Executive Summary / Key Takeaways

• Concrete Leveling Systems, Inc. (CLEV) stands at a critical juncture, attempting a transformative pivot from its declining concrete leveling equipment business to a high-potential, albeit speculative, gaming and hospitality venture through the contingent acquisition of Jericho Associates, Inc.
• The company's traditional concrete leveling division faces headwinds, with revenues decreasing to $703 in the fiscal year ended July 31, 2025, contributing to a net loss of $61,390 for the period.
• CLEV's future hinges on the finalization of the Jericho acquisition, which involves a contemplated "over $300 million project" for a casino and hotel resort, promising entry into tribal and commercial casino gaming and technology, backed by experienced leadership.
• Significant financial and operational risks persist, including a "going concern" warning from auditors, insufficient cash to meet operating requirements beyond November 30, 2025, and identified material weaknesses in internal controls.
• Investors are presented with a speculative opportunity, balancing the potential for substantial upside from a successful gaming pivot against considerable financial uncertainties and the contingent nature of the strategic shift.

A Dual Identity in Flux: Setting the Scene for CLEV's Transformation

Concrete Leveling Systems, Inc. (CLEV), incorporated in Nevada in 2007, has historically operated as a manufacturer and marketer of specialized equipment for the concrete leveling industry, doing business in Ohio under the trade name CLS Fabricating, Inc. The company's core product is a truck-mounted service unit designed to mix lime with water and pump the mixture under pressure into pre-drilled holes to raise flat concrete surfaces. This proprietary equipment emphasizes ease of use and efficiency, offering a straightforward mechanical solution for various leveling needs. While specific quantitative performance metrics for this technology are not publicly detailed, its design aims to provide reliable performance and operational simplicity for end-users.

However, CLEV is currently poised for a dramatic strategic shift, contingent on the finalization of an Equity Purchase Agreement to acquire Jericho Associates, Inc., a company focused on the gaming, hospitality, and entertainment industries. This potential acquisition, initiated in 2017, would fundamentally transform CLEV into a dual-division entity, adding a high-growth, high-stakes gaming and hospitality segment to its existing, albeit struggling, concrete leveling operations. This strategic pivot represents a significant gamble, aiming to leverage new market opportunities to overcome persistent financial challenges.

The Concrete Leveling Foundation: Steady but Stagnant

CLEV's traditional concrete leveling division has faced declining demand in recent periods. For the fiscal year ended July 31, 2025, revenues from equipment and parts sales decreased to $703, down from $778 in the prior fiscal year. This 9.64% decline was primarily attributed by management to decreased sales of concrete leveling parts due to a reduction in demand. Despite a slight decrease in the cost of sales from $229 in 2024 to $219 in 2025, the gross margin also saw a reduction, falling from $549 to $484 over the same period.

Operating expenses, primarily consisting of legal and professional fees and selling, general, and administrative expenses, increased to $51,597 in fiscal year 2025 from $49,349 in fiscal year 2024. This increase was largely driven by higher accounting fees. As a result of these factors, the company reported a net loss of $61,390 for the year ended July 31, 2025, following a net loss of $65,985 in the previous fiscal year. These financial trends underscore the challenges facing CLEV's legacy business and highlight the urgency of its strategic reorientation.

The Jericho Gamble: High Stakes in Gaming & Hospitality

The most significant driver of CLEV's future outlook is the contingent acquisition of Jericho Associates, Inc. This transaction, if finalized, would introduce a new gaming and hospitality division focused on casino gaming, hospitality, entertainment, and leisure time industries. The strategy involves pursuing opportunities in tribal and commercial casino gaming in California and Nevada, as well as seeking partnerships, joint ventures, or acquisitions of companies developing innovative casino games that combine traditional casino mechanics with video game challenges and social playability.

The acquisition is tied to a contemplated "over $300 million project" to develop a casino and hotel resort, with Jericho having identified a 50% interest in two LLCs for this purpose. The shares issued to Jericho's shareholders remain contingent upon regulatory review, finalization of closing documents, and completion of financing for this substantial project. Ronald J. Tassinari, the current CEO of Jericho and slated to become a director and CEO of CLEV upon merger closing, brings over thirty years of experience in the gaming and hospitality industry. His track record includes developing and managing the Table Mountain Casino, which grew into a major casino destination with gross revenues exceeding $300 million, and providing extensive casino consulting services. Mr. Tassinari is actively conducting due diligence on tribal and commercial gaming projects and seeking new gaming technology innovations. Management believes that the addition of this gaming and hospitality business will lead to increased revenue over the 2026 fiscal year.

Financial Health and Liquidity: A Going Concern Challenge

CLEV's financial position presents significant challenges. As of July 31, 2025, the company reported cash and cash equivalents of $824, a decrease from $887 in the prior year. Total assets stood at $19,479, while total liabilities were $641,128, resulting in a stockholders' deficit of $621,649. The company's auditors issued an opinion raising "substantial doubt about the ability to continue as a going concern due to its current financial position."

Net cash used in operating activities for the year ended July 31, 2025, was $63, a shift from net cash provided by operating activities of $205 in the prior year, primarily due to increased net losses. Management explicitly stated that "with our existing cash flows, we do not have sufficient cash to meet our operating requirements for the next twelve months." The company relies heavily on advances from Jericho, which totaled approximately $360,179 as of July 31, 2025, to fund operating expenses during the merger approval process. These non-interest-bearing advances are expected to be repaid upon the consummation of the merger. Management projects that, based on its current cash position and planned expense run rate, it has funds to finance operations only through November 30, 2025. This precarious liquidity position underscores the critical need for the Jericho acquisition to finalize or for alternative financing to be secured.

Operational Insights and Governance

Operationally, CLEV is a lean organization, reporting zero full-time and zero part-time employees as of July 31, 2025. The company's principal office space is provided rent-free by its President, Edward A. Barth. This minimal operational footprint reflects its current state and reliance on related parties.

Furthermore, management concluded that its disclosure controls and procedures and internal control over financial reporting were "not effective as of July 31, 2025." Material weaknesses identified include "inadequate segregation of duties consistent with control objectives; lack of a code of ethics; lack of a whistleblower policy; lack of an independent board of directors or board committees related to financial reporting; and lack of multiple levels of supervision and review." While management believes these weaknesses have not materially affected financial results, they plan to implement remediation changes in the 2026 fiscal year, including appointing additional qualified personnel and establishing a more robust governance framework.

Competitive Arena: Niche Player in a Diverse Landscape

In the concrete leveling industry, CLEV operates as a manufacturer of specialized equipment, positioning itself against competitors like PolyLevel, Uretek, and Avanti International. PolyLevel is known for its polyurethane foam injection systems, focusing on service delivery and installation, with a strong reputation for reliable, long-lasting solutions. Uretek specializes in geopolymer injection technologies for commercial and industrial applications, emphasizing environmentally friendly solutions and advanced material science. Avanti International provides chemical grouts and injection systems, with a focus on waterproofing and structural stabilization.

CLEV's competitive advantages in its concrete leveling division include its proprietary equipment designs, which aim for ease of operation and reduced downtime for users. This could translate to stronger customer loyalty and potentially superior margins through efficient production. Its cost leadership in manufacturing and established distribution channels also serve as competitive moats, helping to defend against new entrants. However, CLEV faces vulnerabilities due to its smaller scale operations, which may limit resource allocation for R&D, and potential technological gaps compared to competitors' advanced materials or integrated service offerings. For instance, PolyLevel's service dominance and Uretek's advanced geopolymer technology present challenges that CLEV's equipment-focused model may struggle to match in terms of innovation speed or specialized capabilities.

Should the Jericho acquisition finalize, CLEV would enter the highly competitive casino gaming and hospitality industry. This new division would leverage Ronald Tassinari's extensive experience in developing and managing major casino destinations and his active pursuit of new gaming technology. This strategic entry aims to differentiate CLEV by combining traditional casino games with video game challenges and social playability, potentially carving out a niche in a market dominated by established players. The ability to partner with third parties in the casino and hospitality industries could also allow for the further development and utilization of CLEV's concrete leveling division if agreements result in new construction.

Outlook and Risks: A Path Fraught with Contingencies

The outlook for CLEV is bifurcated, heavily dependent on the successful finalization of the Jericho acquisition. Management anticipates that the "addition of our gaming and hospitality business" will "begin to generate increased revenue over the 2026 fiscal year." This projection, however, is predicated on the resolution of significant contingencies, including regulatory review, finalization of closing documents, and securing financing for the "over $300 million project."

The risks are substantial. The "going concern" warning from auditors is a critical red flag, indicating that without significant new revenue or financing, the company's ability to continue operations is in doubt. The classification of CLEV's shares as "penny stock" further complicates matters, as it "makes it more difficult for a broker-dealer to sell the stock into a secondary market," potentially hindering liquidity for investors. The identified material weaknesses in internal controls, while management believes they haven't materially affected financial results, represent a governance risk that needs effective remediation. The failure to secure additional funds or finalize the Jericho transaction could have a "material, adverse effect on the business, financial condition and results of operations," potentially leading the company to cease operations.

Conclusion

Concrete Leveling Systems, Inc. presents a compelling, albeit highly speculative, investment narrative centered on a proposed transformation from a niche concrete leveling equipment manufacturer to a diversified entity with a significant footprint in the gaming and hospitality sector. The company's current concrete leveling operations are experiencing declining demand and contributing to ongoing losses, underscoring the necessity of its strategic pivot. The potential acquisition of Jericho Associates, Inc. offers a clear path to substantial revenue growth and market diversification, backed by experienced leadership in the gaming industry and a vision for innovative gaming technology.

However, the path forward is fraught with considerable risk. The contingent nature of the Jericho acquisition, coupled with CLEV's precarious financial health, including a "going concern" warning and limited liquidity, demands careful consideration from investors. The success of this high-stakes gamble hinges entirely on the timely and successful completion of the gaming venture. For investors with a high tolerance for risk and a belief in the transformative potential of the Jericho acquisition, CLEV represents a unique, albeit speculative, opportunity to participate in a company attempting to redefine its future. The ability to execute on the gaming strategy and address its significant financial and operational challenges will be paramount in determining CLEV's long-term viability and investment appeal.