Company: FLYE
Filing Date: 2025-12-18
Form Type: 10-Q
Source: 0001213900-25-123281
Chunk: 57

Company: Fly-E Group, Inc.
Filing Date: 2025-12-18
Form: 10-Q
Item: Item 1
Chunk 57
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 which caused the Company’s stock price
to drop approximately 87%. The misconduct resulted in substantial harm to the Company, including costs incurred for defending the separate
Securities Class Action. The relief sought, on behalf of the Company, includes a declaration that the action may be maintained as a derivative
action, an award of damages sustained by the Company, restitution and disgorgement of profits from the Individual Defendants, and the
granting of appropriate equitable relief, such as the institution of appropriate corporate governance measures.

UL Litigation

On or about March 12, 2025, UL LLC (“UL”)
filed a complaint against the Company, along with the Company’s certain subsidiaries and certain individuals, in the Eastern District
of New York (the “Complaint”). The Complaint alleges that the Company improperly used UL’s trademark by claiming certain
products were certified by UL. On May 21, 2025, the Company and UL entered into a settlement and release agreement (the “Settlement
Agreement”) on mutually acceptable settlement terms. Pursuant to the Settlement Agreement, the Company agreed to pay UL an aggregate
amount of $1,000,000 before November 30, 2025 (Refer to Note 7 — Accrued Expenses and other payables). During the six months
ended September 30, 2025, the Company paid $800,000 to UL. From October 1, 2025 to December 16, 2025, the Company paid $200,000 to UL.

Inflation

Inflationary factors, such as increases in personnel
and overhead costs, could impair the Company’s operating results. Although the Company does not believe that inflation has had
a material impact on the Company’s financial position or results of operations to date, a high rate of inflation in the future
may have an adverse effect on the Company’s ability to maintain current levels of gross margin and operating expenses as a percentage
of sales revenue if the revenues do not increase with such increased costs.

13 — RELATED PARTY TRANSACTIONS

(A)
Related party balances

Accounts receivable, net — a
related party

  Name of Related Party  Relationship  Nature  September 30,  2025   March 31,  2025   Fly E Bike SRL  Zhou Ou (CEO), owns over 50% equity interest of this entity  Accounts receivable  $73,130   $78,565   Accounts receivable – a