What changed in this filing

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Item 1. Financial Statements

2026-05-15 compared with 2025-11-12 · 665 added, 569 removed, 270 unchanged (82% of the section changed)

Financial Statements.

GENERAL ENTERPRISE VENTURES, INC.

UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheets (unaudited)

Consolidated statements of Operations and Comprehensive Loss (unaudited)

Consolidated Statements of Changes in Stockholders’ Equity (unaudited)

Consolidated Statements of Cash Flows (unaudited)

Consolidated Notes to Financial Statements (unaudited)

General Enterprise Ventures, Inc.

CitroTech Inc.

(formerly General Enterprise Ventures, Inc.)

Index to Unaudited Interim Consolidated Financial

March 31, 2026

Consolidated Balance Sheets at March 31, 2026 and December 31, 2025

Consolidated Statements of

Operations and Comprehensive Loss for the three months ended March 31, 2026 and 2025

Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2026 and 2025

Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025

Notes to Consolidated Financial Statements

CitroTech Inc.

(formerly General Enterprise Ventures, Inc.)

Consolidated Balance Sheets

September 30,

Current Assets

Accounts receivable, net

Prepaid expenses and other current assets

Deferred offering costs

Prepaid expenses

Total Current Assets

3 unchanged sentences

Equipment, net

Security deposit

Security deposits

Total Non-Current Assets

3 unchanged sentences

Deferred revenue

Convertibles notes, net of discount

Convertibles notes, net of discount - related parties

Convertible notes, net of discount

Convertible notes, net of discount - related party

Due to related parties

Financing loan - current portion

Derivative liability

Operating lease liability - current portion

3 unchanged sentences

Operating lease liability

Total Non-Current Liabilities

Total Liabilities

1 unchanged sentence

Preferred Stock, par value $ 0.0001 , authorized 30,000,000 shares:

Series A Preferred Stock, par value $ 0.0001 , designated 10,000,000 shares, 1,666,667 shares issued and outstanding

Series C Convertible Preferred Stock, par value $ 0.0001 , designated 10,000,000 shares, 763,700 and 3,001,969 shares issued and outstanding, respectively

Common Stock, par value $ 0.0001 , authorized 1,000,000,000 shares, 17,702,912 and 6,140,264 shares issued and 17,552,912 and 6,140,264 shares outstanding, respectively

Series A Preferred Stock, par value $ 0.0001 , designated 10,000,000 shares, 1,666,667 shares issued and

Series C Convertible Preferred Stock, par value $ 0.0001 , designated 10,000,000 shares, 807,668 shares

issued and shares outstanding

Common Stock, par value $ 0.0001 , authorized 1,000,000,000 shares, 19,116,901 and 18,522,315 issued and outstanding,

Additional paid-in capital

4 unchanged sentences

Total Liabilities and Stockholders' Equity

See the accompanying Notes, which are an integral part of these unaudited consolidated financial statements.

General Enterprise Ventures, Inc.

Consolidated Statements of Operations and Comprehensive Loss

The accompanying

notes are an integral part of these unaudited interim consolidated financial statements.

CitroTech Inc.

(formerly General Enterprise Ventures, Inc.)

Consolidated Statements of Operations and Comprehensive

Three months ended

Nine months ended

September 30,

Operating expenses

2 unchanged sentences

Amortization and depreciation

General and administration

General and administrative

Advertising and marketing

2 unchanged sentences

Professional fees - related parties

Research and development expense

Total operating expenses

2 unchanged sentences

( 3,458,456 )

( 4,105,313 )

Other income (expense)

Interest expense

( 1,323,112 )

Interest expense - related party

( 1,255,337 )

Interest income

1 unchanged sentence

( 6,167,334 )

Gain (loss) on fair value of derivative liability

( 2,002,767 )

Loss on fair value of derivative liability

Loss on settlement of debt

( 4,130,203 )

( 6,770,814 )

Total other expense

4 unchanged sentences

( 10,903,404 )

( 5,082,352 )

Provision for income taxes

1 unchanged sentence

$ ( 10,903,404 )

$ ( 30,736,631 )

$ ( 5,082,352 )

Comprehensive loss

1 unchanged sentence

$ ( 10,903,404 )

$ ( 30,736,631 )

$ ( 5,082,352 )

Net loss per common share - basic and diluted

Basic and diluted weighted average number of common shares outstanding

See the accompanying Notes, which are an integral part of these unaudited consolidated financial statements.

General Enterprise Ventures, Inc.

Consolidated Statements of Change in Stockholders’ Equity

For the three and nine months ended September 30, 2025

The accompanying

notes are an integral part of these unaudited interim consolidated financial statements.

CitroTech Inc.

(formerly General Enterprise Ventures, Inc.)

Consolidated Statements of Changes in Stockholders’

For the three months ended March 31, 2026

Series C Convertible

Preferred stock

Stockholders'

1 unchanged sentence

$ 124,463,845

Series C Preferred Stock issued for cash

Series C Preferred Stock issued for services

Series C Preferred Stock issued for compensation

Common stock issued for conversion of Series C Preferred Stock

Common stock warrants issued

$ ( 113,203,031 )

( 10,903,404 )

Balance - March 31, 2025

( 87,268,792 )

Series C Preferred Stock issued for services

Series C Preferred Stock for compensation

Common stock issued for conversion of Series C Preferred Stock

Common stock issued for services

Common stock issued for conversion of debts

Management stock compensation

( 11,904,019 )

Balance - June 30, 2025

$ 101,361,932

$ ( 99,172,811 )

Series C Preferred Stock issued for cash

Series C Preferred Stock issued for services

Series C Preferred Stock issued for compensation

Common stock issued for conversion of debt

Common stock issued for conversion of Series C Preferred Stock

( 1,705,000 )

Common stock issued for services

Common stock issued for cashless exercise of warrants

Common stock issued for stock payable

Management stock compensation

Reclassification of derivative liability to equity

Reverse stock split adjustment

( 6,210,564 )

Balance - September 30, 2025

Balance - March 31, 2026

$ 128,096,468

$ ( 119,413,595 )

See the accompanying Notes, which are an integral part of these unaudited consolidated financial statements.

General Enterprise Ventures, Inc.

Consolidated Statements of Change in Stockholders’ Equity

For the three and nine months ended September 30, 2024

Series C Convertible

Preferred Stock

Preferred stock

For the three months ended March 31, 2025

Convertible Series A

Convertible Series C

Stockholders'

1 unchanged sentence

$ ( 76,365,388 )

Series C Preferred Stock issued for preferred stock to be issued

Series C Preferred Stock issued for cash

Series C Preferred Stock issued for services

Common stock issued for stock to be issued - management

Common stock issued for conversion and settlement of debt

Cancellation of common stock -related party

( 10,833,333 )

Common stock issued for services

Series C Preferred Stock issued for compensation

Common stock issued for conversion of Series C Preferred Stock

Common stock warrants issued

( 10,903,404 )

2 unchanged sentences

$ ( 87,268,792 )

Series C Preferred Stock issued for preferred stock to be issued

Common stock issued for services

Common stock to be issued for services

Balance - June 30, 2024

( 73,910,780 )

Warrants issued in conjunction with convertible debts

Common Stock issued for common stock to be issued

Cancellation of stock to be issued for non performance of services

Balance - September 30, 2024

$ ( 74,566,018 )

See the accompanying Notes, which are an integral part of these unaudited consolidated financial statements.

General Enterprise Ventures, Inc.

Consolidated Statements of Cash Flows

Nine months ended

September 30,

The accompanying

notes are an integral part of these unaudited interim consolidated financial statements.

CitroTech Inc.

(formerly General Enterprise Ventures, Inc.)

Consolidated Statement of Cash Flows

Three months ended

Cash Flows from Operating Activities:

3 unchanged sentences

Stock-based compensation

Financing expense

Stock-based compensation - related party

Non-cash lease expenses

Depreciation and amortization

Amortization and depreciation

Amortization of debt discount

Loss on settlement of debt

Loss on fair value of derivative

Write off of deferred offering costs

Loss on fair value of derivative liability

Changes in operating assets and liabilities:

Accounts receivable

Prepaid expenses and other current assets

Security deposit

Prepaid expenses

Security deposits

Accounts payable and accrued liabilities

Related party advances funding operating expense

Accrued interest - related parties

3 unchanged sentences

( 2,059,341 )

( 1,319,815 )

Cash Flows from Investing Activities:

2 unchanged sentences

Cash Flows from Financing Activities:

Proceeds from convertible notes

Proceeds from convertible note - related party

Payment of deferred offering costs

Repayment of loan - related party

Proceeds from issuance of Series C Preferred Stock

Proceeds from convertible notes and warrants

Proceeds from convertible note and warrants - related party

Payments of deferred offering costs

Proceeds from capital contribution

Proceeds from issuance of Series C Preferred Stock and warrants

Repayment of financing loan

Net Cash provided by Financing Activities

Change in cash

Change in cash for the period

( 1,981,694 )

Cash, beginning of period

4 unchanged sentences

Non-Cash Financing Disclosure:

Common stock issued for services

Series C Preferred stock issued for services

Common stock issued upon conversion of Series C Preferred stock

Common stock issued for conversion and settlement of debt

Common stock issued for stock to be issued - management

Series C Preferred stock issued for subscription received

Cancellation of common stock - related party

Debt modification – related party

Warrants issued in conjunction with convertible debts

Right -of-use assets obtained in exchange for new operating lease liabilities

Recognition of derivative liability as debt discount

Reclassification of derivative liability to additional paid-in capital

Transfer from inventory to property and equipment

Acquisition of property and equipment as financing loan

See the accompanying Notes, which are an integral part of these unaudited consolidated financial statements.

General Enterprise Ventures, Inc.

Notes to Unaudited Consolidated Financial Statements

September 30, 2025

Note 1 – Organization, Business and Liquidity

General Enterprise Ventures, Inc., was originally incorporated under the laws of the State of Nevada on March 14, 1990.

On June 3, 2021, after approval by the board of directors and shareholders of the Company, the Company was redomiciled to the State of Wyoming.

On October 11, 2021, after approval by the board of directors and shareholders of the Company, the Company was renamed General Enterprise Ventures, Inc., in the State of Wyoming.

When used in these notes, the terms “General Enterprise Ventures, Inc.,” “Company,” “we,” “us” and “our” mean General Enterprise Ventures, Inc.

The accompanying

notes are an integral part of these unaudited interim consolidated financial statements.

CitroTech Inc.

(formerly General Enterprise Ventures, Inc.)

Notes to Unaudited Interim Consolidated Financial

March 31, 2026

Note 1 – Organization, Business

and Going Concern

CitroTech Inc.

was originally incorporated

under the laws of the State of Nevada on March 14, 1990 and on June 3, 2021 was redomiciled to the State of Wyoming.

January 22, 2026, the Company changed its name from General Enterprise Ventures, Inc.

to CitroTech Inc.

When used in these notes,

the terms “CITR,” “Company,” “we,” “us” and “our” mean CitroTech Inc.

and all entities included in our unaudited interim consolidated financial statements.

Corporate Changes

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.

We develop and manufacture environmentally sustainable, non-toxic, long-term fire-inhibiting products for use in industrial and wildfire defense applications.

The Company’s proprietary formulation, CitroTech®, is derived from food-grade, renewable materials and is designed to provide an alternative to legacy conventional chemical fire retardants.

CitroTech™ is used in the manufacturing of fire-resilient lumber and building materials, enabling integration of flame-inhibiting properties during production or applied in the field to new homes.

In addition, it is utilized by fire departments, municipalities, and other public and private sector entities in connection with ground-based wildfire defense and stationary application systems intended to help render vegetation non-flammable, reduce ignition risk and enhance structural protection.

The Company continues to evaluate and develop additional formulations and product treatments to expand the range of potential commercial applications for its technology.

Reverse stock split

On April 15, 2025, our Board of Directors and our stockholders that have a majority of our voting power approved an amendment to our articles of incorporation (as amended, the “Articles of Incorporation”) to effect the reverse stock split (which includes the outstanding Series A Preferred Stock and Common Stock of the Company at a 1-for-6 ratio).

The reverse stock split was effective on August 27, 2025.

All share and per share information in these financial statements retroactively reflect this reverse stock split.

The Company has incurred losses since inception and incurred a net loss of $ 30.7 million during the nine months ended September 30, 2025.

However, in September 2025, the Company completed an equity offering which generated net proceeds of $ 5.4 million.

Additionally, in October 2025, the Company completed an equity offering which generated net proceeds of $ 2.7 million (see Note 13).

The Company’s existing cash resources are expected to provide sufficient funds to carry out the Company’s planned operations through fiscal year 2026.

To continue operations beyond such time frame, the Company may be required to raise additional funds by completing additional equity or debt offerings or increasing revenue.

There can be no assurance that the Company will be successful in acquiring additional funding, that the Company’s projections of its future working capital needs will prove accurate, or that any additional funding would be sufficient to continue operations in future years.

Note 2 – Summary of Significant Accounting Policies

We develop and manufacture environmentally sustainable,

non-toxic, long-term fire-inhibiting products for use in industrial and wildfire defense applications.

The Company’s proprietary

formulation, CitroTech®, is derived from food-grade, renewable materials and is designed to provide an alternative to legacy conventional

chemical fire retardants.

CitroTech™ is used in the manufacturing of fire-resilient lumber and building materials, enabling integration

of flame-inhibiting properties during production or applied in the field to new homes.

In addition, it is utilized by fire departments,

municipalities, and other public and private sector entities in connection with ground-based wildfire defense and stationary application

systems intended to help render vegetation non-flammable, reduce ignition risk and enhance structural protection.

The Company continues to evaluate and develop

additional formulations and product treatments to expand the range of potential commercial applications for its technology.

Liquidity and Going Concern

The accompanying unaudited interim consolidated

financial statements of the Company have been prepared assuming the Company will continue as a going concern and in accordance with generally

accepted accounting principles in the United States of America.

The going concern basis of presentation assumes that the Company will

continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge

its liabilities and commitments in the normal course of business.

At March 31, 2026, the Company had cash of

approximately $ 4.3 million,

working capital of $ 2.8

million , and an accumulated deficit of $ 119.4

For the three months ended March 31, 2026, the Company incurred a net loss of $ 6.2

million and used approximately $ 2.1

million of cash in operating activities.

The Company's ability to continue as a going concern depends on its ability to scale

commercial sales.

Management believes that current cash is not sufficient to fund commercial-scale production and the related

working capital requirements for the next twelve months.

These conditions raise substantial doubt about the Company's ability to

continue as a going concern for a period of one year following the issuance date of these unaudited interim consolidated financial

To alleviate these conditions, management is currently

evaluating various funding alternatives and may seek to raise additional funds through the issuance of equity or debt securities, through

arrangements with strategic partners.

As we seek additional sources of financing, there can be no assurance that such financing would

be available to us on favorable terms or at all.

Our ability to obtain additional financing in the capital markets is subject to several

factors, including market and economic conditions, our performance and investor sentiment with respect to us and our industry.

Note 2 – Summary of Significant

Accounting Policies

Basis of Presentation

Our unaudited interim consolidated financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X.

Accordingly, the unaudited interim consolidated financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

However, except as disclosed herein, there has been no material change in the information disclosed in the Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K of General Enterprise Ventures, Inc.

Our unaudited interim consolidated financial statements

and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”)

for interim financial information and with the instructions to Form 10-Q and Regulation S-X.

Accordingly, the unaudited interim consolidated

financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete

financial statements.

However, except as disclosed herein, there has been no material change in the information disclosed in the Notes

to Consolidated Financial Statements included in the Annual Report on Form 10-K of CitroTech Inc.

for the year ended December 31,

In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2025, and its results of operations for the three months and nine months ended September 30, 2025, and 2024, and cash flows for the nine months ended September 30, 2025, and 2024.

The balance sheet at December 31, 2024, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements.

The accompanying unaudited interim consolidated financial statements should be read in conjunction with the unaudited interim consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2024, as filed with the SEC on March 31, 2025.

In the opinion of management, the accompanying

unaudited interim consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary

for a fair statement of its financial position as of March 31, 2026 and its results of operations for the three months ended March 31,

2026 and 2025, and cash flows for the three months ended March 31, 2026 and 2025.

The balance sheet at December 31, 2025, was derived

from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements.

The accompanying unaudited interim consolidated

financial statements should be read in conjunction with the unaudited interim consolidated financial statements and related notes included

in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2025, as filed with the SEC on March 30, 2026.

Principles of Consolidation

The consolidated financial statements include the accounts of General Enterprise Ventures, Inc., and its wholly owned subsidiaries.

The consolidated financial statements include

the accounts of CitroTech Inc., and its wholly owned subsidiaries.

Intercompany transactions and balances have been eliminated.

Reclassification

Certain amounts have been reclassified to improve the clarity and comparability of the financial statements.

These reclassifications had no impact on previously reported total assets, liabilities, equity, net income (loss), or cash flows for any periods presented.

Certain amounts have been reclassified to improve

the clarity and comparability of the financial statements.

These reclassifications had no impact on previously reported total assets,

liabilities, equity, net income (loss), or cash flows for any periods presented.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements.

The estimates and judgments will also affect the reported amounts for certain expenses during the reporting period.

The preparation of financial statements in conformity

with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure

of contingent assets and liabilities at the date of the financial statements.

The estimates and judgments will also affect the reported

amounts for certain expenses during the reporting period.

Actual results could differ from these good faith estimates and judgments.

Segment Information

Our Chief Executive Officer (“CEO”) is the chief operating decision maker who reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance.

Accordingly, we operate in a single reporting segment focused on sustainable long-term flame-retardants and wood treatment technologies.

Our CEO assesses performance and decides how to allocate resources primarily based on consolidated net income, which is reported on our Consolidated Statements of Operations.

Total assets on the Consolidated Balance Sheets represent our segment assets.

Our Chief Executive Officer

(“CEO”) is the chief operating decision maker who reviews financial information on a consolidated basis for purposes of

allocating resources and evaluating financial performance.

Accordingly, we determined we operate in a single

reporting segment - environmentally sustainable specialty chemicals for fire prevention and protection in the lumber and wood

products, wildland fire and residential home industry.

Our CEO assesses performance and decides how to

allocate resources primarily based on consolidated net income, which is reported on our Consolidated Statements of Operations.

on the Consolidated Balance Sheets represent our segment assets.

Cash and Cash Equivalents

For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents.

The Company did not have any cash equivalents as of September 30, 2025 and December 31, 2024.

The Company had cash of $ 6,195,974 and $ 775,133 , as of September 30, 2025 and December 31, 2024, respectively.

Periodically, the Company may carry cash balances at financial institutions more than the federally insured limit of $ 250,000 per institution.

The amount in excess of the FDIC insurance as of September 30, 2025, was approximately $ 5.5 million.

The Company has not experienced losses on account balances and management believes, based upon the quality of the financial institutions, that the credit risk with regard to these deposits is not significant.

For purposes of balance sheet presentation and

reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments

with an original maturity of less than 90 days to be cash and cash equivalents.

The Company did no t have any cash equivalents at

March 31, 2026 and December 31, 2025.

The Company had cash of $ 4.3 million and $ 6.3 million at March 31, 2026 and December 31, 2025,

respectively.

Periodically, the Company may carry cash balances

at financial institutions more than the federally insured limit of $ 250,000 per institution.

The amount in excess of the FDIC insurance

as of March 31, 2026, was approximately $ 3.2 million.

The Company has not experienced losses on account balances and management believes,

based upon the quality of the financial institutions, that the credit risk with regard to these deposits is not significant.

Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear interest.

This value includes an appropriate allowance for estimated uncollectible accounts to reflect any expected loss on the trade accounts receivable balances and charged to the provision for doubtful accounts.

The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make the required payments for services.

Accounts with known financial issues are first reviewed and specific estimates are recorded.

The remaining accounts receivable balances are then grouped in categories by the number of days the balance is past due, and the estimated loss is calculated as a percentage of the total category based upon past history.

Account balances are charged against the allowance when it is probable that the receivable will not be recovered.

During the three and nine months ended September 30, 2025 and 2024, the Company recorded no bad debt expense, and no allowance for credit losses as of September 30, 2025 and December 31, 2024.

Trade accounts receivable are recorded at the

invoiced amount and do not bear interest.

This value includes an appropriate allowance for estimated uncollectible accounts to reflect

any expected loss on the trade accounts receivable balances and charged to the provision for credit loss.

The Company maintains allowances

for credit loss for estimated losses resulting from the inability of its customers to make the required payments for services.

with known financial issues are first reviewed and specific estimates are recorded.

The remaining accounts receivable balances are then

grouped in categories by the number of days the balance is past due, and the estimated loss is calculated as a percentage of the total

category based upon past history.

Account balances are charged against the allowance when it is probable that the receivable will not

be recovered.

During the three months ended March 31, 2026

and 2025, the Company recorded no bad debt expense, and recorded an allowance for credit losses of $ 340,534

and $ 345,950

as of March 31, 2026 and December 31, 2025, respectively.

Fair Value of Financial Instruments

The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement.

The hierarchy requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value.

The three tiers are defined as follows:

The Company uses a three-tier fair value hierarchy

to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured

at fair value on a non-recurring basis, in periods subsequent to their initial measurement.

The hierarchy requires the Company to use

observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value.

The three tiers are defined

Level 1—Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets;

1 unchanged sentence

Level 3—Unobservable inputs that are supported by little or no market data, which require the Company to develop its own assumptions.

Financial instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires the Company to make judgments and consider factors specific to the asset or liability.

The use of different assumptions and/or estimation methodologies may have a material effect on estimated fair values.

Accordingly, the fair value estimates disclosed, or initial amounts recorded, may not be indicative of the amount that the Company or holders of the instruments could realize in a current market exchange.

Recurring Fair Value Measurements

The following table summarizes the liabilities measured at fair value on a recurring basis:

There were no liabilities measured at fair value on a recurring basis as of September 30, 2025.

December 31, 2024

Derivative Liability – conversion feature

Nonrecurring Fair Value Measurements

The valuation of warrants and market based compensation awards, were derived using Level 2 inputs.

Other Fair Value Disclosures

The Company’s financial instruments, including cash, accounts receivable, prepaid expenses, accounts payable and accrued liabilities, deferred revenue and loans payable, are carried at historical cost.

As of September 30, 2025 and December 31, 2024, the carrying amounts of these instruments approximated their fair values because of the short-term nature of these instruments.

Financial instruments measured at fair value are

classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The Company’s

assessment of the significance of a particular input to the fair value measurement in its entirety requires the Company to make judgments

and consider factors specific to the asset or liability.

The use of different assumptions and/or estimation methodologies may have a material

effect on estimated fair values.

Accordingly, the fair value estimates disclosed, or initial amounts recorded, may not be indicative of

the amount that the Company or holders of the instruments could realize in a current market exchange.

The Company’s financial instruments, including

cash, accounts receivable, prepaid expenses, accounts payable and accrued liabilities, deferred revenue and loans payable, are carried

at historical cost.

As of March 31, 2026 and December 31, 2025, the carrying amounts of these instruments approximated their fair values

because of the short-term nature of these instruments.

Convertible Notes

The Company bifurcates conversion options from their host instruments and accounts for them as free-standing derivative financial instruments if certain criteria are met.

The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

Derivative Financial Instruments

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks.

We evaluate all of our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.

For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations.

For our derivative financial instruments, the Company used a Binomial Lattice model to value the derivative instruments at inception and on subsequent valuation dates.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within twelve (12) months of the balance sheet date.

For warrants that are determined to be equity-classified, we estimate the fair value at issuance and record the amounts to additional paid in capital (potentially on a relative fair value basis if issued in a basket transaction with other financial instruments).

Warrants that are equity-classified are not subsequently remeasured unless modified or required to be reclassified as liabilities.

The Company recognizes revenue from its contracts with customers in accordance with ASC 606 – Revenue from Contracts with Customers.

The Company recognizes revenues when satisfying the performance obligation of the associated contract that reflects the consideration expected to be received based on the terms of the contract.

Revenue related to contracts with customers is evaluated utilizing the following steps:

The Company bifurcates conversion options from

their host instruments and accounts for them as free-standing derivative financial instruments if certain criteria are met.

include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely

related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative

instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles

with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative

instrument would be considered a derivative instrument.

Related Parties

The Company follows ASC 850 , “Related

Party Disclosures,” for the identification of related parties and disclosure of related party transactions.

The Company recognizes revenue from its contracts

with customers in accordance with ASC 606 – Revenue from Contracts with Customers.

The Company recognizes revenues

when satisfying the performance obligation of the associated contract that reflects the consideration expected to be received based on

the terms of the contract.

Revenue related to contracts with customers is

evaluated utilizing the following steps:

Identify the contract, or contracts, with a customer;

3 unchanged sentences

Recognize revenue when the Company satisfies a performance obligation.

For the nine months ended September 30, 2025, our revenues currently consist of a sale of product used for lumber products for fire prevention and on installation of self-contained sprinkler systems.

Revenue is recognized at a point in time, that is which the risks and rewards of ownership of the product transfer from the Company to the customer.

For the three months ended March 31, 2026, our

revenues currently consist of a sale of product used for lumber products for fire prevention and on installation of self-contained sprinkler

Revenue is recognized at a point in time when the risks and rewards of ownership of the product transfer from the Company

to the customer.

Deferred revenue

Deferred revenue consists of advanced payments for our service that have not been rendered.

Deferred revenue consists of advanced

payments for our service that have not been rendered.

Revenue is recognized when service is rendered.

As of September 30, 2025 and December 31, 2024, total deferred revenue was $ 6,000 and $ 0 , respectively.

Deferred revenue is expected to be recognized as revenue within the fourth quarter of 2025.

As of March 31, 2026 and

December 31, 2025, total deferred revenue was $ 24,192

and $ 3,000 ,

respectively.

Deferred revenue is expected to be recognized as revenue within the second and third quarters of 2026.

Cost of Revenue

For the three and nine months ended September 30, 2025 and 2024, cost of revenue consisted of:

For the three months ended March 31, 2026 and

2025, cost of revenue consisted of:

Schedule of cost of revenue

Three months ended

Nine months ended

September 30,

Cost of inventory

4 unchanged sentences

Basic and Diluted Net Loss Per Common Share

Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares of common stock outstanding during the period.

Diluted earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued.

For the nine months ended September 30, 2025 and 2024, the following common stock equivalents were excluded from the computation of diluted net loss per share as the result of the computation was anti-dilutive.

September 30,

Net loss per share of common stock requires presentation

of basic and diluted earnings per common share on the face of the Statements of Operations for all entities with complex capital structures

and requires a reconciliation of the numerator and denominator of the basic earnings per share computation to diluted earnings per share.

In the accompanying financial statements, basic net loss per share is computed by dividing net loss by the weighted average number of

shares of common stock outstanding during the period.

Diluted net loss per share is computed by dividing net loss by the weighted average

number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential

dilution that could occur from common shares issuable through contingent share arrangements and warrants unless the result would be antidilutive.

The dilutive effect of share-based payment awards

is calculated using the “treasury stock method,” which assumes that the “proceeds” from the exercise of these

instruments are used to purchase common shares at the average market price for the period.

The dilutive effect of convertible securities

is calculated using the “if-converted method.” Under the if-converted method, securities are assumed to be converted at the

beginning of the period, and the resulting shares of common stock are included in the denominator of the diluted calculation for the entire

period being presented.

For the three months ended March 31, 2026 and

2025, the following common stock equivalents were excluded from the computation of diluted net loss per share as the result of the computation

was anti-dilutive.

Schedule of antidilutive securities

Convertible notes

1 unchanged sentence

Series C Convertible Preferred Stock

Deferred Offering Costs

Costs directly attributable to an offering of equity securities are deferred and would be charged against the gross proceeds of the offering as a reduction of additional paid-in capital.

Deferred offering costs consist of underwriting, legal, accounting, and other expenses incurred through the balance sheet date that are directly related to the proposed public offering.

Should the proposed public offering prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be expensed.

On August 19, 2025, the Company withdrew the registration statement, as a result, the Company expensed deferred offering costs within professional and general and administrative expenses.

As of September 30, 2025 and December 31, 2024, deferred offering costs consisted of the following:

September 30,

Professional fees

General and administrative expenses

Stock-Based Compensation

The Company accounts for employee and non-employee stock awards under ASC 718, Compensation – Stock Compensation, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to nonemployees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable.

Equity grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period.

If an award is granted, but vesting does not occur, any previously recognized compensation cost is reversed in the period related to the termination of service.

During the three and nine months ended September 30, 2025 and 2024, stock-based compensation was recognized as follows:

The Company accounts for employee and non-employee

stock awards under ASC 718, Compensation – Stock Compensation, whereby equity instruments issued to employees for services are recorded

based on the fair value of the instrument issued and those issued to nonemployees are recorded based on the fair value of the consideration

received or the fair value of the equity instrument, whichever is more reliably measurable.

Equity grants are amortized on a straight-line

basis over the requisite service periods, which is generally the vesting period.

If an award is granted, but vesting does not occur, any

previously recognized compensation cost is reversed in the period related to the termination of service.

During the three months ended March 31, 2026

and 2025, stock-based compensation was recognized as follows:

Schedule of stock-based compensation

Three months ended

Nine months ended

September 30,

Management compensation

1 unchanged sentence

Professional fees - related party

Advertising and marketing

Financing expense

$ ( 200,000 )

(*) for the three months ended September 30, 2024, the Company recognized negative expense due to a forfeiture for stock based professional fee.

Compensation cost for stock awards, which include common shares, Series C Preferred Stock, warrants and performance stock units (“PSUs”), is measured at the fair value on the grant date and recognized as expense, net of estimated forfeitures, over the related service or performance period.

The fair value of stock awards is based on the quoted price of our common stock on the grant date and Series C Preferred stock as if converted to common stock.

We measure the fair value of PSUs using a Monte Carlo valuation model and warrants using a Black Scholes valuation model.

Compensation cost for PSUs are recognized using the derived service period and accelerated if the condition is satisfied at an earlier date.

Stock-based compensation

Compensation cost for stock awards, which include

common shares, Series C Convertible Preferred Stock, warrants and performance stock units (“PSUs”), is measured at the fair

value on the grant date and recognized as expense, net of estimated forfeitures, over the related service or performance period.

value of stock awards is based on the quoted price of our common stock on the grant date and Series C Convertible Preferred stock as if

converted to common stock.

We measure the fair value of PSUs using a Monte Carlo valuation model and warrants using a Black Scholes valuation

Compensation cost for PSUs are recognized using the derived service period and accelerated if the condition is satisfied at an

earlier date.

Recently Issued Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures” (Subtopic 220-40):

Disaggregation of Income Statement Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted.

In November 2024, the FASB issued ASU 2024-03,

Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement

Expenses, requiring public entities to disclose additional information about specific expense categories in the notes to the financial

statements on an interim and annual basis.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim

periods beginning after December 15, 2027, with early adoption permitted.

The Company is currently evaluating the impact of this standard

on our disclosures.

In December 2025, the FASB issued ASU 2025-11, Interim

Reporting (Topic 270):

Narrow-Scope Improvements , which clarifies the guidance in Topic 270 to improve the consistency of interim

financial reporting.

The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring

entities to disclose events since the end of the last annual reporting period that have a material impact on the entity.

ASU 2025-11 is

effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption

The Company is currently evaluating the impact of adopting ASU 2025-11.

The Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements.

In December 2025, the FASB issued ASU No.

Codification Improvements.

The ASU addresses thirty-three items, representing the changes to the Codification that (1) clarify, (2) correct

errors, or (3) make minor improvements.

Generally, the amendments in this Update are not intended to result in significant changes for

most entities.

The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2026.

The adoption method of this ASU may vary, on an issue-by-issue basis.

Early adoption is permitted.

We are currently evaluating the provisions

of this ASU and do not expect this ASU to have a material impact on our consolidated financial statements.

The Company has considered all other recently

issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial

Recently adopted accounting pronouncement

In July 2025, the FASB issued ASU No.

Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets.

The amendments

in this update provide a practical expedient permitting an entity to assume that conditions at the balance sheet date remain unchanged

over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets.

update is effective for annual periods beginning after December 15, 2025, including interim periods within those fiscal years.

adopted ASU 2025-05, as of January 1, 2026, and applied the new disclosure requirements prospectively to the current annual period.

adoption of this ASU did not have an impact on our consolidated financial statements.

Note 3 – Inventory

As of September 30, 2025 and December 31, 2024, inventory consisted of the following:

September 30,

As of March 31, 2026 and December 31, 2025, inventory

consisted of the following:

Schedule of inventory

Finished goods

Raw materials

The Company did not impair any inventories as unsalable for the three and nine months ended September 30, 2025 and 2024.

The Company did no t write-off any inventories

as unsalable for the three months ended March 31, 2026 and 2025.

Note 4 – Prepaid expenses

As of March 31, 2026 and December 31, 2025, prepaid

expenses consisted of the following:

Schedule of prepaid expenses

Research and development expense

Advertising and marketing

Other prepaid operating expenses

Deposit on purchase of inventories

Prepaid expenses

Note 5 – Equipment, net

As of September 30, 2025 and December 31, 2024, equipment consisted of the following:

September 30,

As of March 31, 2026 and December 31, 2025, equipment

consisted of the following:

Schedule of property plant and equipment

Equipment gross

accumulated depreciation

Equipment, net

During the nine months ended September 30, 2025, the Company purchased vehicles and equipment for $ 608,495 , of which $ 291,528 was purchased with a financing loan and transferred vehicles from inventory of $ 95,297 due to a change of use.

For the three and nine months ended September 30, 2025 and 2024, depreciation consists of:

Three Months Ended

Nine months ended

September 30,

During the three months ended March 31, 2026 and

2025, the Company recorded depreciation of $ 30,219 and $ 12,556 , respectively.

During the three months ended March 31, 2026,

the Company purchased equipment for $ 10,727 .

During the three months ended March 31, 2025, the Company purchased vehicles and equipment

for $ 145,764 , of which $ 118,776 were purchased with a financing loan, and transferred vehicles from inventory of $ 74,827 due

to a change of use in 2025.

Financing loan

The Company had a financing loan for the purchase of vehicle for the year ended December 31, 2024.

The loan repayment is $1,898 per month for the first 36 months and then $2,590 per month for 30 months with an interest rate of $11.54% .

For the nine months ended September 30, 2025, the Company repaid $ 101,478 , of which $ 4,629 is for interest.

In March 2025, the Company fully paid this financing loan.

The Company had a financing loan for the purchase of vehicle in January 2025.

A repayment of loan schedule was $1,977 per month for the 72 months with an interest rate of $10.84% .

For the nine months ended September 30, 2025, the Company repaid $ 104,732 , of which $ 955 is for interest.

In March 2025, the Company fully paid this financing loan.

The Company had a financing loan for the purchase of vehicle in September 2025.

A repayment of loan schedule is $2,021 per month for 60 months, beginning October 2025, with an interest rate of 11.33% .

The Company had a financing loan for the purchase of vehicle in September 2025.

A repayment of loan schedule is $2,083 per month for 48 months, beginning October 2025, with an interest rate of 11.90% .

Note 5 – Intangible Assets, net

In 2022, the Company acquired the intellectual property of MFB California, 19 patents centered around its MFB Technology for the prevention and spread of wildfires.

MFB California currently holds 31 granted patents and 56 pending patent applications.

The Company had a financing loan for the purchase

of vehicle in September 2025.

The loan repayment is $ 2,021 per month for 60 months , beginning October 2025, with an interest

rate of 11.33 %.

The Company had a financing loan for the purchase

of vehicle in September 2025.

The loan repayment is $ 2,083 per month for 48 months , beginning October 2025, with an interest

rate of 11.90 %.

During the three months ended March 31, 2026 and

2025, the Company recorded interest expense of $ 4,427 and $ 5,584 , and repaid $ 7,884 and $ 215,625 , of which $ 4,427 and $ 5,584

are for interest, respectively.

As of March 31, 2026 and December 31, 2025, the Company had a financing loan of $ 155,497 and $ 163,381 ,

respectively.

Note 6 – Intangible Assets,

In 2022, the Company acquired the intellectual

property of Mighty Fire Breaker LLC (“MFB California”), 19 patents centered around its MFB Technology for the prevention and

spread of wildfires.

The granted patents include MFB California’s main chemistry and applications.

MFB California has 21 trademarks and various copyrights.

MFB California had 21 trademarks

and various copyrights.

Internally generated patents, trademarks and copyrights, are expensed as incurred.

As of September 30, 2025 and December 31, 2024, finite lived intangible assets consisted of the following:

September 30,

In December 2025, the Company entered into

an Intellectual Property Purchase Agreement to protect our existing patents.

The purchase price is $ 100,000 in

cash and 220,000 shares

of Common stock valued at $ 1,775,400 ,

which shall be issued within 30 days of the closing date.

The common stock was issued in January 2026.

As of March 31, 2026 and December 31, 2025, finite

lived intangible assets consisted of the following:

Schedule of finite lived intangible assets

Acquired patents (19)

Patent and technology assets

Non-compete agreements

Accumulated amortization

Intangible assets, net

Estimated future amortization expense for finite lived intangibles are as follows:

2025 remaining

As of September 30, 2025, the weighted-average useful life is 14.38 years.

During the three and nine months ended September 30, 2025 and 2024, amortization expense is as follows:

Three Months Ended

Nine months ended

September 30,

Estimated future amortization expense for finite

lived intangibles are as follows:

Schedule of estimated future amortization expense

Year ending December 31,

2026 (remaining nine months)

Intangible assets, net

As of March 31, 2026, the weighted-average useful

life is 13.84 years.

During the three months ended March 31, 2026 and

2025, the amortization expense was $ 95,465 and $ 61,983 , respectively.

Note 7 – Lease

In March 2022, the Company entered into an operating lease for a warehouse, with a term of eighteen (18) months.

In July 2023, the Company amended the contract and extended the lease term to July 2025.

In May 2025, the Company terminated this lease and wrote off of right-of use asset and lease liability.

In January 2025, the Company entered into an operating lease for our office and warehouse.

The commencement date is April 1, 2025, and the termination date is March 31, 2030.

The Company records a security deposit of $ 36,991 .

Short-term lease

The Company has some rental equipment with a month-to-month contract and leases mobile office space, used in our warehouse location, which is under a one year lease agreement and expires July 28, 2026.

For the three and nine months ended September 30, 2025 and 2024, right-of-use asset and lease information about the Company’s operating lease consist of:

In March 2022, the Company entered into an operating

lease for a warehouse, with a term of eighteen (18) months.

In July 2023, the Company amended the contract and extended the lease term

to July 2025.

In May 2025, the Company terminated this lease and wrote off the right-of-use asset and lease liability.

In January 2025, the Company entered into an operating

lease for our office and warehouse.

The commencement date was April 1, 2025, and the termination date is March 31, 2030.

The Company recorded

a security deposit of $ 36,991 .

For the three months ended March 31, 2026 and

2025, right-of-use asset and lease information about the Company’s operating lease consists of:

Schedule of right-of-use asset and lease information

Three months ended

Nine months ended

September 30,

The components of lease expense were as follows:

3 unchanged sentences

Total lease cost

Supplemental cash flow information related to leases was as follows:

Nine months ended

September 30,

Supplemental cash flow information related to

leases was as follows:

Schedule of supplemental cash flow information related to leases

Three months ended

Cash paid for operating cash flows from operating leases

Right-of-use asset obtained in exchange for new operating lease liabilities

Weighted-average remaining lease term - operating leases (year)

Weighted-average discount rate — operating leases

The following table outlines maturities of our lease liabilities as of September 30, 2025:

The following table outlines maturities of our

lease liabilities as of March 31, 2026:

Schedule of maturities of lease liabilities

Year ending December 31,

2025 - remaining three months

2026 (remaining nine months)

Operating leases, future minimum payments due

Imputed interest

1 unchanged sentence

Note 8 – Convertible Notes

The components of convertible notes as of September 30, 2025 and December 31, 2024, were as follows:

September 30,

July 15, 2024

July 15, 2025

August 15, 2024

August 15, 2025

November 15, 2024

November 15, 2025

December 15, 2024

December 15, 2025

February 7, 2025

February 7, 2026

The components of convertible notes as of March

31, 2026 and December 31, 2025, were as follows:

Schedule of components of convertible notes

Maturity date

February 15, 2025

2 unchanged sentences

Unamortized debt discount

( 1,099,923 )

Current portion

Long-term portion

On July 15, 2024 and August 15, 2024, the Company entered into seventeen (17) convertible notes ($ 1,121,000 ) and warrants ( 233,550 shares of common stock).

The convertible notes have 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 $ 3.00 per share.

The outstanding principal amount of convertible notes and unpaid interest is convertible at conversion price of the lesser of (i) $2.40 or (ii) a 30% discount to the price of shares issued in connection with a qualified financing.

In November and December, the Company entered into three (3) convertible notes ($ 175,000 ) and warrants ( 36,460 shares of common stock).

The Company paid 8% financing fee of $ 89,680 , accrued fee of $ 14,000 and recorded financing fee as debt discount.

In February 2025, the Company entered into eleven (11) convertible notes ($ 2,075,000 ) and warrants ( 432,296 shares of common stock).

The convertible notes have 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 $ 3.00 per share.

The Company paid 8% financing fee of $ 166,000 recorded financing fee as debt discount.

During the nine months ended September 30, 2025, the Company recognized the debt discount of $ 2,075,000 (Original Issued Discounts of discount of $ 166,000 , warrants of $882,000 and derivative liability of $ 1,027,000 ).

In June 2025, seventeen (17) note holders converted convertible notes issued in July and August 2024 of $ 1,121,000 and accrued interest of $ 97,353 into 507,661 shares of common stock.

As a result, the Company settled convertible notes, accrued interest, debt discount of $ 381,522 , and derivative liability of $ 2,127,000 , and recorded loss on settlement of debt of $ 2,640,611 .

On August 19, 2025, the Company withdrew its registration statement and decided not to proceed with qualified offering.

The Company determined that the bifurcated conversion feature was no longer a liability and is now categorized as equity.

As a result, the Company reclassified its derivative liability of $ 1,604,000 to additional paid-in capital.

In July and September 2025, six (6) note holders converted convertible notes issued in November and December 2024 and February 2025 of $1,850,000 and accrued interest of $114,897 into 818,709 shares of common stock.

As a result, the Company settled convertible notes, accrued interest, debt discount of $1,324,787, and derivative liability of $354,000, and recorded loss on settlement of debt of $4,130,203 .

During the nine months ended September 30, 2025 and 2024, the Company recognized interest expense of $ 186,405 and $ 21,014 and amortization of debt discount of $ 1,131,734 and $ 72,996 , respectively.

During the three months ended September 30, 2025 and 2024, the Company recognized interest expense of $ 49,473 and $ 20,879 and amortization of debt discount of $ 310,740 and $ 72,996 , respectively.

As of September 30, 2025 and December 31, 2024, the Company recorded accrued interest of $ 24,878 and $ 50,723 , respectively.

The Company determined that the conversion feature met the definition of a liability in accordance with ASC Topic No.

815-40, Derivatives and Hedging - Contracts in Entity's Own Stock and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for it as a derivative liability.

The fair value of the conversion feature was recorded as a debt discount and “day 1” derivative loss for the excess amount of debt discount and amortized to interest expense over the term of the note.

Note 8 – Derivative Liability

Fair Value Assumptions Used in Accounting for Derivative Liabilities

ASC 815 requires us to assess the fair market value of derivative liabilities at the end of each reporting period and recognize any change in the fair market value as other income or expense.

The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Binomial Lattice model to calculate the fair value as of September 30, 2025 and December 31, 2024.

For the nine months ended September 30, 2025 and the year ended December 31, 2024, the estimated fair values of the liabilities measured on a recurring basis, used the following significant assumptions:

September 30,

Expected term

0.13 - 1 year

Risk-free interest rate

Stock price at valuation date

$ 5.34 - 11.7

Expected average volatility

Expected dividend yield

The following table summarizes the changes in the derivative liabilities during the nine months ended September 30, 2025:

Fair Value Measurements Using Significant Observable Inputs (Level 3)

Balance - December 31, 2024

Addition of new derivatives recognized as debt discounts

Settled on issuance of common stock

( 2,481,000 )

Reclassification to additional paid in capital

( 1,604,000 )

Loss on fair value of derivative liability

Balance - September 30, 2025

Note 9 – Accounts payable and accrued liabilities

As of September 30, 2025 and December 31, 2024, accounts payable and accrued liabilities consisted of the following:

September 30,

During the three months ended March 31, 2026 and

2025, the Company recognized interest expense of $ 4,726 and $ 60,258 and amortization of debt discount of $ 155,679 and $ 345,828 ,

respectively.

As of March 31, 2026 and December 31, 2025, the Company recorded accrued interest of $ 0 and $ 32,773 , respectively.

In February 2026, seven (7) note holders

converted convertible notes issued in February 2025 of $ 375,000 and

accrued interest of $ 37,500 into 171,878 shares

of common stock with a conversion price of $2.40.

As a result, the Company settled convertible notes and accrued interest of $ 412,500 ,

and recorded loss on settlement of debt of $ 847,366 .

Note 9 – Accounts payable and accrued

As of March 31, 2026 and December 31, 2025, accounts

payable and accrued liabilities consisted of the following:

Schedule of accounts payable and accrued liabilities

Accounts payable

3 unchanged sentences

Payroll liability

Accounts payable and accrued liabilities

Note 10 – Related Party Transactions

The related parties that had material transactions for the nine months ended September 30, 2025 and 2024, consist of the following:

The related parties that had material transactions

for the three months ended March 31, 2026 and 2025, consist of the following:

Related Party

Nature of Relationship to the Company

An Ohio limited liability company - a significant shareholder

Owner of A and our former Chief Executive Officer of the Company from April 1, 2025 to October 1, 2025.

Current Chairman of the Board of Directors.

Chief Executive Officer of the Company until March 31, 2025 and Vice President of Operations from April 1, 2025.

A California limited liability company owned by a related party E

Significant shareholder and our Chief Technology Officer

An Ohio Corporation - a significant shareholder

Owner of A and our Chairman of the Board

A California Corporation owned by a related party D

shareholder and our Chief Technology Officer through March 31, 2026

Director and Chief Executive Officer of GEVI Insurance Holdings Inc.

A Delaware limited liability company – Series A Preferred shareholder

limited liability company controlled by a Director and significant shareholder

A company controlled by our Chief Financial Officer

For the nine months ended September 30, 2025 and 2024, expenses to related parties and their nature consists of:

Nine Months Ended

September 30,

As of March 31, 2026 and December 31, 2025, amounts

owing to related parties consists as follows:

Schedule of expenses to related parties and their nature

Related Party

Nature of transaction

Operating expenses paid on behalf of the Company

Accrued interest related to convertible note related party

For the three months ended March 31, 2026 and

2025, expenses to related parties and their nature consists of:

Three months ended March 31,

Related Party

Nature of transaction

Financial Statement Line Item

1 unchanged sentence

Professional fees - related party

Payment operating expenses on behalf of the Company

Due to related party

Repayment loan

Due to related party

Cash paid for consulting fees

2 unchanged sentences

Cost of revenue - related party

Cash paid for management fee

Professional fees - related party

Cash paid for royalty and sales commissions

2 unchanged sentences

Management compensation

20,000 shares of Series C preferred stock for advisory fee

Professional fees - related party

69,007 Series C preferred stock for services

Financing expense

Edgar filing expense

General and administrative

Professional service - accounting

Professional fees - related party

For the three months ended September 30, 2025 and 2024, expenses to related parties and their nature consists of:

Three Months Ended

September 30,

Related Party

Nature of transaction

Financial Statement Line Item

Cash paid for consulting fees

Professional fees - related party

Cash paid for consulting and advisory fees

Cost of revenue - related party

Cash paid for management fee

Professional fees - related party

Cash paid for royalty and sales commissions

Cost of revenue - related party

Edgar filing expense

General and administrative

Professional service -accounting

Professional fees - related party

Convertible notes – related parties

The components of convertible notes as of September 30, 2025 and December 31, 2024, were as follows:

September 30,

December 1, 2024

December 31, 2025

February 2025

Contributed Capital

In February 2026, the Company received payments

from related party B, totaling $ 96,258 related to disgorgement of short-swing profits under Section 16(b) of the Securities Exchange Act

of 1934, as amended.

The Company recognized these proceeds as a capital contribution and the amounts were recorded as an increase to additional

paid-in capital on the unaudited interim consolidated balance sheets.

Convertible note – related party

The components of convertible notes as of March

31, 2026 and December 31, 2025, were as follows:

Schedule of convertible debt related party

Maturity date

February 2025

April 28, 2026

Total Convertible notes

2 unchanged sentences

( 2,211,484 )

( 1,285,400 )

Long-term portion

On December 31, 2024, the Company issued a convertible note of $ 576,693 , to related party A, in exchange for the amount due to related party.

The convertible note has a term of twelve ( 12 ) months, at an interest rate of 10 % per annum.

The outstanding principal amount of convertible note and unpaid interest is convertible at a fixed conversion price of $ 2.16 .

The conversion price is a fixed price and the Company determined that conversion feature did not need to be bifurcated.

The Company has accounting for the convertible debt at amortized cost under ASC 470-20.

In February 2025, the Company entered into one (1) subscription agreement for convertible notes ($ 2,000,000 ) and warrants ( 416,667 shares of common stock) with a related party G.

The convertible notes have 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 $ 3.00 per share.

The outstanding principal amount of convertible notes and unpaid interest is convertible at a fixed conversion price of $ 2.40 .

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.

In February 2025, the Company entered into one

(1) subscription agreement for convertible note ($ 2,000,000 ) and warrants (416,667 shares of common stock) with related party F.

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 $3.00 per share.

The outstanding principal amount of convertible note and unpaid interest is convertible

at a fixed conversion price of $2.40.

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 F could proceed against the equity of MFB Ohio pledged to collateralize

the convertible note.

MFB Ohio owns the Company’s intellectual property portfolio.

The Company paid 8% original discount of $ 160,000 and financing fee of $ 63,918 and recorded these financing costs as debt discount.

The Company has accounted for the convertible debt at amortized cost under ASC 470-20.

During the nine months ended September 30, 2025, the Company recognized the debt discount of $ 1,824,087 (Original Issued Discounts of discount and financing fee of $ 223,918 and warrants of $ 1,600,169 ).

During the three and nine months ended September 30, 2025, the Company recognized interest expenses of $ 64,946 and $ 160,393 and amortization of debt discount of $ 915,548 and $ 1,094,944 , respectively.

As of September 30, 2025, the Company recorded accrued interest of $ 160,393 .

On February 27, 2026, related party F extended

their convertible promissory note until April 28, 2026.

Pursuant to the extension, they charged a 1% amendment fee and agreed to release

their security pledge against certain intangible assets of the Company.

As a result, the principal amount became $ 2,222,000 , including

accrued interest of $ 200,000 and 1% fee of $ 22,000 .

The Company evaluated the modification of terms

under ASC 470-50, “Debt - Modification and Extinguishment”, and concluded that the extension of the maturity dates did not

result in a substantial change and consequential changes to the economic substance of the debt and thus resulted in a modification of

the debt and not extinguishment of the debt.

Accordingly, no gain or loss on debt extinguishment was recorded.

During the three months ended March 31, 2026 and

2025, the Company recognized interest expenses of $ 51,201 and $ 31,206 and amortization of debt discount of $ 726,084 and

$ 30,850 , respectively.

As of March 31, 2026 and December 31, 2025, the Company recorded accrued interest of $ 18,872 and $ 167,671 , respectively.

The note and accrued interest were fully converted

into common shares in April 2026 (Note 13).

Note 11 – Stockholders’ Equity

Amended Articles of Incorporation

Effective on March 17, 2025, the Company amended its Articles of Incorporation to increase the authorized shares to 1,030,000,000 shares, of which 1,000,000,000 shares are common stock and 30,000,000 shares are preferred stock .

Preferred Shares

Preferred Stock

Shares Outstanding

The Company is authorized to issue up to 30,000,000 shares of Preferred Stock, par value $ 0.0001 per share.

The Company is authorized to issue up to 30,000,000 shares

of Preferred Stock, par value $ 0.0001 per share.

Series A Preferred Stock

The Company originally designated 10,000,000 shares of its Preferred Stock as Series A Convertible Preferred Stock.

On March 17, 2025, the Company amended and restated its Series A Convertible Preferred Stock to designate 10,000,000 shares of its Preferred Stock as Series A Preferred Stock, par value $0.0001, with the following rights and privileges .

Holders of shares of Series A Preferred Stock are not entitled to receive dividends.

The Company designated 10,000,000 shares

of its Preferred Stock as Series A Preferred Stock, par value $ 0.0001 , with the following rights and privileges.

Holders of shares of

Series A Preferred Stock are not entitled to receive dividends.

Voting Rights .

Each share of Series A Preferred Stock is entitled to 1,000 votes on all matters submitted to a vote of the holders of Common Stock, voting together with the holders of Common Stock as a single class.

Each share of Series

A Preferred Stock is entitled to 1,000 votes on all matters submitted to a vote of the holders of Common Stock, voting together

with the holders of Common Stock as a single class.

Holders of shares of Series A Preferred Stock do not have cumulative voting rights.

This means a holder of a single share of Series A Preferred Stock cannot cast more than one vote for each position to be filled on the Board of Directors.

This means a holder of a single share of Series A Preferred Stock cannot cast more than one vote for each position to be filled on the

Board of Directors.

Other Rights .

Shares of Series A Preferred Stock are not entitled to a liquidation preference.

The holders of the Series A Preferred Stock may not be redeemed without the consent of the holders of the Series A Preferred Stock.

The holder of the Series A Preferred Stock are not entitled to pre-emptive rights or subscription rights.

As of September 30, 2025 and December 31, 2024, there were 1,666,667 shares of Series A Preferred stock issued and outstanding.

Shares of Series A

Preferred Stock are not entitled to a liquidation preference.

The holders of the Series A Preferred Stock may not be redeemed without

the consent of the holders of the Series A Preferred Stock.

The holders of the Series A Preferred Stock are not entitled to pre-emptive

rights or subscription rights.

As of March 31, 2026 and December 31, 2025, there

were 1,666,667 shares of Series A Preferred stock issued and outstanding.

Series C Convertible Preferred Stock

The Company has designated 10,000,000 shares of its Preferred Stock as Series C Convertible Preferred Stock with the following rights and privileges.

Holders of shares of Series C Convertible Preferred Stock are not entitled to receive dividends.

The Company has designated 10,000,000 shares

of its Preferred Stock as Series C Convertible Preferred Stock with the following rights and privileges.

Holders of shares of

Series C Convertible Preferred Stock are not entitled to receive dividends.

Voting Rights .

The holders of the Series C Convertible Preferred Stock are not entitled to vote.

The holders of the

Series C Convertible Preferred Stock are not entitled to vote.

Conversion Rights .

Each share of Series C Convertible Preferred Stock outstanding as such time shall be convertible, at the option of the holder thereof, at any time and from time to time, and without the payment of additional consideration by the holder thereof, into 3 .3333 shares of the Common Stock of the Company (the “Conversion Ratio”).

Such Conversion Ratio, and the rate at which shares of Series C Convertible Preferred Stock may be converted into shares of Common Stock, shall be subject to adjustment.

Each share of

Series C Convertible Preferred Stock outstanding shall be convertible, at the option of the holder thereof, at any time and

from time to time, and without the payment of additional consideration by the holder thereof, into 3.3333 shares of the Common

Stock of the Company (the “Conversion Ratio”).

Such Conversion Ratio, and the rate at which shares of Series C Convertible

Preferred Stock may be converted into shares of Common Stock, shall be subject to adjustment.

Other Rights .

The holders of the Series C Convertible Preferred Stock are not entitled to a liquidation preference.

The holders of the Series C Convertible Preferred Stock may not be redeemed without the consent of the holders of the Series C Convertible Preferred Stock.

The holder of the Series C Convertible Preferred Stock are not entitled to pre-emptive rights or subscription rights.

In September 2025, the Company entered into Securities Purchase Agreements with certain investors for the issuance and sale (the “PIPE Offering”) of (i) 420,943 shares of its Series C Convertible Preferred Stock for an aggregate purchase price of approximately $5.4 million, net of proceeds and (ii) warrants (the “PIPE Warrants”) to purchase up to 701,563 shares of Common Stock at an offering price of $15.00 per share of Series C Preferred Stock and accompanying PIPE Warrant.

The PIPE Warrants are exercisable immediately upon issuance at an exercise price of $6.00 per share and will expire five years from the date of issuance .

In addition, during the nine months ended September 30, 2025, the Company issued 355,257 shares of Series C Preferred Stock as follows:

The holders of the

Series C Convertible Preferred Stock are not entitled to a liquidation preference.

The holders of the Series C Convertible Preferred Stock

may not be redeemed without the consent of the holders of the Series C Convertible Preferred Stock.

The holders of the Series C Convertible

Preferred Stock are not entitled to pre-emptive rights or subscription rights.

During the three months ended March 31, 2025,

the Company issued 225,000 shares of Series C Convertible Preferred Stock as follows:

· 27,500 shares for purchase subscriptions of $ 260,000 , at prices of $4.00 or $6.00 per share

· 167,500 shares for services, valued at $ 2,349,020 at market price on issuance dates.

86,250 shares for compensation, valued at $ 1,638,629 at market price on issuance dates.

During the nine months ended September 2025, the holders of the Series C Convertible Preferred Stock converted 3,014,469 shares of the Company’s Series C Convertible Preferred Stock into 10,048,252 shares of the Company’s common stock.

As of September 30, 2025 and December 31, 2024, there were 763,700 and 3,001,969 shares of the Company’s Series C Convertible Preferred Stock issued and outstanding, respectively.

The holders of shares of our Common Stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders.

The holders of Common Stock are entitled to equal dividends and distributions, with respect to the Common Stock when, as, and if declared by the Board of Directors from funds legally available for such dividends.

No holder of Common Stock has any preemptive right to subscribe for any of our stock nor are any shares subject to redemption.

Upon our liquidation, dissolution, or winding up, and after payment of creditors and any amounts payable to senior securities, the assets will be divided pro rata on a share-for-share basis among the holders of the shares of Common Stock.

No holder of shares of Common Stock of the Company shall be entitled as of right to purchase or subscribe for any part of any unissued stock of the Company or of any new or additional authorized stock of the Company of any class whatsoever, or any issue of securities of the Company convertible into stock, whether such stock or securities be issued for money or consideration other than money or by way of dividend, but any such unissued stock or such new or additional authorized stock or such securities convertible into stock may be issued and disposed of to such persons, firms, corporations and associations, and upon such terms as may be deemed advisable by the Board of Directors without offering to stockholders then of record or any class of stockholders any thereof upon the same terms or upon any terms.

During the nine months ended September 30, 2025, the Company issued 11,562,648 shares of common stock as follows:

10,048,252 shares for conversion of Series C Preferred Stock.

· 30,000 shares

for compensation, valued at $ 420,720 at market price on issuance dates.

As of March 31, 2026 and December 31, 2025, there

were 807,668 shares of the Company’s Series C Convertible Preferred Stock issued and outstanding.

The Company has authorized 1,000,000,000 shares

of common stock with a par value of $ 0.0001 .

Each share of common stock entitles the holder to one vote, in person or proxy, on any matter

on which action of the stockholders of the corporation is sought.

During the three months ended March 31, 2026,

the Company issued 594,586 shares of Common Stock as follows:

· 171,878 shares for conversion of debt of $ 1,259,866

37,667 shares for services, valued at $ 234,640 .

150,000 shares for management compensation.

359 shares for reverse stock split adjustment.

As of September 30, 2025 and December 31, 2024, there were 17,702,912 and 6,140,264 shares of the Company’s common stock issued, respectively.

Restricted stock award

On June 27, 2025 (the “Effective Date”), the Company entered into the employment agreement with our Chief Operating Officer (“COO”), commencing on July 21, 2025.

Under this agreement, the Company issued 150,000 restricted shares of the Common Stock as stock bonus.

Shares shall vest one-fourth each anniversary of the Effective Date.

· 22,000 shares for service, valued at $ 160,380

· 180,708 shares for cashless exercise of warrants

· 220,000 shares for stock payable for acquisition

of IP, valued at $ 1,775,400 , which was recorded as additional paid in capital as of December 31, 2025.

During the three months ended March 31, 2025,

the Company issued 15,536,620 shares of Common Stock for conversion of Series C Preferred Stock.

As of March 31, 2026 and December 31, 2025, there

were 19,116,901 and 18,522,315 shares of the Company’s common stock issued and outstanding, respectively.

Restricted stock

On June 27, 2025 (the “Effective Date”),

the Company entered into the employment agreement with our Chief Operating Officer (“COO”), commencing on July 21, 2025.

this agreement, the Company issued 150,000 restricted shares of the Common Stock as stock bonus.

Shares shall vest one-fourth

each anniversary of the Effective Date.

The grant date fair value of shares is $ 1,799,970 .

During the three and nine months ended September 30, 2025, the Company recorded compensation expense of $ 112,498 .

As of September 30, 2025, unrecognized compensation cost for unvested equity awards was $ 1,687,472 .

On September 22, 2025, the Company entered into the employment agreement with our new Chief Executive Officer (“CEO”), commencing on October 1, 2025 (the “Effective Date”).

On September 22, 2025, the Company entered into

the employment agreement with our new Chief Executive Officer (“CEO”), commencing on October 1, 2025 (the “Effective

Under this agreement, the Company issued 300,000 restricted shares of the Common Stock as stock bonus.

Shares shall vest one-fourth on first anniversary of the Effective Date and the remaining three-fourths on monthly basis over the following 36 months.

shall vest one-fourth on first anniversary of the Effective Date and the remaining three-fourths on monthly basis over the following 36

The grant date fair value of shares is $ 1,698,000 .

As of September 30, 2025, unrecognized compensation cost for unvested equity awards was $ 509,400 .

During the year ended December 31, 2025, the Company

recorded compensation expense of $ 331,120 .

As of December 31, 2025, unrecognized compensation cost for unvested equity awards was $ 3,166,850 .

Management stock compensation (PSU)

During 2025, the Company entered into employment and consulting agreements with our CEO, COO and Consultant.

The stock compensation based on market capitalization condition is as follows:

Market capitalization

consecutive days

During 2025, the Company entered into employment

and consulting agreements with our CEO, former CEO, COO and a Director.

The stock compensation based on market capitalization condition

is as follows:

capitalization

30 consecutive

Consulting agreement

CEO resigned on

October 1, 2025

CEO and current

Consulting agreement

Employment agreement

$ 120,000,000

70,000 series C preferred stock

$ 150,000,000

70,000 series C preferred stock

37,500 common stock

$ 200,000,000

70,000 series C preferred stock

37,500 common stock

$ 250,000,000

70,000 series C preferred stock

37,500 common stock

$ 300,000,000

37,500 common stock

Fair value ($)

The Company used the Monte Carlo model to calculate the fair value of compensation and estimated a total of the grant date fair value of $ 6,837,000 .

The Company records compensation expense over the term of a derived service period unless the condition is satisfied at an earlier date.

During the three and nine months ended September 30, 2025, the Company recorded compensation expense of $ 1,579,965 and $ 2,347,634 , respectively.

As of September 30, 2025, unrecognized compensation cost for unvested equity awards was $ 4,489,366 , which is expected to be recognized over a remaining weighted-average period of 0.41 years.

For the nine months ended September 30, 2025, the estimated fair values of the compensation measured used the following significant assumptions:

agreement COO

agreement CEO

Series C Convertible Preferred Stock

70,000 Series

C Convertible Preferred Stock

70,000 Series

C Convertible Preferred Stock

37,500 common

75,000 common

70,000 Series

C Convertible Preferred Stock

70,000 Series

C Convertible Preferred Stock

37,500 common

75,000 common

70,000 Series

C Convertible Preferred Stock

70,000 Series

C Convertible Preferred Stock

37,500 common

75,000 common

37,500 common

75,000 common

upon completion of Initial Term;

awards survive termination

upon completion of Initial Term;

awards survive termination

if terminated for cause or resignation

The Company used the Monte Carlo model to

calculate the fair value of compensation and estimated a total of the grant date fair value of $ 8,417,000 .

The Company records compensation expense over the term of a derived service period unless the condition is satisfied at an earlier

During the three months ended March 31, 2026, the Company recorded compensation expense of $ 2,116,178 .

As of March 31, 2026, unrecognized compensation cost for unvested equity awards was $ 710,043 ,

which is expected to be recognized over a remaining weighted-average period of 0.34 years.

As of March 31, 2026, the $120,000,000 market capitalization condition had been achieved , but the

140,000 shares of Series C Convertible Preferred Stock, that become issuable upon achievement of that condition,

have not yet been issued.

For the year ended December 31, 2025, the estimated

fair values of the compensation measured used the following significant assumptions:

Significant assumptions used for valuation of compensation

Derived service period

1 unchanged sentence

Risk-free interest rate

3.62% - 3.97%

Stock price at valuation date

1 unchanged sentence

108.5% - 151.0%

First Capitalization Thresholder per share price

Second Capitalization Thresholder per share price

Third Capitalization Thresholder per share price

First Capitalization Threshold per share price

Second Capitalization Threshold per share price

Third Capitalization Threshold per share price

11.42 - 23.82

Fourth Capitalization Thresholder per share price

Fourth Capitalization Threshold per share price

14.27 - 28.56

The Company issued a total of 701,562 warrants for a period of five years at an exercise price per share of $ 6.00 in connection with Series C Preferred Stock under PIPE for the nine months ended September 30, 2025.

The Company recorded the warrants value of $ 2,090,674 to additional paid-in capital.

In addition, the Company issued 105,233 placement agent warrants for a period of five years at an exercise price per share of $ 5.40 .

The Company recorded the warrants value of $ 613,992 to additional paid-in capital as offering expenses.

The Company issued a total of 848,963 warrants for a period of five years at an exercise price per share of $ 3.00 in connection with convertible notes for the nine months ended September 30, 2025.

The Company recorded the warrants value of $ 710,845 to additional paid-in capital.

The Company issued 666,668 warrants (“Univest Warrants”) for a period of five years at an exercise price per share of $ 0.06 for consulting services, for the nine months ended September 30, 2025.

Each 166,667 warrants are exercisable on September 7, 2025, March 7, 2026, September 7, 2026 and March 7, 2027.

The Company recorded a financing expense of $ 6,167,334 to additional paid-in capital.

The Company issued a total of 111,898 warrants (“Univest Warrants”) at an exercise price per share of $ 2.64 for financing expense of convertible notes issued in 2025 and 2024.

Warrants are exercisable on September 7, 2025, and are for a period of five years following the initial exercise date.

The Company recorded the warrants of $ 827,991 to additional paid-in capital.

The Company and Univest Securities, LLC have agreed that the Univest Warrants to purchase up to 778,566 shares of common stock, would be terminated in full and rendered null and void, and all past, current, or future obligations under the Univest Warrants shall be extinguished, and there shall be no surviving right, title or interest in or to the Univest Warrants or any shares purchasable thereunder.

The Company issued a total of 270,010 warrants for a period of five years at an exercise price per share of $ 3.00 in connection with convertible notes for the year ended December 31, 2024.

The Company recorded the warrants value of $ 1,654,178 to additional paid-in capital.

We evaluate all warrants issued to determine the appropriate classification under ASC 480 and ASC 815.

In addition to determining classification, we evaluate these instruments to determine if such instruments meet the definition of a derivative.

The classification of all outstanding warrants, including whether such instruments should be recorded as equity, is evaluated at the end of each reporting period.

The warrants were deemed to be equity instruments and were valued using a Black Scholes valuation model.

We evaluate all warrants issued to determine the

appropriate classification under ASC 480 and ASC 815.

In addition to determining classification, we evaluate these instruments to determine

if such instruments meet the definition of a derivative.

The classification of all outstanding warrants, including whether such instruments

should be recorded as equity, is evaluated at the end of each reporting period.

The warrants are valued using a Black Scholes

valuation model.

The use of this valuation model requires the input of highly subjective assumptions.

Any change to these inputs could produce significantly higher or lower fair value measurements.

The Company utilized the following assumptions:

September 30,

Expected term

Expected average volatility

Risk-free interest rate

3.82 % - 4.29

Expected dividend yield

A summary of activity of the warrants during the nine months ended September 30, 2025 as follows:

Any change to these inputs could

produce significantly higher or lower fair value measurements.

A summary of activity of the warrants during

the three months ended March 31, 2026 as follows:

Schedule of activity of the warrants

Warrants Outstanding

Weighted Average Remaining

Weighted Average

Average Exercise Price

Contractual life (in years)

Exercise Price

Contractual life

Outstanding, December 31, 2025

Outstanding, September 30, 2025

Exercisable, September 30, 2025

The intrinsic value of the warrants as of September 30, 2025 is $ 3,285,396 .

Note 12 – Disaggregated revenue and Concentration

During the three and nine months ended September 30, 2025 and 2024, disaggregated revenue was as follows:

Outstanding, March 31, 2026

Exercisable, March 31, 2026

The intrinsic value of the warrants as of March

31, 2026 is approximately $ 12.9

Note 12 – Disaggregated revenue

and Concentration

During the three months ended March 31, 2026

and 2025, disaggregated revenue was as follows:

Schedule of disaggregated revenue

Three months ended

Nine months ended

September 30,

Products sale

Product installation service

During the three and nine months ended September 30, 2025 and 2024, customer and supplier concentration (more than 10%) were as follows:

During the three months ended March 31, 2026

and 2025, customer and supplier concentrations (more than 10%) were as follows:

Revenue and accounts receivable

Recurring customers do not represent a material percentage of our revenue and accounts receivable for the three and nine months ended September 30, 2025 and 2024.

Recurring customers do not represent a material

percentage of our revenue and accounts receivable for the three months ended March 31, 2026 and 2025.

Schedule of revenue and accounts receivable

Three months ended

Nine months ended

September 30,

Number of customers (more than 10% revenue)

Total revenue of top 5 customers

September 30,

Total revenue of top five (5) customers

Number of customers (more than 10% of accounts receivable)

Total % of accounts receivable balance (more than 10%)

Purchases and accounts payable

Percentage of Purchases

Purchase and accounts payable

Schedule of purchase and accounts payable

Percentage of Purchases

1 unchanged sentence

For three months ended

For nine months ended

Accounts payable for purchase

September 30,

Total (as a group)

To reduce risk, the Company closely monitors the amounts due from its customers and assesses the financial strength of its customers through a variety of methods that include, but are not limited to, engaging directly with customer operations and leadership personnel, visiting customer locations to observe operating activities, and assessing customer longevity and reputation in the marketplace.

As a result, the Company believes that its accounts receivable credit risk exposure is limited.

To reduce risk, the Company closely monitors

the amounts due from its customers and assesses the financial strength of its customers through a variety of methods that include, but

are not limited to, engaging directly with customer operations and leadership personnel, visiting customer locations to observe operating

activities, and assessing customer longevity and reputation in the marketplace.

As a result, the Company believes that its accounts receivable

credit risk exposure is limited.

Note 13 – Subsequent Events

Management has evaluated subsequent events through November 12, 2025, which is the date these interim unaudited consolidated financial statements were available to be issued.

On October 15, 2025, by written consent of the majority voting stockholders in lieu of a special meeting, the Company amended and restated its bylaws and in connection therewith appointed two additional directors.

On October 21, 2025, the Company issued under a follow on to the PIPE offering:

(i) 193,968 shares of its Series C Convertible Preferred Stock for an aggregate purchase price of approximately $2.7 million, net of proceeds, and (ii) PIPE Warrants to purchase up to 323,276 shares of Common Stock at an offering price of $15.00 per share of Series C Preferred Stock and accompanying PIPE Warrant.

The PIPE Warrants are exercisable immediately upon issuance at an exercise price of $6.00 per share and will expire five years from the date of issuance.

In addition, the Company issued 48,491 placement agent warrants for a period of five years at an exercise price per share of $5.40 .

Management has evaluated subsequent events through

May 14, 2026, which is the date these financial statements were available to be issued.

Based on our evaluation, no material events have

occurred that require disclosure, except as follows:

The Company issued common stock as follows:

· 940,799 shares of common stock for conversion

of related party debt and accrued interest, valued at $2,257,917.

· 2,258,045 shares of common stock for conversion

of 677,409 shares of Series C Preferred Stock.

· 33,333 shares of common stock for services, valued

· 8,334 shares of common stock upon exercise of 8,334 warrants, for proceeds of $25,002.

The Company issued 46,250 warrants to a related

party F for services.

The Company and Hexion Inc., a New Jersey

corporation (“Hexion”), formed HexiTech LLC, a Delaware limited liability company (“HexiTech”), to facilitate

a joint venture to develop, manufacture, commercialize and sell products incorporating the Company’s fire-retardant intellectual

property within a defined field of use, utilizing Hexion’s manufacturing and commercialization capabilities.

On April 17, 2026,

the Company and Hexion entered into a limited liability company agreement governing HexiTech, pursuant to which the Company and Hexion

were admitted as 50% members of HexiTech.

On April 17, 2026, the Company also entered into an Intellectual Property License

Agreement with HexiTech pursuant to which the Company granted HexiTech a defined license to the Company’s fire-retardant intellectual

property within a defined field of use.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements