What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-10-14 compared with 2024-09-30 · 423 added, 280 removed, 415 unchanged (63% of the section changed)

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TGL has no substantive operations other than holding all of the outstanding

shares of ZCity Sdn Bhd (“ZCITY”), (formerly known as Gem Reward Sdn.

Bhd, underwent a name change on July 20, 2023).

originally established under the laws of the Malaysia on June 6, 2017, through a reverse recapitalization.

Prior to March 11, 2021, TGL and ZCITY were separate

companies under the common control of Kok Pin “Darren,” Tan which resulted from Mr.

Tan’s prior 100% ownership of TGL

and his prior 100% voting and investment control over ZCITY pursuant to the Beneficial Shareholding Agreements.

For a more detailed description

of the Beneficial Shareholding Agreements and Mr.

Tan’s common control over TGL and ZCITY see Part I, Item 1.

– Corporate Structure.”

On March 11, 2021, TGL and ZCITY were reorganized

into a parent subsidiary structure pursuant to the Share Swap Agreement in which TGL exchanged the swap shares for all of the issued and

outstanding equity of ZCITY.

Pursuant to the Share Swap Agreement, the purchase and sale of the swap shares was completed on March 11,

2021, but the issuance of the swap shares did not occur until October 27, 2021 when TGL amended its certificate of incorporation to increase

the number of its authorized common stock to a number that was sufficient to issue the swap shares.

As a result of the Share Swap Agreement,

(i) ZCITY became the 100% subsidiary of TGL and Kok Pin “Darren” Tan no longer had any control over the ZCITY ordinary shares

and (ii) Kok Pin “Darren” Tan the Initial ZCITY Stockholders and Chong Chan “Sam” Teo owned 100% of the shares

of TGL common stock (Kok Pin “Darren” Tan owning approximately 97%).

Subsequent to the date of the Share Swap Agreement, Kok

Pin “Darren” Tan transferred 9,529,002 of his 10,000,000 shares of TGL common stock to 16 individuals and entities and currently

owns less than 5% of our common stock.

-ZCITY Operation

shares of TADAA Technologies Sdn.

(“TADAA Technologies”), (formerly known as ZCity Sdn Bhd and Gem Reward Sdn.

underwent a name change on July 31, 2025 and July 20, 2023, respectively) and TADAA Ventures Sdn.

(formerly known as VWXYZ Venture

Sdn Bhd, underwent a name change on July 29, 2025).

It was originally established under the laws of the Malaysia on June 6, 2017, through

a reverse recapitalization.

Prior to March 11, 2021, TGL and TADAA Technologies

were separate companies under the common control of Kok Pin “Darren,” Tan which resulted from Mr.

Tan’s prior 100% ownership

of TGL and his prior 100% voting and investment control over TADAA Technologies pursuant to the Beneficial Shareholding Agreements.

a more detailed description of the Beneficial Shareholding Agreements and Mr.

Tan’s common control over TGL and TADAA Technologies

see Part I, Item 1.

“Business – Corporate Structure.”

On March 11, 2021, TGL and TADAA Technologies

were reorganized into a parent subsidiary structure pursuant to the Share Swap Agreement in which TGL exchanged the swap shares for all

of the issued and outstanding equity of TADAA Technologies.

Pursuant to the Share Swap Agreement, the purchase and sale of the swap shares

was completed on March 11, 2021, but the issuance of the swap shares did not occur until October 27, 2021 when TGL amended its certificate

of incorporation to increase the number of its authorized common stock to a number that was sufficient to issue the swap shares.

result of the Share Swap Agreement, (i) TADAA Technologies became the 100% subsidiary of TGL and Kok Pin “Darren” Tan no longer

had any control over the TADAA Technologies ordinary shares and (ii) Kok Pin “Darren” Tan the Initial TADAA Technologies Stockholders

and Chong Chan “Sam” Teo owned 100% of the shares of TGL common stock (Kok Pin “Darren” Tan owning approximately

Subsequent to the date of the Share Swap Agreement, Kok Pin “Darren” Tan transferred 9,529,002 of his 10,000,000 shares

of TGL common stock to 16 individuals and entities and currently owns less than 5% of our common stock.

-TADAA Technologies Operation

We have created an innovative online-to-offline

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seamless e-payment solution with rebates in both e-commerce (i.e., online) and physical retailers/merchant (i.e., offline) settings.

Our proprietary product is an application branded

“ZCITY App,” which was developed through ZCITY.

Our proprietary product is an application branded “ZCITY

App,” which was developed through TADAA Technologies.

The ZCITY App was successfully launched in Malaysia on June 2020.

equipped with the know-how and expertise to develop additional/add-on technology-based products and services to complement the ZCITY App,

thereby growing its reach and user base.

Through simplifying a user’s e-payment gateway experience, as

well as by providing great deals, rewards and promotions with every use, we aim to make the ZCITY App Malaysia’s top reward and

loyalty platform.

Our longer-term goal is for the ZCITY App and its ever-developing technology to become one of the most well-known commercialized

applications more broadly in Southeast Asia and Japan.

As of September 25, 2024, we had 2,704,306 registered users and 2,027 registered

TADAA Technologies

is equipped with the know-how and expertise to develop additional/add-on technology-based products and services to complement the ZCITY

App, thereby growing its reach and user base.

Through simplifying a user’s e-payment gateway

experience, as well as by providing great deals, rewards and promotions with every use, we aim to make the ZCITY App Malaysia’s

top reward and loyalty platform.

Our longer-term goal is for the ZCITY App and its ever-developing technology to become one of the most

well-known commercialized applications more broadly in Southeast Asia and Japan.

As of February 10, 2025, we had 2,707,610 registered

users and 2,027 registered merchants.

Southeast Asia (“SEA”) consumers

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and its subsidiaries did not have material impact to our operation.

-Customized Software development service

During the fiscal year, the Company initiated

a new revenue stream in the ordinary course of business by offering customized software development services, primarily targeting enterprise

As of January 2025, we have entered into a new service partnership with Reveillon Group Limited to design, develop, and implement

a comprehensive digital system.

This initiative involves the creation of integrated modules focused on improving administrative processes,

data analysis, and user engagement.

The system is being built with scalability, customization, and long-term performance in mind, ensuring

it meets evolving business needs.

This collaboration underscores our ongoing commitment to delivering robust and adaptable digital solutions

across various industries.

The project is scheduled for completion within 12 months of the agreement’s start date.

Recent Development

- Corporate Development

On February 11, 2025, we signed a share purchase agreement to acquire

a 51% stake in Tien Ming Distribution Sdn Bhd to expand FMCG fulfilment and logistics capabilities.

The transaction was subsequently terminated

and no business combination was recognized for the year ended June 30, 2025.

- Reverse Stock Splits

On February 27, 2024, we effected a 1:70 reverse

stock split of its shares of common stock.

Upon execution of the 1-for-70 reverse stock split (“February 2024 split”).

April 7, 2025, the Company effected a 1:50 reverse stock split of its shares of common stock (“April 2025 split”).

We believed it is appropriate to reflect the above

transactions on a retroactive basis similar to those after a stock split or dividend pursuant to ASC 260.

All shares and per share amounts

used herein Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations have been retroactively

stated to reflect the effect of the February 2024 Split and April 2025 Split.

- Financing Development

On August 15, 2022, we had closed our initial

underwritten public offering of 32,858 (2,300,000 pre reverse split) shares of common stock, par value $0.00001 per share, at $280 ($4.00

pre reverse split) per share.

Meanwhile we received net proceeds of approximately $8.2 million, net of underwriting discounts and commissions

and fees, and other estimated offering expenses amounted to approximately $1.0 million.

On November 30, 2023, we closed our underwritten

public offering (the “November 2023 Offering”) of (i) 371,629 (26,014,000 pre reverse split) shares of common stock, at a

public offering price of $7 ($0.10 pre reverse split) per share of Common Stock and (ii) 14,000,000 pre-funded warrants (the “Pre-Funded

Warrants”), each with the right to purchase 0.01 (one share pre reverse split) of Common Stock, at a public offering price of $0.0999

per Pre-Funded Warrant.

Upon closing of the November 2023 Offering, we received aggregate net proceed of approximately $3.5 million, after

deducting underwriting discounts and commission, and non-accountable expense.

22, 2024, we have entered into a marketing offering agreement (“Marketing Offering Agreement”) with H.C.

Co., LLC, (the “Manager”).

Pursuant to the Marketing Offering Agreement, the Company intends to issue and sell through or

to the Manager, as sales agent and / or principal from time to time of the Company’s common stock at the Market Offering.

year ended June 30, 2024, we have received an aggregated net proceed of $431,811, net of broker fee from issuance of 94,889 shares of

common stock which sell through or to the Manager.

public offering (the “November 2023 Offering”) of (i) 7,433 shares of common stock, at a public offering price of $350 per

share of Common Stock and (ii) 4000 pre-funded warrants (the “Pre-Funded Warrants”), each with the right to purchase one of

Common Stock, at a public offering price of $350 per Pre-Funded Warrant.

Upon closing of the November 2023 Offering, we received aggregate

net proceed of approximately $3.5 million, after deducting underwriting discounts and commission, and non-accountable expense.

On March 22, 2024, we entered into a marketing

offering agreement (“Marketing Offering Agreement”) with H.C.

Wainwright & Co., LLC, (the “Manager”).

to the Marketing Offering Agreement, the Company intends to issue and sell through or to the Manager, as sales agent and / or principal

from time to time of the Company’s common stock at the Market Offering.

As of June 30, 2025, we have received an aggregated net

proceed of approximately $2.9 million, net of broker fee from issuance of 33,566 shares of common stock which sell through or to the Manager.

On October 10, 2024, we entered into a Share Purchase

Agreement (the “Purchase Agreement”) with Alumni Capital LP (“Alumni Capital”), a Delaware limited partnership

which was subsequently amended by the Modification Agreement on January 21, 2025 .

Pursuant to the Purchase Agreement, we have the right,

but not the obligation to cause Alumni Capital to purchase up to $50,000,000 common stock, par value $0.00001 (the “Commitment Amount”),

at certain purchase Price during the period beginning on the execution date of the Purchase Agreement and ending on the earlier of (i)

the date on which Alumni Capital has purchased $50,000,000 of the Company’s common stock pursuant to the Purchase Agreement or (ii)

December 31, 2025.

As of June 30, 2025, Alumni Capital has purchased approximately $11.7 million worth of the Company’s common stock,

totaling 3,163,680 shares.

The Company has received approximately $11.7 million in net proceeds as of June 30, 2025.

On November 27, 2024, we entered into a subscription

agreement (the “Subscription Agreement”) with certain investors (the “Investors”).

Pursuant to the Subscription

Agreement, the Investors agreed to invest an aggregate amount of $1,177,000 (the “Investment Amount”) into us for 71,333 shares

of the Company’s common stock (the “Offered Shares”), par value $0.00001 at a negotiated purchase price of $16.5 (the

As of June 30, 2025, the Company has issued 71,333 shares of Offered Shares to the Investors and received aggregate

net proceed of $1,177,000.

-Business Development

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participation from merchant clients, management has decided to discontinue the program as of June 2024.

Since July 2024, we formalized agreements to develop and implement

a Smart Campus System at ELMU University in Nilai, Malaysia.

Leveraging our expertise in infrastructure management, we worked with ELMU

University to deploy an automated smart campus system that will enhance resource management across the campus, with a strong focus on

optimizing electricity usage through integrated software and hardware solutions.

During fiscal 2025, following further discussions on

program priorities and timing, the parties concluded the engagement.

We have ceased work and demobilized.

No further performance obligation

remains under this engagement.

Since September 2024, we have been driving the

development of credit services within the ZCity App through a strategic partnership with Credilab Sdn Bhd (“CLSB”).

in the midst of facilitating the integration of CLSB’s credit services platform into the ZCity App and developing the customer base

for these services.

Through the partnership, we intend to collaborate on the creation of a digital wallet, AI-driven chatbot, and customer

support systems.

The collaboration is designed to drive user engagement and enhance the overall credit services offering within the ZCity

App ecosystem.

The partnership is scheduled to conclude on September 19, 2029, during which CLSB has also granted TGL a non-exclusive

right to use its brand in marketing materials for five years.

Since October 2024, we have been advancing our

user engagement strategy by partnering with Octagram Investment Limited (“OCTA”) to develop and integrate mini-game modules

into the ZCity App.

We have worked closely with OCTA to design and customize these interactive modules, ensuring they align with our specifications

for game mechanics, branding, and user experience.

The integration is optimized for cross-platform compatibility and smooth performance

across devices, as well as ensuring ongoing support and timely updates, maintaining the seamless functionality of the mini-games with

future ZCity App updates.

We believe that this initiative is key to enhancing the app’s interactive features and driving user engagement.

In October 2024, we have also been developing

a cutting-edge Live Streaming Platform enhanced by AI Digital Human Solutions by partnering with V Gallant Sdn Bhd.

We will be overseeing

the customization of the platform to meet specific requirements, ensuring seamless integration with third-party platforms and optimizing

performance across devices.

Ongoing support and updates will also be prioritized to maintain consistent functionality.

This initiative

is central to our efforts to expand our interactive streaming capabilities and elevate user experiences.

The development is scheduled

to be completed on December 31, 2025.

On October 29, 2024, we entered into a service

agreement with V Gallant Sdn Bhd to provide generative AI solutions and AI digital human technology services.

On March 24, 2025, we executed

a supplemental letter expanding the scope of that agreement to require V Gallant to provide and manage GPU servers, network infrastructure,

cloud integration, security measures, AI tools, and user environments to support AI cloud infrastructure.

On March 24, 2025, we executed a supplemental letter expanding the

scope of that agreement to require V Gallant to provide and manage GPU servers, network infrastructure, cloud integration, security measures,

AI tools, and user environments to support AI cloud infrastructure.

During fiscal 2025 we advanced software and AI infrastructure development.

Key Factors that Affect Operating Results

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by our consumers .

Consumers are attracted to ZCITY by the breadth

of personalized deals/rewards and the interactive user experience our platform offers.

The number and volume of transaction completed

by our member consumers is affected by our ability to continue to enhance and expand our product and service offerings and improve the

user experience.

Consumers are attracted to TADAA Technologies by the breadth of personalized

deals/rewards and the interactive user experience our platform offers.

The number and volume of transaction completed by our member consumers

is affected by our ability to continue to enhance and expand our product and service offerings and improve the user experience.

Empowering data and technology.

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Number of new participating merchants

Registered are persons who have registered on the ZCITY App.

Active users are users who have logged into the ZCITY App at least once.

(1) Registered are persons who have

registered on the ZCITY App.

(2) Active users are users who have

logged into the ZCITY App at least once.

September 30,

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On average, our registered user base has grown by approximately 0.1% over

the past five quarters, while our active user numbers have experienced an average decline of 38.3%.

the past five quarters, while our active user numbers have experienced an average decrease of 32.0%.

The decline in growth of registered users and

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resulting in fewer E-vouchers available for sale.

Additionally, we’ve implemented reductions in marketing spending and customer rewards

to enhance cost-effectiveness and operational profitability.

Consequently, this has led to a decrease in new user registrations and lower

retention rates among active users on our ZCITY platform.

Additionally, we’ve implemented reductions in marketing spending and customer

rewards to enhance cost-effectiveness and operational profitability.

Consequently, this has led to a decrease in new user registrations

and lower retention rates among active users on our ZCITY platform.

We continuously monitor the development and participation

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Sublicence revenue

Customized software development service

Total revenues

Total revenues decreased by approximately $19.7

million or 68.2% to approximately $22.1 million for the year ended June 30, 2024 from approximately $69.4 million for the year ended

million or 89.4% to approximately $2.3 million for the years ended June 30, 2025 from approximately $22.1 million for the years ended

June 30, 2024.

The decrease was mainly attributable to the decrease in product and loyalty program revenue.

The decrease was mainly attributable to the decrease in product and loyalty program revenue offset by increase in

revenue from customized software development service .

Product and loyalty program revenue

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also engage in sales of food and beverage products through our subsidiaries, Morgan and AY Food, despite they were disposed in May 2024.

The product and loyalty program revenue decrease by approximately $47.4 million or 68.9% to approximately $21.5 million for the year ended

The product and loyalty program revenue decrease by approximately $20.8 million or 97.1% to approximately $0.6 million for the years ended

June 30, 2025 from approximately $21.5 million for the same period in 2024.

The decrease in revenue was primarily attributable to our

strategic decision to reduce spending on customer rewards and marketing campaigns in order to enhance cost-effectiveness and profitability

in our operations.

This reduction in customer incentives and marketing expenditures resulted in a decrease in the platform’s appeal to

both existing and potential customers, ultimately leading to a decline in revenue for the current period.

The decline in revenue was primarily driven by the company’s

strategic decision to streamline its product line, with a particular focus on eliminating lower-margin products, mainly e-vouchers.

addition, the decrease was attributable our strategic decision to reduce spending on customer rewards and marketing campaigns in order

to enhance cost-effectiveness and profitability in our operations.

This reduction in customer incentives and marketing expenditures resulted

in a decrease in the platform’s appeal to both existing and potential customers, ultimately leading to a decline in revenue for

the current period.

Transaction revenue

The transaction revenue primarily consists of

fees charged to merchants for participating in our ZCITY platform upon successful sales transaction and payment service taken place between

the merchants and their customers online.

Our transaction revenue decreased by 18.6% to approximately $61,000 for the year ended June

30, 2024 from approximately $75,000 for the same period in 2023 due to lack of new enrolment of merchant client.

Our average percentage

of growth of new merchants was approximately 0.2% throughout the quarters as of June 30, 2024.

Transaction revenue primarily consists of fees charged to merchants

for participating in our ZCITY platform upon successful sales and service transactions, as well as for payment services facilitated between

merchants and their customers online.

Our transaction revenue increased by 107.6%, reaching approximately $127,000 for the years ended

June 30, 2025, compared to approximately $61,000 for the same period in 2024.

This growth was driven by our recent partnership with Credilab

(“CLSB”), a third-party credit services provider.

Through this partnership, we introduced our portfolio clients

from TADAA Technologies to CLSB’s credit service platform.

In return, CLSB agreed to pay us a transaction fee upon successful transactions

and share 50% of the revenue derived from these Portfolio Clients.

Member subscription revenue

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of fees charged to customers who sign up for Zmember, our membership program that offers exclusive savings, bonuses, and referral rewards.

For the year ended June 30, 2024, member subscription revenue decreased by 2.0% to approximately $376,000, from approximately $384,000

for the same period in 2023.

The decrease was primarily due to we experienced slowdown in acquiring new customers to participate in our

Zmember program .

For the years ended June 30, 2025, member subscription revenue decreased by 72.5% to approximately $0.1 million, from approximately $0.4

million for the same period in 2024.

The decrease was primarily due to we experienced slowdown in acquiring new customers to participate

in our Zmember program.

As of June 30, 2025 and 2024, we had 27,620 and 28,927 customers who subscribed to our Zmember program, respectively.

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Trademark from us.

For the years ended June 30, 2024 and 2023, sublicense revenue was amounted to approximately $174,000 and $50,000,

respectively.

As we had disposed Foodlink and its subsidiaries along with the food distribution and sublicensing operation in May

2024, we would no longer generate revenue from sublicense going forward.

Customized software development services

During the fiscal year, the Company initiated

a new revenue stream in the ordinary course of business by offering customized software development services, primarily targeting enterprise

As of January 2025, we have entered into a new service partnership with Reveillon Group Limited to design, develop, and implement

a comprehensive digital system.

This initiative involves the creation of integrated modules focused on improving administrative processes,

data analysis, and user engagement.

The system is being built with scalability, customization, and long-term performance in mind, ensuring

it meets evolving business needs.

This collaboration underscores our ongoing commitment to delivering robust and adaptable digital solutions

across various industries.

The project is scheduled for completion within 12 months of the agreement’s start date

Cost of revenue

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Sublicense revenue

Customized software development service

Total cost of revenue

Cost of revenue mainly consists of the purchases

of the gift card or “E-voucher” pin code, health care product and food and beverage products which is directly attributable

Cost of revenue primarily consists of purchases

of gift cards or “E-voucher” PIN codes, healthcare products, and food and beverage products, which are directly attributable

to our product revenue.

Cost of revenue also consists of monthly license payment made to our licensor to maintain our good standing for

the right of use the Trademark which is attributable to our sublicense revenue.

Total cost of revenue decreased by approximately $47.6

million or 69.2% for the year ended June 30, 2024 compared with the same period in 2023.

The decrease was in line with our decrease in

It also includes monthly license payments made to our licensor to maintain our right to use the Trademark, which

supports our sublicense revenue.

In addition, cost of revenue includes both in-house labor and outsourced labor costs related to customized

software development services.

Total cost of revenue decreased by approximately $21.0 million, or 96.9%, for the years ended June 30,

2025, compared to the same period in 2024.

The decrease was consistent with the decline in our revenue.

Our gross profit from our major revenue categories

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Gross (loss) profit

Customized software development service revenue

Gross (loss) profit

Our gross profit for the year ended June 30, 2025,

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approximately $0.8 million or 104.6%.

Our gross margin improved from 0.8% for the year ended June 30, 2023 from 3.7% for the same period

Our gross margin improved to 71.6% for the year ended June 30, 2025 from 3.7% for the same period

in 2024, representing an enhancement of 67.9% in our gross margin percentage.

The increase in both gross profit and gross margin

were mainly attributed to our decision to reduce spending on customer rewards within our ZCITY platform, resulting in a decrease in deferred

revenue and consequently leading to higher gross profit and gross margin in the current period.

The increase in gross profit and gross profit

margin for the years ended June 30, 2025, was primarily attributable to our engagement in a customized software development project during

the period, which generated approximately $1.0 million in gross profit.

This project carried a relatively high gross profit margin of

approximately 77.8%, which boosted our overall gross profit margin for the year ended June 30, 2025.

Operating expenses

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For the years ended June 30, 2025 and 2024,

we incurred approximately $0.4 million and $1.8 million, respectively, in marketing and promotion expense, and recognized the same amount

of product revenue at the time of redemption of the non-spending related activities reward points by our customers.

we incurred approximately $34,000 and $0.4 million, respectively, in marketing and promotion expense, and recognized the same amount of

product revenue at the time of redemption of the non-spending related activities reward points by our customers.

The decrease in marketing

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General and administrative expenses

General and administrative expenses amounted to

approximately $4.5 million and $4.7 million for the years ended June 30, 2024 and 2023, respectively, representing a decrease of approximately

$0.2 million or 3.4%.

The decrease was primarily attributed to decrease in salary expenses and professional fee expense of approximately

$0.6 million and $0.7 million, respectively, to promote our operation effectiveness, offset by the increase in depreciation and amortization

expense of approximately $0.6 million as we acquired more intangible assets during the year ended June 30, 2024, and incurred more bad

debts expense of approximately $0.4 million due to increase of allowance for credit loss against accounts receivable and other receivables.

General and administrative expenses amounted to approximately $3.6

and $4.5 million for the years ended June 30, 2025 and 2024, respectively, representing a decrease of approximately $0.9 million or 19.5%.

The decrease was primarily attributed to decrease salary expenses of approximately $0.8 million, decrease of professional fee of approximately

$0.4 million, decrease of D&O insurance of approximately $0.6 million, and decrease of depreciation and amortization expense of approximately

$0.2 million to promote our operation effectiveness.

Research and development expenses

Research and development expense amounted to approximately

$0.5 million for the years ended June 30, 2024 and 2023, representing 6.5% decrease as we incurred less spending in mobile application

or website development.

Research and development expense amounted to approximately $0.2 million

and $0.5 million for the years ended June 30, 2025 and 2024, respectively, representing 58.0% increase as we incurred more spending in

A.I related infrastructure development.

The increase primarily reflects costs for software engineering, cloud infrastructure and GPU-related

development supporting the live-streaming/AI program described in “Business Development.”

Long-live assets impairment

Long-live assets impairment amounted to approximately

$19.5 million and $0 for the years ended June 30, 2025 and 2024, respectively, representing 100.0% increase as we incurred $19.5 million

impairment in our intangible assets.

Stock-based compensation expenses

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The stock-based

compensation incurred for the years ended June 30, 2024, was related to compensation paid to our executive officer as part of their compensation

plan and third party for professional service .

Other expense, net

compensation incurred for the years ended June 30, 2025 and 2024, was related to compensation paid to our executive officer as part of

their compensation plan and third party for professional service.

The increase in stock-based compensation during the year ended June

30, 2025, was primarily attributable to the our decision to grant additional equity incentives to our executive officer in order to align

their interests with those of our shareholders and to encourage their continued commitment toward supporting the our long-term growth.

Other income (expense), net

Other expense, net, amounted to approximately

$0.5 million and $1.4 million for the years ended June 30, 2024 and 2023, respectively, representing

a decrease of approximately $0.9 million which was primarily attributable to we incurred other income from software developing service,

net of cost of approximately $0.7 million, other income of approximately $0.2 million from disposal of Foodlink and its subsidiaries,

and a decrease of amortization of debt discount of approximately $0.9 million related to our convertible note payable as we had fewer

convertible notes containing debt discount that needed to be amortized for the year ended June 30, 2024 compare to the same period in

2023, offset by an unrealized loss approximately $0.8 million from marketable securities we received as service consideration in development

of an artificial intelligence powered travel platform, redemption premium of approximately $0.3 million remit to our convertible note

holder as a result of floor price triggering event.

$1.0 million and $0.5 million for the year ended June 30, 2025 and 2024, respectively.

This change was primarily attributable to (i) an

increase in the gain from the change in fair value of derivative liabilities of approximately $1.8 million, (ii) a decrease in unrealized

loss of approximately $0.7 million on marketable securities received as service consideration in connection with the development of an

artificial intelligence–powered travel platform, (iii) a decrease in amortization of debt discount of approximately $0.4 million

as the convertible notes were fully converted during the year ended June 30, 2024.

These increases were partially offset by a decrease

in other income of approximately $0.7 million, as we recognized other income from software development services, net of cost, during the

year ended June 30, 2024, but did not recognize similar income in the same period of 2025, and (v) and increase in share-based compensation

adjustment of approximately $2.7 million which was attributable to our agreement to settle additional share compensation requested by

V Gallant Sdn.

pursuant to the Service Agreement dated October 29, 2024, as supplemented on March 28, 2025, to reflect the decline

in our share price.

Provision for income taxes

Provision for income taxes amounted to approximately $349,000

$40,000 and $98,000 for the years ended June 30, 2024 and 2023, respectively.

The amount was mainly attributable to tax imposed on

us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis.

We also were subject

to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled

foreign corporations with a tax rate of 35%.

In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”)

tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax

rate of 21%) with a partial offset for 80% foreign tax credits.

and $40,000 for the years ended June 30, 2024 and 2023.

The amount was mainly attributable to tax imposed on us from the State of Delaware,

as we are required to remit franchise tax to the State of Delaware on an annual basis.

We also were subject to controlled foreign corporations

Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a

tax rate of 35%.

In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which

is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%)

with a partial offset for 80% foreign tax credits.

If the foreign tax rate is 13.125% or higher, there will be no U.S.

tax after the 80% foreign tax credits are applied.

For the years ended June 30, 2024 and 2023, our foreign subsidiaries did not generate

any income that are subject to Subpart F tax and GILTI tax.

Our net losses decreased by approximately $5.1

million predominately due to the reasons as discussed above.

corporate tax after

the 80% foreign tax credits are applied.

For the years ended June 30, 2025 and 2024, our foreign subsidiaries did not generate any

income that are subject to Subpart F tax and GILTI tax.

We generated net loss of approximately $23.4 million

and $6.6 million for the years ended June 30, 2025 and 2024, respectively, representing a change of approximately $6.4 million.

was primarily attributable to the factors discussed above.

Liquidity and Capital Resources

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As of June 30, 2025 and 2024, we had approximately

$0.2 million and $4.6 million, respectively, in cash and cash equivalent which primarily consists of bank deposits, which are unrestricted

as to withdrawal and use.

On August 15, 2022, we had closed our initial

underwritten public offering of 2,300,000 shares of common stock, par value $0.00001 per share, at $4.00 per share.

We received aggregate

net proceeds from the closing of approximately $8.2 million, after deducting underwriting discounts and commissions and fees, and other

estimated offering expenses which amounted to approximately $1.0 million.

From February to June 2023, we issued two convertible

notes to a third party in an aggregate principal amount of $5,500,000.

We received $5,060,000 in proceeds from the third-party net of

The convertible notes accrued interest at 4% per annum and had a 12-month term.

On December 6, 2023, we paid a total of $2,102,909.59

which represented the outstanding balance of one of the convertible notes issued pursuant to the securities purchase agreement.

convertible note had already been fully converted into shares of our common stock prior to December 6, 2023.

$0.2 million, in cash and cash equivalent which primarily consists of bank deposits, which are unrestricted as to withdrawal and use.

On November 30, 2023, we closed our November 2023

Offering of (i) 26,014,000 shares of common stock, at a public offering price of $0.10 per share, and (ii) 14,000,000 Pre-Funded Warrants,

each with the right to purchase one share of Common Stock, at a public offering price of $0.0999 per Pre-Funded Warrant.

of the November 2023 Offering, we received aggregate net proceed of approximately $3.5 million, after deducting underwriting discounts,

and non-accountable expense.

22, 2024, we have entered into a marketing offering agreement (“Marketing Offering Agreement”) with H.C.

Co., LLC, (the “Manager”).

Pursuant to the Marketing Offering Agreement, the Company intends to issue and sell through or

to the Manager, as sales agent and / or principal from time to time of the Company’s common stock at the Market Offering.

year ended June 30, 2024, we have received an aggregated net proceed of $431,811, net of broker fee from issuance of 94,889 shares of

common stock which sell through or to the Manager.

From July to September 2024,

the Company received net proceed of $2,457,456, net of broker fee from issuance of 1,583,418 shares of common stock which sell through

or to the Manager related to the Marketing Offering Agreement.

Despite receiving the proceeds from offerings,

and issuance of convertible notes, management is of the opinion that we will not have sufficient funds to meet the working capital requirements

and debt obligations as they become due starting from one year from the date of this report due to our recurring loss.

Therefore, management

has determined there is substantial doubt about our ability to continue as a going concern.

If we are unable to generate significant revenue,

we may be required to curtail or cease our operations.

Management is trying to alleviate the going concern risk through the following

Offering of (i) 7,433 shares of common stock, at a public offering price of $350 per share of Common Stock and (ii) 4000 pre-funded warrants

(the “Pre-Funded Warrants”), each with the right to purchase one of Common Stock, at a public offering price of $350 per Pre-Funded

Upon closing of the November 2023 Offering, we received aggregate net proceed of approximately $3.5 million, after deducting

underwriting discounts and commission, and non-accountable expense.

On March 22, 2024, we entered into a marketing

offering agreement (“Marketing Offering Agreement”) with H.C.

Wainwright & Co., LLC, (the “Manager”).

to the Marketing Offering Agreement, the Company intends to issue and sell through or to the Manager, as sales agent and / or principal

from time to time of the Company’s common stock at the Market Offering.

As of June 30, 2025, we have received an aggregated net

proceed of approximately $2.9 million, net of broker fee from issuance of 33,566 shares of common stock which sell through or to the Manager.

On October 10, 2024, we entered into a Share Purchase

Agreement (the “Purchase Agreement”) with Alumni Capital LP (“Alumni Capital”), a Delaware limited partnership

which was subsequently amended by the Modification Agreement on January 21, 2025.

Pursuant to the Purchase Agreement, we have the right,

but not the obligation to cause Alumni Capital to purchase up to $50,000,000 common stock, par value $0.00001 (the “Commitment Amount”),

at certain purchase Price during the period beginning on the execution date of the Purchase Agreement and ending on the earlier of (i)

the date on which Alumni Capital has purchased $50,000,000 of the Company’s common stock pursuant to the Purchase Agreement or (ii)

December 31, 2025.

As of June 30, 2025, Alumni Capital has purchased approximately $11.7 million worth of the Company’s common stock,

totaling 3,163,680 shares.

The Company has received approximately $11.7 million in net proceeds as of June 30, 2025.

On November 27, 2024, we entered into a subscription

agreement (the “Subscription Agreement”) with certain investors (the “Investors”).

Pursuant to the Subscription

Agreement, the Investors agreed to invest an aggregate amount of $1,177,000 (the “Investment Amount”) into us for 71,333 shares

of the Company’s common stock (the “Offered Shares”), par value $0.00001 at a negotiated purchase price of $16.5 (the

As of June 30, 2025, the Company has issued 71,333 shares of Offered Shares to the Investors and received aggregate

net proceed of $1,177,000.

Despite receiving the proceeds from various offerings,

management is of the opinion that we will not have sufficient funds to meet the working capital requirements and debt obligations as they

become due starting from one year from the date of this report due to our recurring loss.

Therefore, management has determined there is

substantial doubt about our ability to continue as a going concern.

If we are unable to generate significant revenue, we may be required

to curtail or cease our operations.

Management is trying to alleviate the going concern risk through the following sources:

Equity financing to support our working capital;

Financial support and credit guarantee commitments from our related parties.

However, there is no guarantee that the substantial

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Operating Activities

Net cash used in operating activities for the years ended June 30,

2025 was approximately $9.3 million and was mainly comprised of the net loss of approximately $23.4 million, non-cash item of gain

in change in fair value of derivative liabilities of approximately $1.8 million, increase in accounts receivable of approximately $1.6

million due to additional sales to new service partnership with Reveillon Group Limited but not yet collected, increase of other receivable

and other assets of approximately $7.0 million which mainly includes approximately $3.6 million prepayment to certain vendors for technical

and maintenance service and approximately $5.7 million of collaboration deposit made to Credilab Sdn.

(“CLSB”), decrease

in customer deposits of approximately $75,000, as we recognized member service revenue in the current period from certain merchant prepayments

made in the prior period, and decrease in contract liabilities of approximately $0.2 million, primarily as a result of increased revenue

recognized from the ZCITY reward program due to a higher volume of customer reward redemptions, offset by non-cash items of depreciation,

amortization, allowance for credit losses, stock-based compensation, long-live assets impairment and unrealized loss on marketable securities

amounted to approximately $21.6 million, decrease of prepayment of approximately $0.1 million due to the utilization of prior-period prepayments

for inventory purchases, and (iii) increase of approximately $2.9 million in other payables and accrued liabilities as we made approximately

$2.7 million provision related to settlement of cash compensation requested by V Gallant Sdn.

pursuant to the Service Agreement dated

October 29, 2024, as supplemented on March 28, 2025, to reflect the decline in our share price.

Net cash used in operating activities for the

year ended June 30, 2024 was approximately $4.7 million and was mainly comprised of the net loss of approximately $6.6 million ,

non-cash other incomes of approximately $1.0 million from software developing service related to VCI’s project, and approximately

$0.2 million from disposal of Foodlink and its subsidiaries as mentioned above in other expense, net, increase

of prepayments of approximately $0.1 million as our vendors required us to make deposit to secure the purchase, decrease of customer deposit

of approximately $0.1 million as we realized more membership subscription revenue from the customer deposit collected from prior period,

and decrease of other payables and accrued liabilities of approximately $0.1 million as made timely payment to our service providers,

offset by non-cash items of depreciation, amortization, allowance for credit losses, stock-based compensation and unrealized loss on marketable

securities amounted to approximately $2.4 million, decrease of inventories of approximately $0.3 million as we reduced our purchase and

intended to maintain a more effective inventory level, decrease of approximately $0.4 million in other receivables and other current assets

is attributed to the utilization of prepaid information technology and insurance expenses from previous periods in the current period,

and increase of approximately $0.3 million in accounts payable as we made more purchases on account.

used in operating activities for the years ended June 30, 2023 was approximately $9.6 million and were mainly comprised of the net loss

of approximately $11.7 million, increase of prepayments of approximately $0.1 million as our vendors required us to make deposit

to secure the purchase, increase of accounts receivable of approximately $0.2 million as a result of offering credit terms to our corporate

customers engaged in the sales of nutrition products, and food and beverage products, increase in inventory of approximately $0.2 million

as we increase our inventory level on June 30, 2023 to meet with the demand of our product, and increase of approximately $0.4 million

in other receivables and other current assets as we prepaid IT maintenance fee to a third party service provider, offset by amortization

of debt discount of approximately $1.3 million, stock-based compensation of approximately $0.8 million, increase of approximately $0.1

million in customer deposits as we incurred deferred revenue related to member subscription revenue for the remaining subscribed period

as of June 30, 2023, increase of approximately $0.1 million in contract liability as we deferred more revenue due to increase of

our customer’s redemption rate in spending related reward point, and increase of approximately $0.5 million in other payables

and accrued liabilities mainly related to the accrued professional expenses.

year ended June 30, 2024 was approximately $4.7 million and was mainly comprised of the net loss of approximately $6.6 million, non-cash

other incomes of approximately $1.0 million from software developing service related to VCI’s project, and approximately $0.2 million

from disposal of Foodlink and its subsidiaries as mentioned above in other expense, net, increase of prepayments of approximately

$0.1 million as our vendors required us to make deposit to secure the purchase, decrease of customer deposit of approximately $0.1 million

as we realized more membership subscription revenue from the customer deposit collected from prior period, and decrease of other payables

and accrued liabilities of approximately $0.1 million as made timely payment to our service providers, offset by non-cash items of depreciation,

amortization, allowance for credit losses, stock-based compensation and unrealized loss on marketable securities amounted to approximately

$2.4 million, decrease of inventories of approximately $0.3 million as we reduced our purchase and intended to maintain a more effective

inventory level, decrease of approximately $0.4 million in other receivables and other current assets is attributed to the utilization

of prepaid information technology and insurance expenses from previous periods in the current period, and increase of approximately

$0.3 million in accounts payable as we made more purchases on account.

Investing Activities

Net cash used in investing activities for the year ended June 30, 2025

was approximately $5.9 million which mainly due to remittance of approximately $5.7 million to CLSB as a collaboration deposit to support

CLSB’s credit service activities for the Portfolio Clients, and approximately $0.2 million prepayment of purchase consideration

for acquisition of Tien Ming Distribution Sdn Bhd.

Net cash used in investing activities for the

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disposal of Foodlink and its subsidiaries.

used in investing activities for the year ended June 30, 2023 was approximately $61,000, which mainly due to purchase of equipment of

approximately $87,000 for our operations used, and offset with proceeds of approximately $26,000 received from disposal of our office

Financing Activities

Net cash provided financing activities the years

ended June 30, 2025 was approximately $15.4 million, which mainly comprised of approximately $15.4 million net proceeds received from

issuance of common stock through market offering, subscription agreement and share purchase agreement, approximately $64,000 proceed received

from exercised of warrants, and loan proceed of approximately $51,000, offset by payments of insurance loan and related party loan of

approximately $54,000.

Net cash provided financing activities for the

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stock related to the Marketing Offering, and approximately $16,000 capital contribution.

provided by financing activities for the year ended June 30, 2023 was approximately $12.7 million, which mainly comprised of proceeds

received from the issuance of convertible notes to third parties of approximately $7.7 million, proceeds received from our initial public

offering of approximately $8.2 million, and proceeds received from third parties loans of approximately $0.6 million, offset by repayment

to related parties, third parties loans, and insurance loan of approximately $3.8 million, repayment of senior note of $65,000, and $15,000

payment of deferred offering costs.

Off-Balance Sheet Arrangements

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Accounts receivable encompass amounts due from sales of healthcare products

on our ZCITY platform, sublicensing revenue and sales of food and beverage products.

Starting from July 1, 2023, we adopted ASU No.2016-13

“Financial Instruments – Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments” (“ASC

We used a modified retrospective approach, and the adoption does not have an impact on our unaudited condensed consolidated

financial statements.

Management also periodically evaluates individual customer’s financial condition, credit history and the current

economic conditions to make adjustments in the allowance when it is considered necessary.

Account balances are charged off against the

allowance when all collection efforts have been exhausted, and recovery potential is deemed remote.

on our ZCITY platform.

Management also periodically evaluates individual customer’s financial condition, credit history and the

current economic conditions to make adjustments in the allowance when it is considered necessary.

Account balances are charged off against

the allowance when all collection efforts have been exhausted, and recovery potential is deemed remote.

Our management reviews historical

accounts receivable collection rates across all aging brackets and has made 100% provision of credit loss for customer balances aged above

120 days for sales of healthcare products on our ZCITY platform and 100% provision for customer balances aged above 60 days for sublicensing

revenue and sales of food and beverage products.

Our management continuously assesses the reasonableness of the credit loss allowance

policy and updates it as needed.

As of June 30, 2024 and 2023, we recorded $1,100 and $214 of provision for estimated credit losses,

respectively.

120 days for sales of healthcare products on our ZCITY platform.

Our management continuously assesses the reasonableness of the credit

loss allowance policy and updates it as needed.

As of June 30, 2025 and 2024, we recorded $9,924 and $1,100 of provision for estimated

credit losses, respectively.

Our inventories are recorded at the lower of cost

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and health care products.

For the years ended June 30, 2024 and 2023, $483 and $0 write down for inventories were recorded, respectively.

Other receivables and other current assets, net

For the years ended June 30, 2025 and 2024, $0 and $483 write-downs for estimated obsolescence or unmarketable

inventories were recorded.

Other receivables and other current assets,

Other receivables and other current assets consist

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and other deposits.

Starting from July 1, 2023 , we had adopted ASC Topic 326 on our other receivables

using the modified retrospective approach.

The new credit loss guidance replaces the old model for measuring the allowance for credit

losses with a model that is based on the expected losses rather than incurred losses.

Under the new accounting guidance, we measure credit

losses on its other receivables using the current expected credit loss model under ASC 326.

As of June 30, 2024 and 2023, we have provided

allowance for credit loss of $212,759 and $0, respectively.

Prepayments and deposits are mainly cash deposited

or advanced to suppliers for future inventory purchases.

This amount is refundable and bears no interest.

For any prepayments determined

by management that such advances will not be in receipt of inventories, services or refundable, we will recognize an allowance account

to reserve such balances.

Management reviews our prepayments on a regular basis to determine if the allowance is adequate, and adjusts

the allowance when necessary.

Delinquent account balances are written-off against allowance for doubtful accounts after management has

determined that the likelihood of collection is not probable.

Our management continues to evaluate the reasonableness of the valuation

allowance policy and updates it if necessary.

No allowance of prepayments was recorded as of June 30, 2024 and June 30, 2023.

Starting from July 1, 2023, we had adopted ASC Topic 326 on our other receivables using the modified retrospective

The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based

on the expected losses rather than incurred losses.

Under the new accounting guidance, we measure credit losses on its other receivables

using the current expected credit loss model under ASC 326.

As of June 30, 2025 and 2024, we have provided allowance for credit loss of

$1,078,353 and $212,758, respectively.

Impairment for long-lived assets

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of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market

No impairment for long-lived assets were recorded as of June 30, 2024 and 2023.

$19,517,303 and $0 impairment for long-lived assets were recorded as of June 30, 2025 and 2024, respectively.

Investment in marketable

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of comprehensive income.

For the years ended June 30, 2024 and 2023, we incurred unrealized holding loss on marketable securities amounted

to approximately $828,367 and $0, respectively.

For the years ended June 30, 2025 and 2024, we recorded an unrealized holding loss on marketable securities of

approximately $0.2 million and 0.8 million, respectively.

Revenue recognition

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- Performance obligations satisfied

Our ZCITY reward loyalty program allows members

to earn points on purchases that can be redeemed for rewards that include discounts on future purchases.

When members purchase our product

or make purchase with our participated vendor through ZCITY, we allocate the transaction price between the product or service, and

the reward points earned based on the relative stand-alone selling prices and expected point redemption.

The portion allocated to the

reward points is initially recorded as contract liability and subsequently recognized as revenue upon redemption or expiration.

Our TADAA Technologies reward loyalty program allows members to earn

points on purchases that can be redeemed for rewards that include discounts on future purchases.

When members purchase our product or

make purchase with our participated vendor through TADAA Technologies, we allocate the transaction price between the product or service,

and the reward points earned based on the relative stand-alone selling prices and expected point redemption.

The portion allocated to

the reward points is initially recorded as contract liability and subsequently recognized as revenue upon redemption or expiration.

The two primary estimates utilized to record the

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as of the end of the reporting period.

Customized Software development Service revenue

- Performance obligations satisfied

We recognize revenue from customized software

development services over time using the cost-to-cost input method to measure progress toward satisfaction of our performance obligations.

This approach requires us to make critical estimates and judgments, including determining total estimated costs to complete each contract

and assessing progress toward completion.

Changes in project scope, complexity, or estimated costs may significantly impact the timing

and amount of revenue we recognize.

We also evaluate whether we have an enforceable right to payment for performance completed to date

and whether control is transferred continuously to the customer.

Any revisions to total estimated contract costs or anticipated losses

are recorded in the period in which the changes are identified.

Deferred taxes are accounted for using the asset

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being presumed to occur.

The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized

on examination.

The amount recognized is the largest amount of tax benefit that is greater than 50% likely to be realized on

For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.

Stock-based compensation

We recognize compensation costs resulting from

the issuance of stock-based awards to third party consultant and former director as an expense in the statements of operations over the

requisite service period based on a measurement of fair value for each stock-based award.

The fair value of each warrants granted are

estimated as of the grant date using the Black-Scholes-Merton option-pricing model while the fair value of each common stock granted are

estimated using the Company’s closing stock price on the grant date.

The fair value is amortized as compensation cost on a straight-line

basis over the requisite service period of the awards.

The Black-Scholes-Merton option-pricing model includes various assumptions, including

the fair market value of the common stock of the Company, expected life of stock options, the expected volatility and the expected risk-free

interest rate, among others.

These assumptions reflect the Company’s best estimates, but they involve inherent uncertainties based

on market conditions generally outside the control of the Company.

The fair value of the stock-based compensation which included warrants

and common stock issued were estimated to be $11,111 and $819,332 for the years ended June 30, 2024 and 2023, respectively.

We account for stock-based compensation awards to officers in accordance

with FASB ASC Topic 718, “Compensation – Stock Compensation”, which requires that stock-based payment transactions with

employees be measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the

requisite service period.

In June 2024, we executed executive employment agreements (“Employment Agreements”) with three individuals,

appointing them as the Company’s executive officers.

Under the terms of the Employment Agreements, each executive officer is entitled

to receive a predetermined monetary value of the Company’s common stock as annual compensation for the first year, with stock compensation

for subsequent years contingent upon performance.

The stock compensation is prorated on a monthly basis and is subject to the restrictions

of Securities Act Rule 144.

The fair value of the stock-based compensation which included common stock issued were equivalent to the predetermined

monetary value.

For the years ended June 30, 2025 and 2024, we have incurred stock-based compensation from our officer amounted to approximately

$0.3 million and $0.1 million, respectively based on the vesting schedule from the Employment Agreements.

Convertible notes

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expense, over the life of the debt.

We account for warrants as equity-classified instruments

in accordance with ASC 480 and ASC 815.

The fair value of each warrant granted is estimated as of the date of grant using the Black-Scholes-Merton

option-pricing model.

The fair value is amortized as compensation cost on a straight-line basis over the requisite service period of the

The Black-Scholes-Merton option-pricing model includes various assumptions, including the fair market value of our common stock,

expected life of stock options, the expected volatility and the expected risk-free interest rate, among others.

These assumptions reflect

our best estimates, but they involve inherent uncertainties based on market conditions generally outside our control.

Based on the above

assumption, the fair value of the warrants issued during the years ended June 30, 2024 and 2023 were estimated to be $0 and $175,349,

respectively.

- Fair value of Pre-Funded

For the year ended June 30, 2024, 14,000,000 Pre-Funded

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and recorded as a component of additional paid in capital.

Recent Accounting Pronouncements

See Note 2 of the notes to the consolidated financial

statements included elsewhere in this report for a discussion of recently issued accounting standards.

and Qualitative Disclosures About Market Risk.

- Fair value of Alumni Capital

We account for the purchase warrants issued to

Alumni Capital LP (“Alumni Capital”) as liabilities, which are remeasured at fair value at each reporting period, with changes

in fair value recognized in our consolidated statements of operations.

The fair value of these warrants is estimated using the Black-Scholes

option pricing model, which requires the use of significant judgment and assumptions, including expected stock price volatility, risk-free

interest rate, expected life of the warrant, and the market price and exercise price of our common stock.

These assumptions are highly

subjective and inherently uncertain, and changes in any of these inputs can materially affect the estimated fair value of the warrant

The fair value of the warrants issued to Alumni

Capital which was determined on grant dates by using the Black Scholes model using the following assumptions:

(1) expected volatility

of 160.20% to 171.88%, (2) risk-free interest rate of 3.72% to 4.37%, (3) expected life of 2.4 years to 2.8 years,

(4) exercise price of $2.22 to $5.15 and (5) stock price of $1.62 to $19.50 on grant date, the date of which the warrants

Based on above assumption, the fair value of the warrants was estimated to be $2,450,227.

The fair value of the warrants issued to Alumni

Capital which was determined on June 30, 2025 by using the Black Scholes model using the following assumptions:

(1) expected volatility

of 162.92% to 167.27%, (2) risk-free interest rate of 3.71%, (3) expected life of 2.3 years, (4) exercise

price of $1.20 to $2.05 and (5) stock price of $1.10 on June 30, 2025.

Based on above assumption, the fair value of the

warrants were estimated to be $383,885.

Quantitative and Qualitative

Disclosures About Market Risk.

The Company is a smaller reporting company as

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

What changed 10-K

Item 7. Management’s Discussion and Analysis