What changed in this filing

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Item 1. Financial Statements

2025-11-13 compared with 2025-05-14 · 613 added, 509 removed, 440 unchanged (72% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2025 AND JUNE 30, 2024

AS OF SEPTEMBER 30, 2025 AND JUNE 30, 2025

(US$, except share data, or otherwise noted)

September 30,

Current assets

Accounts receivable and other receivable, net

Cash and cash equivalents

Accounts receivable and other receivable, net of credit loss allowance of $ 594,869 and $ 594,869

Other current assets

Prepaid expenses

Loan receivables

Loan receivables, net of credit loss allowance of $ nil and $ nil

Total current assets

Non-current assets

Restricted cash

Restricted cash – non-current

Long-term loan receivables

8 unchanged sentences

Contract liabilities

Income taxes payable

Due to related parties

Accrued payroll liabilities

6 unchanged sentences

Finance lease liabilities – non-current

Deferred income tax liabilities

Total liabilities

1 unchanged sentence

Stockholders’ equity

Common stock, US$ 0.00001 par value, 100,000,000 shares authorized, 42,112,026 and 41,634,000 issued and outstanding as of March 31, 2025 and June 30, 2024, respectively

Common stock, US$ 0.00001 par value, 100,000,000 shares authorized, 45,443,079 and 42,250,934 issued and outstanding as of September 30, 2025 and June 30, 2025, respectively

Additional paid-in capital

6 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS

OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2025 AND 2024

OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

(US$, except share data, or otherwise noted)

Costs of sales

Gross profit (loss)

September 30,

Costs of services

( 2,484,083 )

( 3,606,790 )

Operating costs and expenses:

1 unchanged sentence

Total operating costs and expenses

Income (loss) from operations

Loss from operations

( 6,701,389 )

3 unchanged sentences

( 1,205,665 )

( 1,902,813 )

Loss on disposal of assets

Finance costs

1 unchanged sentence

( 1,196,657 )

( 1,865,034 )

Income (loss) before provision for income taxes

Loss before provision for income taxes

( 6,511,142 )

( 6,078,958 )

Current income tax expense

Deferred income tax (recovery) expense

Current income tax recovery

Deferred income tax recovery

( 1,373,498 )

Total income tax (recovery) expenses

Total income tax recovery

( 1,431,087 )

Net income (loss)

( 6,508,053 )

( 4,647,871 )

Total comprehensive income (loss)

Total comprehensive loss

( 6,508,053 )

( 4,647,871 )

Basic & diluted net (loss) earnings per share

Basic & diluted net loss per share

Weighted average number of shares of common stock-basic and diluted

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKOLDERS’ EQUITY

FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2025 AND 2024

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

(US$, except share data, or otherwise noted)

Nine Months Ended

Balance as of June 30, 2023

Contribution from stockholders

Balance as of March 31, 2024 (unaudited)

stockholders’

Three Months Ended

Balance as of December 31, 2023 (unaudited)

Contribution from stockholders

Balance as of March 31, 2024 (unaudited)

Nine Months Ended

Balance as of June 30, 2024

1 unchanged sentence

( 4,647,871 )

Shares issued pursuant to Standby Equity Purchase Agreement (SEPA)

Issuance of common stock for commitment fee

Balance as of March 31, 2025 (unaudited)

Three Months ended

Balance as of December 31, 2024 (unaudited)

Balance as of September 30, 2024 (unaudited)

Balance as of June 30, 2025

( 6,508,053 )

Shares issued pursuant to SEPA

Balance as of March 31, 2025 (unaudited)

Shares issued for Investor Notices pursuant to Standby Equity Purchase Agreement

Balance as of September 30, 2025 (unaudited)

The accompanying notes form an integral part

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED MARCH 31, 2025 AND 2024 (UNAUDITED)

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024 (UNAUDITED)

(US$, except share data, or otherwise noted)

Three Months Ended

September 30,

Three Months Ended

September 30,

Cash Flows from Operating Activities:

Net (loss) income

( 6,508,053 )

Net loss from disposal of fixed assets

( 4,647,871 )

Adjustments for items not affecting cash:

Depreciation of property and equipment and right-of-use financial assets

Non-cash operating leases expense

Gain from settlement of commitment payable

Accretion of convertible note

Current estimated credit loss

Accretion of convertible notes

Deferred income taxes

1 unchanged sentence

Interest income

Changes in working capital:

Changes in operating assets and liabilities

Accounts receivable and other receivables

( 1,606,810 )

( 7,685,423 )

Other current assets

3 unchanged sentences

( 1,574,944 )

( 1,927,718 )

Contract liabilities

1 unchanged sentence

Accrued payroll liabilities

Net changes in derecognized ROU and operating lease liabilities

Net cash (used in) provided from operating activities

Net cash used in operating activities

( 1,929,402 )

( 3,612,112 )

Cash Flows from Investing Activities:

1 unchanged sentence

( 1,353,297 )

Loan disbursements

( 2,370,000 )

Loan disbursement

( 1,000,000 )

Proceeds from loan repayments

Net cash provided by (used in) investing activities

( 1,316,592 )

Proceeds from repayment of loan receivables

Proceeds from sale of property and equipment

Net cash used in investing activities

Cash Flows from Financing Activities:

Repayments of finance lease liabilities

Repayments of convertible notes

( 2,020,000 )

Net cash used in financing activities

( 2,117,747 )

Cash Flows from Financing Activities:

Proceeds received from related parties

Deferred issuance costs for initial public offering

Repayment to related parties

Net proceeds from SEPA

Repayment of commitment payable

Repayment of finance lease liabilities

Repayment of SEPA

Capital contributions from stockholders

Net cash provided by financing activities

Net decrease in cash and restricted cash

Cash and restricted cash, beginning of year

Cash and restricted cash, end of nine months periods

The following table provides a reconciliation of cash and restricted cash reported within the Consolidated Balance Sheets that equal the totals of the same amounts shown in the Consolidated Statements of Cash Flows:

Net decrease in cash and cash equivalents and restricted cash

( 2,729,917 )

( 4,964,535 )

Cash and cash equivalents and restricted cash, beginning of the period

Cash and cash equivalents and restricted cash, end of the period

The following table provides a reconciliation of cash

and cash equivalents and restricted cash reported within the Consolidated Balance Sheets that sum to the total of the same amounts

shown in the Consolidated Statements of Cash Flows:

Cash and cash equivalents

Restricted cash – non-current

Total cash and restricted cash shown in the Consolidated Balance Sheet

Total cash and cash equivalents and restricted

cash shown in the Condensed Consolidated Balance Sheets

Supplemental Disclosure of Cash Flows Information:

Cash paid for income tax

Cash paid for interest

Non-cash Transactions:

Right-of-use assets acquired in exchange for operating lease liabilities

Decrease in right-of-use assets due to remeasurement of lease terms

Shares issued to settle commitment fee

IPO expenses paid by stockholders

Shares issued pursuant to SEPA

Right-of-use assets acquired in exchange for finance lease

Shares issued for Investor Notices pursuant to SEPA by reducing the convertible notes

The accompanying notes form an integral part

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The Company’s primary transportation services

involve arranging shipments, on behalf of its customers, of materials that are generally larger than shipments handled by integrated carriers

of primarily small parcels, such as FedEx, and UPS, including arranging and monitoring all aspects of material flow activity utilizing

advanced information technology systems.

The Company also provides other value-added logistics services, including warehousing services,

materials management and distribution services, and customs house brokerage services, to complement its core transportation service offering.

involve arranging shipments, on behalf of its customers, of materials that are generally larger than shipments handled by integrated

carriers of primarily small parcels, such as FedEx, and UPS, including arranging and monitoring all aspects of material flow activity

utilizing advanced information technology systems.

The Company also provides other value-added logistics services, including warehousing

services, materials management and distribution services, and customs house brokerage services, to complement its core transportation

service offering.

Summary of significant accounting policies

Basis of presentation

The accompanying unaudited interim condensed consolidated

financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)

for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC.

information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or

omitted, pursuant to the rules and regulations of the SEC for interim financial reporting.

Accordingly, they do not include all the information

and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows.

The accompanying unaudited

condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included

in the Company’s annual report on Form 10-K for the year ended June 30, 2024.

The accompanying unaudited interim condensed

consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States

of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8

of Regulation S-X of the SEC.

Certain information or footnote disclosures normally included in financial statements prepared in accordance

with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting.

they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations,

or cash flows.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited

consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended June 30, 2025.

In the opinion of the Company’s management,

the unaudited interim condensed consolidated financial statements include all adjustments, which are only of a normal and recurring nature,

necessary for a fair statement of the financial position of the Company as of March 31, 2025, and its results of operations and cash flows

for the nine-month period then ended.

Operating results for the three and nine months ended March 31, 2025 are not necessarily indicative

necessary for a fair statement of the financial position of the Company as of September 30, 2025, and its results of operations and cash

flows for the three-month period then ended.

Operating results for the three months ended September 30, 2025 are not necessarily indicative

of the results that may be expected for the fiscal year ended June 30, 2026.

Going Concern

These financial statements have been

prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities

in the normal course of business.

The Company incurred a net loss of $ 6.5 million during the three months ended September 30, 2025

and as of that date, had a net current liability of $ 11.1 million.

Without additional financing, the Company may not be able to fund

its ongoing operations.

The Company is expanding its service offerings to new customers, optimizing warehouse utilization, and

developing higher-margin logistics solutions to improve profitability and cash generation.

Management is executing a cost

optimization plan, including delaying certain non-essential capital expenditures, reducing third-party service costs, and improving

operational efficiency across warehouse operations to preserve cash flow.

In addition, the Company is in discussions with several

financial institutions and investors to secure additional credit facilities and other forms of financing to strengthen working

There is no assurance that the Company will be able to obtain financings or obtain them on favorable terms.

uncertainties may cast significant doubt on the Company’s ability to continue as a going concern.

The Company will need to

raise sufficient working capital to maintain operations.

These financial statements do not include any adjustments related to the

recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a

going concern.

Such adjustments could be material.

Principal of consolidation

The unaudited interim condensed consolidated financial

statements include the financial statements of the Company and its subsidiaries.

All transactions and balances among the Company

and its subsidiaries have been eliminated upon consolidation.

The unaudited interim condensed consolidated

financial statements include the financial statements of the Company and its subsidiaries.

All transactions and balances among

the Company and its subsidiaries have been eliminated upon consolidation.

Principal activities Percentage of

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Armlogi Group LLC Leasing services 100 % October 19, 2021 California, U.S.

Use of Estimates

The preparation of financial statements and related

disclosures in accordance with accounting principles generally accepted in the United States (‘U.S.

GAAP”) requires management

to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities

at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.

There were no critical

accounting estimates affecting the unaudited condensed consolidated financial statements for the three and nine months ended March

31, 2025 and 2024.

HOLDING CORP.

ARMLOGI HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Cash consists of petty cash on hand and cash held

in banks, which is highly liquid and has original maturities of three months or less and is unrestricted as to withdrawal or use.

Use of Estimates

The preparation of financial statements and

related disclosures in accordance with accounting principles generally accepted in the United States (‘U.S.

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of

contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during

the reporting period.

Significant accounting estimates required to be made by management include useful lives of property and

equipment, allowance for credit losses for accounts receivable and other receivables, and loan receivables.

Cash and cash equivalents

Cash and cash equivalents consists of petty cash

on hand and cash held in banks and other financial institutions, which is highly liquid and has original maturities of three months

or less and is unrestricted as to withdrawal or use.

Restricted Cash

Restricted cash represents the cash restricted

for five standby letters of credit with Eastwest Bank as collateral for certain of the Company’s lease agreements.

the letters of credit start from August 1, 2023, November 7, 2023, December 27, 2024, January 14, 2025, and March 20, 2025, respectively.

for six standby letters of credit with Eastwest Bank as collateral for certain of the Company’s lease agreements.

the letters of credit start from April 26, 2023, August 1, 2023, November 7, 2023, December 27, 2024, January 14, 2025, and March 20,

2025, respectively.

The letters of credit are renewable on an annual basis until the termination thereof.

Certain risks and concentration

The Company’s financial instruments that

potentially subject the Company to significant concentrations of credit risk consist primarily of cash and restricted cash, receivables,

loan receivables and other current assets.

As of March 31, 2025 and June 30, 2024, substantially all of the Company’s cash and restricted

cash were held in Eastwest Bank located in the U.S., which management considers to be of high credit quality.

The Company’s financial instruments

that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and restricted cash,

receivables, loan receivables, other current assets, and other non-current assets.

As of September 30, 2025 and June 30, 2025,

substantially all of the Company’s cash and cash equivalents and restricted cash were held in EastWest Bank located in

the U.S., which management considers to be of high credit quality.

As of September 30, 2025 and June 30, 2025, the

largest three accounts receivable balances from customers accounted for 44 % and 66 % of the total balance of accounts receivable, respectively.

Accounts receivable and other receivables

The Company’s receivables are recorded when

billed and represent amounts owed by third-party customers.

The Company’s receivables are recorded

when billed and represent amounts owed by third-party customers.

The carrying value of the Company’s receivables, net of the expected

2 unchanged sentences

other receivables on a loss rate method based on historical information adjusted for current conditions and future estimated economic

The Company’s credit term generally ranges from 3 to 30 days.

If there is an approval from the board of the Company,

the credit term can extend to 180 days.

Loans receivables

Loan receivables are carried at amortized cost,

net of an allowance for credit losses, in accordance with ASC 326, Financial Instruments – Credit Losses (CECL) .

ARMLOGI HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Loans receivables (cont.)

Management estimates expected credit losses over

the contractual term of the loans, adjusted for expected prepayments, using relevant available information.

This includes:

historical loss experience for similar loan portfolios;

current conditions, such as borrower financial performance and collateral

reasonable and supportable forecasts about future economic conditions

(e.g., industry trends, customer sector risks, interest rates, and market trends).

The estimate of expected credit losses is measured

on a collective (pool) basis when loans share similar risk characteristics (e.g., credit rating, or collateral).

Loans that do not share

risk characteristics with others are evaluated individually.

Property and equipment

Property and equipment are recorded at cost, less

accumulated depreciation and impairment.

Property and equipment are recorded at cost,

less accumulated depreciation and impairment.

Depreciation of property and equipment is calculated on a straight-line basis, after consideration

7 unchanged sentences

Leasehold improvements Straight-line Shorter of lease term or 15 years

Expenditures for maintenance and repairs are expensed

Gains and losses on disposals are the differences between net sales proceeds and carrying amounts of the relevant assets

and are recognized in the unaudited condensed consolidated statements of operations and comprehensive income (loss).

Expenditures for maintenance and repairs are

expensed as incurred.

Gains and losses on disposals are the differences between net sales proceeds and carrying amounts of the relevant

assets and are recognized in the unaudited condensed consolidated statements of operations and comprehensive loss.

Long-Lived Assets

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or changes in circumstances indicate the carrying amount of the assets may not be recoverable.

If circumstances require a long-lived asset

or asset group to be tested for possible impairment, the Company compares the undiscounted expected future cash flows to be generated

If circumstances require a long-lived

asset or asset group to be tested for possible impairment, the Company compares the undiscounted expected future cash flows to be generated

by that asset or asset group to its carrying amount.

If the carrying amount of the long-lived asset or asset group is not recoverable

on an undiscounted cash flow basis, an impairment charge is recognized to the extent the carrying amount of the asset or asset group exceeds

the fair value.

Fair values of long-lived assets are determined through various techniques, such as applying probability weighted, expected

present value calculations to the estimated future cash flows using assumptions a market participant would utilize or through the use

of a third-party independent appraiser or valuation specialist.

No impairment losses of long-lived assets were recorded during the three

and nine months ended March 31, 2025 and 2024.

on an undiscounted cash flow basis, an impairment charge is recognized to the extent the carrying amount of the asset or asset group

exceeds the fair value.

Fair values of long-lived assets are determined through various techniques, such as applying probability weighted,

expected present value calculations to the estimated future cash flows using assumptions a market participant would utilize or through

the use of a third-party independent appraiser or valuation specialist.

No impairment losses of long-lived assets were recorded during

the three months ended September 30, 2025 and 2024.

Intangible assets consist of software and security

7 unchanged sentences

generates its transportation services revenue by purchasing transportation from direct carriers and reselling those services to its customers.

In general, each shipment transaction or service

order constitutes a separate contract with the customer.

A performance obligation is created once a customer agreement with an agreed-upon

transaction price exists.

The transaction price is typically fixed and not contingent upon the occurrence or non-occurrence of any other

The Company’s transportation transactions provide for the arrangement of the movement of freight to a customer’s destination.

The transportation services that are provided to the customer, including certain ancillary services, such as loading/unloading, freight

insurance, and customs clearance, represent a single performance obligation, as these promises are not distinct in the context of the

This performance obligation is satisfied over time and recognized in revenue upon the transfer of control of the services over

the requisite transit period as the customer’s goods move from origin to destination.

The Company determines the period to recognize

revenue in transit based on the departure date and the delivery date.

Determination of the transit period and the percentage of completion

of the shipment as of the reporting date will affect the timing of revenue recognition.

The Company has determined that revenue recognition

over the transit period provides a reasonable estimate of the transfer of services to its customers as it depicts the pattern of the Company’s

In general, each shipment transaction or

service order constitutes a separate contract with the customer.

A performance obligation is created once a customer agreement with

an agreed-upon transaction price exists.

The transaction price is typically fixed and not contingent upon the occurrence or

non-occurrence of any other event.

The Company’s transportation transactions provide for the arrangement of the movement of

freight to a customer’s destination.

The transportation services that are provided to the customer, including certain

ancillary services, such as loading/unloading, freight insurance, and customs clearance, represent a single performance obligation,

as these promises are not distinct in the context of the contract.

This performance obligation is satisfied over time and recognized

in revenue upon the transfer of control of the services over the requisite transit period as the customer’s goods move from

origin to destination.

The Company determines the period to recognize revenue in transit based on the departure date and the

delivery date.

Determination of the transit period and the percentage of completion of the shipment as of the reporting date will

affect the timing of revenue recognition.

The Company has determined that revenue recognition based on the time in transit provides a reasonable estimate of the transfer of services to its customers as it depicts the pattern of the Company’s

performance under the contracts with its customers.

The change in contract liabilities is due to the timing of customer deposits for orders,

offset by customer deposits recognized as revenue during the period.

The Company expects to recognize revenue for any performance obligations

within a twelve-month period and have elected not to provide disclosures regarding remaining performance obligations for contracts with

a term of one year or less.

The change in contract liabilities is due to the timing of customer deposits for

orders, offset by customer deposits recognized as revenue during the period.

The Company expects to recognize revenue for any

performance obligations within a twelve-month period and have elected not to provide disclosures regarding remaining performance

obligations for contracts with a term of one year or less.

The Company also provides warehousing services

3 unchanged sentences

and ii) storage services.

The Company’s performance obligation for inventory management and order fulfilment is satisfied at a point

in time as services are generally priced based on the number of items processed and handled.

The Company’s performance obligation for inventory management and order fulfilment is satisfied at a

point in time as services are generally priced based on the number of items processed and handled.

The benefits are consumed by the customers

2 unchanged sentences

one day to process.

The performance obligation for storage services is satisfied over time as the storage service is based on a term

period and the customers simultaneously receive and consume the services provided by the Company as they are performed.

The performance obligation for storage services is satisfied over time as the storage service is based on a

term period and the customers simultaneously receive and consume the services provided by the Company as they are performed.

The transaction

1 unchanged sentence

consideration.

In general, the fixed consideration component of a contract represents reimbursement for facility and equipment costs incurred

to satisfy the performance obligation and is recognized on a straight-line basis over the term of the contract.

The variable consideration

component is comprised of cost reimbursement per unit pricing for time and pricing for materials used and is determined based on cost

plus a mark-up for hours of services provided and materials used and is recognized based on the level of activity volume.

In general, the fixed consideration component of a contract represents reimbursement for facility and equipment costs

incurred to satisfy the performance obligation and is recognized on a straight-line basis over the term of the contract.

consideration component is comprised of cost reimbursement per unit pricing for time and pricing for materials used and is determined

based on cost plus a mark-up for hours of services provided and materials used and is recognized based on the level of activity

Other services include primarily customs house

2 unchanged sentences

obligation at a point in time, which is the completion of the services.

Duties and taxes collected from the customer and paid to the customs

agent on behalf of the customers are excluded from revenue.

The Company uses independent contractors and third-party

carriers in the performance of its transportation services.

The Company evaluates who controls the transportation services to determine

whether its performance obligation is to transfer services to the customer or to arrange for services to be provided by another party.

The Company determined it acts as the principal for its transportation services performance obligation, since it is in control of establishing

the prices for the specified services, managing all aspects of the shipment process, and assuming the risk of loss for delivery and collection.

Such transportation services revenue is presented on a gross basis in the unaudited condensed consolidated statements of operations and

comprehensive income (loss).

Duties and taxes collected from the customer and paid to the

customs agent on behalf of the customers are excluded from revenue.

ASC 606, Revenue from Contracts with Customers,

provides for a five-step model for recognizing revenue from contracts with customers.

These five steps include:

Identify the contract with the customer

Identify the performance obligations in the contract

Determine the transaction price

Allocate the transaction price to the performance obligations

in the contract

Recognize revenue when the Company satisfies a performance

Under ASC 606, revenue is recognized when the

customer obtains control of a good or service.

The Company uses independent contractors and third-party carriers in the performance of

its transportation services.

The Company evaluates who controls the transportation services to determine whether its performance obligation

is to transfer services to the customer or to arrange for services to be provided by another party.

The Company determined it acts as

the principal for its transportation services performance obligation since it is in control of establishing the prices for the specified

services, managing all aspects of the shipment process, and assuming the risk of loss for delivery and collection.

Such transportation

services revenue is presented on a gross basis in the unaudited condensed consolidated statements of operations and comprehensive loss.

HOLDING CORP.

4 unchanged sentences

by major service lines is as follows:

Three Months Ended

September 30,

Three Months Ended

September 30,

Transportation services

8 unchanged sentences

expects to satisfy these obligations within its normal operating cycle, which is generally one year.

For the nine months ended March 31,

2025 and 2024, the amounts transferred from contract liabilities at the beginning of the fiscal year to revenue were US$ 276,463 and US$ 424,182 ,

For the three months ended September

30, 2025 and 2024, the amounts transferred from contract liabilities at the beginning of the fiscal year to revenue were $ 862,145 and

$ 276,463 , respectively.

7 unchanged sentences

The Company also applies the practical expedient

that permits the recognition of employee sales commissions related to transportation services as an expense when incurred, since the amortization

period of such costs is less than one year.

These costs are included in the unaudited condensed consolidated statements of operations

and comprehensive income (loss).

that permits the recognition of employee sales commissions related to transportation services as an expense when incurred, since the

amortization period of such costs is less than one year.

These costs are included in the unaudited condensed consolidated statements

of operations and comprehensive loss.

The Company determines if an arrangement is a

11 unchanged sentences

recognizes those lease payments on a straight-line basis over the lease term.

ROU assets represent the right to use an underlying

asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease.

Operating lease

ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term.

most of the Company’s leases do not provide an implicit rate, management uses the incremental borrowing rate based on the information

available at the commencement date in determining the present value of lease payments.

Management uses the implicit rate when readily

determinable.

Lease expenses for lease payments are recognized on a straight-line basis over the lease term and are included in general

and administrative expenses, costs of sales and other expenses.

ROU assets represent the right to use an underlying asset for the lease

term and lease liabilities represent the obligation to make lease payments arising from the lease.

Operating lease ROU assets and liabilities

are recognized at the commencement date based on the present value of lease payments over the lease term.

As most of the Company’s

leases do not provide an implicit rate, management uses the incremental borrowing rate based on the information available at the commencement

date in determining the present value of lease payments.

Management uses the implicit rate when readily determinable.

Lease expenses for

lease payments are recognized on a straight-line basis over the lease term and are included in general and administrative expenses, costs

of services and other expenses.

ii) Finance leases

Finance lease ROU assets are included in ROU and

current lease liabilities, and other non-current lease liabilities in the unaudited condensed consolidated balance sheets.

Finance lease ROU assets and liabilities are recognized

at the commencement date based on the present value of lease payments over the lease term.

As most of the Company’s leases do not

provide an implicit rate, management uses the incremental borrowing rate based on the information available at the commencement date in

determining the present value of lease payments.

Finance lease ROU assets are included in ROU

and current lease liabilities, and other non-current lease liabilities in the unaudited condensed consolidated balance sheets.

Finance lease ROU assets and liabilities are

recognized at the commencement date based on the present value of lease payments over the lease term.

As most of the Company’s

leases do not provide an implicit rate, management uses the incremental borrowing rate based on the information available at the commencement

date in determining the present value of lease payments.

Management uses the implicit rate when readily determinable.

Finance lease ROU assets

are generally amortized over the lease term and are included in depreciation expenses.

The interest on the finance lease liabilities is

included in interest expense.

Finance lease ROU

assets are generally amortized over the lease term and are included in depreciation expenses.

The interest on the finance lease liabilities

is included in interest expense.

The Company has elected the accounting policy

4 unchanged sentences

Current income taxes are provided on the basis

of net profit or loss for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for

income tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

of net profit or loss for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible

for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

Deferred income taxes are recognized for temporary

differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, net operating

loss carry forwards and credits.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more

likely than not that some portion or all of the deferred tax assets will not be realized.

Current income taxes are provided in accordance

with the laws of the relevant taxing authorities.

Deferred tax assets and liabilities are measured using enacted rates expected to apply

to taxable income in which temporary differences are expected to be reversed or settled.

The effect on deferred tax assets and liabilities

of changes in tax rates is recognized in the statement of operations in the period of the enactment of the change.

differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements, net

operating loss carry forwards and credits.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management,

it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Current income taxes are provided

in accordance with the laws of the relevant taxing authorities.

Deferred tax assets and liabilities are measured using enacted rates

expected to apply to taxable income in which temporary differences are expected to be reversed or settled.

The effect on deferred tax

assets and liabilities of changes in tax rates is recognized in the statement of operations in the period of the enactment of the change.

HOLDING CORP.

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settlement with a taxing authority.

The Company’s liability associated with unrecognized tax benefits is adjusted periodically due

to changing circumstances, such as the progress of tax audits, case law developments and new or emerging legislation.

The Company’s liability associated with unrecognized tax benefits is adjusted periodically

due to changing circumstances, such as the progress of tax audits, case law developments and new or emerging legislation.

Such adjustments

4 unchanged sentences

The Company did not

have any unrecognized tax benefits as of March 31, 2025 and June 30, 2024.

have any unrecognized tax benefits as of September 30, 2025 and June 30, 2025.

Earnings per share

Basic earnings per share of common stock are computed

by dividing net income allocable to common stockholders by the weighted average number of shares of common stock outstanding.

earnings per share is computed by dividing net income allocable to common stockholders by the weighted average number of shares outstanding,

plus the number of additional shares that would have been outstanding if the potential shares, such as restricted stock awards and stock

options, had been issued and were considered dilutive.

Basic earnings per share of common stock are

computed by dividing net income allocable to common stockholders by the weighted average number of shares of common stock outstanding.

Diluted earnings per share is computed by dividing net income allocable to common stockholders by the weighted average number of shares

outstanding, plus the number of additional shares that would have been outstanding if the potential shares, such as restricted stock

awards and stock options, had been issued and were considered dilutive.

Segment Reporting

The Company follows FASB ASC Topic 280, Segment

Reporting, which requires that companies disclose segment data based on how management makes decisions about allocating resources to segments

and evaluating their performance.

Reportable operating segments include components of an entity about which separate financial information

is available and which operating results are regularly reviewed by the chief operating decision maker to make decisions about resources

to be allocated to the segment and assess each operating segment’s performance.

Based on the guidance provided by ASC Topic 280,

management has determined that the Company operates in one segment and consists of one reporting unit, given the similarities in economic

characteristics between its operations and the common nature of its services and customers.

All the Company’s business activities

for the three and nine months ended March 31, 2025 and 2024 were conducted in the U.S.

FASB ASC 280, Segment Reporting (“ASC 280”),

establishes standards for reporting information about operating segments.

Operating segments are defined as components of an enterprise

about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making

group, in deciding how to allocate resources and in assessing performance.

The Company’s chief operating decision maker (“CODM”),

the Chief Executive Officer, manages the Company’s business activities as a single operating and reportable segment at the consolidated

Accordingly, the CODM uses consolidated net income to measure segment profit or loss, allocate resources and assess performance.

Further, the CODM reviews and utilizes functional expenses (cost of services and general and administrative) at the consolidated level

to manage the Company’s operations.

Other segment items included in consolidated net income are other income, finance costs, income

taxes, and infrequent items such as loss on debt extinguishment and loss on disposal of assets, which are reflected in the consolidated

statements of operations.

All the Company’s business activities for

the three months ended September 30, 2025 and 2024 were conducted in the U.S.

Therefore, revenue for the three months ended

September 30, 2025 and 2024 were all from the U.S.

The Company’s long-lived assets consist

primarily of property and equipment, right-of-use assets and restricted cash.

As of September 30, 2025 and June 30, 2025, all of the

Company’s long-lived assets were in the U.S.

HOLDING CORP.

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from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers

the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when

pricing the asset or liability.

When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company

considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants

would use when pricing the asset or liability.

The established fair value hierarchy requires

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The three levels of inputs that may be used to measure fair value are as follows:

Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Observable, market-based inputs, other than quoted prices, in active markets for identical assets or liabilities.

Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

Quoted prices (unadjusted) in active markets for identical assets or

Observable, market-based inputs, other than quoted prices, in active

markets for identical assets or liabilities.

Unobservable inputs to the valuation methodology that are significant

to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments include

cash and restricted cash, accounts receivable and other receivables, loan receivables, long-term loan receivables, other current assets,

accounts payable and accrued liabilities, income tax payable, due to related parties, accrued payroll liabilities, commitment fee payable,

convertible notes and lease liabilities.

The carrying amounts of cash and restricted cash, accounts receivable and other receivables,

loan receivables, other current assets, accounts payable and accrued liabilities, due to related parties, accrued payroll liabilities,

commitment fee payable, convertible notes, and short-term lease liabilities approximate their fair values due to the short-term nature

of these instruments.

The carrying value of the Company’s long-term loan receivables and long-term lease liabilities would not differ

significantly from fair value (based on Level 2 inputs) if recalculated based on current interest rates.

cash and cash equivalents and restricted cash, accounts receivable and other receivables, loan receivables, long-term loan receivables, other current assets,

accounts payable and accrued liabilities, accrued payroll liabilities, and lease liabilities.

The carrying amounts of

cash and restricted cash, accounts receivable and other receivables, loan receivables, other current assets, accounts payable and accrued

liabilities, accrued payroll liabilities, and short-term lease liabilities approximate their fair values due to the

short-term nature of these instruments.

The carrying value of the Company’s long-term loan receivables and long-term lease liabilities

would not differ significantly from fair value (based on Level 2 inputs) if recalculated based on current interest rates.

The Company noted no transfers between levels

1 unchanged sentence

The Company did not have any instruments that were measured at fair value on a recurring or non-recurring

basis as of March 31, 2025 and June 30, 2024.

Costs of sales

Costs of sales primarily consist of amortization

and depreciation, equipment lease and warehouse lease expenses, freight expenses, port handling and customs fees, salary and benefits,

temporary labor expenses, warehouse expenses, utilities and other expenses.

basis as of September 30, 2025 and June 30, 2025.

Costs of services

Costs of services primarily consist of amortization and depreciation,

equipment lease and warehouse lease expenses, freight expenses, port handling and customs fees, salary and benefits, temporary labor expenses,

warehouse expenses, utilities and other expenses.

General and administrative expenses

General and administrative expenses primarily

consist of office equipment and furniture depreciation expenses, office expenses, professional fees, office space rental expenses, repairs

and maintenance, salary and benefits, sundry costs, vehicle expenses, tax and licenses, credit loss expenses, and other expenses.

consist of office expenses, professional fees, rental expenses, repairs and maintenance,

and salary and benefits

Recently issued accounting standards

Management does not believe that any recently

issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s unaudited

condensed consolidated financial statements.

In November 2023, the FASB issued ASU No.

Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

ASU 2023-07 is designed to improve the reportable segment

disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the

Company’s CODM.

The new standard is effective for the Company for its annual periods beginning January 1, 2024 and for interim

periods beginning January 1, 2025, with early adoption permitted.

The Company adopted ASU 2023-07 on January 1, 2024, which did not have

a material impact on the Company’s consolidated financial statements.

Management does not believe that any other recently

issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s consolidated

financial statements.

HOLDING CORP.

3 unchanged sentences

consisted of the following:

September 30,

Accounts receivable – third parties

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Other receivables – third parties*

Other receivables – a related party*

allowance for credit loss

balance is comprised primarily of accounts receivable associated with service arrangements that are not within the scope of ASC 606.

The movement of allowance for credit loss for

the nine months ended March 31, 2025 and the fiscal year ended June 30, 2024:

* The balance is comprised primarily of accounts receivable associated with service arrangements that are not within the scope of ASC 606.

The allowance for credit loss for the three months ended September 30,

2025 and the fiscal year ended June 30, 2025 consisted of the following:

September 30,

Balance as of beginning

4 unchanged sentences

Property and Equipment, Net

Property and equipment, net consisted of the following:

Property and equipment, net consisted of the

September 30,

Furniture and fixtures

6 unchanged sentences

Property and equipment, net

Depreciation expenses are recorded in costs of

sales and general and administrative expenses.

The Company recorded depreciation expenses of US$ 658,260 and US$ 525,167 during the three

months ended March 31, 2025 and 2024, respectively.

Specifically, US$ 609,189 and US$ 436,084 of the depreciation expenses were recorded

in costs of sales for the three months ended March 31, 2025 and 2024, respectively.

Depreciation expenses are recorded in costs of services and general

and administrative expenses.

The Company recorded depreciation expenses of US$ 682,244 and US$ 578,432 during the three months ended

September 30, 2025 and 2024, respectively.

Specifically, US$ 633,172 and US$ 436,368 of the depreciation expenses were recorded in costs

of services for the three months ended September 30, 2025 and 2024, respectively.

US$ 49,072 and US$ 142,064 of the depreciation expenses

were recorded in general and administrative expenses for the three months ended March 31, 2025 and 2024, respectively.

The Company recorded depreciation expenses of

US$ 1,874,681 and US$ 1,313,684 during the nine months ended March 31, 2025 and 2024, respectively.

Specifically, US$ 1,717,363 and US$ 1,091,795

of the depreciation expenses were recorded in costs of sales for the nine months ended March 31, 2025 and 2024, respectively, US$ 157,318

and US$ 221,889 of the depreciation expenses were recorded in general and administrative expenses for the nine months ended March 31, 2025

and 2024, respectively.

were recorded in general and administrative expenses for the three months ended September 30, 2025 and 2024, respectively.

Intangible Assets, Net

Intangible assets, net consisted of the following:

September 30,

Security Systems

1 unchanged sentence

Intangible assets, net

The Company recorded amortization of US$ 26,706

and US$ 26,488 , which were included in costs of sales, for the nine months ended March 31, 2025 and 2024, respectively.

The Company recorded

amortization of US$ 8,829 and US$ 8,829 , which were included in costs of sales, for the three months ended March 31, 2025 and 2024, respectively.

The Company recorded amortization of US$ 11,595 and US$ 8,829 , which

were included in costs of services, for the three months ended September 30, 2025 and 2024, respectively.

HOLDING CORP.

1 unchanged sentence

Loan Receivables

The Company’s loan receivables were consisted

The Company’s loan receivables consisted

of the following:

i) On July 10, 2023, the Company entered into a loan agreement with Pundarika LLC in the principal amount of US$ 1,000,000 .

The loan matured on August 31, 2024 and bore interest at a rate of 3.2 % annually.

The loan was fully repaid on August 30, 2024.

ii) On January 24, 2024, the Company entered into a loan agreement with Athena Home Inc.in the principal amount of US$ 600,000 .

The loan originally matured on January 24, 2025 and bears interest at a rate of 3.2 % annually.

The maturity date of the loan was extended to July 24, 2025 on April 18, 2025.

The Company expects the loan to be repaid upon maturity.

iii) On May 22, 2024, the Company entered into a loan agreement with MYJW LLC.

i) On January 24, 2024, the Company entered into a loan agreement with Athena Home Inc.

in the principal amount of US$ 600,000 .

The loan originally matured on January 24, 2025 and bore an interest rate of 3.2 % annually.

The maturity date of the loan was extended to April 24, 2025 on January 20, 2025, further extended to July 24, 2025 on April 18, 2025, and was further extended to January 24, 2026 on July 18, 2025.

ii) On May 21, 2024, the Company entered into a loan agreement with MYJW

in the principal amount of US$ 400,000 .

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects the loan to be repaid upon maturity.

iv) On May 28, 2024, the Company entered into a loan agreement with Pundarika LLC.

iii) On May 28, 2024, the Company entered into a loan agreement with Pundarika LLC.

in the principal amount of US$ 1.5 million.

As security for loan repayment, Pundarika LLC has pledged its inventory currently held in the Company’s warehouse as collateral.

The value of the collateralized inventory is equivalent to the outstanding loan amount, ensuring a 1:1 collateral coverage ratio.

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects the loan to be repaid upon maturity.

A partial payment of US$ 1 million was repaid by Pundarika LLC on November 14, 2024.

v) On June 6, 2024, the Company entered into a loan agreement with Pundarika LLC.

The loan was fully repaid on November 14, 2024, and September 19, 2025

with US$ 1.0 million and US$ 0.5 million, respectively.

iv) On June 6, 2024, the Company entered into a loan agreement with Pundarika LLC.

in the principal amount of US$ 1.0 million.

As security for loan repayment, Pundarika LLC has pledged its inventory currently held in the Company’s warehouse as collateral.

The value of the collateralized inventory is equivalent to the outstanding loan amount, ensuring a 1:1 collateral coverage ratio.

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects the loan to be repaid upon maturity.

vi) On June 13, 2024, the Company entered into a loan agreement with Bacalar Enterprise Freight Inc.

The loan was fully repaid during the three months ended September 30, 2025.

v) On June 13, 2024, the Company entered into a loan agreement with Bacalar

Enterprise Freight Inc.

in the principal amount of US$ 250,000 .

The loan matures on June 13, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects the loan to be repaid upon maturity.

vii) On August 29, 2024, the Company entered into a loan agreement with Pundarika LLC.

The loan originally matured on June 13, 2025 and bears interest at a rate

of 3.2 % annually.

The maturity date of the loan was extended to December 13, 2025 on June 10, 2025.

vi) On August 29, 2024, the Company entered into a loan agreement with Pundarika LLC.

in the principal amount of US$ 1.0 million.

As security for loan repayment, Pundarika LLC has pledged its inventory currently held in the Company’s warehouse as collateral.

The value of the collateralized inventory is equivalent to the outstanding loan amount, ensuring a 1:1 collateral coverage ratio.

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects the loan to be repaid upon maturity.

As of March 31, 2025, the Company recorded a loan

receivable balance of US$ 3,845,402 , including accrued interest income of US$ 95,402 .

The loan was fully repaid during the three months ended September 30, 2025.

vii) On August 7, 2025, the Company entered into a loan agreement with Leopard

Transnational Inc.

in the principal amount of US$ 200,000 .

The loan matures on August 7, 2026 and bears interest at a rate of 3.6 % annually.

A partial payment of US$ 50,000 was repaid by Leopard Transnational Inc.

on August 21, 2025.

The Company expects the loan to be repaid

upon maturity.

viii) On September 8, 2025, the Company entered into a loan agreement with Leopard Transnational Inc.

in the principal amount of US$ 250,000 .

The loan matures on September 8, 2026 and bears interest at a rate of 3.6 % annually.

ix) On September 9, 2025, the Company entered into a loan agreement with

Kimberly Tenneco Inc.

in the principal amount of US$ 820,000 .

As security for loan repayment, Kimberly Tenneco Inc.

has pledged its inventory

currently held in the Company’s warehouse as collateral.

The value of the collateralized inventory is equivalent to the outstanding

loan amount, ensuring a 1:1 collateral coverage ratio.

The loan matures on December 31, 2026 and bears interest at a rate of 5.0 % annually.

As of September 30, 2025, the Company recorded

a loan receivable balance of US$ 1,713,324 and long-term loan receivable of US$ 822,305 , including accrued interest income of US$ 65,629 .

As of June 30, 2025, the Company recorded a loan

receivable balance of US$ 1,877,131 and long-term loan receivable of US$ 2,908,636 , including accrued interest income of US$ 35,767 .

receivable balance of US$ 3,893,563 and long-term loan receivable of US$ Nil , including accrued interest income of US$ 143,563 .

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2025, the Company had operating

As of September 30, 2025, the Company had operating

and finance leases for office space, warehouse space, and forklifts.

Lease terms expire at various dates from September 2025 through November

Lease terms expire at various dates from October 2025 through November

2034 with options to renew for varying terms at the Company’s sole discretion.

2 unchanged sentences

Report, that these options will be exercised.

The Company had certain sublease contracts and recognized US$ 1,093,104 and US$ 2,133,436

lease income, recorded in other income, during the nine months ended March 31, 2025 and 2024, respectively.

During the nine months ended March 31, 2025, the

Company recognized additional operating lease liabilities of US$ 28,685,914 , as a result of entering into a new operating lease agreement.

The ROU assets were recognized at the discount rate range from 9.50 % to 10.00 %, resulting in US$ 28,685,914 on the commencement dates.

During the nine months ended March 31, 2025, the

Company terminated certain operating lease agreements prior to the original expiration dates.

As a result, the ROU assets and lease liabilities

were derecognized of US$ 1,861,834 and US$ 1,925,708 , respectively.

The Company had certain sublease contracts and recognized US$ 81,900 and US$ 727,498 lease

income, recorded in other income, during the three months ended September 30, 2025 and 2024, respectively.

During the three months ended September 30, 2025, the Company did not recognize any additional

operating lease liabilities.

The components of lease expenses were as follows:

three months ended

September 30,

three months ended

September 30,

Operating lease expenses

Amortization – included in costs of sales

Amortization – included in costs of services

Cash paid for amounts included in the measurement of liabilities:

Operating cash flows from operating leases

Financing cash flows from finance leases

Operating cash flows used in operating leases

Operating cash flows used in finance leases

Financing cash flows used in finance leases

Right-of-use assets obtained in exchange for lease liabilities:

1 unchanged sentence

Finance leases

The Company recorded operating lease expenses

of US$ 9,421,215 and US$ 7,892,313 in the three months ended March 31, 2025 and 2024, respectively.

Specifically, US$ 8,337,256 and US$ 7,282,718

of operating lease expenses were recorded in costs of sales for the three months ended March 31, 2025 and 2024, respectively.

US$ 1,083,959

and US$ 85,838 of operating lease expenses were recorded in general and administrative expenses for the three months ended March 31, 2025

and 2024, respectively.

Nil and US$ 523,757 of operating lease expenses were recorded in other expenses for the three months ended March

The Company recorded operating lease expenses of US$ 9,177,790 and US$ 8,111,425

during the three months ended September 30, 2025 and 2024, respectively.

Specifically, US$ 8,564,132 and US$ 7,621,771 of operating lease

expenses were recorded in costs of services for the three months ended September 30, 2025 and 2024, respectively.

US$ 613,658 and US$ 93,000

of operating lease expenses were recorded in general and administrative expenses for the three months ended September 30, 2025 and 2024,

respectively.

US$ Nil and US$ 396,654 of operating lease expenses were recorded in other expenses for the three months ended September 30,

2025 and 2024, respectively.

The Company recorded operating lease expenses

of US$ 25,279,522 and US$ 19,011,330 during the nine months ended March 31, 2025 and 2024, respectively.

Specifically, US$ 23,539,448 and

US$ 16,527,288 operating lease expenses were recorded in costs of sales for the nine months ended March 31, 2025 and 2024, respectively.

US$ 1,343,420 and US$ 1, 087,471 of operating lease expenses were recorded in general and administrative expenses for the nine months ended

March 31, 2025 and 2024, respectively.

US$ 396,654 and US$ 1,396,571 of operating lease expenses were recorded in other expenses for the

nine months ended March 31, 2025 and 2024, respectively.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Leases (cont.)

As of March 31, 2025, maturities of lease liabilities

for each of the following fiscal years ending June 30 and thereafter were as follows:

As of September 30, 2025, maturities of lease

liabilities for each of the following fiscal years ending June 30 and thereafter were as follows:

2030 and beyond

6 unchanged sentences

Non-current portion

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Leases (cont.)

Weighted average remaining lease term:

7 unchanged sentences

of the following:

September 30,

Accounts payable

1 unchanged sentence

Other liabilities

Other liabilities as of March 31, 2025 and June

30, 2024 mainly consisted of tenant’s deposit.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Other liabilities as of September 30, 2025 and

June 30, 2025 mainly consisted of tenant deposits.

Convertible notes

SEPA and Modification Agreement

On November 25, 2024, the Company entered into

a Standby Equity Purchase Agreement (the “SEPA”) with YA II PN, Ltd.

(the “Investor”), pursuant to which the

Company has the right to sell to the Investor up to $ 50.0 million (the “Commitment Amount”) of the Company’s common

stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA.

In connection

with the SEPA, and subject to the conditions set forth therein, the Investor agre ed

to advance to the Company pursuant to certain convertible promissory notes (the “Convertible Notes”) an aggregate principal

amount of up to $ 21.0 million (the “Pre-Paid Advance”), subject to a 10 % original issue discount, to be disbursed to the

Company in three tranches:

● The first Pre-Paid Advance was disbursed on November 25, 2024, in the amount of $ 5.0 million and the Company received $ 4.5 million in cash, net of the 10 % original issue discount.

● The second Pre-Paid Advance was disbursed on December 17, 2024, in the amount of $ 5.0 million and the Company received $ 4.5 million in cash, net of the 10 % original issue discount.

● The third Pre-Paid Advance, originally expected to be advanced in the principal amount of $ 11.0 million on the second trading day after the initial Registration Statement (as defined in the SEPA) first became effective, is no longer expected to be disbursed, since the initial Registration Statement did not become effective within 75 calendar days of the date of the registration rights agreement entered into between the Company and the Investor in connection with the SEPA, which was a condition precedent to such advance.

to th e SEPA, the Company, at its sole discretion, has the right, but not the obligation, to issue and sell to the Investor, and

the Investor will subscribe for and purchase the Company’s common stock by the delivery to the Investor of Advance Notices (as

defined in the SEPA).

In addition, the Investor, at its sole discretion has the right, but not the obligation, by the delivery to the

Company of Investor Notices, to cause an Advance Notice to be deemed delivered to the Investor and the issuance and sale of the Company’s

common stock to the Investor as long as there is a balance outstanding under a Convertible Note.

On November 25, 2024, the Company entered into a Standby Equity Purchase

Agreement (the “SEPA”) with YA II PN, Ltd.

(the “Investor”), pursuant to which the Company had the right to sell

to the Investor up to $ 50.0 million (the “Commitment Amount”) of shares of the Company’s common stock, subject to certain

limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA.

In connection with the SEPA, and subject

to the conditions set forth therein, the Investor agreed to advance to the Company pursuant to certain convertible promissory notes (the

“Convertible Notes”) an aggregate principal amount of up to $ 21.0 million (the “Pre-Paid Advance”), subject to

a 10 % original issue discount, to be disbursed to the Company in three tranches:

● The first Pre-Paid Advance was disbursed on November 25, 2024 (Promissory Note 1), in the amount of $ 5.0 million and the Company received $ 4.5 million in cash, net of the 10 % original issue discount.

● The second Pre-Paid Advance was disbursed on December 17, 2024 (Promissory Note 2), in the amount of $ 5.0 million and the Company received $ 4.5 million in cash, net of the 10 % original issue discount.

● The third Pre-Paid Advance, originally expected to be advanced in the

principal amount of $ 11.0 million on the second trading day after the initial Registration Statement (as defined in the SEPA) first became

effective, may no longer be disbursed, since the initial Registration Statement did not become effective within 75 calendar days of the

date of the registration rights agreement entered into between the Company and the Investor in connection with the SEPA, which was a

condition precedent to such advance.

According to the SEPA, the Company, at its sole discretion, had the right, but not the obligation,

to issue and sell to the Investor, and the Investor was bound to subscribe for and purchase the Company’s common stock by the delivery

to the Investor of Advance Notices (as defined in the SEPA).

In addition, the Investor, at its sole discretion, has the right, but not

the obligation, by the delivery to the Company of Investor Notices, to cause an Advance Notice to be deemed delivered to the Investor

and the issuance and sale of shares of the Company’s common stock to the Investor as long as a balance was outstanding under a Convertible

ARMLOGI HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Convertible notes (cont.)

The Company agreed to pay a commitment fee of

5 unchanged sentences

The number of shares of common stock was determined by dividing one-half of the Commitment Fee

by the average of the daily volume-weighted average price (“VWAP”) of the Company’s common shares during the three trading

days immediately preceding November 25, 2024.

by the average of the daily volume-weighted average price (“VWAP”) of the Company’s common shares during the three

trading days immediately preceding November 25, 2024.

The remaining one-half of the Commitment Fee, amounting to $ 250,000 (the “Deferred

1 unchanged sentence

election, by way of a Pre-paid Advance.

Pursuant to a modification agreement (the “Modification Agreement”) entered into by

and between the Company and the Investor, the Company agreed to pay to the Investor a reduced amount of $ 150,000 in cash on March 24,

Pursuant to a modification agreement (the “Modification Agreement”) entered into

by and between the Company and the Investor, the Company agreed to pay to the Investor a reduced amount of $ 150,000 in cash on March

24, 2025, and the Investor agreed to accept such reduced amount in full satisfaction of the Deferred Fee.

Pursuant to the Modification Agreement, the Company

also agreed to make, cash payments on the dates and in the minimum amounts under the promissory notes in the aggregate, as set forth below.

The Company may, at its option, make cash payments in excess of the minimum amounts set forth below.

Such payments shall be applied to

the reduction of the original principal amount of the convertible promissory note dated November 25, 2025 first.

March 24, 2025 (paid)

During the week of March 31, 2025 (paid)

During the week of April 7, 2025 (paid)

During the week of April 14, 2025 (paid)

During the week of April 21, 2025 (paid)

During the week of April 28, 2025 (paid)

During the week of May 5, 2025 (paid)

During the week of May 12, 2025

During the week of May 19, 2025

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Convertible notes (cont.)

As of March 31, 2025, the Company had paid the

minimum payment of $ 850,000 and the remaining commitment fee payable of $ 250,000 , resulting in a gain in settlement amounting to $ 100,000 .

Unless earlier terminated as provided thereunder,

the SEPA shall terminate automatically on the earliest of (i) November 25, 2026, provided that if any Convertible Notes are then outstanding,

such termination shall be delayed until such date that all Convertible Notes that were outstanding have been repaid, or (ii) the date

on which the Investor has made payment of Pre-paid Advances pursuant to SEPA for common shares equal to the $ 50,000,000 .

Unless earlier terminated as provided thereunder, the SEPA was automatically

terminable on the earliest of (i) November 25, 2026, provided that if any Convertible Notes then outstanding, such termination shall be

delayed until such date that all Convertible Notes that were outstanding have been repaid, or (ii) the date on which the Investor has

made payment of Pre-paid Advances pursuant to SEPA for shares of common stock equal to $ 50,000,000 .

Advance Notice

If the Company requests a purchase of common stock

from the Investor by the delivery of an Advance Notice to the Investor, the purchase price therefor shall be the price per share of common

stock obtained by multiplying the market price by (i) 95 % in respect of an Advance Notice within an Option 1 Pricing Period (as defined

If the Company requested a purchase of shares of common stock from

the Investor by the delivery of an Advance Notice to the Investor, the purchase price therefor was the price per share of common stock

obtained by multiplying the market price by (i) 95 % in respect of an Advance Notice within an Option 1 Pricing Period (as defined

below) or (ii) 97 % in respect of an Advance Notice with an Option 2 Pricing Period (as defined below).

The “Option 1 Pricing Period” means

the period on the applicable advance notice date with respect to an Advance Notice selecting an Option 1 Pricing Period commencing (i)

if submitted to Investor prior to 9:00 a.m.

Eastern Time on a trading day, the open of trading on such day or (ii) if submitted to Investor

after 9:00 a.m.

Eastern Time on a trading day, upon receipt by the Company of written confirmation (which may be by e-mail) of acceptance

of such Advance Notice by the Investor (or the open of regular trading hours, if later), and which confirmation shall specify such commencement

time, and, in either case, ending on 4:00 p.m.

New York City time on the applicable Advance Notice date, or such other time as maybe agreed

by the parties.

The “Option 1 market price” means the VWAP of the common stock during the Option 1 Pricing Period.

The “Option 1 Pricing Period” means the period on the applicable

advance notice date with respect to an Advance Notice selecting an Option 1 Pricing Period commencing (i) if submitted to Investor prior

Eastern Time on a trading day, the open of trading on such day or (ii) if submitted to Investor after 9:00 a.m.

on a trading day, upon receipt by the Company of written confirmation of acceptance of such Advance Notice by the Investor (or the open

of regular trading hours, if later), and which confirmation specified such commencement time, and, in either case, ending on 4:00 p.m.

New York City time on the applicable Advance Notice date, or such other time as agreed to by the parties.

The “Option 1 market price”

means the VWAP of the common stock during the Option 1 Pricing Period.

The “Option 2 Pricing Period” means

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Investor Notice

If the Investor requests a sale from the Company

by the delivery of an Investor Notice to the Company, the purchase price, as of any conversion date or other date of determination, will

be the lower of (i) $ 7.5937 per share of common stock, or (ii) 94 % of the lowest daily VWAP during the 5 consecutive trading days immediately

preceding the conversion date or other date of determination (the “Variable Price”), which Variable Price shall not be lower

than the floor price ($ 1.1880 ) (the “Floor Price”) then in effect.

If the Investor requested a sale from the Company by the delivery of

an Investor Notice to the Company, the purchase price, as of any conversion date or other date of determination, was be the lower of (i)

$ 7.5937 per share of common stock, or (ii) 94 % of the lowest daily VWAP during the 5 consecutive trading days immediately preceding

the conversion date or other date of determination (the “Variable Price”), which Variable Price was no lower than the floor

price ($ 1.1880 ) (the “Floor Price”) then in effect.

In March 2025, the Company issued 434,879 shares

of common stock, par value of US$ 0.00001 per share, at a price of US$ 1.72 per share, for an aggregate amount of US$ 750,000 ,

representing the conversion of the SEPA loan for Investor Notices pursuant to the SEPA.

In May 2025, the Company issued 138,908 shares

of common stock, par value of US$ 0.00001 per share, at a price of US$ 1.4398 per share, for an aggregate amount of US$ 200,000 , representing

the conversion of the SEPA loan for Investor Notices pursuant to the SEPA.

In September 2025, the Company issued 77,669

and 3,114,476 shares of common stock, par value of US$ 0.00001 per share, at a price of US$ 1.29 and US$ 1.19 per share, respectively, for

an aggregate amount of US$ 3,800,000 , for Investor Notices pursuant to the SEPA.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Convertible notes (cont.)

Repayments of Convertible Notes

Interest accrues on the outstanding principal

balance of the Convertible Notes at an annual rate equal to 0 % (“Interest Rate”), which Interest Rate shall increase to an

annual rate of 18 % upon the occurrence of an event of default (for so long as such event remains uncured).

Interest accrued on the outstanding principal balance of the Convertible

Notes at an annual rate equal to 0 % (“Interest Rate”), which Interest Rate would increase to an annual rate of 18 %

upon the occurrence of an event of default (for so long as such event remains uncured).

If, any time after the issuance date of a Convertible

2 unchanged sentences

the entire outstanding principal amount shall have been repaid.

Each monthly payment shall be in an amount equal to the sum of (i) $ 5,000,000

of the principal in the aggregate (or the outstanding principal if less than such amount) (the “Amortization Principal Amount”),

plus (ii) 10 % of the Amortization Principal Amount, and (iii) the accrued and unpaid interest under the Convertible Note as of each payment

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Convertible notes (cont.)

Each monthly payment shall be in an amount equal to the sum of (i) $ 5,000,000 of

the principal in the aggregate (or the outstanding principal if less than such amount) (the “Amortization Principal Amount”),

plus (ii) 10 % of the Amortization Principal Amount, and (iii) the accrued and unpaid interest under the Convertible Note as of each

payment date.

An “Amortization Event” means (i)

1 unchanged sentence

the Company has issued to the Investor, pursuant to the transactions contemplated in a Convertible Note, the other notes and the SEPA,

in excess of 99 % of the common stock available under the exchange cap of 8,322,636 shares of common stock, which represent 19.99 % of the

aggregate number of shares common stock issued and outstanding as of the effective date of the SEPA, or (iii) any time after the effectiveness

deadline of February 8, 2025, the Investor is unable to utilize a registration statement to resell underlying common stock for a period

of ten (10) consecutive trading days (the last day of each such occurrence, an “Amortization Event Date”).

Pursuant to the Modification Agreement, the Company acknowledged, and

agreed that an event described in Section 1(c) of the Convertible Notes had occurred (the “Floor Price Event”) and was continuing

pursuant to the Convertible Notes, because the VWAP was less than the Floor Price for five consecutive Trading Days.

The Company acknowledged

and agreed that the Floor Price Event constituted an Amortization Event under the Convertible Notes which thereupon required the Company

to make monthly cash payments in accordance with Section 1(c) of the Convertible Notes.

The Company also agreed to make, cash payments

on the dates and in the minimum amounts under the promissory notes in the aggregate, as set forth in the table referenced above under

the “SEPA and Modification Agreement” section.

The Company may, at its option, make cash payments in excess of the specified

minimum amounts.

Such payments shall be applied to the reduction of the original principal amount of the convertible promissory note dated

November 25, 2025 first.

of March 31, 2025, the Company had paid the minimum payment of $ 850,000 as a result of the above-mentioned amortization event.

The Convertible Notes are accounted for as a single

liability measured at amortized costs.

in excess of 99 % of the common stock available under the exchange cap of 8,322,636 shares of common stock, which represent 19.99 %

of the aggregate number of shares common stock issued and outstanding as of the effective date of the SEPA, or (iii) any time after the

effectiveness deadline of February 8, 2025, the Investor is unable to utilize a registration statement to resell underlying common stock

for a period of ten (10) consecutive trading days (the last day of each such occurrence, an “Amortization Event Date”).

The Convertible Notes are accounted for as a

single liability measured at amortized costs.

The original issue discount and all the transaction costs related to issuance of the Convertible

3 unchanged sentences

to the Convertible Notes is 13.99 %.

First Modification

Pursuant to the Modification Agreement signed with the Investor on

March 21, 2025 (the “First Modification”), the Company confirmed, acknowledged, and agreed that an event described in Section

1(c) of the Convertible Notes occurred (the “Floor Price Event”) and is continuing, because the VWAP was less than the Floor

Price for five consecutive Trading Days.

The Company acknowledges that the occurrence of the Floor Price Event constitutes an Amortization

Event under the Convertible Notes, requiring the Company to make monthly cash payments in accordance with Section 1(c) of the Convertible

In connection with this obligation, the Company agreed to make cash payments on specified dates and in minimum amounts.

The payment schedule began with an initial payment

of $ 850,000 due on March 24, 2025 , followed by eight weekly minimum payments of $ 200,000 each, commencing the week of March 31, 2025 ,

and continuing through the week of May 19, 2025 .

In total, the Company was obligated to make minimum payments of $ 2,450,000 under this

The Company fully settled these minimum payments in accordance with

the payment schedule.

The Company also retains the option to make payments in excess of the stated minimums, and any such additional amounts

are applied first to reduce the original principal balance of the Convertible Note dated November 25, 2025.

In consideration of the covenants and agreements set forth in the Modification

Agreement dated March 21, 2025, the Investor agreed, from the date thereof until May 20, 2025, to:

(A) defer the Company’s obligation

to make monthly payments as a result of the Floor Price Event or otherwise pursuant to Section 1(c) of the Convertible Notes, (B) not

to submit any Conversion Notices or Investor Notices unless the stock traded at a price per share greater than $ 1.80 at the time any such

notice was delivered, and (C) waived the application of the Payment Premium in respect of Company payments made in accordance with Section

in each case provided that (i) the Company strictly complied with the terms of the Modification Agreement and (ii) there was

no occurrence or existence of any Event of Default or any breach of any term of any of the Financing Documents.

Since the change of the modified debt instrument was not substantially

different from those of the old debt, the First Modification is accounted for as a modification.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Convertible notes (cont.)

Repayments of Convertible Notes (cont.)

Second Modification

Pursuant to the Modification Agreement signed with the Investor on

June 6, 2025 (the “Second Modification”), the Company also agreed to make, cash payments on the dates and in the minimum amounts

under the promissory notes in the aggregate, as set forth below.

The Company may, at its option, make cash payments in excess of the minimum

amounts set forth below.

Payment made pursuant to the Modification Agreement was applied first to Promissory Note 2, then to Promissory

Note 1, unless otherwise agreed by the parties.

July 16, 2025

August 15, 2025

The present value of the cash flows under the

new debt instrument, when discounted at the effective interest rate of the original instrument, exceeds 10 % of the present value of the

remaining cash flows under the original instrument.

As the terms of the modified debt instrument are substantially different from those

of the original debt, the Second Modification is accounted for as an extinguishment.

The Company has fully settled the repayments

pursuant to the First Modification and Second Modification, and upon the conversion in September 2025, all outstanding convertible

notes were fully settled

Other Income (Expenses)

Other income and expenses consisted of the following:

three months ended

September 30,

three months ended

September 30,

Rental income

Rental expense

( 1,403,129 )

Interest income

Credit card rebate income

Gain on lease settlement and modification

HOLDING CORP.

2 unchanged sentences

The Company is authorized to issue 100,000,000

shares of common stock, par value US$ 0.00001 per share, 42,112,026 and 41,634,000 shares were issued and outstanding as of March 31, 2025

shares of common stock, par value US$ 0.00001 per share, with 45,443,079 and 42,250,934 shares issued and outstanding as of September

30, 2025 and June 30, 2025, respectively.

2 unchanged sentences

Boral Capital LLC;

hereinafter, the “Representative”)

, as representative of the several underwriters with respect to the Company’s initial public offering (the “IPO”)

and its affiliates warrants, exercisable during the five-year period from the commencement of sales of the shares of common stock offered

in the IPO , entitling the Representative to purchase an aggregate of up to 80,000 shares of common stock at a per share price equal to

125.0 % of the public offering price per share in the IPO, or US$ 6.25 (the “Representative’s Warrants”).

The fair value

of US$ 268,430 of the Representative’s Warrants, using the Black Scholes Model with the following weighted-average assumptions:

value of underlying share of US$ 4.62 , risk free rate of 4.46 %, expected term of five years ;

exercise price of the warrants of US$ 6.25 ,

volatility of 100 %;

hereinafter, the “Representative”), as representative of the several

underwriters with respect to the Company’s initial public offering (the “IPO”), and its affiliates, certain warrants,

exercisable during the five-year period from the commencement of sales of the shares of common stock offered in the IPO, entitling the

Representative to purchase an aggregate of up to 81,700 shares of common stock at a per share price equal to 125.0 % of

the public offering price per share in the IPO, or US$ 6.25 (the “Representative’s Warrants”).

The fair value of

US$ 268,430 of the Representative’s Warrants, using the Black Scholes Model with the following weighted-average assumptions:

market value of underlying share of US$ 4.62 , risk free rate of 4.46 %, expected term of five years ;

exercise price of the warrants

of US$ 6.25 , volatility of 100 %;

and expected future dividends of nil , was recorded in the Additional Paid-in Capital.

5 unchanged sentences

Notices pursuant to the SEPA.

In May 2025, the Company issued 138,908 shares

of common stock, par value of US$ 0.00001 per share, at a price of US$ 1.44 per share, for an aggregate amount of US$ 200,000 , for Investor

Notices pursuant to the SEPA.

In September 2025, the Company issued 77,669

and 3,114,476 shares of common stock, par value of US$ 0.00001 per share, at a price of US$ 1.29 and US$ 1.19 per share, respectively, for

an aggregate amount of US$ 3,800,000 , for Investor Notices pursuant to the SEPA.

Earnings per Share

Basic and diluted net earnings per share for the

nine months ended March 31, 2025 and 2024 were as follows:

Net income (loss) attributable to stockholders – basic and diluted

Weighted average number of shares of common stock outstanding – basic

(Loss) Earnings per share attributable to stockholders – basic

Weighted average number of shares of common stock outstanding – diluted

(Loss) Earnings per share attributable to stockholders – diluted

Basic earnings per share is computed using the

weighted average number of shares of common stock outstanding during the period.

Diluted earnings per share is computed using the weighted

average number of shares and dilutive share equivalents outstanding during the period.

For the three and nine months ended March 31, 2025,

the computation of diluted loss per share does not assume the impacts from the exercise of the Company’s outstanding unexercised

warrants and the convertible debt, due to its loss position for the three months and nine months ended March 31, 2025.

Basic and diluted net earnings per share for

the three months ended September 30, 2025 and 2024 were as follows:

three months ended

September 30,

three months ended

September 30,

Net loss attributable to stockholders

( 6,508,053 )

( 4,647,871 )

Weighted average number of shares of common stock outstanding – basic and diluted

Earnings per share attributable to stockholders – basic and diluted

Basic earnings per share is computed using

the weighted average number of shares of common stock outstanding during the period.

Diluted earnings per share is computed using

the weighted average number of shares and dilutive share equivalents outstanding during the period.

For the three months ended

September 30, 2025 and 2024, the computation of diluted loss per share does not assume the impacts from the exercise of the Company’s

outstanding unexercised warrants and the convertible debt, due to its loss position for the three months ended September 30,

2025 and 2024.

HOLDING CORP.

3 unchanged sentences

Other than the standby letters of credit with

Eastwest Bank in the aggregate amount of US$ 3,779,572 (see Note 2) and the operating and finance leases (See Note 7), the Company did

not have other significant commitments, long-term obligations, or guarantees as of March 31, 2025 and June 30, 2024.

Eastwest Bank in the aggregate amount of $ 4,391,165 (see Note 2) and the operating and finance leases (See Note 7), the Company did not

have other significant commitments, long-term obligations, or guarantees as of September 30, 2025 and June 30, 2025.

Contingencies

The Company is subject to legal proceedings and

regulatory actions in the ordinary course of business.

The results of such proceedings cannot be predicted with certainty, but the Company

does not anticipate that the final outcome arising out of any such matter will have a material adverse effect on the Company’s consolidated

financial position, cash flows or results of operations taken as a whole.

As of March 31, 2025 and 2024, the Company was not a party to

any material legal or administrative proceedings.

The Company is subject to legal proceedings

and regulatory actions in the ordinary course of business.

The results of such proceedings cannot be predicted with certainty, but

the Company does not anticipate that the final outcome arising out of any such matter will have a material adverse effect on the

Company’s consolidated financial position, cash flows or results of operations taken as a whole.

As of September 30, 2025 and

June 30, 2025, the Company was not a party to any material legal or administrative proceedings.

Related Party Transactions and Balances

4 unchanged sentences

Aidy Chou Founder, CEO, and substantial stockholder

Tong Wu Founder, Secretary, Treasurer, director, and substantial stockholder

DNA Motor Inc.

A company wholly-owned by Jacky Chen

A company wholly-owned by Tong Wu

Related Party Transactions

The Company had the following related party transactions:

the nine months ended March 31, 2025, the Company’s related parties, Jacky Chen, Aidy Chou and Tong Wu, together advanced nil (2024:

US$ 1,000 ) to support the Company’s working capital needs.

(“DNA”), the landlord of five of the Company’s operating leases, is owned by Jacky Chen.

During the nine

months ended March 31, 2025, for these operating leases, US$ 283,339 (2024:

US$ 302,537 ) lease expense was recorded in general and administrative

expenses, US$ 8,815,346 (2024:

US$ 8,724,422 ) was recorded in costs of sales and US$ 422,521 (2024:

(i) DNA Motor Inc.

(“DNA”), the lessor of four of the Company’s operating leases, is owned by Jacky Chen.

During the three months ended September 30, 2025, for these operating leases, US$ 75,714 (2024:

US$ 94,829 ) lease expense was recorded in general and administrative expenses, US$ 2,248,835 (2024:

US$ 2,989,368 ) was recorded in costs of services and US$ Nil (2024:

US$ 408,098 ) was recorded in other expenses.

The aggregate lease liability associated with these operating leases as of March 31, 2025 and June 30, 2024 was US$ 25,827,810 and US$ 34,714,898 ,

respectively.

the nine months ended March 31, 2025, the Company generated revenue of US$ 553 (2024:

US$ 1,362,898 ) for providing freight services to

During the nine months ended March 31, 2025, the Company generated revenue of US$ 884,700 (2024:

nil ) for providing warehousing services

During the nine months ended March 31, 2025, the Company paid expenses in the total amount of US$ 470,912 (2024:

US$ 3,030,583 )

on behalf of DNA.

The aggregate lease liability associated with these operating leases as of September 30, 2025 and June 30, 2025 was US$ 22,412,152 and US$ 24,092,384 , respectively.

The aggregate right-of-use assets related to these operating leases as of September 30, 2025 and June 30, 2025

was US$ 21,647,071 and US$ 23,410,085 , respectively.

(ii) During the three months ended September 30, 2025, the Company generated revenue of US$ Nil (2024:

US$ 553 ) for providing logistic services to DNA.

During the three months ended September 30, 2025, the Company generated revenue of US$ Nil (2024:

US$ 884,700 ) for providing warehouse services to DNA.

During the three months ended September 30, 2025, the Company paid expenses in the total amount of US$ 3,287 (2024:

US$ 716,789 ) on behalf of DNA.

The amount due from DNA is included in accounts receivable from a related party as disclosed in Note 3.

HOLDING CORP.

2 unchanged sentences

Related Party Transactions (cont.)

(v) During the nine months ended March 31, 2025,

the Company incurred cost of sales of US$ 1,603,146 (2024:

US$ 52,000 ) for services and other expenses provided by DNA.

(vi) On January 22, 2024, the Company entered into a loan agreement with Tong Wu in the principal amount of US$ 700,000 .

The loan matured on January 24, 2025 , bearing interest at an annual rate of 3.2 %.

On March 6, 2024, the loan was repaid by Tong Wu in full, including the principal and interest expense of US$ 2,700 .

Due to related party balance

The Company’s balances due to related parties

as of March 31, 2025 and June 30, 2024 were as follows:

The due to related party balances as of March

31, 2025 and June 2024 are unsecured, interest-free, and are due on demand.

(iii) During the three months ended September 30, 2025, the Company incurred general and administrative expenses of US$ 1,068,596 for outside services, warehouse supplies, freight expenses and operating expenses provided by DNA.

During the three months ended September 30, 2024, the Company incurred general and administrative expenses of US$ 607 for outside services, warehouse supplies, freight expenses and operating expenses provided by DNA.

Subsequent Events

The Company has evaluated the impact of events

that have occurred subsequent to March 31, 2025, through the date the consolidated financial statements were available to issue, and concluded

that no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure in the notes

to the unaudited interim condensed consolidated financial statements.

that have occurred subsequent to September 30, 2025, through the date the condensed consolidated financial statements were available

to issue, and concluded that no subsequent events have occurred that would require recognition in the consolidated financial statements

or disclosure in the notes to the unaudited interim condensed consolidated financial statements other than the below one.

On March 6, 2025, the Company entered into a

non-binding Letter of Intent to acquire 100 % of the issued and outstanding capital stock of Leopard Transnational Inc., a California-based

logistics provider with approximately 360,000 square feet of U.S.

warehouse space.

The proposed consideration includes common stock and

potential earn-out payments.

The transaction remains subject to due diligence, negotiation of a definitive agreement, and necessary approvals,

and had not been completed as of the date the financial statements were available to be issued.

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