What changed in this filing

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Item 1A. Risk Factors

2026-07-23 compared with 2025-07-15 · 410 added, 342 removed, 630 unchanged (54% of the section changed)

An investment in our common stock involves

a high degree of risk.

You should carefully consider the risks and uncertainties described below, together with all of the other information

in this annual report, including “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations”

and our consolidated financial statements and related notes before making a decision to invest in our common stock.

Our business, operating

results, financial condition, or prospects could be materially and adversely affected by any of these risks and uncertainties.

of these risks actually occurs, the trading price of our common stock could decline and you might lose all or part of your investment.

Our business, operating results, financial performance, or prospects could also be harmed by risks and uncertainties not currently known

to us or that we currently do not believe are material.

An investment in our common

stock involves a high degree of risk.

You should carefully consider the risks and uncertainties described below, together with all of

the other information in this annual report, including “Item 7.

Management’s Discussion and Analysis of Financial Condition

and Results of Operations” and our consolidated financial statements and related notes before making a decision to invest in our

common stock.

Our business, operating results, financial condition, or prospects could be materially and adversely affected by any of

these risks and uncertainties.

If any of these risks actually occurs, the trading price of our common stock could decline and you might

lose all or part of your investment.

Our business, operating results, financial performance, or prospects could also be harmed by risks

and uncertainties not currently known to us or that we currently do not believe are material.

Summary of Risk Factors

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Operations, and Industry

An adverse determination in any significant product liability claim against us could materially adversely affect our business, results of operations or financial condition.

We are subject to a pending securities class action lawsuit, and we may become subject to additional legal proceedings that could adversely affect our business, financial condition, and results of operations.

We may not meet our growing production and delivery plans, which could harm our business.

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Future stock sales may dilute ownership and lower the stock price.

● Directors and executive officers’ 18.7% control may block beneficial actions for shareholders.

Delaware laws and corporate bylaws may hinder mergers or takeovers.

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Operations, and Industry

An adverse determination in any significant

product liability claim against us could materially adversely affect our business, results of operations or financial condition.

The development, production,

marketing, sale and usage of our vehicles will expose us to significant risks associated with product liability claims.

As a provider

of consumer products, we are, from time to time, subject to civil litigation regarding those products, including in publicly-available

court filings.

Our business is vulnerable to product liability claims, and we may face inherent risk of exposure to claims in the event

our vehicles do not perform or are claimed to not have performed as expected.

If our products are defective, malfunction or are used incorrectly

by our customers, it may result in bodily injury, property damage or other injury, including death, which could give rise to product liability

claims against us.

For example, our certain EVs use lithium-ion batteries, which, if not appropriately managed and controlled, can rapidly

release energy by venting smoke and flames that can ignite nearby materials.

Any potential issues with the lithium-ion batteries used

in our EVs could have a material adverse effect on our business, financial condition, and results of operations, including a significant

negative impact on our revenue.

Furthermore, there is some risk of electrocution if individuals who attempt to repair battery packs do

not follow applicable maintenance and repair protocols.

Any such damage or injury would likely lead to product liability claims against

us and potentially a safety recall.

Any losses that we may suffer from any liability claims and the effect that any product liability

litigation may have upon the brand image, reputation and marketability of our products could have a material adverse impact on our business,

results of operations or financial condition.

No assurance can be given that material product liability claims will not be made in the

future against us, or that claims will not arise in the future in excess or outside of our insurance coverage and contractual indemnities

with suppliers and manufacturers.

We may not be able to obtain adequate product liability insurance for our existing or new products or

the cost of doing so may be prohibitive.

Adverse determinations of material product liability claims made against us could also harm our

reputation and cause us to lose customers and could have a material adverse effect on our business, prospects, financial condition and

operating results.

We are subject to a pending securities class

action lawsuit, and we may become subject to additional legal proceedings that could adversely affect our business, financial condition,

and results of operations.

On September 8, 2025, a federal

securities class action was filed in the United States District Court, Eastern District of New York, by plaintiff Dino Kurt, individually

and on behalf of all others similarly situated, against defendants, the Company, chief executive officer, Zhou Ou, and former chief financial

officer, Shiwen Feng (the “Class Action”).

On October 28, 2025, a shareholder derivative lawsuit was filed purportedly on

behalf of the Company, as nominal defendant, against certain of its current and former directors and officers in the United States Court

for the Eastern District of New York, captioned Flynn v.

Ou et al, No.

1:25-cv-06036 (E.D.N.Y.) (the “Flynn Action”).

22, 2026, the lead plaintiff in the Class Action filed an Amended Complaint.

The Company's response to the Amended Complaint is due August

Securities Class Action and

the Flynn Action may result in substantial costs and divert our management’s attention and resources, which could harm our business.

Any adverse determination in the Lawsuit or similar litigation could require us to pay significant monetary damages and could harm our

We cannot predict the outcome of the legal proceedings or estimate the range of potential loss, if any, that could result

from an adverse judgment.

We may also become subject to additional litigation or legal proceedings in the future, including stockholder

derivative suits or additional securities class actions.

Such litigation could be time-consuming and expensive to defend, and could result

in the diversion of time and attention by our management and in substantial damages, settlement costs, or judgments against us.

Our insurance

may not cover all claims that may be asserted against us, and any claims asserted against us, regardless of merit or eventual outcome,

may harm our reputation.

The occurrence of any of these events could have a material adverse effect on our business, financial condition,

results of operations, and the trading price of our common stock.

We may be unable to meet our growing production

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experience difficulties.

If our principal vendors decide

to terminate their partnership with us, experience sourcing failures, or otherwise become unable to provide us with the necessary components

in sufficient quantities, in a timely manner, and on acceptable terms, we may have to delay the production and sale of our products or

find an alternative vendor.

Any significant unanticipated demand would require us to procure additional components in a short amount of

While we believe that we will be able to secure additional or alternate sources of supply for most of our components in a relatively

short time frame, there is no assurance that we will be able to do so or develop our own replacements for certain highly customized components

of our products.

If our principal vendors

decide to terminate their partnership with us, experience sourcing failures, or otherwise become unable to provide us with the necessary

components in sufficient quantities, in a timely manner, and on acceptable terms, we may have to delay the production and sale of our

products or find an alternative vendor.

Any significant unanticipated demand would require us to procure additional components in a short

amount of time.

While we believe that we will be able to secure additional or alternate sources of supply for most of our components in

a relatively short time frame, there is no assurance that we will be able to do so or develop our own replacements for certain highly

customized components of our products.

In addition, if we encounter

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and at scale is unproven.

Our business success will depend

in large part on our ability to economically produce, market and sell our vehicles at sufficient capacity to meet the demands of our customers.

Our business success will

depend in large part on our ability to economically produce, market and sell our vehicles at sufficient capacity to meet the demands of

our customers.

We will need to scale our production capacity in order to successfully implement our growth strategy.

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of increased production of similar products by our competitors, and could adversely affect our business and operating results.

● an increase in the cost, or decrease in the available supply,

of materials used in the battery packs;

an increase in the cost, or decrease in the available supply, of materials used in the battery packs;

tariffs on the materials we source in China;

● fluctuations in the value of the Chinese Renminbi against

fluctuations in the value of the Chinese Renminbi against the U.S.

dollar as our purchases for the components of our products are denominated in Chinese Renminbi.

Disruption in our supply chain

and rising prices of raw materials as a result of the conflict between Russia and Ukraine may also negatively impact our businesses.

February 2022, Russian military forces launched a military action in Ukraine.

Disruption in our supply

chain and rising prices of raw materials as a result of the conflict between Russia and Ukraine may also negatively impact our businesses.

In February 2022, Russian military forces launched a military action in Ukraine.

The ongoing military action between Russia and Ukraine,

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input costs and could potentially have substantial impact on the global economy and our business for an unknown period of time.

Substantial increases in the

prices for our materials or prices charged to us would increase our operating costs, and could reduce our margins if we cannot recoup

Substantial increases in

the prices for our materials or prices charged to us would increase our operating costs, and could reduce our margins if we cannot recoup

the increased costs through increased prices.

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impact on our business, prospects, financial condition and operating results.

In addition, the range of our

vehicles on a single charge declines principally as a function of usage, time and charging patterns as well as other factors.

a customer’s use of his or her electric vehicle as well as the frequency with which he or she charges the battery can result in

additional deterioration of the battery’s ability to hold a charge.

In addition, the range of

our vehicles on a single charge declines principally as a function of usage, time and charging patterns as well as other factors.

example, a customer’s use of his or her electric vehicle as well as the frequency with which he or she charges the battery can result

in additional deterioration of the battery’s ability to hold a charge.

Furthermore, our vehicles may contain defects in design and

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the adoption of new energy vehicles, and specifically electric vehicles, include:

● perceptions about electric vehicle quality, safety, design,

performance and cost, especially if adverse events or accidents occur that are linked to the quality or safety of electric vehicles,

whether or not such vehicles are produced by us or other companies;

perceptions about electric vehicle quality, safety, design, performance and cost, especially if adverse events or accidents occur that are linked to the quality or safety of electric vehicles, whether or not such vehicles are produced by us or other companies;

perceptions about vehicle safety in general;

● the limited range over which electric vehicles may be driven

on a single battery charge and the speed at which batteries can be recharged;

● the decline of an electric vehicle’s range resulting

from deterioration over time in the battery’s ability to hold a charge;

the limited range over which electric vehicles may be driven on a single battery charge and the speed at which batteries can be recharged;

the decline of an electric vehicle’s range resulting from deterioration over time in the battery’s ability to hold a charge;

the availability of service for electric vehicles;

the environmental consciousness of consumers;

● the availability of tax and other governmental incentives

to purchase and operate electric vehicles or future regulation requiring increased use of nonpolluting vehicles;

the availability of tax and other governmental incentives to purchase and operate electric vehicles or future regulation requiring increased use of nonpolluting vehicles;

macroeconomic factors.

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to rapidly changing and often complex regulatory environments.

The electric mobility

industry is subject to rapidly changing and often complex regulatory environments at local, state, national, and international

Evolving regulations related to safety standards, emissions, licensing, and operational requirements can have a substantial

impact on our business operations and profitability.

Compliance with these changing regulations may necessitate costly modifications

to our products, business processes, or market strategies, which could lead to increased expenses and delays in product development

and market entry.

Failure to navigate and adhere to evolving regulations adequately could result in legal and financial liabilities,

damage to our reputation, and potential market restrictions.

Furthermore, inconsistency in regulations between different

jurisdictions may create challenges in maintaining uniform business practices and product offerings, increasing our exposure to

regulatory risks.

Furthermore, a significant portion of our customer base comprises food delivery workers, and if leading food

delivery platforms like Uber Eats and DoorDash impose new requirements on the type of electric vehicles they allow, non-compliance

on our part could result in the loss of these customers.

While we believe we are presently in compliance with applicable laws and

regulations in our operating regions, there can be no assurance that we can always promptly adapt to the rapidly changing regulatory

If we fail to effectively adjust to the changing regulatory landscape and comply with applicable laws and regulations

in our operating regions, our business, prospects, financial condition and operating results would be materially and adversely

The electric mobility industry

is subject to rapidly changing and often complex regulatory environments at local, state, national, and international levels.

regulations related to safety standards, emissions, licensing, and operational requirements can have a substantial impact on our business

operations and profitability.

Compliance with these changing regulations may necessitate costly modifications to our products, business

processes, or market strategies, which could lead to increased expenses and delays in product development and market entry.

navigate and adhere to evolving regulations adequately could result in legal and financial liabilities, damage to our reputation, and

potential market restrictions.

Furthermore, inconsistency in regulations between different jurisdictions may create challenges in maintaining

uniform business practices and product offerings, increasing our exposure to regulatory risks.

Furthermore, a significant portion of our

customer base comprises food delivery workers, and if leading food delivery platforms like Uber Eats and DoorDash impose new requirements

on the type of electric vehicles they allow, non-compliance on our part could result in the loss of these customers.

While we believe

we are presently in compliance with applicable laws and regulations in our operating regions, there can be no assurance that we can always

promptly adapt to the rapidly changing regulatory environment.

If we fail to effectively adjust to the changing regulatory landscape and

comply with applicable laws and regulations in our operating regions, our business, prospects, financial condition and operating results

would be materially and adversely affected.

We may be unable to adequately control the

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and evolving business model include our ability to:

● make operating decisions and evaluate our future prospects

and the risks and challenges we may encounter;

make operating decisions and evaluate our future prospects and the risks and challenges we may encounter;

forecast our revenue and budget for and manage our expenses;

● attract new customers and retain existing customers in a

cost-effective manner;

● comply with existing and new or modified laws and regulations

applicable to our business;

attract new customers and retain existing customers in a cost-effective manner;

comply with existing and new or modified laws and regulations applicable to our business;

manage our business assets and expenses;

● plan for and manage capital expenditures for our current

and future offerings and manage our supply chain and supplier relationships related to our current and future offerings;

● anticipate and respond to macroeconomic changes and changes

in the markets in which we operate;

plan for and manage capital expenditures for our current and future offerings and manage our supply chain and supplier relationships related to our current and future offerings;

anticipate and respond to macroeconomic changes and changes in the markets in which we operate;

maintain and enhance the value of our reputation and brand;

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successfully expand our geographic reach;

● hire, integrate and retain talented people at all levels

of our organization;

● successfully develop new features, offerings and services

to enhance the experience of customers.

hire, integrate and retain talented people at all levels of our organization;

successfully develop new features, offerings and services to enhance the experience of customers.

If our assumptions regarding

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or otherwise.

As of March 31, 2025, we had

cash of $0.8 million.

As of March 31, 2026, we

had cash of $0.3 million.

We had working capital of $10.0 million and $1.3 million as of March 31, 2026 and March 31, 2025,

respectively.

We had net loss of $5.3 million and net income of $1.9 million for the year ended March 31, 2025 and 2024, respectively.

During the year ended March 31, 2025, net cash used in operating activities of the Company was approximately $10.1 million.

March 31, 2025, we had a current portion of contractual obligation of approximately $8.9 million.

We plan to alleviate the going

concern risk through (i) equity financing to support the Company’s working capital;

(ii) other available sources of financing

(including debt) from banks and other financial institutions;

We had net loss of $9.3 million and $5.3 million for the year ended March 31, 2026 and 2025, respectively.

During the year

ended March 31, 2026, net cash used in operating activities of the Company was approximately $13.8 million.

As of March 31, 2026,

we had a current portion of contractual obligation of approximately $5.5 million.

We plan to alleviate the going concern risk through

(i) equity financing to support the Company’s working capital;

(ii) other available sources of financing (including debt)

from banks and other financial institutions;

and (iii) financial support from the Company’s related parties.

There is no assurance that we will be successful in implementing the foregoing plans or that additional financing will be available to

us on commercially reasonable terms, or at all.

Our inability to secure needed financing when required could require material changes

to our business plans and could have a material adverse effect on our ability to continue as a going concern and results of operations.

There is no assurance

that we will be successful in implementing the foregoing plans or that additional financing will be available to us on commercially reasonable

terms, or at all.

Our inability to secure needed financing when required could require material changes to our business plans and could

have a material adverse effect on our ability to continue as a going concern and results of operations.

We identified material weaknesses in our

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management as well as cyber security management.

response to the material weaknesses identified for the year ended March 31, 2025, we are in the process of implementing a number

of measures to address the material weaknesses identified, including but not limited to (i) hiring additional qualified accounting

and financial personnel with appropriate knowledge and experience in U.S.

In response to the material

weaknesses identified for the year ended March 31, 2026, we are in the process of implementing a number of measures to address the

material weaknesses identified, including but not limited to (i) hiring additional qualified accounting and financial personnel with

appropriate knowledge and experience in U.S.

GAAP accounting and SEC reporting;

(ii) organizing

regular training for our accounting staff, especially training related to U.S.

(ii) organizing regular training for our accounting

staff, especially training related to U.S.

GAAP and SEC reporting requirements;

and (iii) regularly

conducting checks on the IT software we utilize to ensure its proper functionality, and arranging training sessions for our IT staff.

We also plan to adopt additional measures to improve our internal control over financial reporting, including, among others, creating

GAAP accounting policies and procedures manual, which will be maintained, reviewed and updated, on a regular basis, to the

GAAP accounting standards, strengthening corporate governance as well as general control over our information technology.

While we believe these efforts, once completed, will remediate the material weaknesses, we may not be able to complete our evaluation,

testing or any required remediation in a timely fashion, or at all.

We cannot assure you that the measures we have taken to date and

may take in the future, will be sufficient to remediate the control deficiencies that led to our material weaknesses in internal control

over financial reporting, to prevent the identification of significant deficiencies in the future or that they will prevent or avoid

potential future material weaknesses.

The effectiveness of our internal control over financial reporting is subject to various inherent

limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the possibility

of human error and the risk of fraud.

If we are unable to remediate the material weaknesses, our ability to record, process and report

financial information accurately, and to prepare financial statements within the time periods required of public companies could be adversely

affected which, in turn, may adversely affect our reputation and business and the market price of our common stock.

In addition, any

such failures could result in litigation or regulatory actions by the SEC or other regulatory authorities, loss of investor confidence,

delisting of our securities and harm our reputation and financial condition, or diversion of financial and management resources from

the operation of our business.

and (iii) regularly conducting checks on the

IT software we utilize to ensure its proper functionality, and arranging training sessions for our IT staff.

We also plan to adopt additional

measures to improve our internal control over financial reporting, including, among others, creating a U.S.

GAAP accounting policies

and procedures manual, which will be maintained, reviewed and updated, on a regular basis, to the latest U.S.

GAAP accounting standards,

strengthening corporate governance as well as general control over our information technology.

While we believe these efforts, once completed,

will remediate the material weaknesses, we may not be able to complete our evaluation, testing or any required remediation in a timely

fashion, or at all.

We cannot assure you that the measures we have taken to date and may take in the future, will be sufficient to remediate

the control deficiencies that led to our material weaknesses in internal control over financial reporting, to prevent the identification

of significant deficiencies in the future or that they will prevent or avoid potential future material weaknesses.

The effectiveness of

our internal control over financial reporting is subject to various inherent limitations, including cost limitations, judgments used in

decision making, assumptions about the likelihood of future events, the possibility of human error and the risk of fraud.

If we are unable

to remediate the material weaknesses, our ability to record, process and report financial information accurately, and to prepare financial

statements within the time periods required of public companies could be adversely affected which, in turn, may adversely affect our reputation

and business and the market price of our common stock.

In addition, any such failures could result in litigation or regulatory actions

by the SEC or other regulatory authorities, loss of investor confidence, delisting of our securities and harm our reputation and financial

condition, or diversion of financial and management resources from the operation of our business.

The markets in which we operate are in their

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their services and any interruption in their ability to provide their services could cause us to cease operations.

The loss of the services of

any member of our management team, including our CEO, could have a material adverse effect on us.

The loss of the services

of any member of our management team, including our CEO, could have a material adverse effect on us.

We do not maintain any key man life

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in operating a publicly traded company.

While our management team has

a wide breadth of business experience, none of our executive officers have held an executive position at a publicly traded company.

the onerous compliance requirements to which public companies are subject, there is a chance our executive officers will fail to perform

at a level expected of public company officers.

While our management team

has a wide breadth of business experience, none of our executive officers have held an executive position at a publicly traded company.

Given the onerous compliance requirements to which public companies are subject, there is a chance our executive officers will fail to

perform at a level expected of public company officers.

In such an event, the Company’s share price could be adversely affected.

The management

team’s limited experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage

in that it is likely that an increasing amount of their time may be devoted to these activities which will result in less time being devoted

to the management and growth of the company.

We may not have adequate personnel with the appropriate level of knowledge, experience and

training in the accounting policies, practices or internal control over financial reporting required of public companies in the United States.

In addition, the development and implementation of the standards and controls necessary for us to achieve the level of accounting standards

required of a public company in the United States may require costs greater than expected.

It is possible that we will be required

to expand our employee base and hire additional employees to support our operations as a public company which will increase our operating

costs in future periods.

The management team’s limited experience in dealing with the increasingly complex laws pertaining to public companies could be a

significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities which will result

in less time being devoted to the management and growth of the company.

We may not have adequate personnel with the appropriate level

of knowledge, experience and training in the accounting policies, practices or internal control over financial reporting required of public

companies in the United States.

In addition, the development and implementation of the standards and controls necessary for us to

achieve the level of accounting standards required of a public company in the United States may require costs greater than expected.

It is possible that we will be required to expand our employee base and hire additional employees to support our operations as a public

company which will increase our operating costs in future periods.

We may need to defend ourselves against

patent or trademark infringement claims, which may be time-consuming and would cause us to incur substantial costs.

Companies, organizations or

individuals, including our competitors, may hold or obtain patents, trademarks or other proprietary rights that would prevent, limit or

interfere with our ability to make, use, develop, sell or market our vehicles, which could make it more difficult for us to operate our

Companies, organizations

or individuals, including our competitors, may hold or obtain patents, trademarks or other proprietary rights that would prevent, limit

or interfere with our ability to make, use, develop, sell or market our vehicles, which could make it more difficult for us to operate

our business.

From time to time, we receive communications from holders of patents or trademarks regarding their proprietary rights, including

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rights, we may be required to do one or more of the following:

● cease selling, incorporating certain components into, or

using vehicles or offering goods or services that incorporate or use the challenged intellectual property;

cease selling, incorporating certain components into, or using vehicles or offering goods or services that incorporate or use the challenged intellectual property;

pay substantial damages;

● seek a license from the holder of the infringed intellectual

property right, which license may not be available on reasonable terms or at all;

seek a license from the holder of the infringed intellectual property right, which license may not be available on reasonable terms or at all;

redesign our vehicles or other goods or services;

● establish and maintain alternative branding for our products

and services.

establish and maintain alternative branding for our products and services.

In the event of a successful

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due to product warranty claims or product recalls could have a material adverse impact on our business, results of operations or financial

We provide a three-month warranty

against defects for our EVs and three-month warranty on the battery.

Our warranty will generally require us to repair or replace defective

products during such warranty periods at no cost to the consumer.

We will record provisions based on an estimate of product warranty claims,

but there is the possibility that actual claims may exceed these provisions and therefore negatively impact our results of operations

or financial condition.

We provide a three-month

warranty against defects for our EVs and three-month warranty on the battery.

Our warranty will generally require us to repair or replace

defective products during such warranty periods at no cost to the consumer.

We will record provisions based on an estimate of product

warranty claims, but there is the possibility that actual claims may exceed these provisions and therefore negatively impact our results

of operations or financial condition.

In addition, we may in the

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a change in corporate control.

The existing holdings of our directors and executive officers is in

the aggregate, approximately 18.7% of our outstanding common stock as of the date of this annual report.

As a result, these stockholders

may be able to influence our management and affairs and control the outcome of matters submitted to our stockholders for approval, including

the election of directors and any sale, merger, consolidation, or sale of all or substantially all of our assets.

The concentration of

voting power among one or more of these stockholders may have an adverse effect on the price of our common stock.

The existing holdings of

our directors and executive officers is in the aggregate, approximately 18.7% of our outstanding common stock as of the date of this annual

As a result, these stockholders may be able to influence our management and affairs and control the outcome of matters submitted

to our stockholders for approval, including the election of directors and any sale, merger, consolidation, or sale of all or substantially

all of our assets.

The concentration of voting power among one or more of these stockholders may have an adverse effect on the price of

our common stock.

In addition, this concentration

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and fluctuate substantially and rapidly, which could result in the loss of a significant part of your investment.

The market price of our

common stock may fluctuate substantially and rapidly and may be higher or lower than the public offering price.

The stock market, in

general, and the market for smaller companies such as ours, in particular, have experienced extreme price and volume fluctuations.

volatility, including any stock-run up, may be unrelated or disproportionate to the actual or expected operating performance and financial

condition or prospects of those companies, making it difficult for the investors to assess the rapidly changing value of our common stock.

These fluctuations may be even more pronounced in the trading market for our common stock shortly following the listing of our common

stock on Nasdaq as a result of the limited public float available following the IPO.

The market price for our common stock may be

influenced by many factors, including:

● limited trading

● our success in

commercializing our products;

● developments with

respect to competitive products or technologies;

● developments or

disputes concerning patent applications, issued patents or other intellectual property or

proprietary rights;

● the recruitment

or departure of key personnel;

● actual or anticipated

changes in estimates as to financial results, commercialization timelines or recommendations

by securities analysts;

● variations in

our financial results or the financial results of companies that are perceived to be similar

● sales of common

stock by us, our executive officers, directors or principal stockholders or others;

● general economic,

industry and market conditions, such as the impact of the COVID-19 pandemic on our industry;

● the publication

of unfavorable research reports and updates thereto by financial analysts;

● the other factors

described in this “Risk Factors” section.

The market price of our common

stock may fluctuate substantially and rapidly and may be higher or lower than the public offering price.

The stock market, in general,

and the market for smaller companies such as ours, in particular, have experienced extreme price and volume fluctuations.

Such volatility,

including any stock-run up, may be unrelated or disproportionate to the actual or expected operating performance and financial condition

or prospects of those companies, making it difficult for the investors to assess the rapidly changing value of our common stock.

fluctuations may be even more pronounced in the trading market for our common stock shortly following the listing of our common stock

on Nasdaq as a result of the limited public float available following the IPO.

The market price for our common stock may be influenced

by many factors, including:

limited trading volume;

our success in commercializing our products;

developments with respect to competitive products or technologies;

developments or disputes concerning patent applications, issued patents or other intellectual property or proprietary rights;

the recruitment or departure of key personnel;

actual or anticipated changes in estimates as to financial results, commercialization timelines or recommendations by securities analysts;

variations in our financial results or the financial results of companies that are perceived to be similar to us;

sales of common stock by us, our executive officers, directors or principal stockholders or others;

general economic, industry and market conditions, such as the lasting effects of the COVID-19 pandemic on our industry;

the publication of unfavorable research reports and updates thereto by financial analysts;

the other factors described in this “Risk Factors” section.

In the past, many companies

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being a publicly traded company.

As a company with publicly traded securities,

we incur additional legal, accounting and other expenses not presently incurred.

In addition, the Sarbanes-Oxley Act of 2002, the Dodd-Frank

Wall Street Reform and Consumer Protection Act of 2010, as well as rules promulgated by the SEC and the national securities exchange

on which we list, requires us to adopt corporate governance practices applicable to U.S.

As a company with publicly

traded securities, we incur additional legal, accounting and other expenses not presently incurred.

In addition, the Sarbanes-Oxley Act

of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as well as rules promulgated by the SEC and the national

securities exchange on which we list, requires us to adopt corporate governance practices applicable to U.S.

public companies.

These rules and regulations

will increase our legal and financial compliance costs.

and regulations will increase our legal and financial compliance costs.

If securities or industry analysts do not

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and trading volume could decline.

The trading market for our common stock will

be influenced by the research and reports that industry or securities analysts publish about us, our industry and our market.

If no analyst

elects to cover us and publish research or reports about us, the market for our common stock could be severely limited and our stock

price could be adversely affected.

As a small-cap company, we are more likely than our larger competitors to lack coverage from securities

In addition, even if we receive analyst coverage, if one or more analysts ceases coverage of us or fails to regularly publish

reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

If one or more analysts who elect to cover us issue negative reports or adversely change their recommendations regarding our common stock,

our stock price could decline.

The trading market for our

common stock will be influenced by the research and reports that industry or securities analysts publish about us, our industry and our

If no analyst elects to cover us and publish research or reports about us, the market for our common stock could be severely limited

and our stock price could be adversely affected.

As a small-cap company, we are more likely than our larger competitors to lack coverage

from securities analysts.

In addition, even if we receive analyst coverage, if one or more analysts ceases coverage of us or fails to

regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading

volume to decline.

If one or more analysts who elect to cover us issue negative reports or adversely change their recommendations regarding

our common stock, our stock price could decline.

We are an “emerging growth company”

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of Section 404(b) of the Sarbanes-Oxley Act, (2) we will be exempt from any rules that may be adopted by the PCAOB requiring

mandatory audit firm rotations or a supplement to the auditor’s report on financial statements, (3) we will be subject to

reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and (4) we will not

be required to hold nonbinding advisory votes on executive compensation or stockholder approval of any golden parachute payments not

previously approved.

mandatory audit firm rotations or a supplement to the auditor’s report on financial statements, (3) we will be subject to reduced

disclosure obligations regarding executive compensation in our periodic reports and proxy statements and (4) we will not be required

to hold nonbinding advisory votes on executive compensation or stockholder approval of any golden parachute payments not previously approved.

We will take advantage of these exemptions.

In addition, an emerging growth company may take advantage of the extended

transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the “Securities

Act”) for complying with new or revised accounting standards, meaning that the company can delay the adoption of certain accounting

standards until those standards would otherwise apply to private companies.

We have elected to avail ourselves of this exemption from

new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards as other public

companies that are not emerging growth companies.

In addition, an emerging growth company may take advantage of the extended transition period

provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the “Securities Act”) for complying

with new or revised accounting standards, meaning that the company can delay the adoption of certain accounting standards until those

standards would otherwise apply to private companies.

We have elected to avail ourselves of this exemption from new or revised accounting

standards and, therefore, we will not be subject to the same new or revised accounting standards as other public companies that are not

emerging growth companies.

We may remain an “emerging

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and, even if we no longer qualify as an emerging growth company, we may still be subject to reduced reporting requirements.

We are a “smaller

reporting company” as defined in the Securities Exchange Act of 1934, as amended.

Smaller reporting companies may

choose to present only the two most recent fiscal years of audited financial statements in their annual reports on Form 10-K

and have reduced disclosure obligations regarding executive compensation and, if a smaller reporting company has less than $100 million

in annual revenue, it would not be required to obtain an attestation report on internal control over financial reporting issued by its

independent registered public accounting firm.

We will remain a smaller reporting company until the last day of any fiscal year

for so long as either:

(i) the market value of our shares of common stock held by non-affiliates does not equal or exceed $250 million

measured on the last business day of our second fiscal quarter;

or (ii) our annual revenues is less than $100 million

during the most recently completed fiscal year and the market value of our common stock held by non-affiliates is less than $700 million

measured on the last business day of our second fiscal quarter.

To the extent we take advantage of such reduced disclosure obligations,

it may make the comparison of our financial statements with other public companies difficult or impossible.

We may issue shares of preferred stock

in the future, which could make it difficult for another company to acquire us or could otherwise adversely affect holders of our common

We are a “smaller reporting

company” as defined in the Securities Exchange Act of 1934, as amended.

Smaller reporting companies may choose to

present only the two most recent fiscal years of audited financial statements in their annual reports on Form 10-K and have

reduced disclosure obligations regarding executive compensation and, if a smaller reporting company has less than $100 million in

annual revenue, it would not be required to obtain an attestation report on internal control over financial reporting issued by its independent

registered public accounting firm.

We will remain a smaller reporting company until the last day of any fiscal year for so long as

(i) the market value of our shares of common stock held by non-affiliates does not equal or exceed $250 million measured

on the last business day of our second fiscal quarter;

or (ii) our annual revenues is less than $100 million during the

most recently completed fiscal year and the market value of our common stock held by non-affiliates is less than $700 million measured

on the last business day of our second fiscal quarter.

To the extent we take advantage of such reduced disclosure obligations, it

may make the comparison of our financial statements with other public companies difficult or impossible.

We may issue shares of preferred stock in

the future, which could make it difficult for another company to acquire us or could otherwise adversely affect holders of our common

stock, which could depress the price of our common stock.

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dividend and other rights superior to the rights of our common stock.

The potential issuance of preferred stock may delay or prevent

a change in control of us, discouraging bids for our common stock at a premium to the market price, and materially adversely affect the

The potential issuance of preferred stock may delay or prevent a

change in control of us, discouraging bids for our common stock at a premium to the market price, and materially adversely affect the

market price and the voting and other rights of the holders of our common stock.

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paid any cash dividends or distributions on our capital stock.

We currently intend to retain our future earnings, if any, to support

operations and to finance expansion and therefore we do not anticipate paying any cash dividends on our common stock in the foreseeable

We currently intend to retain our future earnings, if any, to support operations

and to finance expansion and therefore we do not anticipate paying any cash dividends on our common stock in the foreseeable future.

The declaration, payment

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with respect to the amount of any such dividend.

As a result, investors will be reliant upon capital appreciation for any returns on

their investment in the shares of our common stock.

As a result, investors will be reliant upon capital appreciation for any returns on their

investment in the shares of our common stock.

Future sales of our common stock in the

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As of July 23, 2026, there

are 3,432,000shares of restricted common stock, which constitute approximately 32.3% of our outstanding common stock, may be eligible

for sale pursuant to Rule 144 at various times, subject to limitations provided by Rule 144 and lock-up agreements which our stockholders,

including our directors and officers, who hold 3,366,000shares have signed lock-ups for period of 180 days from the closing of the registered

direct offering, which expires on December 1, 2025, release from the lock-up restriction at the discretion of the placement agent for

the registered direct offering.

If placement agent for the registered direct offering waives or releases parties to the lock-up, the

market price for our common stock could be adversely impacted.

are 77,000 shares of restricted common stock, which constitute approximately 4.717% of our outstanding common stock, may be eligible for

sale pursuant to Rule 144 at various times, subject to limitations provided by Rule 144.

If placement agent for the registered direct

offering waives or releases parties to the lock-up, the market price for our common stock could be adversely impacted.

We intend to file a registration

statement with the SEC on Form S-8 providing for the registration of shares of our common stock issued or reserved for issuance

under our equity incentive plan or pursuant to stock options.

Subject to the satisfaction of vesting conditions and the expiration of

lock-up agreements, shares registered under the registration statement on Form S-8 will be available for resale immediately in the

public market without restriction other than those restrictions imposed on sales by affiliates pursuant to Rule 144.

statement with the SEC on Form S-8 providing for the registration of shares of our common stock issued or reserved for issuance under

our equity incentive plan or pursuant to stock options.

Subject to the satisfaction of vesting conditions and the expiration of lock-up

agreements, shares registered under the registration statement on Form S-8 will be available for resale immediately in the public

market without restriction other than those restrictions imposed on sales by affiliates pursuant to Rule 144.

We cannot predict the size

of future issuances of our common stock or securities convertible into common stock or the effect, if any, that future issuances and

sales of shares of our common stock will have on the market price of our common stock.

Sales of substantial amounts of our common stock

(including shares issued in connection with any acquisition we may make), or the perception that such sales, including sales by our existing

stockholders pursuant to Rule 144, could occur, may adversely affect prevailing market prices of our common stock.

Because our directors and executive officers

own or have the right to vote approximately 18.7% of our outstanding common stock, they may be able to elect all directors, approve

all matters requiring stockholder approval and block any action which may be beneficial to stockholders.

As of July 15, 2025, our

directors and executive officers beneficially own approximately 18.7% of our outstanding common stock.

Our bylaws provide that a majority

of the aggregate voting power of the stock issued and outstanding and entitled to vote constitutes a quorum for a meeting of stockholders.

As a result, they may have the ability to elect all of our directors and to approve actions requiring stockholder approval as well as

to prevent any action from being taken which they oppose even if such action would benefit stockholders.

of future issuances of our common stock or securities convertible into common stock or the effect, if any, that future issuances and sales

of shares of our common stock will have on the market price of our common stock.

Sales of substantial amounts of our common stock (including

shares issued in connection with any acquisition we may make), or the perception that such sales, including sales by our existing stockholders

pursuant to Rule 144, could occur, may adversely affect prevailing market prices of our common stock.

Delaware law and provisions in our amended

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provisions include the following:

● establish a classified

board of directors so that not all members of our board of directors are elected at one time;

● permit the board

of directors to establish the number of directors and fill any vacancies and newly-created

directorships;

● provide that directors

may only be removed for cause;

● require super-majority

voting to amend some provisions in our bylaws;

● prohibit stockholder

action by written consent, which requires all stockholder actions to be taken at a meeting

of the stockholders;

● provide that the

board of directors is expressly authorized to amend or repeal our bylaws;

● restrict the forum

for certain litigation against the Company to Delaware;

● establish advance

notice requirements for nominations for election to our board of directors or for proposing

matters that can be acted upon by stockholders at annual stockholder meetings.

establish a classified board of directors so that not all members of our board of directors are elected at one time;

permit the board of directors to establish the number of directors and fill any vacancies and newly-created directorships;

provide that directors may only be removed for cause;

require super-majority voting to amend some provisions in our bylaws;

prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of the stockholders;

provide that the board of directors is expressly authorized to amend or repeal our bylaws;

restrict the forum for certain litigation against the Company to Delaware;

establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.

Any provision of our amended

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affect the price that some investors are willing to pay for our common stock.

Our management is required to devote a

substantial amount of time to comply with public company regulations.

As a public company, we

incur significant legal, accounting and other expenses that we did not incur as a private company.

The Sarbanes-Oxley Act, the Dodd-Frank

Wall Street Reform and Consumer Protection Act as well as rules implemented by the SEC and Nasdaq, impose various requirements on public

companies, including those related to corporate governance practices.

Our management and other personnel will need to devote a substantial

amount of time to these requirements.

Our management is required to devote a substantial

amount of time to comply with public company regulations.

As a public company, we incur

significant legal, accounting and other expenses that we did not incur as a private company.

The Sarbanes-Oxley Act, the Dodd-Frank Wall

Street Reform and Consumer Protection Act as well as rules implemented by the SEC and Nasdaq, impose various requirements on public companies,

including those related to corporate governance practices.

Our management and other personnel will need to devote a substantial amount

of time to these requirements.

Certain members of our management do not have significant experience in addressing these requirements.

Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming

Among other things, our

management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and

15d-15(f) under the Securities Exchange Act of 1934, as amended, or the Exchange Act.

Our compliance with these

requirements will require that it incur substantial accounting and related expenses and expend significant management efforts.

need to hire additional accounting and financial staff to comply with public company regulations.

The costs of hiring such staff may

be material and there can be no assurance that such staff will be immediately available to us.

Among other things, our management is responsible

for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under

the Securities Exchange Act of 1934, as amended, or the Exchange Act.

Our compliance with these requirements will

require that it incur substantial accounting and related expenses and expend significant management efforts.

We will need to hire additional

accounting and financial staff to comply with public company regulations.

The costs of hiring such staff may be material and there can

be no assurance that such staff will be immediately available to us.

Moreover, because we have

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be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

There can be no assurance that we will

be able to comply with the continued listing standards of Nasdaq.

We are subject to an

SEC investigation, which could adversely affect our business, financial condition, results of operations and stock price.

On January 21, 2026, the

Company was notified by the U.S.

Securities and Exchange Commission (the “Commission”) that it has initiated an investigation

involving the Company.

The Company has not been provided with substantive details regarding the investigation, and is fully cooperating

with the investigation.

SEC investigations can be lengthy, expensive and disruptive.

We have incurred and may continue to incur significant

legal and other expenses in connection with the investigation.

Management’s attention may be diverted from other business concerns,

which could have a material adverse effect on our business, financial condition and results of operations.

We cannot predict the timing,

outcome or consequences of the investigation.

If the SEC were to determine that we have violated federal securities laws, we could be

subject to civil or criminal sanctions, including monetary penalties, cease and desist orders, injunctions or other equitable relief.

Any such sanctions or the continuation of the investigation could have a material adverse effect on our business, reputation, financial

condition and the market price of our common stock.

We are subject to a

securities class action lawsuit and may be subject to similar litigation in the future, which could adversely affect our business, financial

condition, results of operations and stock price.

On September 8, 2025, a federal

securities class action was filed against the Company, our chief executive officer, and our former chief financial officer in the United

States District Court, Eastern District of New York.

The complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange

Act of 1934 and Rule 10b-5 thereunder, claiming that defendants made materially false and misleading statements about revenue growth,

brand reputation, and business expansion, while concealing or minimizing material adverse facts concerning the safety of the Company’s

lithium battery and inadequate forecasting processes.

Securities litigation is often expensive and diverts management’s attention

and Company resources.

There can be no assurance that we will prevail in this action.

An unfavorable outcome in this or similar litigation

could result in substantial monetary damages, and could have a material adverse effect on our business, financial condition, results of

operations and the market price of our common stock.

In addition, the SEC investigation and the class action litigation, whether or not

resolved in our favor, could result in substantial costs, divert management’s attention and resources, cause us reputational harm,

and make it more difficult for us to raise capital or attract and retain qualified personnel.

On May 22, 2026, the lead

plaintiff in the Class Action filed an Amended Complaint.

The Company's response to the Amended Complaint is due August 14, 2026.

the preliminary stage of the lawsuit and the inherent uncertainties of litigation, the Company cannot determine with certainty the outcome

of the Class Action at this time.

There can be no assurance that we will be

able to comply with the continued listing standards of Nasdaq.

Our eligibility for listing

on Nasdaq depends on our ability to comply with Nasdaq’s continued listing requirements.

On October 2, 2024, we received written

notice from Nasdaq indicating that the bid price for our common stock for the last 31 consecutive business days, had closed below

the minimum $1.00 per share and, as a result, we are not in compliance with the $1.00 minimum bid price requirement for the continued

listing on Nasdaq, as set forth in Nasdaq Listing Rule 5550(a)(2).

In accordance with Nasdaq

Listing Rule 5810(c)(3)(A), we have a period of 180 calendar days, or until March 31, 2025, to regain compliance with

the minimum bid price requirement.

To regain compliance, the closing bid price of our common stock must meet or exceed $1.00 per share

for a minimum of 10 consecutive business days during this 180 day period.

On April 2, 2025, Nasdaq notified us that, although

the Company has not regained compliance with the minimum bid price requirement, the Company is eligible to receive an additional 180

calendar day period or until September 29, 2025, to regain compliance with the minimum bid price requirement, pursuant to Nasdaq

Listing Rule 5810(c)(3)(A).

We will monitor the closing bid price of our common stock and may, if appropriate, consider implementing

available options, including, but not limited to, implementing a reverse share split of our common stock, to regain compliance with the

minimum bid price requirement under the Nasdaq Listing Rules.

On June 16, 2025, our board of directors approved a one-for-five (1:5)

reverse stock split of our issued and outstanding shares of common stock.

On July 3, 2025, we filed with the Secretary of State of the

State of Delaware a Certificate of Amendment to our Certificate of Incorporation to effect the 2025 Reverse Stock Split.

The 2025 Reverse

Stock Split became effective on July 3, 2025, and our common stock began trading on a split-adjusted basis on Nasdaq on July 7, 2025.

However, there can be no assurance that we will be able to regain such compliance.

On April 17, 2026, the Company received

a letter from the Listing Qualifications Staff (the “Staff”) of Nasdaq notifying the Company that it currently does not satisfy

Listing Rule 5620(a), which requires listed companies to hold an annual meeting of shareholders within twelve months of the end of their

The Company did not hold an annual meeting of shareholders within twelve months of its fiscal year ended March 31, 2025.

The Deficiency Letter is only a notification of deficiency, not of imminent delisting, and has no immediate effect on the listing or trading

of the Company’s securities on the Nasdaq Capital Market.

The Deficiency Letter states that the Company has 45 calendar days, or

until June 1, 2026, to submit to Nasdaq a plan to regain compliance with the Nasdaq Listing Rule 5620(a).

If the Company submits a plan

to Nasdaq and Nasdaq accepts the plan, Nasdaq can grant an exception of up to 180 calendar days from the fiscal year end, or until September

28, 2026, to regain compliance.

If Nasdaq does not accept the Company’s plan, the Company will have the opportunity to appeal the

decision to a Nasdaq Hearings Panel.

The Company filed the proxy

for its 2026 annual general meeting (“2026 AGM”) on May 26, 2026 and the 2026 AGM was held on June 17, 2026.

Staff has determined that the Company complies with the Listing Rule 5620(a) and this matter is now closed.

On July 21, 2026, the Company received a delinquency notification letter (the “Notice”) from the Listing Qualifications Staff

of Nasdaq due to the Company’s non-compliance with Nasdaq Listing Rule 5250(c)(1) as a result of the Company’s failure to

timely file its Annual Report on Form 10-K for the period ended March 31, 2026.

Nasdaq Listing Rule 5250(c)(1) requires listed companies

to timely file all required periodic financial reports with the SEC.

This Notice has no immediate effect on the listing of the Company’s

securities on Nasdaq.

However, if the Company fails to timely regain compliance with the Rule, the Company’s securities will be

subject to delisting from Nasdaq.

The Notice provides that the Company may submit to Nasdaq a plan to regain compliance with the Nasdaq

Listing Rule by September 21, 2026.

If Nasdaq accepts the Company’s plan, then Nasdaq may grant the Company up to 180 calendar days

from the filing’s due date, or until January 11, 2027, to regain compliance.

If Nasdaq does not accept the Company’s plan,

then the Company will have the opportunity to appeal that decision to a Nasdaq Hearings Panel.

There can be no assurance that the Company

will be able to regain compliance with the Nasdaq Listing Rule 5250(c)(1) or maintain compliance with any other continued listing requirements.

If Nasdaq delists our common

stock from trading on its exchange, we and our stockholders could face significant material adverse consequences including:

● limited availability

of market quotations for our securities;

● a determination

that our common stock is a “penny stock,” which will require brokers trading

in our common stock to adhere to more stringent rules, possibly resulting in a reduced level

of trading activity in the secondary trading market for our common stock;

● a limited amount

of analyst coverage;

● decreased ability

to issue additional securities or obtain additional financing in the future.

limited availability of market quotations for our securities;

a determination that our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our common stock;

a limited amount of analyst coverage;

decreased ability to issue additional securities or obtain additional financing in the future.

FINRA sales practice requirements may limit

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stock issuable upon exercise of the Warrants.

Upon exercise of the Warrants, the holder will be entitled to exercise the rights of a

common stockholder as to the security exercised only as to matters for which the record date occurs after the exercise.

Upon exercise of the Warrants, the holder will be entitled to exercise the rights of a common

stockholder as to the security exercised only as to matters for which the record date occurs after the exercise.

If securities or industry analysts do not

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more favorable relative recommendations about our competitors, our stock price would likely decline.

If any analyst who may cover us

were to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets,

which in turn could cause our stock price or trading volume to decline.

If any analyst who may cover us were

to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which

in turn could cause our stock price or trading volume to decline.

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-K

Item 1A. Risk Factors