Company: IMG
Filing Date: 2025-07-21
Form Type: 10-K
Source: 0001641172-25-020300
Chunk: 545

Company: CIMG Inc.
Filing Date: 2025-07-21
Form: 10-K
Item: Item 3
Chunk 545
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 the IRC Section 382 limitation and the 80% taxable income limitation. A full study of the NOL
limitations has not been completed yet.

The Company used statutory blended tax rates of 28%, 11%
and 33.58% for its deferred tax assets that arose in the US, Korea, and Japan respectively.

Deferred tax assets consisted of the following as
of September 30, 2024 and 2023:

SCHEDULE OF DEFERRED TAX ASSETS 

    2024  
    2023 
  
    Net Operating Losses 
     14,296,101  
    $12,413,540 
  
    Stock based compensation 
     -  
     5,944,806 
  
    Fixed assets and intangible assets 
     24,574  
     21,071 
  
    Total deferred tax assets 
     14,320,675  
    $18,379,417 
  
    Valuation Allowance 
     (14,320,675) 
    $(18,379,417)
  
    Deferred tax assets net of valuation allowance 
     -  
    $- 

11. CONTINGENCIES

Steeped Litigation

As previously
disclosed, on January 27, 2023, Steeped, Inc. d/b/a Steeped Coffee (“Steeped”) filed a complaint against the Company in the
Superior Court of California, Santa Cruz County (Case No. 23CV00234) (the “Complaint”). The Complaint related to Steeped’s
claim that the Company breached a 2021 settlement agreement that resolved Steeped’s 2019 trademark infringement case against the
Company. The earlier case involved Steeped’s purported trademark protection for “steeped coffee” and related phrases. 

Steeped
alleged breach of contract, intentional interference with contractual relations, intentional interference with prospective economic advantage,
and fraud in the inducement of contract. Plaintiff sought a trial by jury and relief in the form of a permanent injunction for use of
“Steep Coffee” or any confusingly similar variant of “STEEPED COFFEE”; the impoundment and destruction of allegedly
violating packaging materials and/or finished goods; a final judgment for all profits derived from the Company’s allegedly unlawful
conduct, actual damages, damages to the Steeped’s reputation and goodwill among its customers and partners; and