What changed in this filing

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Item 1. Financial Statements

2026-08-14 compared with 2026-05-13 · 421 added, 406 removed, 788 unchanged (51% of the section changed)

Financial Statements

OSR HOLDINGS, INC.

OSR HEALTH, INC.

AND SUBSIDIARIES

3 unchanged sentences

Cash and cash equivalents

Trade and other receivables, less allowance for credit losses of $ 59,190.83 and $ 62,370.40 as of March 31, 2026 and December 31, 2025, respectively

Trade and other receivables, less allowance for credit losses of $ 60,013.69 and $ 62,370.40 as of June 30, 2026 and December 31, 2025, respectively

Inventories, net

29 unchanged sentences

Common stock, $ 0.0001 par value, Authorized 100,000,000 shares;

33,299,755 shares and 26,597,769 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively

35,118,692 shares and 26,597,769 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively

Additional paid-in capital

11 unchanged sentences

of the condensed consolidated financial statements.

OSR HOLDINGS, INC.

OSR HEALTH, INC.

AND SUBSIDIARIES

3 unchanged sentences

Three months ended

Six months ended

Cost of sales

3 unchanged sentences

( 5,229,177 )

( 6,700,098 )

( 8,147,004 )

Other income (expense):

1 unchanged sentence

Interest expense

( 31,224.22 )

( 16,398.73 )

Other expenses

( 8,696,361 )

( 8,489,401.10 )

Loss before income taxes

1 unchanged sentence

( 5,225,198 )

( 5,363,029 )

( 16,618,012 )

Income tax benefit

1 unchanged sentence

( 5,225,198 )

( 4,471,212 )

( 16,618,012 )

Attributable to:

OSR Holdings Co., Ltd.

OSR Health, Inc.

and subsidiaries

3 unchanged sentences

( 5,556,612 )

Other comprehensive income for the year, net of tax

( 5,556,612 )

Other comprehensive income for the period, net of tax

Gain on foreign currency translation

( 3,152,587 )

Total comprehensive loss for the year

( 9,242,645 )

Total comprehensive income(loss) for the period

$ ( 4,156,625 )

$ ( 13,713,857 )

$ ( 9,413,120 )

Attributable to:

OSR Holdings Co., Ltd.

OSR Health, Inc.

and subsidiaries

1 unchanged sentence

( 9,694,127 )

( 6,265,628 )

Non-controlling interests

( 2,890,640 )

Loss per share attributable to OSR Holdings Co., Ltd.

( 3,147,492 )

( 4,019,730 )

( 3,147,492 )

Income(loss) per share attributable to OSR Health, Inc.

and subsidiaries

Basic loss per ordinary share

Basic income(loss) per ordinary share

The accompanying notes are an integral part

of the condensed consolidated financial statements.

OSR HOLDINGS, INC.

OSR HEALTH, INC.

AND SUBSIDIARIES

18 unchanged sentences

$ 132,282,477

Balance at April 1, 2025

$ 106,082,223

$ ( 30,565,877 )

$ 132,282,477

Net gain(loss)

( 5,556,612 )

( 5,225,198 )

Changes in Excise tax

Foreign currency translation adjustment

Issuance of share capital

Balance at June 30, 2025

$ 106,896,221

$ ( 30,175,318 )

$ 139,153,045

Balance at January 1, 2026

10 unchanged sentences

( 28,657,776 )

( 22,663,298 )

Common stock issued by ELOC program

4 unchanged sentences

$ 127,391,119

Balance at April 1, 2026

$ 145,618,062

$ ( 40,101,342 )

$ ( 1,660,820 )

$ 127,391,119

( 1,004,038 )

Foreign currency translation adjustment

( 2,735,507 )

( 3,152,587 )

Common stock issued by ELOC program

Balance at June 30, 2026

$ 147,292,204

$ ( 40,950,247 )

$ ( 2,077,900 )

$ 124,908,818

The accompanying notes are an integral part

of the condensed consolidated financial statements.

OSR HOLDINGS, INC.

OSR HEALTH, INC.

AND SUBSIDIARIES

1 unchanged sentence

(In the United States Dollar)

Three months ended

Six months ended

Cash flows from operating activities:

1 unchanged sentence

$ ( 16,618,012 )

Adjustments to reconcile net (loss) income to cash used in operating activities:

Adjustments to reconcile net loss to cash used in operating activities:

Income tax benefit

( 452,313.95 )

Loss on inventory valuation

Lease expense

1 unchanged sentence

Commissions and professional fees

Loss on change in fair value of financial liabilities

Merger and acquisition costs

Loss on foreign currency translation

Gain on change in fair value of financial liabilities

Gain on foreign currency translation

Changes in operating assets and liabilities:

Decrease in trade and other receivables

Decrease(increase) in inventories, net

( 65,535.27 )

Increase in other current assets

( 11,598.99 )

Increase in trade and other payables

Decrease in inventories, net

Decrease (increase) in other current assets

Increase (decrease) in trade and other payables

Increase in accrued expenses

Decrease in lease liabilities

( 10,579.05 )

Increase (decrease) in tax payables

Decrease in other liabilities

( 2,299,156 )

Increase in tax payables

Increase in other liabilities

Net cash used in operating activities

( 3,422,481 )

( 64,069.29 )

Cash flows from investing activities:

1 unchanged sentence

Disposal of equipment and vehicles

Purchase of equipment and vehicles

Increase in long-term loan

( 14,538.66 )

Increase in cash and cash equivalents from business combination

Net cash provided by investing activities

Net cash provided by(used in) investing activities

Cash flows from financing activities:

Proceeds from short-term borrowing

Repayment of long-term debt

Repayment of short-term borrowing

( 39,287.71 )

Repayment of short-term corporate bonds

Issuance of convertible bonds

Repayment of convertible bonds

Proceeds from issuance of common stock

1 unchanged sentence

Net change in cash and cash equivalents

( 48,177.73 )

Effects of changes in exchange rate on cash and cash equivalents

( 85,393.40 )

( 16,748.58 )

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

$ 1,566,701.38

$ 1,595,696.90

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

Supplemental disclosures of cash flow information:

1 unchanged sentence

Cash paid for income taxes (net of refunds received)

( 30,150.26 )

The accompanying notes are an integral part

of the condensed consolidated financial statements.

OSR HOLDINGS, INC.

OSR HEALTH, INC.

NOTES TO CONDENSED

FINANCIAL STATEMENTS

March 31, 2026

June 30, 2026

(1) Organization and nature of business

OSR Holdings, Inc.

(the Company or

OSR Holdings) and its subsidiaries (collectively the Group) are a global healthcare company dedicated to advancing healthcare outcomes

and improving the quality of life for people and their families.

The Group aims to build and develop a robust portfolio of innovative

and potentially transformative therapies and healthcare solutions.

The Group’s current operating businesses (through the four wholly

owned subsidiaries) include (i) developing oral immunotherapies for the treatment of cancer, (ii) developing design-augmented biologics

for age-related and other degenerative diseases and (iii) neurovascular intervention medical device and systems distribution in Korea.

The Group’s vision is to acquire and operate a portfolio of innovative health-care related companies globally.

OSR Health, Inc.

(the Company or OSR

Health) and its subsidiaries (collectively the Group) are a global healthcare company dedicated to advancing healthcare outcomes and improving

the quality of life for people and their families.

The Group aims to build and develop a robust portfolio of innovative and potentially

transformative therapies and healthcare solutions.

The Group’s current operating businesses (through the five wholly owned subsidiaries)

include (i) developing oral immunotherapies for the treatment of cancer, (ii) developing design-augmented biologics for age-related and

other degenerative diseases and (iii) neurovascular intervention medical device and systems distribution in Korea, and (iv) developing

non-invasive biosensing technologies for blood glucose monitoring in Korea.

The Group’s vision is to acquire and operate a portfolio

of innovative health-care related companies globally.

The Company (formerly known as Bellevue

16 unchanged sentences

or BLAC” to “OSR Holdings, Inc.”

Effective June 11, 2026, the Company

changed its corporate name from “OSR Holdings, Inc.” to “OSR Health, Inc.” The name change did not amend any other

provision of the Company’s certificate of incorporation or alter the terms of the Company’s common stock or warrants, which

continue to trade on The Nasdaq Stock Market LLC under the symbols “OSRH” and “OSRHW,” respectively.

The Business Combination was consummated

15 unchanged sentences

financial liabilities ($ 4.2 million), other liabilities ($ 1.2 million).

Details of shareholders as of March

Details of shareholders as of June

30, 2026 are as follows:

4 unchanged sentences

Bellevue Capital Management LLC

Joint Protein Central Co., Ltd.

Details of investments in subsidiaries

as of March 31, 2026 are as follows:

Name of subsidiary Share

capital Percentage

of ownership Principal activities

VAXIMM AG (“VAXIMM”) 1,091,203,754 100.00 % Biotech (drug development)

as of June 30, 2026 are as follows:

Name of subsidiary Share capital Percentage of

ownership Principal activities Country of

incorporation

VAXIMM AG (“VAXIMM”) 707,884 100 % Biotech (drug development) Switzerland

RMC Co., Ltd.

(“RMC”) 35,000,000 100.00 % Medical device distribution

(“RMC”) 22,705 100 % Medical device distribution Republic of Korea

Darnatein Co., Ltd.

(“Darnatein”) 6,466,667,000 100.00 % Biotech (drug development)

OSR Holdings, Inc.

(“OSRI”) 2,826,969 100.00 % NASDAQ Listed Company

(“Darnatein”) 4,195,048 100 % Biotech (drug development) Republic of Korea

OSR Health, Inc.

(“OSRI”) 3,299 100 % NASDAQ Listed Company The United States

Woori-IO Co., Ltd.

(“Woori-IO”) 444,455,000 100.00 % Medical device distribution

(“Woori-IO”) 288,326 100 % Medical device development Republic of Korea

Key financial information of the subsidiaries

at March 31, 2026 are as follows :

at June 30, 2026 are as follows :

Name of subsidiary

1 unchanged sentence

Darnatein Co.,Ltd

OSR Holdings, Inc.(*1)

( 1,021,869 )

OSR Health, Inc.(*1)

( 1,105,626 )

(*1) Aforementioned above, the Company is treated as the acquired

2 unchanged sentences

Summaries of entities, which are newly

included in consolidation scope for the periods ended March 31, 2026 and 2025 are as follows:

For the three months ended March 31, 2026

included in consolidation scope for the periods ended June 30, 2026 and 2025 are as follows:

For the six months ended June 30, 2026

Name of subsidiary Reason Type of purchase consideration

1 unchanged sentence

Acquisition (*1) Equity swap with shares of OSR Holdings Co.,Ltd.

(*1) The Parent acquired subsidiary in January 26, 2026 and accounted

for the acquisitions at January 1, 2026, which is deemed the acquisition date.

For the three months ended March 31, 2025

(*1) The Parent acquired subsidiary

in January 26, 2026 and accounted for the acquisitions at January 1, 2026, which is deemed the acquisition date.

For the six months ended June 30, 2025

Name of subsidiary Reason Type of purchase consideration

OSR Holdings, Inc.

OSR Health, Inc.

Acquisition (*2) Equity swap with shares of the Parent and OSR inc.’s share

(*2) The Parent acquired subsidiary in February 2025 and accounted

for the acquisitions at March 31, 2025, which is deemed the acquisition date.

(*2) The Parent acquired subsidiary

in February 2025 and accounted for the acquisitions at March 31, 2025, which is deemed the acquisition date.

(2) Summary of significant accounting policies

5 unchanged sentences

The condensed consolidated financial

statements include the accounts of OSR Holdings, Inc.

statements include the accounts of OSR Health, Inc.

and its subsidiaries.

8 unchanged sentences

in which it has significant influence but not a controlling financial interest using the equity method of accounting.

Reclassifications

The Company has reclassified certain

amounts relating to its prior period results to conform to its current-period presentation.

These reclassifications have not changed the

results of operations of prior periods.

Use of estimates

56 unchanged sentences

useful lives as follows:

Estimated useful lives

Office equipment

63 unchanged sentences

● The lease term for all of the Group’s leases includes the noncancellable period of the lease plus

any additional periods covered by either a Group option to extend (or not to terminate) the lease that the Group is reasonably certain to exercise,

or an option to extend (or not to terminate) the lease controlled by the lessor.

any additional periods covered by either a Group option to extend (or not to terminate) the lease that the Group is reasonably certain

to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor.

● Lease payments included in the measurement of the lease liability comprise the following:

9 unchanged sentences

date, plus any initial direct costs incurred less any lease incentives received.

For operating leases, the ROU asset

is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus initial direct costs, plus (minus)

any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received.

Lease expense for lease payments is recognized

on a straight-line basis over the lease term.

ROU assets are periodically reduced

by impairment losses.

The Group uses the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment

– Overall , to determine whether an ROU asset is impaired, and if so, the amount of the impairment loss to recognize.

The Group monitors for events or changes

in circumstances that require a reassessment of one of its leases.

When a reassessment results in the remeasurement of a lease liability,

a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount

of the ROU asset to an amount less than zero.

In that case, the amount of the adjustment that would result in a negative ROU asset balance

is recorded in profit or loss.

Operating lease ROU assets are presented

as operating lease right of use assets on the condensed consolidated balance sheets.

The current portion of operating lease liabilities

are presented separately on the condensed consolidated balance sheets.

● For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying

amount of the lease liability, plus initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance

of lease incentives received.

Lease expense for lease payments is recognized on a straight-line basis over the lease term.

● ROU assets are periodically reduced by impairment losses.

The Group uses the long-lived assets impairment

guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall, to determine whether an ROU asset is impaired, and if

so, the amount of the impairment loss to recognize.

● The Group monitors for events or changes in circumstances that require a reassessment of one of its leases.

When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the

corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero.

In that case, the

amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss.

● Operating lease ROU assets are presented as operating lease right of use assets on the condensed consolidated

balance sheets.

The current portion of operating lease liabilities are presented separately on the condensed consolidated balance sheets.

The Group has elected not to recognize

13 unchanged sentences

Revenue recognition

The Group only has revenue from

The Group recognizes revenue when it satisfies performance obligations under the terms of its contracts, and control of

its products is transferred to its customers in an amount that reflects the consideration the Group expects to receive from its

customers in exchange for those products.

This process involves identifying the customer contract, determining the performance

obligations in the contract, determining the transaction price, allocating the transaction price to the distinct performance

obligations in the contract, and recognizing revenue when the performance obligations have been satisfied.

A performance obligation

is considered distinct from other obligations in a contract when it (a) provides a benefit to the customer either on its own or

together with other resources that are readily available to the customer and (b) is separately identified in the contract.

considers a performance obligation satisfied once it has transferred control of a good or product to a customer, meaning the

customer has the ability to direct the use and obtain the benefit of the good

The Group only has revenue from customers.

The Group recognizes revenue when it satisfies performance obligations under the terms of its contracts, and control of its products is

transferred to its customers in an amount that reflects the consideration the Group expects to receive from its customers in exchange

for those products.

This process involves identifying the customer contract, determining the performance obligations in the contract,

determining the transaction price, allocating the transaction price to the distinct performance obligations in the contract, and recognizing

revenue when the performance obligations have been satisfied.

A performance obligation is considered distinct from other obligations in

a contract when it (a) provides a benefit to the customer either on its own or together with other resources that are readily available

to the customer and (b) is separately identified in the contract.

The Group considers a performance obligation satisfied once it has transferred

control of a good or product to a customer, meaning the customer has the ability to direct the use and obtain the benefit of the good

Income taxes are accounted for under

41 unchanged sentences

Compound Financial Instruments

Compound financial instruments are

convertible bonds that can be converted into equity instruments at the option of the holder.

The liability component of a compound

financial instrument is recognized initially at the fair value of a similar liability that does not have an equity conversion right

and subsequently measured at amortized cost until extinguished on conversion or maturity of the bonds.

The equity component is

recognized initially on the difference between the fair value of the compound financial instrument as a whole and the fair value of

the liability component.

Any directly attributable transaction costs are allocated to the liability and equity components in

proportion to their initial carrying amounts.

Accounting pronouncements adopted as of March 31, 2026

Compound financial instruments are convertible

bonds that can be converted into equity instruments at the option of the holder.

The liability component of a compound financial instrument

is recognized initially at the fair value of a similar liability that does not have an equity conversion right and subsequently measured

at amortized cost until extinguished on conversion or maturity of the bonds.

The equity component is recognized initially on the difference

between the fair value of the compound financial instrument as a whole and the fair value of the liability component.

Any directly attributable

transaction costs are allocated to the liability and equity components in proportion to their initial carrying amounts.

Accounting pronouncements adopted as of June 30, 2026

In October 2021,

23 unchanged sentences

The Group adopted this ASU

as of January 1, 2025 and there is not impact on the Group’s consolidated financial statements.

Accounting pronouncements issued, but not adopted as of March 31, 2026

as of January 1, 2025 and there is no impact on the Group’s consolidated financial statements.

Accounting pronouncements issued, but not adopted as of June

In October 2023,

68 unchanged sentences

in use and decrease the asset’s recoverable amount materially.

● the carrying amount of the net assets of the entity is more than

its market capitalization.

● the carrying amount of the net assets of the entity is more

than its market capitalization.

Internal sources of information

● evidence is available of obsolescence or physical damage

of the patent technology.

● significant changes with an adverse effect on the entity

have taken place during the period, or are expected to take place in the near future, in the extent to which, or manner in which, the

patent technology is used or is expected to be used.

These changes include the patent technology becoming idle, plans to discontinue

or restructure the operation to which the patent technology belongs, and plans to dispose of the patent technology before the previously

expected date.

● evidence is available of obsolescence or physical damage of

the patent technology.

● significant changes with an adverse effect on the entity have

taken place during the period, or are expected to take place in the near future, in the extent to which, or manner in which, the patent

technology is used or is expected to be used.

These changes include the patent technology becoming idle, plans to discontinue or restructure

the operation to which the patent technology belongs, and plans to dispose of the patent technology before the previously expected date.

● evidence is available from internal reporting that indicates

3 unchanged sentences

risks such as market risk (exchange risk, interest rate risk), credit risk and liquidity risk due to various activities.

The Group’s overall

risk management policy focuses on volatility in the financial markets and focuses on minimizing any negative impact on financial performance.

Risk management is conducted under the supervision of the finance department according to the policy approved by the Board of Directors.

overall risk management policy focuses on volatility in the financial markets and focuses on minimizing any negative impact on financial

Risk management is conducted under the supervision of the finance department according to the policy approved by the Board

of Directors.

The finance department identifies, evaluates and manages financial risks in close cooperation with the sales departments.

Directors provides written policies on overall risk management principles and specific areas such as foreign exchange risk, interest rate

risk, credit risk, use of derivative and non-derivative financial instruments, and investments in excess of liquidity.

The Board of Directors provides written policies on overall risk management principles and specific areas such as foreign exchange risk,

interest rate risk, credit risk, use of derivative and non-derivative financial instruments, and investments in excess of liquidity.

Market risk management

13 unchanged sentences

Interest rate risk

Interest rate risk refers to the risk

that interest income and interest expenses arising from deposits or borrowings will fluctuate due to changes in market interest rates

in the future, which mainly arises from deposits and borrowings with floating interest rates.

The goal of interest rate risk management

is to maximize corporate value by minimizing uncertainty caused by interest rate fluctuations.

As of the end of the reporting period,

there are no financial instruments subject to a variable interest rate.

Price risk is the risk that the fair

value of a financial instrument or future cash flows will change due to changes in market prices other than interest rate or foreign exchange

As of the end of the reporting period, the Group is not exposed to commodity price risk.

Investments in financial instruments are

made on a non-recurring basis according to management’s judgment.

Interest rate risk refers to the risk that interest income and interest

expenses arising from deposits or borrowings will fluctuate due to changes in market interest rates in the future, which mainly arises

from deposits and borrowings with floating interest rates.

The goal of interest rate risk management is to maximize corporate value by

minimizing uncertainty caused by interest rate fluctuations.

As of the end of the reporting period, there are no financial instruments

subject to a variable interest rate.

Price risk is the risk that the fair value of a financial instrument

or future cash flows will change due to changes in market prices other than interest rate or foreign exchange rate.

As of the end of the

reporting period, the Group is not exposed to commodity price risk.

Investments in financial instruments are made on a non-recurring basis

according to management’s judgment.

Credit risk management

Credit risk is the risk of possible

losses in an asset portfolio in the events of counterparty’s default, breach of contract and deterioration in the credit quality

of the counterparty.

For the risk management reporting purposes, the Group manages the credit risk systematically and pursues value maximization

and continuous growth of the Group by efficient resource allocation and monitoring non-performing loans.

In order to reduce the risks

that may occur in transactions with financial institutions, such as cash and cash equivalents and various deposits, the Group conducts

transactions only with financial institutions with high creditworthiness.

As of March 31, 2026, the Group believes that there are low

signs of material default, and the maximum exposure to credit risk as of March 31, 2026 is equal to the book value of financial instruments

(excluding cash).

Credit risk is the risk of possible losses in an asset portfolio in

the events of counterparty’s default, breach of contract and deterioration in the credit quality of the counterparty.

management reporting purposes, the Group manages the credit risk systematically and pursues value maximization and continuous growth of

the Group by efficient resource allocation and monitoring non-performing loans.

In order to reduce the risks that may occur in transactions

with financial institutions, such as cash and cash equivalents and various deposits, the Group conducts transactions only with financial

institutions with high creditworthiness.

As of June 30, 2026, the Group believes that there are low signs of material default, and the

maximum exposure to credit risk as of June 30, 2026 is equal to the book value of financial instruments (excluding cash).

Liquidity risk management

The Group constantly monitors its liquidity

positions to ensure that no borrowing limits or commitments are breached to meet operating capital needs.

In estimating liquidity, we

also take into account external laws or legal requirements, such as the group’s financing plan, compliance with agreements, internal target

financial ratios and currency restrictions.

The Group’s liquidity risk analysis details as of March 31,

The Group constantly monitors its liquidity positions to ensure that

no borrowing limits or commitments are breached to meet operating capital needs.

In estimating liquidity, we also take into account external

laws or legal requirements, such as the group’s financing plan, compliance with agreements, internal target financial ratios and

currency restrictions.

The Group’s liquidity risk analysis details as of June 30, 2026

and December 31, 2025 are as follows:

March 31, 2026

June 30, 2026

Remaining maturity

Financial liabilities

Other Payables

5 unchanged sentences

Capital risk management

Capital includes issued capital, share

premium and all other equity reserves attributable to the equity holders of the Group.

The primary objective of the Group’s capital

management is to maximize the shareholder value.

The Group manages its capital structure

and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants.

To maintain or adjust

the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.

The Group uses the debt ratio as a capital management indicator.

This ratio is calculated by dividing total liabilities by total equity,

and total liabilities and total equity are calculated based on the amounts in the Group’s consolidated financial statements.

The group’s debt ratio as of March 31, 2026 and December

Capital includes issued capital, share premium and all other equity

reserves attributable to the equity holders of the Group.

The primary objective of the Group’s capital management is to maximize

the shareholder value.

The Group manages its capital structure and makes adjustments in light

of changes in economic conditions and the requirements of the financial covenants.

To maintain or adjust the capital structure, the Group

may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares.

The Group uses the debt ratio as

a capital management indicator.

This ratio is calculated by dividing total liabilities by net borrowings and total equity, and total liabilities

and total equity are calculated based on the amounts in the Group’s consolidated financial statements.

The group’s debt ratio as of June 30, 2026 and December 31, 2025

are as follows:

9 unchanged sentences

Book value and fair value of financial instruments

The difference between the carrying amount and fair value

of the Group’s financial assets and liabilities as of March 31, 2026 and December 31, 2025 are insignificant.

The difference between the carrying amount and fair value of the Group’s

financial assets and liabilities as of June 30, 2026 and December 31, 2025 are insignificant.

Fair value hierarchy

All financial assets and liabilities

for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as

follows, based on the lowest level input that is significant to the fair value measurement as a whole:

All financial assets and liabilities for which fair value is measured

or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level

input that is significant to the fair value measurement as a whole:

● Level 1 - Quoted (unadjusted) market prices in active markets

for identical assets or liabilities

● Level 2 - Valuation techniques for which the lowest level

input that is significant to the fair value measurement is directly or indirectly observable

● Level 3 - Valuation techniques for which the lowest level

input that is significant to the fair value measurement is unobservable

● Level 2 - Valuation techniques for which the lowest level input

that is significant to the fair value measurement is directly or indirectly observable

● Level 3 - Valuation techniques for which the lowest level input

that is significant to the fair value measurement is unobservable

Fair values of the Group’s financial

assets and liabilities as of March 31, 2026 and December 31, 2025 , which are accounted for

at amortized cost, are categorized as Level 3.

Recurring transfer between levels

of the fair value hierarchy

Fair value hierarchy classifications

of the financial instruments that are measured at fair value level 3 as at March 31, 2026 and December 31, 2025 are as follows:

March 31, 2026

assets and liabilities as of June 30, 2026 and December 31, 2025, which are accounted for at amortized cost, are categorized as Level

Recurring transfer between levels of the fair value

Fair value hierarchy classifications of the financial instruments that

are measured at fair value level 3 as at June 30, 2026 and December 31, 2025 are as follows:

June 30, 2026

Recurring fair value measurements

3 unchanged sentences

Financial liabilities at fair value through profit or loss

Valuation Techniques and the Inputs

Valuation techniques and inputs used

in the recurring and non-recurring fair value measurements categorized within Level 3 of the fair value hierarchy as at March 31, 2026

and December 31, 2025 are as follows:

The Group did not change any valuation

techniques in determining the fair value, which is categorized within Level 3 of the fair value hierarchy.

March 31, 2026

Fair Value Level Valuation

Techniques Inputs

Financial liabilities at fair value through profit or loss $ 2,374,582 3 Tsiveriotis-

Fernandes model Stock Volatility, Risk-free rate

December 31, 2025

Fair Value Level Valuation

Techniques Inputs

Financial liabilities at fair value through profit or loss $ 2,530,176 3 Tsiveriotis-

Fernandes model Stock Volatility, Risk-free rate

(6) Financial instruments by category

The carrying value of financial instruments category as of

March 31, 2026 and December 31, 2025 are as follows:

March 31, 2026

The carrying value of financial instruments category as of June 30,

2026 and December 31, 2025 are as follows:

June 30, 2026

Financial assets:

liabilities at

Cash and cash equivalents

7 unchanged sentences

Non-current financial liabilities

Derivative liabilities

December 31, 2025

Financial assets:

liabilities at

Cash and cash equivalents

7 unchanged sentences

Derivative liabilities

Net gains or losses by financial instrument category for

the three-months ended March 31, 2026 and 2025 are as follows:

Net gains or losses by financial instrument category for the six-months

ended June 30, 2026 and 2025 are as follows:

For the six-month ended

June 30, 2026

For the six-month ended

June 30, 2025

Amortized cost:

5 unchanged sentences

Losses on foreign currency translation

Financial liabilities measured at fair value through profit and loss:

Realized gain on financial liabilities measured at fair value

Gains on change in fair value of financial liabilities

Losses on change in fair value of financial liabilities

(7) Cash and cash equivalents

The Group considers all money market

funds and highly liquid financial instruments with original maturities of three months or less to be cash equivalents.

The Group considers all money market funds and highly liquid financial

instruments with original maturities of three months or less to be cash equivalents.

June 30, 2026

December 31, 2025

Cash and cash equivalents

(8) Trade and other receivables, net

All trade receivables are recorded

at the invoiced amount and do not bear interest.

Amounts collected on trade receivables are included in net cash provided by operating

activities in the statements of cash flows.

All trade receivables are recorded at the invoiced amount and do not

bear interest.

Amounts collected on trade receivables are included in net cash provided by operating activities in the statements of cash

The Group does not have any off-balance sheet credit exposure related to its customers.

3 unchanged sentences

Other receivables

Accrued revenue

(9) Inventories, net

Inventories consisted of the following as of March 31, 2026

and December 31, 2025:

Inventories consisted of the following as of June 30, 2026 and December

Merchandised goods

3 unchanged sentences

(10) Other financial assets

Details of other financial assets as of March 31, 2026 and

December 31, 2025 are as follows:

March 31, 2026

Details of other financial assets as of June 30, 2026 and December

31, 2025 are as follows:

June 30, 2026

December 31, 2025

2 unchanged sentences

(11) Other assets

Details of other assets as of March 31, 2026 and December

31, 2025 are as follows:

March 31, 2026

Details of other assets as of June 30, 2026 and December 31, 2025 are

June 30, 2026

December 31, 2025

2 unchanged sentences

Details of investment under the equity method are as follows:

March 31, 2026 December 31, 2025

Location Main

business Ownership Book value Ownership Book value

June 30, 2026 December 31, 2025

Location Main business Ownership Book value Ownership Book value

Taction Co., LTD Korea Software development 33.0 % $ -

The summarized financial information of investment under

the equity method as of the closing date and for the current period is as follows:

The summarized financial information of investment under the equity

method as of the closing date and for the current period is as follows:

As of and for the year ended December 31, 2025

1 unchanged sentence

Taction Co., LTD

There is no equity method valuation applied on investments

in associate for the three-months ended March 31, 2026 or 2025.

There is no equity method valuation applied on investments in associate

for the six-months ended June 30, 2026 or 2025.

Taction Co., Ltd.

was incorporated

to engage in software development and IT consulting.

As no practical plan to generate revenue and maintain going-concern basis in the

foreseeable future was provided, the Parent recognized impairment loss amounting to acquisition cost.

was incorporated to engage in software development

and IT consulting.

As no practical plan to generate revenue and maintain going-concern basis in the foreseeable future was provided, the

Parent recognized impairment loss amounting to acquisition cost.

(13) Equipment and vehicles, net

Equipment and vehicles consist as of March 31,

2026 and December 31, 2025:

Equipment and vehicles consist as of June 30, 2026 and December 31,

Office equipment

4 unchanged sentences

(14) Goodwill

Changes of goodwill for the three-months

ended March 31, 2026 and 2025 are as follows:

For the three-months ended March 31, 2026

Changes of goodwill for the six-months ended June 30, 2026 and 2025

are as follows:

For the six-months ended June 30, 2026

exchange rate

( 1,957,005 )

For the three-months ended March 31, 2025

For the six-months ended June 30, 2025

exchange rate

(15) Intangible assets, net

The acquired intangible assets, all

of which are being amortized, have an average useful life of approximately 20 years.

Intangible assets consist of the following as of

March 31, 2026 and December 31, 2025.

For the three months ended March 31, 2026

useful life Gross

The acquired intangible assets, all of which are being amortized, have

an average useful life of approximately 20 years.

Intangible assets consist of the following as of June 30, 2026 and December 31, 2025.

As of June 30, 2026

useful life Gross carrying

amount Accumulated

amortization Net

amortization Net carrying

Technology license 20 years $ 97,646 $ 91,472 $ 6,175

2 unchanged sentences

$ 163,938,379 $ 29,797,111 $ 134,141,267

For the three months ended December 31, 2025

useful life Gross

As of December 31, 2025

useful life Gross carrying

amount Accumulated

amortization Net

amortization Net carrying

Technology license 20 years $ 100,221 $ 94,586 $ 5,635

2 unchanged sentences

$ 169,539,441 $ 27,076,807 $ 142,462,634

Accumulated amortization expense for

intangible assets is $ 2,417,860 and $ 2,272,817 for the three-months ended March 31, 2026 and 2025, respectively.

Amortization expense for intangible assets is $ 4,771,194 and $ 4,624,214

for the six-months ended June 30, 2026 and 2025, respectively.

(16) Short-term borrowings