Triller Group Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS TRILLER GROUP INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (U.S. Dollars in thousands (“US$’000”), except for share and per share amounts) As of March 31, 2026 December 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 2,193 $ 2,294 Restricted cash 9,921 10,316 Accounts receivable, net 887 919 Deposit, prepayments, and other receivables, net 1,316 1,416 Assets held for sale — 283 Total current assets 14,317 15,228 Non-current assets: Property and equipment, net — — Long-term investments, net 19,444 19,753 Long-term investments, net, related party 520 524 Right-of-use assets, net — — Total non-current assets 19,964 20,277 TOTAL ASSETS $ 34,281 $ 35,505 LIABILITIES AND STOCKHOLDERS’ DEFICIT Current liabilities: Accounts payable and other current liabilities $ 203,763 $ 187,599 Other current liabilities, related parties 7,070 5,778 Escrow liabilities 9,921 10,316 Borrowings 11,288 11,484 Borrowings, related party 51,265 48,959 Convertible debts 36,682 36,268 Convertible debts, related party 59,722 59,722 Warrant liabilities — — Income tax payable 49 109 Operating lease liabilities, current 907 960 Total current liabilities 380,667 361,195 Non-current liabilities: Operating lease liabilities, non-current 2,165 2,426 Total non-current liabilities 2,165 2,426 TOTAL LIABILITIES 382,832 363,621 Commitments and contingencies Stockholders’ deficit: Preferred stock, $ 0.001 par value, 100,000,000 shares authorized Series A-1 preferred stock, $ 0.001 par value, 50,000,000 shares authorized; 11,801,804 shares issued and outstanding as of March 31, 2026 and December 31, 2025 12 12 Series B preferred stock, $ 0.001 par value, 50,000,000 shares authorized; Nil and 30,851 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively — — * Common stock, $ 0.001 par value; 150,000,000,000 shares authorized, 175,488,522 and 175,288,522 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively 175 175 Common stock to be issued 12 12 Common stock held in escrow 22 22 Additional paid-in capital 1,061,450 1,050,342 Accumulated other comprehensive income (loss) 169 ( 500 ) Accumulated deficit ( 1,410,391 ) ( 1,378,179 ) Total stockholders’ deficit ( 348,551 ) ( 328,116 ) TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT $ 34,281 $ 35,505 * Less than $1,000 See accompanying notes to the unaudited condensed consolidated financial statements. 1 TRILLER GROUP INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (U.S. Dollars in thousands, except for the share and per share amounts) For the three months ended March 31, 2026 2025 Revenues, net Loan interest income $ — $ 18 Commission 4,756 4,416 Recurring asset management service fees 274 347 5,030 4,781 Operating expenses: Commission expense ( 3,470 ) ( 2,521 ) Sales and marketing expense ( 234 ) — Research and development expense ( 535 ) ( 1,702 ) Personnel and benefit expense ( 16,448 ) ( 34,964 ) Legal and professional fee ( 7,786 ) ( 5,838 ) Office and operating fee, related party ( 663 ) ( 1,178 ) Provision for allowance for expected credit losses ( 2 ) ( 47 ) Other general and administrative expenses ( 3,612 ) ( 2,733 ) Total operating expenses ( 32,750 ) ( 48,983 ) Loss from operations ( 27,720 ) ( 44,202 ) Other income (expense): Interest income 2 167 Interest expense ( 4,500 ) ( 4,803 ) Foreign exchange (loss) gain, net ( 212 ) 1,145 Bad debts recovered (written off) 256 ( 5,441 ) Sundry income 14 106 Total other expenses, net ( 4,440 ) ( 8,826 ) Loss before income taxes ( 32,160 ) ( 53,028 ) Income tax expense ( 52 ) ( 24 ) Net loss $ ( 32,212 ) $ ( 53,052 ) Comprehensive loss: Net loss $ ( 32,212 ) $ ( 53,052 ) Other comprehensive loss Foreign currency translation adjustment 669 61 Comprehensive loss $ ( 31,543 ) $ ( 52,991 ) Weighted average number of common stock outstanding - Basic and diluted 197,443,436 165,497,103 Net loss per share - Basic and diluted $ ( 0.16 ) $ ( 0.32 ) See accompanying notes to the unaudited condensed consolidated financial statements. 2 TRILLER GROUP INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT (U.S. Dollars in thousands, except for share and per share amounts) For the three months ended March 31, 2026 Series A-1 preferred stock Series B preferred stock Common stock Series A-1 preferred stock to be issued Common stock to be issued Common stock held under escrow Additional Accumulated other comprehensive Total stockholders’ Note No. of share Amount No. of share Amount No. of share # Amount No. of share Amount No. of share Amount No. of share Amount paid-in capital income (loss) Accumulated deficit (deficit) equity Balance as of December 31, 2025 11,801,804 $ 12 30,851 $ — * 175,288,522 $ 175 — $ — 11,795,211 $ 12 21,978,469 $ 22 $ 1,050,342 $ ( 500 ) $ ( 1,378,179 ) $ ( 328,116 ) Stock-based compensation to directors, officers, and employees 12(a) — — — — 200,000 — * — — — — — — 11,108 — — 11,108 Redemption of Series B shares 12(b) — — ( 30,851 ) — * — — — — — — — — — — — — Foreign currency translation adjustment — — — — — — — — — — — — — 669 — 669 Net loss for the period — — — — — — — — — — — — — — ( 32,212 ) ( 32,212 ) Balance as of March 31, 2026 11,801,804 $ 12 — $ — 175,488,522 $ 175 — $ — 11,795,211 $ 12 21,978,469 $ 22 $ 1,061,450 $ 169 $ ( 1,410,391 ) $ ( 348,551 ) For the three months ended March 31, 2025 Series A-1 preferred stock Series B preferred stock Common stock Series A-1 preferred stock to be issued Common stock to be issued Common stock held in escrow Additional Accumulated other Total Note No. of share Amount No. of share Amount No. of share # Amount No. of share Amount No. of share # Amount No. of share Amount paid-in capital comprehensive loss Accumulated deficit stockholders’ deficit Balance as of January 1, 2025 11,801,804 $ 12 30,851 $ — * 138,143,817 $ 138 11,801,804 $ 12 15,022,711 $ 15 24,022,431 $ 24 $ 958,017 $ ( 548 ) $ ( 1,203,637 ) $ ( 245,967 ) Settlement of payables with common stock held in escrow — — — — 2,043,962 2 — — — — ( 2,043,962 ) ( 2 ) — — — — Issuance of common stock for repayment of borrowings, related party — — — — 155,000 — — — — — — — 554 — — 554 Stock-based compensation to consultants — — — — 348,745 — — — — — — — 2,087 — — 2,087 Stock-based compensation to directors, officers, and employees — — — — 766,487 1 — — — — — — 28,875 — — 28,876 Settlement of Series A-1 preferred stock to be issued in related to merger transaction — — — — 11,807,332 12 ( 11,801,804 ) ( 12 ) — — — — — — — — Foreign currency translation adjustment — — — — — — — — — — — — — 61 — 61 Net loss for the period — — — — — — — — — — — — — — ( 53,052 ) ( 53,052 ) Balance as March 31, 2025 11,801,804 $ 12 30,851 $ — * 153,265,343 $ 153 — $ — 15,022,711 $ 15 21,978,469 $ 22 $ 989,533 $ ( 487 ) $ ( 1,256,689 ) $ ( 267,441 ) * Less than $1,000 See accompanying notes to the unaudited condensed consolidated financial statements. 3 TRILLER GROUP INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Currency expressed in United States Dollars in thousand (“US$’000”)) For the three months ended March 31, 2026 2025 Cash flows from operating activities: Net loss $ ( 32,212 ) $ ( 53,052 ) Adjustments to reconcile net loss to net cash used in operating activities Stock-based compensation 11,108 28,750 Marketing expense — 513 Interest income ( 2 ) ( 167 ) Interest expense on borrowings 4,500 4,803 Foreign exchange loss (gain), net 212 ( 1,145 ) Bad debts (recovered) written off ( 256 ) 5,441 Provision for allowance for expected credit losses 2 47 Gain on disposal of asset held for sale — ( 68 ) Change in operating assets and liabilities: Accounts receivable 288 ( 1,520 ) Loans receivable — ( 1,330 ) Deposits, prepayments, and other receivables 98 ( 183 ) Accounts payable and other current liabilities 12,931 3,003 Accounts payable and other current liabilities, related parties 1,293 570 Escrow liabilities ( 395 ) ( 1,404 ) Operating lease liabilities ( 314 ) ( 462 ) Income tax payable ( 60 ) 26 Net cash used in operating activities ( 2,807 ) ( 16,178 ) Cash flows from investing activities: Proceeds from disposal of assets held for sale 283 1,527 Net cash provided by investing activities 283 1,527 Cash flows from financing activities: Proceeds from borrowings, related parties 2,249 11,728 Repayments of borrowings ( 85 ) — Repayments of borrowings, related parties ( 55 ) — Net cash provided by financing activities 2,109 11,728 Effect on exchange rate change on cash, cash equivalents and restricted cash ( 81 ) 585 Net change in cash, cash equivalent and restricted cash ( 496 ) ( 2,338 ) Beginning of period 12,610 17,261 End of period $ 12,114 $ 14,923 Supplemental cash flow information: Cash paid for income taxes $ 112 $ — As of March 31, 2026 December 31, 2025 Reconciliation to amounts on unaudited condensed consolidated balance sheets: Cash and cash equivalents $ 2,193 $ 2,294 Restricted cash 9,921 10,316 Total cash, cash equivalents and restricted cash $ 12,114 $ 12,610 See accompanying notes to the unaudited condensed consolidated financial statements. 4 TRILLER GROUP INC. AND SUBSIDIARIES NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025 (Currency expressed in United States Dollars in thousand (“US$’000”), except for number of shares) NOTE 1 — DESCRIPTION OF BUSINESS Organization Triller Group Inc. (“ILLR”, “Triller”, or the “Company”) was formed in the State of Delaware on October 15, 2024, to domicile the Company’s legal jurisdiction from British Virgin Islands to the State of Delaware. ILLR and its subsidiaries are hereinafter referred to as the “Company”. The Company currently operates a global, artificial intelligence (“AI”) powered technology platform (“Technology Platform”) that serves a broad constituency of creators and brands around the world. “Creators” include influencers, artists, athletes and public figures that utilize Triller’s Technology Platform to create and publish content. “Brands” are companies, products or product lines which are active on Triller’s Technology Platform and utilize or have utilized one or more of Triller’s products or services offered through Triller’s Technology Platform, or companies, products or product lines whose associated data Triller tracks, report on and make available to Triller’s clients as part of one or more of Triller’s product offerings. Also, the Company remains the operation of a wealth and health platform which offers a wide range of financial service and products, covering life insurance, pensions, property-casualty insurance, stock brokerage, mutual funds and lending businesses in Hong Kong. NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES These accompanying unaudited condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying unaudited condensed consolidated financial statements and notes. ● Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company are presented in United State dollars (“US$” or “$”) and have been prepared in accordance with accounting principles generally accepted in the United States of America(“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X of the Securities Exchange Commission. Certain information and footnote disclosures normally included in unaudited condensed consolidated financial statements have been omitted pursuant to such rules and regulations. The consolidated balance sheet as of December 31, 2025 derived from the unaudited condensed consolidated financial statements at that date, but does not include all the information and footnotes required by U.S. GAAP. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed on April 14, 2026. The unaudited condensed consolidated financial statements as of March 31, 2026 and for the three months ended March 31, 2026, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial condition, results of operations and cash flows. The results of operations for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for any other interim period or for the entire year. ● Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the financial statements of ILLR and its subsidiaries. A subsidiary is an entity (including a structured entity), directly or indirectly, controlled by the Company. The unaudited condensed consolidated financial statements of the subsidiaries are prepared for the same reporting period as the Company, using consistent accounting policies. All intercompany transactions and balances between ILLR and its subsidiaries are eliminated upon consolidation. 5 ● Use of Estimates and Assumptions The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s unaudited condensed consolidated financial statements include the useful lives of property and equipment, impairment of long-lived assets and right-of-use assets, allowance for expected credit losses, stock-based compensation, fair valuation for long-term investments, fair value measurement of convertible promissory notes payable, and warrant liabilities, provision for contingent liabilities, revenue recognition, income tax provision, deferred taxes and uncertain tax position. The inputs into the management’s judgments and estimates consider the geopolitical tension, inflationary and high interest rate environment and other macroeconomic factors on the Company’s critical and significant accounting estimates. Actual results could differ from these estimates. ● Foreign Currency Translation and Transaction Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the unaudited condensed consolidated statements of operations and comprehensive loss. The reporting currency of the Company is US$ and the accompanying unaudited condensed consolidated financial statements have been expressed in US$. In addition, some of the Company’s subsidiaries are operating in Hong Kong, which maintain their books and record in their local currency, Hong Kong dollars (“HK$”), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with Accounting Standards Codification (“ASC”) Topic 830-30, Translation of Financial Statement , using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive loss within the unaudited condensed consolidated statements of changes in stockholders’ deficit. Translation of amounts from HK$ into US$ has been made at the following exchange rates for the period ended March 31, 2026 and 2025: March 31, 2026 March 31, 2025 Period-end HK$:US$ exchange rate 0.1276 0.1285 Period average HK$:US$ exchange rate 0.1280 0.1285 ● Segment Reporting ASC Topic 280, Segment Reporting , establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company’s business segments. The Company uses the management approach to determine reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker (“CODM”) for making decisions, allocating resources and assessing performance. The Company’s CODM has been identified as the Chief Executive Officer (“CEO”), who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company. Based on management’s assessment, the Company determined that it has three reportable segments, which are Social Media, Sports Streaming, and Financial Services. 6 ● Cash and Cash Equivalents Cash and cash equivalents consist primarily of cash in readily available checking and saving accounts. They consist of highly liquid investments that are readily convertible to cash and that mature within three months or less from the date of purchase. The carrying amounts approximate fair value due to the short maturities of these instruments. The Company maintains most of its bank accounts in the United States of America and Hong Kong. Hong Kong is not protected by Federal Deposit Insurance Corporation (“FDIC”) insurance. However, management does not believe there is a significant risk of loss. ● Restricted Cash Restricted cash consists of funds held in escrow accounts reflecting the restricted cash and cash equivalents maintained in certain bank accounts that are held for the exclusive interest of the Company’s customers. The Company currently acts as a custodian to manage the assets and investment portfolio on behalf of its customers under the terms of certain contractual agreements, which the Company does not have the right to use for any purposes, other than managing the portfolio. The Company restricts the use of the assets underlying the funds held in escrow to meet with regulatory or contractual requirements and classifies the assets as current based on their purpose and availability to fulfill its direct obligation under current liabilities. ● Accounts Receivable, net Accounts receivable, net are recorded at the invoiced amount less any allowance for expected credit losses to reserve for potentially uncollectible receivables. Accounts receivable, net are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms. The Company’s payment terms of accounts receivable vary by the types of services offered. The normal settlement terms of accounts receivable from insurance companies in the provision of brokerage agency services are within 30 days upon the execution of the insurance policies. Credit terms with the products providers of investment, unit and mutual funds and asset portfolio are mainly 90 days or a credit period mutually agreed between the contracting parties. For certain services and customers, the Company requires payment before services are delivered to the customers. Changes in the allowance for expected credit losses are recorded in general and administrative expense in the unaudited condensed consolidated statement of operations and comprehensive loss. To determine the amount of allowance, the Company estimates all expected credits losses based on historical experience, current conditions and reasonable and supportable forecasts. The Company seeks to maintain strict control over its outstanding receivables to minimize credit risk. Overdue balances are reviewed regularly by senior management. Management reviews its receivables on a regular basis to determine if the allowance for expected credit losses is adequate and provides allowance when necessary. The Company does not hold any collateral or other credit enhancements over its accounts receivable balances. 7 ● Allowance for Expected Credit Losses In accordance with ASC Topic 326, “Credit Losses – Measurement of Credit Losses on Financial Instruments” (“ASC Topic 326”), the Company utilizes the current expected credit losses (“CECL”) model to determine an allowance that reflects its best estimate of the lifetime expected credit losses on accounts receivable, loans receivable, notes receivable, and deposits, prepayments and others receivable which is recorded as a liability to offset the receivables. The CECL model is prepared after considering historical experience, current conditions, and reasonable and supportable economic forecasts to estimate lifetime expected credit losses. Accounts receivable, and deposits, prepayments, and others receivable are written off when deemed uncollectible. Recoveries of receivables previously written off are recorded as a reduction of bad debt expense. For the three months ended March 31, 2026 and 2025, the aggregated provision for allowance for expected credit losses on accounts receivable, loans receivable, notes receivable, and other receivables was $ 0.002 million and $ 0.05 million, respectively. ● Rental Deposit Rental deposit represents the deposit paid for the office leases under the long-term lease, less the allowance for expected credit losses, which is presented under the non-current assets of the unaudited condensed consolidated balance sheet based on the expected collection date. The rental deposits is classified to current assets when the lease contract is expected to be expired less than a year. ● Asset Held For Sale The Company classifies long-lived assets as held for sale in the period in which the criteria are met, in accordance with ASC 360, “Property and Equipment” . The Company ceases depreciation on long-lived assets (or disposal groups) classified as held for sale and measures them at the lower of carrying value or estimated fair value less cost to sell. As of March 31, 2026 and December 31, 2025, the carrying value of the premises was approximately $0.0 and $ 0.3 million, respectively and recorded as assets held for sale in the unaudited condensed consolidated balance sheets. This asset was sold in January 2026. ● Long-Term Investments, net The Company invests in equity securities with readily determinable fair values and equity securities that do not have readily determinable fair values. 8 Equity securities with readily determinable fair values are carried at fair value with any unrealized gains or losses reported in earnings. Equity securities that do not have readily determinable fair values mainly consist of investments in privately-held companies. They are stated at cost less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. At each reporting period, the Company makes a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired. ● Property and Equipment, net Property and equipment, net are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values, if any: Expected useful life Building Shorter of 50 years or lease term Furniture, fixtures and equipment 3 to 5 years Computer equipment 3 years Motor vehicles 3 years Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations. Property and equipment are reviewed for impairment whenever facts and circumstances indicate that the carrying value may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the fair value of the asset. The fair value is determined based on estimates of future cash flows, market value of similar assets, if available, or independent appraisals, if required. If the carrying amount of the long- lived asset is not recoverable from its undiscounted cash flows, an impairment loss is recognized for the difference between the carrying amount and fair value of the asset. When fair values are not available, the Company estimates fair value using the expected future cash flows discounted at a rate commensurate with the risk associated with the recovery of the assets. ● Impairment of Long-Lived Assets In accordance with the provisions of ASC Topic360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property and equipment owned and held by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cashflows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. No impairment losses were recognized for the three months ended March 31, 2026 and 2025. ● Accounts Payable Accounts payable primarily consists of (i) commission payable to the Company’s financial advisors for the sale of investment funds, investment products, or insurance products, accruals for payments of professional services fees and other operating payables and (ii) payable to the suppliers related to talent and influencers for brand activations and live-event. The carrying amount approximates fair value because of the short-term maturity. ● Borrowings Borrowings are initially recognized at fair value, net of upfront fees incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method. 9 ● Convertible Debts, net The Company accounts for certain convertible debts, net in accordance with ASC Topic 470-20, “ Debt with Conversion and Other Options ” (“ASC 470-20”), whereby the convertible instrument is initially accounted for as a single unit of account, unless it contains a derivative that must be bifurcated from the host contract in accordance with ASC Topic 815-15, “ Derivatives and Hedging – Embedded Derivatives ” or the substantial premium model in ASC 470-20 applies. Where the substantial premium model applies, the premium is recorded in additional paid -in capital. The resulting debt discount is amortized over the period during which the convertible debts is expected to be outstanding as additional non-cash interest expenses. Certain of the Company’s senior convertible debts are accounted for under the fair value option election in ASC 825 due to difference in its features. Under the fair value option election, the financial instrument is initially measured at its issue-date estimated fair value and subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The estimated fair value adjustment is presented within other income (expense) in the unaudited condensed consolidated statements of operations and comprehensive loss. The Company classifies its senior convertible notes and convertible promissory notes that are being valued under the fair value option election as Level 3 due to the lack of relevant observable market data over fair value inputs, such as the probability weighting of the various scenarios that can impact settlement of the arrangement. ● Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC Topic 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC Topic 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. Equity-classified For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance. Warrants classified as equity instruments are initially recognized at fair value and are not subsequently remeasured. The Company accounts for its (i) Public Warrants, and (ii) Replacement Warrants of Triller Group Warrants as equity. Liability-classified For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the unaudited condensed consolidated statements of operations and comprehensive loss. The Company accounts for its (i) SPAC Private Warrants, (ii) Common Warrants, and (iii) Warrants – Class A of Triller Group Warrants as liabilities. Warrants classified as liabilities are recorded at fair value and are remeasured at each reporting date until settlement. Changes in fair value is recognized as a component of change in fair value of warrant liability in the unaudited condensed consolidated statements of operations and comprehensive loss. Transaction costs allocated to warrants that are presented as a liability are immediately expensed in the unaudited condensed consolidated statements of operations and comprehensive loss. 10 ● Revenue Recognition The Company receives most of its non-interest income from contracts with customers, which are accounted for in accordance with Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASC Topic 606”). ASC Topic 606 provided the following overview of how revenue is recognized from the Company’s contracts with customers: The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price – The transaction price is the amount of consideration in a contract to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. Step 4: Allocate the transaction price to the performance obligations in the contract – Any entity typically allocates the transaction price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or service promised in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation – An entity recognizes revenue when (or as) it satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control of that good or service). The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A performance obligation may be satisfied at a point in time (typically for promises to transfer goods to a customer) or over time (typically for promises to transfer service to a customer). Certain portion of the Company’s income is derived from contracts with customers, and as such, the revenue recognized depicts the transfer of promised goods or services to its customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company considers the terms of the contract and all relevant facts and circumstances when applying this guidance. The Company’s revenue recognition policies are in compliance with ASC Topic 606, as follows: (a) Financial Services (i) Commission income: The Company earns commissions from the sale of investment products to customers, who are insurance companies and fund houses. The Company enters into commission agreements with customers which specify the key terms and conditions of the arrangement. Commissions are separately negotiated for each transaction and generally do not include rights of return, credits or discounts, rebates, price protection or other similar privileges, and typically paid on or shortly after the transaction is completed. Upon the purchase of an investment product by customer, the Company earns a commission from customers, calculated as a fixed percentage of the investment products acquired by its customers. The Company defines the “purchase of an investment product” for its revenue recognition purpose as the time when the customers referred by the Company has entered into a subscription contract with the relevant product provider and, if required, the customer has transferred a deposit to an escrow account designated by the Company to complete the purchase of the investment products. After the contract is established, there are no significant judgments made when determining the commission price. Therefore, commissions are recorded at point in time when the investment product is purchased. 11 The Company also facilitates the arrangement between insurance providers and individuals or businesses by providing insurance placement services to the insured and is compensated in the form of commission from the respective insurance providers. The Company primarily facilitates the placement of life, general and MPF insurance products. The Company determines that insurance providers are the customers. The Company primarily earns commission income arising from the facilitation of the placement of an effective insurance policy, which is recognized at a point in time when the performance obligation has been satisfied upon execution of the insurance policy as the Company has no future or ongoing obligation with respect to such policies. The commission fee rate, which is paid by the insurance providers, based on the terms specified in the service contract which are agreed between the Company and insurance providers for each insurance product being facilitated through the Company. The commission earned is equal to a percentage of the premium paid to the insurance provider. Commission from renewed policies is variable consideration and is recognized in subsequent periods when the uncertainty around variable consideration is subsequently resolved (e.g., when customer renews the policy). In accordance with ASC Topic 606, Revenue Recognition: Principal Agent Considerations , the Company evaluates the terms in the agreements with its channels and independent contractors to determine whether or not the Company acts as the principal or as an agent in the arrangement with each party respectively. The determination of whether to record the revenue in a gross or net basis depends upon whether the Company has control over the services prior to transferring it. Control is demonstrated by the Company which is primarily responsible for fulfilling the provision of placement services through the Company’s licensed insurance brokers to provide agency services. The commissions from insurance providers are recorded on a gross basis and commission paid to independent contractors or channel costs are recorded as commission expense in the unaudited condensed consolidated statements of operations and comprehensive loss. The Company also offers the sale solicitation of real estate property to the final customers and is compensated in the form of commissions from the corresponding property developers pursuant to the service contracts. Commission income is recognized at a point of time upon the sale contracts of real estate property is signed and executed. 12 (ii) Recurring Asset Management Service Fees: The Company provides asset management services to investment funds or investment product providers in exchange for recurring asset management service fees. Recurring asset management service fees are determined based on the types of investment products the Company distributes and are calculated as a fixed percentage of the fair value of the total investment of the investment products, calculated daily. These customer contracts require the Company to provide investment management services, which represents a performance obligation that the Company satisfies over time. After the contract is established, there are no significant judgments made when determining the transaction price. As the Company provides these services throughout the contract term, for the method of calculating recurring asset management service fees, revenue is calculated on a daily basis over the contract term, quarterly billed and recognized. Recurring service agreements do not include rights of return, credits or discounts, rebates, price protection, performance component or other similar privileges and the circumstances under which the fixed percentage fees, before determined, could be not subject to clawback. Payment of recurring asset management service fees are normally on a regular basis (typically monthly or quarterly). (iii) Loan Interest Income: The Company offers money lending services from loan origination in form of mortgage and personal loans. Interest income is recognized monthly in accordance with their contractual terms and recorded as interest income in the unaudited condensed consolidated statement of operations. The Company does not charge prepayment penalties from its customers. Interest income on mortgage and personal loans is recognized as it accrued using the effective interest method. Accrual of interest income on mortgage loans is suspended at the earlier of the time at which collection of an account becomes doubtful or the account becomes 180 days delinquent. Disaggregation of Revenue The Company has disaggregated its revenue from contracts with customers into categories based on the nature of the revenue. The following table presents the revenue streams disaggregated by nature and geographic location: For the three months ended March 31, 2026 2025 At a point in time Commissions $ 4,756 $ 4,416 Total revenue from the transfer of goods and services at a point in time 4,756 4,416 Over time Recurring asset management service fees 274 347 Loan interest income — 18 Total revenue from the transfer of goods and services over time 274 365 Total revenue $ 5,030 $ 4,781 For the three months ended March 31, By geography: 2026 2025 Hong Kong $ 5,030 $ 4,781 United States — — Others — — $ 5,030 $ 4,781 13 Contract Balances Receivables relate to customer contracts for which the performance obligation has been satisfied and payment is expected to be received in the next twelve months. The Company reviews the status of the then-outstanding accounts receivable on a customer-by-customer basis, taking into consideration the aging schedule of receivables, its historical collection experience, current information regarding the client, subsequent collection history, and other relevant data, in establishing the allowance for doubtful accounts. Accounts receivable are written off against the allowance for expected credit losses when the Company determines amounts are no longer collectible. As of March 31, 2026 and December 31, 2025, there were no contract assets and contract liabilities from the Company’s contracts with customers. For the three months ended March 31, 2026 and 2025, there were no revenues recognized relating to performance obligations satisfied or partially satisfied in prior periods. ● Operating Expense For Social Media and Streaming Platform Operating expense for social media and streaming platform related to the social media application primarily consists of expenses related to talent and influencers for brand activations. The live-event portion of cost of revenues relate to license fees, event rights fees, revenue sharing costs, production costs, and influencer costs, among others. ● Sales and Marketing Expense Sales and marketing expenses include the costs of advertising, promotions, seminars, and other programs. In accordance with ASC Topic 720-35, Advertising Costs , advertising costs are expensed as incurred. ● Comprehensive Loss ASC Topic 220, Comprehensive Income , establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive (loss) income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive (loss) income, as presented in the accompanying unaudited condensed consolidated statements of changes in stockholders’ deficit, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive (loss) income is not included in the computation of income tax expense or benefit. ● Employee Benefits Full time employees of the Hong Kong subsidiaries participate in a defined contribution Mandatory Provident Fund retirement benefit scheme under the Hong Kong Mandatory Provident Fund Schemes Ordinance. ● Income Taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, Income Taxes (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. 14 ASC Topic 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC Topic 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50 % likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. For the three months ended March 31, 2026 and 2025, the Company did not have any interest and penalties associated with tax positions. As of March 31, 2026 and December 31, 2025, the Company did not have any significant unrecognized uncertain tax positions. The Company is subject to tax in local and foreign jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the relevant tax authorities. ● Stock-Based Compensation The Company accounts for stock-based compensation in accordance with the fair value recognition provision of ASC Topic 718, Stock Compensation . The Company grants share awards, including common stock and restricted share units, to eligible participants. Stock-based compensation expense for share awards is measured at fair value on the grant date. The fair value of restricted stock with either solely a service requirement or with the combination of service and performance requirements is based on the closing fair market value of the common stock on the date of grant. Stock-based compensation expense is recognized over the requisite service period for time-vesting awards and, for awards with a performance condition, over the requisite service period if the performance condition is probable of achievement. For awards with graded vesting that are subject only to a service condition, the expense is recognized on a straight-line basis over the service period for the entire award. ● Net Loss Per Share In accordance with ASC 260, Earnings Per Share , basic net earnings (loss) per share is computed by dividing net income (loss) attributable to ordinary stockholders by the weighted average number of unrestricted common stock outstanding during the period using the two-class method. Under the two-class method, net income (loss) is allocated between common stock and other participating securities based on dividends declared (or accumulated) and participating rights in undistributed earnings as if all the earnings for the reporting period had been distributed. The Company’s holdback shares are participating securities because they are entitled to non-forfeitable dividends. Basic loss per common stock is computed by dividing net loss by the weighted-average number of common stock outstanding during the period. Diluted loss per share is computed by dividing net loss by the sum of the weighted average number of common stock outstanding and of potential dilutive securities (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common stock that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted loss per share. ● Leases Under ASU 2016-02, Leases (Topic 842) (“Topic 842”), leases are categorized as operating or financing lease at inception. Lease assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Lease terms include options to renew or terminate the lease when it is reasonably certain that the Company will exercise such options. The Company has recognized right of use (“ROU”) assets and corresponding lease liabilities on the Company’s unaudited condensed consolidated balance sheets for its operating lease agreements with contractual terms greater than 12 months. Lease liabilities are based on the present value of remaining lease payments over the lease term. As the discount rate implied in the Company’s leases is not readily determinable, the present value is calculated using the Company’s incremental borrowing rate, which is estimated to approximate the interest rate on a collateralized basis with similar terms. Some of the Company’s lease agreements contain lease and non-lease components. Non-lease components primarily include payments for maintenance and utilities. The Company has elected the practical expedient to combine fixed payments for non-lease components with lease payments and account for them together as a single lease component which increases the amount of ROU assets and lease liabilities. Leases with a term of twelve months or less upon the commencement date are considered short-term leases, are not included on the unaudited condensed consolidated balance sheets and are expensed on a straight-line basis over the lease term. 15 ● Related Parties The Company follows the ASC Topic 850-10, Related Party for the identification of related parties and disclosure of related party transactions. Pursuant to section 850-10-20, the related parties include: a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which statements of operations are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which statements of operations are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. ● Commitments and Contingencies The Company follows the ASC Topic 450-20, Contingencies, to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. ● Fair Value Measurement The Company follows the guidance of the ASC Topic 820-10, Fair Value Measurements and Disclosures (“ASC Topic 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC Topic 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows: ● Level 1 : Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets; 16 ● Level 2 : Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and ● Level 3 : Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models. The carrying value of the Company’s financial instruments: cash and cash equivalents, restricted cash, accounts receivable, deposits, prepayments and other receivables, accounts payable and accrued liabilities, escrow liabilities, borrowings, and amounts due to stockholder approximate at their fair values because of the short-term nature of these financial instruments. The Company measures warrant liabilities, certain convertible debts for which the fair value option has been elected at fair value on a recurring basis. The following table presents information about the Company’s financial assets and liabilities that were measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. As of March 31, Quoted prices in active markets Significant other observable inputs Significant other unobservable inputs Description 2026 (Level 1) (Level 2) (Level 3) Assets: Marketable equity securities $ — * $ — * $ — $ — Long-term investments (a) 19,444 — — 19,444 Long-term investments, related party $ 520 $ — $ — $ 520 Liabilities: Warrant liabilities $ — $ — $ — $ — Convertible debts for which the fair value option has been elected (b) $ 59,722 $ — $ — $ 59,722 * Less than $1,000 As of December 31, Quoted prices in active markets Significant other observable inputs Significant other unobservable inputs Description 2025 (Level 1) (Level 2) (Level 3) Assets: Marketable equity securities $ 1 $ 1 $ — $ — Long-term investments (a) 19,753 — — 19,753 Long-term investments, related party $ 524 $ — $ — $ 524 Liabilities: Warrant liabilities $ — $ — $ — $ — Convertible debts for which the fair value option has been elected (b) $ 59,722 $ — $ — $ 59,722 Note: (a) Long-term investments are measured at fair value which are estimated using the market approach, based on valuation multiples derived from comparable companies, adjusted for size and risk. The significant unobservable inputs used in the valuation include market multiples ranging from 0.83 to 10.70 and a discount for lack of marketability of 12.95 %. 17 (b) Certain of the Company’s senior convertible notes and convertible promissory notes are accounted for under the fair value option election in ASC 825. Under the fair value option election, the financial instrument is initially measured at its issue-date estimated fair value and subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The estimated fair value adjustment is presented within other income (expense) in the condensed consolidated statements of operations and comprehensive loss. The fair value was estimated using a binomial option pricing model, which incorporates probability-weighted outcomes and considers the contractual terms of the instruments, including conversion features and settlement scenarios. The estimated fair value of the convertible debts as of March 31, 2026 was computed using the models and assumptions shown below. There was no movement for the three months ended March 31, 2026 and 2025. The significant unobservable inputs in the valuation models as of March 31, 2026, are as follows: Inputs Convertible debts A Convertible debts B Valuation method Binomial Option Pricing Model Binomial Option Pricing Model Conversion price $ 8.36 $ 9.00 Expected volatility 61.74 % 61.74 % Discount rate 23.48 % 23.48 % Risk free rate 3.48 % 3.48 % These inputs involve significant judgment and are subject to estimation uncertainty. Changes in significant assumptions, particularly discount rates, volatility, and comparable company multiples, could have a material impact on the estimated fair values. The company performed sensitivity analyses on key assumptions, which indicated that reasonable changes in these inputs could result in materially different fair value measurements. ● Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standard Board (“FASB”) or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In November 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires incremental disclosures about specific expense categories, including but not limited to, purchases of inventory, employee compensation, depreciation, amortization and selling expenses. The amendments are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted and the amendments may be applied either prospectively or retrospectively. Management is currently evaluating this ASU to determine its impact on the Company’s disclosures. In January 2025, the FASB issued ASU 2025-01 Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40). The FASB issued ASU 2024-03 on November 4, 2024. ASU 2024-03 states that the amendments are effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Following the issuance of ASU 2024-03, the FASB was asked to clarify the initial effective date for entities that do not have an annual reporting period that ends on December 31 (referred to as non-calendar year-end entities). Because of how the effective date guidance was written, a non-calendar year-end entity may have concluded that it would be required to initially adopt the disclosure requirements in ASU 2024-03 in an interim reporting period, rather than in an annual reporting period. The FASB’s intent in the basis for conclusions of ASU 2024-03 is clear that all public business entities should initially adopt the disclosure requirements in the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Management is currently evaluating this ASU to determine its impact on the Company’s disclosures. In July 2025, the FASB issued 2025-05 to improve the measurement of credit losses for accounts receivable and contract assets. The guidance provides a practical expedient for all entities to assume that current conditions as of the balance sheet date remain unchanged for the remaining life of the assets. The update aims to reduce the cost and complexity of estimating credit losses while maintaining decision-useful information for financial statement users. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025. Management is currently evaluating the impact that the adoption of this update may have on its financial statements. In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements . This update clarifies the applicability, form and content, and interim disclosure requirements in ASC Topic 270 and enhances navigability of the interim reporting guidance. The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, for public business entities and after December 15, 2028, for entities other than public business entities. Early adoption is permitted. Management is currently evaluating this ASU to determine its impact on the Company’s disclosures. 18 In December 2025, the FASB issued ASU 2025-12, “ Codification Improvements ,” which updates the FASB Accounting Standards Codification to clarify, correct errors, and improve the overall usability of GAAP. The improvements consist of narrow-scope amendments, technical corrections, clarification of existing guidance, and updates to clarify the appropriate scope and application of certain disclosure requirements. ASU 2025-12 is effective for annual and interim periods beginning after December 15, 2026. Early adoption is permitted. Management is currently evaluating this ASU to determine its impact on the Company’s disclosures. Except for the above-mentioned pronouncements, there are no new recent issued accounting standards that will have a material impact on the unaudited condensed consolidated balance sheets, statements of operations and cash flows. NOTE 3 — LIQUIDITY AND GOING CONCERN The accompanying unaudited condensed consolidated financial statements were prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. They do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. For the three months ended March 31, 2026, the Company reported net loss of approximately $ 32.2 million and net cash outflows from operating activities of approximately $ 2.8 million. As of March 31, 2026, the Company had a working capital deficit of approximately $ 366.4 million, stockholders’ deficit of approximately $ 348.6 million and cash and cash equivalents balance of approximately $ 2.2 million for working capital purposes. The Company is also exposed to legal and regulatory matters, as disclosed in Note 16, which may result in additional defense and settlement costs. Unfavorable outcomes could further strain the Company’s liquidity. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid certain short-term loans, TFI Note, exchangeable notes and convertible promissory notes, all of which are past due and considered in default. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the date of issuance of these unaudited condensed consolidated financial statements. The management of the Company has developed a funding plan intended to support the Company’s liquidity and enable it to meet its operating obligations as they fall due. Management continues to monitor the Company’s capital structure and operating plans and will evaluate available funding alternatives as needed. Details of the funding plan are as follows: Fund raising project Target timeline Target amount PIPE / rights issue April – June 2026 $ 40 million – $ 50 million Convertible notes September 2026 $ 150 million – $ 200 million New equity issuance 2027 $ 200 million Management’s ability to execute its near-term funding plans and liquidity measures is important to the Company’s continued operation as a going concern. After considering the cash flow forecast, the funding initiatives under evaluation, management’s ability to defer or restructure certain obligations, and its ability to manage liquidity closely during the assessment period, management believes that the going concern basis of preparation remains appropriate. Management continues to monitor the Company’s liquidity position closely and update this assessment through the issuance of the accompanying unaudited condensed consolidated financial statements. However, the Company cannot predict the exact amount or timing of the alternatives or guarantee those alternatives will be favorable to its stockholders. Any failure to obtain financing when required will have a material adverse impact on the Company’s business, operation and financial result. 19 NOTE 4 — SEGMENT INFORMATION By assessing the qualitative and quantitative criteria established by ASC Topic 280, “Segment Reporting” , management has determined that the Company has four reportable segments, which include the Company’s social media, sports streaming, and financial services segments. The Company’s reportable segments reflect how the Company’s operations are managed, how the Company’s Chief Executive Officer , who is the Chief Operating Decision Maker (“CODM”), allocates resources and evaluates performance, and how the Company’s internal financial reporting is structured. For the three months ended March 31, 2026 and 2025, the Company’s reportable segments comprised of the following: 1. Social media The Social Media segment consists of the Company’s operations related to its social media platform and related services for content creation and distribution. 2. Sports streaming The online streaming segment consists of the Company’s operations related to its online streaming services. 3. Financial services The Financial Services segment consists of revenues and costs incurred from the sale of investment products, offer asset management services and money lending services. The Company's reportable segments are strategic business units that offer different products and services. They are managed separately because each business unit requires different technology and marketing strategies. The following tables present the summary information by segment for the three months ended March 31, 2026 and 2025: For the three months ended March 31, 2026 Social media Sports streaming Financial services Corporate Elimination Consolidated Revenue Commission — — 4,756 — — 4,756 Recurring asset management service fees — — 274 — — 274 Total revenue — — 5,030 — — 5,030 Operating expenses Commission expense — — ( 3,470 ) — — ( 3,470 ) Sales and marketing expense ( 48 ) — ( 32 ) ( 154 ) — ( 234 ) Research and development expense ( 313 ) — ( 222 ) — — ( 535 ) Personal and benefit expense ( 2,781 ) ( 655 ) ( 23 ) ( 12,989 ) — ( 16,448 ) Legal and professional fee ( 7,180 ) ( 71 ) ( 85 ) ( 450 ) — ( 7,786 ) Office and operating fee, related party — — — ( 663 ) — ( 663 ) Provision for allowance for expected credit losses — — ( 2 ) — — ( 2 ) Other general and administrative expenses ( 37 ) ( 39 ) ( 3,518 ) ( 18 ) — ( 3,612 ) Total operating expenses ( 10,359 ) ( 765 ) ( 7,352 ) ( 14,274 ) — ( 32,750 ) Other income (expense) Interest income — — 2 — — 2 Interest expense ( 3,253 ) ( 10 ) ( 599 ) ( 638 ) — ( 4,500 ) Foreign exchange gain (loss), net — ( 20 ) 6 ( 198 ) — ( 212 ) Bad debts recovered — — 256 — — 256 Sundry income (expense) — — 338 ( 324 ) — 14 Total other income (expense), net ( 3,253 ) ( 30 ) 3 ( 1,160 ) — ( 4,440 ) Income tax expense — — ( 52 ) — — ( 52 ) Net loss ( 13,612 ) ( 795 ) ( 2,371 ) ( 15,434 ) — ( 32,212 ) 20 For the three months ended March 31, 2025 Social media Sports streaming Financial services Corporate Elimination Consolidated Revenue Loans interest income — — 18 — — 18 Commission — — 4,416 — — 4,416 Recurring asset management service fees — — 347 — — 347 Total revenue — — 4,781 — — 4,781 Operating expenses Commission expense — — ( 2,521 ) — — ( 2,521 ) Research and development expense ( 1,189 ) ( 187 ) ( 45 ) ( 281 ) — ( 1,702 ) Personal and benefit expense ( 3,889 ) ( 621 ) ( 75 ) ( 30,379 ) — ( 34,964 ) Legal and professional fee — — — ( 5,838 ) — ( 5,838 ) Office and operating fee, related party — — — ( 1,178 ) — ( 1,178 ) Provision for allowance for expected credit losses — — ( 47 ) — — ( 47 ) Other general and administrative expenses ( 4,400 ) 109 ( 1,689 ) 3,247 — ( 2,733 ) Total operating expenses ( 9,478 ) ( 699 ) ( 4,377 ) ( 34,429 ) — ( 48,983 ) Other income (expense) Interest income 165 — 2 — — 167 Interest expense ( 2,418 ) ( 356 ) ( 161 ) ( 1,868 ) — ( 4,803 ) Foreign exchange gain, net — — 1,145 — — 1,145 Bad debts written-off ( 5,441 ) — — — — ( 5,441 ) Sundry income — — 106 — — 106 Total other income (expense), net ( 7,694 ) ( 356 ) 1,092 ( 1,868 ) — ( 8,826 ) Income tax expense — — ( 24 ) — — ( 24 ) Net income (loss) ( 17,172 ) ( 1,055 ) 1,472 ( 36,297 ) — ( 53,052 ) The following tables present a summary of the Company’s revenues from external customers by geographic regions, for each reportable segment for the three months ended March 31, 2026 and 2025: For the three months ended March 31, 2026 Social media Sports streaming Financial services Corporate Elimination Consolidated Revenue by geographic regions: Hong Kong $ — $ — $ 5,030 $ — $ — $ 5,030 United States — — — — — — Others — — — — — — Total revenue $ — $ — $ 5,030 $ — $ — $ 5,030 For the three months ended March 31, 2025 Social media Sports streaming Financial services Corporate Elimination Consolidated Revenue by geographic regions: Hong Kong $ — $ — $ 4,781 $ — $ — $ 4,781 United States — — — — — — Others — — — — — — Total revenue $ — $ — $ 4,781 $ — $ — $ 4,781 21 The following tables present a summary of the Company’s assets by reportable segment as of March 31, 2026 and December 31, 2025: As of March 31, 2026 Social media Sports streaming Financial services Corporate Elimination Consolidated Long-term investments, net $ — $ — $ 19,964 $ — $ — $ 19,964 Other assets, net 28 371 9,980 3,938 — $ 14,317 Total assets $ 28 $ 371 $ 29,944 $ 3,938 $ — $ 34,281 As of December 31, 2025 Social media Sports streaming Financial services Corporate Elimination Consolidated Long-term investments, net $ — $ — $ 20,277 $ — $ — $ 20,277 Other assets, net 14 476 10,685 4,053 — 15,228 Total assets $ 14 $ 476 $ 30,962 $ 4,053 $ — $ 35,505 As of March 31, 2026 and December 31, 2025, the Company’s long-lived assets are located in Hong Kong because the invested companies are Hong Kong-based companies. NOTE 5 — RESTRICTED CASH As of March 31, 2026 and December 31, 2025, the Company has approximately $ 9.9 million and $ 10.3 million fund held in escrow, respectively. Fund held in escrow primarily comprised of escrow funds held in bank accounts on behalf of the Company’s customers. The Company is currently acted as a custodian to manage the assets and investment portfolio on behalf of its customers under the terms of certain contractual agreements, which the Company does not have the right to use for any purposes, other than managing the portfolio. Upon receiving escrow funds, the Company records a corresponding escrow liability. NOTE 6 — ACCOUNTS RECEIVABLE, NET Accounts receivable, net consisted of the following: As of March 31, 2026 December 31, 2025 Accounts receivable $ 994 $ 1,026 Less: allowance for expected credit losses ( 107 ) ( 107 ) Accounts receivable, net $ 887 $ 919 The Company generally conducts its business with creditworthy third parties. The Company determines, on a quarterly basis, the probable losses and an allowance for expected credit losses determined in accordance with the CECL model, based on historical losses, current economic conditions, forecasted future economic and market considerations, and in some cases, evaluating specific customer accounts for risk of loss. Accounts receivable are written off after exhaustive collection efforts occur and the receivable is deemed uncollectible. In addition, receivable balances are monitored on an ongoing basis and its exposure to bad debts is not significant. For the three months ended March 31, 2026 and 2025, the Company has assessed the probable loss and no provision for allowance for expected credit losses were provided. For the three months ended March 31, 2026 and 2025, the Company has written off accounts receivable of $0.0 and $ 3.3 million, respectively against the allowance for expected credit losses as they were determined to be uncollectible. For the three months ended March 31, 2026 and 2025, the Company has bad debts recovery of $ 0.3 million and $ 0.0 , respectively. 22 NOTE 7 — LONG-TERM INVESTMENTS, NET Long-term investments, net consisted of the following: As of Ownership interest March 31, 2026 Ownership interest December 31, 2025 Marketable equity securities: Investment C 0.00 %* — ** 0.00 %* 1 Non-marketable equity securities: Investment A 9.98 % 6,068 9.98 % 6,191 Investment B 3.30 % 253 3.30 % 254 Investment D 4.30 % 10,549 4.30 % 10,733 Investment E, related party 4.00 % 520 4.00 % 524 Investment G 27.98 % — 27.98 % — Investment H 3.36 % 2,574 3.36 % 2,574 Net carrying value $ 19,964 $ 20,277 * Less than 0.001% ** Less than $1,000 Investments in Marketable Equity Securities Investments in equity securities, such as, marketable securities, are accounted for at its current market value with the changes in fair value recognized in net gain (loss). Investment C was listed and publicly traded on Nasdaq Stock Exchange. Investments in Non-Marketable Equity Securities Investments in non-marketable equity securities consist of investments in limited liability companies in which the Company’s interests are deemed minor and long-term, strategic investments in companies that are in various stages of development, and investments in a close-ended partnership funds which concentrated in the healthcare sector. These investments do not have readily determinable fair values and, therefore, are reported at cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. Management assesses each of these investments on an individual basis, subject to a periodic impairment review and considers qualitative and quantitative factors including the investee’s financial condition, the business outlook for its products and technology, its projected results and cash flow, financing transactions subsequent to the acquisition of the investment, the likelihood of obtaining subsequent rounds of financing and cash usage. The Company is not required to determine the fair value of these investments unless impairment indicators existed. When an impairment exists, the investment will be written down to its fair value by recording the corresponding charge as a component of other income (expense), net. Fair value is determined by an independent valuer using the market-based approach, utilizing observable inputs, including relevant market data and comparable market transactions. The following table presents the movement of non-marketable equity securities as of March 31, 2026 and December 31, 2025: As of March 31, 2026 December 31, 2025 Balance at beginning of period/year $ 20,277 $ 25,455 Adjustments: Downward adjustments — ( 7,086 ) Foreign exchange adjustment ( 313 ) 1,908 ) Balance at end of period/year $ 19,964 $ 20,277 Cumulative unrealized gains and losses, included in the carrying value of the Company’s non-marketable equity securities As of March 31, 2026 December 31, 2025 Downward adjustments (including impairment) $ ( 60,404 ) $ ( 60,404 ) Upward adjustments 6,209 6,209 Total $ ( 54,195 ) $ ( 54,195 ) 23 NOTE 8 — BORROWINGS The borrowings consisted of the followings: As of March 31, 2026 December 31, 2025 Short-term loans (a) $ 11,288 $ 11,483 Short-term loans, related parties (b) 51,265 48,959 Factoring loan (c) — 1 Total $ 62,553 $ 60,443 Notes: (a) Short-term Loans In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, which includes the short-term notes assumed at an aggregate principal amount of $ 11.0 million issued to various lenders (collectively, the “Short-term Loans”). The Short-term Loans bear interest at the rates ranging from 1.00 % to 193.59 % per annum, which will mature at various dates within the next twelve months and are secured by all assets of the Company. In the event of a default, penalty interest is levied at rates ranging from 1.00 % to 193.59 % per annum. The Company incurred approximately $ 2.8 million and $ 0.02 million in interest expense on the various short-term loans during the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026 and December 31, 2025, the aggregate outstanding loans balance was approximately $ 11.3 million and $ 11.5 million, respectively and are included as current liabilities in the accompanying unaudited condensed consolidated balance sheets. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. (b) Short-term Loans, Related Parties In September 2023, the Company obtained short-term loans of approximately $ 5.0 million from Giant Wisdom Ventures Limited, a company controlled by major stockholder of the Company, which bears interest at a fixed rate of 12 % per annum, repayable in October 2023. The borrowing is secured by a lien on the partial equity interest in Investment D owned by the Company. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, which includes the borrowing entered with De Silva 2000 Living Trust for a principal of approximately $ 0.2 million with a fixed interest rate of 1.85 % per annum. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. In October 2024, the Company entered into a loan facility agreement with one of its stockholders, TAG Holding Limited for borrowings up to $ 30.0 million. The loan is unsecured, repayable on demand and bears interest at a fixed rate of 6 % per annum. On October 16, 2024, Triller Corp. entered into a short-term loan agreement with Giant Wisdom Ventures Limited for a principal of approximately $ 5.0 million with a fixed interest rate of 18 % per annum. The loan is guaranteed by Triller Group and is collateralized by 5,000,000 shares of BKFC common stock. Both principal and accrued interest are due on January 16, 2025. In the event of a default, the interest rate increases to 21 % per annum. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. On March 21, 2025, the Company entered into short-term loan agreements with Giant Wisdom Ventures Limited for aggregate principal of $ 15.5 million with a fixed interest rate of 8 % per annum and repayable in June and July 2025. The loans are guaranteed by Triller Hold Co LLC and secured by a pledge of 1,400,000 shares of common stock of BKFC owned by the Company. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. 24 On March 4, 2026, the Company obtained a short-term loan of $ 0.4 million from Capital Truth Holdings Ltd. bearing interest at a fixed rate of 6 % per annum, unsecured, and repayable in September 2026. On March 19, 2026, the Company obtained a short-term loan of $ 1.5 million from Giant Wisdom Ventures Limited which bears interest at a fixed rate of 6 % per annum, repayable in September 2026. The interest rate increases to 9 % per annum upon default. The borrowing is secured by a pledge of 74,735,789 shares of Investment D owned by the Company. The Company obtained aggregate short-term loans of approximately $ 1.1 million from its Chief Operating Officer (“COO”), bearing interest at 6 % per annum, unsecured, and repayable within twelve months. The interest rate increases to 15 % per annum upon default. The holder has the option to settle the loan either through cash repayment or by receiving a fixed number of shares of the Company’s common stock. The Company issued aggregate 798,000 shares of common stock to the COO for partial repayment of these loans in prior years. During the three months ended March 31, 2026, the Company fully repaid the remaining outstanding loan balance of approximately $ 0.6 million in cash As of March 31, 2026 and December 31, 2025, the aggregate outstanding loans balance was approximately $ 51.3 million and $ 49.0 million, respectively. (c) Factoring loan In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp.’s subsidiary, Flipps Media Inc. (“Flipps”), which included certain sale of future receipts agreements (the “Agreements”) entered with certain third-party financing companies in October 2024. Pursuant to the Agreements, Flipps sold its future receipts of approximately $ 0.6 million for a principal amount of approximately $ 0.4 million. Flipps recorded a debt discount of approximately $ 0.03 million for the loan origination fees. The debt discount was amortized over the term of the loans with a range of four to twelve-month periods. The agreed weekly payment was approximately $ 0.03 million. As of March 31, 2026 and December 31, 2025, the outstanding principal balance, net of debt discount, was approximately $ 0.0 and $ 0.001 million, respectively. NOTE 9 — CONVERTIBLE DEBTS (i) TFI Note In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, which includes convertible notes issued to Total Formation Inc. (“TFI”), stockholder of the Company, with a total principal balance of approximately $ 35.3 million and fair value of approximately $ 46.3 million (the “TFI Note”) as of the Acquisition Date. The TFI Note bears 15 % annual interest and payable on demand by TFI at any time on or after August 1, 2024. The Company may prepay any amount owed under the note in whole or in part at any time without penalty or premium, plus unpaid accrued interest as of the date of such repayment. In the event that the Company fails to pay any amount due under this note when due or if the Company commences any case, proceeding, or other action relating to bankruptcy, insolvency, or reorganization, these events will constitute an event of default. An event of default will result in TFI having the option, by written notice to the Company, to declare the entire principal amount, together with all accrued but unpaid interest, payable immediately. If any amount payable under this TFI Note is not paid when due, such overdue amount shall bear interest at the default rate of 16 % from the date of such non-payment until such amount is paid in full. As of March 31, 2026 and December 31, 2025, the TFI Note was reported at a fair value of approximately $ 59.7 million and $ 59.7 million, respectively, which is included in convertible debts under current liabilities in the unaudited condensed consolidated balance sheets. For the three months ended March 31, 2026 and 2025, there was no change in fair value of convertible debts in the unaudited condensed consolidated statements of operations and comprehensive loss. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. (ii) Exchangeable Note On October 16, 2024, the Company issued an exchangeable note of approximately $ 5.4 million to Giant Wisdom Ventures Limited which bears interest at a fixed rate of 15 % per annum and mature on January 16, 2025. The note is secured by a pledge of 5,000,000 shares of common stock of BKFC owned by the Company. As of March 31, 2026 and December 31, 2025, the fair value of the note is approximately $ 7.0 million and $ 7.0 million, respectively. As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. 25 (iii) Convertible Promissory Note - Yorkville On April 25, 2024, the Company entered into an amended and restated standby equity purchase agreement (the “First A&R SEPA”) with YA II PN, LTD, a Cayman Islands exempt limited partnership (“Yorkville”), and Triller Corp. In connection with the A&R SEPA, Yorkville agreed to an advance to the Triller Corp in the form of convertible promissory notes in a principal amount up to approximately $ 8.51 million (the “First Pre-Paid Advance”). The First Pre-Paid Advance amounted to 94.0 % of the principal amount to be drawn down. Interest shall accrue on the outstanding balance at an annual rate of 5 %, subject to an increase to 18 % upon an event of default as described in the agreement. The maturity date is 12 months after its issuance date. On June 28, 2024, the Company, Triller Corp and Yorkville entered into the Second A&R SEPA to modify the First A&R SEPA dated April 25, 2024. Pursuant to the Second A&R SEPA, Yorkville provides to the Company financing in the principal amount of $ 25 million (the “Second Pre-Paid Advance”) in the form of an additional convertible promissory note, subject to the same terms in interest charge and maturity under the First Pre-Paid Advance. The Second Pre-Paid Advance amounted to 94.0 % of the principal amount to be drawn down. Yorkville may convert the First Pre-Paid Advance and Second Pre-Paid Advance into the common shares at any time after the Merger at a fixed conversion price equal to (i) the principal amount and interests, divided by (ii) the determination of the lower of (a) 100 % of the volume weighted average price (“VWAP”) during the ten trading days preceding the closing date of the Merger (the “Fixed Price”), or (b) 92.5 % of the lowest daily VWAP during the 10 consecutive trading days immediately preceding the conversion date or other date of determination (the “Variable Price”), provided that the Variable Price shall not be lower than the Floor Price. The “Floor Price”, solely with respect to the Variable Price, shall be equal to (i) a price equal to 40 % of the average of the VWAPs during the ten ( 10 ) trading days immediately preceding the closing date of the Merger, and (ii) from and after the date of effectiveness of the initial registration statement, 40 % of the VWAP of the trading day immediately prior to the date of effectiveness of the initial registration statement, if such price is lower than the price in part (i) of this sentence. On July 2, 2024, the Company received approximately $ 23.35 million, net of approximately $ 0.15 million legal and professional fee as direct issuance costs incurred in arranging the Second A&R SEPA, from Yorkville. On June 20, 2025, Yorkville effected a foreclosure under the Triller Pledge Agreement. This action was undertaken by Yorkville following its allegations of various events of default by the Company under the terms of the Yorkville Convertible Promissory Note, dated June 28, 2024, and other related transaction documents, including the Second A&R SEPA. Yorkville had previously sought to accelerate payment of all amounts due under the Yorkville Convertible Promissory Note. Although the Company has not received a formal notice of foreclosure from Yorkville, the Company became aware through a transfer agent statement that 3,000,000 shares of common stock of BKFC, previously pledged by Triller Hold Co LLC as collateral, were transferred to Yorkville on June 20, 2025. These 3,000,000 shares represented a 17.66 % ownership interest in BKFC as specifically pledged to Yorkville as of June 20, 2025. As a direct result of this transfer, the Company’s beneficial ownership in BKFC became 38.13 %, based on BKFC’s total outstanding common shares. Following this change in ownership, the majority stockholders of BKFC approved amendments to BKFC’s certificate of incorporation and its Stockholders Agreement, which included the removal of the Company’s board designation rights. These amendments became effective on July 1, 2025. As of March 31, 2026 and December 31, 2025, the Company issued convertible promissory notes in an aggregate of approximately $ 36.7 million and $ 36.3 million to Yorkville, respectively. Common Warrants to Yorkville Also, pursuant to the First A&R SEPA and Second A&R SEPA, the Company issued a warrant (the “Common Warrant”) to Yorkville to purchase up to a number of shares of common stock of the Company equal to 25 % of the principal amount of the aggregated pre-paid advances divided by a price equal to the Fixed Price, each such Common Warrant with an exercise price equal to the Fixed Price. On June 28, 2024, the Company issued 1,431,561 common warrants to Yorkville at a fixed exercise price of $ 5.85 per share (see Note 10). The Company analyzed the conversion feature of the agreement for derivative accounting consideration under ASC 815 and determined that the embedded conversion features should be classified as a derivative because the exercise price of these convertible notes are subject to a variable conversion rate. The Company has determined that the conversion feature is not considered to be solely indexed to the Company’s own shares and is therefore not afforded equity treatment. 26 The Company recorded amortization of debt discount and direct issuance costs and accrued interest of convertible promissory notes payable in interest expense in the unaudited condensed consolidated statements of operations and comprehensive loss of approximately $ 0.4 million and $ 1.4 million for the three months ended March 31, 2026 and 2025, respectively. On November 26, 2024, Yorkville initiated litigation against Triller, Triller Corp., Triller Hold Co LLC, and Convoy Global Holdings Limited (“Defendants”) by filing a motion for summary judgment in lieu of a complaint pursuant to NY CPLR 3213 (the “Motion”), seeking a judgment finding Defendants liable for all amounts allegedly owed under the convertible promissory note, including interest, plus costs, legal fees, and expenses incurred by Yorkville (see Note 16). As of the date of issuance of these unaudited condensed consolidated financial statements, the Company has not repaid the amount due and considered default of settlement. NOTE 10 — WARRANTS In connection with the merger transaction completed on October 15, 2024, the exercise prices for, and the shares underlying, all previously outstanding public warrants (“AGBA Public Warrants”), Class A warrants (“AGBA Class A Warrants”), and common warrants (“AGBA Common Warrants”) (collectively, “AGBA Warrants”) issued by AGBA were adjusted in accordance with the terms of such warrant instruments to reflect the previously announced and implemented 1.9365-to-1 Forward Split and 1-for-4 Reverse Split . An equitable adjustment with a combined ratio of 0.5:1 applied to the number of AGBA Ordinary Shares issuable on the exercise of each AGBA Warrants and the warrant price. Upon the closing, all warrants issued by AGBA and Triller Corp. were assigned to and assumed by Triller Group (“Triller Group Warrants”). Accordingly, as of the close of business acquisition on October 15, 2024, each AGBA Public Warrant and each AGBA SPAC Private Warrant became one Triller Group Warrant which entitles the holder thereof to purchase 0.25 shares of Triller Group Common Stock at an adjusted exercise price of $ 23.00 per whole share (provided, however, warrants are not exercisable for fractional shares, only whole shares; thereby a warrant holder would need to hold four warrants to yield one share). Each AGBA Class A Warrant and each AGBA Common Warrant became one Triller Group Warrant which entitles the holder thereof to purchase 0.5 shares of Triller Group Common Stock at an adjusted exercise price of two times of the original exercise price per whole share (provided, however, warrants are not exercisable for fractional shares, only whole shares; thereby a warrant holder would need to hold two warrants to yield one share). AGBA Public Warrants started trading on a post-adjustment basis as Triller Group Warrants on October 16, 2024 under the new ticker symbol “ILLRW”. All the warrants and their exercise prices are retroactively restated in effect to the forward stock split and reverse stock split. The Company has issued different classes of warrants, as follows: Equity Classified Warrants (a) Public Warrants Each public warrant entitles the holder thereof to purchase one-quarter (1/4) of one share of common stock at a price of $ 23.00 per full share, subject to adjustment as discussed herein. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares. This means that only an even number of warrants may be exercised at any given time by a warrant holder. Once the warrants become exercisable, the Company may call the outstanding warrants (including any outstanding warrants issued upon exercise of the unit purchase option issued to Maxim Group LLC) for redemption: ● in whole and not in part; ● at a price of $ 0.01 per warrant; ● upon a minimum of 30 days’ prior written notice of redemption, ● if, and only if, the last sales price of the common stock equals or exceeds $ 16.50 per share for any 20 trading days within a 30 trading day period ending three business days before the Company send the notice of redemption, and ● if, and only if, there is a current registration statement in effect with respect to the common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. 27 If the Company calls the warrants for redemption as described above, the management of the Company will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.” In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of common stock equal to the quotient obtained by dividing (x) the product of the number of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market value” (defined below) by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether the Company will exercise its option to require all holders to exercise their warrants on a “cashless basis” will depend on a variety of factors including the price of its common stock at the time the warrants are called for redemption, the Company’s cash needs at such time and concerns regarding dilutive share issuances. The public warrants qualify for the derivative scope exception under ASC 815 and are therefore presented as a component of stockholders’ (deficit) equity on the unaudited condensed consolidated balance sheets without subsequent fair value re-measurement. As of March 31, 2026 and December 31, 2025, there were 4,600,000 and 4,600,000 public warrants of Triller Group Warrants outstanding. (b) Replacement Warrants On October 15, 2024, pursuant to the Merger Agreement, the Company issued 14,811,260 Triller Group Replacement Warrants to replace Triller Corp. warrants. Each replacement warrant entitles the holder thereof to purchase one share of common stock at a price range from approximately $ 0.03 to $ 26.70 per full share, subject to adjustment as discussed herein. The replacement warrants may be exercised in full or in part during the exercise period from the issue date to 2028. The holders will have the option to exercise warrants on a “cashless exercise.” In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of shares equal to the quotient obtained by dividing (x) the product of the number of shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market value” (defined below) by (y) the fair market value. The “fair market value” shall mean the volume average reported last sale price of the shares for the 10 trading days prior to the exercise date. As of March 31, 2026 and December 31, 2025, there were 13,983,298 and 13,983,298 replacement warrants of Replacement Warrants outstanding, respectively. Liability Classified Warrants (a) Warrant - Class A On May 2, 2024, the Company issued 3,557,932 shares of common stock and the associated warrants to purchase up to 734,920 shares of common stock at a purchase price of $ 1.40 per share under the private placement, to an institutional investor, a director, officers and employees of the Company. The subscribers in private placement will receive one Warrant – Class A for every five shares of common stock subscribed. Each Warrant – Class A entitles the holder to purchase 0.5 share of common stock at an exercise price of $ 2.00 per share and shall be exercised with more than $ 500,000 per tranche. The warrants will be exercisable six months after the issuance date for a period of five years after the exercise date. As of March 31, 2026 and December 31, 2025, there were 1,469,840 and 1,469,840 Warrants - Class A of Triller Group Warrants outstanding, respectively. (b) Common Warrants On June 28, 2024, the Company issued 1,431,561 common warrants to Yorkville, in connection with the Second A&R SEPA (see Note 12(iii)). Each common warrant entitles the holder to purchase 1 share of common stock with an exercise price of $ 5.85 per share. As of March 31, 2026 and December 31, 2025, there were 1,431,561 and 1,431,561 common warrants of Triller Group Warrants outstanding, respectively. 28 The Company has accounted for and presented Warrant – Class A and Common Warrants as liabilities on the unaudited condensed consolidated balance sheets, in accordance with ASC 480. The fair value of the warrant liabilities is valued by an independent valuer using a Binominal pricing model. The warrant liabilities were classified as Level 3 due to the use of unobservable inputs. The key inputs into the Binominal pricing model were as follows at their measurement dates: As of March 31, 2026 Common Warrants Warrants – Class A Input Share price $ 0.03 $ 0.03 Risk-free interest rate 4.23 % 3.59 – 3.62 % Volatility 50.89 % 54.68 – 55.09 % Exercise price $ 2.83 $ 2.00 Warrant remaining life (years) 3.24 3.35 – 3.59 NOTE 11 — OPERATING LEASES The Company has entered into a commercial operating lease with an independent third party for the use of an office in Hong Kong. The lease has an original term exceeding 1 year, but not more than 3 years with an option to renew a further term of 3 years. The operating leases are included in “Right-of-use asset, net” on the condensed consolidated balance sheets and represents the Company’s right to use the underlying assets during the lease term. The Company’s obligation to make lease payments are included in “Operating lease liabilities” on the condensed consolidated balance sheets. Supplemental balance sheet information related to the operating leases was as follows: As of March 31, 2026 December 31, 2025 Operating lease: Right-of-use assets $ 2,827 $ 2,827 Less: accumulated amortization ( 54 ) ( 54 ) Less: accumulated impairment losses ( 2,773 ) ( 2,773 ) Right-of-use assets, net $ — $ — Lease liabilities: Current lease liabilities $ 907 $ 960 Non-current lease liabilities 2,165 2,426 Total lease liabilities $ 3,072 $ 3,386 Operating lease expense for the three months ended March 31, 2026 and 2025 was approximately $ 0.2 million and $ 0.5 million, respectively. Other supplemental information about the Company’s operating lease as of March 31, 2026 and December 31, 2025 are as follow: As of March 31, 2026 December 31, 2025 Weighted average discount rate 5.25 % 5.25 % Weighted average remaining lease term (years) 3.14 3.39 Maturities of operating lease liabilities as of March 31, 2026 were as follows: For the year ended March 31, Operating lease 2027 $ 1,034 2028 905 2029 911 2030 482 Total minimum lease payments 3,332 Less: imputed interest ( 260 ) Total operating lease liabilities $ 3,072 29 NOTE 12 — STOCKHOLDERS’ DEFICIT (a) Common Stock The Company has 150,000,000,000 authorized shares of common stock, with a par value of $ 0.001 per share. During the three months ended March 31, 2026, the Company issued 200,000 shares of common stock to the employees of the Company under the 2024 Equity Incentive Plan (see Note 12(g)). There were 175,488,522 and 175,288,522 shares of common stock issued and outstanding, as of March 31, 2026 and December 31, 2025, respectively. For the three months ended March 31, 2026 and 2025, the Company recorded approximately $ 11.1 million and $ 28.8 million stock-based compensation expense, respectively which is included in the personnel and benefit expense and legal and professional fee in the unaudited condensed consolidated statements of operations and comprehensive loss. (b) Preferred Stock The Company has authorized a total of 100,000,000 shares of preferred stock with a par value of $ 0.001 per share. Of this amount the Company has authorized 50,000,000 shares and 50,000,000 shares to two classes of preferred stock, Series A-1 Preferred Stock and Series B Preferred Stock, respectively. A description of each class of preferred stock is listed below: Series A-1 Preferred Stock The Company designated up to 11,803,398 shares as Series A-1 Preferred Stock, with a par value of $ 0.001 per share. Each share of Series A-1 Preferred Stock shall be convertible, at the option of the holder thereof, at any time and from time to time, and without the payment of additional consideration by the holder thereof, into such number of fully paid and non-assessable shares of common stock. In connection with the Merger Transaction, the Company issued 11,801,804 shares of Series A-1 Preferred Stock to the holders of Triller Corp preferred stock and 11,801,804 shares of Series A-1 Preferred Stock to be issued to Giant Wisdom Ventures Limited. There were 11,801,804 and 11,801,804 shares of Series A-1 Preferred Stock issued and outstanding as of March 31, 2026 and December 31, 2025, respectively. Series B Preferred Stock The Company designated up to 35,000 shares of Series B Preferred Stock, with a par value of $ 0.001 per share. Each share of Series B Preferred Stock shall be entitled to 10,000 votes for each share of Series B Preferred Stock held by such holder. On January 1, 2026, pursuant to the bylaws of the Company, all outstanding Series B Preferred Stock were redeemed at par value. Following the redemption, there were no shares of Series B Preferred Stock outstanding and all rights of Series B Preferred Stockholders were terminated There were nil and 30,851 shares of Series B Preferred Stock issued and outstanding as of March 31, 2026 and December 31, 2025, respectively. (c) Common Stock To Be Issued The Company has committed to issue common stocks as compensation for services: (i) 9,682,500 common stocks to a consultant under a consulting agreement. In April 2025, 3,227,500 shares of common stock issued to 13080 as the first installment. (ii) 5,340,211 common stocks to directors, officers and employees under equity incentive plans for their service and performance. 30 There were 11,795,211 and 11,795,211 shares of common stock to be issued as of March 31, 2026 and December 31, 2025, respectively. (d) Common Stock Held In Escrow There were 24,206,246 shares of common stock deposited into an escrow account in the name of the Company, acting as escrow agent, in connection with the merger transaction completed on October 15, 2024. During the three months ended March 31, 2026 and 2025, nil and 2,043,962 shares common stock held in escrow, respectively are transferred out to settle claims that relate to the affairs of Triller Corp. prior to the closing date of the merger transaction with common stock held in escrow. There were 21,978,469 and 21,978,469 shares of common stock held in escrow issued and outstanding as of March 31, 2026 and December 31, 2025, respectively. (e) 2023 Share Award Scheme (the “Scheme”) Pursuant to the Share Award Scheme, the Company filed S-8 registration statement to register up to 5,652,352 shares of common stock on February 24, 2023. The fair value of the common stock granted during the period is measured based on the closing price of the Company’s common stocks as reported by Nasdaq Exchange on the date of grant. For those vested immediately on the date of grant, the fair value is recognized as stock-based compensation expense in the unaudited condensed consolidated statements of operations and comprehensive loss. As of March 31, 2026 and December 31, 2025, 11,579 and 11,579 shares of common stock are available to issue under the Share Award Scheme, respectively. (f) Restricted Share Units (“RSUs”) 2022 RSUs In December 2022, the Company approved and granted 2,420,625 shares of common stock as RSUs to employees and consultants as additional compensation under the Scheme. These RSUs typically will be vested over one to four years period from 2023 to 2026. For the RSUs, the fair value is recognized over the period based on the derived service period (usually the vesting period), on a straight-line basis. The valuations assume no dividends will be paid. The Company has assumed 10 % forfeitures. As of March 31, 2026 and December 31, 2025, 292,422 and 292,422 shares of common stock are available to issue under the plans, respectively. During the three months ended March 31, 2026 and 2025, the Company recorded approximately $ 0.05 million and $ 0.5 million stock-based compensation expense, respectively which is included in the personnel and benefit expenses in the unaudited condensed consolidated statements of operations and comprehensive loss. As of March 31, 2026, total unrecognized compensation remaining to be recognized in future periods for RSUs totaled approximately $0.2 million. They are expected to be recognized over the weighted average period ranging from 0.35 years. A summary of the activities for the Company’s 2022 RSUs as of March 31, 2026 and December 31, 2025 is as follows: As of March 31, 2026 December 31, 2025 Number of RSUs Weighted Average Grant Price Number of RSUs Weighted Average Grant Price Outstanding, beginning of year 292,422 $ 2.47 388,683 $ 2.47 Vested — $ — ( 96,261 ) $ 2.47 Outstanding, end of year 292,422 $ 2.47 292,422 $ 2.47 31 2025 RSUs In January 2025, the Company approved and granted 3,363,000 shares of common stock as RSUs to employees as additional compensation under the Scheme. These RSUs typically will be vested over two years period from 2025 to 2027. As of March 31, 2026 and December 31, 2025, 1,851,364 and 1,851,364 shares of common stock are available to issue under the plans, respectively. During the three months ended March 31, 2026 and 2025, the Company recorded approximately $ 0.7 million and $ 0.0 stock-based compensation expense, respectively which is included in the personnel and benefit expenses in the unaudited condensed consolidated statements of operations and comprehensive loss. As of March 31, 2026, total unrecognized compensation remaining to be recognized in future periods for RSUs totaled approximately $ 1.1 million. They are expected to be recognized over the weighted average period ranging from 0.58 years. A summary of the activities for the Company’s 2025 RSUs as of March 31, 2026 and December 31, 2025 is as follows: As of March 31, 2026 December 31, 2025 Number of RSUs Weighted Average Grant Price Number of RSUs Weighted Average Grant Price Outstanding, beginning of period/year 1,851,364 $ 1.03 — $ — Granted — $ — 3,363,000 $ 1.03 Vested — $ — ( 1,120,976 ) $ 1.03 Forfeited — $ — ( 390,660 ) $ 1.03 Outstanding, end of period/year 1,851,364 $ 1.03 1,851,364 $ 1.03 RSUs previously held by Triller Corp. (“Triller RSUs”) In connection with the Merger Transaction, the Company approved the conversion of all RSUs under Triller Corp. into 17,004,025 shares of common stocks of the Company as RSUs to certain employees, and the reservation of an aggregate of 17,004,025 shares of common stocks for future issuance upon the vesting of the RSUs. Triller RSUs typically will be vested over one to three years period from 2025 to 2027. The fair value is recognized over the period based on the derived service period (usually the vesting period), on a straight-line basis. The valuations assume no dividends will be paid. During the three months ended March 31, 2026 and 2025, the Company recorded approximately $ 8.5 million and $ 0.0 stock-based compensation expense, respectively which is included in the personnel and benefit expenses in the unaudited condensed consolidated statements of operations and comprehensive loss. As of March 31, 2026, total unrecognized compensation remaining to be recognized in future periods for RSUs totaled approximately $ 14.1 million. They are expected to be recognized over the weighted average period of 0.54 years. A summary of the activities for the Triller RSUs as of March 31, 2026 and December 31, 2025 is as follows: As of March 31, 2026 December 31, 2025 Number of RSUs Weighted Average Grant Price Number of RSUs Weighted Average Grant Price Outstanding, beginning of year 11,392,697 $ 5.60 17,004,025 $ 5.60 Granted — $ — 737,640 $ 0.70 Vested — $ — ( 6,348,968 ) $ 5.50 Outstanding, end of year 11,392,697 $ 5.60 11,392,697 $ 5.60 32 Share Incentive (the “Incentive Scheme”) During the three months ended March 31, 2026 and 2025, the Company recorded approximately $ 1.9 million and $ 0.0 stock-based compensation expense, respectively which is included in the personnel and benefit expenses in the unaudited condensed consolidated statements of operations and comprehensive loss. The fair value is recognized over the period based on the derived service period (usually the vesting period), on a straight-line basis. The valuations assume no dividends will be paid. As of March 31, 2026, total unrecognized compensation remaining to be recognized in future periods for Incentive Scheme totaled approximately $ 5.1 million. They are expected to be recognized over the weighted average period of 0.58 year. A summary of the activities for the Incentive Plan as of March 31, 2026 and December 31, 2025 is as follow: As of March 31, 2026 December 31, 2025 Number of RSUs Weighted Average Grant Price Number of RSUs Weighted Average Grant Price Outstanding, beginning of period 2,017,187 $ 3.68 4,437,812 $ 3.68 Vested ( 605,156 ) $ 3.68 ( 2,420,625 ) $ 3.68 Outstanding, end of period 1,412,031 $ 3.68 2,017,187 $ 3.68 (g) 2024 Equity Incentive Plan Pursuant to the 2024 Equity Incentive Plan (the “2024 Plan”), the Company filed S-8 registration statement to register 7,746,000 and 30,998,400 shares of common stock on August 29, 2024 and November 27, 2024, respectively. The fair value of the common stock granted during the period is measured based on the closing price of the Company’s common stock as reported by Nasdaq Exchange on the date of grant. For those vested immediately on the date of grant, the fair value is recognized as stock-based compensation expense in the unaudited condensed consolidated statements of operations and comprehensive loss. In March 2026, the Company issued an aggregate of 200,000 shares of common stock to the employees of the Company under the 2024 Equity Incentive Plan. As of March 31, 2026 and December 31, 2025, 1,865,121 and 2,065,121 shares of common stock are available to issue under this plan. NOTE 13 — INCOME TAX EXPENSE The provision for income tax expense consisted of the following: For the three months ended March 31, 2026 2025 U.S. $ — $ — Other than U.S. 52 24 Income tax expense $ 52 $ 24 For the three months ended March 31, 2026 2025 Current tax $ 52 $ 24 Deferred tax — — Income tax expense $ 52 $ 24 33 The Company’s subsidiaries mainly operate in Hong Kong and the U.S. that are subject to taxes in the jurisdictions in which they operate, as follows: United States of America The Company is formed in the State of Delaware, the Company is subject to the federal income tax rate of 21 %. British Virgin Islands The Company’s subsidiaries are incorporated in the British Virgin Islands and is not subject to taxation. In addition, upon payments of dividends by these entities to their stockholders, no British Virgin Islands withholding tax will be imposed. Hong Kong The Company’s subsidiaries operating in Hong Kong are subject to the Hong Kong Profits Tax at the income tax rates ranging from 8.25 % to 16.5 % on the assessable income arising in Hong Kong during its tax year. For the three months ended March 31, 2026 and 2025, the Company’s principal operations were conducted in Hong Kong. The reconciliation of the Hong Kong income tax rate of 16.5 % to the effective income tax rate based on loss before income tax expense are as follows: For the three months ended March 31, 2026 2025 Income tax expense at statutory rate ( 5,306 ) ( 8,749 ) Income not subject to taxes ( 43 ) ( 244 ) Non-deductible items: - Share based compensation 1,833 4,484 - Others (a) 468 2,389 Effect of difference tax jurisdiction ( 3 ) ( 2,267 ) Tax losses utilized — ( 144 ) Change in valuation allowance 3,124 4,576 Tax holiday ( 21 ) ( 21 ) Income tax expense $ 52 $ 24 Note: (a) For the three months ended March 31, 2026 and 2025, other non-deductible expenses mainly consisted of legal and professional fees and bad debts written-off, respectively. The following table sets forth the significant components of the deferred tax assets and liabilities of the Company as of March 31, 2026 and December 31, 2025: As of March 31, 2026 December 31, 2025 Deferred tax assets, net: Net operating loss carryforwards $ 23,348 $ 20,992 Less: valuation allowance ( 23,348 ) ( 20,992 ) Deferred tax assets, net: $ — $ — As of March 31, 2026, the operations incurred $ 124.7 million of cumulative net operating losses, which can be carried forward to offset future taxable income. Net operating loss can be carried forward indefinitely but cannot be carried back to prior years. There are no group relief provisions for losses or transfers of assets under Hong Kong tax regime. Each company within a corporate group is taxed as a separate entity. The Company has provided for a full valuation allowance against the deferred tax assets on the expected future tax benefits from the net operating loss carryforwards as the management believes that it is more likely that not all of these assets will be realized in the future. The valuation allowance is reviewed annually. 34 During the three months ended March 31, 2026 and 2025, the Company paid income tax expense of $ 0.1 million and $ 0.0 , respectively. Uncertain tax positions The Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of March 31, 2026 and December 31, 2025, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the three months ended March 31, 2026 and 2025 and did not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from March 31, 2026. NOTE 14 — RELATED PARTY BALANCES AND TRANSACTIONS The table below sets forth major related parties of the Company and their relationships with the Company. Name Relationship with the Company Mr. Tsai Ming Hsing, Richard (“Mr. Tsai”) Controlling stockholder of the Company Mr. Ng Wing Fai (“Mr. Ng”) Chief Executive Officer and Executive Director of the Company Ms. Wong Suet Fai Almond Chief Operating Officer of the Company JFA Capital Investment private funds controlled by Mr. Tsai NSD Capital Investment private funds controlled by Mr. Tsai TAG Holdings Limited Stockholder and immediate holding company of the Company TAG Financial Holdings Limited Company controlled by Mr. Tsai Convoy Financial Services Limited Company controlled by Mr. Tsai Convoy Global Holdings Limited Company controlled by Mr. Tsai Giant Wisdom Ventures Limited Company controlled by Mr. Tsai Green Nature Limited Company controlled by Mr. Tsai Total Formation Inc. Stockholder of the Company and company controlled by Mr. Tsai Capital Truth Holdings Ltd. Stockholder of the Company Atlas Merchant Capital LLC Company controlled by the former chairman of the Company DeSilva 2000 Living Trust Company controlled by director of subsidiaries of the Company HCMPS Healthcare Holdings Limited Company with common director – Mr. Ng In support of the Company’s efforts and cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support by the stockholder. Amounts represent advances or amounts paid in satisfaction of liabilities. (i) Related party balances Related party balances consisted of the following: As of March 31, 2026 December 31, 2025 Balance with related parties: Loan interest payable (a) $ 7,070 $ 5,778 Borrowings (b) $ 51,265 $ 48,959 Long-term investment – Investment E (c) $ 520 $ 524 Convertible debt (d) $ 59,722 $ 59,722 (a) Loan interest payable due to related parties represented the interest payable accrued on the short-term borrowings from four related parties. (b) Borrowings consisted of short-term loans obtained from the Company’s senior management, major stockholder of ultimate holding company, a company controlled by director of subsidiaries and a stockholder. The amounts were secured, interest-bearing and repayable on demand (see Note 8(b)). (c) The Company purchased 4 % equity interest in Investment E from a related party in May 2021, based on historical cost. The Company has a common director with Investment E. (d) TFI Note obtained from the Company’s major stockholder of ultimate holding company. The amount was secured, interest-bearing, and repayable on demand. The Company issued an exchangeable note of approximately $ 5.4 million to Giant Wisdom Ventures Limited which bears interest at a fixed rate of 15 % per annum and mature on January 16, 2025. The note is secured by a pledge of 5,000,000 shares of common stock of BKFC owned by the Company (see Note 9). 35 (ii) Transaction with related parties In the ordinary course of business, during the three months ended March 31, 2026 and 2025, the Company involved with transactions, either at cost or current market prices and on the normal commercial terms among related parties. The following table provides the transactions with these parties for the periods as presented (for the portion of such period that they were considered related): For the three months ended March 31, 2026 2025 Office rental and operating fees (e) $ 663 $ 1,178 Interest expense (f) $ 1,293 $ 635 (e) Pursuant to the service agreement, the Company agreed to pay the office and administrative expenses to the holding company for the use of office premises, including, among other things, building management fees, government rates and rent, office rent, and lease-related interest and depreciation that were actually incurred by the holding company. (f) The interest expense incurred for borrowings from four related parties (see Note 8(b)). Apart from the transactions and balances detailed above and elsewhere in these accompanying unaudited condensed consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented. NOTE 15 — RISK AND UNCERTAINTIES The Company is exposed to the following concentrations of risks: (a) Major customers For the three months ended March 31, 2026, the customers who accounted for 10% or more of the Company’s revenues and its outstanding receivable balances at the reporting dates, are presented as follows: For the three months ended March 31, 2026 As of March 31, 2026 Customer Revenues Percentage of revenues Accounts receivable Customer A $ 1,044 21 % $ 253 Customer B $ 640 13 % $ 57 Customer C $ 621 12 % $ 94 Customer D $ 550 11 % $ 45 For the three months ended March 31, 2025, there was no customer who accounted for 10% or more of the Company’s revenue and its outstanding receivable balances. (b) Credit risk Financial instruments that potentially subject the Company to credit risk consist of cash equivalents, restricted cash, accounts receivable, loans receivable, and notes receivables. Cash equivalents are maintained with high credit quality institutions, the composition and maturities of which are regularly monitored by management. As of March 31, 2026, the Company maintained a total of approximately $ 12.1 million at financial institutions, consisting of approximately $ 11.7 million held in Hong Kong, including a cash balance of approximately $ 1.8 million and escrow funds of approximately $ 9.9 million, of which approximately $ 11.1 million was subject to credit risk, and approximately $ 0.4 million in cash held in the United States. These balances are protected by the Hong Kong Deposit Protection Board, which provides coverage up to a limit of HK$ 0.8 million (approximately $ 0.1 million) if the bank with which an individual/a company hold its eligible deposit fails, effective from October 1, 2024, and the Federal Deposit Insurance Corporation (“FDIC”) in the United States. While management considers these financial institutions to be of high credit quality, it continuously monitors their creditworthiness. For accounts receivable, the Company determines, on a continuing basis, the probable losses and sets up an allowance for expected credit losses based on the estimated realizable value. Credit of money lending business is controlled by the application of credit approvals, limits and monitoring procedures. 36 The Company uses internally-assigned risk grades to estimate the capability of borrowers to repay the contractual obligations of their loan agreements as scheduled or at all. The Company’s internal risk grade system is based on experiences with similarly graded loans and the assessment of borrower credit quality, such as, credit risk scores, collateral and collection history. Individual credit scores are assessed by credit bureau, such as TransUnion. Internal risk grade ratings reflect the credit quality of the borrower, as well as the value of collateral held as security. To minimize credit risk, the Company requires collateral arrangements to all mortgage loans and has policies and procedures for validating the reasonableness of the collateral valuations on a regular basis. Management believes that these policies effectively manage the credit risk from advances. (c) Economic and political risk The Company’s major operations are conducted in Hong Kong and the United States of America. Accordingly, the political, economic, and legal environments in Hong Kong and the United States of America, as well as the general state of their economies may influence the Company’s business, financial condition, and results of operations. In February 2022, the Russian Federation and Belarus commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States, have instituted economic sanctions against the Russian Federation and Belarus. Further, the impact of this action, war at the Middle East, and related sanctions on the world economy are not determinable as of the date of these unaudited condensed consolidated financial statements. The specific impact on the Company’s financial condition, results of operations, and cash flows is also not determinable as of the date of these unaudited condensed consolidated financial statements. (d) Exchange rate risk The Company cannot guarantee that the current exchange rate will remain steady; therefore there is a possibility that the Company could post the same amount of profit for two comparable periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of HKD converted to US$ and Sterling on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice. For the three months ended March 31, 2026 and 2025, the Company recorded the foreign exchange loss of approximately $ 0.2 million and gain of $1.1 million, respectively, mainly attributable from the long-term investments which are mostly denominated in Sterling. (e) Liquidity risk Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company’s policy is to ensure that it has sufficient cash to meet its liabilities when they become due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation. A key risk in managing liquidity is the degree of uncertainty in the cash flow projections. If future cash flows are fairly uncertain, the liquidity risk increases. NOTE 16 — COMMITMENTS AND CONTINGENCIES Regulatory Non-Compliance On April 17, 2025, the Company received a written notice (the “Notice”) from Nasdaq Stock Market, LLC (“Nasdaq”), notifying that the Company failed to comply with Nasdaq Listing Rule 5250(c)(1) as the Company failed to timely file its Annual Report on Form 10-K for the year ended December 31, 2024. The Notice had no immediate effect but, before June 16, 2025, the Company was required to submit a plan to Nasdaq to regain compliance with the Nasdaq Listing Rule. If Nasdaq accepts the Company’s plan, Nasdaq will grant the Company up to 180 calendar days from the filing due date to regain compliance. Otherwise, after the date, subject to other requirements and conditions, the Company may proceed to delisting procedures. On August 19, 2025, Nasdaq accepted the Company’s plan to regain the compliance by October 13, 2025. On May 20, 2025, the Company received a written notice (the “Notice”) from Nasdaq, notifying that the Company failed to comply with Nasdaq Listing Rule 5250(c)(1) as the Company failed to timely file its quarterly report on Form 10-Q for the period ended June 30, 2025. The Notice had no immediate effect but, before June 16, 2025, the Company was required to submit a plan to Nasdaq to regain compliance with the Nasdaq Listing Rule. If Nasdaq accepts the Company’s plan, Nasdaq will grant the Company up to 180 calendar days from the filing due date to regain compliance. Otherwise, after the date, subject to other requirements and conditions, the Company may proceed to delisting procedures. On August 19, 2025, Nasdaq accepted the Company’s plan to regain the compliance by October 13, 2025. 37 On June 30, 2025, the Company received a written notice (the “Notice”) from Nasdaq, notifying that the Company had publicly traded under $ 1.00 per share for a period of 30 consecutive trading days or more, which failed to comply with Nasdaq Listing Rule 5550(a)(2) and Nasdaq Listing Rule 5810(c)(3)(A). The Notice had no immediate effect but, before December 29, 2025, the Company was required to regain compliance by trading at least $ 1.00 per share for a minimum of 10 consecutive trading days. Otherwise, after the date, subject to other requirements and conditions, the Company may proceed to delisting procedures. As of the date of the unaudited condensed consolidated financial statements, the Company is still consecutively trading under $ 1.00 , directors of the Company are investigating actions, where appropriate, to regain the compliance, by December 29, 2025. On October 14, 2025, the Company received a delisting determination letter (the “Determination Letter”) from Nasdaq indicating that, unless the Company timely requests a hearing before the Nasdaq Hearings Panel (the “Panel”), the Company’s common stock would be subject to suspension and delisting from the Nasdaq Capital Market at the opening of business on October 23, 2025 due to the Company’s non-compliance with Nasdaq’s filing requirements set forth in Listing Rule 5250(c)(1) (the “Listing Rule”) for its failure to timely file its Form 10-K for the year ended December 31, 2024, and its Forms 10-Q for the periods ended March 31, 2025 and June 30, 2025, respectively. The Company has requested to appeal the delisting determination and will attend the hearing to demonstrate its ability to regain and sustain long-term compliance. On November 17, 2025, the Company received an additional delisting determination letter (the “Additional Determination Letter”) from Nasdaq indicating that since it failed to timely file its Form 10-Q for the period ended September 30, 2025, this serves as an additional basis for delisting. Following a hearing held on November 25, 2025, the Panel has granted the Company an exception period subject to the Company satisfying the following conditions: ● File 2024 Form 10-K and delinquent Forms 10-Q for the quarters ended June 30, June 30, and September 30, 2025 on or before December 24, 2025; ● Regain compliance with the $ 1.00 minimum bid-price requirement on or before February 27, 2026; and ● File its 2025 Form 10-K on or before June 30, 2026. On December 26, 2025, the Company received a determination letter from the Panel confirming the suspension trading on the Nasdaq Stock Market effective at the opening of the market on December 30, 2025 and delisting of the Company’s securities. This decision stems from the Company not having been able to file two periodic reports by a deadline of December 24, 2025 set by the Panel. On January 26, 2026, the Company filed its Annual Report on Form 10-K for the year ended December 31, 2024 and Form 10-Q for the period ended March 31, 2025. On January 27, 2026, the Company filed its Form 10-Q for the period ended June 30, 2025 and September 30, 2025. On April 14, 2026, the Company filed its Annual Report on Form 10-K for the year ended December 31, 2025. On March 24, 2026, pursuant to an appeal by the Company, the Nasdaq Stock Market Listing and Hearing Review Council (the “Listing Council”) issued a decision (the “Listing Council Decision”) to modify a previous December 26, 2025 decision by the Panel to delist the securities of the Company and suspend trading of the Company’s shares, effective at the opening of trading on December 30, 2025, for non-compliance with Nasdaq Listing Rule 5250(c)(1) (the “Periodic Filing Rule”). Pursuant to the December 26, 2025, the Panel decision, trading of the Company’s securities on the Nasdaq was suspended from December 30, 2025 to April 15, 2026, the day after the Company satisfied the conditions of the Listing Council Decision to resume trading by demonstrating its current compliance with the Periodic Filing Rule by filing with the Securities and Exchange Commission the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. On April 17, 2026, the Company received a delisting determination letter (the “Determination Letter”) from the Listing Qualifications Staff (the “Staff”) of the Nasdaq based on the Company’s non-compliance with Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”) as of December 29, 2025. The Delisting Letter does not result in the immediate delisting of the Company’s common stock from Nasdaq or state a date on which Staff intends a delisting or suspension to occur. 38 Under Nasdaq Listing Rule 5810(d), Staff issued the Determination Letter as an additional deficiency notification and notified the Listing Council. Staff issued the Determination Letter while Staff’s April 6, 2026 request “seeking guidance” from the Listing Council relating to bid price compliance was pending before the Listing Council and prior to the resumption of trading of the Company’s securities on April 17, 2026. On April 20, 2026, the Company filed with the Listing Council the Company’s response to Staff’s request “seeking guidance.” On April 21, 2026, the Listing Council, after reviewing the Staff’s and the Company’s submissions, notified Staff and the Company that: ● The Council believed that it is up to the Hearings Panel to adjudicate the Company’s Bid Price Rule noncompliance. Therefore, the Council remanded this matter to the Hearings Panel. ● Considering the Council’s remand, Staff’s instruction to the Company to respond to Staff’s April 17 submission by making a submission by April 24 addressed to the Listing Council, should instead be construed as directing the Company to make a submission addressed to the Hearings Panel. ● The Listing Council understands from Staff’s April 17 submission that it is the view of Staff that the Company “is ineligible for any further compliance or cure period” to come into compliance with the Bid Price Rule. Due to the unusual procedural history of this matter, if the Panel agrees with Staff’s view and issues a delisting decision without affording the Company more time to come into compliance with the Bid Price Rule, then the Listing Council will call the matter for review and stay such Hearings Panel delisting decision. The Company submitted its response to the Panel on April 24, 2026. The Company requested for a new exception period, pursuant to Nasdaq Listing Rule 5815(c)(1)(A), to regain compliance with the Minimum Bid Price Requirement. The Company also informed the Panel of its plan to demonstrate its ability to regain compliance with the Minimum Bid Price Requirement. There can be no assurance that the Company will be able to regain compliance with the Minimum Bid Price Requirement. Contractual Commitments Sale and Purchase Agreement with Sony Life Singapore Pursuant to the agreement dated April 5, 2023, entered with Sony Life Singapore Pte. Ltd. (“SLS”), an independent third party, the Company is committed to purchase 100 % equity interest in Sony Life Financial Advisers Pte. Ltd. for a cash consideration of SGD 2.5 million (equivalent to approximately $ 1.88 million). On December 28, 2023, the Company and SLS entered into a second supplementary agreement to extend the closing date of the transaction from December 31, 2023 to September 30, 2024. On March 29, 2024, the Company and SLS entered into a third supplementary agreement to extend the closing date of the transaction from September 30, 2024 to May 9, 2024. Pursuant to the third supplementary agreement, the Company paid SGD 0.25 million (equivalent to approximately $ 0.19 million) to SLS as the partial payment to cash consideration on April 12, 2024. On May 9, 2024, the Company and SLS entered into a fourth supplementary agreement to extend the closing date of the transaction from May 9, 2024 to May 20, 2024. On June 18, 2024, the Company and SLS entered into a fifth supplementary agreement to extend the closing date of the transaction from May 20, 2024 to July 31, 2024. Pursuant to the fifth supplementary agreement, the Company paid an aggregate of SGD 0.15 million (equivalent to approximately $ 0.11 million) as the extension fee and indemnification fee in July 2024. On October 3, 2024 and January 30, 2025, the Company and SLS entered into the sixth and seventh supplementary agreements, respectively to extend the closing date of the transaction to February 28, 2025. Subsequently on March 14, 2025, SLS issued a termination notice to terminate the agreement due to the Company’s failure to complete the transaction. On April 21, 2025, the Company and SLS entered into a settlement agreement under which the Company is obligated to pay SLS a settlement amount of SGD 1,850,000 (equivalent to $ 1.4 million) on or before August 31, 2025. In addition, SLS has claimed further damages of SGD 100,000 (equivalent to $ 0.07 million) arising from the Company’s breach of its obligations under the agreement. Both the settlement amount and the additional damages claim bear interest at a rate of 5.33 % per annum, accruing from March 5, 2025, until the date of full payment. Legal Matters and Other Contingencies From time to time, the Company is party to various claims and legal proceedings incident to the operation of its business. For example, the Company is currently involved in proceedings brought by music companies relating to the payment of royalties for music used on its platform, employment and related matters, consumer class actions and suits alleging, among other things, violations of state consumer protection or privacy laws, and contractual disputes over representations and warranties and post-closing obligations associated with business acquisitions. In addition, third parties have from time to time claimed, and others may claim in the future, that the Company has infringed their intellectual property rights. The Company is subject to intellectual property disputes, including patent infringement claims, and management expects that it will continue to be subject to intellectual property infringement claims as its services expand in scope and complexity. The Company is not presently involved in any patent infringement and other intellectual property-related lawsuits. The Company may also become more vulnerable to third-party claims as laws such as the Digital Millennium Copyright Act are interpreted by the courts, and the Company becomes subject to laws in jurisdictions where the underlying laws with respect to the potential liability of online intermediaries are either unclear or less favorable. Management believes that additional lawsuits alleging that the Company has violated patent, copyright or trademark laws may be filed against it. Intellectual property claims, whether meritorious or not, are time consuming and often costly to resolve, could require expensive changes in the Company’s methods of doing business or the goods it sells, or could require the Company to enter into costly royalty or licensing agreements. 39 The Company is also subject to consumer claims or lawsuits relating to alleged violations of consumer protection or privacy rights and statutes, some of which could involve potentially substantial claims for damages, including statutory or punitive damages. Consumer and privacy-related claims or lawsuits, whether meritorious or not, could be time consuming, result in costly litigation, damage awards, fines and penalties, injunctive relief or increased costs of doing business through adverse judgment or settlement, or require the Company to change its business practices, sometimes in expensive ways. The Company is also subject to, or in the future may become subject to, a variety of regulatory inquiries, audits, and investigations across the jurisdictions where it conducts business, including, for example, inquiries related to consumer protection, employment matters and/or hiring practices, marketing practices, tax, unclaimed property and privacy rules and regulations. Any regulatory actions against the Company, whether meritorious or not, could be time consuming, result in costly litigation, damage awards, fines and penalties, injunctive relief or increased costs of doing business through adverse judgment or settlement, require the Company to change its business practices in expensive ways, require significant amounts of management time, result in the diversion of significant operational resources, materially damage its brand or reputation, or otherwise harm its business. Legal expenses related to defense, negotiations, settlements, rulings and advice of outside legal counsel are expensed as incurred. The Company establishes an accrued liability for loss contingencies related to legal and regulatory matters when the loss is both probable and reasonably estimable. Those accruals represent management’s best estimate of probable losses and, in such cases, there may be an exposure to loss in excess of the amounts accrued. For certain of the matters described above, there are inherent and significant uncertainties based on, among other factors, the stage of the proceedings, developments in the applicable facts of law, or the lack of a specific damage claim. The Company’s accrued liabilities for loss contingencies related to legal and regulatory matters may change in the future as a result of new developments, including, but not limited to, the occurrence of new legal matters, changes in the law or regulatory environment, adverse or favorable rulings, newly discovered facts relevant to the matter, or changes in the strategy for the matter. Regardless of the outcome, litigation and other regulatory matters can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. The following describes material legal proceedings in which the Company is involved as of March 31, 2026: (i) Action Case: CACV 1116/2025 (on appeal from HCA702/2018) On March 27, 2018, the writ of summons was issued against the Company and seven related companies of the former shareholder (the “Defendants”) by the Plaintiff. This action alleged the infringement of certain registered trademarks currently registered under the Plaintiff. On February 23, 2023, the Court granted leave for this action be set down for trial of 13 days, and the trial will commence on November 25, 2024. On October 31, 2025, the Court granted judgement in favor of the Plaintiff. On November 28, 2025, the Defendants lodged and served the Notice of Appeal (CACV 1116/2025) to the Court of Appeal. Legal counsel of the Company will continue to handle in this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome of the appeal or the range of reasonably possible loss as the Court is in the process of quantifying the amount of damages. (ii) Action Case: HCA765/2019 On April 30, 2019, the writ of summons was issued against the Company’s subsidiary, three related companies and the former directors, stockholders and financial consultant by the Plaintiff. This action alleged the deceit and misrepresentation from an inducement of the fund subscription and claimed for compensatory damage of approximately $ 2.6 million. On April 18, 2024, the court made an order that the plaintiff shall set the case down for trial on or before July 6, 2024 for a 7 days trial before a judge and there shall be a pre-trial review before the trial judge on a date 12 weeks before the trial. The plaintiff and the defendants agreed on a time extension until August 8, 2024 to set the case down for trial. On August 9, 2024, the Court made an order that the case be adjourned to January 14, 2025 for another case management conference. On February 17, 2025, the Company filed an amended defence to the court and the next case management conference is fixed to be heard on January 6, 2026. The case is on-going and parties have yet to attempt mediation. Legal counsel of the Company will continue to handle this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome of the matter or the range of reasonably possible loss, if any. (iii) Action Case: HCA2097 and 2098/2020 On December 15, 2020, the writs of summons were issued against the Company and the former consultant by the Plaintiff. This action alleged the misrepresentation and conspiracy causing the loss from the investment in corporate bond and claimed for compensatory damage of approximately $ 1.7 million. The Company previously made approximately $ 0.8 million as contingency loss for the year ended December 31, 2021. Parties participated in a mediation held on March 25, 2022 and negotiated for settlement through without prejudice correspondence, no settlement was reached. The pre-trial review is fixed to be heard on January 29, 2026 and the 6-days trial is fixed to be heard from May 14 to 21, 2026. The case is on-going and legal counsel of the Company will continue to handle this matter. As of March 31, 2026, the Company accrued a legal provision of approximately $ 0.8 million as a liability in the unaudited condensed consolidated balance sheets. 40 (iv) Sony Music Entertainment In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, including the legal contingency accrual stemming from the litigation with Sony Music Entertainment (“Sony”) alleging claims for breach of contract, copyright infringement, contributory copyright infringement, and vicarious copyright infringement. The court entered judgement pursuant to stipulation in the amount of approximately $ 3.6 million requiring Triller Corp to make monthly payments through May 21, 2025. Triller Corp defaulted on the payments and judgement was entered against Triller Corp on August 27, 2024 for the full amount due. As of March 31, 2026, approximately $ 3.6 million is included as a liability in the unaudited condensed consolidated balance sheets. (v) Sony Music Publishing Europe Limited (“SOLAR”) In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, including the legal contingency accrual stemming from the complaint filed by SOLAR in the London, United Kingdom Circuit Common Court alleging claims of songwriter/producer music publishing rights infringement. A default judgement for $ 5.4 million was ruled in SOLAR’s favor and SOLAR filed an action in the Superior Court of California for the County of Los Angeles for recognition of this foreign country money judgment in the amount of approximately $ 5.4 million. As of March 31, 2026, this amount is included as a liability in the unaudited condensed consolidated balance sheets. (vi) Music Licensing Triller Corp has outstanding contractual obligations to various record labels, music publishers and performing rights organizations (collectively, “Rightsholders”) who have licensed to Triller Corp the right to use sound recordings and musical compositions in connection with the operation of the Triller app and other aspects of the Company’s business. As of March 31, 2026, the Company has recorded liabilities in the amount of approximately $ 30.0 million for unpaid amounts owed under its music licenses. Triller Corp is also involved in various legal proceedings and has received threats of litigation from Rightsholders. Triller Corp believes it may be or become liable to Rightsholders for additional amounts such as interest, penalty fees, attorneys’ fees, copyright infringement damages and other amounts, but is currently unable to estimate the probability of loss associated with these actions or the range or reasonably possible losses, if any, or the impact such losses may have on the Company’s results of operations, financial condition or cash flows. (vii) Fox Plaza Lease In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, including the legal contingency accrual stemming from the ongoing litigation with Fox Plaza, LLC due to an alleged breach of a commercial office lease agreement as a result of an alleged failure to pay rents under the agreement. The plaintiff seeks damages in excess of approximately $ 3.5 million, plus attorney’s fees, costs of suit, and additional damages to be proven at trial. Triller Corp intends to vigorously defend itself in this matter. The Company has accrued approximately $ 1.8 million as a liability pertaining to this claim on the unaudited condensed consolidated balance sheets. It is reasonably possible that the potential loss may exceed the accrued liability amount. (viii) Concentrix Daksh In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, including the legal contingency accrual stemming from the arbitration with Concentrix Daksh Services India Private Ltd. (“Concentrix”). Concentrix alleges wrongful early termination of a services agreement and seeks damages of approximately $ 2.0 million in lost profits, plus interest and fees. The Company has accrued approximately $ 2.0 million as a liability pertaining to this matter. While the Company intends to defend the claim vigorously, management believes the recorded amount represents the probable loss as of March 31, 2026. (ix) Epic Sports & Entertainment In connection with the Merger Transaction, the Company assumed the liabilities of Triller Hold Co LLC and Triller Fight Club LLC related to litigation with Epic Sports & Entertainment, Inc. (“Epic”) for alleged breach of a settlement agreement. Epic initially claimed damages of approximately $ 1.8 million, and recent settlement discussions indicate a potential settlement range of approximately $ 0.6 to $ 2.0 million. As of March 31, 2026, the Company accrued a legal provision of approximately $ 1.9 million as a liability in the unaudited condensed consolidated balance sheets. (x) Samsung Arbitration Award In connection with the Merger Transaction, the Company assumed the liabilities of Triller Corp, including the legal contingency accrual stemming from the arbitration with Samsung Electronics Co., Ltd due to a breach of a commercial agreement and failure to pay the amounts owed under the contract. The U.S. District Court for the Central District of California confirmed the award and entered a judgment of approximately $ 2.6 million in May 2024, accruing interest at $ 368.43 per day, at a rate of 5.17 % per annum until repaid. A writ of execution was issued on August 2, 2024, and a Judgment Debtor Examination is scheduled for February 24, 2025. The Company provided financial records in December 2024 in response to a subpoena. As of March 31, 2026, the Company accrued approximately $ 3.0 million as a liability in the unaudited condensed consolidated balance sheets. 41 (xi) Prem Parameswaren In connection with the Merger Transaction, the Company assumed potential liabilities related to claims asserted by Prem Parameswaran, the former Chief Executive Officer of Triller Corp for alleged unpaid compensation. To avoid litigation, the parties reached an agreement in principle for a settlement consisting of $ 500,000 in cash, and 625,000 stock units which was issued and settled during the year ended December 31, 2025. As of March 31, 2026, the Company has accrued approximately $ 0.5 million as a liability in the unaudited condensed consolidated balance sheets. (xii) Triller Legacy, LLC Settlement Agreement On July 26, 2024, Triller Hold Co, LLC and Triller Acquisition, LLC entered into a settlement agreement with Triller Legacy, LLC (“Legacy”), original sellers of Triller Corp, regarding the 2019 acquisition of Triller Corp from Legacy. The Company agreed to issue 3.89 million shares of Series A common stock to Legacy. Legacy intends to sell 1.75 million shares for a minimum return of approximately $ 7.0 million by the end of December 31, 2025. The Company must compensate Legacy for any shortfall of share sales below $ 7.0 million. The Company has the option to purchase up to 1.75 million shares from Legacy at $ 4.00 per share through December 31, 2024 and $ 4.75 per share through December 31, 2025. The Company can also opt to pay Legacy $ 7.0 million. The Company has included the estimated guaranteed payment liability in its accounts payable and legal contingencies. As of March 31, 2026, the Company has accrued approximately $ 7.0 million as a liability in the unaudited condensed consolidated balance sheets. (xiii) Bobby Sarnevesht The Company is subject to claims asserted by Bobby Sarnevesht for alleged breach of a merger agreement and related contracts. The Company disputes the claims and the matter remains unresolved. As of March 31, 2026, the Company has accrued approximately $ 8.7 million as a liability pertaining to this dispute, which represents management’s best estimate of the probable loss. (xiv) YA II PN, LTD. v. Triller Group Inc.; Triller Corp.; Triller Hold Co LLC; Convoy Global Holdings Limited, Index No. 659314/2024 in the New York Supreme Court, Commercial Division On November 26, 2024, Yorkville (“Plaintiff”) initiated litigation against the Company, Triller Corp., Triller Hold Co LLC, and Convoy Global Holdings Limited (“Defendants”) by filing a motion for summary judgment in lieu of a complaint pursuant to NY CPLR 3213 (the “Motion”), seeking a judgment finding Defendants liable for all amounts allegedly owed under the convertible promissory note (the “Note”), dated June 28, 2024, including interest, plus costs, legal fees, and expenses incurred by Yorkville in enforcing the Note’s terms. On February 24, 2025, Defendants filed their opposition to the Motion, arguing that the Motion should be denied because Plaintiff’s reliance on CPLR 3213 was improper and because, even if Plaintiff’s reliance on CPLR 3213 were proper, triable disputes of fact preclude summary judgment in Plaintiff’s favor. On March 7, 2025, Plaintiff filed a reply in support of the Motion. On May 19, 2025, Yorkville’s initial motion for summary judgment in lieu of complaint, seeking immediate payment, was denied by the Supreme Court of the State of New York, New York County. The court determined that Yorkville’s right to payment depended on a detailed analysis of obligations under multiple intertwined documents, including the Yorkville Convertible Promissory Note, Second A&R SEPA, Registration Rights Agreement, and Pledge Agreements, thus converting the case to a plenary action. Yorkville filed a notice of appeal on May 28, 2025 and a new motion for summary judgment on July 1, 2025, asserting the Yorkville Convertible Promissory Note’s maturity date of June 28, 2025 (the “Maturity Date”). On June 20, 2025, the Company transferred 3,000,000 shares of common stock of BKFC, previously pledged by Triller Hold Co LLC as collateral pursuant to the Amended and Restated Pledge Agreement, dated June 28, 2024, between Triller Hold Co LLC and Yorkville, as partial repayment. The case does not have a trial date set. Defendants intend to litigate the case until a resolution is reached. On December 3, 2025, the Plaintiff filed responses and objections (the “Responses and Objections”) to the Defendants’ first set of interrogatories dated November 3, 2025 to the Supreme Court of the State of New York County of New York (Index no.: 659314/2024). Pursuant to the Responses and Objections, the Plaintiff stated its claims and contentions with respect to its damage resulting from the event of default that occurred under the Note when the Defendants failed to pay all amounts due by the Maturity Date. The total amount owed under the Note, including interest, plus costs, legal fees, and expenses incurred by Yorkville less the value of BKFC’s shares is approximately $ 38.1 million. Yorkville further stated that it continues to accrue additional damages with each passing day that the obligations under the Note and guaranties remain unpaid. The case is on-going and legal counsel of the Company will continue to handle this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome of the matter or the range of reasonable possible loss, if any. (xv) 13080 Advisors LLC v. Triller Group, Inc., Jams Reference No. 5220008039 (Los Angeles County, California) On December 18, 2024, 13080 Advisors LLC (“Claimant”) submitted a Notice of Arbitration and Demand for Arbitration (“13080 Arbitration Demand”) to JAMS to assert that Triller and TAG Holdings Limited (collectively as “Respondents”) have breached their alleged duties to Claimant under the following alleged agreements: (1) a partially executed document entitled “Grant Agreement for S-8 Registered Shares” dated March 14, 2024, and (2) a partially executed document entitled “Consulting Services Agreement” also dated March 14, 2024. The 13080 Arbitration Demand asserts four purported claims for relief: breach of contract, negligent misrepresentation, specific performance and declaratory relief. On February 18, 2025, Respondents submitted to JAMS a motion to dismiss all the claims for relief asserted in the 13080 Arbitration Demand along with a motion to strike Claimant’s requests for punitive damages. This motion remains pending and no arbitrator has been appointed. The case is on-going and legal counsel of the Company will continue to handle this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome of the matter or the range of reasonable possible loss, if any. 42 (xvi) Robert E. Diamond Jr.et al. v. Triller Group, Inc., Case No. 25-cv-00129 (PAE) (S.D.N.Y.) On January 7, 2025, Robert E. Diamond Jr (“Diamond”), the former chairman of Triller’s board of directors and Atlas Merchant Capital LLC (collectively as “Plaintiffs”), an advisory services company under Diamond’s control filed a lawsuit in federal district court in Manhattan, New York to allege that Triller has failed to pay over or grant to Plaintiffs certain cash amounts and equity awards to which Plaintiffs were entitled pursuant to various agreements between Plaintiffs and Triller. Plaintiffs claim that they are entitled to over $ 5.0 million in cash compensation and over 6.0 million shares of Triller’s common stock. On February 28, 2025, Triller filed a partial motion to dismiss the scope of Plaintiffs’ claims. This motion is now pending before the court. The case is on-going and legal counsel of the Company will continue to handle this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome of the matter or the range of reasonable possible loss, if any. (xvii) Action Case: HCA 301/2025 On February 16, 2026, a writ of summons was served on the Company by the plaintiff, Singway (B.V.I.) Company Limited, in connection with an alleged breach of a tenancy agreement relating to commercial premises located on the 3 rd floor of Hopewell Centre in Hong Kong. The claim includes, among other things, recovery of vacant possession, arrears of rental payments, other outstanding charges, interest and damages in an aggregated amount of approximately $ 42.9 million. The Company is going to file and serve its defence and counterclaim on or before April 29, 2026. Legal counsel of the Company will continue to handle this matter. As of March 31, 2026, the Company has accrued approximately $ 42.9 million as a liability pertaining to this dispute, which represents management’s best estimate of the probable loss. NOTE 17 — SUBSEQUENT EVENTS In accordance with ASC Topic 855, “ Subsequent Events ”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before the unaudited condensed consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after March 31, 2026, up to the date that the unaudited condensed consolidated financial statements were available to be issued. In April 2026, the Company issued aggregate 1,377,382 shares of common stock to a director, officers and employees of the Company under the 2024 Equity Incentive Plan. On April 17, 2026, the Company received a delisting determination letter (the “Determination Letter”) from the Listing Qualifications Staff (the “Staff”) of the Nasdaq based on the Company’s non-compliance with Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”) as of December 29, 2025. The Delisting Letter does not result in the immediate delisting of the Company’s common stock from Nasdaq or state a date on which Staff intends a delisting or suspension to occur. Under Nasdaq Listing Rule 5810(d), Staff issued the Determination Letter as an additional deficiency notification and notified the Listing Council. Staff issued the Determination Letter while Staff’s April 6, 2026 request “seeking guidance” from the Listing Council relating to bid price compliance was pending before the Listing Council and prior to the resumption of trading of the Company’s securities on April 17, 2026. On April 20, 2026, the Company filed with the Listing Council the Company’s response to Staff’s request “seeking guidance.” On April 21, 2026, the Listing Council, after reviewing the Staff’s and the Company’s submissions, notified Staff and the Company that: ● The Council believed that it is up to the Hearings Panel to adjudicate the Company’s Bid Price Rule noncompliance. Therefore, the Council remanded this matter to the Hearings Panel. ● Considering the Council’s remand, Staff’s instruction to the Company to respond to Staff’s April 17 submission by making a submission by April 24 addressed to the Listing Council, should instead be construed as directing the Company to make a submission addressed to the Hearings Panel. ● The Listing Council understands from Staff’s April 17 submission that it is the view of Staff that the Company “is ineligible for any further compliance or cure period” to come into compliance with the Bid Price Rule. Due to the unusual procedural history of this matter, if the Panel agrees with Staff’s view and issues a delisting decision without affording the Company more time to come into compliance with the Bid Price Rule, then the Listing Council will call the matter for review and stay such Hearings Panel delisting decision. The Company submitted its response to the Panel on April 24, 2026. The Company requested for a new exception period, pursuant to Nasdaq Listing Rule 5815(c)(1)(A), to regain compliance with the Minimum Bid Price Requirement. The Company also informed the Panel of its plan to demonstrate its ability to regain compliance with the Minimum Bid Price Requirement. There can be no assurance that the Company will be able to regain compliance with the Minimum Bid Price Requirement. 43