General Enterprise Ventures, Inc.

Previous wording

Effective June 25, 2024, the Company formed and organized a wholly owned subsidiary, GEVI Insurance Holdings Inc., an Ohio corporation (“GEVI Insurance”), to enter the wildfire insurance markets utilizing the Company’s flame retardant and flame suppression product. Effective February 21, 2025, the Company formed MFB Insurance Company, Inc., a Hawaii corporation and organized it as a wholly owned subsidiary of GEVI Insurance to act as a captive insurance company to enter the wildfire insurance market.

Current wording

Effective June 25, 2024, the Company formed and organized a wholly owned subsidiary, GEVI Insurance Holdings Inc., an Ohio corporation (“GEVI Insurance”), to enter the wildfire insurance markets utilizing the Company’s flame retardant and flame suppression product. Effective February 21, 2025, the Company formed MFB Insurance Company, Inc., a Hawaii corporation (“MFBI”) and organized it as a wholly owned subsidiary of GEVI Insurance to act as a captive insurance company to enter the wildfire insurance market. MFBI was formed to act as a captive insurance company to reinsure real property protected with the Company’s CitroTech product. MFBI is not currently able to reinsure real property.

Previous wording

The following summary of our results of operations should be read in conjunction with our unaudited interim financial statements for the three months ended March 31, 2025 and 2024, which are included herein.

Current wording

The following summary of our results of operations should be read in conjunction with our unaudited interim financial statements for the three and six months ended June 30, 2025 and 2024, which are included herein.

Previous wording

The following summary of our results of operations should be read in conjunction with our audited financial statements for the three months ended March 31, 2025 and 2024, which are included herein.

Current wording

The following summary of our results of operations should be read in conjunction with our audited financial statements for the three and six months ended June 30, 2025 and 2024, which are included herein.

Previous wording

The Company’s revenue is associated with revenue from MFB Ohio which acquired intellectual property to fire suppression in April 2022. During the three months ended March 31, 2025, the revenue increased $536,000 from the three months ended March 31, 2024, largely due to the adoption of our technology by the marketplace, including the sale of homebased wildfire defense systems, commercial and fire department chemical sales, and directly spraying residential properties due to the wildfire concerns.

Current wording

The Company’s revenue is associated with revenue from MFB Ohio which acquired intellectual property to fire suppression in April 2022. During the three months ended June 30, 2025, the revenue increased $489,000 from the three months ended June 30, 2024, largely due to the adoption of our technology by the marketplace, including the sale of homebased wildfire defense systems, commercial and fire department chemical sales, and directly spraying residential properties due to the wildfire concerns.

Previous wording

Rent expenses are warehouse rent expenses. The increase in rent expense is because the Company leased commercial space for office, retail and warehousing from March 2024 under a one-year contract.

Current wording

Rent expenses are warehouse rent expenses. The increase in rent expense is primarily because the Company leased a larger commercial space for office, retail and warehousing from April 2025 and the cancelation of one of our warehouse leases in May 2025.

Previous wording

The increase in advertising and marketing during the three months ended March 31, 2025, over the three months ended March 31, 2024, is primarily due to an increase in expenses to support revenue growth.

Current wording

The decrease in advertising and marketing during the three months ended June 30, 2025, over the three months ended June 30, 2024, is primarily due to stock-based service compensation of $160,000 in 2024. Excluding stock based compensation, advertising marketing expense increased due to support revenue growth.

Previous wording

During the three months ended March 31, 2025, management compensation primality included stock-based management compensation of $410,000 to a management of subsidiary and cash payments of $142,000 to our former CEO, and payroll to our employees of $76,203.

Current wording

During the three months ended June 30, 2025, management compensation primality included stock-based management compensation of $1,867,000 to our management and cash payments of $325,000 to our management, and payroll to our employees of $142,000.

Previous wording

For the three months ended March 31, 2025 and 2024, the other expenses consisted of $473,000 and $1,000 interest related to convertible notes payable issued in 2024, respectively, change in fair value of derivative liability related to convertible notes payable issued in 2024 of $805,000 and $0, respectively, financing expense of $6.2 million and $0, respectively, and loss on settlement of notes payable and convertible note issued in 2022 of $0 and $882,000, respectively. Financing expense is 4 million warrants granted to a financial advisor in 2025.

Current wording

For the three months ended June 30, 2025 and 2024, the other expenses consisted of $765,000 and $0 interest related to convertible notes payable issued in 2025 and 2024, respectively, change in fair value of derivative liability related to convertible notes payable issued in 2025 and 2024 of $3.0 million and $0, respectively, financing expense of $2.5 million and $0, respectively, and loss on settlement of debt from conversion of debt of $2.6 million and $0, respectively. Financing expense is from 69,007 shares of Series C Convertible Preferred stock issued to a Series A Preferred Shareholder in 2025.

Previous wording

The net loss for the three months ended March 31, 2025, increased by approximately $7.4 million as compared to the three months ended March 31, 2024 primarily due to the increase in operating expenses and other expense offset by the increase in revenue.

Current wording

The net loss for the three months ended June 30, 2025, increased by approximately $11.0 million as compared to the three months ended June 30, 2024 primarily due to the increase in operating expenses and other expense offset by the increase in revenue.

Previous wording

During the three months ended March 31, 2025, the cost of revenue increased over the three months ended March 31, 2024, primarily due to an increase in cost of inventory and royalty and sales commissions.

Current wording

During the six months ended June 30, 2025, the cost of revenue increased over the six months ended June 30, 2024, primarily due to an increase in cost of inventory, rent and royalty and sales commissions.

Previous wording

Royalty and sales commissions increased in the three months ended March 31, 2025 from more revenue. The Company recognizes an allocated portion of consulting and direct labor costs associated with our revenue as royalty and sales cost of revenue. In March 2025, the Company entered int new contract and there is no longer royalty.

Current wording

Royalty and sales commissions increased in the six months ended June 30, 2025, from more revenue. The Company recognized an allocated portion of consulting and direct labor costs associated with our revenue as royalty and sales cost of revenue in 2024 and during the first quarter of 2025. In March 2025, the Company entered into a new contract and there is no longer consulting and advisory and royalty.

Previous wording

The professional fees during the three months ended March 31, 2025, primarily included stock-based compensation of $2.1 million to a related party consultant (TC Special Investments, LLC (“TCSI”)) and various professional fee for accounting and audit related to SEC filing, legal on patents and other consulting services in 2025. The professional fees during the three months ended March 31, 2024, primarily included stock-based management compensation of $1.4 million to advisors to our subsidiary MFB and stock-based compensation of $1.0 million to various consultants for IT service for software development, legal on patents and other consulting services in 2024.

Current wording

The professional fees during the six months ended June 30, 2025, primarily included stock-based compensation of $2.1 million to a related party consultant (TC Special Investments, LLC (“TCSI”)) and various professional fees for accounting and audit related to SEC filings, legal on patents and other consulting services in 2025. The professional fees during the six months ended June 30, 2024, primarily included stock-based management compensation of $1.4 million to advisors to our subsidiary MFB and stock-based compensation of $1.2 million to various consultants for IT service for software development, legal on patents and other consulting services in 2024.

Previous wording

During the three months ended March 31, 2024, management compensation primality included cash payment of $25,000 to our former CEO.

Current wording

During the six months ended June 30, 2024, management compensation primality included cash payment of $25,000 to our former CEO.

Previous wording

Since our inception, we have incurred significant operating losses and negative cash flows from our operations. Our net loss was $10.9 million and $3.5 million for the three months ended March 31, 2025 and 2024, respectively. During the three months ended March 31, 2025, we completed a debt offering and an equity offering which generated net proceeds of approximately $3.7 million and $0.3 million respectively.

Current wording

Since our inception, we have incurred significant operating losses and negative cash flows from our operations. Our net loss was $22.8 million and $4.4 million for the six months ended June 30, 2025 and 2024, respectively. During the six months ended June 30, 2025, we completed a debt offering and an equity offering which generated net proceeds of approximately $3.7 million and $0.3 million respectively.

Previous wording

As of March 31, 2025 and December 31, 2024, the current assets consisted of cash of $3.7 million and $775,000, respectively, inventory of $312,000 and $325,000, respectively accounts receivable of $746,000 and $317,000, respectively, prepaid expenses and other current assets of $61,000 and $74,000, respectively, and deferred offering costs of $149,000 and $126,000, respectively.

Current wording

As of June 30, 2025 and December 31, 2024, the current assets consisted of cash of $2.3 million and $775,000, respectively, inventory of $410,000 and $325,000, respectively accounts receivable of $654,000 and $317,000, respectively, prepaid expenses and other current assets of $206,000 and $74,000, respectively, and deferred offering costs of $185,000 and $126,000, respectively.

Previous wording

As of March 31, 2025 and December 31, 2024, the current liabilities consisted of accounts payable and accrued liabilities of $530,000 and $187,000, respectively, convertible notes net of discount of $542,000 and $196,000, respectively, convertible note – related parties of $783,000 and $577,000, respectively, accrued interest – related parties of $31,000 and $0, respectively financing loan of $0 and $97,000, respectively, derivative liability of $2.9 million and $1.1 million, respectively, and current portion of operating lease liability of $29,000 and $50,000, respectively.

Current wording

As of June 30, 2025 and December 31, 2024, the current liabilities consisted of accounts payable and accrued liabilities of $533,000 and $187,000, respectively, deferred revenue of $95,000 and $0, respectively, convertible notes net of discount of $278,000 and $196,000, respectively, convertible note – related parties of $932,000 and $577,000, respectively, due to related party of $96,000 and $0, respectively financing loan of $0 and $97,000, respectively, derivative liability of $3.7 million and $1.1 million, respectively, and current portion of operating lease liability of $139,000 and $50,000, respectively.

Previous wording

The increase in working capital in 2025 was primarily due to an increase in cash and accounts receivable offset by an increase in the convertible notes and derivative liability related to convertible notes. The Company had net loss and negative cash flows from our operations. In 2025, the Company generated funds from more debt financing than equity financing, however, the carrying value of convertible notes included of unamortized debt discount of $4.6 million. Considering this unamortized discount, the Company still had capital deficiency of $4.6 million as of March 31, 2025.

Current wording

The increase in working capital deficiency in 2025 was primarily due to an increase in the convertible notes and derivative liability related to convertible notes offset by an increase in cash and accounts receivable. The Company had net loss and negative cash flows from our operations. In 2025, the Company generated funds from more debt financing than equity financing.

Previous wording

For the three months ended March 31, 2025, net cash flows used in operating activities consisted of a net loss of $10.9 million, reduced by stock-based compensation of $2.8 million, financing expense of $6.2 million, non-cash lease expenses of $21,000, amortization and depreciation of $75,000, amortization of debt discount of $377,000, and changes in derivative liability of $805,000, which were increased by net changes in operating assets and liabilities of $24,000.

Current wording

For the six months ended June 30, 2025, net cash flows used in operating activities consisted of a net loss of $22.8 million, reduced by stock-based compensation of $4.7 million, financing expense of $8.7 million, non-cash lease expenses of $86,000, amortization and depreciation of $151,000, amortization of debt discount of $1 million, loss on settlement of debt of $2.6 million and changes in derivative liability of $3.8 million, and increased by net changes in operating assets and liabilities of $101,000.

Previous wording

For the three months ended March 31, 2024, net cash flows used in operating activities consisted of a net loss of $3.5 million, reduced by stock-based compensation of $1.7 million, non-cash lease expenses of $20,000, amortization and depreciation of $64,000, loss on settlement of debt of $882,000 and increased by net changes in operating assets and liabilities of $188,000.

Current wording

For the six months ended June 30, 2024, net cash flows used in operating activities consisted of a net loss of $4.4 million, reduced by stock-based compensation of $2.8 million, non-cash lease expenses of $39,000, amortization and depreciation of $127,000, loss on settlement of debt of $882,000 and increased by net changes in operating assets and liabilities of $148,000.

Previous wording

For the three months ended March 31, 2025, the cash flows used in investing activities were $27,000, which was related to the purchase of equipment.

Current wording

For the six months ended June 30, 2025, the cash flows used in investing activities were $168,000, which was related to the purchase of property and equipment.

Previous wording

The Company did not use any funds for investing activities during the three months ended March 31, 2024.

Current wording

The Company did not use any funds for investing activities during the six months ended June 30, 2024.

Previous wording

For the three months ended March 31, 2025, net cash provided by financing activities consisted of $260,000 proceeds from the issuance of Series C Convertible Preferred Stock, $3.7 million from the issuance of convertible promissory notes and associated warrants, $23,000 deferred offering cost payment, and repayment of a financing loan of $216,000.

Current wording

For the six months ended June 30, 2025, net cash provided by financing activities consisted of $260,000 proceeds from the issuance of Series C Convertible Preferred Stock, $3.7 million from the issuance of convertible promissory notes and associated warrants, $59,000 deferred offering cost payment, repayment of a financing loan of $216,000 and repayments to related party of $25,000.

Previous wording

For the three months ended March 31, 2024, net cash provided by financing activities consisted of $165,000 proceed from issuance Series C Preferred Stock.

Current wording

For the six months ended June 30, 2024, net cash provided by financing activities consisted of $165,000 proceed from issuance Series C Preferred Stock, $695,000 advances received from eleven (11) lenders in cash for issuance of convertible promissory notes and warrants, $35,000 deferred offering cost payment and $60,000 repayment of loan -related party.

Previous wording

In third and fourth quarter 2024 and first quarter 2025, the Company entered into thirty-one (31) subscription agreements for convertible notes ($3,371,000) and warrants (4,213,750 shares of common stock). The material terms of this convertible note indebtedness are, (i) a 12-month maturity; (ii) 10% interest per annum, capitalized on the maturity date; (iii) conversion rights in the amount of the principal, either (x) divided by 0.40 or (y) a 30% discount to the price sale of its Common Stock pursuant to a registration statement filed with the SEC and listing of the Common Stock on national securities exchange; and (iv) warrant coverage for five years at the rate of 1.25 shares of Common Stock for each dollar of principal, at an exercise price of $0.50 per share.

Current wording

In first quarter 2025, the Company entered into eleven (11) subscription agreements for convertible notes ($2,075,000) and warrants (2,593,750 shares of common stock). The material terms of this convertible note indebtedness are, (i) a 12-month maturity; (ii) 10% interest per annum, capitalized on the maturity date; (iii) conversion rights in the amount of the principal, either (x) divided by 0.40 or (y) a 30% discount to the price sale of its Common Stock pursuant to a registration statement filed with the SEC and listing of the Common Stock on national securities exchange; and (iv) warrant coverage for five years at the rate of 1.25 shares of Common Stock for each dollar of principal, at an exercise price of $0.50 per share.

Previous wording

In February 2025, the Company entered into one (1) subscription agreement for convertible notes ($2,000,000) and warrants (2,500,000 shares of common stock) with a related party. The convertible note has a term of twelve (12) months, at an interest rate of 10% per annum and warrants are with a term of five (5) years, at exercise price of $0.50 per share. The outstanding principal amount of convertible notes and unpaid interest is convertible at a fixed conversion price of $0.40. The obligations of the Company under the convertible note are secured by a pledge of the Company’s membership interests in MFB Ohio. In the event of a default, related party G could proceed against the equity of MFB Ohio pledged to collateralize the convertible note. MFB Ohio owns the Company’s intellectual property portfolio.

Current wording

In February 2025, the Company entered into one (1) subscription agreement for convertible notes ($2,000,000) and warrants (2,500,000 shares of common stock) with a related party. The convertible note has a term of twelve (12) months, at an interest rate of 10% per annum and warrants are with a term of five (5) years, at exercise price of $0.50 per share. The outstanding principal amount of convertible notes and unpaid interest is convertible at a fixed conversion price of $0.40. The obligations of the Company under the convertible note are secured by a pledge of the Company’s membership interests in MFB Ohio. In the event of a default, the noteholder could proceed against the equity of MFB Ohio pledged to collateralize the convertible note. MFB Ohio owns the Company’s intellectual property portfolio.

Previous wording

Our unaudited consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), which require management to make estimates, judgments and assumptions that affect the amounts reported in our unaudited consolidated financial statements and accompanying notes. We believe our most critical accounting estimates relate to the following:

Current wording

Our unaudited consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), which require management to make estimates, judgments and assumptions that affect the amounts reported in our unaudited consolidated financial statements and accompanying notes. We believe our most critical accounting estimates relate to the following: