Twin Vee PowerCats, Co.

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes included in this Quarterly Report on Form 10-Q. The following discussion contains forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.” Our actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those discussed below and elsewhere in this Quarterly Report on Form 10-Q. This discussion should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and notes thereto. You should also review the disclosure under the heading “Risk Factors” in this Quarterly Report on Form 10-Qand under Part 1, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of important factors that could cause our actual results to differ materially from those anticipated in these forward-looking statements.

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes included in this Quarterly Report on Form 10-Q. The following discussion contains forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.” Our actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those discussed below and elsewhere in this Quarterly Report on Form 10-Q. This discussion should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and notes thereto. You should also review the disclosure under the heading “Risk Factors” in this Quarterly Report on Form 10-Q and under Part 1, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of important factors that could cause our actual results to differ materially from those anticipated in these forward-looking statements.

Previous wording

Twin Vee PowerCats Co. (“Twin Vee” “we”, “us” or the “Company”) is a designer, manufacturer and marketer of recreational and commercial power boats. We believe our company, founded in 1996, has been an innovator in the recreational and commercial power catamaran industry. Our twin-hull catamaran running surface, known as a symmetrical catamaran hull design, adds to the Twin Vee ride quality by reducing drag, increasing fuel efficiency and offering users a stable riding boat. Our home base operations in Fort Pierce, Florida is a 7.5-acre facility with several buildings totaling approximately 100,000 square feet, including a recently completed 30,000 square foot expansion which began in mid-2024. We currently employ approximately 85 people.

Current wording

Twin Vee PowerCats Co. (“Twin Vee” “we”, “us” or the “Company”) is a designer, manufacturer and marketer of recreational and commercial power boats. We believe our company, founded in 1996, has been an innovator in the recreational and commercial power catamaran industry. Our twin-hull catamaran running surface, known as a symmetrical catamaran hull design, adds to the Twin Vee ride quality by reducing drag, increasing fuel efficiency and offering users a stable riding boat. Our home base operations in Fort Pierce, Florida is a 7.5-acre facility with several buildings totaling approximately 100,000 square feet, including a recently completed 30,000 square foot expansion which began in mid-2024. We currently employ approximately 70 people.

Previous wording

Revenue from the sale of our boats accounted for 100% of our net revenue in the second quarter of 2025 and for the fiscal year 2024. Our boats are manufactured in Fort Pierce, Florida. We believe our company has been an innovator in the recreational and commercial power boat industry. We currently have 12 Twin Vee models in or nearing production ranging in size from 24-foot to 40-foot, and 9 monohull (Bahama) models in or nearing production ranging in size from 22-foot to 41-foot.

Current wording

Revenue from the sale of our boats accounted for nearly 100% of our net revenue in the third quarter of 2025 and for the fiscal year 2024. Our boats are manufactured in Fort Pierce, Florida. We believe our company has been an innovator in the recreational and commercial power boat industry. We currently have 12 Twin Vee models in or nearing production ranging in size from 24-foot to 40-foot, and 9 monohull (Bahama) models in or nearing production ranging in size from 22-foot to 41-foot. Revenues are also derived from the sale of short-term contracts to provide used boat listing services through Wizz Banger, Inc., which is recognized into revenues over the life of the contract.

Previous wording

During the quarter ended June 30, 2025, three individual dealers each represented over 10% of our total sales and together represented 70% of total sales. During the quarter ended June 30, 2024, three individual dealers each represented over 10% of our total sales, and combined they represented 49% of total sales.

Current wording

During the quarter ended September 30, 2025, four individual dealers each represented over 10% of our total sales and together represented 83% of total sales. During the quarter ended September 30, 2024, four individual dealers each represented over 10% of our total sales and together represented 67% of total sales.

Previous wording

Our unaudited financial statements for the three and six months ended June 30, 2025 were prepared under the assumption that we will continue as a going concern; however, we have incurred significant losses from operations to date and we expect our expenses to increase in connection with our ongoing activities. These factors raise substantial doubt about our ability to continue as a going concern for one year after the financial statements included in this Quarterly Report are issued. See “Liquidity and Capital Resources” below.

Current wording

Our unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2025 were prepared under the assumption that we will continue as a going concern; however, we have incurred significant losses from operations to date and we expect our expenses to increase in connection with our ongoing activities. These factors raise substantial doubt about our ability to continue as a going concern for one year after the financial statements included in this Quarterly Report are issued. See “Liquidity and Capital Resources” below.

Previous wording

On May 8, 2025, we entered into an underwriting agreement (the “Underwriting Agreement”) with ThinkEquity LLC, as representative of the several underwriters named therein (the “Representative”), pursuant to which we agreed to sell to the Representative in a firm commitment underwritten public offering (the “May 2025 Offering”) an aggregate of 750,000 shares (the “Shares”) of our common stock at the public offering price of $4.00 per share, resulting in gross proceeds of $3.0 million, before deducting underwriting discounts, commissions and offering expenses. The Shares were sold pursuant to an effective shelf registration statement on Form S-3 (File No. 333-266858) filed with the SEC under the Securities Act and declared effective by the Commission on August 24, 2022, a base prospectus, dated August 24, 2022, included in the Registration Statement at the time it originally became effective, and a prospectus supplement, dated May 8, 2025, filed with the Commission pursuant to Rule 424(b) under the Securities Act. Pursuant to the Underwriting Agreement, we also issued to designees of the Representative unregistered warrants to purchase up to 37,500 shares of our common stock, which equals 5% of the shares of common stock purchased in the May 2025 Offering. The May 2025 Offering closed on May 12, 2025. The net proceeds to us from the May 2025 Offering, after deducting the underwriting discount, the Representative’s fees and expenses and our estimated offering expenses, were $2,555,100.

Current wording

On May 8, 2025, we entered into an underwriting agreement (the “Underwriting Agreement”) with ThinkEquity LLC, as representative of the several underwriters named therein (the “Representative”), pursuant to which we agreed to sell to the Representative in a firm commitment underwritten public offering (the “May 2025 Offering”) an aggregate of 750,000 shares (the “Shares”) of our common stock at the public offering price of $4.00 per share, resulting in gross proceeds of $3.0 million, before deducting underwriting discounts, commissions and offering expenses. The Shares were sold pursuant to an effective shelf registration statement on Form S-3 (File No. 333-266858) filed with the SEC under the Securities Act and declared effective by the Commission on August 24, 2022,

Previous wording

On April 21, 2025, Northpoint Commercial Finance LLC (“Northpoint”) came into possession of certain Twin Vee and AquaSport inventory of United Marine and Storage LLC, a former dealer of our products. Northpoint requested that we take possession of and repurchase the inventory in accordance with the Repurchase Agreement that we previously entered into with Northpoint. During the second quarter, we sold five of the six repossessed boats, recording a net loss on the sale of approximately $14,000 after transportation, refurbishment, and commissions. We have a remaining repurchase obligation on the last boat of $58,984.

Current wording

On April 21, 2025, Northpoint Commercial Finance LLC (“Northpoint”) came into possession of certain Twin Vee and AquaSport inventory of United Marine and Storage LLC, a former dealer of our products. Northpoint requested that we take possession of and repurchase the inventory in accordance with the Repurchase Agreement that we previously entered into with Northpoint. During the second quarter, we sold five of the six repossessed boats, resulting in a net loss on the sale of approximately $14,875 after transportation, refurbishment, and commissions for the second quarter. During the third quarter, we paid our obligation to Northpoint for our one remaining repurchase obligation of $58,984 and are currently marketing this boat for sale. We expect to fully recover the amount of the repurchase obligation.

Previous wording

Our net sales increased by $428,797, or 10%, to $4,755,618 for the three months ended June 30, 2025, from $4,326,821 for the three months ended June 30, 2024. This increase was due primarily to the success of our new dealer initiatives, which added 14 new dealer/locations during the first six months of 2025. During the second quarter of 2025, we sold 31 boats at an average selling price of approximately $153,000 per unit, compared to 34 units in the second quarter of 2024 with an average selling price of approximately $187,000. This reduction in unit price is due primarily to mix, where two 40-foot boats were delivered in the second quarter of 2024 versus one in the second quarter of 2025.

Current wording

Our net sales increased by $527,659, or 18%, to $3,428,977 for the three months ended September 30, 2025, from $2,901,318 for the three months ended September 30, 2024. This increase was due primarily to the success of our new dealer initiatives, which added 14 new dealer/locations during the first nine months of 2025. During the third quarter of 2025, we sold 23 boats at an average selling price of approximately $149,000 per unit, compared to 20 units in the third quarter of 2024 with an average selling price of approximately $145,000.

Previous wording

Gross profits improved by $451,713, or 223%, to $654,053 for the three months ended June 30, 2025, from $202,340 for the three months ended June 30, 2024. Gross profit as a percentage of sales for the three months ended June 30, 2025 was 13.8% compared to 4.7% in the second quarter of 2024. This improvement in gross profit of 9.1 percentage points, while sales declined 10%, reflects our ongoing efforts to reduce our cost structure, such as bringing certain manufacturing operations in-house, and better utilization of our ERP system leveraged against higher volumes.

Current wording

Gross loss improved by $100,428, or 69%, to a loss of $45,229 for the three months ended September 30, 2025, from a loss of $145,657 for the three months ended September 30, 2024. Gross loss as a percentage of sales for the three months ended September 30, 2025 was -1.3% compared to -5.0% in the third quarter of 2024. This improvement in gross profit of 3.7 percentage points, is a result of our 18% increase in revenues and reflects our ongoing efforts to reduce our cost structure, such as bringing certain manufacturing operations in-house, and better utilization of our ERP system leveraged against higher volumes.

Previous wording

During the three months ended June 30, 2025 and 2024, total operating expenses were $2,329,859 and $4,861,416, respectively, a decrease of 52%. Included in the second quarter 2024 operating expenses were $1,674,000 related to the impairment of property and equipment at the prior Forza operating unit.

Current wording

During the three months ended September 30, 2025 and 2024, total operating expenses were $2,731,466 and $2,966,160, respectively, a decrease of 8%. Included in the third quarter 2025 operating expenses were $360,151 related to the impairment of property and equipment at the prior Forza operating facility.

Previous wording

Selling, general, and administrative expenses decreased by approximately 20%, or $150,686, to $605,273 for the three months ended June 30, 2025, compared to $755,959 for the three months ended June 30, 2024. The decrease was primarily due to reductions in marketing and advertising and the cancelation of rents that were previously paid for the former Forza facility in North Carolina.

Current wording

Selling, general, and administrative expenses decreased by approximately 15%, or $114,029, to $650,728 for the three months ended September 30, 2025, compared to $764,757 for the three months ended September 30, 2024. The decrease was primarily due to the cancelation of rents that were previously paid for the former Forza facility in North Carolina, lower public company filing fees related to the merger and closure of Forza, reductions in other compliance costs and general cost controls across other discretionary spending categories such as travel and hiring costs.

Previous wording

Salaries and wage related expenses decreased 12%, or $144,245, to $1,055,103 for the three months ended June 30, 2025, compared to $1,199,348 for the three months ended June 30, 2024. The majority of the decrease is due to reductions in staffing levels at Forza and a reduction in stock-based compensation. Stock based compensation was $59,629 and $317,744 in the second quarter of 2025 and 2024, respectively.

Current wording

Salaries and wage related expenses decreased 11%, or $128,574, to $1,016,894 for the three months ended September 30, 2025, compared to $1,145,568 for the three months ended September 30, 2024. The majority of the decrease is due to reductions in staffing levels at Forza and a reduction in stock-based compensation. Stock based compensation was $63,897 and $278,867 in the third quarter of 2025 and 2024, respectively.

Previous wording

Research and development expenses were $0 in the second quarter of 2025 compared to $344,784 in the second quarter of 2024. This decrease was due to the wind down of electric boat development.

Current wording

Research and development expenses were $0 in the third quarter of 2025 compared to $89,403 in the third quarter of 2024. This decrease was due to the wind down of electric boat development.

Previous wording

Professional fees decreased by 58%, or $261,860, to $190,507 for the three months ended June 30, 2025, compared to $452,367 for the three months ended June 30, 2024. This decrease was due primarily to the reduction in legal and accounting costs as a result Forza X1 merging into Twin Vee and no longer being a standalone public company.

Current wording

Professional fees decreased by 49%, or $196,589, to $206,798 for the three months ended September 30, 2025, compared to $403,387 for the three months ended September 30, 2024. This decrease was due primarily to the reduction in legal and accounting costs as a result Forza X1 being merged into Twin Vee and no longer being a standalone public company.

Previous wording

Depreciation and amortization expense decreased by 2%, or $9,407, to $425,551 for the three months ended June 30, 2025, as compared to $434,958 for the three months ended June 30, 2024. This decrease is due to the addition of fixed assets, primarily molds, to increase our production levels and throughput, offset by reductions in the asset base related to the wind down of Forza in late 2024.

Current wording

Depreciation and amortization expense decreased by 5%, or $20,633 to $419,825 for the three months ended September 30, 2025, as compared to $440,458 for the three months ended September 30, 2024. This decrease is due to reductions in the asset base related to dispositions and disposals of certain property and equipment, primarily related to the wind down of Forza in late 2024, partially offset by the addition of fixed assets, primarily molds, to increase our production levels and throughput.

Previous wording

Other income decreased by $118,145 to $21,735 for the three months ended June 30, 2025, as compared to $139,880 for the three months ended June 30, 2024. This decrease was due primarily to a reduction in dividend and interest income from lower cash and cash equivalent balances.

Current wording

Other income decreased by $80,728 to $21,182 for the three months ended September 30, 2025, as compared to $101,910 for the three months ended September 30, 2024. This decrease was due primarily to a reduction in dividend and interest income from lower cash and cash equivalent balances.

Previous wording

Net loss for the three months ended June 30, 2025 was $1,654,071, as compared to $4,519,196 for the three months ended June 30, 2024, an improvement of $2,865,125 or 63%. The overall year-over-year improvement in the reported loss for the period was due to the improvement in gross margin resulting from improved cost management and efficiency in the factory and the reduction in costs related to electric boat development. Basic and dilutive loss per share of Common Stock for the three months ended June 30, 2025 was ($0.87), as compared to ($3.09) for the three months ended June 30, 2024, an improvement of 72%.

Current wording

Net loss for the three months ended September 30, 2025 was $2,755,513, as compared to $3,009,907 for the three months ended September 30, 2024, an improvement of $254,394 or 8%. The overall year-over-year improvement in the reported loss for the period was due to the improvement in gross margin resulting from improved cost management and efficiency in the factory and the reduction in costs related to electric boat development. Basic and dilutive loss per share of Common Stock for the three months ended September 30, 2025 was ($1.23), as compared to ($2.64) for the three months ended September 30, 2024, an improvement of 53%.

Previous wording

Our net sales decreased by $1,235,255, or 13% to $8,367,909 for the six months ended June 30, 2025 from $9,603,164 for the six months ended June 30, 2024. This decrease was due primarily to the mix of boats sold and the unit pricing between periods. We sold 55 and 56 boats during the first six months of 2025 and 2024, respectively. The average unit price per boat was approximately $152,000 in the first six months of 2025 compared to $171,000 in the first six months of 2024. This decrease is due primarily to the sale of four 40’ boats in the first six months of 2024 compared to one in the first six months of 2025.

Current wording

Our net sales decreased by $707,596, or 6% to $11,796,886 for the nine months ended September 30, 2025 from $12,504,482 for the nine months ended September 30, 2024. This decrease was due primarily to the mix of boats sold and the unit pricing between periods. We sold 78 and 76 boats during the first nine months of 2025 and 2024, respectively. The average unit price per boat was approximately $151,000 in the first nine months of 2025 compared to $166,000 in the first nine months of 2024. This decrease in the average price per boat was due primarily due to the introduction of the 22’ BayCat in April 2025, which sold 15 units at an average price of below $100,000.

Previous wording

Gross profits increased by $711,514, or 148%, to $1,191,167 for the six months ended June 30, 2025, from $479,653 for the six months ended June 30, 2024. Gross profit as a percentage of sales, for the six months ended June 30, 2025 and 2024, was 14.2% and 5.0% respectively. This 9.2% increase in gross margin was achieved through continuous efficiency improvements offset the impact of fixed cost deleveraging in the production facility as revenues declined 13% over the same period last year.

Current wording

Gross profits increased by $811,942, or 243%, to $1,145,938 for the nine months ended September 30, 2025, from $333,996 for the nine months ended September 30, 2024. Gross profit as a percentage of sales, for the nine months ended September 30, 2025 and 2024, was 9.7% and 2.7% respectively. This 7.0% increase in gross margin was achieved through continuous efficiency improvements offset by the impact of fixed cost deleveraging in the production facility as revenues declined 6% over the same period last year.

Previous wording

During the six months ended June 30, 2025, operating expenses were $4,546,067 compared to $7,681,934 in the same period in 2024, a decrease of $3,135,867 or 41%. The first six months of 2024 included an impairment charge of $1,674,000 related to the Forza impairment of property & equipment.

Current wording

During the nine months ended September 30, 2025, operating expenses were $7,277,533 compared to $10,648,096 in the same period in 2024, a decrease of $3,370,563 or 32%. The first nine months of 2025 and 2024 included an impairment charge of $360,151 and $1,674,000, respectively, related to the Forza impairment of property & equipment.

Previous wording

Selling, general, and administrative expenses decreased by approximately 17%, or $246,087, to $1,203,825 for the six months ended June 30, 2025, compared to $1,449,912 for the six months ended June 30, 2024. The largest drivers of the decrease were reductions in rent from the wind down of the Forza operations in the prior year, sales and marketing expenses, and D&O insurance.

Current wording

Selling, general, and administrative expenses decreased by approximately 16%, or $360,117, to $1,854,553 for the nine months ended September 30, 2025, compared to $2,214,670 for the nine months ended September 30, 2024. The largest drivers of the decrease were reductions in rent from the wind down of the Forza operations in the prior year, sales and marketing expenses, and D&O insurance, other compliance costs and reductions in discretionary spending categories such as travel and hiring costs.

Previous wording

Salaries and wage related expenses decreased 19%, or $473,551, to $2,022,065 for the six months ended June 30, 2025, compared to $2,495,616 for the six months ended June 30, 2024. The majority of the decrease is due to reductions in stock-based compensation and staffing levels at Forza, as well as the staffing of AquaSport. Included in salaries and wage related expenses for the six months ended June 30, 2025 and 2024 was stock-based compensation expense of $115,599 and $744,027, respectively.

Current wording

Salaries and wage related expenses decreased 17%, or $602,226, to $3,038,959 for the nine months ended September 30, 2025, compared to $3,641,185 for the nine months ended September 30, 2024. The majority of the decrease is due to reductions in stock-based compensation and staffing levels at Forza, as well as the staffing of AquaSport. Included in salaries and wage related expenses for the nine months ended September 30, 2025 and 2024 was stock-based compensation expense of $179,493 and $1,022,894, respectively.

Previous wording

Research and development expenses were $0 and $494,475 for the six months ended June 30, 2025 and 2025, respectively. This decrease was due to the wind down of the electric boat development in 2024.

Current wording

Research and development expenses were $0 and $583,878 for the nine months ended September 30, 2025 and 2024, respectively. This decrease was due to the wind down of the electric boat development in 2024.

Previous wording

Professional fees decreased by 52% or $371,174, to $336,518 for the six months ended June 30, 2025, compared to $707,692 for the six months ended June 30, 2024. This decrease was due primarily to the reduction in legal and accounting costs as a result Forza X1 merging into Twin Vee and no longer being a standalone public company.

Current wording

Professional fees decreased by 51% or $567,763, to $543,316 for the nine months ended September 30, 2025, compared to $1,111,079 for the nine months ended September 30, 2024. This decrease was due primarily to the reduction in legal and accounting costs as a result Forza X1 being merged into Twin Vee and no longer being a standalone public company.

Previous wording

Depreciation and amortization expense increased by 1%, or $6,984, to $867,223 for the six months ended June 30, 2025, as compared to $860,239 for the six months ended June 30, 2024. This decrease is due to the addition of fixed assets, primarily molds, to increase our production levels and throughput offset by reductions in the asset base related to the wind down of Forza in late 2024.

Current wording

Depreciation and amortization expense decreased by 1%, or $13,649, to $1,287,048 for the nine months ended September 30, 2025, as compared to $1,300,697 for the nine months ended September 30, 2024. This decrease is due to reductions in the asset base related to dispositions and disposals of certain property and equipment, primarily related to the wind down of Forza in late 2024, partially offset by the addition of fixed assets, primarily molds, to increase our production levels and throughput.

Previous wording

Other income decreased by $257,302 to $90,589 for the six months ended June 30, 2025, as compared to $347,891 for the six months ended June 30, 2024. This decrease was due primarily to a reduction in dividend and interest income from lower cash and cash equivalent balances.

Current wording

Other income decreased by $338,031 to $111,771 for the nine months ended September 30, 2025, as compared to $449,802 for the nine months ended September 30, 2024. This decrease was due primarily to a reduction in dividend and interest income from lower cash and cash equivalent balances.

Previous wording

Net loss for the six months ended June 30, 2025 was $3,264,311, as compared to $6,854,390 for the six months ended June 30, 2024, an improvement of $3,590,079 or 52%. The overall year-over-year improvement in the reported loss for the period was due to the improvement in gross margin resulting from improved cost management and efficiency in the factory and the reduction in costs related to electric boat development. Basic and dilutive loss per share of Common Stock for the six months ended June 30, 2025 was ($1.93), as compared to ($4.87) for the six months ended June 30, 2024, an improvement of 60%.

Current wording

Net loss for the nine months ended September 30, 2025 was $6,016,824, as compared to $9,864,298 for the nine months ended September 30, 2024, an improvement of $3,844,474 or 39%. The overall year-over-year improvement in the reported loss for the period was due to the improvement in gross margin resulting from improved cost management and efficiency in the factory and the reduction in costs related to electric boat development. Basic and dilutive loss per share of Common Stock for the nine months ended September 30, 2025 was ($3.21), as compared to ($7.50) for the nine months ended September 30, 2024, an improvement of 57%.

Previous wording

We have classified $4,334,523 of building and land in Marion, North Carolina as an asset held for sale under ASC 360 and included it as a separate line item on the condensed consolidated balance sheet as of June 30, 2025. In 2024, we completed the merger of Forza X1, Inc. and ceased the expenditures related to the development of electric boats. The building is now being marketed for sale. While the timing of the sale is uncertain, we are cautiously optimistic of the sale to be completed within one year and it is expected to generate substantial cash to fund future operations.

Current wording

We have classified $3,956,623 of building and land in Marion, North Carolina as an asset held for sale under ASC 360 and included it as a separate line item on the condensed consolidated balance sheet as of September 30, 2025. In 2024, we completed the merger of Forza X1, Inc. and ceased the expenditures related to the development of electric boats. On September 26, 2025, we entered into a purchase and sale agreement with Highland Myco Holdings, LLC for the sale of our property located at 100 College Drive, Marion, North Carolina, which was completed on October 31, 2025. We received $500,000 as a closing payment, with an additional $3,750,000 payable in installments of $500,000 plus accrued interest at a rate of 5% on October 31, 2026, $500,000 plus accrued interest on April 30, 2027, and a balloon payment of $2,750,000 plus accrued interest on October 31, 2027.

Previous wording

For the year ended December 31, 2024, we incurred a loss from operations of $14,551,769 and a net loss of $14,009,906. For the six months ended June 30, 2025, we incurred a loss from operations of $3,354,900 and a net loss of $3,264,311. As of June 30, 2025 and December 31, 2024 we had accumulated deficits of $28,657,266 and $25,392,955, respectively. To mitigate these conditions::

Current wording

For the year ended December 31, 2024, we incurred a loss from operations of $14,551,769 and a net loss of $14,009,906. For the nine months ended September 30, 2025, we incurred a loss from operations of $6,131,595 and a net loss of $6,019,824. As of September 30, 2025 and December 31, 2024 we had accumulated deficits of $31,412,779 and $25,392,955, respectively. To address these conditions:

Previous wording

Despite our ongoing efforts to mitigate these conditions, there can be no assurance that our expenses will not continue to increase in future periods or that the cash generated from operations in future periods will be sufficient to satisfy our operating needs. Although we have classified $4,334,523 of building and land in Marion, North Carolina as an asset held for sale, the proceeds of which will help our liquidity, there can be no assurance that we will be able to sell the land and building in the next twelve months and if we do engage in such a sale, that the proceeds will be as expected. If we need to raise additional capital to fund our continued operations, there can be no assurance that funding will be available on acceptable terms on a timely basis, or at all. The various ways that we could raise capital carry potential risks. Any additional sources of financing will likely involve the issuance of our equity securities, which will have a dilutive effect on our stockholders. Any debt financing, if available, may involve restrictive covenants that may impact our ability to conduct our business. If we do not succeed in raising additional funds on acceptable terms or at all, we may be unable to fill new orders and develop new products. As such, we cannot conclude that such plans will be effectively implemented within one year after the date that the financial statements included in this Quarterly Report are filed with the SEC, and there is uncertainty regarding our ability to maintain liquidity sufficient to operate our business effectively, which raises substantial doubt about our ability to continue as a going concern. If we are unable to generate sufficient revenue from operations and/or raise capital when needed or on attractive terms, we be forced to delay, reduce or eliminate efforts to expand our dealer network or develop new models and may be forced to cease operations or liquidate assets.

Current wording

Despite our ongoing efforts to mitigate these conditions, there can be no assurance that our expenses will not increase in future periods or that the cash generated from operations in future periods will be sufficient to satisfy our operating needs. If we need to raise additional capital to fund our continued operations, there can be no assurance that funding will be available on acceptable terms on a timely basis, or at all. The various ways that we could raise capital carry potential risks. Any additional sources of financing will likely involve the issuance of our equity securities, which will have a dilutive effect on our stockholders. Any debt financing, if available, may involve restrictive covenants that may impact our ability to conduct our business. If we do not succeed in raising additional funds on acceptable terms or at all, we may be unable to fill new orders and develop new products. As such, we cannot conclude that such plans will be effectively implemented within one year after the date that the financial statements included in this Quarterly Report are filed with the SEC, and there is uncertainty regarding our ability to maintain liquidity sufficient to operate our business effectively, which raises substantial doubt about our ability to continue as a going concern. If we are unable to generate sufficient revenue from operations and/or raise capital when needed or on attractive terms, we be forced to delay, reduce or eliminate efforts to expand our dealer network or develop new models and may be forced to cease operations or liquidate assets.

Previous wording

As of June 30, 2025, we had $6,176,785 of cash, cash equivalents, and restricted cash, total current assets of $13,392,948 and total assets of $22,357,946. Our total liabilities were $3,734,710. Our total liabilities were comprised of current liabilities of $3,203,858, which included accounts payable and accrued liabilities of $2,951,760, lease liabilities of $239,598 and contract liability of $12,500. Long term liabilities were $530,852. As of December 31, 2024, we had $7,706,240 of cash, cash equivalents, and restricted cash, total current assets of $10,419,141 and total assets of $25,887,905. Our total current liabilities were $3,747,990 and total liabilities were $6,671,055 which included long-term finance leases liabilities of $2,423,165.

Current wording

As of September 30, 2025, we had $2,919,688 of cash, cash equivalents, and restricted cash, total current assets of $10,053,775 and total assets of $18,894,710. Our total liabilities were $2,963,090. Our total liabilities were comprised of current liabilities of $2,436,828, which included accounts payable and accrued liabilities of $2,009,115, lease liabilities of $129,826 and contract liability of $297,887. Long term liabilities were $526,262. As of December 31, 2024, we had $7,706,240 of cash, cash equivalents, and restricted cash, total current assets of $10,419,141 and total assets of $25,887,905. Our total current liabilities were $3,747,990 and total liabilities were $6,671,055 which included long-term finance leases liabilities of $2,423,165.

Previous wording

The accumulated deficit was $28,657,266 as of June 30, 2025 compared to accumulated deficit of $25,392,955 as of December 31, 2024.

Current wording

The accumulated deficit was $31,412,779 as of September 30, 2025 compared to accumulated deficit of $25,392,955 as of December 31, 2024.

Previous wording

Our working capital increased by $3,517,939 to $10,189,090 as of June 30, 2025, compared to $6,671,151 on December 31, 2024 primarily due to the May 2025 Offering of 750,000 shares in the second quarter of 2025, netting approximately $2,555,100 after discounts and fees and the reclassification of assets held for sale to current assets, partially offset by continued operating losses incurred in the period, the cash requirement of the facilities capacity expansion and efficiency project in Ft. Pierce, Florida, and investments in Wizz Banger.

Current wording

Our working capital increased by $945,796 to $7,616,947 as of September 30, 2025, compared to $6,671,151 on December 31, 2024 primarily due to the May 2025 Offering of 750,000 shares in the second quarter of 2025, netting approximately $2,555,100 after discounts and fees and the reclassification of assets held for sale to current assets, partially offset by continued operating losses incurred in the period, the cash requirement of the facilities capacity expansion and efficiency project in Fort Pierce, Florida, and investments in Wizz Banger.

Previous wording

For the six months ended June 30, 2025, net cash used in operating activities was $2,481,889, compared to $2,232,013 during the six months ended June 30, 2024. The use of cash in operating activities for the six months ended June 30, 2025 was due primarily to a $3,264,311operating loss adjusted for non-cash depreciation and amortization of $867,223 and stock-based compensation of $115,597.

Current wording

For the nine months ended September 30, 2025, net cash used in operating activities was $5,129,964, compared to $4,638,887 during the nine months ended September 30, 2024. The use of cash in operating activities for the nine months ended September 30, 2025 was due primarily to a $6,131,595 operating loss adjusted for non-cash depreciation and amortization of $1,287,048 and stock-based compensation of $179,493.

Previous wording

During the six months ended June 30, 2025, cash used in investing activities was $1,497,435, due to investments in property, plant and equipment, including investments in Wizz Banger and Bahama Boat Works. This compares to use of cash in investing activities of $247,855 in the six months ended June 30, 2024 resulting from the sale of marketable securities and the purchase of property and equipment.

Current wording

During the nine months ended September 30, 2025, cash used in investing activities was $1,950,362, due to investments in property, plant and equipment, including investments in Wizz Banger and Bahama Boat Works. This compares to use of cash in investing activities of $567,889 in the nine months ended September 30, 2024 resulting from purchase of property and equipment.

Previous wording

For the six months ended June 30, 2025, net cash provided by financing activities was approximately $2,449,992 due primarily to the May 2025 Offering of 750,000 common shares for net proceeds of $2,555,100. For the six months ended June 30, 2024, net cash used in financing activities was approximately $137,029, respectively from finance lease obligations.

Current wording

For the nine months ended September 30, 2025, net cash provided by financing activities was approximately $2,293,774 due primarily to the May 2025 Offering of 750,000 common shares for net proceeds of $2,555,101. For the nine months ended September 30, 2024, net cash used in financing activities was approximately $190,565, respectively from finance lease obligations.