UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED ~~March~~June 3130, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38078

ENVIROTECH VEHICLES, INC.

(Exact name of registrant as specified in its charter)

Delaware	46-0774222
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

7510 Ardmore Street

Houston, TX 77054

(Address of principal executive offices, including zip code)

(870) 970-3355

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

	Trading	Name of each exchange
Title of each class	Symbol(s)	on which registered
Common Stock, par value $0.00001 per share	EVTV	Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s common stock, $0.00001 par value per share, as of ~~May 15~~August 12, 2025 was 253,~~670~~530,~~211~~546.

ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES

TABLE OF CONTENTS

FORM 10-Q FOR THE QUARTERLY PERIOD ENDED ~~March~~June 3130, 2025

		PAGE
Special Note Regarding Forward-Looking Statements		1
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements:		2
	Unaudited Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024	2
	Unaudited Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024	2
	Unaudited Consolidated Statements of Operations for the Three Months Ended March 31, 2025 and 2024	3
	Unaudited Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024	3
	Unaudited Consolidated Statement of Stockholders’ Equity for the Three Months Ended March 31, 2025 and 2024	4
	Unaudited Consolidated Statement of Stockholders’ Equity for the Three and Six Months Ended June 30, 2025 and 2024	4
	Unaudited Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2025 and 2024	5
	Unaudited Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024	5
	Notes to Unaudited Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		16
Item 3. Quantitative and Qualitative Disclosure about Market Risk		2021
Item 4. Controls and Procedures		2021
	Part II. OTHER INFORMATION
Item 1. Legal Proceedings		2122
Item 1A. Risk Factors		2122
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		2122
Item 3. Defaults Upon Senior Securities		2122
Item 4. Mine Safety Disclosures		2122
Item 5. Other Information		2122
Item 6. Exhibits		2223
Signatures		2324

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Quarterly Report”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to future events or our future financial performance or condition and involve known and unknown risks, uncertainties and other factors that could cause our actual results, levels of activity, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “contemplate,” “plan,” “project,” “forecast,” “potential,” “possible,” “proposed,” “should,” “develop,” “opportunity,” “target,” “outlook,” “optimistic,” “poised,” “positioned,” “maintain,” “continue,” “aim,” “goal,” “will” and “would” or the negatives of these terms or other comparable terminology intended to identify statements about the future.

You should not place undue reliance on forward-looking statements. The cautionary statements set forth in this Quarterly Report, including in “Risk Factors” and elsewhere, identify important factors, which you should consider in evaluating our forward-looking statements. These factors could cause actual results and events to differ materially from those expressed or implied in any forward-looking statement and include, among other things:

•

our ability to generate demand for our zero-emission commercial fleet vehicles in order to generate revenue;

•

our dependence upon external sources for the financing of our operations;

	•	our ability to effectively execute our business plan;

	•	our ability to successfully integrate and realize the benefits of strategic acquisitions;

•

our ability and our suppliers’ ability to scale our zero-emission products assembling processes effectively and quickly from low volume production to high volume production;

	•	our ability to manage our expansion, growth and operating expenses and reduce and adequately control the costs and expenses associated with operating our business;

	•	the potential impact of product recalls and product liability claims relating to the products we distribute and other litigation;

•

our ability and our manufacturing partners’ ability to navigate current and future disruptions to the global supply chain and to procure the raw materials, parts, and components necessary to produce our vehicles on terms acceptable to us and our customers;

•

our ability to obtain, retain and grow our customers, and our dependence on a limited number of customers;

	•	our ability to enter into, sustain and renew strategic relationships on favorable terms;

	•	our dependence on, and retention of, key personnel;

	•	our ability to achieve and sustain profitability;

	•	the impact of legislation and/or government regulation on our business and industry, including, without limitation, the status of government subsidies, rebates and economic incentives that support the development and demand for our products and services;

	•	ongoing and anticipated changes in the U.S. political environment, including those resulting from the new Presidential administration, and changes to regulatory agencies;

	•	changes in trade policies and the imposition of tariffs and other trade barriers in the jurisdictions where we source our materials or sell our products;

•

our ability to evaluate and measure our current business and future prospects;

•

our ability to compete and succeed in a highly competitive and evolving industry;

	•	our ability to respond and adapt to changes in electric vehicle technology;

	•	the cost and adequacy of insurance coverage and increases in the number of severity of insurance and claims expenses;

• our ability to protect our intellectual property and to develop, maintain and enhance a strong brand; ~~and~~ • disruptions in our information technology systems, including, but not limited to, system failures, cyber-attacks, unauthorized physical or electronic access, or other natural or mad-made incidents or disasters; and • our ability to maintain compliance with the listing requirements of the Nasdaq Stock Market LLC (“Nasdaq”) and the impact of any steps taken to maintain such compliance, including the Reverse Stock Split (as defined below) on our operations, stock price and future access to funds.

You should read this Quarterly Report and the documents that we reference elsewhere in this Quarterly Report completely and with the understanding that our actual results may differ materially from what we expect as expressed or implied by our forward-looking statements. Forward-looking statements are subject to a number of known and unknown risks, uncertainties, assumptions and other important factors, including, but not limited to, those discussed in Part I, Item 2 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) and in Part II, Item 1A (Risk Factors) of this Quarterly Report as we as in Part I, Item 1 (Business) and Item 1A (Risk Factors and Part II, Item 7 (Management's Discussion and Analysis of Financial Condition and Results of Operations) of our Annual Report on Form 10-K filed with the United States Securities and Exchange Commission ~~(the "SEC")~~ on April 15, 2025. In light of the significant risks and uncertainties to which our forward-looking statements are subject, you should not place undue reliance on such forward-looking statements or regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified timeframe, or at all. These forward-looking statements represent our estimates and assumptions only as of the date of this Quarterly Report regardless of the time of delivery of this Quarterly Report. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this Quarterly Report.

Unless expressly indicated or the context requires otherwise, references in this Quarterly Report to “Envirotech,” the “Company,” “we,” “our,” and “us” refer to Envirotech Vehicles, Inc., a Delaware corporation, and our consolidated subsidiaries, unless the context indicates otherwise.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(unaudited)

	March 31,			December 31,
	June 30,			December 31,
	2025			2024
ASSETS
Current assets:
Cash and cash equivalents	$	~~211~~942,~~284~~241		$	1,941,181
Accounts receivable, net of allowance of $13,596 and $15,306 respectively		852,125			1,016,666
Accounts receivable, net of allowance of $406,690 and $15,306 respectively		440,292			1,016,666
Receivable from related party, net of allowance of $21,304 and $6,700 respectively		1,195,963			993,300
Receivable from related party, net of allowance of $40,633 and $6,700 respectively		2,155,247			993,300
Miscellaneous receivables		2,249,515			—
Inventory, net		4,855,679			6,416,377
Inventory, net		6,249,268			6,416,377
Inventory deposits		7,465,129			6,036,809
Inventory deposits		8,711,812			6,036,809
Prepaid expenses		361,217			1,130,027
Prepaid expenses		500,431			1,130,027
Other current assets		91,481			101,794
Other current assets		94,919			101,794
Total current assets		16,311,286			17,636,154
Total current assets		20,065,317			17,636,154
Property and equipment, net		1,969,713			592,171
Property and equipment, net		710,814			592,171
Right-of-use asset		608,206			108,508
Right-of-use asset		73,590			108,508
Goodwill		—			10,103,048
Intangible assets, net		3,~~745~~523,~~801~~301			3,968,301
Other non-current assets		~~249~~331,~~161~~576			263,120
Total assets	$	2422,~~844~~744,~~683~~082		$	32,671,302
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	12,~~808~~164,~~134~~871		$	1,470,102
Deferred revenue		6,525,081			4,240,666
Accrued liabilities		2,~~192~~036,~~065~~395			2,069,061
Operating lease liability - short-term		~~205~~339,~~156~~693			235,625
Options liability, at fair value		—			132,412
Debt - current		45,~~940~~365,~~779~~276			3,596,805
Total current liabilities		1516,~~671~~431,~~215~~316			11,744,671
Long-term liabilities
Debt - long-term		2,605			4,168
Operating lease liability - long-term		404,313			—
Total liabilities		15,673,820			11,748,839
Debt - long-term		1,042			4,168
Total liabilities		16,836,671			11,748,839
Stockholders’ equity:
Preferred stock, 5,000,000 authorized, $0.00001 par value per share, none issued and outstanding as of March 31, 2025, and December 31, 2024		—			—
Preferred stock, 5,000,000 authorized, $0.00001 par value per share, none issued and outstanding as of June 30, 2025, and December 31, 2024		—			—
Common stock, 350,000,000 authorized, $0.00001 par value per share, 23,106,392 and 19,872,612 issued and outstanding as of March 31, 2025, and December 31, 2024, respectively		233			201
Common stock, 350,000,000 authorized, $0.00001 par value per share, 3,220,058 and 1,987,262 issued and outstanding as of June 30, 2025, and December 31, 2024, respectively		32			20
Additional paid-in capital		9698,~~668~~551,~~485~~971			94,383,~~736~~917
Accumulated deficit		(8792,~~497~~644,~~855~~592	)		(73,461,474	)
Total stockholders’ equity		95,~~170~~907,~~863~~411			20,922,463
Total liabilities and stockholders’ equity	$	2422,~~844~~744,~~683~~082		$	32,671,302

See Accompanying Notes to Unaudited Consolidated Financial Statements.

ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

	For the Three Months Ended						For the Six Months Ended
	March 31,			March 31,
	June 30,			June 30,			June 30,			June 30,
	2025			2024			2025			2024
Sales, net	$	~~590~~1,~~567~~047,029		$	~~810~~812,~~490~~770		$	1,637,595		$	1,623,260
Cost of sales		~~471~~2,~~175~~504,746			~~502~~608,~~271~~947			2,975,921			1,111,218
Gross profit		~~119~~(1,~~392~~457,717	)		~~308~~203,~~219~~823			(1,338,326	)		512,042
Operating expenses
General and administrative		32,~~603~~751,~~108~~788			31,~~194~~466,~~251~~748			6,354,896			4,660,999
Consulting		~~46,511~~—			—			46,511			—
Research and development		98590,~~398~~121			7061,~~265~~616			688,519			131,880
Goodwill impairment charge		10,103,048			—
Goodwill impairment		—			—			10,103,048			—
Total operating expenses, net		133,~~851~~341,~~065~~909			31,~~264~~528,~~516~~364			17,192,974			4,792,879
Loss from operations	$	(134,~~731~~799,~~673~~626	)	$	(21,~~956~~324,~~297~~541	)	$	(18,531,300	)	$	(4,280,837	)
Other (expense)/income:
Interest income (expense), net		~~10,754~~303			(61,~~143~~067	)		11,056			(7,210	)
Unrealized loss on financial instruments at fair value		(~~283~~290,~~793~~144	)		(1570,~~569,927~~519	)		(573,937	)		(999,408	)
Other expense		(31,669	)		4
Realized loss on conversion of convertible notes		(76,764	)		—			(76,764	)		—
Total other expense		(304,708	)		(1,576,066	)
Other income/(expense)		19,494			(3	)		(12,173	)		—
Loss before income taxes		(14,036,381	)		(4,532,363	)
Total other expense		(347,111	)		569,449			(651,818	)		(1,006,618	)
Income tax expense		—			—
Loss before income taxes		(5,146,737	)		(755,092	)		(19,183,118	)		(5,287,455	)
Net loss	$	(14,036,381	)	$	(4,532,363	)
Income tax expense		—			—			—			—
Net loss per share to common stockholders:
Net loss	$	(5,146,737	)	$	(755,092	)	$	(19,183,118	)	$	(5,287,455	)
Basic and diluted	$	(0.64	)	$	(0.29	)
Net loss per share to common stockholders:
Weighted shares used in the computation of net loss per share:
Basic and diluted	$	(2.01	)	$	(0.48	)	$	(8.10	)	$	(3.41	)
Basic and diluted		21,805,277			15,375,051
Weighted average shares used in the computation of net loss per share:
Basic and diluted		2,556,204			1,563,136			2,369,404			1,550,321

See Accompanying Notes to Unaudited Consolidated Financial Statements.

ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

Three and Six Months Ended ~~March~~June 3130, 2025 and 2024

(unaudited)

					Additional
	Common Stock				Paid-In		Accumulated			Stockholders’
	Shares		Amount		Capital		Deficit			Equity
Balance, December 31, 2024		191,~~872~~987,~~612~~262	$	~~201~~20	$	94,383,~~736~~917	$	(73,461,474	)	$	20,922,463
Convertible note conversion		3323,~~233,780~~378		323		1,738,~~173~~202		—			1,738,205
Stock based compensation		—		—		546,576		—			546,576
Net loss		—		—		—		(14,036,381	)		(14,036,381	)
Balance, March 31, 2025		232,~~106~~310,~~392~~640	$	~~233~~23	$	96,668,~~485~~695	$	(87,497,855	)	$	9,170,863
Common stock issued from convertible notes conversion		909,418		9		1,842,797		—			1,842,806
Stock based compensation		—		—		40,479		—			40,479
Net loss		—		—		—		(5,146,737	)		(5,146,737	)
Balance, June 30, 2025		3,220,058	$	32	$	98,551,971	$	(92,644,592	)	$	5,907,411

					Additional
	Common Stock				Paid-In		Accumulated			Stockholders’
	Shares		Amount		Capital		Deficit			Equity
Balance, December 31, 2023		151,~~171~~517,~~748~~175	$	~~152~~15	$	85,~~245~~246,~~925~~062	$	(64,612,499	)	$	20,633,578
Common stock issued for cash		~~348~~34,889		31		585,~~496~~498		—			585,499
Stock based compensation		—		—		1,818,383		—			1,818,383
Net loss		—		—		—		(4,532,363	)		(4,532,363	)
Balance, March 31, 2024		151,~~520~~552,~~637~~064	$	~~155~~16	$	87,649,~~804~~943	$	(69,144,862	)	$	18,505,097
Common stock issued for cash		17,078		—		363,749		—			363,749
Stock based compensation		—		—		35,045		—			35,045
Net loss		—		—		—		(755,092	)		(755,092	)
Balance, June 30, 2024		1,569,142	$	16	$	88,048,737	$	(69,899,954	)	$	18,148,799

See Accompanying Notes to Unaudited Consolidated Financial Statements.

ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	Three Months Ended
	Six Months Ended
	March 31,
	June 30,
	2025			2024
Cash flows from operating activities:
Net loss	$	(1419,~~036~~183,~~381~~118	)	$	(45,~~532~~287,~~363~~455	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		~~280~~559,~~684~~255			3975,~~212~~871
Unrealized loss on marketable securities		283,793			1,569,927
Unrealized loss on financial instruments at fair value		573,937			999,408
Stock based compensation expense		546,576			1,818,383
Realized loss on conversion of convertible notes		76,764			—
Goodwill impairment charge		10,103,048			—
Stock based compensation expense		587,055			1,853,428
Changes in assets and liabilities:
Accounts receivable		~~164~~576,~~541~~374			(~~333~~733,~~085~~998	)
Receivable from related party		(~~202~~1,~~663~~161,947	)		—
Cash outflow from fraudulent activity - See Note 2 - Miscellaneous receivable		(2,249,515	)		—
Inventory		1,560,698			127,372
Inventory		167,108			(410,126	)
Inventory deposits		(2,743,291	)		443,074
Inventory deposits		(2,675,003	)		466,757
Prepaid expenses		768,810			187,474
Prepaid expenses		629,596			257,086
Other current assets		10,313			25,439
Other current assets		6,875			25,439
Other non-current assets		(568,154	)		139,028
Other non-current assets		48,876			65,010
Accounts payable		694,769			195,786
Accounts payable		338,031			171,363
Accrued liabilities		(32,666	)		438,089
Accrued liabilities		123,006			207,437
Deferred revenue		2,284,415			—
Other liabilities		~~(30~~508,~~467~~381	)		(80164,~~611~~079	)
Net cash used in operating activities		(45,~~217~~385,~~480~~357	)		(~~735~~1,~~571~~700,563	)
Cash flows from investing activities:
Purchase of property and equipment		(176,828	)		—(135,288	)
Net cash used in investing activities		(176,828	)		—(135,288	)
Cash flows from financing activities:
Proceeds from issuance of common stock		—			~~585~~949,~~499~~248
Proceeds from issuance of convertible note		24,~~850~~750,500			901,000
Principal repayments on debt		(186,089	)		(158,290	)
Proceeds from debt		—			232,067
Net cash provided by financing activities		2,664,411			1,328,209
Principal repayments on debt		(187,255	)		(266,119	)
Net change in cash, restricted cash and cash equivalents		(1,729,897	)		592,638
Net cash provided by financing activities		4,563,245			1,816,196
Net change in cash, restricted cash and cash equivalents		(998,940	)		(19,655	)
Cash and cash equivalents at the beginning of the period		1,941,181			456,719
Cash and cash equivalents at the end of the period	$	~~211~~942,~~284~~241		$	1437,~~049,357~~064
Supplemental cash flow disclosures:
Cash paid for interest expense	$	68,~~234~~804		$	47,~~299~~258
Conversion of short-term note to common stock	$	1,738,205		$	—
Non-cash transfer of inventory deposits to property and equipment	$	1,314,971		$	—
Capital expenditures unpaid on March 31, 2025 and March 31, 2024	$	—		$	27,977
Cancellation of Convertible note cancelled and transferred to Notes payable - current	$	—		$	1,025,743
Conversion of short-term note to common stock	$	3,581,011		$	—
Capital expenditures unpaid on June 30, 2025 and June 30, 2024	$	—		$	4,187

See Accompanying Notes to Unaudited Consolidated Financial Statements.

ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.	Organization and Operations

Envirotech Vehicles, Inc. ~~(the “Company”)~~, including its consolidated subsidiaries (the "Company"), is a provider of purpose-built zero-emission electric vehicles focused on reducing the total cost of vehicle ownership and helping fleet operators unlock the benefits of green technology. The Company serves commercial and last-mile fleets, school districts, public and private transportation service companies, and colleges and universities to meet the increasing demand for light to heavy-duty electric vehicles. The Company’s vehicles address the challenges of traditional fuel price cost instability and local, state, and federal regulatory compliance. During the first quarter of 2025, the Company increased its business portfolio by adding two new business operations: (1) medical supplies and (2) drones.

On August 8, 2025, the Company effected a 1-for-10 reverse stock split of our common stock with no change to authorized shares of common stock. All share, options, warrants, restricted stock unit (“RSU”), and per share information through this Quarterly Report on Form 10-Q has been retroactively adjusted to reflect the reverse stock split. The shares of common stock retain a par value of $0.00001 per share. Accordingly, an amount equal to the par value of the decreased shares resulting from the reverse stock split was reclassified from “Common Stock” to “Additional paid-capital.”

2.	Summary of Significant Accounting Policies

Basis of Presentation—~~The~~These unaudited consolidated financial statements ~~and~~are ~~related~~prepared ~~disclosures include~~pursuant to the ~~consolidated~~rules ~~balance sheet accounts as of March 31, 2025~~ and ~~the~~regulations ~~consolidated results~~ of ~~operations for~~ the ~~three~~Securities ~~months ended March 31, 2025 of Envirotech Vehicles, Inc.~~ and ~~subsidiaries. These~~Exchange ~~consolidated~~Commission ~~financial statements are unaudited, pursuant to~~ (the ~~rules~~"SEC") ~~and~~regarding ~~regulations~~interim offinancial ~~the SEC~~reporting. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States ("U.S.") generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the Company’s opinion, these unaudited financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for the fair statement of the results for the interim periods. These unaudited financial statements should be read in conjunction with the Company's audited financial statements for the years ended December 31, 2024 and 2023 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 15, 2025. The results of operations for the three and six months ended ~~March~~June 3130, 2025 are not necessarily indicative of the results to be expected for the full year.

~~Principles~~Out of ~~Consolidation~~Period Adjustment—~~The~~During ~~accompanying~~the ~~financial~~three ~~statements~~months ~~reflect~~ended June 20, 2025, the ~~consolidation~~Company recorded out-of-period adjustments to correct errors related to the understatement of the sales and the understatement of research and development expense that were incorrectly omitted from the financial statements for the period ended March 31, 2025. Regarding the adjustment to sales the Company did not record sales for the three-month period ended March 31, 2025 due to lack of ~~Envirotech~~evidence ~~Vehicles~~that the performance obligation was met. An adjustment of $126,535 ~~Inc~~was recorded in the current period's statement of operations to recognize revenue associated with medical supplies that were delivered during the period. The research and ~~its~~development ~~wholly~~expense ~~owned~~error ~~subsidiaries~~was the result of Management not recognizing the nature of a development contract that was entered into during the period ended March 31, 2025 and beginning to expense the associated costs but rather those costs remained on the balance sheet within inventory deposits. ~~All~~The ~~significant~~adjustment ~~intercompany~~of ~~accounts~~$400,000 was recorded in the current period's statement of operations to recognize research and ~~transactions~~development ~~have~~expense ~~been~~and ~~eliminated~~a corresponding reduction in inventory deposits on the balance sheet. Management has evaluated the impact of the errors, both qualitatively and quantitatively, and determined that they were not material to the financial statements for the quarter ended March 31, 2025, or the current period.

Principles of Consolidation—The accompanying financial statements reflect the consolidation of the financial statements of Envirotech Vehicles, Inc. and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated.

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 and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments—The carrying values of the Company’s financial instruments, including cash, accounts receivable and accounts payable approximate their fair value due to the short-term nature of these financial instruments. Accounting Standards Codification ("ASC") 820, Fair Value Measurements ("ASC 820") defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. It also establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs that are supported by little or no market data and that require the reporting entity to develop its own assumptions.

The Company does not have any assets or liabilities that are required to be measured and recorded at fair value on a recurring basis other than the options liability and convertible note disclosed in Note 65 - Debt, in which the Company has elected the fair value option.

Revenue Recognition—The Company recognizes revenue from the sales of zero-emission electric vehicles and vehicle maintenance and inspection services and delivery of medical supplies to the customers of its related party. The Company recognizes revenue in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers ("ASC 606"), which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ~~At March~~The ~~31,~~Company ~~2025~~recorded net revenue of ($25,237) from the ~~Company~~delivery ~~did~~of ~~have~~electric vehicles as a ~~concentration~~result of ~~customers;~~certain ~~with~~credits ~~five customer balances~~given ~~accounting for~~to ~~approximately~~our ~~95% of~~customers ~~the~~for ~~outstanding~~operational ~~accounts receivable~~issues. The Company recorded ~~gross~~net revenue of $~~566~~1,~~800~~072,266 from the ~~sale~~delivery of ~~vehicles~~medical supplies to a related party for the three months ended ~~March~~June 3130, 2025. ~~Sales~~for ~~return~~the ~~from~~Company's ~~one~~medical ~~customer~~supplies ~~totaled $196,500~~segment. ~~Net~~One ~~revenue~~customer accounted ~~recorded~~for 100% of the net revenue for the three months ended ~~March~~June 3130, 2025 ~~was~~from ~~$373,300~~the delivery of an electric vehicle in the electric vehicle segment. Certain credit memos were issued to one customer due to one-time operational issues. One customer , a related party, accounted for 79100% ~~or $449,840~~ of the ~~gross~~net revenue for the three months ended ~~March~~June 3130, 2025~~. The~~ ~~Company~~for ~~had~~the ~~accounts~~Company's ~~receivable,~~medical ~~net~~supplies ~~of $852,125 and $1,016,666 on March 31, 2025 and December 31, 2024, respectively~~segment.

Net revenue recorded for the six months ended June 30, 2025 was $348,063 and $1,289,532 for the electric vehicles segment and medical supplies segment, respectively. Two customers accounted for 100% of the net revenue for the delivery of electric vehicles in the electric vehicles segment for the six months ended June 30, 2025. One customer, a related party, in the medical supplies segment accounted for 100% or $1,289,532 of the net revenue for the six months ended June 30, 2025.

In applying ASC 606, the Company is required to:

(1)

identify any contracts with customers;

(2)

determine if multiple performance obligations exist;

(3)

determine the transaction price;

(4)

allocate the transaction price to the respective obligation; and

(5)

recognize the revenue as the obligation is satisfied.

Product revenue primarily includes the sale of electric trucks and cargo vans. These sales represent a single performance obligation and revenue is recognized when the vehicle is delivered, the customer has accepted the vehicle and signed the appropriate documentation acknowledging receipt of the vehicle. At this time, the title of the vehicle is transferred to the customer.

~~During~~Medical ~~the~~supply ~~three months ended March 31, 2025, the Company also recorded~~ revenue ofis ~~$217,267~~recognized ~~from~~at the ~~delivery~~point ofin ~~medical~~time ~~supplies~~when tocontrol atransfers ~~related party. This revenue source is related~~ to the ~~Company's~~customer, ~~Medical~~which ~~Supplies~~in ~~segment.~~this ~~See~~arrangement, ~~Note~~occurs 14when -the ~~Segment~~gowns ~~Reporting,~~are ~~for further disclosures~~delivered.

Cash and Cash Equivalents—The Company considers all highly liquid investments purchased with an original or remaining maturity of three months or less to be cash equivalents. The recorded value of our restricted cash and cash equivalents approximates their fair value. The Company had no restricted cash at both ~~March~~June 3130, 2025 and December 31, 2024. See Concentration of Credit Risk below in this Note.

Marketable Securities—The Company invests in short-term, highly liquid, marketable securities, such as U.S. Treasury notes, U.S. Treasury bonds, and other government-backed securities. The Company classifies these marketable securities as held-to-maturity, as the intent is not to liquidate them prior to the respective stated maturity date. The Company had no marketable securities at both ~~March 31~~June 30, 2025 and December 31, 2024.

Accounts Receivable and Allowance for Doubtful Accounts— The accounts receivable balance relates to the Company's electric vehicles segment. The Company establishes an allowance for bad debts through a review of several factors, including historical collection experience, current aging status of the customer accounts, and financial condition of its customers. The Company does not generally require collateral for its accounts receivable. The Company had trade accounts receivable of $~~865~~846,~~721~~ 982 as of ~~March~~June 3130, 2025 and a recorded allowance for doubtful accounts of $13406,~~596~~690, resulting in a net trade accounts receivable balance of $~~852~~440,~~125~~292. The Company had trade accounts receivable of $1,031,972 as of December 31, 2024 and an allowance for doubtful accounts of $15,306, resulting in a net trade receivable balance of $1,016,666. A significant portion of the Company’~~selectric~~s electric vehicle sales are made to customers who qualify for state-sponsored grant programs which can cover a significant portion, up to all of a vehicle’s purchase price. Grant monies are paid directly to vehicle dealers like the Company after the customer and the dealer meet state requirements related to the transaction; reimbursements to the Company may take two to nine months from the date of request before being received. The Company does not provide an allowance for doubtful accounts related to electric vehicle sales made utilizing state grant funds, as those funds are guaranteed by the state(s) once awarded. The trade accounts receivable balance at ~~March~~June 3130, 2025 is primarily from credit-worthy customers, many of whom are fully or partially funded through state government sponsored programs. At June 30, 2025, the Company did have a concentration of customers; with five customer balances accounting for approximately 93% of the outstanding accounts receivable of the Company's electric vehicle segment.

Receivable from Related Party and Allowance for Doubtful Accounts—The receivable from related party relates to the Company's medical supplies segment. The allowance for doubtful accounts is established by reviewing several factors, including historical collection experience, current aging of the customer account and financial condition of its customer. The Company had receivable from related party of $12,~~217~~195,~~267~~880 and a recorded allowance of $2140,~~304~~633, resulting in a net receivable from related party of $2,155,247 as of June 30, 2025. The Company had a receivable from related party of $1,~~195~~000,~~963~~000 and a recorded allowance of $6,700, resulting in a net receivable from related party of $993,300 as of December 31, 2024.

~~Miscellaneous~~Inventory ~~Receivable~~and Inventory Valuation Allowance—~~During~~The Company records inventory at the ~~end~~lower of ~~the~~cost ~~first~~or ~~quarter~~market, ofand ~~2025~~uses a First In, ~~the~~First ~~Company~~Out accounting ~~discovered~~valuation ~~that~~methodology and establishes an ~~external~~inventory ~~party~~valuation ~~had~~allowance ~~perpetrated~~for ~~fraud~~vehicles ~~toward~~that it does not intend to sell in the future or when their cost has fallen below net realizable value. The Company had finished goods inventory on hand of $6,040,410 ~~resulting~~as inof June 30, 2025 and recorded an ~~unexplained~~inventory ~~withdrawal~~valuation allowance of $21,~~249~~184,~~515~~731 ~~from~~related to vehicles that the Company's ~~checking~~does ~~account.~~not ~~Subsequently~~intend to sell in ~~April~~ the future, resulting in a net inventory balance of $4,855,679 at June 30, 2025. The Company had finished goods inventory on hand and a related inventory valuation allowance of $6,428,806 ~~after~~and ~~thorough~~$12,429, ~~investigation~~respectively, as byof December ~~respective~~31, ~~parties~~2024, ~~the~~resulting ~~funds~~in ~~were~~a ~~deposited~~net ~~back~~inventory tobalance ~~the~~of ~~Company's~~$6,416,377 ~~checking~~as ~~account~~of December 31, 2024.

Inventory ~~and~~Deposits—Certain ~~Inventory~~of ~~Valuation~~our ~~Allowance—The~~vendors require the Company ~~records~~to ~~inventory~~pay atupfront ~~the~~deposits ~~lower~~before ofthey commence ~~cost~~manufacturing orour ~~market,~~vehicles and then ~~uses~~require aprogress ~~First~~deposits ~~In,~~through ~~First~~the ~~Out accounting~~production ~~valuation~~cycle ~~methodology~~ and ~~establishes~~before anthe ~~inventory~~finished ~~valuation~~vehicles ~~allowance~~are ~~for~~shipped. ~~vehicles~~These ~~that~~deposits itare ~~does~~classified ~~not~~as ~~intend~~inventory todeposits ~~sell~~ in the ~~future.~~consolidated ~~The~~balance ~~Company~~sheets. ~~had~~Upon ~~finished~~completion ~~goods~~of ~~inventory~~production onacceptance ~~hand~~by ofthe $6Company,~~261,697~~ ~~as of March 31, 2025~~ and ~~recorded~~passage ~~an inventory valuation allowance~~ of ~~$12,429~~title ~~related~~ to ~~three vehicles that~~ the Company, ~~does~~deposits ~~not~~are ~~intend~~reclassified to ~~sell in the future, resulting in a net~~ inventory ~~balance of $6,249,268 at March 31, 2025~~. The Company had ~~finished goods~~ inventory ondeposits ~~hand and a related inventory valuation allowance~~ of $67,~~428~~465,~~806~~129 and $126,~~429~~036,809 ~~respectively,~~ as of June 30, 2025 and December 31, 2024, ~~resulting~~respectively. inFunds aobtained for ~~net~~the Company's electric buses are deposited within inventory ~~balance~~deposits. Three vendors account for 100% of $6the inventory deposit balance at June 30,~~416,377~~ 2025.

Inventory Deposits—Certain of our vendors require the Company to pay upfront deposits before they commence manufacturing our vehicles and then require progress deposits through the production cycle and before the finished vehicles are shipped. These deposits are classified as inventory deposits in the consolidated balance sheets. Upon completion of production acceptance by the Company, and passage of title to the Company, deposits are reclassified to inventory. The Company had inventory deposits of $8,711,812 and $6,036,809 as of March 31, 2025 and December 31, 2024, respectively. Deposits paid to one vendor accounted for100% of the deposits outstanding at March 31, 2025.

Income Taxes—The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes.

Accounting for Uncertainty in Income Taxes—The Company evaluates its uncertain tax positions and will recognize a loss contingency when it is probable that a liability has been incurred as of the date of the financial statements and the amount of the loss can be reasonably estimated. The amount recognized is subject to estimate and management judgment with respect to the likely outcome of each uncertain tax position. The amount that is ultimately sustained for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount recognized. At ~~March~~June 3130, 2025 and December 31, 2024, respectively, management did not identify any uncertain tax positions.

Net Loss Per Share—Basic net loss per share is calculated by dividing the Company’s net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period. For the periods presented, the diluted loss per share and basic loss per share calculations are the same as the diluted loss per share calculation would be anti-dilutive.

Diluted net loss per share is calculated by dividing the Company’s net loss applicable to common stockholders by the diluted weighted average number of shares of common stock outstanding during the period. The diluted weighted average number of shares of common stock outstanding is the basic weighted number of shares of common stock adjusted for any potentially dilutive debt or equity securities. As of ~~March~~June 3130, 2025, 9977,~~672,482~~ 250 shares of the Company’s common stock were subject to issuance upon the exercise of stock options then outstanding and 1147,~~470,381~~ 039 shares of the Company’s common stock were subject to issuance upon the exercise of warrants then outstanding. The Company also has convertible notes that may potentially be converted into shares of the Company’s common stock, however, the conversion is based on several market factors, and as such, the number of shares of the Company’s common stock to be converted is not known.

Concentration of Credit Risk—The Company has credit risks related to cash and cash equivalents on deposit with a federally insured bank, as at times it exceeds the $250,000 maximum amount insured by the Federal Deposit Insurance Corporation (“FDIC”). Additionally, the Company may maintain cash and short-term securities invested at Arvest Bank, National Association (“Arvest”). Between FDIC and the Securities Investor Protection Corporation (“SIPC”) coverage, funds up to $750,000, which may include cash up to $500,000, are insured. In addition, Arvest provides excess insurance acquired by them from SIPC for unlimited per customer securities up to a $1 billion cap. There were no short-term securities invested at Arvest ~~Bank~~ at ~~March~~June 3130, 2025. Additionally, the Company had a concentration in accounts payable, as three vendors and two vendors made up greater than 10% individually, and 60% and 50% in the aggregate of the outstanding accounts payable balance as of June 30, 2025 and December 31, 2024, respectively.

Impairment of Long-Lived Assets—Long-lived assets, including property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company evaluates these assets to determine potential impairment by comparing the carrying amount to the undiscounted estimated future cash flows of the related assets. If the estimated undiscounted cash flows are less than the carrying value of the assets, the assets are written down to their fair value. There was no impairment of long-lived assets, or property and equipment, as of ~~March 31~~ June 30, 2025 and December 31, 2024, respectively.

Goodwill—Goodwill represents the excess of acquisition cost over the fair value of the net tangible and intangible assets acquired. Goodwill is not amortized and is subject to annual impairment testing on or between annual tests if an event or change in circumstance occurs that would more likely than not reduce the fair value of a reporting unit below its carrying value. In testing for goodwill impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it can conclude the assessment. If the Company concludes otherwise, the Company is required to perform a quantitative analysis to determine the amount of impairment, if any.

The Company has determined that it has three reporting ~~unit~~units, and based on both qualitative and quantitative analysis and based on management’s assessment ~~at March 31~~, ~~2025,~~ the Company recorded a non-cash impairment ~~charge~~ of $10,103,048 during the first quarter of 2025 on the Company's Consolidated Statements of Operations. No impairment ~~charge~~ was recorded for the year ended December 31, 2024 resulting in a goodwill balance of $10,103,048 on that date.

Research and Development—Costs incurred in connection with the development of new products and manufacturing methods are charged to operating expenses as incurred. Research and development costs were $98590,~~398~~ 121 and $70688,~~265~~519 during the three and six months ended ~~March~~June 3130, 2025, respectively. Research and development costs were $61,616 and $131,880 during the three and six months ended June 30, 2024, respectively.

Stock-Based Compensation—The Company accounts for employee stock-based compensation in accordance with the guidance of ASC 718, Stock-Based Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values. The fair value of the equity instrument is charged directly to compensation expense and credited to additional paid-in capital over the period during which services are rendered. Non-cash stock-based compensation expense of $~~546~~40,~~576~~ 479 and $1587,~~818,383~~ 055 was recorded for the three and six months ended ~~March 31~~June 30, 2025, respectively. Non-cash stock-based compensation expense of $35,045 and $1,853,428 ~~2024~~was recorded for the three and six months ended June 30, 2024, respectively.

Property and Equipment— Property and equipment are stated at cost, less accumulated depreciation. The Company provides for depreciation using the straight-line method over the estimated useful lives of the assets, which range from three to five years, except leasehold improvements, which are being amortized over the life of the lease term. Property and equipment qualify for capitalization if the purchase price exceeds $2,000. Major repairs and replacements, which extend the useful lives of equipment, are capitalized and depreciated over the estimated useful lives of the property. All other maintenance and repairs are expensed as incurred. See Note 3 - Property and Equipment, net.

Other Intangibles— Other intangibles are stated at cost, less accumulated amortization. The Company records amortization expense using the straight-line method over the estimated useful lives of these assets, which range from three to ten years. See Note 4 - Goodwill and Other Intangibles.

Leases—The Company accounts for leases in accordance with ASC 842, Leases (“ASC 842”). At the inception or modification of a contract, the Company determines whether a lease exists and classifies its leases as an operating or finance lease at commencement. Right-of-use ("ROU") assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent their obligation to make lease payments arising from the lease. See Note 1312 - Leases.

As most of the Company’s leases do not provide an implicit interest rate, the lease liability is calculated at lease commencement as the present value of unpaid lease payments using the Company’s estimated incremental borrowing rate. The incremental borrowing rate represents the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term and is determined using a portfolio approach based on information available at the commencement date of the lease.

The lease asset also reflects any prepaid rent, initial direct costs incurred, and lease incentives received. The Company’s lease terms may include optional extension periods when it is reasonably certain that those options will be exercised.

Leases with an initial expected term of 12 months or less are not recorded in the Company's consolidated balance sheets and the related lease expense is recognized on a straight-line basis over the lease term. For certain classes of underlying assets, the Company has elected to not separate fixed lease components from the fixed non-lease components.

Accounting Pronouncements Recently Adopted

ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure”

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which requires public entities to disclose information about their reportable segments' significant expenses and other segment items on an interim and annual basis. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as existing segment disclosures and reconciliation required under ASC 280 on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for the interim periods beginning after December 15, 2024, with early adoption permitted. The Company adopted the guidance in its Annual Report on Form 10-K for the year ended December 31, 2024. See Note 14 - Segment Information, for further information.

Recently Issued Accounting Pronouncements Not Yet Adopted

ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), which requires public entities, on an annual basis, to provide disclosure of specific categories in the reconciliation of the effective tax rate, as well as disclosure of income taxes paid, disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2023-09 and will adopt the guidance when it becomes effective on a prospective basis.

ASU No. 2024-03, “Income Statement (Subtopic 220-40): Disaggregation of Income Statement Expenses”

In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40): Disaggregation of Income Statement Expenses ("ASU 2024-03"), which requires additional information about certain expenses in the notes to the financial statements. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03 and will adopt the guidance when it becomes effective on a prospective basis.

3.	Property and Equipment, Net

Components of property and equipment, net, consist of the following as of ~~March~~June 3130, 2025 and December 31, 2024:

	March 31,			December 31,
	June 30,			December 31,
	2025			2024
Furniture and fixtures	$	125,620		$	90,641
Leasehold improvements		380,286			359,529
Machinery and equipment		388,~~467~~466			272,774
Electric buses		1,314,970			—
Vehicles		376,748			371,350
Test/Demo vehicles		30,685			30,685
Total property and equipment		12,~~301~~616,~~806~~775			1,124,979
Less accumulated depreciation		(~~590~~647,~~992~~062	)		(532,808	)
Net property and equipment	$	~~710~~1,~~814~~969,713		$	592,171

Depreciation expense was $5856,~~184~~ 071 and $3936,~~212~~659 for the three months ended ~~March~~June, 2025 31and 2024, respectively. Depreciation expense was $114,254 and $75,871 for the six months ended June, 2025 and 2024, respectively.

4. ~~Acquisition~~Goodwill and Other Intangibles

~~On October~~During ~~30, 2024,~~ the ~~Company~~first ~~entered~~quarter ~~into~~of a2025, ~~Membership Interest Purchase Agreement (~~the ~~“MIPA”)~~Company ~~with~~concluded ~~Maddox~~that ~~Industries, LLC,~~ a ~~Puerto~~triggering ~~Rico~~event ~~limited~~had ~~liability~~occurred ~~company~~as ~~(“Maddox~~a ~~Industries”),~~result ~~and~~of ~~Jason~~a ~~Maddox,~~decline ~~the sole member~~ of ~~Maddox Industries (~~the ~~“Seller”),~~Company's ~~pursuant~~stock toprice. ~~which~~Consequently, ~~subject to~~ the ~~terms~~Company ~~and~~conducted ~~conditions~~an ofimpairment ~~the~~test ~~MIPA,~~for the ~~Company~~first ~~purchased~~quarter ~~from the Seller all~~ of ~~the~~2025 ~~issued~~ and ~~outstanding~~recorded ~~membership~~a ~~interests~~non-cash inimpairment of ~~Maddox~~$10,103,048 ~~Industries~~for (the ~~“Maddox~~three ~~Acquisition”).~~months ~~The Maddox Acquisition closed on~~ended ~~December~~March 1831, ~~2024~~2025.

~~Unaudited~~The ~~Supplemental~~following ~~Pro~~table ~~Forma~~presents ~~Information~~a reconciliation of the carrying amount of goodwill for the six months ended June 30, 2025.

The following unaudited pro forma financial information presents the combined results of operations for the Company and gives effect to the Maddox Acquisition discussed above as if it had occurred on January 1, 2024. The pro forma financial information is presented for illustrative purposes only and is not necessarily indicative of the results of operations for the three months ended March 31, 2024 and that would have been realized if the Maddox Acquisition had occurred on January 1, 2024, nor does it purport to project the results of the combined entity in future periods. The pro forma financial information does not give effect to any anticipated integration costs related to the combined entities.

	*Total*
Goodwill as of December 31, 2023	$	9,583,836
Increase due to acquisitions		519,212
Goodwill as of December 31, 2024		10,103,048
Goodwill Impairment		(10,103,048	)
Goodwill as of June 30, 2025	$	-

	For the three months ended March 31,
	As of June 30, 2025
	2024
									Weighted average amortization period (in years)
Sales	$	1,504,644
	Gross carrying amount			Accumulated amortization			Net amount
Net loss	$	(4,091,852	)
Intangible assets:
Customer relationships	$	2,100,000		$	(374,932	)	$	1,725,068		2.46
Trade names and trademarks		1,900,000			(101,767	)	$	1,798,233		9.46
Intangible assets, net	$	4,000,000		$	(476,699	)	$	3,523,301

5. Goodwill and Other Intangibles

During the three months ended March 31, 2025, the Company concluded that a triggering event had occurred as a result of a decline of the Company's stock price. Consequently, the Company conducted an impairment test for the three months ended March 31, 2025, and recorded a non-cash impairment charge of $10,103,048 for the three months ended March 31, 2025.

Amortization expense was $222,500 for the three months ended March 31, 2025.

The following table presents a reconciliation of the carrying amount of goodwill for the three months ended March 31, 2025.

	Total
Goodwill as of December 31, 2023	$	9,583,836
Increase due to acquisitions		519,212
Goodwill as of December 31, 2024		10,103,048
Impairment charge		(10,103,048	)
Goodwill as of March 31, 2025	$	-

	As of March 31, 2025
								Weighted average amortization period (in years)
	Gross carrying amount		Accumulated amortization			Net amount
Intangible assets:
Customer relationships	$	2,100,000	$	(199,932	)	$	1,900,068		2.71
Trade names and trademarks		1,900,000		(54,267	)	$	1,845,733		9.71
Intangible assets, net	$	4,000,000	$	(254,199	)	$	3,745,801

	*As of December 31, 2024*
								*Weighted average amortization period (in years)*
	*Gross carrying amount*		*Accumulated amortization*			*Net amount*
Intangible assets:
Customer relationships	$	2,100,000	$	(24,932	)	$	2,075,068		2.96
Trade names and trademarks		1,900,000		(6,767	)	$	1,893,233		9.96
Intangible assets, net	$	4,000,000	$	(31,699	)	$	3,968,301

	Amortization expense
Remainder of 2025	$	667,500
2026	$	890,000
2027	$	865,068
2028	$	190,000
2029 and beyond	$	1,133,233

Amortization expense was $222,500 and $445,000 for the three and six months ended June 30, 2025, respectively.

6. Debt

	*Amortization expense*
Remainder of 2025	$	445,000
2026	$	890,000
2027	$	865,068
2028	$	190,000
2029 and beyond	$	1,133,233

Debt

Notes Payable

On July 15, 2022, the Company entered into an equipment financing agreement with Wells Fargo Bank, N.A. in connection with the purchase of facility grounds equipment. The $25,007 loan is payable over 36 months, beginning in August 2022, with monthly payments of $521. The balance of this note was $87,~~857~~294 as of ~~March 31~~June 30, 2025, of which $6,252 is classified as Notes Payable - current and $21,~~605~~042 is classified as Notes Payable - long term on the Company's consolidated balance sheets as of ~~March~~June 3130, 2025.

~~Effective~~On June 15, 2024, the Company entered into a premium financing agreement with First Insurance Funding to finance its directors' and officers' insurance coverages. The $232,067 loan is payable over nine months, beginning in July 2024, and bears interest at 8.25% with monthly payments of $24,093. ~~The~~This ~~balance of this~~ note, ~~including~~was ~~accrued~~paid ~~interest, was~~off ~~$23,929~~ as of ~~March~~June 3130, 2025.

~~Effective~~On ~~August~~June 2015, ~~2024~~2025, the Company entered into a premium financing agreement with AFCO Insurance Premium Finance to finance ~~insurance coverages other than~~ its directors' and officers' insurance coverages. The $~~417~~140,~~051~~400 loan is payable over ~~eleven~~ nine months, beginning in ~~September~~July 2024, and bears interest at 8.24% with monthly payments of $3914,~~493~~576. The balance of this note~~, including accrued interest,~~ was $~~155~~140,~~299~~ 400 as of ~~March~~June 3130, 2025.

On August 20, 2024, the Company entered into a premium financing agreement with AFCO Insurance Premium Finance to finance insurance coverages other than its directors' and officers' insurance coverages. The $417,051 loan is payable over eleven months, beginning in September 2024, and bears interest at 8.24% with monthly payments of $39,493. The balance of this note, including accrued interest, was $39,224 as of June 30, 2025.

Convertible Note

On January 18, 2024, the Company entered into a convertible promissory note agreement ("Note") for $1,000,000 with an unrelated third-party investor (the "Holder"). The origination fee of the Note was $99,000 and the maturity date of the Note was September 30, 2024. The Holder was entitled to convert the Note into common stock at the greater of $1.50 per share or at 90% of the share price of the Company's common stock on the maturity date. The Holder also had a security interest in the assets of the Company in the event of non-payment of the Note. In addition, the Holder received options to purchase ~~800~~80,000 ~~share~~shares of the Company's common stock at $115.5000 per share. ~~These options expire two years from the date of the Note. On May 6, 2024, the Note was cancelled and replaced with a short-term note.~~ During the third quarter of 2024, the short-term note was converted into ~~505~~50,~~051~~505 shares of common stock in satisfaction of the convertible note payable.

The Company has elected to measure the ~~Note~~remaining ~~and~~ options at fair value. In estimating the fair value of the Note, a Monte Carlo simulation model is applied. The required inputs include the current stock price, the risk-free rate and volatility of the common stock. The Note's fair value is classified as Level 2 under the fair value hierarchy as provided by ASC 820. In estimating the fair value of the options, the Black-Scholes Merton Model is used. The required inputs include the current stock price, the exercise price, the term of the options, the risk-free rate and the volatility of the common stock. The options' fair value is classified a Level 2 3 under the ~~air~~fair value hierarchy as provided by ASC 820. The fair valuation of the ~~Note and~~ options uses inputs other than quoted prices that are observable either directly or indirectly.

The net proceeds of $901,000 received by the Company from the issuance of the Note are bifurcated between the Note and the options. The amount allocated to the options is $431,405 which is the fair value of the options on the date of the Note. The remaining proceeds received are allocated to the Note. Under the fair valuation election, both the Note and options are remeasured to their respective fair values at the reporting date. Changes in fair values for the Note and options are recorded as an unrealized gain or loss on convertible note fair value in Other (Expense)/Income in the Company's consolidated statements of operations for the three months ended March 31, 2025. ~~As a result of this election, the Company recorded~~ ~~an unrealized loss $557,497 for the Note for the three months ended March 31, 2024 for the Note.~~ As a result of this election, the Company recorded an unrealized gain of $~~132~~1,~~412~~323 and an unrealized loss $1556,~~012,430~~ 174 for the ~~options for the~~ three and six months ended ~~March 31~~ June 30, ~~2025 and~~ 2024, respectively, for the ~~options, respectively~~Note.

The Company recorded an unrealized gain of $0 and $132,412 for the options for the three and six months ended June 30, 2025 for the options, respectively. The Company recorded an unrealized gain of $569,196 and an unrealized loss of $443,234 for the three and six months ended June 30, 2024, respectively, for the Options.

Amended and Restated Standby Equity Purchase Agreement ("A&R SEPA")

On October 31, 2024, the Company entered into A&R SEPA with YA II PN, Ltd. (the "Investor"). The A&R SEPA amends and restates in its entirety the standby equity purchase agreement, dated September 23, 2024, by and between the Company and the Investor (the “Original SEPA”).

Pursuant to the A&R SEPA, except for so long as there is a balance outstanding under the Promissory Notes (as defined below) and the Additional Promissory Notes (as defined below), the Company has the right, from time to time, until November 1, 2027, to require the Investor to purchase up to $25 million of shares of common stock, subject to certain limitations and conditions set forth in the A&R SEPA, by delivering written notice to the Investor. Pursuant to the A&R SEPA, the Investor advanced to the Company the principal amount of $3 million (the “Pre-Paid Advance”) in exchange for the Company’s issuance to the Investor of convertible promissory notes (the “Promissory Notes”) in two tranches, resulting in net proceeds (net of discounts and fees) to the Company of $2,635,500. The Company received the first tranche of the Pre-Paid Advance in the principal amount of $2 million on October 31, 2024 in exchange for the Promissory Note dated October 31, 2024 (the “EVTV-1 Promissory Note”), and the second tranche of the Pre-Paid Advance in the principal amount of $1 million on December 17, 2024 in exchange for the Promissory Note dated December 17, 2024 (the “EVTV-2 Promissory Note”). The Promissory Notes accrue interest on the outstanding principal balance at an annual rate equal to 0%, which will increase to an annual rate of 18% upon the occurrence of an Event of Default (as defined in the Promissory Notes) or a Registration Event (as defined in the Promissory Notes) for so long as such event remains uncured. Prior to the Company’s entry into the Supplemental Agreement (as defined below), the Promissory Notes were initially set to mature on November 13, 2025 and were convertible at a conversion price equal to the lower of (i) $221.~~1480~~4800 per share or (ii) 93% of the lowest daily volume weighted average price of the Company’s common stock on Nasdaq Stock Market LLC (“Nasdaq”) as reported by Bloomberg L.P. (“VWAP”) during the five consecutive trading days immediately preceding the conversion date (but no lower than the “floor price” then in effect, which was $03.~~3580~~5800 per share, subject to adjustment from time to time in accordance with the terms contained in the Promissory Notes). Pursuant to the terms of the Original SEPA, the Company issued 646,~~103~~ 410 shares of common stock to the Investor as a commitment fee.

During the first quarter of 2025, the obligation under the EVTV-2 Promissory Note in the principal amount of $1 million was fully satisfied through the conversion of the EVTV-2 Promissory Note into shares of the Company's common stock. As a result of this conversion, 1174,~~743,476~~348 shares of the Company's common stock were issued at a weighted average price of $05.5770. During the same quarter, the obligation under the EVTV-1 Promissory Note in the principal amount of $2 million was partially satisfied through the conversion of the EVTV-1 Promissory Note into shares of the Company's common stock. As a result of this conversion, 1,490,304 shares of the Company's common stock were issued at a weighted average price of $0.41. The remaining principal balance of the EVTV-1 Promissory Note on March 31, 2025 was $1,383,343.

~~The~~During ~~Company~~the ~~has~~same ~~elected~~quarter, the toobligation ~~measure~~under the EVTV-1 Promissory ~~Notes~~Note atwas ~~fair~~partially satisfied ~~value.~~through Inthe ~~estimating~~conversion of the ~~fair~~EVTV-1 ~~value~~Promissory Note into shares of the ~~Promissory~~Company's ~~Notes,~~common astock. ~~lattice~~As ~~model~~a isresult ~~applied.~~of ~~The~~this ~~required~~conversion, ~~inputs~~149,030 shares ~~include~~of the ~~current~~Company's common stock ~~price,~~were ~~the~~issued ~~term,~~at ~~the~~a ~~conversion~~weighted average price, ~~the~~of ~~risk-free~~$4.10. ~~rate~~During ~~and~~the ~~volatility~~second quarter of 2025, the ~~common~~obligation ~~stock.~~under ~~The~~the EVTV-1 Promissory ~~Notes'~~Note ~~fair~~was ~~values are~~partially ~~classified~~satisfied asthrough ~~Level~~the 2conversion ~~under~~of the ~~fair~~EVTV-1 ~~value~~Promissory ~~hierarchy~~Note asinto ~~provided~~shares byof ~~ASC~~the ~~820~~Company's common stock. As a result of this ~~election~~conversion, 56,144 shares of the Company's ~~recorded~~common anstock ~~unrealized~~were ~~gain~~ issued at a weighted average price of $~~745 for~~2.38. The remaining principal balance of the EVTV-1 Promissory Note ~~and~~on June an30, ~~unrealized~~2025, ~~gain~~was $1,250,000. As a result of ~~$350~~this conversion, realized gains ~~for~~of ~~the~~$4,145 ~~EVTV-2~~and ~~Promissory~~$4,145 ~~Note~~were recognized for the three and six months ended ~~March~~June 3130, 2025.

The Company has elected to measure the Promissory Notes at fair value. In estimating the fair value of the Promissory Notes, a lattice model is applied. The required inputs include the current stock price, the term, the conversion price, the risk-free rate and volatility of the common stock. The Promissory Notes' fair values are classified as Level 3 under the fair value hierarchy as provided by ASC 820. As a result of this election, the Company recorded an unrealized gain of $17 and $762 for the EVTV-1 Promissory Note for the three and six months ended June 30, 2025, respectively. The Company also recorded an unrealized gain of $0 and $350 for the EVTV-2 Promissory Note for the three and six months ended June 30, 2025, respectively.

Supplemental Agreement to A&R SEPA

On February 24, 2025, the Company entered into a supplemental agreement, dated February 24, 2025 (the “Supplemental Agreement”), with the Investor, which amends and supplements the A&R SEPA to: (i) provide for the advancement by the Investor to the Company, subject to the satisfaction of certain conditions as set forth in the Supplemental Agreement, of $5 million under the A&R SEPA (the “Additional Pre-Paid Advance”), to be evidenced by convertible promissory notes (the “Additional Promissory Notes”) in two tranches, (ii) amend the maturity date for the EVTV-1 Promissory Note to March 9, 2026, and (iii) amend the floor price for the Note EVTV-1 to $0.~~0713~~7130 per share.

The Additional Promissory Notes accrue interest on the outstanding principal balance at an annual rate equal to 5%, which will increase to an annual rate of 18% upon the occurrence of an Event of Default (as defined in the Additional Promissory Notes) or a Registration Event (as defined in the Additional Promissory Notes) for so long as such event remains uncured. The Additional Promissory Notes will mature on March 9, 2026, which may be extended at the option of the Investor. The Additional Promissory Notes are convertible at a conversion price equal to the lower of (i) $110.00 per share or (ii) 93% of the lowest daily VWAP during the five consecutive trading days immediately preceding the conversion date (but no lower than the “floor price” then in effect, which is $0.~~0713~~7130 per share, subject to adjustment from time to time in accordance with the terms contained in the Additional Promissory Notes).

The first tranche of the Additional Pre-Paid Advance was disbursed on February 25, 2025 in the principal amount of $3 million (with net proceeds to the Company of approximately $2.7 million after deducting discounts and fees) as evidenced by an Additional Promissory Note issued by the Company to the Investor on February 24, 2025 (the “EVTV-3 Additional Promissory Note”). The second tranche of the Additional Pre-Paid Advance will be in the principal amount of $2 million and advanced by the Investor upon the Company obtaining approval of its stockholders for the issuance of shares in excess of the Exchange Cap (as defined in the A&R SEPA). The Company’s stockholders approved the issuance of shares in excess of the Exchange Cap at a special meeting of the Company’s stockholders held on May 1, 2025. At the closing of the second tranche of the Additional Pre-Paid Advance, the Investor will advance to the Company the principal amount of such tranche, less a discount in the amount equal to 5% of the principal amount of such tranche netted from the purchase price due and structured as an original issue discount.

The ~~Company~~second ~~has~~tranche ~~elected~~of ~~to measure~~ the Additional ~~Promissory~~Pre-Paid ~~Notes at~~Advance ~~fair~~in ~~value.~~the Inprincipal ~~estimating~~amount ~~the~~of ~~fair~~$2 ~~value~~million of(with ~~the~~net ~~Additional~~proceeds ~~Promissory~~of ~~Notes,~~approximately a$1.8 ~~lattice~~million ~~model~~after isdeducting ~~applied.~~discounts ~~The~~and ~~required~~fees) ~~inputs~~was ~~include~~disbursed to the ~~current~~Company ~~stock~~on May ~~price~~7, 2025 (the ~~term,~~"EVTV-4 Additional Promissory Note"). During the ~~conversion~~second ~~price~~quarter of 2025, the ~~risk~~obligation under the EVTV-~~free~~4 ~~rate~~Additional ~~and~~Promissory ~~volatility~~Note ofin the ~~common~~principal ~~stock.~~amount ~~The~~of ~~Promissory~~$2 ~~Notes' fair~~million ~~values~~was ~~are~~partially ~~classified~~satisfied asthrough ~~Level~~the 2conversion ~~under~~of the ~~fair~~EVTV-4 ~~value~~Additional ~~hierarchy~~Promissory asNote ~~provided~~into byshares ~~ASC~~of ~~820~~the Company's common stock. As a result of this ~~election~~conversion, 853,275 shares of the Company's ~~recorded~~common anstock ~~unrealized~~were ~~loss~~issued at a weighted average price of $~~417,300 for~~1.77. The remaining principal balance of the EVTV-34 Additional Promissory Note on June 30, 2025, was $500,000. A realized loss of $80,909 was recognized as a result of this conversion for the three months ended ~~March~~June 3130, 2025.

The ~~following~~Company ~~table~~has ~~depicts~~elected to measure the ~~future~~Additional ~~annual~~Promissory ~~minimum~~Notes ~~payments~~at fair value. In estimating the fair value of the Additional Promissory Notes, a lattice model is applied. The required inputs include the current stock price, the term, the conversion price, the risk-free rate and volatility of the Company's ~~outstanding~~common ~~debt~~stock. The Additional Promissory Notes' fair values are classified as Level 3 under the fair value hierarchy as provided by ASC 820. As a result of this election, the Company recorded an unrealized loss of $27,200 and $444,500 for the EVTV-3 Additional Promissory Note for the three and six months ended ~~March~~June 30, 2025, respectively. The Company also recorded 31an unrealized gain of $262,961 for the EVTV-4 Additional Promissory Note for the three months ended June 30, 2025:.

	Amount
Remainder of 2025	$	186,756
2026		4,383,343
Total Payments	$	4,570,099

The following table depicts the future annual minimum payments of the Company's outstanding debt as of June 30, 2025:

7. Stockholders’ Equity

	*Amount*
Remainder of 2025	$	1,380,073
2026		3,562,471
Total Payments	$	4,942,544

~~The Company has 5,000,000 authorized shares of its preferred stock, par value $0~~6.~~00001~~ ~~per~~Stockholders’ ~~share, on March 31, 2025 and December 31, 2024. There was no outstanding shares of preferred stock on March 31, 2025 and December 31, 2024.~~Equity

The Company has ~~350~~5,000,000 authorized shares of its ~~common~~preferred stock, par value $0.00001 per share, ofon June ~~which 23~~30,~~106,392~~ 2025 and December 1931,~~872,612~~ ~~shares~~2024. ofThere ~~the~~was ~~Company's~~no ~~common~~outstanding ~~stock were~~shares ~~outstanding~~of preferred stock on ~~March 31~~June 30, 2025 and December 31, 2024~~, respectively~~.

The Company has 350,000,000 authorized shares of its common stock, par value $0.00001 per share, of which 3,220,058 and 1,987,262 shares of the Company's common stock were outstanding on June 30, 2025 and December 31, 2024, respectively.

A&R SEPA

On September 23, 2024, the Company entered into the Original SEPA, which was amended and restated pursuant to the A&R SEPA on October 31, 2024. Pursuant to the A&R SEPA, except for so long as there is a balance outstanding under the Promissory Notes and the Additional Promissory Notes ~~(as defined below),~~ and subject to certain limitations and conditions set forth therein, the Company has the right, but not the obligation, to sell to the Investor, and the Investor agreed to purchase from the Company, an aggregate amount of up to $25,000,000 of shares of the Company’s common stock at the Company's request, from time to time, until November 1, 2027. See Note 6 – Debt.

87. Stock Warrants

The Company’s outstanding warrants as of ~~March~~June 3130, 2025 are summarized as follows, and all were exercisable at that date.

	Number of Shares		Exercise Price		Remaining Contractual Life (years)
Outstanding warrants expiring May 7, 2026		~~958~~95,~~334~~834	$	20200.00		10.1085
Outstanding warrants expiring September 11, 2026		~~512~~51,~~047~~205	$	116.6660		1.4621
Outstanding warrants on March 31, 2025		1,470,381	$	12.79		0.91
Outstanding warrants at June 30, 2025		147,039

December 2020 Warrants

The warrants issued pursuant to ~~that~~a ~~certain~~securities ~~Securities~~purchase ~~Purchase Agreement~~agreement, dated as of December 24, 2020, that the Company entered into with certain institutional and accredited investors and pursuant to which, among other things, the Company sold and issued, and the investors purchased, shares of the Company’s common stock and related warrants to purchase additional shares of the Company’s common stock in a series of two closings, contain a call provision whereby the Company, after the 13-month anniversary of the issuance date, and if the volume weighted average price of the common stock for such date exceeds four times the exercise price of the warrants for 20 consecutive trading days, may call the warrants that have not previously been exercised, and the warrant holders have ten trading days within which to exercise before the warrants may be cancelled. From among these warrants, warrants for 121,~~833~~ 283 shares of common stock expired in 2023, warrants for ~~431~~43,~~250~~ 125 shares of common stock expired on January 28, 2025, and warrants for ~~958~~95,~~334~~ 834 shares of common stock will expire on May 7, 2026.

September 2024 Warrants

On September 12, 2024, the Company entered into securities purchase agreements with four private investors with respect to the private placement of an aggregate of ~~512~~51,~~047~~ 205 shares of the Company’s common stock at a price of $116.6660 per share and warrants to purchase up to an aggregate of ~~512~~51,~~047~~ 205 shares of the Company's common stock. The Company received aggregate gross cash proceeds from this private placement (exclusive of proceeds from any future exercise of the warrants) of $850,000. The warrants have a term of two years and are exercisable at any time after September 16, 2024, at an exercise price of $116.6660 per share. The warrants expire on September 11, 2026.

98. Stock Options and Restricted Shares

The outstanding options at ~~March~~June 3130, 2025 consisted of the following:

						Weighted
						Average
						Remaining
	Number of			Exercise		Contractual Life
	Shares			Price		(years)
Outstanding at December 31, 2024		5564,~~641,252~~126		$	~~2.59~~		~~5.33~~
Options Granted at $0.25 Exercise Price		4,150,000		$	0.25		10.0
Options Granted at $2.50 Exercise Price		415,000		$	2.50
Options Expired at $2.65 Exercise Price		(2,778	)	$	2.65
Options Expired at $26.50 Exercise Price		(277	)	$	26.50
Options Expired at $2.11 Exercise Price		(13,770	)	$	2.11
Options Expired at $21.10 Exercise Price		(1,377	)	$	21.10
Options Expired at $2.44 Exercise Price		(100,000	)	$	2.44
Options Expired at $24.40 Exercise Price		(10,000	)	$	24.40
Options forfeited at $2.65 Exercise Price		(2,222	)	$	2.65
Options forfeited at $26.50 Exercise Price		(222	)	$	26.50
Outstanding at March 31, 2025		9,672,482
Options Granted at $2.10 Exercise Price		10,000		$	2.10
Outstanding Options at $2.00 Exercise Price		250,000		$	2.00		6.77
Outstanding at June 30, 2025		977,250
Outstanding Options at $2.40 Exercise Price		90,893		$	2.40		6.77
Outstanding Options at $20.00 Exercise Price		25,000		$	20.00		6.52
Outstanding Options at $9.00 Exercise Price		256,750		$	9.00		5.73
Outstanding Options at $24.00 Exercise Price		9,090		$	24.00		6.52
Outstanding Options at $26.20 Exercise Price		6,750		$	26.20		3.07
Outstanding Options at $90.00 Exercise Price		25,675		$	90.00		5.48
Outstanding Options at $2.10 Exercise Price		588,495		$	2.10		8.28
Outstanding Options at $262.00Exercise Price		675		$	262.00		2.82
Outstanding Options at $2.11 Exercise Price		1,364,594		$	2.11		8.97
Outstanding Options at $21.00 Exercise Price		58,850		$	21.00		8.03
Outstanding Options at $2.66 Exercise Price		25,000		$	2.66		8.87
Outstanding Options at $21.10 Exercise Price		136,460		$	21.10		8.72
Outstanding Options at $1.50 Exercise Price		800,000		$	1.50		1.8
Outstanding Options at $26.60 Exercise Price		2,500		$	26.60		8.62
Outstanding Options at $2.75 Exercise Price		2,000,000		$	2.75		1.85
Outstanding Options at $15.00 Exercise Price		80,000		$	15.00		1.55
Outstanding Option at $1.76 Exercise Price		100,000		$	1.76		9.24
Outstanding Options at $27.50 Exercise Price		200,000		$	27.50		1.60
Outstanding Options at $1.49 Exercise Price		20,000		$	1.49		9.24
Outstanding Option at $17.60 Exercise Price		10,000		$	17.60		8.99
Outstanding Options at $2.20 Exercise Price		20,000		$	2.20		9.23
Outstanding Options at $14.90 Exercise Price		2,000		$	14.90		8.99
Outstanding Options at $0.25 Exercise Price		4,150,000		$	0.25		10.0
Outstanding Options at $22.00 Exercise Price		2,000		$	22.00		8.98
Outstanding at March 31, 2025		9,672,482		$	1.59		7.14
Outstanding Options at $2.50 Exercise Price		415,000		$	2.50		9.8
Options Granted at $2.10 Exercise Price		10,000		$	2.10		8.5
Outstanding at June 30, 2025		977,250

At ~~March~~June 3130, 2025 9944,~~252,620~~ 026 of the outstanding stock options were exercisable. Unrecognized compensation for unvested shares was $161,833.

On March 10, 2025, the Compensation Committee ~~(the "Compensation Committee") of the Company's Board of Directors (the "Board")~~ granted the non-employee directors and certain executives and consultants options to purchase 4415,~~150,~~000 shares of common stock at an exercise price of $02.2550 per share, of which 3385,~~850,~~000 of these options vested immediately upon grant and expire on the tenth anniversary of the grant date. The remaining ~~300~~30,000 options vest on the one-year anniversary of the grant date and expire on the tenth anniversary of the grant date.

~~As of~~On ~~March~~May 3121, 2025, the Compensation Committee (the ~~outstanding~~"Compensation ~~stock~~Committee") of the Company's Board of Directors (the "Board") granted a consultant options ~~had~~to ~~intrinsic~~purchase ~~value~~10,000 shares of common stock at an exercise price of $122.10 per share,~~035~~ all of which vested immediately upon grant and expire on the tenth anniversary of the grant date.

As of June 30, 2025, the outstanding stock options had intrinsic value of $0.

Performance Options

On February 28, 2024, the Company issued options to an external party to purchase 2200,000~~,000~~ shares of the Company's common stock at an exercise price of $227.7550 per share, contingent upon achieving certain sales targets. On ~~September~~ June 30, ~~2024~~2025, the sales targets were not met and therefore, no compensation expense was recorded for the three and six months ended ~~March~~June 3130, 2025, respectively. The Company does not believe that the criteria will be met. These options expire on February 5, 2027.

Restricted Shares

In November 2023, the Company awarded 65,660 restricted shares to a vendor that will vest over a six-month period in exchange for marketing services to be provided over the same period. As a result, the Company recorded stock compensation expense of $0 and $58,671 during the three months ended March 31, 2025, and 2024, respectively.

109. Related Party Transactions

The Company has entered into lease agreements with SRI Professional Services, Incorporated (“SRI”), pursuant to which the Company leases equipment used in connection with the operation of its business (the “SRI Equipment Leases”). Phillip W. Oldridge, the Company’s Chief Executive Officer and Chairman of the Board, serves as an executive officer and a member of the board of directors of SRI. Two of the SRI Equipment Leases provide for the leasing of two vehicles that commenced on January 1, 2020 and the combined rent under such leases is $3,880 per month, and a third SRI Equipment Lease provides for a trailer lease that commenced on December 1, 2019, under which the rent is $3,891 per month. The total monthly payment obligation of the Company under the SRI Equipment Leases is $7,771. As a result of the SRI Equipment Leases, the Company recorded rent expense of $23,312 and $46,624 for the three and six months ended ~~March~~June 3130, 2025, respectively.

The Company has entered into a commercial lease agreement (the “ABCI Office Lease”) with Alpha Bravo Charlie, Inc. (“ABCI”) that commenced on April 1, 2020, for the lease of office space in Porterville, California. The monthly rent for this facility is approximately $5,000. Phillip W. Oldridge, the Company’s Chief Executive Officer and Chairman of the Board, is a director of ABCI. The Company recorded rent expense of $15,000 and $30,000 for the three and six months ended ~~March~~June 3130, 2025, respectively, in connection with the ABCI Office Lease.

The Company incurred $37,500 and $75,000 for the three and six months ended June 30, 2025, respectively, of costs related to engineering consulting services from 42Motorsports LTD, the owner of which is a sibling of the Company's Chief Executive Officer and Chairman of the Board ~~for the three months ended March 31, 2025~~.

InThe ~~connection~~Company ~~with~~also expensed $45,000 and $90,000 for the ~~Maddox~~three ~~Acquisition~~and six months ended June 30, 2025, respectively, to Shell Castle LLC, an entity owned by Jason Maddox for services rendered as ~~discussed~~President and Interim Chief Financial Officer of the Company in ~~Note~~lieu ~~4 -~~of ~~Acquisition~~wages. In addition, the Company ~~recorded~~also aexpensed $145,~~195~~000 and $90,~~963~~000 ~~receivable~~for ~~that~~the ~~was~~three ~~due~~and ~~from~~six ~~Maddox~~months ~~Defense~~ended June 30, 2025, respectively, to Met Consulting LLC, an entity ofowned ~~which~~by ~~Jason~~Elgin ~~Maddox, the~~Tracy ~~President~~for services rendered as Chief Operating Officer of the Company, isin ~~the~~lieu ~~sole~~of ~~stockholder~~wages.

~~The~~All ~~Company~~revenue ~~also~~earned ~~paid $45,000 to an entity owned by Jason Maddox~~ for ~~services~~the ~~rendered~~three ~~as President~~ and ~~Interim~~six ~~Chief~~months ~~Financial~~ended June ~~Officer~~30, of2025 by the Company's inmedical ~~lieu~~supplies ofsegment ~~wages.~~was Infrom ~~addition~~Maddox Defense, ~~the Company also paid $45~~Inc.,~~000~~ toa ancompany ~~entity~~ owned by ~~Elgin~~Jason ~~Tracy~~Maddox, ~~for~~President ~~services~~and ~~rendered~~Interim as Chief ~~Operating~~Financial Officer of the Company ~~in lieu of wages~~.

~~11.~~The ~~Commitments~~Company also maintains a procurement contract with EVTV Canada, a related party whereby one of its officers holds a significant number of shares in the Company.

~~Other~~10. ~~Agreements~~Commitments

~~On December~~See ~~31,~~Note 2021, the Company entered into employment agreements with Phillip W. Oldridge (the “Oldridge Agreement”), its Chief Executive Officer, and with Susan M. Emry (the “Emry Agreement”), its then Executive Vice President. According to the Oldridge Agreement, effective as of March 1, 2021, Mr. Oldridge will receive an annual base salary of $300,000, payable in semi13 -~~monthly~~ ~~installments~~Leases consistent with the Company’s payroll practices. Mr. Oldridge will also receive participation in medical insurance, dental insurance, and the Company’s other benefit plans. Under the Oldridge Agreement, Mr. Oldridge will also receive an amount equal to 5% of the net income of the Company on an annual basis and will be eligible for afurther ~~bonus at the sole discretion of the Board~~information. The Oldridge Agreement also provides for an automobile monthly allowance of $1,500. Mr. Oldridge’s employment shall continue until terminated in accordance with the Oldridge Agreement. If Mr. Oldridge is terminated without cause or if he terminates his employment for good reason, Mr. Oldridge will be entitled to receive (i) one-year of base salary, (ii) reimbursement of reimbursable expenses in accordance with the Oldridge Agreement, (iii) any bonus that would have been payable within the twelve months following the date of termination, and (iv) the value of any accrued and unused paid time off as of the date of termination. There are no future minimum payments under the terms of the Oldridge Agreement as Mr. Oldridge has the right to terminate the Oldridge Agreement without any contractual payments other than what has been stated in the Oldridge Agreement. According to the Emry Agreement, effective on January 1, 2022, Mrs. Emry would receive an annual base salary of $200,000 and was eligible for a bonus at the sole discretion of the Board. Mrs. Emry would also receive participation in medical insurance, dental insurance, and the Company’s other benefit plans. The Emry Agreement provided that Mrs. Emry’s employment would continue until terminated in accordance with the Emry Agreement. If Mrs. Emry was terminated without cause or if she terminated her employment for good reason, Mrs. Emry was entitled to receive (i) one-year of base salary, (ii) reimbursement of reimbursable expenses in accordance with the Emry Agreement, and (iii) the value of any accrued and unused paid time off as of the date of termination. Ms. Emry terminated her role as Executive Vice President of the Company effective as of October 15, 2024.

On March 28, 2023, the Company entered into an agreement with Berthaphil, Inc. ("Berthaphil") to sublease approximately 3,600 square yards of a warehouse building based in the Clark Freeport Zone in the Philippines (the "Berthaphil Sublease"). The term of the lease is two years and two months with a turnover date of July 1, 2023 and a rental commencement of September 1, 2023. The Company had originally intended to use the leased space as a production facility as it seeks to expand its business presence in that region and the United States. However, in December 2024, the Company decided not to use the leased space for its original purpose. See Note 13 - Leases for further information.

1211. Contingencies

Except as set forth below, we know of no material, existing or pending, legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder of more than 5% of our common stock, or any associate of any of the foregoing persons, is an adverse party or has a material interest adverse to our interest.

GreenPower Litigation

On December 17, 2019, GreenPower Motor Company Inc., a public company incorporated under the laws of British Columbia (“GreenPower”), of which Phillip W. Oldridge, the Company’s Chief Executive Officer and Chairman of the Board, previously served as a senior officer and a member of its board of directors, filed a notice of civil claim, captioned GreenPower Motor Company Inc. v. Phillip Oldridge et al., Action No. S-1914285, in the Supreme Court of British Columbia, against Phillip Oldridge, his trust, Envirotech Drive Systems, Inc. and certain other companies affiliated therewith. On February 2, 2020, the Company and the other companies affiliated therewith named in the notice of civil claim filed a response to the civil claim in which they denied certain of the allegations. Fact discovery, through document disclosure and examinations for discoveries, in this matter remains ongoing. The Company believes it has meritorious defenses against GreenPower's claims and intends to vigorously defend itself against those claims.

On or about July 18, 2021, GreenPower and GP GreenPower Industries Inc. (collectively “the GreenPower entities”), filed a counterclaim against David Oldridge, Phillip Oldridge, the Company and other companies in Supreme Court of British Columbia Action No. S207532. The pleadings in this lawsuit have not closed and the Company intends to vigorously defend itself against the counterclaim.

On February 8, 2022, GreenPower Motor Company, Inc., a Delaware corporation, and GreenPower Motor Company Inc., a Canadian corporation, filed a complaint captioned GreenPower Motor Company, Inc. v. Phillip Oldridge, et al., Case No. 5:22-cv-00252 in the United States District Court for the Central District of California. The complaint’s allegations are centered around the same assertions in the pending Canadian litigation.

On May 10, 2022, the Company, together with other defendants, filed a Motion to Dismiss and/or Stay the lawsuit in the United States District Court for the Central District of California pending the outcome of the Canadian litigation. The Court issued stay of this case pending resolution of parallel litigation in Canada between similar parties. GreenPower and defendants have agreed that the U.S. GreenPower case will not proceed while Canadian litigation is pending. The Company believes that it has meritorious defenses against the Greenpower entities' claims and intends to vigorously defend itself against such claims.

1312. Leases

Operating leases

The Company has active operating lease arrangements for office space and warehouse facilities. The Company is typically required to make fixed minimum rent payments relating to its right to use the underlying leased assets. Although these leases have terms that are either month-to-month or terms that are one year or less (with renewal options), the Company concluded ~~in the fourth quarter of 2023~~ that the term renewal options are reasonably certain to be exercised., Asand ~~a result of changes in certain circumstances related to some of~~ the Company~~'s short-term~~ ~~leases,~~classified ~~the Company was required to classify~~ such leases as operating leases in accordance with the provisions of ASC 842. ~~Therefore, the Company recognized operating lease liabilities with corresponding ROU assets based on the present value of the minimum rental payments of such leases.~~

On April 1, 2025, the Company entered into a three-year sub-lease arrangement with Maddox Defense (with renewal options), an entity of which Jason Maddox, the President and Interim Chief Financial Officer of the Company, is the sole stockholder, to lease a facility in Houston, Texas for its medical supplies operations. This lease is treated as an operating lease in accordance with the provisions of ASC 842. Therefore, the Company recognized operating lease liabilities with corresponding ROU assets based on the present value of the minimum rental payments of such leases.

On March 28, 2023, the Company entered into the Berthaphil Sublease with Berthaphil to sublease approximately 3,600 square yards of a warehouse building based in the Clark Freeport Zone in the Philippines. The term of the Berthaphil Sublease is two years and two months with a turnover date of July 1, 2023 (the "turnover date") and a rental commencement of September 1, 2023. However, the warehouse building was not available for use to the Company until the early part of the fourth quarter of 2023. Therefore, the commencement date was deferred until the fourth quarter of 2023, which is when the Company was given access to use the warehouse building. There was a grace period of two months for rental payments starting from the turnover date. The monthly rent for the first year is $15,000, escalating to $15,750 for the second year and $16,530 for the remaining term. In addition to the monthly rent, the Company is required to pay an additional 5% of the monthly rent as common area maintenance costs. The Berthaphil Sublease may be renewed for an additional period that is mutually agreed upon subject to certain terms and conditions. The Company intended to use the leased space as a production facility as it sought to expand its business presence in the region and the United States. The Company accounted for this lease as an operating lease under ASC 842 and recorded an operating lease liability and a corresponding ROU asset for this lease. However, the Company decided not to use this facility for its original intended purpose and recorded a full impairment on its ROU asset in December 2024.

On July 1, 2024, the Company entered into a month-to-month lease contract ~~with Southern Management Corporation~~ to lease a residence in Osceola, Arkansas for the purpose of housing certain of the Company's employees. The monthly lease cost is $3,000. This lease is treated as a short-term lease ~~expense~~.

On August 26, 2024, the Company entered into a one-year lease contract ~~with 120 Park SD, LLC~~ to lease a location in Manalapan, New Jersey with the purpose of servicing the Company's New Jersey customers. The monthly lease cost is $2,900 and at the end of the one-year lease term, the lease converts into a month-to-month arrangement. This lease is treated as a short-term lease ~~expense~~.

The Company's lease agreements do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach to derive an appropriate incremental borrowing rate. The Company benchmarked itself against other companies of similar credit ratings and comparable credit quality and derived an incremental borrowing rate to discount each of its lease liabilities based on the remaining lease terms.

ROU assets at December 31, 2025 were $73,590. Short-term and long-term operating lease liabilities were $205,156 and $0 at March 31, 2025, respectively.

Quantitative information regarding the Company’s leases is as follows:

	Three Months Ended						Six Months Ended
	March 31,
	June 30,						June 30,
	2025			2024			2025			2024
Lease expenses
Operating lease expenses	$	3899,~~312~~863		$	89,268		$	138,175		$	178,536
Short-term lease expenses		4650,~~826~~747			257,~~171~~886			97,573			33,057
Total lease cost	$	85150,~~138~~610		$	~~114~~97,~~439~~154		$	235,748		$	211,593
Other information
Cash paid for the amounts included in the measurement of lease liabilities for operating leases:
Operating cash flows	$	3897,~~312~~402		$	85,562		$	135,714		$	171,124
Weighted-average remaining lease term (in years):
Operating leases		02.5018			1.4525			2.18			1.25
Weighted-average discount rate:
Operating leases		14	%		14	%		14	%		14	%

Future minimum payments under operating leases are as follows:

Remainder of 2025	$	76291,~~624~~015
Total payments	$	76,624
2026	$	243,454
2027	$	253,192
2028	$	85,217
Total payments	$	872,878

1413. Segment Reporting

The Chief Operating Decision Maker ~~("CODM")~~ is the Chief Executive Officer ~~("CEO")~~, who reviews the segment operating results in order to allocate resources and assess performance.

The Company has identified three segments:

(1) Electric vehicles,

(2) Medical supplies and

(3) Drones

The ~~Electric~~electric vehicle segment consists of sales of commercial electric vehicles to customers. A significant portion of such sales are through state subsidized or funded programs. The medical supplies segment consists solely of sales to Maddox Defense, a related party based on an agreement to supply refurbished medical gowns on a cost-plus pricing arrangement. Through the Company's drone operations, it is also diversifying its portfolio of assets by engaging in the future production and supply of drones that will be used in the agricultural environment. Currently, activity within the Drones segment is limited to start up expenses and research and development activities.

The table below summarizes the operating results of the Company's segments for the three and six months ended June 30, 2025:

	Electric vehicles			Medical Supplies			Drones			Total
Sales, net	$	~~373~~(25,~~300~~237	)	$	~~217~~1,~~267~~072,266		$	-		$	~~590~~1,~~567~~047,029
Operating loss	$	(133,~~250~~274,~~409~~582	)	$	(~~388~~951,~~237~~437	)	$	(93573,~~027~~607	)	$	(134,~~731~~799,~~673~~626	)
Interest income (expense), net											~~10,754~~303
Unrealized loss on financial instruments at fair value											(~~283~~290,~~793~~144	)
Other expense											(31,669	)
Realized loss on conversion of convertible notes											(76,764	)
Other expense											19,494
Income tax expense											-
Net loss										$	(145,~~036~~146,~~381~~737	)

15. Subsequent Events

	*Six months ended June 30th , 2025*
	*Electric vehicles*			*Medical Supplies*			*Drones*			*Total*
Sales, net	$	348,063		$	1,289,532		$	-		$	1,637,595
Operating loss	$	(16,524,991	)	$	(1,339,675	)	$	(666,634	)	$	(18,531,300	)
Interest income (expense), net											11,056
Unrealized loss on financial instruments at fair value											(573,937	)
Realized loss on conversion of convertible notes											(76,764	)
Other expense											(12,173	)
Income tax expense											-
Net loss										$	(19,183,118	)

14.

Subsequent Events

The Company evaluates subsequent events that have occurred after the balance sheet date but before the consolidated financial statements are issued. There are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements, and (2) non-recognized, or those that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to that date.

~~On May~~Reverse ~~8, 2025, the Company, through its subsidiary, AG Drones Inc. ("AG Drones"), entered into a Consulting and Manufacturing Agreement with a U.S. drone manufacturer for the manufacture of a U.S.~~1-made heavy lift drone and that, following delivery of the drone and its associated intellectual property, Envirotech plans to open its previously announced drone manufacturing facility in the United States. The Consulting and Manufacturing Agreement provides for ~~the design and build of a heavy lift U.S.~~-~~made~~10 ~~electric~~stock unmanned aerial system ("UAS") for AG Drones in accordance with AG Drones' detailed specifications. Upon delivering the drone to AG Drones, the design-manufacturer will also transfer all accompanying intellectual property to AG Drones in connection with which Envirotech intends to open its U.S. drone manufacturing facility. The delivery of the heavy lift agricultural drone to AG Drones is part of the Company's recent plan of creating an electric drone division. The initial heavy lift drone is purpose-built for the agricultural market, with advanced spraying and mapping functionality, U.S. made, with no reliance on Chinese parts, AG Drones will be National Defense Authorization Act ("NDAA") compliant.split

On ~~May~~August 156, 2025 (the “Split Effective Time”), the Company ~~signed~~effected a ~~non-binding~~reverse ~~letter~~stock split of ~~intent to~~its ~~acquire~~Common ~~the~~Stock ~~assets~~at a ratio of ~~Kymera~~1-for-10 (the “Reverse Stock Split”). Pursuant to the Reverse Stock Split, aevery ~~manufacturer~~10 shares of ~~marine~~Common ~~craft. The~~Stock ~~Company~~issued ~~intends~~and ~~for~~outstanding ~~the~~immediately ~~business~~prior to ~~serve~~the asSplit ~~the~~Effective ~~foundation~~Time were automatically combined into one issued and outstanding share of ~~it’s~~Common ~~new~~Stock ~~marine~~without ~~division.~~any Aschange ~~planned,~~in the ~~Company~~par ~~intends~~value toper ~~enter~~share or the ~~electric~~total ~~marine~~number ~~mobility~~of ~~space~~authorized ~~with~~shares. Proportional adjustments were made to the ~~acquisition,~~exercise ~~reinforcing~~price ~~its~~and ~~long-term~~number ~~vision~~of toshares ~~deliver~~of ~~next-generation,~~Common ~~zero-emission~~Stock ~~transportation~~issuable ~~across~~upon ~~land,~~exercise ~~air,~~of the Company's outstanding stock options and ~~sea~~warrants and the shares reserved for issuance under the Company’s 2017 Equity Incentive Plan. The ~~acquisition~~Company’s iscommon ~~planned~~stock tobegan ~~take~~trading ~~place~~on ~~during~~a post-split basis on the ~~second~~Nasdaq ~~quarter~~Capital ofMarket on August 8, 2025.

Appointment of Jason Maddox as a Class II Director

On August 5, 2025, the board of directors (the “Board”) of Envirotech Vehicles, Inc., a Delaware corporation (the “Company”), approved the appointment of Jason Maddox as a Class II director of the Company effective as of August 6, 2025, to serve until the 2025 Annual Meeting of Stockholders of the Company. Mr. Maddox has not been appointed to any committees of the Board.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and the results of operations should be read in conjunction with the unaudited consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q (“Quarterly Report”) and the audited financial statements and notes thereto included in our Annual Report on Form 10-K filed with the SEC on ~~March~~ April 15, 2025. This discussion contains forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from those expressed or implied by such forward-looking statements. These risks, uncertainties, and other factors include, among others, those identified under the “Special Note Regarding Forward-Looking Statements” above in this Quarterly Report.

Overview

We are a provider of purpose-built zero-emission electric vehicles focused on reducing the total cost of vehicle ownership and helping fleet operators unlock the benefits of green technology. We serve commercial and last-mile fleets, school districts, public and private transportation service companies and colleges and universities to meet the increasing demand for light to heavy-duty electric vehicles. Our vehicles address the challenges of traditional fuel price instability and local, state and federal regulatory compliance. Beginning in January 2025, the Company operates under three segments: electric vehicles, medical supplies and drones.

For the three months ended ~~March~~June 3130, 2025 and 2024 , we generated sales revenue of $~~590~~1,~~567~~047,029 and $~~81 0~~812,~~490~~770, ~~respectively~~respect ively, and our net loss for the three months ended ~~March~~June 3130, 2025 and ~~March~~June 3130, 2024 was $145,~~036~~146,~~381~~ 737 and $4755,~~532~~092,~~363,~~ respectively. ~~Included~~For ~~in our net loss for~~ the ~~three~~ six months ended ~~March 31~~ June 30, 2025 is ~~a non-cash unrealized loss on financial instruments of $283,793~~ and a2024 ~~non-cash~~, ~~impairment~~we ~~charge~~generated ~~related~~sales torevenue ~~our goodwill~~ of $101,~~103~~637,~~048.~~595 ~~Included~~and i$1,623,260, respect nively, and our net loss for the ~~three~~six months ended ~~March~~ 31 June 30, ~~2024 is~~2025 and aJune ~~non-cash unrealized~~30, ~~loss on~~2024 ~~financial~~was ~~instruments~~$19,183,118 ofand $15 ,~~569~~287,~~927~~455, respectively.

Included i ~~Maddox~~n ~~Acquisition~~our net loss for the three months ended June 30, 2025 is a non-cash unrealized loss on financial instruments of $290,144 and a non-cash realized loss from conversion of our convertible notes of $76,764. Included in our net loss for the three months ended June 30, 2024 is a non-cash unrealized gain on financial instruments of $570,519. Included in our net loss for the six months ended June 30, 2025 is a non-cash unrealized loss on financial instruments of $573,937, a non-cash realized loss from conversion of our convertible notes of $76,764 and a non-cash impairment charge related to our goodwill of $10,103,048. Included in our net loss for the six months ended June 30, 2024 is a non-cash unrealized loss on financial instruments of $999,408.

OnOne ~~December 18~~Big, ~~2024~~Beautiful ~~(the~~Bill ~~“Closing~~Act Date”), we acquired all of the outstanding membership interests in Maddox Industries, a provider of government contracting solutions based in Puerto Rico, from Jason Maddox, the sole member of Maddox Industries, to acquire all of the outstanding membership interests in Maddox Industries from Mr. Maddox. As consideration for the acquisition of Maddox Industries, at the closing, we issued 3,100,000 shares of our common stock to Mr. Maddox (~~referred to herein as~~ the ~~“Stock Consideration”~~"Act"), provided that the number of shares of common stock constituting the Stock Consideration will be reduced by any number of whole shares of common stock exceeding 19.99% of the outstanding shares of common stock as of immediately prior to the closing. As additional consideration for the acquisition, during the six-month Earnout Period following the closing, Mr. Maddox will be eligible to receive up to six monthly cash payments in an aggregate amount of up to $1 million (each referred to herein as an “Earnout Payment”) in accordance with the terms of the MIPA. The Earnout Payment payable to Mr. Maddox for each calendar month during the Earnout Period, if any, will be equal to the aggregate amount of gross revenue received by Maddox Industries in respect of any accounts receivable from any existing customer outstanding as of the closing during such calendar month, provided that all Earnout Payments payable by us to Mr. Maddox under the MIPA may not exceed $1 million. The acquisition includes a three-year contract manufacturing agreement to be executed at our expansive 580,000 square-foot facility in Osceola, Arkansas. The Board appointed Jason Maddox our President effective as of October 16, 2024. The results of operations for the three months ended March 31, 2025 include the results of Maddox Industries. The results of operations for the three months ended March 31, 2024 do not include the results of Maddox Industries.

The demand for our vehicles may be affected adversely from the Act due to significant reductions in electric vehicle credits made available to consumers. This may affect our future profitability.

Import Tariffs

Tariffs imposed by the current administration may significantly affect demand for our vehicles or reduce our gross profits if we are unable to pass such tariffs to our customers. We are currently assessing the impact and will take appropriate action to minimize the impact of such tariffs on our electric vehicle strategy.

Nasdaq Deficiency Notice

On March 6, 2025, we received a letter (the “Notice”) from the Nasdaq Listing Qualifications Department, notifying us that, based upon the closing bid price of our common stock for the 30 consecutive business days from January 21, 2025 to March 5, 2025, we no longer meet the requirement to maintain a minimum bid price of $1 per share, as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), Nasdaq has provided us with 180 calendar days, or until September 2, 2025 (the “Compliance Date”), to regain compliance with the Minimum Bid Price Requirement. The Notice has no immediate effect on the listing of our common stock, which will continue to trade on the Nasdaq Capital Market under the symbol “EVTV”, subject to our compliance with the other continued listing requirements of the Nasdaq Capital Market.

AtOn aAugust ~~special meeting of our stockholders held on May 1~~6, 2025, ~~our~~we ~~stockholders~~filed ~~approved~~a ancertificate of amendment to ~~our~~the Company’s Amended and Restated Certificate of Incorporation, aswith ~~amended,~~the Secretary of State of the State of Delaware to effect, ata 1-for-10 reverse stock split of the ~~discretion~~shares of the ~~Board,~~Company’s acommon ~~reverse~~stock (the “Reverse Stock Split”). The Company’s common stock began trading on a post-split basis on the Nasdaq Capital Market as of ~~our~~the open of trading on August 8, 2025. Upon the effectiveness of the Reverse Stock Split, every 10 issued and outstanding shares of the Company’s common stock atwere aautomatically ~~ratio~~combined into one share of common stock, without any change in the ~~range~~par value per share. No fractional shares were issued as a result of ~~1-for-5~~the Reverse Stock Split. Instead, any fractional shares of Common Stock that would have otherwise resulted from the Reverse Stock Split were rounded up to ~~1-for-10~~the nearest whole share. Proportional adjustments were made to the number of shares of the Company’s common stock issuable upon exercise of the Company's outstanding stock options and warrants, ~~with~~as ~~such~~well ~~ratio~~as the applicable exercise prices, and to bethe ~~determined~~number atof shares issuable under the ~~discretion~~Company’s 2017 Equity Incentive Plan. The Reverse Stock Split did not affect the number of authorized shares of the ~~Board~~Company’s (common stock. All references made to share or per share amounts in the “accompanying unaudited interim condensed consolidated financial statements and applicable disclosures have been retroactively adjusted for all periods presented to reflect the applicable effects of the Reverse Stock Split”). Under Nasdaq Listing Rules, to regain compliance, the closing bid price of the Company’s common stock must be at least $1 per share for a minimum of ten consecutive business days to regain compliance with the Minimum Bid Price Requirement.

WeThere ~~are considering available options, including implementing the Reverse Stock Split, to regain compliance with the Minimum Bid Price Requirement. However, there~~ can be no assurance that we will be able to regain compliance with the Minimum Bid Price Requirement or that we will be able to remain in compliance with the applicable Nasdaq listing requirements on an ongoing basis.

Factors Affecting Our Performance

We believe that the growth and future success of our business depend on various opportunities, challenges and other factors, including the following:

Availability of government subsidies, rebates and economic incentives. We believe that the availability of government subsidies, rebates, and economic incentives is currently a critical factor considered by our customers when purchasing our zero-emission systems or converting their existing vehicles to zero-emission-electric or hybrids, and that our growth depends in large part on the availability and amounts of these subsidies and economic incentives. As an alternative to being dependent on such funding, however, we are exploring the possibility of leasing our vehicles to our customers as well.

New customers. We are competing with other companies and technologies to help fleet managers and their districts/companies more efficiently and cost-effectively manage their fleet operations. Once these fleet managers have decided they want to buy from us, we still face challenges with helping them to obtain financing options to reduce the cost barriers to purchasing. We may also encounter customers with inadequate electrical services at their facilities that may delay their ability to purchase from us.

Dependence on external sources of financing of our operations. We have historically depended on external sources of capital to finance our operations. Accordingly, our future performance will depend in part upon our ability to achieve independence from external sources for the financing of our operations.

Investment in growth. We plan to continue to invest for long-term growth. We anticipate that our operating expenses will increase in the foreseeable future as we invest in research and development to enhance our zero-emission electric vehicles and systems; design, develop and manufacture our commercial fleet vehicles and their components; increase our sales and marketing to acquire new customers; and increase our general and administrative functions to support our growing operations. We believe that these investments will contribute to our long-term growth, although they will adversely affect our results of operations in the near term. In addition, the timing of these investments can result in fluctuations in our annual and quarterly operating results.

Zero-emission electric vehicle experience. Our dealer and service network is not currently completely established, although we do have certain agreements in place. One issue they may have, and we may encounter, is finding appropriately trained technicians with zero-emission electric fleet vehicle experience. Our performance will depend on having a robust dealer and service network, which will require appropriately trained technicians to be successful. Because vehicles that utilize our technology are based on a different technology platform than traditional internal combustion engines, individuals with sufficient training in zero-emission electric vehicles may not be available to hire, and we may need to expend significant time and expense training the employees we do hire. If we are not able to attract, assimilate, train or retain additional highly qualified personnel in the future, or do so cost-effectively, our performance would be significantly and adversely affected.

Market growth. We believe the market for all-electric solutions for alternative fuel technology, specifically all-electric vehicles, will continue to grow as more purchases of new zero-emission vehicles and as more conversions of existing fleet vehicles to zero-emission vehicles are made. However, unless the costs to produce such vehicles decrease dramatically, purchasers of our products will continue to depend in large part on financing subsidies from government agencies. We cannot be assured of the continued availability, the amounts of such assistance to our customers, or our ability to access such funds.

Sales revenue growth from additional products. We seek to add to our product offerings additional zero-emission vehicles of all sizes to be marketed, sold, warrantied and serviced through our developing distribution and service network, as well as add other ancillary products discussed elsewhere in this Quarterly Report.

Third-party contractors, suppliers and manufacturers. We rely upon third parties to supply us with raw materials, parts, components and services in adequate quantity in a timely manner and at reasonable prices, quality levels, and volumes acceptable to us. We also are solely reliant on one vendor which is a related party to provide all vehicles as there is currently no manufacturing in the United States.

Components of Results of Operations

Sales

Sales are recognized from the sales of new, purpose-built zero-emission electric vehicles and from providing vehicle maintenance and safety inspection services. Revenue ~~related~~is torecognized ~~our~~at ~~medical~~the ~~supplies~~point ~~activities~~in ~~are~~time ~~recognized~~ when ~~such~~control ~~supplies~~transfers ~~have~~to ~~been~~the ~~delivered~~customer, towhich ~~our~~in ~~end~~this ~~customer~~arrangement, occurs when the gowns are delivered. Sales are recognized in accordance with ASC 606, as discussed in Note 2 to our unaudited consolidated financial statements included in this Quarterly Report.

Cost of Sales

Cost of sales includes those costs related to the development, manufacture, and distribution of our electric vehicles. Specifically, we include in cost of sales for our electric vehicles segment each of the following: material costs (including commodity costs); freight costs; labor and other costs related to the development and manufacture of our electric vehicles; and other associated costs. Cost of sales also includes costs related to the valuation of inventory due to impairment, obsolescence, or shrinkage. Cost of sales included in our medical supplies activities include direct labor and accessories such as tape, glues, etc. The main materials of our medical supplies segment are supplied by the customer.

General and Administrative Expenses

Selling, general and administrative expenses include all corporate and administrative functions that support our Company, including personnel-related expense and stock-based compensation costs; costs related to investor relations activities; including product recall and customer satisfaction program costs; consulting costs; marketing-related expenses; and other expenses that cannot be included in cost of sales.

Consulting and Research and Development Costs

These expenses are related to our consulting and research and development activity.

Other (Expense)Income, Net

Other (expense)/income include non-operating income and expenses, including interest income and expense, realized gain/(loss) on conversion of convertible notes and unrealized gain (loss) of financial instruments at fair value.

Provision for Income Taxes

We account for income taxes in accordance with ASC 740 which requires the recognition of deferred income tax assets and liabilities for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that we will not realize tax assets through future operations. Because we have incurred only losses to this point, no provision for income taxes has been made in 2024.

Results of Operations

The following discussion compares our results of operations for the three and ~~three~~six months ended ~~March~~June 3130, 2025 to the corresponding periods ended ~~March~~June 3130, 2024:

Sales

Sales for the three months ended ~~March~~June 3130, 2025 and 2024 were $~~590~~1,~~567~~047,029 and $~~810~~812,~~490~~770, respectively. Sales for the three months ended ~~March~~June 3130, 2025 of our electric vehicle segment were ($~~373~~25,~~130~~237) as ~~and~~certain ~~consisted~~credit ~~primarily~~memos ofwere ~~two~~issued ~~class~~for 4operational ~~trucks and one cargo van~~purposes. Sales of our medical supplies segment consisted of delivery of medical ~~gowns~~supplies totaling $~~217~~1,~~437~~072,266 to a related party. Sales for the three months ended ~~March~~June 3130, 2024 consisted primarily of ~~six~~five logistics cargo vans, ~~two~~one ~~trucks~~cab and chassis truck, one ~~forklift~~electric sweeper and ~~other~~one ~~accessories~~passenger van. The sales decrease in our electric vehicle segment was primarily due to less favorable market conditions.

Sales for the six months ended June 30, 2025 and 2024 were $1,637,595 and $1,623,260, respectively. Sales for the six months ended June 30, 2025 of our electric vehicle segment were $348,063 and consisted primarily of two logistics cargo vans and two cab and chassis trucks. Sales of our medical supplies segment consisted of delivery of medical supplies totaling $1,289,532 to a related party. Sales for our medical supplies segment is based on a cost-plus pricing structure. The sales decrease in our electric vehicle segment was primarily due to less favorable market conditions.

Cost of Sales

Cost of sales for the three months ended ~~March~~June 3130, 2025 and 2024 were $~~471~~2,~~175~~504,746 and $~~502~~608,~~271~~947, respectively. Cost of sales of our electric vehicles segment was $~~264~~1,~~343~~523,713 for the three months ended ~~March~~June 3130, 2025. Cost of sales of our medical supplies segment was $~~206~~981,~~812~~033 for the three months ended ~~March~~June 3130, 2025. Cost of sales for our electric vehicles segment was related to the sales of the trucks and van and additional inventory write-downs while cost of sales for our medical supplies segment was based on a cost-plus pricing structure to a related party. Cost of sales for the three months ended ~~March~~June 3130, 2024 consisted of the costs related to the sale of the electric vehicles sold as described above.

Cost of sales for the six months ended June 30, 2025 and 2024 were $2,975,921 and $1,111,218, respectively. Cost of sales of our electric vehicles segment was $1,788,075 for the six months ended June 30, 2025. Cost of sales of our medical supplies segment was $1,187,845 for the six months ended June 30, 2025. Cost of sales for our electric vehicles segment was related to the sales of the trucks and van and additional inventory write-downs of $1,172,302 while cost of sales for our medical supplies segment was based on a cost-plus pricing structure to a related party. Cost of sales for the six months ended June 30, 2024 consisted of the costs related to the sale of the electric vehicles sold as described above.

General and Administrative ("G&A") Expenses

G&A expenses were $32,~~603~~751,~~108~~788 and $31,~~194~~466,~~251~~ 748 for the three months ended ~~March~~June 3130, 2025 and 2024, respectively. G&A expenses increased primarily due to higher provision for doubtful receivables, higher legal and accounting costs due to additional ~~payroll~~resources required for compliance and other ~~costs~~matters, ~~incurred~~higher commissions as ainvestment ~~result~~banking offees ~~our~~for ~~new~~the ~~medical~~convertible ~~supplies~~notes, higher ~~segment~~rents due to the Houston facility, ~~partially~~additional ~~offset~~rentals byfor ~~lower~~housing ~~stock~~and ~~compensation~~equipment ~~costs~~and higher amortization expense from the Maddox Acquisition.

G&A expenses were $6,354,896 and $4,660,999 for the six months ended June 30, 2025 and 2024, respectively. G&A expenses increased primarily due to higher provision for doubtful receivables, higher legal and accounting costs due to additional resources required for compliance and other matters, higher payroll and contract labor for various operational projects at the Arkansas and Houston facilities, higher commissions as investment banking fees for the convertible notes, higher rents due to the Houston facility, additional rentals for housing and equipment and higher amortization expense from the Maddox Acquisition, partially offset by lower stock compensation costs due to favorable changes in the inputs to the valuation model.

Consulting Expenses

Consulting expenses were $46,511 for the ~~three~~six months ended ~~March~~June 3130, 2025. These costs were incurred primarily for certain consulting services related to our medical supplies segment.

Research and Development ("R&D") Expenses

R&D expenses were $98590,~~398~~121 and $7061,~~265~~616 for the three months ended ~~March~~June 3130, 2025 and 2024, respectively, as the level of activity ~~was~~ increased. R&D expenses were $688,519 and $131,880 for the six months ended June 30, 2025 and 2024, respectively, primarily due to costs incurred in our drone segment to build certain prototypes.

Goodwill Impairment Charge

Due to our declining stock price, we conducted an impairment test related to our goodwill. As a result of this test, we recorded an impairment charge of $10,103,048 related to our goodwill for the three and six months ended ~~March 31~~June 30, 2025. No impairment charges were recorded for the three and six months ended ~~March 31~~June 30, 2024.

Unrealized loss on financial instruments at fair value

We recorded a non-cash unrealized loss of $~~283~~290,~~793~~144 for the three months ended June 30, 2025 and an unrealized gain of $1570,~~569,927~~519 for the three months ended ~~March~~June 30, 2024, on our financial instruments that we elected to measure 31at fair value. We recorded a non-cash unrealized loss of $573,937 and $999,408 for the six months ended June 30, 2025 and 2024, respectively, on our financial instruments that we elected to measure at fair value. These valuations are directly impacted by the changes in our stock price which declined since the instruments were issued.

Realized loss on conversion of convertible notes

We recognized a loss of $76,764 due to the conversion of the Promissory Notes and Additional Promissory Notes into the shares of the Company's common stock for the three and six months ended June 30, 2025.

Cash Flows

The following table summarizes our cash flows from operating, investing, and financing activities for the ~~three~~six months ended ~~March~~June 3130, 2025 and 2024:

	Three months ended March 31,
	Six months ended June 30,
	2025			2024
Cash flows used in operating activities	$	(45,~~217~~385,~~480~~357	)	$	(~~735~~1,~~571~~700,563	)
Cash flows used in investing activities		(176,828	)		—(135,288	)
Cash flows provided by financing activities		24,~~664~~563,~~411~~245			1,~~328~~816,~~209~~196
Net change in cash, restricted cash and cash equivalents	$	(1998,~~729,897~~940	)	$	~~592~~(19,~~638~~655	)

Operating Activities

Net cash used in operating activities for the ~~three~~six months ended ~~March~~June 3130, 2025 was $45,~~217~~385,~~480~~357, primarily due to a net loss of $1419,~~036~~183,~~381~~118, ~~and~~partially offset by changes in operating assets and liabilities, net of $1,~~395~~897,~~200,~~702 ~~partially offset by~~ and non-cash operating ~~charges~~changes of $11,~~214~~900,~~101~~059. The changes in operating assets and liabilities, net was due toa andecrease ~~increase~~ in accounts receivable ~~from related party~~ of $~~202~~576,~~663~~374, ~~and~~a ~~increase~~decrease in ~~miscellaneous~~inventory ~~receivable~~ of $21,~~249~~560,~~515~~698, ~~(related~~a todecrease ~~certain~~in ~~fraudulent~~prepaid ~~activities~~expenses ~~related~~and toother ~~our~~current ~~banking~~assets ~~operations~~of ~~and~~$779,123, ~~that~~an ~~was~~increase ~~subsequently~~in ~~credited~~accounts ~~back~~payable toof ~~us)~~$694,769, ~~and~~an increase in ~~inventory~~deferred ~~deposits~~revenue of $2,~~675~~284,~~003~~415 ~~(primarily~~as ~~from~~a ~~deposits~~result ~~for~~of ~~our~~fundings ~~EPA~~from ~~grant~~the ~~program)~~EPA grants and aan ~~decrease~~increase of $508,381 in other liabilities primarily from the capitalization of ~~$30,467,~~the Houston lease, partially offset by aan ~~decrease~~increase in ~~accounts~~related party receivable of $~~164~~1,~~541~~161,947 afrom ~~decrease~~our inmedical ~~inventory~~supplies ~~of $167~~segment,~~108,~~ aan ~~decrease~~increase in ~~prepaid~~inventory ~~expenses~~deposits of $~~629~~2,~~596~~743,291, aan ~~decrease~~increase in ~~other current and~~ non-current assets of $55568,~~751,~~154 anprimarily ~~increase~~from inthe ~~accounts~~capitalization ~~payable~~of ~~and~~the ~~accrued~~Houston ~~liabilities~~lease ofas ~~$461,037~~a ROU asset and ana ~~increase~~decrease in ~~deferred~~accrued ~~revenue~~liabilities of $232,~~284,415 (primarily related to our EPA grant program)~~666.

Net cash used in operating activities for the ~~three~~ six months ended ~~March 31~~June 30, 2024 was $~~735~~1,~~571~~700,563, primarily due to a net loss of $45,~~532~~287,~~363~~455, partially offset by changes in operating assets and liabilities, net of $~~369~~658,~~270~~ 185 and non-cash operating charges of $32,~~427~~928,522, of which $1,569,927 was related to a non-cash unrealized loss on financial instruments measured at fair values, $1,818,383 was related to non-cash stock-based compensation expense and the remaining $39,212 was related to depreciation and amortization519. The changes in operating assets and liabilities, net was due to a decrease ~~of $466,757~~ in inventory deposits of $443,074, a decrease in prepaid expenses of $~~257~~187,~~086~~474, a decrease in ~~other~~inventory ~~current assets~~ of $25127,~~439~~372, a decrease in other ~~non-current~~ assets of $65164,~~010~~467, an increase in accounts payable of $~~171~~195,~~363~~786 and an increase in accrued liabilities of $~~207~~438,~~437~~089, ~~partially~~ partially offset by an increase in ~~inventory of $410,126, an increase in~~ accounts receivable of $~~333~~733,~~085~~998 ~~as sales outpaced cash collections~~ and a decrease ~~of $80,611~~ in other liabilities of $164,079.

We expect cash used in operating activities to fluctuate significantly in future periods as a result of a number of factors, some of which are outside of our control, including, among others: the success we achieve in generating revenue; the success we have in helping our customers obtain financing and government incentives to subsidize their purchases of our products; our ability to efficiently develop our dealer and service network; the costs of batteries and other materials utilized to make our products; the extent to which we need to invest additional funds in research and development; ~~and~~ the amount of expenses we incur to satisfy future warranty claims, and the ability to engage in supply medical supplies to the federal government on a long-term basis.

Investing Activities

Net cash used in investing activities during the ~~three~~ six months ended ~~March 31~~June 30, 2025 was $176,828, primarily from the purchase of property and equipment that is used in our current operations.

Net cash ~~provided~~used by in investing activities during the ~~three~~ six months ended ~~March~~June 3130, 2024 was $0135,288, ~~due~~primarily tofrom ~~our~~the ~~initiative~~purchase toof ~~conserve~~property ~~cash~~and ~~spend~~equipment that is used in our current operations.

Financing Activities

Net cash provided by financing activities during the ~~three~~ six months ended ~~March 31~~June 30, 2025 was $24,~~664~~563,~~411,~~245 primarily ~~due to proceeds~~ from the issuance of ~~our~~the ~~convertible~~Additional ~~notes~~Promissory ofNotes for $24,~~850~~750,500 in net proceeds, partially offset by ~~the~~loan ~~repayment~~repayments of ~~debt of~~ $~~186~~187,~~089~~255.

Net cash provided by financing activities during the ~~three~~ six months ended ~~March~~June 3130, 2024 was $1,~~328~~816,~~209~~196, primarily due to proceeds from the issuance of ~~the~~our ~~Note a~~common ~~convertible~~stock ~~note~~of ~~that~~$949,248, ~~resulted~~proceeds infrom ~~proceeds~~the issuance of a convertible note of $901,000, and proceeds offrom ~~sale~~issuance of ~~our~~debt ~~common~~for ~~stock to certain investors totaling~~ $~~585~~232,~~499~~067, partially offset by ~~debt~~the repayment inof ~~the~~debt ~~amount~~ of $~~158~~266,~~290~~119. See Note 5 - Debt to our unaudited consolidated financial statements included in this Quarterly Report for additional information regarding these financing activities.

Liquidity and Capital Resources

As of ~~March~~June 3130, 2025, we had cash and cash equivalents of $~~211~~942,~~284~~241 and negative working capital of approximately $4120,~~394,102~~030. We ~~Included~~believe inthat our ~~working~~existing ~~capital~~cash ~~was~~and cash aequivalents ~~miscellaneous~~and ~~receivable~~current ofbusiness ~~$2.249,515~~plan that ~~was recorded due to certain fraudulent activities conducted by external parties unrelated to~~ provides us ~~related~~with tothird-party ~~our~~financing ~~bank~~may ~~accounts but was subsequently credited back to us. We believe that our existing cash and cash equivalents will~~ be sufficient to fund our operations during the next twelve months and beyond. However, we may not successfully execute our business plan, and if we do not, we may need additional capital to continue our operations and support the increased working capital requirements associated with the fulfillment of purchase orders.

In February 2022, we announced the planned acquisition of a manufacturing facility located in Osceola, Arkansas. The facility, comprising approximately 580,000 square feet, currently serves as our operational base and is intended to become our primary manufacturing site. While we commenced investment in the facility and operations are active under a lease structure, the underlying property transaction remains subject to final closing. We continue to work collaboratively with the City of Osceola to finalize terms related to site development, easements, and purchase conditions.

On February 12, 2025, we announced the relocation of our corporate headquarters and the establishment of a new 86,000 square foot facility in Houston, Texas. This strategic move reinforces our commitment to expanding U.S. manufacturing, strengthening fleet services, and supporting the growing demand for commercial electric vehicles. We ~~plan to~~opened ~~open~~our ~~its~~ new corporate headquarters and manufacturing facility in 2025. As a result of this relocation, we may incur additional capital expenditure and one-time relocation costs, which at the time of filing, are being estimated.

Amended and Restated Standby Equity Purchase Agreement

On October 31, 2024, the Company entered into ~~an amended and restated standby equity purchase agreement (~~the “A&R SEPA”) with ~~YA II PN, Ltd., a Cayman Islands exempt limited company (~~the “Investor”). The A&R SEPA amends and restates in its entirety the ~~standby equity purchase agreement, dated September 23, 2024 (the "~~Original SEPA~~"), by and between the Company and the Investor~~.

Pursuant to the A&R SEPA, except for so long as there is a balance outstanding under the Promissory Notes ~~(as defined below)~~, we have the right, from time to time, until November 1, 2027, to require the Investor to purchase up to $25 million of shares of common stock, subject to certain limitations and conditions set forth in the A&R SEPA, by delivering written notice to the Investor. Pursuant to the A&R SEPA, the Investor advanced to the Company the ~~principal~~Pre-Paid Advance in the amount of $3 million ~~(the “Pre-Paid Advance”)~~ in exchange for the Company’s issuance to the Investor of ~~convertible promissory notes (~~the “Promissory Notes”) in two tranches, resulting in net proceeds (net of discounts and fees) to the Company of $2,635,500. The Company received the first tranche of the Pre-Paid Advance in the principal amount of $2 million on October 31, 2024 in exchange for the Promissory Note dated October 31, 2024, and the second tranche of the Pre-Paid Advance in the principal amount of $1 million on December 17, 2024 in exchange for the Promissory Note dated December 17, 2024. The Promissory Notes will accrue interest on the outstanding principal balance at an annual rate equal to 0%, which will increase to an annual rate of 18% upon the occurrence of an Event of Default (as defined in the Promissory Notes) or a Registration Event (as defined in the Promissory Notes) for so long as such event remains uncured. The Promissory Notes will mature on November 13, 2025, which may be extended at the option of the Investor. The Promissory Notes are convertible at a conversion price equal to the lower of (i) $221.~~1480~~4800 per share or (ii) 93% of the lowest daily volume weighted average price of the Common Stock on Nasdaq as reported by Bloomberg L.P. during the five consecutive trading days immediately preceding the conversion date (but no lower than the “floor price” then in effect, which is $03.~~3580~~5800 per share, subject to adjustment from time to time in accordance with the terms contained in the Promissory Notes). Pursuant to the terms of the Original SEPA, the Company issued 646,~~103~~410 shares of common stock to the Investor as a commitment fee.

During the first quarter of 2025, the obligation under the EVTV-2 Promissory Note in the principal amount of $1 million was fully satisfied through the conversion of the EVTV-2 Promissory Note into shares of our common stock. As a result of this conversion, 1174,~~743,476~~348 shares of our common stock were issued at a weighted average price of $05.5770. During the same quarter, the obligation under the EVTV-1 Promissory Note in the principal amount of $2 million was partially satisfied through the conversion of the EVTV-1 Promissory Note into shares of our common stock. As a result of this conversion, 1149,~~490,304~~030 shares of our common stock were issued at a weighted average price of $04.4110. ~~The remaining principal balance of the EVTV-1 Promissory Note on March 31, 2025 was $1,550,000.~~

During the second quarter of 2025, the obligation under the EVTV-1 Promissory Note in the principal amount of $2 million was partially satisfied through the conversion of the EVTV-1 Promissory Notes into shares of our common stock. As a result of this conversion, 56,144 shares of our common stock were issued at a weighted average price of $2.50. The remaining principal balance of the EVTV-1 Promissory Notes on June 30, 2025 was $1,250,000. A realized gain of $4,145 was recognized as a result of this conversion for the three months ended June 30, 2025.

Supplemental Agreement to A&R SEPA

On February 24, 2025, we entered into the Supplemental Agreement with the Investor, which amends and supplements the A&R SEPA to: (i) provide for the advancement by the Investor to us, subject to the satisfaction of certain conditions as set forth in the Supplemental Agreement, of the Additional Pre-Paid Advance in the principal amount of $5 million to be evidenced by the Additional Promissory Notes in two tranches, (ii) amend the maturity date for the EVTV-1 Promissory Note to March 9, 2026, and (iii) amend the floor price for the Note EVTV-1 to $0.~~0713~~7130 per share.

The first tranche of the Additional Pre-Paid Advance was disbursed on February 25, 2025 in the principal amount of $3 million (with net proceeds to us of approximately $2.7 million after deducting discounts and fees) as evidenced by the EVTV-3 Additional Promissory Note issued to the Investor on February 24, 2025. The second tranche of the Additional Pre-Paid Advance in the principal amount of $2 million was advanced by the Investor to us upon approval by our stockholders, at a special meeting of stockholders held on May 1, 2025, of the issuance of shares of our common stock in excess of the Exchange Cap (as defined in the A&R SEPA).

~~Line~~The EVTV-4 Additional Promissory Note was disbursed to us on May 7, 2025. During the second quarter of ~~Credit~~2025, the obligation under the EVTV-4 Promissory Note in the principal amount of $2 million was partially satisfied through the conversion of the EVTV-4 Promissory Note into shares of our common stock. As a result of this conversion, 853,275 shares of our common stock were issued at a weighted average price of $2.00. The remaining principal balance of the EVTV-4 Promissory Note on June 30, 2025, was $500,000. A realized loss of $80,909 was recognized as a result of this conversion for the three months ended June 30, 2025.

Effective August 4, 2022, we secured a line of credit from Centennial Bank. Borrowings under the line of credit bore interest at 2.75% annually. There was no maturity date for the line, but Centennial Bank could at any time, in its sole discretion and without cause, demand us to immediately repay any and all outstanding obligations under the line of credit in whole or in part. The line was secured by the cash and cash equivalents maintained by us in our Centennial Bank accounts. Borrowings under the line could not exceed cash, cash equivalents, and marketable securities balances up to $1,000,000. This line was closed during the third quarter of 2023 and there was no principal amount outstanding at the time of closing.

Capital Expenditures

We do not have any contractual obligations for ongoing capital expenditures at this time. We do, however, purchase equipment necessary to conduct our operations on an as needed basis and will continue increasing those expenditures as we transfer assembly and corporate functions to the ~~Osceola~~ ~~Arkansas facility and the~~ Houston, Texas facility.

Contractual Obligations

Other than as disclosed in the unaudited consolidated financial statements in Item 1 of this Quarterly Report for the period ended ~~March~~June 3130, 2025, we have no contractual obligations.

Critical Accounting Policies and Significant Judgments and Estimates

Our consolidated financial statements are prepared in accordance with GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, costs and expenses, and the disclosure of contingent assets and liabilities in our financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.

We define our critical accounting policies as those accounting principles under GAAP that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles.

Smaller Reporting Company Status

We are a “smaller reporting company” as defined in Rule 12b-2 under the Exchange Act. We may continue to be a smaller reporting company if either (i) the market value of our shares held by non-affiliates is less than $250 million measured on the last business day of our most recently completed second fiscal quarter or (ii) our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our shares held by non-affiliates is less than $700 million as of the last business day of our most recently completed second fiscal quarter. We may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not smaller reporting companies, including reduced disclosure about our executive compensation arrangements.

1920

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are exposed to market risks in the ordinary course of our business. We do not currently face material market risks such as interest rate fluctuation risk and foreign currency exchange risk. Our cash and cash equivalents include cash in readily available checking and money market accounts. These investments are not dependent on interest rate fluctuations that may cause the principal amount of these investments to fluctuate, and we do not expect such fluctuation will have a material impact on our financial conditions. If we issue additional debt in the future, we will be subject to interest rate risk. The majority of our expenses are denominated in the U.S. dollar.

We may face risks associated with the costs of raw materials, primarily batteries, as we go into production. To the extent these and other risks materialize, they could have a material effect on our operating results or financial condition. We currently anticipate that our international selling, marketing and administrative costs related to foreign sales, if any, will be largely denominated in United States dollars, which may create foreign currency exchange risk exposure.

ITEM 4. CONTROLS AND PROCEDURES

Limitations on Effectiveness of Controls and Procedures

In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs. Similarly, an evaluation of controls cannot provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) for the quarter ended ~~March~~June 3130, 2025. Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of such time due to the material weakness described below:

We have been unable to maintain appropriate segregation of duties. We have yet to fully resolve such deficiencies as of the date of this filing. We have engaged, and continue to seek additional, experienced accounting professionals with relevant expertise to provide additional accounting services to supplement our efforts and mitigate the negative effects of our limited accounting staff.

Changes in Internal Control over Financial Reporting

There was no change in the Company’s internal control over financial reporting during the most recent three-month period covered by this Quarterly Report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

2021

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Except as described in Note 1211 - Contingencies, there were no material developments during the quarter ended ~~March~~June 3130, 2025 in the legal proceedings described in our Annual Report on Form 10-K for the year ended December 31, 2024

ITEM 1A. RISK FACTORS

There were no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

2122

ITEM 6. EXHIBITS

A list of exhibits is set forth at the end of this Quarterly Report on Form 10-Q for the information required by this item.

Incorporated by Reference

Exhibit Number

Exhibit Description

Form

File No.

Exhibit

Filing Date

Filed Herewith

10.1

Supplemental Agreement, dated February 24, 2025, by and between Envirotech Vehicles, Inc. and YA II PN, Ltd.

8-K

001-38078

10.1

2/25/2025

3.1

Amended and Restated Certificate of Incorporation of the Company

1-A POS

024-10656

2.7

6/15/2017

10.2

Convertible Promissory Note, dated February 24, 2025, issued to YA II PN, Ltd.

8-K

001-38078

10.2

2/25/2025

3.2

Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on June 8, 2018

8-K

001-38078

3.1

6/11/2018

3.3

Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on May 26, 2021

8-K

001-38078

3.1

6/2/2021

3.4

Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on June 24, 2022

8-K

001-38078

3.1

6/28/2022

3.5

Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company filed with the Secretary of State of Delaware on August 6, 2025

8-K

001-38078

3.1

8/6/2025

3.6

Amended and Restated Bylaws of the Company

1-A POS

024-10656

2.8

6/15/2017

31.1

Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer

31.2

Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer

32.1#

18 U.S.C. Section 1350 Certification of Chief Executive Officer, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2#

18 U.S.C. Section 1350 Certification of Chief Financial Officer, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS

Inline XBRL Instance Document*

101.SCH

Inline XBRL Taxonomy Extension Schema Document*

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document*

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document*

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document*

101.DEF

Inline XBRL Taxonomy Extension Definitions Linkbase Document*

104

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

The information in Exhibits 32.1 and 32.2 shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act (including this Quarterly Report), unless the Registrant specifically incorporates the foregoing information into those documents by reference.

*	In accordance with Rule 402 of Regulation S-T, this interactive data file is deemed not filed or part of this Quarterly Report for purposes of Sections 11 or 12 of the Securities Act or Section 18 of the Exchange Act and otherwise is not subject to liability under these sections.

2223

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Quarterly Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Envirotech Vehicles, Inc.
Date: May 20, 2025	By:	/s/ Phillip W. Oldridge
Date: August 18, 2025	By:	/s/ Phillip W. Oldridge
		Phillip W. Oldridge
		Chief Executive Officer
		(Principal Executive Officer)
Date: May 20, 2025	By:	/s/ Jason Maddox
Date: August 18, 2025	By:	/s/ Jason Maddox
		Jason Maddox
		President and Interim Chief Financial Officer
		(Principal Financial and Accounting Officer)

2324

Filing Compare · Envirotech Vehicles, Inc.