What changed in this filing

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Item 1. Financial Statements

2026-08-14 compared with 2026-05-14 · 665 added, 540 removed, 1464 unchanged (45% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

June 30, 2026

December 31, 2025

Current Assets:

Cash and Cash

Cash and Cash Equivalents

Restricted Cash

1 unchanged sentence

Other Receivables, Net

Note Receivables - Related

Convertible Loan Receivables

- Related Party

Note Receivables - Related Parties, Net

Convertible Loan Receivables - Related Party

Prepaid Expense

Investment in Securities

at Fair Value

Investment in Securities at Fair Value

Total Current Assets

Real Estate - Rental Properties,

Property and Equipment,

Operating Lease Right-Of-Use

Convertible Loan Receivables

- Related Party

Investment in Securities

at Fair Value - Related Party

Investment in Securities

in Equity Method Securities

Real Estate - Rental Properties, Net

Property and Equipment, Net

Operating Lease Right-Of-Use Assets, Net

Other Receivables, Net

Convertible Loan Receivables - Related Party

Investment in Securities at Fair Value - Related Party

Investment in Securities at Cost

Investment in Equity Method Securities

$ 124,940,908

2 unchanged sentences

Current Liabilities:

Accounts Payable and Accrued

Accounts Payable and Accrued Expenses

Operating Lease Liabilities

Notes Payable

Payable - Related Parties

Notes Payable - Related Parties

Notes Payable

Total Current Liabilities

1 unchanged sentence

Operating Lease Liabilities

Notes Payable

Total Liabilities

1 unchanged sentence

Stockholders’ Equity:

Preferred Stock, $ 0.001

Preferred Stock, $ 0.001 par value;

25,000,000 shares authorized, none issued and outstanding

1 unchanged sentence

250,000,000 shares authorized;

shares issued on March 31, 2026 and December 31, 2025;

39,401,786 shares issued on June 30, 2026 and December

38,895,830 shares

outstanding on March 31, 2026 and December 31, 2025

outstanding on June 30, 2026 and December 31, 2025

Common Stock, $0.001 par value;

250,000,000 shares authorized;

39,401,786 and 9,235,119

shares issued on March 31, 2026 and December 31, 2025, respectively;

38,895,830 and 9,235,119 shares outstanding on March 31, 2026

and December 31, 2025, respectively

39,401,786 and 9,235,119 shares issued on June 30, 2026 and December 31, 2025, respectively;

38,895,830 and 9,235,119 shares outstanding on June 30, 2026 and December 31, 2025, respectively

Additional Paid in Capital

Treasury Stock at Cost ( 505,956 shares on

March 31, 2026 and December 31, 2025)

Treasury Stock at Cost ( 505,956 shares on June 30, 2026 and December 31, 2025)

( 1,004,875 )

3 unchanged sentences

( 299,266,482 )

Other Comprehensive Income (Loss)

Accumulated Other Comprehensive (Loss) Income

Total Alset Inc.

Stockholders’

Non-controlling

Stockholders’ Equity

Liabilities and Stockholders’ Equity

Non-controlling Interests

Total Stockholders’ Equity

Total Liabilities and Stockholders’ Equity

$ 124,940,908

3 unchanged sentences

Consolidated Statements of Operations and Other Comprehensive Loss

Ended March 31,

Three- Months Ended June 30,

Six-Months Ended June 30,

Total Revenue

6 unchanged sentences

( 2,755,461 )

( 4,445,815 )

( 6,687,579 )

Other (Expense) Income

Interest Income

Interest Income - Related

Interest Income - Related Party

Interest Income

Interest Expense

Foreign Exchange Transaction

Gain on Disposal of a Subsidiary

Foreign Exchange Transaction Gain (Loss)

( 4,834,398 )

Unrealized (Loss) Gain

on Securities Investment

( 6,243,500 )

Unrealized Loss on Securities

Investment - Related Party

Unrealized Loss on Securities Investment

( 2,345,853 )

Unrealized Loss on Securities

( 4,168,896 )

Realized Loss on Securities

Unrealized (Loss) Gain on Securities Investment - Related Party

( 2,486,135 )

( 3,234,736 )

( 1,013,093 )

Unrealized (Loss) Gain on Securities Investment

( 2,486,135 )

( 3,234,736 )

( 1,013,093 )

Realized Gain (Loss) on Securities Investment

Realized Loss on Securities Investment - Related Party

( 2,438,848 )

Realized Gain (Loss) on Securities Investment

( 2,438,848 )

Loss on Equity Method Investment

Other Expense, Net

( 1,310,915 )

Other Income (Expense), Net

Total Other Expense, Net

( 4,027,566 )

( 6,085,681 )

( 6,630,409 )

( 11,615,507 )

Net Loss Before Income Taxes

1 unchanged sentence

( 8,841,142 )

( 11,076,224 )

( 18,303,086 )

Income Tax Expense

1 unchanged sentence

( 8,841,142 )

Net Loss Attributable

to Non-Controlling Interest

( 11,100,269 )

Net Loss Attributable

to Common Stockholders

( 18,346,034 )

Net Loss Attributable to Non-Controlling Interest

( 1,305,844 )

( 1,791,116 )

Net Loss Attributable to Common Stockholders

$ ( 5,272,443 )

Other Comprehensive Gain (Loss)

Currency Translation Adjustment

Total Comprehensive

$ ( 8,221,441 )

$ ( 9,794,425 )

Comprehensive Loss Attributable to Non-controlling Interests

Total Comprehensive

Loss Attributable to Common Shareholders

$ ( 16,554,918 )

$ ( 5,844,986 )

$ ( 8,841,142 )

$ ( 11,100,269 )

$ ( 18,346,034 )

Other Comprehensive (Loss) Income

Foreign Currency Translation Adjustment

Total Comprehensive Loss

( 6,589,433 )

( 4,263,680 )

( 11,597,613 )

( 12,351,162 )

Less Comprehensive (Loss) Income Attributable to Non-controlling Interests

( 1,376,666 )

Total Comprehensive Loss Attributable to Common Shareholders

( 5,910,880 )

( 4,297,932 )

( 10,220,947 )

( 11,415,838 )

Net Loss Per Share - Basic and Diluted

Weighted Average Common

Shares Outstanding - Basic and Diluted

Weighted Average Common Shares Outstanding - Basic and Diluted

accompanying notes to condensed consolidated financial statements.

3 unchanged sentences

Stock at Cost

Comprehensive Income

Alset Stockholders’ Equity

Non-Controlling

Stockholders’ Equity

Three Months Ended March 31, 2026

Comprehensive

Stockholders’

Paid in Capital

Stock at Cost

Comprehensive Income

Alset Stockholders’ Equity

Non-Controlling

Stockholders’ Equity

Comprehensive

Stockholders’

Balance at December 31, 2025

14 unchanged sentences

( 303,788,464 )

Paid in Capital

Comprehensive Income

Alset Stockholders’ Equity

Non-Controlling

Stockholders’ Equity

Three Months Ended March 31, 2025

Paid in Capital

Comprehensive Income

Alset Stockholders’ Equity

Non-Controlling

Stockholders’ Equity

Balance at January 1, 2025

Gain from DSS Convertible Note and Warrants

Change in Non-Controlling Interest

Foreign Currency Translations

( 5,272,443 )

1 unchanged sentence

( 5,844,986 )

Balance at June 30, 2026

( 1,004,875 )

( 309,060,907 )

Paid in Capital

Comprehensive

Stockholders’

Controlling Interests

Stockholders’ Equity

Balance at January 1, 2025

( 251,851,540

Issuance of Common Stock

Issuance of HWH Common Stock & Warrants

Issuance of HWH Common Stock & Warrants exercise

Gain from SHRG Warrants

2 unchanged sentences

Foreign Currency Translations

( 8,333,477 )

( 1,171,415 )

( 9,504,892 )

Balance at March 31, 2025

( 260,185,017

$ ( 260,185,017 )

$ 336,322,511

Issuance of Common Stock

Treasury Stock Buyback

Reclassification of Gain from SHRG Warrants

Foreign Currency Translations

Balance at June 30, 2025

( 268,406,458

2 unchanged sentences

Consolidated Statements of Cash Flows

Three Months Ended March 31,

Six Months Ended June 30,

Cash Flows from Operating Activities

Net Loss from

Net Loss from Operations

$ ( 11,100,269 )

$ ( 18,346,034 )

Adjustments to Reconcile

Net Loss to Net Cash Used in Operating Activities:

Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:

Non-Cash Lease Expenses

Foreign Transaction (Gain)

Unrealized Loss (Gain)

on Securities Investment

Unrealized Loss on Securities

Investment - Related Party

Realized Loss on Securities

Gain from Debt Extinguishment

Gain on Disposal of Subsidiary

Gain on Sale of Stock of Subsidiary

Foreign Transaction (Gain) Loss

Stock Based Compensation

Unrealized Loss on Securities Investment

Unrealized Loss on Securities Investment - Related Party

Realized Loss on Securities Investment

Realized Loss on Securities Investment-Related Party

Loss on Equity Method Investment

Changes in Operating Assets

and Liabilities, net of acquisitions

Real Estate Reimbursement

Changes in Operating Assets and Liabilities, net of acquisitions

Real Estate Reimbursement Receivable

Account Receivables

Other Receivable - Related

Prepaid Expense

Trading Securities

Accounts Payable and Accrued

( 2,707,420 )

( 1,993,298 )

Accounts Payable and Accrued Expenses

( 3,212,690 )

( 1,004,311 )

Deferred Revenue

Lease Liabilities

Cash Used in Operating Activities

Operating Lease Liabilities

Net Cash Used in Operating Activities

( 9,171,536 )

2 unchanged sentences

Purchase of Fixed Assets

Purchase of Investment

Proceeds from Sale of Equity

Security Investment of a Related Party

Issuing Loan Receivable

- Related Party

Purchase of Investment Securities

Proceeds from Sale of Equity Security Investment of a Related Party

Issuing Loan Receivable - Related Party

( 4,532,533 )

of Loan Receivable - Related Party

Cash Used in Investing Activities

Collection of Loan Receivable - Related Party

Net Cash (Used in) Provided by Investing Activities

( 3,705,460 )

Cash Flows from Financing Activities

Proceeds from Common Stock

Borrowing from a Commercial

to Notes Payable

Cash (Used in) Provided by Financing Activities

Net Decrease in Cash and Cash Equivalents and

Restricted Cash

Proceeds from Common Stock Issuance

Buyback Treasury Stock

Borrowing from a Commercial Loan

Repayment to Notes Payable

Net Cash (Used in) Provided by Financing Activities

Net Decrease in Cash and Cash Equivalents and Restricted Cash

( 13,385,413 )

( 2,372,656 )

Effects of Foreign Exchange Rates on Cash and

Cash Equivalents

Cash and Cash Equivalents

and Restricted Cash - Beginning of Period

Cash and Cash Equivalents

and Restricted Cash- End of Period

Cash and Restricted Cash

Effects of Foreign Exchange Rates on Cash and Cash Equivalents

Cash and Cash Equivalents and Restricted Cash - Beginning of Period

Cash and Cash Equivalents and Restricted Cash- End of Period

Restricted Cash

Total Cash and Restricted Cash

Supplementary Cash Flow Information

Paid for Interest

Paid for Taxes

Supplemental Disclosure of Non-Cash Investing

and Financing Activities

Recognition of ROU / Lease Liability

from DSS Warrants and Convertible Notes

Cash Paid for Interest

Cash Paid for Taxes

Supplemental Disclosure of Non-Cash Investing and Financing Activities

Initial Recognition of ROU / Lease Liability

Gain from DSS Warrants and Convertible Notes

accompanying notes to condensed consolidated financial statements.

3 unchanged sentences

of Operations

(the “Company” or “AEI”), was incorporated in the State of Delaware on March 7, 2018.

(the “Company” or “AEI”), was originally incorporated in the State of Delaware on March 7, 2018 and subsequently reincorporated in the State

of Texas in October 2022.

AEI is a diversified

9 unchanged sentences

has incurred recurring losses from operations.

As of and for the three months ended March 31, 2026, the Company had an accumulated deficit

of $ 303,788,464 and a loss from operations of $ 5,255,283 .

As of and for the six months ended June 30, 2026, the Company had an accumulated deficit

of $ 309,060,907 and a net loss of $ 11,100,269 .

These conditions initially raised substantial doubt about the Company’s

2 unchanged sentences

and cash generated from real estate activities.

As of March 31, 2026, the Company had cash of $ 21,478,610 and restricted cash of $ 0 ,

compared to cash of $ 25,184,990 and restricted cash of $ 107,982 as of December 31, 2025.

Based on these factors and management’s

plans, management believes that the substantial doubt previously identified has been alleviated.

As of June 30, 2026, the Company had cash of $ 12,325,977 and restricted cash of $ 0 , compared

to cash of $ 25,184,990 and restricted cash of $ 107,982 as of December 31, 2025.

Based on these factors and management’s plans,

management believes that the substantial doubt previously identified has been alleviated.

there can be no assurance that the Company will be successful in executing its plans or generating sufficient liquidity, and failure

19 unchanged sentences

Company’s condensed consolidated financial statements include the financial position, results of operations and cash flows of the

following entities as of March 31, 2026 and December 31, 2025, as follows:

following entities as of June 30, 2026 and December 31, 2025, as follows:

SCHEDULE OF SUBSIDIARIES

of subsidiary

or other jurisdiction of

Name of subsidiary

State or other jurisdiction of

interest as of,

incorporation

or organization

consolidated under AEI

incorporation or organization

Alset Global Pte.

15 unchanged sentences

Winning Catering Group, Inc.

Development Inc.)

LiquidValue Development Inc.)

United States of America

55 unchanged sentences

Hapi Robot Service Pte.

Guangdong LeFu Wealth Investment Consulting

Dongguan Leyouyou Catering Management Co.,

Guangdong LeFu Wealth Investment Consulting Co., Ltd.

Dongguan Leyouyou Catering Management Co., Ltd.

Hapi Café Co., Ltd.

17 unchanged sentences

the year ended December 31, 2025, the Company disposed some subsidiaries which had no or very minimal activities.

The disposal of these

entities had immaterial effect on the Company’s consolidated financial statements and their deconsolidation did not meet the criteria

for presentation as discontinued operations under ASC 205-20.

During the six

months ended June 30, 2026, the Company also disposed of a subsidiary and recognized a gain on disposal of approximately $ 17,261 .

The disposal of these entities had immaterial effect on the Company’s consolidated financial statements and their

deconsolidation did not meet the criteria for presentation as discontinued operations under ASC 205-20.

preparation of financial statements in conformity with U.S.

23 unchanged sentences

a condition to the loan agreement with the Manufacturers and Traders Trust Company (“M&T Bank”), the Company was required

to maintain a minimum of $ 2,600,000

in an interest-bearing account maintained by the lender as

additional security for the loans.

The fund was required to remain as collateral for the loan and outstanding letters of credit until

the loan and letters of credit are paid off in full and the loan agreement is terminated.

The loan has expired during 2022 and only letters

of credit were outstanding as of December 31, 2025.

to maintain a minimum of $ 2,600,000 in an interest-bearing account maintained by the lender as additional security for the loans.

fund was required to remain as collateral for the loan and outstanding letters of credit until the loan and letters of credit are paid

off in full and the loan agreement is terminated.

The loan has expired during 2022 and only letters of credit were outstanding as of

December 31, 2025.

On February 11, 2026, approximately $ 107,991 was released from collateral for outstanding letters of credit.

In February 2026, the remaining outstanding letter of credit

was fully released, and the related letter-of-credit facility was closed.

As of March 31, 2026 and December 31, 2025, the total balance

of this account was $ 0

and $ 107,982 ,

respectively.

2026, the remaining outstanding letter of credit was fully released, and the related letter-of-credit facility was closed.

30, 2026 and December 31, 2025, the total balance of this account was $ 0 and $ 107,982 , respectively.

Receivables and Allowance for Credit Losses

11 unchanged sentences

uncollectible are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered

As of March 31, 2026 and December 31, 2025, the allowance for credit losses was an immaterial amount.

As of June 30, 2026 and December 31, 2025, the allowance for credit losses was an immaterial amount.

The Company does not have

any off-balance sheet credit exposure related to its customers.

As of March 31, 2026 and December 31, 2025, the balance of account receivables

As of June 30, 2026 and December 31, 2025, the balance of account receivables

was $ 56,068 and $ 57,002 , respectively.

7 unchanged sentences

is recognized in other income.

As of March 31, 2026 and December 31, 2025, $ 678,100 and $ 716,800 , respectively, in reimbursement amounts

As of June 30, 2026 and December 31, 2025, $ 632,000 and $ 716,800 , respectively, in reimbursement amounts

remained outstanding and is included in other receivables on the consolidated balance sheet.

2 unchanged sentences

The allowance

amount for these reimbursements was immaterial at March 31, 2026 and December 31, 2025.

amount for these reimbursements was immaterial at June 30, 2026 and December 31, 2025.

are stated at the lower of cost or net realizable value.

3 unchanged sentences

course of business less the estimated costs necessary to make the sale.

As of March 31, 2026 and December 31, 2025, inventory consisted

As of June 30, 2026 and December 31, 2025, inventory consisted

of finished goods from subsidiaries of HWH International Inc.

25 unchanged sentences

Company has significant influence over DSS.

As of March 31, 2026 and December 31, 2025, the Company owned approximately 43.6 % of

the common stock of DSS.

Our CEO, Chan Heng Fai, is an owner of additional common stock of DSS (not including any common or preferred

shares we hold).

As of June 30, 2026 and December 31, 2025, the Company owned approximately 39.4 % and

43.6 % of the common stock of DSS, respectively.

Our CEO, Chan Heng Fai, is an owner of additional common stock of DSS (not including

any common or preferred shares we hold).

In addition, our Chief Executive Officer is the Chairman of the Board of Directors of DSS.

Apart from Chan Heng

Fai, several other members of the Board of Directors of Alset Inc.

are also members of the Board of Directors of DSS (Chan Tung Moe,

our Co-Chief Executive Officer and a son of Chan Heng Fai, Lim Sheng Hon Danny, Wong Shui Yeung, Wu Wai William Leung, and Joanne

Wong Hiu Pan).

Apart from Chan Heng Fai, several other members of the Board of Directors of Alset Inc.

are also members of the Board of Directors

of DSS (Chan Tung Moe, our Co-Chief Executive Officer and a son of Chan Heng Fai, Lim Sheng Hon Danny, Wong Shui Yeung, Wu Wai William

Leung, and Joanne Wong Hiu Pan).

Company has significant influence over HIPH as the Company holds approximately 0.5 % of the common shares of HIPH and our Chief Executive

34 unchanged sentences

as well as Korea - originated beauty contents for the purpose of distribution to HWH’s membership distribution channel.

April 25, 2024, the Company entered into a binding term sheet through its subsidiary Health Wealth Happiness

(“HWHPL”) outlining a joint venture with Chen Ziping, an experienced entrepreneur in the travel industry, and Chan

Heng Fai, the Company’s Executive Chairman, as a part of the Company’s strategy of building its travel business in Asia.

The joint venture company (referred to here as the “JVC”) is known as HapiTravel Holding Pte.

The JVC was incorporated

in July 2024 and is owned by:

(a) HWHPL holds 19% of the shares in the JVC;

April 25, 2024, the Company entered into a binding term sheet through its subsidiary Health Wealth Happiness Pte Ltd.

outlining a joint venture with Chen Ziping, an experienced entrepreneur in the travel industry, and Chan Heng Fai, the Company’s

Executive Chairman, as a part of the Company’s strategy of building its travel business in Asia.

The joint venture company (referred

to here as the “JVC”) is known as HapiTravel Holding Pte.

The JVC was incorporated in July 2024 and is owned by:

HWHPL holds 19% of the shares in the JVC;

(b) Chan Heng Fai holds 11%;

and (c) the remaining 70% of

the shares in the JVC are held by Chen Ziping .

and (c) the remaining 70% of the shares in the JVC are held by

April 23, 2025, the Company completed the sale of HWH World Inc.

(“HWHKOR”) by Health Wealth Happiness Pte.

(“HWHPL”) to AES Group Inc.

to AES Group Inc.

(“AES”), a Korean entity.

The sale was consummated under a term sheet signed on

April 20, 2025, pursuant to which the Company agreed to transfer its 100 %

equity interest in HWHKOR to AES.

The sale was consummated under a term sheet signed on April 20, 2025, pursuant

to which the Company agreed to transfer its 100 % equity interest in HWHKOR to AES.

In exchange, AES agreed to issue new shares, representing

19.9 % of the enlarged share capital of AES to the Company upon closing.

Total of $ 384,356

gain was generated from this deal and recorded in the Company’s statement of operations.

The disposal of HWHKOR had immaterial

effect on the Company’s consolidated financial statements and the deconsolidation did not meet the criteria for presentation

as discontinued operations under ASC 205-20.

Total of $ 384,356 gain was generated from this deal and recorded

in the Company’s statement of operations.

The disposal of HWHKOR had immaterial effect on the Company’s consolidated financial

statements and the deconsolidation did not meet the criteria for presentation as discontinued operations under ASC 205-20.

has been no indication of impairment or changes in observable prices via transactions of similar securities in the remaining investments

21 unchanged sentences

(“LiquidValue”), a subsidiary of the Company, owns 16.4 % of American Medical REIT Inc.

as of March 31, 2026, a company concentrating on medical real estate.

as of June 30, 2026, a company concentrating on medical real estate.

AMRE acquires state-of-the-art, purpose-built healthcare facilities

3 unchanged sentences

Chan Heng Fai, our Chairman and CEO, is the executive chairman and director of AMRE.

DSS, of which we own 43.6 % and have

significant influence over, owns 80.8 % of AMRE.

DSS, of which we currently own 39.4 %

and have significant influence over, owns 80.8 % of AMRE.

Therefore, the Company has significant influence over AMRE.

The Company’s share

of losses from AMRE exceeded the carrying amount of the investment, and as a result, the Company suspended recognition of additional

The Company’s

share of losses from AMRE exceeded the carrying amount of the investment, and as a result, the Company suspended recognition of additional

The Company will resume recognizing its share of losses only to the extent that it subsequently becomes obligated to fund the

10 unchanged sentences

influence over APF.

During the three months ended March 31, 2026 and 2025, the investment loss

was $ 23,452 and $ 565,769 , respectively.

As of March 31, 2026 and December 31, 2025, the investment in APF was $ 2,384,946 and $ 2,408,398 ,

respectively.

During the three months ended June 30, 2026 and 2025, the investment loss was $ 18,639 and $ 722,950 loss, respectively.

During the six months ended June 30, 2026 and 2025, the investment loss was $ 42,091 and $ 1,288,719 , respectively.

As of June 30, 2026

and December 31, 2025, the investment in APF was $ 2,366,307 and $ 2,408,398 , respectively.

Brokers Company Inc.

9 unchanged sentences

a director position on Sentinel’s Board of Directors.

Additionally, DSS, of which we own 43.6% and have significant influence over,

owns 90% of Sentinel .

During the three months ended March 31, 2026, the investment loss in Sentinel was $ 2,070 .

During the three months

ended March 31, 2025, the investment loss in Sentinel was $ 65,799 .

Investment in Sentinel was $ 0 and $ 2,070 at March 31, 2026 and December

Additionally, DSS, of which we currently own 39.4% and have significant influence

over, owns 90% of Sentinel.

During the three months ended June 30, 2026 and 2025, the investment gain in Sentinel was $ 0 and $ 43,603 ,

respectively.

The Company’s share of losses from Sentinel exceeded the carrying amount of the investment, and as a result,

the Company suspended recognition of additional losses.

The Company will resume recognizing its share of losses only to the extent that

it subsequently becomes obligated to fund the investee’s losses or the investee returns to profitability and the Company’s

share of earnings exceeds its previously unrecognized losses.

During the six months ended June 30, 2026 and 2025, the investment loss in Sentinel was $ 0 and $ 22,196 , respectively.

in Sentinel was $ 0 and $ 2,070 at June 30, 2026 and December 31, 2025, respectively.

The Company’s share of losses from Sentinel

exceeded the carrying amount of the investment, and as a result, the Company suspended recognition of additional losses.

will resume recognizing its share of losses only to the extent that it subsequently becomes obligated to fund the investee’s losses

or the investee returns to profitability and the Company’s share of earnings exceeds its previously unrecognized losses.

Energy Asia Pacific Company Limited

13 unchanged sentences

New Energy focuses on distributing all-electric versions of special-purpose and transportation vehicles, charging stations and batteries.

During the three months ended March 31, 2026, the Company recognized its equity in loss of investee in New Energy of $ 83,000 .

During the three and six months ended June 30, 2026, the Company recognized its equity in loss of investee in New Energy of $ 81,368 and

$ 164,368 , respectively.

the year ended December 31, 2025, the Company recognized an impairment charge of approximately $ 30.1 million related to its investment

2 unchanged sentences

based on factors including:

delays in the execution and

commercialization of New Energy’s taxi delivery projects;

revised cash flow projections,

including slower ramp-up and longer implementation timelines;

in market conditions in the distributed energy sector, including broader global geopolitical

in the execution and commercialization of New Energy’s taxi delivery projects;

cash flow projections, including slower ramp-up and longer implementation timelines;

in market conditions in the distributed energy sector, including broader global geopolitical uncertainty.

Company valued its investment using a discounted cash flow methodology based on updated assumptions.

2 unchanged sentences

the Company reduced the carrying amount of the investment to its estimated fair value of approximately $ 52.7 million as of December 31,

Investment in New Energy was $ 52,622,000 at March 31, 2026.

Investment in New Energy was $ 52,540,632 at June 30, 2026.

in Debt Securities

12 unchanged sentences

extending beyond twelve months are classified as noncurrent assets.

As of March 31, 2026 and December 31, 2025, $ 84,395 and $ 75,108 of

As of June 30, 2026 and December 31, 2025, $ 103,042 and $ 75,108 of

deposits, respectively, were current and would be refundable within the next twelve months.

As of March 31, 2026 and December 31, 2025,

As of June 30, 2026 and December 31, 2025,

$ 175,147 and $ 212,119 of deposits, respectively, were noncurrent.

8 unchanged sentences

when lots are sold.

The Company did not capitalize construction costs during the three months ended March 31, 2026 and the year ended

December 31, 2025.

The Company did not capitalize construction costs during the six months ended June 30, 2026 and the year ended December

Company’s policy is to obtain an independent third-party valuation for each major project in the United States as part of our assessment

5 unchanged sentences

annual basis and on an interim basis if certain events or circumstances indicate that an impairment loss may have occurred.

Company did no t record impairment on any of its projects during the three months ended on March 31, 2026 and 2025.

Company did no t record impairment on any of its projects during the six months ended on June 30, 2026 and 2025.

properties are acquired with the intent to be rented to tenants.

As of March 31, 2026 and December 31, 2025, the Company owned 132 homes.

As of June 30, 2026 and December 31, 2025, the Company owned 132 homes.

The aggregate purchase cost of all the homes is $ 30,998,258 .

15 unchanged sentences

down to its estimated fair value.

The Company did not recognize any impairment losses during three months ended March 31, 2026 and 2025.

The Company did not recognize any impairment losses during six months ended June 30, 2026 and 2025.

of Model Houses

4 unchanged sentences

real estate sales was converted back to a garage.

July 14, 2023, 150 CCM Black Oak Ltd entered into a model home lease agreement with Davidson Homes, LLC (“Davidson”).

August 3, 2023, 150 CCM Black Oak Ltd entered into a development and construction agreement with Davidson Homes, LLC to build a model

house located in Montgomery County, Texas.

On January 4, 2024, 150 CCM Black Oak Ltd sent $ 220,076 to Davidson as reimbursement for final

construction cost and the contractor’s fee.

The model home lease commenced on January 1, 2024, lease term is twenty-four ( 24 ) full

months and annual base rent equals to twelve percentage (12%) of the total of the final cost of construction and the contractor’s

Starting January 1, 2026 Davidson’s contract continues on month-to-month basis.

July 2023, the Company entered into agreements with Davidson Homes, LLC for the construction and lease of a model home located in Montgomery

County, Texas.

The model home lease was terminated in May 2026.

The Company is currently converting the property into a residential rental

home, which it expects to lease to tenants.

Recognition and Cost of Sales

35 unchanged sentences

credited or charged to straight-line rent receivable or straight-line rent liability, as applicable.

For the three months ended March

For the six months ended June 30,

2026 and the year ended December 31, 2025, the Company did not recognize any deferred revenue and collected all rents due.

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to non-employees for goods and services.

During the three months ended March 31, 2026 and 2025, the Company did no t record any stock-based

During the three and six months ended June 30, 2026, the Company did no t record any stock-based

compensation expense.

During the three and six months ended on June 30, 2025, the Company recorded $ 840,000 as stock-based compensation

expense, which is included in General and Administrative expenses on the Company’s income statement.

The fair value of stock-based

compensation was determined based on the Company’s stock price on the date of issuance.

and reporting currency

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The Company recorded foreign exchange gain of $ 170,687 and foreign

exchange loss of $ 1,409,102 during the three months ended on March 31, 2026 and 2025, respectively.

The foreign currency transactional

gains and losses are recorded in operations.

exchange loss of $ 4,834,398 during the three months ended on June 30, 2026 and 2025, respectively.

The Company recorded foreign exchange

gain of $ 279,630 and foreign exchange loss of $ 6,243,500 during the six months ended on June 30, 2026 and 2025, respectively.

currency transactional gains and losses are recorded in operations.

of consolidated entities’ financial statements

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component of comprehensive income (loss).

Company recorded foreign currency translation adjustment gains within other comprehensive income of $ 247,103 and $ 1,417,410 for the three

months ended March 31, 2026 and 2025, respectively.

Company recorded other comprehensive loss of $ 744,447 from foreign currency translation for the three months ended June 30, 2026 and

$ 4,577,462 gain for the three months ended June 30, 2025, in accumulated other comprehensive loss.

The Company recorded other comprehensive

loss of $ 497,344 from foreign currency translation for the six months ended June 30, 2026 and $ 5,994,872 gain for the six months ended

June 30, 2025.

The foreign currency transactional gains and losses are recorded in operations.

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comprise convertible securities, such as stock options, convertible bonds and warrants.

At March 31, 2026 and December 31, 2025, there

were 425,216 potentially dilutive warrants outstanding.

At June 30, 2026 and December 31, 2025, there

were 0 and 425,216 potentially dilutive warrants outstanding, respectively.

and diluted net loss per share is the same for both periods presented, as all potentially dilutive securities were antidilutive due to

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and Investments

Company evaluates loans and investments for impairment at each reporting date.

For loans, impairment is recognized when it is probable

that the Company will be unable to collect all amounts due according to the contractual terms.

For investments, an impairment loss is

recorded if the decline in fair value is considered other-than-temporary.

Impairment losses are measured based on the difference between

the carrying amount and estimated fair value, with changes recognized in the consolidated statements of operations.

The Company evaluates loans and investments at each

reporting date in accordance with the applicable accounting guidance.

For loans and other financial assets measured at amortized cost,

the Company recognizes an allowance for credit losses in accordance with ASC 326, Financial Instruments—Credit Losses , based

on expected credit losses over the contractual term of the financial assets.

The Company considers historical loss experience, current

conditions, reasonable and supportable forecasts, the financial condition and payment history of the borrower, and other relevant factors

in estimating expected credit losses.

Certain convertible loan receivables are measured

at fair value under the fair value option, with changes in fair value recognized in earnings.

For investments, the Company accounts for

equity and debt investments in accordance with the applicable guidance based on the nature and classification of the investment.

and Equipment

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related party.

For the three months ended March 31, 2025, the Company presented other income and other expense as separate line

items in the condensed consolidated statements of operations.

Beginning in the three months ended March 31, 2026, the Company combined

these amounts and presented them on a net basis as other income, net, to conform to the current period presentation.

the three and six months ended June 30, 2025, the Company presented other income and other expense as separate line items in the condensed

consolidated statements of operations.

Beginning in the three months ended March 31, 2026, the Company combined these amounts and presented

them on a net basis as other income, net, to conform to the current period presentation.

of Previously Issued Financial Statements

connection with the preparation of the condensed consolidated financial statements for the six months ended June 30, 2026, the

Company identified that payroll and related employee benefit costs of personnel who directly support the business of the F&B

operation had been classified within general and administrative (“G&A”) expenses rather than within cost of sales in

prior periods.

generally accepted accounting principles, these costs are properly presented within cost of sales to

align with the functional activities of the personnel involved.

Accordingly, the accompanying condensed consolidated financial

statements for the three and six months ended June 30, 2026, reflect the appropriate classification, and the prior period

comparative amounts have been revised to conform to the current-period presentation

Company evaluated this misclassification, both quantitatively and qualitatively, in accordance with SEC Staff Accounting Bulletin

108, and concluded that it was not material to the previously issued financial statements.

Accordingly, the Company

has revised the prior period comparative amounts presented herein to correct the classification.

As a result of the revision, cost

of sales increased by $ 178,908

and $ 370,323 ,

and general and administrative expenses decreased by the same amounts, for the three and six months ended June 30, 2025,

respectively, resulting in a corresponding decrease in gross profit.

This reclassification has no effect on previously reported

total revenues, total operating expenses, loss from operations, net loss, total assets, total liabilities, stockholders’

equity, or net cash flows from operating, investing, or financing activities.

Accounting Pronouncements

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The adoption of this ASU did not have a material impact on our consolidated financial statements.

July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts

Receivable and Contract Assets .

The amendments provide a practical expedient for all entities when estimating expected credit losses

for current accounts receivable and current contract assets arising from transactions accounted for under ASC Topic 606, Revenue from

Contracts with Customers .

The practical expedient permits an entity, as part of developing reasonable and supportable forecasts,

to assume that current conditions as of the balance sheet date remain unchanged for the remaining life of the asset.

The amendments are

effective for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years, with early adoption

The adoption of this ASU did not have a material impact on our consolidated financial statements.

pronouncements pending adoption

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At times, these balances may exceed the insurance limits.

the three months ended March 31, 2026, no single customer accounted for 10 % or more of the Company’s revenue.

the three and six months ended June 30, 2026, no single customer accounted for 10 % or more of the Company’s revenue.

segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly

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reported as “Other” consist of corporate general and administrative activities which are not allocable to the four reportable

following table summarizes the Company’s segment information for the following balance sheet dates presented, and for the three

months ended March 31, 2026 and 2025:

following table summarizes the Company’s segment information for the six months ended June 30, 2026 and 2025:

OF SEGMENT INFORMATION

Transformation Technology

Three Months Ended on March 31, 2026

Transformation

Six Months Ended on June 30, 2026

Cost of Sales

( 1,276,645 )

( 1,610,333 )

Operating Expenses

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( 3,175,648 )

( 4,804,802 )

Operating Loss

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( 11,076,224 )

Transformation Technology

Three Months Ended on March 31, 2025

Transformation

Six Months Ended on June 30, 2025

Cost of Sales

( 1,254,761 )

( 1,990,898 )

Operating Expenses

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( 6,687,579 )

Other Income (Expense)

Other Expense

( 2,875,116 )

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REAL ESTATE ASSETS

of March 31, 2026 and December 31, 2025, real estate assets consisted of the following:

of June 30, 2026 and December 31, 2025, real estate assets consisted of the following:

OF REAL ESTATE ASSETS

& Improvements

Net Carrying Amount

Balance at December 31, 2025

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$ ( 4,495,450 )

& Improvements

Net Carrying Amount

Depreciation Expense

Balance at June 30, 2026

$ ( 4,764,129 )

Balance at December 31, 2024

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$ ( 3,420,733 )

Depreciation Expense

Balance at June 30, 2025

$ ( 3,689,412 )

family residential properties

of March 31, 2026 and December 31, 2025, the Company owned 132 Single Family Residential Properties (“SFRs”).

of June 30, 2026 and December 31, 2025, the Company owned 132 Single Family Residential Properties (“SFRs”).

The Company’s

aggregate investment in those SFRs was $ 31 million.

Depreciation expense was $ 268,679 and $ 268,679 in the three months ended March 31,

2026 and 2025, respectively.

These homes are located in Montgomery and Harris Counties, Texas.

following table presents the summary of our SFRs as of March 31, 2026:

Depreciation expense was $ 268,679 in the three months ended June 30, 2026 and 2025.

Depreciation expense was $ 537,358 in the six months ended June 30, 2026 and 2025.

These homes are located in Montgomery and Harris Counties,

following table presents the summary of our SFRs as of June 30, 2026:

OF SINGLE FAMILY RESIDENTIAL PROPERTIES

NOTES PAYABLE

of March 31, 2026 and December 31, 2025, notes payable consisted of the following:

of June 30, 2026 and December 31, 2025, notes payable consisted of the following:

OF NOTES PAYABLE

June 30, 2026

December 31, 2025

Motor Vehicle Loans

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Boral Capital LLC

notes payable

Total notes payable

April 17, 2019, SeD Maryland Development LLC entered into a Development Loan Agreement with Manufacturers and Traders Trust Company (“M&T

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The loan expired

during 2022 and only L/C is outstanding as of March 31, 2026 and December 31, 2025.

during 2022 and only L/C is outstanding as of June 30, 2026 and December 31, 2025.

On March 15, 2022 approximately $ 2,300,000 was released

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2028, the outstanding balance being paid annually until the balance owed is paid in full.

As of March 31, 2026, the Company accrued $ 126,757

As of December 31, 2025, the Company accrued

$ 118,557 in interest on the promissory note and owed $ 829,182 to D.

Boral Capital.

As of December 31, 2025, the Company accrued $ 118,557 in interest

on the promissory note and owed $ 829,182 to D.

Boral Capital.

The remaining principal will be repaid in three installments of $ 236,875 due in

October of 2026, 2027, and 2028.

April 16, 2026, the Company and D.

Boral Capital LLC entered into Amendment No.

1 to the Satisfaction and Discharge of Indebtedness,

pursuant to which D.

Boral Capital agreed to accept a one-time cash payment of $ 500,000 in full satisfaction of all amounts owed by the

Company to D.

Boral Capital under the underwriting agreement, the original satisfaction and discharge, and the related promissory note.

The payment was made on April 20, 2026, and upon payment the promissory note was cancelled.

The carrying amount of the obligation at

the settlement date was $ 839,185 , consisting of $ 710,625 of principal and $ 128,560 of accrued interest.

The Company accounted for the

transaction as an extinguishment of debt under ASC 470-50.

The $ 339,185 difference between the carrying amount of the obligation and

the cash consideration paid was recognized as a gain on extinguishment of debt in other income (expense) in the condensed consolidated

statements of operations for the three and six months ended June 30, 2026.

RELATED PARTY TRANSACTIONS

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level 3 category through a Black Scholes option pricing model.

The fair value of the HIPH warrants was $ 973 as of March 31, 2026 and

December 31, 2025.

The fair value of the HIPH warrants was $ 973 as of June 30, 2026 and December

Notes from Value Exchange

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price for the derivative security until Hapi Metaverse converts the Loan Amount into shares of VEII Common Stock.

The maturity date of

the note was extended to February 23, 2029 in March 2026.

In March 2026 the maturity

date of the note was extended to February 23, 2029.

September 6, 2023, Hapi Metaverse converted $ 1,300,000 of the principal amount loaned to VEII into 7,344,632 shares of VEII’s Common

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Such warrants expire five (5) years from date of their

On March 31, 2026 the fair value of the remaining $ 100,000 of convertible note and warrants was $ 19,699 and $ 18,227 , respectively.

On June 30, 2026 the fair value of the remaining $ 100,000 of convertible note and warrants was $ 15,291 and $ 0 , respectively.

On December 31, 2025 the fair value of the remaining $ 100,000 of convertible note and warrants was $ 10,860 and $ 18,301 , respectively.

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Common Shares pursuant to the terms of the 2 nd VEII Credit Agreement for a period of three years, until December 14, 2026.

The Company has subsequently confirmed with VEII the intent to extend the loan to December 14, 2027, with final terms to be formalized

prior to the original maturity.

The principal under the 2 nd VEII Credit Agreement accrues simple interest at 8 % per annum.

In the event that Hapi Metaverse

converts this loan into shares of VEII’s Common Stock, the conversion price shall be $ 0.045 per share.

In the event that Hapi Metaverse

elects to convert any portion of the loan into shares of VEII’s Common Stock in lieu of cash payment in satisfaction of that loan,

then VEII will issue to Hapi Metaverse five (5) detachable warrants for each share of VEII’s Common Stock issued in a conversion

(“Warrants”).

Each Warrant will entitle Hapi Metaverse to purchase one (1) share of VEII’s Common Stock at a per-share

exercise price equal to the Conversion Price.

The exercise period of each Warrant will be five (5) years from date of issuance of the

The fair value of this convertible note on March 31, 2026 and December 31, 2025 was $ 402,826 and $ 377,925 , respectively.

further details on fair value valuation refer to Note 11.

In the event that Hapi Metaverse converts this loan into shares of VEII’s Common Stock, the conversion price shall be $ 0.045 per

In the event that Hapi Metaverse elects to convert any portion of the loan into shares of VEII’s Common Stock in lieu of

cash payment in satisfaction of that loan, then VEII will issue to Hapi Metaverse five (5) detachable warrants for each share of VEII’s

Common Stock issued in a conversion (“Warrants”).

Each Warrant will entitle Hapi Metaverse to purchase one (1) share of VEII’s

Common Stock at a per-share exercise price equal to the Conversion Price.

The exercise period of each Warrant will be five (5) years

from date of issuance of the Warrant.

The fair value of this convertible note on June 30, 2026 and December 31, 2025 was $ 392,781 and

$ 377,925 , respectively.

(For further details on fair value valuation refer to Note 11.

– Assets Measured at Fair Value).

At the time of this filing, the Company has not converted the Loan Amount.

time of this filing, the Company has not converted the Loan Amount.

July 15, 2024, the Company entered into a Convertible Credit Agreement (“3 rd VEII Credit Agreement”) with VEII

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time of this filing, the Company has not converted the Loan Amount.

The fair value of this convertible note on March 31, 2026 and December

The fair value of this convertible note on June 30, 2026 and December

31, 2025 was $ 108,026 and $ 100,633 , respectively.

(For further details on fair value valuation refer to Note 11.

Measured at Fair Value).

– Assets Measured

at Fair Value).

At the time of this filing, the Company has not converted the Loan Amount.

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Common Stock, the conversion price shall be $ 0.0166 per share.

The fair value of this convertible note on March 31, 2026 and December

The fair value of this convertible note on June 30, 2026 and December

31, 2025 was $ 29,690 and $ 27,857 , respectively.

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1 st SHRG Convertible Note is November 5, 2026.

The fair value of this 1 st SHRG Convertible Note on March 31, 2026

At the time of this filing, the Company has not converted any of the note contemplated by the 1 st SHRG

Convertible Note.

The fair value of this 1 st SHRG Convertible Note on June 30, 2026

and December 31, 2025 was $ 263,529 and $ 258,409 , respectively.

1 unchanged sentence

Assets Measured at Fair Value).

March 20, 2024, HWH International Inc., a subsidiary of the Company, entered into a securities purchase agreement with SHRG,

pursuant to which HWH purchased from SHRG a (i) Convertible Promissory Note (the “2 nd SHRG Convertible Note) in the

amount of $ 250,000 ,

convertible into 148,810

shares of SHRG’s common stock at the option of HWH, and (ii) certain warrants exercisable into 148,810

shares of SHRG’s common stock at an exercise price of $ 1.68

per share, the exercise period of the warrant being five (5) years from the date of the securities purchase agreement, for an

aggregate purchase price of $ 250,000 .

2 nd SHRG Convertible Note bears a 6 %

interest rate and has scheduled maturity on March 20, 2027, three years from the date of the 2 nd SHRG Convertible Note.

At the time of this filing, HWH has not converted any of the debt contemplated by the 2 nd SHRG Convertible Note nor

March 20, 2024, HWH International Inc., a subsidiary of the Company, entered into a securities purchase agreement with SHRG, pursuant

to which HWH purchased from SHRG a (i) Convertible Promissory Note (the “2 nd SHRG Convertible Note) in the amount of

$ 250,000 , convertible into 148,810 shares of SHRG’s common stock at the option of HWH, and (ii) certain warrants exercisable into

148,810 shares of SHRG’s common stock at an exercise price of $ 1.68 per share, the exercise period of the warrant being five (5)

years from the date of the securities purchase agreement, for an aggregate purchase price of $ 250,000 .

2 nd SHRG Convertible

Note bears a 6 % interest rate and has scheduled maturity on March 20, 2027, three years from the date of the 2 nd SHRG Convertible

At the time of this filing, HWH has not converted any of the note contemplated by the 2 nd SHRG Convertible Note nor

exercised any of the warrants.

On March 31, 2026 the fair value of the 2 nd SHRG Convertible Note and warrants was $ 222,939

respectively.

On December 31, 2025, the fair value of the 2 nd SHRG Convertible Note and warrants was $ 227,909

On June 30, 2026 the fair value of the 2 nd SHRG Convertible Note and warrants was $ 233,613

and $ 8 , respectively.

On December 31, 2025, the fair value of the 2 nd SHRG Convertible Note and warrants was $ 227,909 and

$ 12 , respectively.

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At the time of this filing, HWH has not converted any of

the debt contemplated by the 3 rd SHRG Convertible Note.

On March 31, 2026 and December 31, 2025, the fair value of the 3 rd

the note contemplated by the 3 rd SHRG Convertible Note.

On June 30, 2026 and December 31, 2025, the fair value of the 3 rd

SHRG Convertible Note was $ 237,014 and $ 231,679 , respectively.

10 unchanged sentences

At the time of this filing, HWH has not converted

any of the debt contemplated by the 4 th SHRG Convertible Note.

On March 31, 2026 and December 31, 2025, the fair value of

the 4 th SHRG Convertible Note was $ 227,040 and $ 230,393 , respectively.

(For further details on fair value valuation refer

any of the note contemplated by the 4 th SHRG Convertible Note.

On June 30, 2026 and December 31, 2025, the fair value of the

4 th SHRG Convertible Note was $ 235,928 and $ 230,383 , respectively.

(For further details on fair value valuation refer to Note

– Assets Measured at Fair Value.)

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At the time of this

filing, HWH has not converted any of the debt contemplated by the 5 th SHRG Convertible Note.

On March 31, 2026 and December

filing, HWH has not converted any of the note contemplated by the 5 th SHRG Convertible Note.

On June 30, 2026 and December

31, 2025, the fair value of the 5 th SHRG Convertible Note was $ 93,551 and $ 91,066 , respectively.

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a loan to SHRG in the amount of $ 150,000 .

HWH may convert a portion or all of the outstanding balance due under the loan into shares of SHRG’s common stock at the average

closing market price of SHRG stock within the last three (3) days from the date of maturity of the 1 st Loan Agreement, January

15, 2026, which was extended to January 15, 2028.

The 1 st Loan Agreement bears an 8 %

interest rate .

At the time of this filing, HWH has not converted any of the debt contemplated by the 1 st Loan Agreement.

On March 31, 2026 and December 31, 2025, the fair value of the 1 st Loan Agreement was $ 140,436

and $ 160,941 ,

respectively.

HWH may convert a portion or all of the outstanding balance due under the loan into shares

of SHRG’s common stock at the average closing market price of SHRG stock within the last three (3) days from the date of maturity

of the 1 st Loan Agreement, January 15, 2026, which was extended to January 15, 2028.

The 1 st Loan Agreement bears

an 8 % interest rate.

At the time of this filing, HWH has not converted any of the note contemplated by the 1 st Loan Agreement.

On June 30, 2026 and December 31, 2025, the fair value of the 1 st Loan Agreement was $ 146,616 and $ 160,941 , respectively.

(For further details on fair value valuation refer to Note 11.

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of the securities purchase agreement at an exercise price of $ 0.85 per share, for an aggregate purchase price of $ 796,875 .

of this filing, HWH has not converted any of the debt contemplated by the 6 th SHRG Convertible Note nor converted any warrants.

On March 31, 2026, the fair value of the 6 th SHRG Convertible Note and warrants was $ 125,931 and $ 47 , respectively.

of this filing, HWH has not converted any of the note contemplated by the 6 th SHRG Convertible Note nor converted any warrants.

On June 30, 2026, the fair value of the 6 th SHRG Convertible Note and warrants was $ 135,209 and $ 47 , respectively.

31, 2025, the fair value of the 6 th SHRG Convertible Note and warrants was $ 127,260 and $ 75 , respectively.

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Additionally, upon execution SHRG incurred a commitment fee representing 5 % of the loan principal, $ 12,500 .

As of June 30,

2026, the loan had passed its maturity date and remained outstanding.

Accordingly, the outstanding balance was classified as a current

asset and included in note receivables - related party, net on the condensed consolidated balance sheet.

The Company is currently in

discussion with the borrower regarding a possible extension of the loan term.

April 21, 2025 HWH entered into a Loan Agreement (the “3 rd Loan Agreement”) with SHRG, under which the Company

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The maturity date of the 3 rd Loan Agreement is April 21, 2026 .

Agreement bears an 10 % interest rate.

June 27, 2025, HWH entered into a securities purchase agreement with SHRG pursuant to which HWH purchased from SHRG a Convertible

Promissory Note (the “7 th SHRG Convertible Note”) in the amount of $ 60,000 ,

convertible into 10,000,000

shares of SHRG’s common stock at the option of HWH for an aggregate purchase price of $ 60,000 ,

Additionally, upon signing the 7 th SHRG Convertible Note, SHRG owed the Company a commitment fee of 8 %

of the principal amount, $ 4,800

in total, to be paid either in cash or in common stock of SHRG, at the discretion of HWH.

The 7 th SHRG Convertible Note

interest rate and has a scheduled maturity on June 26, 2028.

At the time of filing, HWH has not converted any of the debt

contemplated by the 7 th SHRG Convertible Note.

On March 31, 2026 and December 31, 2025, the fair value of the

7 th SHRG Convertible Note was $ 50,580

and $ 52,535 ,

respectively.

Agreement bears a 10 % interest rate.

As of June 30, 2026, the loan had passed its maturity date and remained outstanding.

the outstanding balance was classified as a current asset and included in note receivables - related party, net on the condensed consolidated

balance sheet.

The Company is currently in discussion with the borrower regarding a possible extension of the loan term.

June 27, 2025, HWH entered into a securities purchase agreement with SHRG pursuant to which HWH purchased from SHRG a Convertible Promissory

Note (the “7 th SHRG Convertible Note”) in the amount of $ 60,000 , convertible into 10,000,000 shares of SHRG’s

common stock at the option of HWH for an aggregate purchase price of $ 60,000 , Additionally, upon signing the 7 th SHRG Convertible

Note, SHRG owed the Company a commitment fee of 8 % of the principal amount, $ 4,800 in total, to be paid either in cash or in common stock

of SHRG, at the discretion of HWH.

The 7 th SHRG Convertible Note bears an 8 % interest rate and has a scheduled maturity on

June 27, 2028.

At the time of filing, HWH has not converted any of the note contemplated by the 7 th SHRG Convertible Note.

On June 30, 2026 and December 31, 2025, the fair value of the 7 th SHRG Convertible Note was $ 53,519 and $ 52,535 , respectively.

(For further details on fair value valuation refer to Note 11.

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stock of SHRG, at HWH’s discretion.

On March 31, 2026 and December 31, 2025, the fair value of the 8 th SHRG Convertible

Note was $ 58,293 and $ 59,621 , respectively.

At the time of filing, HWH has not converted any of the note contemplated by the 8 th

SHRG Convertible Note.

On June 30, 2026 and December 31, 2025, the fair value of the 8 th SHRG Convertible Note was $ 62,061

and $ 59,621 , respectively.

(For further details on fair value valuation refer to Note 11.

– Assets Measured

at Fair Value.)

– Assets Measured at Fair Value.)

October 6, 2025, HWH entered into a securities purchase agreement with SHRG, pursuant to which HWH purchased from SHRG a Convertible

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either in cash or in common stock of SHRG, at HWH’s discretion.

At the time of filing, HWH has not converted any of the debt contemplated

At the time of filing, HWH has not converted any of the note contemplated

by the 9 th SHRG Convertible Note.

On March 31, 2026 and December 31, 2025, the fair value of the 9 th SHRG Convertible

On June 30, 2026 and December 31, 2025, the fair value of the 9 th SHRG Convertible

Note was $ 173,347 and $ 170,945 , respectively.

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At the time of filing, HWH has not converted any of the

debt contemplated by the 10 th SHRG Convertible Note.

On March 31, 2026 and December 31, 2025, the fair value of the 10 th

note contemplated by the 10 th SHRG Convertible Note.

On June 30, 2026 and December 31, 2025, the fair value of the 10 th

SHRG Convertible Note was $ 126,761 and $ 126,081 , respectively.

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either in cash or in common stock of SHRG, at HWH’s discretion.

At the time of filing, HWH has not converted any of the debt contemplated

At the time of filing, HWH has not converted any of the note contemplated

by the 11 th SHRG Convertible Note.

As of March 31, 2026, the 11 th SHRG Convertible Note was carried at cost of

As of June 30, 2026, the 11 th SHRG Convertible Note was carried at cost of $ 40,000 .

January 8, 2026, HWH entered into a securities purchase agreement with SHRG, pursuant to which HWH purchased from SHRG a Convertible

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HWH a commitment fee of 8 % of the principal amount, $ 9,600 in total, to be paid either in cash or in common stock of SHRG, at HWH’s

At the time of filing, HWH has not converted any of the debt contemplated by the 12 th SHRG Convertible Note.

of March 31, 2026, the 12 th SHRG Convertible Note was carried at cost of $ 120,000 .

At the time of filing, HWH has not converted any of the note contemplated by the 12 th SHRG Convertible Note.

of June 30, 2026, the 12 th SHRG Convertible Note was carried at cost of $ 120,000 .

February 4, 2026, HWH entered into a securities purchase agreement with SHRG, pursuant to which HWH purchased from SHRG a Convertible

5 unchanged sentences

HWH a commitment fee of 8 % of the principal amount, $ 10,000 in total, to be paid either in cash or in common stock of SHRG, at HWH’s

At the time of filing, HWH has not converted any of the debt contemplated by the 13 th SHRG Convertible Note.

of March 31, 2026, the 13 th SHRG Convertible Note was carried at cost of $ 125,000 .

Note from DSS

March 26, 2026, Alset International entered into a securities purchase agreement (the “DSS SPA”) with DSS, pursuant to which

Alset International lent DSS $ 2,450,000 , in exchange for a convertible promissory note (the “DSS Note”) and warrants to purchase

16,554,055 shares of DSS common stock (the “DSS Warrants”).

The DSS Note bears a simple interest rate of 3 % per annum.

the terms of the DSS Note, Alset International may convert any outstanding principal and interest into shares of DSS common stock at

At the time of filing, HWH has not converted any of the note contemplated by the 13 th SHRG Convertible Note.

of June 30, 2026, the 13 th SHRG Convertible Note was carried at cost of $ 125,000 .

Notes from DSS

March 26, 2026, Alset International entered into a securities purchase agreement (“DSS SPA #1”) with DSS, pursuant to which

Alset International lent DSS $ 2,450,000 , in exchange for a convertible promissory note (“DSS Note #1”) and warrants to purchase

16,554,055 shares of DSS common stock (“DSS Warrant #1”).

DSS Note #1 bears a simple interest rate of 3 % per annum.

the terms of DSS Note #1, Alset International may convert any outstanding principal and interest into shares of DSS common stock at $ 0.74

per share upon notice prior to maturity of the DSS Note five ( 5 ) years from the date of thereof.

The DSS Warrants to be issued

to Alset International are to purchase up to 16,554,055 shares of DSS common stock at an exercise price of $ 0.93 per share.

The DSS Warrants

expire on their fifth anniversary.

31, 2026, the DSS Note had a face value of $ 2,450,000 ,

unamortized premium of $ 317,196 ,

The DSS Warrants to be issued to Alset

International are to purchase up to 16,554,055 shares of DSS common stock at an exercise price of $ 0.93 per share.

DSS Warrant #1 expires

on its fifth anniversary.

of June 30, 2026, DSS Note #1 had a face value of $ 2,450,000 ,

unamortized discount of $ 296,050 ,

net carrying value of $ 2,153,950 ,

and accrued interest receivable of $ 19,332 .

Management concluded that the DSS Warrants meet the definition of derivative instruments under ASC 815 and, because the warrants are

Management concluded that DSS Warrant #1 meets the definition of derivative instruments under ASC 815 and, because the warrants are

indexed to the equity of a third party rather than the Company’s own stock, the scope exception under ASC 815-10-15-74 does

Accordingly, the DSS Warrants are recognized as derivative assets and remeasured at fair value at each reporting date,

with changes in fair value recognized in earnings.

The fair value of the DSS Warrants as of March 31, 2026 was $ 2,951,588 .

Accordingly, the warrants are recognized as derivative assets and remeasured at fair value at each reporting date, with

changes in fair value recognized in earnings.

The fair value of DSS Warrant #1 as of June 30, 2026 was $ 1,189,905 .

June 23, 2026, the Company entered into a securities purchase agreement (“DSS SPA #2”) with DSS pursuant to which the Company

loaned DSS $ 1,000,000 , in exchange for a convertible promissory note (“DSS Note #2”) and warrants to purchase 17,777,776

shares of DSS common stock (“DSS Warrant #2”).

DSS Note #2 is payable upon demand.

DSS Note #2 will bear a simple interest

rate of 3 % per annum.

Under the terms of DSS Note #2, the Company may convert any outstanding principal and interest into shares of DSS

common stock at $ 0.45 per share upon notice prior to maturity of DSS Note #2 five (5) years from the date of thereof.

DSS Warrant #2

will be exercisable into up to 17,777,776 shares of DSS common stock at an exercise price of $ 0.50 per share.

DSS Warrant #2 expires

on its third anniversary.

The fair value of DSS Warrant #2 as of June 30, 2026 was $ 1,274,489 .

SPA #2, DSS Note #2, and DSS Warrant #2 require the approval of DSS’ stockholders, prior to the conversion of the note or exercise

of the warrants.

of June 30, 2026, DSS Note #2 had a face value of $ 1,000,000 ,

unamortized discount of $ 304,649 ,

net carrying value of $ 695,351 ,

and accrued interest receivable of $ 583 .

Management concluded that DSS Warrant #2 meets the definition of derivative instruments under ASC 815 and, because the warrants are

indexed to the equity of a third party rather than the Company’s own stock, the scope exception under ASC 815-10-15-74 does

Accordingly, the warrants are recognized as derivative assets and remeasured at fair value at each reporting date, with

changes in fair value recognized in earnings.

The fair value of DSS Warrant #2 as of June 30, 2026 was $ 1,274,489 .

Facility Agreement with HWH

1 unchanged sentence

dated April 24, 2024, pursuant to which the Company provided HWH a line of credit facility (the “Credit Facility”) which

provides a maximum, aggregate credit line of up to $ 1,000,000 .

provided a maximum, aggregate credit line of up to $ 1,000,000 .

Under the terms of the Amendment, the date upon which each advance made

under the Credit Facility and all accrued but unpaid interest shall be due and payable was extended from April 24, 2025 to April 14,

Further, pursuant to the Amendment, HWH released Alset International Limited from its obligations under its Letter of Continuing

Financial Support to HWH dated March 28, 2025.

The terms of the Company’s Letter of Continuing Financial Support to HWH were not

altered by the Amendment.

under the Credit Facility and all accrued but unpaid interest were due and payable was extended from April 24, 2025 to April 14, 2026.

Further, pursuant to the Amendment, HWH released Alset International Limited from its obligations under its Letter of Continuing Financial

Support to HWH dated March 28, 2025.

The terms of the Company’s Letter of Continuing Financial Support to HWH were not altered

by the Amendment.

As of the issuance of these quarterly condensed consolidated financial statements, the Company is still in discussion

with HWH regarding the possible extension of the Amendment to the Credit Agreement.

of IBO Shares

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closing of the transactions contemplated by the Amended Term Sheet occurred on July 23, 2025.

the three months ended March 31, 2026 and the year ended December 31, 2025, the Company recognized its equity in loss of investee in

New Energy of $ 83,000 and $ 212,246 , respectively.

the three and six months ended June 30, 2026, the Company recognized its equity in loss of investee in New Energy of $ 81,368 and $ 164,368 ,

respectively.

the year ended December 31, 2025, the Company recognized an impairment charge of approximately $ 30.1 million related to its investment

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based on factors including:

delays in the

execution and commercialization of New Energy’s taxi delivery projects;

in the execution and commercialization of New Energy’s taxi delivery projects;

cash flow projections, including slower ramp-up and longer implementation timelines;

in market conditions in the distributed energy sector, including broader global geopolitical

in market conditions in the distributed energy sector, including broader global geopolitical uncertainty.

Company valued its investment using a discounted cash flow methodology based on updated assumptions.

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the Company reduced the carrying amount of the investment to its estimated fair value of approximately $ 52.7 million as of December 31,

Investment in New Energy was $ 52,622,000 at March 31, 2026.

Investment in New Energy was $ 52,540,632 at June 30, 2026.

Heng Fai provided an interest-free, due on demand advance to SeD Perth Pty.

for its general operations.

As of March 31, 2026 and

As of June 30, 2026 and

December 31, 2025, the outstanding balance was $ 12,853 and $ 12,500 , respectively.

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for its general operations.

As of March 31, 2026 and

As of June 30, 2026 and

December 31, 2025, the outstanding balance was $ 4,135 and $ 4,168 , respectively.

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for its general operations.

As of March 31, 2026 and December 31, 2025, the outstanding balance was $ 4,818 and $ 4,263 , respectively.

As of June 30, 2026 and December 31, 2025, the outstanding balance was $ 4,806 and $ 4,840 , respectively.

Equity Partners, LLC, an entity owned by Charles MacKenzie, Chief Development Officer of the Company, has a consulting agreement with

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certain bonuses, including a sum of $75,000 in May 2025 and $120,000 in December 2025.

Company incurred expenses of $ 75,000 and $ 75,000 in the three months ended March 31, 2026 and 2025, respectively.

On March 31, 2026 and

December 31, 2025, the Company owed this related party $ 25,000 and $ 39,529 , respectively.

These amounts are included in Accounts Payable

in the accompanying condensed consolidated balance sheets.

Company incurred expenses of $ 75,000 and $ 150,000 in the three and six months ended June 30, 2026, respectively.

The Company incurred

expenses of $ 150,000 and $ 225,000 in the three and six months ended June 30, 2025, respectively.

On June 30, 2026 and December 31, 2025,

the Company owed this related party $ 25,000 and $ 39,529 , respectively.

These amounts are included in Accounts Payable in the accompanying

condensed consolidated balance sheets.

Receivable from Related Party

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in the loan agreement.

As of March 31, 2026 and December 31, 2025 LVAML owed the Company $ 33,036 .

As of June 30, 2026 and December 31, 2025 LVAML owed the Company $ 33,036 .

September 28, 2023 Alset International Limited (“Alset International”) entered into loan agreement with Value Exchange International

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During first quarter of 2025, the Company lent HTHPL additional $ 19,053 .

As of March 31, 2026 and December 31, 2025 the Company accrued

$ 8,977 and $ 7,168 in interest, respectively, and impaired $ 25,789 and $ 139,514 at March 31, 2026 and December 31, 2025, respectively.

As of March 31, 2026 and December 31, 2025 HTHPL owed $ 953 and $ 25,789 , respectively, to the Company.

As of June 30, 2026 and December 31, 2025 the Company accrued

$ 10,794 and $ 7,168 in interest, respectively, and impaired $ 25,789 and $ 139,514 at June 30, 2026 and December 31, 2025, respectively.

As of June 30, 2026 and December 31, 2025 HTHPL owed $ 3,585 and $ 25,789 , respectively, to the Company.

July 18, 2025, the Company’s subsidiary signed a loan agreement with HapiTravel Holding Pte.

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rate of 5 % per annum, the maturity date of which is on or before the third anniversary of the effective date.

As of March 31, 2026 and

As of June 30, 2026 and

December 31, 2025, the Company accrued $ 13,148 and $ 6,230 in interest, respectively.

As of March 31, 2026 and December 31, 2025, HTHPL

As of June 30, 2026 and December 31, 2025, HTHPL

owed $ 291,244 and $ 286,555 to the Company, respectively.

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from the date of the promissory note.

As of March 31, 2026 and December 31, 2025, the Company accrued $ 5,799 and $ 4,839 in interest,

respectively, and HTHPL repaid $ 17,248 in 2025.

As of March 31, 2026 and December 31, 2025 HTHPL owed $ 70,515 and $ 70,043 , respectively,

to the Company.

As of June 30, 2026 and December 31, 2025, the Company accrued $ 6,767 and $ 4,839 in interest, respectively,

and HTHPL repaid $ 17,248 in 2025.

As of June 30, 2026 and December 31, 2025 HTHPL owed $ 71,413 and $ 70,043 , respectively, to the Company.

January 23, 2025 the Company’s subsidiary entered into loan agreement with New Energy Asia Pacific Company Limited (“New

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rate of 8 % and is due on January 23, 2026.

As of March 31, 2026 and December 31, 2025, the Company accrued $ 6,565 and $ 5,197 in interest,

As of June 30, 2026 and December 31, 2025, the Company accrued $ 7,947 and $ 5,197 in interest,

respectively, and New Energy Asia owed $ 77,365 and $ 74,614 , respectively, to the Company.

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The loan carries simple annual interest rate of 8 % and is due on March 26, 2029.

As of March 31,

As of June 30,

2026, the Company accrued $ 15,004 in interest, and New Energy Asia owed $ 721,472 , to the Company.

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of filing, the Company has not converted any of the debt contemplated by DSS Convertible Note.

As of March 31, 2026 and December 31,

As of June 30, 2026 and December 31, 2025,

the Company accrued $ 29,315 and $ 12,579 in interest and DSS owed $ 529,315 and $ 512,579 , to the Company, respectively.

August 22, 2025, the Company’s subsidiary paid a bill on behalf of Value Exchange International (Hong Kong) Limited (“VEIHK”),

a fellow subsidiary of VEII, in the amount of $ 33,953 as an interest-free loan, which is due on demand.

September 5, 2025, the Company’s subsidiary entered into a loan agreement with VEIHK, in the amount of $ 84,820 at a rate of 8 %

August 22, 2025, the Company’s subsidiary paid a bill on behalf of Value Exchange International (Hong Kong) Limited

(“VEIHK”), a fellow subsidiary of VEII, in the amount of $ 34,185

as an interest-free loan, which is due on demand.

As of June 30, 2026 and December 31, 2025 VEIHK owed $ 34,557 and $ 34,190 , to the Company, respectively.

between the periods was primarily attributable to fluctuations in foreign currency exchange rates.

September 5, 2025, the Company’s subsidiary entered into a loan agreement with VEIHK, in the amount of $ 84,820

at a rate of 8 %

per annum, the maturity date of which is on or before the three months of the effective date.

In the first three months of 2026 VEIHK

repaid $ 28,082 of the loan.

As of March 31, 2026 and December 31, 2025, the Company accrued $ 2,189 and $ 2,189 in interest and VEIHK owed

$ 58,423 and $ 87,009 , to the Company, respectively.

In the first six months of 2026 VEIHK repaid

As of June 30, 2026 and December 31, 2025, the

Company accrued $ 2,189

in interest and VEIHK owed $ 30,311

and $ 87,009 ,

to the Company, respectively.

The Company entered into a verbal agreement with VEIHK pursuant to which the Company agreed to cease accruing interest

on the outstanding balance after December 31, 2025, and VEIHK agreed to repay the outstanding balance during 2026.

October 1, 2025, the Company paid a bill on behalf of Value Exchange International Inc.

1 unchanged sentence

rate and is due on demand.

As of March 31, 2026 and December 31, 2025 the Company accrued $ 298 and $ 150 in interest and VEII owed $ 7,798

As of June 30, 2026 and December 31, 2025 the Company accrued $ 447 and $ 150 in interest and VEII owed $ 7,947

and $ 7,650 , to the Company, respectively.

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Agent a cash fee of 7 % of the aggregate gross proceeds raised in the Offering and reimbursed certain expenses of the Placement Agent.

March 31, 2026, there were 39,401,786 common shares issued and 38,895,830

common shares outstanding.

following table summarizes the warrant activity for the three months ended March 31, 2026.

June 30, 2026, there were 39,401,786 common shares issued and 38,895,830 common shares outstanding.

following table summarizes the warrant activity for the six months ended June 30, 2026.

OF WARRANT ACTIVITY

Exercise Price

Warrants Outstanding as of December 31, 2025

Warrants Vested and exercisable at December 31, 2025

cancelled, expired

Warrants Outstanding as of March 31, 2026

Warrants Vested and exercisable at March 31,

Forfeited, cancelled, expired

Warrants Outstanding as of June 30, 2026

Warrants Vested and exercisable at June 30, 2026

of HWH Shares to D.

43 unchanged sentences

Future minimum rental revenue under existing

leases on our properties at March 31, 2026 in each calendar year through the end of their terms are as follows:

leases on our properties at June 30, 2026 in each calendar year through the end of their terms are as follows:

OF FUTURE MINIMUM RENTAL PAYMENTS

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The Company pays its property managers a monthly property management fee for each property unit and a leasing fee.

For the three months ended March 31, 2026 and 2025, property management fees incurred by the property managers were $ 35,910 and $ 35,640 ,

respectively.

For the three months ended March 31, 2026 and 2025, leasing fees incurred by the property managers were $ 16,160 and $ 13,845 ,

For the three months ended June 30, 2026 and 2025, property management fees incurred by the property managers were $ 36,000 and $ 35,730 ,

respectively.

For the six months ended June 30, 2026 and 2025, property management fees incurred by the property managers were $ 71,910

and $ 71,370 , respectively.

For the three months ended June 30, 2026 and 2025, leasing fees incurred by the property managers were $ 30,545

and 15,645 , respectively.

For the six months ended June 30, 2026 and 2025, leasing fees incurred by the property managers were $ 46,705

and $ 29,490 , respectively.

ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

3 unchanged sentences

$ ( 2,505,799 )

Other Comprehensive Income

Other Comprehensive Income (Loss)

Balance at March 31, 2026

$ ( 2,293,883 )

Balance at January 1, 2025

$ ( 3,960,871 )

Other Comprehensive Income (Loss)

Balance at June 30, 2026

$ ( 2,932,321 )

Balance, Beginning

$ ( 256,204 )

Balance at January 1, 2025

$ ( 3,960,871 )

Other Comprehensive Income

$ ( 849,862 )

Other Comprehensive Income (Loss)

Balance at March 31, 2025

$ ( 2,745,300 )

Balance, Ending

Balance, Beginning

$ ( 2,745,300 )

Other Comprehensive Income

Other Comprehensive Income (Loss)

Balance at June 30, 2025

Balance, Ending

ASSETS MEASURED AT FAIR VALUE

assets measured at fair value on a recurring basis are summarized below and disclosed on the condensed consolidated balance sheet as

of March 31, 2026 and December 31, 2025:

of June 30, 2026 and December 31, 2025:

SCHEDULE OF FINANCIAL ASSETS MEASURED AT FAIR VALUE ON A RECURRING BASIS

Value Measurement Using

March 31, 2026

Investment Securities- Fair Value

Fair Value Measurement Using

June 30, 2026

Investment Securities- Fair Value Option

Investment Securities- Trading

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Convertible Loan Receivable - VEII

Convertible Loan Receivable

Convertible Loan Receivable - SHRG

Total Assets at Fair Value

Value Measurement Using

Fair Value Measurement Using

December 31, 2025

Investment Securities- Fair Value

Investment Securities- Fair Value Option

Investment Securities- Trading

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Convertible Loan Receivable - VEII

Convertible Loan Receivable

Convertible Loan Receivable - SHRG

Total Investment in Securities at Fair Value

loss on investment securities for the three months ended March 31, 2026 was $ 447,599 and realized loss on investment securities for the

three months ended March 31, 2025 was $ 180,096 .

Unrealized gain on securities investment was $ 2,571,644 and $ 3,520,747 in the three months

ended March 31, 2026 and 2025, respectively.

These gains and losses were recorded directly to net loss.

following chart shows details of the fair value of equity security investment at March 31, 2026 and December 31, 2025, respectively.

gain on investment securities for the three months ended June 30, 2026 was $ 228,133 and realized loss on investment securities for the

three months ended June 30, 2025 was $ 2,929,288 .

Realized loss on investment securities for the six months ended June 30, 2026 was $ 219,466

and realized loss on investment securities for the six months ended June 30, 2025 was $ 3,109,384 .

Unrealized loss on securities investment

was $ 4,831,988 and unrealized gain was $ 2,236,652 in the three months ended June 30, 2026 and 2025, respectively.

Unrealized loss on

securities investment was $ 7,403,632 and $ 1,284,095 loss in the six months ended June 30, 2026 and 2025, respectively.

These gains and

losses were recorded directly to net loss.

following chart shows details of the fair value of equity security investment at June 30, 2026 and December 31, 2025, respectively.

SCHEDULE OF FAIR VALUE OF EQUITY SECURITY INVESTMENT

Investment in Securities at Fair

Value – Related Party

Investment in Securities

at Fair Value

Level 1 Equity Securities

Investment in Securities at Fair Value

Value Exchange (Related

Investment in Securities at Fair Value –

Related Party

HIPH World (Related Party)

Investment in Securities at Fair Value –

Related Party

Sharing Services (Related

Investment in Securities at Fair Value –

Related Party

Investment in Securities

at Fair Value

Level 2 Equity Securities

Investment in Securities at Cost

Ideal Food and Beverages

Investment in Securities at Cost

HapiTravel Holding

Investment in Securities at Cost

Investment in Securities

Equity Securities

Investment in Securities at Fair

Value – Related Party

Investment in Securities

at Fair Value

Level 1 Equity Securities

Investment in Securities at Fair Value

DSS (Related Party)

Investment in Securities at Fair Value – Related Party

Trading Stocks

Investment in Securities at Fair Value

Value Exchange (Related

Total Level 1 Equity Securities

Investment in Securities at Fair Value

Related Party

Sharing Services (Related

Investment in Securities at Fair Value

Related Party

Value Exchange (Related Party)

Investment in Securities at Fair Value – Related Party

HIPH World (Related Party)

Investment in Securities at Fair Value –

Related Party

Investment in Securities at Fair Value – Related Party

Sharing Services (Related Party)

Investment in Securities at Fair Value – Related Party

Trading Stocks

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Equity Securities

(Related Party)

in Securities at Fair Value – Related Party

in Securities at Fair Value

Level 1 Equity Securities

in Securities at Fair Value

Exchange (Related Party)

in Securities at Fair Value – Related Party

Services (Related Party)

in Securities at Fair Value – Related Party

World (Related Party)

in Securities at Fair Value – Related Party

in Securities at Fair Value

Level 2 Equity Securities

in Securities at Cost

Food and Beverages

in Securities at Cost

Equity Securities

in the observable input values would likely cause material changes in the fair value of the Company’s Level 3 financial instruments.

2 unchanged sentences

in and/or out of all financial assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during

the three months ended March 31, 2026 and 2025:

the six months ended June 30, 2026 and 2025:

SCHEDULE OF CHANGE IN FAIR VALUE

1 unchanged sentence

Balance at March 31, 2026

Balance at June 30, 2026

Balance at January 1, 2025

Balance at March 31, 2025

Balance at June 30, 2025

July 17, 2020, the Company purchased 122,039,000 shares, approximately 0.5 % ownership, and 1,220,390,000 warrants with an exercise price

3 unchanged sentences

of 988,390,000 at December 31, 2022.

The Company did not exercise any warrants during three months ended March 31, 2026 and the year

ended December 31, 2025.

We value HIPH warrants under level 3 category through a Black Scholes option pricing model and the fair value

of the warrants from HIPH was $ 973 as of March 31, 2026 and December 31, 2025.

fair value of the HIPH warrants under level 3 category as of March 31, 2026 and December 31, 2025 was calculated using a Black-Scholes

The Company did not exercise any warrants during six months ended June 30, 2026 and the year ended

December 31, 2025.

We value HIPH warrants under level 3 category through a Black Scholes option pricing model and the fair value of the

warrants from HIPH was $ 973 as of June 30, 2026 and December 31, 2025.

fair value of the HIPH warrants under level 3 category as of June 30, 2026 and December 31, 2025 was calculated using a Black-Scholes

valuation model valued with the following weighted average assumptions:

SCHEDULE OF SIGNIFICANT INPUTS AND ASSUMPTIONS

June 30, 2026

December 31, 2025

Exercise price

6 unchanged sentences

transaction, refer to Note 7 - Related Party Transactions, Note Receivable from a Related Party Company .

As of March 31, 2026

and December 31, 2025, the fair value of the warrants was $ 18,227 and $ 18,301 , respectively.

The Company did not exercise any warrants

during the three months ended March 31, 2026 and the year ended December 31, 2025.

fair value of the VEII warrants under level 2 category as of March 31, 2026, and December 31, 2025 was calculated using a Black-Scholes

As of June 30, 2026 and

December 31, 2025, the fair value of the warrants was $ 0 and $ 18,301 , respectively.

The Company did not exercise any warrants during

the six months ended June 30, 2026 and the year ended December 31, 2025.

fair value of the VEII warrants under level 2 category as of June 30, 2026, and December 31, 2025 was calculated using a Black-Scholes

valuation model valued with the following weighted average assumptions:

SCHEDULE OF SIGNIFICANT INPUTS AND ASSUMPTIONS

June 30, 2026

December 31, 2025

Exercise price

10 unchanged sentences

any of the warrants.

As of March 31, 2026 and December 31, 2025, the fair value of the warrants was $ 7 and $ 12 , respectively.

fair value of the 148,810 SHRG warrants under level 2 category as of March 31, 2026 and December 31, 2025, was calculated using binomial

As of June 30, 2026 and December 31, 2025, the fair value of the warrants was $ 8 and $ 12 , respectively.

fair value of the 148,810 SHRG warrants under level 2 category as of June 30, 2026 and December 31, 2025, was calculated using binomial

option pricing model valued with the following weighted average assumptions:

SCHEDULE OF SIGNIFICANT INPUTS AND ASSUMPTIONS

June 30, 2026

December 31, 2025

Exercise price

13 unchanged sentences

contemplated by the Convertible Note nor exercised any of the warrants.

As of March 31, 2026 and December 31, 2025, the fair value of

As of June 30, 2026 and December 31, 2025, the fair value of

the warrants was $ 47 and $ 75 , respectively.

fair value of the 937,500 SHRG warrants under level 2 category as of March 31, 2026, was calculated using binomial option pricing model

fair value of the 937,500 SHRG warrants under level 2 category as of June 30, 2026, was calculated using binomial option pricing model

valued with the following weighted average assumptions:

SCHEDULE OF SIGNIFICANT INPUTS AND ASSUMPTIONS

June 30, 2026

December 31, 2025

Exercise price

9 unchanged sentences

of the convertible loans is calculated using the binomial tree model based on probability of remaining as straight debt using discounted

the three months ended March 31, 2026, the Company reclassified some of “Convertible Loan Receivables – Related

Party” from current assets to noncurrent assets in the consolidated balance sheet as of December 31, 2025, based on

management’s assessment of the expected holding period.

This change in classification had no impact on the Company’s

consolidated statements of operations, cash flows, or shareholders’ equity.

the six months ended June 30, 2026, the Company reclassified some of “Convertible Loan Receivables – Related Party”

from current assets to noncurrent assets in the consolidated balance sheet as of December 31, 2025, based on management’s assessment

of the expected holding period.

This change in classification had no impact on the Company’s consolidated statements of operations,

cash flows, or shareholders’ equity.

Company leases offices in Maryland, Singapore, Hong Kong, South Korea, China and Taiwan through leased spaces aggregating approximately

25,000 square feet, under leases expiring on various dates from May 2026 to April 2029.

25,000 square feet, under leases expiring on various dates from June 2026 to April 2029.

The leases have rental rates ranging from $ 1,321

to $ 14,431 per month.

Our total rent expense under these leases was $ 185,741 and $ 235,500 in the three months ended March 31, 2026 and

2025, respectively.

The total cash paid for rent under these leases was $ 274,275 and $ 222,773 in the three months ended March 31, 2026

Our total rent expense under these office leases was $ 172,751 and $ 93,038 in the three months ended June 30, 2026

and 2025, respectively.

Our total rent expense under these office leases was $ 358,492 and $ 328,538 in the six months ended June, 2026

and 2025, respectively.

The total cash paid for rent under these office leases was $ 345,229 and $ 423,737 in the six months ended June

30, 2026 and 2025, respectively.

The following table outlines the details of lease terms:

SCHEDULE OF OPERATING AND RENEWED LEASE TERMS RENTAL

Term as of March 31, 2026

2023 to May 2026

Term as of June 30, 2026

2023 to June 2026 *

2024 to September 2027

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2024 to October 2027

2024 to August 2026

Kong - Office

2025 to January 2028

Hong Kong - Warehouse

May 2026 to April 2028

* The lease was subsequently renewed for the period from August 2026 through August 2029.

Company adopted ASU No.

12 unchanged sentences

The balances of operating lease right-of-use assets and operating

lease liabilities as of March 31, 2026 were $ 373,960 and $ 703,421 , respectively.

lease liabilities as of June 30, 2026 were $ 421,487 and $ 731,842 , respectively.

The balance of operating lease right-of-use assets and

operating lease liabilities as of December 31, 2025 were $ 494,957 and $ 910,951 , respectively.

table below summarizes future payments due under these leases as of March 31, 2026.

the Twelve Months Ending March 31:

table below summarizes future payments due under these leases as of June 30, 2026.

the Twelve Months Ending June 30:

SCHEDULE OF LEASE PAYMENTS

2 unchanged sentences

Present Value of Future Minimum Lease Payments

Current Obligations

Current Obligations under Leases

Long-term Lease Obligations

13 unchanged sentences

lease termination.

As of March 31, 2026 and December 31, 2025, the security deposits held in the trust account were $ 281,855 and $ 293,135 ,

As of June 30, 2026 and December 31, 2025, the security deposits held in the trust account were $ 295,635 and $ 293,135 ,

respectively.

7 unchanged sentences

SUBSEQUENT EVENTS

Company has evaluated all subsequent events and transactions through May 14, 2026, the date that the consolidated financial statements

Company has evaluated all subsequent events and transactions through August 14, 2026, the date that the consolidated financial statements

were available to be issued and noted no subsequent events requiring financial statement recognition or disclosure other than noted below:

Satisfaction and Discharge of Indebtedness

April 16, 2026, HWH International Inc.

Boral Capital, LLC (“D.

Boral Capital”) entered into an amendment to certain

Satisfaction and Discharge of Indebtedness Agreement dated December 18, 2023.

Under the terms of the amendment, D.

Boral Capital accepted

a one-time payment of $ 500,000 from the Company as satisfaction of the Company’s further obligations and indebtedness under the

Satisfaction and Discharge of Indebtedness Agreement and the promissory note in lieu of principal and interest otherwise owed and scheduled

The settlement for $ 500,000 was paid on April 20, 2026.

Term Sheet for Investment in Smart

Dynamics Technology Limited

May 5, 2026, HWH International Inc.

entered into a term sheet with Smart Dynamics Technology Limited,

a company incorporated in the British Virgin Islands (the “Investor”), pursuant to which HWH International has agreed to sell to

the Investor, for an aggregate purchase price of $ 10,000,000 :

20,000,000 newly issued unregistered shares of HWH International’s common stock;

warrants to purchase 160,000,000

newly issued, unregistered shares of HWH International’s

common stock at an exercise price of $ 0.63

per share, exercisable immediately and expiring on the fourth

anniversary of their issuance.

HWH International Inc.

Change of Control

On May 27, 2026, HWH International Inc.

a majority-owned subsidiary of the Company as of June 30, 2026, entered into a Securities Purchase Agreement with Smart Dynamics Technology

Limited (the “Purchaser”), pursuant to which HWH agreed to issue and sell (i) 20,000,000 shares of HWH’s common stock

and (ii) warrants to purchase up to 160,000,000 shares of HWH’s common stock at an exercise price of $ 0.63 per share, exercisable

immediately and expiring on August 10, 2030 , for aggregate consideration of $ 10,000,000 .

The agreement was amended on June 8, 2026, and

the transaction was approved by HWH’s stockholders on June 12, 2026.

The transaction subsequently closed on August 10,

2026, and HWH issued the 20,000,000 shares and warrants described above.

Following the closing, the Purchaser owned approximately 67.3 %

of HWH’s outstanding common stock and became the controlling stockholder of HWH.

Immediately prior to the closing, the Company beneficially

owned approximately 56.9 % of HWH’s outstanding common stock.

As a result of the transaction, the Company ceased to have a controlling financial interest

in HWH on August 10, 2026.

Following the closing, the Company beneficially owns approximately 18.6 % of HWH’s outstanding common

Accordingly, beginning on August 10, 2026, the Company will no longer consolidate HWH in its consolidated financial statements

and will account for its remaining investment in HWH in accordance with applicable U.S.

accounting effects of the loss of control, including the deconsolidation of HWH and the accounting for the Company’s retained interest,

will be recognized in the Company’s consolidated financial statements for the quarter ending September 30, 2026.

The Company is

currently evaluating the accounting effects of the transaction, and the amount of any resulting gain or loss has not yet been determined.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements