What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-05-13 compared with 2024-11-19 · 330 added, 474 removed, 225 unchanged (78% of the section changed)

76 unchanged sentences

it received another approval from the Shouguang Yangkou People’s Government dated on March 5, 2020 to resume production at its bromine

factories No.

factories No.1, No.

4, No.7 and No.

9 in order to meet the needs of bromide products for epidemic prevention and control.

two approvals, the Company was allowed to resume production at all four bromine factories.

With these two

approvals, the Company was allowed to resume production at all four bromine factories.

The Company received

2 unchanged sentences

No.8 started to contribute revenue in the fourth quarter 2022.

Pursuant to the notification

from the government of Shouguang City, all bromine facilities in Shouguang City were temporarily closed from December 10, 2022 until February

To comply with such notification, the Company had temporarily stopped production at its bromine facilities during the aforesaid

period and reopened the operating bromine and crude salt factories in February, 2023.

The Company is still

waiting for governmental approval for factories No.

waiting for governmental approval for factories No.2 and No.10.

To its knowledge, the government is currently completing its planning

1 unchanged sentence

As a result, the Company may be required to make some modifications

to our current wells and aqueducts prior to commencement of operations of these factories in order to satisfy the local government's requirements.

On November 24, 2017, Gulf Resources received a letter from the People’s

Government of Yangkou County, Shouguang City notifying the Company that due to the new standards and regulations relating to safety production

and environmental pollution, from certain local governmental departments, such as the municipal environmental protection department, the

security supervision department and the fire department, its chemical enterprises would have to be relocated to a new industrial park

called Bohai Marine Fine Chemical Industry Park.

Although our chemical companies were in compliance with regulations, they

were also close to a residential area.

As a result, the government determined we should relocate to the Bohai park.

Chemical companies

that are not being asked to move into the park are being permanently closed.

Since our factories closed, the Company has secured

from the government the land use rights for its chemical plant.

On January 6, 2020, the Company received the environmental protection

approval by the government of Shouguang City, Shandong Province for the proposed Yuxin Chemical factory.

The Company began the construction

on its new chemical facilities located at Bohai Marine Fine Chemical Industrial Park in June 2020.

The construction was expected to take

approximately one year and an additional six months to complete the equipment installation and testing, however due to the COVID epidemic

and electrical restrictions, the opening of the chemical factory has been delayed.

The Company has received the refrigeration and

air compressor units.

On July 26, 2023, the Company announced that the delivery of the remaining equipment for its Yuxin chemical factory

has been temporarily delayed and the Company will re-evaluate its chemical products strategy.

to our current wells and aqueducts prior to commencement of operations of these factories to satisfy the local government's requirements.

On November 24, 2017, Gulf Resources received a letter from the People’s Government of Yangkou County, Shouguang City notifying

the Company that due to the new standards and regulations relating to safety production and environmental pollution, from certain local

governmental departments, such as the municipal environmental protection department, the security supervision department and the fire

department, its chemical enterprises would have to be relocated to a new industrial park called Bohai Marine Fine Chemical Industry Park.

Although our chemical companies were in compliance with regulations, they were also close to a residential area.

As a result, the government

determined we should relocate to the Bohai park.

Chemical companies that are not being asked to move into the park are being permanently

Since our factories closed, the Company has secured from the government the land use rights for its chemical plant.

6, 2020, the Company received the environmental protection approval by the government of Shouguang City, Shandong Province for the proposed

Yuxin Chemical factory.

The Company began the construction on its new chemical facilities located at Bohai Marine Fine Chemical Industrial

Park in June 2020.

The construction was expected to take approximately one year and an additional six months to complete the equipment

installation and testing, however due to the COVID epidemic and electrical restrictions, the opening of the chemical factory has been

The Company has received the refrigeration and air compressor units.

The company decided to delay the delivery of the rest undelivered

equipment and the opening of the factory until financial conditions in China improved and until it had visibility as to which products

would produce the best returns.

In January 2017, the

4 unchanged sentences

gas and brine water project, and approvals for safety production inspection, environmental protection assessment, and to solve the related

Until these approvals have been received, the Company has to temporarily halt trial production at its natural gas well in

In compliance with the Chinese government new policies, the Company is also required to obtain an exploration license and a mining

license for bromine and natural gas, respectively.

Pursuant to the Opinions of the Ministry of Natural Resources on Several Issues in

Promoting the Reform of Mineral Resources Management (Trial) promulgated by the Ministry of Natural Resources of PRC on January 9, 2020,

Until these approvals have been received, the Company has had to temporarily halt trial production at its natural gas well

In compliance with the Chinese government new policies, the Company is also required to obtain an exploration license and a

mining license for bromine and natural gas, respectively.

Pursuant to the Opinions of the Ministry of Natural Resources on Several Issues

in Promoting the Reform of Mineral Resources Management (Trial) promulgated by the Ministry of Natural Resources of PRC on January 9,

2020, which came into effect on May 1, 2020, privately owned enterprises are allowed to participate in the natural gas production.

plans to proceed with its applications for the natural gas and brine project approvals with related government departments until after

the governmental planning has been finalized the land and resource planning for Sichuan Province.

Company plans to proceed with its applications for the natural gas and brine project approvals with related government departments after

the governmental planning has finalized the land and resource planning for Sichuan Province.

In April 2022, Shouguang Hengde Salt Industry

Ltd （ “SHSI” ） ,

our subsidiary, was incorporated in Shandong Province, China, for crude salt production and trading.

On January 28, 2020 we completed a 1-for-5 reverse

stock split of our common stock, such that for each five shares outstanding prior to the stock split there was one share outstanding after

the reverse stock split.

All shares of common stock referenced in this report have been adjusted to reflect the stock split

Recent Developments

Ltd（“SHSI”）, our subsidiary, was incorporated in Shandong Province, China, for crude salt production and

On January 28, 2020 we

completed a 1-for-5 reverse stock split of our common stock, such that for each five shares outstanding prior to the stock split there

was one share outstanding after the reverse stock split.

All shares of common stock referenced in this report have been adjusted

to reflect the stock split figures.

Acquisition Agreements

On June 26, 2024, a wholly owned subsidiary of

the Company, Shouguang Hengde Salt Industry Co.

Ltd ( “SHSI”), entered into a Crude Salt Field Acquisition Agreement (the

“Acquisition Agreement”) with Shouguang Qingshuibo Farm Co., LTD.

(“Seller A”), pursuant to which Seller A agrees

to transfer to SHSI, and SHSI agrees to purchase, 2,380,000 square meters of crude salt field (including the land lease fee) for RMB54.40

per square meter, with the total transfer price of RMB129,472,000.

In June 2024, a wholly owned

subsidiary of the Company, Shouguang Hengde Salt Industry Co.

Ltd ( “SHSI”) entered into crude salt field acquisition agreements

with Shouguang Qingshuibo Farm Co., LTD.

(“Seller A”), Shouguang city Yangkou town Dingjia Zhuangzi village stock economic

cooperative (“Seller B”), Shouguang city Yangkou town Shanjia Zhuangzi village stock economic cooperative (“Seller C”),

Shouguang City Yangkou town Zhengjia Zhuangzi village stock economic cooperative (“Seller D”), and Shouguang city Yangkou

town Renjia Zhuangzi village stock economic cooperative (“Seller E”), respectively, as amended in December 2024.

of these agreements are set forth below:

On June 26, 2024, SHSI entered

into an acquisition agreement with Seller A, pursuant to which Seller A agrees to transfer to SHSI, and SHSI agrees to purchase, 2,380,000

square meters of crude salt field (including the land lease fee) for RMB54.40 per square meter, with the total transfer price of RMB129,472,000.

The term of transfer is from June 29, 2024 to June 28, 2044.

the transfer price shall be paid upon the execution of Acquisition Agreement, and the remaining 20% shall be paid in shares of common

stock of the Company within three months from the date of Acquisition Agreement after SHSI has inspected the and accepted the crude salt

field in writing.

On June 27, 2024, SHSI entered into four Crude

Salt Field Acquisition Agreements (the “Agreements”) with Shouguang city Yangkou town Dingjia Zhuangzi village stock economic

cooperative, Shouguang city Yangkou town Shanjia Zhuangzi village stock economic cooperative, Shouguang City Yangkou town Zhengjia Zhuangzi

village stock economic cooperative, and Shouguang city Yangkou town Renjia Zhuangzi village stock economic cooperative (together, “Sellers”),

pursuant to which Sellers agree to transfer to SHSI, and SHSI agrees to purchase from Sellers, 750,000, 804,000, 385,000, and 822,000

square meters of crude salt field (including the land lease fee) for RMB54.10, RMB54.90, RMB54.00, and RMB55.70 per square meter, respectively,

with the total transfer price of RMB40,575,000, RMB44,139,600, RMB20,790,000, and RMB45,785,400, respectively.

The term of transfers is

from June 29, 2024 to June 28, 2044.

80% of the transfer price shall be paid upon the execution of Agreements, and the remaining 20% shall

be paid in shares of common stock of the Company within three months from the date of Agreements after SHSI has inspected the and accepted

the crude salt fields in writing.

80% of the transfer price shall be paid upon the execution of the agreement,

and the remaining 20% shall be paid in shares of common stock of the Company within three months from the date of the agreement after

SHSI has inspected the and accepted the crude salt field in writing.

Subsequently,

on December 17, 2024, the parties entered into an amendment to the agreement, pursuant to which the Article 2.

2 of the agreement has

been amended as follows:

eighty percent (80%) of the total amount, equaling RMB103,577,600 had been paid on the date of signing the contract

by both parties.

The remaining RMB25,894,400 shall be paid in a combination of common stock of the Company and cash as follows:

(1) RMB10,357,800

shall be paid in shares, calculated on a per share price of US$1.5, using the exchange rate RMB/US$:7.27.

These shares shall be issued

by the Company to Seller A or Seller A's designated parties within three months after SHSI has inspected and accepted the crude salt field

(2) the balance shall be paid in cash before December 31, 2028.

On June 27, 2024, SHSI entered

into an acquisition agreement with each Seller B, Seller C, Seller D and Seller E, respectively, pursuant to which the sellers agreed

to transfer to SHSI, and SHSI agrees to purchase from the sellers, 750,000, 804,000, 385,000, and 822,000 square meters of crude salt

field (including the land lease fee) for RMB54.10, RMB54.90, RMB54.00, and RMB55.70 per square meter, respectively, with the total transfer

price of RMB40,575,000, RMB44,139,600, RMB20,790,000, and RMB45,785,400, respectively.

The term of transfers is from June 29, 2024 to

June 28, 2044.

80% of the transfer price shall be paid upon the execution of the agreements, and the remaining 20% shall be paid in shares

of common stock of the Company within three months from the date of the agreements after SHSI has inspected the and accepted the crude

salt fields in writing.

December 17, 2024, SHSI entered into an amendment to the acquisition agreement with Seller B, pursuant to which the Article 2.

agreement has been amended as follows:

(80%) of the total amount, equaling RMB32,460,000 had been paid on the date of signing the contract

by both parties.

The remaining RMB8,115,000 shall be paid in a combination of common stock of the Company and cash as follows:

(1) RMB3,246,000

shall be paid in shares, calculated on a per share price of US$1.5, using the exchange rate RMB/US$:7.27.

These shares shall be issued

by the Company to Seller B or Seller B’s designated parties within three months after SHSI has inspected and accepted the crude

salt field in writing;

(2) the balance shall be paid in cash before December 31, 2028.

17, 2024, SHSI entered into an amendment to the acquisition agreement with Seller C, pursuant to which the Article 2.

2 of the agreement

has been amended as follows:

Eighty percent (80%) of the total amount, equaling RMB35,311,680 had been paid on the date of signing the

contract by both parties.

The remaining RMB8,827,920 shall be paid in a combination of common stock of the Company and cash as follows:

(1) RMB3,531,168 shall be paid in shares, calculated on a per share price of US$1.5 per, using the exchange rate RMB/US$:7.27.

shall be issued by the Company to Seller C or Seller C's designated parties within three months after SHSI has inspected and accepted

the crude salt field in writing;

(2) the balance shall be paid in cash before December 31, 2028.

December 17, 2024, SHSI entered into an amendment to the acquisition agreement with Seller D, pursuant to which the Article 2.

agreement has been amended as follows:

Eighty percent (80%) of the total amount, equaling RMB 16,632,000 had been paid on the date of

signing the contract by both parties.

The remaining RMB 4,158,000 shall be paid in a combination of common stock of the Company and cash

(1) RMB1,663,200 shall be paid in shares, calculated on a per share price ofUS$1.5, using the exchange rate RMB/US$:7.27.

These shares shall be issued by the Company to Seller D or Seller D's designated parties within three months after SHSI has inspected

and accepted the crude salt field in writing;

(2) the balance shall be paid in cash before December 31, 2028.

17, 2024, SHSI entered into an amendment to the acquisition agreement with Seller E, pursuant to which the Article 2.

2 of the agreement

has been amended as follows:

Eighty percent (80%) of the total amount, equaling RMB36,628,320 had been paid on the date of signing the

contract by both parties.

The remaining RMB9,157,080 shall be paid in a combination of common stock of the Company and cash as follows:

(1) RMB3,662,832 shall be paid in shares, calculated on a per share price of US$1.5, using the exchange rate RMB/US$:7.27.

shall be issued by the Company to Seller E or Seller E's designated party within three months after SHSI has inspected and accepted the

crude salt field in writing;

(2) the balance shall be paid in cash by SHSI to Seller E before December 31, 2028.

In accordance

to each amendment, the parties also acknowledged and agreed that, in compliance with the Nasdaq Listing Rule 5635, the issuance of shares

pursuant to the agreement may not exceed 19.9% of the total outstanding shares of common stock of the Company prior to the issuance of

the shares (the “19.9% Threshold”), unless such issuance is approved by the shareholders of the Company in accordance with

the Nasdaq rules and regulations.

SHSI shall cause the Company to take all necessary steps to obtain such shareholder approval if the

issuance of shares under the agreement exceeds the 19.9% Threshold.

30, 2024, SHSI and each of the sellers mutually acknowledged and confirmed that the salt land provided by each seller meets the acquisition

criteria, is in the anticipated usable condition, and has been accepted and handed over to SHSI.

Recent Developments

Nasdaq Compliance

The Company received a notice (the “Initial

Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) on April 18, 2024 notifying

the Company that due to the Company’s failure to timely file its Annual Report on Form 10-K for the fiscal year ended December 31,

2023 (the “Form 10-K”), with the SEC, the Company is not in compliance with Nasdaq’s continued listing requirements

under Nasdaq Listing Rule 5250(c)(1) (the “Rule”), which requires the timely filing of all required periodic reports with

the SEC, and the Company subsequently received a notice (the “May Notice”) from Nasdaq on May 21, 2024 due to the Company’s

non-compliance with the Rule as a result of the Company’s failure to timely file its Quarterly Report on Form 10-Q for the fiscal

quarter ended March 31, 2024 (the “Form 10-Q”, together with the Form 10-K, the “Delinquent Reports”).

May Notice states that the Company has until June 17, 2024 to submit to Nasdaq a plan to regain compliance with the Rule.

On June 26, 2024, the Company received a letter

from Nasdaq indicating that, based on its further review and the plan of compliance submitted by the Company on June 14, 2024, Nasdaq

has determined to grant an exception to enable the Company to regain compliance with the Rule.

The terms of the exception were as follows:

on or before October 14, 2024, the Company must file the Delinquent Reports, as required by the Rule.

In the event the Company does not

satisfy the terms, Nasdaq will provide written notification that its securities will be delisted.

At that time, the Company may appeal

Nasdaq’s determination to a hearings panel.

Subsequently, on August 20, 2024, the Company

received a notice (the “August Notice”) from Nasdaq indicating that, because the Company is delinquent in filing its quarterly

report on Form 10-Q for the period ended June 30, 2024, the Company was not in compliance with the Rule.

The Notice also indicates that

as a result of this additional delinquency, the Company must submit an update to its original plan to regain compliance with respect to

the filing requirements.

The Company has until September 4, 2024 to submit such update to Nasdaq.

On October 15, 2024, the Company received

written notice from the Staff that, as a result of the Company filing the Delinquent Filings with the SEC, the Staff has determined that

the Company complies with the Rule and considers the matter to be closed.

On November 5, 2024, the Company received

a notice in the form of a letter (“Price Deficiency Letter”) from Nasdaq stating that the Company was not in compliance with

Nasdaq Listing Rule 5450(a)(1) because the bid price for the Company’s common stock had closed below $1.00 per share for the previous

34 consecutive business days (the “Minimum Bid Price Requirement”).

In accordance with Nasdaq Listing Rule 5810(c)(3)(A),

the Company has been given 180 calendar days, or until May 5, 2025, to regain compliance with the Minimum Bid Price Requirement.

any time before May 5, 2025, the bid price of the Company’s common stock closes at $1.00 per share or more for a minimum of 10 consecutive

business days, the Staff will provide written confirmation that the Company has achieved compliance.

In the event the Company does not

regain compliance, the Company may be eligible for additional time.

To qualify for the additional compliance period, the Company will

be required to (i) submit, no later than the expiration date, an on-line Transfer Application, (ii) submit a non-refundable $5,000 application

fee, (iii) meet the continued listing requirement for the market value of its publicly held shares and all other continued listing standards

for The Nasdaq Stock Market, with the exception of the bid price requirement, and (iv) will need to provide written notice of its intention

to cure the deficiency during the second compliance period, by effecting a reverse stock split if necessary.

As part of its review process,

the Staff will make a determination of whether they believe the Company will be able to cure this deficiency.

Should the Staff conclude

that the Company will not be able to cure the deficiency, or should the Company determine not to submit a transfer application or make

the required representation, the Staff will provide notice that the Company’s securities will be subject to delisting.

The Nasdaq Price Deficiency Letter has no immediate

impact on the listing of the Company’s common stock, which will continue to be listed and traded on The Nasdaq Global Select Market,

subject to the Company’s compliance with the other continued listing requirements of The Nasdaq Stock Market.

On May 6, 2025, the Company was notified by the

Listing Qualifications Staff (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) that the Staff granted the

Company’s request to transfer the listing of its common stock, par value $0.0005 per share (the “Common Shares”), from

The Nasdaq Global Select Market tier to The Nasdaq Capital Market tier, and that the Staff granted the Company’s request for a second

180-calendar day period, or until November 3, 2025 (the “Second Compliance Period”), to regain compliance with the $1.00 bid

price requirement, as set forth in Nasdaq Listing Rule 5550(a)(2).

To regain compliance with such minimum price requirement, the Company

must evidence a closing bid price of at least $1.00 per share for a minimum of 10 consecutive business days.

The transfer of the listing

of the Common Shares from The Nasdaq Global Select Market to The Nasdaq Capital Market took effect with the open of business on May 8,

The transfer is not expected to impact trading in the Common Shares, which will continue to trade on Nasdaq under the symbol “GURE.”

As previously announced, on November 5, 2024,

the Staff notified the Company that the bid price for the Common Shares had closed below $1.00 per share for 30 consecutive business days

and, as a result, the Company no longer satisfied Nasdaq Listing Rule 5450(a)(1), the minimum bid price requirement applicable to The

Nasdaq Global Select Market issuers.

Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), the Company was afforded an initial 180-calendar day

grace period, through May 5, 2025, to regain compliance with the minimum bid price requirement.

Issuers listed on The Nasdaq Global Select Market

are not eligible for a second 180-day grace period under the Nasdaq Listing Rules.

However, based upon the Company’s compliance

with the various criteria required under Nasdaq Listing Rule 5810(c)(3)(A)(ii) to obtain a second 180-day grace period applicable to issuers

listed on The Nasdaq Capital Market, the Company applied to transfer the listing of its Common Shares to The Nasdaq Capital Market.

noted above, the Staff approved the Company’s transfer application on May 6, 2025.

The Company intends to closely monitor the closing

bid price for its Common Shares and consider all available options to timely remedy the bid price deficiency.

If at any time during the

Second Compliance Period, the closing bid price of the Common Shares is at least $1.00 per share for a minimum of 10 consecutive business

days, the Staff will provide the Company with written confirmation of compliance and the matter will be closed ,

unless the Staff exercises its discretion to extend this ten-day period pursuant to Nasdaq Listing Rule 5810(c)(3)(H) .

The Company can give no assurance that it will

regain or demonstrate compliance during the Second Compliance Period.

If the Company is not able to demonstrate compliance with the minimum

bid price requirement by November 3, 2025, or the Company does not comply with the terms of the extension, the Staff will provide written

notification to the Company that the Common Shares will be delisted.

At that time, the Company may appeal the Staff’s determination

to the Nasdaq Hearings Panel (the “Panel”).

The Company’s appeal request would stay any delisting action by the Staff

at least pending a hearing before the Panel and the expiration of any extension that may be granted by the Panel to the Company following

The Company has provided written notice to Nasdaq

of its intention to cure the deficiency during the Second Compliance Period by effecting a reverse stock split, if necessary.

Our current corporate structure chart is set forth in the following

As a result of our acquisitions of SCHC and SYCI, our historical financial

statements and the information presented below reflects the accounts of SCHC, SYCI, SHSI and DCHC.

The following discussion should be

read in conjunction with our condensed consolidated financial statements and notes thereto appearing elsewhere in this report.

As a result of our acquisitions of SCHC and SYCI,

our historical financial statements and the information presented below reflects the accounts of SCHC, SYCI, SHSI and DCHC.

The following

discussion should be read in conjunction with our condensed consolidated financial statements and notes thereto appearing elsewhere in

RESULTS OF OPERATIONS

The following table presents certain information

derived from the condensed consolidated statements of operations, cash flows and stockholders equity for the three-month and nine-month

periods ended September 30, 2024 and 2023.

Comparison of the Three-Month Period Ended

September 30, 2024 and 2023

derived from the condensed consolidated statements of income, cash flows and stockholders’ equity for the three-month periods ended

March 31, 2025 and 2024.

Comparison of the Three-Month Periods Ended

March 31, 2025 and 2024

Three-Month Period

Ended September 30, 2024

Ended March 31, 2025

Three-Month Period

Ended September 30, 2023

Ended March 31, 2024

Percent Change

Cost of net revenue

$ (1,594,270 )

$ (2,119,845 )

Gross profit (loss)

Sales and marketing expenses

2 unchanged sentences

General and administrative expenses

Income(Loss) from operations

Income(Loss) before taxes

$ (1,389,523 )

Loss from operations

$ (4,610,207 )

$ (5,269,419 )

Other income, net

Other expense

Loss before taxes

$ (4,629,500 )

$ (5,262,192 )

Income tax benefit

Net income(loss)

below shows the changes in net revenue in the respective segment of the Company for the three-month period ended September 30, 2024 as

compared to the same period in 2023:

$ (4,629,500 )

$ (3,992,132 )

Net revenue The table below

shows the changes in net revenue in the respective segment of the Company for the three-month period ended March 31, 2025 compared to

the same period in 2024:

Net Revenue by Segment

2 unchanged sentences

Percent Change

September 30, 2024

September 30, 2023

of Net Revenue

March 31, 2025

March 31, 2024

Chemical Products

Equipment Lease

Bromine and crude salt segments

Three-Month Period Ended

Percentage Change

product sold in tonnes

September 30, 2024

September 30, 2023

Increase (Decrease)

Bromine and crude salt segments product sold in tonnes

March 31, 2025

March 31, 2024

Bromine (excluded volume sold to SYCI)

Bromine segment

For the three-month periods ended September 30, 2024 and 2023, the

net revenue for the bromine segment was $1,571,313 and $4,908,152, respectively.

The decrease of the net revenue of bromine was due to

the 57% decrease in tonnes sold and the 26% decrease in average selling price of bromine in the third quarter of 2024.

selling price of bromine in the third quarter of 2024 was $2,396 compared to the average selling price of bromine in the third quarter

of 2023 of $3,237 (calculated by dividing revenue by tonnes).

For the three-month periods ended March 31, 2025

and 2024, the net revenue for the bromine segment was $1,481,869 and $1,146,197.

This increase was due to the 11% decrease in tonnes sold

and a 45% increase in average selling price.

Crude salt segment

For the three-month periods ended September 30, 2024 and 2023, the

net revenue for the crude salt was $654,039 and $889,556, respectively.

The decrease of net revenue of crude salt was mainly due to the

20% decrease in tonnes sold and the 8% decrease in average selling price of crude salt for the three-month period ended September 30,

For the three-month periods ended March 31, 2025

and 2024, the net revenue for the crude salt was $122,578 and $116,671.

This increase was due to the 16% increase in tonnes sold and a

10% decrease in average selling price.

Chemical products segment

For the three-month periods ended September 30,

For the three-month periods ended March 31, 2025

and 2024, the net revenue for the chemical products segment was $0 due to the closure of our chemical factories since September 1, 2017.

Natural gas segment

For the three-month period ended September 30,

2024 and 2023, the net revenue was $0.

For the three-month period ended September 30,

2024 and 2023, the net revenue for the equipment lease was $17,013 and $67,907.

For the three-month period ended March 31, 2025

and 2024, the net revenue for the natural gas production was $0 and $44,194, respectively.

Cost of Net Revenue

3 unchanged sentences

Three-Month Period Ended

September 30, 2024

September 30, 2023

March 31, 2025

March 31, 2024

Chemical Products

Cost of net revenue reflects mainly

the raw materials consumed, the direct salaries and benefits of staff engaged in the production process, electricity, depreciation and

amortization of manufacturing plant and machinery and other manufacturing costs.

Cost of net revenue reflects mainly the raw materials consumed

and the direct salaries and benefits of staff engaged in the production process, electricity, depreciation and amortization of manufacturing

plant and machinery and other manufacturing costs.

Our cost of net revenue was $1,594,270 for the three-month period ended March

31, 2025, representing a $525,575 (or 25%) decrease compared to the preceding year.

Bromine production capacity and utilization

3 unchanged sentences

Annual Production Capacity (in tonnes)

Three-month period ended September 30, 2023

Three-month period ended September 30, 2024

Variance of the three-month period ended September 30, 2024 and 2023

Three-month period ended March 31, 2024

Three-month period ended March 31, 2025

Variance of the three-month periods ended March 31, 2025 and 2024

(i) Utilization ratio is calculated based on the

annualized actual production volume in tonnes for the periods divided by the annual production capacity in tonnes of all the seven factories

including those that have not commenced operations.

annualized actual production volume in tonnes for the periods divided by the annual production capacity in tonnes.

Bromine segment

For the three-month period ended September 30,

2024, the bromine segment had a net cost of revenue of $3,794,088.

For the three-month period ended September 30,

2023 the cost of net revenue for the bromine segment was $5,995,496.

Cost of net revenue for our bromine segment for

the three-month period ended March 31, 2025 and 2024 was $1,533,128 and $2,072,752.

Crude salt segment

For the three-month period ended September 30,

2024 the cost of net revenue for the crude salt segment was $277,451.

For the three-month period ended September 30,

2023 the cost of net revenue for the crude salt segment was $378,100.

Cost of net revenue for our crude salt segment

for the three-month period ended March 31, 2025 and 2024 was $61,142 and $46,894.

Chemical products segment

Cost of net revenue for our chemical products

segment for the three-month period ended September 30, 2024 and 2023 was $0.

segment for the three-month period ended March 31, 2025 and 2024 was $0.

Natural gas segment

Cost of net revenue for our natural gas segment

for the three-month period ended September 30, 2024 and 2023 was $77 and 306, respectively.

Gross Profit.

Gross loss was $1,829,251

or 82%, of net revenue for three-month period ended September 30, 2024, representing an decrease of $1,320,964, as compared to a gross

profit of $508,287 or 9%, of net revenue for the same period in 2023.

for the three-month period ended March 31, 2025 and 2024 was $0 and $199.

Gross Profit (Loss) Gross profit

was $10,177, or 0.6%, of net revenue for three-month period ended March 31, 2025 compared to loss $812,783, or 62% of net revenue for

three-month period ended March 31, 2024.

Gross Profit (Loss) by Segment

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Three-Month Period Ended

September 30, 2024

September 30, 2023

Profit Margin

Gross Profit(loss) Margin

Gross Profit (loss) Margin

$ (2,222,775 )

$ (1,087,344 )

March 31, 2025

March 31, 2024

Profit (Loss) Margin

Gross Profit Margin

Chemical Products

Equipment Lease

Total Gross Profit (Loss)

$ (1,829,251 )

Bromine segment

For the three-month period ended September 30,

2024, the gross loss for our bromine segment was 141%, compared to 22% in the three-month period ended September 30, 2023.

in gross loss margin was primarily attributable to the lower average selling price of bromine of $2,396 per ton in the three-month period

ended September 30, 2024 compared to $3,237 per ton in the three-month period ended September 30, 2023.

For the three-month period ended September 30,

2023, the gross loss margin for our bromine segment was 22%.

Crude salt segment

For the three-month period ended September 30,

2024, the gross profit margin for our crude salt segment was 58%.

For the three-month period ended September 30, 2023, the gross profit

margin for our crude salt segment was 57%.

For the three-month period ended March 31, 2025,

the gross loss margin for our bromine segment was 3.5%, compared to 81% in the three-month period ended March 31, 2024.

The decrease in

gross loss margin was primarily attributable to the higher average selling price of bromine of $3,684 per ton in the three-month period

ended March 31, 2025 compared to $2,541 per ton in the three-month period ended March 31, 2024.

Bromine tonnes sales also decreased from

451 tonnes for the three month period ended March 31, 2024 to 402 tonnes for the three month period ended March 31, 2025.

Crude salt segmen t

For the three-month period ended March 31, 2025, the gross profit margin

for our crude salt segment was 50%, compared to 60% in the same period in 2024, representing a 10% decrease.

Natural gas segment

For the three-month period ended March 31, 2025,

the gross profit margin for our crude salt segment was 0%, compared to 100% in the same period in 2024.

Direct labor and factory overheads incurred

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As a result, direct labor and factory overhead costs (including depreciation of plant and machinery) in the amount of $3,225,808

and $1,007,689 incurred for the three-month periods ended September 30, 2024 and 2023, respectively, of factories that have not resumed

production were presented as part of the operating expense.

and $3,734,689 incurred for the three-month periods ended March 31, 2025 and 2024, respectively, of factories that have not resumed production

were presented as part of the operating expense.

General and Administrative Expenses

General and administrative expenses were $1,002,529 for the three-month period ended September 30, 2024, representing an increase of $239,645

General and administrative expenses were $1,389,523 for the three-month period ended March 31, 2025, an increase of $672,067 (or 94%)

as compared to $717,456 for the same period in 2024.

Income (loss) from Operations loss

from operations was $4,581,609 for the three-month period ended September 30, 2024, compared to income of $2,293,288 in the same period

Loss from Operations Loss from operations

was $4,610,207 the three-month period ended March 31, 2025, compared to loss from operation of $5,269,419 in the same period in 2024.

Loss from Operations by Segment

Three-Month Period Ended

September 30, 2024

March 31, 2025

Three-Month Period Ended

September 30, 2023

March 31, 2024

$ (3,370,836 )

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Chemical Products

Income(loss) from operations before corporate costs

Corporate costs

Loss from operations before corporate costs

Corporate cost

Unrealized gain (loss) on translation of intercompany balance

Income (loss) from operations

Loss from operations

$ (4,610,207 )

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Loss from operations from our bromine segment was $3,370,836 for the

three-month period ended September 30, 2024, compared to loss from operations of $2,143,203 in the same period in 2023.

The decrease of

the net revenue of bromine was due to the 57% decrease in tonnes sold and the 26% decrease in average selling price of bromine in the

third quarter of 2024.

Crude salt segment

Loss from operations from our crude salt segment

was $102,657 for the three-month period ended September 30, 2024, compared to income from operations of $500,469 in the same period in

The decrease of net revenue of crude salt was mainly due to the 20% decrease in tonnes sold and the 8% decrease in average selling

price of crude salt for the three-month period ended September 30, 2024.

Chemical products segment

Loss from operations from our chemical products

segment was $339,038 for the three-month period ended September 30, 2024, compared to loss from operations of $397,410 in the same period

Natural gas segment

Loss from operations from our natural gas segment

was $39,072 for the three -month period ended September 30, 2024, compared to an income of $4,156 in the same period in 2023.

Other Income(loss), Net Other loss,

net of $14,971 represented bank interest income, net of capital lease interest expense for the three -month period ended September 30,

2024, a decrease of $48,938 as compared to the same period in 2023.

Net Income (loss) Net loss was $3,492,883

for the three-month period ended September 30, 2024, compared to a net loss of $1,775,797 in the same period in 2023.

Comparison of the Nine-Month Period Ended

September 30, 2024 and 2023

Nine-Month Period

Ended September 30, 2024

Nine-Month Period

Ended September 30, 2023

Percent Change

Cost of net revenue

(11,303,519 )

(20,464,418 )

Sales, marketing and other operating expenses

Direct labor and factory overheads incurred during plant shutdown

Other operating loss

General and administrative expenses

Income(Loss) from operations

(14,998,025 )

Other Expenses

(29,173,011 )

Income(Loss) before taxes

(44,164,800 )

Income tax benefit (expense)

Net income(loss)

$ (40,582,933 )

$ (3,015,360 )

below shows the changes in net revenue in the respective segment of the Company for the nine-month period ended September 30, 2024 as

compared to the same period in 2023:

Net Revenue by Segment

Nine-Month Period Ended

Percent Increase

September 30, 2024

September 30, 2023

of Net Revenue

Chemical Products

Equipment Lease

Bromine and crude salt segments

Nine-Month Period Ended

Percentage Change

product sold in tonnes

September 30, 2024

September 30, 2023

Bromine (excluding volume sold to SYCI)

Bromine segment

Net revenue from our bromine segment decreased

to $4,576,744 for the nine-month period ended September 30, 2024 compared to $20,734,871 for the same period in 2023 respectively, due

to the lower selling price and selling quantity.

Crude salt segment

Net revenue from our crude salt segment decreased

to $1,294,645 for the nine-month period ended September 30, 2024 compared $2,287,672 for the same period in 2023, respectively, due to

the lower selling price and selling quantity.

Chemical products segment

For the nine-month period ended September 30,

2024 and 2023, the net revenue for the chemical products segment was $0 due to the closure of our chemical factories since September 1,

Natural gas segment

For the nine-month period ended September 30,

2024 and 2023, the net revenue for the natural gas was $0.

Equipment Lease

For the nine-month period ended September 30,

2024 and 2023, the net revenue for the equipment lease was $61,207 and $150,861.

Cost of Net Revenue

Cost of Net Revenue by Segment

Nine-Month Period Ended

September 30, 2024

September 30, 2023

Chemical Products

Cost of net revenue reflects mainly

the raw materials consumed-direct salaries and benefits of staff engaged in the production process, electricity, depreciation and amortization

of manufacturing plant and machinery and other manufacturing costs.

Bromine production capacity and utilization

of our factories

The table below represents the annual capacity

and utilization ratios for all of our bromine producing properties:

Annual Production Capacity (in tonnes)

Nine-month period ended September 30, 2023

Nine-month period ended September 30, 2024

Variance of the nine-month period ended September 30, 2024 and 2023

Utilization ratio is calculated based on the annualized actual production volume in tonnes for the periods divided by the annual production capacity in tonnes.

Bromine segment

For the nine-month period ended September 30,

2024 the cost of net revenue for the bromine segment was $10,595,899.

For the nine-month period ended September 30,

2023 the cost of net revenue for the bromine segment was $19,187,620.

Crude salt segment

For the nine-month period ended September 30,

2024 the cost of net revenue for the crude salt segment was $707,344.

The cost of net revenue for our crude salt segment for the nine-month

period ended September 30, 2023 was $1,276,119.

The reason for the decrease is that there is that

with the creation of SHSI, some costs formerly allocated to crude sale were allocated to bromine.

Natural gas segment

Cost of net revenue for our natural gas segment

for the nine-month period ended September 30, 2024 and 2023 was $276 and $679.

Gross Profit.

Loss profit was $5,370,923,

or 91%, of net revenue for nine-month period ended September 30, 2024 compared to $2,708,986, or 12%, of net revenue for the same period

Gross Profit (Loss) by Segment

% Point Change

Nine-Month Period Ended

September 30, 2024

September 30, 2023

Profit Margin

Gross Profit (loss) Margin

Gross Profit Margin

$ (6,019,155 )

Chemical Products

Equipment Lease

Total Gross Profit(Loss)

$ (5,370,923 )

Bromine segment

For the nine-month period ended September 30,

2024, the gross loss margin for our bromine segment was 132%, compared to 7% in the nine-month period ended September 30, 2023.

in gross loss margin was primarily attributable to the lower average selling price of bromine of $2,423 per ton in the nine-month period

ended September 30, 2024 compared to $3,493 per ton in the nine-month period ended September 30, 2023.

For the nine-month period ended September 30,

2023, the gross profit margin for our bromine segment was 7%.

Crude salt segment

For the nine-month period ended September 30,

2024, the gross profit margin for our crude salt segment was 45%.

For the nine-month period ended September 30,

2023 the gross profit margin for our crude salt segment was 44%.

Chemical products segment

For the nine-month period ended September 30,

2024, the gross profit margin for our chemical segment was 0% due to the closure of our chemical products plant.

As a result of the closure,

there were no chemical products for sale for the nine-month period ended September 30, 2024.

Direct labor and factory overheads incurred

during plant shutdown On September 1, 2017, the Company received notification from the government of Yangkou County, Shouguang

City of PRC that stated that production at all its bromine and crude salt and chemical factories should be halted with immediate effect

in order for the Company to perform rectification and improvement in accordance with the county’s new safety and environmental protection

requirements.

On November 24, 2017, the Company received a letter from the Government of Yangkou County, Shouguang City notifying the

Company to relocate its two chemical production plants located in the second living area of the Qinghe Oil Extraction Plant to Bohai

As a result, direct labor and factory overhead costs (including depreciation of plant and machinery) in the amount of $ 7,185,537

and $4,471,954 incurred for the nine-month periods ended September 30, 2024 and 2023, respectively, for the factories that have not resumed

production were presented as part of the operating expense.

General and Administrative Expenses.

General and administrative expenses were $ 2,409,957 for the nine-month period ended September 30,

2024, a increase of $143,697 (or 6%) as compared to $ 2,266,260 for the same period in 2023.

was mainly due to the unrealized foreign currency transaction loss on intercompany balance recorded in nine-month period ended September

30, 2024 compared to an unrealized foreign currency transaction gain on intercompany balance recorded in the same period in the previous

Income (Loss) from Operations.

from operations was $14,998,025 for the nine-month period ended September 30, 2024, compared to an income of $4,011,944 in the same period

Income(Loss) from Operations by Segment

Nine-Month Period Ended

September 30, 2024

Nine-Month Period Ended

September 30, 2023

$ (13,475,400 )

$ (3,340,404 )

Chemical Products

Income (Loss) from operations before corporate costs

(14,656,795 )

Corporate costs

Unrealized gain on translation of intercompany balance

Income (Loss) from operations before taxes

$ (14,998,025 )

$ (4,011,944 )

Bromine segment

Loss from operations from our bromine segment

was $13,475,400 for the nine-month period ended September 30, 2024, compared to a loss of $3,340,404 in the same period in 2023.

in gross loss margin was primarily attributable to the lower average selling price of bromine of $2,423 per ton in the nine-month period

ended September 30, 2024 compared to $3,493 per ton in the nine-month period ended September 30, 2023.

three-month period ended March 31, 2025, compared to loss from operations of $4,782,815 in the same period in 2024.

This decrease

was due to the a 45% increase in average selling price partially offset by a decrease of 11% in tonnes sold.

Crude salt segment

Loss from operations from our crude salt segment

was $47,725 for the nine-month period ended September 30, 2024, compared to an income of $904,482 in the same period in 2023.

Loss from operations from our crude salt segment was $554,062 for the

three-month period ended March 31, 2025, compared to loss from operations of $75,092 in the same period in 2024.

The main reason for the

increase in raw salt in 2024 compared to 2023 is that sales also rose by 16%.

Chemical products segment

Loss from operations from our chemical products

segment was $993,116 for the nine-month period ended September 30, 2024, compared to a loss of $1,231,302 in the same period in 2023.

segment was $358,629 for the three-month period ended March 31, 2025, compared to loss from operations of $314,824 in the same period

Natural gas segment

Loss from operations from our natural gas segment

was $140,554 for the nine-month period ended September 30, 2024, compared to an income of $14,011 in the same period in 2023.

Other Income, Net.

Other income,

net of $6,236 represented bank interest income, net of capital lease interest expense for the nine -month period ended September 30, 2024,

a decrease of $113,569, (or approximately 95%) as compared to the same period in 2023.

Net Income (Loss).

$ 40,582,933 for the nine-month period ended September 30, 2024, compared to a net loss of $3,015,360

in the same period in 2023.

Net Income Per Share

For the nine months ended September 30, 2024,

net loss per share was $ 3.78 compared to a loss of $0.29 in the period ending September 30, 2023.

There were 10,726,924 shares outstanding compared to 10,431,924 shares.

Foreign Currency Translation Adjustment

For the nine months ending September 30, 2024,

the Company had a positive foreign currency translation adjustment of $1,859,755 versus a positive adjustment of $7,879,513 in the previous

This adjustment impacts all balance sheet translations into U.S.

was $44,844 for the three -month period ended March 31, 2025, compared to loss from operations of $27,709 in the same period in 2024.

Other Income(Expense) Net Other

expense, net of $19,293 represented bank interest income, net of finance lease interest expense for the three -month period ended March

31, 2025, an increase of $26,520 (or approximately 367%) as compared to the same period in 2024.

Net Loss Net loss was $4,629,500

for the three-month period ended March 31, 2025, compared to a net loss of $3,992,132 in the same period in 2024.

LIQUIDITY AND CAPITAL RESOURCES

As of September 30, 2024, cash and cash equivalents

As of March 31, 2025, cash and cash equivalents

were $8,523,045 as compared to $10,075,162 as of December 31, 2024.

1 unchanged sentence

Statement of Cash Flows

Nine-Month Period Ended September 30,

Net cash (used in) provided by operating activities

Net cash used in investing activities

Three-Month Period Ended March 31,

Net cash used in operating activities

$ (1,580,128 )

$ (1,330,476 )

Net cash used in financing activities

Net cash used in investing activities

Effects of exchange rate changes on cash and cash equivalents

2 unchanged sentences

$ (1,462,098 )

For the nine-month period ended September 30,

2024, we met our working capital and capital investment requirements by using cash on hand.

Net Cash (used in) Provided by Operating Activities

During the six-month period ended September 30, 2024, cash flow used

in by operating activities of approximately $0.29 million was mainly due to a net loss of $40.58 million, a decrease in deferred taxes

of $3.62 million and offset by depreciation and amortization expense of $14.04 million and loss on disposal of equipment of $29.17 million.

During the nine-month period ended September 30, 2023, cash flow provided

by operating activities of approximately $9.9 million was mainly due to a non-cash adjustment for depreciation and amortization expense

of $15.4 million and offset by a net loss of $3.02 million and an increase in prepayments and deposits of $3.95 million.

For the three-month period ended March 31, 2025,

we met our working capital and capital investment requirements mainly by using cash on hand.

Net Cash Provided by (Used in) Operating Activities

During the three -month period ended March 31, 2025, cash flow used

in operating activities of approximately $1.58 million was mainly due to a net loss of $4.62 million, an increase in accounts receivable

of $1.5 million, offset by a non-cash adjustment related to depreciation and amortization of property, plant and equipment of $4 million.

During the three-month period ended March 31, 2024, cash flow used

in operating activities of approximately $1.33 million was mainly due to a net loss of $3.99 million, an increase in accounts receivable

of $0.4 million, a non-cash adjustment related to deferred taxes of $1.27 million, offset by depreciation and amortization expenses of

$4.73 million.

Accounts receivable

1 unchanged sentence

a major impact on our overall liquidity.

The following table presents the aging analysis of our accounts receivable as of September 30,

The following table presents the aging analysis of our accounts receivable as of March 31, 2025

and December 31, 2024.

September 30, 2024

March 31, 2025

December 31, 2024

7 unchanged sentences

Aged 211-240 days

The overall accounts receivable balance as of

September 30, 2024 decreased by $3,678,816, as compared to those of December 31, 2023.

We have policies in place to ensure that sales

are made to customers with an appropriate credit history.

The overall accounts receivable balance as of March 31, 2025 increased

by $1,549,699, as compared to those of December 31, 2024.

We have policies in place to ensure that sales are made to customers with an

appropriate credit history.

We perform ongoing credit evaluation on the financial condition of our customers.

No allowance for doubtful accounts for the three-month and nine-month periods ended September 30, 2024 is required.

Our inventory consists of the following:

September 30, 2024

March 31, 2025

December 31, 2024

1 unchanged sentence

Finished goods

The net inventory level as of September 30, 2024

decreased by $149,390, as compared to the net inventory level as of December 31, 2023.

Raw materials decreased by $3,007 as of September

The net inventory level as of March 31, 2025 increased

by $139,688(or 44%), as compared to the net inventory level as of December 31, 2024.

The increase in inventory goods is an estimate that

market demand may rise .

Raw materials increased by $31,255 as of March

31, 2025 as compared to December 31, 2024.

Our finished goods decreased by $146,383 as of

September 30, 2024 as compared to December 31, 2023.

Net Cash Used in Investing Activities

During the six months ended September 30, 2024,

we used approximately $60.5 million to acquire property, plant and equipment, which primarily included the cost of bromine wells and the

installation of high and low voltage lines for these bromine wells, as well as the purchase of salt plants.

For the nine-month period ended September 30,

2023, we used approximately $15.2 million to the flood prevention project aiming to prevent flooding that could harm the wells, aqueducts

and crude salt pans at our plant.

Net Cash Used in Financing Activities

For the nine-month period ended September 30,

2024 and 2023, we used $0.3 million to repay finance lease obligations.

Our finished goods increased by $108,433 as of

March 31, 2025 as compared to December 31, 2024.

Net Cash Provided by (Used in) Investing

We have no investing activities for the three-month

periods ended March 31, 2025 and 2024.

Net Cash Provided by (Used in)

Financing Activities

We have no financing activities for the three-month

periods ended March 31, 2025 and 2024.

We believe that our available funds and cash flows

1 unchanged sentence

next twelve (12) months.

We had available cash of approximately $11.24

million at September 30, 2024, all of which is in highly liquid current deposits earning no or little interest.

We do not anticipate paying

cash dividends in the foreseeable future.

We intend to continue to focus our efforts on the activities of SCHC,

SYCI, SHSI and DCHC as these segments continue to expand within the Chinese market.

We had available cash of approximately $8.52 million

at March 31, 2025, most of which is in highly liquid current deposits which earn no or little interest.

We do not anticipate paying cash

dividends in the foreseeable future.

We intend to continue to focus our efforts on

the activities of SCHC, SYCI, SHSI and DCHC as these segments continue to expand within the Chinese market.

We may not be able to identify, successfully integrate

2 unchanged sentences

of risks, including possible adverse effects on our operating results, diversion of management’s attention, inability to retain

key personnel, risks associated with unanticipated events, risks associated with the COVID-19 pandemic and the financial statement effect

of potential impairment of acquired intangible assets, any of which could have a materially adverse effect on our condition and results of

In addition, if competition for acquisition candidates or operations were to increase, the cost of acquiring businesses could

increase materially.

We may effect an acquisition with a target business which may be financially unstable, under-managed, or in its early

stages of development or growth.

Our inability to implement and manage our expansion strategy successfully may have a material adverse

effect on our business and future prospects.

key personnel, risks associated with unanticipated events and the financial statement effect of potential impairment of acquired intangible

assets, any of which could have a materially adverse effect on our condition and results of operations.

In addition, if competition

for acquisition candidates or operations were to increase, the cost of acquiring businesses could increase materially.

We may effect an

acquisition with a target business which may be financially unstable, under-managed, or in its early stages of development or growth.

Our inability to implement and manage our expansion strategy successfully may have a material adverse effect on our business and future

Contractual Obligations and Commitments

We have no significant contractual obligations

not fully recorded on our consolidated balance sheets or fully disclosed in the notes to our consolidated financial statements.

information regarding our contractual obligations and commitments at September 30, 2023 is provided in the notes to our consolidated financial

See “Notes to Condensed Consolidated Financial Statements, Note 17 – Capital Commitment and Operating Lease Commitments”.

not fully recorded on our condensed consolidated balance sheets or fully disclosed in the notes to our condensed consolidated financial

Additional information regarding our contractual obligations and commitments at March 31, 2025 is provided in the notes to

our condensed consolidated financial statements.

Material Off-Balance Sheet Arrangements

12 unchanged sentences

used by us in the preparation of our financial statements:

accounts receivable and allowance for doubtful accounts, leases, property,

plant and equipment, recoverability of long lived assets, revenue recognition, income taxes, loss contingencies, and stock-based compensation.

These policies and estimates are described in the Company’s 2023 Form 10-K.

accounts receivable and allowance for doubtful accounts, inventories and allowance

for obsolescence, assets retirement obligation, property, plant and equipment, recoverability of long-lived assets, mineral rights, leases,

revenue recognition, income taxes, and loss contingencies.

These policies and estimates are described in the Company’s Form 10-Q

for the three months ended March 31, 2025.

Quantitative and Qualitative Disclosures About Market Risk

Pursuant to Item 305(e) of Regulation S-K (§ 229.305(e)), the

Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined

by Rule 229.10(f)(1).

Pursuant to Item 305(e) of Regulation S-K (§

229.305(e)), the Company is not required to provide the information required by this Item as it is a “smaller reporting company,”

as defined by Rule 229.10(f)(1).

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 2. Management’s Discussion and Analysis