What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-19 compared with 2025-05-21 · 545 added, 407 removed, 696 unchanged (58% of the section changed)

12 unchanged sentences

Accrued expenses

Related party accrued rent

Related party liabilities

Share issuance liability

Deferred payables, current

Notes payable

Convertible note payable, current

Related party notes

Other current liabilities

Total current liabilities

Related party notes

Convertible note payable, net

9 unchanged sentences

Common Stock, $ 0.0001 par value, 551,000,000 shares authorized;

and 36,541,882 and 36,202,798 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

and 40,926,445 and 36,202,798 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

4 unchanged sentences

TOTAL STOCKHOLDERS’ DEFICIT

( 10,932,589 )

( 17,024,825 )

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT

2 unchanged sentences

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

Three Months Ended

Six Months Ended

Cost of goods sold

3 unchanged sentences

General and administrative, net

Transaction costs

Depreciation and amortization

3 unchanged sentences

( 6,837,497 )

( 10,671,116 )

( 12,399,461 )

Other income (expense):

3 unchanged sentences

Change in fair value of Earn-out Share Liability

( 1,730,000 )

Other expense

Interest expense

( 1,379,581 )

Total other income (expense)

Net income (loss)

( 2,489,915 )

Net income (loss) per share:

$ ( 7,410,858 )

( 7,278,070 )

( 3,111,806 )

( 13,297,064 )

Net loss per share:

Weighted-average common stock outstanding used in per share amounts:

1 unchanged sentence

Foreign currency translation adjustment

Comprehensive income (loss)

Comprehensive loss

$ ( 7,242,296 )

( 7,155,348 )

( 2,922,813 )

( 12,808,961 )

The accompanying notes are an integral part of

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

FOR THE THREE MONTHS ENDED MARCH 31, 2025

FOR THE THREE MONTHS ENDED JUNE 30, 2025

Comprehensive

Stockholders’

Income (Loss)

Balance, December 31, 2024

Balance, March 31, 2025

$ 201,697,085

3 unchanged sentences

Common stock issued upon exercise of stock options

Common stock issued upon vesting of RSUs

Common stock issued upon draw on the equity line of credit

Common stock issued as compensation for equity line of credit commitment fee

Common stock issued as consideration for Crowdkeep

Common stock issued for services

Settlement of convertible note agreement for shares issued

Cumulative translation adjustment

Balance, March 31, 2025

( 7,410,858 )

Balance, June 30, 2025

$ 209,682,257

FOR THE THREE MONTHS ENDED MARCH 31, 2024

$ ( 220,942,324 )

$ ( 10,932,589 )

FOR THE THREE MONTHS ENDED JUNE 30, 2024

Comprehensive

1 unchanged sentence

Income (Loss)

Balance, December 31, 2023

$ 159,475,010

$ ( 170,282,750 )

Balance, March 31, 2024

( 176,301,744 )

2 unchanged sentences

Conversion of vendor payable to Series A-2 Preferred Stock

Common stock issued upon exercise of stock options

Stock based compensation for stock options

2 unchanged sentences

( 7,278,070 )

Balance, March 31, 2024

Balance, June 30, 2024

$ 172,052,711

5 unchanged sentences

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

FOR THE SIX MONTHS ENDED JUNE 30, 2025

Comprehensive

Stockholders’

Income (Loss)

Balance, December 31, 2024

$ 200,667,682

$ ( 217,830,518 )

$ ( 17,024,824 )

Stock based compensation

Common stock issued upon exercise of stock options

Common stock issued upon vesting of RSUs

Common stock issued upon draw on the equity line of credit

Common stock issued as compensation for equity line of credit commitment fee

Common stock issued as consideration for Crowdkeep

Common stock issued for services

Settlement of convertible note agreement for shares issued

Cumulative translation adjustment

( 3,111,806 )

Balance, June 30, 2025

$ 209,682,257

$ ( 220,942,324 )

$ ( 10,932,589 )

FOR THE SIX MONTHS ENDED JUNE 30, 2024

Comprehensive

Stockholders’

Income (Loss)

Balance, December 31, 2023

( 170,282,750

Series A-2 Preferred Stock Issuances, net of transaction costs

Conversion of vendor payable to Series A-2 Preferred Stock

Common stock issued upon exercise of stock options

Stock based compensation for stock options

Foreign currency translation (loss)

Balance, June 30, 2024

( 183,579,814

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

Cash flows from operating activities

Net income (loss)

$ ( 6,547,412 )

Adjustments to reconcile net income (loss) to net cash used for operating activities:

Adjustments to reconcile net loss to net cash used for operating activities:

Depreciation and amortization

Amortization of debt issuance costs

Impairment loss on investment

Change in fair value of convertible note option liability

1 unchanged sentence

Change in fair value of Earn-out Share Liability

( 10,530,000 )

Common stock issued as compensation for ELOC commitment fee

Share based vendor payments

Share based compensation

Unrealized foreign currency transaction loss

Unrealized foreign currency transaction (gain) loss

Amortization of operating lease right of use assets

1 unchanged sentence

Prepaid and other current assets

( 4,904,725 )

Accounts payable

4 unchanged sentences

Net cash used in operating activities

( 3,698,741 )

( 10,694,695 )

Cash flows from investing activities

5 unchanged sentences

Proceeds from related party notes

Proceeds from issuance of convertible notes

Proceeds from the issuance of shares under equity line of credit facility

Proceeds from the issuance of Series A-2 preferred stock, net of transaction costs

Proceeds from prepaid investor subscriptions

Proceeds from exercise of stock options

2 unchanged sentences

Net decrease in cash and cash equivalents

( 1,438,292 )

Cash and cash equivalents at beginning of year

1 unchanged sentence

Non-cash activities

Crowdkeep asset acquisition

Settlement of convertible notes for shares issued

Issuance on Series A-2 preferred stock in exchange for Investor Deposits

Conversion of vendor payable to Series A-2 Preferred Shares

The accompanying notes are an integral part of these unaudited condensed

consolidated financial statements.

Supplemental cash flow information

Interest paid

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

and Subsidiaries

1 unchanged sentence

1 - DESCRIPTION OF BUSINESS

The Company is a provider of edge

computing and communications devices (i.e., “VeeaHub Ò ” devices), applications,

and services hosted on its edge Platform-as-a-Service (“ePaaS”).

Veea Edge Platform ePaaS is an end-to-end platform that

is both locally- and cloud-managed.

VeeaHub Ò products are converged computing and communications

(i.e., hyperconverged) indoor and outdoor devices, about the size of a Wi-Fi Access Point (AP), that provide for networking and computing

solutions for AI-assisted applications and solutions at the edge where people, places, and things connect to the network.

Veea Edge Platform Ô

provides for highly secure connectivity, computing, and IoT solutions through full stack platform for digital transformation of industries,

as well as unserved or underserved communities that lack Internet connectivity and essential applications and services.

It further enables

the formation of highly secure, but easily accessible, private clouds and networks across one or multiple user(s) or enterprise location(s)

across the globe.

We have redefined and simplified edge computing and connectivity with Veea Edge Platform Ô ,

easily deployable products that fully integrate hardware, system software, technologies, and edge applications.

We are demonstrating,

globally, that the Veea Edge Platform Ô enables our partners and customers to champion

digital transformations in multiple vertical markets.

Through our innovative Veea Edge Platform,

we have created a new product category that brings cloud capabilities close to the user, as an alternative to cloud computing, with benefits

in optimal latency, lower data transport costs, data privacy, security and ownership, Edge AI, “always-on” availability at

the edge for mission critical applications, and contextual awareness for people, devices and things connected to the Internet.

was recognized in 2023 by Gartner as a Leading Smart Edge Platform for the innovativeness and capabilities of our Veea Edge Platform

and a Cool Vendor in Edge Computing in 2021.

Veea was named in Market Reports World’s research report published in October 2023

as one of the top 10 Edge AI solution providers alongside IBM, Microsoft, Amazon Web Services, and others.

On September 13, 2024, Plum Acquisition

(“Plum”), a special purpose acquisition company, and VeeaSystems Inc., a Delaware corporation (“Private Veea”),

consummated a business combination (the “Business Combination”), pursuant to that certain Business Combination Agreement,

dated November 27, 2023 (as amended on June 13, 2024 and September 13, 2024, the “Business Combination Agreement”), between

Plum, Private Veea, and Plum Merger Sub, a Delaware corporation) (“Plum Merger Sub”).

In connection with the consummation

of the Business Combination (the “Closing”), (i) Plum de-registered from the Register of Companies in the Cayman Islands by

way of continuation out of the Cayman Islands and into the State of Delaware, migrating to and domesticating as a Delaware corporation

(the “Domestication”) and (ii) the merger (the “Merger”) of Plum Merger Sub with and into Private Veea was completed

and the separate corporate existence of Plum Merger Sub ceased, with Private Veea as the surviving corporation becoming a wholly owned

subsidiary of Plum.

Following the Closing, Plum changed its name from “Plum Acquisition Corp.

I” to “Veea Inc.”

(hereinafter “Veea” or “the Company”) and Private Veea changed its name from “Veea Inc.” to “VeeaSystems

Inc.” See Note 4 for more information.

The Company has five wholly owned

subsidiaries:

VeeaSystems Inc., formerly known as Veea Inc., a Delaware corporation;

Veea Solutions Inc., a Delaware corporation;

Development Inc., formerly known as Veea Systems Inc., a Delaware corporation;

Veea Systems Ltd., a company organized under the laws

of England and Wales;

and VeeaSystems SAS, a French simplified joint stock company;

and one majority owned subsidiary, VeeaSystems Mexico,

The Company is dedicated to simplifying the journey towards creating

a world in which virtually everyone and everything is intelligently connected, while bringing applications and

artificial intelligence to the edge of the network.

Most service providers, equipment suppliers, system integrators and even hyperscalers

have adopted or advocated for similar solutions to various degrees either independently or in collaboration with the Company.

to our knowledge, we are the first to market with patented technologies that (a) bring virtualized data center capabilities to the far

edge of the network, commonly referred to as the Device Edge, where all wired and wireless devices connect to the network, (b) spawns

hyperconvergence of computing, multiaccess communications and storage, (c) provides for Cloud-managed applications at the Edge (“Hybrid

Edge-Cloud Computing”), and (d) enables machine learning with AI training, inferencing, and agentic AI at the edge (“Edge

AI”) including AI-driven cybersecurity for heterogenous networks.

Such networks have given rise through any combination of our developed

devices and third-party devices, with CPUs, GPUs, TPUs, DPUs and/or NPUs, that run on the VeeaONE platform’s software stack.

end-to-end edge-cloud platform is referred to as VeeaONETM (“VeeaONE”) platform.

Veea has developed several generations

of highly integrated all-in-one devices that incorporate a Linux server, with a virtualized software environment, supporting our patented

secured docker containers, together with a Wi-Fi Access Point with a mesh router, a firewall, an IoT gateway, NVMe data storage and 4G/5G

With an extensive patent portfolio of 123 granted patents and 32 pending patent applications that cover 26 patent families, our

end-to-end Hybrid Edge-Cloud Computing platform represents a new product category that has the potential for wide scale customer adoption

in large segments of consumer and enterprise markets.

VeeaONE platform’s products,

applications, and services with a distributed computing architecture, offered as a Platform-as-a-Service capability, empowering companies

to capitalize on the transformative potential of Edge AI, where most of the data from smartphones, tablets, laptops, cameras, sensors,

and other devices is generated, with data privacy and sovereignty, reliability, low latency for real-time decisions, bandwidth efficiency,

scalability, and reduced costs compared to alternatives.

VeeaHub products, about the size of

a typical Wi-Fi Access Point, are offered in variety of form factors with different capabilities for indoor and outdoor coverage and are

both locally- and cloud-managed.

VeeaONE architecture and business model, VeeaHub and third-party devices on VeeaONE platform with Hybrid

Edge-Cloud Computing and AI-enabled applications and services.

The VeeaONE platform offers an alternative

to cloud computing by enabling the formation of highly secure, but easily accessible, private clouds and networks across one or multiple

user(s) or enterprise location(s) across the globe.

The benefits include optimal latency, lower data transport costs, data privacy, security

and ownership, Edge AI, as well as “always-on” availability for mission critical applications, and contextual awareness for

people, devices and things connected to the Internet.

Our products and services have been

deployed across multiple countries and industries;

however, we are focused on high-growth market segments such as fixed-line or 5G-based

fixed wireless broadband access, and subscription-based managed Wi-Fi for unserved and underserved communities.

In both cases, broadband

or Internet connectivity services are offered with a variety of Edge applications and value-added services, including advanced AI-driven

cybersecurity, through Mobile Network Operators, Multiple System Operators, Internet Service Providers and other types of Managed Service

The industrial applications include climate smart buildings, smart farming with precision agriculture, smart warehouses and

smart retail as cloud-managed converged private networks.

Gartner recognized the innovativeness and capabilities of the platform

by naming the Company a Leading Smart Edge Platform in 2023 and Cool Vendor in Edge Computing in 2021.

Market Reports World in its research

report published in October 2023 named the Company as one of the top 10 Edge AI solution providers alongside of IBM, Microsoft, Amazon

Web Services and others.

Private Veea was founded in 2014 by

Allen Salmasi, our Chief Executive Officer and a pioneering wireless technology leader.

Salmasi helped to drive industry transformation

through his contributions to the development of CDMA/TDMA-based OmniTRACS, the largest mobile satellite messaging and position reporting

system with integrated IoT solutions during the 1980s and 1990s;

CDMA-based 2G/3G technologies and products at Qualcomm in 1990s;

4G technologies and products at NextWave during the 2000s, and hyper-converged edge computing and communications during the 2010s;

beyond with the Company.

The Company has six wholly owned subsidiaries, VeeaSystems Inc., formerly

known as Veea Inc.

a Delaware corporation, (“Private Veea”), Veea Solutions Inc., a Delaware corporation, VeeaSystems Development

Inc., formerly known as Veea Systems Inc., a Delaware corporation, Veea Systems Ltd., a company organized under the laws of England and

Wales, VeeaSystems SAS, a French simplified joint stock company and VeeaSystems CK Inc., a Delaware corporation;

and one majority owned

subsidiary, VeeaSystems Mexico, S.

de C.V., a limited capital company organized under the laws of Mexico (“VeeaSystems MX”).

VeeaSystems MX is 95 %

owned by VeeaSystems Inc., and due to local law requirements, the remaining 5 % is held by the Company’s CEO.

The Company is headquartered

in New York City with offices in the United States, Mexico, and Europe.

VeeaSystems MX is 95 % owned by VeeaSystems Inc., and due to local law requirements, the remaining 5 % is held by the Company’s CEO.

The Company is headquartered in New York City with offices in the United States, Mexico and Europe.

2 - LIQUIDITY AND MANAGEMENT’S PLAN

During the three months ended March

31, 2025 and 2024, the Company incurred operating losses of $ 5.7 million and $ 6.1 million, respectively, and had an accumulated deficit

of $ 213.5 million as of March 31, 2025.

Since its inception, the Company has incurred significant operating losses and negative cash flows.

During the three months ended June

30, 2025 and 2024, the Company incurred operating losses of $ 4.9 million and $ 6.8 million, respectively, and during the six months ended

June 30, 2025 and 2024, the Company incurred operating losses of $ 10.7 million and $ 12.4 million, respectively, and had an accumulated

deficit of $ 220.9 million as of June 30, 2025.

Since its inception, the Company has incurred significant operating losses and negative

The Company expects to continue to incur net losses as it continues to grow and scale its business.

As of March 31, 2025, the Company

had cash of $ 247,341 and outstanding debt of $ 15.2 million, of which $ 750,000 was outstanding under the September 2024 Notes (as defined

below), $ 14.0 million was outstanding under the working capital facility, and $ 485,000 was related party debt outstanding under the NLabs

2025 Notes (as defined below).

As of June 30, 2025, the

Company had cash of $ 238,008 and outstanding debt of $ 20.2 million, of which $ 750,000 was outstanding under the September 2024 Notes (as

defined below), $ 1.0 million was outstanding under the Crowdkeep Convertible Notes (as defined below), $ 14.0 million was outstanding under

the working capital facility, $ 2,626,000 was related party debt outstanding under the NLabs 2025 Notes (as defined below), and $ 1.8 million

was outstanding under a notes payable with an inventory vendor.

Although the Company has had recurring

losses each year since inception, the Company plans to fund its operations and capital funding needs through a combination of private

and public equity and debt offerings, or a combination thereof, including (1) cash proceeds from the ELOC Program (as defined below) (2)

the expected cash tax refund of up to $ 2.0 million in respect of the Company’s UK subsidiary’s 2023 and 2024 research and

development activities (3) the anticipated refund by June 30, 2025, of up to $ 5.0 million of the Company’s prepayment for purchased

inventory and (4) potential additional investments in the form of debt or equity to fund operating deficits from existing and/or new investors,

including related parties, which may include the Company’s CEO and his affiliates.

The Company expects it will be able to fund its

operations over the next twelve months and has a reasonable basis to believe it has alleviated substantial doubt regarding its ability

to continue as a going concern.

Since January 1, 2025, the Company has received $ 826,000 in additional loans from related parties and

$ 1.0 million in loans from unrelated parties in connection with the consummation of the acquisition of Crowdkeep.

See Note 12 and Note

17 for additional information.

Although management continues to pursue these plans, there is no assurance that the Company will be successful

in obtaining sufficient funding on terms acceptable to the Company, if at all.

losses each year since inception, the Company plans to fund its operations and capital funding needs for the next 12 months through a

combination of private and public equity and debt offerings, or a combination thereof, including (1) ) cash proceeds of approximately

$ 6.0 million from the Offering (as defined below), (2) the ELOC Program (as defined below)(3) the expected cash tax refund of up to $ 1.0

million in respect of the Company’s UK subsidiary’s 2023 and 2024 research and development activities, and (4)) potential

additional investments in the form of debt or equity to fund operating deficits from existing and/or new investors, including related

parties, which may include the Company’s CEO and his affiliates.

The Company has a reasonable basis to believe it has alleviated

substantial doubt regarding its ability to continue as a going concern.

Since January 1, 2025, the Company has received approximately

$ 3.2 million in additional loans from related parties and $ 1.0 million in loans from unrelated parties in connection with the consummation

of the acquisition of Crowdkeep.

See Note 13 for additional information.

Although management continues to pursue these plans, there is

no assurance that the Company will be successful in obtaining sufficient funding on terms acceptable to the Company, if at all.

3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 unchanged sentences

of America (“GAAP”) and the rules and regulations of the U.S.

Securities and Exchange Commission (the “SEC”)

for interim financial information.

Accordingly, certain information and footnote disclosures normally included in consolidated financial

statements in accordance with GAAP have been omitted.

Securities and Exchange Commission (the “SEC”) for

interim financial information.

Accordingly, certain information and footnote disclosures normally included in consolidated financial statements

in accordance with GAAP have been omitted.

In the opinion of management, all adjustments considered necessary for a fair presentation

13 unchanged sentences

The condensed consolidated balance

sheet as of March 31, 2025, has been derived from the unaudited consolidated financial statements at that date, but does not include all

sheet as of June 30, 2025, has been derived from the unaudited consolidated financial statements at that date, but does not include all

disclosures, including notes required by GAAP for complete financial statements.

13 unchanged sentences

Actual results could differ from these estimates.

Changes in such estimates could affect amounts reported in future

Changes in such estimates could affect amounts reported in

future periods.

On an ongoing basis, the Company evaluates its estimates and judgments including those related to:

liquidity and going concern,

the useful lives and recoverability of property and equipment and definite-lived intangible assets;

the recoverability of goodwill and

indefinite-lived intangible assets;

liquidity and going

concern, the useful lives and recoverability of property and equipment and definite-lived intangible assets;

the recoverability of goodwill

and indefinite-lived intangible assets;

the carrying value of accounts receivable, including the determination of the allowance for credit

8 unchanged sentences

Emerging Growth Company Status

The Company is an emerging growth

company, as defined in the JOBS Act.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards

issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies.

The Company has elected

to use this extended transition period for complying with new or revised accounting standards that have different effective dates for

public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively

and irrevocably opts out of the extended transition period provided in the JOBS Act.

As a result, these financial statements may not

be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

The Company is an emerging growth company,

as defined in the JOBS Act.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued

subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies.

The Company has elected to

use this extended transition period for complying with new or revised accounting standards that have different effective dates for public

and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably

opts out of the extended transition period provided in the JOBS Act.

As a result, these financial statements may not be comparable to

companies that comply with the new or revised accounting pronouncements as of public company effective dates.

Segment Information

4 unchanged sentences

The majority of the Company’s

assets as of March 31, 2025 and December 31, 2024, were attributable to its U.S.

The Company does not have any customers that

make up more than 10 % of revenue, and its long-lived assets are based on the physical location of the assets.

assets as of June 30, 2025 and December 31, 2024, were attributable to its U.S.

For the three months ended June 30, 2025,

one customer accounted for more than 10% of the Company’s consolidated revenues.

For the six months ended June 30, 2025, two customers

accounted for more than 10% of the Company’s consolidated revenues.

The Company’s long-lived assets are based on the physical

location of the assets.

Recent Accounting Pronouncements

In December 2023, the FASB issued

ASU 2023-09, Income Taxes (Topic 740):

In December 2023, the FASB issued ASU

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

3 unchanged sentences

disclosures on income tax expense and taxes paid, net of refunds received, by jurisdiction.

The new standard is effective for annual

periods beginning after December 15, 2024, on a prospective basis with the option to apply it retrospectively.

The new standard is effective for annual periods

beginning after December 15, 2024, on a prospective basis with the option to apply it retrospectively.

Early adoption is permitted.

The adoption of this guidance results in the Company being required to include enhanced income tax-related disclosures.

adoption of this guidance results in the Company being required to include enhanced income tax-related disclosures.

The Company adopted

23 unchanged sentences

on the Company’s condensed consolidated financial statements.

In November 2024, the FASB issued ASU

2024-03 - Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40).

In January 2025,

the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic

Clarifying the Effective Date to clarify the effective date of ASU 2024-03.

The amendments in this ASU require a public business

entity to disclose specific information about certain costs and expenses in the notes to its financial statements for interim and annual

reporting periods.

The objective of the disclosure requirements is to provide disaggregated information about a public business entity’s

expenses to help investors (a) better understand the entity’s performance, (b) better assess the entity’s prospects for future cash flows,

and (c) compare an entity’s performance over time and with that of other entities.

The additional disclosures under this update include

(1) disclosing the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depreciation,

depletion, and amortization recognized as part of oil and gas-producing activities (DD&A) (or other amounts of depletion expense)

that are included in each relevant expense caption, (2) include certain amounts that are already required to be disclosed under current

generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements, (3) disclose a qualitative

description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and (4) disclose

the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses.

The amendments

in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after

December 15, 2027.

Early adoption is permitted.

The Company is currently evaluating the impact of this ASU on its condensed consolidated

financial statements.

4 - ACQUISITION

On May 13, 2025, the Company entered

into an Asset Purchase Agreement (the “APA”) with Crowdkeep, Inc., a Delaware corporation (the “Seller”), pursuant

to which, the Company acquired (the “Crowdkeep Closing”), certain assets of Seller relating to Seller’s IoT technology

platform business (the “Crowdkeep Assets”), free and clear of any liens other than certain specified liabilities of Seller

that were assumed (the “Crowdkeep Liabilities”).

In consideration for the acquisition, the Company issued 4,065,689 shares

of its Common Stock (the “Purchase Price”).

The transaction was accounted for as

an asset acquisition, as the Company determined that substantially all of the fair value was concentrated in a single identifiable intangible

asset, proprietary technology, and therefore applied a model consistent with asset acquisition accounting.

The total purchase consideration

of $ 6,957,456 was comprised of equity consideration of $ 6,830,358 based on the number of shares issued at the closing share price, and

direct acquisition-related costs for legal and advisory of approximately $ 127,098 , the total of which was allocated to the acquired assets

on a relative fair value basis.

Because this was not a business combination, no goodwill was recognized.

The transaction was considered a related

party transaction due to the involvement of a Company board member who was also the CEO and shareholder of Crowdkeep.

The Company established

a special committee of the Board comprised of independent members of the Board, that evaluated and approved the transaction, concluding

that the terms were commercially reasonable and negotiated at arm’s length.

The patented technology which is recorded

as part of intangible assets, net in the condensed consolidated balance sheet, will be amortized over its estimated useful life of 10

5 - REVERSE RECAPITALIZATION

13 unchanged sentences

who previously held certain capital stock of Private Veea have the contingent right to receive up to 4.5 million additional shares of

the common stock, par value $ 0.0001 per share, of the Company (“Common Stock”) if certain trading-price based milestones

of the Company’s Common Stock are achieved or a change of control transaction occurs during the ten-year period following the Closing.

the common stock, par value $ 0.0001 per share, of the Company (“Common Stock”) if certain trading-price based milestones of

the Company’s Common Stock are achieved or a change of control transaction occurs during the ten-year period following the Closing.

Under accounting principles, the Company’s

20 unchanged sentences

Depreciation expense for the three

months ended March 31, 2025 and 2024, totaled $ 35,697 and $ 54,851 , respectively.

months ended June 30, 2025 and 2024, totaled $ 36,335 and $ 54,000 , respectively.

Depreciation expense for the six months ended June 30,

2025 and 2024, totaled $ 77,391 and $ 109,000 , respectively.

7 - GOODWILL AND INTANGIBLE ASSETS

The following is a summary of activity

in goodwill for the three months ended March 31, 2025 and 2024:

in goodwill for the six months ended June 30, 2025 and 2024:

Balance at December 31, 2024

Foreign exchange transactions

Balance at March 31, 2025

Balance at June 30, 2025

Balance at December 31, 2023

Foreign exchange transactions

Balance at March 31, 2024

Balance at June 30, 2024

Intangible Assets

Intangible assets consist of the following:

As of March 31, 2025

As of June 30, 2025

Period Costs as of

4 unchanged sentences

Patents 15 years $ 7,551,468 $ 158,464 - 7,709,932 ( 6,803,650 ) - $ 906,282

Proprietary technology 10 years -

6,904,306 ( 89,029 ) -

Intangible assets, net 7,551,468 7,062,770 -

14,614,238 ( 6,892,679 ) -

As of December 31, 2024

6 unchanged sentences

5,015,694 ( 3,554,784 ) ( 1,460,910 ) -

Other intellectual assts 5 years 969,278 -

969,278 ( 969,278 ) -

Intangible assets, net $ 12,347,921 $ 219,241 $ -

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Intangible assets primarily consist

of patents, patent applications, and in-process research and development (“IPR&D”) and other identifiable intangible assets.

of proprietary technology, patents, patent applications, and in-process research and development (“IPR&D”) and other identifiable

intangible assets.

Intangible assets are generally amortized on a straight-line basis over the periods of benefit.

The Company’s patents have estimated

remaining economic useful lives ranging from 5 - 15 years.

Management reviews intangible assets for impairment when events and circumstances

During the three months ended March 31, 2025 and 2024, there were no events that necessitated additional impairment of intangible

The Company’s

patents have estimated remaining economic useful lives ranging from 5 - 15 years and the proprietary technology associated with the Crowdkeep

Transaction, as defined below, has an estimated remaining useful life of 10 years.

Management reviews intangible assets for impairment

when events and circumstances warrant.

During the six months ended June 30, 2025 and 2024, there were no events that necessitated additional

impairment of intangible assets.

Intangible asset amortization expense

for the three months ended March 31, 2025 and 2024, totaled $ 19,000 and $ 14,065 , respectively.

for the three months ended June 30, 2025 and 2024, totaled $ 108,272 and $ 14,000 , respectively.

Intangible asset amortization expense for

the six months ended June 30, 2025 and 2024, totaled $ 127,272 and $ 28,000 , respectively.

Future estimated amortization expense

for the Company’s intangible assets is approximately as follows:

Future estimated amortization as of March 31, 2025

Future estimated amortization as of June 30, 2025

Remainder of 2025

Total outstanding debt of the Company

is comprised of the following, including convertible notes and other related party debt:

March 31, 2025

is comprised of the following, including convertible notes:

June 30, 2025

Revolving Loan Facility

Convertible note payable

Convertible note payable, current

Convertible note payable, net

Notes payable

December 31, 2024

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Following the acquisition of First Republic, the Loan was transferred to the Bank.

borrowings during the three months ended March 31, 2025, were $ 1.3 million.

As of March 31, 2025, the outstanding principal amount of

the Loan was $ 14.0 million, and there is no availability to borrow additional funds.

were no borrowings during the three months ended June 30, 2025, and $ 1.3 million of borrowings during the six months ended June 30, 2025.

As of June 30, 2025, the outstanding principal amount of the Loan was $ 14.0 million, and there is no availability to borrow additional

Convertible Note Payable

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The Company and VeeaSystems Inc.

(“VeeaSystem”)

(“VeeaSystems”)

are co-borrowers under each September 2024 Note (together, the “Borrowers”) and are jointly responsible for the obligations

to each Investor thereunder.

Each September 2024 Note has a maturity date of 18 months after the Financing Closing but is prepayable

in whole or in part by the Borrowers at any time without penalty.

The outstanding obligations under each September 2024 Note accrues

interest at a rate equal to the Secured Overnight Financing Rate plus 2 % per annum, adjusted quarterly, but interest is only payable

upon the maturity date of the September 2024 Note as long as there is no event of default thereunder.

Each September 2024 Note is unsecured

and expressly subordinated to any senior debt of the Borrowers.

The September 2024 Notes and the Note Purchase Agreements do not include

any operational or financial covenants for the Borrowers.

Each September 2024 Note includes customary events of default including, without

limitation, failure to pay amounts due on the maturity date, failure to otherwise comply with the Borrowers’ covenants or for Borrower

insolvency events, in each case, with customary cure periods.

Upon an event of default, the Investor may accelerate all obligations under

its September 2024 Note and the Borrowers will be required to pay for the Investor’s reasonable out-of-pocket collection costs.

Each September 2024 Note has a maturity date of 18 months after the Financing Closing but is prepayable in

whole or in part by the Borrowers at any time without penalty.

The outstanding obligations under each September 2024 Note accrues interest

at a rate equal to the Secured Overnight Financing Rate plus 2 % per annum, adjusted quarterly, but interest is only payable upon the maturity

date of the September 2024 Note as long as there is no event of default thereunder.

Each September 2024 Note is unsecured and expressly

subordinated to any senior debt of the Borrowers.

The September 2024 Notes and the Note Purchase Agreements do not include any operational

or financial covenants for the Borrowers.

Each September 2024 Note includes customary events of default including, without limitation,

failure to pay amounts due on the maturity date, failure to otherwise comply with the Borrowers’ covenants or for Borrower insolvency

events, in each case, with customary cure periods.

Upon an event of default, the Investor may accelerate all obligations under its September

2024 Note and the Borrowers will be required to pay for the Investor’s reasonable out-of-pocket collection costs.

The outstanding obligations under each

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such Conversion Shares would be extended for an additional 6 months to 12 months after the Financing Closing.

As of March 31, 2025, $ 750,000

As of June 30, 2025, $ 700,000

in aggregate principal amount of the September 2024 Notes, together with associated interest, had automatically converted upon the occurrence

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See Note 15 for further information.

On April 17, 2025,

and May 13, 2025, the Company and the majority stockholder of the Seller (“Crowdkeep Investor”), entered into two Note Purchase

Agreements (the “Crowdkeep Note Purchase Agreements”).

Pursuant to the Crowdkeep Note Purchase Agreements, the Crowdkeep Investor

loaned to the Company an aggregate of $ 1,000,000 in two tranches (the “Crowdkeep Loans”), of which $ 500,000 was provided on

April 17, 2025 and $ 500,000 was provided on May 13, 2025.

In connection with the entry into the Crowdkeep Note Purchase Agreements the

Company issued to the Crowdkeep Investor unsecured convertible promissory notes (the “Crowdkeep Convertible Notes”).

The Crowdkeep

Convertible Notes have an aggregate principal amount of $ 1,000,000 , and the interest under the Crowdkeep Convertible Notes accrues at

an annual rate of 8 %.

The maturity date of the Crowdkeep Convertible Notes are April 17, 2026, and May 13, 2026, respectively.

Pursuant to the terms of the Convertible

Notes, upon an event of default, the outstanding principal amount of the applicable Crowdkeep Convertible Note, plus accrued but unpaid

interest, will become immediately due and payable in full.

Events of default include failure to pay any principal or interest amounts

under the Crowdkeep Convertible Notes, failure to perform covenants in the Crowdkeep Convertible Notes and certain bankruptcy and insolvency

conditions of the Company.

The Company may prepay all or any portion of the Crowdkeep Convertible Notes at any time.

The Crowdkeep Convertible

Notes are convertible, in whole or in part, into shares of Common Stock (the “Crowdkeep Conversion Shares”) at the option

of the Crowdkeep Investor, at a price per share of $ 5.00 subject to certain equitable adjustments.

The Crowdkeep Convertible Notes will

automatically convert on the date that the closing price of the Common Stock is at $ 7.50 or above for ten ( 10 ) consecutive trading days

within any consecutive thirty ( 30 ) trading day period, equal to the lesser of (i) $ 7.50 per share and (ii) 20 % multiplied by the VWAP

(calculated as set forth in the Crowdkeep Convertible Notes) for the prior consecutive thirty ( 30 ) trading day period, in each case subject

to certain equitable adjustments.

The Crowdkeep Note Purchase Agreements and Crowdkeep Convertible Notes include other customary terms

and conditions.

9 - INVESTMENTS

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financial instrument within the fair value hierarchy based on the nature of the fair value inputs.

Any adjustments to the carrying

values are recognized in other income, net in the Company’s consolidated statements of operations and comprehensive loss.

December 31, 2024, the Company performed the qualitative assessment for impairment of its investments.

Based on this qualitative assessment,

impairment indicators were present for one of its investments;

therefore, the company performed an analysis to estimate its fair value

and recognized an impairment loss of $ 216,278 .

As of March 31, 2025, there were no indicators of impairment.

The carrying value of the

Company’s private company investments as of March 31, 2025 and December 31, 2024, was $ 235,666 and $ 235,596 , respectively, which

were classified as Investments on the Company’s consolidated balance sheets, as these investments do not have a stated contractual

maturity date.

Any adjustments to the carrying values

are recognized in other income, net in the Company’s consolidated statements of operations and comprehensive loss.

As of December

31, 2024, the Company performed the qualitative assessment for impairment of its investments.

Based on this qualitative assessment, impairment

indicators were present for one of its investments;

therefore, the company performed an analysis to estimate its fair value and recognized

an impairment loss of $ 216,278 .

As of June 30, 2025, there were no indicators of impairment.

The carrying value of the Company’s

private company investments was $ 235,737 as of both June 30, 2025 and December 31, 2024.

These investments, which do not have a stated

contractual maturity date, were classified as Investments on the Company’s consolidated balance sheets.

10 - STOCKHOLDERS’ EQUITY

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consummated the Business Combination which was accounted for as a reverse recapitalization.

In connection with the consummation

of the Business Combination (i) the Company de-registered from the Register of Companies in the Cayman Islands by way of continuation

out of the Cayman Islands and into the State of Delaware, migrating to and domesticating as a Delaware corporation (the “Domestication”)

In connection with the consummation of

the Business Combination (i) the Company de-registered from the Register of Companies in the Cayman Islands by way of continuation out

of the Cayman Islands and into the State of Delaware, migrating to and domesticating as a Delaware corporation (the “Domestication”)

and (ii) restated our certificate of incorporation (“Restated Certificate of Incorporation”).

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Common Stock.

During the three months ended March

31, 2025, the Company received $ 604,426 in proceeds and issued 240,500 shares of Common Stock pursuant to the ELOC Program.

During the three and six months ended

June 30, 2025, the Company received $ 232,340 and $ 836,766 , respectively, in proceeds and issued 117,500 and 358,000 shares, respectively,

of Common Stock, pursuant to the ELOC Program.

The Company agreed to issue to White

Lion shares of Common Stock as a commitment fee (the “Commitment Shares”).

The fair value of the Commitment Shares

was $ 25,000 , which pursuant to ASC 815, was recorded in transaction costs in the condensed consolidated statement of operations and comprehensive

income (loss) during the three months ended March 31, 2025.

The Common Stock Purchaser has agreed that during the term of the Common Stock

Purchase Agreement, neither it nor any of its affiliates will engage in any short sales or hedging transactions involving the Common Stock.

The fair value of the Commitment Shares was $ 25,000 ,

which pursuant to ASC 815, was recorded in transaction costs in the condensed consolidated statement of operations and comprehensive income

(loss) during the six months ended June 30, 2025.

The Common Stock Purchaser has agreed that during the term of the Common Stock Purchase

Agreement, neither it nor any of its affiliates will engage in any short sales or hedging transactions involving the Common Stock.

the Common Stock Purchase Agreement provided for the issuance of additional Commitment Shares to the Common Stock Purchaser if the Company

failed to sell at least $ 1,000,000 in gross proceeds to the Common Stock Purchaser by the sixth-month anniversary of signing of the Common

Stock Purchase Agreement.

The Company and the Common Stock Purchaser amended the Common Stock Purchase Agreement effective of June 2,

2025 (the “ELOC Amendment”) to provide for (i) an extension of the time period to December 15, 2025 and (ii) an increase the

gross proceeds sold under the Common Stock Purchase Agreement to $ 1,250,000 .

If the Company fails to sell such amount of, the number of

additional Commitment Shares would be equal to $ 50,000 divided by the volume weighted average stock price of the Common Stock 10 days

prior to December 15, 2025.

11 - STOCK INCENTIVE PLANS

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grant of stock options, which may be ISOs or non-statutory stock options (“NSOs”), stock appreciation rights (“SARs”),

restricted shares, restricted stock units and other stock or cash-based awards that the Administrator determines are consistent with the

purpose of the 2024 Incentive Plan.

As of March 31, 2025, the Company had approximately 1,259,370 shares available for grant.

restricted shares, restricted stock units (“RSUs”) and other stock or cash-based awards that the Administrator determines

are consistent with the purpose of the 2024 Incentive Plan.

As of June 30, 2025, the Company had approximately 429,724 shares available

On June 4, 2024, the stockholders of

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less than 85 % of the lower of the fair market value per share of the Common Stock on either the offering date or on the purchase date.

As of March 31, 2025, there have not yet been any offering periods available to purchase Common Stock under the ESPP.

As of June 30, 2025, there have not yet been any offering periods available to purchase Common Stock under the ESPP.

In connection with the Business Combination,

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Black-Scholes option-pricing model.

For options granted during the three months ended March 31, 2025 and 2024, respectively, the weighted

For options granted during the six months ended June 30, 2025 and 2024, respectively, the weighted

average estimated fair value using the Black-Scholes option pricing model was $ 1.04 and $ 0.55 per option, respectively.

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Options Weighted-

Exercise Price

per Share Weighted-

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Exercised ( 477 ) -

Forfeited ( 12,245 ) 2.78 -

Outstanding at March 31, 2025 3,784,037 $ 1.64 8.50

Exercisable at March 31, 2025 3,744,271

Forfeited / Expired ( 33,055 ) 1.80 -

Outstanding at June 30, 2025 3,936,107 $ 3.60 8.5

Exercisable at June 30, 2025 3,806,983 3.66 8.46

The fair value of each stock option

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The assumptions used to calculate

the fair value of the options granted during the three months ended March 31, 2025, were as follows:

the fair value of the options granted during the six months ended June 30, 2025, were as follows:

Stock Price $ 1.64

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Stock compensation expense related

to the common stock options outstanding for the three months ended March 31, 2025 and 2024, was $ 50,000 and $ 62,670 , respectively, which

to the common stock options outstanding for the six months ended June 30, 2025 and 2024, was $ 158,257 and $ 334,774 , respectively, which

is included in general and administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive

income (loss).

Total unrecognized expense related to unvested options outstanding as of March 31, 2025, was $ 135,863 which will be recognized

Total unrecognized expense related to unvested options outstanding as of June 30, 2025, was $ 179,076 which will be recognized

over a weighted average period of 2.43 years.

Restricted Stock Units

There were no RSUs granted or stock

compensation expense recorded during each of the three months ended March 31, 2025 and 2024.

RSU activity under the Plan was as

Unvested at December 31, 2024

Unvested at June 30, 2025

Stock compensation expense related

to the RSUs for the six months ended June 30, 2025 was $ 281,655 which is included in general and administrative expenses in the Company’s

condensed consolidated statements of operations and comprehensive income (loss).

There were no RSUs granted during the six months ended

June 30, 2024.

Total unrecognized expense related to unvested RSUs as of June 30, 2025, was $ 824,670 which will be recognized over a weighted

average period of 0.8 years.

12 - WARRANTS

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the “Warrants”) where each Private Placement Warrant allows the holder to purchase one share of the Common Stock at $ 11.50

At March 31, 2025, there were 6,384,326 Public Warrants and 5,256,218 Private Placement Warrants outstanding.

At June 30, 2025, there were 6,384,326 Public Warrants and 5,256,218 Private Placement Warrants outstanding.

The Public Warrants become exercisable

at per share, subject to adjustment, at any time commencing 30 days after the completion of the Business Combination;

that the Company has an effective registration statement under the Securities Act covering the shares of Common Stock issuable upon exercise

of the Public Warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their warrants

provided that the

Company has an effective registration statement under the Securities Act covering the shares of Common Stock issuable upon exercise of

the Public Warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their warrants

on a cashless basis under the circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from

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Such registration statement was declared effective by the SEC on January 15, 2025.

With the exception of the Private

Placement Warrants, in no event will the Company be required to net cash settle any warrant.

In the event that a registration statement

is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for

the unit solely for the shares of Common Stock underlying such Warrant.

With the exception of the Private Placement

Warrants, in no event will the Company be required to net cash settle any warrant.

In the event that a registration statement is not effective

for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit solely

for the shares of Common Stock underlying such Warrant.

Redemption of Warrants When the

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● at a price of $ 0.01 per warrant;

● upon not less than 30 days’

prior written notice of redemption to each warrant holder;

● if, and only if, the last reported

sale price of our Common Stock equals or exceeds $ 18.00 per share (as adjusted for adjustments to the number of shares issuable upon

exercise or the exercise price of a warrant) for any 20 trading days within a 30 -trading day period ending three trading days before

the Company sends the notice of redemption to the warrant holders.

● upon not less than 30 days’ prior written notice of redemption to each warrant holder;

● if, and only if, the last reported sale price of our Common Stock equals or exceeds $ 18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant) for any 20 trading days within a 30 -trading day period ending three trading days before the Company sends the notice of redemption to the warrant holders.

Redemption of Warrants When the

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in whole and not in part;

● at $ 0.10 per warrant upon a

minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless

basis prior to redemption and receive that number of shares, based on the redemption date and the “fair market value” (as

defined above) of our Common Stock;

● if, and only if, the closing

price of our Common Stock equals or exceeds $ 10.00 per public share (as adjusted for adjustments to the number of shares issuable upon

exercise or the exercise price of a warrant) for any 20 trading days within the 30-trading day period ending three trading days before

the Company sends the notice of redemption to the warrant holders;

● if the closing price of our

Common Stock for any 20 trading days within a 30 -trading day period ending on the third trading day prior to the date on which the Company

sends the notice of redemption to the warrant holders is less than $ 18.00 per share (as adjusted for adjustments to the number of shares

issuable upon exercise or the exercise price of a warrant), the Private Placement Warrants must also be concurrently called for redemption

on the same terms as the outstanding Public Warrants, as described above.

● at $ 0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares, based on the redemption date and the “fair market value” (as defined above) of our Common Stock;

● if, and only if, the closing price of our Common Stock equals or exceeds $ 10.00 per public share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant) for any 20 trading days within the 30-trading day period ending three trading days before the Company sends the notice of redemption to the warrant holders;

● if the closing price of our Common Stock for any 20 trading days within a 30 -trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders is less than $ 18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.

The Private Placement Warrants were

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(i) would not be redeemable by

the Company and (ii) may be exercised for cash or on a cashless baseless so long as they are held by the initial purchasers or their

permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the

Public Warrants.

The Public Warrants were initially

classified as a derivative liability instrument.

Upon the closing of the Business Combination, the Public Warrants in accordance with

the guidance contained in ASC 815 are no longer precluded from equity classification.

Equity-classified contracts are initially measured

at fair value (or allocated value).

Subsequent changes in fair value are not recognized as long as the contracts continue to be classified

the Company and (ii) may be exercised for cash or on a cashless baseless so long as they are held by the initial purchasers or their permitted

transferees, the Private Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the Public Warrants.

The Public Warrants were initially classified

as a derivative liability instrument.

Upon the closing of the Business Combination, the Public Warrants in accordance with the guidance

contained in ASC 815 are no longer precluded from equity classification.

Equity-classified contracts are initially measured at fair value

(or allocated value).

Subsequent changes in fair value are not recognized as long as the contracts continue to be classified in equity.

The Company continues to recognize the

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of operations and comprehensive income (loss) at each reporting period until they are exercised.

As of March 31, 2025, the Private Placement

As of June 30, 2025, the Private Placement

Warrants are presented within warrants on the condensed consolidated balance sheet.

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in payment of the purchase price.

In connection with the Business Combination,

Private Veea’s outstanding equity-classified Preferred stock warrants were exchanged for common stock warrants of the Company (each

an “Exchanged Warrant”) to purchase a number of shares of Common Stock, after adjustment for anti-dilutive shares, equal to

the product of (i) the number of shares of Private Veea’s common stock subject to such Preferred Stock warrant immediately prior

to the Business Combination and (ii) the Exchange Ratio, at an exercise price per share equal to (A) the exercise price per share of such

Preferred Stock warrant immediately prior to the consummation of the Business Combination, divided by (B) the Exchange Ratio.

6, 2024, the warrant holder exercised warrants to purchase 79,654 shares of Common Stock at an exercise price of $ 0.05 per share for an

aggregate purchase price of $ 3,983 .

The outstanding Exchanged Warrants are exercisable at the option of the holder until September 28,

2028, for an exercise price of $ 10.19 per share.

As of March 31, 2025, there are 159,307 Exchanged Warrants outstanding.

In connection with the Business Combination, Private

Veea’s outstanding equity-classified Preferred stock warrants were exchanged for common stock warrants of the Company (each an “Exchanged

Warrant”) to purchase a number of shares of Common Stock, after adjustment for anti-dilutive shares, equal to the product of (i)

the number of shares of Private Veea’s common stock subject to such Preferred Stock warrant immediately prior to the Business Combination

and (ii) the Exchange Ratio, at an exercise price per share equal to (A) the exercise price per share of such Preferred Stock warrant

immediately prior to the consummation of the Business Combination, divided by (B) the Exchange Ratio.

On November 6, 2024, the warrant

holder exercised warrants to purchase 79,654 shares of Common Stock at an exercise price of $ 0.05 per share for an aggregate purchase

price of $ 3,983 .

The outstanding Exchanged Warrants are exercisable at the option of the holder until September 28, 2028, for an exercise

price of $ 10.19 per share.

As of June 30, 2025, there are 159,307 Exchanged Warrants outstanding.

13 - RELATED PARTY TRANSACTIONS

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Rent for the office space is accrued and not paid in cash.

Company recognized rent expense of $ 61,200 for each of the three months ended March 31, 2025 and 2024, which was classified as general

and administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive income (loss).

and unpaid rent expense included in the Company’s condensed consolidated balance sheets was $ 1,774,800 as of March 31, 2025 and

Company recognized rent expense of $ 122,400 for each of the six months ended June 30, 2025 and 2024, which was classified as general and

administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive income (loss).

and unpaid rent expense included in the Company’s condensed consolidated balance sheets was $ 1,836,000 as of June 30, 2025 and $ 1,713,600

as of December 31, 2024.

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The Company recognized

rent expense of $ 72,000 for each of the three months ended March 31, 2025, which is classified as general and administrative expenses

in the Company’s condensed consolidated statements of operations and comprehensive income (loss).

Accrued and unpaid rent expense

included in the Company’s condensed consolidated balance sheets was $ 2,016,000 and $ 1,944,000 as of March 31, 2025 and December

rent expense of $ 144,000 for each of the six months ended June 30, 2025, which is classified as general and administrative expenses in

the Company’s condensed consolidated statements of operations and comprehensive income (loss).

Accrued and unpaid rent expense included

in the Company’s condensed consolidated balance sheets was $ 2,088,000 and $ 1,944,000 as of June 30, 2025 and December 31, 2024,

respectively.

Related Party Debt

In 2021 and 2022, NLabs made loans

to the Company evidenced by promissory notes aggregating $ 9,500,000 (the “Bridge Notes”).

The Bridge Notes bore interest

on the outstanding principal at a rate of 10 % per annum, calculated on the basis of a 365-day year.

The original maturity date of the

Bridge Notes was December 31, 2022, which was extended to December 31, 2023, which was subsequently extended to September 30, 2024.

Company accounted for the extension as a modification of the Bridge Notes.

The unpaid principal amount and accrued unpaid interest on

the Bridge Notes was due and payable upon the date of the first to occur of (i) the maturity date and (ii) the consummation of a debt

or equity financing transaction with an unrelated third party.

Interest expense for the three months ended March 31, 2024 was $ 237,500 .

In 2022 and 2023, NLabs made loans

to the Company evidenced by promissory notes in the aggregate principal amount of $ 3,098,000 (the “Promissory Notes” and

collectively with the Bridge Notes, the “Related Party Notes”).

The Promissory Notes bore interest on the outstanding principal

amount at a rate of 10 % per annum, calculated on the basis of a 365-day year.

The unpaid principal amount and accrued interest on the

Promissory Notes was due and payable upon the earlier of demand and December 31, 2023, which was subsequently extended to September 30,

Interest expense for the three months ended March 31, 2024 was $ 57,963 .

At the Closing in September 2024,

the Related Party Notes were converted into shares of Common Stock at a price of $ 5.00 per share, which shares were not considered Existing

Veea Shares and were in addition to the shares of Common Stock issued to holders of Existing Veea Shares.

Thus, there was no interest

expense recorded for the three months ended March 31, 2025, for the Related Party Notes.

See Note 4 for further information regarding

the conversion of the Related Party Notes.

During the three months ended March

31, 2025, NLabs made loans to the Company in the aggregate amount of $ 485,000 (the “March NLabs Notes”).

Interest on the

loans accrue at a rate of 10 % per annum, calculated on the basis of a 365-day year.

Principal and accrued interest is payable on

the earlier of demand or June 30, 2025.

In April 2025, NLabs made additional loans in the aggregate amount of $ 341,000 (collectively

with the March NLabs Notes, the “2025 NLabs Notes”).

At the Closing of the Business Combination,

promissory notes evidencing loans made by NLabs to the Company from 2021 through the Closing (the “Related Party Notes”) in

the aggregate amount, including accrued interest, of $ 15,739,897 , were converted into shares of Common Stock at a price of $ 5.00 per share,

which shares were not considered Existing Veea Shares and were in addition to the shares of Common Stock issued to holders of Existing

See Note 4 for further information regarding the conversion of the Related Party Notes.

During the six months ended June 30, 2025, NLabs made loans to the

Company in the aggregate principal amount of $ 2,626,000 .

Subsequent to June 30, 2025, NLabs made additional loans to the Company in the

aggregate principal amount of $ 550,000 .

(collectively, the “NLabs 2025 Notes”).

Interest on the loans accrue at a rate of 10 %

per annum, calculated on the basis of a 365-day year.

Accrued interest on the NLabs 2025 Notes through June 30, 2025 was $ 28,432 .

Company satisfied the payment of the outstanding NLabs 2025 Notes, plus accrued interest, in the aggregate amount of approximately $3,239,096,

with the issuance of approximately 3,239,096 shares of Common Stock with accompanying common warrants issued in the Offering, based on

the assumed offering price of $ 1.00 per share.

See Note 15 for additional information.

14 - COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

Manufacturers and Suppliers

As of March 31, 2025, the Company

had no unconditional purchase obligations for the purchase of goods or services from suppliers and contract manufacturers.

Unconditional

purchase obligations are obligations that are enforceable and legally binding on the Company and specify all significant terms, including

quantities to be purchased, fixed, minimum or variable price provisions and the approximate timing of the transaction.

Unconditional

purchase obligations exclude agreements that are cancellable without penalty.

As of June 30, 2025, the Company had

no unconditional purchase obligations for the purchase of goods or services from suppliers and contract manufacturers.

Unconditional purchase

obligations are obligations that are enforceable and legally binding on the Company and specify all significant terms, including quantities

to be purchased, fixed, minimum or variable price provisions and the approximate timing of the transaction.

Unconditional purchase obligations

exclude agreements that are cancellable without penalty.

The Company leases office space in

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Indemnifications

In the normal course of business,

the Company has indemnification obligations to other parties, including customers, lessors, and parties to other transactions with us,

with respect to certain matters.

The Company has agreed to indemnify against losses arising from a breach of representations or covenants

or out of intellectual property infringement or other claims made against certain parties.

In the normal course of business, the

Company has indemnification obligations to other parties, including customers, lessors, and parties to other transactions with us, with

respect to certain matters.

The Company has agreed to indemnify against losses arising from a breach of representations or covenants or

out of intellectual property infringement or other claims made against certain parties.

These agreements may limit the time or circumstances

7 unchanged sentences

agreements with its officers and directors, and its Amended and Restated Bylaws contain similar indemnification obligations to its agents.

In the normal course of business,

the Company may become involved in various lawsuits and legal proceedings.

In the normal course of business, the

Company may become involved in various lawsuits and legal proceedings.

The Company accrues contingent liabilities when it is probable

7 unchanged sentences

mutually agreed to be deferred to periods after the Closing.

As of March 31, 2025, the amount of the deferred fees totaled $ 2.2 million,

As of June 30, 2025, the amount of the deferred fees totaled $ 2,257,457 ,

recorded in deferred payables, current in the condensed consolidated balance sheet.

2 unchanged sentences

Warrant liability

The Company’s initial value

of the warrant liability was based on a valuation model utilizing management judgment and pricing inputs from observable and unobservable

The Company’s initial value of

the warrant liability was based on a valuation model utilizing management judgment and pricing inputs from observable and unobservable

markets with less volume and transaction frequency than active markets and classified as level 3.

4 unchanged sentences

from these estimates and inputs could result in a material change in fair value.

During the three months ended March 31, 2025, there

were no transfers amongst level 1, 2, and 3 values during the period.

During the six months ended June 30, 2025, there were

no transfers amongst level 1, 2, and 3 values during the period.

The conversion feature of the Convertible

1 unchanged sentence

The following table presents fair value

information as of March 31, 2025 and December 31, 2024, of the Company’s financial assets and liabilities that were accounted for

information as of June 30, 2025 and December 31, 2024, of the Company’s financial assets and liabilities that were accounted for

at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine

such fair value.

March 31, 2025

June 30, 2025

Private warrant liability

9 unchanged sentences

fair value for the convertible note option liability as of September 13, 2024, which was the date the Convertible Note was executed.

of March 31, 2025, the fair value was remeasured using an option pricing model.

of June 30, 2025, the fair value was remeasured using an option pricing model.

The option pricing model was used to value the convertible

32 unchanged sentences

The computation of basic and dilutive

net loss per share attributable to common stockholders for the three months ended March 31, 2025 and 2024, are as follows:

net loss per share attributable to common stockholders for the six months ended June 30, 2025 and 2024, are as follows:

Three Months Ended

Net income (loss) attributable to common shareholders

Six Months Ended

Net loss attributable to common shareholders

$ ( 7,410,858 )

( 7,278,070 )

$ ( 3,111,806 )

$ ( 13,297,064 )

Weighted-average common shares outstanding

Net income (loss) per share – basic:

Net loss per share – basic:

Net income (loss) attributable to common and common equivalent shareholders

( 7,410,858 )

( 7,278,070 )

( 3,111,806 )

( 13,297,064 )

Weighted-average common stock outstanding

Stock options, warrants, Earn-Out Liability, and convertible notes outstanding to purchase shares of common stock

Stock options, RSUs, warrants, Earn-Out Liability, and convertible notes outstanding to purchase shares of common stock

Total common and common equivalent shares outstanding

Net income (loss) per share – diluted:

The weighted average potential shares of common stock that were excluded

from the calculation of net income (loss) per share-diluted for the periods presented because including them would have been anti-dilutive

consisted of the following:

Net loss per share – diluted:

The weighted average potential shares of common

stock that were excluded from the calculation of net income (loss) per share-diluted for the periods presented because including them

would have been anti-dilutive consisted of the following:

Three Months Ended

Stock options outstanding to purchase shares of common stock

Six Months Ended

Stock options outstanding to purchase shares of common stock and RSUs

Public and Private Warrants

Convertible Notes

The weighted average potential shares of common stock that were excluded

from the calculation of net loss per share-diluted because the performance or market conditions associated with these awards were not

met are as follows for the periods presented:

Three Months Ended

Six Months Ended

Earn-Out Liability

11 unchanged sentences

The Company’s matching

contributions to the Plan for the three months ended March 31, 2025 and 2024, totaled $ 37,240 and $ 40,553 , respectively.

contributions to the Plan for the six months ended June 30, 2025 and 2024, totaled $ 37,240 and $ 77,697 , respectively.

A total of $ 202,050

is reflected in accrued expenses in the condensed consolidated balance sheet for matching contributions accrued but not yet paid.

18 - SUBSEQUENT EVENTS

The Company evaluated subsequent events

from March 31, 2025, the date of these financial statements, through the date on which the financial statements were issued (the “Issuance

Date”), for events requiring recording or disclosure in the financial statements as of and for the three months ended March 31,

The Company concluded that no events have occurred that would require recognition or disclosure in the financial statements, except

as described below.

Asset Purchase Transaction with

Crowdkeep, Inc.

Asset Purchase Agreement

On May 13, 2025, the Company entered

into an Asset Purchase Agreement (the “APA”) with Crowdkeep, Inc., a Delaware corporation (the “Seller”), pursuant

to which, subject to the terms and conditions set forth in the APA, the Company acquired, upon the closing (the “Crowdkeep Closing”,

and the date of such Crowdkeep Closing, the “Crowdkeep Closing Date”) certain assets of Seller relating to Seller’s

IoT technology platform business (collectively, the “Crowdkeep Assets”), free and clear of any liens other than certain specified

liabilities of Seller that are being assumed (collectively, the “Crowdkeep Liabilities” and such acquisition of the Crowdkeep

Assets and assumption of the Crowdkeep Liabilities together, the “Crowdkeep Transaction”) in consideration for the issuance

to the Seller of 4,065,689 shares of Common Stock (the “Purchase Price”).

The APA contains other customary representations,

warranties and covenants of the parties.

The foregoing summary of the APA is not complete and is qualified in its entirety by reference

to the full text of the APA, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

Note Purchase Agreements and

Convertible Promissory Notes

On April 17, 2025, and May 13, 2025,

the Company and the majority stockholder of the Seller (“Crowdkeep Investor”), entered into two Note Purchase Agreements (the

“Crowdkeep Note Purchase Agreements”).

Pursuant to the Crowdkeep Note Purchase Agreements, the Crowdkeep Investor loaned to

the Company an aggregate of $ 1,000,000 in two tranches (the “Crowdkeep Loans”), of which $ 500,000 was provided on April 17,

2025 and $ 500,000 was provided on May 13, 2025.

In connection with the entry into the Crowdkeep Note Purchase Agreements the Company issued

to the Crowdkeep Investor unsecured convertible promissory notes (the “Crowdkeep Convertible Notes”).

The Crowdkeep Convertible

Notes have an aggregate principal amount of $ 1,000,000 , and the interest under the Crowdkeep Convertible Notes accrues at an annual rate

The maturity date of the Crowdkeep Convertible Notes are April 17, 2026, and May 13, 2026, respectively.

Pursuant to the terms of the Convertible

Notes, upon an event of default, the outstanding principal amount of the applicable Crowdkeep Convertible Note, plus accrued but unpaid

interest, will become immediately due and payable in full.

Events of default include failure to pay any principal or interest amounts

under the Crowdkeep Convertible Notes, failure to perform covenants in the Crowdkeep Convertible Notes and certain bankruptcy and insolvency

conditions of the Company.

The Company may prepay all or any portion of the Crowdkeep Convertible Notes at any time.

The Crowdkeep Convertible

Notes are convertible, in whole or in part, into shares of Common Stock (the “Crowdkeep Conversion Shares”) at the option

of the Crowdkeep Investor, at a price per share of $ 5.00 subject to certain equitable adjustments.

The Crowdkeep Convertible Notes will

automatically convert on the date that the closing price of the Common Stock is at $ 7.50 or above for ten (10) consecutive trading days

within any consecutive thirty (30) trading day period, equal to the lesser of (i) $7.50 per share and (ii) 20% multiplied by the VWAP

(calculated as set forth in the Crowdkeep Convertible Notes) for the prior consecutive thirty (30) trading day period, in each case subject

to certain equitable adjustments.

The Crowdkeep Note Purchase Agreements and Crowdkeep Convertible Notes include other customary terms

and conditions.

The above description of the Crowdkeep

Note Purchase Agreements and Crowdkeep Convertible Notes are qualified in their entirety by the text of the Form of Note Purchase Agreement

and Form of Convertible Note, copies of which are attached hereto as Exhibit 10.2 and 10.3, respectively, and incorporated herein by reference.

Lock-Up Agreements

In connection with the Crowdkeep APA

and the Crowdkeep Note Purchase Agreements, the Seller and the Crowdkeep Investor entered into lock-up agreements pursuant to which the

Seller and the Crowdkeep Investor agreed not to effect any sale, distribution or transfer of any of the shares of Common Stock received

in the transaction or any Crowdkeep Conversion Shares will be subject to transfer restrictions and restrictions against selling short

or hedging the Company’s securities for a period of six (6) months following the applicable closing of the APA or the Crowdkeep

Note Purchase Agreement, respectively, subject to certain limited exceptions.

The form of lock-up agreement signed

by the Seller is herein referred to as the “Crowdkeep Lock-Up Agreement” and the form of lock-up agreement signed by the Investor

is herein referred to as the “Crowdkeep Noteholder Lock-Up Agreement.” The Crowdkeep Lock-Up Agreement and the Crowdkeep Noteholder

Lock-Up Agreement have substantially similar terms, but the Crowdkeep Lock-Up Agreement provides for distributions by the Seller to the

Seller’s stockholders, pro rata based on their ownership of Seller, subject to certain conditions.

The foregoing description of the Crowdkeep

Lock-Up Agreement and Crowdkeep Noteholder Lock-Up Agreement do not purport to be complete and are qualified in its entirety by the terms

and conditions of the form of Crowdkeep Lock-Up Agreement and form of Crowdkeep Noteholder Lock-Up Agreement, copies of which are attached

hereto as Exhibit 10.4 and Exhibit 10.5, respectively, and are incorporated herein by reference.

Appointment of Chief Strategy Officer

and Senior Vice President, Finance

On May 1, 2025, Randal V.

was appointed the Company’s Senior Vice President, Finance and Chief Strategy Officer.

from June 30, 2025, the date of these financial statements, through the date on which the financial statements were issued (the “Issuance

Date”), for events requiring recording or disclosure in the financial statements as of and for the six months ended June 30, 2025.

The Company concluded that no events have occurred that would require recognition or disclosure in the financial statements, except as

described below:

Public Offering

On August 14, 2025, the Company closed

a public offering to purchase up to 9,189,096 shares of common stock and warrants to purchase up to 9,189,096 shares of common stock at

a combined offering price of $ 1.00 per share and accompanying warrant (the “Offering”).

The Company received aggregate cash

gross process of approximately $ 6.0 million, before deducting placement agent fees and other offering expenses.

The warrants have an exercise

price of $ 1.10 per share, are exercisable immediately and will expire five years from the original issuance date.

Included in the aggregate

securities issued are 3,239,096 shares of common stock and accompanying warrants that were issued to NLabs in consideration and satisfaction

of the NLabs 2025 Notes.

The Company intends to use the net proceeds from the Offering for investments in inventory and the Company’s

customer support infrastructure and for other working capital and general corporate purposes.

Supply Agreement

August 7, 2025, VeeaSystems Inc., a Delaware corporation (“VeeaSystems”), a wholly owned subsidiary of Veea Inc., a Delaware

corporation (the “Company”), entered into a certain Framework Agreement for the Licenses, Equipment and Services (the “Supply

Agreement”) with RadioMovil Dipsa, S.A.

(“Telcel”), a Mexican wireless telecommunications company

owned by América Móvil, effective August 7, 2025.

The Supply Agreement was signed by the parties following the completion

of an extensive certification and homologation process with Telcel;

and the successful completion of trials with certain Telcel enterprise

customers of the Company’s VeeaHub STAX Ò -5G

product, incorporating Telcel SIM cards.

Supply Agreement sets forth the general guidelines, terms and conditions that govern the solution implementation and marketing, as well

as the provisioning of the services provided by VeeaSystems.

Under the agreement, VeeaSystems will supply a comprehensive Platform-as-a-Service

solution featuring 5G-based Fixed Wireless Access (FWA) through its VeeaHub STAX Ò -5G

device, which incorporates 4G and 5G cellular connectivity, Wi-Fi 6 Access Point, IoT gateway, storage and Linux server capabilities to

deliver connectivity with integrated AI-driven cybersecurity services, managed connectivity, and monitoring tools while capable of hosting

applications on STAX-5G including third-party application.

The parties have agreed to work together in the development of the marketing

strategy, branding and promotion of VeeaSystems’s services to Telcel’s customers in Mexico.

The agreement provides for an

initial term of three years and automatically renews for successive one-year terms, unless either party elects not to renew upon 90 -day

prior notice.

Appointment of Acting Chief Financial

On July 15, 2025, Randal V.

was appointed as the Company’s Acting Chief Financial Officer.

Appointment of Acting Chief Revenue

On July 15, 2025, Mr.

Helder Antunes

a current member of the Company’s Board of Directors was appointed acting Chief Revenue Officer.

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