Company: MVNC
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001683168-25-008388
Chunk: 84

Company: Marvion Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 84
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. If future cash flows are fairly uncertain, the liquidity risk increases.

19.COMMITMENTS AND CONTINGENCIES

On August 15, 2024, the
Company, United Warehouse Management Corp., a British Virgin Island corporation (“UWMC”) and eleven shareholders of UWMC entered
into a Share Exchange Agreement (the “SEA”) pursuant to which the shareholders of UWMC agreed to transfer to the Company 4,000
shares of UWMC, constituting all of the issued and outstanding securities of UWMC, in exchange for 148,148,148 shares of common stock
of the Company, par value $0.0001 per share (the “Acquisition Shares”). In addition to the Acquisition Shares, the Company
agreed to make earnout payments in the aggregate amount of $5.5 million (collectively, the “Earn Out Payments”) upon UWMC’s
achievement of certain net income performance milestones during each six-month period ending June 30 and December 31 (each, a “Performance
Period”) for a total of nine Performance Periods. The Earn Out Payments will be payable in the form of interest free promissory
notes and shared equally among Chan Sze Yu, Fong Hiu Ching and Young Chi Kin Eric, who are also shareholders of the Company.

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

Except as noted above, the
Company had no other material commitments or contingencies as of September 30, 2025.

20.SUBSEQUENT EVENTS

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 the unaudited condensed consolidated financial statements are issued, the Company has evaluated
all events or transactions that occurred after September 30, 2025, up through the date the Company issued the unaudited condensed consolidated
financial statements. The Company had no material recognizable subsequent events since September 30, 2025.

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Item 2.