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Item 2. Unregistered Sales of Equity Securities

2025-05-15 compared with 2024-11-14 · 3 added, 73 removed, 5 unchanged (94% of the section changed)

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

of Proceeds from Registered Securities

February 2, 2023, the Company entered into the Underwriting Agreement with Boustead, as representative of the underwriters named on Schedule

1 thereto, relating to the Company’s initial public offering of the IPO Shares.

Pursuant to the Underwriting Agreement, in exchange

for Boustead’s firm commitment to purchase the IPO Shares, the Company agreed to sell the IPO Shares to Boustead at the IPO Price

as reduced by a 0.75% non-accountable expense allowance, and the Representative’s Warrant.

February 3, 2023, the IPO Shares and 300,000 outstanding shares of Class B Common Stock that were registered for resale as described

below were listed and commenced trading on The Nasdaq Capital Market tier of Nasdaq.

closing of the initial public offering took place on February 7, 2023.

At the closing, the Company sold the IPO Shares for total gross

proceeds of $7,500,000.

After deducting the underwriting discounts, commissions, non-accountable expense allowance, and other expenses

from the initial public offering, the Company received net proceeds of approximately $6.6 million.

The Company also issued Boustead the

Representative’s Warrant exercisable for the purchase of 21,000 shares of Class B Common Stock at an exercise price of $31.25 per

share, subject to adjustment.

The Representative’s Warrant may be exercised by payment of cash or by a cashless exercise provision,

and may be exercised at any time for five years following the date of issuance.

IPO Shares were offered and sold, and the Representative’s Warrant was issued, pursuant to the IPO Registration Statement, initially

filed with the SEC on September 2, 2022, and declared effective by the SEC on February 2, 2023, and the Final IPO Prospectus filed with

the SEC on February 6, 2023 pursuant to Rule 424(b)(4) of the Securities Act.

In addition, a total of 300,000 shares of Class B Common

Stock were registered for resale by the selling stockholders named in the IPO Registration Statement and the related Final Resale Prospectus.

Any resales of these shares occurred at a fixed price of $25.00 per share until the Class B Common Stock was listed on Nasdaq.

these sales will occur at fixed prices, at market prices prevailing at the time of sale, at prices related to prevailing market prices,

or at negotiated prices.

The Company will not receive any proceeds from the resale of Class B Common Stock by the selling stockholders.

IPO Registration Statement also registered for sale shares of Class B Common Stock with a maximum aggregate offering price of $1,125,000

for an additional 45,000 shares of Class B Common Stock at the assumed public offering price of $25.00 per share upon full exercise of

the underwriters’ over-allotment option;

and up to an additional 3,150 shares of Class B Common Stock underlying the Representative’s

Warrant with a maximum aggregate offering price of $98,437.50 at the assumed exercise price of $31.25 per share assuming full exercise

of the over-allotment option.

The underwriters’ over-allotment option expired unexercised.

The Company has not received any proceeds

from the exercise of the Representative’s Warrant because it has not been exercised.

April 4, 2023, the Post-Effective Amendment was filed with the SEC and became effective on April 14, 2023.

The Post-Effective Amendment

was required to be filed to update the IPO Registration Statement to include, among other things, the information contained in our Annual

Report on Form 10-K for the fiscal year ended December 31, 2022, which was filed with the SEC on March 31, 2023.

The Post-Effective Amendment

maintained the effectiveness of the IPO Registration Statement with respect to the sale of shares of common stock issuable upon

exercise of the Representative’s Warrant and the resale of the shares of common stock held by the selling stockholders.

prospectuses were included with the Post-Effective Amendment.

The Post-Effective Amendment also incorporates by reference all documents

subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the termination of the

offering described in the prospectuses included with the Post-Effective Amendment.

stated in the IPO Registration Statement and the Final IPO Prospectus, the Company intended to use the net proceeds from the initial

public offering for investment in corporate infrastructure, marketing and promotion of Discord communities, social campaigns, and the

Company’s “AE.360.DDM” service, expansion of the Company’s “SiN” service, increasing staff and company

personnel, and general working capital, operating, and other corporate expenses.

As stated in the Post-Effective Amendment, the Company

intended to use any proceeds from the exercise of the Representative’s Warrant for working capital and general corporate purposes.

following is the Company’s reasonable estimate of the uses of the proceeds from the initial public offering from the date of the

closing of the offering on February 7, 2023 through September 30, 2024:

was used for construction of plant, building and facilities;

was used for the purchase and installation of machinery and equipment;

was used for purchases of real estate;

$0.3 million was used for the acquisition of other businesses;

was used for the repayment of indebtedness;

Approximately

$6.0 million was used for working capital;

None was used for temporary investments.

As of the date of this Quarterly Report on Form 10-Q, none of the proceeds from the initial public offering were used to make direct

or indirect payments to any of the Company’s directors or officers, any of their associates, any persons owning 10% or more of

any class of the Company’s equity securities, or any of our affiliates, or direct or indirect payments to any others other than

for the direct costs of the offering.

has not been, and the Company does not expect, any material change in the planned use of proceeds from the initial public offering as

described in the IPO Registration Statement and the Final IPO Prospectus or any exercise of the Representative’s Warrant, as described

in the Post-Effective Amendment.

Sales of Equity Securities

the three months ended September 30, 2024, we did not sell any equity securities that were not registered under the Securities Act and

that were not previously disclosed in a Current Report on Form 8-K.

the three months ended March 31, 2025, we did not sell any equity securities that were not registered under the Securities Act and that

were not previously disclosed in a Current Report on Form 8-K.

of Equity Securities

repurchases of our common stock were made during the three months ended September 30, 2024.

repurchases of our common stock were made during the three months ended March 31, 2025.

DEFAULTS UPON SENIOR SECURITIES.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Unregistered Sales of Equity Securities