Marwynn Holdings, Inc.

Risks Related to our Business and Industry

General Operations

Our management team lacks significant operational experience in the big data AI platform and battery recycling industries, and our failure to successfully manage our entry into these markets could have a material adverse effect on our business, financial condition, and results of operations.

Historically, our core business has not involved big data artificial intelligence infrastructure, e-waste recycling, or the industrial production of black mass. Consequently, our executive officers and management team have limited direct experience managing the unique technical, regulatory, and commercial challenges inherent in these specific sectors. Developing a big data AI platform hub and scaling battery processing facilities require highly specialized knowledge. If our management is unable to effectively adapt to these new operational demands, or if we fail to attract and retain qualified technical personnel and industry experts, our expansion efforts could be severely restricted. Any failure to successfully execute our strategy in these new markets could lead to a material adverse effect on our business, financial condition, and results of operations.

We operate in the highly competitive markets of food and beverage supply chain management, big data AI platform hubs, e-waste recycling, and black mass production, and we expect to incur substantial losses without generating significant near-term revenue due to recent expansions.

We face intense competition across all of our targeted operating segments. The big data AI platform sector is dominated by well-capitalized technology companies with established infrastructure and stable cooperations among partners, while the e-waste and battery recycling markets include both legacy processors and rapidly growing specialized firms with advanced or patented processing technologies. Similarly, the food and beverage supply chain industry is highly fragmented and competitive. We anticipate incurring significant upfront capital expenditures and operating expenses to build out our AI infrastructure and physical battery processing capabilities. Because these development cycles are highly capital-intensive and time-consuming, we do not anticipate generating material revenue or achieving substantial commercial milestones from these new business lines in the near term. If we cannot compete effectively, secure necessary market share, or successfully manage operations across these diverse segments, we may never achieve profitability.

We currently hold no patents for our big data AI platform or battery processing technologies, which limits our ability to protect our intellectual property and exposes us to intense competition and potential infringement claims.

To date, we have not acquired or developed any patents covering our artificial intelligence infrastructure, e-waste reverse supply chain processes, or “black mass” production methods. The markets for AI and advanced battery processing are characterized by rapid technological change and are dominated by competitors with extensive and established intellectual property portfolios. Without formal patent protection, we must rely entirely on unpatented proprietary know-how and trade secrets, and we may be unable to prevent competitors from reverse-engineering or independently developing technologies and business models that are similar or superior to ours. Furthermore, as we expand into these heavily patented fields, we face a heightened risk of inadvertently infringing upon the intellectual property rights of established technology companies or legacy recyclers. Any claims of infringement against us, regardless of their merit, could result in costly litigation, force us to pay substantial royalties, or require us to cease utilizing critical technologies, which would have a material adverse effect on our business and results of operations.

Our business model portfolio includes fundamentally unrelated industries with no material operational synergies, which may divide management’s attention, strain our financial resources, and create significant inefficiencies.

Following our planned expansions, our operations will span three distinct and unrelated sectors: food and beverage supply chain management, AI platform hubs, and hazardous battery recycling for black mass production. These distinct business lines do not share overlapping customer bases, supply chains, technical requirements, or regulatory frameworks. Consequently, we do not anticipate realizing any material operational or financial synergies among them. Managing such disparate operations requires widely divergent expertise and the appropriate allocation of capital across entirely separate markets. This highly fragmented organizational structure may severely distract our management team, spread our financial and operational resources too thinly, and prevent us from competing effectively against those competitors that are exclusively focused on a single industry. If we cannot effectively manage the complexities and resource demands of these divided operations, our overall business, financial condition, and results of operations will be materially adversely affected.

We have an evolving business model, which increases the complexity of our business.

Our business model has evolved in the past and continues to do so. In prior years we have added additional types of services and product offerings and in some cases, we have modified or discontinued those offerings. We intend to continue to try to offer additional types of products or services, and we do not know whether any of them will be successful. From time to time we have also modified aspects of our business model relating to our product mix. We do not know whether these or any other modifications will be successful. The additions and modifications to our business have increased the complexity of our business and placed significant strain on our management, personnel, operations, systems, technical performance, financial resources, and internal financial control and reporting functions. Future additions to or modifications of our business are likely to have similar effects. Further, any new business or website we launch that is not favorably received by the market could damage our reputation or our brand. The occurrence of any of the foregoing could have a material adverse effect on our business.

Our business is exposed to risks inherent in international operations. Changes in trade policy, including tariffs and global supply chain disruptions, could increase our costs and adversely affect our operations.

Our supply chain operations rely heavily on international suppliers, primarily located in Asia, to source materials, components, and finished products for our food, non-alcoholic beverage, and home improvement sectors. A significant portion of our food and cabinetry offerings are sourced or manufactured outside the United States, including in China, Vietnam, and other Asian countries. As a result, our cost structure and sourcing strategy are inherently exposed to geopolitical instability, macroeconomic fluctuations, and shifting trade policies.

Recent actions by the U.S. presidential administration, including the imposition of significant tariffs on imports from countries such as China, Mexico, Vietnam, and Canada, have heightened uncertainty in the global trade environment. These tariffs—along with potential retaliatory measures by other countries—may increase inflationary pressure and raise the costs of goods and shipping for our imported products. While several tariff announcements have been followed by announcements of limited exemptions and temporary pauses, these actions are unprecedented, have caused substantial uncertainty and volatility in financial markets and may result in further retaliatory measures. We have currently paused our imports from China in response to these developments and are actively seeking alternative sourcing arrangements domestically and in other countries where tariff exposure may be lower. However, diversifying our supplier base may result in increased procurement and logistics costs and added operational complexity.

The full extent and duration of these tariff programs remain uncertain and depend on numerous factors, including future U.S. trade negotiations, political developments, responses from foreign governments, and the potential granting of exemptions or exclusions. Even in regions not currently subject to tariffs, ongoing trade instability may prompt suppliers to raise prices, prioritize other markets, or modify production and delivery timelines. These dynamics could result in higher input and shipping costs, delays in product availability, or the need to engage new suppliers on less favorable terms.

In addition to direct cost increases, a volatile global trade environment increases the likelihood of supply chain disruption. Trade barriers, political conflict, and uncertainty surrounding tariffs can lead to logistics challenges such as shipping delays, port congestion, container shortages, and other transportation bottlenecks. These disruptions may hinder our ability to maintain adequate inventory levels or meet customer demand on a timely basis.

We do not currently hedge against commodity price or input cost volatility. Consequently, sustained increases in the cost of imported food products, cabinetry materials, or packaging could compress our gross margins if we are unable to offset these increases through pricing adjustments or operational efficiencies. Our efforts to mitigate these impacts through selective price increases or cost-saving initiatives may not succeed and could result in lower sales volumes or reduced profitability.

There is no guarantee that we could quickly secure replacement suppliers or routes that are as cost-effective or reliable as our current ones. Consequently, prolonged trade tensions or supply chain disturbances could significantly increase our operating costs and lead to inventory shortfalls, which may require us to adjust pricing or absorb margin impacts. Any failure to manage these international trade and supply chain risks could materially and adversely affect our business, financial condition, and results of operations.

We have a limited operating history in our current form and limited experience selling our products. As a result of continuing investments to expand our business, we may not achieve or sustain profitability.

Marwynn Holdings, Inc. was formed as a holding company on February 27, 2024, and operates through its wholly-owned subsidiaries FuAn, EcoLoopX and NexaCore. FuAn was incorporated in California on April 18, 2016, EcoLoopX was incorporated in the state of California on November 25, 2025, and NexaCore was incorporated in state of Delaware on March 27, 2026. Both EcoLoopX and NexaCore are startups and have limited operations at this time. As a result, we have a limited operating history and limited experience selling our products, establishing relationships with consumers, customers, suppliers, vendors and distributors and building our brand reputation. These and other factors combine to make it more difficult for us to accurately forecast our future operating results, which in turn makes it more difficult for us to prepare accurate budgets and implement strategic plans. We expect that this uncertainty will continue to exist in our business for the foreseeable future. If we do not address these risks and uncertainties successfully, our operating results could differ materially from our estimates and forecasts, and from the expectations of investors or analysts, which could harm our business and result in a decline in the trading price of our common stock.

As a developing company, we will need to adopt and implement a plan to increase awareness of our products, secure distribution channels, and foster and strengthen our supply, manufacturing and distribution relationships. It is likely our strategic priorities will need to evolve over time and our business would be materially and adversely affected if we do not properly adapt our strategies to our changing needs and changes in the market. As our operations develop and grow, we expect to experience significant increases in our working capital requirements. Even if we obtain additional capital and achieve profitability, given the competitive and evolving nature of the industry in which we operate, we may be unable to sustain or increase profitability and our failure to do so would adversely affect the Company’s business, including our ability to raise additional funds.

We will need to raise additional capital to fund our operations in furtherance of our business plan.

Until we are profitable, we will need to raise additional capital in order to fund our operations in furtherance of our business plan. The proposed financing may include shares of common stock, shares of preferred stock, warrants to purchase shares of common stock or preferred stock, debt securities, units consisting of the foregoing securities, equity investments from strategic development partners or some combination of each. Any additional equity financings may be financially dilutive to, and will be dilutive from an ownership perspective to, our stockholders, and such dilution may be significant based upon the size of such financing. Additionally, we cannot assure that such funding will be available on a timely basis, in needed quantities, or on terms favorable to us, if at all.

In order to raise additional capital, we may in the future offer additional shares of our common stock or other securities convertible into or exchangeable for our common stock at varying prices. We cannot predict whether future issuances of shares of our common stock or the availability of shares for resale in the open market will decrease the market price per share of our common stock. We are not restricted from issuing additional shares of common stock, including any securities that are convertible into or exchangeable for, or that represent the right to receive shares of common stock. Sales of a substantial number of shares of our common stock in the public market or the perception that such sales might occur, including, for example, sales under an “at the market offering” (the “ATM Offering”) as defined in Rule 415 under the Securities Act, could materially adversely affect the market price of the shares of our common stock. Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, our stockholders bear the risk of any future stock issuances reducing the market price of our common stock and diluting their stock holdings in us.

If we fail to effectively manage our growth, our business, financial condition and operating results could be harmed.

As we continue to expand, our continued growth could strain our existing resources, and we could experience ongoing challenges, including:

All efforts to address the potential challenges on our way to expansion require significant managerial, financial and human resources. We cannot assure you that we will be able to effectively or timely address operating difficulties and challenges to keep up with our growth. If we are unable to successfully address these difficulties, risks and uncertainties, our business, financial conditions and results of operations could be materially and adversely affected.

Additionally, we expect to continue expanding our operations through the growth of our subsidiaries, including NexaCore and EcoloopX, the development of new products and services, the leasing and operation of warehouse and manufacturing facilities, strategic acquisitions, and the expansion of our customer base and workforce. Our ability to successfully execute these initiatives will require us to effectively manage operational complexity, recruit and retain qualified personnel, integrate new technologies and acquired businesses, expand our internal controls and information systems, and maintain effective financial, legal, compliance, and administrative processes.

As our business grows, we expect to incur additional operating expenses and capital expenditures related to personnel, technology infrastructure, manufacturing facilities, logistics operations, cybersecurity, and regulatory compliance. If our management systems, operational processes, or internal controls fail to scale efficiently with our growth, we could experience operational disruptions, reduced productivity, higher costs, customer dissatisfaction, delays in project execution, or difficulties integrating acquisitions and new business lines.

In addition, our growth strategy depends on our ability to identify qualified employees, secure adequate financing when needed, establish effective management systems, maintain relationships with customers and strategic partners, and successfully execute our expansion plans. There can be no assurance that we will be able to achieve these objectives in a timely or cost-effective manner.

Any failure to effectively manage our anticipated growth could materially and adversely affect our business, financial condition, results of operations, cash flows, and the value of our common stock.

Our future success depends on our ability to develop, maintain, and expand our operating platforms, technology offerings, and commercial relationships.

Our growth strategy is centered on expanding our operating businesses and technology platforms, including EcoloopX’s electronic waste recycling and critical minerals recovery operations and NexaCore’s artificial intelligence and AI-enabled energy solutions. Our ability to compete successfully depends on our ability to continue developing these businesses, expand our service offerings, maintain strong customer and supplier relationships, attract strategic partners, and enhance our reputation in the markets we serve.

We expect to continue investing in new technologies, operational capabilities, strategic acquisitions, and business development initiatives. There can be no assurance that these investments will achieve the anticipated commercial acceptance or generate the expected financial returns. Our customers may choose competing technologies or service providers, market demand may evolve differently than anticipated, or we may be unable to successfully commercialize new products or services.

In addition, our reputation and market recognition are important to attracting customers, suppliers, strategic partners, and acquisition opportunities. Any deterioration in our reputation resulting from operational issues, cybersecurity incidents, product performance, regulatory matters, customer dissatisfaction, or negative publicity could adversely affect our ability to compete and grow.

If we are unable to successfully expand our operating platforms, commercial capabilities, and market presence, our business, financial condition, results of operations, and future prospects could be materially adversely affected.

Our operations depend on the availability of feedstock, equipment, components, logistics services, and third-party suppliers, and disruptions in our supply chain could adversely affect our business.

Our subsidiaries, including EcoloopX and NexaCore Technologies, rely on a network of suppliers, logistics providers, equipment manufacturers, technology vendors, and service providers to support our operations. EcoloopX depends on the timely availability of electronic waste, end-of-life batteries, recyclable materials, processing equipment, warehouse facilities, transportation services, and related industrial supplies. NexaCore Technologies relies on cloud infrastructure providers, software vendors, hardware manufacturers, semiconductor suppliers, and other technology partners to develop and deliver its artificial intelligence and AI-enabled energy solutions.

Our ability to meet customer demand depends on maintaining reliable sources of supply, accurately forecasting operational requirements, effectively managing inventory, coordinating logistics, and maintaining productive relationships with suppliers and business partners. Disruptions resulting from supplier capacity constraints, transportation delays, labor shortages, geopolitical events, natural disasters, inflation, tariffs, trade restrictions, cybersecurity incidents, or the financial instability of suppliers may increase costs, delay customer deliveries, postpone facility construction or equipment installation, interrupt manufacturing operations, or reduce product availability.

In addition, as we expand our warehouse operations, manufacturing facilities, and processing capacity, we will need to effectively manage inventory levels, warehouse operations, procurement activities, and distribution networks. Failure to accurately forecast demand or effectively manage our supply chain could result in excess inventory, inventory shortages, increased operating costs, reduced margins, lost sales opportunities, or customer dissatisfaction.

If we are unable to maintain a reliable and efficient supply chain or establish and preserve long-term relationships with key suppliers, equipment manufacturers, technology vendors, logistics providers, and feedstock suppliers, our business, financial condition, results of operations, and growth strategy could be materially adversely affected.

A shortage of qualified labor could negatively affect our business and materially reduce earnings.

The future success of our operations, including the achievement of our strategic objectives, depends on our ability, and the ability of third parties on which we rely to supply and to deliver our products, to identify, recruit, develop and retain qualified and talented individuals. As a result, any shortage of qualified labor could significantly and adversely affect our business. Employee recruitment, development and retention efforts that we or such third parties undertake may not be successful, which could result in a shortage of qualified individuals in future periods. Any such shortage could decrease our ability to effectively serve our customers and achieve our strategic objectives. Such a shortage would also likely lead to higher wages for employees (or higher costs to purchase the services of such third parties) and a corresponding reduction in our results of operations.

Unfavorable macroeconomic conditions in the U.S. may adversely affect our business, financial condition and results of operations.

Our operating results may be substantially affected by the operating and economic conditions in the regions in which we operate. Economic conditions can affect us in the following ways:

In addition, our existing operations are primarily in the U.S. The geographic concentration of our operations creates an exposure to economic conditions in the U.S. and any financial downturn in the U.S. could materially adversely affect our financial condition and results of operations.

Global health developments and economic uncertainty resulting from pandemics, such as the COVID-19 pandemic, and governmental action related thereto, may adversely affect, our business, financial condition and results of operations.

The impact of pandemics may have an adverse impact on numerous aspects of our business, financial condition and results of operations including, our growth, product costs, supply chain disruptions, labor shortages, logistics constraints, customer demand for our products and industry demand generally, consumer spending, our liquidity, the price of our securities and trading markets with respect thereto, and the global economy and financial markets generally. We cannot predict the duration of future pandemics or future governmental regulations or legislation that may be passed as a result of ongoing or future outbreaks. The impact of pandemics and the enactment of additional governmental regulations and restrictions may further adversely impact the global economy, the food, non-alcoholic beverage and home improvement industry, and our business specifically, despite prior or future actions taken by us.

We are dependent upon the timely delivery of products from our vendors. Prolonged diminution of global supply chains may impact the availability and price stability of future food supplies, which may in turn adversely impact our business.

The global supply chain, ranging from consumer goods, electronics, and industrial raw materials to food supplies, was negatively impacted by the COVID-19 pandemic, shipping bottlenecks, and rapidly rising freight costs. We import the majority of our products. Production is widely dispersed internationally and we depend on manufacturers of our products to timely deliver these components of our inventory in quantities sufficient to meet customer demand. Any disruptions or delays in our supply chains as a result of labor shortages, commodity shortages, or inefficiencies in distribution or logistical services could cause delays in the shipment or delivery of products customers. Any prolonged diminution of global supply chains may impact the availability and price stability of supplies for our products, which may in turn adversely impact our business.

If we cannot successfully manage the unique challenges presented by international markets, we may not be successful in our international operations and our sales and profitability may be negatively impacted.

Our ability to successfully conduct supply chain operations in, and source products and materials from, international markets is affected by many of the same risks we face in our U.S. operations, as well as unique costs and difficulties of managing international operations. Our international operations, including any expansion in international markets, may be adversely affected by local laws and customs, U.S. laws applicable to foreign operations and other foreign legal and regulatory constraints, as well as political, social and economic conditions. Risks inherent in international operations also include, among others, potential adverse tax consequences; international trade disputes, trade policy changes or potential tariffs and other import-related taxes and controls; inability to sell certain products due to customs actions, including regulatory enforcement inquiries, holds, detentions, and exclusions; greater difficulty in enforcing intellectual property rights; limitations on access to ports; risks associated with the Foreign Corrupt Practices Act and local anti-bribery law compliance; geopolitical or military conflicts or acts of war such as the conflicts in Ukraine and the Middle East, as well as any related sanctions or other government or private responses; compliance with forced labor laws; compliance with environmental and responsible sourcing laws and regulations; and challenges in our ability to identify and gain access to local suppliers. For example, trade tensions between the U.S. and China have led to a series of significant tariffs on the importation of certain products. As a portion of our products are sourced, directly or indirectly, outside of the U.S., major changes in tax or trade policies, tariffs or trade relations could adversely impact the cost of, demand for, and profitability of product sales in our U.S. locations. Other countries may also change their business and trade policies in anticipation of or in response to increased import tariffs and other changes in U.S. trade policy and regulations. In addition, our operations in international markets create risk due to foreign currency exchange rates and fluctuations in those rates, which may adversely impact our sales and profitability. While the conflicts in Ukraine and the Middle East have not directly impacted the Company to date, we continue to monitor the impacts of such conflicts and their potential effects on the world economy and global supply chain which on a go-forward basis could impact our operations, sales and profitability.

Our relationships with customers may be materially diminished or terminated. The loss of customers could adversely affect our business, financial condition, and results of operations.

We have maintained long-standing relationships with a number of our customers. However, those customers could unilaterally terminate their relationship with us or materially reduce the amount of business they conduct with us at any time. Our customers may shift their purchase orders from us to other competitors due to market competition, change of customer requirements and preferences, or because of the customer’s financial condition. There is no guarantee that we will be able to maintain relationships with any of our customers on acceptable terms, or at all. The loss of a number of customers could adversely affect our business, financial condition, and results of operations.

We rely on technology in our business and any cybersecurity incident, other technology disruption or delay in implementing new technology could negatively affect our business and our relationships with customers.

We use technology in our business operations, and our ability to serve customers most effectively depends on the reliability of our technology systems. We use software and other technology systems, among other things, to generate and select orders, to make purchases, to manage warehouses and to monitor and manage our business on a day-to-day basis. Further, our business involves the storage and transmission of numerous classes of sensitive and/or confidential information and intellectual property, including customers’ and suppliers’ personal information, private information about employees, and financial and strategic information about us and our business partners.

These technology systems are vulnerable to disruption from circumstances beyond our control, including fire, natural disasters, power outages, systems failures, security breaches, espionage, cyber-attacks, viruses, theft and inadvertent releases of information. Any such disruption to these software and other technology systems, or the technology systems of third parties on which we rely, the failure of these systems to otherwise perform as anticipated, or the theft, destruction, loss, misappropriation, or release of sensitive and/or confidential information or intellectual property, could result in business disruption, negative publicity, brand damage, violation of privacy laws, loss of customers, potential liability and competitive disadvantage, any or all of which could potentially adversely affect our customer service, decrease the volume of our business and/or result in increased costs and lower profits.

A significant cybersecurity incident involving our cybersecurity infrastructure may result from actions by our employees, suppliers, third-party administrators, or unknown third parties or through cyber-attacks. The risk of such an incident can exist whether software services are in our technology systems or are in cloud-based software services. Intrusions and other incidents have occurred, and may occur again, in our systems and in the systems of our suppliers and third-party administrators. Any such incident could result in operational impairments, significant harm to our reputation and financial losses.

A significant cybersecurity incident could affect our data framework or cause a failure to protect the personal information of our customers, suppliers or employees, or sensitive and confidential information regarding our business and could give rise to legal liability and regulatory action under data protection and privacy laws. Any such cybersecurity incident involving our or our suppliers’ cybersecurity infrastructure could have a material adverse effect on our business, results of operations and financial condition.

Further, as we pursue our strategy to grow our businesses and pursue new initiatives that improve our operations and cost structure, we are also expanding and improving our information technology, resulting in a larger technological presence and corresponding exposure to cybersecurity risk. If we fail to assess and identify cybersecurity risks associated with new initiatives, we may become increasingly vulnerable to such risks. Information technology systems continue to evolve and, in order to remain competitive, we need to implementnew technologiesin a timely and efficient manner. Investments will continue to be made in attracting, retaining, and training our human capital to remain current on the ever-changing industry best practices related to information security. If our competitors implement new technologies more quickly or successfully than we do, such competitors may be able to provide lower cost or enhanced services of superior quality compared to those we provide, which could have an adverse effect on our results of operations.

We may be unable to protect or maintain our intellectual property, which could result in customer confusion, a negative perception of our brand and adversely affect our business.

We believe that our intellectual property has substantial value and has contributed significantly to the success of our business. Our trademark rights and related registrations may be challenged in the future and could be canceled or narrowed. Failure to protect our trademark rights could cause customer confusion or negatively affect customers’ perception of our brand, services and products, and eventually adversely affect our sales and profitability. Moreover, intellectual property disputes and proceedings and infringement claims may result in a significant distraction for management and significant expense, which may not be recoverable regardless of whether we are successful. Such proceedings may be protracted with no certainty of success, and an adverse outcome could subject us to liability, force us to cease use of certain trademarks or other intellectual property or force us to enter into licenses with others. Any one of these occurrences may have a material adverse effect on our business, results of operations and financial condition.

If we are unable to renew or replace our current leases on favorable terms, or any of our current leases are terminated prior to expiration of their stated terms, and we cannot find suitable alternate locations, our operations and profitability could be negatively impacted.

We currently have leases for our offices, showrooms and some of our warehouses. Our ability to re-negotiate favorable terms on an expiring lease or to negotiate favorable terms for a suitable alternate location, and our ability to negotiate favorable lease terms for additional locations, could depend on conditions in the real estate market, competition for desirable properties, our relationships with current and prospective landlords, and/or other factors that are not within our control. Any or all of these factors and conditions could negatively impact our growth and profitability.

Failure to retain our senior management and other key personnel may adversely affect our operations.

Our success is substantially dependent on the continued service of our senior management and other key personnel. These executives have been primarily responsible for determining the strategic direction of our business and for executing our growth strategy and are integral to our brand and culture, and our reputation with suppliers and customers. The loss of the services of any of these executives and other key personnel could have a material adverse effect on our business and prospects, as we may not be able to find suitable individuals to replace them on a timely basis, if at all. In addition, any such departure could be viewed in a negative light by investors and analysts, which may cause our stock price to decline. The loss of key employees could negatively affect our business.

If we are unable to attract, train and retain employees, we may not be able to grow or successfully operate our business.

The food and non-alcoholic beverage and home improvement product supply chain and distribution industry is labor intensive. Our success depends in part upon our ability to attract, train and retain a sufficient number of employees who understand and appreciate our culture and are able to represent our brand effectively and establish credibility with our business partners and customers. Our ability to meet our labor needs, while controlling wage and labor-related costs, is subject to numerous external factors, including the availability of a sufficient number of qualified persons in the work force of the regions in which we are located, unemployment levels within those regions, prevailing wage rates, changing demographics, health and other insurance costs and changes in employment legislation.

In the event of increasing wage rates, if we fail to increase our wages competitively, the quality of our workforce could decline, causing our customer service to suffer, while increasing our wages could cause our profits to decrease. If we are unable to hire and retain employees capable of meeting our business needs and expectations, our business and brand image may be impaired. Any failure to meet our staffing needs or any material increase in turnover rates of our employees may adversely affect our business, results of operations and financial condition.

Changes in and enforcement of immigration laws could increase our costs and adversely affect our ability to attract and retain qualified employees.

Federal and state governments from time to time implement immigration laws, regulations or programs that regulate our ability to attract or retain qualified foreign employees. Some of these changes may increase our obligations for compliance and oversight, which could subject us to additional costs and make our hiring process more cumbersome or reduce the availability of potential employees. Although we have implemented, and are in the process of enhancing, procedures to ensure our compliance with the employment eligibility verification requirements, there can be no assurance that these procedures are adequate and some of our employees may, without our knowledge, be unauthorized workers. The employment of unauthorized workers may subject us to fines or civil or criminal penalties, and if any of our workers are found to be unauthorized, we could experience adverse publicity that negatively impacts our brand and makes it more difficult to hire and keep qualified employees. We may be required to terminate the employment of certain of our employees who are determined to be unauthorized workers. The termination of a significant number of employees may disrupt our operations, cause temporary increases in our labor costs as we train new employees and result in adverse publicity. Our financial performance could be materially harmed as a result of any of these factors.

Potential labor disputes with employees and increases in labor costs could adversely affect our business.

A considerable amount of our operating costs are attributable to labor costs and, therefore, our financial performance is greatly influenced by increases in wage and benefit costs. As a result, we are exposed to risks associated with a competitive labor market. Rising health care costs and the nature and structure of work rules will always be important issues. Any work stoppages or labor disturbances as a result of employee dissatisfaction with their current employment terms could have a material adverse effect on our financial condition, results of operations and cash flows. We also expect that in the event of a work stoppage or labor disturbance, we could incur additional costs and face increased competition.

We may incur significant costs to comply with environmental laws and regulations, and we may be subject to substantial fines, penalties and/or third-party claims for non-compliance.

Our operations are subject to various federal, state, and local laws, rules and regulations relating to the protection of the environment, including those governing:

We may incur substantial costs, including fines or penalties and third-party claims for property damage or personal injury, as a result of any violations of environmental or workplace safety laws and regulations or releases of regulated materials into the environment. In addition, we could incur investigation, remediation and/or other costs related to environmental conditions at our currently or formerly owned or operated properties.

Litigation may materially adversely affect our business, financial condition and results of operations.

From time to time, we may be party to various claims and legal proceedings. We evaluate these claims and proceedings to assess the likelihood of unfavorable outcomes and to estimate, if probable and estimable, the amount of potential losses. Based on these assessments and estimates, we may establish reserves, as appropriate. These assessments and estimates are based on the information available to management at the time and involve a significant amount of management judgment. Actual outcomes or losses may differ materially from our assessments and estimates.

Even when not merited, the defense of these lawsuits or legal proceedings, including potential securities litigation and/or other legal actions, is expensive and may divert management’s attention, and we may incur significant expenses in defending these lawsuits or legal proceedings. The results of litigation and other legal proceedings are inherently uncertain, and adverse judgments or settlements in some of these legal disputes may result in adverse monetary damages, penalties or injunctive relief against us, which could negatively impact our financial position, cash flows or results of operations.

The U.S. government is currently imposing increased tariffs on certain products imported into the U.S., including products imported from China, which may have an adverse impact on our future operating results.

We sell our products based on the cost of such products plus a percent markup. The U.S. government has imposed and continues to propose increased tariffs on certain products imported into the U.S., including products imported from China. During the first quarter of 2025, the U.S. government has introduced additional trade policy actions that have increased import tariffs across a wide range of countries at various rates. These tariff changes and subsequent retaliatory actions have the potential to increase product costs for us. Some of our imported products and imported products purchased from domestic brokers are subject to these increased tariffs and accordingly, our purchase costs have increased and may increase further. As a result of such developments, we have currently paused all imports from China and are actively seeking alternative sourcing arrangements domestically and in other countries where tariff exposure may be lower. We may also determine to increase our sales prices in order to pass these increased costs to our customers. In the event we determine to take such action, our customers may reduce their orders from us, which could negatively affect our profitability and operating results. If we are unable to diversity our supply chain and reduce China sourcing, we remain subject to substantial potential exposure to tariffs, which would have significant impacts on our cost structure and product margins.

In addition, any changes in tariffs or additional restrictions on various products may be announced with little or no advance notice. The adoption and expansion of tariffs or other trade restrictions, increasing trade tensions, or other changes in governmental policies related to tariffs, trade agreements, products or policies, are difficult to anticipate or predict, which makes it difficult for us to operate optimally. If we are unable to navigate further changes in U.S. or international trade policy, it could have a material adverse impact on our business and results of operations. We are closely monitoring potential changes in international trade policy and assessing the potential impact of these and other trade policy changes on our business operations and financial performance.

Severe weather, natural disasters and adverse climate changes, as well as the legal, regulatory or market measures being implemented to address climate change, may materially adversely affect our financial condition and results of operations.

Severe weather conditions and other natural disasters in areas where our distribution network covers or from which we obtain the products we sell may materially adversely affect our operations and our product offerings and, therefore, our results of operations. Such conditions may result in physical damage to, or temporary or permanent closure of, one or more of our distribution centers, an insufficient work force in our market regions and/or temporary disruption in the supply of products, including delays in the delivery of goods to our warehouses and/or a reduction in the availability of products in our offerings. In addition, adverse climate conditions and adverse weather patterns, such as drought or flood, that impact growing conditions and the quantity and quality of crops may materially adversely affect the availability or cost of certain products within our supply chain. Any of these factors may disrupt our businesses and materially adversely affect our financial condition, results of operations and cash flows.

There is an increased focus around the world by regulatory and legislative bodies at all levels towards policies relating to climate change and the impact of global warming, including the regulation of greenhouse gas (GHG) emissions, energy usage and sustainability efforts. Increased compliance costs and expenses due to the impacts of climate change on our business, as well as additional legal or regulatory requirements regarding climate change or designed to reduce or mitigate the effects of carbon dioxide and other GHG emissions on the environment, may cause disruptions in, or an increase in the costs associated with, the running of our business, particularly with regard to our distribution and supply chain operations. Moreover, compliance with any such legal or regulatory requirements may require that we implement changes to our business operations and strategy, which would require us to devote substantial time and attention to these matters and cause us to incur additional costs. The effects of climate change, and legal or regulatory initiatives to address climate change, could have a long-term adverse impact on our business and results of operations.

Our business may be affected by the impacts of unfavorable geopolitical events or other market disruptions on consumer confidence and spending patterns.

Our net sales, profit, cash flows and future growth may be affected by negative local, regional, national or international political or economic trends or developments that reduce consumers’ ability or willingness to spend, including the effects of national and international security concerns such as war, terrorism or the threat thereof. Conflicts such as the Russian invasion of Ukraine in February 2022 and the financial and economic sanctions and other measures imposed by the European Union, the U.S., and other countries and organizations in response thereto create market disruption and volatility and instability in the geopolitical environment. The extent to which this or similar conflicts escalate and the resulting impact on the global market remains uncertain. We monitor such conflicts, but do not, and cannot, know if any such ongoing geopolitical conflicts will result in broader economic and security concerns or in material implications for our business. These events could have a material adverse effect on our customers, our business partners and our third-party suppliers.

Our current indebtedness may adversely affect our liquidity position and ability of future financing.

As of the date of this report, we have $100,000 in third party financing (including short-term loan of $100,000) outstanding and $683,662 in unsecured promissory notes to related parties outstanding, which could adversely affect our cash flow, our ability to raise additional capital or obtain financing in the future, or react to changes in business and repay other debts. We may not be able to generate a sufficient amount of cash needed to pay interest and principal on our debt facilities or refinance all or a portion of our indebtedness, due to a number of factors, including significant change of economic conditions, market competition, weather conditions, natural disaster, and failure to execute our business plan.

Our business is subject to fluctuations in commodity prices, operating costs, and inflation, which could adversely affect our profitability and results of operations.

Our operations are subject to changes in the prices of commodities, raw materials, energy, transportation, labor, and other operating inputs. EcoloopX’s recycling and black mass production business depends on the availability and cost of electronic waste, end-of-life batteries, processing equipment, utilities, warehouse facilities, transportation services, and skilled labor. The market value of recovered materials, including lithium, nickel, cobalt, copper, aluminum, graphite, and other critical minerals, may fluctuate significantly due to changes in global supply and demand, geopolitical developments, technological advancements, government policies, and macroeconomic conditions.

NexaCore Technologies is also exposed to increases in operating costs associated with software development, cloud computing infrastructure, artificial intelligence platforms, data center services, semiconductor components, and highly skilled technical personnel. Inflationary pressures, wage increases, higher energy costs, increased interest rates, supply chain disruptions, or rising technology infrastructure costs may increase our operating expenses and reduce our operating margins.

Our ability to maintain profitability depends, in part, on our ability to effectively manage costs, improve operational efficiency, negotiate favorable commercial terms with customers and suppliers, and adjust pricing when market conditions permit. Competitive market conditions, long-term customer contracts, or rapidly changing market dynamics may limit our ability to pass increased costs on to customers in a timely manner or at all.

In addition, periods of sustained inflation, economic uncertainty, or recession may reduce customer capital expenditures, delay investment decisions, decrease demand for our products and services, and increase financing costs associated with our growth strategy. Conversely, significant declines in commodity prices may reduce the value of recovered materials produced by EcoloopX, negatively affecting revenue and profitability.

If we are unable to effectively manage fluctuations in commodity prices, operating costs, inflationary pressures, or changing market conditions, our business, financial condition, results of operations, cash flows, and future growth prospects could be materially adversely affected.

Food and Non-Alcoholic Beverages

We have experienced a significant decline in revenue within our FuAn business segment, which could materially and adversely affect our business, financial condition, and results of operations.

A significant portion of the our total revenue is generated by a single customer, Golden Honest Trading Limited, which purchased waste recycled copper materials from EcoLoopX. Sales to this customer totaled $3.0 million, representing approximately 71% of the Company’s total revenue. The remaining 29% of total sales was contributed by six customers associated with the FuAn business segment, of which, two customers accounted for 13% of total sales, primarily from the import and distribution of frozen lamb from New Zealand and mochi products from Taiwan.

Revenue within our FuAn business segment has recently declined significantly by 9% compared to fiscal year 2025. If we are unable to stabilize and recover the revenue in the FuAn segment, or if we lose Golden Honest Trading Limited, experience a reduction in their purchase volumes, or face adverse changes in their financial condition, our business will suffer. Our ability to generate sustainable revenue depends heavily on maintaining these relationships or rapidly diversifying our customer base and product lines, and we cannot assure you that we will be successful in doing so.

Our industry is characterized by low margins, and periods of significant or prolonged inflation or deflation affect our product and operational costs, which may negatively impact our profitability.

The food and non-alcoholic beverage supply chain and distribution industry is characterized by relatively high inventory turnover with relatively low profit margins. Volatile food costs have a direct impact on our industry. During the previous years, our industry experienced significantly elevated commodity and supply chain costs including the cost of labor, sourced goods, energy, fuel and other inputs necessary for the distribution of food and non-alcoholic beverage products, and elevated levels of inflation may continue or worsen and contribute to loss of revenue and gross profit margin in particular product categories. Our business and results of operations may be adversely affected if we are unable to adjust to these rising cost and inflationary pressures.

Periods of significant product cost inflation or deflation may adversely affect our results of operations if we are unable to pass on all or a portion of such product cost increases to our customers in a timely manner. In addition, periods of rapidly increasing inflation may adversely affect our business due to the impact of such inflation on discretionary spending by consumers and our limited ability to increase prices in the current, highly competitive environment.

Competition may increase in the future, which may adversely impact our margins and ability to retain customers, and make it difficult to maintain our market share, growth rate and profitability.

The Asian food and non-alcoholic beverage supply chain and distribution industry, as a whole, in the U.S. is fragmented and highly competitive, with local, regional, multi-regional distributors, and specialty competitors. With the growing demand for Asian cuisines, others are operating, or may begin operating in this niche market in the future. Those potential competitors include: (i) national and regional foodservice distributors, (ii) local wholesalers and brokers, (iii) food retailers, and (iv) farmers’ markets. The national and regional distributors are experienced in operating multiple distribution locations and expanding management, and they have greater marketing and financial resources than we do. Even though they currently offer only a limited selection of Asian specialty foods, they may be able to devote greater resources to sourcing, promoting and selling their products if they choose to do so. Conversely, the local wholesalers and brokers are small in size with a deep understanding of local preferences, but their lack of scale results in high risk and limited growth potential.

If more competitors enter this market segment in the future, our operating results may be negatively impacted through a loss of sales, reduction in margins from competitive price changes, and/or greater operating costs, such as marketing costs, due to the increase of competition.

Disruption of relationships with vendors could negatively affect our business. Suppliers may increase product prices, which could increase our product costs.

We purchase our food and non-alcoholic beverage items and related products from directly from manufacturers. If our manufacturer fails to comply with food safety or other laws and regulations, or face allegations of non-compliance, their operations may be disrupted. We cannot assure you that we would be able to find replacement suppliers on commercially reasonable terms.

The purchase prices of our products vary from time to time, which is subject to market conditions and negotiation with our suppliers. We may not always be able to mitigate the impact of these price fluctuations, and our performance results could be adversely affected by such fluctuations.

As a food and non-alcoholic beverage distributor, it is necessary for us to maintain an inventory of products that may have declines in product pricing levels between the time we purchase the product from suppliers and the time we sell the product to customers, which could reduce the margin on that inventory, adversely affecting our results of operations.

Changes in consumer eating habits could materially and adversely affect our business, financial condition, and results of operations.

We provide supply chain and distribution services primarily related to Asian food and non-alcoholic beverage products. Changes in consumer eating habits (such as a decline in portion sizes, or a shift in preferences toward western foods) could reduce demand for our customer’s products and the services we provide them. Consumer eating habits could be affected by a number of factors, including attitudes regarding diet and health or new information regarding the health effects of consuming certain foods. If consumer eating habits change significantly, we may be required to modify or discontinue sales of certain items in our product portfolio, and we may experience higher costs and/or supply shortages associated with our efforts to accommodate those changes as our suppliers adapt to new eating preferences.

Additionally, changes in consumer eating habits may result in the enactment or amendment of laws and regulations that impact the ingredients and nutritional content of our food products, or laws and regulations requiring us to disclose the nutritional content of our food products. Compliance with these laws and regulations, as well as others regarding the ingredients and nutritional content of food products, may be costly and time-consuming. We cannot make any assurances regarding our ability to effectively respond to changes in consumer culture preference, health perceptions or resulting new laws or regulations or to adapt our product offerings to trends in eating habits.

Our operations may be adversely affected by the disruption of logistics services or poor handling of products by third party logistics service providers.

We rely on third party logistics service providers to provide a range of transportation and logistics services, including the delivery of products, some of which are perishable, to our retail stores, warehouse and/or our customers. Any failure to provide on-time delivery or failure to maintain our products in good condition during delivery may have a material adverse impact on our business operations and our reputation. In such event, we be unable to seek full recourse against the logistics service providers in default under the terms of the service contracts or enforce in full any judgments obtained.

Significant portions of our inventory are perishable and vulnerable to spoilage and other loss.

Our operations involve the storage and stocking of a wide range of products with limited shelf life. Due to unexpected material fluctuations or abnormalities in the supply and demand of our products or changes in consumers’ preferences or the introduction of new products in the market, we may experience decrease in demand and overstocking of our products. Our products may also be returned by our customers in large quantities due to, among other things, product quality issues or delayed or incorrect delivery, resulting in shelving of products that may increase the risk of obsolescence.

In addition, certain of our products require specific handling throughout the supply chain. For instance, temperature control is required in warehouse or during the transportation of frozen foods in order to maintain the safety and quality of such products. Any unexpected and adverse changes in the optimal storage conditions or poor handling of products may cause damage to or result in deterioration or contamination of our products. As such, any of the aforesaid events may result in an increased risk of inventory obsolescence.

If we fail to comply with requirements imposed by applicable law and other governmental regulations, we could become subject to lawsuits, investigations and other liabilities and restrictions on our operations that could significantly and adversely affect our business.

We are subject to regulation by various federal, state, and local governments, applicable to food safety and sanitation, ethical business practices, securities, transportation, minimum wage, overtime, other wage payment requirements, employment discrimination, immigration, and human health and safety. While we attempt to comply with all applicable laws and regulations, we cannot represent that we are in full compliance with all applicable laws and regulations or interpretations of these laws and regulations at all times or that we will be able to comply with any future laws, regulations or interpretations of these laws and regulations. If we fail to comply with applicable laws and regulations, we may be subject to investigations, criminal sanctions or civil remedies, including fines and injunctions. The cost of compliance or the consequences of non-compliance, including debarments, could have an adverse effect on our results of operations. In addition, governmental units may make changes in the regulatory frameworks within which we operate that may require us to incur substantial increases in costs in order to comply with such laws and regulations.

If the products distributed by us are alleged to have caused injury or illness, or to have failed to comply with governmental regulations, we may need to recall our products and may experience product liability claims.

We, like any other food and non-alcoholic beverage distributor, may be subject to product recalls, including voluntary recalls or withdrawals, if the products we distribute are alleged to have caused injury or illness, to have been mislabeled, misbranded, or adulterated or to otherwise have violated applicable governmental regulations. We may also choose to voluntarily recall or withdraw products that we determine do not satisfy our quality standards, whether for taste, appearance, or otherwise, in order to protect our brand and reputation. Any future product recall or withdrawal that results in substantial and unexpected expenditures, destruction of product inventory, damage to our reputation, and/or lost sales due to the unavailability of the product for a period of time, could materially adversely affect our results of operations and financial condition.

We also face the risk of exposure to product liability claims in the event that the use of products sold by us are alleged to have caused injury or illness. We cannot be sure that consumption of our products will not cause a health-related illness in the future or that we will not be subject to claims or lawsuits relating to such matters. Further, even if a product liability claim is unsuccessful or is not fully pursued, the negative publicity surrounding any assertion that our products caused illness or injury could adversely affect our reputation with existing and potential customers and our corporate and brand image.

Our product liability insurance plans may not continue to be available at a reasonable cost or, if available, may not be adequate to cover all of our liabilities. We generally seek contractual indemnification and insurance coverage from parties supplying products to us, but this indemnification or insurance coverage is limited, as a practical matter, to the creditworthiness of the indemnifying party and the insured limits of any insurance provided by such suppliers. If we do not have adequate insurance or contractual indemnification available, product liability relating to defective products could materially adversely affect our results of operations and financial condition.

Increased commodity prices and availability may impact profitability.

Many of our products include ingredients such as wheat, corn, oils, sugar, and other commodities. Commodity prices worldwide have been increasing. While commodity price inputs do not typically represent the substantial majority of our product costs, any increase in commodity prices may cause our vendors to seek price increases from us. We may not be able to mitigate vendor efforts to increase our costs, either in whole or in part. In the event we are unable to mitigate potential vendor price increases, we may in turn consider raising our prices, and our customers may be deterred by any such price increases. Our profitability may be impacted through increased costs to us which may affect our gross margins, or through reduced revenue as a result of a decline in the number and average size of customer transactions.

We have a limited operating history and face significant risks related to our new EcoloopX business strategy, including substantial capital requirements, facility construction and feedstock procurement challenges, commodity price volatility, regulatory compliance, and intense industry competition.

EcoloopX is in the early stages of executing its business strategy. While management has identified significant opportunities within the electronic waste recycling and battery materials recovery industries, the Company’s operating history remains limited. There can be no assurance that EcoloopX will successfully execute its business plan, achieve projected revenue levels, or generate sustainable profitability.

As such, our inability to execute on our proposed business plan may have a material adverse effect on our results of operations and financial condition.

Failure on the parts of recycling and processing partners to comply with applicable laws and regulation may disrupt e-waste reverse supply chain which may have a material adverse effect on our results of operations and financial condition. Our planned expansion into the production of “black mass” will significantly increase our regulatory burden and direct operational risks.

Electronic waste materials may be subject to federal, state, and international environmental and hazardous materials regulations. At present, EcoLoopX provides non-operational supply chain services and does not engage in any physical processing, dismantling, recycling, or hazardous materials handling. EcoLoopX currently functions as an asset-light supply chain integrator thatconnects upstream e-waste generators, such as electronics distributors, IT asset disposition providers, and enterprise users, with licensed downstream processors, recyclers, and refiners in the United States and Asia. As such, our current model relies on third-party licensed refiners, recycling and processing partners to comply with applicable laws and regulations, and for processors, recyclers and refiners in Asia, cross-border shipments of e-waste may be affected by export controls, customs requirements, or international environmental agreements. Failure on the parts of those refiners, recycling and processing partners to comply with applicable laws and regulation may disrupt e-waste reverse supply chain which may have a material adverse effect on our results of operations and financial condition.

In April 2026, the Company announced plans to expand EcoLoopX beyond supply chain integration to include the direct physical processing and production of “black mass.” These proposed operations involve the direct handling, storage, transportation, and processing of certain parts of lithium-ion batteries. These activities will subject us directly to complex federal, state, and local environmental and safety laws governing hazardous waste and chemical exposure. Securing and maintaining the necessary environmental permits for this expansion will require significant capital and time. Any failure to strictly comply with these regulatory frameworks could result in material fines, facility shutdowns, or remediation liabilities. Furthermore, future changes in environmental laws regarding battery disposal or black mass refining could force us to materially alter our processing operations, increasing our capital expenditures and delaying our timeline to operation.

The economic value of recyclable materials is partially influenced by commodity prices such as copper, lithium, nickel, and cobalt.

Our e-waste reverse supply chain business relies on the economic value of recyclable materials is partially influenced by commodity prices such as copper, lithium, nickel, and cobalt. Sharp fluctuations in copper, lithium, nickel, and cobalt prices may have a material adverse effect on our results of operations and financial condition.

Our ability to generate revenue depends on securing reliable sources of electronic waste materials.

Our ability to generate revenue depends on securing reliable sources of electronic waste materials. Increased demand for e-waste recycling and high competition for raw materials can cause shortages, impacting operating capacity, and may have a material adverse effect on our results of operations and financial condition.

Growth of our EcoLoopX platform depends in part on the development of battery recycling and circular economy markets.

The infrastructure for end-of-life battery collection and reverse logistics is underdeveloped, making it difficult to secure a steady, high-volume supply of feedstock for recycling facilities. In addition, battery recycling is a process-heavy, capital-intensive industry, with costs for storage, transportation, and specialized handling often exceeding the value of the recovered materials. The ability to grow of our EcoLoopX platform depends in part on the development of battery recycling and circular economy markets.

AI Services

Our AI powered big data platform will operate in an industry characterized by rapid technological change, unpredictable market adoption, and an intensely uncertain regulatory landscape, which together expose us to significant legal and financial risks.

The market for big date and artificial intelligence infrastructure is in an early stage of development and is subject to profound and rapid shifts. We cannot predict whether broad-based commercial adoption of our AI platform hub will materialize, or if new, disruptive innovations will render our intended services outdated before we can achieve profitability.

Beyond the highly complex network of current data privacy and intellectual property laws, we face great uncertainty regarding future legislative frameworks. Lawmakers globally are still continuously debating and proposing fragmented new regulations governing data and AI safety, algorithmic bias, data provenance, and the ethical deployment of machine learning models. We cannot forecast how these evolving legal standards will be interpreted or enforced. Any new development in regulations may dramatically restrict our operations or exponentially increase our compliance costs.

Furthermore, the deployment of AI involves inherent and unknown operational limitations. AI models are susceptible to generating inaccurate information, or “hallucinations”, exhibiting unintended biases, and exposing vulnerabilities in cybersecurity and data protection. If our platform, or the third-party models we may rely upon, yields flawed, biased, or harmful outputs, we could face severe reputational damage, consumer protection litigation, and heightened regulatory scrutiny. If we fail to successfully manage these technological, ethical, and regulatory uncertainties, our business, financial condition, and results of operations will be materially adversely affected.

Our common stock may be subject to extreme volatility that is seemingly unrelated to the underlying performance of our business. In particular, our common stock may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices, given that we have relatively small public floats. Such volatility, including any stock-run up, may be unrelated to our actual or expected operating performance, financial condition or prospects.

Holders of our common stock may also not be able to readily liquidate their investment or may be forced to sell at depressed prices due to low volume trading. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of our common stock. As a result of this volatility, investors may experience losses on their investment in our common stock. Furthermore, the potential extreme volatility may confuse the public perception of the value of our stock, distort the market perception of our stock price, our company’s financial performance, public image, and negatively affect the long-term liquidity of our common stock, regardless of our actual or expected operating performance. If we encounter such volatility, including any rapid stock price increases and declines seemingly unrelated to our actual or expected operating performance and financial condition or prospects, it will likely make it difficult and confusing for prospective investors to assess the rapidly changing value of our common stock and understand the value thereof.

Volatility in our common stock price may subject us to securities litigation.

Stock markets, in general, have experienced, and continue to experience, significant price and volume volatility, and the market price of our common stock may continue to be subject to similar market fluctuations unrelated to our operating performance or prospects. This increased volatility, coupled with depressed economic conditions, could have a depressing effect on the market price of our common stock.

In addition, the securities markets have, from time to time, experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. Any of these factors could result in large and sudden changes in the volume and trading price of our common stock and could cause our stockholders to incur substantial losses. In the past, following periods of volatility in the market price of a company’s securities, stockholders have often instituted securities class action litigation against that company. If we were involved in a class action suit or other securities litigation, it would divert the attention of our senior management, require us to incur significant expense and, whether or not adversely determined, have a material adverse effect on our business, financial condition, results of operations and prospects.

We have failed to comply with the continued listing requirements of Nasdaq, our common stock may be delisted and the price of our common stock and our ability to access the capital markets could be negatively impacted.

On January 29, 2026, we received a written notice from the staff of the Listing Qualifications Department of Nasdaq (the “Staff”) that for 30 consecutive business days from December 15, 2025 to January 28, 2026, the closing bid price of our common stock listed on the Nasdaq Capital Market was below $1.00 and no longer meets the minimum bid price requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rules 5550(a)(1), which requires a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”). On July 10, 2026, the Company received a letter from Nasdaq, notifying the Company that the Staff had determined that for the last 10 consecutive business days, from June 25, 2026 to July 9, 2026, the closing bid price of the Company’s common stock has been at $1.00 per share or greater and, accordingly, that the Company had regained compliance with the Minimum Bid Price Requirement for continued listing on Nasdaq.

There can be no assurance that we will maintain compliance with the applicable continued listing standards set forth in the Nasdaq Listing Rules. Delisting from Nasdaq could make trading our common stock more difficult for investors, potentially leading to declines in our share price and liquidity. In the event we are delisted from Nasdaq, the only established trading market for our common stock would be eliminated, and we would be forced to list our shares on the OTC Markets or another quotation medium, depending on our ability to meet the specific listing requirements of those quotation systems. As a result, an investor would likely find it more difficult to trade or obtain accurate price quotations for our shares. Delisting would likely also reduce the visibility, liquidity, and value of our common stock, reduce investor interest in our company, and may increase the volatility of our common stock. Delisting could also cause a loss of confidence of potential industry partners, lenders, and employees, which could further harm our business and our future prospects.

We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future. As a result, you may only receive a return on your investment in our common stock if the market price of our common stock increases.

If securities or industry analysts do not publish research or reports about our business, or if they publish a negative report regarding our shares of common stock, the price of our common stock and trading volume could decline.

The trading market for our common stock may depend in part on the research and reports that industry or securities analysts publish about us or our business. We do not have any control over these analysts. If one or more of the analysts who cover us downgrade us, the price of our common stock would likely decline. If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause the price of our common stock and the trading volume to decline.

The market price of our common stock may be volatile or may decline regardless of our operating performance, and you may not be able to resell your shares at or above your purchase price.

Our management has broad discretion to determine how to use the funds raised in our offeringd and may use them in ways that may not enhance our results of operations or the price of our shares of common stock.

We anticipate that we will use the net proceeds from our offerings along with our existing cash and cash equivalents, to fund enhancements to our current supply chain management as well as the development of additional functionalities of our business expansion, expansion of sales and distribution channels in order to reach a broader customer base, talent development and retention, as well as for working capital and other general corporate purposes. Our management will have significant discretion as to the use of the net proceeds to us from our IPO and could spend the proceeds in ways that do not improve our results of operations or enhance the market price of our shares of common stock.

As a “controlled company” within the meaning of the Nasdaq Marketplace Rule 5615(c), we have chosen to exempt our Company from certain corporate governance requirements that could have an adverse effect on our public stockholders.

Our chairperson, chief executive officer, and President, Ms. Yin Yan, controls approximately 93.93% of the aggregate voting power of our outstanding voting securities, assuming no exercise of the over-allotment option (or 93.74% assuming full exercise of the over-allotment option), and we will be deemed a “controlled company” within the meaning of the listing rules of the Nasdaq Capital Market. A “controlled company” may elect to rely on certain exemptions from corporate governance rules, including an exemption from the rule that a majority of our board of directors must be independent directors. These independence standards are intended to ensure that directors who meet those standards are free of any conflicting interest that could influence their actions as directors. We intend to rely on the “controlled company” exemptions under the Nasdaq Marketplace Rule 5615(c), and our nominating and corporate governance and compensation committees will not consist entirely of independent directors. Accordingly, our stockholders do not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the Nasdaq Marketplace Rules.

Our status as a controlled company could cause our shares of common stock to be less attractive to certain investors or otherwise harm our trading price. As a result, you would not have the same protection afforded to stockholders of companies that are subject to these corporate governance requirements.

Anti-takeover provisions in our charter documents and Nevada law, along with our status as a “controlled company,” could discourage, delay or prevent a change in control of our company and may affect the trading price of our common stock.

We are a Nevada corporation and the anti-takeover provisions of the Nevada Revised Statutes may discourage, delay, or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change in control would be beneficial to our existing stockholders. An interested stockholder is a person who, together with the affiliates and associates, beneficially owns (or within the prior two years, did beneficially own) ten percent or more of the Company’s capital stock entitled to vote.

In addition, our Amended and Restated Articles of Incorporation (“Articles of Incorporation”) and Second Amended and Restated Bylaws (“Bylaws”) may discourage, delay, or prevent a change in our management or control over us that stockholders may consider favorable. Our Articles of Incorporation and our Bylaws (i) authorize the issuance of “blank check” preferred stock that could be issued by our Board to thwart a takeover attempt; (ii) provide that vacancies on our Board, including newly created directorships, may be filled by a majority vote of directors then in office, and (iii) provide that the Board shall have the power to amend, modify or repeal the Bylaws.

Further, we are a “controlled company” as defined in the Nasdaq Marketplace Rule 5615(c) because more than 50% of the combined voting power of all of our outstanding common stock is beneficially owned by Ms. Yin Yan. Our status as a controlled company may have an anti-takeover effect of delaying, deferring or preventing a change in control of the Company.

We have 135,000 shares of Series A Super Voting Preferred Stock with super voting rights.

Our capital stock as of the date hereof consists of common stock and Series A Super Voting Preferred Stock. All 135,000 shares of Series A Super Voting Preferred Stock have been issued to Ms. Yin Yan, our chairperson, chief executive officer, and President. Each share of common stock is entitled to one (1) vote and each share of Series A Super Voting Preferred Stock is entitled to one thousand (1,000) votes on any matter on which action of the stockholders of the corporation is sought. Approximately 95.75% of Ms. Yin Yan’s voting power stems from her holdings of the Series A Super Voting Preferred Stock. The Series A Super Voting Preferred Stock will vote together with the common stock.

Our Articles of Incorporation does not provide for any sunset provisions that limit the lifespan of our Series A Super Voting Preferred Stock, including in the case of the death of a Series A Super Voting Preferred Stock shareholder or intra-family transfers of shares of Series A Super Voting Preferred Stock. The holders of Series A Super Voting Preferred Stock shall not be entitled to receive dividends of any kind or be entitled to any liquidation preference. The Series A Super Voting Preferred Stock shall not be subject to conversion into common stock or other equity authorized to be issued by the Company. The Series A Super Voting Preferred Stock is redeemable at the election of the holder at a redemption price of $0.001 per share. See “Description of Capital Stock” for additional information regarding our Series A Super Voting Preferred Stock.

In addition to the dilutive effect on the voting power and value of our common stock, the foregoing structure of our capital stock may render our common stock ineligible for inclusion in certain securities market indices, and thus adversely affect the price and liquidity of, and public sentiment regarding, our common stock or other securities.

The existence of, and voting rights associated with, our Series A Super Voting Preferred Stock, either alone or in conjunction with certain of the other provisions of our Articles of Incorporation, such as the requirement to have a staggered board, could also have the effect of delaying, deterring or preventing a change in our control or make the removal of our management more difficult.

We cannot predict the impact our multi-class share structure may have on the stock price of our common stock*.*

We are an “emerging growth company,” as defined in the JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of certain exemptions and relief from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including (i) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, (ii) having the option of delaying the adoption of certain new or revised financial accounting standards, (iii) reduced disclosure obligations regarding executive compensation in our registration statement and our periodic reports and proxy statements and (iv) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We may take advantage of these exemptions until such time that we are no longer an emerging growth company. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold stock. Further, pursuant to Section 107 of the JOBS Act, we have elected to take advantage of the extended transition period for complying with new or revised accounting standards until those standards would otherwise apply to private companies. As a result, our operating results and financial statements may not be comparable to the operating results and financial statements of other companies who have adopted the new or revised accounting standards.

We will remain an emerging growth company until the earliest of (i) April 30, 2030, (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the last day of the fiscal year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock held by non-affiliates was $700.0 million or more as of the last business day of the second fiscal quarter of such year or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

If we fail to implement and maintain an effective system of internal controls or fail to remediate the material weaknesses in our internal control over financial reporting that have been identified, we may fail to meet our reporting obligations or be unable to accurately report our results of operations or prevent fraud, and investor confidence and the market price of our common stock may be materially and adversely affected.

Prior to our IPO, we were a private company with limited accounting personnel and other resources with which to address our internal controls and procedures. Our management has not completed an assessment of the effectiveness of our internal controls over financial reporting, and our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting. In the course of auditing our consolidated financial statements for the years ended April 30, 2024 and 2023, we identified several material weaknesses in our internal control over financial reporting and other control deficiencies as of April 30, 2024. A “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses identified to date relate to (i) a lack of accounting staff and resources with appropriate knowledge of generally accepted accounting principles in the United States (“U.S. GAAP”) and SEC reporting and compliance requirements; (ii) a lack of sufficient documented financial closing policies and procedures and (iii) a lack of an effective review process by the accounting manager which may lead to material audit adjustments to the financial statements.

Following the identification of the material weaknesses and control deficiencies, we plan to take remedial measures including (i) hiring more qualified accounting personnel with relevant U.S. GAAP and SEC reporting experience and qualifications to strengthen the financial reporting function and to set up a financial and system control framework; (ii) implementing regular and continuous U.S. GAAP accounting and financial reporting training programs for our accounting and financial reporting personnel; (iii) setting up an internal audit function as well as engaging an external consulting firm to assist us with the assessment of Sarbanes-Oxley compliance requirements and improvement of overall internal control; and (iv) appointing independent directors and strengthening corporate governance.

However, the implementation of these measures may not fully address the material weaknesses in our internal control over financial reporting. Our failure to correct the material weaknesses or our failure to discover and address any other material weaknesses or control deficiencies could result in inaccuracies in our financial statements and could also impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis. As a result, our business, financial condition, results of operations, and prospects, as well as the trading price of our Common stock, may be materially and adversely affected. Moreover, ineffective internal control over financial reporting significantly hinders our ability to prevent fraud.

We are a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act of 2002 will require that we include a report of management on our internal control over financial reporting in our annual report on Form 10-K beginning with our annual report for the fiscal year ending April 30, 2026. However, our auditors will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 until we are no longer a smaller reporting company. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified, if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated, or reviewed, or if it interprets the relevant requirements differently from us. In addition, after we become a public company, our reporting obligations may place a significant strain on our management, operational, and financial resources and systems for the foreseeable future. We may be unable to complete our evaluation testing and any required remediation in a timely manner.

Our management and principal stockholders own a significant percentage of our stock and will be able to exert control over matters subject to stockholder approval.

Our chairperson, chief executive officer, and President, Ms. Yin Yan, controls approximately 90.85% of the aggregate voting power of our outstanding voting securities.

Approximately 95.75% of Ms. Yin Yan’s voting power stems from her holdings of the Series A Super Voting Preferred Stock. To the extent that Ms. Yan continues to own a significant percentage of the voting power of our common stock, Ms. Yan will be able to control the management and affairs of our company and most matters requiring stockholder approval, including the election of directors, amendments of our organizational documents and approval of any merger, sale of substantially all our assets or other significant corporate transactions. This concentration of ownership may prevent or discourage unsolicited acquisition proposals or offers for our common stock that you or other stockholders may feel are in your or their best interest as one of our stockholders.

Our board of directors has the authority, without stockholder approval, to issue preferred stock with terms that may not be beneficial to common stockholders and with the ability to affect adversely stockholder voting power and perpetuate their control over us.

Our Articles of Incorporation allow us to issue shares of preferred stock without any vote or further action by our stockholders. Our board of directors has the authority to fix and determine the relative rights and preferences of preferred stock. As a result, our board of directors could authorize the issuance of a series of preferred stock that would grant to holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption of the shares, together with a premium, prior to the redemption of our common stock.

We are subject to the periodic reporting requirements of Section 15(d) and 12(b) of the Exchange Act that require us to incur audit fees and legal fees in connection with the preparation of such reports. These additional costs could reduce or eliminate our ability to earn a profit.

We are required to file periodic reports with the SEC pursuant to the Exchange Act and the rules and regulations promulgated thereunder. In order to comply with these requirements, our independent registered public accounting firm will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will have to review and assist in the preparation of such reports. The costs charged by these professionals for such services cannot be accurately predicted at this time because factors such as the number and type of transactions that we engage in, and the complexity of our reports cannot be determined at this time and will affect the amount of time to be spent by our auditors and attorneys. However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit.

The costs of maintaining public company reporting requirements could be significant and may preclude us from seeking financing or equity investment on terms acceptable to us and our stockholders. We estimate these costs to be in excess of $500,000 per year and may be higher if our business volume or business activity increases significantly. If our revenues are insufficient or non-existent, or we cannot satisfy many of these costs through the issuance of shares or debt, we may be unable to satisfy these costs in the normal course of business.

However, for as long as we remain a smaller reporting company, as defined in Item 10(f)(1) of Regulation S-K, we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not smaller reporting companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, reduced financial statement disclosure in registration statements, which must include two years of audited financial statements, reduced financial statement disclosure in annual reports on Form 10-K, and exemptions from the auditor attestation of management’s assessment of internal control over financial reporting. We may take advantage of these reporting exemptions until we are no longer a smaller reporting company.

If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantly.