision, allowing unsold vehicles to be returned after one year, and contracts with a few other dealers include provisions allowing unsold vehicles to be returned upon contract termination. For these arrangements, due to limited historical data on returns, we defer revenue recognition until the dealer sells the vehicles to end customers or until there is sufficient evidence to reasonably estimate the consideration to which we expect to be entitled. In January 2025, one of the customers waived their right of return for 60 vehicles (Bollinger Commercial segment), and the Company recognized revenue in amount of $3.7 million.

Previous wording

Research and development expenses decreased by $18.5 million, or 46%, from $40.2 million through the six months ended March 31, 2024, to $21.6 million through the six months ended March 31, 2025. Research and development expenses are primarily comprised of external fees and internal costs for engineering, homologation, prototyping, and other expenses related to preparation for the production of electric vehicles and batteries. The Company recently began cost reduction initiatives, thereby reducing research and development expenses in order to continue as a going concern.

Current wording

Research and development expenses decreased by $21.3 million, or 39%, from $54.5 million through the nine months ended June 30, 2024, to $33.2 million through the nine months ended June 30, 2025. Research and development expenses are primarily comprised of external fees and internal costs for engineering, homologation, prototyping and other expenses related to preparation for the production of electric vehicles and batteries. The Company recently began cost reduction initiatives, thereby reducing research and development expenses in order to continue as a going concern.

Previous wording

General and administrative expenses include all non-production expenses incurred in a given period. This includes professional fees, salaries, rent, repairs and maintenance, utilities and office expenses, employee benefits, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, licenses, and other expenses. We expense advertising costs as incurred. General and administrative expenses decreased by approximately $13.3 million, or 15%, from approximately $91.1 million in the six months ended March 31, 2024, to approximately $77.9 million in the six months ended March 31, 2025, primarily due to reduction in employee related compensation due to reduction in force, decrease of settlements and penalties, professional fees, promotion costs, etc.

Current wording

General and administrative expenses include all non-production expenses incurred in a given period. This includes professional fees, salaries, rent, repairs and maintenance, utilities and office expenses, employee benefits, depreciation and amortization, advertising and marketing, settlements and penalties, taxes, licenses and other expenses. We expense advertising costs as incurred. General and administrative expenses decreased by approximately $24.6 million, or 18%, from approximately $138.6 million in the nine months ended June 30, 2024, to approximately $114.0 million in the nine months ended June 30, 2025, primarily due to reduction in employee related compensation due to reduction in force, decrease of settlements and penalties, promotion costs, etc.

Previous wording

Due to unfavorable market conditions and the decline of market prices of the Company’s common stock, we tested Patents acquired in September 2022 as part of the Bollinger segment (seeNote 21 - Segment information) for recoverability on March 31, 2025 and recognized impairment loss in amount of $12.0 million mainly due to the uncertainty of future fundings required to support the business and decrease of Company's market capitalization. During the three months ended March 31, 2024, impairment of the intangible assets was $73.4 million, plus impairment of goodwill amounted to $28.8 million).

Current wording

Due to unfavorable market conditions and decline of market prices of the Company’s common stock, we test noncurrent assets for recoverability. For the nine months ended June 30, 2025, impairment of intangible assets amounted to $12.3 million (Bollinger Motors segment). During the nine months ended June 30, 2024, impairment of the intangible assets was $73.5 million (mainly Bollinger Motors segment, and $15.1 million recognized by Bollinger Commercial segment). In addition, impairment of goodwill amounted to $28.9 million (carrying value of goodwill was zero as of both June 30, 2025, and September 30, 2024). The impairment was recognized in the financial statements mainly due to the uncertainty of future fundings required to support the business and decrease of Company's market capitalization.

Previous wording

The Company recognized other financing costs on initial recognition of warrants during the three months ended March 31, 2025 in the amount of $21.1 million due to additional notes with detached warrants issued during the three months ended March 31, 2025 (no investments during the three months ended March 31, 2024).

Current wording

The Company recognized other financing costs on initial recognition of warrants during the nine months ended June 30, 2025, in the amount of $70.4 million (versus $17.9 million during the nine months ended June 30, 2024) due to additional notes with warrants issued during the nine months ended June 30, 2025.

Previous wording

Net gain on revaluation of warrants obligations was $63.6 million during the six months ended March 31, 2025 vs $3.1 million loss during the six months ended March 31, 2024 with the gains recorded primarily during periods when closing bid price of the Company's common stock was lower than conversion floor of the relevant warrants (after reverse stock splits). During the six months ended March 31, 2025, pursuant to the Warrant Exchange Agreement, the Company and certain investors agreed to issue new warrants in exchange for existing warrants, the Company and investors exchanged the warrants to fix conversion floor at $0.01 (not subject to reverse stock splits), which increased the fair value of warrants (calculated as number of shares issuable upon cashless exercise) and corresponding loss in amount of approximately $57.8 million was presented in the line item “Loss on exchange of warrants” of the consolidated statement of operations. For further details on accounting for warrants, seeNote 8 - Warrants and Other Derivative Liabilities and Fair Value Measurementsto the financial statements.

Current wording

Net gain on revaluation of warrants obligations was $58.8 million during the nine months ended June 30, 2025, versus a $0.8 million loss during the nine months ended June 30, 2024. During the nine months ended June 30, 2025, pursuant to the Warrant Exchange Agreement, the Company and certain investors agreed to exchange warrants to fix the conversion floor at $0.01 (not subject to reverse stock splits), which increased the fair value of warrants (calculated as number of shares issuable upon cashless exercise) and corresponding loss in amount of approximately $57.8 million as presented in the line item “Loss on exchange of warrants” of the consolidated statement of operations. For further details on accounting for warrants, seeNote 8 - Warrants and other derivative liabilities and fair value measurementsto the financial statements.

Previous wording

Similarly, the interest expense increased by $25.7 million in comparison to the six months ended March 31, 2024 due to a significantly higher volume of debt outstanding during the six months ended March 31, 2025, seeNotes 7to the financial statements.

Current wording

Similarly, the interest expense (mainly amortization of original issue discount (seeNote 7 - Debtto the financial statements) increased by $43.1 million in comparison to the nine months ended June 30, 2024, due to a significantly higher volume of debt outstanding during the nine months ended June 30, 2025, (seeNote 7 - Debtto the financial statements).

Previous wording

The net loss attributable to common stockholders (after preferred dividends) was approximately $162.0 million, or $3,338.65 net loss per share, for the six months ended March 31, 2025, as compared to a net loss attributable to common stockholders after preferred dividends of approximately $193.9 million, or $21,493,370.73 loss per share, for the six months ended March 31, 2024 (giving effect to reverse stock splits, see below).

Current wording

The net loss attributable to common stockholders (after preferred dividends) was $291.8 million, or $74,887.88 net loss per share, for the nine months ended June 30, 2025, as compared to a net loss attributable to common stockholders after preferred dividends of approximately $289.9 million, or $289,858,116 loss per share, for the nine months ended June 30, 2024 (giving effect to reverse stock splits, see below).

Previous wording

On February 14, 2025, the Company filed a Certificate of Amendment to its Second Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to affect a one-for-sixty (1-for-60) reverse stock split of its common stock. The reverse stock split became effective on February 18, 2025. As further described in theNote 20 - Subsequent events, the Company also implemented a 1-for-100 reverse stock split on April 11, 2025, which was applied retroactively to these consolidated financial statements.

Current wording

On June 2, 2025, the Company effected 1-for-100 reverse stock split of its common stock, and on August 4, 2025, the Company effected a 1-for-250 reverse stock split, as further described inNote 20 - Subsequent events, which were applied retroactively to these consolidated financial statements.

Previous wording

In addition to the reverse stock split referred to above, the Company previously effected a 1-for-25 reverse stock split on May 4, 2023, a 1-for-9 reverse stock split on August 11, 2023, a 1-for-100 reverse stock split on December 21, 2023, and 1-for-100 reverse stock split on September 17, 2024. The Company retroactively adjusted its historical financial statements to reflect the reverse stock splits.

Current wording

In addition to the reverse stock splits referred to above, the Company previously effected a 1-for-25 reverse stock split on May 4, 2023, a 1-for-9 reverse stock split on August 11, 2023, a 1-for-100 reverse stock split on December 21, 2023, 1-for-100 reverse stock split on September 17, 2024, 1-for-60 reverse stock split on February 18, 2025, and 1-for-100 reverse stock split on April 11, 2025. The Company retroactively adjusted its historical financial statements to reflect the reverse stock splits.

Previous wording

The reverse stock splits did not change the authorized number of shares or the par value of the common stock nor modify any voting rights of the common stock. No fractional shares were issued in connection with the reverse stock splits and each fractional share resulting from the reverse stock splits were rounded up to the next whole share.

Current wording

The reverse stock splits did not change the authorized number of shares or the par value of the common stock nor did it modify any voting rights of the common stock. No fractional shares were issued in connection with the reverse stock splits and each fractional share resulting from the reverse stock splits was rounded up to the next whole share.

Previous wording

The Company's principal source of liquidity consists of existing cash and restricted cash of approximately $2.3 million as of March 31, 2025. During the six months ended March 31, 2025, the Company used approximately $48.6 million of cash for operating activities. The net working capital deficit on March 31, 2025 amounted to approximately $156.1 million, or $56.7 million, after excluding derivative and other warrant liabilities and liabilities to issue stock, that are supposed to be settled by issuing common stock without using cash. For the six months ended March 31, 2025, the Company incurred a net loss of $172.7 million, and as of March 31, 2025, our accumulated deficit was approximately $2.5 billion.

Current wording

The Company's principal source of liquidity consists of existing cash and restricted cash of approximately $0.9 million as of June 30, 2025. During the nine months ended June 30, 2025, the Company used approximately $69.4 million of cash for operating activities. The net working capital deficit on June 30, 2025 amounted to approximately $144.1 million, or $41.6 million after excluding derivative and other warrant liabilities and liabilities to issue stock, that are supposed to be settled by issuing common stock without using cash. For the nine months ended June 30, 2025, the Company incurred a net loss of $304.4 million, and as of June 30, 2025, our accumulated deficit was approximately $2.6 billion.

Previous wording

The Company believes that its available liquidity will not be sufficient to meet its current obligations for a period of at least twelve months from the date of the filing of these unaudited interim condensed consolidated financial statements. Accordingly, the Company has concluded there is substantial doubt about its ability to continue as a going concern. During the six months ended March 31, 2025, the Company made the decision to temporarily shut down key production facilities due to short-term liquidity constraints. This action directly impacts our ability to produce vehicles. Should this shutdown continue, our cash flows from operating activities are expected to be further negatively impacted, which would further worsen the Company’s cash position. Management is pursuing several strategies to address liquidity concerns, including equity or debt financing and cost reduction and operational restructuring. Despite these efforts, there is no assurance that these initiatives will be successful. Without additional funding, the Company may be unable to continue operations and could be required to seek bankruptcy protection within 30 days of the issuance of these financial statements.

Current wording

The Company believes that its available liquidity will not be sufficient to meet its current obligations for a period of at least twelve months from the date of the filing of these unaudited interim condensed consolidated financial statements. Accordingly, the Company has concluded there is substantial doubt about its ability to continue as a going concern. During the nine months ended June 30, 2025, the Company made the decision to temporarily shut down key production facilities due to short-term liquidity constraints. This action directly impacts our ability to produce vehicles. Should this shutdown continue, our cash flows from operating activities are expected to be further negatively impacted, which would further worsen the Company’s cash position. Management is pursuing several strategies to address liquidity concerns, including equity or debt financing and cost reduction and operational restructuring. Despite these efforts, there is no assurance that these initiatives will be successful. Without additional funding, the Company may be unable to continue operations and could be required to seek bankruptcy protection within 30 days of the issuance of these financial statements.

Previous wording

To date, our current working capital and development needs have been primarily funded through the issuance of convertible indebtedness, warrants, convertible preferred stock and common stock. During the six months ended March 31, 2025, we received approximately $33 million and issued Senior secured convertible notes, bearing 15% interest and maturing in 4 months, and warrants with terms further described inNote 7 - Debt andNote 8 - Warrants and other derivative liabilities and fair value measurementsto the condensed consolidated financial statements. Furthermore, in October 2024, the Company received $1 million proceeds in accordance with the equity line of credit (see further inNote 9 - Stockholder's Equity).

Current wording

To date, our current working capital and development needs have been primarily funded through the issuance of convertible indebtedness, warrants, convertible preferred stock and common stock. During the nine months ended June 30, 2025, we issued Senior secured convertible notes with an aggregate principal of approximately $68 million, bearing 15% interest (20% after default), and warrants with terms further described inNote 7 - Debt andNote 8 - Warrants and other derivative liabilities and fair value measurementsto the condensed consolidated financial statements. Furthermore, in October 2024, the Company received $1 million proceeds in accordance with the equity line of credit (see further inNote 9 - Stockholder's equity).

Previous wording

Also, in October 2024, Bollinger Motors, Inc., a majority-owned subsidiary of Mullen Automotive Inc., received a $10 million long-term loan, providing additional capital to support the production and sale of Bollinger’s Class 4 EV truck, the B4. The note bears interest at 15% per annum, with monthly interest-only payments, and principal repayment due by October 30, 2026. It is secured by part of the assets of Bollinger Motors, excluding inventory and certain intellectual property. See alsoNote 19 - Contingencies and claims for disclosure on a lawsuit from the lender.

Current wording

Also, in October 2024, Bollinger Motors, Inc., a majority-owned subsidiary of the Company, received a $10 million long-term loan, providing additional capital to support the production and sale of Bollinger’s Class 4 EV truck, the Bollinger B4. After a lawsuit from the lender upon alleged default on one of the interest payments, the note was fully repaid by the Company in May 2025 (seeNote 7 - Debt for details).

Previous wording

During the six months ended March 31, 2025, a significant part of Senior secured convertible notes, as well as relevant accumulated interest (notes with a carrying amount of approximately $24.8 million and interest with a carrying amount of approximately $1.5 million), have been converted into shares of common stock. Also, the Company reached an agreement with holders of matured notes and loan advances in amount of $2.7 million, as well as accumulated interest in amount of approximately $1.8 million, that the liabilities would be settled pursuant to Section 3(a)(9) of the Securities Act by issuance of shares of common stock of the Company worth of $3 million. The liability was fully settled by December 2024, and the transaction resulted in recognition of gain on extinguishment of $1.5 million.

Current wording

During the nine months ended June 30, 2025, Senior secured convertible notes with a principal of approximately $26 million, as well as relevant accumulated interest with a carrying amount of approximately $1.5 million, were converted into shares of common stock. Also, the Company reached an agreement with holders of matured notes and loan advances in amount of $2.7 million, as well as accumulated interest in amount of approximately $1.8 million, that the liabilities would be settled pursuant to Section 3(a)(9) of the Securities Act by issuance of shares of common stock of the Company worth $3 million. The liability was fully settled by December 2024, and the transaction resulted in recognition of gain on extinguishment of $1.5 million.

Previous wording

The following is a summary of our indebtedness as of March 31, 2025 and of transactions during the six months ended March 31, 2025:

Current wording

The following is a summary of our indebtedness as of June 30, 2025 and of transactions during the nine months ended June 30, 2025:

Previous wording

The following table provides a summary of our cash flow data for the six months ended March 31, 2025 and 2024:

Current wording

The following table provides a summary of our cash flow data for the nine months ended June 30, 2025 and 2024:

Previous wording

Our cash flow used in operating activities to date has been primarily comprised of costs related to research and development, payroll and other general and administrative activities. Net cash used in operating activities was $48.6 million in the six months ended March 31, 2025, a 55% decrease from $108.5 million net cash used during the six months ended March 31, 2024.

Current wording

Our cash flow used in operating activities to date has been primarily comprised of costs related to research and development, payroll and other general and administrative activities. Net cash used in operating activities was $69.4 million in the nine months ended June 30, 2025, a 52% decrease from $145.2 million net cash used during the nine months ended June 30, 2024.

Previous wording

During the six months ended March 31, 2025 and 2024, our cash flows used in investing activities have been comprised mainly of equipment purchases. Net cash used in investing activities was $3.9 million in the six months ended March 31, 2025, a 69% decrease from $12.5 million used in investing activities during the six months ended March 31, 2024.

Current wording

During the nine months ended June 30, 2025 and 2024, our cash flows used in investing activities have been comprised mainly of equipment purchases. Net cash used in investing activities was $4.2 million in the nine months ended June 30, 2025, a 70% decrease from $14.1 million used in investing activities during the nine months ended June 30, 2024.

Previous wording

Through March 31, 2025, we have financed our operations primarily through the issuance of convertible notes and warrants, as well as by receiving a long-term loan for production of Bollinger vehicles (for further details, see section Debt above). Net cash provided by financing activities was $44.0 million for the six months ended March 31, 2025, as compared to $4.9 million net cash spent on financing activities for the six months ended March 31, 2024.

Current wording

Through June 30, 2025, we have financed our operations primarily through the issuance of convertible notes and warrants, as well as by receiving a long-term loan for production of Bollinger Motors vehicles (for further details, see section "Debt" above). Net cash provided by financing activities was $63.8 million for the nine months ended June 30, 2025, as compared to $7.5 million net cash spent on financing activities for the nine months ended June 30, 2024.

Previous wording

The following are scheduled debt maturities as of March 31, 2025 (see also note Debt above):

Current wording

The following are scheduled debt maturities as of June 30, 2025 (see also section "Debt" above):

Previous wording

In preparation of these financial statements, the management applied critical estimates and assumptions while performing impairment tests for long-lived assets and while determining net realizable value of inventory.

Current wording

In preparation of these financial statements, management applied critical estimates and assumptions while performing impairment tests for long-lived assets and while determining net realizable value of inventory.

Previous wording

We identified Bollinger and Mullen Commercial (refer to* Note 4 - Segment information*) as our reporting units for the purposes of assessing impairments.

Current wording

We identified Bollinger Motors and Bollinger Commercial (refer to* Note 4 - Segment information*) as our reporting units for the purposes of assessing impairments.

Previous wording

We review our noncurrent asset groups for impairment whenever events or changes in circumstances indicate that the carrying amount of such asset groups may not be recoverable. Such conditions could include significant adverse changes in the business climate, current period operating or cash flow losses, significant declines in forecasted operations, or a current expectation that an asset group will be disposed of before the end of its useful life. The recoverability of noncurrent asset groups to be held and used is measured by a comparison of the carrying amount of the asset group to future undiscounted net cash flows expected to be generated by the asset group. If an asset group is considered to be impaired, the impairment is recognized in amount by which the carrying amount of the asset group exceeds the fair value of the asset group.

Current wording

We review our noncurrent asset groups for impairment whenever events or changes in circumstances indicate that the carrying amount of such asset groups may not be recoverable. Such conditions could include significant adverse changes in the business climate, current period operating or cash flow losses, significant declines in forecasted operations or a current expectation that an asset group will be disposed of before the end of its useful life. The recoverability of noncurrent asset groups to be held and used is measured by a comparison of the carrying amount of the asset group to future undiscounted net cash flows expected to be generated by the asset group. If an asset group is considered to be impaired, the impairment is recognized in the amount by which the carrying amount of the asset group exceeds the fair value of the asset group.

Previous wording

Due to a prolonged decrease in our market capitalization, including a significant decline in stock price and budgeted performance targets not achieved as compared to acquisition date budgets, we assessed noncurrent assets for impairment. As a result of impairment tests performed by management as of March 31, 2025, the Company recognized impairment loss in amount of $12.0 million in respect of Patents (Bollinger segment). No impairment in respect of other noncurrent assets was recognized, primarily because of significant impairment that reduced carrying amount of long-lived assets in previous periods.

Current wording

Due to a prolonged decrease in our market capitalization, including a significant decline in stock price and budgeted performance targets not achieved as compared to acquisition date budgets, we assessed noncurrent assets for impairment. As a result of impairment tests performed by management during the nine months ended June 30, 2025, the Company recognized impairment loss in the amount of $12.3 million in respect of patents (Bollinger Motors segment). No impairment in respect of other noncurrent assets was recognized, primarily because of significant impairment that reduced the carrying amount of long-lived assets in previous periods.

Previous wording

As a result of the tests performed by the management during the six months ended March 31, 2025, the write-down to net realizable value in amount of $0.8 million was recorded by the Mullen Commercial segment. These adjustments were recorded as a component of cost of goods sold.

Current wording

As a result of the tests performed by management during the three and nine months ended June 30, 2025, the write-down to net realizable value in amount of $8.9 million and $9.7 million, respectively (whereas $6 million was recorded by the Bollinger Commercial segment, and remaining part - by the Bollinger segment). These adjustments were recorded as a component of cost of goods sold.

Previous wording

The net realizable value assessment considered the current expected selling prices of Mullen One, Mullen Three, and Bollinger B4 vehicles, based on recent sales and current market demand. Should actual sales prices or demand decline, additional write-downs may be required in future periods. Additionally, if the Company is unable to secure sufficient funding to continue operations as planned, inventory may need to be sold at further discounted prices, which could negatively impact future financial results.

Current wording

The net realizable value assessment considered the current expected selling prices of Mullen One, Mullen Three, and Bollinger B4 vehicles, based on recent sales and current market demand, as well as expected additional costs required to sell the vehicles. Should actual sales prices or demand decline, or selling costs increase, additional write-downs may be required in future periods. Additionally, if the Company is unable to secure sufficient funding to continue operations as planned, inventory may need to be sold at further discounted prices, which could negatively impact future financial results.