Quarterly Report for Quarter Ending June 30, 2025 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion and analysis should be read in conjunction with our consolidated financial statements, included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future. Such discussion represents only the best present assessment of our management. This information should also be read in conjunction with our audited historical consolidated financial statements which are included in our Company's Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission on April 16, 2025.

Overview

Onfolio Holdings Inc. acquires controlling interests in and actively manages online businesses that we believe (i) operate in sectors with long-term growth opportunities, (ii) have positive and stable cash flows, (iii) face minimal threats of technological or competitive obsolescence and (iv) can be managed by our existing team or have strong management teams largely in place. Through the acquisition and growth of a diversified group of websites with these characteristics, we believe we offer investors in our shares an opportunity to diversify their own portfolio risk.

Onfolio Holdings Inc. was incorporated on July 20, 2020 under the laws of Delaware to acquire and develop high-growth and profitable websites. Unless the context otherwise requires, all references to "our Company," "we," "our" or "us" and other similar terms means Onfolio Holdings Inc., a Delaware corporation, and our wholly- and majority-owned subsidiaries.

The second quarter of 2025 delivered another period of topline growth, gross profit gains, and further improvement in operating performance. Revenue reached $3.1 million, up from $1.7 million in the same quarter last year-an 82% increase. The increase is primarily due to revenue from our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024 and our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024. This was also the first quarter in our history where every month surpassed $1 million in revenue. We started the quarter particularly strong in April, achieving a fully profitable month.

Loss from operations was $(507,000) for the quarter, compared with $(606,000) in Q2 2024 and $(786,000) in Q1 2025. Of this amount, $301,000 was amortization from acquisitions, $25,000 was stock-based compensation, and approximately $150,000 related to one-time expenses from the 2023 re-audit and the Eastern Standard acquisition audit. Excluding these non-recurring items-which will not appear in Q3 or in future years-the quarterly net loss would have been significantly lower.

Operationally, we continued to reduce costs across both the portfolio and the parent company. We also launched Pace Generative LLC in May, a venture we believe has the potential to contribute meaningful revenue and profit to our Company going forward.

Several key properties continued to generate organic revenue growth in Q2, although momentum eased slightly in June due to normal summer seasonality. We believe this growth trajectory positions us closer to achieving consistent monthly profitability.

Our acquisition pipeline remains strong, and we are actively pursuing new transactions. Management remains committed to disciplined execution of our strategy, further improving financial performance, and completing accretive acquisitions to drive long-term shareholder value.

Emerging Growth Company

We qualify as an "emerging growth company" under the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:

	·	have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
	·	comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
	·	submit certain executive compensation matters to stockholder advisory votes, such as "say-on-pay" and "say-on-frequency;"
	·	disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer's compensation to median employee compensation.

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In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.

We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year following the fifth anniversary of our initial public offering, (ii) the last day of the first fiscal year in which our total annual gross revenues are $1.235 billion or more, (ii) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iv) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.

Principal Factors Affecting Our Financial Performance

Our operating results are primarily affected by the following factors at a portfolio company level:

	·	our ability to acquire new customers or retain existing customers and grow revenue;
	·	our ability to offer competitive product pricing and control expenses;
	·	our ability to broaden product offerings;
	·	industry demand and competition;
	·	our ability to leverage technology and use and develop efficient processes;
	·	our ability to attract and retain talented employees;
	·	our ability to identify and acquire companies at reasonable prices and terms;
	·	our ability to reduce and control corporate overhead; and
	·	Our market position and market conditions, including the effects of government policies, tariffs and trade barriers.

Results of Operations

Three Months Ended June 30, 2025 compared to the Three Months Ended June 30, 2024

The Company reported a net loss of $534,439 for the three months ended June 30, 2025 compared to a net loss of $629,043 for the three months ended June 30, 2024. The components of the decrease in net loss for the current period are as follows:

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Revenues

		For the Quarter Ended June 30,								$ Change from prior				% Change from prior
		2025				2024				Year				year
Revenue, services		$	2,062,603			$	993,166			$	1,069,437				108	%
Revenue, product sales			1,085,606				733,433				352,173				48	%
Total Revenue		$	3,148,209			$	1,726,599				1,421,610				82	%

Revenue increased by $1,421,610, or 82% for the three months ended June 30, 2025 compared to 2024. The increase is primarily due to revenue from our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024, which increased revenue by approximately $1,250,500 and our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024, which increased revenue by approximately $38,800. In addition, our digital product sales increased by approximately $480,000 under our Proofread anywhere subsidiary as a result of an increase in business performance.

Cost of Revenue

		For the Quarter Ended June 30,								$ Change from				% Change from
		2025				2024				prior year				prior year
Cost of revenue, services		$	1,074,065			$	557,518			$	516,547				93	%
Cost of revenue, product sales			135,867				193,650				(57,783	)			(30	)%
Total Cost of Revenue			1,209,932				751,168				458,764				61	%

Cost of revenue increased by $458,764, or 61% due to the Company's recent acquisitions which increased cost of service revenue, partially offset by a reduction in cost of product sales revenue. This reduction was driven by a strategic shift in the Company's marketing approach for certain subsidiaries, emphasizing advertising (recorded under operating expenses), and reducing reliance on affiliate sales (recorded under cost of revenue). Lower product sales from the Mighty Deals and Vital Reaction subsidiaries also contributed to the offset. The Company's gross profit margins decreased slightly in the current period compared to the prior period. The components most significant to the Company's cost of revenue are the costs of labor for service fulfillment, content creation, website hosting and maintenance costs and the costs of acquiring new inventory products for physical product sales.

Operating Expenses

Selling, General and Administrative

General and Administrative expenses increased by $715,141, or 53% during the three months ended June 30, 2025 compared to 2024. The increase was primarily due to an increase in advertising and marketing costs of $391,000, increase in contractor and compensation costs of $56,000, increase in other general and administrative costs of $93,000, including travel and merchant fees, and an increase in amortization expenses of $176,000 associated with the acquired intangible assets, Eastern Standard and DDS Rank, not present in the comparable period.

Our general and administrative expenses consist primarily of consulting related expenses paid to contractors, stock-based compensation, advertising and marketing costs, and other expenses. In the near future, we expect our general and administrative expenses to continue to increase to support business growth. Over the long term, we expect general and administrative expenses to decrease as a percentage of revenue.

Professional Fees and Acquisition Costs

Professional fees increased by $124,486, or 56% during the three months ended June 30, 2025 compared to 2024 primarily due to increased legal and accounting costs associated with the Company's compliance requirements as a public company. The Company also incurred $32,263 in acquisition costs during the three months ended June 30, 2025 compared to $8,946 during 2024, which included due diligence, audit, legal and other professional fees related to acquisitions and potential acquisitions. We expect acquisition costs to remain significant as we continue to grow based on acquisitions.

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Other Income and expense

Total other expense was $27,788 during the three months ended June 30, 2025, compared to other expense of $22,618 during 2024. The increase in other expense was driven by an increase in interest expense from increased loan balances.

Business Segment Results of Operations

We operate in two business segments: Business to Business ("B2B") and Business to Consumers ("B2C"). We organize our business segments based on the nature of products and services offered, and the economic characteristics of each segment. Following is a brief description of the activities of our business segments:

Selected Financial Data by Business Segment

Net sales and operating profit of the Company's business segments exclude intersegment sales, cost of sales and profit as these activities are eliminated in consolidation and thus are not included in management's evaluation of performance of each segment. Sales, cost of sales and operating profit for each of our business segments were as follows:

		For the Three Months ended June 30,
		2025				2024
Revenue
B2B		$	1,974,771			$	915,475
B2C			1,173,438				811,124
Total revenue		$	3,148,209			$	1,726,599
Cost of Sales
B2B		$	1,052,778			$	550,269
B2C			157,154				200,899
Total Cost of Sales		$	1,209,932			$	751,168
Operating income (loss)
B2B		$	70,173			$	74,463
B2C			150,261				62,106
Total business segment operating income (loss)			220,434				136,569
Unallocated items			(726,957	)			(742,994	)
Total consolidated operating income (loss)		$	(506,523	)		$	(606,425	)

Management evaluates performance on our contracts by focusing on net sales and operating profit and not by type or amount of operating expense. Consequently, our discussion of business segment performance focuses on net sales and operating profit, consistent with our approach for managing the business. This approach is consistent throughout the life cycle of our contracts, as management assesses the bidding of each contract by focusing on net sales and operating profit and monitors performance on our contracts in a similar manner through their completion.

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B2B

Our B2B segment includes the results of operations of Eastern Standard, RevenueZen, DDS Rank, SEO Butler, Contentellect, and DealPipe. These entities share similar characteristics such as customers being businesses and being primarily service-related revenue.

B2B revenue increased by $1,059,296 or 116% during the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase is primarily due to revenue from our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024, which increased revenue by approximately $38,800, and our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024, which increased revenue by approximately $1,250,500.

B2B total operating income increased by $561,077 or 193% during the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase was a result of the increased revenue and gross profit offset by the increase in intangible asset amortization for the newly acquired businesses in the year ended 2024.

B2C

Our B2C segment includes the results of operations of Proofread Anywhere, Onfolio Assets, Mighty Deals, and Vital Reaction. These entities share characteristics such as the end customers being individual consumers, and sales being more focused on product sales, including digital sales.

B2C revenue increased by $362,314 or 45% during the three months June 30, 2025 compared to the three months ended June 30, 2024. The increase is primarily due to an increase in digital product sales within the Company's Proofread Anywhere subsidiary.

B2C incurred total operating income of $150,261 during the three months ended June 30, 2025 compared to an operating income of $62,106 during the three months ended June 30, 2024, primarily due to the increase in sales from the Proofread Anywhere subsidiary.

Six Months Ended June 30, 2025 compared to the Six Months Ended June 30, 2024

The Company reported a net loss of $1,340,867 for the six months ended June 30, 2025 compared to a net loss of $1,106,869 for the six months ended June 30, 2024. The components of the increase in net loss for the current period are as follows:

Revenues

		For the Period Ended June 30,								$ Change from prior				% Change from prior
		2025				2024				Year				year
Revenue, services		$	3,859,198			$	1,716,717			$	2,142,481				125	%
Revenue, product sales			2,100,954				1,596,784				504,170				32	%
Total Revenue		$	5,960,152			$	3,313,501				2,646,651				80	%

Revenue increased by $2,646,651, or 80% for the six months ended June 30, 2025 compared to 2024. The increase is primarily due to revenue from our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024, which increased revenue by approximately $2,168,000 and our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024, which increased revenue by approximately $91,300. In addition, our digital product sales increased by approximately $804,000 under our Proofread anywhere subsidiary as a result of a change in business marketing strategy.

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Cost of Revenue

		For the Period Ended June 30,								$ Change from				% Change from
		2025				2024				prior year				prior year
Cost of revenue, services		$	2,086,349			$	924,224			$	1,162,125				126	%
Cost of revenue, product sales			228,406				409,510				(181,104	)			(44	)%
Total Cost of Revenue			2,314,755				1,333,734				981,021				74	%

Cost of revenue increased by $981,021, or 94% due to the Company's recent acquisitions which increased cost of service revenue, partially offset by a reduction in cost of product sales revenue. This reduction was driven by a strategic shift in the Company's marketing approach for certain subsidiaries, emphasizing advertising (recorded under operating expenses), and reducing reliance on affiliate sales (recorded under cost of revenue). Lower product sales from the Mighty Deals and Vital Reaction subsidiaries also contributed to the offset. The Company's gross profit margins decreased slightly in the current period compared to the prior period. The components most significant to the Company's cost of revenue are the costs of labor for service fulfillment, content creation, website hosting and maintenance costs and the costs of acquiring new inventory products for physical product sales.

Operating Expenses

Selling, General and Administrative

General and Administrative expenses increased by $1,751,303, or 69% during the six months ended June 30, 2025 compared to 2024. The increase was primarily due to an increase in advertising and marketing costs of $718,000, an increase in stock-based compensation expense of $254,000, increase in contractor and compensation costs of $142,000, increase in other general and administrative costs of $198,000, including travel and merchant fees, and an increase in amortization expenses of $352,000 associated with the acquired intangible assets not present in the comparable period.

Our general and administrative expenses consist primarily of consulting related expenses paid to contractors, stock-based compensation, advertising and marketing costs, and other expenses. In the near future, we expect our general and administrative expenses to continue to increase to support business growth. Over the long term, we expect general and administrative expenses to decrease as a percentage of revenue.

Professional Fees and Acquisition Costs

Professional fees increased by $182,201, or 45% during the six months ended June 30, 2025 compared to 2024 primarily due to increased legal and accounting costs associated with the Company's compliance requirements as a public company. The Company also incurred $65,673 in acquisition costs during the six months ended June 30, 2025 compared to $103,287 during 2024, which included due diligence, audit, legal and other professional fees related to acquisitions and potential acquisitions. We expect acquisition costs to remain significant as we continue to grow based on acquisitions.

Other Income and expense

Total other expense was $66,193 during the six months ended June 30, 2025, compared to other expense of $45,065 during 2024. The increase in other expense was driven by an increase in interest expense from increased loan balances.

Business Segment Results of Operations

We operate in two business segments: Business to Business ("B2B") and Business to Consumers ("B2C"). We organize our business segments based on the nature of products and services offered, and the economic characteristics of each segment. Following is a brief description of the activities of our business segments:

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Selected Financial Data by Business Segment

Net sales and operating profit of the Company's business segments exclude intersegment sales, cost of sales and profit as these activities are eliminated in consolidation and thus are not included in management's evaluation of performance of each segment. Sales, cost of sales and operating profit for each of our business segments were as follows:

		For the Six Months ended June,
		2025				2024
Revenue
B2B		$	3,668,685			$	1,593,597
B2C			2,291,467				1,719,904
Total revenue		$	5,960,152			$	3,313,501
Cost of Sales
B2B		$	2,035,130			$	911,199
B2C			279,625				422,535
Total Cost of Sales		$	2,314,755			$	1,333,734
Operating income (loss)
B2B		$	19,628			$	201,688
B2C			378,419				215,865
Total business segment operating income (loss)			398,047				417,553
Unallocated items			(1,690,111	)			(1,479,357	)
Total consolidated operating income (loss)		$	(1,292,064	)		$	(1,061,804	)

Management evaluates performance on our contracts by focusing on net sales and operating profit and not by type or amount of operating expense. Consequently, our discussion of business segment performance focuses on net sales and operating profit, consistent with our approach for managing the business. This approach is consistent throughout the life cycle of our contracts, as management assesses the bidding of each contract by focusing on net sales and operating profit and monitors performance on our contracts in a similar manner through their completion.

B2B

Our B2B segment includes the results of operations of Eastern Standard, RevenueZen, DDS Rank, SEO Butler, Contentellect, and DealPipe. These entities share similar characteristics such as customers being businesses and being primarily service-related revenue.

B2B revenue increased by $2,075,088 or 130% during the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The increase is primarily due to revenue from our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024, which increased revenue by approximately $91,300, and our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024, which increased revenue by approximately $2,168,000.

B2B total operating income decreased by $182,060 or 90% during the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The decrease was a result of the increased revenue and gross profit offset by the increase in intangible asset amortization for the newly acquired businesses in the year ended 2024.

B2C

Our B2C segment includes the results of operations of Proofread Anywhere, Onfolio Assets, Mighty Deals, and Vital Reaction. These entities share characteristics such as the end customers being individual consumers, and sales being more focused on product sales, including digital sales.

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B2C revenue increased by $571,563 or 33% during the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The increase is primarily due to an increase in digital product sales within the Company's Proofread Anywhere subsidiary.

B2C incurred total operating income of $378,419 during the six months ended June 30, 2025 compared to an operating income of $215,865 during the six months ended June 30, 2024, primarily due to the increase in sales from the Proofread Anywhere subsidiary.

Liquidity and Capital Resources

Our primary source of operating cash inflows are payments from portfolio companies. In addition, the Company has raised approximately $1,500,000 pursuant to a private offerings of Series A preferred stock through June 30, 2025, $976,800 in notes payable and repaid $2,164,498 on its acquisition notes.

Our Company's recurring losses from operations and negative cash flows from operations and our need to raise additional funding to finance our operations raise substantial doubt about our ability to continue as a going concern. Accordingly, management and our auditor have concluded that substantial doubt exists regarding our ability to continue as a going concern. Our audited financial statements contained in our Company's Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission on April 16, 2025 were prepared on a going concern basis, and contemplated the realization of assets and satisfaction of liabilities in the ordinary course of business. We believe that our cash and cash equivalents as of June 30, 2025, and the future operating cash flows of the entity may not provide adequate resources to fund ongoing cash requirements for the next twelve months. If sources of liquidity are not available or if we cannot generate sufficient cash flow from operations during the next twelve months, we may be required to obtain additional sources of funds through additional operational improvements, capital market transactions, asset sales or financing from third parties, a combination thereof or otherwise. We cannot provide assurance that these additional sources of funds will be available or, if available, would have reasonable terms. If we are unable to obtain sufficient funding, our business, prospects, financial condition and results of operations will be materially and adversely affected, and we may be unable to continue as a going concern.

Cash used in operating activities

Net cash used in operating activities was $575,164 and $763,747 for the six months ended June 30, 2025 and 2024, respectively. The decrease was primarily from the increase in revenues and decreased general and administrative costs as the Company expanded its operations through its business acquisitions in the past year.

Cash used in investing activities

Net cash used in investing activities was $0 and $304,000 for the six months ended June 30, 2025 and 2024, respectively. The cash used in investing activities was primarily for the purchase of businesses in the prior period and additional cost method investments.

Cash provided by financing activities

Cash flows provided by financing activities was $585,097 for the six months ended June 30, 2025 compared to cash provided by financing activities of $415,749 during the six months ended June 30, 2024. During the 2025 period, we received $865,965 in proceeds from sales of Series A preferred stock and we paid $201,848 in dividends to preferred stockholders, made payments totaling $266,295 on notes payable, made payments totaling $133,845 related to contingent consideration and made distributions totaling $37,680 to our non-controlling interest holders. During the 2024 period, we received $10,000 in proceeds from sales of Series A preferred stock, $417,900 in proceeds from notes payable, and $200,000 in proceeds from related party notes payables, made payments of $151,035 in dividends to preferred stockholders, made payments totaling $56,516 on notes payable, made payments of $1,000 on related party notes payable, and $3,600 in distribution to non-controlling interest holders.

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Critical Accounting Policies

The following are the Company's critical accounting policies:

Investment in Unconsolidated Entities - Equity and Cost Method Investments

We account for our interests in entities in which we are able to exercise significant influence over operating and financial policies, generally 50% or less ownership interest, under the equity method of accounting. In such cases, our original investments are recorded at cost and adjusted for our share of earnings, losses and distributions. We account for our interests in entities where we have virtually no influence over operating and financial policies under the cost method of accounting. In such cases, our original investments are recorded at cost and any distributions received are recorded as income. Our investments in OnFolio JV I, LLC ("JV I"), OnFolio JVII, LLC ("JVII") and OnFolio JVIII, LLC ("JVIII") are accounted for under the cost method. All investments are subject to our impairment review policy.

The current investment in unconsolidated affiliates accounted for under the equity method consists of a 35.8% interest in OnFolio JV IV, LLC ("JV IV"), which is involved in the acquisition, development and operation of websites to produce adverting revenue.

Variable Interest Entities

Variable interest entities ("VIEs") are consolidated when the investor is the primary beneficiary. A primary beneficiary is the variable interest holder in a VIE with both the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and the obligation to absorb losses, or the right to receive benefits that could potentially be significant to the VIE. Management concluded that the joint ventures do not qualify as variable interest entities under the requirements of ASC 810. The Company accounts for its investments in the joint ventures under either the cost or equity method based on the equity ownership in each entity.

Revenue Recognition

The Company primarily earns revenue through website management, digital services, advertising and content placement on its websites, product sales, and digital product sales. Management services revenue is earned and recognized on a monthly basis as the services are provided. Advertising and content revenue is earned and recognized once the content is presented on the Company's sites in accordance with the customer requirements. Product sales are recognized at the time the product is shipped to the customer. In certain circumstances, products are shipped directly by a supplier to the end customer at the Company's request. The Company determined that it is the primary obligor in these contracts due to being responsible for fulfilling the customer contract, establishing pricing with the customer, and taking on credit risk from the customer. The Company recognizes revenue from these contracts with customers on a gross basis. Digital product sales represent electronic content that is transferred to the customer at time of purchase. The Company also earns revenue from online course subscriptions that may have monthly or annual subscriptions. In circumstances when a customer purchases an annual subscription upfront, the Company defers the revenue until the performance obligation has been satisfied.

Revenue is recognized based on the following five step model:

	-	Identification of the contract with a customer
	-	Identification of the performance obligations in the contract
	-	Determination of the transaction price
	-	Allocation of the transaction price to the performance obligations in the contract
	-	Recognition of revenue when, or as, the Company satisfies a performance obligation

The Company amortizes acquired definite-lived intangible assets over their estimated useful lives. Other indefinite-lived intangible assets are not amortized but subject to annual impairment tests.

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Long-lived Assets

Property and equipment are stated on the basis of historical cost less accumulated depreciation. Depreciation is provided using the straight-line method over the estimated useful lives of the assets. Major renewals and improvements are capitalized, while minor replacements, maintenance and repairs are charged to current operations.

In accordance with ASC 360 "Property Plant and Equipment," the Company reviews the carrying value of intangibles subject to amortization and long-lived assets for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Recoverability of long-lived assets is measured by comparison of its carrying amount to the undiscounted cash flows that the asset or asset group is expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the property, if any, exceeds its fair market value.

Off-balance sheet arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Contractual commitments

BWPS Business Acquisition: The Company may be required to pay up to $60,000 to Hoang Huu Thinh, contingent upon the BWPS business meeting certain monthly gross revenue targets within three years from the closing date. No earn-out payments have been made as of June 30, 2025. (See Note 13 for further details.)

RevenueZen Acquisition: The Company has determined the final amount obligated to pay to the sellers of RevenueZen, contingent upon the business achieving a specified gross profit threshold within one year to be $680,662. On February 28, 2025, the Company and the RevenueZen sellers agreed to the final earn-out amount to be $682,000 and modified the payment terms to be paid with a cash payment of $72,000, $100,000 to be paid through profit sharing by using 30% of Net Operating Income, $100,000 in value for $79,240 stock options to purchase shares of common stock, $70,000 in Series A preferred stock, and $340,000 in a promissory note. The promissory note, has a term of 60 months and accrues interest at 19%. The stock options have an exercise price of $1.34, have a term of 10 years, and are vested immediately. As of June 30, 2025, the Company estimated the remaining obligations owed under the revenue share obligation to be $85,975,

First Page Acquisition: The Company agreed to pay a revenue share amount equal to 18% of gross revenues for the acquired customers for 3 years following the acquisition date. As of June 30, 2025, the Company estimated the remaining obligations owed under the revenue share provisions to be $121,056 resulting in a change in the fair value of the continent consideration of $72,050.