# EDGAR Filing Document

**Accession Number:** 0001687542
**File Stem:** 0001641172-25-024669
**Filing Date:** 2025-8
**Character Count:** 128565
**Document Hash:** c51b05d486c14a40e24d65d78878a6ad
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001641172-25-024669.hdr.sgml**: 20250818

**ACCESSION NUMBER**: 0001641172-25-024669

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 81

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250818

**DATE AS OF CHANGE**: 20250818

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Freight Technologies, Inc.
- **CENTRAL INDEX KEY:** 0001687542
- **STANDARD INDUSTRIAL CLASSIFICATION:** ARRANGEMENT OF TRANSPORTATION OF FREIGHT & CARGO [4731]
- **ORGANIZATION NAME:** 01 Energy & Transportation
- **EIN:** 000000000
- **STATE OF INCORPORATION:** D8
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-38172
- **FILM NUMBER:** 251228966

**BUSINESS ADDRESS:**
- **STREET 1:** 2001 TIMBERLOCH PLACE
- **STREET 2:** SUITE 500
- **CITY:** THE WOODLANDS
- **STATE:** TX
- **ZIP:** 77380
- **BUSINESS PHONE:** (773) 905-5076

**MAIL ADDRESS:**
- **STREET 1:** 2001 TIMBERLOCH PLACE
- **STREET 2:** SUITE 500
- **CITY:** THE WOODLANDS
- **STATE:** TX
- **ZIP:** 77380

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Hudson Capital Inc.
- **DATE OF NAME CHANGE:** 20200507

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** China Internet Nationwide Financial Services, Inc.
- **DATE OF NAME CHANGE:** 20161014

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION** ****

**Washington, D.C. 20549**

**FORM 10-Q**

(Mark One)

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

For the quarterly period ended: <u>June 30, 2025</u>

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

For the transition period from ____________ to _____________

Commission File No. 001-38172

---

| |
|:---|
| **FREIGHT TECHNOLOGIES, INC.** |
| (Exact name of registrant as specified in its charter) |

---

---

| | |
|:---|:---|
| **British Virgin Islands** | **47-5429768** |
| (State or other jurisdiction<br> of incorporation or organization) | (I.R.S. Employer <br> Identification No.) |

---

---

| | |
|:---|:---|
| **2001 Timberloch Place, Suite 500**<br>**The Woodlands, TX** | **77380** |
| (Address of principal executive offices) | (Zip Code) |

---

---

| |
|:---|
| **(773) 905-5076** |
| (Registrant's telephone number, including area code) |

---

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

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| Ordinary Shares, no par value | FRGT | The Nasdaq Stock Market LLC |

---

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

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 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 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 ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> 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 Act). Yes ☐ No ☒

As of August 15, 2025, there were a total of 2,752,322 registrant's Ordinary Shares with no par value outstanding.

**DOCUMENTS INCORPORATED BY REFERENCE**

None.

**FREIGHT TECHNOLOGIES, INC.**

**Quarterly Report on Form 10-Q**

**Period Ended June 30, 2025**

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  | **[PART I](#ch_001)** |  |
|  | **FINANCIAL INFORMATION** |  |
| Item 1. | [Financial Statements](#ch_002) | 3 |
| Item 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#ch_008) | 23 |
| Item 3. | [Quantitative and Qualitative Disclosures About Market Risk](#ch_009) | 29 |
| Item 4. | [Controls and Procedures](#ch_010) | 29 |
|  | **[PART II](#ch_011)** |  |
|  | **OTHER INFORMATION** |  |
| Item 1. | [Legal Proceedings](#ch_012) | 30 |
| Item 1A. | [Risk Factors](#ch_013) | 30 |
| Item 2. | [Unregistered Sales of Equity Securities and Use of Proceeds](#ch_014) | 30 |
| Item 3. | [Defaults Upon Senior Securities](#ch_015) | 30 |
| Item 4. | [Mine Safety Disclosures](#ch_016) | 30 |
| Item 5. | [Other Information](#ch_017) | 30 |
| Item 6. | [Exhibits](#ch_018) | 31 |
| [Signatures](#ch_019) |  | 32 |

---

**PART I – FINANCIAL INFORMATION**

**ITEM 1. FINANCIAL STATEMENTS**

**FREIGHT TECHNOLOGIES, INC.**

**UNAUDITED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Condensed Consolidated Balance Sheets as of June 30, 2025 (unaudited) and December 31, 2024](#ch_003) | 4 |
| [Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](#ch_004) | 5 |
| [Unaudited Condensed Consolidated Statements of Stockholders' Equity (Deficit)](#ch_005) | 6 |
| [Unaudited Condensed Consolidated Statements of Cash Flows](#ch_006) | 7 |
| [Notes to Unaudited Financial Statements](#ch_007) | 8 |

---

**FREIGHT TECHNOLOGIES, INC. AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

---

| | | |
|:---|:---|:---|
|  | **June 30, 2025**<br>**(unaudited)** | **December 31, 2024**<br>**(audited)** |
| **ASSETS:** |  |  |
| **Current assets:** |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $586658 | $204032 |
| &nbsp;&nbsp;&nbsp;Accounts receivable, net | 5610917 | 3533330 |
| &nbsp;&nbsp;&nbsp;Unbilled receivables | 846784 | 520037 |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 1052777 | 792147 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current assets** | 8097136 | 5049546 |
| Capitalized software, net | 564423 | 574109 |
| Property and equipment, net | 9441 | 13238 |
| Other long-term assets |  | 39988 |
| Security deposits | 7818 | 7818 |
| Cryptocurrencies | 8376410 |  |
| Other intangible assets, net | 5139 | 5546 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total assets** | $17060367 | $5690245 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT):** |  |  |
| **Current liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $1374120 | $1442517 |
| &nbsp;&nbsp;&nbsp;Accrued expenses | 1143820 | 1280563 |
| &nbsp;&nbsp;&nbsp;Short-term borrowings | 4851762 | 3343710 |
| &nbsp;&nbsp;&nbsp;Convertible debt | 500000 |  |
| &nbsp;&nbsp;&nbsp;Income tax payable | 297363 | 278215 |
| &nbsp;&nbsp;&nbsp;Insurance financing payable | 109922 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current liabilities** | 8276987 | 6345005 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities** | 8276987 | 6345005 |
| COMMITMENTS AND CONTINGENCIES |  |  |
| **STOCKHOLDERS' EQUITY (DEFICIT)** |  |  |
| &nbsp;&nbsp;&nbsp;Series A preferred stock, $0.0001 par value, unlimited shares authorized; 6,054,823 and 1,815,438 issued and outstanding at June 30, 2025 and December 31, 2024, respectively | 606 | 182 |
| &nbsp;&nbsp;&nbsp;Series B preferred stock, $0.0001 par value, 21,000,000 shares authorized; 1,262,074 issued and outstanding at June 30, 2025 and December 31, 2024 | 126 | 126 |
| &nbsp;&nbsp;&nbsp;Series seed preferred stock, $0.0001 par value, 25,000 shares authorized; 7,020 issued and outstanding at June 30, 205 and December 31, 2024 |  |  |
| &nbsp;&nbsp;&nbsp;Ordinary shares, no par value, (\*\*) unlimited shares authorized; 2,652,322 and 546,269 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively |  |  |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 55638285 | 45510375 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (45869587) | (44916779) |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (986050) | (1248664) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total stockholders' equity (deficit)** | 8783380 | (654760) |
| **Total liabilities and stockholders' equity (deficit)** | $17060367 | $5690245 |

---

---

| | |
|:---|:---|
| (\*) | List of authorized shares for Series A preferred |
| a. | Series A1A preferred shares: 10,000,000 authorized shares |
| b. | Series A2 preferred shares: 3,000,000 authorized shares |
| c. | Series A4 preferred shares: unlimited authorized shares |
| (\*\*) | Ordinary Share par value was change to no par value in June 2024. |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FREIGHT TECHNOLOGIES, INC. AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)**

**(UNAUDITED)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended June 30** | **Three Months Ended June 30** | **Six Months** **Ended June 30** | **Six Months** **Ended June 30** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenue** | $**2989910** | $**3837842** | $**7090550** | $**8125602** |
| **Cost and expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cost of revenue | 2534689 | 3113444 | 6127989 | 7170071 |
| &nbsp;&nbsp;&nbsp;Compensation and employee benefits | 1109141 | 1363395 | 2363930 | 2817736 |
| &nbsp;&nbsp;&nbsp;General and administrative | 663272 | 940390 | 1260025 | 1671927 |
| &nbsp;&nbsp;&nbsp;Sales and marketing | 46844 | 15525 | 62889 | 34319 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 106935 | 110039 | 210789 | 220246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total cost and expenses** | **4460881** | **5542793** | **10025622** | **11914299** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Operating loss** | **(1470971)** | **(1704951)** | **(2935072)** | **(3788697)** |
| **Other income and expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense, net | (208245) | (231828) | (343109) | (404532) |
| &nbsp;&nbsp;&nbsp;Change in fair value of convertible note |  | 22602 |  | 22602 |
| &nbsp;&nbsp;&nbsp;Realized gain (loss) in value of sold cryptocurrency | (80057) |  | (80057) |  |
| &nbsp;&nbsp;&nbsp;Unrealized gain (loss) in fair value of cryptocurrency | 2427754 | - | 2427754 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Income (loss) before provision for income taxes** | **668481** | **(1914177)** | **(930484)** | **(4170627)** |
| &nbsp;&nbsp;&nbsp;Income tax expense | 19243 | 40379 | 22324 | 40379 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net Income (Loss)** | $**649238** | $**(1954556)** | $**(952808)** | $**(4211006)** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic net income (loss) per share attributable to ordinary shareholders | $0.38 | $(24.66) | $(0.85) | $(63.75) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic weighted average shares outstanding | 1692519 | 79268 | 1125227 | 66056 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted net income (loss) per share attributable to ordinary shareholders, | $0.02 | $(24.66) | $(0.85) | $(63.75) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted weighted average shares outstanding | 29314475 | 79268 | 1125227 | 66056 |
| **Net income (loss)** | $**649238** | $**(1954556)** | $**(952808)** | $**(4211006)** |
| **Other comprehensive gain (loss) net of tax** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency translation gain (loss) | 241796 | (576440) | 262616 | (415300) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Comprehensive income (loss)** | $**891034** | $**(2530996)** | **(690192)** | $**(4626306)** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FREIGHT TECHNOLOGIES, INC. AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)**

**(UNAUDITED)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | | **Preferred Stock** | **Preferred Stock** | | | **Ordinary Shares (\*)**  | **Ordinary Shares (\*)**  | | | | |
|  |<br>**Series A Shares** |<br>**Amount** | **Series B Shares** | **Amount** | **Series**<br>**Seed Shares** |<br>**Amount** | **Ordinary Shares** | **Amount** | **Additional**<br>**Paid-In Capital** |<br>**Accumulated Deficit** | **Accumulated Other**<br>**Income (Loss)** | **Total Shareholders'**<br> **Equity (Deficit)** |
| **Balance, March 31, 2024** | 154565756 | $15547 | 1262074 | $126 | 7020 | &nbsp;&nbsp;&nbsp;&nbsp; - | 37444 | &nbsp;&nbsp;&nbsp;&nbsp; - | $41677999 | $(41572001) | $653028 | $774609 |
| Issuance of ordinary shares from conversion of preferred stock | (152750318) | (15275) |  |  |  |  | 22913 |  | 33525 |  |  | 18250 |
| Issuance of ordinary shares from exercise of warrants |  |  |  |  |  |  | 53450 |  |  |  |  |  |
| Issuance of ordinary shares for cash, net of costs |  |  |  |  |  |  | 34616 |  | 1453589 |  |  | 1453589 |
| Shared based compensation for equity-based awards |  |  |  |  |  |  | (1) |  | 252192 |  |  | 252191 |
| Foreign currency translation adjustment |  |  |  |  |  |  |  |  |  |  | (576440) | (576440) |
| Net Loss | - | - | - | - | - | - | - | - | - | (1954556) | - | (1954556) |
| **Balance June 30, 2024** | **1815438** | **182** | **1262074** | **126** | **7020** |  | **148422** | **-** | **43417305** | **(43526557)** | **76588** | **(32356)** |
| **Balance March 30, 2025** | 5667518 | 567 | 1262074 | 126 | 7020 |  | 566268 |  | 53905074 | (46518825) | (1227846) | 6159097 |
| Issuance of preferred stock for note conversion | 387305 | 39 |  |  |  |  |  |  | 1508128 |  |  | 1508167 |
| Issuance of ordinary shares from exercise of warrants |  |  |  |  |  |  | 2086054 |  |  |  |  |  |
| Share based compensation for equity-based awards |  |  |  |  |  |  |  |  | 225083 |  |  | 225082 |
| Foreign currency translation adjustment |  |  |  |  |  |  |  |  |  |  | 241796 | 241796 |
| Net Loss | - | - | - | - | - | - | - | - | - | 649238 | - | 649238 |
| **Balance June 30 2025** | **6054823** | **606** | **1262074** | **126** | **7020** | **-** | **2652322** | **-** | **55638285** | **(45869587)** | **(986050)** | **8783380** |
| Balance, December 31, 2023 | 162732288 | $16274 | 1262074 | $126 | 7020 |  | 21919 |  | $41434244 | $(39315551) | $491888 | $2626981 |
| Issuance of ordinary shares from conversion of preferred stock | (160916850) | (16092) |  |  |  |  | 24138 |  | 14092 |  |  | (2000) |
| Issuance of ordinary shares for exercise of warrants |  |  |  |  |  |  | 67749 |  |  |  |  |  |
| Issuance of common stock for cash net of issuance costo |  |  |  |  |  |  | 34616 |  | 1453589 |  |  | 1453589 |
| Issuance of stock upon vesting restricted stock |  |  |  |  |  |  |  |  |  |  |  |  |
| Share based compensation for equity based awards |  |  |  |  |  |  |  |  | 515380 |  |  | 515380 |
| Transaction costs related to note payable |  |  |  |  |  |  |  |  |  |  |  |  |
| Foreign currency translation adjustment |  |  |  |  |  |  |  |  |  |  | (415300) | (415300) |
| Net loss | - | - | - | - | - | - | - | - | - | (4211006) | - | (4211006) |
| **Balance, June 30, 2024** | **1815438** | $**182** | **1262074** | $**126** | **7020** | $**-** | **148422** | $**-** | $**43417305** | $**(43526557)** | $**76588** | $**(32356)** |
| **Balance, December 31, 2024** | 1815438 | $182 | 1262074 | $126 | 7020 | $- | 546268 | $- | $45510375 | $(44916779) | $(1248664) | $(654760) |
| Issuance of ordinary shares from conversion of preferred stock |  |  |  |  |  |  | 2106054 |  |  |  |  |  |
| Issuance of ordinary shares for exercise of warrants |  |  |  |  |  |  |  |  |  |  |  |  |
| Issuance of preferred stock for cash | 1540832 | 154 |  |  |  |  |  |  | 2999846 |  |  | 3000000 |
| Issuance of preferred stock for cryptocurrency | 2311248 | 231 |  |  |  |  |  |  | 5199769 |  |  | 5200000 |
| Issuance of series A4 preferred shares for note | 387305 | 39 |  |  |  |  |  |  | 1508128 |  |  | 1508167 |
| Share-based compensation |  |  |  |  |  |  |  |  | 450167 |  |  | 450167 |
| Transaction cost incurred |  |  |  |  |  |  |  |  | (30000) |  |  | (30000) |
| Foreign currency translation adjustment |  |  |  |  |  |  |  |  |  |  | 262614 | 262614 |
| Net loss | - | - | - | - | - | - | - | - | - | (952808) | - | (952808) |
| **Balance, June 30, 2025** | **6054823** | $**606** | **1262074** | $**126** | **7020** | $**-** | **2652322** | $**-** | $**55638285** | $**(45869587)** | $**(986050)** | $**8783380** |

---

---

| | |
|:---|:---|
| (\*) | Reflects reverse split of 10:1 as approved by the Board of Directors of Freight Technologies, Inc. on January 26, 2024, effective as of February 5, 2024; the reverse split of 1:25 as approved by the Board of Directors of Freight Technologies, Inc. on September 12, 2024, effective as of September 25, 2024; and the reverse split of 1:4 as approved by the Board of Directors of Freight Technologies, Inc. on April 18, 2025, effective as of May 27, 2025. |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FREIGHT TECHNOLOGIES, INC. AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(UNAUDITED)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended June 30, 2025** | **Six Months Ended June 30, 2024** |
| **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(952808) | $(4211006) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 210789 | 220246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | 450167 | 515380 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash interest | 18003 | 491976 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on the sale cryptocurrencies | 80057 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (1761635) | (887494) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unbilled receivables | (279313) | 280617 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in convertible note fair value |  | (22602) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in fair value of cryptocurrency | (2427754) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expense and other assets | 124526 | 195723 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (160057) | (292155) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | (261143) | (1138213) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax payable | (80049) | (9598) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | (5039217) | (4857126) |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of cryptocurrencies | (2748777) |  |
| &nbsp;&nbsp;&nbsp;Sale of cryptocurrencies | 1920064 |  |
| &nbsp;&nbsp;&nbsp;Capitalization of software development costs | (156118) | (171997) |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment | - | (1882) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities | (984831) | (173879) |
| **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from notes payable, net of discounts | 2000000 | 873000 |
| &nbsp;&nbsp;&nbsp;Repayment of insurance financing payable | (70489) | (100464) |
| &nbsp;&nbsp;&nbsp;Repayment of short-term borrowings | (6103131) | (8150791) |
| &nbsp;&nbsp;&nbsp;Proceeds from short-term borrowings | 7611183 | 9848259 |
| &nbsp;&nbsp;&nbsp;Proceeds from the issuance of Series A4 Shares | 2970000 |  |
| &nbsp;&nbsp;&nbsp;Net proceeds from the issuance of Ordinary Shares | - | 1453589 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities | 6407563 | 3923593 |
| **Net increase (decrease) in cash and cash equivalents** | 383515 | (1107412) |
| Effect of exchange rate changes on cash and cash equivalents | (889) | 7883 |
| **Cash and cash equivalents at beginning of the period** | 204032 | 1560105 |
| **Cash, cash equivalents and restricted cash at end of the period** | $586658 | $460576 |
| **Supplemental disclosure of cash flow information** |  |  |
| Cash paid for interest | $325109 | $675628 |
| **Supplemental disclosure of non-cash activity** |  |  |
| Financing of insurance premiums | $180411 | $222891 |
| **Reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet** |  |  |
| Cash and cash equivalents | $586658 | $460576 |
| **Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows** | $586658 | $460576 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**NOTE 1 – DESCRIPTION OF BUSINESS**

Freight App, Inc. ("Fr8App") (formerly known as "Freighthub, Inc."), a Delaware corporation, was incorporated on October 26, 2015. On January 18, 2019, Freight App Mexico S.A De C.V. ("Fr8App Mexico") (formerly known as "Freight Hub Mexico S.A. De C.V."), a wholly owned subsidiary of Fr8App, was formed. On July 29, 2021, both companies filed their name change to Fr8App and Fr8App Mexico. On February 14, 2022, the Company merged with Hudson Capital Inc. (the "Merger"), and Fr8App Inc. was the surviving entity and then became listed on the Nasdaq stock exchange. Fr8App continued its operations under the name Freight Technologies Inc. ("Fr8Tech").

**NOTE 2 – LIQUIDITY AND GOING CONCERN**

Since inception, the Company has met its cash needs through proceeds from issuing convertible notes, loans, and issuance of shares. As shown in the accompanying consolidated financial statements as of and for the three months ended June 30, 2025, the Company has an accumulated deficit of $(45,869,587), a shareholders' equity of $8,783,380, net working capital of $(179,851), short-term debt (including borrowings and financing payable) of $4,961,684 and $586,658 of unrestricted cash on hand. For the six months ended June 30, 2025 the company has reported operating loss of $(2,935,072) and negative cash flows from operations of $(5,039,217), whereas for the same six months ended in 2024 the company reported operating losses of $(3,788,697) and negative cash flows from operations of $(4,857,126). The Company has historically met its cash needs through a combination of term loans, promissory notes, convertible notes, private placement offerings and sales of equity. The Company's cash requirements are generally for operating activities.

The Company currently projects that it will need to draw additional funds on its existing facilities and need additional capital to fund its current operations and capital investment requirements until the Company scales to a revenue level that permits cash self-sufficiency. As a result, the Company may need to raise additional capital or secure debt funding to support on-going operations until such time. This projection is based on the Company's current expectations regarding revenues, expenditures, cash burn rate and other operating assumptions. The sources of this capital are anticipated to be from drawing on existing facilities, and/or the sale of equity, any of which may not be achievable on favorable terms, or at all. Additionally, any debt or equity transactions may cause significant dilution to existing stockholders.

If the Company is unable to raise additional capital moving forward, its ability to operate in the normal course and continue to invest in its product portfolio may be materially and adversely impacted and the Company may be forced to scale back operations or divest some or all of its assets.

As a result of the above, in connection with the Company's assessment of going concern considerations in accordance with Financial Accounting Standard Board's ("FASB") Accounting Standards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern," management has determined that the Company's liquidity condition raises substantial doubt about the Company's ability to continue as a going concern through twelve months from the date these consolidated financial statements are available to be issued. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

**NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

**Basis of Presentation**

These consolidated financial statements and related notes are presented in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), expressed in U.S. dollars. The accompanying consolidated financial statements reflect all adjustments including normal recurring adjustments, which, in the opinion of management, are necessary to present fairly the financial position, results of operations, and cash flows for the periods presented in accordance with GAAP. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

**Use of Estimates**

The preparation of the consolidated 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 contingencies at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Such estimates include, but are not limited to, allowance for credit losses, valuation of share-based compensation and warrants, accounting for warrants, useful lives of internally developed software and property and equipment, fair value of convertible notes, impairment of long lived assets, whether an arrangement is or contains a lease, income tax accruals, the valuation allowance for deferred income taxes, and contingent liabilities.

The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that it believes are reasonable under the circumstances, including assumptions as to future events. Actual results could differ from those estimates.

**Cash and Cash Equivalents**

Cash consists of funds held in bank accounts. Cash equivalents consist of short-term, highly liquid investments with original maturities of 90 days or less at the time of purchase and generally include money market accounts.

**Concentrations of Credit Risk**

The Company maintains cash accounts with various financial institutions. At times, balances in these accounts may exceed federally insured limits. Accounts at each institution within the United States ("US") are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Additionally, a portion of the Company's cash is deposited in non-US accounts. The funds are held with financial institutions that offer deposit insurance and bear specific country and regional risks. The amounts over the insured limits as of June 30, 2025 and December 31, 2024 was $411,654 and $3,589, respectively. No losses have been incurred to date on any deposit balances.

The financial assets that potentially subject the Company to concentration of credit risk is accounts receivable and unbilled receivables. At June 30, 2025, one customer accounted for 69% of the Company's accounts receivable. As of December 31, 2024, one customer accounted for 88% of the Company's accounts receivable, respectively.

For the six months ended June 30, 2025, one customer accounted for 48% of the Company's revenues. For the six months ended June 30, 2024, one customer accounted for 46% of the Company's revenues.

**Fair Value Measurements**

The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), establishes a hierarchy of inputs used when available. Observable inputs are what market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are those that reflect the Company's assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances.

The three levels of the fair value hierarchy are described below:

Level 1— Inputs based on unadjusted quoted market prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2— Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable or can be corroborated by observable market data.

Level 3— Inputs reflect management's best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are both unobservable for the asset and liability in the market and significant to the overall fair value measurement.

**Fair Value of Financial Instruments**

The carrying amounts of the Company's financial instruments, which include trade accounts receivable, unbilled receivables, intangible assets, accounts payable, accrued expenses, and debt at variable interest rates, approximate their fair values at June 30, 2025 and December 31, 2024, respectively, principally due to the short-term nature, maturities, or nature of interest rates of the above listed items.

**Accounts Receivable and Allowance for Credit Losses**

Accounts receivable are recorded at the net invoiced amount, net of allowances for credit losses, and do not bear interest. Unbilled receivables, which are reflected separately on the accompanying consolidated balance sheets, include unbilled amounts for services rendered in the respective period but not yet billed to the customer until a future date, which typically occurs within one month. The allowance for credit losses is the Company's best estimate of the amount of probable credit losses in existing accounts receivable. In accordance with ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", the Company also considers reasonable and supportable forecasts of future economic conditions and their expected impact on customer collections in determining the allowance for credit losses. The Company determines expected credit losses based on historical write-off experience, an analysis of the aging of outstanding receivables, customer payment patterns, and our expectations of changes in macro-economic conditions, that may impact the collectability of outstanding receivables. Balances are considered past due based on invoiced terms. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of June 30, 2025 and December 31, 2024, the allowance for credit losses was $90,000 and $201,936, respectively.

**Long-Lived Assets**

The Company reviews its long-lived assets for impairment whenever events or circumstances exist that indicate the carrying amount of an asset or asset group may not be recoverable. Recoverability of assets is measured by comparing the carrying amounts of the assets to the future undiscounted cash flows expected to be generated by the assets. If the asset or asset group is considered to be impaired, an impairment loss would be recorded to adjust the carrying amounts to the estimated fair value. Management has determined that no impairment of long-lived assets exists, and accordingly, no adjustments to the carrying amounts of the Company's long-lived assets have been made for the six months ended June 30, 2025 and 2024.

**Property and Equipment**

Property and equipment consisting of office and computer equipment, furniture and leasehold improvements are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives, ranging between three to seven years.

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| | |
|:---|:---|
|  | **Useful Lives** |
| Equipment | 3 years |
| Furniture | 7 years |
| Leasehold improvements | Shorter of useful life of asset or lease term |

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**Capitalized Software**

The Company complies with the guidance of ASC Topic 350-40, *Intangibles—Goodwill and Other—Internal Use Software*, in accounting for of its internally developed system projects that it utilizes to provide its services to customers. These system projects generally relate to software of the Company that is not intended for sale or otherwise marketed. Internal and external costs incurred during the preliminary project stage are expensed as they are incurred. Once a project has reached the development stage, the Company capitalizes direct internal and external costs until the software is substantially complete and ready for its intended use. Costs for upgrades and enhancements are capitalized, whereas, costs incurred for maintenance are expensed as incurred. These capitalized software costs are amortized on a project-by- project basis over the expected economic life of the underlying software on a straight-line basis, which is generally three years. Amortization commences when the software is available for its intended use.

**Warrants**

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant's specific terms and applicable authoritative guidance in FASB ASC Topic 480, *Distinguishing Liabilities from Equity* ("ASC 480") and ASC Topic 815, *Derivatives and Hedging* ("ASC 815"). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company's own ordinary shares and whether the warrant holders could potentially require "net cash settlement" in a circumstance outside of the Company's control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

Warrants classified as liabilities are recorded at fair value and are remeasured at each reporting date until settlement. Changes in fair value are recognized as a component of change in fair value of warrant liability in the consolidated statements of operations. The fair value of the warrant liabilities is estimated using a Black-Scholes option pricing formula. The warrant volatility assumption within the Black-Scholes model represents a Level 3 measurement within the fair value measurement hierarchy. Warrants classified as equity instruments are initially recognized at fair value and are not subsequently remeasured.

The proceeds received from the sale of equity classified warrants and convertible notes in a bundled transaction are allocated based on the relative fair values of warrants and convertible notes with no changes in fair value of warrants recognized after the issuance date and were recorded at the issuance date using a relative fair value allocation method. Equity classified warrants, which are issued as an inducement to the holder of convertible note to covert the note, are recognized as an expense equal to the fair value of the warrant in accordance with ASC 470-20, Debt with Conversion and Other Options.

When equity classified warrants are issued to the convertible note holder as an additional consideration for the holder to provide additional funding under the existing convertible note agreement, the additional funding is allocated based on the residual fair value allocation method in which the fair value of the additional funding is first allocated to the convertible note and the remaining proceeds are allocated to the equity classified warrant.

**Advertising**

Advertising costs are expensed as incurred and totaled $2,563 and $556 for the six months ended June 30, 2025 and 2024, respectively.

**Income Taxes**

The Company accounts for income taxes using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax basis, net operating losses, tax credit and other carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates when the assets and liabilities are expected to be realized or settled. The Company regularly reviews deferred tax assets for realizability and establishes valuation allowances based on available evidence including historical operating losses, projected future taxable income, expected timing of the reversals of existing temporary differences, and appropriate tax planning strategies. If the Company's assessment of the realizability of a deferred tax asset changes, an increase to a valuation allowance will result in a reduction of net earnings at that time, while the reduction of a valuation allowance will result in an increase of net earnings at that time.

The Company follows ASC 740-10-65-1 in accounting for uncertainty in income taxes by prescribing rules for recognition, measurement and classification in financial statements of tax positions taken or expected to be in a tax return. This prescribes a two-step process for the financial statement measurement and recognition of a tax position. The first step involves the determination of whether it is more likely than not (greater than 50 percent likelihood) that a tax position will be sustained upon examination, based on the technical merits of the position. The second step requires that any tax position that meets the more likely than not recognition threshold be measured and recognized in the financial statements at the largest amount of benefit that is a greater than 50 percent likelihood of being realized upon ultimate settlement. This topic also provides guidance on the accounting for related interest and penalties, financial statement classification and disclosure. The Company's policy is that any interest or penalties related to uncertain tax positions are recognized in income tax expense when incurred. The Company has no uncertain tax positions or related interest or penalties requiring accrual at June 30, 2025 and December 31, 2024.

**Foreign Currency Translation**

The financial statements of the Company's subsidiary operating in Mexico are prepared to conform to U.S. GAAP and translated into U.S. Dollars by applying a current exchange rate. The local currency has been determined to be the functional currency. Assets and liabilities of non-U.S. operations are translated at period-end exchange rates. Items appearing in the consolidated statements of operations are translated using average exchange rates during each period. Translation gains and losses are reported in accumulated other comprehensive income (loss) as a component of stockholders' equity (deficit).

**Intangible Assets**

Intangible assets include the Company's domain name and are accounted for based on ASC Topic 350, *Intangibles – Goodwill and Other*. The Company's intangible assets that have finite lives, consisting of intellectual property, are amortized over their useful lives and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If any indicators were present, the Company would test for recoverability by comparing the carrying amount of the asset to the net undiscounted cash flows expected to be generated from the asset. If those net undiscounted cash flows do not exceed the carrying amount (i.e., the asset is not recoverable), the Company will perform the next step, which is to determine the fair value of the asset and record an impairment loss, if any. The Company evaluates the useful lives for these intangible assets each reporting period to determine whether events and circumstances warrant a revision in their remaining useful lives.

**Foreign Operations**

Operations outside the United States include a wholly-owned subsidiary in Mexico. Foreign operations are subject to risks inherent in operating under different legal systems and various political and economic environments. Among the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price or foreign exchange controls, and restrictions on currency exchange.

**Revenue Recognition**

The Company's revenues are accounted for under FASB ASC Topic 606, *Revenue from Contracts with Customers* ("ASC 606"). The Company generates revenues primarily from shipments executed by the Company's freight transportation brokerage services or dedicated capacity to shippers through the Company's freight marketplace.

*<u>Freight Transportation Brokerage Services</u>*

The Company's freight transportation brokerage services include Fr8App Full Truckload ("FTL"), providing a single customer the use of an entire truckload; Waavely, providing ocean container shipments through Mexican ports; and Fr8Now Less Than Truckload ("LTL"), providing multiple customers the use of a partial truckload in each truck. Shippers contract with the Company to utilize the Company's network of independent freight Carriers to transport freight. Those shipments are the Company's single performance obligations, arising under contracts the Company has entered into with customers that define the price for performance obligation and payment terms. The Company's acceptance of the shipment request establishes enforceable rights and obligations for each contract. By accepting the shipper's order, the Company has responsibility for transportation of the shipment from origin to destination. Under such contracts, revenue is recognized when performance obligations are satisfied, which generally represents the transit period from origin to destination by a third-party carrier which can vary based on origin and destination, or the capacity used. This is appropriate as the customer simultaneously receives and consumes the benefits as the Company performs its obligation. The Company determines revenue in-transit using the output method based on shipping milestones. Measure of revenue in-transit requires the application of judgment. Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services. Accessorial charges for fuel surcharge, loading and unloading, stop charges, and other immaterial charges are part of the consideration received for the single performance obligation of delivering shipments.

*<u>Dedicated Capacity Services</u>*

The Company provides customers with dedicated shipment capacity for a specific period of time under Fr8Fleet. The current arrangements under Fr8Fleet include an obligation to provide weekly shipping capacity. The Company's performance obligation in this arrangement is to provide the shipping capacity and the transaction price is fixed. Under such contracts, revenue is recognized when performance obligations are satisfied, which generally represents when trucks are provided to the shipper over the term of the agreement. The Company utilizes the output method for revenue recognition based on direct measurements of the value transferred to the customer, which is the number of trucks provided to the customer per day. Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services.

Payment for the Company's services is generally due within 30 to 45 days upon delivery of the shipment. Contracts entered into with customers do not contain material financing components. The Company's contracts with customers typically have a duration of one year or less and do not require any significant start-up costs, and as such, costs incurred to obtain contracts associated with these contracts are expensed as incurred.

Through the Company's freight brokerage services and dedicated capacity, the Company is responsible for identifying and directing independent freight Carriers to transport the shipper's goods. The transportation of the loads is outsourced to third-party Carriers. The Company is a principal in these arrangements, and therefore records revenue associated with these contracts on a gross basis. The Company controls the service and has primary responsibility to meet the customer's requirements. The Company invoices and collects from its customers, maintains discretion over pricing and is responsible for resolving customer claims.

Additionally, the Company is responsible for selection of third-party transportation providers to the extent used to satisfy customer freight requirements. At times, billing occurs subsequent to revenue recognition, resulting in an unbilled receivable which represents a contract asset. This contract asset is recorded as an unbilled receivable and presented on the consolidated balance sheets. The Company receives the unconditional right to bill when shipments are delivered to their destination.

A summary of the Company's revenue by major service lines is as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **3 Months Ended June 30** | **3 Months Ended June 30** | **6 Months Ended June 30** | **6 Months Ended June 30** |
|  | **2025** | **2024** | **2025\*** | **2024** |
| Freight Transportation Brokerage | $2106496 | $2165808 | $4741667 | $4675171 |
| Dedicated Capacity | 883414 | 1672034 | 2348883 | 3450431 |
| **Total Revenue** | $**2989910** | $**3837842** | $**7090550** | $**8125602** |

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\* To note, for the six months ended June 30, 2025, Q1 2025 revenue by service line has been adjusted to correct for an immaterial error in the classification of revenue between services. Previously, $46,323 of Q1 2025 revenue was reported as Dedicated Capacity, when it should have been reported as Freight Transportation Brokerage. This adjustment has no impact to reported revenue or net income.

**Share-Based Compensation**

The Company accounts for share-based awards, including stock options and restricted stock awards, issued to employees in accordance with ASC Topic 718, *Compensation—Stock Compensation*. In addition, the Company issues stock options to non-employees in exchange for consulting services and accounts for these in accordance with the provisions of ASU 2018-07, *Improvements to Nonemployee Share-Based Payment Accounting*. Compensation expense is measured at the grant, based on the calculated fair value of the award, and recognized as an expense over the requisite service period, which is generally the vesting period of the award.

For modification of stock compensation awards, the Company records the incremental fair value of the modified award as share-based compensation on the date of modification for vested awards or over the remaining vesting period for unvested awards. The incremental compensation is the excess of the fair value of the modified award on the date of modification over the fair value of the original award immediately before the modification. In addition, the Company records the remaining unrecognized compensation cost for the original cost for the original award on the modification date over the remaining vesting period for unvested awards.

The Company estimates the expected term of stock options granted to employees using the simplified method, whereby the expected term equals the average of the vesting term and the original contractual term of the option. The Company utilizes this method as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. For stock options granted to non-employees, the contractual term of the option is utilized as the basis for the expected term assumption. All other assumptions used to calculate the grant date fair value are generally consistent with the assumptions used for options granted to employees. For purposes of calculating share-based compensation, the Company estimates the fair value of stock options using a Black-Scholes option-pricing model. The determination of the fair value of share-based payment awards utilizing the Black-Scholes model is affected by the Company's stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The expected volatility is primarily based on the historical volatility of peer company data while the expected life of the stock options is based on historical and other economic data trended into the future. The risk-free interest rate is based on U.S. Treasury yield curve in effect at the time of grant for periods corresponding to the expected option term. The dividend yield assumption is based on the Company's history and expectation of no dividend payouts.

If factors change and the Company employs different assumptions, share-based compensation expense may differ significantly from what has been recorded in the past. If there is a difference between the assumptions used in determining share-based compensation expense and the actual factors which become known over time, specifically with respect to anticipated forfeitures, the Company may change the input factors used in determining share-based compensation costs for future grants. These changes, if any, may materially impact the Company's results of operations in the period such changes are made. Incremental compensation costs arising from subsequent modifications of awards after the grant date are recognized when incurred. In addition, the Company accounts for forfeitures of awards as they occur. For share-based awards that vest based on performance conditions, expense is recognized when it is probable that the conditions will be met.

**Earnings Per Share**

Basic earnings (loss) per share is computed by dividing net income (loss) available to ordinary shareholders by the weighted average number of outstanding ordinary shares for the period, considering the effect of the securities series A and B preferred stock and series seed preferred stock. Diluted earnings (loss) per share is calculated by dividing net earnings (loss) by the weighted average number of ordinary shares and dilutive ordinary shares equivalents outstanding. During the periods when they are anti-dilutive, ordinary share equivalents including those from warrants and convertible notes, if any, are not considered in the computation. At June 30, 2025 and December 31, 2024, there were 27,621,956 and 4,016,706 ordinary share equivalents, respectively, which were anti-dilutive.

**Segments**

Operating segments are defined as components of an entity for which separate financial information is available. The Chief Operating Decision Maker ("CODM"), CEO Javier Selgas, reviews financial information presented on a consolidated basis for the purposes of making operating decisions, allocating resources, and evaluating financial performance. As such, the Company has determined that it operates in one operating and one reportable segment. The Company presents financial information about its operating segment and geographical areas in Note 13 to the consolidated financial statements.

**Reclassifications**

Financial statements presented for prior periods include reclassifications that were made to conform to the current year presentation. There was no material impact to the consolidated financial statements for these changes.

**Recently Issued Accounting Pronouncements**

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to reportable Segment Disclosures (ASU 2023-07), which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses and by extending the disclosure requirements to entities with a single reportable segment. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. ASU 2023-07 is to be applied retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The adoption of ASU 2023-07 has not had a material impact on our financial statements, see "Segments" section of Note 3, Summary of Significant Accounting Policies.

On December 13, 2023, the FASB issued ASU 2023-08, which addresses the accounting and disclosure requirements for certain crypto assets. The new guidance requires entities to subsequently measure certain crypto assets at fair value, with changes in fair value recorded in net income in each reporting period. In addition, entities are required to provide additional disclosures about the holdings of certain crypto assets. For all entities, the ASU's amendments are effective for fiscal years beginning after December 15, 2024, including interim periods within those years. The Company adopted ASU 2023-08 for the period ending March 31, 2025.

**Accounting Standards Issued But Not Adopted as of June 30, 2025**

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, an update that improves income statement expense disclosure requirements. Under ASU 2024-03 issuers will be required to incorporate new tabular disclosures disaggregating prescribed expense categories within relevant income statement captions in the notes to their financial statements. These categories include purchases of inventory, employee compensation, depreciation and intangible asset amortization. The amendments are effective for fiscal years beginning after December 15, 2026, and should be applied prospectively. The adoption of ASU 2024-03 will require us to provide additional disclosures related to certain income statement expenses but otherwise will not materially impact our financial statements.

All other new accounting pronouncements that have been issued, but not yet effective are currently being evaluated and at this time are not expected to have a material impact on our consolidated financial statements.

**NOTE 4 – CAPITALIZED SOFTWARE**

Capitalized software consists of the following at:

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| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,<br> 2024** |
| Capitalized software | $3991247 | $3729011 |
| Accumulated amortization | (3426824) | (3154902) |
| Capitalized software, net | $564423 | $574109 |

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Amortization expense for the six months ended June 30, 2025 and 2024 was $205,939 and $212,306 respectively.

Estimated amortization for capitalized software for future periods is as follows:

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| | |
|:---|:---|
| 2025 (July 1 – December 31) | $220284 |
| 2026 | 207266 |
| 2027 | 103763 |
| 2028 | 10753 |
|  | $542066 |

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**NOTE 5 – PROPERTY AND EQUIPMENT**

Property and equipment consist of the following at:

SCHEDULE OF PROPERTY AND EQUIPMENT, NET

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| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,<br> 2024** |
| Equipment | $102228 | $98598 |
| Furniture and fixtures | 9517 | 9517 |
| &nbsp;&nbsp;&nbsp;Total cost | 111745 | 108115 |
| Accumulated depreciation | (102304) | (94877) |
| **Property and equipment, net** | $**9441** | $**13238** |

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Depreciation expense for the six months ended June 30, 2025 and 2024 was $4,443 and $7,533 respectively.

**NOTE 6 – CRYPTOCURRENCIES**

As of June 30, 2025, the Company held the following cryptocurrencies:

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| | | | |
|:---|:---|:---|:---|
| **Cryptocurrency** | **Units** | **$/ Unit** | **Fair Market Value ($ USD)** |
| FET | 11714720.85 | $0.68 | $7966010 |
| Official Trump | 45680.01 | 8.97 | 409750 |
| Ethereum | 0.0399 | 2476.41 | 99 |
| Solana | 3.5072 | 157.08 | 551 |
| **Total** |  |  | $**8376410** |

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On March 31, 2025, the Company entered into a Securities Purchase Agreement with Fetch Compute, Inc. wherein the Company sold and the Purchaser purchased 2,311,248 Series A4 preferred shares of the Company, par value $0.0001 per share for a total purchase price of approximately $5,200,000 payable in 11,300,000 FET Tokens. As part of the agreement with Fetch Compute, the Company agreed to purchase additional FET tokens worth 20% of the net proceeds from subsequent equity financing events. On May 27, 2025, the Company effectively received $1,508,167 in proceeds from the exchange of previously issued convertible notes into Series A4 preferred shares to Trump Ventures I, LLC. Subsequently, the Company purchased 414,721 FET tokens for approximately $300,000.

FET tokens are the utility token and the key medium of exchange on the Fetch.ai network. These tokens meet the definition of a crypto asset under ASC 350-60 and are accounted for as intangible assets measured at fair value, with changes in fair value recognized in net income each reporting period. For the three months ending June 30, 2025, the unrealized gain in the fair value of the FET tokens was $2,466,010. The FET tokens are classified as Level 1 fair value measurements under ASC 820, as fair value is determined based on quoted prices on active markets.

On April 29, 2025, the Company entered into a Securities Purchase Agreement with certain accredited investors wherein the Company agreed to sell and the buyers agreed to purchase senior $1 million of convertible notes and warrants to purchase additional notes of up to $19 million for a total purchase price up to $20,000,000. The Company will use the net proceeds from the Offering to purchase TRUMP coins. On May 12, 2025, the buyers exercised $1 million of warrants to purchase additional convertible notes. On May 27, 2025, the buyers exercised their right to convert $1.5 million of the convertible notes into Series A4 preferred shares. As of June 30, 2025, $500,000 of the convertible notes remained outstanding.

Pursuant to this agreement the Company purchases 170,172 Official Trump coins for $2,000,000. After the conversion of the convertible notes, the Company sold 124,492 Official Trump coins, and held 45,680 as of June 30, 2025.

Cryptocurrencies are subject to significant risks, including market volatility, liquidity constraints, and regulatory uncertainty. The Company does not currently hedge its exposure to crypto asset price fluctuations and may be subject to gains or losses in future reporting periods

**NOTE 7 – ACCRUED EXPENSES**

Accrued expenses consist of the following at:

SCHEDULE OF ACCRUED EXPENSES

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| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,<br> 2024** |
| Accrued freight costs | $749334 | $890408 |
| Accrued payroll | 345175 | 362628 |
| Accrued interest on convertible note | 9834 |  |
| Accrued professional services | 35951 | 24000 |
| Other accrued liabilities | 3526 | 3527 |
| **Total accrued expenses** | $**1143820** | $**1280563** |

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**NOTE 8 – SHARE-BASED COMPENSATION**

The Company has an Equity Incentive Plan (the "Plan") under which the Company may grant restricted stock awards and stock options for up to 150,000 ordinary shares. Both incentive stock options and non-qualified stock options expire ten years from the date of the grant or 90 days after the termination of employment of the grantee. For further information on the Company's stock-based compensation plans, refer to Note 7 of the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.

**NOTE 9 – SHORT-TERM BORROWINGS AND NOTES PAYABLE**

**Short-Term Borrowings**

On March 7, 2019, the Company entered into a short-term promissory note ("2019 Note") with a lender (the "2019 Note Lender") which provides the Company a revolving line of credit. On July 12, 2022, the note was amended to increase the maximum principal amount that could be advanced withdrawn under the line of credit to $5,000,000. On May 24, 2024, the note was amended to temporarily increase the maximum principal amount that could be advanced withdrawn under the line of credit to $5,250,000 until June 30, 2024.

The borrowing base of the revolving line of credit is limited to stated percentages for different categories of eligible accounts receivable. Under the revolving line of credit, if the aggregate principal amount of the outstanding advances exceeds the applicable borrowing base, the Company must repay the lender an amount equal to the difference between the outstanding principal balance of the revolving line of credit and the borrowing base. The note requires monthly payments of interest. Interest accrues on the outstanding principal at a rate equal to the greater of a floor rate of 5.25% per annum and the Prime Rate as set out in the Wall Street Journal (WSJ) plus 1%; a collateral management fee of 0.6% per month; and, 0.25% per annum on the unused portion of the line. The WSJ Prime Rate was 7.5% as of June 30, 2025.

The outstanding principal amount on short-term borrowings is $4,851,762 and $3,343,710 as of June 30, 2025 and December 31, 2024, respectively. The Company incurred interest expense related to the short-term borrowings in the amount of $320,305 and $357,599 for the six months ended June 30, 2025 and 2024, respectively.

**Notes Payable**

On March 11, 2024, the Company entered into a Term Note Purchase Agreement with Freight Opportunities LLC to secure a term loan of $750,000. This loan is for a duration of one year and accrues interest at a rate of 8% per annum, which is reset daily.

On June 4, 2024, the Company executed another Term Note Purchase Agreement with Freight Opportunities LLC, resulting in an additional term loan of $125,000. This loan also has a one-year term and accrues interest at the same rate of 8% per annum, which is reset daily.

The Company has the option to prepay the term loans, in whole or in part, without incurring any penalties.

On September 3, 2024, the Company entered into a Cancellation Agreement with Freight Opportunities, LLC to cancel the principal and interest outstanding under the Term Note Purchase Agreement of $905,861. This was reported as a gain from extinguishment of debt in the consolidated statements of operations for the year ended December 31, 2024.

**NOTE 10 – CONVERTIBLE DEBT**

On January 3, 2023, the Company and Freight Opportunities LLC (the "Noteholder") entered into a Securities Purchase Agreement pursuant to which the Company issued to the Noteholder a convertible promissory note in the principal amount of up to $6,593,407 (the "2023 Convertible Note" or the "Note"). The Note carried an original issue discount of nine percent (9%), or in the aggregate, up to $593,407 (the "OID"). The Note has a maturity date of January 3, 2029.

On September 3, 2024, the Company entered into a Cancellation Agreement with Freight Opportunities, LLC to cancel the fair value of $219,840 and interest outstanding of $482,103 under the Convertible Note. This was accounted for as a gain on extinguishment of debt on the consolidated statement of operations for the year ended December 31, 2024.

The Company recorded interest expense pursuant to the stated interest rates on the Note in the amounts of $0 and $24,583 for the six months ended June 30, 2025 and June 30, 2024, respectively.

On April 29, 2025, the Company entered into a Securities Purchase Agreement with certain accredited investors wherein the Company agreed to sell and the buyers agreed to purchase senior $1 million of convertible notes and warrants to purchase additional notes of up to $19 million for a total purchase price up to $20,000,000. The Company will use the net proceeds from the Offering to purchase TRUMP coins. On May 12, 2025, the buyers exercised $1 million of warrants to purchase additional convertible notes. On May 27, 2025, the buyers exercised their right to convert $1.5 million of the convertible notes into Series A4 preferred shares. As of June 30, 2025, $500,000 of the convertible notes remained outstanding. For the three months ending June 30, 2025, the Company accrued interest of $9,834 related to the convertible notes outstanding.

**NOTE 11 – INCOME TAXES**

Income tax provisions for interim periods are generally based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent, or unusual items related specifically to interim periods. Income tax expense of $22,324 and $40,379 was recognized for the six months ended June 30, 2025, and 2024, respectively. The Company had a full valuation allowance against its deferred income tax assets as of June 30, 2025, and December 31, 2024.

**NOTE 12 – LEASES**

In November 2022, Fr8App entered into a lease agreement for 31 workstations in Monterrey, Mexico for a 12 month-term, and amended the lease for additional adjacent office space in August 2023. In November 2023 and again in November 2024, the Company renewed their lease agreement for additional 12-month terms, respectively. The current lease agreement will expire on October 31, 2025.

The Company entered into a lease agreement for office space in Mexico City to accommodate three to five employees on February 1, 2024. That lease was renewed on February 1, 2025. In October 2020, the Company entered into a work-suites arrangement for a workspace in an office located in The Woodlands, Texas, on a month-to-month basis, which continues in effect.

Total rent expense for the six months ended June 30, 2025 and 2024, was approximately $70,325 and $73,597, respectively.

**NOTE 13 – SEGMENT INFORMATION**

Geographic long-lived asset information presented below is based on the physical location of the assets, and in the case of our cryptocurrencies, the location of the legal entity in which they are held, at the end of the period. Long-lived assets including intangible assets, which includes cryptocurrencies, capitalized software, property and equipment, and security deposits, by geographic region, are as follows at:

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| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **June 30,<br> 2024** |
| United States | $8458286 | $119348 |
| Mexico | 504945 | 591021 |
| Total long-lived assets | $8963231 | $710369 |

---

The following table summarizes the Company's total revenue by geographic area based on the billing address of the customers:

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended June 30,** | **Six Months Ended June 30,** |
|  | **2025** | **2024** |
| United States | $2434001 | $3082170 |
| Mexico | 4656549 | 5043432 |
| Total revenue | $7090550 | $8125602 |

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**NOTE 14 – WARRANTS**

The table below summarizes the Company's warrant activities for the first six months of 2025:

SUMMARY OF WARRANT ACTIVITY

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of Ordinary <br>Shares**<br>**Warrants**<br>**(\*)** | **Number of Series <br>A, B, C, D**<br>**Warrants**<br>**(\*)** | **Number of**<br>**Series Seed**<br>**Shares**<br>**Warrants** | **Exercise<br> Price**<br> **Range**<br>**Per Share** | **Weighted Average**<br>**Exercise**<br>**Price** |
| Balance at December 31, 2024 | 4185112 | 133 | 4165 | $2.17 to $86,713.38 | $2.30 |
| Granted |  |  |  |  |  |
| Forfeited |  |  |  |  |  |
| Converted |  |  |  |  |  |
| Exercised | (2476471) |  |  |  |  |
| Adjustments due to triggering events | 26440275 | - | - |  |  |
| **Balance at June 30, 2025 (Unaudited)** | **28148916** | **133** | **4165** | $**2.17 to $86,713.38** | $**2.30** |

---

---

| | |
|:---|:---|
| (\*) | Ordinary and preferred share warrant amounts and exercise prices have been adjusted to reflect the May 27, 2025 one to four reverse stock split. |

---

The Ordinary shares warrants carry a cashless exercise feature in which if the resale by the holder of the warrant shares issuable upon exercise of the warrants is not available to be issued to the warrant holder without legend or other restrictions, the warrant holder can elect to receive upon such exercise the higher of (i) 0.85 Ordinary shares per warrant share in such exercise and (ii) the "Net Number" of Ordinary shares (as defined in the warrant agreement). The exercise price and number of Ordinary warrant shares issuable upon exercise are subject to adjustment from time to time, for share dividends and splits, upon issuance of Ordinary shares, options, convertible securities and changes in option price or rate of conversion.

During the six months ended June 30, 2025, 2,594,118 Ordinary Share warrants were exercised for 2,185,000 Ordinary Shares based on a conversion ratio of 0.85.

Series A, B, C, and D Warrants conversion ratios are 0.779, 0.816, 0.888, and 0.826, respectively.

During the year ended December 31, 2024, 1,732,081 Ordinary Share warrants were exercised for 1,472,269 Ordinary Shares based on a conversion ratio of 0.85.

The ordinary shares and warrants in these conversions have been adjusted for the February 5, 2024 1:10 reverse stock split, the September 25, 2024 1:25 reverse stock split, and the May 27, 2025 1:4 reverse stock split.

**NOTE 15 - DEFINED CONTRIBUTION PLAN**

The Company has a defined contribution plan covering eligible employees with at least two months of service. The Company fully matches employee contributions up to 3% of total compensation, plus 50% of contributions that exceed that amount up to 5% of total compensation. Total expenses for six months ended June 30, 2025 and 2024, was $8,812 and $3,211, respectively.

**NOTE 16 – STOCKHOLDERS' EQUITY**

On the date of the Merger, the Company adopted Hudson's Memorandum and Articles of Association ("MAA"). On March 23, 2023, the MAA was amended by the Company, and further amended on June 30, 2023, February 2, 2024, June 12, 2024, January 24, 2025, January 31, 2025 and on June 27, 2025.

The Company is authorized under the MAA as amended, to issue an unlimited number of shares divided as follows:

SCHEDULE OF PREFERRED AND COMMON STOCK AUTHORIZED

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| | | |
|:---|:---|:---|
|  | **Number of**<br>**Shares** | **Par Value Per<br> Share** |
| Ordinary Shares | Unlimited | No par value |
| Series Seed Preferred Shares | 25000 | $0.0001 |
| Series A1A Preferred Shares | 10000000 | $0.0001 |
| Series A2 Preferred Shares | 3000000 | $0.0001 |
| Series A4 Preferred Shares | Unlimited | $0.0001 |
| Series B Preferred Shares | 21000000 | $0.0001 |
| Blank Check Preferred Shares | Unlimited | No par value |

---

Holders of Ordinary Shares are entitled to one vote for each share of Ordinary Share held at all meetings of stockholders. The holders of Preferred Shares shall not be entitled to vote on any resolution of shareholders, except in relation to a variation of the rights of the Preferred Shares.

The MAA contained certain restrictions on the Company's ability to pay dividends on its Ordinary Shares without also simultaneously paying dividends on the Preferred Shares. The holders Preferred Shares shall be entitled to receive dividends equal (on an as-if-converted-to-Ordinary Shares basis) to and in the same form as dividends actually paid on Ordinary Shares when, as and if such dividends are paid on Ordinary Shares.

The Preferred Shares are convertible, at the option of the holder thereof, at any time into such number of fully paid and non-assessable Ordinary Shares at the applicable Conversion Price as detailed in the MAA and subject to certain adjustments such as reorganization, recapitalization, reclassification, consolidation, distributions payable in Ordinary Shares, subdivision or combination of Ordinary Shares.

In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the assets of the Company available for distribution to its stockholders or, in the case of a Deemed Liquidation Event (as defined in the MAA) the consideration or proceeds available for distribution, as the case may be, were to be distributed to the holders of Preferred Shares and the holders of Ordinary Shares, pro rata based on the number of shares held by each shareholder, treating for this purpose all such securities as if they had been converted to Ordinary Shares pursuant to the terms of the MAA immediately prior to such liquidation, dissolution or winding up of the Company.

As long as any of the Preferred Shares are outstanding, the Company shall not do certain actions, including changing certain rights of Preferred Shares without the written consent or affirmative approval of the holders of a majority of the then outstanding of each class of Preferred Shares.

*<u>Issuances of Shares During the Year Ended December 31, 2024</u>*

The Company issued a total 24,138 ordinary shares from conversion of 160,916,850 Series A4 preferred shares at a conversion ratio of 0.00015.

*<u>Offering of Shares</u>*

During the year ended December 31, 2024, the Company entered into an At The Market ("ATM") Offering Agreement to offer and sell shares of our Ordinary Stock having an aggregate offering price of up to $2,300. Under this offering we issued and sold 528,576 shares, for gross proceeds of $3,210,075 and net proceeds of $3,079,016 after deducting commissions and offering expenses of $131,059.

*<u>Restructuring of Par Value</u>*

On June 12, 2024, in connection with the offering of the Shares, the Company effected a restructuring of par value of ordinary shares (the "Restructuring of Par Value") and filed an Amended and Restated Memorandum and Articles of Association with the Registrar of Corporate Affairs in the British Virgin Islands, to decrease the par value of the Company's ordinary shares outstanding from $1.10 per share to no par value each. The Restructuring of Par Value affected all the shareholders of ordinary shares uniformly. The Restructuring of Par Value did not affect the number of the Company's authorized shares.

The different classes of preferred stock issued are set forth below:

SCHEDULE OF PREFERRED STOCK ISSUED

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| | | |
|:---|:---|:---|
|  | **June 30, 2025** | **December 31, 2024** |
| Series Seed Preferred Shares | 7020 | 7020 |
| Series A1A Preferred Shares | 1169845 | 1169845 |
| Series A2 Preferred Shares | 634978 | 634978 |
| Series A4 Preferred Shares | 4250000 | 10615 |
| Series B Preferred Shares | 1262074 | 1262074 |
| Total | 7323917 | 3084532 |

---

*<u>February 5, 2024 Reverse Stock Split</u>*

The Company effected a one for ten reverse stock split on February 5, 2024. All classes of preferred shares were not subject to this reverse stock split prior to conversion to ordinary shares. The ordinary shares to which the preferred shares are convertible to, are adjusted accordingly upon conversion of the preferred shares.

*<u>September 25, 2024 Reverse Stock Split</u>*

The Company effected a one for twenty-five reverse stock split on September 25, 2024. All ordinary shares and per ordinary share information in these condensed consolidated financial statements has been retroactively adjusted to reflect this reverse stock split. All classes of preferred shares were not subject to this reverse stock split prior to conversion to ordinary shares. The ordinary shares to which the preferred shares are convertible to, are adjusted accordingly upon conversion of the preferred shares.

*<u>May 27, 2025 Reverse Stock Split</u>*

The Company effected a one for four reverse stock split on May 27, 2025. All ordinary shares and per ordinary share information in these condensed consolidated financial statements has been retroactively adjusted to reflect this reverse stock split. All classes of preferred shares were not subject to this reverse stock split prior to conversion to ordinary shares. The ordinary shares to which the preferred shares are convertible to, are adjusted accordingly upon conversion of the preferred shares.

*<u>Entry into Material Definitive Agreement</u>*

On February 3, 2025, the Company completed a private placement with certain investors, wherein a total of 1,540,832 Series A4 preferred shares of the Company, par value $0.0001 per share (the "Preferred Shares"), with each investor receiving 770,416 Preferred Shares, for a total purchase price of approximately $3,000,000 (the "Offering"). The Offering raised net cash proceeds of approximately $2.9 million (after deducting the transfer agent and legal fees and expenses of the Offering). The Company intends to use the net cash proceeds from the Offering for working capital and corporate purposes. Pursuant to the Amended and Restated Memorandum and Articles of Association filed with the Registrar of Corporate Affairs of the British Virgins Islands on January 31, 2025 (the "Amended and Restated M&A**"**), each Preferred Share is immediately convertible on the date of issuance, by dividing the respective Series A Reference Price (as defined in the Amended and Restated M&A) of such Preferred Share by the applicable conversion price (the "Preferred Shares Conversion Price") at the option of the shareholder thereof, at any time and from time to time, and without the payment of additional consideration by the shareholder thereof, into such number of fully paid and non-assessable ordinary shares, with no par value per share, of the Company (the "Ordinary Shares"). Pursuant to the Amended and Restated M&A, the Preferred Shares Conversion Price shall be the greater of (i) the lowest daily VWAP (as defined in the Amended and Restated M&A) of the Ordinary Shares in the seven (7) consecutive Trading Day (as defined in the Amended and Restated M&A) period immediately preceding the date of the conversion of the applicable Preferred Share and (ii) the Series A4 Conversion Price Floor (as defined in the Amended and Restated M&A).

In connection with the Offering, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with the investors containing customary representations and warranties. Pursuant to the Purchase Agreement the Company will be required to file a resale registration statement (the "Registration Statement") with the Securities and Exchange Commission (the "SEC") to register for resale the Ordinary Shares issuable upon conversion of the Preferred Shares, no later than March 30, 2025, and shall use its commercially reasonable efforts to cause such Registration Statement to become effective at the as soon as possible thereafter, but in any event no later than 90 days of the Closing Date (as defined under the Purchase Agreement). The Company will be obliged to pay certain liquidated damages to the investors if the Company fails to file the Registration Statement when required, fails to file or cause the Registration Statement to be declared effective by the SEC when required, or fails to maintain the effectiveness of the Registration Statement pursuant to the Securities Purchase Agreement. The maximum amount of such liquidated damages payable shall not exceed 20% of the aggregate reference price of the Preferred Shares sold hereunder.

*<u>Entry into Material Definitive Agreement</u>*

On March 31, 2025, the Company entered into a Securities Purchase Agreement, dated as of March 31 2025 with Fetch Compute, Inc. wherein the Company sold and the Purchaser purchased 2,311,248 Series A4 preferred shares of the Company, par value $0.0001 per share for a total purchase price of approximately $5,200,000 payable in 11,300,000 FET Tokens.

*<u>Entry into Material Definitive Agreement</u>*

On April 29, 2025 the Company entered into an agreement for the issuance of convertible notes through a facility of up to USD $20 million with an institutional investor. Capital from the financing is exclusively earmarked for purchasing Official Trump Tokens ($TRUMP). On May 2, 2025, pursuant to the financing, the Company issued two notes in the aggregate principal amount of USD $1 million. On May 9, 2025, the Company issued two additional notes for an aggregate amount of $1 million, bringing the total amount of notes issued under the facility to $2 million. The Company completed the purchase of $2 million of the $TRUMP coins, pursuant to the terms of the notes. As of May 15, 2025, the facility had additional capacity of up to $18 million available in subsequent drawdowns, subject to certain conditions.

On May 27, 2025, the buyers exercised their right to convert $1.5 million of the convertible notes into 387,305 Series A4 preferred shares. As of June 30, 2025, $500,000 of the convertible notes remained outstanding.

**NOTE 17 – COMMITMENTS AND CONTINGENCIES**

**Legal**

The Company is subject, from time to time, to claims by third parties under various legal disputes. Defending such claims, or any adverse outcome relating to any such claims, could have a material adverse effect on the Company's liquidity, financial condition, and cash flows. As of June 30, 2025, the Company did not have any pending legal actions.

**NOTE 18 - SUBSEQUENT EVENTS**

Management has evaluated subsequent events through August 18, 2025 the date that the consolidated financial statements were available for issuance.

On July 11, 2025, the Company entered into a twelfth amendment to its loan documents with Capital Foundry Funding LLC governing its revolving line of credit. The amendment reaffirmed a $5 million capacity including $4 million in overline availability, if necessary, at the discretion of Capital Foundry based on certain facts and circumstances concerning the Company's accounts receivables and unbilled receivables. The amendment also clarified the definition of unbilled accounts for eligibility, set an overline fee of $37,000 to be paid in four installments by October 2025, and set the maturity date to March 7, 2027, unless extended further. The facility automatically renews for successive one year periods unless either party terminates by providing 90-day notice.

On July 18, 2025, Freight Opportunities, LLC exercised 117,647 Ordinary Share warrants for 100,000 Ordinary shares on a cashless basis.

On August 6, 2025, the Company entered into a securities purchase agreement with an accredited wherein the Company issued an aggregate of (i) 12,540,000 series B preferred shares; and (ii) 126,005 series A4 preferred shares for a total purchase price of $500,000. The Offering raised net cash proceeds of approximately $485,000 after deducting the transfer agent and legal fees and expenses.

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

*The following management's discussion and analysis of financial condition and results of operations provides information that management believes is relevant to an assessment and understanding of our plans and financial condition. The following financial information is derived from our financial statements and should be read in conjunction with such condensed financial statements and notes thereto set forth elsewhere herein.*

**Use of Terms**

Except as otherwise indicated by the context and for the purposes of this Quarterly Report on Form 10-Q:

● "3PL" refers to third party logistics services, a term used to describe services that help merchants manage their supply chain. Common 3PL services include freight services, warehouse and inventory management, order fulfillment, shipping coordination, retail distribution, exchanges, and returns;

● "AI" refers to artificial intelligence;

● Amended Memorandum and Articles" refer to the amended and restated memorandum and articles of association in force on the date of this Quarterly Report;

● "BVI Act" refers to the BVI Business Companies Act (As Revised);

● "China" or "PRC" refers to the People's Republic of China, and solely for the purpose of this Quarterly Report, excluding Taiwan, Hong Kong and Macau;

● "Fr8App" refers to Freight App, Inc., our primary operating subsidiary and where applicable, the brand name of our platform focused on FTL;

● "FTL" refers to full truckload freight. FTL freight is used for shipments that require taking up the space available on an entire truck. With FTL, a single shipper's goods are the only freight moving on an individual truck. FTL can be provided on a variety of trucks depending on the underlying goods being transported, i.e., a dry van, refrigerated, flatbeds and others;

● "LTL" refers to less than truckload freight. LTL is used for shipments when multiple shippers' freight is on the same trailer rather than having a single company's freight exclusively on an individual trailer. Several LTL shipments are combined into one truck to fill it as near to capacity as possible, the trailer is transported over a longer haul distance and is then unpacked and disaggregated at the destination. LTL is especially appropriate for the needs of small businesses that may require frequent, smaller volume shipments and are not able to economically make use of a full trailer;

● "Merger" refers to the consummation of that certain merger agreement, dated December 13, 2021, and as amended on December 29, 2021 (the "Merger Agreement") by and among Hudson Capital, Inc., Hudson Capital Merger Sub I, Inc., a Delaware corporation and wholly-owned subsidiary of Hudson Capital Inc. ("Merger Sub I"), Fr8App and ATW Master Fund II, L.P., as the representative of the stockholders of Fr8App (the "Stockholders' Representative") whereby Merger Sub I merged with and into Fr8App, with Fr8App surviving the Merger and continuing as a direct wholly-owned subsidiary of the Company. The Merger closed on February 14, 2022 and the separate corporate existence of Merger Sub I and its Certificate of Incorporation and by-laws then in effect ceased, and the organizational documents of Fr8App after the Merger is in the form as agreed by the Company and Fr8App;

● "shares," "ordinary shares" or "Ordinary Share" refers to the Company's ordinary shares with no par value per share. Unless otherwise noted, the share and per share information in this report have been adjusted to give effect to the one-for-ten (1-for-10) reverse stock split of the outstanding ordinary shares which became effective on March 24, 2023, one-for-ten (1-for-10) reverse stock split of the outstanding ordinary shares which became effective on February 24, 2024 and the one-for-twenty-five (1-for-25) reverse stock split of the outstanding common stock which became effective on September 25, 2024.

● "U.S." means the United States of America;

● "U.S. GAAP" refers to generally accepted accounting principles in the United States;

● "we," "us," "our," the "Company," "Freight Technologies, Inc.," and "our company" refer to the operations of Freight Technologies, Inc., a British Virgin Islands business company.

● "$," "dollars," "US$" or "U.S. dollars" refers to the legal currency of the United States; and

● all discrepancies in any table between the amounts identified as total amounts and the sum of the amounts listed therein are due to rounding.

**Note Regarding Trademarks, Trade Names and Service Marks**

We use various trademarks, trade names and service marks in our business. For convenience, we may not include the ℠, <sup>®</sup> or <sup>™</sup> symbols, but such omission is not meant to indicate that we would not protect our intellectual property rights to the fullest extent allowed by law. Any other trademarks, trade names or service marks referred to in this Quarterly Report on Form 10-Q are the property of their respective owners.

**Special Note Regarding Forward-Looking Statements**

This Quarterly Report on Form 10-Q contains forward-looking statements that are based on our management's beliefs and assumptions and on information currently available to us. All statements other than statements of historical facts are forward-looking statements. These statements relate to future events or to our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements include, but are not limited to, statements about:

● growth strategies;

● future business development, results of operations and financial condition;

● any statement concerning the attraction and retention of highly qualified personnel;

● our ability to attract and retain users and customers and generate revenue and profit from our customers;

● any statements concerning Fr8Tech's financial performance;

● any statements regarding expectations concerning Fr8Tech's relationships and actions with third parties; and

● future regulatory, judicial and legislative changes in Fr8Tech's industry.

In some cases, you can identify forward-looking statements by terms such as "may," "could," "will," "should," "would," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "potential," "project" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under Item 1A. "*Risk Factors*" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the Securities and Exchange Commission (the "SEC") on April 14, 2025 (the "2024 Annual Report"), and elsewhere in this Quarterly Report on Form 10-Q. If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance.

In addition, statements that "we believe" and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events or information as of the date on which the statements are made in this Quarterly Report on Form 10-Q. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

**Overview**

Focused on addressing the distinct challenges within the supply chain ecosystem, the Company's portfolio of solutions includes the Fr8App platform for seamless over-the-road ("OTR") business-to-business ("B2B") cross-border shipping across the USMCA region; Fr8Now, a specialized service for LTL shipping; Fr8Fleet, a dedicated capacity service for enterprise clients in Mexico; Waavely, a digital platform for efficient ocean freight booking and management of container shipments between North America and ports worldwide; and, Fleet Rocket a nimble, scalable and cost-effective Transportation Management System ("TMS") for brokers, Shippers, and other logistics operators. Together, each product is interconnected within a unified platform to connect Carriers and Shippers and significantly improve matching and operation efficiency via innovative technologies such as live pricing and real-time tracking, digital freight marketplace, brokerage support, transportation management, fleet management, and committed capacity solutions. More information on the Company and its service offerings is available on its corporate website, fr8technologies.com.

**Our Historical Performance**

As of June 30, 2025, the Company had an accumulated deficit of $45,869,587 and cash balance of $586,658. During the six months ended June 30, 2025 and the year ended December 31, 2024, we had a net loss of $952,808 and $5,601,227, respectively. To date, the Company has financed its operations primarily through capital raises and sales of its services. In September 2022, the Company filed the Shelf Registration Statement, which was declared effective by the SEC on September 26, 2022, for potential offerings of up to $15,000,000 in aggregate, subject to the requirement that in no event may we sell shares having a value exceeding more than one-third of our public float in any 12-month period under the Shelf Registration Statement so long as our public float remains below $75,000,000.

In May 2024, the Company entered into the ATM Sales Agreement, and filed a prospectus supplement to the Shelf Registration Statement for the ATM Financing for gross proceeds of up to $2,300,000. In June 2024, the Company filed an additional prospectus supplement to the Shelf Registration Statement to increase the maximum gross proceeds to $4,750,000.

In February 2025, the Company raised $3,000,000 from proceeds from the issuance of Series A4 preferred shares. Based on the Company's existing cash resources and the cash expected to be received from future planned financings, it is expected that the Company will have sufficient funds to carry out the Company's planned operations through December 31, 2025 and for at least 12 months beyond that period.

On May 27, 2025, $1.5 million of convertible notes issued under a $20 million facility, which was established on April 29, 2025, exclusively for the purchase of Official Trump tokens, were converted into 387,305 Series A4 preferred shares.

On August 6, 2025, the Company entered into a securities purchase agreement with an accredited wherein the Company issued an aggregate of (i) 12,540,000 series B preferred shares; and (ii) 126,005 series A4 preferred shares for a total purchase price of $500,000. The Offering raised net cash proceeds of approximately $485,000 after deducting the transfer agent and legal fees and expenses.

**Key Factors Affecting Our Financial Performance**

The demand for our platform and our related services is dependent upon overall economic conditions in North America. General economic factors, including the amount of international trade across North America may affect our Shipper clients' needs for our services. A slowdown in economic activity, an increase in unemployment, a decline in real personal income, among other economic conditions, may affect individuals' level of disposable income and the consequent effect on international trade. This may reduce Shippers' needs to transport goods and their need to use our platform.

***Trends***

Fr8Tech believes the growing interest in digital freight matching platforms shows that traditional 3PL providers recognize the sweeping technological shifts in the industry. We are offering solutions that significantly improve end-to-end freight procurement transactions to market participants. During the last five years, the industry experienced significant swings in supply, demand and costs due to distortions in both domestic and global markets resulting from the global pandemic caused by the virus known as COVID-19 and its follow-on effects. This substantial supply chain volatility led large and small freight brokers to, among other tactics, pivot toward more abundant and secure sources of freight capacity available in a digital marketplace and facilitated by software portals and platforms. Fr8Tech believes supply chain management will continue to evolve into increasingly digital forms and interactive marketplace platforms. As it does, Fr8Tech believes digital brokers, will play an increasingly integral role in easing capacity constraints, opening up new lanes, and providing a benchmarking tool for Shippers.

While the COVID-19 pandemic is behind us, Fr8Tech believes the pandemic changed the current nature of global commerce and shipping. Putting aside the recently increased import tariffs and threats of other possible restrictive trade policies of the Trump administration, the near-shoring phenomenon continues to point towards more freight crossing over the U.S. border with Mexico and a lesser extent, Canada, as manufacturers and producers seek to move operations closer to customers. Additionally, trucking capacity remains not steadily available in the Mexican domestic and across border markets. Fr8Tech believes that these conditions are creating a market opportunity for digital brokers to facilitate and improve the connections necessary to enable cross-border commerce*.*

**Results of Operations**

***Select Financial Data***

The following table presents the selected consolidated financial information for our Company. All numbers are presented in United States Dollars. The selected consolidated statements of comprehensive income data for the quarters ended June 30, 2025, and 2024, and the consolidated balance sheets data as of June 30, 2025, and December 31, 2024, have been derived from our consolidated financial statements, which are consistent with numbers reported in our prior annual filings.

Our historical results do not necessarily indicate results expected for any future periods. The selected consolidated financial data should be read in conjunction with, and are qualified in their entirety by reference to, our audited consolidated financial statements and related notes and "Item 5. Operating and Financial Review and Prospects" below. Our consolidated financial statements are prepared and presented in accordance with U.S. GAAP.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended June 30** | **Three Months Ended June 30** | **Six Months Ended June 30** | **Six Months Ended June 30** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenue** | $**2989910** | $**3837842** | $**7090550** | $**8125602** |
| **Cost and expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cost of revenue | 2534689 | 3113444 | 6127989 | 7170071 |
| &nbsp;&nbsp;&nbsp;Compensation and employee benefits | 1109141 | 1363395 | 2363930 | 2817736 |
| &nbsp;&nbsp;&nbsp;General and administrative | 663272 | 940390 | 1260025 | 1671927 |
| &nbsp;&nbsp;&nbsp;Sales and marketing | 46844 | 15525 | 62889 | 34319 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 106935 | 110039 | 210789 | 220246 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total cost and expenses** | **4460881** | **5542793** | **10025622** | 11914299 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Operating loss** | **(1470971)** | **(1704951)** | **(2935071)** | **(3788697)** |
| **Other income and expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense, net | (208245) | (231828) | (343109) | (404532) |
| &nbsp;&nbsp;&nbsp;Change in fair value of convertible note |  | 22602 |  | 22602 |
| &nbsp;&nbsp;&nbsp;Change in fair value of cryptocurrency | 2347697 | - | 2347697 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Income (loss) before provision for income taxes** | **668481** | **(1914177)** | **(930484)** | **(4170627)** |
| &nbsp;&nbsp;&nbsp;Income tax expense | 19243 | 40379 | 22324 | 40379 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net loss** | $**649238** | $**(1954556)** | $**(952808)** | $**(4211006)** |

---

**Revenues**

Fr8Tech's revenues decreased to $7,090,550 for the six months ended June 30, 2025 from $8,125,602 for the six months ended June 30, 2024, a reduction of $1,035,052 or 13% on year-over-year basis. The year-over-year decrease was primarily driven by lower dedicated capacity revenue following the Company's decision to limit credit exposure with the Company's largest Fr8Fleet customer, and a stronger US dollar relative to the Mexican peso.

**Costs of Revenue**

Fr8Tech's cost of revenue, which represents costs the Company incurs from its partner carriers to complete customer shipments, decreased to $6,127,989 for the six months ended June 30, 2025, from $7,170,071 for the six months ended June 30, 2024, a reduction of $1,042,082 and 15% on a year-over-year basis. Year-over-year cost of revenue decreased primarily due to the decline in revenue, management's continued focus on higher margin customers and routes, and a stronger US dollar relative to the Mexican peso.

**Compensation and Employee Benefits**

Fr8Tech's compensation and employee benefits expenses were $2,363,930 for the six months ended June 30, 2025 compared to $2,817,736 for the six months ended June 30, 2024, which was a $453,806 or 16% decrease on a year-over-year basis. The decrease was primarily due to lower headcount in 2025 following the elimination of approximately 20 positions across most functions in an effort to streamline operations and reduce costs.

**General and Administrative**

General and administrative expenses were $1,260,025 for the six months ended June 30, 2025 compared to $1,671,927 for the six months ended June 30, 2024, which was a decrease of $411,902 primarily due to lower spend on outside professional services and insurance, and a stronger US dollar relative to the Mexican peso.

**Sales and Marketing**

Sales and marketing expenses were $62,889 for the six months ended June 30, 2025, compared to $34,319 for the six months ended June 30, 2024, which was an increase of $28,570 or 83%. The increase in sales and marketing expenses was primarily related to promotional activities in support of the launch of Fleet Rocket.

**Depreciation and Amortization**

Depreciation and amortization expenses represent the amortization of previously capitalized software development costs, as appropriate, and depreciation expenses related to Fr8App's fixed assets. This expense decreased $9,457 to $210,789 for the six months ended June 30, 2025, from $220,246 for the six months ended June 30, 2024.

**Other income and expenses**

Interest expense for the six months ended June 30, 2025, decreased to $343,109 from $404,532 for the six months ended June 30, 2024, or by $61,423 primarily due lower borrowing against the Company's revolving credit facility.

Other income for the six months ended June 30, 2025, included net unrealized gains of $2,347,697 in the fair value of its cryptocurrency holdings.

**Liquidity and Going Concern**

Fr8Tech has historically met its cash needs through a combination of cash flows from operating activities, term loans, promissory notes, bonds, convertible notes, private placement offerings and sales of equity. Fr8Tech's cash requirements are generally for operating activities and debt repayments. Fr8Tech funded its early operations with a combination of debt and equity and we continue to work to position the Company to operate on a go-forward basis with a minimal amount of long-term debt and other borrowings. On January 3, 2023, Fr8Tech closed on a $6.6 million convertible note facility with a private investor, which was increased to $9.9 million in April 2023. The convertible note was mostly converted to equity during 2023. The balance of the convertible note of $219 thousand as of June 30, 2024, was extinguished in September 2024. The Company entered into a $750 thousand 1-year term note purchase agreement with Freight Opportunities, LLC on March 11, 2024, and an additional term note for $125 thousand with Freight Opportunities, LLC on June 4, 2024. Both promissory notes were also extinguished in September 2024.

On February 3, 2025, the Company raised $3.0 million through the issuance of Series A4 preferred shares. On May 27, 2025, $1.5 million of convertible notes issued under a $20 million facility, which was established on April 29, 2025, exclusively for the purchase of Official Trump tokens, were converted into 387,305 Series A4 preferred shares. On August 6, 2025, the Company entered into a securities purchase agreement with an accredited wherein the Company issued series B preferred and series A4 preferred shares for a total purchase price of $0.5 million.

Our combined accounts receivable and unbilled receivable balance of $6.5 million at June 30, 2025, increased by $2.4 million or 60% from $4.1 million at December 31, 2024, primarily due to lower collections compared to the prior year.

As of June 30, 2025, Fr8Tech's accounts payable, short-term borrowings and accrued expenses increased by $1,302,912 to $7,369,702 compared to December 31, 2024, due mostly to increased borrowing on the revolving credit facility. At June 30, 2025, Fr8Tech had net working capital of negative $179,851.

In March 2019, we secured a revolving line of credit that is used to assist with managing our working capital needs. The maximum principal amount that may be drawn under the line of credit was increased since then to $5 million, which remains in place. As of June 30, 2025, and December 31, 2024, the amount drawn under this facility was $4.9 million $3.3 million, respectively. We continue to incur short-term debt with this facility, which is collateralized by our accounts receivable, and we expect to maintain this debt facility to support ongoing operations.

As shown in the accompanying consolidated financial statements as of June 30, 2025, we had an accumulated deficit of approximately $45,869,587, short-term debt of $4,961,684, unrestricted cash of approximately $586,658 and a working capital of approximately negative $179,851. In addition, for the six months ended June 30, 2025, and for the year ended December 31, 2024, we reported operating losses and negative cash flows from operations.

Most of cash resources of the Company fund operating activities. Through June 30, 2025, we have financed our operations primarily with the proceeds from the sale and issuance of our ordinary and preferred shares, convertible promissory notes, promissory notes and debt.

If we are unable to raise additional capital moving forward, our ability to operate in the normal course and continue to invest in our business may be materially and adversely impacted and we may be forced to scale back operations or divest some or all of our assets.

As a result of the above, in connection with our assessment of going concern considerations in accordance with FASB Accounting Standards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern," management has determined that our liquidity condition raises substantial doubt about our ability to continue as a going concern through twelve months from the date these consolidated financial statements are available to be issued. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should we be unable to continue as a going concern.

**Cash flows**

***Comparison of the Six Months ended June 30, 2025, and June 30, 2024***

The following table summarizes our sources and uses of cash for the six Months ended June 30, 2025, and June 30, 2024.

---

| | | |
|:---|:---|:---|
| **(US$)** | **Six Months Ended**<br>**June 30, 2025** | **Six Months Ended**<br>**June 30, 2024** |
| Net cash used in operating activities | (5039217) | (4857126) |
| Net cash used in investing activities | (984831) | (173879) |
| Net cash provided by financing activities | 6407563 | 3923593 |
| Net effect of exchange rates on cash | (889) | 7883 |
| Net increase (decrease) in cash and cash equivalents | 383515 | (1107412) |

---

***Cash flows used in Operating Activities***

For the six months ended June 30, 2025, net cash used in operating activities was $5,039,217 primarily driven by a net loss of $952,808, the net change in value of cryptocurrencies of $2,427,754 and cash used for working capital of $2,417,671. The change in working capital was mainly due to increased accounts and unbilled receivables of $1,761,635 and $279,313, respectively.

For the six months ended June 30, 2024, net cash used in operating activities was $4,857,126 primarily driven by a net loss of $4,211,006 and cash used for working capital of $1,851,119. The change in working capital was mainly due to decreased accrued expenses and accounts payable of $1,138,213 and $292,155, respectively.

***Cash flows used in Investing Activities***

For the six months ended June 30, 2025, net cash used in investing activities was $984,831. Net purchases of Official Trump coin and FET token cryptocurrencies were $828,713, and $156,118 was spent on software development efforts for additional functionalities and capabilities of the Fr8App platform and related offerings, as well as ongoing development of Fleet Rocket.

For the six months ended June 30, 2024, net cash used in investing activities was $173,879, mostly for software development efforts for additional functionalities and capabilities of the Fr8App platform and related offerings.

***Cash flows provided by Financing Activities***

For the six months ended June 30, 2025, net cash provided by financing activities was $6,407,563 attributable to proceeds from the issuance of Series A4 shares and proceeds from short-term borrowings.

For the six months ended June 30, 2024, net cash provided by financing activities was $3,923,593 primarily attributable to proceeds from equity sales of $1,453,589, a net drawdown of $1,697,468 from short-term borrowings, and from the issuance of a $873,000 promissory note.

---

| | |
|:---|:---|
| **ITEM 3.** | **QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.** |

---

Not applicable.

---

| | |
|:---|:---|
| **ITEM 4.** | **CONTROLS AND PROCEDURES.** |

---

**Evaluation of Disclosure Controls and Procedures**

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, have evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) prior to the filing of this Quarterly Report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.

**Changes in Internal Control over Financial Reporting**

There were no changes in our internal control over financial reporting during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II**

---

| | |
|:---|:---|
| **ITEM 1.** | **LEGAL PROCEEDINGS** |

---

During the six months ended June 30, 2025, there were no material pending legal proceedings or material developments in pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the Company is a party or of which any of their property is the subject.

---

| | |
|:---|:---|
| **ITEM 1.A.** | **RISK FACTORS** |

---

There are no material changes from the risk factors previously disclosed in Item 1A "Risk Factors" of the 2024 Annual Report.

---

| | |
|:---|:---|
| **ITEM 2.** | **UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.** |

---

 ****

***Unregistered Sales of Equity Securities***

During the six months ended June 30, 2025, we did not sell any equity securities that were not registered under the Securities Act and that were not previously disclosed in a Current Report on Form 8-K.

***Purchases of Equity Securities***

Other than as previously disclosed in Current Reports on Form 8-K, no repurchases of our ordinary shares were made during the six months ended June 30, 2025.

---

| | |
|:---|:---|
| **ITEM 3.** | **DEFAULTS UPON SENIOR SECURITIES.** |

---

None.

---

| | |
|:---|:---|
| **ITEM 4.** | **MINE SAFETY DISCLOSURES.** |

---

Not applicable.

---

| | |
|:---|:---|
| **ITEM 5.** | **OTHER INFORMATION.** |

---

No information was required to be disclosed in a Current Report on Form 8-K during the six months ended June 30, 2025 but was not reported.

None of our directors or "officers," as defined in Rule 16a-1(f) under the Exchange Act, adopted or terminated a Rule 10b5-1 trading plan or arrangement or a non-Rule 10b5-1 trading plan or arrangement, as defined in Item 408(c) of Regulation S-K, during the fiscal quarter ended June 30, 2025.

---

| | |
|:---|:---|
| **ITEM 6.** | **EXHIBITS.** |

---

---

| | |
|:---|:---|
| **Exhibit**<br>**Number** | **Description** |
| 3.1 | [Amended and Restated Memorandum and Articles of Association dated as of June 27, 2025 (incorporated by reference to Exhibit 3.1 to the Form 8-K filed on June 30, 2025)](https://www.sec.gov/Archives/edgar/data/1687542/000164117225017013/ex3-1.htm) |
| 10.1 | [Securities Purchase Agreement dated April 29, 2025 by and between Freight Technologies, Inc. and the Buyers (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on April 30, 2025).](https://www.sec.gov/Archives/edgar/data/1687542/000164117225007246/ex10-1.htm) |
| 10.2 | [Security Agreement, dated as of May 2, 2025, by and between Freight Technologies, Inc., and Collateral Agent (incorporated by reference to Exhibit 10.2 to the Form 8-K filed on May 9, 2025).](https://www.sec.gov/Archives/edgar/data/1687542/000164117225009373/ex10-2.htm) |
| 10.3 | [Amendment and Exchange Agreement dated May 27, 2025, by and between Freight Technologies, Inc. and the Holder (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on May 28, 2025).](https://www.sec.gov/Archives/edgar/data/1687542/000164117225012557/ex10-1.htm) |
| 10.4 | [Waiver and Amendment of Certain Restrictions in Securities Purchase Agreement dated June 26, 2025, by and between Freight Technologies, Inc. and Fetch Compute, Inc (incorporated by reference to Exhibit 10.1 to the Form 8-K filed on July 2, 2025).](https://www.sec.gov/Archives/edgar/data/1687542/000164117225017413/ex10-1.htm) |
| 31.1\* | [Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ex31-1.htm) |
| 31.2\* | [Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ex31-2.htm) |
| 32.1\*\* | [Certification by Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](ex32-1.htm) |
| 32.2\*\* | [Certification by Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](ex32-2.htm) |
| 101.INS\* | Inline XBRL Instance Document |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104\* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |

---

\* Filed herewith <br> \*\* Furnished herewith

**SIGNATURES**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
| Date: August 18, 2025 | **FREIGHT TECHNOLOGIES, INC.** | **FREIGHT TECHNOLOGIES, INC.** |
|  |  | */s/ Javier Selgas* |
|  | Name: | Javier Selgas |
|  | Title: | Chief Executive Officer |
|  | | *(Principal Executive Officer)* |
|  |  | */s/ Donald Quinby* |
|  | Name: | Donald Quinby |
|  | Title: | Chief Financial Officer |
|  |  | *(Principal Financial and Accounting Officer)* |

---

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATIONS**

I, Javier Selgas, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;1. I
 have reviewed this Quarterly Report on Form 10-Q of Freight Technologies, Inc.;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
 (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
 Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

c) Evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
 or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;5. The
 registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over
 financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or
 persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

Date: August 18, 2025

---

| |
|:---|
| */s/ Javier Selgas* |
| Javier Selgas |
| Chief Executive Officer<br>|
| *(Principal Executive Officer)* |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATIONS**

I, Donald Quinby, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;1. I
 have reviewed this Quarterly Report on Form 10-Q of Freight Technologies, Inc.;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
 (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
 Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

c) Evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
 or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;5. The
 registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over
 financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or
 persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

Date: August 18, 2025

---

| |
|:---|
| */s/ Donald Quinby* |
| Donald Quinby |
| Chief Financial Officer<br>|
| *(Principal Financial Officer and Principal Accounting Officer)* |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906<br> OF THE SARBANES-OXLEY ACT OF 2002**

The undersigned Chief Executive Officer of Freight Technologies, Inc. (the "Company"), DOES HEREBY CERTIFY that to my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The
 Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 (the "Report"), fully complies with
 the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. Information
 contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

IN WITNESS WHEREOF, the undersigned has executed this statement on August 18, 2025.

---

| |
|:---|
| */s/ Javier Selgas* |
| Javier Selgas |
| Chief Executive Officer<br>|
| *(Principal Executive Officer)* |

---

A signed original of this written statement required by Section 906 has been provided to Freight Technologies, Inc. and will be retained by Freight Technologies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

The forgoing certification is being furnished to the Securities and Exchange Commission pursuant to 18 U.S.C. Section 1350. It is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906<br> OF THE SARBANES-OXLEY ACT OF 2002**

The undersigned Chief Financial Officer of Freight Technologies, Inc.(the "Company"), DOES HEREBY CERTIFY that to my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The
 Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 (the "Report"), fully complies with
 the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. Information
 contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

IN WITNESS WHEREOF, the undersigned has executed this statement on August 18, 2025.

---

| |
|:---|
| */s/ Donald Quinby* |
| Donald Quinby |
| Chief Financial Officer<br>|
| *(Principal Financial Officer and Principal Accounting Officer)* |

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A signed original of this written statement required by Section 906 has been provided to Freight Technologies, Inc. and will be retained by Freight Technologies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

The forgoing certification is being furnished to the Securities and Exchange Commission pursuant to 18 U.S.C. Section 1350. It is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.