| CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY |
NOTE 28 — CONDENSED FINANCIAL INFORMATION OF THE
PARENT COMPANY
We have performed a test
on the restricted net assets of our subsidiaries in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08(e)(3) and
determined the aggregate restricted net assets of our subsidiaries exceed 25% of our consolidated net assets as of December 31,
2024 and 2023. The following condensed financial information as of and for the years ended December 31, 2024 and 2023 represents
the financial information of Webull Corporation, the ultimate parent of consolidated subsidiaries, and has been prepared in accordance
with SEC Regulation S-X Rule 5-04 and Rule 12-04.
Condensed Statement of Financial Position:
| | |
2024 | | |
2023 | |
| Assets | |
| | |
| |
| Cash and cash equivalents | |
$ | 25,975,604 | | |
$ | 5,777,326 | |
| Prepaid expenses and other current assets | |
| 7,739,569 | | |
| 5,219,813 | |
| Advances to subsidiaries | |
| 390,811,557 | | |
| 334,853,972 | |
| Note receivable from subsidiary | |
| 42,100,000 | | |
| 42,100,000 | |
| Investment in subsidiaries | |
| 353,629,225 | | |
| 324,524,687 | |
| Total assets | |
$ | 820,255,955 | | |
$ | 712,475,798 | |
| | |
| | | |
| | |
| Liabilities | |
| | | |
| | |
| Accounts payable and other accrued expenses | |
$ | 5,950,394 | | |
$ | 7,324,865 | |
| Advances from subsidiaries | |
| 59,500,001 | | |
| 20,000,000 | |
| Total liabilities | |
| 65,450,395 | | |
| 27,324,865 | |
| | |
| | | |
| | |
| Mezzanine equity | |
| | | |
| | |
| Convertible redeemable preferred shares (aggregate liquidation preference of $644,132,365 and $604,496,457 as of December 31, 2024 and 2023, respectively; and aggregate redemption value of $2,861,748,733 and $2,326,363,413 as of December 31, 2024 and 2023, respectively; Note 15) | |
| 2,861,748,733 | | |
| 2,326,363,413 | |
| Total mezzanine equity | |
| 2,861,748,733 | | |
| 2,326,363,413 | |
| | |
| | | |
| | |
| Shareholders’ deficit | |
| (2,106,943,173 | ) | |
| (1,641,212,480 | ) |
| Total liabilities, mezzanine equity
and shareholders’ deficit | |
$ | 820,255,955 | | |
$ | 712,475,798 | |
Condensed Statement of Operations and Comprehensive Loss:
| | |
2024 | | |
2023 | | |
2022 | |
| Revenues | |
$ | – | | |
$ | – | | |
$ | – | |
| Operating expenses | |
| 7,001,102 | | |
| 3,194,193 | | |
| 8,408,161 | |
| Other income, net | |
| 3,770,837 | | |
| 2,663,713 | | |
| 1,105,532 | |
| Income before income taxes | |
| (3,230,265 | ) | |
| (530,480 | ) | |
| (7,302,629 | ) |
| Provision for income taxes | |
| – | | |
| – | | |
| – | |
| Net loss | |
| (3,230,265 | ) | |
| (530,480 | ) | |
| (7,302,629 | ) |
| Preferred shares redemption value accretion | |
| (495,088,038 | ) | |
| (340,080,000 | ) | |
| (51,409,749 | ) |
| Net loss attributable to ordinary
shareholders | |
$ | (498,318,303 | ) | |
$ | (340,610,480 | ) | |
$ | (58,712,378 | ) |
| | |
| | | |
| | | |
| | |
| Net loss | |
$ | (3,230,265 | ) | |
$ | (530,480 | ) | |
$ | (7,302,629 | ) |
| Other comprehensive income, net
of tax | |
| – | | |
| – | | |
| – | |
| Total comprehensive loss attributable to ordinary shareholders | |
| (3,230,265 | ) | |
| (530,480 | ) | |
| (7,302,629 | ) |
| Preferred shares redemption value accretion | |
| (495,088,038 | ) | |
| (340,080,000 | ) | |
| (51,409,749 | ) |
| Total comprehensive loss attributable
to ordinary shareholders | |
$ | (498,318,303 | ) | |
$ | (340,610,480 | ) | |
$ | (58,712,378 | ) |
Condensed Statement of Cash Flows:
| | |
2024 | | |
2023 | | |
2022 | |
| Cash flows from operating activities: | |
| | |
| | |
| |
| Net loss | |
$ | (3,230,265 | ) | |
$ | (530,480 | ) | |
$ | (7,302,629 | ) |
| Adjustments
to reconcile net loss to net cash used in operating activities: | |
| | | |
| | | |
| | |
| Share-based compensation | |
| 3,483,072 | | |
| 437,004 | | |
| 4,423,070 | |
| Changes in operating assets and liabilities: | |
| | | |
| | | |
| | |
| Prepaid expenses and other assets | |
| (2,519,756 | ) | |
| (3,706,010 | ) | |
| (189,272 | ) |
| Advances to/from subsidiaries | |
| (16,457,584 | ) | |
| (100,275,599 | ) | |
| (40,177,171 | ) |
| Accrued expenses
and other liabilities | |
| (1,423,462 | ) | |
| 3,411,470 | | |
| 624,363 | |
| Net cash used in operating activities | |
| (20,147,995 | ) | |
| (100,663,615 | ) | |
| (42,621,639 | ) |
| | |
| | | |
| | | |
| | |
| Cash flows from investing activities: | |
| | | |
| | | |
| | |
| Note receivable
due from subsidiary | |
| – | | |
| (12,100,000 | ) | |
| (30,000,000 | ) |
| Net cash used in investing activities | |
| – | | |
| (12,100,000 | ) | |
| (30,000,000 | ) |
| | |
| | | |
| | | |
| | |
| Cash flows from financing activities: | |
| | | |
| | | |
| | |
| Receipt of preferred stock sale proceeds | |
| 40,297,282 | | |
| 20,000,000 | | |
| – | |
| Spin-off of subsidiary to shareholders | |
| – | | |
| (7,014,594 | ) | |
| – | |
| Proceeds from exercise of options | |
| 48,991 | | |
| – | | |
| – | |
| Receipt of preferred stock subscription
receivable | |
| – | | |
| – | | |
| 73,723,814 | |
| Receipt of preferred stock warrant
exercise proceeds | |
| – | | |
| – | | |
| 10,000,000 | |
| Payment of
preferred shares repurchase payable | |
| – | | |
| – | | |
| (55,000,005 | ) |
| Net cash provided by financing activities | |
| 40,346,273 | | |
| 12,985,406 | | |
| 28,723,809 | |
| | |
| | | |
| | | |
| | |
| Net increase (decrease) in cash and cash equivalents | |
| 20,198,278 | | |
| (99,778,209 | ) | |
| (43,897,830 | ) |
| Cash and cash equivalents at beginning
of year | |
| 5,777,326 | | |
| 105,555,535 | | |
| 149,453,365 | |
| Cash and cash equivalents at end
of year | |
$ | 25,975,604 | | |
$ | 5,777,326 | | |
$ | 105,555,535 | |
| | |
| | | |
| | | |
| | |
| Supplemental cash flow information: | |
| | | |
| | | |
| | |
| Cash paid for interest and taxes | |
$ | – | | |
$ | – | | |
$ | – | |
| | |
| | | |
| | | |
| | |
| Non cash investing and financing activities: | |
| | | |
| | | |
| | |
| Note receivable from Webull Pay,
Inc. | |
$ | – | | |
$ | 2,852,106 | | |
$ | – | |
| Preferred shares redemption value accretion | |
$ | 495,088,038 | | |
$ | 340,080,000 | | |
$ | 51,409,749 | |
|