Verde Resources (VRDR) logs $460K Q3 sales and narrows net loss
Rhea-AI Filing Summary
Verde Resources, Inc. reports a sharp jump in activity for the quarter ended March 31, 2026. Revenue reached $460,005, up from $697 a year earlier, driven largely by initial product sales to Ergon under a 10‑year licensing deal for its Verde V24 biochar asphalt emulsifying agent. Despite higher revenue, the company posted a quarterly net loss of $513,069, narrower than the prior‑year loss of $1,146,380, reflecting continued investment in commercialization and R&D. Cash and cash equivalents increased to $2,129,576, supported by $2,448,000 in common stock issuance over nine months, while total liabilities remained modest at $936,077 against total assets of $38,939,962. Verde also advanced its carbon credit and technology strategy through agreements with C‑Twelve, Puro.earth, Isometric, Biochar Solutions, and the creation of a Singapore subsidiary to lead Asia‑Pacific expansion.
Positive
- None.
Negative
- None.
Insights
Verde shows first meaningful sales but remains loss-making.
Verde Resources generated quarterly revenue of $460,005, a major step up from prior minimal sales, mainly from its Verde V24 supply to Ergon under a 10‑year exclusive license across the U.S., Canada and Mexico. This begins to validate its commercial model around biochar asphalt.
The company still recorded a net loss of $513,069 for the quarter and a nine‑month loss of $2,366,700, while funding operations with equity, raising $2,448,000 via common stock. Liabilities are relatively low at $936,077, but the business depends on scaling revenue to cover operating expenses.
Key strategic moves include expanding rights under the C‑Twelve Agreement, the long‑term Ergon License, carbon credit arrangements with Puro.earth and Isometric, and establishing a Singapore subsidiary on March 30, 2026 to support Asia‑Pacific growth. Future filings will clarify whether Ergon purchase volumes and carbon credit monetization materially accelerate revenue.
Key Figures
Key Terms
Verde Net Zero Blueprint financial
carbon removal credits financial
Ergon License financial
C-Twelve Agreement financial
right of use assets financial
expected credit losses financial
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
OR
| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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| Title of Each Class: | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||
| None | None | None |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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| Large accelerated filer | ☐ | Accelerated filer | ☐ | |
| ☒ | Smaller reporting company | |||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Yes
As of May 12, 2026, there were shares of common stock outstanding.
VERDE RESOURCES, INC.
TABLE OF CONTENTS
| Page | ||
| Cautionary Note Regarding Forward-Looking Statements | iii | |
| Key Definitions | iii | |
| PART I - FINANCIAL INFORMATION | ||
| Item 1. | Financial Statements | F-1 |
| Unaudited Condensed Consolidated Balance Sheets as of March 31, 2026 and June 30, 2025 (audited) | F-1 | |
| Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended March 31, 2026 and 2025 | F-2 | |
| Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended March 31, 2026 and 2025 | F-3 | |
| Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and nine months ended March 31, 2026 and 2025 | F-4 | |
| Notes to Unaudited Condensed Consolidated Financial Statements | F-6 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 1 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 11 |
| Item 4. | Controls and Procedures | 11 |
| PART II - OTHER INFORMATION | ||
| Item 1. | Legal Proceedings | 11 |
| Item 1A. | Risk Factors | 12 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 12 |
| Item 3. | Defaults upon Senior Securities | 12 |
| Item 4. | Mine and Safety Disclosure | 12 |
| Item 5. | Other Information | 12 |
| Item 6. | Exhibits | 13 |
| ii |
| Table of Contents |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the “Quarterly Report”), and any documents we incorporate by reference, contain, or may contain, certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and other applicable rules and regulations. Such forward-looking statements involve significant risks and uncertainties. All statements contained in this Quarterly Report and any documents we incorporate by reference, other than statements of historical facts, are forward-looking statements including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
The words “may,” “will,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “potential,” “seek,” “aim,” “goal” and derivatives of such words or similar expressions regarding the future are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements include statements regarding, and important factors that could cause actual outcomes to differ materially from those stated or implied in the forward-looking statements include, but are not limited to, the matters summarized below:
| ● | our ability to establish and implement our business plan and begin to generate revenues, including through our Verde Net Zero Blueprint licensing and distribution model strategy and in conjunction with key commercial partners like Ergon Asphalt & Emulsions, Inc. (“Ergon”); | |
| ● | our expectations about the anticipated benefits of our Verde Net Zero Blueprint licensing and distribution model strategy and our relationship with Ergon; | |
| ● | the expected benefits of our proprietary road construction materials, including the cold mix biochar asphalt emulsifying agent we have licensed to Ergon for use in its products in North America; | |
| ● | our ability to generate and monetize carbon renewal credits utilizing our technology and products; | |
| ● | our ability to effectively compete in our industry and execute on our business plan; | |
| ● | the impact of governmental laws and regulation, and our ability to comply with new regulations and compliance requirements that affect our business; | |
| ● | our ability to effectively scale our operations in North America and other regions, either on our own or through third-party collaborators like Ergon and others; | |
| ● | our ability to adequately market our products and services, and to develop additional products and product offerings; | |
| ● | our ability to successfully expand our operations into foreign markets; | |
| ● | assumptions related to the size of the market for our products and solutions; | |
| ● | our future capital needs and our ability to raise additional capital; | |
| ● | our ability to expand our licensing and distribution model to third parties beyond Ergon; | |
| ● | our ability to expand our revenue streams beyond our licensing and distribution model; | |
| ● | difficulties with certain licensees (such as Ergon), licensors from whom we have the rights to key intellectual property, or other third parties upon which we rely; | |
| ● | our ability to attract, develop, and retain capable key personnel; | |
| ● | our ability to protect our intellectual property (including our trade secrets) or manage threats posed by breaches of security; and | |
| ● | other risks and uncertainties, including those listed in the “Risk Factors” section of this Quarterly Report, and our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, filed with the Securities and Exchange Commission (“SEC”) on October 23, 2025. |
These and other forward-looking statements are only predictions and we may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, so you should not place undue reliance on our forward-looking statements, which speak only as of the date of this Quarterly Report or, in the case of exhibits hereto, the date of those documents. In addition, the factors listed above may not be the only ones that impact our ability to achieve the results anticipated by our forward-looking statements. Actual results or events could differ materially and adversely from the plans, intentions and expectations disclosed in the forward-looking statements we make. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. You are cautioned that forward-looking statements involve significant risks and uncertainties that are subject to change based on various factors (many of which are beyond our control). We have included important factors in the cautionary statements included in this Quarterly Report that could cause actual future results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.
You should read this Quarterly Report and the documents that we incorporate by reference with the understanding that our actual future results may be materially different from what we expect. All subsequent written or oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this Quarterly Report or to reflect the occurrence of unanticipated events, except as may be required under applicable U.S. securities law. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.
KEY DEFINITIONS
Unless the context requires otherwise, references in this Quarterly Report to “we,” “us,” “our,” “the Company,” “Verde,” or similar terminology refer to Verde Resources, Inc. and its consolidated subsidiaries
Unless the context requires otherwise, references in this Quarterly Report to “common stock” refer to the Company’s common stock, par value $0.001 per share.
| iii |
| Table of Contents |
PART I - FINANCIAL INFORMATION
ITEM 1 - Financial Statements
VERDE RESOURCES, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Currency expressed in United States Dollars (“US$”), except for number of shares)
March 31, 2026 | June 30, 2025 | |||||||
| ASSETS | Audited | |||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Short-term investments | ||||||||
| Accounts receivable | ||||||||
| Inventories | ||||||||
| Amount due from related party | ||||||||
| Prepaid share-based compensation-nonemployees | ||||||||
| Prepayments | ||||||||
| Other receivables and deposits | ||||||||
| Assets held for sale | ||||||||
| Total current assets | ||||||||
| Non-current assets: | ||||||||
| Property, plant and equipment, net | ||||||||
| Right of use assets, net | ||||||||
| Intangible assets | ||||||||
| Deposits paid | ||||||||
| Prepaid share-based compensation- nonemployees | ||||||||
| Total non-current assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Other payables | ||||||||
| Deposit and accrued liabilities | ||||||||
| Accrued share-based compensation for nonemployee | ||||||||
| Accrued share-based compensation for employee | ||||||||
| Current portion of operating lease liabilities | ||||||||
| Amount due to a director | ||||||||
| Amounts due to related parties | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities: | ||||||||
| Operating lease liabilities, net of current portion | ||||||||
| Total non-current liabilities | ||||||||
| TOTAL LIABILITIES | ||||||||
| Commitments and contingencies | ||||||||
| STOCKHOLDERS’ EQUITY | ||||||||
| Preferred stock, $ par value, shares authorized, -issued and outstanding | ||||||||
| Common stock, $ par value; shares authorized; and issued and outstanding as of March 31, 2026 and June 30, 2025 | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Non-controlling interest | ( | ) | ( | ) | ||||
| Stockholders’ equity | ||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | $ | ||||||
See accompanying notes to unaudited condensed consolidated financial statements.
| F-1 |
| Table of Contents |
VERDE RESOURCES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Currency expressed in United States Dollars (“US$”), except for number of shares)
Three months ended March 31, | Nine months ended March 31, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue, net | $ | $ | $ | $ | ||||||||||||
| Cost of revenue | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||
| Other operating expenses | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| LOSS FROM OPERATION | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ||||||||||||
| Rental income | ||||||||||||||||
| Gain from insurance claims | ||||||||||||||||
| Unrealized foreign exchange gain | ||||||||||||||||
| Gain on disposal of property, plant and equipment | ||||||||||||||||
| Gain on forgiveness of debts | ||||||||||||||||
| Interest income | ||||||||||||||||
| Other income (expense) | ( | ) | ||||||||||||||
| Total other income, net | ||||||||||||||||
| LOSS BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Income tax expense | ||||||||||||||||
| NET LOSS | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss attributable to non-controlling interest | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss attributable to Verde Resources Inc., shareholders | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||
| Other comprehensive loss: | ||||||||||||||||
| Foreign currency adjustment loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| COMPREHENSIVE LOSS | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss per share, basic and diluted | $ | $ | $ | $ | ||||||||||||
| Weighted average common stock outstanding, basic and diluted (revised) | ||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements.
| F-2 |
| Table of Contents |
VERDE RESOURCES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Currency expressed in United States Dollars (“US$”))
Nine months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| (revised) | ||||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation of property, plant and equipment | ||||||||
| Amortization | ||||||||
| Stock-based compensation-nonemployee | ||||||||
| Stock-based compensation-employee | ||||||||
| Stock-based compensation-director | ||||||||
| Finance cost interest element of promissory notes (non-cash) | ||||||||
| Operating lease expense | ||||||||
| Impairment on property | ||||||||
| Impairment on assets held for sale | ||||||||
| Gain on forgiveness of debts | ( | ) | ||||||
| Unrealized foreign exchange gain | ( | ) | ( | ) | ||||
| Gain from insurance claim | ( | ) | ||||||
| Loss from disposal of asset held for sale | ||||||||
| Gain on disposal of property, plant and equipment | ( | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ( | ) | ||||
| Other receivables (deposits) | ( | ) | ||||||
| Prepayments | ( | ) | ( | ) | ||||
| Inventories | ||||||||
| Accounts payables | ( | ) | ( | ) | ||||
| Accrued liabilities and other payables | ( | ) | ( | ) | ||||
| Advances (to) from director | ( | ) | ||||||
| Advances from (to) related parties | ( | ) | ||||||
| Repayment of operating lease liabilities | ( | ) | ( | ) | ||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Proceeds from disposal of assets held for sale | ||||||||
| Proceeds from disposal of property, plant and equipment | ||||||||
| Proceeds from insurance recoveries | ||||||||
| Withdrawal of short-term investments, net | ||||||||
| Purchase of property, plant and equipment | ( | ) | ||||||
| Net cash provided by investing activities | ||||||||
| Cash flows from financing activities: | ||||||||
| Repayments of lease liabilities | ( | ) | ||||||
| Repayments of bank loan | ( | ) | ||||||
| Proceeds from issuance of common stock | ||||||||
| Cash outflow arising from cancellation of common stock | ( | ) | ||||||
| Net cash provided by financing activities | ||||||||
| Net cash provided by operating, investing and financing | ||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||
| Net change in cash and cash equivalents | ||||||||
| CASH AND CASH EQUIVALENTS, AT BEGINNING OF PERIOD | ||||||||
| CASH AND CASH EQUIVALENTS, AT END OF PERIOD | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Cash paid for income taxes | $ | $ | ||||||
| Cash paid for interest | $ | $ | ||||||
| SUPPLEMENTAL NONCASH DISCLOSURE: | ||||||||
| Shares issuance for employee compensation | $ | $ | ||||||
| Promissory note to related party settled by Company’s common stock | $ | $ | ||||||
See accompanying notes to unaudited condensed consolidated financial statements.
| F-3 |
| Table of Contents |
VERDE RESOURCES, INC.
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF
CHANGES IN STOCKHOLDERS’
EQUITY
FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2026
(Currency expressed in United States Dollars (“US$”), except for number of shares)
| Common stock | Additional paid-in | Accumulated other comprehensive | Accumulated | Non controlling | stockholders’ | |||||||||||||||||||||||
No. of shares | Amount |
capital | loss |
losses |
interest | equity | ||||||||||||||||||||||
| Balance as of July 1, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||
| Shares issued for private placement | ||||||||||||||||||||||||||||
| Share based compensation to employee | - | - | - | - | - | |||||||||||||||||||||||
| Share based compensation to director | - | - | - | - | - | |||||||||||||||||||||||
| Shares issued to service provider | ||||||||||||||||||||||||||||
| Net loss for the period | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||
| Share based compensation to director | - | - | - | - | - | |||||||||||||||||||||||
| Shares issued to employee | ||||||||||||||||||||||||||||
| Shares issued to service provider | ||||||||||||||||||||||||||||
| Net loss for the period | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Balance as of March 31, 2026 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements.
| F-4 |
| Table of Contents |
VERDE RESOURCES, INC.
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF
CHANGES IN STOCKHOLDERS’
EQUITY (REVISED)
FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2025
(Currency expressed in United States Dollars (“US$”), except for number of shares)
| Common stock | Additional paid-in | Accumulated other comprehensive | Accumulated | Non controlling | Total stockholders’ | |||||||||||||||||||||||
No. of shares | Amount | capital | loss | losses | interest | equity | ||||||||||||||||||||||
| Balance as of July 1, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||
| Shares issued for private placement | ||||||||||||||||||||||||||||
| Shares issued to service provider | ||||||||||||||||||||||||||||
| Shares issued to employee | ||||||||||||||||||||||||||||
| Shares issued as settlement of promissory notes | ||||||||||||||||||||||||||||
| Share based compensation to employee | - | - | - | - | - | |||||||||||||||||||||||
| Shares cancelled | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
| Net loss for the period | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Balance as of December 31, 2024 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Shares issued for private placement | ||||||||||||||||||||||||||||
| Share based compensation to employee | - | - | - | - | - | |||||||||||||||||||||||
| Shares cancelled | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
| Net loss for the period | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | |||||||||||||||||||||||
| Balance as of March 31, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements.
| F-5 |
| Table of Contents |
VERDE RESOURCES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED MARCH 31, 2026 AND 2025
(Currency expressed in United States Dollars (“US$”), except for number of shares)
NOTE 1 - ORGANIZATION AND BUSINESS BACKGROUND
Core Business & Technology Overview
Verde Resources, Inc. was incorporated under the laws of the state of Nevada on April 22, 2010.
The Company is a road construction and building materials company offering proprietary, environmentally sustainable materials, designed to drive innovations that enhance sustainability and advance environmental stewardship. By integrating biochar, a carbon sequestering material and performance enhancer, the Company aims to facilitate the industry’s transition toward lower-emission infrastructure solutions. The Company believes its approach reduces greenhouse gas (“GHG”) emissions, optimizes the use of native soils and recycled materials, accelerates installation timelines, improves operational efficiency, and reduces overall project costs. The Company’s strategic focus has shifted toward the commercialization of its biochar asphalt technology through its wholly owned subsidiary, Verde Renewables Inc. (“Verde Renewables”). As part of this initiative, the Company has collaborated with the National Center for Asphalt Technology (“NCAT”) to deploy and evaluate its biochar asphalt technology at the NCAT test track. This endeavor is intended to validate the technology’s performance characteristics, environmental sustainability attributes, and potential to support the generation of carbon removal and avoidance credits.
Environmental Attributes and Carbon Credits
Puro.earth, a crediting platform for durable carbon removal, has officially registered the Company as a Carbon Removal Credit supplier as part of its Accelerate program. This registration was formalized through a platform agreement signed in April 2023. The Company’s endeavors are positioned to potentially create additional revenue opportunities through the generation of carbon removal credits (“CORCs”). The Company believes that the generation of CORCs and the demand for CORCs incentivizes the broader adoption of climate technologies and enables the Company to supply these credits to companies seeking to offset their carbon footprint in pursuit of net-zero objectives. Simultaneously, this approach creates the potential for an additional and substantial revenue stream for the Company.
In addition, on March 9, 2026, the Company engaged with Isometric (a leading certifier of carbon removal) in connection with the audit and verification of the Company’s BioFraction™ facility in Borneo to support the production of biochar and the potential generation of carbon removal credits associated with the use of engineered carbon in the Company’s road technologies. The Company views Isometric as a complementary carbon registry and methodology provider alongside Puro.earth and believes maintaining relationships with multiple registries may support future commercialization and expansion efforts across North America and other international markets.
Technology Development and Validation
On June 27, 2024, the Company entered into an agreement with NCAT at Auburn University to undertake a 3-year Performance Testing Project titled “Structural Capacity of Sustainable Pavement” (the “Project”). The Project, led by Dr. Nam Tran, Associate Director and Research Professor at NCAT, involved a comprehensive performance testing on the NCAT Test Track in Opelika, Alabama. This facility, sponsored by various state Departments of Transportation (DOTs) and in partnership with the Minnesota Road Research Facility (MnROAD), is dedicated to advancing sustainable pavement technologies. Success in this Project is expected to drive widespread adoption of a net-zero road construction blueprint by DOTs across the United States and the federal DOT. The Project commenced on June 24, 2024, and includes ongoing field demonstrations, performance evaluations and laboratory testing of the Company’s cold-mix BioAsphalt™ technologies at NCAT. The Project is expected to conclude on September 30, 2027, with the first draft of the final report expected in Spring 2027.
As part of the Project, in December 2024, in collaboration with C-Twelve Pty Ltd, a corporation incorporated in Western Australia (“C-Twelve”), the Company successfully demonstrated its biochar-asphalt technology utilizing C-Twelve’s proprietary emulsion at the NCAT test track in Auburn, Alabama. The Project showcased the ability to retrofit an existing asphalt plant to produce cold-mix biochar asphalt under winter conditions without the use of heat, solvents, or odors, resulting in an estimated 50% increase in installation efficiency compared to conventional methods.
The demonstration sequestered approximately eight (8) tons of carbon, verified and certified under Puro.earth in collaboration with Oregon Biochar Solutions, a related party of the Company through Karl Strahl, Chief Operating Officer of Oregon Biochar Solutions, who was appointed as a director of the Company in May 2025. This achievement marked what the Company believes to be the world’s first carbon removal credits generated through asphalt production and installation. The credits, issued and sold in April 2025, were pre-purchased by one of the world’s largest financial institutions focused on Carbon Dioxide Removals (“CDRs”). The Company refers to this integrated model of combining low-carbon materials, operational efficiency, and verified carbon removal credit generation as the “Verde Net Zero Blueprint.”
| F-6 |
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As part of the ongoing Project evaluation, in July 2025, the Company received encouraging preliminary performance results from NCAT regarding its BioAsphalt™ test section installed in December 2024 at NCAT’s Test Track. After approximately 50,000 equivalent single axle loads (ESALs) of heavy truck traffic, the asphalt surface remained flexible and demonstrated consistent durability, particularly under low-volume roadway conditions, as confirmed by NCAT’s Assistant Director for Test Track Research, Mr. Nathan Moore, providing early validation of the technology’s performance.
Further, as part of the Project, NCAT’s September 2025 evaluation of the Company’s cold recycling mix using 100% reclaimed asphalt pavement (“RAP”) further validated the results of its proprietary formulation. Laboratory testing conducted in accordance with ASTM D6927 (Marshall Stability and Flow), ASTM D6931 (Indirect Tensile Strength), and AASHTO T283 (Moisture Susceptibility) demonstrated that the Company’s cold-recycled mix not only meets but exceeds industry specifications for cold-recycled asphalt. Results showed superior cohesion, high tensile strength ratio (“TSR”), and retained stability compared to standard cold mix benchmarks, supporting its strength, durability, and moisture resistance. This demonstration represents the first deployment of a carbon sequestering asphalt material engineered to maintain competitive strength and flexibility for road applications.
Strategic Collaborations
On August 14, 2024, the Company entered into a Memorandum of Understanding (the “NPI MOU”) with Nature Plus Inc. (“NPI”) to formalize the collaboration on the NCAT Project referred to above and explore subsequent business opportunities arising from the successful completion of the Project. The Project involved the application of TerraZyme technology for the stability of subgrade and base layers, with the overarching goal of advancing road construction methodologies. The testing of the efficacy and exploration of potential applications of the TerraZyme technology at NCAT is still underway as of the date of this Quarterly Report.
Under the NPI MOU, the Company and NPI agreed to jointly develop mixed designs and materials incorporating biochar, aimed at enhancing performance and promoting carbon sequestration. The NPI MOU shall be effective until December 31, 2026, or until replaced by a subsequent distributor agreement. Upon the completion of the Project, if successful, the Company and NPI intend to continue the collaboration on future initiatives, including soil stabilization and material development, carbon removal credits, certification and compliance, and exclusive rights to distributing TerraZyme.
On October 16, 2024, the Company formed a new subsidiary, VerdePlus Inc. (“VerdePlus”), a Missouri corporation in partnership with NPI for the purpose of conducting business on the production of low-carbon building materials by integrating the Company’s expertise and the innovative intellectual property of NPI. The Company and NPI owned 55% and 45% of VerdePlus, respectively.
The Company’s current priority is the successful commercialization of its technology in North America, and if that commercialization is successful, the Company intends to introduce the same blueprint in Southeast Asia. Ongoing discussions with PLUS Malaysia, the country’s largest highway operator, as well as discussions with the Economic Development Board (“EDB”) and Land Transport Authority (“LTA”) of the Republic of Singapore, signal a growing demand for biochar in the region. This demand, coupled with the certification, could enable the Company’s BioFraction™ facility in Borneo to secure a reliable client and resume normal operations in Malaysia with the potential for significant scale-up over time.
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Licensing and Commercial Agreements
C-Twelve License
On October 18, 2024, the Company entered into a binding Term Sheet with C-Twelve granting the Company (i) an exclusive license to utilize C-Twelve’s proprietary binder and biochar asphalt mixed designs (the “Licensed Technology”) for the production and commercialization of asphalt surfacing-related products (the “End Products”) within the United States of America and (ii) the first right of refusal to extend the exclusive licensing of the Licensed Technology to other countries and territories subject to terms and conditions to be mutually agreed upon.
Subsequently on May 19, 2025, the Company and C-Twelve entered into a definitive agreement, namely the Joint Development Agreement (“C-Twelve Agreement”) which provides for a 10 year license commencing May 19, 2025.
Effective
October 8, 2025, the Company entered into an addendum to the C-Twelve Agreement (the “C-Twelve Addendum”) with C-Twelve pursuant
to which (i) C-Twelve approved the Company’s entry into the License Agreement with Ergon (as described below), (ii) the exclusive
territory granted to the Company under the C-Twelve Agreement is expanded to comprise the United States (including all states, territories,
and regions thereof), Canada and Mexico, (iii) the Company agreed to pay an additional $
Ergon License
On October 10, 2025, Verde Renewables entered into a license agreement with Ergon (the “Ergon License”), pursuant to which the Company granted Ergon an exclusive, non-transferable license to use, manufacture, commercialize, market, sell and distribute any product that contains or is manufactured or formed by Ergon using the Company’s proprietary cold mix biochar asphalt emulsifying agent, Verde V24, (which the Company exclusively licenses in North America from C-Twelve) in the United States (including its territories), Canada and Mexico, in exchange for Ergon agreeing to purchase Verde V24 from the Company at a fixed price (which is inclusive of all fees associated with the license, but subject to consumer price index adjustments) for use in Ergon’s asphalt road materials products.
The Company has agreed with Ergon to an initial fifteen (15) month “go-to-market period”, during which there will be no minimum purchase requirements for Ergon’s purchases of Verde V24. For each calendar year beginning January 1, 2027, Ergon has agreed to negotiate with the Company in good faith towards the establishment of possible minimum purchase amounts based on certain customary factors. The Company has also agreed with Ergon that if minimum purchase amounts are agreed to for any given calendar year, the Company and Ergon will agree in good faith to new minimum purchase amounts for each subsequent year, subject to consideration of customary factors.
The Company has also agreed to provide Ergon with forty percent (40%) of its share of the carbon removal credits generated from the mixing of the final carbon sequestering BioAsphalt™ surface material, so long as:
(a) the carbon removal credits are generated from bulk mixing or packaged mixed product, and
(b) the mixing of the final BioAsphalt™ surface material includes biochar purchased from the Company.
The Ergon License additionally grants Ergon the right to use the Company’s trademarks and access to ongoing technical services to facilitate the monitoring, reporting, and verification process of each ton of carbon dioxide sequestered.
The term of the Ergon License is ten (10) years, with an automatic renewal for additional ten (10) year periods, subject to a minimum of six (6) months’ notice of cancellation prior to renewal. The Ergon License may be terminated in the event of non-payment of amounts due, initiation of bankruptcy proceedings, or under other customary terms. Additionally, Ergon may terminate the Ergon License upon sixty (60) days’ prior written notice in the event that our Chief Executive Officer, Jack Wong, or our Chief Operating Officer, Eric Bava, are removed from their respective positions with the Company for reasons other than termination for cause or voluntary resignation.
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Biochar Solutions LLC
On March 14, 2026, Verde Renewables Inc., a wholly owned subsidiary of Verde Resources Inc., entered into a supply agreement with Biochar Solutions LLC to formalize and expand their existing collaboration into a structured commercial supply and intellectual property framework. Under this agreement, Biochar Solutions LLC will manufacture, supply, distribute, and white label engineered biochar for incorporation into Verde’s products, supporting both performance and carbon credit generation objectives. The agreement is intended to serve as the foundation for a binding long term commercial arrangement governing biochar supply, joint technology development, and carbon credit revenue sharing between the parties. Following an initial operating period, both parties intend to evaluate the commercial performance of the relationship and may update or modify the terms of the agreement based on operational experience and market conditions.
Commercial Activity
On February 10, 2026, the Company received its first two purchase orders from Ergon for the Company’s proprietary, licensed cold mix biochar asphalt emulsifying agent, Verde V24, the sale of which occurred during the quarter ending March 31, 2026. The gross revenue generated from these purchase orders was approximately $460,000 and the related receivable was fully collected from Ergon in April 2026. This event represents the Company’s first commercial transaction following the execution of its 10-year exclusive licensing agreement with Ergon in October 2025 and is the first step in the Company and Ergon’s combined go to market strategy for the Company’s cold mix BioAsphaltTM in North America.
Geographic Expansion
On March 30, 2026, the Company established Verde Resources Asia Pacific Pte. Ltd., a private company limited by shares incorporated under the laws of the Republic of Singapore and a wholly owned subsidiary of the Company. The subsidiary’s primary activity is research and experimental development in biotechnology (excluding medical sciences).The establishment of Verde Resources Asia Pacific Pte. Ltd. follows several months of discussions with the EDB and LTA of the Republic of Singapore and advances the Company’s previously stated strategy to license its Net Zero Blueprint and related technologies globally, beginning with Singapore as its Asia Pacific headquarters. This initiative is expected to support the future generation and trading of carbon removal credits and serve as a foundation for the Company’s expansion across the region.
Corporate Structure Changes
Pursuant
to an Intellectual Property Transfer Agreement dated October 15, 2025, Bio Resources Limited (“BRL”), a wholly owned subsidiary
of the Company, transferred to Verde Resources Asia Pacific Limited (“VRAP”), another wholly owned subsidiary of the Company,
all rights, title and interest in the intellectual property known as Catalytic Biofraction Process at its carrying value of $
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As of March 31, 2026, the Company has the following subsidiaries:
| Company name | Place of incorporation | Principal activities and place of operation | Effective interest held | ||||
| Verde Resources Asia Pacific Limited (“VRAP”) | |||||||
| Verde Resources (Malaysia) Sdn Bhd (“Verde Malaysia”) | |||||||
| Verde Renewables, Inc. | |||||||
| VerdePlus Inc. | |||||||
| Verde Life Inc. (“VLI”) | |||||||
| The Wision Project Sdn Bhd (“Wision”) | |||||||
| Verde Estates LLC (“VEL”) | |||||||
| Verde Resources Asia Pacific Pte. Ltd. (“VRAPPL”) |
* Bio Resources Limited (“BRL”), a former subsidiary of the Company, was administratively dissolved by being struck off the registers of the Labuan Financial Services Authority, effective October 19, 2025.
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NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying unaudited condensed consolidated financial statements and notes.
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements, which include the accounts of the Company and those of its wholly owned subsidiaries and variable interest entities, are unaudited and have been prepared on a basis substantially consistent with the Company’s audited financial statements and notes as of and for the year ended June 30, 2025 included in the Company’s Annual Report on Form 10-K (the “2025 Form 10-K”). These unaudited condensed consolidated financial statements are prepared in conformity with accounting principles generally accepted (“GAAP”) in the United States of America (“U.S. GAAP”) and follow the requirements of the SEC for interim reporting. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of adjustments of a normal and recurring nature) considered necessary for a fair statement of its financial position, operating results and cash flows for the periods presented. The condensed consolidated balance sheet at June 30, 2025 has been derived from audited consolidated financial statements, but does not contain all of the footnote disclosures from the 2025 Form 10-K. The results of the Company’s operations for any interim period are not necessarily indicative of the results of the Company’s operations for any other interim period or for a full fiscal year. The statements should be read in conjunction with the audited consolidated financial statements and related notes included in the 2025 Form 10-K as filed with SEC on October 23, 2025.
Use of Estimates and Assumptions
The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the years presented. Significant accounting estimates reflected in the Company’s condensed consolidated financial statements include the useful lives of plant and equipment, impairment of long-lived assets (including intangible assets), allowance for expected credit losses, revenue recognition, share based compensation, classification of warrants, deferred taxes and uncertain tax position.
The inputs into the management’s judgments and estimates consider the geopolitical tension, inflationary and high-interest rate environment and other macroeconomic factors on the Company’s critical and significant accounting estimates. Actual results could differ from these estimates.
Basis of Consolidation
The unaudited condensed consolidated financial statements include the financial statements of Verde Resources, Inc. and its subsidiaries. All significant inter-company balances and transactions within the Company and its subsidiaries have been eliminated upon consolidation. The Company accounts for acquisitions in accordance with guidance found in Accounting Standards Codification (“ASC”) 805, Business Combinations. The guidance requires consideration given, including contingent consideration, assets acquired, and liabilities assumed to be valued at their fair market values at the acquisition date.
Segment Reporting
During the fiscal year ended June 30, 2025, the Company reassessed its segment reporting conclusions in accordance with ASC Topic 280 and determined that it operates as a single operating and reportable segment. This reassessment reflects changes in how the business is managed and how financial information is reviewed by the Company’s Chief Operating Decision Maker (“CODM”).
The Company’s CODM is the Chief Executive Officer, who reviews financial information on a consolidated basis, including revenue, operating expenses and net income (loss), when evaluating operating performance and allocating resources. The CODM uses net income (loss) as the primary measure of performance and uses revenue as the primary measure for allocating resources.
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This conclusion reflects the increased integration of the Company’s operations, including centralized decision-making, shared resources, and alignment of strategic objectives across the organization. In prior periods, the Company had evaluated its operations as potentially comprising multiple segments based on earlier organizational structures and the CODM had used sales and operating income (loss) as the primary measures of segment profit or loss to assess performance and make resource allocation decisions. The CODM assessed those metrics and compared actuals to budgeted and forecasted values to evaluate segment operating performance and allocate resources to the operating segments.
As a result of these changes, management now evaluates performance and allocates resources on a consolidated basis.
This change did not impact the Company’s consolidated financial statements but may affect the comparability of segment-related disclosures between periods. See Note 4 – Business Segment Information for additional information.
Concentration of Credit Risk
The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents, short-term investments and accounts receivable. The Company maintains its cash and cash equivalents and short-term investments with high-credit-quality financial institutions. At times, such balances may exceed federally insured limits. The Company monitors the creditworthiness of financial institutions and counterparties and believes its exposure to credit risk is not significant.
Risks and Uncertainties
The Company’s operations in the supply of net zero road constructions and building materials are subject to significant risks and uncertainties, including financial, operational, technological, and other risks associated with a production operation for renewable commodities, including the potential risk of business failure.
Cash and Cash Equivalents
Cash
and cash equivalents are carried at cost and represent cash in banks, money market funds, which are readily convertible to known amounts
of cash and that mature within three months or less from the date of purchase, which, in the opinion of management, are subject to an
insignificant risk of loss in value. The Company had $
At March 31, 2026, and June 30, 2025, cash and cash equivalents consisted of petty cash on hand and cash in banks.
Short-Term Investments
Deposits held for investments that are not debt securities are included in short-term investments in the unaudited condensed consolidated balance sheets. Investments in short-term investments with original maturities of more than three months but remaining maturities of less than one year are considered short-term investments. Investments held with the intent to reinvest or hold for longer than a year, or with remaining maturities of one year or more, are considered long-term investments.
Accounts Receivable
Accounts
receivable are recognized and carried at amortized cost. The Company maintains an allowance for expected credit loss to provide for
the estimated number of receivables that will not be collected. The Company considers several factors in its estimate of the allowance,
including knowledge of a client’s financial condition, its historical collection experience, and other factors relevant to assessing
the collectability of such receivables. Bad debts are written off against allowances. An allowance for doubtful accounts will be recorded
in the period when a loss is probable based on an assessment of specific evidence indicating troubled collection, historical experience,
accounts aging, ongoing business relation and other factors. Accounts are written off after exhaustive efforts at collection. If accounts
receivable are to be provided for, or written off, they would be recognized in the unaudited condensed consolidated statement of operations
within operating expenses. As of March 31, 2026, and June 30, 2025, the longest credit term for certain customers are
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At
March 31, 2026, and June 30, 2025, there has been no allowance for expected credit loss for accounts receivable, and for other receivables,
the allowance for expected credit loss amounted to $
Expected Credit Loss
The Company accounts for expected credit losses in accordance with ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASC Topic 326 requires entities to use a current expected credit loss (“CECL”) methodology to estimate lifetime expected credit losses for certain financial assets measured at amortized cost, including accounts receivable and other financial instruments. The CECL methodology generally results in earlier recognition of credit losses than the previous incurred loss model.
The Company maintains an allowance for expected credit losses based on a combination of quantitative and qualitative factors, including historical loss experience, customer-specific credit risk, aging of receivables, current economic conditions and reasonable and supportable forecasts of future conditions.
Management applies significant judgment in identifying relevant risk factors, evaluating the impact of macroeconomic conditions, including inflation, interest rates and geopolitical uncertainty, and determining the appropriate expected loss rates. Changes in these assumptions or economic conditions could materially affect the timing and amount of credit loss provisions recognized in future periods.
Inventories
Inventories are stated at the lower of cost or market value (net realizable value), with cost being determined on a first-in-first-out method. Cost of raw materials include cost of materials and incidental costs in bringing the inventory to its current location. Costs of finished goods, on the other hand include material, labor and overhead costs. The Company provides inventory allowances based on excess and obsolete inventories determined principally by customer demand.
As of March 31, 2026, and June 30, 2025, there was no write down and no write off of inventories.
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:
Expected useful life | |
| Plant and machinery | |
| Office equipment | |
| Computers | |
| Motor vehicles | |
| Furniture and fittings | |
| Renovation |
The estimated useful lives and depreciation methodology reflect management’s judgment based on historical experience, the nature of the assets, anticipated usage, and technological and economic factors. The Company periodically reviews the estimated useful lives of its property, plant and equipment and revises such estimates when events or changes in circumstances indicate that the estimates may no longer be appropriate.
Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and improvements that substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets retired or sold are removed from the respective accounts, and any resulting gain or loss is recognized in the unaudited condensed consolidated statements of income (loss) and other comprehensive income (loss) in other income or expenses.
The Company also evaluates property, plant and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. See Note 8 for details of property, plant and equipment and related depreciation expense.
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Intangible Assets and Impairment of Long-Lived Assets
The Company accounts for intangible assets in accordance with ASC Topic 350, Intangibles—Goodwill and Other, and accounts for impairment of long-lived assets in accordance with ASC Topic 360, Impairment or Disposal of Long-Lived Assets.
Intangible assets acquired from third parties are initially measured at fair value. Indefinite-lived intangible assets are not amortized and are evaluated for impairment at least annually, or more frequently if events or changes in circumstances indicate that the asset may be impaired.
In accordance with ASC Topic 360, Impairment or Disposal of Long-Lived Assets, the Company evaluates long-lived assets, including property, plant and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability is assessed by comparing the carrying amount of the asset or asset group to the estimated undiscounted future cash flows expected to result from the use and eventual disposition of the asset. If the carrying amount exceeds the estimated undiscounted future cash flows, an impairment loss is recognized based on the excess of the carrying amount over the asset’s fair value.
To evaluate indefinite-lived intangible assets for impairment under ASC Topic 350, Intangibles—Goodwill and Other, the Company may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount. Alternatively, the Company may bypass the qualitative assessment and perform a quantitative impairment test. The qualitative assessment considers factors including business performance, market conditions, macroeconomic trends, strategic plans, recent market transactions and projected future cash flows.
If a quantitative assessment is performed, the fair value of the indefinite-lived intangible asset is compared to its carrying amount. Fair value is generally determined using discounted cash flow models, appraised values or other valuation techniques, as appropriate, and requires management to make significant estimates and assumptions, including projected revenues, operating margins, future cash flows and discount rates. If the carrying amount exceeds fair value, an impairment loss is recognized for the excess carrying value.
These estimates are inherently subjective and sensitive to changes in assumptions and market conditions. Actual results or changes in estimates could result in material impairment charges in future periods. See Note 9 for details of intangible assets and related impairment write offs.
Assets Held for Sale
The Company classifies assets as held-for-sale (“disposal group”) in the period when all of the relevant criteria to be classified as held for sale are met. These criteria include management’s commitment to sell the disposal group in its present condition and the sale being deemed probable of being completed within one year. Assets held for sale are reported at the lower of their carrying value or fair value less cost to sell. The fair values of disposal groups are estimated using accepted valuation techniques, including indicative listing prices. The Company considers historical experience, guidance received from third parties, and all information available at the time the estimates are made to derive fair value. Any loss resulting from the measurement is recognized in the period when the held for sale criteria are met. The Company assesses the fair value of a disposal group, less any costs to sell, each reporting period it remains classified as held for sale and reports any subsequent changes as an adjustment to the carrying value of the disposal group, as long as the new carrying value does not exceed the initial carrying value of the disposal group. Assets held-for-sale are not amortized or depreciated.
Revenue Recognition
The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC Topic 606”), which establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers.
The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfils its obligations under each of its agreements:
| ● | identify the contract with a customer; | |
| ● | identify the performance obligations in the contract; | |
| ● | determine the transaction price; | |
| ● | allocate the transaction price to performance obligations in the contract; and | |
| ● | recognize revenue as the performance obligation is satisfied. |
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Revenue is recognized when the Company satisfies its performance obligation under the contract by transferring the promised product to its customer that obtains control of the product and collection is reasonably assured. A performance obligation is a promise in a contract to transfer a distinct product or service to a customer. Most of the Company’s contracts have a single performance obligation, as the promise to transfer products or services is not separately identifiable from other promises in the contract and, therefore, not distinct. Accordingly, the transaction price is allocated in its entirety to the single performance obligation and recognized upon its fulfilment.
The Company considers customer order confirmations, whether formal or otherwise, to be a contract with the customer. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which the Company expects to be entitled.
The Company also follows the guidance provided in ASC 606, Revenue from Contracts with Customers, for determining whether the Company is the principal or an agent in arrangements with customers that involve another party that contributes to the provision of goods to a customer. In these instances, the Company determines whether it has promised to provide the goods itself (as principal) or to arrange for the specified goods to be provided by another party (as an agent). This determination is a matter of judgment that depends on the facts and circumstances of each arrangement. As such, the Company derives its revenue from the sale of products and services in its role as a principal.
Rental income
Rental income is recognized on a straight-line basis over the term of the respective lease agreement.
Cost of Revenue
Cost of revenue consists primarily of the cost of goods sold, which are directly attributable to the sales of products.
Leases
The Company determines if an arrangement is a lease or contains a lease at inception. Operating lease liabilities are recognized based on the present value of the remaining lease payments, discounted using the discount rate for the lease at the commencement date. The Company uses rate implicit in the lease to determine the present value of future lease payments to determine the present value of future lease payments. Operating lease right-of-use (“ROU assets”) assets represent the Company’s right to control the use of an identified asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets are generally recognized based on the amount of the initial measurement of the lease liability. Lease expense is recognized on a straight-line basis over the lease term. For lease terms of twelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities.
ROU assets are reviewed for impairment when indicators of impairment are present. ROU assets from operating and finance leases are subject to the impairment guidance in ASC Topic 360, Property, Plant, and Equipment, as ROU assets are long-lived non-financial assets.
ROU assets are tested for impairment individually or as part of an asset group if the cash flows related to the ROU assets are not independent from the cash flows of other assets and liabilities. An asset group is the unit of accounting for long-lived assets to be held and used, which represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.
The Company recognized no impairment of ROU assets as of March 31, 2026, and June 30, 2025.
The operating lease is included in operating lease right-of-use assets and operating lease liabilities as current and non-current liabilities in the unaudited condensed consolidated balance sheets as of March 31, 2026, and June 30, 2025.
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Leases that transfer substantially all the rewards and risks of ownership to the lessee, other than legal title, are accounted for as finance leases. Substantially all of the risks or benefits of ownership are deemed to have been transferred if any one of the five criteria is met: (i) transfer of ownership to the lessee at the end of the lease term, (ii) the lease containing a bargain purchase option, (iii) the lease term exceeding 75% of the estimated economic life of the leased asset, (iv) the present value of the minimum lease payments exceeding 90% of the fair value and (v) the underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. At the inception of a finance lease, the Company as the lessee records an asset and an obligation at an amount equal to the present value of the minimum lease payments. The leased asset is amortized over the shorter of the lease term or its estimated useful life if title does not transfer to us, while the leased asset is depreciated in accordance with our depreciation policy if the title is to eventually transfer to us. The periodic rent payments made during the lease term are allocated between a reduction in the obligation and interest element using the effective interest method in accordance with the provisions of ASC Topic 842.
Income Taxes
The Company adopted the ASC Topic 740, Income tax provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the unaudited condensed consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the unaudited condensed consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.
The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.
In assessing the realizability of deferred tax assets, management evaluates both positive and negative evidence, including projected future taxable income, tax planning strategies, recent financial performance, economic trends and potential changes in tax laws. Judgment is required in determining whether valuation allowances are necessary and adjustments to such valuation allowances could materially impact income tax expense or benefit in future periods. See Note 17 for details related to income taxes.
Uncertain Tax Positions
The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC Topic 740 provisions of Section 740-10-25 for the three and nine months ended March 31, 2026 and 2025.
Foreign Currencies Translation
The Company’s reporting currency is the United States dollar (“US$”) and the accompanying unaudited condensed consolidated financial statements have been expressed in United States dollars. The Company and its subsidiaries in the United States have functional currency of US$ whereas the functional currency of the Company’s subsidiaries in Malaysia is Malaysian Ringgit (“MYR”). The functional currencies represent the primary currencies of the economic environment in which the respective companies’ operations are conducted.
Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the unaudited condensed consolidated statement of operations.
For reporting purposes, in accordance with ASC Topic 830 “Translation of Financial Statements”, capital accounts of the unaudited condensed consolidated financial statements are translated into United States dollars from MYR at their historical exchange rates when the capital transactions occurred. Assets and liabilities are translated at the exchange rates as of balance sheet date. Income and expenditures are translated at the average exchange rate of the respective year. The gains and losses resulting from translation of financial statements subsidiaries to the reporting currency are recorded as a separate component of accumulated other comprehensive income (loss) within the statements of changes in stockholder’s equity.
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Translation of MYR into U.S. dollars has been made at the following exchange rates for the following periods:-
March 31, 2026 | March 31, 2025 | |||||||
| Period-end MYR:US$ exchange rate | ||||||||
| Average period MYR:US$ exchange rate | ||||||||
Comprehensive Income (Loss)
ASC Topic 220, Comprehensive Income, establishes standards for reporting and display of comprehensive income (loss), its components and accumulated balances. Comprehensive income (loss) as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive loss, as presented in the accompanying unaudited condensed consolidated statements of changes in stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive loss is not included in the computation of income tax expense or benefit.
Non-controlling Interest
The Company accounts for non-controlling interest in accordance with ASC Topic 810-10-45, which requires the Company to present non-controlling interests as a separate component of total shareholders’ equity on the unaudited condensed consolidated balance sheets and the unaudited condensed consolidated net loss attributable to the non-controlling interest being clearly identified and presented on the face of the unaudited condensed consolidated statements of operations and comprehensive loss.
The Company calculates net loss per share in accordance with ASC Topic 260, Earnings per Share. Basic loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is computed similarly to basic net loss per share, except that the denominator is increased to include the number of additional shares of common stock that would have been outstanding if the potential common stock equivalents had been issued, if dilutive.
The Company’s share-based awards consist of shares of common stock that are legally issued, fully vested, and nonforfeitable upon grant. Accordingly, such shares are included in the weighted-average shares outstanding from the date of issuance, and there are no unvested or forfeitable awards requiring separate consideration in the calculation of basic or diluted net loss per share.
For the three and nine months ended March 31, 2026 and 2025, diluted weighted-average shares of common stock outstanding is equal to basic weighted average shares of common stock, due to the Company’s net loss position. Hence no common stock equivalents were included in the computation of diluted net loss per shares since such inclusion would have been antidilutive.
| F-17 |
| Table of Contents |
Stock Cancellation and Reissuance Policy
In certain circumstances, after the Company grants fully vested and nonforfeitable share-based awards to nonemployees, the Company may enter into mutual agreements with the recipients to cancel shares associated with services not yet performed or no longer expected to be performed under the applicable arrangements. In such instances, the Company evaluates the substance of the arrangement in accordance with ASC 718-10-25-2 and ASC 718-10-35-1, which require that compensation cost be recognized based on the goods or services received. In accordance with ASC 718-10-45-3, the grant date fair value of these awards are initially recognized as prepaid share-based compensation, which is recognized as compensation expense over the period in which the related goods or services are received. When mutual agreements are concluded to cancel shares associated with services which are not performed or are no longer expected to be performed, the Company reverses the remaining balance of the prepaid share-based compensation, which represents the value of services not yet performed. There are no reversals of previously recognized share-based compensation expense relating to services already performed under the applicable arrangements.
Treasury Stock Policy
The Company may also, if required, cancel shares of its common stock that have been repurchased or otherwise reacquired, including shares acquired through share repurchase programs. Canceled shares are retired and removed from the issued and outstanding share count in accordance with applicable corporate law and the Company’s Articles of Incorporation.
Upon cancellation, the par value of the shares is deducted from common stock, and any excess of repurchase cost over the par value is charged against additional paid-in capital (APIC) or retained earnings, as applicable. If the original issuance price is not known or determinable, the cost is first charged to APIC to the extent available, with any remaining amount charged to retained earnings.
The Company accounts for reissuance of treasury shares in accordance with ASC 505-30 – Equity: Treasury Stock. Treasury shares may be reissued for various purposes, including the settlement of employee equity awards, acquisitions, or other corporate purposes.
If treasury shares are reissued:
| ● | The proceeds received upon reissuance are credited to treasury stock at the cost of the shares. | |
| ● | Any difference between the reissuance price and the cost of the treasury shares is recorded as an adjustment to APIC. |
| ○ | If the reissuance price exceeds the cost, the excess is credited to APIC. | |
| ○ | If the reissuance price is less than the cost and APIC related to treasury stock transactions is insufficient to absorb the difference, the remainder is charged to Retained Earnings. |
The Company uses the cost method to account for treasury stock transactions. Reissued shares are included in the
number of shares issued and outstanding as of the date of reissuance.
As of the date of this Quarterly Report, there have been no Treasury Stock purchases by the Company.
| F-18 |
| Table of Contents |
Stock-Based Compensation
The Company accounts for stock-based compensation in accordance with ASC Topic 718, Compensation—Stock Compensation, which requires the measurement and recognition of compensation expense for all share-based payment arrangements related to the acquisition of goods and services from both employees and nonemployees based on the fair value of the awards at grant date.
Grant Date and Measurement
The grant date represents the date on which all key terms and conditions of the award are approved and understood by both the Company and the recipient, which generally corresponds to the date of final board approval. The fair value of share-based awards is measured based on the closing market price of the Company’s common stock on the grant date.
The Company considers stock-based compensation to be a significant accounting estimate due to the judgment involved in determining the grant date, estimating the fair value of awards, evaluating the timing and recognition of compensation expense and assessing the substance of certain share-based arrangements. Because the Company issues common stock awards that are measured based on the market price of its common stock at the grant date, changes in the timing of grant approvals, service periods and the Company’s stock price, may impact the amount and timing of compensation expense recognized in future periods.
Fully Vested and Nonforfeitable Awards
The Company issues shares that are fully vested and nonforfeitable upon grant, and the Company does not retain the ability to cancel such shares. For these awards, the recipient has an unconditional right to the shares at the grant date.
When such awards are issued to nonemployees in advance of the receipt of goods or services, the Company records prepaid share-based compensation at the grant date in accordance with ASC 718-10-45-3. The prepaid amount represents the fair value of the goods or services to be received and is recognized as compensation expense over the period in which the related goods or services are received.
For employee awards, when shares are issued in advance of the receipt of services, the Company does not recognize a prepaid asset. Instead, consistent with ASC 718-10-25 and ASC 718-10-35, compensation cost is recognized over the requisite service period as the services are rendered.
Awards Without an Established Grant Date
For certain share-based payment arrangements, the service inception date precedes the establishment of the grant date. In such cases, compensation cost is recognized based on the best estimate of the fair value of the Company’s common stock at each reporting period until the grant date is established, with a corresponding liability recorded in accordance with ASC 718.
Once the grant date is established, the cumulative compensation cost is adjusted to reflect the grant-date fair value of the award.
Recognition of Compensation Expense
Share-based compensation cost is recognized over the requisite service period for employee awards and over the service period for nonemployee awards.
Presentation Considerations
Awards that are fully vested and nonforfeitable are included in shares issued and outstanding at the grant date.
| F-19 |
| Table of Contents |
Accordingly:
| ● | for nonemployees - APIC, together with shares issued, is recognized at the grant date fair value of the awards, with a corresponding increase in prepaid share-based compensation, which is recognized as compensation expense over the period in which the related goods or services are received; and | |
| ● | for employees - APIC is recognized to the extent that, together with shares issued, reflect the compensation cost for the requisite service period rendered as of the reporting date. Any remaining unrecognized compensation cost is recorded in APIC over the remaining requisite service period. |
The impact of such awards on earnings per share is evaluated in accordance with ASC 718-10-45-1.
Stock-Based Compensation Expense
During the three and nine months ended March 31, 2026, the Company recognized share-based compensation expense as follows:
| ● | Nonemployees: $ and $, respectively. | |
| ● | Employees: $ and $, respectively. | |
| ● | Directors: $ and $, respectively. |
During the three and nine months ended March 31, 2025, the Company recognized share-based compensation expense as follows:
| ● | Nonemployees: $ and $, respectively. | |
| ● | Employees: $ and $, respectively. |
In
addition, the Company recorded $
Retirement Plan Costs
Contributions to retirement plans (which are defined contribution plans) are charged to general and administrative expenses in the accompanying statements of operation as the related employee service are provided.
Related Parties
The Company follows the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.
Pursuant to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825-10-15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.
| F-20 |
| Table of Contents |
The unaudited condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income (loss) statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which income (loss) statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.
Commitments and Contingencies
The Company follows the ASC 450-20, Contingencies, to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.
If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s unaudited condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.
Warrant
The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC Topic 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC Topic 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of our control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.
Equity-classified
For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance. Warrants classified as equity instruments are initially recognized at fair value within APIC and are not subsequently remeasured. The warrants have been assessed to meet the requirements for equity classification and accounted for as equity. Upon exercise of the warrants, the Company will record the proceeds received, together with the carrying value of the warrants, as an increase to common stock and APIC. Warrants that expire unexercised will be derecognized with no impact on the statement of operations.
| F-21 |
| Table of Contents |
Liability-classified
For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as liabilities at their initial fair value on the date of issuance and are remeasured at each reporting date until settlement. Changes in fair value is recognized as a component of change in fair value of warrant liability in the condensed consolidated statements of operations and as a non-cash gain or loss in the condensed consolidated statement of comprehensive loss. Transaction costs allocated to warrants that are presented as a liability are immediately expensed in the consolidated statements of operations and comprehensive loss.
No liability classified warrants have been issued as of March 31, 2026.
Fair Value of Financial Instruments
The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP) and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:
| Level 1 | Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. | |
| Level 2 | Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. | |
| Level 3 | Pricing inputs that are generally unobservable inputs and not corroborated by market data. |
Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.
The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.
The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, short-term investments, loan and fee receivable, prepayments and other receivables, amounts due from related parties, accrued liabilities and other payables, loans payable, amounts due to related parties approximate their fair values because of the short maturity of these instruments.
| F-22 |
| Table of Contents |
Recent Accounting Pronouncements
During the nine months ended March 31, 2026, there have been no new, or existing, recently issued accounting pronouncements that are of significance, or potential significance, that impact the Company’s unaudited condensed consolidated financial statements.
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Account Receivable and Contract Assets. This update introduces a practical expedient for all entities when estimating expected credit losses on current accounts receivable and current contract assets arising from revenue transactions accounted for under Topic 606. The expedient allows entities to assume current conditions as of the balance sheet date remain unchanged over the remaining life of the asset. The amendments are required to be applied prospectively and are effective for annual and interim periods beginning after December 15, 2025. Early adoption is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This update provides amendments to clarify and modernize the accounting for costs incurred to develop or acquire internal-use software. The amendments address the capitalization of implementation costs by utilizing a principles-based approach and consolidates website development guidance under Subtopic 350-40. The amendments can be applied prospectively, modified prospectively, or retrospectively and are effective for annual and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures.
In September 2025, the FASB issued ASU No. 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. This update introduces a scope exception to derivative accounting for certain contracts with underlyings tied to operations or activities specific to one of the parties. Additionally, the update clarifies that share-based noncash consideration received from a customer should be accounted for under Topic 606 until the right to receive or retain the consideration becomes unconditional. The amendments can be applied prospectively or modified retrospectively and are effective for annual and interim periods beginning after December 15, 2026. While the Company has assessed that there is no significant impact to the condensed consolidated financial statements, the impact of this pronouncement on disclosures contained in notes thereto is being evaluated.
In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This update clarifies the applicability, form and content, and interim disclosure requirements in ASC Topic 270 and enhances navigability of the interim reporting guidance. The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, for public business entities and after December 15, 2028, for entities other than public business entities. Early adoption is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures.
In December 2025, the FASB issued ASU 2025-12, “Codification Improvements,” which updates the FASB Accounting Standards Codification to clarify, correct errors, and improve the overall usability of GAAP. The improvements consist of narrow-scope amendments, technical corrections, clarification of existing guidance, and updates to clarify the appropriate scope and application of certain disclosure requirements. ASU 2025-12 is effective for annual and interim periods beginning after December 15, 2026. Early adoption is permitted. The Company is currently evaluating the effect this pronouncement has had on the disclosures contained in the notes to the condensed consolidated financial statements.
The Company is currently reviewing all recently issued, but not yet effective, accounting pronouncements and is evaluating the impact of these pronouncements on the relevant disclosures. The Company believes the future adoption of any such pronouncements may not be expected to have a material impact on its financial condition or the results of its operations.
| F-23 |
| Table of Contents |
NOTE 3 – REVISION OF PRIOR PERIOD FINANCIAL STATEMENTS
Certain prior period amounts for the nine months ended March 31, 2025 have been revised to reflect corrections identified by management relating to the Company’s previously issued financial statements for the year ended June 30, 2025, which the Company expects to address in an amendment to its Annual Report on Form 10-K for the year ended June 30, 2025.
The Company evaluated the materiality of these corrections and concluded that they were not material to the previously issued interim financial statements. Accordingly, the Company has revised the prior period amounts in the accompanying unaudited condensed consolidated financial statements.
The revisions had no impact on previously reported net loss, earnings per share, total assets or total cash flows. However, as disclosed in Note 24, the revisions resulted in changes to the classification and presentation of certain line items within the consolidated balance sheet and consolidated statements of changes in stockholders’ equity. See Note 24 for the nature of the revisions, including the impacted financial statement line items and reporting periods, in accordance with ASC 250-10-50-7 through 50-12.
NOTE 4 – BUSINESS SEGMENT INFORMATION
The Company applies the provisions of ASC Topic 280, Segment Reporting, which requires disclosure of information about operating segments based on how management organizes the Company’s business activities for making operating decisions and assessing performance. The Company’s Chief Executive Officer serves as the Chief Operating Decision Maker (“CODM”).
The CODM reviews consolidated financial information, including revenue, operating expenses and net loss, when evaluating performance and allocating resources. The CODM uses net loss as the primary measure of performance and uses revenue as the primary measure for allocating resources.
During the fiscal year ended June 30, 2025, the Company reassessed its segment reporting conclusions in accordance with ASC Topic 280 due to changes in how the business is managed and how information is reviewed by the CODM.
Specifically, the Company’s operations have become more integrated, with centralized decision-making, shared resources, and aligned strategic objectives across the organization. As a result, the CODM no longer reviews discrete financial information for separate components of the business and instead evaluates performance and allocates resources based on consolidated financial information for the Company as a single segment.
Accordingly, the Company has determined that it operates as a single operating and reportable segment under ASC Topic 280. This conclusion reflects current-period facts and circumstances and differs from prior period assessments due to the evolution of the Company’s internal reporting structure and operational focus.
In prior periods, the Company had evaluated its operations as potentially comprising multiple segments based on earlier organizational structures and internal considerations and these segments were (i) trading and production of building materials and renewable commodities, (ii) holding of real property and (iii) licensor of proprietary pyrolysis technology. The CODM used sales and operating loss as the primary measure of segment profit or loss to assess performance and allocate resources.
| F-24 |
| Table of Contents |
Because the Company operates as a single segment and the CODM reviews consolidated financial information, the significant expense categories reviewed by the CODM are reflected in the consolidated statements of operations. The presentation of the comparative information has been revised for comparability with the current year presentation. The CODM reviews on a consolidated financial information basis the significant expense categories as disclosed below.
Three months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| (revised) | ||||||||
| Revenue | $ | $ | ||||||
| Cost of revenue | ||||||||
| Gross profit | ||||||||
| Operating expenses: | ||||||||
| Depreciation and amortization | ||||||||
| Impairment on assets held for sales | ||||||||
| Payroll expenses | ||||||||
| Consultant fees | ||||||||
| Research and development expense | ||||||||
| Legal and professional fees | ||||||||
| Other segment expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Interest expense | ( | ) | ||||||
| Rental income | ||||||||
| Unrealized foreign exchange gains | ||||||||
| Gain on forgiveness of debts | ||||||||
| Gain on disposal of property, plant and equipment | ||||||||
| Interest income | ||||||||
| Other income | ( | ) | ||||||
| Loss before income tax | ( | ) | ( | ) | ||||
| Income tax | ||||||||
| Net loss | $ | ( | ) | ( | ) | |||
| F-25 |
| Table of Contents |
Nine months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| (revised) | ||||||||
| Revenue | $ | $ | ||||||
| Cost of revenue | ||||||||
| Gross profit | ||||||||
| Operating expenses: | ||||||||
| Depreciation and amortization | ||||||||
| Impairment on property, plant and equipment | ||||||||
| Impairment on assets held for sales | ||||||||
| Payroll expenses | ||||||||
| Consultant fees | ||||||||
| Research and development expense | ||||||||
| Legal and professional fees | ||||||||
| Other segment expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Interest expense | ( | ) | ||||||
| Rental income | ||||||||
| Unrealized foreign exchange gains | ||||||||
| Gain from insurance claim | ||||||||
| Gain on forgiveness of debts | ||||||||
| Gain on disposal of property, plant and equipment | ||||||||
| Interest income | ||||||||
| Other income | ||||||||
| Loss before income tax | ( | ) | ( | ) | ||||
| Income tax | ||||||||
| Net loss | $ | ( | ) | ( | ) | |||
Substantially all of the Company’s revenue is generated in the United States. Long-lived assets are located primarily in the United States and in its subsidiaries in Malaysia and the British Virgin Islands, with the Company’s key intellectual property held by its BVI subsidiary.
NOTE 5 – SHORT-TERM INVESTMENTS
| ● | Interest
rates: | |
| ● | Maturities:
|
| F-26 |
| Table of Contents |
NOTE 6 – INVENTORIES
Inventories as of March 31, 2026, and June 30, 2025, consisted of the following:
March 31, 2026 | June 30, 2025 | |||||||
| Manufactured bio produce | $ | $ | ||||||
| Trading goods | ||||||||
| $ | $ | |||||||
Trading goods represent bio asphalt products purchased from an external supplier.
NOTE 7 – OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS
Other receivables, deposits and prepayments as of March 31, 2026, and June 30, 2025, consist of the following:
March 31, 2026 | June 30, 2025 | |||||||
| Deposits | $ | $ | ||||||
| Other receivables | ||||||||
| $ | $ | |||||||
| Less: impairment on other receivables | ( | ) | ( | ) | ||||
| Other receivables and deposits, net | $ | $ | ||||||
| Prepayments | ||||||||
| Prepaid share based compensation - nonemployees (current portion) | ||||||||
| $ | $ | |||||||
| Prepaid share based compensation - nonemployees (non-current portion) | $ | $ | ||||||
The Company accounts for share-based compensation in accordance with ASC 718 based on the grant-date fair value of the awards. When awards are granted to nonemployees in advance of the related services, the Company records the fair value as prepaid share-based compensation and recognizes the expense over the service period. Share-based compensation for employees is recognized over the requisite service period without the recognition of a prepaid asset. The portion of prepaid share-based compensation to nonemployees expected to be recognized within twelve months is classified as a current asset, with the remainder classified as non-current. This classification reflects the expected timing of the underlying service periods as defined in the applicable agreements.
| F-27 |
| Table of Contents |
NOTE 8 – PROPERTY, PLANT AND EQUIPMENT
A summary of property, plant and equipment as of March 31, 2026, and June 30, 2025, is as follows:
March 31, 2026 | June 30, 2025 | |||||||
| Plant and machinery | $ | $ | ||||||
| Office equipment | ||||||||
| Computers | ||||||||
| Motor vehicles | ||||||||
| Furniture and fittings | ||||||||
| Renovation | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Foreign exchange adjustment | ||||||||
| $ | $ | |||||||
| ● | Depreciation Expense: | |
| ○ | Three
months ended March 31, 2026 and 2025: $ | |
| ○ | Nine
months ended March 31, 2026 and 2025: $ | |
| ● | Impairment: | |
| ○ | Three months ended March 31, 2026
and 2025: $ | |
| ○ | Nine
months ended March 31, 2026 and 2025: $ |
NOTE 9 –INTANGIBLE ASSETS
March 31, 2026 | June 30, 2025 | |||||||
| Catalytic Biofraction Process | $ | $ | ||||||
| License for the Catalytic Biofraction Process | ||||||||
| $ | $ | |||||||
The
intangible assets comprise (i) intellectual property in the form of proprietary trade secrets (“IP”) with a value of $
The “Catalytic Biofraction Process” is a slow pyrolysis process using a proprietary catalyst to depolymerize palm biomass waste (empty fruit bunches or palm kernel shells) in temperature range of 350 degrees Celsius to 500 degrees Celsius to yield commercially valuable bio products: bio-oil, wood vinegar (pyroligneous acid), biochar and bio-syngas. The intellectual property is a second-generation pyrolysis process where non-food feedstock like palm biomass waste is used as feedstock. Upon fulfilling UN’s (United Nations) ACM 22 protocol as well as LCA (Life Cycle Assessment) requirements, it is anticipated that the by products from this IP would lead to certification and issuance of Carbon Avoidance Credits as well as Carbon Removal Credits to generate carbon revenue for the Company.
The Company has identified these intangible assets as indefinite life intangible assets as there are currently no legal, competitive, economic or other factors that materially limit the useful life of the Company’s intangible assets.
| F-28 |
| Table of Contents |
As of June 30, 2025, the Company performed a qualitative assessment, during the fourth quarter of 2025, to determine whether it was more likely than not that the carrying amounts of its intangible assets were impaired. This assessment considered a number of qualitative factors, including but not limited to:
| ● | Macroeconomic conditions, | |
| ● | Industry and market trends, | |
| ● | Cost factors, | |
| ● | Overall financial performance of the asset, | |
| ● | Legal and regulatory environment, and | |
| ● | Relevant internal reporting and management’s plans. |
Based on this qualitative assessment, management did not identify any events or changes in circumstances that would indicate that the carrying amounts of the Company’s intangible assets are not recoverable. The qualitative impairment assessment of the indefinite intangible assets conducted in June 2025 indicated that the fair value of such assets exceeded their carrying value and therefore were not at risk of impairment. Accordingly, no quantitative impairment test was deemed necessary, and no impairment losses were recognized for the year ended June 30, 2025. The management evaluated the situation for the nine months ended March 31, 2026, and determined that no significant changes had occurred. Accordingly, it is concluded that no impairment is required.
NOTE 10 – ASSETS HELD FOR SALE
At March 31, 2026, and June 30, 2025, assets held for sale are as follows:
March 31, 2026 | June 30, 2025 | |||||||
| Motor vehicles | $ | $ | ||||||
| Less: impairment | ( | ) | ( | ) | ||||
| $ | $ | |||||||
On
June 27, 2024, the Company, through its wholly-owned subsidiary Verde Renewables, a company incorporated under the laws of the State
of Missouri, entered into a Consignment Contract with ED’s Machinery LLC (“EDM”) to dispose plant and machinery and
motor vehicles with a carrying amount of $
| F-29 |
| Table of Contents |
NOTE 11 – DEPOSIT PAID
At March 31, 2026, and June 30, 2025, security deposit consists of the following:
March 31, 2026 | June 30, 2025 | |||||||
| Security deposit | ||||||||
| - Factory site | $ | $ | ||||||
On
March 2, 2022, the Company, through VRAP, entered into a Commercial Lease Agreement and Option to Purchase (“Segama Lease Agreement”)
the factory site from Segama Ventures for a lease term of seven (
NOTE 12 – AMOUNTS DUE TO/FROM RELATED PARTIES (INCLUDING CHAIRMAN AND CHIEF EXECUTIVE OFFICER)
The following breakdown of the balances due to/from related parties and director, consisted of:
March 31, 2026 | June 30, 2025 | |||||||
| Amount due to related parties | ||||||||
| Borneo Oil Corporation Sdn (“BOC”) (#2) | $ | $ | ||||||
| Borneo Oil Berhad (“BOB”) (#1) | ||||||||
| Taipan International Limited (#3) | ||||||||
| Borneo Energy Sdn Bhd (#1) | ||||||||
| Victoria Capital Sdn Bhd (#4) | ||||||||
| Makin Teguh Sdn Bhd (#1) | ||||||||
| J. Ambrose & Partners (#5) | ||||||||
| SB Resorts Sdn Bhd (#2) | ||||||||
| SB Supplies & Logistics Sdn Bhd (#1) | ||||||||
| Borneo Eco Food Sdn. Bhd (#1) | ||||||||
| $ | $ | |||||||
| Amount due from a related party | ||||||||
| Vetrolysis Limited (#6) | $ | $ | ||||||
| Amount due to director | ||||||||
| Mr. Jack Wong (#7) | $ | $ | ||||||
| (#1) |
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NOTE 13 - LEASES
The Company adopted ASU No. 2016-02, Leases and determines whether an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys the right to control the use of an identified fixed asset explicitly or implicitly for a period of time in exchange for consideration. Control of an underlying asset is conveyed if we obtain the rights to direct the use of and to obtain substantially all of the economic benefit from the use of the underlying asset. Some of our leases include both lease and non-lease components which are accounted for as a single lease component as the Company has elected the practical expedient. Some of the operating lease agreements include variable lease costs, primarily taxes, insurance, common area maintenance or increases in rental costs related to inflation. Substantially all of our equipment leases and some of our real estate leases have terms of less than one year and, as such, are accounted for as short-term leases as we have elected the practical expedient.
Operating leases are included in the right-of-use lease assets, other current liabilities and long-term lease liabilities on the unaudited condensed consolidated balance sheet. Right-of-use assets and lease liabilities are recognized at each lease’s commencement date based on the present values of its lease payments over its respective lease term. When a borrowing rate is not explicitly available for a lease, the incremental borrowing rate is used based on information available at the lease’s commencement date to determine the present value of its lease payments. Operating lease payments are recognized on a straight-line basis over the lease term.
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The table below presents the lease-related assets and liabilities recorded on the balance sheet.
March 31, 2026 | June 30, 2025 | |||||||
| Assets | ||||||||
| Right-of-use asset (1) | $ | $ | ||||||
| Right-of-use asset (2) | ||||||||
| Total RoU assets | ||||||||
| Less: Accumulated amortization | ( | ) | ( | ) | ||||
| $ | $ | |||||||
| Liabilities | ||||||||
| Current: | ||||||||
| Operating lease liabilities | $ | $ | ||||||
| Non-current: | ||||||||
| Operating lease liabilities | ||||||||
| Total lease liabilities | $ | $ | ||||||
| ● | Leases: |
| ○ | Right-of-use assets and lease liabilities: | |
| ■ | As
of March 31, 2026: $ | |
| ■ | As
of June 30, 2025: $ |
| ○ | Amortization of right-of-use assets: | |
| ■ | Three
months ended March 31, 2026 and 2025: $ | |
| ■ | Nine
months ended March 31, 2026 and 2025: $ |
| ● | Lease Arrangements: |
| ○ | (1) The
lease of the Segama factory has total contractual lease payments of $ | |
| ○ | (2) The Company, through its wholly owned subsidiary VRI, has entered into various motor vehicle lease arrangements with terms ranging from three to four years, expiring at various dates through 2029. Certain lease arrangements include purchase options at agreed-upon prices as specified in the respective agreements. The Company’s lease agreements do not contain any material restrictive covenants. |
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The table below presents the information related to weighted average discount rate and the remaining lease term (years) of the operating leases.
March 31, 2026 | June 30, 2025 | |||||||
| Operating leases | ||||||||
| Weighted average discount rate | % | % | ||||||
| Weighted average remaining lease term (years) | ||||||||
Accretion of Lease Liability:
| ● | Three
and nine months ended March 31, 2026: $ | |
| ● | Three
and nine months ended March 31, 2025: $ |
The Company excludes short-term leases (those with lease terms of less than one year at inception) from the measurement of lease liabilities or right-of-use assets. The following tables summarize the lease expense for the periods.
Nine months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Finance lease cost: | ||||||||
| Interest on lease liabilities (per ASC 842) | $ | $ | ||||||
| Operating lease cost: | ||||||||
| Operating lease expense (per ASC 842) | ||||||||
| Total lease expense | $ | $ | ||||||
Components of Lease Expense
The Company recognizes operating lease expense on a straight-line basis over the term of the operating leases, comprising interest expense determined using the effective interest method, and amortization of the right-of-use asset, as reported within “general and administrative” expense on the accompanying unaudited condensed consolidated statement of operations.
Finance lease expense comprises of interest expenses determined using the effective interest method.
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Future Contractual Lease Payments as of March 31, 2026
The below table summarizes (i) minimum lease payments over the next five years, (ii) lease arrangement implied interest, and (iii) present value of future lease payments for the next three years and thereafter ending March 31:
| Years ending March 31, | Operating lease amount | |||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| Total minimum lease liabilities payment | ||||
| Less: imputed interest | ( | ) | ||
| Present value of lease liabilities | $ | |||
| Representing: | ||||
| Current liabilities | $ | |||
| Non-current liabilities | ||||
| Present value of lease liabilities | $ | |||
NOTE 14 – WARRANTS
On
October 31, 2025, the Company entered into a securities purchase agreement (the “Ergon Purchase Agreement”) with Ergon, pursuant
to which Ergon purchased a total of shares (the “Ergon Shares”) of the Company’s common stock and a warrant
(the “Warrant”) to purchase
The
unregistered Warrant is exercisable beginning on October 31, 2025 and expires on October 31, 2030, and was issued in certificated
form. The exercise price of $
The Warrant is exercisable in whole or in part for cash, except that if, at the time the holder exercises the Warrant, a registration statement registering the resale of the Warrant Shares under the Securities Act of 1933, as amended (the “Securities Act”), is not then effective or available for the issuance of such Warrant Shares, then in lieu of making the cash exercise payment, the holder may elect to exercise the Warrant on a “cashless” basis and receive a net number of Warrant Shares determined according to a formula set forth in the common stock Purchase Warrant.
The Company evaluated the Warrant in accordance with ASC 815-40 and determined that they are indexed to the Company’s own stock and meet the criteria for equity classification. Accordingly, the Warrant was recorded in additional paid-in capital at their issuance-date fair value and are not subsequently remeasured.
The Warrant was issued in connection with common stock and the proceeds were allocated between the warrant and the related financial instrument based on their relative fair values within additional paid-in capital.
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NOTE 15 - STOCKHOLDERS’ EQUITY
Authorized Stock
The Company has authorized shares of common stock and shares of preferred stock, both with a par value of per share. Each share of common stock entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.
Preferred stock outstanding
There are shares of preferred stock outstanding as of March 31, 2026, and June 30, 2025.
Ergon Private Placement
On
October 31, 2025, the Company entered into a securities purchase agreement (the “Ergon Purchase Agreement”) with Ergon, pursuant
to which Ergon purchased a total of unregistered shares (the “Ergon Shares”) of the Company’s common stock
and an unregistered warrant (the “Warrant”) to purchase
The
Company received gross proceeds of $
Under the terms of the Ergon Purchase Agreement, Ergon is prohibited from selling any shares of common stock acquired in the Offering without the Company’s prior written consent until 180 days (the “Standstill Period”) after the closing of a firm commitment public offering of the common stock and concurrent uplisting to a national market exchange by the Company (the “Uplist”); provided that if the Uplist has not occurred by September 30, 2026, the prohibition on sales will terminate. The Ergon Purchase Agreement additionally grants Ergon (i) the right to appoint a non-voting observer to the Company’s board of directors for so long as Ergon holds one third (1/3) of the shares of common stock acquired in the Offering and so long as the Ergon License has not expired or been terminated in accordance with its terms, (ii) certain “piggyback” registration rights, whereby, subject to certain exceptions, following the Standstill Period, if the Company files a registration statement for the public offer and sale of its securities, Ergon has the right to have the Ergon Shares and Warrant Shares included in such registration statement for public resale, and (iii) subject to customary exemptions, a three (3) year right of participation in any issuance by the Company of common stock or common stock Equivalents (as defined in the Ergon Purchase Agreement) in a Company financing transaction, whereby Ergon has the right to participate in such transaction up to its then-current percentage holdings of the outstanding common stock as determined by dividing the number of shares of common stock then held by Ergon by the number of shares of common stock then outstanding.
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The Warrant was evaluated in accordance with applicable accounting guidance and was determined to be equity classified. Accordingly, the fair value of the Warrant was recorded in APIC.
Common stock outstanding
As of June 30, 2025, the Company had received proceeds and entered into binding subscription agreements for shares, that were issued shortly after year-end due to administrative timing. The Company had no remaining substantive performance obligations, and the investors were irrevocably committed to the transactions as of the balance sheet date, with no conditions precedent remaining. These shares as of June 30, 2025 were subsequently issued in July 2025.
Share based awards represent unregistered securities and are subject to resale restrictions under Rule 144 of the Securities Act of 1933, as amended.
Stock cancellations and re-issuances
| ● | On
September 8, 2023, the Company, through VRI, entered into a Service and Stock Cancellation Agreement with EMGTA LLC to cancel the
Service Agreement dated December 1, 2022, including the cancellation of
shares of common stock that were issued at $
per share on December 31, 2022 totaling $ |
Stock issued and stock cancelled to shareholders
| ● | On July 24, 2024, the Company issued shares of common stock for $ at $ per share to four U.S. shareholders and shares of common stock for $ at $ per share to twenty U.S. shareholders and one non-U.S. shareholder. | |
| ● | On August 9, 2024, the Company issued shares of common stock for $ at $ per share to one U.S. shareholder and shares of common stock for $ at $ per share to twenty-three U.S. shareholders and one non-U.S. shareholder. | |
| ● | On August 26, 2024, the Company issued shares of common stock for $ at $ per share to three U.S. shareholders, shares of common stock for $ at $ per share to six U.S. shareholders and two non U.S. shareholders. | |
| ● | On September 16, 2024, the Company issued shares of common stock for $ at $ per share to one U.S. shareholder and shares of common stock for $ at $ per share to two U.S. shareholders. | |
| ● | On October 16, 2024, the Company issued shares of common stock for $ at $ per share to three U.S. shareholders. | |
| ● | On November 27, 2024, the Company cancelled shares of common stock that were previously issued to two U.S. shareholders. |
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| ● | On January 2, 2025, the Company issued a total of shares of common stock, comprising shares of common stock for $ at $ per share to seven U.S. shareholders and shares of common stock for $ at $ per share to six U.S. shareholders. | |
| ● | On January 6, 2025, the Company cancelled shares of common stock that were previously issued to two U.S. shareholders. | |
| ● | On February 18, 2025, the Company issued a total of shares of common stock, comprising shares of common stock for $ at $ per share to one non-U.S. shareholder, shares of common stock for $ at $ per share to seven U.S. shareholders and shares of common stock for $ at $per share to one U.S. shareholder. | |
| ● | On April 22, 2025, the Company cancelled shares of common stock that were previously issued to one U.S. shareholder. | |
| ● | On May 20, 2025, the Company issued shares of common stock for $ at $ per share to one U.S. shareholder and one non-U.S. shareholder. | |
| ● | On July 1, 2025, the Company issued a total of shares of common stock which were committed to be issued as of June 30, 2025, comprising shares of common stock for $ at $ per share to one non-U.S. shareholder and shares of common stock for $ at $ per share to one non-U.S. shareholder and seven U.S. shareholders. | |
| ● | On July 28, 2025, the Company issued a total of shares of common stock for $ at $ per share to one U.S. shareholder. | |
| ● | On September 12, 2025, the Company issued a total of shares of common stock for $ at a price of $ per share to three non-U.S. shareholders. |
Stock issued to nonemployees and employees
| ● | On July 31, 2024, the Company issued shares of the Company’s common stock to each of Dr. Nam Tran and Dr. Raymond Powell. See Note 21 Shares Issued to Nonemployees and Employees, National Implementation Expert Agreements. | |
| ● | On August 8, 2024, the Company issued shares of the Company’s common stock to Dale Ludwig. See Note 21 Shares Issued to Nonemployees and Employees, Ludwig Agreement. | |
| ● | On August 30, 2024, the Company issued shares of the Company’s common stock to Jeremy P. Concanon. See Note 21 Shares Issued to Nonemployees and Employees, Jeremy P. Concannon – Chief Growth Officer | |
| ● | On August 30, 2024, the Company issued shares of the Company’s common stock to Eric Bava. See Note 21 Shares Issued to Nonemployees and Employees, Eric Bava-Chief Operating Officer. | |
| ● | On January 2, 2025, the Company issued shares of the Company’s common stock to Aegis Ventures Limited. See Note 21 Shares Issued to Nonemployees and Employees, AUM Capital Markets Advisory Agreement. | |
| ● | On January 3, 2025, the Company issued shares of the Company’s common stock to Hannah Bruehl. See Note 21 Shares Issued to Nonemployees and Employees, Hannah Bruehl-Chief of Staff. |
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| ● | On June 1, 2025, the Company issued shares of the Company’s common stock to Sundeo Pty Ltd, an affiliate designated by C-Twelve. See Note 21 Shares Issued to Nonemployees and Employees, C-Twelve Joint Development and License Agreement. | |
| ● | On June 1, 2025, the Company issued shares of the Company’s common stock to Karl Strahl. See Note 21 Shares Issued to Nonemployees and Employees, Karl Strahl – Director. | |
| ● | On July 1, 2025, the Company issued shares of the Company’s common stock to Dr. Raymond Powell. See Note 21 Shares Issued to Nonemployees and Employees, National Implementation Expert Agreements. | |
| ● | On January 5, 2026, the Company issued shares of the Company’s common stock to Dr. Nam Tran. See Note 21 Shares Issued to Nonemployees and Employees, National Implementation Expert Agreements. | |
| ● | On January 5, 2026, the Company issued shares of the Company’s common stock to Dale Ludwig. See Note 21 Shares Issued to Nonemployees and Employees, Ludwig Agreement. | |
| ● | On January 5, 2026, the Company issued shares of the Company’s common stock to Eric Bava. See Note 21 Shares Issued to Nonemployees and Employees, Eric Bava-Chief Operating Officer. | |
| ● | On January 5, 2026, the Company issued shares of the Company’s common stock to Hannah Bruehl. See Note 21 Shares Issued to Nonemployees and Employees, Hannah Bruehl-Chief of Staff. | |
| ● | On February 19, 2026, the Company issued shares of the Company’s common stock to Technologies Apex, LLC. See Note 21 Shares Issued to Nonemployees and Employees, Apex Agreement. | |
| ● | On February 19, 2026, the Company issued shares of the Company’s common stock to Christopher David Poorman. See Note 21 Shares Issued to Nonemployees and Employees, Poorman Agreement. |
Debt settled in shares
| ● | On
August 16, 2024, the Company issued
shares of the Company’s common stock at the price of
$
per share to Borneo Oil Berhad in relation to the Settlement
of Debts Agreement (the “SDA Agreement”) and a two-year term period promissory note entered into with its former indirect
wholly-owned subsidiary Champmark Sdn Bhd (“CSB”) and CSB’s creditor Borneo Oil Corporation Sdn Bhd (the “Creditor”)
to settle in full a total of $ |
Not considering the commitment to cancel shares as above, there were shares of common stock issued and outstanding at March 31, 2026 and shares of common stock issued and outstanding at June 30, 2025 (including shares which were issued for private placement subsequent to financial year end).
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Three Months ended March 31, | Nine months ended March 31, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (revised) | ||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Less: Net loss attributable to non-controlling interest | ||||||||||||||||
| Net loss attributable to Verde Resources, Inc. shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted average common stock outstanding, basic and diluted (revised) | ||||||||||||||||
| Net loss per share, basic and diluted | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
For the three and nine months ended March 31, 2026, diluted weighted-average shares of common stock outstanding is equal to basic weighted-average shares of common stock, due to the Company’s net loss position. Hence, no common stock equivalents were included in the computation of diluted net loss per share since such inclusion would have been antidilutive.
The Company has evaluated its share-based awards and confirmed that all shares are fully vested and nonforfeitable during the period and are included in the weighted-average shares of common stock outstanding.
NOTE 17 - INCOME TAX
For the nine months ended March 31, 2026 and 2025, the local (US) and foreign components of loss before income taxes consisted of the following:
Nine months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Tax jurisdiction from: | ||||||||
| - Local (US regime) | $ | ( | ) | $ | ( | ) | ||
| - Foreign, including | ||||||||
| British Virgin Islands | ||||||||
| Malaysia | ( | ) | ( | ) | ||||
| Labuan, Malaysia | ( | ) | ||||||
| Loss before income taxes | $ | ( | ) | $ | ( | ) | ||
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The provision for income taxes consisted of the following:
Nine months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Current tax: | ||||||||
| - Local | $ | $ | ||||||
| - Foreign | ||||||||
| Deferred tax | ||||||||
| - Local | ||||||||
| - Foreign | ||||||||
| Income tax expense (benefit) | $ | $ | ||||||
The effective tax rate in the periods presented reflects the impact of losses incurred across various tax jurisdictions, each with different applicable income tax rates.
The Company mainly operates in the United States and Malaysia and is subject to taxes in the jurisdictions in which they operate, as follows:
United States of America
The
Company, VRI, VerdePlus and VLI are subject to the tax laws of United States of America. The U.S. corporate income tax rate is
The
Company has provided for a full valuation allowance against the deferred tax assets of $
Net Operating Losses (NOLs) generated prior to January 1, 2018, are able to be carried forward up to twenty subsequent years. Any NOLs created for tax years subsequent to that may be carried forward indefinitely. However, any NOLs arising from tax years ending after December 31, 2020, can only be used to offset up to 80% of taxable income.
For the nine months ended March 31, 2026 and 2025, there was no operating income under the U.S. tax regime.
BVI
Under current BVI law, VRAP is not subject to tax on income.
Labuan
Under
the current laws of the Labuan applicable to BRL, income derived from an intellectual property right is subject to tax under the Malaysian
Income Tax Act 1967 (ITA) at
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Malaysia
The
Company’s subsidiaries, Verde Malaysia and Wision, are registered in Malaysia and are subject to the Malaysian corporate income
tax at a standard income tax rate of
The
operation in Malaysia incurred $
Nine months ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Loss before income taxes | $ | ( | ) | $ | ( | ) | ||
| Statutory income tax rate | % | % | ||||||
| Income tax expense at statutory rate | ( | ) | ( | ) | ||||
| Non-deductible items | ||||||||
| Tax losses unable to be carried forward | ( | ) | ||||||
| Valuation allowance | ||||||||
| Income tax expense | $ | $ | ||||||
Singapore
The
Company operates in Singapore through its wholly owned subsidiary, Verde Resources Asia Pacific Pte. Ltd. Income earned by the Singapore
subsidiary is subject to the statutory corporate income tax rate of
The following table sets forth the significant components of the deferred tax assets of the Company:
March 31, 2026 | June 30, 2025 | |||||||
| Deferred tax assets: | ||||||||
| Net operating loss carryforwards, from | ||||||||
| US tax regime | $ | $ | ||||||
| Malaysia tax regime | ||||||||
| Less: valuation allowance | ( | ) | ( | ) | ||||
| Deferred tax assets, net | $ | $ | ||||||
The Company has recorded valuation allowances for certain tax attribute carry forwards and other deferred tax assets due to uncertainty that exists regarding future realizability. If in the future the Company believes that it is more likely than not that these deferred tax benefits will be realized, the majority of the valuation allowances will be reversed in the unaudited condensed consolidated statement of operations. The Company did not have uncertainty tax positions or events leading to uncertainty tax position within the next 12 months.
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NOTE 18 - RELATED PARTY TRANSACTIONS
| Nine months ended | ||||||||
| March 31, | ||||||||
| 2026 | 2025 | |||||||
| Related party transactions: | ||||||||
| Rental income: | ||||||||
| Mr. Jack Wong (1) | $ | $ | ||||||
| SB Resorts Sdn Bhd (2) | $ | $ | ||||||
| Interest expense paid to: | ||||||||
| BOC (2) | $ | $ | ||||||
| Sale of property: | ||||||||
| Mr. Jack Wong (1) | $ | $ | ||||||
| Creative and technical services fee paid to: | ||||||||
| Mr. Teo Zye Keun (3) | $ | $ | ||||||
Forgiveness of debts by: | ||||||||
| Makin Teguh Sdn Bhd (2) | $ | $ | ||||||
| J. Ambrose & Partners (2) | $ | $ | ||||||
Related party balances are disclosed in Note 12.
| (1) |
| ● | Jack Wong serves as Chief Executive Officer and Chairman of the Company and was elected to the Board of Directors effective March 30, 2024. | |
| ● | The
Company completed the sale of property located at 1138 Wildhorse Parkway Drive, Chesterfield,
Missouri 63005, owned by VRI, for a current market value of $ | |
| ● | A
gain on disposal of $ |
| (2) |
| ● | SB Resorts Sdn Bhd and BOC are wholly owned subsidiaries of BOB. | |
| ● | Makin Teguh Sdn Bhd is an associate of BOB | |
| ● | BOB
held approximately | |
| ● | J. Ambrose & Partners is controlled by J Ambrose who
is one of the shareholders of the Company, and he held |
| (3) |
| ● | Teo Zye Keun is a Director of The Wision Project Sdn Bhd, a subsidiary of the Company. |
Apart from the transactions and balances detailed elsewhere in these accompanying unaudited condensed consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented
NOTE 19 - CONCENTRATIONS OF RISK
The Company is subject to concentrations of credit risk primarily from customers and vendors. Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and accounts receivable. The Company performs ongoing credit evaluations of its customers and generally does not require collateral.
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Major Customers
For the nine months ended March 31, 2026 and 2025, there was one single customer in each period whose revenue exceeded 10% of the revenue.
| Revenue | |||||||||||||||||
| March 31, 2026 | March 31, 2025 | ||||||||||||||||
| USD | % | USD | % | ||||||||||||||
| Customer A | $ | $ | % | $ | % | ||||||||||||
| Customer B | $ | % | % | ||||||||||||||
Accounts Receivable Concentration
Accounts receivable concentrations from customers representing more than 10% of total accounts receivable were as follows:
| Account Receivable | ||||||||
| March 31, 2026 | June 30, 2025 | |||||||
| Customer A | $ | $ | ||||||
| Customer B | $ | $ | ||||||
Major Vendors
The Company relies on a limited number of vendors for certain materials and services used in its operations.
For the nine months ended March 31, 2026 and 2025, the Company had one vendor in each period, whose purchases accounted for more than 10% of total direct costs included in cost of revenue.
| Direct Costs | ||||||||||||||||
| March 31, 2026 | March 31, 2025 | |||||||||||||||
| USD | % | USD | % | |||||||||||||
| Vendor A | $ | $ | % | $ | % | |||||||||||
| Vendor B | % | % | ||||||||||||||
Accounts Payable Concentration
Accounts payable concentrations from vendors representing more than 10% of total accounts payable were as follows:
| Account Payable | ||||||||
| March 31, 2026 | June 30, 2025 | |||||||
| Vendor A | $ | $ | ||||||
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Revenue by Geographic Location
The revenues below are based on the countries in which the customer is located. Summarized financial information concerning the geographic segments is shown in the following tables:
Three Months ended March 31, | Nine months ended March 31, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Malaysia | $ | $ | $ | $ | ||||||||||||
| United States of America | ||||||||||||||||
| $ | $ | $ | $ | |||||||||||||
Geopolitical and Political Risk
The Company’s operations are primarily conducted in the United States and Malaysia, with intended expansion into Mexico and Canada. Accordingly, the political, economic, and legal environments in the United States, Mexico, Canada, and Malaysia, as well as general economic conditions in these regions, may influence the Company’s business, financial condition, and results of operations.
In addition, ongoing geopolitical developments, including the armed conflict involving Iran and military actions in the Middle East, the conflict between Russia and Ukraine, and broader global trade uncertainties, have increased volatility in global economic conditions. The Middle East conflict has involved direct military strikes, retaliatory actions, and disruptions to key global trade routes and energy infrastructure, contributing to fluctuations in energy prices, inflationary pressures, and supply chain disruptions.
The extent and duration of these geopolitical and economic uncertainties remain unpredictable, and any resulting adverse developments could have a material impact on the Company’s business, financial condition, and results of operations.
Exchange rate risk
The Company cannot guarantee that the current exchange rate will remain steady; therefore, there is a possibility that the Company could post the same amount of losses for two comparable periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of MYR converted to US$ on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.
NOTE 20 - PENSION COSTS
The
Company is required to make contribution to their employees under a government-mandated defined contribution pension scheme for its eligible
full-time employees in Malaysia. The Company is required to contribute a specified percentage of the participants’ relevant income
based on their ages and wage level. During the nine months ended March 31, 2026, and 2025, $
The Company enters into consulting, employment, and advisory agreements pursuant to which compensation may be paid, in whole or in part, through the issuance of shares of the Company’s common stock.
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Share-based awards issued under these arrangements are generally structured as separate equity awards with distinct grant dates corresponding to final board approval. Shares are issued as fully vested and nonforfeitable upon grant; however, such awards are often granted in advance of the performance of the related services.
For certain arrangements, shares are awarded based on tranches covering varying service periods within the entire service agreement. Each tranche represents a separate share-based award with a distinct grant date. Shares issued under each tranche are fully vested and nonforfeitable upon grant; however, the awards are granted in advance of the related service periods. As such, if the requisite services are not completed, the Company may cancel the related shares and reverse any previously recognized share-based compensation expense associated with unperformed services.
Accordingly, although the shares are legally issued and fully vested upon grant, the Company recognizes the related share-based compensation expense over the requisite service period in accordance with ASC 718, as the services are performed.
These awards are evaluated based on their substantive terms and conditions to determine the appropriate accounting treatment under ASC 718.
Consulting and Advisory Agreements
Looi Pei See Agreement
On December 15, 2022, the Company entered into a services agreement with Looi Pei See (the “Looi Pei See Agreement”) to support the development of retail markets in Malaysia and Singapore.
Under the Looi Pei See Agreement, the Company issued shares of the Company’s common stock on December 31, 2022. The shares had a grant-date fair value of $, based on a closing stock price of $ per share on December 31, 2022 (date of final board approval and grant date).
The shares were issued in advance of the service period from December 15, 2022 through December 14, 2025. Accordingly, the Company recognizes the related compensation expense over the three-year service period.
During
the nine months ended March 31, 2026, the Company recognized $
Fosnacht Agreement
On October 23, 2023, the Company, through VRI, entered into a services agreement (the “Fosnacht Agreement”) with Donald R. Fosnacht to engage him as National Certification and Extensive BCR (Biochar Carbon Removal) Implementation Specialist to develop and implement a comprehensive strategy to obtain national and regional certification and endorsement for carbon net-negative construction products with high biochar content, encompassing asphalt, concrete, and soil stabilization as designated in the Fosnacht Agreement.
Under the Fosnacht Agreement, the Company issued shares of the Company’s common stock, on January 31, 2024. The shares had a grant-date fair value of $, based on a closing stock price of $ per share on January 31, 2024 (date of final board approval and grant date). The term of the Fosnacht Agreement expired on December 31, 2025.
The shares were issued in advance of the service period through December 31, 2025, and compensation expense is recognized over the service period.
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During
the nine months ended March 31, 2026, the Company recognized $
National Implementation Expert Agreements
On April 20, 2024 and as amended on June 29, 2024, the Company entered into two services agreements (the “NIE Agreements”) with Dr. Nam Tran and Dr. Raymond Powell to serve as National Implementation Experts for VRI, to initiate connections with esteemed asphalt contractors, identify potential partners, explore potential collaborations through their extensive networks in the asphalt industry and recommend strategies to capitalize on emerging opportunities as designated in the NIE Agreements.
Under the NIE Agreements, each consultant is entitled to receive shares of common stock, to be granted in three separate tranches of shares each corresponding to successive twelve-month service periods beginning May 1, 2024. The term of the NIE Agreements will remain effective until April 30, 2027, and both parties may renew their respective agreement, or enter into a new agreement as may be mutually agreed on terms to be separately negotiated.
The first tranche of shares for each consultant was approved and issued on July 31, 2024 and had a grant-date fair value of $ per consultant, based on a stock price of $ per share on July 31, 2024 (date of final board approval and grant date).
As the second tranche of shares to Dr. Raymond Powell were only approved and issued on July 1, 2025 (date of final board approval and grant date), the compensation expense for the service period for the two months ended June 30, 2025 was accrued for based on management’s best estimate of the fair value of the stock determined as the stock price as of grant date of $ per share, for a total fair value of $.
The Company agreed that as part of the compensation package in the addendum to the NIE Agreement with Nam Tran, dated December 27, 2025 the share issuance shall be based on a fixed dollar amount of $ as set forth in the NIE Agreement, with the number of shares calculated based on the applicable share price at the time of issuance.
On January 5, 2026, the Company issued shares of the Company’s common stock to Dr. Nam Tran, for the service period from May 1, 2025, and April 30, 2026, based on a stock price of $ per share on January 5, 2026 (date of final board approval and grant date).
During
the nine months ended March 31, 2026, the Company recognized $
Ludwig Agreement
On June 1, 2024 and as amended June 29, 2024, the Company entered into a multi-year services agreement with Dale Ludwig (the “Ludwig Agreement”) to serve as a strategic advisor to maintain and build strong relationships with policymakers at both state and federal levels, collaborate with Missouri Department of Transportation, build relationships with MAPA members, collaborate with Missouri contractors to encourage the use of the Company’s technologies, identify current biochar producers in Missouri and engage with the Missouri Department of Economic Development.
The Ludwig Agreement provides for the issuance of shares of common stock in three tranches (, , and shares), each representing separate awards corresponding to successive service periods, which begins 11 months from June 1, 2024 and 12 months from May 1, 2025, and May 1, 2026, respectively.
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The first tranche of shares was approved and issued on August 8, 2024 and had a grant-date fair value of $, based on a stock price of $ per share on August 8, 2024 (date of final board approval and grant date).
The Company agreed that as part of the compensation package in the addendum to the Ludwig Agreement, dated December 27, 2025, the share issuance shall be based on a fixed dollar amount of $ as set forth in the Ludwig Agreement, with the number of shares calculated based on the applicable share price at the time of issuance.
On January 5, 2026, the Company issued shares of the Company’s common stock to Dale Ludwig for the service period from May 1, 2025 to May 1, 2026, based on a stock price of $ per share on January 5, 2026 (date of final board approval and grant date).
During
the nine months ended March 31, 2026, the Company recognized $
AUM Capital Markets Advisory Agreement
On November 29, 2024, the Company, through VRI entered into a consulting services agreement (the “AUM Agreement”) to engage AUM Media Inc (“AUM”), a Delaware corporation, to provide capital markets advisory, investor relations, and media relations services in connection with the Company’s planned equity financing and anticipated Nasdaq uplisting.
The AUM Agreement provides for:
| ● | a
monthly cash fee of $ | |
| ● | the issuance of shares (% of the Company’s outstanding shares as of November 29, 2024). |
The shares are issuable in two tranches:
| ● | shares upon execution of the agreement, and | |
| ● | shares upon Nasdaq listing. |
On January 2, 2025, the Company issued the first tranche of shares to Aegis Ventures Limited, as designated by AUM.
The shares had a grant-date fair value of $, based on a grant date of November 29, 2024 and closing stock price of $ per share. The shares were issued in advance of the service period from January 1, 2025 through December 31, 2025, and compensation expense is recognized over the service period.
During
the nine months ended March 31, 2026, the Company recognized $
Poorman Agreement
On January 2, 2026, the Company, through VRI, entered into a services agreement (the “Poorman Agreement”) with Christopher David Poorman to engage him as Logistic & Deployment Consultant to the Company and its affiliates, including operational strategy, scaling, process development, and safety, compliance, and risk management.
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Under the Poorman Agreement, the Company issued shares of the Company’s common stock on February 19, 2026. The shares had a grant-date fair value of $, based on a closing stock price of $ per share on February 19, 2026 (date of final board approval and grant date).
The shares were issued in advance of the service period from January 2, 2026 through December 31, 2026. Accordingly, the Company recognizes the related compensation expense over the service period.
During
the nine months ended March 31, 2026, the Company recognized $
Apex Agreement
On January 2, 2026, the Company, through VRI, entered into a services agreement (the “Apex Agreement”) with Technologies Apex, LLC for business development and packaging strategy advisory services, including packaging optimization and design, marketing and branding, sales enablement, and related strategic support.
Under the Apex Agreement, the Company issued shares of the Company’s common stock on February 19, 2026. The shares had a grant-date fair value of $, based on a closing stock price of $ per share on February 19, 2026 (date of final board approval and grant date).
The shares were issued in advance of the service period from January 2, 2026 through January 1, 2027. Accordingly, the Company recognizes the related compensation expense over the two-year service period.
During
the nine months ended March 31, 2026, the Company recognized $
Michelle Yanez – Senior Advisor Capital Markets, Finance & SEC Compliance
On March 1, 2026, the Company, through VRI, entered into a services agreement (the “Yanez Agreement”) with Michelle Yanez to serve as a senior advisor to the Company on capital markets, finance, and SEC compliance matters, including advisory support in connection with a potential Nasdaq uplisting and related exchange requirements, monitoring of Nasdaq compliance and SEC reporting obligations, assistance with financial systems and internal controls, coordination with external auditors, and investor readiness support.
The
Company agreed that 50% of the monthly salary will be paid in cash, with the remaining 50% to be settled in shares of the Company’s
common stock. The equity portion is based on a fixed monthly value of $
During
the nine months ended March 31, 2026, the Company recognized $
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Employee and Director Share Compensation
Eric Bava – Chief Operating Officer
On October 1, 2023, the Company entered into an employment agreement with Eric Bava, (the “Bava Employment Agreement”, as amended) with the Company’s Chief Operating Officer. The Company agreed to issue of the Company’s common stock annually to Eric Bava, upon completion of each full year of service under the Bava Employment Agreement, as amended. The term of the Bava Employment Agreement will remain effective until September 30, 2027.
On August 30, 2024, the Company approved and issued shares with a grant-date fair value of $, based on a closing stock price of $ per share on August 30, 2024 (date of final board approval and grant date). These shares were related to the service period from October 1, 2023 through September 30, 2024.
Pursuant to the addendum to the Bava Employment Agreement dated August 29, 2025, the grant-date fair value of the share-based compensation for the second year of service was established at $. Prior to the establishment of the grant date, compensation expense was accrued based on management’s estimate of fair value in accordance with ASC 718-10-30-6. Accordingly, $ was recognized over the requisite service period from October 1, 2024 through June 30, 2025.
On January 5, 2026, the Company issued shares of the Company’s common stock to Eric Bava, for the service period from October 1, 2024 to September 30, 2025, based a stock price of $ per share on January 5, 2026 date of final board approval and grant date).
During
the nine months ended March 31, 2026, the Company recognized $
Jeremy P. Concannon – Chief Growth Officer
On July 31, 2024, VRI entered into a service agreement with Jeremy P. Concannon, the Company’s Chief Growth Officer of the Company, effective from August 1, 2024 (the “Concannon Services Agreement”).
Pursuant to the Concannon Services Agreement, as amended on September 27, 2024, the Company agreed to issue a total of shares of the Company’s common stock to Jeremy P. Concannon over three tranches of shares, with each tranche of shares to be issued as compensation for each service period beginning 12 months from August 1, 2024, and 2025, and for 14 months from August 1, 2026, to September 30, 2027, respectively. The term of the Concannon Service Agreement will remain effective until September 30, 2027, and both parties may renew the agreement, or enter into a new agreement as may be mutually agreed on terms to be separately negotiated.
The first tranche of shares was approved and issued on August 30, 2024, with a grant-date fair value of $, based on a closing stock price of $ per share on August 30, 2024 (date of final board approval and grant date).
During the nine months ended March 31, 2026, the Company recognized $ of compensation expense related to the Concannon Services Agreement, which is recorded to selling, general and administrative expenses. The second tranche of shares of common stock due to be issued to Mr. Concannon on August 31, 2025, has not been issued as of the date of this Quarterly Report.
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Hannah Bruehl – Chief of Staff
The Company agreed to issue shares of common stock to Hannah Bruehl, Chief of Staff of the Company for the service period from September 3, 2024 to September 2, 2025, as part of the compensation package in the employment agreement signed on September 3, 2024 (the “Bruehl Agreement”).
The shares were approved and issued on January 3, 2025, and had a grant-date fair value of $, based on a closing stock price of $ per share on January 3, 2025 (date of final board approval and grant date).
The Company agreed that as part of the compensation package in the addendum to the Bruehl Agreement, dated December 27, 2025, the share issuance shall be based on a fixed dollar amount of $ as set forth in the Bruehl Agreement, with the number of shares calculated based on the applicable share price at the time of issuance.
On January 5, 2026, the Company issued shares of the Company’s common stock to Hannah Bruehl for the service period from September 3, 2025 to September 2, 2026, based on a stock price of $ per share on January 5, 2026 (based on date of final board approval and grant date).
During
the nine months ended March 31, 2026, the Company recognized $
Karl Strahl – Director
On June 1, 2025, the Company approved and issued shares of common stock to Karl Strahl pursuant to a director appointment agreement, dated May 1, 2025, by and between the Company and Karl Strahl, covering the service period May 1, 2025 through April 30, 2026.
The shares had a grant-date fair value of $, based on a stock price of $ per share on January 3, 2025 (date of final board approval and grant date).
During
the nine months ended March 31, 2026, the Company recognized $
License Agreement
C-Twelve Joint Development and License Agreement
On October 18, 2024, the Company entered into a binding term sheet with C-Twelve (the “C-Twelve Term Sheet”), pursuant to which C-Twelve agreed to grant the Company: (i) an exclusive license to utilize its proprietary binder and biochar asphalt mixed designs for the production and commercialization of asphalt surfacing-related products within the United States; and (ii) a first right of refusal to extend the exclusive licensing of the Licensed Technology (as defined in the C-Twelve Term Sheet) to other countries and territories, subject to terms and conditions to be mutually agreed.
The C-Twelve Term Sheet, originally set to expire on February 28, 2025, was subsequently extended to May 31, 2025. On May 19, 2025, the Company and C-Twelve entered into the C-Twelve Agreement, which formalized the licensing and collaboration terms contemplated by the C-Twelve Term Sheet.
In consideration for the rights granted under the C-Twelve Agreement, the Company agreed to issue shares of the Company’s common stock to C-Twelve within thirty (30) business days following the effective date of the C-Twelve Agreement. On June 1, 2025, the Company approved and issued shares to Sundeo Pty Ltd, an affiliate designated by C-Twelve.
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The shares had a grant-date fair value of $, calculated based on the Company’s closing stock price of $ per share on June 1, 2025, which represents the date of final board approval and grant date.
The Company determined that the share issuance represents compensation for services and other performance obligations associated with the arrangement including licensing, development, and collaboration activities. Accordingly, the fair value of the shares is recognized as expense over the service period of May 19, 2025 through May 18, 2035, in accordance with ASC 718.
During
the nine months ended March 31, 2026, the Company recognized $
Unrecognized Stock-Based Compensation
Although shares are generally issued as fully vested upon grant, certain awards are granted in advance of the performance of services. Accordingly, the Company has unrecognized stock-based compensation cost related to services to be rendered in future periods.
As of March 31, 2026 and June 30, 2025:
| ● | Nonemployee awards: $ and $, respectively, of unrecognized compensation expense to be recognized over a weighted-average period of years and years, respectively. | |
| ● | Employee and director awards: $ and $, respectively, of unrecognized compensation expense to be recognized over a weighted-average period of years and years, respectively. |
There was no income tax benefit recognized in connection with stock-based compensation expenses.
NOTE 22 - COMMITMENTS AND CONTINGENCIES
Future commitments with regards to repayment of lease liabilities are disclosed in Note 13.
Apart from the above, as of March 31, 2026, the Company had the following capital commitment:
| a) | commitment to issue shares of common stock to the following service providers on or before October 31, 2026, subject to final board approval for the second and third tranches equivalent to the fixed dollar amounts as below, for services to be performed pursuant to each individual’s respective service agreement and related addendum signed with the nonemployees as disclosed in Note 21: |
| Financial year ended June 30, 2027: | ||||
| Nam Tran | ||||
| Raymond Powell | ||||
| Dale Ludwig | ||||
| b) | commitment to issue shares of the Company’s shares of common stock to Jeremy P. Concannon, an employee, for the second tranche for a twelve-month service period from August 1, 2025, which was due on or before August 31, 2025 and the third tranche of shares of common stock for a fourteen-month period commencing August 1, 2026, both being subject to final board approval and pursuant to the service agreement signed as disclosed in Note 21. |
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| c) | commitment to cancel shares of common stock pursuant to a service agreement and a service and stock cancellation agreement with EMGTA LLC as disclosed in Note 15. | |
| d) | quarterly
committed payments of $ | |
| e) | commitment to issue shares of common stock to Aegis Ventures Limited pursuant to the terms of the consulting services agreement that the Company through its wholly-owned subsidiary Verde Renewables entered into with AUM on November 29, 2024, within three days following the Company’s listing on the NASDAQ. | |
| f) | commitment
pursuant to the terms of the C-Twelve Agreement dated May 19, 2025 and its’ addendum
dated October 8, 2025 entered into by the Company’s wholly-owned subsidiary, Verde
Renewables, with C-Twelve, (i) to allocate to C-Twelve a royalty equal to three percent (3%)
of all future carbon removal credits generated through the use of Verde-C-Twelve intellectual
properties, (ii) to pay an additional license fee of $ | |
| g) | commitment to provide Ergon with forty percent (40%) of its share of the carbon removal credits generated from the mixing of the final carbon sequestering BioAsphalt™ surface material, so long as the carbon removal credits are generated from bulk mixing or packaged mixed product, and the mixing of the final BioAsphalt™ surface material includes biochar purchased from the Company. | |
| h) | Commitment
to issue shares to Michelle Yanez based on a monthly fixed dollar amount of $ |
As of March 31, 2026, the Company has no material contingencies.
NOTE 23 - SUBSEQUENT EVENTS
On May 4, 2026, the Board of Directors, by unanimous written consent, extended the employment terms of Jack Wong, the Company’s Chief Executive Officer and Eric Bava, the Company’s Chief Operating Officer, for an additional five-year period commencing upon the expiration of their current employment agreements on September 30, 2027, and continuing through September 30, 2032, to support leadership continuity in connection with the Company’s anticipated uplisting to the Nasdaq Capital Market and ongoing strategic growth initiatives. The extensions will be on terms consistent with each executive’s existing compensation arrangements and will be subject to the Company’s post-uplisting executive compensation framework previously approved by the Board in April 2025.
In accordance with ASC Topic 855, Subsequent Events, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before unaudited condensed consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after March 31, 2026, up through the date the Company issued the unaudited condensed consolidated financial statements.
NOTE 24 – REVISIONS OF PRIOR-YEAR COMPARATIVE AMOUNTS
During the preparation of the consolidated financial statements for the year ended June 30, 2025, management identified errors in the classification of certain share-based compensation arrangements and equity balances in the previously issued unaudited condensed consolidated financial statements for the period ended March 31, 2025. As a result, the Company has revised certain prior-year comparative amounts to correct these errors. The Company evaluated these adjustments in accordance with ASC 250-10-45-22 through 45-26 and concluded that the revision was required to correct errors in the application of ASC 718, specifically related to the classification of certain equity-related balances. Management determined that certain share-based compensation arrangements for which the service inception period had commenced, but the grant-date criteria under ASC 718 had not yet been met, were previously presented within stockholders’ equity. Under ASC 718, when the grant date has not occurred but services have begun, the related cost attribution should be recognized as a liability until the grant-date criteria are satisfied. Accordingly, the Company has revised the comparative Statement of Changes in Equity as of March 31, 2025 to reclassify the related accrued share-based compensation amounts from stockholders’ equity to current liabilities.
In addition, the Company adjusted the presentation of certain equity related accounts to reflect their appropriate classification in accordance with U.S. GAAP. The Company further evaluated whether the identified errors were material to the previously issued unaudited condensed financial statements in accordance with ASC 250 and Staff Accounting Bulletin No. 99. Based on this evaluation, the Company determined that the errors were not material, either individually or in the aggregate, to the prior period financial statements and did not materially impact trends in results of operations, compliance with regulatory requirements, or key financial metrics. Accordingly, the Company concluded that a revision of certain comparatives included in the current filing relating to prior period unaudited condensed financial statements (commonly referred to as a “little ‘r’ restatement”) was appropriate and has revised the prior period unaudited condensed financial statements in the current filing to correct these errors and enhance transparency.
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Equity and Share-Based Compensation Presentation
Certain balances previously presented as common stock to be issued were combined with common stock issued and common stock to be cancelled were combined within additional paid-in capital in the unaudited condensed consolidated statements of changes in stockholders’ equity to reflect issued share capital on a consistent basis.
Certain share-based compensation arrangements with a non-employee for which the service inception period had not yet commenced, but for which the grant-date criteria under ASC 718 had been satisfied as of December 31, 2024, were previously presented within stockholders’ equity as deferred stock-based compensation as at December 31, 2024. Upon further evaluation, management determined that the related compensation cost should be classified as prepaid share-based compensation as at December 31, 2024 as the grant-date criteria was met as at that reporting date and the shares were committed to be issued. Accordingly, these amounts previously included as deferred stock-based compensation in stockholders’ equity as of December 31, 2024 were reclassified to prepaid share-based compensation in the consolidated balance sheet as at December 31, 2024, resulting in a corresponding change to the stockholders’ equity balance as at December 31, 2024.
Certain share-based compensation arrangements for which the service inception period had commenced, but for which the grant-date criteria under ASC 718 had not yet been satisfied, were previously presented within stockholders’ equity. Upon further evaluation, management determined that the related compensation cost should be classified as a current liability until the grant-date criteria are met. Accordingly, certain amounts previously included in stockholders’ equity as of July 1, 2024 (June 30, 2024) were reclassified to current liabilities in the consolidated balance sheet, resulting in a corresponding change to the opening stockholders’ equity balance.
The revisions described above had no impact on previously reported net loss, earnings per share, total assets, or total cash flows. However, it resulted in changes to the classification and presentation of certain line items within the consolidated statements of changes in stockholders’ equity.
Consolidated statements of changes in stockholders’ equity line item
| Common stock | Common stock to be | Common stock to be | Deferred stock-based | Additional paid-in | ||||||||||||||||||||||||
| No. of shares | Amount | issued | cancelled | compensation | capital | Total | ||||||||||||||||||||||
| Balance as of July 1, 2024 | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||
| - Revisions | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued for private placement | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Share issued for previously committed private placement | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued to service provider | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued for previously committed issued to service provider | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued for previously committed issued to employee | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued to employee | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares to be issued for private placement | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | |||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares to be issued to service provider | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||||||
| - Revisions | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares to be issued to employee | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Share based compensation to employee | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Balance as of December 31, 2024 | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||||||||||||
| - Revisions | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued for private placement | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Share issued for previously committed private placement | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued for previously committed issued to service provider | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | ( | ) | $ | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares issued for previously committed issued to employee | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Shares to be issued for private placement | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | ( | ) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Share based compensation to employee | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - Revisions | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
| Balance as of March 31, 2025 | ||||||||||||||||||||||||||||
| - As previously reported | $ | $ | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||
| - Revisions | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||
| - As revised | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||
The revised presentation reflects the correction of classification errors described above, as well as related adjustments to improve the consistency and comparability of the Company’s financial statement presentation between periods.
In the consolidated statements of operations and comprehensive loss, the weighted average shares of common stock outstanding for the three months ended March 31, 2025 were also revised compared to the amounts previously reported in the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2025.
In connection with the revisions, the Company also reclassified certain lease-related and stock-based compensation cash flow amounts within the consolidated statements of cash flows to conform to the current year presentation. These revisions include the correction of classification errors related to certain lease-related cash flows previously misclassified between operating and financing activities, revisions to the classification of stock-based compensation between non-employee and employee categories, and expanded supplemental cash flow disclosures, including interest paid and noncash investing and financing activities.
These revisions were made in accordance with ASC 842, Leases, ASC 718, Compensation-Stock Compensation, and ASC 230, Statement of Cash Flows, and did not impact the total net change in cash for the period.
| Consolidated statements of cash flows line item | As previously reported | Revisions | As revised | |||||||||
| Stock-based compensation-nonemployee | $ | $ | ( | ) | $ | |||||||
| Stock-based compensation-employee | $ | $ | $ | |||||||||
| Operating lease expense | $ | $ | $ | |||||||||
| Repayment of operating lease liabilities | $ | $ | ( | ) | $ | ( | ) | |||||
| Total cash flows from operating activities | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
| Lease interest paid | $ | ( | ) | $ | $ | |||||||
| Total cash flows from financing activities | $ | $ | ( | ) | $ | |||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||
| Cash paid for interest | $ | $ | $ | |||||||||
| SUPPLEMENTAL NONCASH DISCLOSURE: | ||||||||||||
| Share issuance for employee compensation | $ | $ | $ | |||||||||
| Promissory note to related party settled by Company’s common stock | $ | $ | $ | |||||||||
During the preparation of the condensed consolidated financial statements for the nine-months ended March 31, 2026, management restated the weighted average number of shares (basic and diluted) for the three-months ended March 31, 2025.
| Consolidated statements of operations | As previously reported | Revisions | As revised | |||||||||
| Weighted average common stock outstanding | ||||||||||||
| - Basic and diluted | ||||||||||||
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ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited condensed financial statements and the related notes appearing elsewhere in this Quarterly Report. See “Cautionary Note Regarding Forward-Looking Statements.” Actual results could differ materially from those discussed below.
Overview
We are a road construction and building materials company offering proprietary, environmentally sustainable materials and seeking to redefine our industry with a clear mission: enabling the #TransitiontoZero™. Our proprietary product BioAsphalt™ incorporates biochar, a powerful carbon sequestering material, into infrastructure with the goal of reducing emissions, improving performance, and lowering overall costs. We also offer a licensed proprietary cold mix biochar asphalt emulsifying agent, which we call “Verde V24”. Further, we expect to generate revenues from the generation by our products, and our subsequent sale, of carbon removal credits. We believe our proprietary products, know-how and business plan place us at the forefront of sustainable innovation in the construction and building materials sector, an industry we believe is long overdue for transformation.
Our strategic roadmap for achieving net-zero emissions—what we call the Verde Net Zero Blueprint—has achieved the following significant milestones:
| ● | The issuance to our company in April 2025 of the world’s first carbon removal credit from asphalt production and application, certified by Puro.earth, the leading global registry for engineered carbon removal. | |
| ● | Technological validation of our BioAsphalt™ by NCAT, including receipt of preliminary performance results from NCAT in July 2025 that demonstrated consistent durability, particularly under low-volume roadway conditions. Most recently, in September 2025, NCAT’s latest evaluation of our cold recycling mix using 100% reclaimed asphalt pavement (“RAP”) from laboratory testing demonstrated that our cold-recycled mix not only meets but exceeds industry specifications for cold-recycled asphalt. These results showed superior cohesion, high tensile strength ratio (“TSR”), and retained stability compared to standard cold mix benchmarks, validating its strength, durability, and moisture resistance. |
Our Verde Net Zero Blueprint is comprised of our portfolio of validated technologies that enable the production of sustainable infrastructure materials with the integrated ability to generate certified carbon removal credits. This positions carbon sequestration not just as an environmental co-benefit, but as a monetizable feature embedded in our business plan.
As the rise of artificial intelligence accelerates data center energy consumption, which is now projected to account for a growing share of global electricity use, enterprises worldwide are facing increasing pressure to offset their carbon footprints. We believe this is driving demand for high-integrity, verifiable carbon credits.
Our model presents a novel combination of infrastructure performance with measurable climate impact, establishing us as a first mover in scalable Net Zero solutions, which we believe positions us well to meet the demands of a rapidly decarbonizing, carbon-constrained economy.
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With key third-party validations from groups such as NCAT and Puro. earth in place, we are now focused on commercializing our solutions in the United States, our most strategic market. To this end, in October 2025 we entered into an exclusive licensing agreement with Ergon, an industry leader in asphalt innovation and supply and one of the largest liquid asphalt and emulsion marketers in North America, for the production of asphalt surface course material containing our proprietary solution across North America. As our domestic operations scale through Ergon, we plan to license the Verde Net Zero Blueprint globally, targeting infrastructure and materials companies in countries aligned with the Paris Climate Agreement and pursuing Net Zero by 2050.
We plan to expand operations and generate and grow revenue over the next twelve (12) months primarily through marketing and selling our proprietary road technologies through Ergon exclusively in North America, with an initial focus on the United States. Production planning of our materials has already commenced, with distribution anticipated to occur through the Ergon’s established sales channels, reaching asphalt mixing plants across the United States, Canada and Mexico for blending and placement. Embedding our technology into Ergon’s nationwide business footprint would enable immediate scalability and near-term revenue generation.
We believe our asset light business model enables scalable growth while minimizing capital intensity, creating recurring revenue streams through licensing, sales, royalties, carbon monetization, and strategic commercial arrangements. We operate through our primary U.S. subsidiary, Verde Renewables, headquartered in St. Louis, Missouri.
Recent Developments
On April 27, 2026, we announced a strategic collaboration with Isometric, a leading certifier of carbon removal, to accelerate the certification and commercialization of engineered biochar for use in our BioAsphalt™ technology across North American and global markets.
On April 15, 2026, we engaged WAP Sustainability, a global sustainability consulting firm, to conduct a Life Cycle Assessment (“LCA”) of the engineered biochar used in our BioAsphalt™ product. The LCA is intended to support the potential development of an Environmental Product Declaration (“EPD”), which is an independently verified report that quantifies a product’s environmental impact across its life cycle. We expect that the results of the LCA will be used to assess the environmental characteristics of its biochar and related applications.
On February 10, 2026, we received the first two purchase orders from Ergon for our proprietary cold mix biochar asphalt emulsifying agent, Verde V24, which order delivery occurred during the quarter ending March 31, 2026. The gross revenue generated from these purchase orders is approximately $460,000 and the related receivable was fully collected from Ergon in April 2026. This material event represents our first commercial transaction following the execution of our 10-year exclusive licensing agreement with Ergon in October 2025 and is the first step in our and Ergon’s combined go to market strategy for our cold mix BioAsphaltTM in North America.
Key Factors that Affect Our Results of Operations
We believe the following key factors may affect our financial condition and results of operations:
| ● | Ergon License: Our entry into the Ergon License is expected to drive long-term revenue growth through product sales of Verde V24 and related proprietary materials. The Ergon License establishes Ergon as the exclusive licensee for Verde V24 in the United States, Canada and Mexico, enabling large-scale commercialization of our Verde V24 technology while allowing us to expand our business without the capital demands of direct manufacturing or distribution. | |
| ● | Adoption of Biochar-Asphalt Technology: Market acceptance of the Verde Net Zero Blueprint technologies by contractors, state Departments of Transportation, and private sector customers will influence royalty streams and future expansion opportunities. | |
| ● | Carbon Credit Monetization: The issuance, pricing, and sales of certified carbon removal credits tied to our biochar-based asphalt applications will be a key driver of financial performance. | |
| ● | Operational and Integration Costs: Expenses related to technology transfer, compliance monitoring, and integration into licensee production systems will impact near-term margins. | |
| ● | Biochar Supply and Financing: Our ability to source and finance biochar supply is an important factor in supporting our commercialization activities. We have entered into a strategic collaboration with Biochar Solutions LLC to support our supply of engineered biochar supply, which we believe provides sufficient capacity for anticipated commercialization efforts with Ergon. Future procurement requirements are expected to be funded through operating revenues, gross profits, and, if necessary, additional capital raises through the sale of equity or debt securities. |
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| ● | Regulatory and Environmental Policies: Federal and state infrastructure spending, emissions reduction mandates, and climate policies may accelerate the adoption of our technology and corresponding revenue growth. | |
| ● | Continuous Improvement and Innovation: We are committed to continuous improvement and innovation on our core technologies to enhance performance, durability, and environmental benefits. | |
| ● | Maintaining the Quality of our Products: We seek to maintain robust quality assurance and measurement systems to confirm that all licensed products consistently meet our technical specifications and industry standards. |
Results of Operations
For the three months ended March 31, 2026 and 2025:
The following table sets forth selected financial information from our statements of comprehensive loss for the three months ended March 31, 2026 and 2025:
March 31, 2026 | March 31, 2025 | Change | ||||||||||
| Amount | Amount | % | ||||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Revenue | $ | 460,005 | $ | 697 | 65,898 | % | ||||||
| Cost of revenue | 296,093 | 155 | 190,928 | % | ||||||||
| Gross profit | $ | 163,912 | $ | 542 | 30,142 | % | ||||||
| Selling, general and administrative expenses | 814,904 | 1,170,355 | -30 | % | ||||||||
| Other operating expenses | $ | 59,000 | $ | 46,457 | 27 | % | ||||||
| Loss from operation | $ | (709,992 | ) | $ | (1,216,270 | ) | -42 | % | ||||
| Interest expense | - | (1,343 | ) | -100 | % | |||||||
| Other income | 196,923 | 71,233 | 176 | % | ||||||||
| NET LOSS | $ | (513,069 | ) | $ | (1,146,380 | ) | -55 | % | ||||
The average rate of MYR : USD for three months ended March 31, 2026 and March 31, 2025 was 0.2528 and 0.2247, respectively.
Revenue
| ● | Revenue for the three months ended March 31, 2026 was $460,005, an increase of $459,308, or 65,898%, compared to $697 for the prior year period. |
Revenue for the three months ended March 31, 2026 was primarily derived from the first two purchase orders from Ergon for the proprietary, licensed cold mix biochar asphalt emulsifying agent, Verde V24. In contrast, revenue for the three months ended March 31, 2025 was primarily derived from sales of biochar and natural palm enzymes.
The increase in revenue for the three months ended March 31, 2026, compared to the same period in 2025, was primarily attributable to an initial order of $460,000 from Ergon for Verde V24 in preparation for the execution of its commercialization strategy for its proprietary BioAsphalt™ product.
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Cost of revenue
| ● | Cost of revenue for the three months ended March 31, 2026 was $296,093, an increase of $295,938, or 190,928%, compared to $155 for the prior year period. The increase was primarily attributable to higher sales volume associated with our Verde V24 product in the current period. |
Gross profit
| ● | Gross profit for the three months ended March 31, 2026 was $163,912, an increase of $163,370, or 30,142%, compared to $542 for the prior year period. |
The increase mainly is driven by the initial order from Ergon for Verde V24 during the period.
Selling, general and administrative expenses
| ● | Selling, general and administrative expenses for the three months ended March 31, 2026 was $814,904, a decrease of $355,451, or 30%, compared to $1,170,355 for the prior year period. |
Selling, general and administrative expenses were comprised mainly of salaries, office costs, legal and professional fees, consultancy fee, research and development cost and travelling expenses. Selling, general and administrative expenses decreased by 30%, or $355,451, primarily due to reduction in share-based compensation expense recognized for the three months ended March 31, 2026 as the related service periods for certain consultants were completed in a prior period as per their respective service agreements.
Other operating expenses
| ● | Other operating expenses for the three months ended March 31, 2026 was $59,000, an increase of $12,543, or 24%, compared to $46,457 for the prior year period. |
Other operating expenses were comprised of expenditures related to the maintenance of our biofraction plant in Borneo, arising from our strategic decision to temporarily cease its operation in June 2023 to focus on our North American operations. The variance is attributable to foreign currency translation effects. The weakening of the U.S. dollar resulted in higher reported amounts upon translation into the reporting currency.
Interest expense
| ● | Interest expense for the three months ended March 31, 2026 and 2025 was $0 and $1,343, respectively. |
The absence of interest expense during the current period was primarily attributable to the settlement of lease liabilities in our prior fiscal year in connection with the disposal of assets held for sale and certain property, plant, and equipment that were under financing arrangements.
Other income (expense), net
| ● | Other income (expense), net for the three months ended March 31, 2026 and 2025 was income of $196,923 and $71,233, respectively, representing a favorable change of $125,690 or 176%. | |
| ● | Other income, net for the three months ended March 31, 2026 primarily consisted of: |
| ○ | Unrealized foreign exchange gains of $24,617; | |
| ○ | Gain recognized from the reversal of certain historical related party balances of $30,598 and other payable balances of $131,668 determined to no longer be payable; | |
| ○ | Interest income from short-term investments of $9,666; and | |
| ○ | Sundry income of $374. |
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| ● | Other income, net for the three months ended March 31, 2025 primarily consisted of: |
| ○ | Unrealized foreign exchange gains of $43,808; | |
| ○ | Gain on disposal property, plant and equipment of $2,488; | |
| ○ | Rental income of $4,100; | |
| ○ | Interest income from short-term investments of $21,533; and | |
| ○ | Sundry expense of $696. |
| ● | Interest income from short-term investments decreased to $9,666 in the three months ended March 31, 2026, compared to $21,533 in the prior year period, reflecting reduced investment placements. |
Net loss
| ● | Net loss for the three months ended March 31, 2026 was $513,069, a decrease of $633,311, or 55.2%, compared to $1,146,380 for the prior year period. |
The decrease in net loss was primarily attributable to the factors discussed above, including improved gross profit, lower selling, general and administrative expenses, and favorable changes in other income (expense), net.
For the nine months ended March 31, 2026 and 2025:
The following table sets forth selected financial information from our statements of comprehensive loss for the nine months ended March 31, 2026 and 2025:
| March 31, 2026 | March 31, 2025 | Change | ||||||||||
| Amount | Amount | % | ||||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Revenue | $ | 466,953 | $ | 128,690 | 263 | % | ||||||
| Cost of revenue | 298,314 | 59,303 | 403 | % | ||||||||
| Gross profit | $ | 168,639 | $ | 69,387 | 143 | % | ||||||
| Selling, general and administrative expenses | 2,830,308 | 4,369,233 | -35 | % | ||||||||
| Other operating expenses | 172,137 | 152,273 | 12 | % | ||||||||
| Loss from operation | $ | (2,833,806 | ) | $ | (4,452,119 | ) | -36 | % | ||||
| Interest expense | - | (102,703 | ) | -100 | % | |||||||
| Other income | 467,106 | 1,068,828 | -56 | % | ||||||||
| NET LOSS | $ | (2,366,700 | ) | $ | (3,485,994 | ) | -32 | % | ||||
The average rate of MYR : USD for nine months ended March 31, 2026 and March 31, 2025 was 0.2439 and 0.2270, respectively.
Revenue
| ● | Revenue for the nine months ended March 31, 2026 was $466,953, an increase of $338,263, or 263%, compared to $128,690 for the prior year period. |
Revenue for the nine months ended March 31, 2026 was primarily derived from the first two purchase orders from Ergon for the proprietary, licensed cold mix asphalt emulsifying agent, Verde V24. During the period, we procured Verde V24 from our supplier and completed large-volume sales to Ergon. These transactions represent our initial commercial-scale sales activity for Verde V24, following prior limited pilot sales. Revenue for the nine months ended Mar 31, 2025 was derived from sale of Biochar Asphalt Premix.
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Cost of revenue
| ● | Cost of revenue for the nine months ended March 31, 2026 was $298,314, an increase of $239,011, or 403%, compared to $59,303 for the prior year period. |
The increase was primarily attributable to higher sales volume in the current period, driven by initial purchase orders for our Verde V24 product. The increase also reflects the impact of product mix, as well as higher associated procurement costs and fulfilling early-stage commercial orders during our transition to our upgraded BioAsphalt™ formulation. Cost of revenue for the nine months ended March 31, 2025 were comprised of the cost of Biochar Asphalt products sold.
Gross profit
| ● | Gross profit for the nine months ended March 31, 2026 was $168,639, an increase of $99,252, or 143%, compared to $69,387 for the prior year period. |
The increase in gross profit was primarily attributable to higher sales volumes during the current period, including initial commercial sales of Verde V24. Gross margin as a percentage of revenue decreased compared to the prior year period due to changes in product mix. Revenue during the current period included a greater proportion of Verde V24 sales, which has a different pricing and cost structure compared to the Company’s finished BioAsphalt™ products sold in the prior year period.
Selling, general and administrative expenses
| ● | Selling, general and administrative expenses for the nine months ended March 31, 2026 was $2,830,308, a decrease of $1,538,925, or 35%, compared to $4,369,233 for the prior year period. |
Selling, general and administrative expenses comprised mainly of salaries, office costs, legal and professional fees, consultancy fee, research and development cost and travelling expenses. The $1,538,925, or 35% decrease was primarily due to the absence of the special bonus of $1.25 million to CEO Jack Wong in recognition of his leadership, strategic vision and outstanding contributions in transforming our company into a pioneer in the Net Zero building materials and carbon removal industry recorded in the prior period and reduction in share-based compensation expense recognized for the nine months ended March 31, 2026 as the related service periods for certain consultants were completed in prior period as per their respective service agreements, partially offset by an increase in legal and professional fees related to the Ergon License of $150,000 and research and development costs of $187,500 in current period as we continued our work to the upgraded formulation of our BioAsphalt™ product.
Other Operating Expenses
| ● | Other operating expenses for the nine months ended March 31, 2026 was $172,137, an increase of $19,864, or 13%, compared to $152,273 for the prior year period. |
Other operating expenses consisted of maintenance-related expenditures for our biofraction plant in Borneo following the temporary cessation of operation in June 2023, as we shifted our focus toward our North American operations. The variance is attributable to foreign currency translation effects, as the weakening of the US dollar resulted in higher reported amounts upon translation into the reporting currency.
Interest expense
| ● | Interest expense for the nine months ended March 31, 2026 and 2025 was $0 and $102,703, respectively. |
The absence of interest expense during the current period was primarily attributable to the settlement of lease liabilities in our prior fiscal year in connection with the disposal of asset held for sale and certain property, plant, and equipment that were under financing arrangements, and the early conversion of promissory notes with an aggregate principal amount of $675,888 on August 16, 2024 in the prior period.
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Other income (expense), net
| ● | Other income for the nine months ended March 31, 2026 and 2025 was income of $467,106 and $1,068,828, respectively, representing an unfavorable change of $601,722 or 56%. | |
| ● | Other income for the three months ended March 31, 2026 primarily consisted of: |
| ○ | Unrealized foreign exchange gains of $276,351, | |
| ○ | Gain on forgiveness of debt from the reversal of certain historical related party balances of $30,598 and other payable balances of $131,668 determined to no longer be payable; | |
| ○ | Interest income from short-term investments of $21,489, and | |
| ○ | Sundry income of $7,000. |
| ● | Other income for the three months ended March 31, 2025 primarily consisted of: |
| ○ | Unrealized foreign exchange gains of $320,488, | |
| ○ | Gain on disposal property, plant and equipment of $163,644, | |
| ○ | Gain on insurance claim of $481,513, | |
| ○ | Rental income of $38,200, | |
| ○ | Interest income from short-term investments of $60,342, and | |
| ○ | Sundry income of $4,641. |
| ● | Interest income from short-term investments decreased to $21,489 in the three months ended March 31, 2026, compared to $60,342 in the prior year period, reflecting reduced investment placements. |
Net loss
| ● | Net loss for the nine months ended March 31, 2026 and 2025 was $2,366,700, a decrease of $1,119,294, or 32%, compared to $3,485,994 for the prior year period. |
The decrease in net loss was primarily attributable to the factors discussed above, and lower selling and general and administrative expenses.
Liquidity and Capital Resources
We have a limited operating history in the supply of net zero road construction and building materials and are subject to significant risks and uncertainties associated with early-stage operations, including our reliance on third parties (notably Ergon), and our ability to scale production, achieve consistent revenues, and obtain additional financing to support growth.
The following summarizes the key component of our cash flows for the nine months ended March 31, 2026 and 2025.
| Cash Flow Date | March 31, 2026 | March 31, 2025 | ||||||
| Net Cash Used in operating activities | $ | (2,603,025 | ) | $ | (2,591,258 | ) | ||
| Net Cash Provided by investing activities | 1,276,484 | 2,681,175 | ||||||
| Net Cash Provided by financing activities | 2,448,000 | 330,420 | ||||||
| Effect of exchange rate fluctuation on cash and cash equivalents | (12,995 | ) | (10,111 | ) | ||||
| Net increase in cash and cash equivalents | 1,108,464 | 410,226 | ||||||
| Cash and cash equivalents, beginning of period | 1,021,112 | 279,137 | ||||||
| Cash and cash equivalents, ending of period | $ | 2,129,576 | $ | 689,363 | ||||
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Net cash used in operating activities
| ● | Net cash used in operating activities for the nine months ended March 31, 2026 and 2025 was $2,603,025, an increase of $11,767, or 1%, compared to $2,591,258 for the prior year period. | |
| ● | The increase in cash used in operating activities was primarily attributable to: |
| ○ | Operating loss of $2,366,700; | |
| ○ | Partially offset by non-cash adjustments of $713,582; and | |
| ○ | A net decrease in working capital of $949,907. |
| ● | Non-cash adjustments primarily consisted of: |
| ○ | Depreciation of $170,611; | |
| ○ | Amortization of right-of-use assets of $77,143; | |
| ○ | Share-based compensation of $708,367 to nonemployees; | |
| ○ | Share-based compensation of $128,913 to employees; | |
| ○ | Share-based compensation of $24,855 to a director; | |
| ○ | Operating lease expense of $42,310, and | |
| ○ | Partially offset by an unrealized foreign exchange gain of $276,351 and gain on forgiveness of debts from related parties of $30,598 and other payable of $131,668. |
Cash used in operating activities primarily reflects our net loss, adjusted for non-cash items and changes in working capital.
Net cash provided by investing activities
| ● | Net cash provided by investing activities for the nine months ended March 31, 2026 was $1,276,484, a decrease of $1,404,691, or 52%, compared to $2,681,175 for the prior year period. | |
| ● | Net cash provided by investing activities for the nine months ended March 31, 2026 was primarily attributable to: |
| ○ | Withdrawal of $500,000 from a matured certificate of deposit to support general working capital and operating activities; | |
| ○ | Renewal of deposits of $1,000,000 that had an original maturity period of 90 days at a 60-day maturity period and, as a result, is now classified as a cash equivalent under ASC 230 Statement of Cash Flows; and | |
| ○ | Partially offset by a deposit of $223,516 into a certificate of deposit with a bank. |
| ● | Net cash provided by investing activities for the nine months ended March 31, 2025 was primarily attributable to: |
| ○ | Proceeds from disposal of assets held for sale of $943,300; | |
| ○ | Proceeds from disposal of property, plant and equipment of $947,015; | |
| ○ | Proceeds from insurance recoveries of $541,221; | |
| ○ | Withdrawal of $250,000 from a matured certificate of deposit to support general working capital and operating activities; and | |
| ○ | Partially offset by purchases of property, plant and equipment of $361. |
Net cash provided by investing activities primarily reflects activity related to certificates of deposit in the current period, compared to proceeds from asset dispositions and insurance recoveries in the prior year period.
Net Cash Provided by Financing Activities
| ● | Net cash provided by financing activities for the nine months ended March 31, 2026 and 2025 was $2,448,000, an increase of $2,117,580, or 640.9%, compared to $330,420 for the prior year period. |
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| ● | Net cash provided by financing activities for the nine months ended March 31, 2026 was primarily attributable to: |
| ○ | Proceeds from the issuance of common stock, including $2,000,000 from Ergon; and | |
| ○ | Proceeds from issuance of common stock through private placements of $448,000. |
| ● | Net cash provided by financing activities for the nine months ended March 31, 2025 was primarily attributable to: |
| ○ | Proceeds from issuance of common stock and common stock to be issued through private placements of $1,319,000; | |
| ○ | Partially offset by repayments of lease liabilities of $712,140; | |
| ○ | Refunds from the cancellation of common stock of $65,000; and | |
| ○ | Repayments of bank loan of $211,440. |
Net cash provided by financing activities primarily reflects proceeds from equity financings in both periods, with a significant increase in the current period driven by the Ergon investment.
Overall, we generated modest net cash inflows in both periods, reflecting increased financing activity partially offset by operating cash outflows.
Critical Accounting Estimates
The preparation of our unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosures of contingent assets and liabilities. These estimates and assumptions are based on historical experience, current market conditions and various other factors that management believes to be reasonable under the circumstances. Actual results may differ materially from those estimates.
Management believes that the accounting estimates involving significant judgment and estimation primarily relate to:
| ● | impairment of long-lived assets and intangible assets; | |
| ● | allowance for expected credit losses; | |
| ● | revenue recognition; | |
| ● | stock-based compensation; | |
| ● | classification of warrants; | |
| ● | deferred taxes; and | |
| ● | uncertain tax positions. |
Management evaluates its estimates and assumptions on an ongoing basis and adjusts such estimates prospectively when facts and circumstances change. Certain of these estimates require the use of significant assumptions and judgments, including assumptions related to future operating results, market conditions, economic trends and the interpretation and application of applicable accounting guidance.
For additional information regarding our significant accounting policies and critical accounting estimates, see Note 2 – Summary of Significant Accounting Policies included in the unaudited condensed consolidated financial statements contained in this Quarterly Report.
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Working Capital
| ● | Cash and cash equivalents were $2,129,576 as of March 31, 2026, an increase of $1,108,464, or 109%, compared to $1,021,112 as of June 30, 2025. | |
| ● | Short-term investments decreased by $276,484, or 22%, from $1,276,484 as of June 30, 2025 to $1,000,000 as of March 31, 2026. The remaining $1,000,000 investment that previously had an original maturity of 90 days was renewed with a 60-day maturity and scheduled to mature in May 2026. As a result of the renewal, the investments now meets the definition of a cash equivalent under ASC 230 and has been reclassified accordingly. | |
| ● | Accumulated operating losses increased by $2,363,991, or approximately $13%, from $18,263,181 as of June 30, 2025 to $20,627,172 as of March 31, 2026. | |
| ● | In October 2025, we raised gross proceeds of $2,000,000 through a private placement with Ergon. In addition, during the nine months ended March 31, 2026, we completed other private placements for gross proceeds of $448,000. We believe these financings improved liquidity and strengthened our financial position in the near term. |
We expect to seek additional funding over the next twelve months through public and private offerings of our securities, including a potential national exchange listing of our common stock and a concurrent public offering.
Our primary source of cash is currently generated from the sale of our securities. We will need to raise additional funds beyond our current working capital balance in order to finance future development of our products and services until such time as future revenues are achieved. We anticipate generating revenue in the future from the Ergon License; however, there can be no assurances that sufficient revenue will be generated or that revenues, if any are achieved, will be sufficient to fund our operations on a profitable basis, particularly given our negotiated 15 month “go to market” period with Ergon.
As we continue to make progress commercially, we believe we will have potential opportunities to strengthen our balance sheet as needed including, but not limited to, debt and/or equity financing, as well as through additional potential licensing arrangements. All of these financing options should provide our company with the flexibility as we continue to drive shareholder value. However, we may not be able to obtain financing on favorable terms when needed, or at all. Our ability to obtain additional financing will be subject to a number of factors, including market conditions, fluctuations in interest rates, our operating performance and investor sentiment. If we are unable to raise additional capital when required or on acceptable terms, we may have to significantly delay or scale back our operations or obtain funds by entering into agreements on unfavorable terms. Failure to obtain additional capital on acceptable terms, or at all, would result in a material and adverse impact on our operations.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that are material to investors.
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ITEM 3: Quantitative and Qualitative Disclosure About Market Risk
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.
ITEM 4: Controls and Procedures
Disclosure Controls and Procedures
Under the supervision and with the participation of our senior management, including our principal executive officer and principal financial officer, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this Quarterly Report. We are continuing to enhance our internal control environment; however, as a smaller reporting company with limited personnel, we have identified certain material weaknesses that require further remediation. These include (1) constraints inherent in a small finance team that impact segregation of duties, (2) the need for additional formalization and documentation of accounting policies, procedures, and review controls, (3) the need to further strengthen U.S. GAAP and SEC reporting expertise within the finance function, (4) the absence of an internal audit function to independently assess and monitor the effectiveness of internal controls, and (5) the lack of a functioning audit committee to provide appropriate oversight of the financial reporting and internal control process. Our management has already initiated enhancements to address these matters, including implementing additional review procedures, engaging external advisors where appropriate, and evaluating further changes to our internal control structure. We will continue to prioritize remediation efforts as resources permit.
Changes in Internal Control over Financial Reporting
During the nine months ended March 31, 2026, we have continued to progressively develop and improve on the implementation of internal controls over financial reporting particularly in view of the material weakness described above.
Inherent Limitations of Controls
Internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. GAAP. Because of inherent limitations, internal controls may not prevent or detect all misstatements. In addition, the design, implementation, and effectiveness of controls may be affected by changes in conditions over time. Accordingly, even effective internal controls can provide only reasonable, not absolute, assurance that the objectives of the control system will be achieved.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, we may be subject to legal proceedings, investigations and claims incidental to the conduct of our business.
We are not a party to, nor are we aware of any legal proceedings, investigations or claims which, in the opinion of our management, are likely to have a material adverse effect on our business, financial condition or results of operations.
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Item 1A. Risk Factors
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item. Our current risk factors are set forth in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, filed with the SEC on October 23, 2025.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
During the nine-month period ended March 31, 2026, we conducted the below issuances of our shares of common stock. The shares were issued in reliance upon one or more exemptions from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), including Section 4(a)(2) thereof, and Regulation D and Regulation S thereunder.
| ● | On July 1, 2025, we issued a total of 7,744,445 shares of common stock which were committed to be issued as of June 30, 2025, comprising 4,444,445 shares of common stock for $400,000 at $0.09 per share to one non-U.S. shareholder and 3,300,000 shares of common stock for $264,000 at $0.08 per share to one non-U.S. shareholder and seven U.S. shareholders. See Note 15 Stockholders’ Equity Stock issued and stock cancelled to shareholders. | |
| ● | On July 1, 2025, we issued 1,000,000 shares of common stock to Dr. Raymond Powell. See Note 21 Shares Issued to Nonemployees and Employees, National Implementation Expert Agreements. | |
| ● | On July 28, 2025, we issued a total of 187,500 shares of common stock for $15,000 at $0.08 per share to one U.S. shareholder. See Note 15 Stockholders’ Equity Stock issued and stock cancelled to shareholders. | |
| ● | On September 12, 2025, we issued a total of 5,412,500 shares of common stock for $433,000 at a price of $0.08 per share to three non-U.S. shareholders. See Note 15 Stockholders’ Equity Stock issued and stock cancelled to shareholders. | |
| ● | On October 31, 2025, we issued a total of 24,943,876 shares of common stock to Ergon for gross proceeds of $2,000,000, at a price of $0.08018 per share to Ergon. See Note 14 Warrants. |
| ● | On January 5, 2026, we issued 1,727,115 shares of common stock to Dr. Nam Tran as compensation for services rendered. See Note 21 Shares Issued to Nonemployees and Employees, National Implementation Expert Agreements. | |
| ● | On January 5, 2026, we issued 1,727,115 shares of common stock to Dale Ludwig as compensation for services rendered. See Note 21 Shares Issued to Nonemployees and Employees, National Implementation Expert Agreements. | |
| ● | On January 5, 2026, we issued 1,036,269 shares of common stock to Eric Bava as compensation for services rendered. See Note 21 Shares Issued to Nonemployees and Employees, Eric Bava Chief-Operating Officer. | |
| ● | On January 5, 2026, we issued 86,355 shares of common stock to Hannah Bruehl as compensation for services rendered. See Note 21 Shares Issued to Nonemployees and Employees, Hannah Bruehl-Chief of Staff. | |
| ● | On February 19, 2026, we issued 3,975,155 shares of common stock to Technologies Apex, LLC as compensation for services to be rendered. See Note 21 Shares Issued to Nonemployees and Employees, Apex Agreement. | |
| ● | On February 19, 2026, we issued 165,631 shares of common stock to Christopher David Poorman as compensation for services to be rendered. See Note 21 Shares Issued to Nonemployees and Employees, Poorman Agreement. |
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Mine and Safety Disclosure
Not applicable.
Item 5. Other Information
Not applicable
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Item 6. Exhibits
The following is a complete list of exhibits filed or furnished, as applicable, as part of this Quarterly Report on Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K.
| Exhibit | Description | |
| 3.1 | Amended Articles of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 of the Registrant’s Annual Report on Form 10-K, filed with the SEC on October 23, 2025). | |
| 3.2 | Amended and Revised Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 of the Registrant’s Quarterly Report on Form 10-Q for the period ended September 30, 2025, filed with the SEC on November 19, 2025). | |
| 10.1 | Supply Agreement, dated March 14, 2026, by and between the Registrant and Biochar Solutions LLC (incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed with the SEC on March 19, 2026). | |
| 31.1* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1** | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 32.2** | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS* | Inline XBRL Instance Document | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104* | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| * | Filed herewith. |
| ** | Furnished herewith. |
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SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Date: May 13, 2026 | VERDE RESOURCES, INC. | |
| By: | /s/ Jack Wong | |
| Jack Wong | ||
Chief Executive Officer (Principal Executive Officer) |
||
| By: | /s/ Sherina Chui | |
| Sherina Chui | ||
Chief Financial Officer (Principal Financial and Accounting Officer) |
||
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