Onfolio Holdings, Inc

Previous wording

We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year following the fifth anniversary of our initial public offering, (ii) the last day of the first fiscal year in which our total annual gross revenues are $1.07 billion or more, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iv) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.

Current wording

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

Previous wording

The Company reported a net loss of $806,428 for the three months ended March 31, 2025 compared to a net loss of $477,826 for the three months ended March 31, 2024. The components of the increase in net loss for the current period are as follows:

Current wording

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

Previous wording

Cost of revenue increased by $522,257, or 90% due to the Company’s recent acquisitions which increased cost of service revenue, partially offset by a reduction in cost of product sales revenue. This reduction was driven by a strategic shift in the Company’s marketing approach for certain subsidiaries, emphasizing advertising (recorded under operating expenses), and reducing reliance on affiliate sales (recorded under cost of revenue). Lower product sales from the Mighty Deals and Vital Reaction subsidiaries also contributed to the offset. The Company’s gross profit margins decreased slightly in the current period compared to the prior period. The components most significant to the Company’s cost of revenue are the costs of labor for service fulfillment, content creation, website hosting and maintenance costs and the costs of acquiring new inventory products for physical product sales.

Current wording

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

Previous wording

Professional fees increased by $57,715, or 32% during the three months ended March 31, 2025 compared to 2024 primarily due to increased legal and accounting costs associated with the Company’s compliance requirements as a public company. The Company also incurred $33,410 in acquisition costs during the three months ended March 31, 2025 compared to $94,341 during 2024, which included due diligence, audit, legal and other professional fees related to acquisitions and potential acquisitions. We expect acquisition costs to remain significant as we continue to grow based on acquisitions.

Current wording

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

Previous wording

Total other expense was $38,405 during the three months ended March 31, 2025, compared to other expense of $22,447 during 2024. The increase in other income was driven by an increase in interest expense from increased loan balances.

Current wording

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

Previous wording

B2B revenue increased by $1,015,792 or 150% during the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase is primarily due to revenue from our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024, which increased revenue by approximately $52,500, and our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024, which increased revenue by approximately $917,500.

Current wording

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

Previous wording

B2B total operating income decreased by $177,770 or 140% during the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease was a result of the increased revenue and gross profit offset by the increase in intangible asset amortization for the newly acquired businesses in the year ended 2024.

Current wording

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

Previous wording

B2C revenue increased by $209,249 or 23% during the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase is primarily due to an increase in digital product sales within the Company’s Proofread Anywhere subsidiary.

Current wording

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

Previous wording

B2C incurred total operating income of $228,158 during the three months ended March 31, 2025 compared to an operating income of $153,759 during the three months ended March 31, 2024, primarily due to the increase in sales from the Proofread Anywhere subsidiary.

Current wording

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

Previous wording

Revenue increased by $1,225,041, or 77% for the three months ended March 31, 2025 compared to 2024. The increase is primarily due to revenue from our Eastern Standard acquisition completed during the fourth quarter of fiscal 2024, which increased revenue by approximately $917,500 and our DDS Rank acquisition completed at the end of the second quarter of fiscal 2024, which increased revenue by approximately $52,500. In addition, our digital product sales increased by approximately $230,000 under our Proofread anywhere subsidiary as a result of a change in business marketing strategy.

Current wording

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

Previous wording

General and Administrative expenses increased by $1,036,163, or 87% during the three months ended March 31, 2025 compared to 2024. The increase was primarily due to an increase in advertising and marketing costs of $328,000, an increase in stock-based compensation expense of $255,000, increase in contractor and compensation costs of $142,000, increase in other general and administrative costs of $135,000, including travel and merchant fees, and an increase in amortization expenses of $176,000 associated with the acquired intangible assets not present in the comparable period.

Current wording

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

Previous wording

Our primary source of operating cash inflows are payments from portfolio companies. In addition, the Company has raised $1,300,000 pursuant to a private offerings of Series A preferred stock through March 31, 2025, $618,000 in notes payable and repaid $2,164,498 on its acquisition notes.

Current wording

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

Previous wording

Net cash used in operating activities was $145,049 and $431,007 for the three months ended March 31, 2025 and 2024, respectively. The decrease was primarily from the increase in revenues and decreased general and administrative costs as the Company expanded its operations through its business acquisitions in the past year.

Current wording

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

Previous wording

Net cash used in investing activities was $0 and $250,000 for the three months ended March 31, 2025 and 2024, respectively. The cash used in investing activities was primarily for the purchase of businesses in the prior period and additional cost method investments.

Current wording

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

Previous wording

Cash flows provided by financing activities was $297,831 for the three months ended March 31, 2025 compared to cash provided by financing activities of $264,135 during the three months ended March 31, 2024. During the 2025 period, we received $700,000 in proceeds from sales of Series A preferred stock and we paid $99,250 in dividends to preferred stockholders, made payments totaling $176,624 on notes payable, made payments totaling $108,475 related to contingent consideration and made distributions totaling $17,820 to our non-controlling interest holders. During the 2024 period, we received $350,000 in proceeds from notes payable and we paid $70,122 in dividends to preferred stockholders and made payments totaling $25,743 on notes payable

Current wording

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

Previous wording

RevenueZen Acquisition: The Company has determined the final amount obligated to pay to the sellers of RevenueZen, contingent upon the business achieving a specified gross profit threshold within one year to be $680,662. On February 28, 2025, the Company and the RevenueZen sellers agreed to the final earn-out amount to be $682,000 and modified the payment terms to be paid with a cash payment of $72,000, $100,000 to be paid through profit sharing by using 30% of Net Operating Income, $100,000 in value for $79,240 stock options to purchase shares of common stock, $70,000 in Series A preferred stock, and $340,000 in a promissory note. The promissory note, has a term of 60 months and accrues interest at 19%. The stock options have an exercise price of $1.34, have a term of 10 years, and are vested immediately. As of March 31, 2025, the Company estimated the remaining obligations owed under the revenue share obligation to be $100,000,

Current wording

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

Previous wording

First Page Acquisition: The Company agreed to pay a revenue share amount equal to 18% of gross revenues for the acquired customers for 3 years following the acquisition date. As of March 31, 2025, the Company estimated the remaining obligations owed under the revenue share provisions to be $148,943 resulting in a change in the fair value of the continent consideration of $55,511.

Current wording

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