What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-01-17 compared with 2024-07-11 · 309 added, 199 removed, 108 unchanged (82% of the section changed)

13 unchanged sentences

These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future.

Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking

Except as required by applicable law, including the securities laws of the U.S., we do not intend to update any of the forward-looking

statements to conform these statements to actual results, later events or circumstances or to reflect the occurrence of unanticipated

this report unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common

shares” or “common stock” refer to the common shares of our capital stock.

this report unless otherwise specified, all dollar amounts are expressed in US$ and all references to “common shares” or

“common stock” refer to the common shares of our capital stock.

management’s discussion and analysis of our financial condition and results of operations are based upon our financial statements,

6 unchanged sentences

December 20, 2021, the Company and Dr.

Low entered into the “EvoAir International Share Transfer Agreement, pursuant to which

Low agreed to sell all of his ordinary shares of EvoAir International to the Company for the consideration of US$100

(“EvoAir Transaction”).

EvoAir International, through its subsidiaries upon completion of the Transactions contemplated

under Note 1 of the Financial Statements, is engaged in the R&D, manufacturing, trading, sale of HVAC products and related services in Asia.

Low entered into the EvoAir International Share Transfer Agreement, pursuant to which Dr.

agreed to sell all of his ordinary shares of EvoAir International to the Company for the consideration of US$100 (“EvoAir Transaction”).

EvoAir International, through its subsidiaries upon completion of the Transactions contemplated under Note 1 to Financial Statements,

is engaged in the R&D, manufacturing, trading, sale of HVAC products and related services in Asia.

to the terms of a share transfer agreement dated December 20, 2021, Dr.

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outstanding ordinary shares of the Company, which resulted in a change of control of the Company.

International is a company incorporated in the BVI on November 17, 2021.

Effective from the December 20, 2021, it

wholly owns WKL Eco Earth Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth,

a Malaysian company incorporated on May 17, 2017, and (b) WKL Green Energy a Malaysian company incorporated on October 24, 2017.

Eco Earth Holdings acquired (c) EvoAir Manufacturing on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as

acquiring (d) WKL EcoEarth Indochina, a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou,

a Chinese company incorporated on April 6, 2021.

EvoAir Manufacturing wholly owns (f) Evo Air Marketing, a Malaysian company incorporated

on February 2, 2021.

December 20, 2021, several transactions took place (together, the “Allotment Transactions”) whereby the Company issued and

allotted in aggregate 98,809,323 EvoAir Shares to certain parties.

On completion of the Allotment Transactions, the total number of issued

and outstanding EvoAir Shares were 101,779,323 (“Then Enlarged Share Capital”):

On December 20, 2021, Dr.

Low and Chan Kok Wei entered into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which

Low and Chan Kok Wei agreed to sell all their ordinary shares of WKL Green Energy to WKL Eco Earth Holdings in consideration for

the allotment and issuance to WKL Global and Allegro Investment (BVI) Limited (“Allegro Investment”), a company incorporated

in the British Virgin Islands with 50% shareholding held by Chan Kok Wei and Ong Bee Chen, respectively, of 24,000 EvoAir Shares and

6,000 EvoAir Shares, respectively, or approximately 0.02% and 0.01% of the Then Enlarged Share Capital, respectively.

On December 20, 2021, Dr.

Low, Chan Kok Wei, Ong Bee Chen and certain sellers (collectively, the “WKLEE Sellers”) entered

into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which the WKLEE Sellers agreed to sell all their ordinary shares,

amounting in aggregate, 240,000 shares or 80% shareholding of WKL Eco Earth to WKL Eco Earth Holdings in consideration for the allotment

and issuance to WKL Global, Allegro Investment and WKLEE Sellers of 49,320 EvoAir Shares, 8,280 EvoAir Shares and in aggregate 14,400

EvoAir Shares, respectively, or approximately 0.05%, 0.009% and in aggregate 0.014%, respectively, of the Then Enlarged Share Capital.

On December 20, 2021, Tan Soon Hock, Ivan Oh Joon Wern and certain relevant interest holders (“Relevant Interest Holders”)

entered into an investment exchange agreement with WKL Eco Earth Holdings, pursuant to which the Tan Soon Hock, Ivan Oh Joon Wern and

the Relevant Interest Holders agreed to sell all relevant interests in the EvoAir Group to WKL Eco Earth Holdings in consideration for

the allotment and issuance of 7,037,762 shares, 2,520,000 shares and in aggregate 6,001,794 shares, respectively, of the common stock

of the Company, or approximately 6.91%, 2.48% and in aggregate 5.90%, respectively, of the issued and outstanding ordinary shares of

The board of directors and majority shareholders of the Company have approved the transaction.

On December 20, 2021, Dr.

Low entered into two deeds of assignment of intellectual properties with WKL Eco Earth Holdings, in respect

Low’s patents relating to eco-friendly air-conditioner condenser (external unit), EvoAir TM and the trademarks

described in the deed of assignment thereunder, and in respect of Dr.

Low’s patents relating to the portable air-conditioner, e-Cond

EVO TM and the trademarks as described in the deed of assignments thereunder (together, the “IP Assignments”).

Pursuant to the IP Assignments, WKL Global, Allegro Investment and certain nominees shall be allotted and issued 63,362,756 EvoAir Shares,

14,297,259 EvoAir Shares and in aggregate 5,487,752 EvoAir Shares, respectively or approximately 62.25%, 14.05% and in aggregate 5.39%,

respectively of the Then Enlarged Share Capital in consideration for the IP Assignments.

Transaction, Change of Control Transaction and Allotment Transactions are collectively to be referred to as the “Transactions”.

The closing of the Transactions (the “Closing”) occurred on December 20, 2021 (the “Closing Date”).

and after the Closing Date, at which time EvoAir International transferred its HVAC business to the Company, the Company’s primary

operations consisted of the prior operations of EvoAir International.

International is a company incorporated in BVI on November 17, 2021.

Effective from the December 20, 2021, it wholly owns WKL Eco Earth

Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth, a Malaysian company incorporated

on May 17, 2017, and (b) WKL Green Energy a Malaysian company incorporated on October 24, 2017.

WKL Eco Earth Holdings acquired (c) EvoAir

Manufacturing on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as acquiring (d) WKL EcoEarth Indochina,

a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou, a Chinese company incorporated on April

EvoAir Manufacturing wholly owns (f) Evo Air Marketing, a Malaysian company incorporated on February 2, 2021.

June 15, 2022, the Company filed a Certificate of Amendment (the “Amendment”) to the Articles of Incorporation with Nevada’s

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under the new ticker symbol “EVOH”.

November 21, 2023, the Company issued in aggregate, 52,107 shares of Common Stock to 15 referral agents (“Referral Agents”)

in consideration for their referral to the Company of certain investors.

Each Referral Agent is a “non-U.S.

Persons” as defined

in Regulation S.

November 21, 2023, the Company issued, in aggregate, 5,500 shares of Common Stock to two individuals in consideration for marketing services

provided to the Company by Artisan Creative Studio, a marketing entity based in Malaysia.

Each of the individuals is a “non-U.S.

Persons” as defined in Regulation S.

2 Stockholders

Company entered into a series of offerings for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of

$2.50, as follows:

February 15, 2022, the Company entered into certain share subscription agreement with Ms.

Ang Lee Kim Jane, who is a “non-U.S.

Persons” (the “Investor”) as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities

Act”) pursuant to which the Company agreed to issue and sell 74,074 Shares, par value $0.001 per share, at a per share purchase

price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per

share purchase price of $2.50.

The gross proceeds was $185,185.

June 3, 2022, the Company entered into certain share subscription agreement with Mr.

Wong Hon Wai who is a “non-U.S.

(the “Investor”) as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities Act”)

pursuant to which the Company agreed to issue and sell 5,000 shares, par value $0.001 per share , at a per share purchase price of

$2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share

purchase price of $2.50.

The gross proceeds was $12,500.

October 25, 2022, the Company entered into Regulation S share subscription agreements with eight investors, each of whom represented

that it was a “non-U.S.

Persons” as defined in Securities Act.

On the same date, the Company entered into Regulation

D share subscription agreements with two investors, each of whom represented that it was an “Accredited Investors” as

defined in Regulation D of the Securities Act.

Pursuant to the share subscription agreements, the Company agreed to issue and sell

in aggregate, (i) 129,621 shares of Common Stock, par value $0.001 per share to the Regulation S investors, and (ii) 15,000 shares

of Common Stock to the Regulation D investors, respectively par value $0.001 per share, at a per share purchase price of $2.50, as

part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price

The gross proceeds in aggregate were $361,553.

February 20, 2023, the Company entered into Regulation S share subscription agreements with eleven investors, each of whom represented

that it was a “non-U.S.

Persons” as defined in Regulation S of the Securities Act.

Pursuant to the agreements, the Company

agreed to issue and sell in aggregate, (i) 57,783 shares of Common Stock, par value $0.001 per share to the Regulation S investors,

at a per share purchase price of $2.50 as part of a series of the private placement offerings by the Company for an aggregate of

up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50.

The gross proceeds in aggregate was $144,443.

July 13, 2023, the Company entered into Regulation S share subscription agreements with 31 investors, each of whom represented that

it was a “non-U.S.

Persons” as defined in Regulation S of the Securities Act.

Pursuant to the agreements, the Company

agreed to issue and sell in aggregate, (i) 250,132 shares of Common Stock, par value $0.001 per share to the Regulation S Investors,

at a per share purchase price of $2.50 as part of a series of the private placement offerings by the Company for an aggregate of

up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50.

The gross proceeds in aggregate was approximately

September 7, 2023, the Company entered into Regulation S share subscription agreements with 71 investors, each of whom represented

that it was a “non-U.S.

Persons” as defined in Regulation S of the Securities Act.

Pursuant to the agreements, the Company

agreed to issue and sell in aggregate, 365,164 shares of Common Stock, par value $0.001 per share to the Regulation S investors,

at a per share purchase price of $2.50 as part of a series of the private placement offerings by the Company for an aggregate of

up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50.

The gross proceeds in aggregate was approximately

November 21, 2023, the Company entered into a Regulation S share subscription agreement with Wong Chun Shoong who represented that

he was a “non-U.S.

Persons” as defined in Regulation S of the Securities Act.

Pursuant to the agreement, the Company

agreed to issue and sell in aggregate, 8,658 shares of Common Stock, par value $0.001 per share to the Regulation S investors, at

a per share purchase price of $2.50 as part of a series of the private placement offerings by the Company for an aggregate of up

to 6,000,000 shares of Common Stock at a per share purchase price of $2.50.

The gross proceeds in aggregate was approximately $21,645.

Reverse Stock Split

On April 12, 2024, the Company’s board of directors

(the “Board”) unanimously resolved to effect a reverse stock split of the Company’s common stock, par value $0.001 per

share (the “Common Stock”), at a ratio of 1-for-4.

Following such resolution, on September 9, 2024, the Company filed a Certificate

of Amendment (the “Certificate of Amendment”) with the Secretary of State of the State of Nevada to effect the reverse stock

split, with an effective time of 9:00AM.

Eastern Time on September 11, 2024 (the “Reverse Stock Split”).

Split Adjustment;

Treatment of Fractional Shares

As a result of the 1:4 Reverse Stock Split, each 4

pre-split shares of Common Stock outstanding will automatically combine into one new share of Common Stock without any action on the part

of the holders, and the number of outstanding shares of Common Stock was reduced from 102,742,362 shares to 25,685,591 shares (subject

to rounding up of fractional shares to the nearest whole number).

No fractional shares were issued in connection with

the Reverse Stock Split.

Fractional shares were rounded up to the nearest whole number

Share Issuance

On November 25, 2024, the Company issued, in aggregate,

679,516 shares of Common Stock, representing 2.5% of the issued and outstanding shares of Common Stock to certain project management consultant

in consideration for their services in relation to proposed initial public offering.

On November 25, 2024, the Company issued, in aggregate,

815,419 shares of Common Stock, representing 3.0% of the issued and outstanding shares of Common Stock to certain corporate and business

consultant in consideration for their consulting services.

of Operation and Funding

expect that working capital requirements will continue to be funded through internally generated funds and proceeds from issuances of

Our working capital requirements are expected to increase in line with the growth of our business.

working capital, proceeds from issuance of securities, further advances, and anticipated cash flow are expected to be adequate to fund

our operations over the next twelve months.

We have no lines of credit or other bank financing arrangements.

Generally, we have financed

operations to date through internally generated funds, advances and proceeds from issuance of securities.

In connection with our business

plan, management anticipates additional increases in operating expenses and capital expenditures relating to:

(i) research and development;

(ii) expansion of product offerings;

(iii) geographical expansion;

and (iv) marketing expenses.

We intend to finance these expenses with

further issuances of securities and advances.

Thereafter, we expect we will need to raise additional capital and generate revenue to

meet long-term operating requirements.

Additional issuances of equity will result in dilution to our current shareholders.

Further, such

securities might have rights, preferences, or privileges senior to our common stock.

Additional financing may not be available upon acceptable

terms, or at all.

If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage

of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

of Operations

following summary of our operations should be read in conjunction with our unaudited condensed consolidated financial statements for

the three and nine months ended May 31, 2024, as compared to the three and nine months ended May 31, 2023.

Months Ended May 31, 2024, versus Three Months Ended May 31, 2023

Three Months Ended May 31

the three months ended November 30, 2024, as compared to the three months ended November 30, 2023.

Months Ended November 30, 2024, versus Three Months November 30, 2023.

Three Months Ended

Cost of revenue

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Loss from operation

Other income/(expense)

Loss from operation before income taxes

$ (4,640,904 )

Company generated revenues of $89,616 in the three months ended May 31, 2024, as compared to $165,726 in the three months ended May 31,

2023, a decrease in revenue of $76,110.

The decline in revenue mainly due to decrease in sales of eco-friendly air-conditioners.

first mover in launching EvoAir TM , first-of-its-kind eco-friendly air-conditioner with granted patent or utility model/patent

or utility model pending HECS system proprietary system, the Group faced both opportunities and challenges.

In the course of applying

for some of the certifications, safety and performance testing, the relevant authorities/ organizations faced the challenges in assigning

our products in the appropriate category under conventional air-conditioner regime.

There are instances whereby some of these authorities/

organizations do not possess the relevant equipment to conduct testings.

It took a lot of education, discussions, deliberations and working

with the authorities/ organizations to work out solutions to resolve compliance and testing matters.

On the positive note, one of the

authorities advised us to apply under a new category, ‘Hybrid Air Conditioner.

The duration of the application processes were longer

than that of typical certifications and testing for conventional air-conditioners.

a first mover, notwithstanding many of our corporate clients who were impressed and showed keen interest in our products, EvoAir TM ,

many of them took a few months to conduct study on their own accord on performance and the energy savings of our products.

is building up its traction for the EvoAir TM hybrid air-conditioners for both residentials and commercial/ industrial units

through distribution channels, projects, building and businesses as well as private labelling and licensing model.

the financial period, EvoAir Manufacturing entered into an OEM supply agreement (the “OEM Agreement”) with Tadmonsori Holdings

Sdn Bhd (“THSB”) pursuant to which the parties have agreed for THSB to purchase certain products (the “Products”)

from EvoAir Manufacturing to resell directly under THSB’s branding, trademark, graphics, packaging designs and artwork, with the

insertion of the words “Powered by EvoAir” inserted at the back of each Product, to THSB end user customers.

The OEM Agreement

will be renewable on a three-year basis, and upon the execution of the Agreement, THSB shall have made a minimum order of 3,000 units

of the Products upon signing of the OEM Agreement, and to target a total sales turnover of 105,000,000 Malaysia Ringgit (approximately

US$22,522,522, as calculated at the Foreign Exchange Rate of US$1 = 4.6620 Malaysia Ringgit on December 8, 2023, as published in H.10

statistical release of the United States Federal Reserve Board) over 3 years from January 1, 2024 to December 31, 2026.

cost of revenue was $56,741, or 63% of revenue, for the three months ended May 31, 2024, as compared to $124,647, or 75% of revenue,

in the same financial period in 2023.

The decline in cost of revenue for the comparative figures is in line with the drop in sales for

the eco-friendly air - conditioner

Cost of revenues includes production costs and purchases of goods.

profit was $32,875, or a gross profit margin of 37% for the three months ended May 31, 2024, as compared to gross profit of $41,079 in

the same financial period in 2023, or a gross profit margin of 25%.

The increase in gross profit margin for the comparative figures was

attributable to decrease in some of the production costs components such as freight charges.

expenses were $1,007,694 for the three months ended May 31, 2024, compared to $1,468,153 in the corresponding period in 2023, a decrease

The decrease in operating expenses was not primarily due to the decrease in general and administrative expenses since the

IPO-related offering cost was capitalized.

income increased significantly mainly due to $82,389 realized foreign exchange gain from amount due to shareholders wires.

loss from operation before income taxes for the three months ended May 31, 2024, was $974,441, compared to $1,513,423 for the

corresponding period in 2023.

The continuous net loss is attributable to EVOH and its subsidiaries (“Group” or “EvoAir Group”)’s focused

effort in creating the infrastructure and resources to meet its business expansion needs and lack of economies of scale.

Months Ended May 31, 2024, versus Nine Months Ended May 31, 2023

Nine Months Ended May 31

Cost of revenue

Gross (loss)/profit

Operating expenses

Loss from operation

Other income/(expense)

Loss from operation before income taxes

$ (1,524,321 )

Company generated revenues of $222,108 in the nine months ended May 31, 2024, as compared to $379,323 in the nine months ended May

Group generated revenues of $51,929 in the three months ended November 30, 2024, as compared to $91,318 in the three months ended November

30, 2023, a decrease in revenue of $39,389.

The decline in revenue mainly due to decrease in

sales of eco-friendly air-conditioners,