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

Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our Company's financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in the report. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors. See "Cautionary Note Concerning Forward-Looking Statements" on page 9.

Unless otherwise noted, all currency figures quoted as "U.S. dollars", "dollars" or "$" refer to the legal currency of the United States. Throughout this report, assets and liabilities of the Company's subsidiaries are translated into U.S. dollars using the exchange rate on the balance sheet date. Revenue and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive loss within the unaudited condensed consolidated statements of changes in shareholders' deficit.

Unless indicated otherwise, throughout this Quarterly Report on Form 10-Q, we refer to Marvion Inc. and its consolidated subsidiaries, as "MVNC," "we," "us" and "our."

Numerical information in this report is presented on a rounded basis using actual amounts. Minor differences in totals and percentage calculations may exist due to rounding.

Description of Business

Marvion Inc. was incorporated in the State of Nevada on March 6, 2008. The Company and its subsidiaries are hereinafter referred to as (the "Company"). Marvion Inc. is not a Hong Kong operating company but a Nevada holding company with operations conducted through its wholly owned subsidiaries based in the British Virgin Islands and Hong Kong. Our investors hold shares of common stock in Marvion Inc., the Nevada holding company.

On August 15, 2024, the Company and United Warehouse Management Corp., a British Virgin Island corporation ("UWMC") and eleven shareholders of UWMC entered into a Share Exchange Agreement (the "SEA") pursuant to which the shareholders of UWMC agreed to transfer to the Company 4,000 shares of UWMC, constituting all of the issued and outstanding securities of UWMC, in exchange for 148,148,150 shares of common stock of the Company, par value $0.0001 per share (the "share exchange transaction").

In addition to the Acquisition Shares, the Company agreed to make earnout payments in the aggregate amount of $5.5 million (collectively, the "Earn Out Payments") upon UWMC's achievement of certain net income performance milestones during each six month period ending June 30 and December 31 (each, a "Performance Period") for a total of nine Performance Periods. The Earn Out Payments will be payable in the form of interest free promissory notes and shared equally among Chan Sze Yu, Fong Hiu Ching and Young Chi Kin Eric who are also shareholders of UWMC. The Acquisition transactions contemplated by the SEA were consummated on September 12, 2024.

As a result of the Acquisition, Marvion became engaged in the business of logistics and warehousing services. Concurrently with the acquisition of UWMC, the Company also divested its ownership of Marvion Holdings Limited and all of its subsidiaries and ceased its the lifestyle, media and entertainment creation and distribution, and technology businesses.

Chan Sze Yu is our Chief Executive Officer, Chief Financial Officer, Secretary and Director, Young Chi Kin Eric holds 10,000,000 shares of the Company's Series A Preferred Stock which entitles him to vote on all matters submitted to a vote of the shareholders together with the Common Stock holders with each one share of Series A Preferred Stock having 200 votes.

The foregoing descriptions of the SEA and the Promissory Notes are qualified in their entirety by reference to the SEA and the Promissory Notes, which are filed as Exhibits 10.1 through and including 10.4 and incorporated herein by reference.

The share exchange transaction has been accounted for as a reverse merger and recapitalization of the Company, whereby UWMC is deemed to be the accounting acquirer (legal acquiree) and the Company to be the accounting acquiree (legal acquirer). Accordingly, the consolidated assets, liabilities and results of operations of the Company will become the historical financial statements of UWMC, and the Company's assets, liabilities and results of operations will be consolidated with UWMC beginning on the date of the share exchange transaction. No goodwill is recognized in this transaction. The historical financial statements prior to the share exchange transaction are those of the accounting acquirer (UWMC). Historical stockholders' equity of the accounting acquirer prior to the reverse merger are retroactively restated (a recapitalization) for the equivalent number of shares received in the merger. Operations prior to the merger are those of the acquirer. After completion of the share exchange transaction, the Company's accompanying unaudited condensed consolidated financial statements have been restated for all periods presented accordingly.

We are currently engaged in the logistic, warehousing service and financial consulting services in Hong Kong. Our businesses are operated through three subsidiaries organized in Hong Kong: KSK Logistic Limited ("KSK"), United Warehouse Management Limited ("UWML") and Propose Enterprise Limited ("PEL"), which provide the following services:

	·	KSK: Provides logistics services for last mile deliveries for retail and business customers;
	·	UWML: Provides warehousing and distribution services; and
	·	PEL: Provides business advisory solutions to customers.

In addition to our logistics, warehousing and delivery services, we are utilizing our warehouse facilities to build up solar photovoltaic system on the rooftops which can generate solar power and sell to CLP Power Hong Kong Limited under the Feed-in Tariff scheme. This will provide us with a long-term, stable revenue stream while further reducing its carbon footprint.

Our corporate structure is described below:

We are authorized to issue up to 270,000,000,000 shares of our common stock, par value $0.0001. Our Board has also designated the following classes of preferred stock: (i) the Series A Preferred Stock," par value $0.0001, with 10,000,000 authorized shares, all of which are issued and outstanding; (ii) "Series B Preferred Stock," par value $0.0001, with 1,000,000 authorized shares, 366,346 of which are issued and outstanding; and (iii) the "Series C Convertible Preferred Stock," par value $0.001, with 1 authorized share, all of which are issued and outstanding. The voting and conversion rights of each series of preferred stock and the beneficial ownership of such securities by insiders are summarized below:

Stock	Voting Rights	Ownership
Common Stock	One vote per share	4.26% held by Lee Ying Chiu Herbert. 5.35% held by Young Chi Kin Eric. 5.22% held by Chan Sze Yu.
Series A Preferred Stock	Holders of Series A Preferred Stock are entitled to vote on matters submitted to a vote of the shareholders with each one share having 200 votes. Series A Preferred Stock do not convert into Common Stock.	100% held by Young Chi Kin Eric.
Series B Preferred Stock	Holders of Series B Preferred Stock have no voting rights, and Series B Preferred Stock do not convert into Common Stock.	Approximately 92% held by Lee Ying Chiu Herbert.
Series C Convertible Preferred Stock	Holders of Series C Convertible Preferred Stock are generally not allowed to vote on an "as converted" basis on matters submitted to holders of the common stock, or any class thereof. Each one share of Series C Convertible Preferred Stock converts into 9.99% of the outstanding shares of common stock less the number of shares of common stock held by the holder; provided that any such optional conversion must involve the conversion of all of the holder's shares of Series C Convertible Preferred Stock.	100% held by Lee Ying Chiu Herbert.

Young Chi Kin Eric and Chan Sze Yu will be entitled to control approximately 91.61% and 0.81%, respectively, of our voting power on matters submitted to a vote of the shareholders. We do not intend to utilize controlled company exemptions.

Current Revenue Generating Operation

BUSINESS SEGMENT INFORMATION

The following table summarizes revenue from contracts with customers, disaggregated by revenue source and the related segments, for the nine months ended September 30, 2025 and 2024:

		Nine Months ended September 30,
Types of segments/revenue sources		2025				2024
Supply chain segment:
Logistic services income		$	1,212,610			$	468,142
Warehousing services income			1,093,710				403,229
			2,306,320				871,371
Financial segment:
Financial consulting services income			172,575				148,222
		$	2,478,895			$	1,019,593

The following table summarizes revenue from contracts with customers, disaggregated by revenue source and the related segments, for the three months ended September 30, 2025 and 2024:

		Three Months ended September 30,
Types of segments/revenue sources		2025				2024
Supply chain segment:
Logistic services income		$	462,498			$	204,433
Warehousing services income			425,070				134,638
			887,568				339,071
Financial segment:
Financial consulting services income			60,536				51,204
		$	948,104			$	390,275

Revenue Generating Operation in the Near Future (Next 12 Months).

We will be accelerating the B2B logistics and warehousing expansion. Our newly operational warehouse is already delivering value to the group, with a major logistic partner (which is a HKEX listed company) who is now utilizing our facilities for integrated warehousing and last-mile delivery services. We have been appointed as the exclusive local delivery partner for SF Express in Yuen Long. - a high-growth district with increasing e-commerce demand. This collaboration not only locks in recurring revenue but also positions us for further expansion with other logistics leaders.

Our subsidiary, United Warehouse Limited has signed a Service Partnership Agreement with Starwarehouse Engineering to install solar PV systems on the roof of our warehouses. The generated power will be sold to China Light and Power (CLP) at the defined tariff scheme rate, creating an additional long term stable revenue stream to the group, at the same time reducing our carbon footprint in the society. The partnership is expected to start generating revenue for the group in mid 2026and continue until December 31, 2033.

Revenue Generating Operation in the Farther Future (Beyond the Next 12 Months)

In the future, we are looking into expanding more into the Business to Consumer (B2C) business opportunities.

Based on the market expertise of our management team in the furniture industry, and the cross-border ecommerce growth from China to Hong Kong, we are seeking to develop a furniture online ecommerce platform which can provide a one-stop furniture shopping experience for consumers. According to Statista, Hong Kong consumers prefer online shopping and the percentage of consumers choosing to shop online will reach 84.1% by 2027. China has a mature online furniture ecommerce market, with 50% of consumers in China already purchasing their furniture online. We plan to provide a rich selection of furniture from the already mature China ecommerce market to the consumers in Hong Kong, with integrated logistics, delivery and furniture assembly services with a simple press of a button on our future furniture ecommerce platform.

We are also looking into servicing the cross-border furniture delivery services, providing furniture e-commerce players in mainland China with cost effective services to deliver their products to customers in Hong Kong. With our extensive experience in handling local furniture delivery, our logistic services can generate higher-margin storage, delivery, and assembly contracts, as a one-stop service. Leveraging existing e-commerce platforms' markets reduce our costs to get more orders while giving us exposure to 84% of Hong Kong's online shoppers. (Statista 2027 Forecast). We are deferring our previous E-Commerce platform plan due to the near-term market volatility due to the global tariff war. We will retain the infrastructure built and the efforts spent to look for the opportunity to re-enter into this market once market condition becomes more stable. We still see long term upward opportunities in the E-Commerce market.

Results of Operations.

Three Months Ended September 30, 2025, as compared to Three Months Ended September 30, 2024

The following table sets forth selected financial information from our statements of comprehensive income for the three months ended September 30, 2025 and 2024:

		Three Months Ended September 30,
		2025				2024
Revenues, net		$	948,104			$	390,275
Cost of revenues			(556,744	)			(193,891	)
Gross profit			391,360				196,384
Operating expenses:
General and administrative expenses			(327,884	)			(573,438	)
Total operating expenses			(327,884	)			(573,438	)
Income (loss) from operations			63,476				(377,054	)
Interest income			118				612
Interest expense			(45,977	)			(35,974	)
Income (loss) before income taxes			17,617				(412,416	)
Income tax expense			(12,519	)			(2,531	)
Net income (loss)		$	5,098			$	(414,947	)

Revenues

The Company currently generates three sources of revenue:

		Three Months Ended September 30,
		2025				2024
Logistic service income		$	462,498			$	204,433
Warehousing service income			425,070				134,638
Financial consulting income			60,536				51,204
		$	948,104			$	390,275

All of our revenues are derived in Hong Kong.

Revenues from logistic solution services to the customers, in which such local transportation, delivery and packaging services at the time the customers require packed products to be shipped by the Company to domestic destinations designed by the customers. The Company's performance obligation has been satisfied when the products been delivered to the designated recipient and confirmed the completion with customer. Generally, the Company will reconcile the delivery order with the customer monthly and recognized revenue after completion of monthly reconciliation. The Company will issue invoices to customers at each month end, and usually provide the receivable in a credit term of 30 days.

Revenues from storage services at the designated warehouse facilities are recognized ratably over the term of the contract or arrangement, as the Company performs contractual obligations through continuous transfer of control to the customers, and they could simultaneously receive and consume the benefits of the Company's performance as it occurs. The Company generally invoices customers monthly at the end of each month in arrear for services performed during the month. The performance obligation is satisfied when the services are performed. Warehousing contracts typically consist of ongoing storage service in a term of 1-6 years, subject to renewal option. The Company recognized revenue when the Company issued monthly invoices to customers.

The Company also provides financial consulting services to the customers, and generally invoices customers when the performance obligation is satisfied. The duration of the service period is short, usually within 3 months. Transaction prices of financial consulting services to be rendered are typically based on contracted rates. The Company earns the fee arising from the facilitation of the placement of financing solutions with different credit institutions, which is recognized at a point in time when the service is completed and delivered to the customer. The Company recognized revenue when the Company issued invoices to customers after the performance obligation satisfied.

Revenues of $948,104 for the three months ended September 30, 2025, increased by $557,829 or 143% from $390,275 in the same period of 2024, which was mainly due to the increase in number of customers in rendering logistics and warehousing services. Revenues of $390,275 for the three months ended September 30, 2024, consisted mainly logistics and warehousing services.

For the three months ended September 30, 2025 and 2024, the individual customer who accounted for 10% or more of the Company's revenues and its outstanding receivable balances at period-end dates, are presented as follows:

		Three Months ended September 30,								September 30, 2025
Customer		2025				2024				Accounts receivable
Kwai Bon Transportation Limited			57.96%				-			$	329,478
Lei Tat Trading (International) Limited			17.26%				-				29,558
Pro King International Warehouse Limited			14.16%				34.50%				89,959
Furniture Station Limited			-				35.61%				-

These customers are located in Hong Kong.

Cost of Revenues

Cost of revenues of $556,744 for the three months ended September 30, 2025, consisted primarily of the direct wages, telemarketing service charges, depreciation and amortization of right-of-use assets. Cost of revenues increased by $362,853, as compared to $193,891 in the same period of 2024, which was mainly due to the increase in direct operating costs in logistics services. Cost of revenues of $193,891 for the three months ended September 30, 2024 consisted primarily of the direct wages for logistic service and depreciation and amortization of right-of-use assets.

For the three months ended September 30, 2025 and 2024, the individual vendor who accounted for 10% or more of the Company's direct operating cost and its outstanding payable balances at period-end dates, are presented as follows:

		Three Months ended September 30,								September 30, 2025
Vendor		2025				2024				Accounts payable
Ching Fung E-Commerce Logistics Limited			36.10%				-			$	71,453
Ten Month Limited			18.64%				13.37%				42,979
Giant Winner Limited			-				23.07%				-
Ip Ming			-				11.69%				-

These vendors are located in Hong Kong and China.

Gross Profit

We achieved a gross profit of $391,360 and $196,384 for the three months ended September 30, 2025 and 2024, respectively. The increase in gross profit is attributable to an increase in new business in rendering logistics and warehousing services.

Operating Expenses

General and Administrative Expenses ("G&A"): General and administrative expenses of $327,884 and $573,438 for the three months ended September 30, 2025, and 2024, respectively. These expenses primarily include payroll, office operating costs, as well as professional fees.

Income Tax Expense

We incurred income tax expense of $12,519 and $2,531 during the three months ended September 30, 2025 and 2024, respectively.

Nine Months Ended September 30, 2025, as compared to Nine Months Ended September 30, 2024

The following table sets forth selected financial information from our statements of comprehensive income for the nine months ended September 30, 2025 and 2024:

		Nine Months Ended September 30,
		2025				2024
Revenues, net		$	2,478,895			$	1,019,593
Cost of revenues			(1,459,626	)			(517,252	)
Gross profit			1,019,269				502,341
Operating expenses:
General and administrative expenses			(870,363	)			(732,377	)
Total operating expenses			(870,363	)			(732,377	)
Income (loss) from operations			148,906				(230,036	)
Interest income			592				1,597
Interest expense			(169,965	)			(35,974	)
Gain on debt extinguishment			170,000				-
Income (loss) before income taxes			149,533				(264,413	)
Income tax expense			(29,657	)			(36,045	)
Net income (loss)		$	119,876			$	(300,458	)

Revenues

The Company currently generates three sources of revenue:

		Nine Months Ended September 30,
		2025				2024
Logistic service income		$	1,212,610			$	468,142
Warehousing service income			1,093,710				403,229
Financial consulting income			172,575				148,222
		$	2,478,895			$	1,019,593

All of our revenues are derived in Hong Kong.

Revenues from logistic solution services to the customers, in which such local transportation, delivery and packaging services at the time the customers require packed products to be shipped by the Company to domestic destinations designed by the customers. The Company's performance obligation has been satisfied when the products been delivered to the designated recipient and confirmed the completion with customer. Generally, the Company will reconcile the delivery order with the customer monthly and recognized revenue after completion of monthly reconciliation. The Company will issue invoices to customers at each month end, and usually provide the receivable in a credit term of 30 days.

Revenues from storage services at the designated warehouse facilities are recognized ratably over the term of the contract or arrangement, as the Company performs contractual obligations through continuous transfer of control to the customers, and they could simultaneously receive and consume the benefits of the Company's performance as it occurs. The Company generally invoices customers monthly at the end of each month in arrear for services performed during the month. The performance obligation is satisfied when the services are performed. Warehousing contracts typically consist of ongoing storage service in a term of 1-6 years, subject to renewal option. The Company recognized revenue when the Company issued monthly invoices to customers.

The Company also provides financial consulting services to the customers, and generally invoices customers when the performance obligation is satisfied. The duration of the service period is short, usually within 3 months. Transaction prices of financial consulting services to be rendered are typically based on contracted rates. The Company earns the fee arising from the facilitation of the placement of financing solutions with different credit institutions, which is recognized at a point in time when the service is completed and delivered to the customer. The Company recognized revenue when the Company issued invoices to customers after the performance obligation satisfied.

Revenues of $2,478,895 for the nine months ended September 30, 2025, increased by $1,459,302 or 143% from $1,019,593 in the same period of 2024, which was mainly due to the increase in number of customers in rendering logistics and warehousing services. Revenues of $1,019,593 for the nine months ended September 30, 2024, consisted mainly logistics and warehousing services.

For the nine months ended September 30, 2025 and 2024, the individual customer who accounted for 10% or more of the Company's revenues and its outstanding receivable balances at period-end dates, are presented as follows:

		Nine Months ended September 30,								September 30, 2025
Customer		2025				2024				Accounts receivable
Kwai Bon Transportation Limited			51.65%				-			$	329,478
Lei Tat Trading (International) Limited			19.65%				-				29,558
Pro King International Warehouse Limited			15.77%				39.55%				89,959
Furniture Station Limited			-				34.22%			$	-

These customers are located in Hong Kong.

Cost of revenues

Cost of revenues of $1,459,626 for the nine months ended September 30, 2025, consisted primarily of the direct wages, telemarketing service charges, depreciation and amortization of right-of-use assets. Cost of revenues increased by $942,374, as compared to $517,252 in the same period of 2024, which was mainly due to the increase in direct operating costs in logistics services. Cost of revenues of $517,252 for the nine months ended September 30, 2024 consisted primarily of the direct wages for logistic service and depreciation and amortization of right-of-use assets.

For the nine months ended September 30, 2025 and 2024, the individual vendor who accounted for 10% or more of the Company's direct operating cost and its outstanding payable balances at period-end dates, are presented as follows:

		Nine Months ended September 30,								September 30, 2025
Vendor		2025				2024				Accounts payable
Ching Fung E-Commerce Logistics Limited			32.23%				-			$	78,922
Ten Month Limited			21.67%				-				31,102
Giant Winner Limited			-				26.06%				-
Ip Ming			-				11.20%			$	-

These vendors are located in Hong Kong.

Gross Profit

We achieved a gross profit of $1,019,269 and $502,341 for the nine months ended September 30, 2025 and 2024, respectively. The increase in gross profit is attributable to an increase in new business in rendering logistics and warehousing services.

Operating Expenses

General and Administrative Expenses ("G&A"): General and administrative expenses of $870,363 and $732,377 for the nine months ended September 30, 2025, and 2024, respectively. These expenses primarily include payroll, office operating costs, as well as professional fees.

Income Tax Expense

We incurred income tax expense of $29,657 and $36,045 during the nine months ended September 30, 2025 and 2024, respectively.

Liquidity and Capital Resources

Working Capital

As of September 30, 2025, we had cash and cash equivalents of $397,864, account receivables of $568,099 and prepaid expenses and other current assets of 19,315.

As of December 31, 2024, we had cash and cash equivalents of $322,426, accounts receivable of $312,200 and prepaid expenses and other current assets of $16,773.

As of September 30, 2025 and December 31, 2024, we had working capital deficit of $4,928,831 and $4,171,189, respectively.

Going Concern

Our continuation as a going concern is dependent upon improving our profitability and the continuing financial support from our stockholders. Our sources of capital may include the sale of equity securities, which include common stock sold in private transactions, capital leases and short-term and long-term debts. While we believe that we will obtain external financing and the existing shareholders will continue to provide the additional cash to meet our obligations as they become due, there can be no assurance that we will be able to raise such additional capital resources on satisfactory terms. We believe that our current cash and other sources of liquidity discussed below are adequate to support operations for at least the next 12 months.

We require additional funding to meet its ongoing obligations and to fund anticipated operating losses. Our auditor has expressed substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations. These unaudited condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern.

We expect to incur marketing and professional and administrative expenses as well expenses associated with maintaining our filings with the Commission. We will require additional funds during this time and will seek to raise the necessary additional capital. If we are unable to obtain additional financing, we may be required to reduce the scope of our business development activities, which could harm our business plans, financial condition and operating results. Additional funding may not be available on favorable terms, if at all. We intend to continue to fund its business by way of equity or debt financing and advances from related parties. Any inability to raise capital as needed would have a material adverse effect on our business, financial condition and results of operations.

If we cannot raise additional funds, we will have to cease business operations. As a result, our common stock investors would lose all of their investment.

Cash Flows

The following summarizes the key component of our cash flows for the nine months ended September 30, 2025, and 2024:

		Nine Months Ended September 30,
		2025				2024
Net cash provided by operating activities		$	99,343			$	118,419
Net cash used in investing activities		$	(826,413	)		$	(707,869	)
Net cash provided by financing activities		$	788,965			$	610,321

Net Cash Provided by Operating Activities

For the nine months ended September 30, 2025, net cash provided by operating activities was $99,343, which consisted primarily of net income of $119,876, an increase in accrued liabilities and other payables of $14,368, an increase in accounts payable of $26,557, an increase in income tax payable of $29,701 and adjusted for non-cash items of depreciation for property and equipment of $164,547, amortization of right-of-use assets of $89,524, interest expenses on promissory notes payable of $164,965 and interest expenses on lease liabilities of $56,675, offset by an increase of account receivables, net of $255,899, an increase in prepaid expenses and other current assets of $2,542, a decrease of operating lease liabilities of $138,429 and adjusted for non-cash items of gain on debt extinguishment of $170,000.

For the nine months ended September 30, 2024, net cash provided by operating activities was $118,419, which consisted primarily of an increase in accrued liabilities and other payables of $471,225 and an increase in income tax payable of $36,045, and adjusted for non-cash items of depreciation for property and equipment of $55,658, amortization of right-of-use assets of $89,408, interest expenses on promissory notes payable of $35,974 and interest expenses on operating lease liabilities of $60,648, offset by a net loss of $300,458, a decrease of operating lease liabilities of $125,961, an increase in account receivables, net of $136,498, an increase in prepaid expenses and other current assets of $13,597, and a decrease in account payables of $54,025.

Net Cash Used In Investing Activities

For the nine months ended September 30, 2025, and 2024, net cash used in investing activities of $826,413 and $707,869, respectively, represents purchase of property and equipment during the period.

Net Cash Provided by Financing Activities

For the nine months ended September 30, 2025, net cash provided by financing activities of $788,965 which consisted primarily of $503,094 advance from the Company's shareholder, $561,315 advance from the Company's director, $125,654 repayment to the shareholder and $149,790 repayment to the director.

For the nine months ended September 30, 2024, net cash provided by financing activities of $631,145 represented the advances made by the Company's director.

All advances are interest-free and repayable on demand.

Material Cash Requirements

As of September 30, 2025, we had an accumulated deficit of $5,951,097. Our material cash requirements are highly dependent upon the additional financial support from our major shareholders in the next 12 - 18 months.

We are not party to any off-balance sheet transactions. We have no guarantees or obligations other than those which arise out of normal business operations.

Contractual Obligations and Commercial Commitments

On August 15, 2024, we, UWMC and eleven shareholders of UWMC entered into a Share Exchange Agreement (the "SEA") pursuant to which the shareholders of UWMC agreed to transfer to us 4,000 shares of UWMC, constituting all of the issued and outstanding securities of UWMC, in exchange for 148,148,148 shares of our common stock (the "Acquisition Shares"). In addition to the Acquisition Shares, we agreed to make earnout payments in the aggregate amount of $5.5 million (collectively, the "Earn Out Payments") upon UWMC's achievement of certain net income performance milestones during each six-month period ending June 30 and December 31 (each, a "Performance Period") for a total of nine Performance Periods. The Earn Out Payments will be payable in the form of interest free promissory notes and shared equally among Chan Sze Yu, Fong Hiu Ching and Young Chi Kin Eric, who are also our shareholders.

As of September 30, 2025 and December 31, 2024, pursuant to the terms and calculations of the earnout provision, management has determined the final earnout of $1 million and $1 million, respectively, being vested pursuant to the agreement. As of September 30, 2025, the $2 million earnout amount has not been paid to these shareholders and recognized as "earnout payable" on the unaudited condensed consolidated balance sheets.

Except as noted above, we had no other contractual obligations and material commercial commitments as of September 30, 2025.

Critical Accounting Policies and Estimates

Our critical accounting policies and estimates have not changed since December 31, 2024. For a detailed description of the critical accounting policies and estimates of the Company, please refer to "Critical Accounting Policies and Estimates" included in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2024 Annual Report on Form 10-K.